Sec. 17b-354. Moratorium on requests for additional nursing home beds. Exceptions. Continuing care facility. Construction. Financing. Regulations.
Sec. 17b-354. Moratorium on requests for additional nursing home beds. Exceptions. Continuing care facility. Construction. Financing. Regulations. (a) Except
for applications deemed complete as of August 9, 1991, the Department of Social Services shall not accept or approve any requests for additional nursing home beds or modify
the capital cost of any prior approval for the period from September 4, 1991, through June
30, 2012, except (1) beds restricted to use by patients with acquired immune deficiency
syndrome or traumatic brain injury; (2) beds associated with a continuing care facility
which guarantees life care for its residents; (3) Medicaid certified beds to be relocated
from one licensed nursing facility to another licensed nursing facility or to a small house
nursing home, as defined in section 17b-372, provided (A) the availability of beds in
an area of need will not be adversely affected; (B) no such relocation shall result in an
increase in state expenditures; and (C) the relocation results in a reduction in the number
of nursing facility beds in the state; (4) a request for no more than twenty beds submitted
by a licensed nursing facility that participates in neither the Medicaid program nor the
Medicare program, admits residents and provides health care to such residents without
regard to their income or assets and demonstrates its financial ability to provide lifetime
nursing home services to such residents without participating in the Medicaid program
to the satisfaction of the department, provided the department does not accept or approve
more than one request pursuant to this subdivision; (5) a request for no more than twenty
beds associated with a free standing facility dedicated to providing hospice care services
for terminally ill persons operated by an organization previously authorized by the Department of Public Health to provide hospice services in accordance with section 19a-122b; and (6) new or existing Medicaid certified beds to be relocated from a licensed
nursing facility in a municipality with a 2004 estimated population of one hundred
twenty-five thousand to a location within the same municipality provided such Medicaid
certified beds do not exceed sixty beds. Notwithstanding the provisions of this subsection, any provision of the general statutes or any decision of the Office of Health Care
Access, (i) the date by which construction shall begin for each nursing home certificate
of need in effect August 1, 1991, shall be December 31, 1992, (ii) the date by which a
nursing home shall be licensed under each such certificate of need shall be October 1,
1995, and (iii) the imposition of such dates shall not require action by the Commissioner
of Social Services. Except as provided in subsection (c) of this section, a nursing home
certificate of need in effect August 1, 1991, shall expire if construction has not begun
or licensure has not been obtained in compliance with the dates set forth in subparagraphs
(i) and (ii) of this subsection.
(b) For the purposes of subsection (a) of this section, "a continuing care facility
which guarantees life care for its residents" means: (1) A facility which does not participate in the Medicaid program; (2) a facility which establishes its financial stability by
submitting to the commissioner documentation which (A) demonstrates in financial
statements compiled by certified public accountants that the facility and its direct or
indirect owners have (i) on the date of the certificate of need application and for five
years preceding such date, net assets or reserves equal to or greater than the projected
operating revenues for the facility in its first two years of operation or (ii) assets or other
indications of financial stability determined by the commissioner to be sufficient to
provide for the financial stability of the facility based on its proposed financial structure
and operations, (B) demonstrates in financial statements compiled by certified public
accountants that the facility, on the date of the certificate of need application, has a
projected debt coverage ratio at ninety-five per cent occupancy of at least one and twenty-five one-hundredths, (C) details the financial operation and projected cash flow of the
facility on the date of the certificate of need application, to be updated every five years
thereafter, and demonstrates that fees payable by residents and the assets, income and
insurance coverage of residents, in combination with other sources of facility funding,
are sufficient to provide for the expenses of life care services for the life of the residents
to be made available within a continuum of care which shall include the provision of
health services in the independent living units, and (D) provides that any transfer of
ownership of the facility to take place within a five-year period from the date of approval
of its certificate of need shall be subject to the approval of the Commissioner of Social
Services in accordance with the provisions of section 17b-355; (3) a facility which
establishes to the satisfaction of the commissioner that it can provide for the expenses
of the continuum of care to be made available to residents by complying with the provisions of chapter 319f and demonstrating sufficient assets, income, financial reserves or
long-term care insurance to provide for such expenses and maintain financially viable
operation of the facility for a thirty-year period based on generally accepted accounting
practices and actuarial principles, which demonstration (A) may include making available to prospective residents long-term care insurance policies which are substantially
equivalent in value and coverage to policies precertified pursuant to section 38a-475,
(B) shall include establishing eligibility criteria and screening each resident prior to
admission and annually thereafter to ensure that his assets, income and insurance coverage are sufficient in combination with other sources of facility funding to cover such
expenses, (C) shall include entering into contracts with residents concerning monthly
or other periodic fees payable by residents for services provided, and (D) allowing
residents whose expenses are not covered by insurance to pledge or transfer income,
assets or proceeds from the sale of assets in amounts sufficient to cover such expenses;
(4) a facility which demonstrates it will establish a contingency fund, prior to becoming
operational, in an initial amount of five hundred thousand dollars which shall be increased in equal annual increments to at least one million dollars by the start of the
facility's sixth year of operation and which shall be replenished within twelve months
of any expenditure, provided the amount to be replenished shall not exceed two hundred
fifty thousand dollars annually until one million dollars is reached, to provide for the
expenses of the continuum of care to be made available to residents which may not
be covered by residents' assets, income or insurance, provided the commissioner may
approve the establishment of a contingency fund in a lesser amount upon the application
of a facility for which a lesser amount is appropriate based on the size of the facility;
and (5) a facility which is operated by management with demonstrated experience and
ability in the operation of similar facilities. Notwithstanding the provisions of this subsection, a facility may be deemed a continuing care facility which guarantees life care
for its residents if (A) the facility meets the criteria set forth in subdivisions (2) to (5),
inclusive, of this subsection, was Medicaid certified prior to October 1, 1993, and has
been deemed qualified to enter into a continuing care contract under chapter 319hh for
at least two consecutive years prior to filing its certificate of need application under
this section, provided (i) no additional bed approved pursuant to this section shall be
Medicaid certified; (ii) no patient in such a bed shall be involuntarily transferred to
another bed due to his eligibility for Medicaid and (iii) the facility shall pay the cost of
care for a patient in such a bed who is Medicaid eligible and does not wish to be transferred to another bed or (B) the facility is operated exclusively by and for a religious
order which is committed to the care and well-being of its members for the duration of
their lives and whose members are bound thereto by the profession of permanent vows.
On and after July 1, 1997, the Department of Social Services shall give priority to a
request for modification of a certificate of need from a continuing care facility which
guarantees life care for its residents pursuant to the provisions of this subsection.
(c) For the purposes of this section and sections 17b-352 and 17b-353, construction
shall be deemed to have begun if the following have occurred and the department has
been so notified in writing within the thirty days prior to the date by which construction
is to begin: (1) All necessary town, state and federal approvals required to begin construction have been obtained, including all zoning and wetlands approvals; (2) all necessary
town and state permits required to begin construction or site work have been obtained;
(3) financing approval, as defined in subsection (d) of this section, has been obtained;
and (4) construction of a structure approved in the certificate of need has begun. For
the purposes of this subsection, commencement of construction of a structure shall
include, at a minimum, completion of a foundation. Notwithstanding the provisions of
this subsection, upon receipt of an application filed at least thirty days prior to the date
by which construction is to begin, the commissioner may deem construction to have
begun if: (A) An owner of a certificate of need has fully complied with the provisions
of subdivisions (1), (2) and (3) of this subsection; (B) such owner submits clear and
convincing evidence that he has complied with the provisions of this subsection sufficiently to demonstrate a high probability that construction shall be completed in time
to obtain licensure by the Department of Public Health on or before the date required
pursuant to subsection (a) of this section; (C) construction of a structure cannot begin
due to unforeseeable circumstances beyond the control of the owner; and (D) at least
ten per cent of the approved total capital expenditure or two hundred fifty thousand
dollars, whichever is greater, has been expended.
(d) For the purposes of subsection (c) of this section, subject to the provisions of
subsection (e) of this section, financing shall be deemed to have been obtained if the
owner of the certificate of need receives a commitment letter from a lender indicating
an affirmative interest in financing the project subject to reasonable and customary
conditions, including a final commitment from the lender's loan committee or other
entity responsible for approving loans. If a lender which has issued a commitment letter
subsequently refuses to finance the project, the owner shall notify the department in
writing within five business days of the receipt of the refusal. The owner shall, if so
requested by the department, provide the commissioner with copies of all communications between the owner and the lender concerning the request for financing. The owner
shall have one further opportunity to obtain financing which shall be demonstrated by
submitting another commitment letter from a lender to the department within thirty days
of the owner's receipt of the refusal from the first lender.
(e) On and after March 1, 1993, financing shall be deemed to have been obtained
for the purposes of this section and sections 17b-352 and 17b-353 if the owner of the
certificate of need has (1) received a final commitment for financing in writing from a
lender or (2) provided evidence to the department that the owner has sufficient funds
available to construct the project without financing.
(f) Any decision of the Office of Health Care Access issued prior to July 1, 1993,
as to whether construction has begun or financing has been obtained for nursing home
beds approved by the office prior to said date shall be deemed to be a decision of the
Commissioner of Social Services for the purposes of this section and sections 17b-352
and 17b-353.
(g) (1) A continuing care facility which guarantees life care for its residents, as
defined in subsection (b) of this section, (A) shall arrange for a medical assessment to
be conducted by an independent physician or an access agency approved by the Office
of Policy and Management and the Department of Social Services as meeting the requirements for such agency as defined by regulations adopted pursuant to subsection (e) of
section 17b-342, prior to the admission of any resident to the nursing facility and shall
document such assessment in the resident's medical file and (B) may transfer or discharge a resident who has intentionally transferred assets in a sum which will render
the resident unable to pay the cost of nursing facility care in accordance with the contract
between the resident and the facility.
(2) A continuing care facility which guarantees life care for its residents, as defined
in subsection (b) of this section, may, for the seven-year period immediately subsequent
to becoming operational, accept nonresidents directly as nursing facility patients on a
contractual basis provided any such contract shall include, but not be limited to, requiring
the facility (A) to document that placement of the patient in such facility is medically
appropriate; (B) to apply to a potential nonresident patient the financial eligibility criteria
applied to a potential resident of the facility pursuant to said subsection (b); and (C) to
at least annually screen each nonresident patient to ensure the maintenance of assets,
income and insurance sufficient to cover the cost of at least forty-two months of nursing
facility care. A facility may transfer or discharge a nonresident patient upon the patient
exhausting assets sufficient to pay the costs of his care or upon the facility determining
the patient has intentionally transferred assets in a sum which will render the patient
unable to pay the costs of a total of forty-two months of nursing facility care from the
date of initial admission to the nursing facility. Any such transfer or discharge shall be
conducted in accordance with section 19a-535. The commissioner may grant one or
more three-year extensions of the period during which a facility may accept nonresident
patients, provided the facility is in compliance with the provisions of this section.
(h) Notwithstanding the provisions of subsection (a) of this section, if an owner of
an approved certificate of need for additional nursing home beds has notified the Office
of Health Care Access or the Department of Social Services on or before September
30, 1993, of his intention to utilize such beds for a continuing care facility which guarantees life care for its residents in accordance with subsection (b) of this section and has
filed documentation with the Department of Social Services on or before September
30, 1994, demonstrating the requirements of said subsection (b) have been met, the
certificate of need shall not expire.
(i) The Commissioner of Social Services may waive or modify any requirement of
this section, except subdivision (1) of subsection (b) which prohibits participation in
the Medicaid program, to enable an established continuing care facility registered pursuant to chapter 319hh prior to September 1, 1991, to add nursing home beds provided the
continuing care facility agrees to no longer admit nonresidents into any of the facility's
nursing home beds except for spouses of residents of such facility and provided the
addition of nursing home beds will not have an adverse impact on the facility's financial
stability, as defined in subsection (b) of this section, and are located within a structure
constructed and licensed prior to July 1, 1992.
(j) The Commissioner of Social Services shall adopt regulations, in accordance
with chapter 54, to implement the provisions of this section. The commissioner shall
implement the standards and procedures of the Office of Health Care Access concerning
certificates of need established pursuant to section 19a-643, as appropriate for the purposes of this section, until the time final regulations are adopted in accordance with said
chapter 54.
(P.A. 93-262, S. 23, 87; 93-381, S. 9, 39; 93-435, S. 59, 95; P.A. 94-236, S. 3, 10; P.A. 95-160, S. 9, 15, 16, 69; 95-257, S. 12, 21, 39, 58; 95-351, S. 18, 30; P.A. 96-139, S. 12, 13; P.A. 98-250, S. 27, 39; June Sp. Sess. P.A. 01-2, S. 53,
69; June Sp. Sess. P.A. 01-9, S. 129, 131; P.A. 02-135, S. 2; P.A. 05-280, S. 41; P.A. 06-196, S. 143; P.A. 07-209, S. 2;
P.A. 08-36, S. 5; 08-91, S. 2.)
History: P.A. 93-262 effective July 1, 1993; P.A. 93-381 and P.A. 93-435 authorized substitution of commissioner and
department of public health and addiction services for commissioner and department of health services, effective July 1,
1993; P.A. 94-236 amended Subsec. (a) to extend moratorium from June 30, 1994, to June 30, 1997, Subsec. (b) to prohibit
continuing care facilities from participating in Medicaid, require facilities to arrange for medical screening of prospective
patients, revise the way the facility demonstrates its ability to cover its expenses, increase the amounts that must be deposited
in contingency funds from initially $100,000 to $500,000 and increments from $250,000 to $1,000,000 and allow exceptions
from these amounts, clarify the definition of services and benefits that facilities provide, added new Subsec. (g) to allow
transfers and discharges of continuing care facility residents in certain circumstances and allow facilities to accept nonresidents into their nursing facilities, added new Subsec. (h) to specify the conditions under which a certificate of need for
continuing care facilities beds will not expire, added new Subsec. (i) to permit commissioner to waive or modify the
continuing care facility requirements except the Medicaid prohibition to enable development of up to three facilities, and
relettered Subsec. (g) as Subsec. (j), effective June 7, 1994; P.A. 95-160 extended the moratorium on requests for additional
nursing home beds or requests for modifying the capital cost of any prior approval in Subsec. (a) from June 30, 1997, to
June 30, 2002, added Subdiv. (3) providing for Medicaid certified beds to be relocated and made technical changes, added
Subsec. (b)(5)(A) outlining criteria by which a facility may be deemed a continuing care facility which guarantees life
care for its residents and replaced coordination, assessment and monitoring agency with access agency under Subsec. (g),
effective July 1, 1995; P.A. 95-257 replaced Commissioner and Department of Public Health and Addiction Services with
Commissioner and Department of Public Health and replaced Commission on Hospitals and Health Care with Office of
Health Care Access, effective July 1, 1995; P.A. 95-351 amended Subsec. (a)(3) deleting "a proposed nursing facility"
and therefore allowing Medicaid certified beds to be relocated only to another licensed nursing facility, effective July 1,
1995; P.A. 96-139 changed effective date of P.A. 95-160 but without affecting this section; P.A. 98-250 amended Subsec.
(i) to replace waiver to enable "the development of up to three continuing care facilities which provide life care for their
residents" with waiver to enable an established facility registered prior to September 1, 1991, and to add beds under
specified conditions, effective July 1, 1998; June Sp. Sess. P.A. 01-2 amended Subsec. (a) to extend the moratorium on
requests for additional nursing home beds or to modify the capital cost of any prior approval from June 30, 2002, to June
30, 2007, effective July 1, 2001; June Sp. Sess. P.A. 01-9 revised effective date of June Sp. Sess. P.A. 01-2 but without
affecting this section; P.A. 02-135 amended Subsec. (a) by adding Subdiv. (4) re request for no more than twenty beds;
P.A. 05-280 added Subsec. (a)(5) allowing Department of Social Services to accept a request of not more than twenty beds
from a free standing facility providing hospice care services to terminally ill persons, effective July 1, 2005; P.A. 06-196
made technical changes in Subsec. (a), effective June 7, 2006; P.A. 07-209 amended Subsec. (a) to extend moratorium on
requests for additional nursing home beds or to modify capital cost of any prior approval from June 30, 2007, to June 30,
2012, effective July 10, 2007; P.A. 08-36 amended Subsec. (g)(2) by allowing commissioner to grant one or more three-year extensions of period during which facility may accept nonresident patients; P.A. 08-91 amended Subsec. (a) by adding
additional exemption in Subdiv. (3) for Medicaid certified beds to be relocated to a small house nursing home and adding
Subdiv. (6) re exemption for new or existing Medicaid certified beds to be relocated within a municipality with a 2004
estimated population of 125,000, effective July 1, 2008.