New York Codes, Rules and Regulations
Title 11 - INSURANCE
Chapter XIII - Life Care Communities
Part 350 - Continuing Care Retirement Communities
Section 350.1 - Definitions

Universal Citation: 11 NY Comp Codes Rules and Regs ยง 350.1

Current through Register Vol. 46, No. 12, March 20, 2024

For purposes of this Part, unless the context indicates otherwise, the following definitions shall apply:

(a) Affiliate shall have the meaning ascribed by Insurance Law section 107(a)(4).

(b) Capital assets means those assets related to the continuing care retirement community as follows:

(1) class 1-land;

(2) class 2-building;

(3) class 3-equipment, furnishings, refurbishments; and

(4) class 4-original startup costs actually incurred, which may include, if applicable, architect fees, legal fees, original marketing costs, development fees, sewer construction and financing costs involved with development, if not included above.

(c) Capital expenses means those expenses related to capital assets (both original and replacements) associated with the continuing care retirement community. Capital expenses in any year shall consist of:

(1) any expenses for insurance and taxes related to these capital items;

(2) the excess, if any, of the cost to acquire a capital asset over the value of the capital asset for the year of acquisition;

(3) the excess, if any, of the cost to repair or replace a capital asset over the increase in value of the capital asset for the year of repair or replacement; and

(4) the actual depreciation or amortization charged for capital assets for such year.

(d) Certificate of authority shall have the meaning ascribed by Public Health Law section 4601(1).

(e) Commencement of operations for a continuing care retirement community shall be after the first living unit has been occupied.

(f) Continuing care retirement community or community shall have the meaning ascribed by Public Health Law section 4601(2-b).

(g) Continuing care retirement contract or continuing care at home contract shall have the meaning ascribed by Public Health Law section 4601(2-a)

(h) Control, controlling, controlled by, and under common control with means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting securities or voting rights, by contract (except a commercial contract for goods or non-management services) or otherwise; but no person shall be deemed to control another person solely by reason of his or her being an officer or director of such other person.

(i) Derivative instrument shall have the meaning ascribed by Insurance Law section 1401(a)(7).

(j) Earned surplus means the surplus less the paid in surplus.

(k) Fiscal year means the January 1st through December 31st period. The superintendent may approve a different reporting year for a continuing care retirement community provided that the audited financial statement and the actuarial study are prepared in a manner consistent with the alternate fiscal year.

(l) Foreign domicile means any domicile outside of the United States.

(m) The invested assets of a continuing care retirement community means assets meeting the requirements of section 350.6(a)(3) or (c) of this Part.

(n) Institution shall have the meaning ascribed by Insurance Law section 107(a)(24).

(o) Market value means the price that would be received to sell an asset or the price that would be paid to transfer a liability in an orderly transaction between market participants at the measurement date. The following shall be used in determining market value:

(1) for an obligation, market value shall be based on unadjusted quoted prices on a recognized national exchange in the United States, or if no quoted prices from a recognized national exchange in the United States are available, a value that reflects the price needed to yield the same as the average current yields on new investments of similar quality and maturity;

(2) for a common stock or a preferred stock, market value shall be based on unadjusted quoted prices on a recognized national stock exchange in the United States;

(3) for shares in an open-end investment company, market value shall be based on the net asset value; and

(4) for shares in an investment company that is an exchange traded fund, market value shall be based on unadjusted quoted prices on a recognized national stock exchange in the United States.

(p) NRSRO means a nationally recognized statistical rating organization that has been recognized by the superintendent.

(q) Net surplus means the surplus less the part 2 paid in surplus.

(r) Non resident means a person living in a continuing care retirement community who has not entered into a continuing care retirement contract or a continuing care at home contract with that community.

(s) Obligations shall have the meaning ascribed in Insurance Law section 107(a)(33).

(t) Operating expenses means those expenses, other than capital expenses and refund expenses, associated with the services to be provided pursuant to the continuing care retirement contracts and continuing care at home contracts, such as expenses for administration, food service, housekeeping, maintenance, utilities, nursing care, health services, resident services, leases, taxes, and insurance.

(u) Operator means a legal entity operating a continuing care retirement community pursuant to a certificate of authority pursuant to Public Health Law article 46.

(v) Paid in surplus means any stock or funds contributed to the continuing care retirement community by the operator, increased by credits allowed, including any credits appropriate from the date of contribution, and decreased by any distributions of paid in surplus to the operator, which shall be allocated as follows:

(1) part 1 paid in surplus corresponding to assets that at the time of contribution were eligible to support reserve liabilities under section 350.6 of this Part;

(2) part 2 paid in surplus corresponding to assets that at the time of contribution were not eligible to support reserve liabilities under section 350.6 of this Part.

(w) Parent corporation shall have the meaning ascribed by Insurance Law section 107(a)(40).

(x) Person means an individual or other entity, or any combination of the foregoing acting in concert.

(y) Qualified consulting actuary means an individual who:

(1) is a member of the American Academy of Actuaries and has, based on the academy's qualification standards, the necessary training and experience pertaining to continuing care retirement communities; or

(2) demonstrates to the satisfaction of the superintendent that based on the individual's knowledge, training and experience that the individual has the necessary knowledge pertaining to continuing care retirement communities.

(z) Rating methodology means the methodology and detailed formulas developed pursuant to Public Health Law section 4604(4)(a)(ii).

(aa) Refund expenses means the amount returned to a resident from either entrance fees or monthly fees upon termination of the continuing care retirement contract or continuing care at home contract because of the death of the resident or withdrawal or dismissal of the resident from the continuing care retirement community, or modification of the continuing care retirement contract or continuing care at home contract.

(ab) Resident shall have the meaning ascribed by Public Health Law section 4601(15).

(ac) Satisfactory actuarial balance means that the most recent actuarial study of the community that is satisfactory to the superintendent indicates all of the following conditions are met:

(1) the net surplus as of the current valuation (reporting) date is greater than or equal to zero as demonstrated by the actuarial balance sheet in the actuarial study;

(2) the current fee schedule for each continuing care retirement contract type and continuing care at home contract type offered to new residents to the community contains positive margins as demonstrated by the new resident cohort pricing analysis included in the actuarial study. Any reliance on revenues or contributions from an endowment, foundation, parent corporation, affiliate, subsidiary or other external source that is used to satisfy this condition shall require justification satisfactory to the superintendent. Any reliance on surplus that is used to satisfy this condition shall require justification satisfactory to the superintendent; and

(3) the invested assets of the community are greater than zero for each of the next 10 projection years as demonstrated by the cash flow projection in the actuarial study.

(ad) Subsidiary shall have the meaning ascribed by Insurance Law section 107(a)(40).

(ae) Surplus means the total assets less the total reserve liabilities of the continuing care retirement community as shown on the actuarial balance sheet included in the actuarial study.

(af) United States shall have the meaning ascribed by Insurance Law section 1401(a)(4).

Disclaimer: These regulations may not be the most recent version. New York may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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