Assisted Living Rate Increases in California: Notice Rules and Your Options

Yes. Assisted living communities and board and care homes are licensed in California as residential care facilities for the elderly (RCFEs), and the RCFE statutes on rates deal with notice and disclosure. They do not set a ceiling on what a private-pay home may charge. California Advocates for Nursing Home Reform (CANHR) puts it bluntly in its fact sheet on admission agreements: a facility can charge what the market will bear, but every fee must be clearly stated in the admission agreement.

So the protection a family has is information and time. The law requires the contract to say when rates can go up, requires advance written notice of an increase, and requires the home to show its recent history of increases before you sign.

This page describes the rules as written. It is not legal advice. The Long-Term Care Ombudsman or an elder law attorney can look at a specific notice and contract.

Health and Safety Code section 1569.655 says that if a licensee increases the rates of fees for residents, or increases any of its rate structures for services, it must give no less than 90 days' prior written notice to the residents or their representatives. The current wording took effect January 1, 2025, under Senate Bill 1406.

The notice has to set out the amount of the increase and the reason or reasons for it, including a description of the additional costs. The Resident's Bill of Rights repeats the point: section 1569.269 gives residents the right to written notice of any rate increase.

If an agreement or a notice shows a shorter period, compare it with the statute and ask the home or the Ombudsman about the difference.

The 90-day rule has one stated exception: an increase due to a change in the level of care of the resident. That is covered by section 1569.657. For this kind of increase, the home must give the resident and the resident's representative, if any, written notice within two business days after it first provides services at the new level of care.

The notice must include a detailed explanation of the additional services to be provided at the new level, with an itemization of the charges. This kind of increase can follow a reassessment after a fall, a hospital stay or a change in memory or mobility. The contract must describe how service needs are evaluated, so you can compare the notice with that method. Our guide to the care assessment explains how homes set a care level.

A resident has the right to take part in planning their care and to request, refuse or discontinue a service. If you think the new level is wrong, you can ask the home to walk you through the reassessment and to say which services drive the charge.

Section 1569.655 says a licensee shall not charge nonrecurring lump-sum assessments. It defines these as rate increases due to unavoidable and unexpected costs that financially obligate the licensee. Instead of a lump sum, the increase has to be made to the monthly rate and spread over a 12-month period, with the same advance notice. The ban does not apply to charges for specific goods or services provided to an individual resident.

Separate charges have their own rule. Under section 1569.884, a home may assess a separate charge for an item or service only if the admission agreement authorizes it, and the resident must receive a monthly statement itemizing all separate charges. If a charge appears that you cannot find in the contract or its fee schedule, ask the home to show you where it is authorized. The admission agreement guide lists what the contract has to contain.

Two disclosures help you judge what the bill may look like in a few years.

• The admission agreement must state the conditions under which rates may be increased.
• By January 31 each year, section 1569.658 requires the home to prepare a document disclosing its average monthly rate increases for each of the previous three years, covering living units and service fees but not optional or third-party services. It must show both the average amount and the average percentage.
• The home must give a written copy to every resident or representative on signing an admission agreement, and the resident or representative signs a confirmation of receipt.
• The home must give a copy of the most recent disclosure to any prospective resident or their representative. A newer home without three years of history discloses the years it has.

Residents who receive SSI/SSP are treated differently. Section 1569.655 says increases for these residents must meet the requirements for SSI/SSP rate increases as prescribed by law, and the level of care notice rule in section 1569.657 does not apply to them. CANHR's fact sheet says the SSI rate covers the full charge for all basic services for a resident on SSI.

The sections on rate notices, level of care notices and rate history also do not apply to providers that hold a certificate of authority to offer continuing care contracts. Residents of continuing care retirement communities have a different contract and a different set of rules, so ask the community or an attorney which apply.

Hamssa Benrekia is a senior living placement specialist in Torrance who helps families in the South Bay and Harbor area find licensed assisted living communities and board and care homes. If an increase means the current home no longer fits the budget, she can talk through homes that may. She does not give legal advice. More topics are in the California Assisted Living Placement Guide. To talk about options, contact Hamssa.

1. 1

   Get it in writing and note the dates

   Write down the date you received the notice and the date the new rate starts. For a general increase, count whether that is at least 90 days.

2. 2

   Check what the notice says

   Look for the amount, the reasons and a description of the additional costs. For a level of care increase, look for the explanation of new services and the itemized charges.

3. 3

   Compare it with the admission agreement

   Read the section on when rates may be increased and the fee schedule. Ask the home questions in writing and keep the answers.

4. 4

   Ask for help if the notice looks wrong

   Residents have the right to contact the Department of Social Services, the Long-Term Care Ombudsman, or both, about a grievance against a home. An elder law attorney can advise on the contract.

5. 5

   Weigh your options

   Some families ask the home what is flexible, covered in which fees are negotiable. Others compare other homes. A resident has the right to move, subject to the notice the agreement requires.