Health Care Facility Receivership Act.

ORIGINAL
House
ENGROSSED
Bill No
.
HB0063

ENROLLED ACT NO. 20,

HOUSE OF
REPRESENTATIVES

SIXTY-THIRD LEGISLATURE OF THE STATE OF WYOMING
2016 Budget Session

AN ACT relating to hospitals and health care facilities; creating a Health Care Facility Receivership Act; providing definitions; providing procedures and standards for establishing and terminating a receivership; establishing powers and duties of a receiver; and providing for an effective date.

Be It Enacted by the Legislature of the State of Wyoming:

Section 1
.

W.S. 35
‑
2
‑
1101 through 35
‑
2
‑
11
09

are
created to read:

ARTICLE 11
HEALTH CARE FACILity
Receivership

35
‑
2
‑
1101
.

Short title.

This act may be cited as the
"
Health Care Facility
Receivership Act.
"

35
‑
2
‑
1102
.

Definitions.

(a)

As used in this act:

(i)

"
Department
"
means the department of health;

(i
i)

"
Health care facility
"
means
any
facility licensed or certified by the department
that is a hospital or that normally provides twenty
‑
four (24) hour per day care for individuals, including the facility
'
s owner, operator or licensee
;

(iii
)

"
This act
"
means W.S. 35
‑
2
‑
1101 through 35
‑
2
‑
11
09
.

35
‑
2
‑
1103
.

Petition for receivership;
h
earing;
p
arties;
e
mergency
o
rder.

(a)

The department may file a petition
in the district court
to appoint a receiver for a health care facility
,

if
the facility
:

(i)

Is operating without a license or the facility
'
s license has been suspended, revoked or not timely renewed;
or

(ii)

Presents a situation, physical condition, practice or method of operation that
causes
an imminent danger of death or significant mental or physical harm to its residents or patients.

(b)

Service of process shall be made in any manner as provided by the Rules of Civil Procedure. If personal service cannot practicably or promptly be made as provided in the Rules of Civil Procedure, service may be made by delivery of the summons with the petition attached to any person in charge of the health care facility at the time service is made.

(c)

The court shall hold a hearing
on the merits of the petition
not later than ten (10) days after the date the petition is filed.

(d)

Following a hearing, the district court shall appoint the
director of the
department as the receiver if it finds by a preponderance of the evidence that any of the conditions in subsection (a) of this section exist.

(
e
)

The court may appoint a receiver upon an ex parte motion when affidavits, testimony or any other evidence
presented indicates there is a reasonable likelihood

that
any of the conditions in
paragraph
(a)(ii) of this section exist
.
Notice of the petition and ex parte order appointing the receiver shall be served in any manner as provided by the Rules of Civil Procedure and shall be posted in a conspicuous place inside the facility not later than twenty
‑
four (24) hours after issuance of the order.
A hearing on the
original
petition shall be held not later than five (5) days after the issuance of
the

ex parte
order unless
the health care facility consents
to a later date
or waives the hearing
.

(f)

Following any regular or ex parte hearing
,
the director of the department may designate
a qualified person, experienced in health facility management, to act as
the
receiver. The
designated person
shall be free of conflict of interest with the health
care
facility that is in receivership.

(g)

After the appointment of a receiver, the court shall conduct a hearing on the status of the rec
eivership every six (6) months.

35
‑
2
‑
110
4
.

Effect of appointment.

When a receiver is appointed under this act,
the health care facility
shall be divested of possession and control in favor of the receiver. The appointment of the receiver shall not affect the rights of the
health care facility
to defend against any claim, suit or action against
the

facility
, including, but not limited to, any licensure, certification or injunctive action taken by the department.

35
‑
2
‑
110
5
.

Powers and duties
of
a
receiver.

(a)

A receiver
appointed under this act
shall:

(i)

Have the same powers as a receiver under W.S. 1
‑
33
‑
104 and shall exercise
th
ose
powers
necessary to
remedy the conditions that constituted grounds for the imposition of
the
receivership, assure adequate health care for the residents or patients and preserve the assets and
property of the
health care facility
;

(ii)

Notify each resident or patient and each resident or patient
'
s guardian or conservator, if any, or other responsible party, if known
, of the receivership
;

(iii)

Collect incoming payments from all sources;

(iv)

Apply the current revenue and current assets of the health care facility to current operating expenses of the facility;

(v)

P
ay taxes against the health care facility which become due during the receivership
;

(vi)

Be entitled to take possession of all property
,
assets
and records

of
residents o
r
patients which are in the possession of the
health care facility
. The receiver shall preserve all property, assets and records of residents or patients of which the receiver takes possession.

(
b
)

In addition to the
powers and
duties provided in
subsection (a) of this section,
a receiver may exercise
the
following powers:

(i)

Assume the role of administrator and take control of day
‑
to
‑
day operations
of the health care facility
or name a
qualified
administrator to conduct the day
‑
to
‑
day operations of the health care facility subject to the supervision and direction of the receiver;

(ii)

Correct or eliminate any deficiency in the structure or furnishings of the health care facility that endangers the safety or health of the residents or patients while they remain in the facility, provided the total cost of correction does not exceed three thousand dollars
($3,000.00)
. The court may order expenditures for this purpose in excess of three thousand dollars
($3,000.00)
on application from the receiver
;

(iii)

Remedy violations of federal and state laws and regulations governing the operation of the health care facility;

(iv)

C
ontract
for or
hire agents and employees to
maintain and operate the facility
; and

(v)

Hire or discharge any employees including the health care facility
'
s administrator.

(c)

The receiver in its discretion may, but shall not be required to, defend any claim, suit or action against the receiver or the health care facility arising out of conditions, actions or circumstances occurring or continuing at the health care facility after the appointment of the receiver.

(d)

The
district
court may limit
or expand
the powers or duties of a receiver.

35
‑
2
‑
11
06
.

Termination of receivership.

(a)

The court, upon a moti
on by the receiver
,
the health care facility
or the owner of the physical facility
, may terminate the receivership if:

(i)

The receivership is no longer necessary because the conditions which gave rise to the
receivership no longer exist;

(ii
)

All of the residents in the facility have been transferred or discharged
and the facility is ready to be closed
; or

(iii)

The owner of the physical facility or the health

care facility enters into a lease or sale agreement with a prospective operator of the facility who is licensed or can be licensed by the department and who in the judgment of the department will likely remedy the cause of the receivership.

(b)

In its termination order, the court may include terms it deems necessary to prevent the
future occurrence of the
conditions
upon which the receivership was ordered
.

35
‑
2
‑
1
107
.

Priorities
.

(a)

During a receivership under this act, t
he following expenses and claims have priority in the following order:

(i)

The costs and expenses of the administration of the
health care
facility during the term of the receivership;

(ii)

Claims for:

(A)

Wages actually owing to employees, other than officers of the facility, for services rendered within three (3) months prior to the date of commencement of
the
receivership proceeding against the facility, but not exceeding one thousand dollars ($1,000.00) to each employee;

(B)

Secured claims, including claims for taxes and debts due the federal or any state or local government,
which are secured prior to the appointment of the receiver
.

(iii)

Claims by or on behalf of individual
patients or clients
for the cost of h
ealth care services which were
to be
provided
by the facility, but were not received by the
patient or client
for whom the care was paid;

(iv)

Unless otherwise provided by law, a
ll other claims of general creditors not falling within any other priority under this section, including claims for taxes and debts due to the federal government or any state or local government which are not secured claims;

(v)

Proprietary claims of shareholders, me
mbers
or
officers
of the health care facility.

(b)

Upon motion by a claimant or by one (1) of the parties to a receivership action under this act, the district court may amend the priorities listed in subsection (a) of this section and order payment of claims as may be necessary in the interest of justice.

35
‑
2
‑
11
08
.

Receiver
'
s liability.

(a)

The liability of the department

shall be limited as set forth in the Wyoming Governmental Claims Act
, W.S. 1
‑
39
‑
101 through 1
‑
39
‑
121,
for the operation of medical facilities and the provision of health care.

(b)

If a person is designated to act as a receiver pursuant to W.S. 35
‑
2
‑
1103(f) and is not covered by the Wyoming Governmental Claims Act, W.S. 1
‑
39
‑
101 through 1
‑
39
‑
121, the designated
receiver
shall only
be held liable in a personal capacity
for
the
designated
receiver
'
s own gro
ss negligence, intentional acts
or breach of fiduciary duty
.

35
‑
2
‑
11
09
.

Applicability.

The
receivership
provisions of W.S 1
‑
33
‑
101 through 1
‑
33
‑
110 shall apply to actions under this act to the extent that they do not conflict
with this act
.

Section
2
.

This
act is effective July 1,
201
6
.

(END)

Speaker of the House

President of the Senate

Governor

TIME APPROVED: _________

DATE APPROVED: _________

I hereby certify that this act originated in the
House
.

Chief
Clerk

1