(1)It is the purpose of this section to establish a
receivership mechanism that will be available as a remedy for such violations of
applicable laws and regulations by a licensee of a long-term health-care facility
that require facility closure by the department of public health and environment in
order to safeguard against potential transfer trauma resulting from relocation of its
residents as a result of closure of the facility.
(2)The department of public health and environment, the licensee or owner
of a long-term health-care facility, or the lessee of such facility with the approval of
the owner may apply to the district court for the appointment of a receiver to
operate the long-term health-care facility when:
(a)The department of public health and environment has refuse
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(1) It is the purpose of this section to establish a
receivership mechanism that will be available as a remedy for such violations of
applicable laws and regulations by a licensee of a long-term health-care facility
that require facility closure by the department of public health and environment in
order to safeguard against potential transfer trauma resulting from relocation of its
residents as a result of closure of the facility.
(2) The department of public health and environment, the licensee or owner
of a long-term health-care facility, or the lessee of such facility with the approval of
the owner may apply to the district court for the appointment of a receiver to
operate the long-term health-care facility when:
(a) The department of public health and environment has refused to issue a
renewal license or has revoked the license of such facility and the action of the
department is final; or
(b) The department of public health and environment, through the executive
director thereof, has taken summary action to suspend the license of any such
facility in accordance with the provisions of section 24-4-104 (4), C.R.S.
(3) The action of the department of public health and environment with
respect to nonrenewal or revocation of a license and recommendation for
certification for medicaid participation shall not be final for the purposes of
paragraph (a) of subsection (2) of this section until all administrative hearings and
judicial appeals sought by a licensee of a long-term health-care facility have been
exhausted or the time permitted for the same has expired and until the decisions
resulting from any such appeals, if any, sustain the action of said department.
(4) Application for the appointment of a receiver pursuant to this section
shall be to the district court for the county where the long-term health-care facility
is located. No hearing on such application shall be held sooner than seventy-two
hours after the licensee of such facility has been served with notice thereof, as
provided in the Colorado rules of civil procedure; except that when the department
exercises its summary powers, an emergency receiver may be appointed upon
agreement in writing between the department and licensee, with the approval of
the owner, until a hearing for appointment of a receiver as provided in this section.
Notice shall also be served upon any owner and any lessee of a long-term health-care facility and any holder of a security interest of record in said facility. An
application for appointment of a receiver pursuant to this section shall have
precedence and priority over any civil or criminal case pending in the district court
wherein the application is filed.
(5) For the purposes of this section, the action of the department of public
health and environment exercised pursuant to subsection (2) of this section shall
become effective upon appointment of the receiver of the court.
(6) Prior to ordering the appointment of a receiver for the operation of a
long-term health-care facility, the district court must find:
(a) That grounds for the appointment of a receiver exist as provided in
subsection (2) of this section; and
(b) That proper notice as required by subsection (4) of this section has been
served; and
(c) That there is a necessity to continue care on a temporary basis at the
facility to avoid potential transfer trauma which would serve the best interests of
the residents of the facility pending arrangements for the lease, sale, or closure of
the facility.
(7) The department of public health and environment shall grant the receiver
a license pursuant to section 25-3-102 and shall recommend certification for
medicaid participation, and the department of health care policy and financing and
the Colorado healthcare affordability and sustainability enterprise shall reimburse
the receiver for the long-term health-care facility's medicaid residents pursuant to
sections 25.5-6-204 and 25.5-4-402.4 (5.7).
(8) The appointment of the receiver shall be in accordance with and
governed by the provisions of rule 66 of the Colorado rules of civil procedure. The
court shall enter an order of appointment and fix the fees and expenses of the
receiver. The receiver shall be a licensed nursing home administrator and shall post
a bond with adequate sureties as determined by the court, and the receiver may be
sued upon the same in the name of the people of the state of Colorado at the
instance and for the use of any party injured. The receiver shall perform duties,
assume responsibilities, and preserve the long-term health-care facility property in
accordance with established principles of law for receivers of real property. Such
duties and responsibilities shall be determined by the court following a hearing, at
which time the parties may appear and be heard. The court shall specify the duties
and responsibilities of the receiver in the order of appointment. No security interest
in any real or personal property comprising said facility or contained within the
facility nor any fixture of the facility shall be impaired or diminished by the receiver,
but the receiver shall comply with the standards of the department of public health
and environment in providing health care to patients.
(9) Nothing in this section shall prevent the court from altering or amending
the terms and conditions of the receivership or the receiver's responsibilities and
duties following a hearing, at which time the parties may appear and be heard; and
nothing in this section shall prohibit the parties from stipulating to the terms and
conditions of the receivership and the responsibilities and duties of the receiver,
including the duration thereof, and such stipulation shall be submitted to the court
for approval.
(10) A receivership established pursuant to this section may be terminated
by the court upon application therefor by the licensee of a long-term health-care
facility, the department of public health and environment, or the receiver. The
receivership may be terminated upon a finding by the court that the receivership is
no longer necessary, but in no case shall the receivership continue for longer than
one hundred eighty days from the date of the initial appointment of the receiver
unless extended by written agreement of the parties as provided in subsection (9)
of this section.
(11) Upon termination of the receivership, the court shall order a final
accounting and finally fix the fees and expenses of the receiver following a hearing,
at which time the parties may appear and be heard.