House File 2263 - Reprinted HOUSE FILE 2263 BY COMMITTEE ON COMMERCE (SUCCESSOR TO HSB 554) (COMPANION TO SF 2153 BY COMMITTEE ON COMMERCE) (As Amended and Passed by the House February 21, 2024 ) A BILL FOR An Act relating to the insurance commissioner’s authority 1 concerning insurance producers, business entity producers, 2 and preneed sellers, continuing care retirement facilities, 3 and continuing care retirement programs. 4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 5 HF 2263 (2) 90 nls/ko/md

H.F. 2263 Section 1. Section 505.17, subsection 1, paragraph a, Code 1 2024, is amended to read as follows: 2 a. Information, records, and documents utilized for the 3 purpose of, or in the course of, investigation, regulation, 4 or examination of an insurance company , or insurance holding 5 company, an individual insurance producer, or a business entity 6 producer received by the division from some other governmental 7 entity which treats such information, records, and documents 8 as confidential, are confidential and shall not be disclosed 9 by the division and are not subject to subpoena. Such 10 information, records, and documents do not constitute a public 11 record under chapter 22 . 12 Sec. 2. Section 522B.11, subsection 1, paragraph q, Code 13 2024, is amended to read as follows: 14 q. Is the subject of an order of the securities 15 administrator of this state or any other state, province, 16 district, or territory, denying, suspending, revoking, 17 or otherwise taking action against a registration as a 18 broker-dealer, agent, investment adviser, or investment adviser 19 representative issued by any of the following: 20 (1) The securities administrator of this state or any other 21 state, province, district, or territory. 22 (2) The federal securities and exchange commission. 23 (3) The financial industry regulatory authority . 24 Sec. 3. Section 523A.807, subsection 3, paragraph a, Code 25 2024, is amended to read as follows: 26 a. Payment of a civil penalty of not more than one thousand 27 dollars for each violation, but not exceeding an aggregate of 28 ten thousand dollars during any six-month period, except that 29 if the commissioner finds that the person knew or reasonably 30 should have known that the person was in violation of such 31 provisions a section or rules adopted pursuant thereto to a 32 section , the penalty shall be not more than five thousand 33 dollars for each violation, but and not exceeding exceed an 34 aggregate of fifty thousand dollars during any six-month 35 -1- HF 2263 (2) 90 nls/ko/md 1/ 8

H.F. 2263 period. The commissioner shall assess the penalty on the 1 employer of an individual and not on the individual, if 2 the commissioner finds that the violations committed by the 3 individual were directed, encouraged, condoned, ignored, or 4 ratified by the individual’s employer. Any civil penalties 5 collected under this subsection shall be deposited as provided 6 in section 505.7 . 7 Sec. 4. Section 523D.1, subsections 2, 3, 4, 8, and 9, Code 8 2024, are amended to read as follows: 9 2. “Continuing care” means housing together with a continuum 10 of supportive services, home health services, nursing services, 11 medical services, or other health related services, furnished 12 to a resident, regardless of whether or not the lodging and 13 services are provided at the same location, together with 14 housing for residents that elect to live in a facility of 15 a provider, with or without other periodic charges, and 16 pursuant to one or more contracts effective for the life of the 17 resident or a period in excess of one year, including mutually 18 cancelable contracts, and in consideration of an entrance fee. 19 3. “Continuing care retirement community” means a facility or 20 program which provides continuing care to residents other than 21 residents related by consanguinity or affinity to the person 22 furnishing their care. 23 4. “Entrance fee” means an initial or deferred transfer to 24 a provider of a sum of money or other property made or promised 25 to be made as full or partial consideration for acceptance of 26 a specified individual in into a facility or a program if the 27 amount exceeds either of the following: 28 a. Five thousand dollars. 29 b. The sum of the regular periodic charges for six months 30 of residency . 31 8. “Provider” means a person undertaking through a lease or 32 other type of agreement to provide care in or from a continuing 33 care retirement community or senior adult congregate living 34 facility, even if that person does not own the facility. 35 -2- HF 2263 (2) 90 nls/ko/md 2/ 8

H.F. 2263 9. “Resident” means an individual, sixty years of age or 1 older, entitled to receive care in from a continuing care 2 retirement community or a senior adult congregate living 3 facility. 4 Sec. 5. Section 523D.1, Code 2024, is amended by adding the 5 following new subsection: 6 NEW SUBSECTION . 7A. “Program” means an organized set of 7 measures or activities undertaken by a provider to provide 8 continuing care services to an individual. 9 Sec. 6. Section 523D.2, Code 2024, is amended to read as 10 follows: 11 523D.2 Application of chapter. 12 This chapter applies to a provider who executes a contract 13 to provide continuing care or senior adult congregate living 14 services in a facility or program , or extend extends the term 15 of an existing contract to provide continuing care or senior 16 adult congregate living services in a facility or program , if 17 the contract requires or permits the payment of an entrance fee 18 to a person, and any of the following apply: 19 1. The facility or program is or will be located in this 20 state. 21 2. The provider or a person acting on the provider’s behalf 22 solicits the contract within this state for a facility or 23 program located in this state and the person to be provided 24 with continuing care or senior adult congregate living services 25 under the contract resides within this state at the time of the 26 solicitation. 27 Sec. 7. Section 523D.2A, unnumbered paragraph 1, Code 2024, 28 is amended to read as follows: 29 On or before March 1 of each year, a provider shall 30 file a certification with the commissioner in a manner and 31 according to requirements established by the commissioner. The 32 certification shall be accompanied by a one hundred dollar 33 administrative fee which fee shall be deposited as provided in 34 section 505.7 . The certification shall attest that according 35 -3- HF 2263 (2) 90 nls/ko/md 3/ 8

H.F. 2263 to the best knowledge and belief of the attesting party, 1 the facility or program administered by the provider is in 2 compliance with the provisions of this chapter , including 3 rules adopted by the commissioner or orders issued by the 4 commissioner as authorized under this chapter . The attesting 5 person may be any of the following: 6 Sec. 8. Section 523D.3, subsection 1, paragraph c, 7 unnumbered paragraph 1, Code 2024, is amended to read as 8 follows: 9 With respect to each person covered by paragraph “b” , and 10 if the facility or program will be managed on a day-to-day 11 basis by a person identified pursuant to paragraph “b” , or with 12 respect to the proposed manager, the following information: 13 Sec. 9. Section 523D.3, subsection 1, paragraphs f, h, and 14 k, Code 2024, are amended to read as follows: 15 f. The services provided or proposed to be provided under 16 contracts for continuing care or senior adult congregate living 17 services at the facility , including the extent to which medical 18 care is furnished. The disclosure statement shall clearly 19 state which services are included in basic contracts and which 20 services are made available at or by the facility at extra 21 charge. 22 h. The provisions which have been made or will be made, 23 if any, to provide reserve funding or security to enable the 24 provider to fully perform its obligations under contracts to 25 provide continuing care or senior adult congregate living 26 services at the facility , including the establishment of escrow 27 accounts, trusts, or reserve funds, together with the manner in 28 which the funds will be invested and the names and experience 29 of persons who will make the investment decisions. 30 k. Other material information concerning the facility , 31 program, or the provider required by the division of insurance 32 or which the provider wishes to include. 33 Sec. 10. Section 523D.6, subsection 1, paragraphs b, c, f, 34 g, h, j, k, m, and p, Code 2024, are amended to read as follows: 35 -4- HF 2263 (2) 90 nls/ko/md 4/ 8

H.F. 2263 b. The name and address of the facility or facilities , or 1 of the program . 2 c. The If a prospective resident elects to reside in housing 3 at the facility of a provider, the identification of the living 4 unit which the prospective resident will occupy. 5 f. A statement of the policy of the facility or program with 6 regard to any health or financial conditions upon which the 7 provider may require the resident to relinquish the resident’s 8 space in the designated facility or program . 9 g. A statement of the policy of the facility or program with 10 regard to the health and financial conditions required for a 11 person to continue as a resident or an enrollee in a program . 12 h. A statement of the policy of the facility or program with 13 regard to the conditions under which the resident is permitted 14 to remain in the facility or program in the event of financial 15 difficulties affecting the resident. 16 j. A statement of the policy of the facility or program 17 with regard to changes in accommodations and a description 18 of the procedures to be followed by the provider when the 19 provider temporarily or permanently changes the resident’s 20 accommodations within the facility or program , transfers the 21 resident from one level of care to another, or transfers the 22 resident to another health facility or program . 23 k. A description in clear and understandable language, in at 24 least ten point type, of the terms governing the refund of any 25 portion of the entrance fee in the event of discharge by the 26 provider, or cancellation by the resident, and a statement that 27 the provider shall not dismiss or discharge a resident from 28 a facility or program prior to the expiration of a resident 29 contract without just cause and sixty days written notice of 30 intent to cancel. The notice of dismissal or discharge shall 31 only be given upon a good faith determination that just cause 32 exists, and the notice shall be given in writing, signed by the 33 medical director, if any, and the administrator of the facility 34 or program . In an emergency situation only such notice as is 35 -5- HF 2263 (2) 90 nls/ko/md 5/ 8

H.F. 2263 reasonable under the circumstances is required. 1 m. A description of the facility’s or program’s policies 2 and procedures for handling grievances between the provider and 3 residents. 4 p. A statement that if a resident dies or through illness, 5 injury, or incapacity is precluded from becoming a resident 6 under the terms of the contract before occupying the living 7 unit , or precluded from commencing a continuing care services 8 program under the terms of the contract , the contract is 9 automatically rescinded and the resident or the resident’s 10 legal representative shall receive a full refund of all 11 payments of money or transferred property to the facility 12 or program , except those costs specifically incurred by the 13 facility or program at the request of the resident or program 14 enrollee and set forth in writing in a separate addendum, 15 signed by both parties to the contract. 16 Sec. 11. Section 523D.6, subsection 2, Code 2024, is amended 17 to read as follows: 18 2. Cancellation. The contract required by this section 19 shall state the terms under which the contract can be canceled 20 by the provider , or the resident, or a program enrollee, 21 including a statement of the refund rights of a resident, 22 or a program enrollee, and shall include a completed, 23 easily detachable form in duplicate, captioned “Notice 24 of Cancellation”, as an attachment, in ten point boldface 25 type, containing the following information and statements in 26 substantially the following form and language: 27 NOTICE OF CANCELLATION 28 ........ 29 Date contract was executed. 30 ........ 31 Date disclosure statement was provided 32 to resident or program enrollee . 33 You may rescind and cancel your contract, without any penalty 34 or obligation, within three business days of the date the 35 -6- HF 2263 (2) 90 nls/ko/md 6/ 8

H.F. 2263 contract was executed or within thirty days after the date 1 you received the disclosure statement required by Iowa Code 2 section 523D.3 , whichever is later. You are not required to 3 move into the facility or commence continuing care services 4 from the program before the expiration of this cancellation 5 period. However, if you do, the provider may retain the 6 reasonable value of care and services actually provided to you, 7 the resident, prior to your vacating the provider’s facility 8 or terminating continuing care services from the program . If 9 you cancel this contract and you have already moved into the 10 provider’s facility, you must vacate your living unit within 11 ten days after receipt by the provider of your cancellation 12 notice. 13 If you cancel this contract, any payments of money or 14 transfers of property you made to the provider must be returned 15 as soon as reasonably possible by the provider following 16 receipt by the provider of your cancellation notice, and any 17 security interest arising out of the transaction is canceled, 18 except that, as stated above, the provider may retain the 19 reasonable value of care and services actually provided to you 20 prior to your vacating the provider’s facility or terminating 21 continuing care services from the program . 22 To cancel this contract, mail by certified mail or hand 23 deliver a signed and dated copy of this cancellation notice 24 or any other written notice clearly indicating your intent to 25 cancel the contract, or send a telegram, to ........ (name 26 of provider) at ........ (address of provider’s place of 27 business). Your cancellation is effective upon mailing by 28 certified mail, when transmitted by telegraph, or when actual 29 notice is given to the provider, whichever is earlier. 30 I hereby cancel this contract. 31 ...... 32 (Date) 33 ............ 34 (Resident’s signature) 35 -7- HF 2263 (2) 90 nls/ko/md 7/ 8

H.F. 2263 Sec. 12. Section 523D.7, subsection 1, paragraphs a and b, 1 Code 2024, are amended to read as follows: 2 a. Enters into a contract to provide continuing care or 3 senior adult congregate living services at a facility without 4 having first delivered a disclosure statement meeting the 5 requirements of this chapter to the person contracting for 6 continuing care or senior adult congregate living services and 7 to the person’s personal representative if one is appointed by 8 the person. 9 b. Enters into a contract to provide continuing care or 10 senior adult congregate living services at a facility with a 11 person who has relied on a disclosure statement which contains 12 any untrue statement of a material fact or omits to state a 13 material fact necessary in order to make the statements made, 14 in light of the circumstances under which they are made, not 15 misleading. 16 -8- HF 2263 (2) 90 nls/ko/md 8/ 8