32.02.01.02

.02 General Requirements to Offer Continuing Care.

A. A provider may not offer continuing care, enter into or renew an agreement for continuing care, begin construction for a new facility, or collect deposits for continuing care without having secured the necessary feasibility study approval or certificate of registration from the Department.

B. Submissions.

(1) The submissions described in this section shall be filed with and approved by the Department.

(2) Statement of Intent. Any person that intends to offer continuing care agreements for new units or to file a feasibility study under Regulation .05 of this chapter shall file a statement of intent with the Department at least 30 days before submission of the feasibility study.

(3) Application for Approval of Feasibility Study. A provider shall obtain approval by the Department of a feasibility study before a provider may collect deposits or enter into deposit agreements for new units. Deposits for new units collected after the feasibility study has been approved shall be maintained in an escrow account held in Maryland in a federally insured depository under an escrow agreement approved by the Department.

(4) Application for Preliminary Certificate. A preliminary certificate of registration is required before a provider may offer or enter into continuing care agreements for any new units.

(5) Application for Initial Certificate. An initial certificate of registration is required before a provider may operate a facility offering continuing care.

(6) Request for Approval to Use Deposits. A provider may not use deposits collected from subscribers for new units until:

(a) The Department has issued the provider an initial certificate of registration for any new units;

(b) Construction of the new units has been completed;

(c) A certificate of occupancy or equivalent has been obtained from the appropriate local jurisdiction; and

(d) Appropriate licenses or certificates required by MHCC, MDH, and the Department have been issued.

(7) Application for Renewal of Certificate of Registration. A current certificate of registration is required to continue to operate or maintain a facility offering continuing care.

C. All approvals and certificates of registration issued by the Department shall approve or certify a specific number of units designated by type as:

(1) Independent living;

(2) Assisted living;

(3) Comprehensive care; or

(4) Other type approved by the Department.

D. A provider who operates or plans to operate more than one facility shall file separately for each facility the submissions and applications set forth in §B of this regulation.

E. A provider may not begin construction of an expansion or renovation unless the provider has complied with the applicable provisions of Regulations .15 and .17 of this chapter. Any new capital addition that in a 2-year period will result in the construction of a number of independent living and assisted living units that is greater than 25 percent of the number of existing independent living and assisted living units is considered new development, is subject to §B of this regulation and Regulations .03—.09 of this chapter, and requires an initial certificate of registration to include the new units. Any new capital addition that is not an expansion and that does not involve the construction of independent living or assisted living units is not subject to review under Regulation .15 or .17 of this chapter. Any capital improvement or replacement that is not a renovation is not subject to Department review under Regulation .15 or .17 of this chapter. An expansion of comprehensive care beds, regardless of number, requires a certificate of need or a certificate of need exemption from MHCC.

F. A provider may not offer or enter into a deposit agreement or an agreement, unless the terms have been approved by the Department.

G. A provider may not disseminate advertising or circulars which are deceptive, misleading, or likely to mislead.

H. Special Conditions.

(1) A provider applying for a certificate of registration whose past or current performance in the operation of a continuing care facility, whether that facility is located within or outside of Maryland, causes the Secretary to question the provider's financial or administrative ability to maintain a continuing care facility in compliance with this chapter, shall submit to the Department evidence demonstrating financial or administrative soundness, or both, as the Secretary considers appropriate. This information is sought only in special circumstances and is not required as a matter of course.

(2) The Secretary shall:

(a) Approve the application unconditionally;

(b) Require the provider to use the services of a management firm; or

(c) Deny the application.

(3) A management firm required by §H(2)(b) of this regulation shall be selected by the provider subject to the approval of the Department. Approval of a management firm that currently does business in Maryland, has projects in good standing under the Act, and which has not had a fiduciary or consultant relationship with the Department may not be denied without cause. The management firm shall assume full operational and financial responsibilities. The Secretary may not require utilization of a management firm for a period that exceeds 24 months.

I. A party aggrieved by a decision of the Secretary under this regulation has the right to appeal under Regulation .36 of this chapter.

J. A provider who is denied approval of submissions required by §B(3), B(4), or E of this regulation may reapply 1 year after the date of denial.