CHAPTER Ins 1800 CONTINUING CARE
RETIREMENT COMMUNITIES
Statutory
Authority: RSA 400-A:15; RSA 420-D:17
PART Ins 1801 PURPOSE AND SCOPE
Ins 1801.01 Purpose. The purpose of this chapter is to implement
RSA 420-D wherein the general court has provided for the regulation of
continuing care retirement communities in order to protect the older citizens
of the state.
Source. #4666, eff 8-22-89; ss by #5654, eff 7-1-93;
ss by #7014, eff 7-1-99, EXPIRED: 7-1-07
New. #8991, eff 10-1-07; ss by #10944, eff 10-8-15
Ins 1801.02 Scope. This chapter shall apply to all continuing
care retirement communities.
Source. #4666, eff 8-22-89; ss by #5654, eff 7-1-93;
ss by #7014, eff 7-1-99, EXPIRED: 7-1-07
New. #8991, eff 10-1-07 ss by #10944, eff 10-8-15
PART Ins 1802 DEFINITIONS
Ins 1802.01 Definitions.
(a) For the
purposes of this chapter, the definitions appearing under RSA 420-D:1 shall
apply whenever any word or phrase defined under RSA 420-D:1 is used in this
chapter.
(b) With respect to the following words or
phrases used in this rule, but which are not defined under RSA 420-D:1, the following definitions shall apply:
(1) "Escrow date", as used in RSA
420-D:10, IV, means the date entrance fees subject to RSA 420-D:10 are placed
in an escrow account pursuant to RSA 420-D:10, I.
(2)
"Continuing Care Retirement Community (CCRC)" means any facility or
other entity providing continuing care and soliciting
(3) "General court" means the assembled
senate and house of representatives of the state of
(4) "Health
care provider" means any physician, hospital, nursing home, visiting nurse
association or any other institution, organization or person who furnish health
care services.
(5) “Health care services” means “health care
services” as defined in RSA 420-C:2, V.
(6) "Major changes", for the purposes
of RSA 420-D:7, II(c), means any change in or affecting the operation of the
CCRC which causes or is estimated to cause an increase or decrease of 10
percent or more in any line item appearing on either the balance sheet,
statement of income and expenses or the statement of changes in financial
position submitted as part of the CCRCs annual report required by RSA 420-D:7,
I. The term does not include an increase
or decrease in any line item of less than $1,000, the percentage increase or
decrease notwithstanding.
(7) "Market value" means, with respect to
any security or other asset which is tradable on a recognized financial
exchange, the closing price as of the last day the security or other asset was
traded on the exchange where the majority of trading in the security or other
asset takes place.
(8) "National
Association of Insurance Commissioners (NAIC)" means the organization of
insurance regulators from the 50 states, the
(9) “Operating expenses” means total expenses
less depreciation and amortization expenses.
Source. #7014, eff 7-1-99, EXPIRED: 7-1-07
New. #8991, eff 10-1-07; ss by #10944, eff 10-8-15
PART Ins 1803 CERTIFICATE OF
AUTHORITY
Ins 1803.01 Application
Procedures.
(a) All CCRCs seeking a certificate of authority
shall file an application with the insurance
department.
(b) In addition to the information specified in
(c) below, the following additional
information or supporting material shall accompany each application:
(1) The disclosure statement as described under
RSA 420-D:4 and Ins 1808;
(2) A statement
indicating any other state or federal licensure or certification which the
continuing care facility may have or be required to have and the current status
of such licensure or certification;
(3) The appropriate application fee pursuant to
Ins 1809;
(4) Notarized documents, which shall include the name,
address, telephone number and principal business activities of the escrow
agent, indicating that an escrow account for entrance fees has been
established, when RSA 420-D:10 requires an escrow account for these fees.
(c) As part of the application process all CCRCs
shall provide a biographical
affidavit notarized by a notary public, from any officer, trustee, investor,
owner with more than 5 percent ownership, or executive director, or equivalent
title, who is not an officer or trustee, that shall include the following:
(1) The name and address of the continuing care
provider;
(2) The name of the affiant;
(3) A listing of other names used by the affiant
at any time and the reason for, any name changes, if any, for the affiant;
(4) The affiant's business address and telephone
number;
(5) The educational background of the affiant,
including the name and location of colleges or universities attended, the dates
of attendance, and any degrees earned;
(6) A listing of the affiant's membership in professional
societies and associations;
(7) The affiant's present or proposed position
with the provider;
(8) A listing of the complete employment record of
the affiant up to and including present jobs, positions, directorates, or
officerships for the past 10 years giving the dates of employment, the name and
address of each employer and the job title held;
(9) A statement as to whether or not the present
employer may be contacted;
(10) A statement as to whether or not former
employers may be contacted;
(11) A statement as to whether or not the affiant
has ever been in a position which required a fidelity bond;
(12) If the answer to (11) above is affirmative,
and if any claims were made on the bond, the affiant shall state the details of
each such claim;
(13) A statement as to whether or not the affiant
has ever been denied an individual or position schedule fidelity bond or if any
such bond has ever been cancelled or revoked;
(14) If the answer to (13) above is affirmative, a
statement as to the details of each denial, cancellation or revocation;
(15) A listing of the professional, occupational,
and vocational licenses issued by any public or governmental licensing agency
or regulatory authority which the affiant presently holds or has held in the
past, including the date the license was issued, the issuer of the license, the
date the license was terminated and the reason for termination;
(16) A statement as to whether or not the affiant
has, within the last 10 years, been refused a professional, occupational, or
vocational license by any public or governmental licensing agency or regulatory
authority, or had any such license held suspended or revoked;
(17) If the answer to (16) above is affirmative,
the affiant shall state the details of each denial, cancellation, or
revocation;
(18) A listing of the continuing care providers or
health care facilities in which the affiant controls, directly or indirectly,
or owns legally or beneficially 10 percent or more of the outstanding voting
stock, in voting power;
(19) A statement by the affiant as to whether the
affiant or members of his or her immediate family will subscribe to or own,
beneficially or of record, any shares of stock in the continuing care provider
or in any affiliate of the continuing care provider;
(20) If any of the shares or stock noted in the
answer to (19) above are pledged or hypothecated in any way, the affiant shall
provide an explanation of these circumstances;
(21) A statement by the affiant as to whether or
not he or she has ever been adjudged bankrupt;
(22) A statement by the affiant, and details of if
affirmative, as to whether the affiant has ever been convicted or had a
sentence imposed or suspended or had pronouncement of a sentence suspended or
been pardoned for conviction of or pleaded guilty or nolo contendre to an
information or indictment charging any felony, or charging a misdemeanor
involving embezzlement, theft, larceny, or mail fraud, or charging a violation
of any corporate securities statute or any insurance law;
(23) Whether the affiant has ever been the subject
of any disciplinary proceedings of any federal or state regulatory agency, and
details if affirmative;
(24) A statement by the affiant as to whether or
not any company has ever been charged as in (22) above, allegedly as a result of
any action or conduct on the part of the affiant;
(25) A statement by the affiant as to whether or
not the affiant has ever been an officer, director, trustee, investment
committee member, key employee, or controlling stockholder of any company or
organization which, while the affiant occupied any such position or capacity
with respect to it, became insolvent or was placed under supervision or in
receivership, rehabilitation, liquidation or conservatorship;
(26) A statement by the affiant, and details if
affirmative, as to whether or not the certificate of authority or license to do
business of any provider or company of which the affiant was an officer, or
director or key management person has ever been suspended or revoked while the
affiant occupied such position; and
(27) A dated signature of the affiant by which the
affiant certifies that he or she is acting on his or her own behalf and that
the foregoing statements are true and correct to the best of the affiant's
knowledge and belief.
(d) The applicant shall provide the following
information in the application:
(1) The name of the continuing care facility;
(2) The type of business organization of the
continuing care facility;
(3) Under which state's laws the facility is
organized;
(4) The facility's home address, if within the
(5) The principal mailing address;
(6) Whether the department ever issued a
temporary certificate of authority to the applicant and, if yes, the date of
expiration;
(7) Certification that the applicant, if issued a
certificate of authority, will abide by the applicable rules of the department;
(8) Certification that the applicable
requirements of RSA 420-D have been met;
(9) Whether the license or authority of the CCRC
facility, or affiliated facility of a controlling organization, has ever been
revoked, suspended or canceled in any jurisdiction;
(10) Whether any previous application of the CCRC
facility, or affiliated facility of a controlling organization, for a license
or authority has been denied in any jurisdiction;
(11) If an affirmative answer is given to the
information requested in (9) or (10) above, the details of any revocation,
suspension, cancellation or denial; and
(12) Authorized signature indicating that, to the
best of the signer's knowledge and belief, the information in the application
is true and complete, and the signer’s printed name and title, and the date
signed.
(e) The commissioner shall act upon applications
received within a reasonable time, as set forth in RSA 541-A:29,II(a).
(f) CCRCs who have applications pending shall
keep their application and any accompanying information or supporting material
current, and file any amendments or other changes on a timely basis.
(g) Any applicant whose application is rejected
shall be entitled to a hearing in accordance with the provisions of RSA 541,
RSA 541-A and Ins 200 and shall be so notified.
Source. #7014, eff 7-1-99, EXPIRED: 7-1-07
New. #8991, eff 10-1-07; ss by #10944, eff 10-8-15
Ins 1803.02 Revocation or
Suspension.
(a) The commissioner shall not revoke or suspend
a certificate of authority issued to any CCRC except upon notice and hearing
and written findings of fact that one or more of the conditions specified in
RSA 420-D:5,I exist.
(b) Any hearing which the commissioner shall
convene in order to exercise the power granted by RSA 420-D:5 shall be
considered as an "adjudicative proceeding" as defined under RSA
541-A:1, I.
(c) Such proceedings shall be governed by the
following:
(1) In proceeding against any CCRC for the
purpose of revoking or suspending its certificate of authority, the
commissioner shall provide the CCRC with reasonable notice of hearing. Such
notice of hearing shall be in accordance with RSA 541-A:31, III and Ins 200;
(2) Hearings conducted pursuant to RSA 420-D:5
and this section shall be conducted pursuant to all relevant provisions of RSA
541-A and Ins 200;
(3) Any prehearing conferences shall be held
pursuant to Ins 200; and
(4) The findings of the hearing officer and any
order upon such findings shall be made pursuant to RSA 541-A:35 and Ins 200.
(d) When pursuant to RSA 420-D:5, I(j) the
commissioner finds that a condition that is hazardous or injurious to residents
or to the general public requires emergency action, the commissioner, as
authorized under RSA 541-A:30, III shall order an immediate suspension of a
certificate of authority. In so doing,
the commissioner shall proceed according to Ins 200.
(e) Requests for rehearings shall be made in
writing and shall be made pursuant to the provisions of RSA 541. All appeals from orders issued by the hearing
officer shall be made pursuant to the provisions of RSA 541.
Source. #7014, eff 7-1-99, EXPIRED: 7-1-07
New. #8991, eff 10-1-07; ss by #10944, eff 10-8-15
PART
Ins 1804 ANNUAL REPORTS
Ins
1804.01 Annual Reports.
(a) Each CCRC who uses the calendar year as its fiscal
year shall submit a report on or before May 1 of each year, detailing its
fiscal status as of the close of business on December 31 of the just completed
calendar year.
(b) Each CCRC who uses an annual period other
than the calendar year as its fiscal year shall submit a report detailing its
financial status as of the close of business on the last day of its fiscal year
within 120 days after the close of the fiscal year.
(c) CCRCs holding one or more certificates of
authority shall file separate annual statements for each certificate held.
(d) The annual report required from each CCRC
pursuant to this section shall include the following:
(1) The most recent disclosure statement of the
CCRC as required under RSA 420-D:4;
(2) Financial statements audited by an
independent certified public accountant, which shall contain for 2 or more
annual periods, at a minimum, the following information:
a. A balance sheet;
b. A statement of income and expenses;
c. A statement of equity or fund balances;
d. A statement of changes in financial position;
e. The accountant's opinion; and
f.
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;
(3) For the first full fiscal year wherein the CCRC
has been occupied by one or more residents and for every 5 years thereafter, an
actuarial report, including a balance sheet and statement of operations,
prepared in accordance with the “Actuarial Standard of Practice No. 3,
Practices Relating to Continuing Care Retirement Communities” adopted July,
1994 by the American Academy of Actuaries’ Actuarial Standards Board; and
(4) If applicable, a statement of entrance fee
escrow account balances which shall include the following:
a. The date on which the just completed fiscal
year ended;
b. The name of the provider;
c. The city or town in which the provider is
located;
d. The escrow account balances as of the
beginning of the fiscal year;
e. The escrow payments received during the
fiscal year;
f. Interest credited to account balances;
g. Payments made to residents, prospective
residents or beneficiaries;
h. Interest released to the provider;
i. Entrance fees earned; and
j. The escrow account balances as of the end of
the fiscal year.
(e) Upon written notice to the CCRC, the
commissioner shall require the CCRC to submit any one or more of the financial
statements listed under (d) above on a more frequent basis than annually, when any of the following conditions
apply:
(1) The annual reports for the most recently
completed fiscal year show that the CCRC operated a loss greater than 5 percent
of the monthly maintenance fees received;
(2) The annual reports for the most recently
completed fiscal year showed a total surplus equal to less than 10 percent of
total assets;
(3)
The annual reports for the most recently completed fiscal year estimated a loss
for the succeeding year greater than 5 percent of the estimated monthly
maintenance fee revenues;
(4) The annual reports for the most recently
completed fiscal year showed a decrease in assets of more than 5 percent or an
increase in liabilities of more than 10 percent; and
(5) An audit conducted by the commissioner
results in a change in surplus of 25 percent or more.
(f) Upon written notice to the CCRC, the
commissioner shall require the CCRC to submit any journals, ledgers or other
records which serve as back-up material for any one or more of the financial
statements listed under (d) above. The
commissioner shall make such requests whenever it is necessary to verify the
accuracy of the financial statements included as part of the CCRCs annual
report.
(g) To be considered complete upon submission,
the financial statements listed under (d) above shall include complete answers
to all general interrogatories and all notes to the financial statements which
are considered customary or necessary to full disclosure and adequate
understanding of the financial statements, the financial condition of the CCRC,
and the operation of the CCRC.
(h) The financial statements required by (d) (3)
above shall be accompanied by a statement of actuarial opinion indicating
whether the data and assumptions used are appropriate, whether the methods
employed are consistent with sound actuarial principles and practices and
whether provisions have been made for all actuarial liabilities and related
statement items which ought to be established.
(i) The actuarial opinion shall also contain
appropriate comment on the CCRCs perceived ability to operate the CCRC as a
going concern and the impact of any actuarial deficit. If the actuary is unable to form a needed
opinion, or if the opinion is adverse or qualified, the statement of actuarial
opinion shall specifically state the reason.
The actuarial opinion shall be rendered by a qualified actuary as
defined in Ins 901.02.
Source. #7014, eff 7-1-99; amd by #7994, eff 12-1-03;
ss by #8991, eff 10-1-07; ss by #10944, eff 10-8-15
PART Ins 1805 LIQUID RESERVES
Ins 1805.01 Liquid Reserves.
(a) When a CCRC calculates whether the value of its
liquid reserves meets the amount RSA 420-D:8 requires, the CCRC may include the
values of the assets listed below:
(1) Cash held in an account of a financial
institution;
(2) The following assets that can be liquidated,
based upon the net value after liquidation:
a. Certificates of deposit issued by a financial
institution;
b. Money-market funds issued by an
"investment company" as defined by U.S.C. Title XV, Section 80a-3;
c. Acceptable negotiable securities which shall
include only United States government obligations and corporate debt
obligations rated A or above in Moody's or Standard and Poor's corporate bond
rating publication or a 1 or 2 rating by the NAIC valuation of securities
publication; and
d. Commercial paper in the form of promissory
obligations of an issuer with an original maturity date not exceeding 9 months
from the date of issuance, having the highest rating in a rating publication
indicated in c. above.
(b) For the purpose of determining whether the
assets included in the liquid reserve account of a CCRC satisfy the liquid
reserve requirement of RSA 420-D:8, such assets held in the form of cash shall
be valued at their actual value in U.S. currency. Assets held in any other form
shall be valued at their market value.
(c) For the purpose of determining the amount of
the liquid reserve that a CCRC shall maintain, the term "12 months
principal and interest payments" appearing in RSA 420-D:8 means the CCRCs
liabilities which would be reported to show the statutory liquid reserve as of
the end of current year on the balance sheet that would be included with the
actuarial report, as required by Ins 1804, as if an actuarial report had been
prepared for the 12 calendar months ending on the last day of the previous
month.
(d) For the purpose of determining the amount of
the liquid reserve that a CCRC shall maintain, the term "that portion of 2
months' operating expenses which relates to life care residents" appearing
in RSA 420-D:8 means the amount of the estimated operating expenses for the 2
calendar months following the current month.
(e) The liquid reserve required at any point in
time shall be the sum of the amounts determined in accordance with (c) and (d)
above. This amount shall be referred to as the minimum liquid reserve.
(f) The commissioner shall require placement of
the liquid reserve in an escrow account whenever the commissioner finds through
an audit that a CCRC is experiencing financial difficulty.
(g) For the purpose of (f) above, financial
difficulty shall include, but not be limited to, any one or more of the
following circumstances:
(1) Payments on accounts payable or notes payable
being made on average 45 days or more after the due date;
(2) A tax lien is filed against the CCRC;
(3) Fifty percent of accounts receivable, except
Medicare or Medicaid, average more than 45 days; and
(4) Days-cash-on-hand drops below 100 days.
(h) All such escrow accounts shall comply with
the rules for entrance fee escrow accounts as set forth under Ins 1807. In
the course of establishing an escrow account, the CCRC shall advise the
commissioner as to the name, address, telephone number and principal business
activities of the escrow agent. The CCRC
shall notify the commissioner of any subsequent change in escrow agent by
providing the name, address, telephone number and principal business activities
of the new escrow agent within 5 business days.
Source. #7014, eff 7-1-99, EXPIRED: 7-1-07
New. #8991, eff 10-1-07; ss by #10944, eff 10-8-15
Ins 1805.02 Days-Cash-On-Hand Calculation.
(a) “UC” means unrestricted current and
noncurrent cash.
(b) “BTHR” means bond or lender held reserve
funds.
(c) “IN” means investments.
(d) “Ex” means operating expenses.
(e) “Dep” means depreciation.
(f) “Am” means amortization.
(g) To calculate days-cash-on-hand, the commissioner
shall calculate the sum of UC and BTHR and IN and divide this result by EX
minus Dep minus Am divided by 365, as in the following formula:
UC + BTHR + IN
(Ex-Dep-Am)/365
Source. #10944, eff 10-8-15
PART Ins 1806 PROCEDURES FOR
OBTAINING AND EXTENDING LIENS
Ins 1806.01 Procedures for
Obtaining and Extending Liens.
(a) The commissioner shall file a lien on all
real and personal property of a CCRC whenever the commissioner has evidence showing that the CCRC has
breached its contracts with residents or is engaged in activity which is
harmful to residents' physical or mental well-being. Any such lien shall be filed and administered
in accordance with all applicable laws respecting such liens.
(b) When the commissioner forecloses a lien, the
commissioner shall prepare a plan to distribute any proceeds from the foreclosure in a manner that will
best permit the satisfaction of any resident contracts in effect at that
time. The commissioner shall give a
written copy of this plan to each contractholder affected by the foreclosure,
and shall allow contractholders to comment on the plan before the commissioner
distributes any proceeds. The
commissioner shall allow affected contractholders to submit comments for a
period of at least 15 days after the date on which the commissioner mailed
copies of the plan.
(c) With respect to the lien property, liens
established by the commissioner shall not have priority over mortgages, security agreements, lease agreements,
or installment sales agreements on property not otherwise encumbered which a
CCRC has entered into with an issuer of bonds or notes and bonds which are
secured by resolution, ordinance, or indenture of trust if such mortgages or
agreements were duly recorded at least 4 months prior to the institution of
rehabilitation or liquidation proceedings.
Source. #7014, eff 7-1-99; EXPIRED: 7-1-07
New. #8991, eff 10-1-07; ss by #10944, eff 10-8-15
PART Ins 1807 ENTRANCE FEE ESCROW
ACCOUNTS
Ins 1807.01 Entrance Fee Escrow Accounts.
(a) Escrow accounts established to hold entrance
fees pursuant to RSA 420-D:10, I or accounts required by the commissioner to
hold liquid reserves, shall comply with each of the following:
(1) Escrow account funds shall be kept and
maintained in an account separate and apart from the business account of the
CCRC;
(2) All escrow account funds derived from entrance
fees shall remain the property of the resident, prospective resident, or other
person making payment on behalf of a resident or prospective resident and shall
not be subject to any liens or charges by the escrow agent, or judgments,
garnishments, or creditor's claims against the CCRC, until the funds have been
released to the CCRC as provided in RSA 420-D:10, III;
(3) Interest in an escrow account may be released
to a CCRC when any portion of the corresponding entrance fee is released to the
CCRC or when the resident makes his or her first monthly payment, whichever
occurs first;
(4) All records pertaining to the escrow account
shall be available for inspection or audit by the commissioner at any time;
(5) Any CCRC that establishes an escrow account
with an escrow agent shall enter into a written agreement with the escrow agent
which:
a. States that its purpose is to protect the
resident or prospective resident;
b. Authorizes the commissioner to inspect the
records of the escrow agent relating to the escrow account; and
c. Provides that, upon order of the commissioner
or a court of competent jurisdiction, the escrow agent shall release and pay
over the funds, or a portion thereof, to the CCRC, resident, prospective
resident, or other person entitled thereto as ordered; and
(6) A copy of each escrow agreement entered into
by the CCRC shall be filed with the commissioner for approval.
(b) When the escrow agent releases funds to a
CCRC, the agent shall adhere to the requirements of RSA 420-D:10, III.
(c) In lieu of maintaining entrance fee payments
in escrow accounts, a CCRC may, upon the commissioner's approval, post bond,
negotiable securities, or a letter of credit, with the commissioner.
(d) Approval of the commissioner shall be subject
to the following conditions:
(1) The
institution providing the bond or the letter of credit shall be acceptable to
the commissioner. In the case of a letter of credit, the institution issuing
the letter of credit shall be a qualified United States financial institution
as defined in RSA 406-C:2, IV. In the
case of a bond, the surety institution issuing the bond shall be acceptable if
it is a surety company authorized to transact business in
(2) The amount of the bond, negotiable
securities, or line of credit specified in the letter of credit shall be set by
the commissioner as provided in (5) below;
(3) Negotiable securities posted in lieu of escrow
shall, for the purpose of determining if they satisfy the amount set by the
commissioner, be valued at 75 percent of their market value. After posting the
initial negotiable securities, the CCRC shall be responsible for monitoring the
market value of the negotiable securities on deposit;
(4) Should the negotiable securities on deposit
at any time be valued at less than 133.3333 percent of the amount required, the
CCRC shall post additional negotiable securities as required so that the
negotiable securities posted shall at all times be equal to 133.3333 percent of
the amount required. Negotiable
securities posted shall be securities that are tradable on the New York Stock
Exchange, the American Stock Exchange or other comparable securities exchange;
(5) In setting the initial amount required for
the bond, negotiable securities, or the line of credit specified in the letter
of credit, whichever is to be posted, the commissioner shall take into
consideration the amount of the entrance fees, interest accrued thereon, and
other fees to be charged in addition to the number of life interest or
long-term leases to be offered, granted or sold. The commissioner shall revise the amount
required to be held in escrow using the same procedure used to set the initial
amount required upon review of the CCRCs most recent financial statements;
(6) The CCRC requesting that the commissioner
approve posting of a bond, negotiable securities, or letter of credit in lieu
of maintaining escrow accounts shall demonstrate to the commissioner that it
meets a high standard of financial worthiness;
(7) To demonstrate that it meets the required
standard, the CCRC shall provide the commissioner with data showing either:
a. That its standard financial statement ratios
are better than the industry-wide continuing care facility average by 25
percent or more; or
b. That its liquid assets as shown on the most
recent balance sheet, but not including the liquid reserve as determined under
Ins1805, are equal to 300 percent of the amount set by the commissioner for the
bond, negotiable securities, or letter of credit to be posted;
(8) The commissioner shall be a party to any bond
posted;
(9) No bond posted shall be cancelled except with
90 days prior notice to the commissioner; and
(10) CCRCs posting
negotiable securities with the commissioner shall file a “Domestic Company
Custodial Agreement,” NHID-CA1, dated 1990.
(e) A CCRC posting negotiable securities shall
deposit said securities in a custodial account to be held by the custodian in
trust for the benefit and security of policyholders, claimants or creditors of
the CCRC.
(f) A custodial agreement shall:
(1) Be signed by the facility and the custodian;
(2) State the amount maintained on deposit with
the custodian;
(3) Hold securities placed in the custodian
account exclusively for the commissioner as trustee in trust for the benefit of
(4) Provide that non-registered securities may be
held as follows:
a. Coupon/bearer form;
b. At book entry in a federal reserve bank; or
c. At the depository trust company as either a
direct bank or indirect depository participant;
(5) Provide that the custodian is liable to the
facility and the commissioner for the custodian's negligence, willful
misconduct or lack of good faith;
(6) Provide that no securities in the account nor
any principal is released except upon written request of the facility and
written assent to or in the name of the commissioner;
(7) Provide that the facility may withdraw
securities from the account, with the approval of the commissioner;
(8) Provide that the commissioner will approve
withdrawals under the circumstances in (7) above so long as other securities
are deposited with the custodian with market value equal to those withdrawn;
(9) Provide that the custodian may surrender any
security held under the agreement for payment upon maturity or redemption so
long as the proceeds thereof are held in a principal cash account maintained as
part of the custodial account in accordance with the custodial agreement;
(10) Provide that all transactions and withdrawals
involving deposited securities or principal cash be consummated only upon prior
receipt of instructions from the company and written assent of the trustee;
(11) Provide that the custodian send advice to the
commissioner of security and cash transactions within 10 days after a
transaction; and
(12) Provide that the custodian send to the
commissioner a certificate of account assets by February 1 for the preceding
calendar year through December 31.
Source. #7014, eff 7-1-99; EXPIRED: 7-1-07
New. #8991, eff 10-1-07; ss by #10944, eff 10-8-15;
amd by #12912, eff 10-28-19
PART Ins 1808 STANDARDS FOR
RESIDENT CONTRACT AND DISCLOSURE STATEMENTS
Ins
1808.01
Requirements for Documents.
(a) Documents given to residents and prospective
residents, including contracts with residents and disclosure statements, shall:
(1) Use language that a person of average
intelligence and education can read and understand;
(2) Present information in a logical sequence and
in a clear and direct fashion;
(3) Avoid complex and compound sentences;
(4) Use words in a manner which shall convey
their commonly understood meanings;
(5) Include definitions for words or terms which
cannot properly be explained or qualified in the text;
(6) Capitalize a defined word in any contract or
disclosure statement;
(7) Use frequent section headings to permit ease
in locating provisions;
(8) Be printed in easily legible typeface; and
(9) Contain an index, which shall be either the
first page of the document or whose location shall be noted on the first page
of the document, which lists all section headings used in the document if the
document is more than one page in length.
(b) If pre-existing conditions are excluded from
the medical care and services available from the CCRC, but are available at an
additional charge or are limited as to coverage, the term pre-existing
condition shall not limit coverage beyond that stated in the following:
"A
pre-existing condition is a disease, illness, sickness or physical condition
for which medical care, advice or treatment was recommended by or received from
a physician within the 2 year period preceding the date the CCRC committed
itself to accept the individual as a resident."
Source. #7014, eff 7-1-99; EXPIRED: 7-1-07
New. #8991, eff 10-1-07; ss by #10944, eff 10-8-15
Ins 1808.02 Resident Contract
Standards.
(a) All contracts between a CCRC and a resident
shall be executed on a form which has been previously approved by the
commissioner. To obtain approval for the
contract form, the CCRC shall provide the commissioner, via email, with a copy
of the proposed contract form in PDF format and a cover letter. The cover
letter shall provide a brief description of the main features of the contract
form. Upon review of the proposed
contract form, the commissioner shall notify the CCRC of approval or disapproval
of the form. When the contract forms are submitted, the CCRC shall also submit
to the commissioner the fee required by Ins 1809. After the fee has been received, the
commissioner shall approve the proposed contract form if he finds that it complies
with all requirements of RSA 420-D and Ins 1808.01.
(b) Each contract with resident shall have
attached a separate page notifying prospective residents of their right to
rescind the contract, as follows:
(1) The notice shall indicate the date the
rescission period begins;
(2) The notice shall include a statement to the
effect that the prospective resident may rescind and terminate his or her
contract or agreement, without penalty or forfeiture, within 10 days of the
date the rescission period begins, as specified in (1) above;
(3) The notice shall include a statement that the
prospective resident is not required to move into the CCRC before the
expiration of the 10 day rescission period and that no other agreement or
statement signed by the prospective resident shall constitute a waiver of the
right to rescind the contract or agreement within the 10 day rescission period;
(4) The notice shall include instructions
advising the prospective resident who wishes to rescind his contract or
agreement that:
a. The prospective resident may by mailing or
delivering a signed and dated copy of the notice, or any other dated written
notice, email, letter or facsimile, stating the prospective resident’s desire
to rescind the contract or agreement to the CCRC; and
b. Such notice to the CCRC must be sent
electronically or mailed to the business address of the CCRC not later than
midnight of the date of the last day for rescission, as specified on the notice
by the CCRC; and
(5) The notice shall include a form that the
prospective resident can use to notify the CCRC that the prospective resident
is canceling the contract or agreement, as permitted by the notice of the right
to rescind. This form shall include a line where the prospective resident may
place his signature and write in the date of signature.
(c)
Each contract shall set forth the terms and conditions governing the
return of the resident’s entrance fee.
The contract shall control when the entrance fee shall be returned to
the resident, except as provided in (d).
(d)
For contracts entered into after the 2015 effective date of this rule,
if hardship exists, the entrance fee, if any, based on the terms of the
contract, shall be returned as follows:
(1) No later than 12 months from the date of the
termination if the CCRC is at 80% or greater occupancy; or
(2) No later than 24 months from the date of the
termination if the CCRC is at less than 80% occupancy.
(e) For purposes of this section “hardship”
means:
(1) A change in circumstances that has
necessitated the termination of the contract between the resident and the CCRC;
and
(2) The resident, as a result of a change in circumstances,
cannot obtain acceptable living accommodations or health care services from the
CCRC; and
(3) The resident cannot otherwise pay for such
necessary room, board or health care services outside the CCRC without a return
of the entrance fee under the terms of the contract.
(f)
For the purposes of paragraph (e), “acceptable living accommodations”
means living arrangements that:
(1) Are within the financial means of the
resident;
(2) Provide for needed health care services,
including mental health services; and
(3) Respect and reflect the right of the resident
to self-determination, dignity, religious affiliations, freedom of association,
and other personal interests as those interests are described in patient and senior citizens’ bill of rights
laws such as RSA 151:21 and RSA 161-M:3.
(g)
Contracts subject to paragraph (d) shall state that in the event of a
dispute as to the existence of hardship, the CCRC shall provide the resident
with a written notice stating the grounds for its denial, and shall include the
following statement: “We will of course,
be available to you to discuss the position we have taken. Should you, however, wish to take this matter
up with the New Hampshire Insurance Department, it maintains a consumer service
division to investigate resident complaints at
(h) If the CCRC contract does not provide for
assisted living, skilled nursing care or nursing home care, the contract shall
state this prominently, on the first page of the contract and in at least
14-point bold capital letters. This statement shall be preceded by the
following caption:
“THIS CONTRACT DOES NOT PROVIDE YOU WITH ANY RIGHT TO
RECEIVE THE FOLLOWING CARE”
(i) The CCRC shall submit to the commissioner for
approval any revision or amendment to an approved contract form. This
submission shall include a copy of
the revised contract or amendment form in PDF format and a cover letter. The
cover letter shall list and describe each amendment or revision to the
previously approved contract form. Upon
review of the amendment or revision to the contract form, the commissioner
shall notify the CCRC of approval or disapproval of the form. The commissioner shall approve the amendment
or revision to the contract form if he finds that they comply with all requirements
of RSA 420-D and this part.
(j) When submitting either a proposed contract
form, amendments or revisions to a contract form to the commissioner for
approval, the CCRC shall, in a supplement to the cover letter, list every
instance where the contract form will use variable language. In this supplement, the CCRC shall describe
the complete range of variable language that will appear in the contract form
for each instance listed.
(k) All contracts with residents shall be printed
in 12 point type or larger and shall be prepared in a manner to ensure
legibility and ease of reading.
(l) A valid and binding contract with a resident
shall be signed by the CCRC and each resident who is admitted to the CCRC. An
authorized representative may sign the contract with a resident on behalf of either
party.
(m) If the resident has agreed to purchase, at an
additional price, optional products or services beyond those included in the
entrance and periodic fees, a separate page shall be attached specifying the
product or service purchased, and the cost of each including any installation
charge. Each such separate page shall be
executed by the parties identified in paragraph (l).
(n) The contract with resident shall be
distributed as follows:
(1) A copy of the current contract with resident
form shall be attached as an appendix to each disclosure statement or amended
disclosure statement filed with the commissioner;
(2) A copy of the current contract with resident
form shall be attached to each disclosure statement given to a prospective
resident, unless the individual previously received a disclosure statement with
a current contract with resident form attached thereto;
(3) A copy of the current contract with resident
form may be given to current residents; and
(4) If a contract with resident form is not
attached to the disclosure statement, as authorized under paragraph (2) above,
a separate page shall be attached stating that a copy of the contract with
resident form was omitted.
(o) Each CCRC shall maintain copies of each
contract with resident form it has executed with a resident until the
conclusion of the next succeeding audit by the insurance department following
the date the contract ceases to be in force.
Source. #7014, eff 7-1-99; EXPIRED: 7-1-07
New. #8991, eff 10-1-07; ss by #10944, eff 10-8-15
Ins 1808.03 Disclosure
Statements.
(a) A CCRC shall submit all disclosure statements
to the commissioner for prior approval. No CCRC shall distribute a disclosure
statement in any manner to prospective residents, residents or residents'
authorized representatives, until the commissioner has approved the format of
the disclosure statement.
(b) To obtain approval for the disclosure
statement, the CCRC shall submit to the commissioner:
(1) A copy of the proposed disclosure statement;
(2) A cover letter, which shall briefly describe
the main features of the disclosure statement; and
(3) The examination fee required by Ins 1809.
(c) The commissioner shall approve the proposed
disclosure statement if the commissioner finds that it complies with all
requirements of RSA 420-D and this part.
(d) The commissioner shall notify the CCRC when
the commissioner has approved or disapproved the disclosure form.
(e) The CCRC shall submit to the commissioner for
his approval any revision or amendment to an approved disclosure
statement. This submission shall include
a copy of the revised disclosure statement or amendment thereto, a cover letter
and the fee required by Ins 1809. The
cover letter shall list and describe each amendment or revision made to the previously
approved disclosure statement. Upon
review of the amendment or revision to the disclosure statement, the
commissioner shall notify the CCRC of his approval or disapproval. The commissioner shall approve the amendment
or revision to the disclosure statement if the commissioner finds that it
complies with all requirements of RSA 420-D and this part.
(f) In addition to the requirements of RSA
420-D:4 and Ins 1808.01, the disclosure statement shall comply with the
following rules:
(1) The disclosure statement shall include a
statement advising the prospective resident that New Hampshire law requires the
CCRC to provide the prospective resident with a disclosure statement before the
initial transfer of funds and before the prospective resident consents to any
contract with the CCRC; and
(2) The notice required by RSA 420-D:4, I shall
appear on the cover page of the disclosure statement in a prominent location
and typeface.
(g) Changes in the operation of a CCRC which
require an amendment to the disclosure statement shall include the following:
(1) Changes in the board of directors, officers,
managing or general partners, administrators or trustees, and managers which
affect the management of the CCRC. The CCRC shall file biographical affidavits
by these individuals with the commissioner at the time the CCRC submits an
amended disclosure statement;
(2) Any new or additional mortgages, liens,
security interests, loan commitments, long-term financing arrangements or
leases, which materially affects the real property of the CCRC. The CCRC shall
file a copy of all pertinent documents evidencing the transactions with the
commissioner at the time the CCRC submits an amended disclosure statement; and
(3) Other material changes in the financial or
factual information contained in the disclosure statement or any statement in
support of the CCRCs original application for a certificate of authority. The
CCRC shall file explanatory material and copies of pertinent documents
concerning the material changes with the commissioner at the time the CCRC
submits an amended disclosure statement.
(h) All disclosure statements shall be printed in
12 point type or larger.
Source. #7014, eff 7-1-99; EXPIRED: 7-1-07
New. #8991, eff 10-1-07; ss by #10944, eff 10-8-15
PART Ins 1809 FEES
Ins 1809.01 Fees.
(a) Upon each application for a permanent
certificate of authority, the applicant shall pay a fee of $800.00 to
the state of
(b) Upon each filing of the annual report as
required pursuant to Ins 1804, the CCRC shall pay a fee of $800 to the state of
(c) A CCRC shall pay a fee of $80.00 to the state
of
(d) Upon each application for a new certificate
of authority required pursuant to RSA 420-D:13, II, when management control of more
than 50% of the assets of a facility are transferred to another party, the
applicant shall pay a fee of $400.00 to the state of New Hampshire.
(e) When the commissioner audits or investigates
a CCRC pursuant to RSA 420-D:23 or RSA 420-D:21, the CCRC shall bear the
expense of the audit or investigation as follows:
(1) The commissioner shall present quarterly
bills for the expenses charged to all CCRCs who have been audited or who are
scheduled for audits in the current fiscal year of the insurance department.
The first 3 quarterly bills shall be estimated bills. The final quarterly bill
shall be for actual charges made that fiscal year;
(2) The CCRC shall be liable for the expenses
associated with an audit or investigation in accordance with RSA 400-A:37. However, the per diem allowance to compensate
state employees under RSA 400-A:37, VII, exclusive of expenses, shall not
exceed $1,000; and
(3) All such expenses of an audit or investigation
charged and billed shall be payable to the state of
Source. #7014, eff 7-1-99; EXPIRED: 7-1-07
New. #8991, eff 10-1-07; ss by #10944, eff 10-8-15
PART Ins 1810 AUDITS
Ins 1810.01 Audits.
(a) The
commissioner shall audit the books and records of each licensed CCRC at least
once every 5 years.
(b) Upon completion of any audit conducted by the
commissioner, a written audit report shall be prepared.
(c) The
audit report shall be submitted to the CCRC audited. The CCRC may object to the
report within 30 days from the receipt thereof. Any such objection shall take
the form of a request for a hearing in compliance with the procedures described
under Ins 200.
(d) When the CCRC
has raised an objection to the audit report, the commissioner shall hold a
hearing in compliance with the hearing procedure established by Ins 200 and RSA
541-A:30-a through RSA 541-A:38.
(e) The audit report and all information obtained
or produced in the conduct of the audit shall be governed by the
confidentiality provisions of RSA 400-A:37.
Source. #7014, eff 7-1-99; EXPIRED: 7-1-07
New. #8991, eff 10-1-07; ss by #10944, eff 10-8-15
PART Ins 1811 TRANSFER OR
Ins 1811.01 Transfer or
(a) When a transfer or sale of interest is
proposed, the commissioner shall receive notice pursuant to RSA 420-D.
(b) Such notice shall include:
(1) A biographical affidavit, described in Ins
1803.01(c), for any proposed new officer, trustee, investor, owner with more
than 5% ownership, or new executive director, or equivalent title, who is not
an officer or trustee;
(2) The most recent balance sheet and income
statement of any party who is proposed to acquire an ownership interest of 5%
or more, if the transfer or sale of interest involves less than 50% but more
than 5% of the assets of the continuing care facility;
(3) A detailed account of any changes that will occur
in the debt structure of the continuing care facility or the continuing care
CCRC, and
(4) A detailed account of the resulting debt
service requirements, with notes explaining how these debt service requirements
differ from the requirements in existence prior to the proposed transfer or
sale.
(c) When RSA 420-D:13, II
requires a new CCRC to apply for a certificate of authority, the application
procedures of Ins 1803 shall apply.
Source. #7014, eff 7-1-99; EXPIRED: 7-1-07
New. #8991, eff 10-1-07; ss by #10944, eff 10-8-15
PART Ins 1812 ENFORCEMENT
Ins 1812.01 Violations. Any person or CCRC violating the
provisions of this chapter shall be subject to the provisions of RSA 400-A:15.
Source. #7014, eff 7-1-99; EXPIRED: 7-1-07
New. #8991, eff 10-1-07; ss by #10944, eff 10-8-15
PART Ins 1813 WAIVER
Ins 1813.01 Waiver of Rules.
(a)
The commissioner, upon the commissioner’s own initiative or upon request
by a provider, shall waive any requirement of this chapter if such waiver does
not contradict the objective or intent of the rule and:
(1) Applying the rule provision would cause
confusion or would be misleading to consumers;
(2) The rule provision is in whole or in part
inapplicable to the given circumstances;
(3) There are specific circumstances unique to
the situation such that strict compliance
with the rule
would be onerous without promoting the objective or intent of the rule provision;
or
(4) Any other similar extenuating circumstances
exist such that application of an alternative standard or procedure better
promotes the objective or intent of the rule provision.
(b)
No requirement prescribed by statute shall be waived unless expressly
authorized by law.
(c)
Any person or entity seeking a waiver shall make a request in writing.
(d)
A request for a waiver shall specify the basis for the waiver and
proposed alternative, if any.
Source. #12912, eff 10-28-19
APPENDIX A
Rule |
Specific State Statute which the Rule is Intended
to Implement |
Ins 1801.01 |
RSA 420-D:17 |
Ins 1801.02 |
RSA 420-D:17 |
Ins 1802.01 |
RSA 420-D:1;
420-D:17 |
Ins 1803.01 |
RSA 420-D:7; 420-D:2; 420-D:3 |
Ins 1803.02 |
RSA 420-D:2;
420-D:3; 420-D:5; 420-D:17, VI |
Ins 1804.01 |
RSA 420-D:4;
420-D:7 |
Ins 1805.01 |
RSA 420-D:8 |
Ins 1805.02 |
RSA 420-D:8 |
Ins 1806.01 |
RSA 420-D:9 |
Ins 1807.01 |
RSA 420-D:17,
XIII; 420-D:10 |
Ins 1807.01(a)
and (b) |
RSA 400-A:15,
I; RSA 420-D:10, III; RSA 420-D:17, XIII |
Ins 1808.01 |
RSA 420-D:17,
V, XIV; 420-D:4; 420-D:12 |
Ins 1808.02 |
RSA 420-D:17,
XIV; 420-D:4; 420-D:12 |
Ins 1808.03 |
RSA 420-D:17,
V; 420-D:4; 420-D:12 |
Ins 1809.01 |
RSA 420-D:17, III,
IV, XVI; 420-D:25 |
Ins 1810.01 |
RSA 400-A:37;
420-D:23; 420-D:25 |
Ins 1811.01 |
RSA 420-D:13 |
Ins 1812.01 |
RSA 400-A:15;
420-D:24; 420-D:25; 420-D:26 |
Ins 1813 |
RSA 400-A:15,
I; RSA 541-A:22, IV |
APPENDIX B Incorporation by Reference Information
Rule |
Title |
Publisher; How to Obtain; and Cost |
Ins 1804.01
(d)(3) |
“Actuarial
Standard of Practice No. 3, Practices Relating to Continuing Care Retirement
Communities” adopted July,
1994 |
American Academy
of Actuaries, 1100 Seventeenth Street, 7th Floor, Washington, DC
20036; tel. 202-223-8196; www.actuary.org |
Ins 1807.01
(d)(10) |
“Domestic
Company Custodial Agreement” |
NHID-CA1, dated
1990 N.H. Insurance
Department, |