Pennsylvania Code
Title 31 - INSURANCE
Part VIII - Miscellaneous Provisions
Chapter 151 - CONTINUING CARE PROVIDERS
Section 151.4 - Statement in support of application
Universal Citation: 31 PA Code ยง 151.4
Current through Register Vol. 54, No. 12, March 23, 2024
(a) Each applicant shall file a statement in support of an application for a certificate of authority, which shall contain the following information and appendices:
(1)
Occupancy status. A description of whether the facility is
ready for occupancy. If the facility is already occupied and in operation,
indicate the date the facility commenced business. If the facility is under
construction, indicate the estimated construction completion date.
(2)
Financing of facility. A
statement detailing existing or proposed mortgages, liens, security interests
or loan commitments on the real property of the facility. Provide the name and
address of mortgagees or other lenders and a copy of mortgages, liens, security
interests or loan commitment documents. If other long term financing
arrangements have been arranged or are contemplated, such as tax-free
debentures, a complete description of the arrangement shall be provided and all
pertinent contracts and documents shall be attached. If the facility is subject
to a lease agreement, provide the name and address of interested parties and a
copy of a lease.
(3)
Fiscal
year. A specification of the applicant's fiscal year.
(4)
Tax exempt status. If
the applicant claims tax exempt status under the Internal Revenue Code of 1954
(26 U.S.C.A. §§
1-9602) provide a ruling or other
document evidencing qualification for tax exempt status. If the applicant
claims it is not subject to the capital stock tax or corporate net income tax
imposed by the Tax Reform Code of 1971 (72 P. S. §§
7101-10004) provide the appropriate
documentation demonstrating qualification for the exemption.
(5)
Feasibility study. If
operation of a facility has not yet commenced, provide a feasibility study
prepared to secure financing for the proposed facility. If a feasibility study
was not required to obtain financing, a study is not required to be produced
under this subsection. The study should include:
(i) A description of the proposed facility
including location, size, anticipated completion date and proposed construction
program.
(ii) An identification and
evaluation of the potential market, including a demographic and economic
profile of the population in the facility's market area.
(iii) An identification of other existing or
proposed facilities in the potential market area, including, if available, the
occupancy rate for existing facilities for the last 3 years.
(iv) An estimate of net receipts from
entrance fees, other than those included in the statement of source and
application of funds, less estimated entrance fee refunds and a description of
the actuarial bases and methods of calculation for the projection of entrance
fee receipts.
(v) The name and
address of the person who prepared the feasibility study and the experience of
the person in preparing similar studies or otherwise consulting in the field of
continuing care or related health care fields.
(6)
Financial analysis. A
financial analysis prepared for the purpose of determining that the facility
has-or if the facility is proposed, will have-sufficient revenue and funds,
including reserves. The analysis shall include a cash flow projection, a review
of the adequacy of current pricing structures, and an examination of the
long-term relationship between the facility's assets and liabilities. The
analysis shall be prepared by either a qualified actuary or a certified public
accountant.
(7)
Affiliates.
An organizational chart describing the relationship between the
applicant and its affiliates, indicating the state of domicile of the entity
and the primary business of each.
(8)
Previous licenses. A
statement indicating whether the applicant has ever applied for a certificate
of authority for a facility in this Commonwealth or sought licensure in another
jurisdiction. Indicate the status of the application-issued, refused, or
pending. If a previous license was issued, provide the name and address of the
facility licensed, the name of the issuing authority, the date of issuance, and
the date of and reason for termination.
(9)
Organizational filings.
The documents described in this paragraph pertaining to the applicant shall be
attached to the statement:
(i) If the
applicant is a corporation, a copy of the charter shall be attached.
(ii) If the applicant is a partnership or
other unincorporated association, a copy of the partnership agreement, articles
of association or other membership agreement shall be attached.
(iii) If the applicant is a trust, a copy of
the trust agreement or instrument shall be attached.
(iv) If the applicant uses a trade name which
is required to be registered under
54 Pa.C.S. §§
301-332 (relating to Fictitious Names Act), a
copy of the fictitious name registration shall be attached.
(10)
Entrance fees. The
relevant documents described in this paragraph shall be attached to the
statement.
(i) If the applicant proposes to
use an entrance fee escrow account, provide the name and address of the escrow
agent and a copy of the escrow agreement.
(ii) If the applicant proposes to provide a
letter of credit in lieu of using an entrance fee escrow account, identify the
name and address of the financial institution providing the letter of credit,
and provide a copy of the letter of credit executed in favor of the
Commissioner.
(A) The letter of credit shall
stipulate that the beneficiary need only draw a sight draft and present it to
obtain the funds, and that no other document need be presented.
(B) The letter of credit shall indicate that
it is not subject to conditions or qualifications outside the letter of
credit.
(C) The letter of credit
shall contain a clause which prevents the expiration of the letter of credit
without notice-minimum 30 days-from the issuer to the Commissioner.
(iii) If the applicant proposes to
deposit negotiable securities in lieu of using an entrance fee escrow account,
acceptable negotiable securities executed in favor of the Commissioner shall be
deposited at the time an application for a certificate of authority is
made.
(iv) If the applicant
proposes to post a bond issued by a surety company authorized to do business in
this Commonwealth in lieu of using an entrance fee escrow account, provide the
name and address of the surety company and a copy of the surety bond.
(11)
Biographical
affidavits. Biographical affidavits shall be filed by the following
persons:
(i) For applicants, the managers or
proposed managers shall file. If the manager is a corporation, provide
biographical affidavits for the board of directors and all officers. If the
manager is a partnership, provide biographical affidavits for the managing or
general partners.
(ii) For
corporate applicants, the corporation's board of directors and officers shall
file.
(iii) For partnership
applicants, managing or general partners shall file.
(iv) For unincorporated association
applicants, officers and directors shall file.
(v) For trust applicants, administrators or
trustees shall file.
(b) In addition to the information described in subsection (a), applicants may be requested to provide the Department with other pertinent material that is deemed necessary to complete the Department's review of the application.
This section cited in 31 Pa. Code § 151.3 (relating to certificates of authority).
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