TITLE XXXVII
INSURANCE

Chapter 420-D
CONTINUING CARE COMMUNITIES

Section 420-D:1

    420-D:1 Definitions. –
In this chapter:
I. [Repealed.]
II. "Commissioner" means the insurance commissioner.
III. "Continuing care" or "life care" means furnishing or promising to furnish to a person, other than one who is related by consanguinity or affinity up to, but not including, the third degree, services that shall include board or lodging, or both, and may include nursing services, medical services, or other health related services, irrespective of whether the board, lodging, and services are provided at the same location or provided by a third party, pursuant to a contractual agreement extending for the life of such person or for a period of a year or more in consideration of payment of an entrance fee which may also include additional periodic charges for the services provided and including contracts which are terminable by either party. Continuing care or life care includes contracts with residents meeting the requirements in this paragraph, where the resident contracts to receive board or lodging or both in the future and does not move immediately into the facility.
IV. "Department" means the insurance department.
V. "Entrance fee," "entrance deposit," or "accommodation fee" means an initial or deferred payment, agreed upon in the contract, of a sum, usually a lump sum, in cash or in kind, to a provider in return for acceptance as a resident. This definition shall not apply to the payment of a sum which is less than the total of periodic payments, as defined in paragraph X of this section, for one year or $10,000.
VI. "Facility" means any facility or institution providing board, lodging, or other services under a contract for continuing care.
VII. "Licensed" means that the provider has obtained a certificate of authority from the commissioner.
VIII. "Living unit" means a room, apartment, or other area within a facility used exclusively by one or more, but usually no more than 2 residents living independently and does not include a nursing home unit, skilled nursing facility, hospital room, assisted living unit, or any other similar units or facility licensed under RSA 151.
IX. "Manager" means a person who operates a facility.
X. "Periodic payments" or "monthly care fees" means those payments in addition to the entrance fee made by a resident to a provider for continuing care during the entire period that the contractual agreement for continuing care is in effect.
XI. "Provider" means a person contracting to provide continuing care at a facility. This may be a natural person, partnership, or any other type of business organization, whether organized for profit or not.
XII. "Resident" means a person entitled, pursuant to a contract with the provider, to receive continuing care in a facility.
XIII. "Solicit" means all actions by a person or provider seeking to have individuals enter into a continuing care agreement. This includes, but is not limited to, mail, telephone, personal contacts, and media advertisements.
XIV. (a) "Unearned portion of entrance fee" means that portion of the entrance fee which a provider contracts to return to a resident should the resident cancel the contract for continuing care. This may be nothing, or the contract may call for the provider to "earn" a specific percentage of the entrance fee per month.
(b) "Earned portion of entrance fee" means that portion of the entrance fee "earned" by the provider under the terms of the contract, which the provider may retain.
XV. "Just cause" means conduct constituting a criminal offense involving moral turpitude, gross dereliction of duty, or gross abuse of authority.

Source. 1988, 44:2. 1989, 26:1, 2. 2001, 276:6. 2010, 144:1-5, eff. Jan. 1, 2011.

Section 420-D:2

    420-D:2 Certificate of Authority. –
I. No person or provider may solicit funds, accept payments of any kind, or otherwise engage in providing any form of continuing care without a certificate of authority issued under this chapter. An application for a certificate shall include the proposed disclosure statement required under RSA 420-D:4 and in addition to any other state or federal licensure or certification which may be required, a statement indicating that all of the requirements under this chapter have been met. The commissioner shall take prompt action on requests for a certificate and shall, within a reasonable time, issue a certificate or a written rejection. If he rejects an application, he may do so outright or state the conditions which must be met before a certificate shall be issued. The applicant may request reconsideration and shall be granted a hearing in accordance with rules adopted by the commissioner. Certificates issued under this section shall continue in effect until revoked by the commissioner or until sale or transfer of management control to another owner or provider.
II. [Repealed.]
III. Continuing care facilities which reported to or were under the supervision of the director of charitable trusts of the department of justice under RSA 7:19 through 32-a on January 1, 1989, shall be exempt from the provisions of this chapter. However, any such facility may elect by a one-time irrevocable election to be subject to the provisions of this chapter by filing an application for a permanent certificate of authority with the commissioner.

Source. 1988, 44:2. 1990, 36:1. 1999, 249:2, 6, I, eff. Sept. 7, 1999.

Section 420-D:3

    420-D:3 Renewal of Certificate of Authority. – Certificates of authority shall continue in effect until revoked by the commissioner. Certificates shall not be transferred during this time to another provider or owner. The commissioner shall establish a fee for applications for certificates of authority by rules adopted under RSA 541-A.

Source. 1988, 44:2, eff. Jan. 1, 1989.

Section 420-D:3-a

    420-D:3-a Continuing Care at Home Contracts. –
I. A provider may contract to provide continuing care to a resident who remains at home and does not move immediately into a facility if the provider:
(a) Holds a certificate of authority issued under this chapter to provide continuing care.
(b) Owns and operates a facility located in New Hampshire where the resident has the right to receive board, lodging, or both, and other services.
(c) Satisfies the commissioner that the proposal to offer continuing care contracts to residents who do not move immediately into the facility will not place the provider in an unsound financial condition and will not be injurious or hazardous to any resident contracting with the provider for continuing care.
(d) Otherwise complies with all requirements of this section and RSA 420-D.
II. Any provider that issues contracts under this section shall:
(a) Be in good standing with the commissioner, not subject to action pursuant to RSA 420-D:5.
(b) Be responsible for all services the provider or any third party provides to the resident in the resident's home pursuant to the contract, and shall exercise direct control and oversight over any individual or entity providing those services.
(c) Have procedures to ensure that any third party providing services to the resident in the resident's home pursuant to the contract is trustworthy and certified, licensed, or otherwise qualified under state law to provide those services.
III. The provider and any person employed by the provider that assists in delivery of services to the resident in the resident's home shall have a business location within the state of New Hampshire, hold appropriate licenses and shall be available to address complaints, questions, and concerns of residents.

Source. 2010, 144:6, eff. Jan. 1, 2011.

Section 420-D:4

    420-D:4 Disclosure Statement. –
I. Each provider shall provide each prospective resident with a disclosure statement which has been approved by the commissioner. The disclosure statement shall be delivered before the initial transfer of funds or before any contract is consented to by each prospective resident of the facility. The disclosure statement shall include, in conspicuous large type, the statement: "NOTICE: You are advised to consult with an attorney before signing any documents or agreements concerning this matter. You have the right to cancel this agreement within 10 days after signing without obligation, except for certain described services and charges." The language of the disclosure statement shall be in plain and understandable English.
II. The disclosure statement shall include the following information:
(a) The name of the organization and whether it is for profit, and whether it is a partnership, corporation, or other type of organization.
(b) For all officers, trustees, investors, and owners with more than 5 percent ownership and for the facility manager:
(1) Name, address and amount of ownership.
(2) Responsibility and relationship to the facility.
(3) Previous experience with similar facilities.
(4) Previous business experience.
(5) Any felony convictions against such person in any jurisdiction.
(6) Any court orders or injunctive relief against such person.
(7) Relationships with other nursing homes or like communities.
(8) Previous bankruptcies or financial actions against such person.
(9) Relationship with any supplier or potential supplier of services.
(10) Supplies or materials of any kind contributed or sold to the provider.
(c) The provider's relationship with any religious, charitable, or nonprofit organization and the extent of such organization's financial responsibilities to the provider or to residents.
(d) Whether the provider claims to be nonprofit or tax exempt.
(e) The location and description of the facility and, if it is proposed or incomplete, the estimated completion date, status of construction, and any contingencies on that completion date.
(f) Those services to be provided by the facility under basic contract and those at extra cost.
(g) All locations where services are to be provided, if different from the main facility.
(h) All entrance fees and periodic payments that are required of residents and a description of all policies and conditions for refund or return of these fees and payments.
(i) When and how periodic payments may be changed by the facility.
(j) Provisions of the provider for reserve funding, escrows, and trusts and investment of these funds.
(k) Financial statements audited by a certified public accountant including, if the facility is in operation, a balance sheet and an income statement for the 2 complete and immediately preceding years.
(l) If the facility has not yet begun operating:
(1) All expected costs or obligations.
(2) Full description of all mortgages or long term financing and an analysis of the occupancy rates necessary to pay them together with an analysis showing the number of contracts necessary to make start-up feasible.
(3) Estimated entrance fee income prior to operation.
(4) Estimated start-up losses and reserves to be covered by entrance fees.
(5) Projection of estimated annual income from periodic payments.
(6) Resident mortality and morbidity assumptions.
(7) Analysis of facilities expected to compete with the proposed facility and a demographic analysis of the elderly population expected to support the facility.
(8) All periodic payments a resident will be expected to pay.
(9) Assumptions and bases for estimating occupancy rates.
(10) All expected subsidies, private or government, including Medicaid and Medicare, and the effect if these subsidies are not received.
(11) Projected annual operating expenses.
(12) Estimated capital and equipment replacement expenditures for the current year and the next 5 years. In specific cases, the commissioner may, if he deems necessary, require a longer period of projection of the estimated capital and operating expenses.
(13) All assets pledged as collateral.
(14) Annual payments on long term financing.
(15) Any other commitments over $25,000 to make payments to another party for any purpose.
III. The disclosure statement shall contain any other information deemed necessary by the commissioner.
IV. The cover page of the disclosure statement shall state, in a prominent location and type face, the date of the disclosure statement and that the issuance of a certificate of authority does not constitute approval, recommendation, or endorsement of the facility by the department, nor is it evidence of, nor does it attest to, the accuracy or completeness of the information set out in the disclosure statement.

Source. 1988, 44:2, eff. Jan. 1, 1989.

Section 420-D:5

    420-D:5 Revocation or Suspension of Certificate of Authority; Liens. –
I. The commissioner may revoke, deny, or suspend a certificate upon notice and hearing with written findings of fact if he finds that any of the following conditions exist:
(a) Violation by a provider of any provisions of this chapter or any rule adopted pursuant to it.
(b) Failure to continue to meet the requirements of the certificate of authority.
(c) Lack of any qualifications necessary under this chapter for the certificate of authority.
(d) Failure to file a disclosure statement under RSA 420-D:4 or failure to disclose such to a prospective resident.
(e) Fraud or misrepresentation of a material fact in the disclosure statement.
(f) Failure to comply with a cease and desist order under RSA 420-D:24.
(g) Misappropriation, conversion, or wrongful withholding of money.
(h) A demonstrated lack of fitness or trustworthiness.
(i) Failure to make a new application for certificate of authority in accordance with RSA 420-D:13 when there is a sale, transfer of ownership, or partial ownership, or transfer of control.
(j) Such unsound financial condition or any other practice which may be hazardous or injurious to residents or to the general public.
(k) Failure to maintain a complete list of all entrance fees paid by each resident or prospective resident by the provider or his escrow agent.
(l) Failure to file an annual report in accordance with RSA 420-D:7.
II. If necessary to protect the interests of the residents, the commissioner shall file a lien in accordance with RSA 420-D:9 on the real and personal property of the provider and shall take any other action necessary to protect the residents of the facility.

Source. 1988, 44:2. 2010, 144:7, eff. Jan. 1, 2011.

Section 420-D:6

    420-D:6 Appeal. – Any person, corporation, partnership, or association aggrieved by the action of the commissioner in revoking, suspending, or refusing to grant or reissue a certificate has the right to a rehearing and appeal in accordance with the provisions of RSA 541.

Source. 1988, 44:2, eff. Jan. 1, 1989.

Section 420-D:7

    420-D:7 Annual Reports. –
I. Annually, on or before May 1, a provider certified under this chapter shall submit a report to the commissioner relative to the financial condition of the facility together with any other information required by the commissioner. The commissioner may require more frequent reports of any provider or facility if he or she deems it necessary for proper review. If the provider uses an annual period other than a calendar year, he or she may apply to the commissioner for permission to file on another date which must be within 120 days of the close of this annual period. The commissioner shall approve such a request if the annual period used is prescribed by an appropriate federal agency and shall approve requests that are for the convenience of the provider if it is practicable to do so. A provider shall not change the final date of his or her annual period without prior written approval of the commissioner.
II. The report required under this section shall be in such form as the commissioner shall prescribe and shall include but not be limited to the following information:
(a) The most recent disclosure statement of the facility as required under RSA 420-D:4.
(b) An annual financial statement with an explanation of the differences between previous financial estimates and actual figures for the year.
(c) An estimated financial statement for the new fiscal year with an estimate in case of all major changes expected during the year. The commissioner shall adopt rules under RSA 541-A relative to the definition of major changes. Reports containing the information under this subparagraph shall not be distributed to residents unless prior approval has been obtained from the commissioner.
(d) Financial statements audited by an independent certified public accountant, which shall contain for 2 or more annual periods, at a minimum, the following information:
(1) A balance sheet.
(2) A statement of income and expenses.
(3) A statement of equity or fund balances.
(4) A statement of changes in financial position.
(5) The accountant's opinion.
(6) All notes to the financial statements considered customary or necessary to full disclosure and adequate understanding of the financial statements, the financial condition of the facility, and the operation.
(7) Such other reasonable data, financial statements, and pertinent information as the commissioner may by rule prescribe.
III. The annual statement shall be sworn to in writing by the principal officer or officers of the provider as follows:
(a) If an individual owner, by him;
(b) If a limited partnership, by the general partner;
(c) If a partnership, by all the partners;
(d) If an unincorporated association, by all its members or by all its officers and directors;
(e) If a trust, by all its trustees and officers; or
(f) If a corporation, by the president and the secretary.
IV. Notwithstanding paragraph II, the commissioner shall not prescribe by rule or otherwise require submission of an actuarial report from any facility which does not offer a contract in which all or part of the risk of uncertain future health care costs is borne by the facility and not the resident.

Source. 1988, 44:2. 2010, 144:8, eff. Jan. 1, 2011. 2016, 111:5, eff. May 20, 2016; 150:1, eff. July 26, 2016. 2019, 113:8, eff. Aug. 20, 2019.

Section 420-D:8

    420-D:8 Liquid Reserves. – Liquid reserves of each facility subject to this chapter shall be maintained equal to 12 months' principal and interest payments plus that portion of 2 months' operating expenses which relates to life care residents. Other reserves or trust accounts under the exclusive control of the provider shall be considered in making this determination. The commissioner may adopt rules pursuant to RSA 541-A relative to the definition of liquid reserves. The commissioner may require liquid reserves to be placed in escrow and shall prescribe escrow conditions and shall approve the escrow agent. If the provider contracts with any resident to return any portion of the entrance fee to such resident or his estate, the commissioner may make a finding if necessary to protect the best interests of the resident that a reserve be established by the provider in accordance with rules adopted by the commissioner.

Source. 1988, 44:2, eff. Jan. 1, 1989.

Section 420-D:9

    420-D:9 Lien on Behalf of Residents. – The commissioner shall file a lien on all real and personal property of a provider if he deems it necessary to protect the interests of the residents. Notices of liens upon real property shall be filed in the registry of deeds of the county in which the real property subject to the liens is situated. The register of deeds shall receive, record, and index the same in accordance with RSA 478. The filing and service of the notice and demand of said lien shall constitute a lien upon the real estate, personal estate, property interest, right, or credit to which the notice and demand relates or which may be subsequently discovered. Such lien shall be effective for the period determined necessary by the commissioner and may be renewed if the circumstances warrant it. A lien shall only be foreclosed to protect the investment of residents, and the proceeds shall be distributed in a manner to satisfy any continuing care contracts in effect at that time.

Source. 1988, 44:2. 2010, 144:9, eff. Jan. 1, 2011. 2022, 42:15, eff. July 2, 2022.

Section 420-D:10

    420-D:10 Entrance Fee Escrow Account. –
I. An escrow account for entrance fees shall be established and approved by the commissioner before a certificate of authority under this chapter shall be issued. Entrance fees paid by prospective residents before occupancy of a facility living unit or by prospective residents under a contract issued pursuant to RSA 420-D:3-a, and which total over $1,000 shall be placed in this account. All entrance fees subject to this section shall be placed in the account on the first working day after receipt. Interest on such fees shall be paid at the current market rate as established by the commissioner to the prospective resident if the resident is not allowed by the provider, for any reason, to enter the facility, provided however if the entrance fee is paid pursuant to a contract under RSA 420-D:3-a, the entrance fee shall be returned to the consumer with interest, if the contract is not signed or the consumer exercises the right of rescission under RSA 420-D:12, I(m).
II. The provider shall deliver to the escrow agent the sum total of all entrance fees paid in for each resident or prospective resident. A list of the names, addresses, and sum totals of all entrance fees paid by each resident or prospective resident shall be maintained by the provider or the escrow agent for the provider. If an entrance fee has been paid by another on behalf of a resident, a statement shall be included as to whom the amount in escrow is to be returned to, should return become necessary.
III. Release of escrowed amounts to the provider shall be made as follows:
(a) For living units that have been previously occupied, when the new resident makes the first monthly payment.
(b) For living units not previously occupied:
(1) When aggregate fees received or receivable equal 50 percent of total entrance fees due at full occupancy, except that any entrance fee payments that are less than 35 percent of the amount due from a resident will not be counted; or
(2) When entrance fees plus proceeds of any first mortgage or other long term loan in lieu of a first mortgage plus other funds on hand equal 1/2 of the total cost of the facility, plus 1/2 of the start-up losses shown in the certificate of authority application; or
(3) When a permanent mortgage or other long term loan commitment has been received and the mortgagee's commitment conditions prior to disbursement have been satisfied, other than completing construction and closing purchase.
(c) For a resident that has not moved into the facility pursuant to RSA 420-D:3-a, 10 days after the contract is fully executed by all parties.
IV. The escrow agent shall return funds, including all interest, to the person who originally made the payment to the provider, if the funds so deposited are not released to the provider under the conditions enumerated in paragraph I or II within 3 years of the escrow date. The commissioner may extend this period for up to 2 years upon written application by the provider.
V. The escrow provisions under this chapter shall not apply to nonrefundable application fees that do not exceed one month's periodic payments for services rendered by the provider.
VI. If approved by the commissioner, a provider may post bond, negotiable securities, or a letter of credit with the commissioner in lieu of escrow. The institution providing a bond or a letter of credit must meet all requirements of and have the full approval of the commissioner. The amount of the bond, negotiable securities, or letters of credit shall be in the same amount as if the funds received from residents or prospective residents had been placed in escrow. Under this paragraph, a record of persons who made entrance fee payments and the amount of such payments shall be maintained as required under paragraph I of this section.
VII. An escrow agent shall return funds to the person, or the estate of the person if deceased, who paid the entrance fee, if requested by the provider. A request to return funds to any other person shall be approved by the commissioner.

Source. 1988, 44:2. 2010, 144:10, 11, eff. Jan. 1, 2011.

Section 420-D:11

    420-D:11 Pledging Assets. – Only unencumbered assets of a facility may be pledged as collateral for another facility.

Source. 1988, 44:2, eff. Jan. 1, 1989.

Section 420-D:12

    420-D:12 Contracts With Residents. –
I. Each contract between a provider and a resident shall:
(a) Be written in plain, non-technical language.
(b) Cover only one resident, or 2 if sharing the same unit, and shall include the total amount transferred by the resident, or on behalf of the resident, to the provider. If securities or real or personal property are transferred to the provider instead of cash, the provider shall describe exactly the securities, property, or other goods transferred and the market value of securities or the professional appraised value of property or goods as of the date they were tendered.
(c) State specifically and in full detail all services and items to be provided to the resident including the locations where services and items will be provided, the duration of such services, and how often they are to be provided. The contract shall also describe which services or items are included in the agreement for continuing care and which services or items will be made available by the provider at an extra cost to the resident.
(d) State the conditions upon which the provider may evict a resident or terminate the contract for continuing care and the conditions upon which a resident may terminate his or her residency or terminate the contract for continuing care. A statement as to what portion of the entrance fee shall be returned under each condition shall also be included in accordance with RSA 420-D:12, II.
(e) Describe conditions required for a person to continue as a resident.
(f) Describe any conditions under which a person delinquent in his or her periodic payments may remain and if there is a specific time limit.
(g) State the entrance fees and periodic payment changes that may occur if a resident marries or if a spouse joins a resident in a living unit. It shall also state the fee changes that may occur if either one of the 2 people who occupy the same living unit dies or otherwise leaves that living unit.
(h) Describe the terms and conditions under which a provider or a resident may cancel an agreement for continuing care. The contract shall also state that a minimum of 30 days' notice of cancellation must be given, except that a written medical finding by 2 doctors that a resident is a danger to himself or others shall require only reasonable notice.
(i) Describe in clear detail all the terms under which a contract is cancelled upon the departure or death of a resident.
(j) State the basis upon which the entrance fees are earned by the provider at the death of a resident, what portion, if any, shall be turned over to the estate of the resident, and the formula for calculating all amounts earned by the provider.
(k) Describe the conditions under which periodic payments may change. The contract shall state that a 60-day notice is required before a change in periodic payments shall take effect, except those periodic payments required by federal or state assistance programs.
(l) State that periodic payments for care paid in a lump sum shall not be changed during the period covered, unless the resident is receiving federal or state assistance and the change is mandated by those programs.
(m) Provide a period of 10 days during which a prospective resident may cancel a contract and have his deposit returned and that there is no requirement to move in during those 10 days.
(n) Provide that, within the 10 days under subparagraph (m), the provider shall make a full refund of all money, securities, goods, or property tendered by the prospective resident, except for any non-refundable initial application fee that does not exceed one month's periodic charges and any payments for actual services or goods provided to the prospective resident.
(o) Describe under what conditions a resident may be transferred to another living unit or another part of the facility together with the financial adjustments to be made as a result of such changes.
(p) Provide for full refund, except any initial non-refundable application fee of less than one month's periodic payment, if, before occupancy, death occurs or if there is a medically certified incapacity to move in.
II. (a) No contract issued pursuant to this section shall allow dismissal of a resident prior to the end of a contractual period, except for just cause in written form or if 2 doctors, one of whom is not an employee or associated with the facility, find that the resident is a danger to himself or to others. In such cases, the minimum refund shall be the unearned portion of the entrance fee in the contract with the resident.
(b) The commissioner or his designee shall intervene prior to a dismissal if so requested by the resident. If the commissioner finds that a resident is being or has been unjustly dismissed, he may, in his capacity as the intervenor, order the return of the entire entrance fee or take any other necessary action on behalf of a resident.

Source. 1988, 44:2. 2010, 144:12, eff. Jan. 1, 2011.

Section 420-D:13

    420-D:13 Transfer or Sale of Interest. –
I. Any provider who plans to sell or otherwise transfer control, whether partial or entire, or an interest in the management or assets of a continuing care community certified under this chapter shall notify the commissioner of the proposed change. The notification shall specify the amount of interest involved in the transfer, the type of transfer, and to whom. The commissioner may refuse to approve such transfer until full disclosure has been made, to his satisfaction, of the terms and conditions of the transfer and he has determined that such transfer is in the best interests of the residents and the state of New Hampshire.
II. If the commissioner determines that management control or more than 50 percent of the assets of the facility have been or are about to be transferred to another party, he shall cancel the existing certificate of authority and require that an application for a certificate of authority be submitted by the new provider within 30 days.
III. [Repealed.]

Source. 1988, 44:2. 1999, 249:6, II, eff. Sept. 7, 1999.

Section 420-D:14

    420-D:14 Waiver Prohibited. – Contracts entered into prior to the date the provider receives the certificate of authority are valid and binding for those providers offering or providing continuing care on January 1, 1989; except that a resident or a prospective resident who has signed a contract prior to that date may request that his contract with the provider be changed to conform with the provisions of this chapter. However, any changes made to such contracts after the date when rules adopted by the commissioner in accordance with RSA 420-D:17 take effect shall conform to all provisions of this chapter and such rules.

Source. 1988, 44:2, eff. Jan. 1, 1989.

Section 420-D:15

    420-D:15 Right to Organize and to Obtain Outside Consultation. –
I. All residents have the right to self-organize, the right to be represented by an individual of their own choice, and the right to engage in concerted activities for their own purposes. They shall have the right both individually and severally to obtain outside advice and consultation of their own choosing on any matter, including, but not limited to, medical, legal, and financial matters.
II. A provider shall be available for meetings at least once each quarter of the year with residents or their representative. The meetings shall be for the purpose of providing a forum for free and open discussion of any point either wishes to discuss. If requested, the manager of a facility shall be present at such meetings, and the residents' organization may also request that an owner, partner, director, or other official of the provider operating the facility be present. Residents shall be given at least 2 weeks' notice of each such meeting.

Source. 1988, 44:2, eff. Jan. 1, 1989.

Section 420-D:16

    420-D:16 Rehabilitation or Liquidation. –
I. The commissioner may, if it is in the best interest of the residents, petition the appropriate court to appoint a trustee to rehabilitate or liquidate a facility. Such rehabilitation or liquidation shall occur only if the commissioner finds, after proper notice and hearing, any of the following:
(a) That a provider is insolvent or bankrupt or in danger of becoming insolvent or bankrupt.
(b) That a provider has failed to maintain required liquid reserves under RSA 420-D:8.
(c) That any part of the reserve fund escrow amount under RSA 420-D:10 has been or is about to be released in violation of RSA 420-D:10.
(d) That a provider has been or is about to become unable to meet the cash flow or income projections for the period.
(e) That the certificate of authority has been suspended or revoked.
(f) That the provider named in a certificate has sold a majority interest or transferred management control to others without prior notification and approval by the commissioner.
II. A rehabilitation order shall authorize the commissioner, or the trustee, to take possession of the property of the provider, including all facilities owned by the provider within the state, to operate, including the employment or discharge of any facility employees as he may determine necessary, and to manage and take other measures the court may direct as necessary. The commissioner, trustee, provider, or the court on its own motion may petition for removal of a rehabilitation order and return the management of the facility to the provider, if the provider demonstrates that the objectives of the original order have been met and that no further jeopardy to the residents exists.
III. If attempts to rehabilitate the facility fail, the commissioner may apply to the court for an order to liquidate. A liquidation order, however, shall not require a prior rehabilitation order. An order to liquidate shall automatically revoke the certificate of authority for all facilities of the provider and shall include an order to liquidate all facilities owned by such provider.
IV. In applying for an order to rehabilitate or liquidate, the commissioner shall consider the best interests of the residents who have contracted for continuing care at the facility. The proceeds of liquidation shall be paid to other providers as full or partial entrance fees for the affected residents or shall otherwise be used on behalf of the residents of the facility being liquidated. Except as provided in paragraph V of this section, in the event of liquidation, all continuing care agreements with a provider shall be deemed preferred claims against the assets of the provider.
V. A provider may avoid a rehabilitation order by posting a bond in an amount which is satisfactory to the commissioner. The bond shall be from a maker in this state who is acceptable to the commissioner and shall be in favor of the commissioner on behalf of those entitled to refunds or damages. It shall be in an amount sufficient to cover any refunds due the residents plus other amounts as determined necessary by the commissioner to protect the residents. Nothing in this chapter shall be construed to impair the priority, with respect to the lien property, of mortgages, security agreements, lease agreements, or installment sales agreements on property not otherwise encumbered which have been entered into by a provider with an issuer of bonds or notes and bonds which are secured by a resolution, ordinance, or indenture of trust if such mortgages or agreements were duly recorded at least 4 months prior to the institution of liquidation proceedings.

Source. 1988, 44:2, eff. Jan. 1, 1989.

Section 420-D:17

    420-D:17 Rulemaking. –
The commissioner shall adopt rules pursuant to RSA 541-A and after public hearing, relative to:
I. Procedures for application for a certificate of authority under RSA 420-D:2.
II. [Repealed.]
III. Any application fees required under RSA 420-D:2.
IV. Procedures and fees for the renewal process under RSA 420-D:3.
V. Manner of filing and any other information to be contained in the disclosure statement required under RSA 420-D:4.
VI. Procedures for revocation or suspension of a certificate of authority under RSA 420-D:5.
VII. Procedures for hearings and notice requirements under this chapter.
VIII. Manner of filing and other information to be contained in the annual report required in RSA 420-D:7.
IX. The definition of major changes under RSA 420-D:7, II(c).
X. The definition of liquid reserves as required under RSA 420-D:8.
XI. Escrow conditions for liquid reserves under RSA 420-D:8.
XII. Procedures for obtaining and extending liens under RSA 420-D:9.
XIII. Procedures for placing entrance fees in escrow accounts and for releasing such fees under RSA 420-D:10.
XIV. The manner and content of all forms required under this chapter.
XV. What shall constitute cause for intervention under RSA 420-D:12, II.
XVI. A schedule of fees to cover the costs of administering this chapter.
XVII. Continuing care facilities under the division of charitable trusts in accordance with RSA 420-D:2, III.
XVIII. [Repealed.]

Source. 1988, 44:2; 44:6. 1999, 249:6, III, eff. Sept. 7, 1999.

Section 420-D:18

    420-D:18 Dividends. – A provider subject to this chapter shall obtain prior approval from the commissioner before declaring and distributing any dividends or funds or other assets to owners.

Source. 1988, 44:2, eff. Jan. 1, 1989.

Section 420-D:19

    420-D:19 Repealed by 2001, 276:6, II, eff. Sept. 14, 2001. –

Section 420-D:20

    420-D:20 Civil Liability. –
I. In the following circumstances, a provider or his agent shall be liable for damages, entrance fees with any accrued interest, and attorneys' fees, plus any other fees paid in advance of receipt of services:
(a) If the provider or agent enters into contracts for continuing care for a facility that does not have a certificate of authority under this chapter;
(b) If he did not deliver a disclosure statement before entering into a contract; or
(c) If a disclosure statement is misleading and induces acceptance of a contract for continuing care or induces payment of any money or transfer of anything of value by a resident or prospective resident.
II. Negligent misrepresentation or omission shall not preclude recovery under this section.
III. An action pursuant to this section may be avoided if the provider, upon written approval of the commissioner, makes a good faith offer to refund all fees and costs listed in paragraph I. Failure of a resident or prospective resident to accept such an offer within 60 days shall preclude further action by such resident or prospective resident. Any action brought pursuant to this section shall be in accordance with applicable state law. An action brought under this chapter shall not limit the liability of the provider under other state laws. A private party shall not be liable by implication unless expressly permitted under this chapter.

Source. 1988, 44:2. 1999, 249:3, eff. Sept. 7, 1999.

Section 420-D:21

    420-D:21 Investigations; Subpoenas. – The commissioner may make such investigations as he or she deems necessary both within and outside the state in accordance with the provisions of RSA 400-A:16 and RSA 400-A:20 through RSA 400-A:22.

Source. 1988, 44:2, eff. Jan. 1, 1989. 2016, 111:6, eff. May 20, 2016.

Section 420-D:22

    420-D:22 Records and Assets to be Kept Within State. – All records and assets of a provider shall be established and kept in the state of New Hampshire and shall not be removed from this state by a provider or his agent unless agreed to in writing by the commissioner prior to such removal. The commissioner shall consent to such removal only if the provider submits satisfactory evidence that the removal will facilitate a more economical operation and will not diminish the service or protection given to the residents remaining in this state. The commissioner may order the return of the records and assets if such return is in the best interests of the residents or of the state.

Source. 1988, 44:2, eff. Jan. 1, 1989.

Section 420-D:23

    420-D:23 Audits. – The commissioner or the commissioner's agent shall audit the books and records of a facility subject to this chapter once every 5 years, or more frequently as the commissioner deems necessary to assure the accuracy of reports to him or her taking into consideration other independent audits required under this chapter.

Source. 1988, 44:2. 2002, 207:9, eff. July 15, 2002.

Section 420-D:24

    420-D:24 Cease and Desist Orders. – If it appears that any person subject to this chapter has engaged or is about to engage in acts violating this chapter or any rule adopted pursuant to it, the commissioner may issue an order to cease and desist and bring court action to enforce compliance or enjoin such action. Upon proper request, a court may issue a permanent or temporary injunction, restraining order, or writ of mandamus, and a receiver or conservator may be appointed for the defendant or the defendant's assets. The commissioner shall not be required to post bond.

Source. 1988, 44:2, eff. Jan. 1, 1989.

Section 420-D:25

    420-D:25 Fees. – The commissioner shall charge providers subject to this chapter a fee for services rendered to them by the department of insurance. The fees shall be established and adopted by rule under RSA 541-A and shall be sufficient to cover the costs of administering this chapter.

Source. 1988, 44:2, eff. Jan. 1, 1989.

Section 420-D:26

    420-D:26 Criminal Penalties. – Any person, partnership, association or corporation, including state or county or local governmental units or any division, department, board or agency thereof, establishing, conducting, managing, or operating any facility within the meaning of this chapter without first obtaining a certificate as provided in this chapter, or who violates any rule adopted under this chapter, shall be guilty of a misdemeanor if a natural person, or guilty of a felony if any other person. Nothing in this section shall preclude any other action at law against such person.

Source. 1988, 44:2, eff. Jan. 1, 1989.

Section 420-D:27

    420-D:27 Severability. – If any provision of this chapter or the application thereof to any person or circumstance is held invalid, the invalidity does not affect other provisions or applications of the chapter which can be given effect without the invalid provisions or application, and to this end the provisions of this chapter are severable.

Source. 1988, 44:2, eff. Jan. 1, 1989.