Revision: March 7, 2025, 8:37 a.m.
Senate Health and Human Services
March 6, 2025
2025-0790s
05/08
Amendment to SB 124-FN
Amend section 1 of the bill by replacing subparagraph I(g) with the following:
(g) Recently, a continuing care resident community filed for chapter 11 bankruptcy in New Hampshire. Other continuing care resident communities have filed for bankruptcy across the country, and the proceedings illustrate the need for laws to be updated to provide more protection for the residents of continuing care resident communities in the event of an insolvency or bankruptcy. In the event of bankruptcy, residents could lose the right to occupy the facility and to receive a refund of any remaining entrance fee when due, leaving them without funds and without a home.
Amend RSA 420-D:2, I as inserted by section 2 of the bill by replacing it with the following:
I. No person or provider may solicit funds other than non-binding deposit fees of not more than $1,000, accept payments of any kind, or otherwise engage in providing any form of continuing care without acquiring and maintaining a certificate of authority issued by the commissioner pursuant to this chapter. An application for a certificate shall include the proposed disclosure statement and form contract 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 statutory requirements have been met. The commissioner shall take prompt action on requests for a certificate and shall, within a reasonable time, issue a certificate of authority or a written rejection. If the commissioner rejects an application, the commissioner 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 pursuant to RSA 541-A. Certificates issued under this section shall continue in effect until revoked by the commissioner or until sale or transfer of control to another provider.
Amend RSA 420-D:2, III(q) as inserted by section 2 of the bill by replacing it with the following:
(q) A statement that neither the provider nor any of its officers or principals have ever been convicted of a felony or charged with a misdemeanor involving embezzlement, theft, larceny, or mail fraud, or charged with any violation of any corporate securities laws in this state or a foreign jurisdiction, and that the provider has never been subject to any permanent injunction or final administrative order restraining a false or misleading promotional plan involving continuing care facility disposition or if so, copies of all pleadings and orders in regard thereto. If there is an action or conviction the commissioner shall determine whether to disqualify the relevant party.
Amend RSA 420-D:2, III(v) as inserted by section 2 of the bill by replacing it with the following:
(v) Certification that the applicant’s IT platform meets applicable health information security regulations and standards, including those pertaining to cybersecurity.
Amend RSA 420-D:4, I as inserted by section 2 of the bill by replacing it with the following:
I. A disclosure statement shall be approved by the department prior to delivery to any prospective resident. Each provider shall provide each prospective resident with a current disclosure statement and a current continuing care contract, which have previously been approved by the commissioner. A disclosure statement shall not be deemed current unless it contains all amendments filed and is approved by the department. When a provider files an amended disclosure statement, the provider shall redline the changes from the prior approved statement when submitting it to the department. The provider shall amend the disclosure statement if there is any change in management or ownership that requires the execution of a new affidavit supporting the disclosure statement or other material change. The provider shall have 30 days to submit an amended disclosure statement to the department for review if there is a material change. The disclosure statement shall include, in conspicuous large type, the statements below. The statements in the disclosure statement and contract shall be in plain and understandable English. The disclosure statement shall disclose fully and accurately state the characteristics of the CCRC, and the interests offered and shall make known to prospective residents all unusual and material circumstances and features affecting the CCRC and provider.
Amend the introductory paragraph of RSA 420-D:4, II as inserted by section 2 of the bill by replacing it with the following:
II. The disclosure statement shall be provided to the prospective resident at least 24 hours before consenting to any contract and before the initial transfer of funds, and shall include, at a minimum, the following information:
Amend RSA 420-D:4, II(c) as inserted by section 2 of the bill by replacing it with the following:
(c) The disclosure statement shall also include:
(1) If the provider is not the owner, the name and address of the owner; whether or not it is an affiliate; and the name and address of all affiliates.
(2) 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.
(3) Whether the provider claims to be nonprofit or tax exempt.
(4) 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.
(5) The services to be provided by the facility under basic contract and those at extra cost.
(6) All locations where services are to be provided, if different from the main facility.
(7) 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”
(8) 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.
(9) A description of the provider policy and procedures for receiving advance deposits, also known as “wait list deposits”, by prospective residents desiring future occupancy at the facility and how those deposits will be maintained prior to final signing of the continuing care contract, in bank accounts, investment accounts, or escrow accounts if required by this statute and including any interest payment provisions.
(10) A description of the provider policy and procedures for receiving and maintaining entrance fees prior to and during the continuing care contract signing process, in bank accounts, investment accounts, or escrow accounts if required by this statute and including any interest payment provisions.
(11) When and how periodic payments may be charged by the provider.
(12) Provisions of the provider for reserve funding, escrows, and trusts and investment of these funds.
(13) 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. This requirement may be waived by the commissioner in his or her sole discretion.
(14) A description of the company’s affiliates and structure, and if a non-profit, a discussion of the charitable purpose of the non-profit and the need in certain instances for money to be used for advancement of the charitable purpose.
(15) A description of the provider policy and procedures for receiving advance deposits or “wait list deposits” by prospective residents desiring future occupancy at the facility and how those deposits will be maintained prior to final signing of the continuing care contract, in bank accounts, investment accounts, or escrow accounts if required by this chapter and including any interest payment provisions.
(16) A description of the provider policy and procedures for receiving and maintaining entrance fees prior to and during the continuing care contract signing process, in bank accounts, investment accounts, or escrow accounts if required by this chapter and including any interest payment provisions.
Amend RSA 420-D:5, I(f) as inserted by section 2 of the bill by replacing it with the following:
(f) Failure to comply with a cease-and-desist order under RSA 420-D:21.
Amend RSA 420-D:7, I as inserted by section 2 of the bill by replacing it with the following:
I. Annually, 120 days after the end of each fiscal year, a provider shall submit a report to the commissioner relative to the financial condition of the provider together with any other information required by the commissioner. The commissioner may require more frequent reports of any provider, if the commissioner deems it necessary for proper review.
Amend RSA 420-D:7-a, II and III as inserted by section 2 of the bill by replacing it with the following:
II. In addition, the provider shall calculate and submit a liquid reserve calculation for each quarter and a detail of current occupancy by category of residency and representation that they are in compliance with all material loan covenants.
III. The quarterly statements shall be signed and attested to by the provider’s chief financial officer or if there is no chief financial officer, a company level officer.
Amend RSA 420-D:10, III(a)(1) as inserted by section 2 of the bill by replacing it with the following:
(1) If occupancy is greater than 80 percent for independent living, the days cash on hand is more than 100 days, and there is no violation of RSA 420-D or material loan covenants, there is no entrance fee escrow requirement.
Amend RSA 420-D:10, III(c)(1) as inserted by section 2 of the bill by replacing it with the following:
(c)(1) If a wait list deposit exceeds 10 percent of the entrance fee per resident unit, any amounts more than 10 percent of the entrance fee shall be escrowed. Amounts below or equal to 10 percent of the entrance fee need not be escrowed, as long as the provider has at least 80 percent occupancy for independent living occupancy and 100 days cash on hand, and is otherwise in compliance with RSA 420-D and its material loan covenants. All wait list deposits shall be refundable. A maintenance fee may be charged of up to $1,500, as may be adjusted from time to time by the commissioner. The wait list agreement shall be provided to the department annually and the resident shall be given an estimate of when the resident will be reached on the wait list at the time the resident executes the wait list agreement. A resident shall also be told that their payment will not be escrowed if the payment is being placed in a non-escrow account. Deposits existing as of the effective date of this chapter are exempt. However, the provider shall contact all prospective residents on any wait list within one year of the effective date of this chapter to determine whether they are due any refund of existing deposits, and thereafter every 3 years.
Amend RSA 420-D:10-a, I as inserted by section 2 of the bill by replacing it with the following:
I.(a) A contract may only be terminated by the provider for the following reasons:
(1) It is necessary for the resident’s welfare;
(2) The resident’s health has improved sufficiently so that they no longer need the services provided;
(3) The health or safety of the resident or other residents is endangered by the resident’s continued presence in the CCRC; or
(4) Nonpayment of periodic payments or other required fees or other violation of the contract.
(b) If a provider seeks to terminate a contract, it must provide the resident with 60 days’ notice. If a contract is terminated outside the cancellation period either by the provider for just cause or after 90 days written notice by the resident, then any refund that may be due shall be paid no later than 45 days after a new resident signs a written contract for the unit and the 15-day cancellation period passes without cancellation. The landlord-tenant laws shall apply to any eviction for purposes of removal of a hold over resident in a non-licensed unit, and for no other purpose. For hold over residents residing in units licensed under RSA 151, the transfer or discharge provisions under RSA 151:21,V and RSA 151:26 shall apply.
Amend RSA 420-D:12, I(b) as inserted by section 2 of the bill by replacing it with the following:
(b) Cover only one resident, or 2 if jointly liable and shall include the total amount paid by the resident, or on behalf of the resident, to the provider as an entrance fee. If securities or real or personal property are transferred to the provider instead of cash, the provider shall describe 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.
Amend RSA 420-D:12, I by inserting after subparagraph (p) the following new subparagraph:
(q) Explain whether the CCRC provides assisted living, skilled nursing care, or nursing home care or accepts Medicaid or Medicare as a source of payment for these services.
Amend RSA 420-D:13, I as inserted by section 2 of the bill by replacing it with the following:
I. A provider shall notify the commissioner prior to the proposed sale or transfer to a third party of a material portion of the provider’s assets or beneficial interests, or of a proposed transfer of control of the provider. For purposes of this section, “material portion of the provider’s assets and or interests” means any assets of the provider worth greater in the aggregate more than 10 percent of any interests of the provider’s total assets or 50 percent or more of the beneficial interests. The notification shall specify the amount of assets or interests involved in the transfer, the type of transfer, and to whom. The proposed transfer shall be approved by the commissioner before such transfer can be made and become effective. The commissioner may refuse to approve such transfers until full disclosure has been made, to his or her satisfaction, of the terms and conditions of the transfer and the commissioner has determined that such transfer (i) will be to a qualified provider to whom a certificate of authority will be issued under the statute; (ii) will not negatively impact the financial stability of the CCRC; and (iii) will not diminish services or protections given to current and future residents, whose interests are paramount. Notwithstanding the above, if a provider is in violation of RSA 420-D or its material loan covenants, the provider shall notify the department of any transfer of assets or interests out of the ordinary course of business in any amount and the department shall, at its option, approve or deny the sale or transfer. If the transfer involves a transfer of ownership of more than 5 percent of the outstanding ownership interests, a new biographical affidavit shall be provided to the department.
Amend RSA 420-D:16-b, I(c) as inserted by section 2 of the bill by replacing it with the following:
(c) Any remaining amount due the resident shall be payable within 45 days from the date of the end of the cancellation period or the date the entrance fee from the new resident is received by the provider, whichever is later.
Amend RSA 420-D:16-b, II as inserted by section 2 of the bill by replacing it with the following:
II. When an entrance fee deposit is refundable, it shall be paid to either the resident, the resident's named beneficiary, or the legal representative of the resident's estate, whichever is applicable, except for beneficiary assignments made irrevocable by the resident. A resident shall have the right to change, in writing, the named beneficiary for the entrance fee refund at any time.
Amend RSA 420-D:18 as inserted by section 2 of the bill by replacing it with the following:
420-D:18 Dividends and Transfers. A provider shall obtain prior approval from the commissioner before declaring and distributing any dividends, if a for-profit entity, or, except as noted below, transferring any cash, dividends, or any other funds or assets of the provider to an affiliate of any entity. Notwithstanding this paragraph, if the provider has more than 80 percent occupancy of its independent living units, more than 100 days cash on hand, and the provider is otherwise in compliance with RSA 420-D and its material loan covenants, the provider shall not need commissioner approval for a transfer if the transfer is less than 10 percent of the provider’s total assets for any consecutive 12-month period. A transfer of assets shall include a management or management-type fee that is not associated with providing goods and services by the affiliate. All management contracts between the provider and an affiliate shall be disclosed to the commissioner, and the commissioner shall have 30 days to object.
Amend RSA 420-D:20, I(b) as inserted by section 2 of the bill by replacing it with the following:
(b) What will happen to each resident. The provider shall either provide for the refund of any remaining entrance fee to the resident through immediately available funds or shall provide an alternative facility for the resident to occupy, with a transfer of remaining funds to the new provider. The residents shall have the choice to move to the alternate facility, to have the remaining portion of their entrance fee refunded through immediately available funds, or to enter into a mutually agreeable alternative resolution with the provider. If the provider is incapable of satisfying this subparagraph, they must explain why in any plan.