Health & Saf. Code, § 1318

(a) The director shall require as a condition precedent to the issuance, or renewal, of any license for a health facility, if the licensee handles or will handle any money of patients within the health facility, that the applicant for the license or the renewal of the license file or have on file with the state department a bond executed by an admitted surety insurer in a sum to be fixed by the state department based upon the magnitude of the operations of the applicant, but which sum shall not be less than one thousand dollars ($1,000), running to the State of California and conditioned upon the licensee’s faithful and honest handling of the money of patients within the health facility.

(b) Every person injured as a result of any improper or unlawful handling of the money of a patient of a health facility may bring an action in a proper court on the bond required to be posted by the licensee pursuant to this section for the amount of damage the person suffered as a result thereof to the extent covered by the bond.

(c) The failure of any licensee under this section to maintain on file with the state department a bond in the amount prescribed by the director or who embezzles any patient’s trust funds shall constitute cause for the revocation of the license.

(d) The provisions of this section shall not apply if the licensee handles less than twenty-five dollars ($25) per patient and less than five hundred dollars ($500) for all patients in any month.

(e) The director may exempt licensed health facilities of the types specified in subdivisions (a), (b), (c), and (f) of Section 1250 from the requirements of this section. However, the exemption from the bond purchase requirements of this section shall not affect the financial liability of such health facilities.