We serve business owners and investors in the nursing home and assisted living industry. At Deming Law, we build multi-tiered corporate structures that protect your business and the substantial investment it represents in this unique industry. Nursing homes and assisted living facilities bring together several distinct kinds of risk under one roof. We understand these risks, and we address them intentionally, by separating this business into distinct corporate entities, so that risk in one area does not reach the assets held in another. There is often the real estate itself, a physical asset built or acquired at significant cost, and one we protect by holding it separately from the business that operates on it. There is the operating business, the licensed entity that cares for residents and carries the risk that comes with it. And there is the management of that business, the back-office work, such as accounting, payroll, and regulatory compliance support, that keeps it running day to day, which we house in its own entity, engaged by the operating company under a paid service arrangement. These three aspects tend to be distinct, and for good reason. We help owners in this industry structure each of these pieces so they work together as one business, while maintaining the proper separation between them that lets each tier leverage its own protection.
Corporate Structures for Nursing Homes and Assisted Living
The Licensed Operating Company (OpCo)
The licensed operating company holds the facility license, employs or engages the clinical and administrative workforce, contracts with residents and payers, and carries the operational and professional liability that comes with caring for residents.
The Property Company (PropCo)
The property company holds title to the land, buildings, and permanent infrastructure, and leases the facility to the operating company through a triple-net master lease, under which the operating tenant is responsible for property taxes, insurance, and maintenance. The property company has no employees and no resident-facing contracts. By shifting operational revenue out of the OpCo and into the PropCo as rent, the risk-facing entity is equity stripped, and the real estate remains insulated from healthcare creditors and malpractice plaintiffs.
The Management Company (ManCo)
The management company provides back-office services to the operating company, such as accounting, payroll, and regulatory compliance support, under a written management agreement and for a paid fee. Where the management company is a separate party from the owner, the agreement defines authority, reporting, and fees. Where the owner also manages, the separate entity keeps those functions distinct.
The property company and operating company may share the same owners. Often they do. The separation holds regardless, provided the entities respect one another as distinct.
Why the Operating Company (OpCo) Stands Apart
We separate the operating company from the property company and the management company for a specific reason. The operating company is the entity most exposed to claims, since it is the one in direct contact with residents and responsible for their day-to-day care. If the management function, and the cash reserves and administrative value it generates, sat inside that same entity, a judgment against the facility could reach those reserves directly. By keeping the ManCo separate, that administrative value stays a step removed from the risk the OpCo carries day to day.
This works alongside the same mechanism that protects the real estate. The lease payment to the PropCo and the management fee paid to the ManCo both move funds out of the OpCo as a cost of doing business, equity stripping the risk-facing entity of the reserves a plaintiff would otherwise be able to reach. The result is that both forms of value, the real estate and the administrative and cash reserves, are allotted to non-risk-facing entities, maximizing the protection the structure provides. Where an owner operates more than one facility, this separation also helps keep a problem at one location, such as a licensing or exclusion issue, from spreading sideways into the others, while also protecting the real estate investment and cash reserves held in the non-risk-facing entities.
Ownership Disclosure and Consistency
The Agency for Health Care Administration (AHCA) requires disclosure of the owners and controlling interests behind a licensee. Entity names and ownership information must remain consistent across the AHCA application, the Florida Division of Corporations (Sunbiz) records, and Internal Revenue Service records. Inconsistencies create avoidable delay at application, at renewal, and at any change of ownership. We prepare the structure with that consistency built in from the outset.
Maintaining the Shield
Beyond building these corporate structures, we draft the agreements needed to maintain entity separation and preserve the protections each tier provides. This includes the leases between the PropCo and the OpCo, the management agreement between the ManCo and the OpCo, and the other intercompany arrangements that govern how these entities interact. Properly documenting these legal intercompany arrangements is essential to reinforcing the liability shield between entities and withstanding scrutiny in the event of litigation or creditor claims.
Nursing Homes
Opening and operating a nursing home in Florida requires compliance with Florida Statutes, Chapter 400 (Part II), Florida Administrative Code, Chapter 59A-4, and the Florida Building Code. We assist owners through the AHCA licensing application process itself, from assembling the application packet to coordinating the required supporting documentation and inspection materials.
Core Licensing Requirements
These items are submitted to AHCA together as an application packet, which also includes the application itself, the Comprehensive Emergency Management Plan, and local fire and sanitation inspection reports. The final step is the initial on-site life safety and health inspection by AHCA and local authorities. A license is granted only after the facility passes.
Staffing Standard
Staffing under Section 400.23(3)(a), Florida Statutes, scales with the number of residents and is not a single fixed figure. A nursing home must provide an overall average of 3.6 hours of direct care per resident per day. Within that average, the facility must provide a minimum certified nursing assistant component of 2.5 hours per resident per day and a minimum licensed nursing component of 1.0 hour per resident per day. Ratio floors also apply, with no fewer than one certified nursing assistant for every 20 residents and no fewer than one licensed nurse for every 40 residents. Staffing cost is therefore a core input to the operating company's financial projections, and to the lender and regulator review that follows.
Certificate of Need
Nursing homes, hospices, and intermediate care facilities for individuals with developmental disabilities remain subject to the Certificate of Need program. Florida repealed the requirement for general and specialty hospitals in 2019 and 2021, but not for nursing homes. Unlike many other care settings, opening or expanding a skilled nursing facility typically requires navigating the state approval process, depending on regional bed allocations. The requirement also matters in acquisitions and ownership transfers, where it affects what the buyer is acquiring.
Federal Compliance
Nursing homes that accept Medicare or Medicaid residents must also meet the federal Conditions of Participation set by the Centers for Medicare and Medicaid Services (CMS). Federal certification operates alongside state licensing. It does not replace it, so a facility must satisfy both.
Federal Ownership Disclosure
Under a 2023 CMS final rule implementing Section 6101(a) of the Affordable Care Act, Medicare and Medicaid participating nursing facilities must disclose detailed ownership, managerial, and governance information. The rule includes defined terms for private equity companies and real estate investment trusts. This directly affects the property company and holding company structure described above, and it belongs in the planning of any structure from the start.
Change of Ownership
A change of ownership is defined under Section 408.803, Florida Statutes, and includes a transfer of fifty-one percent or more of the ownership or controlling interest. Under Section 408.807, Florida Statutes, the application must be filed with AHCA at least sixty days before closing, and the transferor remains liable until the new license issues. Any sale, acquisition, or restructuring of ownership must be planned around this timeline.
Building Codes and Physical Plant
New construction, conversions, additions, and renovations must comply with the Florida Building Code and Florida Administrative Code Rule 59A-4.133. Fire safety rules enforced by the State Fire Marshal under Florida Administrative Code Chapters 69A-53 and 69A-60 also apply.
Architectural and engineering plans must be reviewed, and construction surveyed, by the state agency authorized under Section 553.80(1)(c), Florida Statutes, which is AHCA's Office of Plans and Construction. Under Rule 59A-4.134, the plans must be prepared by a Florida registered architect and a Florida registered engineer.
Room and Space Layout
Disaster Preparedness and Emergency Environmental Controls
Each facility must maintain a Comprehensive Emergency Management Plan covering evacuation, sheltering, and emergency power, under Section 400.23, Florida Statutes. Licensees must also participate in the Health Facility Reporting System, formerly the Emergency Status System, for emergency status and operations reporting, as required by Section 408.821(4), Florida Statutes.
Medical Director and Physician Services
A nursing home does not need a physician on site around the clock. It requires a designated Medical Director, under contract. At a minimum, the Medical Director must visit the facility once a month under Rule 59A-4.1075. A facility with 60 beds or fewer may use a medical consultant in place of a full Medical Director. The facility must also maintain a list of physicians available for emergency coverage when a resident's own physician cannot be reached. Residents retain the right to choose their own physician.
The resident's attending physician is a separate requirement. Under federal regulation 42 CFR 483.30, the attending physician must visit the resident at least once every 30 days. The round-the-clock requirement applies to nursing staff. Section 400.23(3)(a), Florida Statutes, requires sufficient nursing personnel on a 24-hour basis to meet residents' needs.
Medication and Controlled Substance Handling
Under Rule 59A-4.112, a nursing home must adopt procedures that assure the accurate acquiring, receiving, dispensing, and administering of all drugs and biologicals. The consultant pharmacist must maintain a reconciliation system that tracks the receipt and disposition of every controlled drug. A controlled substance dispensed to a resident but not used cannot be returned to the pharmacy. It must be securely stored at the facility until properly destroyed, with documentation of the drug name and quantity destroyed maintained for each instance.
Institutional Pharmacy Permit and Medication Storage
Separate from the facility license, and separate from the consultant pharmacist's individual license, a nursing home must hold its own Class I Institutional Pharmacy permit, issued by the Florida Board of Pharmacy under Chapter 465. Under this permit, medications are administered from individually labeled prescription containers rather than compounded or dispensed on site. The consultant pharmacist of record, engaged through a written collaborative practice agreement under Section 465.0125, Florida Statutes, must provide a written, on-site drug regimen review at least once a month for every resident.
Prescription drugs, including those requiring refrigeration, must be kept in a locked refrigerator or within a locked medication room, accessible only to licensed staff. A facility may maintain a sealed Emergency Medication Kit, with contents determined in consultation with the Medical Director, the Director of Nursing, and the consultant pharmacist. The kit carries its own inventory, logging, and resealing requirements.
This institutional pharmacy permit is frequently overlooked during the structuring and acquisition process. It is a separate regulatory track from facility licensing, with its own permit, its own governing board, and its own audit exposure, and it must be accounted for independently when building or acquiring a nursing home.
Private Payer Contracting
Medicare and Medicaid are government certification programs. Commercial insurers, or private payers, operate differently. A facility must separately apply to, and be approved into, each private payer's provider network, each with its own credentialing checklist. Applications commonly require state license numbers, a Medicare participation number, and proof of liability coverage. An industry benchmark often seen is one million dollars per occurrence and three million dollars in the aggregate. Section 400.141(1)(s), Florida Statutes, requires nursing homes to maintain general and professional liability insurance in force at all times, without stating a dollar minimum. Credentialing is ongoing and payer-specific. It is not a one-time step.
Other Regulatory Areas
Nursing homes also operate under infection control and resident assessment protocols, a separate statutory layer of resident rights and grievance procedures under Chapter 400, and an internal risk management and quality assurance committee that must meet on a set schedule and document its findings.
Assisted Living Facilities
Assisted living facilities are licensed under Florida Statutes, Chapter 429 and Florida Administrative Code, Chapter 58A-5. The requirements parallel those for nursing homes, with important differences. We assist owners through the AHCA licensing application process itself, from assembling the application packet to coordinating the required supporting documentation and inspection materials.
Core Licensing Requirements
Assisted Living Facilities Application and Inspection Process
Assisted living facilities are not subject to the Certificate of Need program. They do, however, submit these items to AHCA as a single application packet. The packet includes the Comprehensive Emergency Management Plan under Sections 400.23 and 429.41, Florida Statutes, and the local fire and sanitation inspection reports. The initial on-site life safety and health inspection by AHCA and local authorities is the final gate before licensing.
Specialty Licenses
Every assisted living facility holds a standard license. A facility may add specialty licenses to serve residents with greater needs.
Admission and Continued Residency
Under Section 429.26, Florida Statutes, each resident requires an evaluation of strengths, needs, and preferences, together with a medical examination within 60 days before admission by a physician, physician assistant, or advanced practice registered nurse. A resident who requires 24-hour nursing supervision may not be admitted or retained, regardless of license type, subject to a narrow hospice exception. This is the line that separates assisted living from nursing home level care.
Staffing Standards
A facility with 17 or more residents must have at least one staff member awake at all hours. At least one staff member trained in first aid and CPR must be present at all times residents are present. This differs from nursing homes, where continuous licensed nursing coverage is required regardless of size.
Room and Space Requirements
A facility must provide 35 square feet of combined living and dining space per resident, live-in staff member, or family member, except in apartment-style facilities. The facility must also meet the furnishing standards set by rule.
Disaster Preparedness
The disaster preparedness standards mirror those for nursing homes. A facility must keep indoor temperatures at or below 81 degrees Fahrenheit and maintain 96 hours of fuel or backup power. A facility in an evacuation zone must evacuate or maintain 96-hour backup power. The Health Facility Reporting System requirement applies to assisted living facilities as well.
Change of Ownership
Change of ownership for assisted living facilities is governed by Section 429.41, Florida Statutes, together with Sections 408.803 and 408.807, Florida Statutes. A change in the use of space that alters licensed capacity also requires prior approval from AHCA's Central Office, a requirement worded differently than for nursing homes.
Pharmacy Permitting
An assisted living facility does not itself hold an institutional pharmacy permit. Medication is typically supplied through an outside community pharmacy, or through a pharmacy holding a Special Pharmacy Permit for Assisted Living Facilities. That is a distinct permit category issued by the Florida Board of Pharmacy to the servicing pharmacy, not to the facility. The facility's own obligations center on proper storage, nurse management of medication where applicable, and compliance with its medication practices policies.
Matters Common to Both Facility Types
Nurse Licensing Levels
In a nursing home, the staffing hierarchy runs from certified nursing assistant to licensed practical nurse to registered nurse. The Director of Nursing must be a registered nurse. Tasks may be delegated downward only within strict limits. For example, a licensed practical nurse may delegate to a certified nursing assistant only routine tasks that do not require nursing judgment, under Rule 64B9-16.002.
In an assisted living facility, unlicensed staff may only assist residents with self-administration of their own medication, after brief training. Actually administering medication, or performing any licensed nursing task, requires a licensed practical nurse, registered nurse, or advanced practice registered nurse on staff or under contract. This ties directly to the Limited Nursing Services license described above.
Zoning
Zoning for nursing homes and larger assisted living facilities in Florida is governed at the local level rather than by a single statewide standard. Each county and municipality sets its own zoning ordinance, and these facilities typically require a special exception or conditional use permit before a site can be developed or converted for this use. We work with clients early in the site selection and acquisition process to evaluate local zoning requirements before capital is committed.
Upfront Cost Transparency with Flat-Fee Pricing
Our services are based on a flat fee structure, providing you with upfront, transparent pricing for the work we deliver. Our objective is the same as yours, to protect your business and see it succeed, as your trusted legal partner. Therefore, you can reach out freely without worrying about additional costs. We encourage you to call or email us when you have a question or concern, because better communication leads to better outcomes. We built our practice on a strong base of long-term and referred clients as a result of being genuinely invested in their success.
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