GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1999

H	1 

HOUSE BILL 1176

Short Title:  Continuing Care Facilities/Liens.	(Public)

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Sponsors: Representative Insko.

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Referred to:  Insurance.

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April 15, 1999

A BILL TO BE ENTITLED
AN ACT TO PROTECT RESIDENTS IN CONTINUING CARE FACILITIES UPON THE LIQUIDATION OF A FACILITY OR THE INSOLVENCY OR BANKRUPTCY OF A PROVIDER BY IMPOSING A LIEN ON THE PROPERTY OF THE FACILITY OR THE PROVIDER.
The General Assembly of North Carolina enacts:
Section 1.  G.S. 58-64-45(f) reads as rewritten:
"(f)	In applying for an order to rehabilitate or liquidate a facility, the Commissioner shall give due consideration in the application to the manner in which the welfare of persons who have previously contracted with the provider for continuing care may be best served.  In furtherance of this objective, the proceeds of any lien pursuant to G.S. 58-64-48 may be used in full or partial payment of entrance fees, on behalf of residents of a facility being liquidated, to other facilities then in compliance with this Article."
Section 2.  Article 64 of Chapter 58 of the General Statutes is amended by adding a new section to read:
"§ 58-64-48.  Lien on behalf of residents.
Effective at the time a facility is first occupied by any resident, there is a lien on the real and personal property of the provider or facility to secure the obligations of the provider pursuant to existing and future contracts for continuing care.  A lien under this section shall remain in effect for a period of 10 years.  The lien may be foreclosed upon the liquidation of the facility or the insolvency or bankruptcy of the provider, and in that event the proceeds shall be used in full or partial satisfaction of obligations of the provider pursuant to contracts for continuing care then in effect."
Section 3.  This act becomes effective January 1, 2000, and applies to all continuing care facilities and providers that, on or after that date, hold a license under Article 64 of Chapter 58 of the General Statutes.