Sec. 350.8. Test for solvency

(a) If an operator of a continuing care retirement community submits an actuarial study that indicates that the continuing care retirement community is not in satisfactory actuarial balance, the operator shall prepare a plan designed to achieve satisfactory actuarial balance and submit the plan to the superintendent for approval.

(1) The operator's plan shall include a discussion of the reasons causing the continuing care retirement community not to be in satisfactory actuarial balance, the detailed action steps to be taken that are designed to achieve satisfactory actuarial balance, and a discussion of each of the action steps included in the plan.

(2) The continuing care retirement community's qualified consulting actuary shall prepare an actuarial study or other appropriate actuarial communication that reflects the action steps in the operator's plan, the actuary's discussion of the operator's plan, and the actuary's estimate of when the community is projected to achieve satisfactory actuarial balance and how this estimate was developed.

(3) The operator's plan prepared pursuant to paragraph (1) of this subdivision and the appropriate actuarial communication prepared pursuant to paragraph (2) of this subdivision shall be submitted to the superintendent within 90 days of the preparation date of the actuarial study indicating that the continuing care retirement community is not in satisfactory actuarial balance.

(b) If the operator's plan prepared pursuant to subdivision (a) of this section is disapproved by the superintendent, or if the approved plan is not projected to achieve satisfactory actuarial balance within seven years or by the end of the community's 15th fiscal year of operation if later, then the continuing care retirement community shall be deemed to be insolvent.

(c) If, during monitoring of an operator's approved plan prepared pursuant to subdivision (a) of this section, the superintendent determines that the approved plan will not achieve satisfactory actuarial balance within the time frame indicated in subdivision (b) of this section, the operator upon notice shall have a 90 day period to prepare and submit for the superintendent's approval a revised plan as described in subdivision (a) of this section. If the operator's revised plan to achieve satisfactory actuarial balance is disapproved by the superintendent, or if the approved revised plan is not projected to achieve satisfactory actuarial balance within seven years or by the end of the community's 15th fiscal year of operation if later, then the continuing care retirement community shall be deemed to be insolvent.