Michigan Office of Administrative Hearings and Rules  
Administrative Rules Division (ARD)  
MOAHR-Rules@michigan.gov  
REGULATORY IMPACT STATEMENT  
and COST-BENEFIT ANALYSIS (RIS)  
Agency Information:  
Department name:  
Licensing and Regulatory Affairs  
Bureau name:  
Bureau of Community and Health Systems  
Name of person filling out RIS:  
Tammy Bagby  
Phone number of person filling out RIS:  
517-243-9351  
E-mail of person filling out RIS:  
BagbyT@michigan.gov  
Rule Set Information:  
ARD assigned rule set number:  
2023-67 LR  
Title of proposed rule set:  
Adult Foster Care Large Group Homes  
Comparison of Rule(s) to Federal/State/Association Standard  
1. Compare the proposed rules to parallel federal rules or standards set by a state or national licensing agency or  
accreditation association, if any exist.  
The Adult Foster Care (AFC) Large Group Homes (13-20 resident capacity) rules, R 400.15101-R 400.15411, is 1 of  
6 individual AFC rule sets that are being rescinded and will be replaced by a proposed new rule set (Licensing Adult  
Foster Care Facilities) that includes rules from all 6 sets (see 2023-71 LR). There are no comparable federal or  
national licensing statutes, rules, or standards for AFC facilities licensed under the adult foster care facility licensing  
act (act), 1979 PA 218, MCL 400.701 - 400.737.  
A. Are these rules required by state law or federal mandate?  
Section 10(5) of the act, MCL 400.710(5), requires the AFC Licensing Advisory Council to review any rule set not  
less than once every 5 years. These rules are being rescinded and consolidated into 1 single proposed rule set,  
Licensing Adult Foster Care Facilities. There is no federal mandate.  
B. If these rules exceed a federal standard, please identify the federal standard or citation, describe why it is  
necessary that the proposed rules exceed the federal standard or law, and specify the costs and benefits arising out  
of the deviation.  
These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster Care  
Facilities. There is no federal standard available for comparison with the proposed rules.  
2. Compare the proposed rules to standards in similarly situated states, based on geographic location, topography,  
natural resources, commonalities, or economic similarities.  
Most states do not license AFC facilities and are more likely to license assisted living or residential care homes with  
lower acuity levels. These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult  
Foster Care Facilities.  
A. If the rules exceed standards in those states, please explain why and specify the costs and benefits arising out of  
the deviation.  
The proposed rules do not exceed standards in other like states. These rules are being rescinded and consolidated into  
1 single proposed rule set, Licensing Adult Foster Care Facilities.  
MCL 24.245(3)  
RIS-Page 2  
3. Identify any laws, rules, and other legal requirements that may duplicate, overlap, or conflict with the proposed  
rules.  
The rules do not duplicate, overlap, or conflict with any other state laws, rules, or other legal requirements. These  
rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster Care Facilities.  
A. Explain how the rules have been coordinated, to the extent practicable, with other federal, state, and local laws  
applicable to the same activity or subject matter. This section should include a discussion of the efforts undertaken  
by the agency to avoid or minimize duplication.  
The proposed recission of the existing administrative rule set as well as the proposed single rule set, Licensing Adult  
Foster Care Facilities, were shared with the Michigan Department of Health and Human Services to minimize  
duplication or conflict with reimbursement and home and community-based waiver requirements.  
Purpose and Objectives of the Rule(s)  
4. Identify the behavior and frequency of behavior that the proposed rules are designed to alter.  
The bureau is rescinding 6 individual rules sets that pertain to AFC homes, and promulgating 1 new single proposed  
rule set, Licensing Adult Foster Care Facilities. Rescinding the existing rule sets and replacing them with the 1  
proposed rule set is designed to ensure a uniformed standard to provide quality services and maintain a safe  
environment to protect the health, safety, and welfare of residents residing in these licensed facilities 24 hours a day  
and 7 days a week. The proposed rules set a minimum standard for licensed facilities that serve residents often paid  
for with state and federal funding sources such as Medicaid, Medicare, and Social Security.  
A. Estimate the change in the frequency of the targeted behavior expected from the proposed rules.  
These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster Care  
Facilities. The proposed rules align with current practice standards and create a uniform standard among the various  
AFC facility types: family home, small group home, medium group home, large group home, and congregate facility.  
B. Describe the difference between current behavior/practice and desired behavior/practice.  
These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster Care  
Facilities. The proposed rules comport with today’s practice standards, eliminate outdated rules, create uniform  
standards for all licensed providers, as well as specific standards for various provider levels when applicable.  
C. What is the desired outcome?  
These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster Care Facilities.  
The desired outcome is to increase compliance with licensure requirements as the proposed rules include more concise  
and clear standards.  
5. Identify the harm resulting from the behavior that the proposed rules are designed to alter and the likelihood  
that the harm will occur in the absence of the rule.  
These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster Care  
Facilities. The department routinely cites deficient practices of licensed facilities during a routine inspection or a  
complaint investigation, and often these deficiencies resulted in a poor outcome for the resident. The proposed rules  
increase clarity for the minimum standard required.  
A. What is the rationale for changing the rules instead of leaving them as currently written?  
Currently there are 6 different rule sets based on the type of AFC facility, including the AFC Large Group Homes  
Administrative rule set (R 400.15101- R 400.15411). The proposed rules, Licensing Adult Foster Care Facilities, will  
create a single document with applicable requirements for all as well as specific requirements based on the level of  
care being provided significantly reducing the number of rules and pages providers must review.  
6. Describe how the proposed rules protect the health, safety, and welfare of Michigan citizens while promoting a  
regulatory environment in Michigan that is the least burdensome alternative for those required to comply.  
These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster Care  
Facilities. The proposed rule set creates a uniform set of minimum requirements significantly reducing the number of  
rules that licensed providers must follow, especially since many providers operate large systems of licensed facilities  
of various levels.  
7. Describe any rules in the affected rule set that are obsolete or unnecessary and can be rescinded.  
MCL 24.245(3)  
RIS-Page 3  
These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster Care  
Facilities. The proposed rules comport with today’s practice standards and eliminate unnecessary or outdated rules,  
such as no longer requiring routine Tuberculosis testing but instead conducting risk assessments as recommended by  
the Centers for Prevention and Disease Control. The proposed rules set a uniform standard for record retention for  
providers. Other changes include items raised by provider associations, providers, and other stakeholders, such as  
increasing the dollar amount for spending accounts of residents, issuing special licenses during a natural disaster for  
temporary relocation of residents, allowing minors 16-17 years old to be considered as direct care staff with training,  
updating nutritional guidelines, allowing use of space heaters that are Underwriter Laboratories (UL) approved,  
providing clarity on reporting requirements to the department with higher thresholds to reduce the burden on  
providers to report only critical events, setting clearer standards for facility cooling requirements, and increasing  
opportunities for other health professionals to provide critical care and oversight when within the scope of that  
professional practice.  
Fiscal Impact on the Agency  
Fiscal impact is an increase or decrease in expenditures from the current level of expenditures, i.e. hiring additional staff,  
higher contract costs, programming costs, changes in reimbursements rates, etc. over and above what is currently  
expended for that function. It does not include more intangible costs for benefits, such as opportunity costs, the value of  
time saved or lost, etc., unless those issues result in a measurable impact on expenditures.  
8. Please provide the fiscal impact on the agency (an estimate of the cost of rule imposition or potential savings for  
the agency promulgating the rule).  
These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster Care  
Facilities. There is no fiscal impact on the agency.  
9. Describe whether or not an agency appropriation has been made or a funding source provided for any  
expenditures associated with the proposed rules.  
These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster Care  
Facilities.  
10. Describe how the proposed rules are necessary and suitable to accomplish their purpose, in relationship to the  
burden(s) the rules place on individuals. Burdens may include fiscal or administrative burdens, or duplicative  
acts.  
These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster Care  
Facilities.  
A. Despite the identified burden(s), identify how the requirements in the rules are still needed and reasonable  
compared to the burdens.  
These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster Care  
Facilities.  
Impact on Other State or Local Governmental Units  
11. Estimate any increase or decrease in revenues to other state or local governmental units (i.e. cities, counties,  
school districts) as a result of the rule. Estimate the cost increases or reductions for other state or local  
governmental units (i.e. cities, counties, school districts) as a result of the rule. Include the cost of equipment,  
supplies, labor, and increased administrative costs in both the initial imposition of the rule and any ongoing  
monitoring.  
These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster Care  
Facilities.  
12. Discuss any program, service, duty, or responsibility imposed upon any city, county, town, village, or school  
district by the rules.  
These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster Care  
Facilities.  
A. Describe any actions that governmental units must take to be in compliance with the rules. This section should  
include items such as record keeping and reporting requirements or changing operational practices.  
MCL 24.245(3)  
RIS-Page 4  
These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster Care  
Facilities.  
13. Describe whether or not an appropriation to state or local governmental units has been made or a funding  
source provided for any additional expenditures associated with the proposed rules.  
No appropriation or other funding source is provided to state or local government units as there are no related  
expenditures. These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster  
Care Facilities.  
Rural Impact  
14. In general, what impact will the rules have on rural areas?  
This rule set is one of 6 that is being rescinded and will be replaced by a proposed new rule set that includes rules  
from all 6 sets, (see 2023-71 LR). The RIS for the proposed new rule set will address the impact of the proposed  
rules.  
A. Describe the types of public or private interests in rural areas that will be affected by the rules.  
This rule set is one of 6 that is being rescinded and will be replaced by a proposed new rule set that includes rules  
from all 6 sets, (see 2023-71 LR). The RIS for the proposed new rule set will address the impact of the proposed  
rules.  
Environmental Impact  
15. Do the proposed rules have any impact on the environment? If yes, please explain.  
This rule set is one of 6 that is being rescinded and will be replaced by a proposed new rule set that includes rules  
from all 6 sets, (see 2023-71 LR). The RIS for the proposed new rule set will address the impact of the proposed  
rules.  
Small Business Impact Statement  
16. Describe whether and how the agency considered exempting small businesses from the proposed rules.  
This rule set is one of 6 that is being rescinded and will be replaced by a proposed new rule set that includes rules  
from all 6 sets, (see 2023-71 LR). The RIS for the proposed new rule set will address the impact of the proposed  
rules.  
17. If small businesses are not exempt, describe (a) the manner in which the agency reduced the economic impact  
of the proposed rules on small businesses, including a detailed recitation of the efforts of the agency to comply  
with the mandate to reduce the disproportionate impact of the rules upon small businesses as described below (in  
accordance with MCL 24.240(1)(a-d)), or (b) the reasons such a reduction was not lawful or feasible.  
This rule set is one of 6 that is being rescinded and will be replaced by a proposed new rule set that includes rules  
from all 6 sets, (see 2023-71 LR). The RIS for the proposed new rule set will address the impact of the proposed  
rules.  
A. Identify and estimate the number of small businesses affected by the proposed rules and the probable effect on  
small businesses.  
This rule set is one of 6 that is being rescinded and will be replaced by a proposed new rule set that includes rules  
from all 6 sets, (see 2023-71 LR). The RIS for the proposed new rule set will address the impact of the proposed  
rules.  
B. Describe how the agency established differing compliance or reporting requirements or timetables for small  
businesses under the rules after projecting the required reporting, record-keeping, and other administrative costs.  
This rule set is one of 6 that is being rescinded and will be replaced by a proposed new rule set that includes rules  
from all 6 sets, (see 2023-71 LR). The RIS for the proposed new rule set will address the impact of the proposed  
rules.  
C. Describe how the agency consolidated or simplified the compliance and reporting requirements for small  
businesses and identify the skills necessary to comply with the reporting requirements.  
MCL 24.245(3)  
RIS-Page 5  
This rule set is one of 6 that is being rescinded and will be replaced by a proposed new rule set that includes rules  
from all 6 sets, (see 2023-71 LR). The RIS for the proposed new rule set will address the impact of the proposed  
rules.  
D. Describe how the agency established performance standards to replace design or operation standards required  
by the proposed rules.  
This rule set is one of 6 that is being rescinded and will be replaced by a proposed new rule set that includes rules  
from all 6 sets, (see 2023-71 LR). The RIS for the proposed new rule set will address the impact of the proposed  
rules.  
18. Identify any disproportionate impact the proposed rules may have on small businesses because of their size or  
geographic location.  
This rule set is one of 6 that is being rescinded and will be replaced by a proposed new rule set that includes rules  
from all 6 sets, (see 2023-71 LR). The RIS for the proposed new rule set will address the impact of the proposed  
rules.  
19. Identify the nature of any report and the estimated cost of its preparation by small businesses required to  
comply with the proposed rules.  
This rule set is one of 6 that is being rescinded and will be replaced by a proposed new rule set that includes rules  
from all 6 sets, (see 2023-71 LR). The RIS for the proposed new rule set will address the impact of the proposed  
rules.  
20. Analyze the costs of compliance for all small businesses affected by the proposed rules, including costs of  
equipment, supplies, labor, and increased administrative costs.  
This rule set is one of 6 that is being rescinded and will be replaced by a proposed new rule set that includes rules  
from all 6 sets, (see 2023-71 LR). The RIS for the proposed new rule set will address the impact of the proposed  
rules.  
21. Identify the nature and estimated cost of any legal, consulting, or accounting services that small businesses  
would incur in complying with the proposed rules.  
This rule set is one of 6 that is being rescinded and will be replaced by a proposed new rule set that includes rules  
from all 6 sets, (see 2023-71 LR). The RIS for the proposed new rule set will address the impact of the proposed  
rules.  
22. Estimate the ability of small businesses to absorb the costs without suffering economic harm and without  
adversely affecting competition in the marketplace.  
This rule set is one of 6 that is being rescinded and will be replaced by a proposed new rule set that includes rules  
from all 6 sets, (see 2023-71 LR). The RIS for the proposed new rule set will address the impact of the proposed  
rules.  
23. Estimate the cost, if any, to the agency of administering or enforcing a rule that exempts or sets lesser  
standards for compliance by small businesses.  
This rule set is one of 6 that is being rescinded and will be replaced by a proposed new rule set that includes rules  
from all 6 sets, (see 2023-71 LR). The RIS for the proposed new rule set will address the impact of the proposed  
rules.  
24. Identify the impact on the public interest of exempting or setting lesser standards of compliance for small  
businesses.  
This rule set is one of 6 that is being rescinded and will be replaced by a proposed new rule set that includes rules  
from all 6 sets, (see 2023-71 LR). The RIS for the proposed new rule set will address the impact of the proposed  
rules.  
25. Describe whether and how the agency has involved small businesses in the development of the proposed rules.  
These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster Care  
Facilities. The proposed rules received input from all 3 applicable provider associations and their members, including  
small AFC providers and included the understanding that the existing rules sets will be rescinded.  
A. If small businesses were involved in the development of the rules, please identify the business(es).  
MCL 24.245(3)  
RIS-Page 6  
State licensed family and small group homes provided input into the proposed rules, as well as various associations  
that represent all levels of licensed providers. These associations included Leading Age of Michigan, Michigan  
Center for Assisted Living (MCAL), and Michigan Assisted Living Association (MALA). The department held an  
informational webinar with 500+ providers and other interested parties where they provided feedback on the  
proposed rules.  
Cost-Benefit Analysis of Rules (independent of statutory impact)  
26. Estimate the actual statewide compliance costs of the rule amendments on businesses or groups.  
This rule set is one of 6 that is being rescinded and will be replaced by a proposed new rule set that includes rules  
from all 6 sets, (see 2023-71 LR). The RIS for the proposed new rule set will address the impact of the proposed  
rules.  
A. Identify the businesses or groups who will be directly affected by, bear the cost of, or directly benefit from the  
proposed rules.  
This rule set is one of 6 that is being rescinded and will be replaced by a proposed new rule set that includes rules  
from all 6 sets, (see 2023-71 LR). The RIS for the proposed new rule set will address the impact of the proposed  
rules.  
B. What additional costs will be imposed on businesses and other groups as a result of these proposed rules (i.e.  
new equipment, supplies, labor, accounting, or recordkeeping)? Please identify the types and number of businesses  
and groups. Be sure to quantify how each entity will be affected.  
This rule set is one of 6 that is being rescinded and will be replaced by a proposed new rule set that includes rules  
from all 6 sets, (see 2023-71 LR). The RIS for the proposed new rule set will address the impact of the proposed  
rules.  
27. Estimate the actual statewide compliance costs of the proposed rules on individuals (regulated individuals or  
the public). Include the costs of education, training, application fees, examination fees, license fees, new  
equipment, supplies, labor, accounting, or recordkeeping.  
These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster Care  
Facilities. There is no additional cost placed upon the public or any regulated individuals.  
A. How many and what category of individuals will be affected by the rules?  
These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster Care  
Facilities. The proposed rules cover 3,826 state licensed AFC facilities with a capacity to serve more than 31,819  
residents.  
B. What qualitative and quantitative impact do the proposed changes in rules have on these individuals?  
These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster Care  
Facilities. The qualitative impact is that the proposed rules are updated to comport with current practice standards to  
ensure quality of care. The quantitative impact is that the proposed rules reduce the existing 6 rule sets from  
approximately 120 pages and 206 rules to 39 pages and 73 rules. The proposed recission of the AFC Large Group  
Homes administrative rule set includes 46 existing rules and over 32 pages. The last major revision to the AFC Large  
Group Homes rules was in 1994.  
28. Quantify any cost reductions to businesses, individuals, groups of individuals, or governmental units as a result  
of the proposed rules.  
This rule set is one of 6 that is being rescinded and will be replaced by a proposed new rule set that includes rules  
from all 6 sets, (see 2023-71 LR). The RIS for the proposed new rule set will address the impact of the proposed  
rules.  
29. Estimate the primary and direct benefits and any secondary or indirect benefits of the proposed rules. Please  
provide both quantitative and qualitative information, as well as your assumptions.  
These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster Care  
Facilities. The proposed rules directly benefit licensed providers with a single document in place of 6 existing rules  
sets as well as providing uniform minimum requirements for all provider levels when applicable. The secondary  
benefit is to improve consistency of care across provider types with a minimum and uniform level of basic care  
requirements for all residents no matter the facility size.  
30. Explain how the proposed rules will impact business growth and job creation (or elimination) in Michigan.  
MCL 24.245(3)  
RIS-Page 7  
This rule set is one of 6 that is being rescinded and will be replaced by a proposed new rule set that includes rules  
from all 6 sets, (see 2023-71 LR). The RIS for the proposed new rule set will address the impact of the proposed  
rules.  
31. Identify any individuals or businesses who will be disproportionately affected by the rules as a result of their  
industrial sector, segment of the public, business size, or geographic location.  
This rule set is one of 6 that is being rescinded and will be replaced by a proposed new rule set that includes rules  
from all 6 sets, (see 2023-71 LR). The RIS for the proposed new rule set will address the impact of the proposed  
rules.  
32. Identify the sources the agency relied upon in compiling the regulatory impact statement, including the  
methodology utilized in determining the existence and extent of the impact of the proposed rules and a cost-  
benefit analysis of the proposed rules.  
The department used input from the 3 applicable provider associations, AFC Licensing Advisory Council members,  
advocacy groups, other state agencies, and department managers and staff. Key stakeholders, such as the various  
associations, shared the proposed rules with members of their associations (licensed providers) to ensure  
requirements were clear and properly defined. These associations also have national organizations to gather  
information, processes, and methods from other states for like provider types and how these states regulate. The  
department held an informational webinar with 500+ providers and other interested parties where they provided  
feedback on the proposed rules.  
A. How were estimates made, and what were your assumptions? Include internal and external sources, published  
reports, information provided by associations or organizations, etc., that demonstrate a need for the proposed  
rules.  
The demonstrated needs for the proposed rules are set in statute that include a requirement for routine review, as well  
as the need to update existing rules to comport with today’s practice standards to ensure the health, safety, and  
welfare of the residents receiving services in these licensed settings.  
Alternative to Regulation  
33. Identify any reasonable alternatives to the proposed rules that would achieve the same or similar goals.  
These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster Care  
Facilities. There are no reasonable alternatives that would achieve that same or similar goals as these proposed rules  
is the method set forth in the adult foster care facility licensing act and necessary to sustain and demonstrate through  
any administrative process.  
A. Please include any statutory amendments that may be necessary to achieve such alternatives.  
These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster Care  
Facilities. There are no reasonable alternatives to the proposed rules so there are no necessary statutory amendments.  
34. Discuss the feasibility of establishing a regulatory program similar to that proposed in the rules that would  
operate through private market-based mechanisms. Please include a discussion of private market-based systems  
utilized by other states.  
These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster Care  
Facilities. The proposed rules and licensure of this provider category are required by statue. The department in its  
research did not identify a private market-based approach used by any other state for like provider types.  
35. Discuss all significant alternatives the agency considered during rule development and why they were not  
incorporated into the rules. This section should include ideas considered both during internal discussions and  
discussions with stakeholders, affected parties, or advisory groups.  
These rules are being rescinded and consolidated into 1 single proposed rule set, Licensing Adult Foster Care  
Facilities. The department incorporated as many recommendations as possible from stakeholders if the  
recommendations met statutory requirements, specifically Section 17(4) of the continuing care community disclosure  
act, MCL 554.917(4). The proposed rules represent a consensus among those that participated in the development of  
these rules, as well as the AFC Licensing Advisory Council. During the discussions and research, no alternative  
models were suggested by the stakeholders.  
Additional Information  
MCL 24.245(3)  
RIS-Page 8  
36. As required by MCL 24.245b(1)(c), please describe any instructions regarding the method of complying with  
the rules, if applicable.  
This is not applicable because the rules are being rescinded.  
MCL 24.245(3)  
;