N.Y. Mental Hygiene Law § 32.20: Temporary operator

§ 32.20 Temporary operator. 1. For the purposes of this section:

(a) "chemical dependence treatment program" shall mean a program

certified pursuant to section 32.05 of this article;

(b) "established operator" shall mean the operator of a chemical

dependence treatment program that has been established and issued an

operating certificate pursuant to section 32.05 of this article;

(c) "temporary operator" shall mean any OASAS staff member, person or

entity that:

(i) agrees to operate a program on a temporary basis in the best

interests of its patients and the community served by the program;

(ii) has demonstrated that he or she has the character, competence and

ability to operate an OASAS-certified program in compliance with

applicable standards; and

(iii) prior to his or her appointment as temporary operator, develops

with guidance from the commissioner a satisfactory plan to address the

program's deficiencies;

(d) "serious financial instability" shall include but not be limited

to defaulting or violating key covenants of bond issues, missed mortgage

payments, general untimely payment of debts, failure to pay its

employees or vendors, insufficient funds to meet the general operating

expenses of the program and/or facility, failure to maintain required

debt service coverage ratios and/or, as applicable, factors that have

triggered a written event of default notice to the office by the

dormitory authority of the state of New York; and

(e) "extraordinary financial assistance" shall mean state funds

provided to, or requested by, a program for the express purpose of

preventing the closure of the program that the commissioner finds

provides essential and necessary services within the community.

2. (a) In the event that: (i) the program is seeking extraordinary

financial assistance; (ii) office collected data indicates that the

program is experiencing serious financial instability issues; (iii)

office collected data indicates that the program's board of directors or

administration are unable or unwilling to ensure the proper operation of

the program; or (iv) office collected data indicates there are

conditions that seriously endanger or jeopardize continued access to

necessary chemical dependence treatment services within the community,

the commissioner shall notify the established operator of his or her

intention to appoint a temporary operator to assume sole responsibility

for the program's treatment operations of that facility for a limited

period of time. The appointment of a temporary operator shall be

effectuated pursuant to this section, and shall be in addition to any

other remedies provided by law.

(b) The established operator of a program may at any time request the

commissioner to appoint a temporary operator. Upon receiving such a

request, the commissioner may, if he or she determines that such an

action is necessary, enter into an agreement with the established

operator for the appointment of a temporary operator to restore or

maintain the provision of quality care to the patients until the

established operator can resume operations within the designated time

period; the patients may be transferred to other OASAS-certified

providers; or the program operations of that facility should be

completely discontinued.

3. (a) A temporary operator appointed pursuant to this section shall

use his or her best efforts to implement the plan developed with the

guidance of the commissioner to correct or eliminate any deficiencies in

the program and to promote the quality and accessibility of chemical

dependence treatment services in the community served by the program.

(b) If the identified program deficiencies cannot be addressed in the

time period designated in the plan, the patients shall be transferred to

other OASAS-certified providers.

(c) During the term of his or her appointment, the temporary operator

shall have the authority to direct the program staff of the facility in

all aspects necessary to appropriately treat and/or transfer the

patients. The temporary operator shall, during this period, operate the

program in such a manner as to promote safety and the quality and

accessibility of chemical dependence treatment services in the community

served by the facility until either the established operator can resume

program operations or until the patients are appropriately transferred

to other OASAS-certified providers.

(d) The temporary operator shall also be afforded access to a

program's accounts and records in order to address any deficiencies

related to a program experiencing serious financial instability or a

program requesting financial assistance in accordance with this section.

The temporary operator shall approve any financial decision related to a

program's day to day operations or program's ability to provide chemical

dependence services.

(e) The temporary operator shall not be required to file any bond. No

security interest in any real or personal property comprising the

facility or contained within the facility or in any fixture of the

facility, shall be impaired or diminished in priority by the temporary

operator. Neither the temporary operator nor the office shall engage in

any activity that constitutes a confiscation of property.

4. The temporary operator shall be entitled to a reasonable fee, as

determined by the commissioner, and necessary expenses incurred during

his or her performance as temporary operator. The temporary operator

shall be liable only in his or her capacity as temporary operator of the

program for injury to person and property by reason of his or her

operation of such program; he or she shall not have any liability in his

or her personal capacity, except for gross negligence and intentional

acts.

5. (a) The initial term of the appointment of the temporary operator

shall not exceed ninety days. After ninety days, if the commissioner

determines that termination of the temporary operator would cause

significant deterioration of the quality of, or access to, health care

in the community or that reappointment is necessary to correct the

deficiencies that required the appointment of the temporary operator,

the commissioner may authorize an additional ninety-day term. However,

such authorization shall include the commissioner's requirements for

conclusion of the temporary operatorship to be satisfied within the

additional term.

(b) Within fourteen days prior to the termination of each term of the

appointment of the temporary operator, the temporary operator shall

submit to the commissioner and to the established operator a report

describing:

(i) the actions taken during the appointment to address: the

identified program deficiencies; the resumption of program operations by

the established operator; or the transfer of the patients to other

OASAS-certified providers;

(ii) objectives for the continuation of the temporary operatorship if

necessary and a schedule for satisfaction of such objectives; and

(iii) if applicable, the recommended actions for the ongoing operation

of the program subsequent to the temporary operatorship.

(c) The term of the initial appointment and of any subsequent

reappointment may be terminated prior to the expiration of the

designated term, if the established operator and the commissioner agree

on a plan of correction and the implementation of such plan.

6. (a) The commissioner shall, upon making a determination of an

intention to appoint a temporary operator pursuant to paragraph (a) of

subdivision two of this section cause the established operator of the

facility to be notified of the intention by registered or certified mail

addressed to the principal office of the established operator. Such

notification shall include a detailed description of the findings

underlying the intention to appoint a temporary operator, and the date

and time of a required meeting with the commissioner and/or his or her

designee within ten business days of the receipt of such notice. At such

meeting, the established operator shall have the opportunity to review

and discuss all relevant findings. At such meeting, the commissioner and

the established operator shall attempt to develop a mutually

satisfactory plan of correction and schedule for implementation. In such

event, the commissioner shall notify the established operator that the

commissioner will abstain from appointing a temporary operator

contingent upon the established operator remediating the identified

deficiencies within the agreed upon timeframe.

(b) Should the commissioner and the established operator be unable to

establish a plan of correction pursuant to paragraph (a) of this

subdivision, or should the established operator fail to respond to the

commissioner's initial notification, there shall be an administrative

hearing on the commissioner's determination to appoint a temporary

operator to begin no later than thirty days from the date of the notice

to the established operator. Any such hearing shall be strictly limited

to the issue of whether the determination of the commissioner to appoint

a temporary operator is supported by substantial evidence. A copy of the

decision shall be sent to the established operator.

(c) If the decision to appoint a temporary operator is upheld such

temporary operator shall be appointed as soon as is practicable and

shall operate the program pursuant to the provisions of this section.

(d) Upon appointment of a temporary operator, the commissioner shall

cause the temporary president of the senate, the speaker of the

assembly, and the chairs of the senate and assembly committees on

alcoholism and drug abuse to be notified of such determination. Such

notification shall include, but not be limited to, the name of the

established operator, the name of the appointed temporary operator and a

description of the reasons for such determination to the extent

practicable under the circumstances and in the sole discretion of the

commissioner.

7. Notwithstanding the appointment of a temporary operator, the

established operator remains obligated for the continued operation of

the facility so that the program can function in a normal manner. No

provision contained in this section shall be deemed to relieve the

established operator or any other person of any civil or criminal

liability incurred, or any duty imposed by law, by reason of acts or

omissions of the established operator or any other person prior to the

appointment of any temporary operator of the program hereunder; nor

shall anything contained in this section be construed to suspend during

the term of the appointment of the temporary operator of the program any

obligation of the established operator or any other person for the

maintenance and repair of the facility, provision of utility services,

payment of taxes or other operating and maintenance expenses of the

facility, nor of the established operator or any other person for the

payment of mortgages or liens.