Section 33.506 - Actuarial Review Requirements(a) Applicability. This section applies to providers of a facility whose continuing care contracts offer future guarantees of long-term nursing care in excess of 365 consecutive days which develop actuarial liabilities.(b) Initial filing requirements. (1) Except as provided in paragraph (2) of this subsection, the provider of a facility subject to this section shall file with the Commissioner its most current actuarial review, as defined in § 33.2 of this title (relating to Definitions) before September 1, 1989.(2) A facility that is not eligible for the mandatory issuance of a certificate of authority under the Health and Safety Code, § 246.023, shall submit an actuarial review, if applicable, along with its application, as one of the filing requirements for a certificate of authority as provided in § 33.204 of this title (relating to Contents of Application).(3) Any actuarial review filed under paragraphs (1) or (2) of this subsection shall be performed within five years of the date of filing.(c) Satisfactory actuarial balance. The financial condition of a provider or facility is considered to be in satisfactory actuarial balance at a given date if: (1) its resources that are available for the facility's current residents (including the actuarial present value of periodic fees expected to be paid in the future by current residents) are greater than or equal to the actuarial present value of the expected costs of performing all remaining obligations to such residents under their contracts, with appropriate provision for surplus;(2) for a typical cohort of new residents calculated under the most likely scenario of assumptions regarding move-in rates, the sum of the advance fees paid at or before occupancy plus the actuarial present value at occupancy of the new residents' expected future periodic fees is greater than or equal to the actuarial present value at occupancy of performing all obligations assumed by the provider for such residents, with appropriate provision for surplus; the calculation of these amounts is to be done under at least two scenarios, at least one of which assumes the move-in rate of the most recent year in its projection; and(3) cash balances are projected to remain positive with respect to current and future residents for a period of at least 20 years.(d) Subsequent actuarial reviews. The provider shall file subsequent actuarial reviews with the department at least (or at a minimum) at five-year intervals from the date of filing of the initial actuarial review filed under subsection (b)(1) or (2) of this section. In addition, the provider shall file an actuarial review as requested by the Commissioner when the Commissioner believes that the facility is financially unsound, or the Commissioner determines that other circumstances exist which warrant such reviews. The Commissioner's request for such actuarial review shall set forth the specific reasons for such a request.28 Tex. Admin. Code § 33.506
The provisions of this §33.506 adopted to be effective March 9, 1989, 14 TexReg 991; amended to be effective March 1, 1990, 15 TexReg 880; amended to be effective March 14, 1996, 21 TexReg 1771.