Repeals Article 64, Continuing Care Retirement Communities, of GS Chapter 58. Instead, enacts new Article 64A, Continuing Care Retirement Communities, which provides as follows.

Part 1.

States the NCGA’s intent to promote the dignity and protect the health, safety, and welfare of older NC citizens by (1) encouraging the development of continuing care retirement communities and (2) requiring providers offering or providing continuing care in the State to be licensed and to be monitored and regulated by the North Carolina Department of Insurance (Department) under this new Article. Specifies that the Article applies to for-profit and non-profit providers.

Sets out and defines 42 terms as they are used in the Article in new GS 58-64A-5. Defines continuing care retirement community as a retirement community consisting of one or more structures where a provider renders continuing care to residents. A distinct phase of development approved by the Insurance Commissioner (the Commissioner) may be considered to be the continuing care retirement community when a project is being developed in successive distinct phases over a period of time. Defines provider as a person that offers or undertakes to provide continuing care under a continuing care or continuing care at home contract, or that represents himself, herself, or itself as providing continuing care. For the purposes of this Article, the term provider also includes a person who has been issued a permit to accept deposits, a start-up certificate, or a preliminary certificate. Defines continuing care as the rendering to an individual other than an individual related by blood, marriage, or adoption to the person rendering the care, of housing in an independent living unit, together with related services, including access, when needed, to progressive levels of health care, including either assisted living care, as defined in GS 131D-2.1, or nursing care, as defined in GS 131E-176, or both, regardless of whether the health care is provided at the continuing care retirement community where the individual resides or another location, or through a contractual relationship with a third party, pursuant to a contract effective for the life of the individual or for a period longer than one year. Defines continuing care at home as a program offered by a provider holding a permanent license under this Article that provides continuing care to an individual who is not yet receiving housing, which may include programs that offer an individual an opportunity to move to an independent living unit at a future date, if desired, according to the provider's established priority and admissions policies at the continuing care retirement community sponsoring the continuing care at home program.

Allows the Commissioner to adopt rules to implement the Article.

Prohibits a provider from paying a dividend or other distribution of equity or net assets in new GS 58-64A-15 after the Commissioner has determined that the provider is in a hazardous condition or has been determined to not be in satisfactory actuarial balance in an actuarial study filed with the Commissioner, or when the payment would have the effect of creating a hazardous condition in the provider or cause the provider to not be in satisfactory actuarial balance. 

Requires a person to have a certification, license, permit, or other approval from the Commissioner before offering or providing continuing care in this State in new GS 58-64A-20. Sets out seven acts that are considered to be engaging in the business of offering or providing continuing care, including accepting any deposit or any other payment related to continuing care; entering into any nonbinding or binding reservation agreement, continuing care contract, or continuing care at home contract; commencing construction or converting an existing building for a continuing care retirement community; and advertising or marketing to the general public any product similar to continuing care through the use of such terms as "life care," "life plan," "continuing care," or "guaranteed care for life," or similar terms, words, or phrases.

Prohibits, under new GS 58-64A-25, an applicant or a provider who intends to collect or does collect entrance fees from leasing land or real property from another person if the land or property is to be used as a material part of a continuing care retirement community operated by the applicant or provider without first obtaining approval from the Commissioner. Entrance fees are defined as the sum of any initial, amortized, or deferred transfer of consideration made or promised by, or on behalf of, an individual entering into a continuing care or continuing care at home contract. Sets out three factors that the Commissioner must consider when deciding whether to allow an applicant or provider to lease any of the real property of a continuing care retirement community.

Requires all filings required under the Article by applicants and providers to be submitted electronically in new GS 58-64A-30.

Allows the Commissioner, under new GS 58-64A-35 to waive or modify the Article’s provisions if there is a state of emergency or disaster; or there is an incident beyond a provider’s reasonable control that substantially affects the daily business operations of the provider or continuing care retirement community.

Lists types of contracts, leases, notices, approvals, studies, and other documents that are confidential and privileged and are not considered public record and are not subject to subpoena or discovery or admissible as evidence in private civil actions in new GS 58-64A-40. Allows the Commissioner to use the same documents and information in furtherance of any regulatory or legal action brought as a part of the Commissioner’s official duties. Sets out the steps the Commissioner must take before making those items public. Requires any information shared with the Commissioner that is not covered under these provisions but a person believes to be confidential or a trade secret to make it as such before submission to the Commissioner. Sets out provisions governing when the Commissioner may (1) share information, including confidential and privileged documents, with regulatory agencies or law enforcement or (2) receive information, including confidential and privileged items, from regulatory and law enforcement officials of other foreign or domestic jurisdictions, and how those documents must be treated.

Prohibits, in new GS 58-64A-45, providers from advertising a continuing care retirement community if the ad includes a statement or representation which materially conflicts with the disclosures required under this Article or materially conflicts with any continuing care or continuing care without lodging contract offered by the provider.

Part 2.

Enacts new GS 58-64A-70, setting forth a general review schedule in response to the following applications: (1) permit to accept deposits, (2) a start-up certificate, (3) a preliminary certificate, (4) a permanent license, (5) an expansion, (6) a continuing care at home license, (7) an  expansion notification, and (8) a request for approval pursuant to GS 58-64A-230, GS 58-64A-235, or GS 58-64A-240.

Requires a permit under new GS 58-64A-50 in order to market a proposed continuing care retirement community. Sets out the process for submitting the application to the Commissioner, including $200 application fee. Requires the Commissioner to comply with the review schedule set forth in new GS 58-64A-70 when responding to an application to accept deposits. Lists four conditions that must be met in order for the Commissioner to approve the application. Allows the applicant, after having been issued a permit, to: (1) disseminate materials describing the intent to develop a continuing care retirement community; (2) enter into non-binding reservation agreements; and (3) collect deposits in an amount not to exceed $5,000, to be placed in escrow and released on in accordance with Part 4 of this Article. Providers that have been issued a permit are required to file periodic status reports.

Allows a person to apply for a start-up certificate under new GS 58-64A-55 by submitting the required information and paying a $2,000 application fee. Requires the Commissioner to comply with the review schedule set forth in new GS 58-64A-70. Lists five conditions that must be met in order to approve the application. Once the certificate has been issued, requires the Commissioner to: (1) require the provider to submit periodic sales, development, and unaudited financial statements on a Commissioner-issued form and (2) post the disclosure statement of the continuing care retirement community on the Department of Insurance’s (Department) website. Allows the provider, after having been issued the certificate, to: (1) enter into binding reservation agreements and continuing care contracts; (2) accept entrance fees and deposits greater than $5,000, to be placed in escrow and only released in accordance with Part 4 of this Article; (3) begin site preparation work; and (4) construct model independent living units for marketing.

Allows a person to apply for a preliminary certificate under new GS 58-64A-60 by submitting the required information. Requires the Commissioner to comply with the review schedule set forth in new GS 58-64A-70. Lists eight conditions that must be met in order to approve the application. Once the certificate has been issued, requires the Commissioner to: (1) require the provider to submit periodic sales, development, and unaudited financial statements on a Commissioner-issued form and (2) post the disclosure statement of the continuing care retirement community on the Department’s website. Allows the provider, after having been issued the certificate, to: (1) construct a continuing care retirement community and (2) convert existing structure(s) into a continuing care retirement community.

Allows a person to apply for a permanent license under GS 58-64A-65 by submitting the required information. Requires the Commissioner to comply with the review schedule set forth in new GS 58-64A-70. Lists the two conditions that must be met in order to approve the application. Allows for the issuance of a restricted license. Once the license has been issued, requires the Commissioner to: (1) require the provider to submit periodic occupancy and financial statements on a Commission-issued form and (2) post the disclosure statement of the continuing care retirement community on the Department’s website. Allows the applicant, after having been issued a permanent license, to: (1) open the continuing care retirement community and (2) provide continuing care. Allows applicants that receive a restricted permanent license to operate a continuing care retirement community under restrictions established by the Commissioner until the Commissioner issues a permanent license. Provides that when a restricted license is issued, the provider must inform all depositors and residents within 10 business days of all restrictions imposed by the license and conditions that the provider must satisfy to qualify for a permanent license. Permanent licenses or restricted permanent licenses are valid for as long as the Commissioner determines that the provider continues to meet the Article's requirements.

Sets the duration of a permit to accept deposits and a start-up certificate at 36 months in GS 58-64A-75. Allows a person with a permit to accept deposits or a start-up certificate to request an extension and sets out the information that must be included in the request. Allows the Commissioner to extend the permit or certificate for up to one year if there is satisfactory cause for the delay, and allows the Commissioner to require the provider to update information that was previously filed before approving an extension. Does not limit the number of extensions that may be granted. Provides that if there is no satisfactory cause for the delay, the Commissioner must instruct the escrow agent to refund all deposits held in escrow, plus interest. Requires the provider, within 10 business days of denial of an extension, to notify each depositor of the denial, of the expiration of the permit or certificate, and of any right to a deposit refund.

Sets out the steps to be followed in new GS 58-64A-80 when the Commissioner denies an application, notification, or any other request for approval under this Article. Sets out the process under which applicants can demand a review to determine the reasonableness of the denial.

Part 3.

Requires a provider, under new GS 58-64A-85, before marketing and collecting deposits for a proposed expansion of a continuing care retirement community that is 20% or more of existing independent living units, to: (1) notify and obtain written approval from the Commissioner and (2) give all residents written warning of the intent to expand the number of units. Lists four required pieces of information that must be included in the notice to the Commissioner. Requires the Commissioner to comply with the review schedule set forth in new GS 58-64A-70. Lists four conditions that must be met in order for the Commissioner to approve the expansion notification. Once the notification has been approved, requires the Commissioner to require the provider to submit periodic sales and development reports. Allows the provider, after approval of the expansion notification, to: (1) disseminate materials, including advertisements, describing the intent to expand the number of independent living units at the continuing care retirement community; (2) enter into nonbinding reservation agreements, binding reservation agreements, and continuing care contracts for the proposed independent living units; and (3) collect entrance fees and deposits for the proposed independent living units, with deposits placed in escrow and only released in accordance with Part 4 of this Article, unless otherwise exempted by the Commissioner.

Requires a provider, in new GS 58-64A-90, before commencing construction of an expansion of a continuing care retirement community that is 20% or more of existing independent living units, to receive the Commissioner’s approval of an expansion notification and apply to the Commissioner for approval to commence construction. Sets out requirements for the expansion application, including a $1,000 application fee. Requires the Commissioner to comply with the review schedule set forth in new GS 58-64A-70. Lists six conditions that must be met in order to approve the expansion application. Once the application has been approved, requires the Commissioner to require the provider to submit periodic sales and development reports on a form prescribed by the Commissioner to monitor the expansion. Allows the provider, after approval of the expansion application, to commence construction of the new independent living units at the continuing care retirement community as proposed, and upon completion of construction and the satisfaction of all other legal requirements, open the expansion and provide continuing care to the residents of the new units.

Requires all entrance fees and deposits collected for independent living units in an expansion that requires approval from the Commissioner to be placed in escrow unless otherwise exempted by the Commissioner.

Part 4.

Requires entrance fees and deposits required under the Article to be deposited by the provider in an escrow account and maintained in a segregated account without commingling with other funds in new GS 58-64A-100. Requires the Commissioner to approve in advance the escrow agent and all terms governing the account. Specifies 12 provisions that must be included in the written escrow agreement between the provider and escrow agent in new GS 58-64A-105. Requires, in new GS 58-64A-110, for changes to the agreement to be approved by the Commissioner before they are used by the provider. Sets out provisions governing the delivery of the entrance fees or deposits to the escrow agent in new GS 58-64A-115. Sets out the manners in which the entrance fees and deposits must be maintained by the escrow agent in new GS 58-64A-120.

Requires, under new GS 58-64A-125 written approval from the Commissioner for interest, income, and other gains from funds held in escrow to be released or distributed. Sets out conditions for such approval. Requires interest to be distributed to the provider or depositors in accordance with the applicable agreement when the release of earnings is approved.

Prohibits, in new GS 58-64A-130, using funds in an escrow account as collateral without prior written approval from the Commissioner.

Requires a refund of the escrowed funds by the escrow agent upon written notice from the provider of: the death of a depositor, nonacceptance by the provider, voluntary cancellation, the denial of an application, or upon written notice from the Commissioner. Requires refunds to be paid within 10 business days after the escrow agent receives the notice.  Allows for delays of refunds based on voluntary cancellation of a continuing care contract or a binding reservation agreement that occurs after construction of the continuing care retirement community or expansion of a continuing care retirement community has begun until another depositor has reserved a similar unit and paid the necessary fee or deposit. Directs that such delays cannot exceed one year unless extended by the Commissioner upon a showing of good cause by the provider.   

Sets out the process for requirements for petitioning the Commissioner for the release of the following under GS 58-64A-140: (1) the first 25% of each escrowed entrance fee and deposit and (2) the remaining 75% of escrowed entrance fees and deposits. Sets out requirements for the release of those funds.

Part 5.

Lists thirteen defined terms in new GS 58-64A-145 that apply to Part 5 of the Article, Disclosure Statement. Requires a provider to prepare a disclosure statement in new GS 58-64A-150 for each continuing care retirement community operated or to be operated in the State that contains the 42 specified pieces of information, including: (1) specified information about the officers, directors, trustees, managers, managing or general partners, the provider’s controlling person (if applicable) or any person having a 10% or greater equity or beneficial interest in the provider and any person who will be managing the community on a day-to-day basis; (2) names of any other person who will be responsible for the financial and contractual obligations of the provider not already disclosed and the extent of their responsibilities; (3) the number of existing living units, or the number of units to be constructed at the community; (4) a description of any property rights of residents in the community; (5) circumstances under which a resident will be allowed to remain a resident at the community in the event of possible resident financial difficulties; (6) terms and conditions under which a contract may be canceled by the provider, or by the resident, and the conditions under which fees can be refunded; (7) conditions under which a provider may require a resident to move into another unit for their safety or for the provider’s good; and (8) a five-year prospective financial statement. Requires a copy of the most common continuing care and continuing care at home contract used by the provider to be attached to each disclosure statement. Sets out requirements for the disclosure statement’s cover page and for the readability of the disclosure statement. Requires the Commissioner to review the statement for completeness. Requires the Commissioner to post the current disclosure statement for each continuing care retirement community on the Department’s website.

Sets out requirements for the delivery of a disclosure statement to a person or their legal representative with whom a binding reservation agreement, continuing care contract, or continuing care without lodging contract is being entered into in new GS 58-64A-155. Sets out the required timing for delivery. Allows electronic delivery if the person consents. Requires an acknowledgment of receipt of a disclosure statement. Requires the provider to maintain copies of all disclosure statements and amendments filed with and recorded by the Commissioner for at least five years

Sets out conditions under which other revisions may be made to a disclosure statement in new GS 58-64A-165.

Part 6.

Sets out items that must be included in a binding reservation agreement, defined in GS 58-64A-5 as a binding contractual agreement between a provider and a depositor that requires the payment of a deposit to reserve the right to purchase continuing care, including the right to live in an independent living unit at a continuing care retirement community. A purchase and sale agreement for an independent living unit shall not be considered a binding reservation agreement for the purposes of this Article. Items that must be included in the agreement relate to rescinding the agreement, automatic cancellation of the agreement, the refund of money or other consideration transferred to the provider upon a rescinding or cancellation, and the computation of any refund due to a depositor for cancellation or termination.

Sets out the provisions that must be included in a continuing care contract under GS 58-64A-175, including the person’s right to rescind within the listed time period upon specified occurrences, automatic cancellations upon specified occurrences, and refunds, both upon specified occurrences and per the terms of the contract. Lists ten required specifications in the continuing care contract. Sets out a required notice to be given as part of the contract.

Part 7.

Requires a license under GS 58-64A-185 for a person to arrange or provide continuing care at home. Allows a provider with a permanent license or a restricted permanent license to apply for a continuing care at home license. Lists seven items that must be included in the application, including a $500 application fee. Requires the Commissioner to comply with the review schedule set forth in new GS 58-64A-70. Sets out five conditions that must be met to approve the application. Once the application has been approved, requires the Commissioner to require the provider to submit periodic reports to monitor the status of the program on a Commission prescribed form for monitoring of the continuing care at home program. Allows the applicant, after approval of the application, to arrange or provide continuing care at home, and requires filing an amended disclosure statement that contains the required information on continuing care at home.

Enacts new GS 58-64A-190, concerning continuing care at home contracts as follows. Sets out four items that must be included in a continuing care at home contract including the person’s right to rescind within the listed time period upon specified occurrences, automatic cancellations upon specified occurrences, and refunds, both upon specified occurrences and per the terms of the contract. Lists twelve required specifications in the continuing care at home contract. Sets out a required notice as part of the contract.

Part 8.

Requires providers, under GS 58-64A-195, to be audited annually by an independent CPA and to file those audited financial statements within the Commissioner within 150 days following the end of each fiscal year. Provides for 30-day extension of both the audit and annual disclosure statement by the Commission upon a request in writing and a determination of good cause. Directs, under GS 58-64A-200 for the annual audited financial statements to report the financial position of the provider as of the end of the most recent fiscal year and the results of its operations, cash flows, and changes in equity or net assets for the year then ended, by including six required prongs of information. Requires the audited financial statements to be comparative, except in the first year of submission. Lists four acceptable methods of preparation. Provides for separate reporting on continuing care at home programs, if the provider is also licensed for that service. Requires providers to submit (1) quarterly reporting on three listed matters under GS 58-64A-205 and (2) actuarial studies at least every three years which is prepared in accordance with accepted actuarial standards of practice for each continuing care retirement community operated by the provider in this State and any continuing care at home program that the provider is licensed for pursuant to this Article under GS 58-64A-210. Sets out additional requirements governing the actuarial study. Exempts from these actuarial study requirements a provider that only offers health care on a fee-for-service basis or only provides a limited discount or a limited number of free days in a long-term care facility; sets out documents that these individuals must provide instead. Allows the Commission to require additional reporting, as follows if it determines that additional information is needed to properly monitor the financial condition or operations of a provider or continuing care retirement community or is otherwise needed to protect the interests of residents and the general public: (1) monthly unaudited financial statements and (2) any other data, financial statements, and pertinent information as the Commissioner may reasonably require regarding (i) the provider, (ii) the provider's obligated group, (iii) the continuing care retirement community, or (iv) any related party, if the provider relies on a contractual or financial relationship with the related party in order to meet the financial requirements of the Article, or has a material amount invested in, or has a material amount of receivables due from, the related party.

Part 9.

Requires a provider to notify the Commissioner and all residents in writing within ten business if one of six listed events in GS 58-64A-220 occur, including if the provider plans to reduce the number of living units at a continuing care retirement community by 20% or more, change in the provider’s name or the name of a continuing care retirement community, including the adoption of an assumed business name, any proceeding for denial, suspension, or revocation of any license or permit needed to operate all or part of a continuing care retirement community in the State, entrance fee funds that are more than 30 days past due, and failure to maintain the required operating reserve. Requires, under GS 58-64A-225, for an applicant or provider to notify the Commissioner of material changes or deviations (defined) in any information submitted to the Commissioner pursuant to the Article within ten business days after the applicant or provider becomes aware of the change or deviation. Permits Commissioner to take action against the applicant’s or provider’s application or license if the notice is not provided. 

Part 10. 

Prohibits a permit, certificate, or license issued under the Article from being transferred under GS 58-64A-230. Specifies such things have no value for sale or exchange as property.  Requires approval from the Commissioner before a provider or other owner can begin to sell or transfer any real property or interest therein that is used in the operations of a continuing care retirement community, other than the sale of an independent living unit to a resident or other transferee. Requires the Commissioner to comply with the review schedule set forth in new GS 58-64A-70. Requires a provider to get approval from the Commissioner before consummating any purchase of real property currently leased and used by the provider in the operations of a continuing care retirement community. Sets out requirements for the timing and content of the requests for these transactions. Sets out three conditions that must be met in order to approve the request. Allows the Commissioner to revoke or restrict a certificate or license of a provider or take other administrative actions if a provider violates these provisions.

Requires, under GS 58-64A-235, the Commissioner’s approval to enter into an agreement to merge with, or otherwise acquire control of, a provider holding a certificate or license under the Article. Requires the acquiring person to file the request for approval. Sets out the required content for the approval request. Requires the Commissioner to comply with the review schedule set forth in new GS 58-64A-70. Sets out the conditions that must be met to approve the request. Requires providers to give notice to all affected residents and depositors of the proposed merger or other acquisition of control within ten business days after receiving approval. Allows the Commissioner to revoke or restrict a certificate or license of a provider or take other administrative actions if a provider violates these provisions.

Requires approval from the Commissioner under GS 58-64A-240 before a provider enters into a contract with a third party for the management of a continuing care retirement community. Lists required elements of request for approval, including a copy of the proposed management contract. Requires notice to the residents in writing after provider submits request for approval and sets out requirements for providing notice. Requires the Commissioner to comply with the review schedule set forth in new GS 58-64A-70. Sets out conditions under which the Commissioner may disapprove of the proposed third-party manager and conditions under which the provider must immediately remove a third-party manager. 

Part 11.

Requires providers, in GS 58-64A-245, to maintain after the opening of a continuing care retirement center an operating reserve equal to 50% of the total operating costs of the community forecasted or projected for the 12-month period following the period covering the most recent disclosure statement. Provides that once a community achieves a 12-month daily average independent living unit occupancy rate of 90% or higher, a provider is only required to maintain an operating reserve in the amount specified, with amounts ranging from 25% to 50% depending on the occupancy rate. Provides that for providers whose community has achieved a 12-month daily average independent living unit occupancy rate of 93% or higher and has no long-term debt or a debt service coverage ratio in excess of 2.00 as of the provider's most recent fiscal year-end, the operating reserve required is only equal to 12.5% of total operating costs of the continuing care retirement community, unless otherwise instructed by the Commissioner. Allows the Commissioner to increase the operating reserve amount, not exceed 50% of total operating costs, or to require that a provider immediately place the operating reserve on deposit with the Commissioner if the provider is in a hazardous condition. Sets out related resident notification requirements. Sets out provisions for calculating the operating reserve amount in GS 58-64A-258. Specifies the types of assets that can be used by a provider to fund the operating reserve in GS 58-64A-255.  

Allows a provider, instead of funding the operating reserve with qualifying assets, to fund all or a portion of the reserve by filing a surety bond or letter of credit in GS 58-64A-260. Sets out the requirements for the surety bond or letter of credit. 

Requires approval from the Commissioner under GS 58-64A-265 before an operating reserve can be released in whole or in part. Sets out requirements for the request. Allows disapproval of the request to withdraw funds if it is determined that it would not be in the residents’ best interest. Sets out requirements for providing notice to residents. 

Requires providers to provide an annual certification relating to its operating reserves under GS 58-64A-270 at the same time it files its annual audited financial statements. Lists three required information in the certification, including the amount the provider is required to hold in its operating reserve, a description of the qualifying assets or other form of security that the provider maintains for its operating services, and the 12-month daily average independent living unit occupancy rate at the continuing care retirement community, or a shorter period of time that the continuing care retirement community has been in operation, as of the date of certification.

Part 12.

Defines impaired in GS 58-64A-275 as a weakened financial state or condition that may affect a provider's ability to pay its obligations as they come due in the normal course of business. Allows the Commissioner, upon issuing findings of fact, to (1) deny an application or any other request for approval or (2) restrict or revoke any permit, certificate, license, or other authorization issued under the Article if the Commissioner finds that the applicant or provider committed one of the 18 specified acts, including: (1) willfully violated any provision of this Article or the Commissioner’s rules or orders; (2) engaged in fraudulent or dishonest business practices; (3) failed to maintain the escrow account; (4) violated a restriction of its permit, certificate, or license; or (5) has been determined to be in a hazardous condition. Permits the Commissioner to first issue a cease-and-desist order; if the order is not or cannot be effective in remedying the violation, allows the Commissioner, after notice and hearing, to order revocation. Allows a revocation order to be appealed to the Wake County Superior Court. Directs the provider to not accept new deposits or entrance fees while the revocation order is under appeal. Allows the Commissioner to remove a restriction upon finding changed circumstances. Sets out requirements for notice to residents. Specifies that revocation does not release a provider from obligations assumed through continuing care and continuing care at home contracts. Requires the provider to provide the Commissioner and residents a written plan detailing how the provider will continue to meet its continuing care obligations within 20 business days after receiving notice of revocation of a license. Requires providers with revoked licenses to maintain its operating reserves and to continue filing disclosers. Requires providers who have had a permit, license, or certificate revoked to provide written notice to all depositors within five business days, reimburse all deposits collected, and provide documentation to the Commissioner verifying that all deposits have been returned to depositors.

Sets out fifteen standards that the Commissioner may consider in determining whether a provider is in a hazardous condition under GS 58-64A-285, including: (1) whether the provider is impaired or insolvent; (2) adverse findings reported in examination reports, audit reports, and actuarial opinions, reports, or summaries; (3) whether the provider has failed to establish, maintain, or has substantially depleted the required operating reserve; (4) whether the management of a provider has failed to respond to the Commissioner's inquiries about the condition of the applicant or provider or has furnished false and misleading information in response to an inquiry by the Commissioner; or (5) whether the applicant or provider has experienced or will experience in the foreseeable future cash flow or liquidity problems. 

Allows the Commissioner, upon determining that a provider is in a hazardous condition, to issue an order, after notice and opportunity for hearing, requiring a provider to (1) submit a corrective action plan within 45 days and (2) notify all residents and depositors within five business days of the Commissioner's order in GS 58-64A-290. Requires the corrective action plan to include: (1) proposals of corrective actions the provider intends to take which would reasonably be expected to result in the elimination of the hazardous condition and (2) a date when the provider anticipates it will rectify the problems and deficiencies. Sets out the timeline under which the Commissioner must act on the plan. Allows for submission of a revised plan based on notification from the Commissioner. Requires immediate implementation of an approved plan, distribution of the plan to residents and depositors, and reporting progress to the Commissioner. Allows the Commissioner to engage consults to develop a corrective action plan when a submitted plan is disapproved. 

Sets out the Commissioner’s investigative and subpoena powers in GS 58-64A-295. 

Makes a provider civilly liable under GS 58-64A-300 for entering into a binding reservation agreement, continuing care contract, or continuing care at home contract without having first delivered a disclosure statement to the person with whom the agreement or contract was entered into, or for entering into a binding reservation agreement, continuing care contract, or continuing care at home contract with a person who has relied on a disclosure statement that materially misrepresents or omits a material fact required to be stated or necessary in order to make the statement, in light of the circumstances under which they are made, not misleading. Specifies that liability exists regardless of whether the provider had actual knowledge of the misstatement or omission. Prohibits a person from bringing an action if the person was offered and failed to timely accept an offer of a refund that meets the specified amounts. Requires the action to be brought within three years of the alleged violation. 

Makes it a Class 1 misdemeanor under GS 58-64A-305 to willfully and knowingly violate the Article.  

Sets out the conditions under which a permit, certificate, license, or other approval must be forfeited, after notice and opportunity for hearing, in GS 58-64A-310. Sets out requirements for notifying residents and depositors of forfeiture. 

Allows the Commissioner, after determining that a provider is or has been violating the Article, in GS 58-64A-315, to, after notice and opportunity for hearing, order the provider to cease entering into binding reservation agreements, continuing care contracts, and continuing care at home contracts and make a rescission offer to any resident or depositor who entered into such an agreement or contract while the violation was occurring. Allows for the agreements and contracts to be rescinded without penalty by the resident or depositor. Bars residents and depositors from benefitting from this provision if they have refused or failed to timely accept an offer by the provider to rescind the agreement or contract and refund the full amount paid plus interest (less specified costs). 

Specifies that the civil, criminal, and administrative remedies available to the Commissioner pursuant to the Article are not exclusive.

Prohibits a provider from actively soliciting, approving the solicitation of, or entering into new binding reservation agreements, continuing care contracts, or continuing care at home contracts in this State after the provider knew, or reasonably should have known, that the provider was impaired or insolvent except with the Commissioner’s written permission. 

Part 13.

Sets out five triggers under any of which the Commissioner may commence supervision proceedings or apply to the Wake County Superior Court or federal bankruptcy court that may have previously taken jurisdiction over the provider or community for an order directing or authorizing the Commissioner to rehabilitate or to liquidate a provider or continuing care retirement community under GS 58-64A-335. Sets out requirements for providing notice to residents and depositors. Sets out the conditions under which the rehabilitation may be terminated and the community and its assets and affairs are returned to the provider’s management. Requires an order for rehabilitation to be refused or vacated if the provider posts a bond, as specified. 

Allows, under GS 58-64A-340, when the Commissioner has been appointed as a receiver for a provider or a continuing care retirement community, for the Department of Health and Human Services to accept and approve the addition of adult care home beds or nursing beds for a continuing care retirement community owned by, or operated by, the provider, if it appears to the Court upon petition of the Commissioner or provider, that (1) the best interests of the provider or (2) the welfare of persons who have previously contracted with the provider or may contract with the provider, may be best served by the addition of adult care home beds or nursing beds. 

Provides, in new GS 58-64A-345, that in the event of liquidation of a provider, all continuing care and continuing care at home contracts executed by the provider are deemed preferred claims against all of the provider’s assets (although claims are subordinate to the liquidator’s cost of administration or any secured claim). 

Section 14. 

Defines residents’ council as a group duly elected by residents at a continuing care retirement community to advocate for residents' rights and to serve as a liaison between residents and the provider with respect to resident welfare and interests. Gives a resident of a continuing care retirement community operated by a licensed provider the right of self-organization, the right to be represented by an individual of the resident's own choosing, and the right to engage in concerted activities to keep informed on the community’s operations or for other mutual aid or protection in GS 58-64A-355. Specifies that this includes the right to establish a residents' council. 

Requires the provider’s board of directors or other governing body or its designated representative to hold in-person semiannual meetings with the residents of each continuing care retirement community operated by the provider in this State for free discussions of subjects including specified topics. Specifies that a provider is allowed to make the semiannual meeting available via electronic means to residents who are unable to attend in person. Sets out requirements for providing notice of the meetings. Sets out emergency conditions under which the meetings can be held electronically. Provides for recording of electronic meetings held under emergency conditions. Requires the provider to include in its required disclosure statements the dates on which these semiannual meetings were held.

Part 15.

Provides in GS 58-64A-365 that no act, agreement, or statement of any resident, or of an individual purchasing continuing care for a resident under any continuing care or continuing care at home contract, is a valid waiver of any provision of this Article intended for the benefit or protection of the resident or the individual purchasing continuing care for the resident.  

Establishes a 12-member Continuing Care Advisory Committee in GS 58-64A-370 that is comprised of providers, residents, and professionals involved in the continuing care retirement community industry. Sets out additional membership requirements and sets membership terms at 3 years, with two consecutive terms allowed. Requires the Committee to: (1) act in an advisory capacity to the Commissioner on matters pertaining to the operation and regulation of continuing care retirement communities and continuing care without lodging programs; (2) report to the Commissioner on developments in the continuing care retirement community industry and problems or concerns of providers and residents; (3) recommend changes in relevant statutes and rules; (4) meet twice per year and (5) holding other meetings at times and places that the Committee Chair may direct.  

Provides in GS 58-64A-375 that this Article does not affect the authority of the Department of Health and Human Services or any successor agency otherwise provided by law to license or regulate any long-term care facility. Exempts continuing care retirement communities and providers licensed under this Article that are also subject to the provisions of the North Carolina Condominium Act from the provisions of GS Chapter 39A (Transfer Fee Covenants Prohibited), if the continuing care retirement community's declaration of condominium does not require the payment of any fee or charge not otherwise provided for in a resident's continuing care contract, or other separate contract for the provisions of membership or services. 

Allows the Commissioner, or designee, to visit a provider to examine its books and records. Also allows the Commissioner, or designee, to examine a person with a contractual or financial relationship with the provider, to the extent necessary to ascertain the provider’s financial condition, if the provider relies on a contractual or financial relationship with another person in order to meet the Article’s financial requirements.  Incorporates the provisions of GS 58-2-131, GS 58-2-132, GS 58-2-133, GS 58-2-134, GS 58-2-155, GS 58-2-180, GS 58-2-185, and GS 58-6-5 into the Article. 

Applies to contracts issued, renewed, or amended on or after December 1, 2025 as well as offenses committed on or after that date.