Bulletin: NY000476

When the federal government makes a grant, loan or guarantee for a hospital, medical facility, nursing home, health research facility, teaching facility for health related fields, facility for individuals with intellectual disabilities, medical or nursing school, federal law allows the United States government, in certain instances to recover such funds from the owner and subsequent purchasers of the facility.

The conditions for the recovery may relate to:

• The failure to complete facility improvements;
  
  
• The period of recovery (which will be ten years or twenty years after completion of the improvements);
  
  
• The failure of the facilities to be used for the purposes set forth in the particular law; and,
  
  
• The failure of the owner or transferee of the land to continue to qualify under the particular law.

Company Policy: When you issue an owner's or loan policy on a hospital, medical facility, or health research facility, you should determine whether the land is a "Hill-Burton Obligated Facility."

You can confirm this by calling the Department of Health and Human Services at 1-800-638-0742 or by reviewing the list of facilities on the internet at http://www.hrsa.gov/gethealthcare/affordable/hillburton/facilities.html/.

If the site is listed, add the following exception to your commitment and policy:

"Restrictions on the uses, occupancy and ownership of the Land as established under 42 U.S.C. § 291 et seq. or any similar laws, and rights of the United States pursuant thereto to recover its contribution to construction costs on violation."  

If the site is a nursing home, add the following exception to your commitment and policy: 

"Rights of residents of the facility on the Land pursuant to the terms of unrecorded residency agreements, if any." 

If you have any questions please contact Stewart Title Insurance Company Agency Legal Service at 212-922-0050.

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