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§27-41-18  Rehabilitation, liquidation, or conservation of health maintenance organization. –


Published: 2015

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TITLE 27

Insurance

CHAPTER 27-41

Health Maintenance Organizations

SECTION 27-41-18



   § 27-41-18  Rehabilitation, liquidation, or

conservation of health maintenance organization. –

(a) Any rehabilitation, liquidation, or conservation of a health maintenance

organization shall be deemed to be the rehabilitation, liquidation, or

conservation of an insurance company and shall be conducted under the

supervision of the director of business regulation pursuant to chapters 14.1,

14.2, and 14.3 of this title. The director of business regulation may apply for

an order from the superior court directing the director to rehabilitate,

liquidate, or conserve a health maintenance organization upon any one or more

of the grounds included in chapter 14.3 of this title or upon any one or more

of the following grounds:



   (1) That the health maintenance organization is insolvent;



   (2) That the health maintenance organization is in an unsound

financial condition;



   (3) That the health maintenance organization's business

policies are unsound or improper;



   (4) That the health maintenance organization's condition or

management is such as to render its further transaction of business hazardous

to the public or its enrollees;



   (5) That the health maintenance organization's funds, net

cash, or contingent assets are deficient; or



   (6) That the health maintenance organization is conducting

its business fraudulently or refuses or neglects to comply with the laws of

this state.



   (b) A claim by a health care provider who agrees not to

assert that claim against any enrollee of the health maintenance organization

for an uncovered expenditure has priority over other providers of services.



   (c) For purposes of determining the priority of distribution

of general assets, claims of enrollees and enrollees' beneficiaries shall have

the same priority as established in chapter 14.3 of this title for

policyholders and beneficiaries of insureds of insurance companies. If an

enrollee is liable to a provider for services provided pursuant to and covered

by the health benefit plan, that liability shall have the status of an enrollee

claim for distribution of general assets. A provider who is obligated by

statute or agreement to hold enrollees harmless from liability for services

provided pursuant to and covered by a health benefit plan shall have a priority

of distribution of the general assets immediately following that of enrollees

and enrollees' beneficiaries as described herein, and immediately preceding the

priority of distribution for priority Class 7 described in § 27-14.3-46.



History of Section.

(P.L. 1983, ch. 225, § 2; P.L. 1991, ch. 370, § 4; P.L. 2005, ch.

176, § 1.)