CCRC Reg. 140 Reform

LeadingAge NY continues to pursue reforms through the Department of Financial Services Regulation 140 (DFS Reg. 140), which relates to permitted investments for Continuing Care Retirement Communities (CCRCs). On Wed. Feb. 4, LeadingAge NY staff, counsel and members of our CCRC Reg. 140 workgroup met with DFS in anticipation of the agency publishing revised Reg. 140 standards in the State Register for public comment.

This meeting represented the culmination of a long process of advocacy on this issue, including our latest advocacy letter to DFS (please click here). Reg. 140 represents a critical issue in terms of setting the parameters by which a CCRC can invest the funds it holds in reserve. The CCRC is a unique senior service option in that it combines the three elements of health care, housing and insurance under one umbrella. Like any well managed insurance product, the CCRC must seek out the best balance in terms of minimal investment risk while maximizing returns. Maximizing returns is critical to the financial viability of the CCRC and also ensuring that community resident fees are minimized. In other words, a well-balanced investment policy ensures the financial viability of the CCRC, allows for capital investments and improvements and protects the resident’s investment in the community.

In general, our advocacy is based on seeking to bring the current Reg. 140 standards more in line with national CCRC investment strategies. Under the current, highly restrictive standards, New York CCRCs are unable to attain an investment return that keeps pace with the actual cost of capital and falls far short of returns attained in other states. LeadingAge NY is grateful to DFS for listening to the concerns of the industry. We are asking our CCRC members to stay tuned - we hope to see fast progress on this issue over the next few weeks.

Once again, we want to thank our CCRC Cabinet and Reg. 140 workgroup for the team effort on this issue. Members may be interested to know that one member of the Reg. 140 workgroup, Stephanie Chedid, is unfortunately unable to continue in that role. Stephanie’s research was a critical piece of making an undeniable case for Reg. 140 reform. Many thanks to Stephanie and best wishes as she takes on a new role as a CCRC executive in the Milwaukee area. Steve Backus of Cleary Gull Advisors worked closely with Stephanie on the Reg. 140 research and has already expressed his commitment to working with LeadingAge NY in continuing to support of our member CCRCs.

Contact: Patrick Cucinelli, pcucinellui@leadingageny.org, 518-867-8827