California establishes sequencing and disclosure rules for repayable continuing-care contracts
Sep 20, 2026 edition · GC-2026-0113 · Published 2026-09-20 · Version 2 · Final
AB 1983 separates sequential-account repayments from resale-triggered continuing-care repayments.
What happened
AB 1983 became Chapter 281 on September 18. It establishes terms for repayable-in-sequential-order continuing-care contracts, including an exclusive sequential repayment account and disclosures that repayment depends on sufficient funding and the assigned repayment position. For that contract type, the full amount owed is due within 14 calendar days after sufficient account funds exist to satisfy the assigned number. A resale-conditioned contract instead uses resale or reoccupancy as its 14 day trigger. Repayments after termination are not cancellation refunds and cannot be advertised as refunds.
The statute preserves interest rules for the applicable contract cohorts and adds sequential-account provisions for contracts entered on or after January 1, 2027. For those contracts, interest begins accruing 180 days after termination even if the account lacks sufficient funds, but accrual does not change repayment priority. Principal and interest are paid in sequence, and the account must have enough for both before repayment. Ordinary commencement is January 1, 2027. Providers must therefore distinguish contract type, termination timing, applicable interest cohort and account funding rather than using one general refund clock.
Scope and timing
- Authority status
- Final
- Applicability
- Directly applicable
- Audience
- Health systems, Provider networks
- Jurisdiction
- California
- Recorded date
- 2027-01-01
- Date type
- effective
Why it matters
Continuing-care finance and contracting systems need separate triggers and terminology for refunds, resale-conditioned repayments and sequential repayments.
Recommended action
Review contract forms, disclosures, account funding and interest calculations before commencement; verify the relevant contract cohort and preserve the assigned payment sequence.
Sources
- AB 1983, chaptered bill text and historyOfficial · California Legislature · 2026-09-18 · Source review 2026-09-20
- Official retained source documentOfficial · Official issuing agency · Source review 2026-10-16
- Official retained source documentOfficial · Official issuing agency · Source review 2026-10-16
- Official retained source documentOfficial · Official issuing agency · Source review 2026-10-16
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