The Florida Senate

641.17  Short title.

641.18  Declaration of legislative intent, findings, and purposes.

641.19  Definitions.

641.201  Applicability of other laws.

641.2015  Incorporation required.

641.2017  Insurance business not authorized.

641.2018  Limited coverage for home health care authorized.

641.20185  High-deductible contracts for medical savings accounts.

641.21  Application for certificate.

641.215  Conditions precedent to issuance or maintenance of certificate of authority; effect of bankruptcy proceedings.

641.217  Minority recruitment and retention plans required.

641.22  Issuance of certificate of authority.

641.221  Continued eligibility for certificate of authority.

641.225  Surplus requirements.

641.227  Rehabilitation Administrative Expense Fund.

641.228  Florida Health Maintenance Organization Consumer Assistance Plan.

641.23  Revocation or cancellation of certificate of authority; suspension of enrollment of new subscribers; terms of suspension.

641.234  Administrative, provider, and management contracts.

641.2342  Contract providers.

641.25  Administrative penalty in lieu of suspension or revocation.

641.255  Acquisition, merger, or consolidation.

641.26  Annual report.

641.261  Other reporting requirements.

641.27  Examination by the department.

641.28  Civil remedy.

641.281  Injunction.

641.282  Payment of judgment by health maintenance organization.

641.284  Liquidation, rehabilitation, reorganization, and conservation; exclusive methods of remedy.

641.285  Insolvency protection.

641.286  Levy upon deposit limited.

641.29  Fees.

641.30  Construction and relationship to other laws.

641.3005  Application of ch. 85-177.

641.3007  Human immunodeficiency virus infection and acquired immune deficiency syndrome for contract purposes.

641.305  Language used in contracts and advertisements; translations.

641.309  Standards for marketing to persons eligible for Medicare.

641.31  Health maintenance contracts.

641.3101  Additional contract contents.

641.31015  Health maintenance organization or exclusive provider organization; disclosure of terms and conditions of plan.

641.3102  Restrictions upon expulsion or refusal to issue or renew contract.

641.3103  Charter, bylaw provisions.

641.3104  Execution of contracts.

641.3105  Validity of noncomplying contracts.

641.3106  Construction of contracts.

641.3107  Delivery of contract.

641.31071  Preexisting conditions.

641.31072  Special enrollment periods.

641.31073  Prohibiting discrimination against individual participants and beneficiaries based on health status.

641.31074  Guaranteed renewability of coverage.

641.3108  Notice of cancellation of contract.

641.31094  Nondiscrimination of coverage for certain surgical procedures involving bones or joints.

641.31095  Coverage for mammograms.

641.31096  Requirements with respect to breast cancer and routine followup care.

641.3111  Extension of benefits.

641.315  Provider contracts.

641.3155  Provider contracts; payment of claims.

641.316  Fiscal intermediary services.

641.32  Acceptable payments.

641.33  Certain words prohibited in name of organization.

641.35  Assets, liabilities, and investments.

641.36  Adoption of rules; penalty for violation.

641.365  Dividends.

641.37  Prohibited activities; penalties.

641.38  Operational health maintenance organizations; issuance of certificate.

641.385  Order to discontinue certain advertising.

641.386  Agent licensing and appointment required; exceptions.

641.3901  Unfair methods of competition and unfair or deceptive acts or practices prohibited.

641.3903  Unfair methods of competition and unfair or deceptive acts or practices defined.

641.3905  General powers and duties of the department.

641.3907  Defined unfair practices; hearings, witnesses, appearances, production of books, and service of process.

641.3909  Cease and desist and penalty orders.

641.3911  Appeals from the department.

641.3913  Penalty for violation of cease and desist orders.

641.3915  Health maintenance organization anti-fraud plans and investigative units.

641.3917  Civil liability.

641.3921  Conversion on termination of eligibility.

641.3922  Conversion contracts; conditions.

641.3923  Discrimination against providers prohibited.

641.17  Short title.--This part shall be known and may be cited as the "Health Maintenance Organization Act."

History.--s. 1, ch. 72-264; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 778, 804, 809(1st), ch. 82-243; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.18  Declaration of legislative intent, findings, and purposes.--

(1)  Faced with the continuation of mounting costs of health care, coupled with the state's interest in high-quality care, the Legislature has determined that there is a need to explore alternative methods for the delivery of health care services, with a view toward achieving greater efficiency and economy in providing these services.

(2)  Health maintenance organizations, consisting of prepaid health care plans, hereinafter referred to as "plans," are developing rapidly in many communities. Through these organizations, structured in various forms, health care services are provided directly to a group of people who make regular premium payments.

(3)  These plans, when properly operated, emphasize effective cost and quality controls.

(4)  It shall be the policy of this state to:

(a)  Eliminate legal barriers to the organization, promotion, and expansion of comprehensive prepaid health care plans.

(b)  Recognize that prepaid comprehensive health care plans shall be exempt from operation of the insurance laws of this state except in the manner and to the extent set forth in this part.

(c)  Ensure that comprehensive prepaid health care plans deliver high-quality health care.

(5)  Although it is the intent of this act to provide an opportunity for the development of health maintenance organizations, there is no intent to impair the present system for the delivery of health services.

(6)  The Legislature has determined that the operation of a health maintenance organization without a subsisting certificate of authority or the renewal, issuance, or delivery of a health maintenance contract without a subsisting certificate of authority constitutes a danger to the citizens of this state and exposes any subscriber to immediate and irreparable injury, loss, or damage.

History.--s. 2, ch. 72-264; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 779, 804, 809(1st), ch. 82-243; s. 5, ch. 85-177; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.19  Definitions.--As used in this part, the term:

(1)  "Affiliate" means any entity which exercises control over or is controlled by the health maintenance organization, directly or indirectly, through:

(a)  Equity ownership of voting securities;

(b)  Common managerial control; or

(c)  Collusive participation by the management of the health maintenance organization and affiliate in the management of the health maintenance organization or the affiliate.

(2)  "Agency" means the Agency for Health Care Administration.

(3)  "Capitation" means the fixed amount paid by an HMO to a health care provider under contract with the health maintenance organization in exchange for the rendering of covered medical services.

(4)  "Comprehensive health care services" means services, medical equipment, and supplies furnished by a provider, which may include, but which are not limited to, medical, surgical, and dental care; psychological, optometric, optic, chiropractic, podiatric, nursing, physical therapy, and pharmaceutical services; health education, preventive medical, rehabilitative, and home health services; inpatient and outpatient hospital services; extended care; nursing home care; convalescent institutional care; technical and professional clinical pathology laboratory services; laboratory and ambulance services; appliances, drugs, medicines, and supplies; and any other care, service, or treatment of disease, or correction of defects for human beings.

(5)  "Copayment" means a specific dollar amount, except as otherwise provided for by statute, that the subscriber must pay upon receipt of covered health care services. Copayments may not be established in an amount that will prevent a person from receiving a covered service or benefit as specified in the subscriber contract approved by the department.

(6)  "Department" means the Department of Insurance.

(7)  "Emergency medical condition" means:

(a)  A medical condition manifesting itself by acute symptoms of sufficient severity, which may include severe pain or other acute symptoms, such that the absence of immediate medical attention could reasonably be expected to result in any of the following:

1.  Serious jeopardy to the health of a patient, including a pregnant woman or a fetus.

2.  Serious impairment to bodily functions.

3.  Serious dysfunction of any bodily organ or part.

(b)  With respect to a pregnant woman:

1.  That there is inadequate time to effect safe transfer to another hospital prior to delivery;

2.  That a transfer may pose a threat to the health and safety of the patient or fetus; or

3.  That there is evidence of the onset and persistence of uterine contractions or rupture of the membranes.

(8)  "Emergency services and care" means medical screening, examination, and evaluation by a physician, or, to the extent permitted by applicable law, by other appropriate personnel under the supervision of a physician, to determine if an emergency medical condition exists and, if it does, the care, treatment, or surgery for a covered service by a physician necessary to relieve or eliminate the emergency medical condition, within the service capability of a hospital.

(9)  "Entity" means any legal entity with continuing existence, including, but not limited to, a corporation, association, trust, or partnership.

(10)  "Geographic area" means the county or counties, or any portion of a county or counties, within which the health maintenance organization provides or arranges for comprehensive health care services to be available to its subscribers.

(11)  "Guaranteeing organization" is an organization which is domiciled in the United States; which has authorized service of process against it; and which has appointed the Insurance Commissioner and Treasurer as its agent for service of process issuing upon any cause of action arising in this state, based upon any guarantee entered into under this part.

(12)  "Health maintenance contract" means any contract entered into by a health maintenance organization with a subscriber or group of subscribers to provide comprehensive health care services in exchange for a prepaid per capita or prepaid aggregate fixed sum.

(13)  "Health maintenance organization" means any organization authorized under this part which:

(a)  Provides emergency care, inpatient hospital services, physician care including care provided by physicians licensed under chapters 458, 459, 460, and 461, ambulatory diagnostic treatment, and preventive health care services;

(b)  Provides, either directly or through arrangements with other persons, health care services to persons enrolled with such organization, on a prepaid per capita or prepaid aggregate fixed-sum basis;

(c)  Provides, either directly or through arrangements with other persons, comprehensive health care services which subscribers are entitled to receive pursuant to a contract;

(d)  Provides physician services, by physicians licensed under chapters 458, 459, 460, and 461, directly through physicians who are either employees or partners of such organization or under arrangements with a physician or any group of physicians; and

(e)  If offering services through a managed care system, then the managed care system must be a system in which a primary physician licensed under chapter 458 or chapter 459 and chapters 460 and 461 is designated for each subscriber upon request of a subscriber requesting service by a physician licensed under any of those chapters, and is responsible for coordinating the health care of the subscriber of the respectively requested service and for referring the subscriber to other providers of the same discipline when necessary. Each female subscriber may select as her primary physician an obstetrician/gynecologist who has agreed to serve as a primary physician and is in the health maintenance organization's provider network.

(14)  "Insolvent" or "insolvency" means that all the statutory assets of the health maintenance organization, if made immediately available, would not be sufficient to discharge all of its liabilities or that the health maintenance organization is unable to pay its debts as they become due in the usual course of business. In the event that all the assets of the health maintenance organization, if made immediately available, would not be sufficient to discharge all of its liabilities, but the organization has a written guarantee of the type and subject to the same provisions as outlined in s. 641.225, the organization shall not be considered insolvent unless it is unable to pay its debts as they become due in the usual course of business.

(15)  "Provider" means any physician, hospital, or other institution, organization, or person that furnishes health care services and is licensed or otherwise authorized to practice in the state.

(16)  "Reporting period" means the annual accounting period or any part thereof or the fiscal year of the health maintenance organization.

(17)  "Statutory accounting principles" means generally accepted accounting principles, except as modified by this part.

(18)  "Subscriber" means an entity or individual who has contracted, or on whose behalf a contract has been entered into, with a health maintenance organization for health care services or other persons who also receive health care services as a result of the contract.

(19)  "Surplus" means total statutory assets in excess of total liabilities, except that assets pledged to secure debts not reflected on the books of the health maintenance organization shall not be included in surplus. Surplus includes capital stock, capital in excess of par, other contributed capital, retained earnings, and surplus notes.

(20)  "Surplus notes" means debt which has been guaranteed by the United States Government or its agencies, or debt which has been subordinated to all claims of subscribers and general creditors of the organization.

(21)  "Uncovered expenditures" means the cost of health care services that are covered by a health maintenance organization, for which a subscriber would also be liable in the event of the insolvency of the organization.

History.--s. 3, ch. 72-264; s. 1, ch. 76-33; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 780, 804, 809(1st), ch. 82-243; s. 1, ch. 83-198; s. 137, ch. 83-216; s. 2, ch. 84-313; s. 6, ch. 85-177; s. 1, ch. 87-236; s. 1, ch. 87-273; s. 2, ch. 88-126; s. 2, ch. 88-388; s. 2, ch. 89-357; s. 74, ch. 89-360; ss. 111, 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 2, ch. 95-281; s. 13, ch. 96-199; s. 3, ch. 96-223.

641.201  Applicability of other laws.--Except as provided in this part, health maintenance organizations shall be governed by the provisions of this part and part III of this chapter and shall be exempt from all other provisions of the Florida Insurance Code.

History.--ss. 25, 50, ch. 85-321; s. 3, ch. 87-236; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 40, ch. 95-211.

641.2015  Incorporation required.--On or after October 1, 1985, any entity that has not yet obtained a certificate of authority to operate a health maintenance organization in this state shall be incorporated or shall be a division of a corporation formed under the provisions of either chapter 607 or chapter 617 or shall be a public entity that is organized as a political subdivision. In the case of a division of a corporation, the financial requirements of this part shall apply to the entire corporation. Incorporation shall not be required of any entity which has already been issued an initial certificate of authority prior to this date and which is not a corporation on October 1, 1985, or which is incorporated in any other state on October 1, 1985; nor shall incorporation be required on renewal of any certificate of authority by such an organization or be required of a public entity that is organized as a political subdivision.

History.--ss. 7, 47, ch. 85-177; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 14, ch. 96-199.

641.2017  Insurance business not authorized.--Nothing in the Florida Insurance Code or this part shall be deemed to authorize any health maintenance organization to transact any insurance business other than that of health maintenance organization type insurance or otherwise to engage in any other type of insurance unless it is authorized under a certificate of authority issued by the department under the provisions of the Florida Insurance Code. However, a health maintenance organization may by contract:

(1)  Enter into arrangements whereby the expected cost of health care services provided directly or through arrangements with other persons by the health maintenance organization is self-funded by the person contracting with the health maintenance organization, but the health maintenance organization assumes the risks that costs will exceed that amount on a prepaid per capita or prepaid aggregate fixed-sum basis; or

(2)  Enter into arrangements whereby the cost of health care services provided directly or through arrangements with other persons by the health maintenance organization is self-funded by the person contracting with the health maintenance organization.

History.--ss. 26, 50, ch. 85-321; s. 9, ch. 90-248; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.2018  Limited coverage for home health care authorized.--

(1)  Notwithstanding other provisions of this chapter, a health maintenance organization may issue a contract that limits coverage to home health care services only. The organization and the contract shall be subject to all of the requirements of this part that do not require or otherwise apply to specific benefits other than home care services. To this extent, all of the requirements of this part apply to any organization or contract that limits coverage to home care services, except the requirements for providing comprehensive health care services as provided in ss. 641.19(4), (12), and (13), and 641.31(1), except ss. 641.31(9), (12), (17), (18), (19), (20), (21), and (24) and 641.31095.

(2)  Notwithstanding the other provisions of this chapter, a health maintenance organization may apply for and obtain a certificate of authority from the department pursuant to this part and a health care provider certificate pursuant to part III, which certificate limits the authority of the organization to the issuance of contracts that limit coverage to home health care services pursuant to subsection (1). In addition to all applicable requirements of this part, as specified in subsection (1), all of the requirements of part III apply to an organization applying for such a limited certificate, except to the extent that such requirements directly conflict with the limited nature of the coverage provided.

(3)  Any contract that limits coverage to home health care benefits as provided in this section must also meet all of the requirements of ss. 627.9403-627.9408 of the Long-Term Care Insurance Act, except s. 627.9407(3)(c), (d), and (9).

History.--s. 6, ch. 96-275; s. 51, ch. 99-3.

641.20185  High-deductible contracts for medical savings accounts.--Notwithstanding the provisions of this part and part III related to the requirement for providing comprehensive coverage, a health maintenance organization may offer a high-deductible contract to employers that establish medical savings accounts, as defined in s. 220(d) of the Internal Revenue Code.

History.--s. 22, ch. 97-179; s. 52, ch. 99-3.

641.21  Application for certificate.--

(1)  Before any entity may operate a health maintenance organization, it shall obtain a certificate of authority from the department. The department shall accept and shall begin its review of an application for a certificate of authority anytime after an organization has filed an application for a health care provider certificate pursuant to part III of this chapter. However, the department shall not issue a certificate of authority to any applicant which does not possess a valid health care provider certificate issued by the agency. Each application for a certificate shall be on such form as the department shall prescribe, shall be verified by the oath of two officers of the corporation and properly notarized, and shall be accompanied by the following:

(a)  A copy of the articles of incorporation and all amendments thereto;

(b)  A copy of the bylaws, rules and regulations, or similar form of document, if any, regulating the conduct of the affairs of the applicant;

(c)  A list of the names, addresses, and official capacities with the organization of the persons who are to be responsible for the conduct of the affairs of the health maintenance organization, including all officers, directors, and owners of in excess of 5 percent of the common stock of the corporation. Such persons shall fully disclose to the department and the directors of the health maintenance organization the extent and nature of any contracts or arrangements between them and the health maintenance organization, including any possible conflicts of interest;

(d)  A complete biographical statement on forms prescribed by the department, and an independent investigation report and fingerprints obtained pursuant to chapter 624, of all of the individuals referred to in paragraph (c);

(e)  A statement generally describing the health maintenance organization, its operations, and its grievance procedures;

(f)  Forms of all health maintenance contracts, certificates, and member handbooks the applicant proposes to offer the subscribers, showing the benefits to which they are entitled, together with a table of the rates charged, or proposed to be charged, for each form of such contract. A certified actuary shall:

1.  Certify that the rates are neither inadequate nor excessive nor unfairly discriminatory;

2.  Certify that the rates are appropriate for the classes of risks for which they have been computed; and

3.  File an adequate description of the rating methodology showing that such methodology follows consistent and equitable actuarial principles;

(g)  A statement describing with reasonable certainty the geographic area or areas to be served by the health maintenance organization;

(h)  As to any applicant whose business plan indicates that it will receive Medicaid funds, a list of all contracts and agreements and any information relative to any payment or agreement to pay, directly or indirectly, a consultant fee, a broker fee, a commission, or other fee or charge related in any way to the application for a certificate of authority or the issuance of a certificate of authority, including, but not limited to, the name of the person or entity paying the fee; the name of the person or entity receiving the fee; the date of payment; and a brief description of the work performed. The contract, agreement, and related information shall, if requested, be provided to the department.

(i)  An audited financial statement prepared on the basis of statutory accounting principles and certified by an independent certified public accountant, except that surplus notes acceptable to the department and meeting the requirements of this act shall be included in the calculation of surplus; and

(j)  Such additional reasonable data, financial statements, and other pertinent information as the department may require with respect to the determination that the applicant can provide the services to be offered.

(2)  After submission of the application for a certificate of authority, the entity may engage in initial group marketing activities solely with respect to employers, representatives of labor unions, professional associations, and trade associations, so long as it does not enter into, issue, deliver, or otherwise effectuate health maintenance contracts, effectuate or bind coverage or benefits, provide health care services, or collect premiums or charges until it has been issued a certificate of authority by the department. Any such activities, oral or written, shall include a statement that the entity does not possess a valid certificate of authority and cannot enter into health maintenance contracts until such time as it has been issued a certificate of authority by the department.

(3)  A comprehensive feasibility study, performed by a certified actuary in conjunction with a certified public accountant. The study shall be for the greater of 3 years or until the health maintenance organization has been projected to be profitable for 12 consecutive months. The study must show that the health maintenance organization would not, at the end of any month of the projection period, have less than the minimum surplus as required by s. 641.225.

History.--s. 5, ch. 72-264; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 782, 804, 809(1st), ch. 82-243; s. 2, ch. 83-198; s. 8, ch. 85-177; s. 4, ch. 87-236; s. 3, ch. 88-388; ss. 112, 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 41, ch. 95-211; s. 15, ch. 96-199.

641.215  Conditions precedent to issuance or maintenance of certificate of authority; effect of bankruptcy proceedings.--

(1)  As a condition precedent to the issuance or maintenance of a certificate of authority, a health maintenance organization insurer must file or have on file with the department:

(a)  An acknowledgment that a delinquency proceeding pursuant to part I of chapter 631 or supervision by the department pursuant to ss. 624.80-624.87 constitutes the sole and exclusive method for the liquidation, rehabilitation, reorganization, or conservation of a health maintenance organization.

(b)  A waiver of any right to file or be subject to a bankruptcy proceeding.

(2)  The commencement of a bankruptcy proceeding either by or against a health maintenance organization shall, by operation of law:

(a)  Terminate the health maintenance organization's certificate of authority.

(b)  Vest in the department for the use and benefit of the subscribers of the health maintenance organization the title to any deposits of the insurer held by the department.

If the proceeding is initiated by a party other than the health maintenance organization, the operation of subsection (2) shall be stayed for a period of 60 days following the date of commencement of the proceeding.

History.--ss. 113, 188, ch. 91-108; s. 4, ch. 91-429.

641.217  Minority recruitment and retention plans required.--

(1)  Any entity contracting with the Agency for Health Care Administration to provide health care services to Medicaid recipients or state employees on a prepaid or fixed-sum basis must submit to the Agency for Health Care Administration the entity's plan for recruitment and retention of health care practitioners who are minorities as defined in s. 288.703(3). The plan must demonstrate an ability to recruit and retain minorities which shall include, but is not limited to, the following efforts:

(a)  Establishing and maintaining contacts with various organizations representing the interests and concerns of minority constituencies to seek advice and assistance.

(b)  Identifying and recruiting at colleges and universities which primarily serve minority students.

(c)  Reviewing and analyzing the organization's workforce as to minority representation.

(d)  Other factors identified by the Agency for Health Care Administration by rule.

(2)  The Agency for Health Care Administration may not contract with such an entity until the agency has received and approved the entity's plan required in subsection (1). Failure to implement the plan as approved shall constitute grounds for the suspension or termination of the entity's contract with the agency.

History.--s. 16, ch. 96-199.

641.22  Issuance of certificate of authority.--The department shall issue a certificate of authority to any entity filing a completed application in conformity with s. 641.21, upon payment of the prescribed fees and upon the department's being satisfied that:

(1)  As a condition precedent to the issuance of any certificate, the entity has obtained a health care provider certificate from the Agency for Health Care Administration pursuant to part III of this chapter.

(2)  The health maintenance organization is actuarially sound.

(3)  The entity has met the applicable requirements specified in s. 641.225.

(4)  The procedures for offering comprehensive health care services and offering and terminating contracts to subscribers will not unfairly discriminate on the basis of age, sex, race, health, or economic status. However, this section does not prohibit reasonable underwriting classifications for the purposes of establishing contract rates, nor does it prohibit experience rating.

(5)  The entity furnishes evidence of adequate insurance coverage or an adequate plan for self-insurance to respond to claims for injuries arising out of the furnishing of comprehensive health care.

(6)  The ownership, control, and management of the entity is competent and trustworthy and possesses managerial experience that would make the proposed health maintenance organization operation beneficial to the subscribers. The department shall not grant or continue authority to transact the business of a health maintenance organization in this state at any time during which the department has good reason to believe that:

(a)  The ownership, control, or management of the organization includes any person:

1.  Who is incompetent or untrustworthy;

2.  Who is so lacking in health maintenance organization expertise as to make the operation of the health maintenance organization hazardous to potential and existing subscribers;

3.  Who is so lacking in health maintenance organization experience, ability, and standing as to jeopardize the reasonable promise of successful operation;

4.  Who is affiliated, directly or indirectly, through ownership, control, reinsurance transactions, or other business relations, with any person whose business operations are or have been marked by business practices or conduct that is to the detriment of the public, stockholders, investors, or creditors; or

5.  Whose business operations are or have been marked by business practices or conduct that is to the detriment of the public, stockholders, investors, or creditors;

(b)  Any person, including any stock subscriber, stockholder, or incorporator, who exercises or has the ability to exercise effective control of the organization, or who influences or has the ability to influence the transaction of the business of the health maintenance organization, does not possess the financial standing and business experience for the successful operation of the health maintenance organization;

(c)  Any person, including any stock subscriber, stockholder, or incorporator, who exercises or has the ability to exercise effective control of the organization, or who influences or has the ability to influence the transaction of the business of the health maintenance organization, has been found guilty of, or has pled guilty or no contest to, any felony or crime punishable by imprisonment of 1 year or more under the laws of the United States or any state thereof or under the laws of any other country, which involves moral turpitude, without regard to whether a judgment or conviction has been entered by the court having jurisdiction in such case. However, in the case of a health maintenance organization operating under a subsisting certificate of authority, the health maintenance organization shall remove any such person immediately upon discovery of the conditions set forth in this paragraph when applicable to such person or under the order of the department, and the failure to so act by the organization is grounds for revocation or suspension of the health maintenance organization's certificate of authority; or

(d)  Any person, including any stock subscriber, stockholder, or incorporator, who exercises or has the ability to exercise effective control of the organization, or who influences or has the ability to influence the transaction of the business of the health maintenance organization, is now or was in the past affiliated, directly or indirectly, through ownership interest of 10 percent or more, control, or reinsurance transactions, with any business, corporation, or other entity that has been found guilty of or has pleaded guilty or nolo contendere to any felony or crime punishable by imprisonment for 1 year or more under the laws of the United States, any state, or any other country, regardless of adjudication. In the case of a health maintenance organization operating under a subsisting certificate of authority, the health maintenance organization shall immediately remove such person or immediately notify the department of such person upon discovery of the conditions set forth in this paragraph, either when applicable to such person or upon order of the department. The failure to remove such person, provide such notice, or comply with such order constitutes grounds for suspension or revocation of the health maintenance organization's certificate of authority.

(7)  The entity has a blanket fidelity bond in the amount of $100,000, issued by a licensed insurance carrier in this state, that will reimburse the entity in the event that anyone handling the funds of the entity either misappropriates or absconds with the funds. All employees handling the funds shall be covered by the blanket fidelity bond. An agent licensed under the provisions of the Florida Insurance Code may either directly or indirectly represent the health maintenance organization in the solicitation, negotiation, effectuation, procurement, receipt, delivery, or forwarding of any health maintenance organization subscriber's contract or collect or forward any consideration paid by the subscriber to the health maintenance organization; and the licensed agent shall not be required to post the bond required by this subsection.

(8)  The entity has filed with the department, and obtained approval from the department of, all reinsurance contracts as provided in s. 641.285.

(9)  The health maintenance organization has a grievance procedure that will facilitate the resolution of subscriber grievances and that includes both formal and informal steps available within the organization.

History.--s. 6, ch. 72-264; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 783, 804, 809(1st), ch. 82-243; s. 3, ch. 83-198; s. 3, ch. 84-313; s. 9, ch. 85-177; s. 5, ch. 87-236; s. 4, ch. 88-388; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 42, ch. 95-211; s. 17, ch. 96-199; s. 21, ch. 97-93; s. 264, ch. 99-8.

641.221  Continued eligibility for certificate of authority.--In order to maintain its eligibility for a certificate of authority, a health maintenance organization shall continue to meet all conditions required to be met under this part and the rules promulgated thereunder for the initial application for and issuance of its certificate of authority under s. 641.22.

History.--ss. 10, 47, ch. 85-177; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.225  Surplus requirements.--

(1)  Each health maintenance organization shall at all times maintain a minimum surplus in an amount that is the greater of $1,500,000, or 10 percent of total liabilities, or 2 percent of total annualized premium. All health maintenance organizations that have a valid certificate of authority before October 1, 1998, or an entity described in subsection (3), and that do not meet the minimum surplus requirement, shall increase their surplus as follows:

(2)  The department shall not issue a certificate of authority, except as provided in subsection (3), unless the health maintenance organization has a minimum surplus in an amount which is the greater of:

(a)  Ten percent of their total liabilities based on their startup projection as set forth in this part;

(b)  Two percent of their total projected premiums based on their startup projection as set forth in this part; or

(c)  $1,500,000, plus all startup losses, excluding profits, projected to be incurred on their startup projection until the projection reflects statutory net profits for 12 consecutive months.

(3)(a)  An entity providing prepaid capitated services which is authorized under s. 409.912(3)(a) and which applies for a certificate of authority is subject to the minimum surplus requirements set forth in subsection (1), unless the entity is backed by the full faith and credit of the county in which it is located.

(b)  An entity providing prepaid capitated services which is authorized under s. 409.912(3)(b) or (c), and which applies for a certificate of authority is subject to the minimum surplus requirements set forth in s. 409.912.

(4)  The department may adopt rules to set uniform standards and criteria for the early warning that the continued operation of any health maintenance organization might be hazardous to its subscribers, creditors, or the general public, and to set standards for evaluating the financial condition of any health maintenance organization.

(5)  A surplus note shall not be used to initially capitalize a health maintenance organization.

(6)  In lieu of having any minimum surplus, the health maintenance organization may provide a written guarantee to assure payment of covered subscriber claims and all other liabilities of the health maintenance organization, provided that the written guarantee is made by a guaranteeing organization which:

(a)  Has been in operation for 5 years or more and has a surplus, not including land, buildings, and equipment, of the greater of $2 million or 2 times the minimum surplus requirements of the health maintenance organization. In any determination of the financial condition of the guaranteeing organization, the definitions of assets, liabilities, and surplus set forth in this part shall apply, except that investments in or loans to any organizations guaranteed by the guaranteeing organization shall be excluded from surplus. If the guaranteeing organization is sponsoring more than one organization, the surplus requirement shall be increased by a multiple equal to the number of such organizations.

(b)  Submits a guarantee that is approved by the department as meeting the requirements of this part, provided that the written guarantee contains a provision which requires that the guarantee be irrevocable unless the guaranteeing organization can demonstrate to the department that the cancellation of the guarantee will not result in the insolvency of the health maintenance organization and the department approves cancellation of the guarantee.

(c)  Initially submits its audited financial statements, certified by an independent certified public accountant, prepared in accordance with generally accepted accounting principles, covering its two most current annual accounting periods.

(d)  Submits annually, within 3 months after the end of its fiscal year, an audited financial statement certified by an independent certified public accountant, prepared in accordance with generally accepted accounting principles. The department may, as it deems necessary, require quarterly financial statements from the guaranteeing organization.

History.--s. 4, ch. 83-198; s. 4, ch. 84-313; s. 28, ch. 85-62; s. 11, ch. 85-177; s. 1, ch. 86-286; s. 5, ch. 88-388; s. 24, ch. 90-295; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 18, ch. 96-199; s. 20, ch. 98-159.

641.227  Rehabilitation Administrative Expense Fund.--

(1)  The department shall not issue or permit to exist a certificate of authority to operate a health maintenance organization in this state unless the organization has deposited with the department $10,000 in cash for use in the Rehabilitation Administrative Expense Fund as established in subsection (2).

(2)  The department shall maintain all deposits received under this section and all income from such deposits in trust in an account titled "Rehabilitation Administrative Expense Fund." The fund shall be administered by the department and shall be used for the purpose of payment of the administrative expenses of the department during any rehabilitation of a health maintenance organization, when rehabilitation is ordered by a court of competent jurisdiction.

(3)  Upon successful rehabilitation of a health maintenance organization, the organization shall reimburse the fund for the amount of expenses incurred by the department during the court-ordered rehabilitation period.

(4)  If a court of competent jurisdiction orders liquidation of a health maintenance organization, the fund shall be reimbursed for expenses incurred by the department as provided for in chapter 631.

(5)  Each deposit made under this section shall be allowed as an asset for purposes of determination of the financial condition of the health maintenance organization. The deposit shall be refunded to the organization only when the organization both ceases operation as a health maintenance organization and no longer holds a subsisting certificate of authority.

History.--ss. 12, 47, ch. 85-177; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.228  Florida Health Maintenance Organization Consumer Assistance Plan.--

(1)  The department shall not issue a certificate to any health maintenance organization after July 1, 1989, until the applicant health maintenance organization has paid in full its special assessment as set forth in s. 631.819(2)(a).

(2)  No assessment paid to the Florida Health Maintenance Organization Consumer Assistance Plan shall be allowed as an asset of any health maintenance organization.

(3)  The department may suspend or revoke the certificate of authority of any health maintenance organization which does not timely pay its assessment to the Florida Health Maintenance Organization Consumer Assistance Plan.

History.--ss. 6, 24, ch. 88-388; ss. 114, 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.23  Revocation or cancellation of certificate of authority; suspension of enrollment of new subscribers; terms of suspension.--

(1)  The maintenance of a valid and current health care provider certificate issued pursuant to part III of this chapter is a condition of the maintenance of a valid and current certificate of authority issued by the department to operate a health maintenance organization. Denial or revocation of a health care provider certificate shall be deemed to be an automatic and immediate cancellation of a health maintenance organization's certificate of authority. At the discretion of the Department of Insurance, nonrenewal of a health care provider certificate may be deemed to be an automatic and immediate cancellation of a health maintenance organization's certificate of authority if the Agency for Health Care Administration notifies the Department of Insurance, in writing, that the health care provider certificate will not be renewed.

(2)  The department may suspend the authority of a health maintenance organization to enroll new subscribers or revoke any certificate issued to a health maintenance organization, or order compliance within 30 days, if it finds that any of the following conditions exists:

(a)  The organization is not operating in compliance with this part;

(b)  The plan is no longer actuarially sound or the organization does not have the minimum surplus as required by this part;

(c)  The existing contract rates are excessive, inadequate, or unfairly discriminatory;

(d)  The organization has advertised, merchandised, or attempted to merchandise its services in such a manner as to misrepresent its services or capacity for service or has engaged in deceptive, misleading, or unfair practices with respect to advertising or merchandising; or

(e)  The organization is insolvent.

(3)  Whenever the financial condition of the health maintenance organization is such that, if not modified or corrected, its continued operation would result in impairment or insolvency, the department may order the health maintenance organization to file with the department and implement a corrective action plan designed to do one or more of the following:

(a)  Reduce the total amount of present potential liability for benefits by reinsurance or other means.

(b)  Reduce the volume of new business being accepted.

(c)  Reduce the expenses of the health maintenance organization by specified methods.

(d)  Suspend or limit the writing of new business for a period of time.

(e)  Require an increase in the health maintenance organization's net worth.

If the health maintenance organization fails to submit a plan within 30 days of the department's order or submits a plan which is insufficient to correct the health maintenance organization's financial condition, the department may order the health maintenance organization to implement one or more of the corrective actions listed in this subsection.

(4)  The department shall, in its order suspending the authority of a health maintenance organization to enroll new subscribers, specify the period during which the suspension is to be in effect and the conditions, if any, which must be met by the health maintenance organization prior to reinstatement of its authority to enroll new subscribers. The order of suspension is subject to rescission or modification by further order of the department prior to the expiration of the suspension period. Reinstatement shall not be made unless requested by the health maintenance organization; however, the department shall not grant reinstatement if it finds that the circumstances for which the suspension occurred still exist or are likely to recur.

(5)  The department shall promulgate rules establishing an actuarially sound medical loss ¹ratio for Medicaid. In determining the appropriate medical loss ratio, the department shall consider factors, including but not limited to, plan age, plan structure, geographic service area, product mix, provider network, medical inflation, provider services, other professional services, out of network referrals and expenditures, in and out of network emergency room expenditures, inpatient expenditures, other medical expenditures, incentive pool adjustments, copayments, coordination of benefits, subrogation, and any other expenses associated with the delivery of medical benefits. The department shall utilize assistance from the Agency for Health Care Administration, the State University System, an independent actuary, and representatives from health maintenance organizations in developing the rule for appropriate medical loss ratios.

(6)  The department shall calculate and publish at least annually the medical loss ratios of all licensed health maintenance organizations. The publication shall include an explanation of what the medical loss ratio means and shall disclose that the medical loss ratio is not a direct reflection of quality, but must be looked at along with patient satisfaction and other standards that define quality.

History.--s. 7, ch. 72-264; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 784, 804, 809(1st), ch. 82-243; s. 5, ch. 83-198; s. 6, ch. 84-313; s. 6, ch. 87-236; s. 7, ch. 88-388; ss. 115, 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 43, ch. 95-211; s. 19, ch. 96-199; s. 265, ch. 99-8.

¹Note.--The word "ratio" was substituted for the word "ratios" by the editors.

641.234  Administrative, provider, and management contracts.--

(1)  The department may require a health maintenance organization to submit any contract for administrative services, contract with a provider other than an individual physician, contract for management services, and contract with an affiliated entity to the department.

(2)  After review of a contract the department may order the health maintenance organization to cancel the contract in accordance with the terms of the contract and applicable law if it determines that the fees to be paid by the health maintenance organization under the contract are so unreasonably high as compared with similar contracts entered into by the health maintenance organization or as compared with similar contracts entered into by other health maintenance organizations in similar circumstances that the contract is detrimental to the subscribers, stockholders, investors, or creditors of the health maintenance organization.

(3)  All contracts for administrative services, management services, provider services other than individual physician contracts, and with affiliated entities entered into or renewed by a health maintenance organization on or after October 1, 1988, shall contain a provision that the contract shall be canceled upon issuance of an order by the department pursuant to this section.

History.--ss. 8, 24, ch. 88-388; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 20, ch. 96-199.

641.2342  Contract providers.--Each health maintenance organization shall file, upon the request of the department, financial statements for all contract providers of comprehensive health care services who have assumed, through capitation or other means, more than 10 percent of the health care risks of the health maintenance organization. However, this provision shall not apply to any individual physician.

History.--ss. 9, 24, ch. 88-388; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.25  Administrative penalty in lieu of suspension or revocation.--If the department finds that one or more grounds exist for the revocation or suspension of a certificate issued under this part, the department may, in lieu of revocation or suspension, impose a fine upon the health maintenance organization. With respect to any nonwillful violation, the fine must not exceed $2,500 per violation. Such fines may not exceed an aggregate amount of $25,000 for all nonwillful violations arising out of the same action. With respect to any knowing and willful violation of a lawful order or rule of the department or a provision of this part, the department may impose upon the organization a fine in an amount not to exceed $20,000 for each such violation. Such fines may not exceed an aggregate amount of $250,000 for all knowing and willful violations arising out of the same action. The department must adopt by rule by January 1, 1997, penalty categories that specify varying ranges of monetary fines for willful violations and for nonwillful violations.

History.--s. 9, ch. 72-264; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 21, ch. 78-95; ss. 2, 3, ch. 81-318; ss. 786, 804, 809(1st), ch. 82-243; s. 6, ch. 83-198; s. 7, ch. 87-236; s. 10, ch. 88-388; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 21, ch. 96-199.

641.255  Acquisition, merger, or consolidation.--

(1)  Every acquisition of a health maintenance organization shall be subject to the provisions of s. 628.4615. However, in the case of a health maintenance organization organized as a for-profit corporation, the provisions of s. 628.451 govern with respect to any merger or consolidation; and, in the case of a health maintenance organization organized as a not-for-profit corporation, the provisions of s. 628.471 govern with respect to any merger or consolidation.

(2)  In addition to the requirements set forth in ss. 628.451, 628.4615, and 628.471, each party to any transaction involving any licensee which, as indicated in its most recent quarterly or annual statement, derives income from Medicaid funds shall in the filing made with the department identify:

(a)  Any person who has received any payment from either party or any person on that party's behalf; or

(b)  The existence of any agreement entered into by either party or by any person on that party's behalf to pay a consultant fee, a broker fee, a commission, or other fee or charge,

which in any way relates to the acquisition, merger, or consolidation. The department may adopt a form to be made part of the application which is to be sworn to by an officer of the entity which made or will make the payment. The form shall include the name of the person or entity paying the fee; the name of the person or entity receiving the fee; the date of payment; and a brief description of the work performed.

History.--ss. 787, 809(1st), ch. 82-243; ss. 13, 17, ch. 86-250; s. 4, ch. 87-50; s. 10, ch. 90-248; ss. 184, 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 22, ch. 96-199.

641.26  Annual report.--

(1)  Every health maintenance organization shall, annually within 3 months after the end of its fiscal year, or within an extension of time therefor as the department, for good cause, may grant, in a form prescribed by the department, file a report with the department, verified by the oath of two officers of the organization or, if not a corporation, of two persons who are principal managing directors of the affairs of the organization, properly notarized, showing its condition on the last day of the immediately preceding reporting period. Such report shall include:

(a)  A financial statement of the health maintenance organization filed on a computer diskette using a format acceptable to the department.

(b)  A financial statement of the health maintenance organization filed on forms acceptable to the department.

(c)  An audited financial statement of the health maintenance organization, including its balance sheet and a statement of operations for the preceding year certified by an independent certified public accountant, prepared in accordance with statutory accounting principles.

(d)  The number of health maintenance contracts issued and outstanding and the number of health maintenance contracts terminated.

(e)  The number and amount of damage claims for medical injury initiated against the health maintenance organization and any of the providers engaged by it during the reporting year, broken down into claims with and without formal legal process, and the disposition, if any, of each such claim.

(f)  An actuarial certification that:

1.  The health maintenance organization is actuarially sound, which certification shall consider the rates, benefits, and expenses of, and any other funds available for the payment of obligations of, the organization.

2.  The rates being charged or to be charged are actuarially adequate to the end of the period for which rates have been guaranteed.

3.  Incurred but not reported claims and claims reported but not fully paid have been adequately provided for.

(g)  A report prepared by the certified public accountant and filed with the department describing material weaknesses in the health maintenance organization's internal control structure as noted by the certified public accountant during the audit. The report must be filed with the annual audited financial report as required in paragraph (c). The health maintenance organization shall provide a description of remedial actions taken or proposed to correct material weaknesses, if the actions are not described in the independent certified public accountant's report.

(h)  Such other information relating to the performance of health maintenance organizations as is required by the department.

(2)  The department may require updates of the actuarial certification as to a particular health maintenance organization if the department has reasonable cause to believe that such reserves are understated to the extent of materially misstating the financial position of the health maintenance organization. Workpapers in support of the statement of the updated actuarial certification must be provided to the department upon request.

(3)  Every health maintenance organization shall file quarterly, within 45 days after each of its quarterly reporting periods, an unaudited financial statement of the organization as described in paragraphs (1)(a) and (b). The quarterly report shall be verified by the oath of two officers of the organization, properly notarized.

(4)  Any health maintenance organization that neglects to file an annual report or quarterly report in the form and within the time required by this section shall forfeit up to $1,000 for each day for the first 10 days during which the neglect continues and shall forfeit up to $2,000 for each day after the first 10 days during which the neglect continues; and, upon notice by the department to that effect, the organization's authority to enroll new subscribers or to do business in this state shall cease while such default continues. The department shall deposit all sums collected by it under this section to the credit of the Insurance Commissioner's Regulatory Trust Fund. The department shall not collect more than $100,000 for each report.

(5)  Each authorized health maintenance organization shall retain an independent certified public accountant, referred to in this section as "CPA," who agrees by written contract with the health maintenance organization to comply with the provisions of this part.

(a)  The CPA shall provide to the HMO audited financial statements consistent with this part.

(b)  Any determination by the CPA that the health maintenance organization does not meet minimum surplus requirements as set forth in this part shall be stated by the CPA, in writing, in the audited financial statement.

(c)  The completed work papers and any written communications between the CPA firm and the health maintenance organization relating to the audit of the health maintenance organization shall be made available for review on a visual-inspection-only basis by the department at the offices of the health maintenance organization, at the department, or at any other reasonable place as mutually agreed between the department and the health maintenance organization. The CPA must retain for review the work papers and written communications for a period of not less than 6 years.

(d)  The CPA shall provide to the department a written report describing material weaknesses in the health maintenance organization's internal control structure as noted during the audit.

(6)  To facilitate uniformity in financial statements and to facilitate department analysis, the department may by rule adopt the form for financial statements of a health maintenance organization, including supplements as approved by the National Association of Insurance Commissioners in 1995, and may adopt subsequent amendments thereto if the methodology remains substantially consistent, and may by rule require each health maintenance organization to submit to the department all or part of the information contained in the annual statement in a computer-readable form compatible with the electronic data processing system specified by the department.

(7)  In addition to information called for and furnished in connection with its annual or quarterly statements, the health maintenance organization shall furnish to the department as soon as reasonably possible such information as to its material transactions which, in the department's opinion, may have a material adverse effect on the health maintenance organization's financial condition, as the department may request in writing. All such information furnished pursuant to the department's request must be verified by the oath of two executive officers of the health maintenance organization.

(8)  Each health maintenance organization shall file one copy of its annual statement convention blank in electronic form, along with such additional filings as prescribed by the department for the preceding year, with the National Association of Insurance Commissioners. Each health maintenance organization shall pay to the department a reasonable fee to cover costs associated with the filing and analysis of the documents by the National Association of Insurance Commissioners.

History.--s. 10, ch. 72-264; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 788, 804, 809(1st), ch. 82-243; s. 7, ch. 83-198; s. 13, ch. 85-177; s. 8, ch. 87-236; s. 11, ch. 88-388; s. 75, ch. 89-360; ss. 116, 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 23, ch. 96-199; s. 22, ch. 98-159.

641.261  Other reporting requirements.--

(1)  Each authorized health maintenance organization shall provide records and information to the Agency for Health Care Administration pursuant to s. 409.910(20) and (21) for the sole purpose of identifying potential coverage for claims filed with the agency and its fiscal agents for payment of medical services under the Medicaid program.

(2)  Any information provided by a health maintenance organization under this section to the agency shall not be considered a violation of any right of confidentiality or contract that the health maintenance organization may have with covered persons. The health maintenance organization is immune from any liability that it may otherwise incur through its release of information to the agency under this section.

History.--s. 6, ch. 87-377; s. 1, ch. 88-303; s. 8, ch. 90-232; s. 37, ch. 90-295; ss. 187, 188, ch. 91-108; s. 68, ch. 91-282; s. 4, ch. 91-429; s. 44, ch. 95-211; s. 266, ch. 99-8; s. 189, ch. 99-397.

641.27  Examination by the department.--

(1)  The department shall examine the affairs, transactions, accounts, business records, and assets of any health maintenance organization as often as it deems it expedient for the protection of the people of this state, but not less frequently than once every 3 years. In lieu of making its own financial examination, the department may accept an independent certified public accountant's audit report prepared on a statutory accounting basis consistent with this part. However, except when the medical records are requested and copies furnished pursuant to s. 455.667, medical records of individuals and records of physicians providing service under contract to the health maintenance organization shall not be subject to audit, although they may be subject to subpoena by court order upon a showing of good cause. For the purpose of examinations, the department may administer oaths to and examine the officers and agents of a health maintenance organization concerning its business and affairs. The examination of each health maintenance organization by the department shall be subject to the same terms and conditions as apply to insurers under chapter 624. In no event shall expenses of all examinations exceed a maximum of $20,000 for any 1-year period. Any rehabilitation, liquidation, conservation, or dissolution of a health maintenance organization shall be conducted under the supervision of the department, which shall have all power with respect thereto granted to it under the laws governing the rehabilitation, liquidation, reorganization, conservation, or dissolution of life insurance companies.

(2)  The department may contract, at reasonable fees for work performed, with qualified, impartial outside sources to perform audits or examinations or portions thereof pertaining to the qualification of an entity for issuance of a certificate of authority or to determine continued compliance with the requirements of this part. Any contracted assistance shall be under the direct supervision of the department. The results of any contracted assistance shall be subject to the review of, and approval, disapproval, or modification by, the department.

History.--s. 11, ch. 72-264; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 789, 804, 809(1st), ch. 82-243; s. 8, ch. 83-198; s. 14, ch. 85-177; s. 9, ch. 87-236; s. 12, ch. 88-388; ss. 117, 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 161, ch. 98-166.

641.28  Civil remedy.--In any civil action brought to enforce the terms and conditions of a health maintenance organization contract, the prevailing party is entitled to recover reasonable attorney's fees and court costs. This section shall not be construed to authorize a civil action against the department, its employees, or the Insurance Commissioner or against the Agency for Health Care Administration, its employees, or the director of the agency.

History.--s. 12, ch. 72-264; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 790, 804, 809(1st), ch. 82-243; s. 9, ch. 83-198; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 24, ch. 96-199.

641.281  Injunction.--In addition to the penalties and other enforcement provisions of this part, the department is vested with the power to seek both temporary and permanent injunctive relief when:

(1)  A health maintenance organization is being operated by any person or entity without a subsisting certificate of authority.

(2)  Any person, entity, or health maintenance organization has engaged in any activity prohibited by this part or any rule adopted pursuant thereto.

(3)  Any health maintenance organization, person, or entity is renewing, issuing, or delivering a health maintenance contract or contracts without a subsisting certificate of authority.

The department's authority to seek injunctive relief shall not be conditioned on having conducted any proceeding pursuant to chapter 120.

History.--ss. 15, 47, ch. 85-177; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.282  Payment of judgment by health maintenance organization.--Except as otherwise ordered by the court or mutually agreed upon by the parties, every judgment or decree entered in any of the courts of this state against any health maintenance organization for the recovery of money shall be fully satisfied within 60 days from and after the entry thereof or, in the case of an appeal from such judgment or decree, within 60 days from and after the affirmance of the same by the appellate court.

History.--ss. 16, 47, ch. 85-177; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.284  Liquidation, rehabilitation, reorganization, and conservation; exclusive methods of remedy.--A delinquency proceeding under part I of chapter 631 or supervision by the department under ss. 624.80-624.87 constitute the sole and exclusive means of liquidating, reorganizing, rehabilitating, or conserving a health maintenance organization.

History.--ss. 118, 188, ch. 91-108; s. 4, ch. 91-429.

641.285  Insolvency protection.--

(1)  Each health maintenance organization shall deposit with the department cash or securities of the type eligible under s. 625.52, which shall have at all times a market value in the amount set forth in this subsection. The amount of the deposit shall be reviewed annually, or more often, as the department deems necessary. The market value of the deposit shall be a minimum of $300,000.

(2)  If securities or assets deposited by a health maintenance organization under this part are subject to material fluctuations in market value, the department may, in its discretion, require the organization to deposit and maintain on deposit additional securities or assets in an amount as may be reasonably necessary to assure that the deposit will at all times have a market value of not less than the amount specified under this section. If for any reason the market value of assets and securities of a health maintenance organization held on deposit in this state under this code falls below the amount required, the organization shall promptly deposit other or additional assets or securities eligible for deposit sufficient to cure the deficiency. If the health maintenance organization has failed to cure the deficiency within 30 days after receipt of notice thereof by registered or certified mail from the department, the department may revoke the certificate of authority of the health maintenance organization.

(3)  Whenever the department determines that the financial condition of a health maintenance organization has deteriorated to the point that the policyholders' or subscribers' best interests are not being preserved by the activities of a health maintenance organization, the department may require such health maintenance organization to deposit and maintain deposited in trust with the department for the protection of the health maintenance organization's policyholders, subscribers, and creditors, for such time as the department deems necessary, securities eligible for such deposit under s. 625.52 having a market value of not less than the amount that the department determines is necessary, which amount must not be less than $100,000 or greater than $2 million. The deposit required under this subsection is in addition to any other deposits required of a health maintenance organization pursuant to subsections (1) and (2).

(4)  All income from deposits shall belong to the depositing health maintenance organization and shall be paid to it as it becomes available. A health maintenance organization that has made a securities deposit may withdraw that deposit, or any part thereof, after making a substitute deposit of cash or eligible securities or any combination of these or other acceptable measures of equal amount and value.

History.--ss. 791, 809(1st), ch. 82-243; s. 10, ch. 83-198; s. 17, ch. 85-177; ss. 184, 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 21, ch. 98-159.

641.286  Levy upon deposit limited.--No judgment creditor or other claimant of a health maintenance organization shall have the right to levy upon any of the assets or securities held in this state as a deposit under s. 641.285.

History.--ss. 18, 47, ch. 85-177; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.29  Fees.--Every health maintenance organization shall pay to the department the following fees:

(1)  For filing a copy of its application for a certificate of authority or amendment thereto, a nonrefundable fee in the amount of $1,000.

(2)  For filing each annual report, which must be filed on computer diskettes, $150.

History.--s. 13, ch. 72-264; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 792, 804, 809(1st), ch. 82-243; s. 19, ch. 85-177; s. 10, ch. 87-236; s. 13, ch. 88-388; ss. 119, 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.30  Construction and relationship to other laws.--

(1)  Every health maintenance organization shall accept the standard health claim form prescribed pursuant to s. 627.647.

(2)  Except as provided in this part, the Florida Insurance Code does not apply to health maintenance organizations certificated under this part, and health maintenance organizations certificated under this part are not subject to part II of this chapter. Any person, entity, or health maintenance organization operating without a subsisting certificate of authority in violation of this part or rules promulgated thereunder or renewing, issuing, or delivering health maintenance contracts without a subsisting certificate of authority in violation of this part or rules promulgated thereunder, in addition to being subject to the provisions of this part, is subject to the provisions of the Florida Insurance Code as defined in s. 624.01.

(3)  The solicitation of subscribers by a health maintenance organization or its representatives shall not be construed to be violative of any provisions of law relating to solicitation or advertising by health professionals if the health maintenance organization is operating pursuant to a subsisting certificate of authority.

(4)  The Division of Insurance Fraud of the department is vested with all powers granted to it under the Florida Insurance Code with respect to the investigation of any violation of this part.

(5)  Every health maintenance organization must comply with s. 627.4301.

History.--s. 14, ch. 72-264; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 793, 804, 809(1st), ch. 82-243; s. 7, ch. 84-313; s. 20, ch. 85-177; s. 11, ch. 87-236; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 5, ch. 97-182; s. 53, ch. 99-3.

641.3005  Application of ch. 85-177.--This act shall take effect October 1, 1985, and shall apply to all health maintenance organizations that have obtained certificates of authority before, on, or after this date, unless otherwise provided in this act. Any provision of this act necessitating a change in a health maintenance contract shall apply to contracts issued or renewed after October 1, 1985.

History.--s. 48, ch. 85-177; s. 1, ch. 86-286; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.3007  Human immunodeficiency virus infection and acquired immune deficiency syndrome for contract purposes.--

(1)  PURPOSE.--The purpose of this section is to prohibit unfair practices in a health maintenance organization contract with respect to exposure to the human immunodeficiency virus infection and related matters, and thereby reduce the possibility that a health maintenance organization subscriber or applicant may suffer unfair discrimination when subscribing to or applying for the contractual services of a health maintenance organization.

(2)  SCOPE.--This section applies to all health maintenance contracts which are issued in this state or which are issued outside this state but cover residents of this state. This section shall not prohibit a health maintenance organization from contesting a contract or claim to the extent allowed by law.

(3)  DEFINITIONS.--As used in this section:

(a)  "AIDS" means acquired immune deficiency syndrome.

(b)  "ARC" means AIDS-related complex.

(c)  "HIV" means human immunodeficiency virus identified as the causative agent of AIDS.

(4)  UTILIZATION OF MEDICAL TESTS.--

(a)  With respect to the issuance of or the underwriting of a health maintenance organization contract regarding exposure to the HIV infection and sickness or medical conditions derived from such infection, a health maintenance organization shall only utilize medical tests which are reliable predictors of risk. A test which is recommended by the Centers for Disease Control and Prevention or by the federal Food and Drug Administration is deemed to be reliable for the purposes of this section. A test which is rejected or not recommended by the Centers for Disease Control and Prevention or the federal Food and Drug Administration is a test which is deemed to be not reliable for the purposes of this section. If a specific Centers for Disease Control and Prevention or federal Food and Drug Administration recommended test indicates the existence or potential existence of exposure by the HIV infection or a sickness or medical condition related to the HIV infection, before relying on a single test result to deny or limit coverage or to rate the coverage, the health maintenance organization shall follow the applicable Centers for Disease Control and Prevention or federal Food and Drug Administration recommended test protocol and shall utilize any applicable Centers for Disease Control and Prevention or federal Food and Drug Administration recommended followup tests or series of tests to confirm the indication.

(b)  Prior to testing, the health maintenance organization must disclose its intent to test the person for the HIV infection or for a specific sickness or medical condition derived therefrom and must obtain the person's written informed consent to administer the test. Written informed consent shall include a fair explanation of the test, including its purpose, potential uses, and limitations, and the meaning of its results and the right to confidential treatment of information. Use of a form approved by the department shall raise a conclusive presumption of informed consent.

(c)  An applicant shall be notified of a positive test result by a physician designated by the applicant or, in the absence of such designation, by the Department of Health. Such notification must include:

1.  Face-to-face posttest counseling on the meaning of the test results; the possible need for additional testing; and the need to eliminate behavior which might spread the disease to others;

2.  The availability in the geographic area of any appropriate health care services, including mental health care, and appropriate social and support services;

3.  The benefits of locating and counseling any individual by whom the infected individual may have been exposed to human immunodeficiency virus and any individual whom the infected individual may have exposed to the virus; and

4.  The availability, if any, of the services of public health authorities with respect to locating and counseling any individual described in subparagraph 3.

(d)  A medical test for exposure to the HIV infection or for a sickness or medical condition derived from such infection shall only be required of or given to a person if the test is required or given to all subscribers or applicants or if the decision to require the test is based on the person's medical history. Sexual orientation shall not be used in the underwriting process or in the determination of which subscribers or applicants for enrollment shall be tested for exposure to the HIV infection. Neither the marital status, the living arrangements, the occupation, the gender, the beneficiary designation, nor the zip code or other territorial classification of an applicant shall be used to establish the applicant's sexual orientation.

(e)  A health maintenance organization may inquire whether a person has been tested positive for exposure to the HIV infection or been diagnosed as having AIDS or ARC caused by the HIV infection or other sickness or medical condition derived from such infection. A health maintenance organization shall not inquire whether a person has been tested for or has received a negative result from a specific test for exposure to the HIV infection or for a sickness or medical condition derived from such infection.

(f)  A health maintenance organization shall maintain strict confidentiality regarding medical test results with respect to the HIV infection or a specific sickness or medical condition derived from such infection. Information regarding specific test results shall not be disclosed outside the health maintenance organization, its employees, its marketing representatives, or its insurance affiliates, except to the person tested and to persons designated in writing by the person tested. Specific test results shall not be furnished to an insurance industry or health maintenance organization data bank if a review of the information would identify the individual and the specific test results.

(g)  No laboratory may be used by an insurer or insurance support organization for the processing of HIV-related tests unless it is certified by the United States Department of Health and Human Services under the Clinical Laboratories Improvement Act of 1967, permitting testing of specimens obtained in interstate commerce, and subjects itself to ongoing proficiency testing by the College of American Pathologists, the American Association of Bio Analysts, or an equivalent program approved by the Centers for Disease Control and Prevention of the United States Department of Health and Human Services.

(5)  RESTRICTIONS ON CONTRACT EXCLUSIONS AND LIMITATIONS.--

(a)  A health maintenance organization contract shall not exclude coverage of a member of a subscriber group because of a positive test result for exposure to the HIV infection or a specific sickness or medical condition derived from such infection, either as a condition for or subsequent to the issuance of the contract, provided that this prohibition shall not apply to persons applying for enrollment where individual underwriting is otherwise allowed by law.

(b)  No health maintenance organization contract shall exclude or limit coverage for exposure to the HIV infection or a specific sickness or medical condition derived from such infection, except as provided in a preexisting condition clause.

History.--ss. 51, 54, ch. 88-380; s. 188, ch. 91-108; s. 4, ch. 91-429; s. 45, ch. 95-211; s. 54, ch. 99-3; s. 267, ch. 99-8.

641.305  Language used in contracts and advertisements; translations.--

(1)(a)  All health maintenance contracts or forms shall be printed in English.

(b)  If the negotiations by a health maintenance organization with a member leading up to the effectuation of a health maintenance contract are conducted in a language other than English, the health maintenance organization shall supply to the member a written translation of the contract, which translation accurately reflects the substance of the contract and is in the language used to negotiate the contract. The written translation shall be affixed to and shall become a part of the contract or form. Any such translation shall be furnished to the department as part of the filing of the health maintenance contract form. No translation of a health maintenance contract form shall be approved by the department unless the translation accurately reflects the substance of the health maintenance contract form in translation.

(2)  The text of all advertisements by a health maintenance organization, if printed or broadcast in a language other than English, also shall be available in English and shall be furnished to the department upon request. As used in this subsection, the term "advertisement" means any advertisement, circular, pamphlet, brochure, or other printed material disclosing or disseminating advertising material or information by a health maintenance organization to prospective or existing subscribers and includes any radio or television transmittal of an advertisement or information.

History.--ss. 22, 47, ch. 85-177; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.309  Standards for marketing to persons eligible for Medicare.--

(1)  Every health maintenance organization marketing coverage to Medicare participants or persons eligible for Medicare in this state, directly or through its agents, shall:

(a)  Establish marketing procedures to assure that any comparison of benefits between Medicare or any other health maintenance organization offering such coverage by its agents will be fair and accurate.

(b)  Establish marketing procedures to assure proper notification to the Medicare participant of enrollment or disenrollment from the health maintenance organization. Such notification shall be made in a timely manner.

(c)  Display prominently by type, stamp, or other appropriate means, on the first page of the application and contract, the following:

"Notice to buyer: When you enroll in this health maintenance organization, you will be disenrolled from Medicare. The buyer should be aware that in order to receive payment or coverage for services such services must be rendered by physicians, hospitals, and other health care providers designated by the health maintenance organization. If the services are rendered by a nonparticipating physician, hospital, or other health care provider, the purchaser may be liable for payment for such services except in very limited circumstances."

(d)  Inquire and otherwise make every reasonable effort to identify whether a prospective Medicare participant has previously been enrolled in either the same health maintenance organization as a Medicare participant or in another health maintenance organization as a Medicare participant.

(2)  In addition to the practices prohibited in s. 641.3903:

(a)  No health maintenance organization or person representing such health maintenance organization shall employ any method of marketing having the effect of or tending to induce the purchase of health care plans through fraud, deceit, force, fright, threat whether explicit or implied, intimidation, harassment, or undue pressure to purchase or recommend the purchase of a health maintenance organization contract.

(b)  No participating provider, employee, or agent of such participating provider shall be an agent for or conduct any sales activities for a health maintenance organization with whom they have a provider contract.

History.--ss. 120, 188, ch. 91-108; s. 4, ch. 91-429.

¹641.31  Health maintenance contracts.--

(1)  Any entity issued a certificate and otherwise in compliance with this part may enter into contracts in this state to provide an agreed-upon set of comprehensive health care services to subscribers in exchange for a prepaid per capita sum or a prepaid aggregate fixed sum. Each subscriber shall be given a copy of the applicable health maintenance contract, certificate, or member handbook. Whichever document is provided to a subscriber shall contain all of the provisions and disclosures required by this section.

²(2)  The rates charged by any health maintenance organization to its subscribers shall not be excessive, inadequate, or unfairly discriminatory or follow a rating methodology that is inconsistent, indeterminate, or ambiguous or encourages misrepresentation or misunderstanding. The department, in accordance with generally accepted actuarial practice as applied to health maintenance organizations, may define by rule what constitutes excessive, inadequate, or unfairly discriminatory rates and may require whatever information it deems necessary to determine that a rate or proposed rate meets the requirements of this subsection.

²(3)(a)  If a health maintenance organization desires to amend any contract with its subscribers or any certificate or member handbook, or desires to change any basic health maintenance contract, certificate, grievance procedure, or member handbook form, or application form where written application is required and is to be made a part of the contract, or printed amendment, addendum, rider, or endorsement form or form of renewal certificate, it may do so, upon filing with the department the proposed change or amendment. Any proposed change shall be effective immediately, subject to disapproval by the department. Following receipt of notice of such disapproval or withdrawal of approval, no health maintenance organization shall issue or use any form disapproved by the department or as to which the department has withdrawn approval.

(b)  Any change in the rate is subject to paragraph (d) and requires at least 30 days' advance written notice to the subscriber. In the case of a group member, there may be a contractual agreement with the health maintenance organization to have the employer provide the required notice to the individual members of the group.

(c)  The department shall disapprove any form filed under this subsection, or withdraw any previous approval thereof, if the form:

1.  Is in any respect in violation of, or does not comply with, any provision of this part or rule adopted thereunder.

2.  Contains or incorporates by reference, where such incorporation is otherwise permissible, any inconsistent, ambiguous, or misleading clauses or exceptions and conditions which deceptively affect the risk purported to be assumed in the general coverage of the contract.

3.  Has any title, heading, or other indication of its provisions which is misleading.

4.  Is printed or otherwise reproduced in such a manner as to render any material provision of the form substantially illegible.

5.  Contains provisions which are unfair, inequitable, or contrary to the public policy of this state or which encourage misrepresentation.

6.  Excludes coverage for human immunodeficiency virus infection or acquired immune deficiency syndrome or contains limitations in the benefits payable, or in the terms or conditions of such contract, for human immunodeficiency virus infection or acquired immune deficiency syndrome which are different than those which apply to any other sickness or medical condition.

(d)  Any change in rates charged for the contract must be filed with the department not less than 30 days in advance of the effective date. At the expiration of such 30 days, the rate filing shall be deemed approved unless prior to such time the filing has been affirmatively approved or disapproved by order of the department. The approval of the filing by the department constitutes a waiver of any unexpired portion of such waiting period. The department may extend by not more than an additional 15 days the period within which it may so affirmatively approve or disapprove any such filing, by giving notice of such extension before expiration of the initial 30-day period. At the expiration of any such period as so extended, and in the absence of such prior affirmative approval or disapproval, any such filing shall be deemed approved.

(e)  It is not the intent of this subsection to restrict unduly the right to modify rates in the exercise of reasonable business judgment.

(4)  Every health maintenance contract, certificate, or member handbook shall clearly state all of the services to which a subscriber is entitled under the contract and must include a clear and understandable statement of any limitations on the services or kinds of services to be provided, including any copayment feature or schedule of benefits required by the contract or by any insurer or entity which is underwriting any of the services offered by the health maintenance organization. The contract, certificate, or member handbook shall also state where and in what manner the comprehensive health care services may be obtained.

(5)  Every subscriber shall receive a clear and understandable description of the method of the health maintenance organization for resolving subscriber grievances, and the method shall be set forth in the contract, certificate, and member handbook. The organization shall also furnish, at the time of initial enrollment and when necessary due to substantial changes to the grievance process a separate and additional communication prepared or approved by the department notifying the contract holder of a group contract or subscriber of an individual contract of their rights and responsibilities under the grievance process.

(6)  The rate of payment for a health maintenance contract shall be a part of the contract and shall be stated in individual contracts issued to subscribers.

(7)  A health maintenance organization is entitled to coordinate benefits on the same basis as an insurer under s. 627.4235.

(8)  A health maintenance organization providing medical benefits or payments to a subscriber who suffers injury, disease, or illness by virtue of the negligent act or omission of a third party is entitled to reimbursement from the subscriber in accordance with s. 768.76(4).

(9)  All health maintenance contracts that provide coverage, benefits, or services for a member of the family of the subscriber must, as to such family member's coverage, benefits, or services, provide also that the coverage, benefits, or services applicable for children must be provided with respect to a newborn child of the subscriber, or covered family member of the subscriber, from the moment of birth. However, with respect to a newborn child of a covered family member other than the spouse of the insured or subscriber, the coverage for the newborn child terminates 18 months after the birth of the newborn child. The coverage, benefits, or services for newborn children must consist of coverage for injury or sickness, including the necessary care or treatment of medically diagnosed congenital defects, birth abnormalities, or prematurity, and transportation costs of the newborn to and from the nearest appropriate facility appropriately staffed and equipped to treat the newborn's condition, when such transportation is certified by the attending physician as medically necessary to protect the health and safety of the newborn child.

(a)  A contract may require the subscriber to notify the plan of the birth of a child within a time period, as specified in the contract, of not less than 30 days after the birth, or a contract may require the preenrollment of a newborn prior to birth. However, if timely notice is given, a plan may not charge an additional premium for additional coverage of the newborn child for not less than 30 days after the birth of the child. If timely notice is not given, the plan may charge an additional premium from the date of birth. If notice is given within 60 days of the birth of the child, the contract may not deny coverage of the child due to failure of the subscriber to timely notify the plan of the birth of the child or to preenroll the child.

(b)  If the contract does not require the subscriber to notify the plan of the birth of a child within a specified time period, the plan may not deny coverage of the child nor may it retroactively charge the subscriber an additional premium for the child; however, the contract may prospectively charge the member an additional premium for the child if the plan provides at least 45 days' notice of the additional charge.

(10)  No alteration of any written application for any health maintenance contract shall be made by any person other than the applicant without his or her written consent, except that insertions may be made by the health maintenance organization, for administrative purposes only, in such manner as to indicate clearly that such insertions are not to be ascribed to the applicant.

(11)  No contract shall contain any waiver of rights or benefits provided to or available to subscribers under the provisions of any law or rule applicable to health maintenance organizations.

(12)  Each health maintenance contract, certificate, or member handbook shall state that emergency services and care shall be provided to subscribers in emergency situations not permitting treatment through the health maintenance organization's providers, without prior notification to and approval of the organization. Not less than 75 percent of the reasonable charges for covered services and supplies shall be paid by the organization, up to the subscriber contract benefit limits. Payment also may be subject to additional applicable copayment provisions, not to exceed $100 per claim. The health maintenance contract, certificate, or member handbook shall contain the definitions of "emergency services and care" and "emergency medical condition" as specified in s. 641.19(7) and (8), shall describe procedures for determination by the health maintenance organization of whether the services qualify for reimbursement as emergency services and care, and shall contain specific examples of what does constitute an emergency. In providing for emergency services and care as a covered service, a health maintenance organization shall be governed by s. 641.513.

(13)  In addition to the requirements of this section, with respect to a person who is entitled to have payments for health care costs made under Medicare, Title XVIII of the Social Security Act ("Medicare"), parts A and/or B:

(a)  The health maintenance organization shall mail or deliver notification to the Medicare beneficiary of the date of enrollment in the health maintenance organization within 10 days after receiving notification of enrollment approval from the United States Department of Health and Human Services, Health Care Financing Administration. When a Medicare beneficiary who is a subscriber of the health maintenance organization requests disenrollment from the organization, the organization shall mail or deliver to the beneficiary notice of the effective date of the disenrollment within 10 days after receipt of the written disenrollment request. The health maintenance organization shall forward the disenrollment request to the United States Department of Health and Human Services, Health Care Financing Administration, in a timely manner so as to effectuate the next available disenrollment date, as prescribed by such federal agency.

(b)  The health maintenance contract, certificate, or member handbook shall be delivered to the subscriber no later than the earlier of 10 working days after the health maintenance organization and the Health Care Financing Administration of the United States Department of Health and Human Services approve the subscriber's enrollment application or the effective date of coverage of the subscriber under the health maintenance contract. However, if notice from the Health Care Financing Administration of its approval of the subscriber's enrollment application is received by the health maintenance organization after the effective coverage date prescribed by the Health Care Financing Administration, the health maintenance organization shall deliver the contract, certificate, or member handbook to the subscriber within 10 days after receiving such notice. When a Medicare recipient is enrolled in a health maintenance organization program, the contract, certificate, or member handbook shall be accompanied by a health maintenance organization identification sticker with instruction to the Medicare beneficiary to place the sticker on the Medicare identification card.

(14)  Whenever a subscriber of a health maintenance organization is also a Medicaid recipient, the health maintenance organization's coverage shall be primary to the recipient's Medicaid benefits and the organization shall be a third party subject to the provisions of s. 409.910(4).

(15)(a)  All health maintenance contracts, certificates, and member handbooks shall contain the following provision:

"Grace Period: This contract has a (insert a number not less than 10) day grace period. This provision means that if any required premium is not paid on or before the date it is due, it may be paid during the following grace period. During the grace period, the contract will stay in force."

(b)  The required provision of paragraph (a) shall not apply to certificates or member handbooks delivered to individual subscribers under a group health maintenance contract when the employer or other person who will hold the contract on behalf of the subscriber group pays the entire premium for the individual subscribers. However, such required provision shall apply to the group health maintenance contract.

(16)  The contracts must clearly disclose the intent of the health maintenance organization as to the applicability or nonapplicability of coverage to preexisting conditions. If coverage of the contract is not to be applicable to preexisting conditions, the contract shall specify, in substance, that coverage pertains solely to accidental bodily injuries resulting from accidents occurring after the effective date of coverage and that sicknesses are limited to those which first manifest themselves subsequent to the effective date of coverage.

(17)  All health maintenance contracts that provide coverage for a member of the family of the subscriber, shall, as to such family member's coverage, provide that coverage, benefits, or services applicable for children shall be provided with respect to an adopted child of the subscriber, which child is placed in compliance with chapter 63, from the moment of placement in the residence of the subscriber. Such contracts may not exclude coverage for any preexisting condition of the child. In the case of a newborn child, coverage shall begin from the moment of birth if a written agreement to adopt such child has been entered into by the subscriber prior to the birth of the child, whether or not such agreement is enforceable. However, coverage for such child shall not be required in the event that the child is not ultimately placed in the residence of the subscriber in compliance with chapter 63.

(18)(a)  Health maintenance contracts that provide coverage, benefits, or services for maternity care must provide, as an option to the subscriber, the services of nurse-midwives and midwives licensed pursuant to chapter 467, and the services of birth centers licensed pursuant to ss. 383.30-383.335, if such services are available within the service area.

(b)  Any health maintenance contract that provides maternity or newborn coverage may not limit coverage for the length of a maternity or newborn stay in a hospital or for followup care outside of a hospital to any time period that is less than that determined to be medically necessary, in accordance with prevailing medical standards and consistent with guidelines for perinatal care of the American Academy of Pediatrics or the American College of Obstetricians and Gynecologists, by the treating obstetrical care provider or the pediatric care provider.

(c)  This section does not affect any agreement between a health maintenance organization and a hospital or other health care provider with respect to reimbursement for health care services provided, rate negotiations with providers, or capitation of providers, and this section does not prohibit appropriate utilization review or case management by a health maintenance organization.

(d)  Any health maintenance contract that provides coverage, benefits, or services for maternity or newborn care must provide coverage for postdelivery care for a mother and her newborn infant. The postdelivery care must include a postpartum assessment and newborn assessment and may be provided at the hospital, at the attending physician's office, at an outpatient maternity center, or in the home by a qualified licensed health care professional trained in mother and baby care. The services must include physical assessment of the newborn and mother, and the performance of any medically necessary clinical tests and immunizations in keeping with prevailing medical standards.

(e)  A health maintenance organization subject to paragraph (b) shall communicate active case questions and concerns regarding postdelivery care directly to the treating physician or hospital in written form, in addition to other forms of communication. Such organization shall also use a process that includes a written protocol for utilization review and quality assurance.

(f)  Any health maintenance organization subject to paragraph (b) may not:

1.  Deny to a mother or her newborn infant eligibility, or continued eligibility, to enroll or to renew coverage under the terms of the contract for the purpose of avoiding the requirements of this section.

2.  Provide monetary payments or rebates to a mother to encourage the mother to accept less than the minimum protections available under this section.

3.  Penalize or otherwise reduce or limit the reimbursement of an attending provider solely because the attending provider provided care to an individual participant or beneficiary in accordance with this section.

4.  Provide incentives, monetary or otherwise, to an attending provider solely to induce the provider to provide care to an individual participant or beneficiary in a manner inconsistent with this section.

5.  Subject to paragraph (i), restrict benefits for any portion of a period within a hospital length of stay required under paragraph (b) in a manner that is less favorable than the benefits provided for any preceding portion of such stay.

(g)  This subsection does not require a mother who is a participant or beneficiary to:

1.  Give birth in a hospital.

2.  Stay in the hospital for a fixed period of time following the birth of her infant.

(h)  This subsection does not apply with respect to any coverage offered by a health maintenance organization that does not provide benefits for hospital lengths of stay in connection with childbirth for a mother or her newborn infant.

(i)  This subsection does not prevent a health maintenance organization from imposing deductibles, coinsurance, or other cost sharing in relation to benefits for hospital lengths of stay in connection with childbirth for a mother or her newborn infant under the contract or under health insurance coverage offered in connection with a group health plan, except that such coinsurance or other cost sharing for any portion of a period within a hospital length of stay required under paragraph (b) may not be greater than such coinsurance or cost sharing for any preceding portion of such stay.

(19)  Notwithstanding any other provision of law, health maintenance policies or contracts which provide coverage, benefits, or services as described in s. 463.002(5), shall offer to the subscriber the services of an optometrist licensed pursuant to chapter 463.

(20)  Notwithstanding any other provision of law, health maintenance policies or contracts which provide coverage, benefits, or services which are performed by physicians who are ophthalmologists, licensed pursuant to chapter 458 or chapter 459, shall offer the subscriber the services of an ophthalmologist. For purposes of this subsection, ophthalmologists are physicians specializing in the diagnosis and treatment of diseases and injuries of the eye.

(21)  Notwithstanding any other provision of law, health maintenance policies or contracts which provide anesthesia coverage, benefits, or services shall offer to the subscriber, if requested and available, the services of a certified registered nurse anesthetist licensed pursuant to chapter 464.

(22)  Each health maintenance organization that offers a group plan within this state must have at least one open enrollment period of not less than 30 days every 18 months. Such open enrollment periods are required for as long as the group exists unless the health maintenance organization and the employer mutually agree to a shorter period of time than 18 months.

(23)  The contract shall include the following provision:

"Time limit on certain defenses: Relative to a misstatement in the application, after 2 years from the issue date, only fraudulent misstatements in the application may be used to void the policy or deny any claim for loss incurred or disability starting after the 2-year period."

(24)  Each health maintenance organization that provides for inpatient and outpatient services by allopathic hospitals shall provide as an option of the subscriber similar inpatient and outpatient services by hospitals accredited by the American Osteopathic Association when such services are available in the same service area of the HMO and the osteopathic hospital agrees to provide the services as specified herein. As a condition precedent to providing osteopathic inpatient and outpatient services through an osteopathic hospital that has not entered into a written contract with the HMO, the HMO may require the subscriber or any other person receiving osteopathic services to release the HMO from any liability arising from any act of omission or commission constituting malpractice in the delivery of osteopathic care from that hospital. The osteopathic hospital providing the inpatient and outpatient services for the HMO shall charge rates that do not exceed the osteopathic hospital's usual and customary rates less the average discount provided by allopathic hospitals providing the HMO services in the same service area of the HMO.

(25)  If a subscriber is a resident of a continuing care facility certified under chapter 651 or a retirement facility consisting of a nursing home and residential apartments, the subscriber's primary care physician must refer the subscriber to that facility's skilled nursing unit if the primary care physician finds that it is in the best interest of the patient to do so; if the facility agrees to be reimbursed at the health maintenance organization's contract rate negotiated with similar providers for the same services and supplies; and if the facility meets all guidelines established by the health maintenance organization related to quality of care, utilization, referral authorization, risk assumption, use of the health maintenance organization's network, and other criteria applicable to providers under contract for the same services and supplies.

(26)(a)  Each health maintenance organization and prepaid health plan shall provide coverage for all medically appropriate and necessary equipment, supplies, and services used to treat diabetes, including outpatient self-management training and educational services, if the patient's primary care physician, or the physician to whom the patient has been referred who specializes in treating diabetes, certifies that the equipment, supplies, or services are necessary.

(b)  The contract may require that diabetes outpatient self-management training and educational services be provided under the direct supervision of a certified diabetes educator or a board-certified endocrinologist under contract with or designated by the health maintenance organization or prepaid health plan.

(c)  The Agency for Health Care Administration shall adopt standards for outpatient self-management training and educational services, taking into consideration standards approved by the American Diabetes Association.

(27)  Any health maintenance contract that covers a resident of this state and that is issued, amended, delivered, or renewed in this state after October 1, 1996, must provide coverage for the medically necessary diagnosis and treatment of osteoporosis for high-risk individuals, including, but not limited to, estrogen-deficient individuals who are at clinical risk for osteoporosis, individuals who have vertebral abnormalities, individuals who are receiving long-term glucocorticoid (steroid) therapy, individuals who have primary hyperparathyroidism, and individuals who have a family history of osteoporosis. This subsection shall not apply to the state employee health insurance program.

(28)  A health maintenance organization may not discriminate against or fail to contract with a hospital, based solely on the fact that the hospital's medical staff is comprised of physicians licensed under chapter 459. Nothing in this subsection shall mandate that a health maintenance organization contract with a hospital.

(29)  If a health maintenance contract provides that coverage of a dependent child of the subscriber will terminate upon attainment of the limiting age for dependent children which is specified in the contract, the contract must also provide in substance that attainment of the limiting age does not terminate the coverage of the child while the child continues to be both:

(a)  Incapable of self-sustaining employment by reason of mental retardation or physical handicap, and

(b)  Chiefly dependent upon the employee or member for support and maintenance.

If the claim is denied under a contract for the stated reason that the child has attained the limiting age for dependent children specified in the contract, the notice or denial must state that the subscriber has the burden of establishing that the child continues to meet the criteria specified in paragraphs (a) and (b).

(30)(a)  All health maintenance contracts which provide coverage, benefits, or services for a member of the family of the subscriber must, as to such family member's coverage, benefits, or services, also provide that the benefits applicable for children include coverage for child health supervision services from the moment of birth to age 16 years.

(b)  As used in this subsection, the term "child health supervision services" means physician-delivered or physician-supervised services that include, at a minimum, services delivered at the intervals and scope stated in this subsection.

1.  Child health supervision services must include periodic visits which shall include a history, a physical examination, a developmental assessment and anticipatory guidance, and appropriate immunizations and laboratory tests. Such services and periodic visits shall be provided in accordance with prevailing medical standards consistent with the Recommendations for Preventive Pediatric Health Care of the American Academy of Pediatrics.

2.  Minimum benefits may be limited to one visit payable to one provider for all of the services provided at each visit cited in this subsection.

(31)(a)  Health maintenance contracts that provide coverage, benefits, or services for breast cancer treatment may not limit inpatient hospital coverage for mastectomies to any period that is less than that determined by the treating physician under contract with the health maintenance organization to be medically necessary in accordance with prevailing medical standards and after consultation with the covered patient. Such contract must also provide coverage for outpatient postsurgical followup care in keeping with prevailing medical standards by a licensed health care professional under contract with the health maintenance organization qualified to provide postsurgical mastectomy care. The treating physician under contract with the health maintenance organization, after consultation with the covered patient, may choose that the outpatient care be provided at the most medically appropriate setting, which may include the hospital, treating physician's office, outpatient center, or home of the covered patient.

(b)  A health maintenance organization subject to this subsection may not:

1.  Deny to a covered person eligibility, or continued eligibility, to enroll or to renew coverage under the terms of the contract for the purpose of avoiding the requirements of this subsection;

2.  Provide monetary payments or rebates to a covered patient to accept less than the minimum protections available under this subsection;

3.  Penalize or otherwise reduce or limit the reimbursement of an attending provider solely because the attending provider provided care to a covered patient under this subsection;

4.  Provide incentives, monetary or otherwise, to an attending provider solely to induce the provider to provide care to a covered patient in a manner inconsistent with this subsection; or

5.  Subject to the other provisions of this subsection, restrict benefits for any portion of a period within a hospital length of stay or outpatient care as required by this subsection in a manner that is less than favorable than the benefits provided for any preceding portion of such stay.

(c)1.  This subsection does not require a covered patient to have the mastectomy in the hospital or stay in the hospital for a fixed period of time following the mastectomy.

2.  This subsection does not prevent a contract from imposing deductibles, coinsurance, or other cost sharing in relation to benefits pursuant to this subsection, except that such cost sharing shall not exceed cost sharing with other benefits.

(d)  Except as provided in paragraph (b), this subsection does not affect any agreement between a health maintenance organization and a hospital or other health care provider with respect to reimbursement for health care services provided, rate negotiations with providers, or capitation of providers, and does not prohibit appropriate utilization review or case management by the health maintenance organization.

(e)  As used in this subsection, the term "mastectomy" means the removal of all or part of the breast for medically necessary reasons as determined by a licensed physician.

(32)  A health maintenance contract that provides coverage for mastectomies must also provide coverage for prosthetic devices and breast reconstructive surgery incident to the mastectomy. As used in this subsection, the term "breast reconstructive surgery" means surgery to reestablish symmetry between the two breasts. Such surgery must be in a manner chosen by the treating physician under contract with the health maintenance organization, consistent with prevailing medical standards, and in consultation with the patient. The health maintenance organization may charge an appropriate additional premium for the coverage required by this subsection. The coverage for prosthetic devices and breast reconstructive surgery shall be subject to any deductible and coinsurance conditions.

(33)  Notwithstanding any provision of this section to the contrary, a health maintenance organization which offers dermatological services shall provide direct patient access, for office visits and minor procedures and testing, to a dermatologist who is under contract with the health maintenance organization. The term "direct patient access" means the ability of a subscriber to obtain such services without a referral or other authorization before receiving services. The health maintenance organization shall, by July 1, 1997, develop criteria for compliance with the provisions of this subsection which do not impede or inhibit access to dermatological services for policyholders of the health maintenance organization. The criteria may include a maximum of five office visits to a dermatologist without prior authorization for a dermatologic problem within a 12-month period.

³(34)  For purposes of this subsection, dental treatment or surgery shall be considered necessary when the dental condition is likely to result in a medical condition if left untreated. Any health maintenance organization contract which provides coverage for general anesthesia and hospitalization services to a covered person shall not preclude such coverage in assuring the safe delivery of necessary dental care provided to a covered person who:

(a)  Is under 8 years of age and is determined by a licensed dentist, and the child's physician licensed under chapter 458 or chapter 459, to require necessary dental treatment in a hospital or ambulatory surgical center due to a significantly complex dental condition or a developmental disability in which patient management in the dental office has proved to be ineffective; or

(b)  Has one or more medical conditions that would create significant or undue medical risk for the individual in the course of delivery of any necessary dental treatment or surgery if not rendered in a hospital or ambulatory surgical center.

As provided herein, all terms and conditions of the covered person's health maintenance organization contract shall apply to such services, and this section does not require coverage for the diagnosis or treatment of dental disease. A health maintenance organization may require prior authorization for general anesthesia and hospital services required under this section in the same manner the organization requires prior authorization for hospitalization for other covered services. This subsection shall not apply to Medicare supplement, long-term care, disability, limited benefit, accident only, or specified disease policies.

(35)  A health maintenance contract that covers a child under the age of 18 must provide coverage for treatment of cleft lip and cleft palate for the child. The coverage must include medical, dental, speech therapy, audiology, and nutrition services only if such services are prescribed by the primary care physician or physician to whom the child is referred and such physician certifies that such services are medically necessary and consequent to treatment of the cleft lip or cleft palate. The coverage required by this section is subject to terms and conditions applicable to other benefits.

⁴(36)  A health maintenance organization may increase the copayment for any benefit, or delete, amend, or limit any of the benefits to which a subscriber is entitled under the group contract only, upon written notice to the contract holder at least 45 days in advance of the time of coverage renewal. The health maintenance organization may amend the contract with the contract holder, with such amendment to be effective immediately at the time of coverage renewal. The written notice to the contract holder shall specifically identify any deletions, amendments, or limitations to any of the benefits provided in the group contract during the current contract period which will be included in the group contract upon renewal. This subsection does not apply to any increases in benefits. The 45-day notice requirement shall not apply if benefits are amended, deleted, or limited at the request of the contract holder.

⁴(37)  All health maintenance contracts that provide coverage for massage must also cover the services of persons licensed to practice massage pursuant to chapter 480 if the massage is prescribed by a contracted physician licensed under chapter 458, chapter 459, chapter 460, or chapter 461 as medically necessary and the prescription specifies the number of treatments. Such massage services are subject to the same terms, conditions, and limitations as those of other covered services.

(38)(a)  Notwithstanding any other provision of this part, a health maintenance organization that meets the requirements of paragraph (b) may, through a point-of-service rider to its contract providing comprehensive health care services, include a point-of-service benefit. Under such a rider, a subscriber or other covered person of the health maintenance organization may choose, at the time of covered service, a provider with whom the health maintenance organization does not have a health maintenance organization provider contract. The rider may not require a referral from the health maintenance organization for the point-of-service benefits.

(b)  A health maintenance organization offering a point-of-service rider under this subsection must have a valid certificate of authority issued under the provisions of the chapter, must have been licensed under this chapter for a minimum of 3 years, and must at all times that it has riders in effect maintain a minimum surplus of $5 million.

(c)  Premiums paid in for the point-of-service riders may not exceed 15 percent of total premiums for all health plan products sold by the health maintenance organization offering the rider. If the premiums paid for point-of-service riders exceed 15 percent, the health maintenance organization must notify the department and, once this fact is known, must immediately cease offering such a rider until it is in compliance with the rider premium cap.

(d)  Notwithstanding the limitations of deductibles and copayment provisions in this part, a point-of-service rider may require the subscriber to pay a reasonable copayment for each visit for services provided by a noncontracted provider chosen at the time of the service. The copayment by the subscriber may either be a specific dollar amount or a percentage of the reimbursable provider charges covered by the contract and must be paid by the subscriber to the noncontracted provider upon receipt of covered services. The point-of-service rider may require that a reasonable annual deductible for the expenses associated with the point-of-service rider be met and may include a lifetime maximum benefit amount. The rider must include the language required by s. 627.6044 and must comply with copayment limits described in s. 627.6471. Section 641.315(2) and (3) does not apply to a point-of-service rider authorized under this subsection.

(e)  The term "point of service" may not be used by a health maintenance organization except with riders permitted under this section or with forms approved by the department in which a point-of-service product is offered with an indemnity carrier.

(f)  A point-of-service rider must be filed and approved under ss. 627.410 and 627.411.

History.--s. 15, ch. 72-264; s. 3, ch. 76-168; s. 1, ch. 77-457; s. 21, ch. 78-95; ss. 2, 3, ch. 81-318; ss. 794, 804, 809(1st), ch. 82-243; s. 11, ch. 83-198; s. 9, ch. 84-313; s. 21, ch. 85-177; ss. 2, 11, ch. 87-236; s. 2, ch. 87-273; s. 3, ch. 88-269; s. 52, ch. 88-380; s. 14, ch. 88-388; s. 4, ch. 89-190; s. 1, ch. 89-357; s. 9, ch. 90-232; s. 38, ch. 90-295; ss. 121, 187, 188, ch. 91-108; s. 61, ch. 91-110; s. 3, ch. 91-185; s. 69, ch. 91-282; s. 4, ch. 91-429; s. 2, ch. 93-245; s. 27, ch. 95-418; s. 3, ch. 96-195; s. 25, ch. 96-199; ss. 3, 5, ch. 96-279; s. 4, ch. 96-282; s. 12, ch. 97-48; s. 1752, ch. 97-102; s. 4, ch. 97-166; s. 2, ch. 97-171; s. 23, ch. 97-179; s. 5, ch. 98-66; s. 23, ch. 98-159; s. 4, ch. 98-312; s. 5, ch. 99-264; s. 3, ch. 99-275; s. 4, ch. 99-393.

¹Note.--

A.  Section 6, ch. 98-66, provides that "[p]ursuant to Section 18, Article VII of the State Constitution, the Legislature determines that this act fulfills an important state interest."

B.  Section 7, ch. 98-66, provides that "[t]his act shall take effect October 1, 1998, and shall apply to policies and contracts issued or renewed on or after that date."

C.  Section 5, ch. 98-312, provides that "[t]he provisions of this act fulfill an important state interest in that they promote the relief, alleviation, and prevention of health, dental, or medical problems associated with inadequate dental care."

²Note.--

A.  Section 5, ch. 99-264, provides that the amendment to subsections (2) and (3) by that section is "[e]ffective July 1, 1999, and applicable to policies and contracts issued or renewed on or after that date."

B.  Section 6, ch. 99-264, provides that "[t]his act shall take effect [June 8, 1999] and shall apply only to contracts entered into after the effective date."

³Note.--Section 6, ch. 98-312, provides that "[t]his act shall take effect October 1 of [1998] and shall apply to any policy issued, written, or renewed, or contract entered into, on or after such date."

⁴Note.--Section 10, ch. 99-275, provides that "[t]his act shall take effect July 1, 1999, and shall apply to all contracts renewed or entered into on or after that date."

641.3101  Additional contract contents.--A health maintenance contract may contain additional provisions not inconsistent with this part which are:

(1)  Necessary, on account of the manner in which the organization is constituted or operated, in order to state the rights and obligations of the parties to the contract; or

(2)  Desired by the organization and neither prohibited by law nor in conflict with any provisions required to be included therein.

History.--ss. 23, 47, ch. 85-177; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

¹641.31015  Health maintenance organization or exclusive provider organization; disclosure of terms and conditions of plan.--Each health maintenance organization or exclusive provider organization shall provide prospective enrollees with written information about the terms and conditions of the plan in accordance with s. 641.31(4) so that the prospective enrollees can make informed decisions about accepting a managed-care system of health care delivery; however, information about where, in what manner, and from whom the comprehensive health care services or specific health care services can be obtained need be disclosed only upon request by the prospective enrollee. All marketing materials distributed by the health maintenance organization or exclusive provider organization must contain a notice in boldfaced type which states that the information required under this section is available to the prospective enrollee upon request.

History.--s. 8, ch. 96-223.

¹Note.--Also published at s. 627.64725.

641.3102  Restrictions upon expulsion or refusal to issue or renew contract.--

(1)  A health maintenance organization that offers individual health maintenance contracts in this state may not decline to offer coverage to an eligible individual as required in s. 627.6487.

(2)  A health maintenance organization shall not expel or refuse to renew the coverage of, or refuse to enroll, any individual member of a subscriber group on the basis of the race, color, creed, marital status, sex, or national origin of the subscriber or individual. A health maintenance organization shall not expel or refuse to renew the coverage of any individual member of a subscriber group on the basis of the age, health status, health care needs, or prospective costs of health care services of the subscriber or individual. Nothing in this section shall prohibit a health maintenance organization from requiring that, as a condition of continued eligibility for membership, dependents of a subscriber, upon reaching a specified age, convert to a converted contract or that individuals entitled to have payments for health costs made under Title XVIII of the United States Social Security Act, as amended, be issued a health maintenance contract for Medicare beneficiaries so long as the health maintenance organization is authorized to issue health maintenance contracts for Medicare beneficiaries.

History.--ss. 24, 47, ch. 85-177; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 24, ch. 97-179.

641.3103  Charter, bylaw provisions.--No health maintenance contract shall contain any provision purporting to make any portion of the articles of incorporation, charter, bylaws, or other organizational document of the health maintenance organization a part of the contract unless the provision is set forth in full in the contract. Any contract provision in violation of this section is invalid, unless the provision operates to the benefit of the subscriber.

History.--ss. 25, 47, ch. 85-177; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.3104  Execution of contracts.--

(1)  Every health maintenance contract shall be executed in the name of and on behalf of the health maintenance organization by its officer, attorney in fact, employee, or representative duly authorized by the organization.

(2)  A facsimile signature of any executing individual may be used in lieu of an original signature.

(3)  No health maintenance contract which is otherwise valid shall be rendered invalid by reason of the apparent execution thereof on behalf of the health maintenance organization by the imprinted facsimile signature of an individual not authorized so to execute as of the date of the contract.

History.--ss. 26, 47, ch. 85-177; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.3105  Validity of noncomplying contracts.--

(1)  Any health maintenance contract, rider, endorsement, attachment, or addendum otherwise valid which contains any condition or provision not in compliance with the requirements of this part shall not be thereby rendered invalid, but shall be construed and applied in accordance with such conditions and provisions as would have applied had such contract, rider, endorsement, attachment, or addendum been in full compliance with this part. In the event an organization issues or delivers any contract for an amount which exceeds any limitations otherwise provided in this part, such organization shall be liable to the subscriber or her or his beneficiary for the full amount stated in the contract in addition to any other penalties that may be imposed under this part.

(2)  Any health maintenance contract delivered or issued for delivery in this state covering a subscriber, which subscriber, pursuant to the provisions of this part, the organization may not lawfully cover under the contract, shall be cancelable at any time by the organization, any provision of the contract to the contrary notwithstanding; and the organization shall promptly cancel the contract in accordance with the request of the department therefor. No such illegality or cancellation shall be deemed to relieve the organization of any liability incurred by it under the contract while in force or to prohibit the organization from retaining the pro rata earned premium or rate thereon. This provision does not relieve the organization from any penalty otherwise incurred by the organization under this part on account of any such violation.

History.--ss. 27, 47, ch. 85-177; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 489, ch. 97-102.

641.3106  Construction of contracts.--Every health maintenance contract shall be construed according to the entirety of its terms and conditions as set forth in the contract and as amplified, extended, or modified by any application therefor or any rider, endorsement, attachment, or addendum thereto.

History.--ss. 28, 47, ch. 85-177; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.3107  Delivery of contract.--Unless delivered upon execution or issuance, a health maintenance contract, certificate of coverage, or member handbook shall be mailed or delivered to the subscriber or, in the case of a group health maintenance contract, to the employer or other person who will hold the contract on behalf of the subscriber group within 10 working days from approval of the enrollment form by the health maintenance organization or by the effective date of coverage, whichever occurs first. However, if the employer or other person who will hold the contract on behalf of the subscriber group requires retroactive enrollment of a subscriber, the organization shall deliver the contract, certificate, or member handbook to the subscriber within 10 days after receiving notice from the employer of the retroactive enrollment. This section does not apply to the delivery of those contracts specified in s. 641.31(13).

History.--ss. 29, 47, ch. 85-177; ss. 187, 188, ch. 91-108; s. 10, ch. 91-110; s. 4, ch. 91-429.

¹641.31071  Preexisting conditions.--

(1)  As used in this section, the term:

(a)  "Enrollment date" means, with respect to an individual covered under a group health maintenance organization contract, the date of enrollment of the individual in the plan or coverage or, if earlier, the first day of the waiting period of such enrollment.

(b)  "Late enrollee" means, with respect to coverage under a group health maintenance organization contract, a participant or beneficiary who enrolls under the contract other than during:

1.  The first period in which the individual is eligible to enroll under the plan.

2.  A special enrollment period, as provided under s. 641.31072.

(c)  "Waiting period" means, with respect to a group health maintenance organization contract and an individual who is a potential participant or beneficiary under the contract, the period that must pass with respect to the individual before the individual is eligible to be covered for benefits under the terms of the contract.

(2)  Subject to the exceptions specified in subsection (4), a health maintenance organization that offers group coverage, may, with respect to a participant or beneficiary, impose a preexisting condition exclusion only if:

(a)  Such exclusion relates to a physical or mental condition, regardless of the cause of the condition, for which medical advice, diagnosis, care, or treatment was recommended or received within the 6-month period ending on the enrollment date;

(b)  Such exclusion extends for a period of not more than 12 months, or 18 months in the case of a late enrollee, after the enrollment date; and

(c)  The period of any such preexisting condition exclusion is reduced by the aggregate of the periods of creditable coverage, as defined in subsection (5), applicable to the participant or beneficiary as of the enrollment date.

(3)  Genetic information shall not be treated as a condition described in paragraph (2)(a) in the absence of a diagnosis of the condition related to such information.

(4)(a)  Subject to paragraph (b), a health maintenance organization that offers group coverage may not impose any preexisting condition exclusion in the case of:

1.  An individual who, as of the last day of the 30-day period beginning with the date of birth, is covered under creditable coverage.

2.  A child who is adopted or placed for adoption before attaining 18 years of age and who, as of the last day of the 30-day period beginning on the date of the adoption or placement for adoption, is covered under creditable coverage. This provision shall not apply to coverage before the date of such adoption or placement for adoption.

3.  Pregnancy.

(b)  Subparagraphs (a)1. and 2. do not apply to an individual after the end of the first 63-day period during all of which the individual was not covered under any creditable coverage.

(5)(a)  The term "creditable coverage" means, with respect to an individual, coverage of the individual under any of the following:

1.  A group health plan, as defined in s. 2791 of the Public Health Service Act.

2.  Health insurance coverage consisting of medical care, provided directly, through insurance or reimbursement or otherwise, and including terms and services paid for as medical care, under any hospital or medical service policy or certificate, hospital or medical service plan contract, or health maintenance contract offered by a health insurance issuer.

3.  Part A or part B of Title XVIII of the Social Security Act.

4.  Title XIX of the Social Security Act, other than coverage consisting solely of benefits under s. 1928.

5.  Chapter 55 of Title 10, United States Code.

6.  A medical care program of the Indian Health Service or of a tribal organization.

7.  The Florida Comprehensive Health Association or another state health benefit risk pool.

8.  A health plan offered under chapter 89 of Title 5, United States Code.

9.  A public health plan as defined by rule of the department. To the greatest extent possible, such rules must be consistent with regulations adopted by the United States Department of Health and Human Services.

10.  A health benefit plan under s. 5(e) of the Peace Corps Act (22 U.S.C. s. 2504(e)).

(b)  Creditable coverage does not include coverage that consists solely of one or more or any combination thereof of the following excepted benefits:

1.  Coverage only for accident, or disability income insurance, or any combination thereof.

2.  Coverage issued as a supplement to liability insurance.

3.  Liability insurance, including general liability insurance and automobile liability insurance.

4.  Workers' compensation or similar insurance.

5.  Automobile medical payment insurance.

6.  Credit-only insurance.

7.  Coverage for onsite medical clinics.

8.  Other similar insurance coverage, specified in rules adopted by the department, under which benefits for medical care are secondary or incidental to other insurance benefits. To the greatest extent possible, such rules must be consistent with regulations adopted by the United States Department of Health and Human Services.

(c)  The following benefits are not subject to the creditable coverage requirements, if offered separately;

1.  Limited scope dental or vision benefits.

2.  Benefits or long-term care, nursing home care, home health care, community-based care, or any combination of these.

3.  Such other similar, limited benefits as are specified in rules adopted by the department. To the greatest extent possible, such rules must be consistent with regulations adopted by the United States Department of Health and Human Services.

(d)  The following benefits are not subject to creditable coverage requirements if offered as independent, noncoordinated benefits:

1.  Coverage only for a specified disease or illness.

2.  Hospital indemnity or other fixed indemnity insurance.

(e)  Benefits provided through Medicare supplemental health insurance, as defined under s. 1882(g)(1) of the Social Security Act, coverage supplemental to the coverage provided under chapter 55 of Title 10, United States Code, and similar supplemental coverage provided to coverage under a group health plan are not considered creditable coverage if offered as a separate insurance policy.

(6)(a)  A period of creditable coverage may not be counted, with respect to enrollment of an individual under a group health maintenance organization contract, if, after such period and before the enrollment date, there was a 63-day period during all of which the individual was not covered under any creditable coverage.

(b)  Any period during which an individual is in a waiting period, or in an affiliation period as defined in subsection (9), for any coverage under a group health maintenance organization contract may not be taken into account in determining the 63-day period under paragraph (a) or paragraph (4)(b).

(7)(a)  Except as otherwise provided under paragraph (b), a health maintenance organization shall count a period of creditable coverage without regard to the specific benefits covered under the period.

(b)  A health maintenance organization may elect to count as creditable coverage, coverage of benefits within each of several classes or categories of benefits specified in rules adopted by the department rather than as provided under paragraph (a). Such election shall be made on a uniform basis for all participants and beneficiaries. Under such election, a health maintenance organization shall count a period of creditable coverage with respect to any class or category of benefits if any level of benefits is covered within such class or category.

(c)  In the case of an election with respect to a health maintenance organization under paragraph (b), the organization shall:

1.  Prominently state in 10-point type or larger in any disclosure statements concerning the contract, and state to each enrollee at the time of enrollment under the contract, that the organization has made such election; and

2.  Include in such statements a description of the effect of this election.

(8)(a)  Periods of creditable coverage with respect to an individual shall be established through presentation of certifications described in this subsection or in such other manner as may be specified in rules adopted by the department.

(b)  A health maintenance organization that offers group coverage shall provide the certification described in paragraph (a):

1.  At the time an individual ceases to be covered under the plan or otherwise becomes covered under a COBRA continuation provision or continuation pursuant to s. 627.6692.

2.  In the case of an individual becoming covered under a COBRA continuation provision or pursuant to s. 627.6692, at the time the individual ceases to be covered under such a provision.

3.  Upon the request on behalf of an individual made not later than 24 months after the date of cessation of the coverage described in this paragraph.

The certification under subparagraph 1. may be provided, to the extent practicable, at a time consistent with notices required under any applicable COBRA continuation provision or continuation pursuant to s. 627.6692.

(c)  The certification is a written certification of:

1.  The period of creditable coverage of the individual under the contract and the coverage, if any, under such COBRA continuation provision or continuation pursuant to s. 627.6692; and

2.  The waiting period, if any, imposed with respect to the individual for any coverage under such contract.

(d)  In the case of an election described in subsection (7) by a health maintenance organization, if the organization enrolls an individual for coverage under the plan and the individual provides a certification of coverage of the individual, as provided by this subsection:

1.  Upon request of such health maintenance organization, the insurer or health maintenance organization that issued the certification provided by the individual shall promptly disclose to such requesting organization information on coverage of classes and categories of health benefits available under such insurer's or health maintenance organization's plan or coverage.

2.  Such insurer or health maintenance organization may charge the requesting organization for the reasonable cost of disclosing such information.

(e)  The department shall adopt rules to prevent an insurer's or health maintenance organization's failure to provide information under this subsection with respect to previous coverage of an individual from adversely affecting any subsequent coverage of the individual under another group health plan or health maintenance organization coverage.

(9)(a)  A health maintenance organization may provide for an affiliation period with respect to coverage through the organization only if:

1.  No preexisting condition exclusion is imposed with respect to coverage through the organization;

2.  The period is applied uniformly without regard to any health-status-related factors; and

3.  Such period does not exceed 2 months or 3 months in the case of a late enrollee.

(b)  For the purposes of this section, the term "affiliation period" means a period that, under the terms of the coverage offered by the health maintenance organization, must expire before the coverage becomes effective. The organization is not required to provide health care services or benefits during such period, and no premium may be charged to the participant or beneficiary for any coverage during the period. Such period begins on the enrollment date and runs concurrently with any waiting period under the plan.

(c)  As an alternative to the method authorized by paragraph (a), a health maintenance organization may address adverse selection in a method approved by the department.

(10)(a)  Except as provided in paragraph (b), no period before July 1, 1996, shall be taken into account in determining creditable coverage.

(b)  The department shall adopt rules that provide a process whereby individuals who need to establish creditable coverage for periods before July 1, 1996, and who would have such coverage credited but for paragraph (a), may be given credit for creditable coverage for such periods through the presentation of documents or other means.

(11)  Except as otherwise provided in this subsection, the requirements of paragraph (8)(b) shall apply to events that occur on or after July 1, 1996.

(a)  In no case is a certification required to be provided under paragraph (8)(b) prior to June 1, 1997.

(b)  In the case of an event that occurs on or after July 1, 1996, and before October 1, 1996, a certification is not required to be provided under paragraph (8)(b), unless an individual, with respect to whom the certification is required to be made, requests such certification in writing.

(12)  In the case of an individual who seeks to establish creditable coverage for any period for which certification is not required because it relates to an event occurring before July 1, 1996:

(a)  The individual may present other creditable coverage in order to establish the period of creditable coverage.

(b)  A health maintenance organization is not subject to any penalty or enforcement action with respect to the organization's crediting, or not crediting, such coverage if the organization has sought to comply in good faith with applicable provisions of this section.

(13)  For purposes of subsection (10), any plan amendment made pursuant to a collective bargaining agreement relating to the plan which amends the plan solely to conform to any requirement of this section may not be treated as a termination of such collective bargaining agreement.

History.--s. 25, ch. 97-179; s. 55, ch. 99-3.

¹Note.--Section 34(2), ch. 97-179, provides that:

"(2)  Except as provided in section 627.6561(9), (10), and (11), and section 641.31071(10), (11), and (12), Florida Statutes, in the case of a group health plan or group health insurance contract maintained pursuant to one or more collective bargaining agreements between employee representatives and one or more employers which is ratified before this act becomes a law, sections 627.6561, 627.65615, 627.65625, 627.6571, 627.6699, 641.31071, 641.31072, 641.31073, and 641.31074, Florida Statutes, except for section 627.6561(8)(b), Florida Statutes, as amended or created by this act, apply to policies or contracts with plan years that begin on or after the later of:

"(a)  The date on which the last of any collective bargaining agreement that relates to the plan terminates, determined without regard to any extension thereof, which is agreed to after the date this act becomes a law; or

"(b)  July 1, 1997."

¹641.31072  Special enrollment periods.--

(1)  A health maintenance organization that issues a group health insurance policy shall permit an employee who is eligible, but not enrolled, for coverage under the terms of the contract, or a dependent of such an employee if the dependent is eligible but not enrolled for coverage under such terms, to enroll for coverage under the terms of the contract if each of the following conditions is met:

(a)  The employee or dependent was covered under a group health plan or had health insurance coverage at the time coverage was previously offered to the employee or dependent. For the purpose of this section, the terms "group health plan" and "health insurance coverage" have the same meaning ascribed in s. 2791 of the Public Health Service Act.

(b)  The employee stated in writing at such time that coverage under a group health plan or health insurance coverage was the reason for declining enrollment, but only if the plan sponsor or health maintenance organization, if applicable, required such a statement at such time and provided the employee with notice of such requirement and the consequences of such requirement at such time.

(c)  The employee's or dependent's coverage described in paragraph (a):

1.  Was under a COBRA continuation provision or continuation pursuant to s. 627.6692, and the coverage under such provision was exhausted; or

2.  Was not under such a provision and the coverage was terminated as a result of loss of eligibility for the coverage, including legal separation, divorce, death, termination of employment, or reduction in the number of hours of employment, or the coverage was terminated as a result of the termination of employer contributions toward such coverage.

(d)  Under the terms of the contract, the employee requests such enrollment not later than 30 days after the date of exhaustion of coverage described in subparagraph (c)1., or termination or employer contribution described in subparagraph (c)2.

(2)  For dependent beneficiaries, if:

(a)  A group health maintenance organization contract makes coverage available with respect to a dependent of an individual;

(b)  The individual is a participant under the contract, or has met any waiting period applicable to becoming a participant under the contract, and is eligible to be enrolled under the contract but for a failure to enroll during a previous enrollment period; and

(c)  A person becomes such a dependent of the individual through marriage, birth, or adoption or placement for adoption,

the health maintenance organization shall provide for a dependent special enrollment period described in subsection (3) during which the person, or, if not otherwise enrolled, the individual, may be enrolled under the plan as a dependent of the individual, and in the case of the birth or adoption of a child, the spouse of the individual may be enrolled as a dependent of the individual if such spouse is otherwise eligible for coverage.

(3)  A dependent special enrollment period under subsection (2) shall be a period of not less than 30 days and shall begin on the later of:

(a)  The date dependent coverage is made available; or

(b)  The date of the marriage, birth, or adoption or placement for adoption described in paragraph (2)(c).

(4)  If an individual seeks to enroll a dependent during the first 30 days of such a dependent special enrollment period, the coverage of the dependent shall become effective:

(a)  In the case of marriage, not later than the first day of the first month beginning after the date the completed request for enrollment is received.

(b)  In the case of a dependent's birth, as of the date of such birth.

(c)  In the case of a dependent's adoption or placement for adoption, the date of such adoption or placement for adoption.

History.--s. 26, ch. 97-179.

¹Note.--Section 34(2), ch. 97-179, provides that:

"(2)  Except as provided in section 627.6561(9), (10), and (11), and section 641.31071(10), (11), and (12), Florida Statutes, in the case of a group health plan or group health insurance contract maintained pursuant to one or more collective bargaining agreements between employee representatives and one or more employers which is ratified before this act becomes a law, sections 627.6561, 627.65615, 627.65625, 627.6571, 627.6699, 641.31071, 641.31072, 641.31073, and 641.31074, Florida Statutes, except for section 627.6561(8)(b), Florida Statutes, as amended or created by this act, apply to policies or contracts with plan years that begin on or after the later of:

"(a)  The date on which the last of any collective bargaining agreement that relates to the plan terminates, determined without regard to any extension thereof, which is agreed to after the date this act becomes a law; or

"(b)  July 1, 1997."

¹641.31073  Prohibiting discrimination against individual participants and beneficiaries based on health status.--

(1)  Subject to subsection (2), a health maintenance organization that offers group health insurance coverage may not establish rules for eligibility, including continued eligibility, of an individual to enroll under the terms of the contract based on any of the following health-status-related factors in relation to the individual or a dependent of the individual:

(a)  Health status.

(b)  Medical condition, including physical and mental illnesses.

(c)  Claims experience.

(d)  Receipt of health care.

(e)  Medical history.

(f)  Genetic information.

(g)  Evidence of insurability, including conditions arising out of acts of domestic violence.

(h)  Disability.

(2)  Subsection (1) does not:

(a)  Require a health maintenance organization to provide particular benefits other than those provided under the terms of such plan or coverage.

(b)  Prevent such a plan or coverage from establishing limitations or restrictions on the amount, level, extent, or nature of the benefits or coverage for similarly situated individuals enrolled in the plan or coverage.

(3)  For purposes of subsection (1), rules for eligibility to enroll under a contract include rules for defining any applicable affiliation or waiting periods of enrollment.

(4)(a)  A health maintenance organization that offers health insurance coverage may not require any individual, as a condition of enrollment or continued enrollment under the contract, to pay a premium or contribution that is greater than such premium or contribution for a similarly situated individual enrolled under the contract on the basis of any health-status-related factor in relation to the individual or to an individual enrolled under the contract as a dependent of the individual.

(b)  This subsection does not:

1.  Restrict the amount that an employer may be charged for coverage under a group health insurance contract.

2.  Prevent a health maintenance organization offering group health insurance coverage from establishing premium discounts or rebates or modifying otherwise applicable copayments or deductibles in return for adherence to programs of health promotion and disease prevention.

History.--s. 27, ch. 97-179.

¹Note.--Section 34(2), ch. 97-179, provides that:

"(2)  Except as provided in section 627.6561(9), (10), and (11), and section 641.31071(10), (11), and (12), Florida Statutes, in the case of a group health plan or group health insurance contract maintained pursuant to one or more collective bargaining agreements between employee representatives and one or more employers which is ratified before this act becomes a law, sections 627.6561, 627.65615, 627.65625, 627.6571, 627.6699, 641.31071, 641.31072, 641.31073, and 641.31074, Florida Statutes, except for section 627.6561(8)(b), Florida Statutes, as amended or created by this act, apply to policies or contracts with plan years that begin on or after the later of:

"(a)  The date on which the last of any collective bargaining agreement that relates to the plan terminates, determined without regard to any extension thereof, which is agreed to after the date this act becomes a law; or

"(b)  July 1, 1997."

¹641.31074  Guaranteed renewability of coverage.--

(1)  Except as otherwise provided in this section, a health maintenance organization that issues a group health insurance contract must renew or continue in force such coverage at the option of the contract holder.

(2)  A health maintenance organization may nonrenew or discontinue a contract based only on one or more of the following conditions:

(a)  The contract holder has failed to pay premiums or contributions in accordance with the terms of the contract or the health maintenance organization has not received timely premium payments.

(b)  The contract holder has performed an act or practice that constitutes fraud or made an intentional misrepresentation of material fact under the terms of the contract.

(c)  The contract holder has failed to comply with a material provision of the plan which relates to rules for employer contributions or group participation.

(d)  The health maintenance organization is ceasing to offer coverage in such a market in accordance with subsection (3).

(e)  There is no longer any enrollee in connection with such plan who lives, resides, or works in the service area of the health maintenance organization or in the area in which the health maintenance organization is authorized to do business and, in the case of the small group market, the organization would deny enrollment with respect to such plan under s. 627.6699(5)(i).

(f)  In the case of coverage that is made available only through one or more bona fide associations as defined in s. 627.6571(5), the membership of an employer in the association, on the basis of which the coverage is provided, ceases, but only if such coverage is terminated under this paragraph uniformly without regard to any health-status-related factor that relates to any covered individuals.

(3)(a)  A health maintenance organization may discontinue offering a particular contract form for group coverage offered in the small group market or large group market only if:

1.  The health maintenance organization provides notice to each contract holder provided coverage of this form in such market, and participants and beneficiaries covered under such coverage, of such discontinuation at least 90 days prior to the date of the nonrenewal of such coverage;

2.  The health maintenance organization offers to each contract holder provided coverage of this form in such market the option to purchase all, or in the case of the large group market, any other health insurance coverage currently being offered by the health maintenance organization in such market; and

3.  In exercising the option to discontinue coverage of this form and in offering the option of coverage under subparagraph 2., the health maintenance organization acts uniformly without regard to the claims experience of those contract holders or any health-status-related factor that relates to any participants or beneficiaries covered or new participants or beneficiaries who may become eligible for such coverage.

(b)1.  In any case in which a health maintenance organization elects to discontinue offering all coverage in the small group market or the large group market, or both, in this state, coverage may be discontinued by the insurer only if:

a.  The health maintenance organization provides notice to the department and to each contract holder, and participants and beneficiaries covered under such coverage, of such discontinuation at least 180 days prior to the date of the nonrenewal of such coverage; and

b.  All health insurance issued or delivered for issuance in this state in such market is discontinued and coverage under such health insurance coverage in such market is not renewed.

2.  In the case of a discontinuation under subparagraph 1. in a market, the health maintenance organization may not provide for the issuance of any health maintenance organization contract coverage in the market in this state during the 5-year period beginning on the date of the discontinuation of the last insurance contract not renewed.

(4)  At the time of coverage renewal, a health maintenance organization may modify the coverage for a product offered:

(a)  In the large group market; or

(b)  In the small group market if, for coverage that is available in such market other than only through one or more bona fide associations, as defined in s. 627.6571(5), such modification is consistent with s. 627.6699 and effective on a uniform basis among group health plans with that product.

(5)  In applying this section in the case of health insurance coverage that is made available by a health maintenance organization in the small group market or large group market to employers only through one or more associations, a reference to "contract holder" is deemed, with respect to coverage provided to an employer member of the association, to include a reference to such employer.

History.--s. 28, ch. 97-179; s. 24, ch. 98-159.

¹Note.--Section 34(2), ch. 97-179, provides that:

"(2)  Except as provided in section 627.6561(9), (10), and (11), and section 641.31071(10), (11), and (12), Florida Statutes, in the case of a group health plan or group health insurance contract maintained pursuant to one or more collective bargaining agreements between employee representatives and one or more employers which is ratified before this act becomes a law, sections 627.6561, 627.65615, 627.65625, 627.6571, 627.6699, 641.31071, 641.31072, 641.31073, and 641.31074, Florida Statutes, except for section 627.6561(8)(b), Florida Statutes, as amended or created by this act, apply to policies or contracts with plan years that begin on or after the later of:

"(a)  The date on which the last of any collective bargaining agreement that relates to the plan terminates, determined without regard to any extension thereof, which is agreed to after the date this act becomes a law; or

"(b)  July 1, 1997."

¹641.3108  Notice of cancellation of contract.--

(1)  Except for nonpayment of premium or termination of eligibility, no health maintenance organization may cancel or otherwise terminate or fail to renew a health maintenance contract without giving the subscriber at least 45 days' notice in writing of the cancellation, termination, or nonrenewal of the contract. The written notice shall state the reason or reasons for the cancellation, termination, or nonrenewal. All health maintenance contracts shall contain a clause which requires that this notice be given.

(2)  If cancellation is due to nonpayment of premium, the health maintenance organization may not retroactively cancel the contract to a date prior to the date that notice of cancellation was provided to the subscriber unless the organization mails notice of cancellation to the subscriber prior to 45 days after the date the premium was due. Such notice must be mailed to the subscriber's last address as shown by the records of the organization and may provide for a retroactive date of cancellation no earlier than midnight of the date that the premium was due.

(3)  In the case of a health maintenance contract issued to an employer or person holding the contract on behalf of the subscriber group, the health maintenance organization may make the notification through the employer or group contract holder, and, if the health maintenance organization elects to take this action through the employer or group contract holder, the organization shall be deemed to have complied with the provisions of this section upon notifying the employer or group contract holder of the requirements of this section and requesting the employer or group contract holder to forward to all subscribers the notice required herein.

History.--ss. 30, 47, ch. 85-177; ss. 122, 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 14, ch. 99-204; s. 8, ch. 99-275; s. 13, ch. 99-393.

¹Note.--

A.  Section 10, ch. 99-275, provides that "[t]his act shall take effect July 1, 1999, and shall apply to all contracts renewed or entered into on or after that date."

B.  Section 16, ch. 99-204, provides that "[t]his act shall take effect October 1, 1999, and shall apply to policies and contracts issued or renewed on or after that date."

641.31094  Nondiscrimination of coverage for certain surgical procedures involving bones or joints.--No health maintenance contract or policy which provides coverage for any diagnostic or surgical procedure involving bones or joints of the skeleton shall discriminate against coverage for any similar diagnostic or surgical procedure involving bones or joints of the jaw and facial region, if, under accepted medical standards, such procedure or surgery is medically necessary to treat conditions caused by congenital or developmental deformity, disease, or injury. This section shall not be construed to affect any other coverage under this part or to restrict the scope of coverage under any policy, plan, or contract. Nothing in this section shall be construed to discourage appropriate nonsurgical procedures or to prohibit the continued coverage of nonsurgical procedures in the treatment of a bone or joint of the jaw and facial region. Furthermore, nothing in this subsection requires coverage for care or treatment of the teeth or gums, for intraoral prosthetic devices, or for surgical procedures for cosmetic purposes.

History.--s. 5, ch. 96-361.

641.31095  Coverage for mammograms.--

(1)  Every health maintenance contract issued or renewed on or after January 1, 1996, shall provide coverage for at least the following:

(a)  A baseline mammogram for any woman who is 35 years of age or older, but younger than 40 years of age.

(b)  A mammogram every 2 years for any woman who is 40 years of age or older, but younger than 50 years of age, or more frequently based on the patient's physician's recommendations.

(c)  A mammogram every year for any woman who is 50 years of age or older.

(d)  One or more mammograms a year, based upon a physician's recommendation for any woman who is at risk for breast cancer because of a personal or family history of breast cancer, because of having a history of biopsy-proven benign breast disease, because of having a mother, sister, or daughter who has had breast cancer, or because a woman has not given birth before the age of 30.

(2)  The coverage required by this section is subject to the deductible and copayment provisions applicable to outpatient visits, and is also subject to all other terms and conditions applicable to other benefits. A health maintenance organization shall make available to the subscriber as part of the application, for an appropriate additional premium, the coverage required in this section without such coverage being subject to any deductible or copayment provisions in the contract.

History.--s. 9, ch. 95-188.

641.31096  Requirements with respect to breast cancer and routine followup care.--Routine followup care to determine whether a breast cancer has recurred in a person who has been previously determined to be free of breast cancer does not constitute medical advice, diagnosis, care, or treatment for purposes of determining preexisting conditions unless evidence of breast cancer is found during or as a result of the followup care.

History.--s. 11, ch. 97-48.

641.3111  Extension of benefits.--

(1)  Every group health maintenance contract shall provide that termination of the contract shall be without prejudice to any continuous loss which commenced while the contract was in force, but any extension of benefits beyond the period the contract was in force may be predicated upon the continuous total disability of the subscriber and may be limited to payment for the treatment of a specific accident or illness incurred while the subscriber was a member. Such extension of benefits may be limited to the occurrence of the earliest of the following events:

(a)  The expiration of 12 months.

(b)  Such time as the member is no longer totally disabled.

(c)  A succeeding carrier elects to provide replacement coverage without limitation as to the disability condition.

(d)  The maximum benefits payable under the contract have been paid.

(2)  For the purposes of this section, an individual is totally disabled if the individual has a condition resulting from an illness or injury which prevents an individual from engaging in any employment or occupation for which the individual is or may become qualified by reason of education, training, or experience, and the individual is under the regular care of a physician.

(3)  In the case of maternity coverage, when not covered by the succeeding carrier, a reasonable extension of benefits or accrued liability provision is required, which provision provides for continuation of the contract benefits in connection with maternity expenses for a pregnancy that commenced while the policy was in effect. The extension shall be for the period of that pregnancy and shall not be based upon total disability.

(4)  Except as provided in subsection (1), no subscriber is entitled to an extension of benefits if the termination of the contract by the health maintenance organization is based upon any event referred to in s. 641.3922(7)(a), (b), or (e).

History.--ss. 16, 24, ch. 88-388; ss. 124, 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 25, ch. 98-159.

641.315  Provider contracts.--

(1)  Whenever a contract exists between a health maintenance organization and a provider and the organization fails to meet its obligations to pay fees for services already rendered to a subscriber, the health maintenance organization shall be liable for such fee or fees rather than the subscriber; and the contract shall so state.

(2)  No subscriber of an HMO shall be liable to any provider of health care services for any services covered by the HMO.

(3)  No provider of services or any representative of such provider shall collect or attempt to collect from an HMO subscriber any money for services covered by an HMO and no provider or representative of such provider may maintain any action at law against a subscriber of an HMO to collect money owed to such provider by an HMO.

(4)  Every contract between an HMO and a provider of health care services shall be in writing and shall contain a provision that the subscriber shall not be liable to the provider for any services covered by the subscriber's contract with the HMO.

(5)  The provisions of this section shall not be construed to apply to the amount of any deductible or copayment which is not covered by the contract of the HMO.

(6)(a)  For all provider contracts executed after October 1, 1991, and within 180 days after October 1, 1991, for contracts in existence as of October 1, 1991:

1.  The contracts must provide that the provider shall provide 60 days' advance written notice to the health maintenance organization and the department before canceling the contract with the health maintenance organization for any reason; and

2.  The contract must also provide that nonpayment for goods or services rendered by the provider to the health maintenance organization shall not be a valid reason for avoiding the 60-day advance notice of cancellation.

(b)  For all provider contracts executed after October 1, 1996, and within 180 days after October 1, 1996, for contracts in existence as of October 1, 1996, the contracts must provide that the health maintenance organization will provide 60 days' advance written notice to the provider and the department before canceling, without cause, the contract with the provider, except in a case in which a patient's health is subject to imminent danger or a physician's ability to practice medicine is effectively impaired by an action by the Board of Medicine or other governmental agency.

(7)  Upon receipt by the health maintenance organization of a 60-day cancellation notice, the health maintenance organization may, if requested by the provider, terminate the contract in less than 60 days if the health maintenance organization is not financially impaired or insolvent.

(8)  A contract between a health maintenance organization and a provider of health care services shall not contain any provision restricting the provider's ability to communicate information to the provider's patient regarding medical care or treatment options for the patient when the provider deems knowledge of such information by the patient to be in the best interest of the health of the patient.

¹(9)  A contract between a health maintenance organization and a provider of health care services may not contain any provision that in any way prohibits or restricts:

(a)  The health care provider from entering into a commercial contract with any other health maintenance organization; or

(b)  The health maintenance organization from entering into a commercial contract with any other health care provider.

²(10)  A health maintenance organization or health care provider may not terminate a contract with a health care provider or health maintenance organization unless the party terminating the contract provides the terminated party with a written reason for the contract termination, which may include termination for business reasons of the terminating party. The reason provided in the notice required in this section or any other information relating to the reason for termination does not create any new administrative or civil action and may not be used as substantive evidence in any such action, but may be used for impeachment purposes. As used in this subsection, the term "health care provider" means a physician licensed under chapter 458, chapter 459, chapter 460, or chapter 461, or a dentist licensed under chapter 466.

History.--ss. 795, 809(1st), ch. 82-243; s. 12, ch. 83-198; s. 17, ch. 88-388; ss. 125, 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 5, ch. 96-223; s. 2, ch. 97-159; s. 2, ch. 99-264; s. 4, ch. 99-275.

¹Note.--Section 10, ch. 99-275, provides that "[t]his act shall take effect July 1, 1999, and shall apply to all contracts renewed or entered into on or after that date."

²Note.--Section 6, ch. 99-264, provides that "[t]his act shall take effect [June 8, 1999] and shall apply only to contracts entered into after the effective date."

641.3155  Provider contracts; payment of claims.--

(1)(a)  A health maintenance organization shall pay any claim or any portion of a claim made by a contract provider for services or goods provided under a contract with the health maintenance organization which the organization does not contest or deny within 35 days after receipt of the claim by the health maintenance organization which is mailed or electronically transferred by the provider.

(b)  A health maintenance organization that denies or contests a provider's claim shall notify the contract provider, in writing, within 35 days after receipt of the claim by the health maintenance organization that the claim is contested or denied. The notice that the claim is denied or contested must identify the contested portion of the claim and the specific reason for contesting or denying the claim, and may include a request for additional information. If the health maintenance organization requests additional information, the provider shall, within 35 days after receipt of such request, mail or electronically transfer the information to the health maintenance organization. The health maintenance organization shall pay or deny the claim or portion of the claim within 45 days after receipt of the information.

(2)  Payment of a claim is considered made on the date the payment was received or electronically transferred or otherwise delivered. An overdue payment of a claim bears simple interest at the rate of 10 percent per year.

(3)  A health maintenance organization shall pay or deny any claim no later than 120 days after receiving the claim.

(4)  Any retroactive reductions of payments or demands for refund of previous overpayments which are due to retroactive review-of-coverage decisions or payment levels must be reconciled to specific claims unless the parties agree to other reconciliation methods and terms. Any retroactive demands by providers for payment due to underpayments or nonpayments for covered services must be reconciled to specific claims unless the parties agree to other reconciliation methods and terms. The look-back period may be specified by the terms of the contract.

History.--s. 1, ch. 98-79; s. 5, ch. 99-393.

641.316  Fiscal intermediary services.--

(1)  It is the intent of the Legislature, through the adoption of this section, to ensure the financial soundness of fiscal intermediary services organizations established to develop, manage, and administer the business affairs of health care professional providers such as medical doctors, doctors of osteopathy, doctors of chiropractic medicine, doctors of podiatric medicine, doctors of dentistry, or other health professionals regulated by the Department of Health.

(2)¹(a)  The term "fiduciary" or "fiscal intermediary services" means reimbursements received or collected on behalf of health care professionals for services rendered, patient and provider accounting, financial reporting and auditing, receipts and collections management, compensation and reimbursement disbursement services, or other related fiduciary services pursuant to health care professional contracts with health maintenance organizations. All payments to a health care provider by a fiscal intermediary for noncapitated providers must include an explanation of services being reimbursed which includes, at a minimum, the patient's name, the date of service, the procedure code, the amount of reimbursement, and the identification of the plan on whose behalf the payment is being made. For capitated providers, the statement of services must include the number of patients covered by the contract, the rate per patient, the total amount of the payment, and the identification of the plan on whose behalf the payment is being made.

(b)  The term "fiscal intermediary services organization" means a person or entity which performs fiduciary or fiscal intermediary services to health care professionals who contract with health maintenance organizations other than a fiscal intermediary services organization owned, operated, or controlled by a hospital licensed under chapter 395, an insurer licensed under chapter 624, a third-party administrator licensed under chapter 626, a prepaid limited health service organization licensed under chapter 636, a health maintenance organization licensed under this chapter, or physician group practices as defined in s. 455.654(3)(f).

(3)  A fiscal intermediary services organization that is operated for the purpose of acquiring and administering provider contracts with managed care plans for professional health care services, including, but not limited to, medical, surgical, chiropractic, dental, and podiatric care, and which performs fiduciary or fiscal intermediary services shall be required to secure and maintain a fidelity bond in the minimum amount of 10 percent of the funds handled by the intermediary in connection with its fiscal and fiduciary services during the prior year or $1 million, whichever is less. The minimum bond amount shall be $50,000. The fidelity bond shall protect the fiscal intermediary from loss caused by the dishonesty of its employees and must remain unimpaired for as long as the intermediary continues in business in the state.

(4)  A fiscal intermediary services organization, as described in subsection (3), shall secure and maintain a surety bond on file with the department, naming the intermediary as principal. The bond must be obtained from a company authorized to write surety insurance in the state, and the department shall be obligee on behalf of itself and third parties. The penal sum of the bond may not be less than 5 percent of the funds handled by the intermediary in connection with its fiscal and fiduciary services during the prior year or $250,000, whichever is less. The minimum bond amount must be $10,000. The condition of the bond must be that the intermediary shall register with the department and shall not misappropriate funds within its control or custody as a fiscal intermediary or fiduciary. The aggregate liability of the surety for any and all breaches of the conditions of the bond may not exceed the penal sum of the bond. The bond must be continuous in form, must be renewed annually by a continuation certificate, and may be terminated by the surety upon its giving 30 days' written notice of termination to the department.

(5)  A fiscal intermediary services organization may not collect from the subscriber any payment other than the copayment or deductible specified in the subscriber agreement.

(6)  Any fiscal intermediary services organization, other than a fiscal intermediary services organization owned, operated, or controlled by a hospital licensed under chapter 395, an insurer licensed under chapter 624, a third-party administrator licensed under chapter 626, a prepaid limited health service organization licensed under chapter 636, a health maintenance organization licensed under this chapter, or physician group practices as defined in s. 455.654(3)(f), must register with the department and meet the requirements of this section. In order to register as a fiscal intermediary services organization, the organization must comply with ss. 641.21(1)(c) and (d) and 641.22(6). Should the department determine that the fiscal intermediary services organization does not meet the requirements of this section, the registration shall be denied. In the event that the registrant fails to maintain compliance with the provisions of this section, the department may revoke or suspend the registration. In lieu of revocation or suspension of the registration, the department may levy an administrative penalty in accordance with s. 641.25.

(7)  The department shall adopt rules necessary to administer this section.

History.--s. 3, ch. 97-159; s. 26, ch. 98-159; ss. 162, 293, ch. 98-166; s. 5, ch. 99-275; s. 174, ch. 99-397.

¹Note.--Section 10, ch. 99-275, provides that "[t]his act shall take effect July 1, 1999, and shall apply to all contracts renewed or entered into on or after that date."

641.32  Acceptable payments.--Each health maintenance organization may accept from governmental agencies, corporations, associations, groups, or individuals payments covering all or part of the cost of contracts entered into between the health maintenance organization and its subscribers.

History.--s. 16, ch. 72-264; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 796, 804, 809(1st), ch. 82-243; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.33  Certain words prohibited in name of organization.--

(1)  No entity certificated as a health maintenance organization, other than a licensed insurer insofar as its name is concerned, shall use in its name, contracts, or literature any of the words "insurance," "casualty," "surety," "mutual," or any other words descriptive of the insurance, casualty, or surety business or deceptively similar to the name or description of any insurance or surety corporation doing business in the state.

(2)  No person, entity, or health care plan not certificated under the provisions of this part shall use in its name, logo, contracts, or literature the phrase "health maintenance organization" or the initials "HMO"; imply, directly or indirectly, that it is a health maintenance organization; or hold itself out to be a health maintenance organization.

History.--s. 17, ch. 72-264; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 797, 804, 809(1st), ch. 82-243; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.35  Assets, liabilities, and investments.--

(1)  ASSETS.--In any determination of the financial condition of a health maintenance organization, there shall be allowed as "assets" only those assets that are owned by the health maintenance organization and which assets consist of:

(a)  Cash in the possession of the health maintenance organization, or in transit under its control, including the true balance of any deposit in a solvent bank, savings and loan association, or trust company which is domiciled in the United States.

(b)  Investments, securities, properties, and loans acquired or held in accordance with this part, and in connection therewith the following items:

1.  Interest due or accrued on any bond or evidence of indebtedness which is not in default and which is not valued on a basis including accrued interest.

2.  Declared and unpaid dividends on stock and shares, unless the amount of the dividends has otherwise been allowed as an asset.

3.  Interest due or accrued upon a collateral loan which is not in default in an amount not to exceed 1 year's interest thereon.

4.  Interest due or accrued on deposits or certificates of deposit in solvent banks, savings and loan associations, and trust companies domiciled in the United States, and interest due or accrued on other assets, if such interest is in the judgment of the department a collectible asset.

5.  Interest due or accrued on current mortgage loans, in an amount not exceeding in any event the amount, if any, of the excess of the value of the property less delinquent taxes thereon over the unpaid principal; but in no event shall interest accrued for a period in excess of 90 days be allowed as an asset.

6.  Rent due or accrued on real property if such rent is not in arrears for more than 3 months. However, in no event shall rent accrued for a period in excess of 90 days be allowed as an asset.

7.  The unaccrued portion of taxes paid prior to the due date on real property.

(c)  Premiums in the course of collection, not more than 3 months past due, less commissions payable thereon. The foregoing limitation shall not apply to premiums payable directly or indirectly by any governmental body in the United States or by any of their instrumentalities.

(d)  The full amount of reinsurance recoverable from a solvent reinsurer, which reinsurance is authorized under s. 624.610.

(e)  Furniture, fixtures, furnishings, vehicles, medical libraries, and equipment, if the original cost of each item is at least $200, which cost shall be amortized in full over a period not to exceed 5 calendar years, unless otherwise approved by the department.

(f)  Pharmaceutical and medical supply inventories.

(g)  The liquidation value of prepaid expenses.

(h)  Other assets, not inconsistent with the provisions of this section, deemed by the department to be available for the payment of losses and claims, at values to be determined by it.

The department, upon determining that a health maintenance organization's asset has not been evaluated according to applicable law or that it does not qualify as an asset, shall require the health maintenance organization to properly reevaluate the asset or replace the asset with an asset suitable to the department within 30 days of receipt of written notification by the department of this determination, if the removal of the asset from the organization's assets would impair the organization's solvency.

(2)  ASSETS NOT ALLOWED.--In addition to assets impliedly excluded by the provisions of subsection (1), the following assets expressly shall not be allowed as assets in any determination of the financial condition of a health maintenance organization:

(a)  Goodwill, subscriber lists, patents, trade names, agreements not to compete, and other like intangible assets.

(b)  Any note or account receivable from or advances to officers, directors, or controlling stockholders, whether secured or not, and advances to employees, agents, or other persons on personal security only.

(c)  Stock of the health maintenance organization owned by it directly or owned by it through any entity in which the organization owns or controls, directly or indirectly, more than 25 percent of the ownership interest.

(d)  Leasehold improvements, nonmedical libraries, stationery, literature, and nonmedical supply inventories, except that leasehold improvements made prior to October 1, 1985, shall be allowed as an asset and shall be amortized over the shortest of the following periods:

1.  The life of the lease.

2.  The useful life of the improvements.

3.  The 3-year period following October 1, 1985.

(e)  Furniture, fixtures, furnishings, vehicles, medical libraries, and equipment, other than those items authorized under paragraph (1)(e).

(f)  Notes or other evidences of indebtedness which are secured by mortgages or deeds of trust which are in default and beyond the express period specified in the instrument for curing the default.

(g)  Bonds in default for more than 60 days.

(h)  Deferred costs other than the liquidation value of prepaid expenses.

(i)  Any note, account receivable, advance, or other evidence of indebtedness, or investment in:

1.  The parent of the health maintenance organization;

2.  Any entity directly or indirectly controlled by the health maintenance organization parent; or

3.  An affiliate of the parent or the health maintenance organization,

except as allowed in subsections (11) and (12). The department may, however, allow all or a portion of such asset, at values to be determined by the department, if deemed by the department to be available for the payment of losses and claims.

(3)  LIABILITIES.--In any determination of the financial condition of a health maintenance organization, liabilities to be charged against its assets shall include:

(a)  The amount, estimated consistently with the provisions of this part, necessary to pay all of its unpaid losses and claims incurred for or on behalf of a subscriber, on or prior to the end of the reporting period, whether reported or unreported.

(b)  The amount equal to the unearned portions of the gross premiums charged on health maintenance contracts in force.

(c)  Taxes, expenses, and other obligations due or accrued at the date of the statement.

The department, upon determining that a health maintenance organization has failed to report liabilities that should have been reported, shall require a corrected report which reflects the proper liabilities to be submitted by the organization to the department within 10 working days of receipt of written notification.

(4)  INVESTMENTS GENERALLY.--Health maintenance organizations may invest their funds only in accordance with the provisions of this part. Notwithstanding the provisions of this part, however, the department may, after notice and hearing, order a health maintenance organization to limit or withdraw from certain investments or to discontinue certain investment practices, to the extent that the department finds the investment practices hazardous to the financial condition of the organization. At any such hearing, the department shall have the burden of presenting a prima facie case that the investment or investment practices are hazardous to the financial condition of the organization. If the department presents such a prima facie case, then it shall be the organization's burden to demonstrate that the investment or investment practices are not hazardous to the financial condition of the organization.

(5)  ELIGIBLE INVESTMENTS.--

(a)  Health maintenance organizations shall invest in or lend their funds on the security of, and shall hold as invested assets, only eligible investments as prescribed in this part.

(b)  Any particular investment held by a health maintenance organization on October 1, 1985, which was a legal investment at the time it was made and which the organization was legally entitled to possess immediately prior to October 1, 1985, shall be deemed to be an eligible investment.

(c)  The eligibility of an investment shall be determined as of the date of its making or acquisition, except as stated in paragraph (b).

(d)  Any investment limitation based upon the amount of the organization's assets or particular funds shall relate to such assets or funds as shown by the organization's annual or quarterly report as of the end of the reporting period immediately preceding the date of acquisition of the investment by the organization or as shown by a current financial statement of the organization.

(6)  GENERAL QUALIFICATIONS.--

(a)  No security or investment other than real property and personal property acquired under subsection (10) or investments in other health care providers acquired under subsection (11) shall be eligible for acquisition unless it is interest-bearing or interest-accruing, is entitled to receive dividends if and when declared and paid or is otherwise income-producing, and is not then in default in any respect and unless the health maintenance organization is entitled to receive for its exclusive account and benefit the interest or income accruing thereon.

(b)  No security or investment shall be eligible for purchase at a price above its market value unless it is approved by the department.

(c)  No provision of this part shall prohibit the acquisition by a health maintenance organization of other or additional securities or property if received as a dividend, as a lawful distribution of assets, or under a lawful and bona fide agreement of merger or consolidation. Any investment so acquired which is not otherwise eligible under this part shall be disposed of pursuant to subsection (17) if property or securities.

(7)  DIRECTORS MUST AUTHORIZE OR RATIFY INVESTMENTS.--No investment or loan shall be made or engaged in by any health maintenance organization unless the same has been authorized or ratified by the organization's board of directors or by a committee, department, or section of the organization charged with the duty of supervising investments and loans. The minutes or records of any such committee, department, or section shall be maintained and regular reports of such committee, department, or section shall be submitted to the board of directors. No health maintenance organization shall subscribe to or participate in any underwriting of the purchase or sale of securities or property or enter into any agreement to withhold from sale any of its property, but the disposition of its property shall be at all times within the control of the board of directors. Nothing contained in this section shall prevent the board of directors of any health maintenance organization from depositing any of its securities with a committee appointed for the purpose of protecting the interest of security holders or with the authorities of any state or county where it is necessary to do so in order to secure permission to transact its appropriate business therein, and nothing contained in this section shall prevent the board of directors of the organization from depositing any securities as collateral for the securing of any bond required for the business of the organization.

(8)  EXCESSIVE COMMISSIONS AND CERTAIN INTERESTS PROHIBITED.--

(a)  No health maintenance organization shall pay any commission or brokerage for the purchase or sale of property, whether real or personal, in excess of that usual and customary at the time and in the locality where the purchases or sales are made. Information regarding payments of commissions and brokerage shall be maintained from the date of the most recent examination by the department pursuant to s. 641.27 until the date of completion of the following examination.

(b)  No health maintenance organization shall knowingly invest in or loan upon any property, directly or indirectly, whether real or personal, in which any officer or director of the organization has a financial interest, nor shall any organization make a loan of any kind to any officer or director of the organization, except that:

1.  This paragraph shall not apply to loans in circumstances in which the financial interest of the officer or director is only nominal, trifling, or so remote as not to give rise to a conflict of interest; and

2.  In any case, the department may approve a transaction between an organization and its officers or directors under this paragraph if it is satisfied that:

a.  The transaction is entered into in good faith for the advantage and benefit of the organization,

b.  The amount of the proposed investment or loan does not violate any other provision of this part or exceed the reasonable, normal value of the property or the interest which the company proposed to acquire,

c.  The transaction is otherwise fair and reasonable, and

d.  The transaction will not adversely affect, to any substantial degree, the liquidity of the organization's investments or its ability thereafter to comply with requirements of this part or the payment of its claims and obligations.

(9)  SURPLUS AND DEPOSIT RESTRICTIONS.--Every health maintenance organization must maintain an amount equal to its required minimum surplus in coin or currency of the United States on hand or on deposit in any solvent national or state bank, savings and loan association, or trust company or in eligible securities or obligations as follows:

(a)  Nondemand obligations of certain financial institutions.--Direct, unconditional nondemand obligations for the payment of money issued by a solvent bank or by a mutual savings bank or trust company, savings and loan, building and loan, or credit union, subject to the following:

1.  The financial institution is solvent.

2.  The financial institution is incorporated under the laws of the United States or of any state thereof.

3.  The obligations are of the type which are insured by an agency of the United States.

4.  The investment is in the name of and owned by the health maintenance organization, unless the account is under a trusteeship with the organization named as the beneficiary.

(b)  Obligations of the United States.--Direct obligations of the United States for the payment of money or obligations for the payment of money to the extent guaranteed or insured as to the payment of principal and interest by the United States.

(c)  Obligations of agencies and instrumentalities of the United States.--Direct obligations for the payment of money issued by an agency or instrumentality of the United States or obligations for the payment of money to the extent guaranteed or insured as to the payment of principal and interest by an agency or instrumentality of the United States.

(d)  Obligations of a state.--Direct, general obligations of any state of the United States for the payment of money, or obligations for the payment of money to the extent guaranteed or insured as to the payment of principal and interest by full faith and credit of any state of the United States, on the following conditions:

1.  The state has the power to levy taxes for the prompt payment of the principal and interest of such obligations.

2.  The state is not in default in the payment of principal or interest on any of its direct, guaranteed, or insured general obligations at the date of such investment.

(e)  Obligations of political subdivisions of a state.--Direct, general obligations of any political subdivision of any state of the United States for the payment of money, or obligations for the payment of money to the extent guaranteed as to the payment of principal and interest by any political subdivision of any state of the United States, on the following conditions:

1.  The obligations are payable or guaranteed from ad valorem taxes.

2.  The political subdivision is not in default in the payment of principal or interest on any of its direct or guaranteed obligations.

3.  No investment shall be made under this paragraph in obligations which are secured only by special assessments for local improvements.

(10)  PROPERTY USED IN THE HEALTH MAINTENANCE ORGANIZATION'S BUSINESS.--Real estate, including leasehold estates, for the convenient accommodation of the organization's business operations, including home office, branch administrative offices, hospitals, medical clinics, medical professional buildings, and any other facility to be used in the provision of health care services, or real estate for rental to any health care provider under contract with the organization to provide health care services which shall be used in the provision of health care services to members of the organization by that provider, is acceptable as an investment on the following conditions:

(a)  Any parcel of real estate acquired under this subsection may include excess space for rent to others if it is reasonably anticipated that the excess will be required by the health maintenance organization for expansion or if the excess is reasonably required in order to have one or more buildings that will function as an economic unit.

(b)  The real estate may be subject to a mortgage.

(c)  The greater of the admitted value of the asset, as determined by statutory accounting principles, or, if approved by the department, the health maintenance organization's equity in the real estate plus all encumbrances on the real estate owned by the organization under this subsection, when added to the value of all personal and mixed property used in the organization's business, shall not exceed 75 percent of its admitted assets unless, with the permission of the department, it finds that the percentage of its admitted assets is insufficient to provide convenient accommodation for the organization's business and the operations of the organization would not otherwise be impaired.

(11)  INVESTMENTS IN ADMINISTRATIVE AND MANAGEMENT SERVICE ENTITIES AND OTHER HEALTH CARE PROVIDERS.--A health maintenance organization may invest directly or indirectly in real estate, common and preferred stocks, bonds or debentures, including convertible debentures, or other evidences of debts of or equity in an entity if the entity is owned by or, with the approval of the department, under contract to the organization to provide management services, administrative services, or health care services for the organization, on the following conditions:

(a)  Investments authorized under this subsection shall not exceed 50 percent of admitted assets, and these investments shall be included in the calculation of the overall limitation in paragraph (10)(c) relating to all real and personal property.

(b)  Investments may qualify under this section only insofar as a provider of management, administrative, or health care service relationship as defined herein exists. Upon cessation of such relationship, each investment shall be subject to the rules applicable to an investment of that type and must qualify under the appropriate limitation or, failing that, become ineligible and subject to disposal under subsection (17).

(12)  EXCHANGES OF FACILITIES OR ASSETS.--Health care or administrative service entities, if subsidiaries of or under contract to the health maintenance organization to provide administrative or health care services to the organization's members, may exchange facilities or similar assets to be used in the organization's business for stock of the organization. However, any exchange involving an entity under contract with the health maintenance organization must have the approval of the department prior to the exchange. These facilities or assets shall be valued in accordance with statutory accounting principles.

(13)  OTHER INVESTMENTS.--After satisfying the requirements of subsections (9), (10), (11), and (12), any funds of the health maintenance organization in excess of the minimum surplus required to be maintained under this part may be invested in any investment listed in this subsection or in subsections (9) and (14).

(a)  United States Government obligations.--A health maintenance organization may invest in bonds, notes, warrants, and other evidences of indebtedness which are direct obligations of the Government of the United States or for which the full faith and credit of the Government of the United States is pledged for the payment of principal and interest.

(b)  Loans guaranteed by the United States.--

1.  A health maintenance organization may invest in loans insured or guaranteed as to principal and interest by the Government of the United States, or by any agency or instrumentality of the Government of the United States, to the extent of such insurance or guaranty.

2.  A health maintenance organization may invest in student loans insured or guaranteed as to principal by the Government of the United States, or by any agency or instrumentality of the Government of the United States, to the extent of such insurance or guaranty.

(c)  State public obligations.--A health maintenance organization may invest in bonds, notes, warrants, and other securities not in default which are the direct obligations of any state of the United States or the District of Columbia, or for which the full faith and credit of such state or district has been pledged for the payment of principal and interest.

(d)  County, municipal, and district obligations.--A health maintenance organization may invest in bonds, notes, warrants, and other securities not in default of any county, district, incorporated city, or school district in any state of the United States or the District of Columbia, which are the direct obligations of such county, district, city, or school district and for payment of the principal and interest of which the county, district, city, or school district has lawful authority to levy taxes or make assessments.

(e)  Public improvement bonds.--A health maintenance organization may invest in bonds, notes, certificates of indebtedness, warrants, or other evidences of indebtedness which are payable from revenues or earnings specifically pledged therefor of any public toll bridge, structure, or improvement owned by any state, incorporated city, or legally constituted public corporation or commission, all within the United States, for the payment of the principal and interest of which a lawful sinking fund has been established and is being maintained if no default on the part of the issuer in payment of principal or interest has occurred on any of its bonds, notes, warrants, or other securities within 5 years prior to the date of investment therein.

(f)  Public utility obligations.--The health maintenance organization may invest in the bonds, notes, certificates of indebtedness, warrants, or other evidences of indebtedness which are valid obligations issued, assumed, or guaranteed by the United States or any state thereof or by any county, municipal corporation, district, political subdivision, civil division, or public instrumentality of any such government or unit thereof, if by statute or other legal requirements such obligations are payable as to both principal and interest from revenues or earnings from the whole or any part of any utility supplying water, gas, sewage disposal, electricity, or any other public service, including, but not limited to, a toll road or toll bridge.

(g)  Securities of certain agencies.--The health maintenance organization may invest in bonds, debentures, or other securities of the following agencies, whether or not such obligations are guaranteed by the Government of the United States:

1.  The Federal National Mortgage Association, and stock thereof, when acquired in connection with the sale of mortgage loans to such association.

2.  Any federal land bank, when such securities are issued under provisions of the Act of Congress entitled the "Federal Farm Loan Act" and approved July 17, 1916, and any acts amendatory or supplementary to that act.

3.  Any federal home loan bank, when such securities are issued under provisions of the Act of Congress entitled the "Federal Home Loan Bank Act" and approved July 22, 1932.

4.  The Home Owners' Loan Corporation, created by the Act of Congress entitled "Home Owners' Loan Act of 1933" and approved June 13, 1933.

5.  Any federal intermediate credit bank, created by the Act of Congress entitled "Agricultural Credits Act of March 4, 1923."

6.  The Central Bank for Cooperatives and regional banks for cooperatives organized under the Farm Credit Act of 1933, or by any of such banks; and any notes, bonds, debentures, or other similar obligations, consolidated or otherwise, issued by farm credit institutions pursuant to the Farm Credit Act of 1971, Pub. L. No. 92-181.

7.  Any other similar agency of the Government of the United States which is of similar financial quality.

(h)  Public housing obligations.--The health maintenance organization may invest in the bonds, debentures, or other securities of public housing authorities, issued under the provisions of the Act of Congress entitled the "Housing Act of 1949" and approved July 1949, the "Municipal Housing Commission Act," or the "Rural Housing Commission Act," and any additional amendments, or issued by any public housing authority or agency in the United States, if such bonds, debentures, or other securities are secured by a pledge of annual contributions to be paid by the United States or any agency thereof.

(i)  Obligations of State Board of Education.--The health maintenance organization may invest in bonds or motor vehicle anticipation certificates issued by the State Board of Education under authority of s. 18, Art. XII of the State Constitution of 1885 as adopted by s. 9(d), Art. XII of the State Constitution, 1968 Revision, and the additional provisions of s. 9(d) thereof.

(j)  Corporate bonds and debentures.--A health maintenance organization may invest in bonds, notes, or other interest-bearing or interest-accruing obligations of any solvent corporation organized under the laws of the United States or any state, territory, or possession of the United States, including the District of Columbia, but such investment must be in securities of investment grade and may not exceed 10 percent of admitted assets for any one corporate entity. As used in this paragraph, "investment grade" means that the obligation has been determined to be in one of the top two rating classifications used by the Securities Valuation Office of the National Association of Insurance Commissioners.

(14)  SPECIAL LIMITATION INVESTMENTS.--

(a)  After satisfying the requirements of this part, any funds of the health maintenance organization may be invested in the following investments, subject to a cost limitation of 10 percent of its admitted assets in each category of investment:

1.  Anticipation obligations of political subdivisions of a state.--Anticipation obligations of any political subdivision of any state of the United States, including, but not limited to, bond anticipation notes, tax anticipation notes, preliminary loan anticipation notes, revenue anticipation notes, and construction anticipation notes, for the payment of money within 12 months from the issuance of the obligation, on the following conditions:

a.  The anticipation notes are a direct obligation of the issuer under conditions set forth in subsection (9).

b.  The political subdivision is not in default in the payment of the principal or interest on any of its direct general obligations or any obligation guaranteed by such political subdivision.

c.  The anticipated funds are specifically pledged to secure the obligations.

2.  Revenue obligations of state or municipal public utilities.--Obligations of any state of the United States, a political subdivision thereof, or a public instrumentality of any one or more of the foregoing for the payment of money, on the following conditions:

a.  The obligations are payable from revenues or earnings of a public utility of such state, political subdivision, or public instrumentality which are specifically pledged therefor.

b.  The law under which the obligations are issued requires that such rates for service shall be charged and collected at all times so as to produce sufficient revenue or earning, together with any other revenues or moneys pledged, to pay all operating and maintenance charges of the public utility and all principal and interest on such charges.

c.  No prior or parity obligations payable from the revenues or earnings of that public utility are in default at the date of such investment.

3.  Other revenue obligations.--Obligations of any state of the United States, a political subdivision thereof, or a public instrumentality of any of the foregoing for the payment of money, on the following conditions:

a.  The obligations are payable from revenues or earnings, excluding revenues or earnings from public utilities, specifically pledged therefor by such state, political subdivision, or public instrumentality.

b.  No prior or parity obligation of the same issuer payable from revenues or earnings from the same source has been in default as to principal or interest during the 5 years next preceding the date of the investment, but the issuer need not have been in existence for that period, and obligations acquired under this paragraph may be newly issued.

4.  Corporate stocks.--Stocks, common or preferred, of any corporation created or existing under the laws of the United States or any state thereof. The organization may invest in stocks, common or preferred, of any corporation created or existing under the laws of any foreign country if such stocks are listed and traded on a national securities exchange in the United States or, in the alternative, if such investment in stocks of any corporation created or existing under the laws of any foreign country are first approved by the department. Investment in common stock of any one corporation shall not exceed 3 percent of the health maintenance organization's admitted assets.

(b)  After satisfying the requirements of this part, the health maintenance organization may invest its funds and accumulations in the following investments, subject to a cost limitation of 5 percent of admitted assets in each category of investment:

1.  Obligations of the International Bank for Reconstruction and Development.--Obligations issued or guaranteed by the International Bank for Reconstruction and Development.

2.  Obligations of the Inter-American Development Bank.--Obligations issued or guaranteed by the Inter-American Development Bank.

3.  Obligations of the Asian Development Bank.--Obligations issued or guaranteed by the Asian Development Bank.

4.  Obligations of the State of Israel.--Direct obligations of the State of Israel for the payment of money, or obligations for the payment of money which are guaranteed as to the payment of principal and interest by the State of Israel, on the condition that the State of Israel shall not be in default in the payment of principal or interest on any of its direct, general obligations on the date of such investment.

5.  Obligations of the African Development Bank.--Obligations issued or guaranteed by the African Development Bank.

6.  Obligations of the Government of Canada or any province thereof.--Obligations issued or guaranteed by the Government of Canada or any province thereof.

7.  Obligations of the International Finance Corporation.--Obligations issued or guaranteed by the International Finance Corporation.

(15)  SPECIAL CONSENT INVESTMENT.--Any investment of the health maintenance organization's funds not enumerated in this part requires the prior approval of the department.

(16)  PROHIBITED INVESTMENTS AND INVESTMENT UNDERWRITING.--

(a)  In addition to investments excluded pursuant to other provisions of this act, a health maintenance organization shall not directly or indirectly invest in or lend its funds upon the security of:

1.  Issued shares of its own capital stock, except in connection with a plan approved by the department for purchase of the shares by the organization's officers, employees, or agents. However, no such stock shall constitute an asset of the organization in any determination of its financial condition.

2.  Except with the consent of the department, securities issued by any corporation or enterprise the controlling interest of which is, or will after such acquisition by the organization be, held directly or indirectly by the organization or any combination of the organization and its directors, officers, parent corporation, subsidiaries, or controlling stockholders. Investments in health care providers under subsections (11) and (12) shall not be subject to this provision.

3.  Any note or other evidence of indebtedness of any director, officer, or controlling stockholder of the health maintenance organization.

(b)  No health maintenance organization shall underwrite or participate in the underwriting of an offering of securities or property by any other person.

(17)  TIME LIMIT FOR DISPOSAL OF INELIGIBLE PROPERTY AND SECURITIES; EFFECT OF FAILURE TO DISPOSE.--

(a)  Any property or securities lawfully acquired by a health maintenance organization which it could not otherwise have invested in or loaned its funds upon at the time of such acquisition shall be disposed of within 6 months from the date of acquisition, unless within such period the security has attained to the standard of eligibility; except that any security or property acquired under any agreement of merger or consolidation may be retained for a longer period if so provided in the plan for such merger or consolidation, as approved by the department. Upon application by the organization and proof to the department that forced sale of any such property or security would materially injure the interests of the health maintenance organization, the department shall extend the disposal period for an additional reasonable time.

(b)  Notwithstanding the provisions of paragraph (a), any ineligible property or securities shall not be allowed as an asset of the organization.

(18)  The provisions of this section supersede any inconsistent provision of s. 106 of the Secondary Mortgage Market Enhancement Act of 1984 (15 U.S.C. s. 77r).

History.--s. 19, ch. 72-264; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 799, 804, 809(1st), ch. 82-243; s. 33, ch. 85-177; s. 18, ch. 88-388; s. 76, ch. 89-360; ss. 126, 184, 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.36  Adoption of rules; penalty for violation.--The department shall adopt rules necessary to carry out the provisions of this part. The department shall collect and make available all health maintenance organization rules adopted by the department. Any violation of a rule adopted under this section shall subject the violating entity to the provisions of s. 641.23.

History.--s. 20, ch. 72-264; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 800, 804, 809(1st), ch. 82-243; s. 12, ch. 87-236; ss. 127, 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.365  Dividends.--

(1)  A health maintenance organization shall not pay any dividend or distribute cash or other property to stockholders except out of that part of its available and accumulated surplus funds which is derived from realized net operating profits on its business and net realized capital gains. Dividend payments or distributions to stockholders shall not exceed 10 percent of such surplus in any one year unless otherwise approved by the department. In addition to such limited payments, a health maintenance organization may make dividend payments or distributions out of the health maintenance organization's entire net operating profits and realized net capital gains derived during the immediately preceding calendar or fiscal year, as applicable.

(2)  The department shall not approve a dividend or distribution in excess of the maximum amount allowed in subsection (1) unless it determines that the distribution or dividend would not jeopardize the financial condition of the health maintenance organization.

(3)  Any director of a health maintenance organization who knowingly votes for or concurs in declaration or payment of a dividend to stockholders when such declaration is in violation of this section is guilty of a misdemeanor of the second degree, punishable as provided in s. 775.082 or s. 775.083, and shall be jointly and severally liable, together with other such directors likewise voting for or concurring, for any loss thereby sustained by creditors of the health maintenance organization to the extent of such dividend.

(4)  Any stockholder receiving such an illegal dividend shall be liable in the amount thereof to the health maintenance organization.

(5)  The department may revoke or suspend the certificate of authority of a health maintenance organization which has declared or paid such an illegal dividend.

History.--ss. 19, 24, ch. 88-388; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.37  Prohibited activities; penalties.--

(1)  Any person or entity which knowingly renews, issues, or delivers any health maintenance contract without first obtaining and thereafter maintaining a certificate of authority is guilty of a felony of the third degree, punishable as provided in s. 775.082 or s. 775.083.

(2)  Except as provided in subsection (1), any person, entity, or health maintenance organization which knowingly violates the provisions of this part is guilty of a misdemeanor of the first degree, punishable as provided in s. 775.082 or s. 775.083.

(3)  Any agent or representative, solicitor, examining physician, applicant, or other person who knowingly makes any false and fraudulent statements or representation in, or with reference to, any application or negotiation for health maintenance organization coverage is, in addition to any other penalty provided by law, guilty of a misdemeanor of the first degree, punishable as provided in s. 775.082 or s. 775.083.

(4)  Any agent, representative, solicitor, collector, or other person who, while acting on behalf of a health maintenance organization, receives or collects its funds or premium payments and fails to satisfactorily account for or turn over, when required, all such funds or payments is, in addition to the other penalties provided for by law, guilty of a misdemeanor of the second degree, punishable as provided in s. 775.082 or s. 775.083.

(5)  Any person who, without authority granted by a health maintenance organization, collects or secures cash advances, premium payments, or other funds owing to the health maintenance organization or otherwise conducts the business of a health maintenance organization without its authority is, in addition to the other penalties provided for by law, guilty of a misdemeanor of the second degree, punishable as provided in s. 775.082 or s. 775.083.

History.--s. 21, ch. 72-264; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 801, 804, 809(1st), ch. 82-243; s. 34, ch. 85-177; s. 52, ch. 87-226; ss. 187, 188, ch. 91-108; s. 164, ch. 91-224; s. 4, ch. 91-429; s. 26, ch. 96-199.

641.38  Operational health maintenance organizations; issuance of certificate.--The provisions of this part do not apply to those organizations providing the services defined in ss. 641.17-641.38 which have been continuously engaged in providing such services since January 1, 1947. This exemption shall terminate upon a change in controlling ownership of the organization.

History.--s. 23, ch. 72-264; s. 3, ch. 76-168; s. 1, ch. 77-457; ss. 2, 3, ch. 81-318; ss. 802, 804, 809(1st), ch. 82-243; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.385  Order to discontinue certain advertising.--If in the opinion of the department any advertisement by a health maintenance organization violates any of the provisions of this part, the department may enter an immediate order requiring that the use of the advertisement be discontinued. If requested by the health maintenance organization, the department shall conduct a hearing within 10 days of the entry of such order. If, after the hearing or by agreement with the health maintenance organization, a final determination is made that the advertising was in fact violative of any provision of this part, the department may, in lieu of revocation of the certificate of authority, require the publication of a corrective advertisement; impose an administrative penalty of up to $10,000; and, in the case of an initial solicitation, require that the health maintenance organization, prior to accepting any application received in response to the advertisement, provide an acceptable clarification of the advertisement to each individual applicant.

History.--s. 8, ch. 84-313; s. 188, ch. 91-108; s. 4, ch. 91-429.

641.386  Agent licensing and appointment required; exceptions.--

(1)  With respect to a health maintenance contract, no person shall, unless licensed and appointed as a health insurance agent in accordance with the applicable provisions of the Florida Insurance Code:

(a)  Solicit contracts or procure applications; or

(b)  Engage or hold himself or herself out as engaging in the business of analyzing or abstracting health maintenance contracts or of counseling or advising or giving opinions to persons relative to such contracts other than as a consulting actuary advising a health maintenance organization or as a salaried bona fide full-time employee so counseling and advising his or her employer relative to coverage for the employer and his or her employees.

(2)  All qualifications, disciplinary provisions, licensing and appointment procedures, fees, and related matters contained in the Florida Insurance Code which apply to the licensing and appointment of health insurance agents by insurers shall apply to health maintenance organizations and to persons licensed or appointed by the health maintenance organization as their agents.

(3)  An examination, license, or appointment is not required of any regular salaried officer or employee of a health maintenance organization who devotes substantially all of his or her services to activities other than the solicitation of health maintenance organization contracts from the public and who receives no commission or other compensation directly dependent upon the solicitation of such contracts. This exemption does not apply to the solicitation of Medicaid eligible subscribers.

(4)  All agents and health maintenance organizations shall comply with and be subject to the applicable provisions of ss. 641.309 and 409.912(18), and all companies and entities appointing agents shall comply with s. 626.451, when marketing for any health maintenance organization licensed pursuant to this part, including those organizations under contract with the Agency for Health Care Administration to provide health care services to Medicaid recipients or any private entity providing health care services to Medicaid recipients pursuant to a prepaid health plan contract with the Agency for Health Care Administration.

History.--ss. 77, 80, ch. 89-360; ss. 176, 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 27, ch. 96-199; s. 1753, ch. 97-102.

641.3901  Unfair methods of competition and unfair or deceptive acts or practices prohibited.--No person, entity, or health maintenance organization shall engage in this state in any trade practice which is defined in this part as, or determined pursuant to s. 641.3905 to be, an unfair method of competition or an unfair or deceptive act or practice involving the business of health maintenance organizations.

History.--ss. 35, 47, ch. 85-177; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.3903  Unfair methods of competition and unfair or deceptive acts or practices defined.--The following are defined as unfair methods of competition and unfair or deceptive acts or practices:

(1)  MISREPRESENTATION AND FALSE ADVERTISING OF HEALTH MAINTENANCE CONTRACTS.--Knowingly making, issuing, or circulating, or causing to be made, issued, or circulated, any estimate, illustration, circular, statement, sales presentation, omission, or comparison which:

(a)  Misrepresents the benefits, advantages, conditions, or terms of any health maintenance contract.

(b)  Is misleading, or is a misrepresentation as to the financial condition of any person.

(c)  Uses any name or title of any contract misrepresenting the true nature thereof.

(d)  Is a misrepresentation for the purpose of inducing, or tending to induce, the lapse, forfeiture, exchange, conversion, or surrender of any health maintenance contract or health insurance policy, or contract providing health insurance as defined in s. 624.603.

(e)  Misrepresents the benefits, nature, characteristics, uses, standard, quantity, quality, cost, rate, scope, source, or geographic origin or location of any goods or services available from or provided by, directly or indirectly, any health maintenance organization.

(f)  Misrepresents the affiliation, connection, or association of any goods, services, or business establishment.

(g)  Advertises goods or services with intent not to sell them as advertised.

(h)  Disparages the goods, services, or business of another person by any false or misleading representation.

(i)  Misrepresents the sponsorship, endorsement, approval, or certification of goods or services.

(j)  Uses an advertising format which, by virtue of the design, location, or size of printed matter, is deceptive or misleading or which would be deceptive or misleading to any reasonable person.

(k)  Offers to provide a service which the health maintenance organization is unable to provide.

(l)  Misrepresents the availability of a service provided by the health maintenance organization, either directly or indirectly, including the availability of the service as to location.

(2)  FALSE INFORMATION AND ADVERTISING GENERALLY.--Knowingly making, publishing, disseminating, circulating, or placing before the public, or causing, directly or indirectly, to be made, published, disseminated, circulated, or placed before the public:

(a)  In a newspaper, magazine, or other publication;

(b)  In the form of a notice, circular, pamphlet, letter, or poster;

(c)  Over any radio or television station; or

(d)  In any other way,

an advertisement, announcement, or statement containing any assertion, representation, or statement with respect to the business of the health maintenance organization which is untrue, deceptive, or misleading.

(3)  DEFAMATION.--Knowingly making, publishing, disseminating, or circulating, directly or indirectly, or aiding, abetting, or encouraging the making, publishing, disseminating, or circulating of, any oral or written statement, or any pamphlet, circular, article, or literature, which is false or maliciously critical of any person and which is calculated to injure such person.

(4)  FALSE STATEMENTS AND ENTRIES.--

(a)  Knowingly:

1.  Filing with any supervisory or other public official,

2.  Making, publishing, disseminating, or circulating,

3.  Delivering to any person,

4.  Placing before the public, or

5.  Causing, directly or indirectly, to be made, published, disseminated, circulated, or delivered to any person, or place before the public,

any material false statement.

(b)  Knowingly making any false entry of a material fact in any book, report, or statement of any person.

(5)  UNFAIR CLAIM SETTLEMENT PRACTICES.--

(a)  Attempting to settle claims on the basis of an application or any other material document which was altered without notice to, or knowledge or consent of, the subscriber or group of subscribers to a health maintenance organization;

(b)  Making a material misrepresentation to the subscriber for the purpose and with the intent of effecting settlement of claims, loss, or damage under a health maintenance contract on less favorable terms than those provided in, and contemplated by, the contract; or

(c)  Committing or performing with such frequency as to indicate a general business practice any of the following:

1.  Failing to adopt and implement standards for the proper investigation of claims;

2.  Misrepresenting pertinent facts or contract provisions relating to coverage at issue;

3.  Failing to acknowledge and act promptly upon communications with respect to claims;

4.  Denying of claims without conducting reasonable investigations based upon available information;

5.  Failing to affirm or deny coverage of claims upon written request of the subscriber within a reasonable time not to exceed 30 days after a claim or proof-of-loss statements have been completed and documents pertinent to the claim have been requested in a timely manner and received by the health maintenance organization;

6.  Failing to promptly provide a reasonable explanation in writing to the subscriber of the basis in the health maintenance contract in relation to the facts or applicable law for denial of a claim or for the offer of a compromise settlement;

7.  Failing to provide, upon written request of a subscriber, itemized statements verifying that services and supplies were furnished, where such statement is necessary for the submission of other insurance claims covered by individual specified disease or limited benefit policies, provided that the organization may receive from the subscriber a reasonable administrative charge for the cost of preparing such statement; or

8.  Failing to provide any subscriber with services, care, or treatment contracted for pursuant to any health maintenance contract without a reasonable basis to believe that a legitimate defense exists for not providing such services, care, or treatment. To the extent that a national disaster, war, riot, civil insurrection, epidemic, or any other emergency or similar event not within the control of the health maintenance organization results in the inability of the facilities, personnel, or financial resources of the health maintenance organization to provide or arrange for provision of a health service in accordance with requirements of this part, the health maintenance organization is required only to make a good faith effort to provide or arrange for provision of the service, taking into account the impact of the event. For the purposes of this paragraph, an event is not within the control of the health maintenance organization if the health maintenance organization cannot exercise influence or dominion over its occurrence.

(6)  FAILURE TO MAINTAIN COMPLAINT-HANDLING PROCEDURES.--Failure of any person to maintain a complete record of all the complaints received since the date of the most recent examination of the health maintenance organization by the department. For the purposes of this subsection, the term "complaint" means any written communication primarily expressing a grievance and requesting a remedy to the grievance.

(7)  OPERATION WITHOUT A SUBSISTING CERTIFICATE OF AUTHORITY.--Operation of a health maintenance organization by any person or entity without a subsisting certificate of authority therefor or renewal, issuance, or delivery of any health maintenance contract by a health maintenance organization, person, or entity without a subsisting certificate of authority.

(8)  MISREPRESENTATION IN HEALTH MAINTENANCE ORGANIZATION APPLICATIONS.--Knowingly making false or fraudulent statements or representations on, or relative to, an application for a health maintenance contract for the purpose of obtaining a fee, commission, money, or other benefits from any health maintenance organization; agent; or representative, broker, or individual.

(9)  TWISTING.--Knowingly making any misleading representations or incomplete or fraudulent comparisons of any health maintenance contracts or health maintenance organizations or of any insurance policies or insurers for the purpose of inducing, or intending to induce, any person to lapse, forfeit, surrender, terminate, retain, pledge, assign, borrow on, or convert any insurance policy or health maintenance contract or to take out a health maintenance contract or policy of insurance in another health maintenance organization or insurer.

(10)  ILLEGAL DEALINGS IN PREMIUMS; EXCESS OR REDUCED CHARGES FOR HEALTH MAINTENANCE COVERAGE.--

(a)  Knowingly collecting any sum as a premium or charge for health maintenance coverage which is not then provided or is not in due course to be provided, subject to acceptance of the risk by the health maintenance organization, by a health maintenance contract issued by a health maintenance organization as permitted by this part.

(b)  Knowingly collecting as a premium or charge for health maintenance coverage any sum in excess of or less than the premium or charge applicable to health maintenance coverage, in accordance with the applicable classifications and rates as filed with the department, and as specified in the health maintenance contract.

(11)  FALSE CLAIMS; OBTAINING OR RETAINING MONEY DISHONESTLY.--Any agent or representative, physician, claimant, or other person who causes to be presented to any health maintenance organization a false claim for payment knowing the same to be false.

(12)  PROHIBITED DISCRIMINATORY PRACTICES.--A health maintenance organization may not:

(a)  Engage or attempt to engage in discriminatory practices that discourage participation on the basis of actual or perceived health status of Medicaid recipients.

(b)  Refuse to provide services or care to a subscriber solely because medical services may be or have been sought for injuries resulting from an assault, battery, sexual assault, sexual battery, or any other offense by a family or household member, as defined in s. 741.28(2), or by another who is or was residing in the same dwelling unit.

(13)  MISREPRESENTATION IN HEALTH MAINTENANCE ORGANIZATION; AVAILABILITY OF PROVIDERS.--Knowingly misleading potential enrollees as to the availability of providers.

¹(14)  ADVERSE ACTION AGAINST A PROVIDER.--Any retaliatory action by a health maintenance organization against a contracted provider, including, but not limited to, termination of a contract with the provider, on the basis that the provider communicated information to the provider's patient regarding medical care or treatment options for the patient when the provider deems knowledge of such information by the patient to be in the best interest of the patient.

History.--ss. 36, 47, ch. 85-177; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 28, ch. 96-199; s. 6, ch. 96-223; s. 1, ch. 99-264.

¹Note.--Section 6, ch. 99-264, provides that "[t]his act shall take effect [June 8, 1999] and shall apply only to contracts entered into after the effective date."

641.3905  General powers and duties of the department.--In addition to the powers and duties set forth in s. 624.307, the department shall have the power to examine and investigate the affairs of every person, entity, or health maintenance organization in order to determine whether the person, entity, or health maintenance organization is operating in accordance with the provisions of this part or has been or is engaged in any unfair method of competition or in any unfair or deceptive act or practice prohibited by s. 641.3901.

History.--ss. 37, 47, ch. 85-177; ss. 128, 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.3907  Defined unfair practices; hearings, witnesses, appearances, production of books, and service of process.--

(1)  Whenever the department has reason to believe that any person, entity, or health maintenance organization has engaged, or is engaging, in this state in any unfair method of competition or any unfair or deceptive act or practice as defined in s. 641.3903 or is operating a health maintenance organization without a certificate of authority as required by this part and that a proceeding by it in respect thereto would be to the interest of the public, the department shall conduct or cause to have conducted a hearing in accordance with chapter 120.

(2)  The department, a duly empowered hearing officer, or an administrative law judge shall, during the conduct of such hearing, have those powers enumerated in s. 120.569; however, the penalties for failure to comply with a subpoena or with an order directing discovery shall be limited to a fine not to exceed $1,000 per violation.

(3)  Statements of charges, notices, and orders under this part may be served by anyone duly authorized by the department, either in the manner provided by law for service of process in civil actions or by certifying and mailing a copy thereof to the person, entity, or health maintenance organization affected by the statement, notice, order, or other process at her or his or its residence or principal office or place of business. The verified return by the person so serving such statement, notice, order, or other process, setting forth the manner of the service, shall be proof of the same, and the return postcard receipt for such statement, notice, order, or other process, certified and mailed as aforesaid, shall be proof of service of the same.

History.--ss. 38, 47, ch. 85-177; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 285, ch. 96-410; s. 1754, ch. 97-102.

641.3909  Cease and desist and penalty orders.--After the hearing provided in s. 641.3907, the department shall enter a final order in accordance with s. 120.569. If it is determined that the person, entity, or health maintenance organization charged has engaged in an unfair or deceptive act or practice or the unlawful operation of a health maintenance organization without a subsisting certificate of authority, the department shall also issue an order requiring the violator to cease and desist from engaging in such method of competition, act, or practice or unlawful operation of a health maintenance organization. Further, if the act or practice constitutes a violation of s. 641.3901 or s. 641.3903, the department may, at its discretion, order any one or more of the following:

(1)  Suspension or revocation of the health maintenance organization's certificate of authority if it knew, or reasonably should have known, it was in violation of this part.

(2)  If it is determined that the person or entity charged has engaged in the business of operating a health maintenance organization without a certificate of authority, an administrative penalty not to exceed $1,000 for each health maintenance contract offered or effectuated.

History.--ss. 39, 47, ch. 85-177; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 286, ch. 96-410.

641.3911  Appeals from the department.--Any person, entity, or health maintenance organization subject to an order of the department under s. 641.3909 or s. 641.3913 may obtain a review of the order by filing an appeal therefrom in accordance with the provisions and procedures for appeal under s. 120.68.

History.--ss. 40, 47, ch. 85-177; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.3913  Penalty for violation of cease and desist orders.--Any person, entity, or health maintenance organization which violates a cease and desist order of the department under s. 641.3909 while such order is in effect, after notice and hearing as provided in s. 641.3907, shall be subject, at the discretion of the department, to any one or more of the following:

(1)  A monetary penalty of not more than $200,000 as to all matters determined in such hearing.

(2)  Suspension or revocation of the health maintenance organization's certificate of authority.

History.--ss. 41, 47, ch. 85-177; s. 20, ch. 88-388; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

¹641.3915  Health maintenance organization anti-fraud plans and investigative units.--Each authorized health maintenance organization and applicant for a certificate of authority shall comply with the provisions of ss. 626.989 and 626.9891 as though such organization or applicant were an authorized insurer. For purposes of this section, the reference to the year 1996 in s. 626.9891 means the year 2000 and the reference to the year 1995 means the year 1999.

History.--s. 4, ch. 99-204.

¹Note.--Section 16, ch. 99-204, provides that "[t]his act shall take effect October 1, 1999, and shall apply to policies and contracts issued or renewed on or after that date."

641.3917  Civil liability.--The provisions of this part are cumulative to rights under the general civil and common law, and no action of the department shall abrogate such rights to damage or other relief in any court.

History.--ss. 42, 47, ch. 85-177; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.3921  Conversion on termination of eligibility.--A group health maintenance contract delivered or issued for delivery in this state by a health maintenance organization shall provide that a subscriber or covered dependent whose coverage under the group health maintenance contract has been terminated for any reason, including discontinuance of the group health maintenance contract in its entirety or with respect to a covered class, and who has been continuously covered under the group health maintenance contract, and under any group health maintenance contract providing similar benefits which it replaces, for at least 3 months immediately prior to termination, shall be entitled to have issued to him or her by the health maintenance organization a health maintenance contract, hereafter referred to as a "converted contract." A subscriber or covered dependent shall not be entitled to have a converted contract issued to him or her if termination of his or her coverage under the group health maintenance contract occurred for any of the following reasons:

(1)  Failure to pay any required premium or contribution unless such nonpayment of premium was due to acts of an employer or person other than the individual;

(2)  Replacement of any discontinued group coverage by similar group coverage within 31 days;

(3)  Fraud or material misrepresentation in applying for any benefits under the health maintenance contract;

(4)  Disenrollment for cause. When the requirements of paragraphs (a), (b), and (c) have been met, a health maintenance organization may disenroll a subscriber for cause if the subscriber's behavior is disruptive, unruly, abusive, or uncooperative to the extent that his or her continuing membership in the organization seriously impairs the organization's ability to furnish services to either the subscriber or other subscribers.

(a)  Effort to resolve the problem. The organization must make a serious effort to resolve the problem presented by the subscriber, including the use or attempted use of subscriber grievance procedures.

(b)  Consideration of extenuating circumstances. The organization must ascertain that the subscriber's behavior does not directly result from an existing medical condition.

(c)  Documentation. The organization must document the problems, efforts, and medical conditions as described in this subsection;

(5)  Willful and knowing misuse of the health maintenance organization identification membership card by the subscriber;

(6)  Willful and knowing furnishing to the organization by the subscriber of incorrect or incomplete information for the purpose of fraudulently obtaining coverage or benefits from the organization; or

(7)  The subscriber has left the geographic area of the health maintenance organization with the intent to relocate or establish a new residence outside the organization's geographic area.

History.--ss. 43, 47, ch. 85-177; s. 21, ch. 88-388; ss. 129, 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 490, ch. 97-102; s. 29, ch. 97-179.

641.3922  Conversion contracts; conditions.--Issuance of a converted contract shall be subject to the following conditions:

¹(1)  TIME LIMIT.--Written application for the converted contract shall be made and the first premium paid to the health maintenance organization not later than 63 days after such termination. However, if termination was the result of failure to pay any required premium or contribution and such nonpayment of premium was due to acts of an employer or group contract holder other than the employee or individual subscriber, written application for the contract must be made and the first premium must be paid not later than 63 days after notice of termination is mailed by the organization or the employer, whichever is earlier, to the employee's or individual's last address as shown by the record of the organization or the employer, whichever is applicable. In such case of termination due to nonpayment of premium by the employer or group contract holder, the premium for the converted contract may not exceed the rate for the prior group coverage for the period of coverage under the converted contract prior to the date notice of termination is mailed to the employee or individual subscriber. For the period of coverage after such date, the premium for the converted contract is subject to the requirements of subsection (3).

(2)  EVIDENCE OF INSURABILITY.--The converted contract shall be issued without evidence of insurability.

(3)  CONVERSION PREMIUM.--The premium for the converted contract shall be determined in accordance with premium rates applicable to the age and class of risk of each person to be covered under the converted contract and to the type and amount of coverage provided. However, the premium for the converted contract may not exceed 200 percent of the standard risk rate, as established by the department under s. 627.6675(3). The mode of payment for the converted contract shall be quarterly or more frequently at the option of the organization, unless otherwise mutually agreed upon between the subscriber and the organization.

(4)  EFFECTIVE DATE OF COVERAGE.--The effective date of the converted contract shall be the day following the termination of coverage under the group health maintenance contract. However, until application is made and the first premium is paid, the health maintenance organization may charge the subscriber, on a fee-for-service basis, for any services rendered to the subscriber after the date in which the subscriber ceases to be eligible under the group health maintenance contract. When application is made and the first premium is paid, the organization shall reimburse the subscriber for any payment made by the subscriber for covered services under the converted contract.

(5)  SCOPE OF COVERAGE.--The converted contract shall cover the subscriber or dependents who were covered by the group health maintenance contract on the date of termination of coverage. At the option of the health maintenance organization, a separate converted contract may be issued to cover any dependent.

(6)  OPTIONAL COVERAGE.--The health maintenance organization shall not be required to issue a converted contract covering any person if such person is or could be covered by Medicare, Title XVIII of the Social Security Act, as added by the Social Security Amendments of 1965, or as later amended or superseded. Furthermore, the health maintenance organization shall not be required to issue a converted health maintenance contract covering any person if:

(a)1.  The person is covered for similar benefits by another hospital, surgical, medical, or major medical expense insurance policy or hospital or medical service subscriber contract or medical practice or other prepayment plan or by any other plan or program;

2.  The person is eligible for similar benefits, whether or not covered therefor, under any arrangement of coverage for individuals in a group, whether on an insured or uninsured basis; or

3.  Similar benefits are provided for or are available to the person pursuant to or in accordance with the requirements of any state or federal law; and

(b)  A converted health maintenance contract may include a provision whereby the health maintenance organization may request information, in advance of any premium due date of a health maintenance contract, of any person covered thereunder as to whether:

1.  She or he is covered for similar benefits by another hospital, surgical, medical, or major medical expense insurance policy or hospital or medical service subscriber contract or medical practice or other prepayment plan or by any other plan or program;

2.  She or he is covered for similar benefits under any arrangement of coverage for individuals in a group, whether on an insured or uninsured basis; or

3.  Similar benefits are provided for or are available to the person pursuant to or in accordance with the requirements of any state or federal law.

(7)  REASONS FOR CANCELLATION; TERMINATION.--The converted health maintenance contract must contain a cancellation or nonrenewability clause providing that the health maintenance organization may refuse to renew the contract of any person covered thereunder, but cancellation or nonrenewal must be limited to one or more of the following reasons:

(a)  Fraud or intentional misrepresentation, subject to the limitations of s. 641.31(23), in applying for any benefits under the converted health maintenance contract;

(b)  Disenrollment for cause, after following the procedures outlined in s. 641.3921(4).

(c)  Willful and knowing misuse of the health maintenance organization identification membership card by the subscriber or the willful and knowing furnishing to the organization by the subscriber of incorrect or incomplete information for the purpose of fraudulently obtaining coverage or benefits from the organization.

(d)  Failure, after notice, to pay required premiums.

(e)  The subscriber has left the geographic area of the health maintenance organization with the intent to relocate or establish a new residence outside the organization's geographic area.

(f)  A dependent of the subscriber has reached the limiting age under the converted contract, subject to subsection (12); but the refusal to renew coverage shall apply only to coverage of the dependent, except in the case of handicapped children.

(g)  A change in marital status that makes a person ineligible under the original terms of the converted contract, subject to subsection (12).

(8)  BENEFITS OFFERED.--A health maintenance organization shall not be required to issue a converted contract which provides benefits in excess of those provided under the group health maintenance contract from which conversion is made. The converted health maintenance contract shall meet the requirements of law pertaining to health maintenance contracts and shall include a level of benefits for minimum services which is substantially similar to the level of benefits for these services included in the group health maintenance organization contract from which the termination is made.

(9)  PREEXISTING CONDITION PROVISION.--The converted health maintenance contract shall not exclude a preexisting condition not excluded by the group contract. However, the converted health maintenance contract may provide that any coverage benefits thereunder may be reduced by the amount of any coverage or benefits under the group health maintenance contract after the termination of the person's coverage or benefits thereunder. The converted health maintenance contract may also include provisions so that during the first coverage year the coverage or benefits under the converted contract, together with the coverage or benefits under the group health maintenance contract, shall not exceed those that would have been provided had the individual's coverage or benefits under the group contract remained in force and effect.

(10)  ALTERNATE PLANS.--The health maintenance organization shall offer a standard health benefit plan as established pursuant to s. 627.6699(12). The health maintenance organization may, at its option, also offer alternative plans for group health conversion in addition to those required by this section, provided any alternative plan is approved by the department or is a converted policy, approved under s. 627.6675 and issued by an insurance company authorized to transact insurance in this state. Approval by the department of an alternative plan shall be based on compliance by the alternative plan with the provisions of this part and the rules promulgated thereunder, applicable provisions of the Florida Insurance Code and rules promulgated thereunder, and any other applicable law.

(11)  RETIREMENT COVERAGE.--In the event that coverage would be continued under the group health maintenance contract on an employee following the employee's retirement prior to the time she or he is or could be covered by Medicare, the employee may elect, in lieu of such continuation of group coverage, to have the same conversion rights as would apply had her or his coverage terminated at retirement by reason of termination of employment or membership.

(12)  CONVERSION PRIVILEGE ALLOWED.--Subject to the conditions set forth above, the conversion privilege shall also be available:

(a)  To the surviving spouse, if any, at the death of the subscriber, with respect to the spouse and such children whose coverages under the group health maintenance contract terminate by reason of such death, otherwise to each surviving child whose coverage under the group health maintenance contract terminates by reason of such death or, if the group contract provides for continuation of dependents' coverages following the subscriber's death, at the end of such continuation;

(b)  To the former spouse whose coverage would otherwise terminate because of annulment or dissolution of marriage, if the former spouse is dependent for financial support;

(c)  To the spouse of the subscriber upon termination of coverage of the spouse, while the subscriber remains covered under the group health maintenance contract, by reason of ceasing to be a qualified family member under the group health maintenance contract, with respect to the spouse and such children whose coverages under the group health maintenance contract terminate at the same time; or

(d)  To a child solely with respect to herself or himself upon termination of the child's coverage by reason of ceasing to be a qualified family member under the group health maintenance contract or under any converted contract, if a conversion privilege is not otherwise provided above with respect to such termination.

(13)  GROUP COVERAGE IN LIEU OF INDIVIDUAL COVERAGE.--The health maintenance organization may elect to provide group health maintenance organization coverage through a group converted contract in lieu of the issuance of an individual converted contract.

(14)  NOTIFICATION.--A notification of the conversion privilege shall be included in each health maintenance contract and in any certificate or member's handbook. The organization shall mail an election and premium notice form, including an outline of coverage, on a form approved by the department, within 14 days after any individual who is eligible for a converted health maintenance contract gives notice to the organization that the individual is considering applying for the converted contract or otherwise requests such information. The outline of coverage must contain a description of the principal benefits and coverage provided by the contract and its principal exclusions and limitations, including, but not limited to, deductibles and coinsurance.

History.--ss. 44, 47, ch. 85-177; ss. 130, 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 491, ch. 97-102; s. 30, ch. 97-179; s. 27, ch. 98-159; s. 15, ch. 99-204; s. 9, ch. 99-275; s. 14, ch. 99-393.

¹Note.--

A.  Section 10, ch. 99-275, provides that "[t]his act shall take effect July 1, 1999, and shall apply to all contracts renewed or entered into on or after that date."

B.  Section 16, ch. 99-204, provides that "[t]his act shall take effect October 1, 1999, and shall apply to policies and contracts issued or renewed on or after that date."

641.3923  Discrimination against providers prohibited.--A health maintenance organization shall not discriminate with respect to participation as to any advanced registered nurse practitioner licensed and certified pursuant to s. 464.012, who is acting within the scope of such license and certification, solely on the basis of such license or certification. This section shall not be construed to prohibit a plan from including providers only to the extent necessary to meet the needs of the plan's enrollees or from establishing any measure designed to maintain quality and control costs consistent with the responsibilities of the plan.

History.--s. 2, ch. 98-285.

641.40  Short title.

641.401  Declaration of legislative intent, findings, and purposes.

641.4015  Part exclusive; applicability of other laws.

641.402  Definitions.

641.403  Rulemaking authority.

641.405  Application for certificate of authority to operate prepaid health clinic.

641.406  Issuance of certificate of authority.

641.4065  Insurance business not authorized.

641.407  Minimum surplus.

641.408  Use of certain words prohibited in the name of a prepaid health clinic.

641.409  Insolvency protection.

641.4091  Levy upon deposit; limitation.

641.41  Annual report of prepaid health clinic; administrative penalty.

641.411  Other reporting requirements.

641.412  Fees.

641.414  Investment of funds of prepaid health clinic.

641.416  Acquisition.

641.418  Examination of prepaid health clinic by the department.

641.419  Rehabilitation, liquidation, conservation, or dissolution of prepaid health clinic.

641.42  Prepaid health clinic contracts.

641.421  Language used in contracts and advertisements; translations.

641.422  Contract provisions incorporating charter or bylaw provisions.

641.423  Execution of contracts.

641.424  Validity of noncomplying contracts.

641.425  Construction of contracts.

641.426  Delivery of contract to subscriber.

641.427  Notice of cancellation, termination, or nonrenewal of contract.

641.428  Nondiscrimination of coverage for certain surgical procedures involving bones or joints.

641.429  Acceptable payments to prepaid health clinic.

641.43  Provider contracts.

641.432  Providers of service; penalty for unauthorized use of providers; interference with judgment prohibited.

641.437  Investigatory power of department.

641.438  Genetic information restrictions.

641.44  Unfair methods of competition and unfair or deceptive acts or practices prohibited.

641.441  Unfair methods of competition and unfair or deceptive acts or practices defined.

641.442  Penalty for operation of prepaid health clinic, or issuance, delivery, or renewal of prepaid health clinic contract, without certificate of authority.

641.443  Temporary restraining orders.

641.444  Injunction.

641.445  Defined practices; hearings, witnesses, appearances, production of books, and service of process.

641.446  Cease and desist and penalty orders.

641.447  Appeal from departmental order.

641.448  Penalty for violation of cease and desist order.

641.45  Revocation or cancellation of certificate of authority; suspension of authority to enroll new subscribers; terms of suspension.

641.452  Administrative penalty in lieu of suspension or revocation of certificate of authority.

641.453  Civil liability.

641.454  Civil action to enforce prepaid health clinic contract; attorney's fees; court costs.

641.455  Disposition of moneys collected under this part.

641.457  Exemption for certain operational prepaid health clinics.

641.459  Construction and relationship to other laws.

641.40  Short title.--This part shall be known and may be cited as the "Prepaid Health Clinic Act."

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.401  Declaration of legislative intent, findings, and purposes.--

(1)  Faced with the continuation of mounting health care costs, coupled with the interest of the state in high-quality care, the Legislature has determined that there is a need to explore intermediate or limited levels of delivery of prepaid health care services, with a view toward achieving greater efficiency and economy in the provision of these services.

(2)  Prepaid health clinics, referred to in this part as "clinics," are developing rapidly in communities in the state. Through these organizations, structured in various forms, basic services are provided directly to groups of people who make regular premium payments as a condition upon their participation. These plans, when properly operated, emphasize effective cost and quality controls.

(3)  It is the purpose of this part to:

(a)  Minimize legal barriers to the organization, promotion, and expansion of prepaid health clinics.

(b)  Recognize an exemption for prepaid health clinics, when operating under a subsisting certificate of authority issued pursuant to this part, from the operation of the Florida Insurance Code, as defined in s. 624.01, except in the manner and to the extent set forth in this part.

(4)  Although it is the intent of this part to provide an opportunity for the development of prepaid health clinics, there is no intent to impair the present system for the delivery of health services.

(5)  The Legislature has determined that the operation of a prepaid health clinic, or the issuance, delivery, or renewal of a prepaid health clinic contract, without a subsisting certificate of authority constitutes a danger to the citizens of this state and exposes a subscriber to immediate and irreparable injury, loss, or damage.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.4015  Part exclusive; applicability of other laws.--Except as provided in this part, prepaid health clinics shall be covered by the provisions of this part and shall be exempt from all other provisions of the Florida Insurance Code.

History.--ss. 27, 50, ch. 85-321; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.402  Definitions.--As used in this part, the term:

(1)  "Basic services" includes any of the following: emergency care, physician care other than hospital inpatient physician services, ambulatory diagnostic treatment, and preventive health care services.

(2)  "Department" means the Department of Insurance.

(3)  "Guaranteeing organization" means an organization which is domiciled in the United States; which has authorized service of process against it; and which has appointed the Insurance Commissioner and Treasurer as its agent for service of process in connection with any cause of action arising in this state, based upon any guarantee entered into under this part.

(4)  "Insolvent" or "insolvency" means the inability of a prepaid health clinic to discharge its liabilities as they become due in the normal course of business.

(5)  "Prepaid health clinic" means any organization authorized under this part which provides, either directly or through arrangements with other persons, basic services to persons enrolled with such organization, on a prepaid per capita or prepaid aggregate fixed-sum basis, including those basic services which subscribers might reasonably require to maintain good health. However, no clinic which provides or contracts for, either directly or indirectly, inpatient hospital services, hospital inpatient physician services, or indemnity against the cost of such services shall be a prepaid health clinic.

(6)  "Prepaid health clinic contract" means any contract entered into by a prepaid health clinic with a subscriber or group of subscribers to provide any of the basic services in exchange for a prepaid per capita or prepaid aggregate fixed sum.

(7)  "Provider" means any physician or person other than a hospital that furnishes health care services and is licensed or authorized to practice in this state.

(8)  "Reporting period" means the particular span of time by or for which accounts are redeemed on an annualized basis.

(9)  "Subscriber" means an individual who has contracted, or on whose behalf a contract has been entered into, with a prepaid health clinic for health care services.

(10)  "Surplus" means total unencumbered assets in excess of total liabilities. Surplus includes capital stock, capital in excess of par, and retained earnings and may include surplus notes.

(11)  "Surplus notes" means debt which has been guaranteed by the United States Government or its agencies or debt which has been subordinated to all claims of subscribers and general creditors of the prepaid health clinic.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.403  Rulemaking authority.--The Department of Insurance has authority to adopt rules pursuant to ss. 120.536(1) and 120.54 to implement the provisions of this part.

History.--ss. 10, 11, ch. 84-313; s. 13, ch. 87-236; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 214, ch. 98-200.

641.405  Application for certificate of authority to operate prepaid health clinic.--

(1)  No person may operate a prepaid health clinic without first obtaining a certificate of authority from the department. The department shall not issue a certificate of authority to any applicant which does not possess a valid Health Care Provider Certificate issued by the Agency for Health Care Administration.

(2)  Each application for a certificate of authority shall be on such form as the department prescribes, and such application shall be accompanied by:

(a)  A copy of the basic organizational document of the applicant, if any, such as the articles of incorporation, articles of association, partnership agreement, trust agreement, or other applicable document, and all amendments to such document.

(b)  A copy of the constitution, bylaws, rules and regulations, or similar form of document, if any, regulating the conduct of the affairs of the applicant.

(c)  A list of the names, addresses, and official capacities with the applicant of the persons who are to be responsible for the conduct of the affairs of the clinic, including all members of the governing body, the officers and directors in the case of a corporation, and the partners or associates in the case of a partnership or association. Such persons shall fully disclose to the department and the governing body of the clinic the extent and nature of any contracts or arrangements between them and the clinic, including any possible conflicts of interest.

(d)  A statement generally describing the clinic and its operations.

(e)  Each form of prepaid health clinic contract that the applicant proposes to offer the subscribers, showing for each form of contract the benefits to which the subscribers are entitled, together with a table of the rates charged, or proposed to be charged.

(f)  A copy of the applicant's Health Care Provider Certificate from the Agency for Health Care Administration, issued pursuant to part III of this chapter.

(g)  A financial statement prepared on the basis of generally accepted accounting principles, except that surplus notes acceptable to the department may be included in the calculation of surplus.

History.--ss. 10, 11, ch. 84-313; s. 29, ch. 85-62; s. 14, ch. 87-236; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 46, ch. 95-211; s. 268, ch. 99-8.

641.406  Issuance of certificate of authority.--The department shall issue a certificate of authority for a prepaid health clinic to any applicant filing a properly completed application in conformity with s. 641.405, upon payment of the prescribed fees and upon the department's being satisfied that:

(1)  As a condition precedent to the issuance of any certificate, the applicant has obtained a Health Care Provider Certificate from the Agency for Health Care Administration pursuant to part III of this chapter.

(2)  The proposed rates are actuarially sound for the benefits provided, including administrative costs.

(3)  The applicant has met the minimum surplus requirements of s. 641.407.

(4)  The procedures for offering basic services and offering and terminating contracts to subscribers will not unfairly discriminate on the basis of age, health, or economic status. However, this subsection does not prohibit reasonable underwriting classifications for the purposes of establishing contract rates, nor does it prohibit experience rating.

(5)  The procedures for offering basic services and offering and terminating contracts to subscribers will not discriminate on the basis of sex, race, or national origin.

(6)  The applicant furnishes evidence of adequate insurance coverage or an adequate plan for self-insurance to respond to claims for injuries arising out of the furnishing of basic services.

(7)  The ownership, control, or management of the applicant is competent and trustworthy and possesses managerial experience that would make the proposed clinic operation beneficial to the subscribers. The department shall not grant or continue authority to transact the business of a prepaid health clinic in this state at any time during which the department has good reason to believe that the ownership, control, or management of the clinic is under the control of any person whose business operations are or have been marked by business practices or conduct that is to the detriment of the public, stockholders, investors, or creditors; by the improper manipulation of assets or of accounts; or by bad faith.

(8)  The application and the applicant are in conformity with all requirements of this part.

History.--ss. 10, 11, ch. 84-313; s. 15, ch. 87-236; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 47, ch. 95-211; s. 269, ch. 99-8.

641.4065  Insurance business not authorized.--Nothing in the Florida Insurance Code or this part shall be deemed to authorize any prepaid health clinic to transact any insurance business other than that issuing prepaid health clinic contracts or otherwise to engage in any other type of insurance unless it is authorized under a certificate of authority issued by the department under the provisions of the Florida Insurance Code.

History.--ss. 28, 50, ch. 85-321; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.407  Minimum surplus.--

(1)  Each prepaid health clinic shall have and maintain minimum surplus in accordance with the following schedule:

(a)  On January 1, 1994, $100,000 or 6 percent of total liabilities, whichever is greater.

(b)  On January 1, 1995, $125,000 or 8 percent of total liabilities, whichever is greater.

(c)  On January 1, 1996, $150,000 or 10 percent of total liabilities, whichever is greater.

(2)  In lieu of having any minimum surplus, the prepaid health clinic may provide a written guaranty to assure payment of covered subscriber claims if the guaranteeing organization has been in operation for at least 3 years and has a surplus, not including land, buildings, and equipment, equal to the product of 2 times the amount of the required statutory surplus. Such guaranteeing organization and such written guaranty must be acceptable to, and approved by, the department. The department shall consider the likelihood of the payment of subscriber claims in granting or withholding such approval.

History.--ss. 10, 11, ch. 84-313; s. 30, ch. 85-62; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 56, ch. 93-148.

641.408  Use of certain words prohibited in the name of a prepaid health clinic.--

(1)  No person issued a certificate of authority as a prepaid health clinic, other than a licensed insurer, insofar as its name is concerned, shall use in its name, contracts, or literature any of the words "health maintenance organization," "HMO," "insurance," "casualty," "surety," or "mutual"; any other word descriptive of the health maintenance organization, insurance, casualty, or surety business; or any other word deceptively similar to the name or description of a health maintenance organization, insurance corporation, or surety corporation doing business in this state.

(2)  A person that has not been issued a certificate of authority under the provisions of this part shall not use in its name, logo, contracts, or literature the phrase "prepaid health clinic" or the initials "PHC"; nor imply, directly or indirectly, that it is a prepaid health clinic; nor hold itself out to be a prepaid health clinic.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.409  Insolvency protection.--

(1)  Every prepaid health clinic shall comply with one of the following paragraphs:

(a)  The prepaid health clinic shall secure insurance to the satisfaction of the department to protect subscribers in the event the prepaid health clinic is unable to meet its obligations to subscribers under the terms of any prepaid health clinic contract issued to a subscriber.

(b)  The prepaid health clinic shall file with the department a surety bond issued by an authorized surety insurer. The bond shall be for the same purpose as the insurance in lieu of which the bond is filed. The department shall not approve any bond under the terms of which the protection afforded against insolvency is not equivalent to the protection afforded by such insurance. The bond shall guarantee that the prepaid health clinic will faithfully and truly perform all the conditions of any prepaid health clinic contract. No such bond shall be canceled or subject to cancellation unless at least 60 days' notice of the cancellation, in writing, is filed with the department. In the event that the notice of termination of the bond is filed with the department, the prepaid health clinic insured under the bond shall, within 30 days of the filing of the notice of termination, provide the department with a replacement bond meeting the requirements of this part or secure insurance as required by paragraph (a). The cancellation of a bond does not relieve the obligation of the issuer of the bond for claims arising out of contracts issued prior to the cancellation of the bond unless a replacement bond or insurance is secured. In no event shall the issuer's aggregate liability under the bond exceed the face amount of the bond. If, within 30 days of filing the notice of termination, a replacement bond or insurance has not been secured and filed with the department, the department shall suspend the certificate of the prepaid health clinic until the deposit requirements are satisfied. Whenever the prepaid health clinic ceases to do business in this state and furnishes to the department satisfactory proof that it has discharged or otherwise adequately provided for all of its obligations to its subscribers, the department shall release any bond filed by the prepaid health clinic.

(2)  In determining the sufficiency of the insurance required under paragraph (1)(a) or the surety bond required under paragraph (1)(b), the department may consider the number of subscribers, the basic services included in subscriber contracts, and the cost of providing such basic services to subscribers in the geographic area served.

(3)  Every prepaid health clinic shall deposit with the department a cash deposit in the amount of $30,000 to guarantee that the obligations to the subscribers will be performed.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.4091  Levy upon deposit; limitation.--No judgment creditor or other claimant of a prepaid health clinic shall have the right to levy upon any of the assets or securities held in this state as a deposit under s. 641.409.

History.--ss. 40, 50, ch. 85-321; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.41  Annual report of prepaid health clinic; administrative penalty.--

(1)  Each prepaid health clinic shall file a report with the department, annually on or before March 1, or within 3 months of the end of the reporting period of the clinic, or within such extension of time for the filing of the report as the department, for good cause, may grant. The report of the prepaid health clinic must be filed on forms prescribed by the department and must be verified under oath by two executive officers of the clinic or, if the clinic is not a corporation, verified under oath by two persons who are principal managing directors of the affairs of the clinic. The report of the clinic shall show the condition of the clinic on the last day of the immediately preceding reporting period. Such report shall include:

(a)  A financial statement of the clinic, including its balance sheet and a statement of operations for the preceding year;

(b)  A list of the name and residence address of every person responsible for the conduct of the affairs of the clinic, together with a disclosure of the extent and nature of any contract or arrangement between such person and the clinic, including any possible conflicts of interest;

(c)  The number of prepaid health clinic contracts issued and outstanding, and the number of prepaid health clinic contracts terminated and a compilation of the reasons for such terminations;

(d)  Such statistical information as is requested by the department, which information shows the rates of the clinic for all basic services provided under prepaid health clinic contracts;

(e)  The number and amount of damage claims for medical injury initiated against the clinic and any of the providers engaged by it during the reporting year, broken down into claims with and without formal legal process, and the disposition, if any, of each such claim; and

(f)  Such other information relating to the performance of the clinic as is required by the department.

(2)  Any clinic which neglects to file the annual report in the form and within the time required by this section is subject to an administrative penalty, not to exceed $100 for each day during which the neglect continues; and, upon notice by the department to that effect, the authority of the clinic to do business in this state shall cease while such default continues.

History.--ss. 10, 11, ch. 84-313; s. 31, ch. 85-62; s. 16, ch. 87-236; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.411  Other reporting requirements.--

(1)  Each prepaid health clinic shall provide records and information to the Agency for Health Care Administration pursuant to s. 409.910(20) and (21) for the sole purpose of identifying potential coverage for claims filed with the agency and its fiscal agents for payment of medical services under the Medicaid program.

(2)  Any information provided by a prepaid health clinic under this section to the agency shall not be considered a violation of any right of confidentiality or contract that the prepaid health clinic may have with covered persons. The prepaid health clinic is immune from any liability that it may otherwise incur through its release of information to the agency under this section.

History.--s. 7, ch. 87-377; s. 1, ch. 88-303; s. 10, ch. 90-232; s. 39, ch. 90-295; ss. 187, 188, ch. 91-108; s. 70, ch. 91-282; s. 4, ch. 91-429; s. 48, ch. 95-211; s. 270, ch. 99-8; s. 190, ch. 99-397.

641.412  Fees.--

(1)  Every prepaid health clinic shall pay to the department the following fees:

(a)  For filing a copy of its application for a certificate of authority or an amendment to such certificate, a nonrefundable fee in the amount of $150.

(b)  For filing each annual report, a fee in the amount of $150.

(2)  The fees charged under this section shall be distributed as follows:

(a)  One-third of the total amount of fees shall be distributed to the Agency for Health Care Administration; and

(b)  Two-thirds of the total amount of fees shall be distributed to the Department of Insurance.

History.--ss. 10, 11, ch. 84-313; s. 53, ch. 87-226; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 271, ch. 99-8.

641.414  Investment of funds of prepaid health clinic.--The funds of any prepaid health clinic shall be invested only in securities permitted by the laws of this state for the investment of assets of life insurance companies.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.416  Acquisition.--Every prepaid health clinic shall be subject to the provisions of s. 628.4615.

History.--ss. 10, 11, ch. 84-313; ss. 14, 17, ch. 86-250; s. 4, ch. 87-50; s. 10, ch. 90-248; ss. 184, 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.418  Examination of prepaid health clinic by the department.--The department shall examine the affairs, transactions, accounts, business records, and assets of any prepaid health clinic as often as the department deems it expedient for the protection of the people of this state. Every clinic shall submit its books and records and take other appropriate action as may be necessary to facilitate an examination. However, medical records of individuals and records of physicians providing services under contracts to the clinic are not subject to audit, although such records may be subject to subpoena by court order upon a showing of good cause. For the purpose of examinations, the department may administer oaths to and examine the officers and agents of a clinic concerning its business and affairs. The expenses for the examination of each clinic by the department are subject to the same terms and conditions that apply to insurers under part II of chapter 624. In no event shall the expenses of all examinations exceed the maximum amount of $15,000 per year.

History.--ss. 10, 11, ch. 84-313; s. 17, ch. 87-236; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.419  Rehabilitation, liquidation, conservation, or dissolution of prepaid health clinic.--Any rehabilitation, liquidation, conservation, or dissolution of a prepaid health clinic shall be conducted under the supervision of the department. The department shall have all the powers with respect to such rehabilitation, liquidation, conservation, or dissolution that are granted to the department under the laws governing the rehabilitation, liquidation, conservation, or dissolution of life insurance companies.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.42  Prepaid health clinic contracts.--

(1)  Any applicant that has been issued a certificate of authority for a prepaid health clinic, which certificate of authority is subsisting and otherwise in compliance with this part, may enter into prepaid health clinic contracts in this state.

(2)  The rates charged by any clinic to its subscribers shall not be excessive, inadequate, or unfairly discriminatory. The department, in accordance with generally accepted actuarial practice, may define by rule what constitutes excessive, inadequate, or unfairly discriminatory rates and may require whatever information the department deems necessary to determine that a rate or proposed rate meets the requirements of this subsection.

(3)  No clinic shall issue or agree to issue any prepaid health clinic contract to a subscriber unless the contract has first been filed with, and approved by, the department.

(4)  Every contract must clearly state all of the services, including basic services, to which a subscriber is entitled under the contract and must include a clear and understandable statement of any limitations on the services or kinds of services to be provided, including any exclusion of any copayment feature or any schedule of benefits required by the contract or by any insurer or entity which is underwriting any of the services offered by the clinic. The contract shall also state where and in what manner the basic services may be obtained.

(5)  Every subscriber shall receive a clear and understandable description of the method of the clinic for resolving subscriber grievances; such method shall be set forth in the contract and shall be approved by the department on the basis of its underlying fairness.

(6)  The consideration paid for a prepaid health clinic contract shall be a part of the contract and shall be stated in the individual contract issued to a subscriber. Regardless of the duration or term of the prepaid health clinic contract, the consideration shall be payable monthly, prorated based upon the contract duration or term.

(7)(a)  If a clinic desires to amend any contract with any of its subscribers or desires to change any rate charged for the contract, the clinic may do so, upon filing with the department the proposed amendment or change in rates.

(b)  No prepaid health clinic contract form or application form when written application is required and is to be made a part of the policy or contract, or no printed amendment, addendum, rider, or endorsement form or form of renewal certificate, shall be delivered or issued for delivery in this state, unless the form has been filed with the department at its offices in Tallahassee by or in behalf of the clinic which proposes to use such form and has been approved by the department. Every such filing shall be made not less than 30 days in advance of any such use or delivery. At the expiration of such 30 days, the form so filed shall be deemed approved unless prior to the end of the 30 days the form has been affirmatively approved or disapproved by the department. The approval of any such form by the department constitutes a waiver of any unexpired portion of such waiting period. The department may extend by not more than an additional 15 days the period within which the department may so affirmatively approve or disapprove any such form, by giving notice of such extension before the expiration of the initial 30-day period. At the expiration of any such period as so extended, and in the absence of such prior affirmative approval or disapproval, such form shall be deemed approved. The department may, for cause, withdraw a previous approval. No clinic shall issue or use any form which has been disapproved by the department or any form for which the department has withdrawn approval.

(c)  The department shall disapprove any form filed under this subsection, or withdraw any previous approval of the form, only if the form:

1.  Is in any respect in violation of, or does not comply with, any provision of this part or rule adopted under this part.

2.  Contains or incorporates by reference, where such incorporation is otherwise permissible, any inconsistent, ambiguous, or misleading clauses, or exceptions and conditions which deceptively affect the risk purported to be assumed in the general coverage of the contract.

3.  Has a misleading title, misleading heading, or other indication of the provisions of the form which is misleading.

4.  Is printed or otherwise reproduced in such manner as to render any material provision of the form substantially illegible.

5.  Provides benefits which are unreasonable in relation to the rate charged or contains provisions which are unfair, inequitable, or contrary to the public policy of this state or encourage misrepresentation.

(d)  In determining whether the benefits are reasonable in relation to the rate charged, the department, in accordance with reasonable actuarial techniques, shall consider:

1.  Past loss experience and prospective loss experience.

2.  Allocation of expenses.

3.  Risk and contingency margins, along with justification of such margins.

4.  Acquisition costs.

5.  Other factors deemed appropriate by the department, based on sound actuarial techniques.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.421  Language used in contracts and advertisements; translations.--

(1)(a)  All prepaid health clinic contracts or forms shall be printed in English.

(b)  If the negotiations by a prepaid health clinic with a subscriber leading up to the effectuation of a prepaid health clinic contract are conducted in a language other than English, the prepaid health clinic shall supply to the subscriber a written translation of the contract, which translation accurately reflects the substance of the contract and is in the language used to negotiate the contract. Any such translation shall be furnished to the department as part of the filing of the prepaid health clinic contract form and shall be approved by the department prior to use. No translation of a prepaid health clinic contract form shall be approved by the department unless the translation accurately reflects the substance of the prepaid health clinic contract form in translation. When a translation of a prepaid health clinic contract is used, the translation shall clearly and conspicuously state on its face and in the language of the translation:

This is a translation of the document that you are about to sign.

(2)  All advertisements by a prepaid health clinic, if printed or broadcast in a language other than English, also shall be available in English and shall be furnished to the department upon request. As used in this subsection, the term "advertisement" means any advertisement, circular, pamphlet, brochure, or other printed material disclosing or disseminating advertising material or information by a clinic to prospective or existing subscribers and includes any radio or television transmittal of an advertisement or information.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.422  Contract provisions incorporating charter or bylaw provisions.--No prepaid health clinic contract shall contain any provision purporting to make a portion of the charter, bylaws, or other constituent document of the clinic a part of the contract unless the provision is set forth in full in the contract. Any contract provision in violation of this section is invalid, unless the provision operates to the benefit of the subscriber.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.423  Execution of contracts.--

(1)  Every prepaid health clinic contract shall be executed in the name of, and on behalf of, the clinic by an officer or employee of the clinic, the attorney in fact of the clinic, or a representative of the clinic duly authorized by the clinic.

(2)  A facsimile signature of any such individual executing the contract on behalf of the clinic may be used in lieu of his or her original signature.

(3)  No contract which is otherwise valid shall be rendered invalid by reason of the apparent execution of the contract on behalf of the clinic by the imprinted facsimile signature of an individual who was not authorized, as of the date of the contract, to execute the contract on behalf of the clinic.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 492, ch. 97-102.

641.424  Validity of noncomplying contracts.--

(1)  Any prepaid health clinic contract, or contract rider, endorsement, attachment, or addendum, that contains any condition or provision not in compliance with the requirements of this part but is otherwise valid shall not be rendered invalid by such condition or provision, except as provided in s. 641.421, but shall be construed and applied in accordance with such conditions and provisions as would have applied had such contract, rider, endorsement, attachment, or addendum been in full compliance with this contract. In the event a clinic issues or delivers any contract for an amount which exceeds any limitation otherwise provided for in this part, such clinic is liable to the subscriber or his or her beneficiary for the full amount stated in the contract in addition to any other penalties that may be imposed under this part.

(2)  Any contract delivered or issued for delivery in this state covering a subscriber resident, located, or to be performed in this state, which subscriber, pursuant to the provisions of this part, the clinic may not lawfully provide under such a contract, is cancelable at any time by the clinic, any provision of the contract to the contrary notwithstanding; and the clinic shall promptly cancel the contract in accordance with the request of the department for such cancellation. No such illegality or cancellation shall be deemed to relieve the clinic of any liability incurred by the clinic under the contract while the contract was in force or to prohibit the clinic from retaining the pro rata earned premium on the contract. This provision does not relieve the clinic from any penalty otherwise incurred by the clinic under this part on account of any such violation.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 493, ch. 97-102.

641.425  Construction of contracts.--

(1)  Every prepaid health clinic contract shall be construed according to the entirety of its terms and conditions as set forth in the contract and as amplified, extended, or modified by any application therefor or any rider, endorsement, attachment, or addendum to the contract.

(2)  The term "physician" or "medical doctor," when used in any contract providing for the payment of surgical procedures which are specified in the contract or performed in an accredited hospital in consultation with a licensed physician and are within the scope of a dentist's professional license, shall be construed to include a dentist who performs such specified procedures.

(3)  Notwithstanding any other provision of law, when any contract provides for the payment for procedures which are specified in the contract and are within the scope of an optometrist's or podiatric physician's professional license, such contract shall be construed to include payment to an optometrist or podiatric physician who performs such procedures. In the case of podiatric medicine services, payments shall be made in accordance with the coverage now provided for medical and surgical benefits.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 226, ch. 98-166.

641.426  Delivery of contract to subscriber.--Unless delivered upon execution or issuance, every prepaid health clinic contract shall be mailed or delivered to the subscriber within 10 days of its execution or issuance, except when a condition required by the clinic has not been met by the applicant or subscriber.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.427  Notice of cancellation, termination, or nonrenewal of contract.--A prepaid health clinic may not cancel or otherwise terminate or fail to renew a prepaid health clinic contract without giving the subscriber at least 30 days' notice in writing of the cancellation, termination, or nonrenewal of the contract. The written notice shall state the reason or reasons for the cancellation, termination, or nonrenewal. Every prepaid health clinic contract shall contain a clause which requires that this notice be given.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.428  Nondiscrimination of coverage for certain surgical procedures involving bones or joints.--No prepaid health clinic contract or policy which provides coverage on a group or individual basis for any diagnostic or surgical procedure involving bones or joints of the skeleton shall discriminate against coverage for any similar diagnostic or surgical procedure involving bones or joints of the jaw and facial region, if, under accepted medical standards, such procedure or surgery is medically necessary to treat conditions caused by congenital or developmental deformity, disease, or injury. This section shall not be construed to affect any other coverage under this part or to restrict the scope of coverage under any policy, plan, or contract. Nothing in this section shall be construed to discourage appropriate nonsurgical procedures or to prohibit the continued coverage of nonsurgical procedures in the treatment of a bone or joint of the jaw and facial region. Furthermore, nothing in this subsection requires coverage for care or treatment of the teeth or gums, for intraoral prosthetic devices, or for surgical procedures for cosmetic purposes.

History.--s. 6, ch. 96-361.

641.429  Acceptable payments to prepaid health clinic.--Each prepaid health clinic may accept payments from governmental agencies, corporations, associations, groups, or individuals, which payments cover all or part of the cost of contracts entered into between the prepaid health clinic and its subscribers.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.43  Provider contracts.--Whenever a prepaid health clinic provides services to subscribers through an arrangement with a provider, there shall be a written contract with the provider. The contract shall include a provision that, if the prepaid health clinic fails to meet its obligation to pay fees for services already rendered by the provider to a subscriber, the prepaid health clinic and not the subscriber is liable for the payment of such fees.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.432  Providers of service; penalty for unauthorized use of providers; interference with judgment prohibited.--

(1)  Any prepaid health clinic which utilizes the services of a provider who is not licensed or otherwise authorized by law to provide such services is guilty of a felony of the third degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.

(2)  Every prepaid health clinic or provider shall display, in a prominent place in the clinic's or provider's waiting area at which the provider treats subscribers, a true and correct copy of the current and valid license or legal authorization of each provider.

(3)  The professional judgment of a physician licensed under chapter 458 or chapter 459 concerning the proper course of treatment of a subscriber shall not be subject to modification by the prepaid health clinic or its board of directors, officers, or administrators. However, this subsection does not prohibit a utilization management program established by a prepaid health clinic.

History.--ss. 10, 11, ch. 84-313; s. 32, ch. 85-62; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.437  Investigatory power of department.--The department has the power to examine and investigate the affairs of every person, entity, or prepaid health clinic in order to determine whether the person, entity, or prepaid health clinic is operating in accordance with the provisions of this part or has been or is engaged in any unfair method of competition or any unfair or deceptive act or practice prohibited by s. 641.44.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.438  Genetic information restrictions.--A prepaid health clinic must comply with the provisions of s. 627.4301.

History.--s. 6, ch. 97-182.

641.44  Unfair methods of competition and unfair or deceptive acts or practices prohibited.--No person, entity, or prepaid health clinic shall engage in this state in any trade practice which is defined in this part as, or determined pursuant to s. 641.437 to be, an unfair method of competition or an unfair or deceptive act or practice involving the business of prepaid health clinics.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.441  Unfair methods of competition and unfair or deceptive acts or practices defined.--The following are defined as unfair methods of competition and unfair or deceptive acts or practices:

(1)  MISREPRESENTATION AND FALSE ADVERTISING OF PREPAID HEALTH CLINIC CONTRACTS.--Knowingly making, issuing, circulating, or causing to be made, issued, or circulated, any estimate, illustration, circular, statement, sales presentation, omission, or comparison which:

(a)  Misrepresents the benefits, advantages, conditions, or terms of any prepaid health clinic contract.

(b)  Is misleading, or is a misrepresentation as to the financial condition of any person.

(c)  Uses any name or title of a contract, which name or title misrepresents the true nature of the contract.

(d)  Is a misrepresentation for the purpose of inducing, or tending to induce, the lapse, forfeiture, exchange, conversion, or surrender of any prepaid health clinic contract, health maintenance contract as defined in s. 641.19, or health insurance policy or contract providing health insurance as defined in s. 624.603.

(e)  Misrepresents the benefits, nature, characteristics, uses, standard, quantity, quality, cost, rate, scope, source, or geographic origin or location of any goods or services available from or provided by, directly or indirectly, a prepaid health clinic.

(f)  Misrepresents the affiliation, connection, or association of any goods, services, or business establishment.

(g)  Advertises goods or services with intent not to sell them as advertised.

(h)  Disparages the goods, services, or business of another person by any false or misleading representation.

(i)  Misrepresents the sponsorship, endorsement, approval, or certification of goods or services.

(j)  Uses an advertising format which, by virtue of the design, location, or size of printed matter, is deceptive or misleading, or which may tend to be deceptive or misleading, or which would be deceptive or misleading to any reasonable person.

(k)  Offers to provide a service which the prepaid health clinic is unable to provide.

(l)  Misrepresents the availability of a service provided by the prepaid health clinic, either directly or indirectly, including the availability of the service as to location.

(m)  Disseminates any advertisement, information, or other material pertaining to the prepaid health clinic, including any radio or television transmittal of an advertisement or of information, without disclosing as a part of such dissemination adequate reference to the existence of any limitations or exclusions contained in the contract.

(n)  Disseminates any advertisement, information, or other material, including any radio or television transmittal of an advertisement or of information, which contains any limitation or exclusion in a language that is not the language principally used in such dissemination or in such advertisement.

(o)  Makes an offer in which there is a material contingency, condition, exclusion, or limitation without conspicuously stating the contingency, condition, exclusion, or limitation in the offer and in the language in which the offer was made.

(2)  FALSE INFORMATION AND ADVERTISING, GENERALLY.--Knowingly making, publishing, disseminating, circulating, or placing before the public, or causing, directly or indirectly, there to be made, published, disseminated, circulated, or placed before the public:

(a)  In a newspaper, magazine, or other publication;

(b)  In the form of a notice, circular, pamphlet, letter, or poster;

(c)  Over any radio or television station; or

(d)  In any other way

an advertisement, announcement, or statement containing any assertion, representation, or statement with respect to the business of the prepaid health clinic which is untrue, deceptive, or misleading.

(3)  DEFAMATION.--Knowingly making, publishing, disseminating, or circulating, directly or indirectly, or aiding, abetting, or encouraging the making, publishing, disseminating, or circulating of, any oral or written statement, or any pamphlet, circular, article, or literature, which is false or maliciously critical of, or derogatory to, any person and which is calculated to injure such person.

(4)  FALSE STATEMENTS AND ENTRIES.--

(a)  Knowingly:

1.  Filing a false statement with any supervisory or other public official;

2.  Making, publishing, disseminating, or circulating a false statement;

3.  Delivering a false statement to any person;

4.  Placing a false statement before the public; or

5.  Causing, directly or indirectly, a false statement to be made, published, disseminated, circulated, or delivered to a person or placed before the public; or

(b)  Knowingly making a false entry of a material fact in any book, report, or statement of a person.

(5)  UNFAIR CLAIM SETTLEMENT PRACTICES.--

(a)  Attempting to settle claims on the basis of an application or any other material document which was altered without notice to, or the knowledge or consent of, the subscriber or group of subscribers to a prepaid health clinic;

(b)  A material misrepresentation made to the subscriber for the purpose and with the intent of effecting settlement of claims, loss, or damage under a prepaid health clinic contract on less favorable terms than those terms provided in, and contemplated by, the contract; or

(c)  Committing or performing any of the following:

1.  Failure to properly investigate claims;

2.  Misrepresentation of pertinent facts or contract provisions relating to the coverage at issue;

3.  Failure to acknowledge and act promptly upon communications with respect to claims;

4.  Denial of claims without conducting reasonable investigations based upon available information;

5.  Failure to affirm or deny coverage of claims upon the written request of the subscriber within a reasonable time, not to exceed 30 days, after a claim or proof-of-loss statement has been completed;

6.  Failure to provide promptly a reasonable explanation to the subscriber of the basis in the contract, in relation to the facts or applicable law, for a denial of a claim or for the offer of a compromise settlement; or

7.  Unless a legitimate coverage defense exists, failure to provide any subscriber with services, care, or treatment contracted for pursuant to any prepaid health clinic contract.

(6)  FAILURE TO MAINTAIN COMPLAINT-HANDLING PROCEDURES.--Failure of a person to maintain a record of each complaint received for a 3-year period after the date of the receipt of the written complaint.

(7)  REFUSAL TO ISSUE A CONTRACT.--The refusal to issue a prepaid health clinic contract solely because of an individual's race, color, national origin, sex, marital status, or creed.

(8)  OPERATION WITHOUT A SUBSISTING CERTIFICATE OF AUTHORITY.--Operation of a prepaid health clinic by any person or entity without a subsisting certificate of authority, or the issuance, delivery, or renewal of any prepaid health clinic contract by a prepaid health clinic, person, or entity without a subsisting certificate of authority.

History.--ss. 10, 11, ch. 84-313; s. 33, ch. 85-62; s. 78, ch. 89-360; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.442  Penalty for operation of prepaid health clinic, or issuance, delivery, or renewal of prepaid health clinic contract, without certificate of authority.--Any person or entity that operates a prepaid health clinic, or issues, delivers, or renews any prepaid health clinic contract, without first obtaining and then maintaining thereafter a certificate of authority is guilty of a felony of the third degree and is, in addition to any prescribed applicable denial, suspension, or revocation of a certificate of authority, punishable as provided in s. 775.082 or s. 775.083. Each instance of such violation shall be considered a separate offense.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.443  Temporary restraining orders.--

(1)  The department is vested with the power to seek a temporary restraining order:

(a)  On behalf of the department or on behalf of a subscriber or subscribers of a prepaid health clinic that is being operated by a person or entity without a subsisting certificate of authority; or

(b)  On behalf of the department or on behalf of a subscriber or subscribers to whom a prepaid health clinic, person, or entity is issuing, delivering, or renewing prepaid health clinic contracts without an existing certificate of authority.

(2)  The department and the Agency for Health Care Administration are each vested with the power to seek a temporary restraining order on their behalf or on behalf of a subscriber or subscribers of a prepaid health clinic that is being operated in violation of any provision of this part or any rule promulgated under this part, or any other applicable law or rule.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 272, ch. 99-8.

641.444  Injunction.--In addition to the penalties and other enforcement provisions of this part, if a person, entity, or prepaid health clinic has engaged in any activity prohibited by this part or any rule adopted pursuant to this part, the department may resort to a proceeding for injunction in the circuit court of the county where such person, entity, or prepaid health clinic is located or has her or his or its principal place of business; and the department may apply in such court for such temporary and permanent orders as the department may deem necessary to restrain the person, entity, or prepaid health clinic from engaging in any such activity, until the person, entity, or prepaid health clinic complies with the provisions and rules.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 494, ch. 97-102.

641.445  Defined practices; hearings, witnesses, appearances, production of books, and service of process.--

(1)  Whenever the department has reason to believe that a person, entity, or prepaid health clinic has engaged, or is engaging, in this state in any unfair method of competition or any unfair or deceptive act or practice as defined in s. 641.441, or is operating a prepaid health clinic without a certificate of authority as required by this part or otherwise operating in violation of any provision of this part or rule adopted pursuant to this part, and that a proceeding by the department in respect thereto would be in the interest of the public, the department shall conduct, or cause to have conducted, a hearing in accordance with chapter 120.

(2)  The department, a duly empowered hearing officer, or an administrative law judge shall, during the conduct of such hearing, have those powers enumerated in s. 120.569; however, the penalty for the failure to comply with a subpoena or with an order directing discovery is limited to a fine not to exceed $1,000 per violation.

(3)  A statement of charges, notice, or order under this part may be served by anyone duly authorized by the department, either in the manner provided by law for service of process in civil actions or by certifying and mailing a copy of the statement of charges, notice, or order to the person, entity, or prepaid health clinic affected by the statement, notice, or order or other process at his or her or its residence or principal office or place of business. The verified return by the person so serving such statement, notice, or order or other process, setting forth the manner of the service, is proof of such service; and the return postcard receipt for such statement, notice, or order or other process, certified and mailed as provided in this subsection, is proof of the service of the statement, notice, or order or other process.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 287, ch. 96-410; s. 1755, ch. 97-102.

641.446  Cease and desist and penalty orders.--After the hearing provided in s. 641.445, the department shall enter a final order in accordance with s. 120.569. If it is determined that the person, entity, or prepaid health clinic charged has engaged in an unfair or deceptive act or practice or the unlawful operation of a prepaid health clinic, the department also shall issue an order requiring the violator to cease and desist from engaging in such method of competition, act, or practice or unlawful operation of a prepaid health clinic. Furthermore, the department may, at its discretion, order any one or more of the following:

(1)  The suspension or revocation of the certificate of authority of the prepaid health clinic if it knew, or reasonably should have known, that it was in violation of this part.

(2)  If it is determined that the person or entity charged has engaged in the business of operating a prepaid health clinic without a certificate of authority, an administrative penalty not to exceed $1,000 for each prepaid health clinic contract offered or effectuated.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 288, ch. 96-410.

641.447  Appeal from departmental order.--Any person, entity, or prepaid health clinic that is subject to an order of the department under s. 641.446 may obtain a review of the order by filing an appeal from the order in accordance with the provisions and procedures for appeal under s. 120.68.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.448  Penalty for violation of cease and desist order.--Any person, entity, or prepaid health clinic that violates a cease and desist order of the department under s. 641.446 while such order is in effect, after notice and hearing as provided in s. 641.445, is subject, at the discretion of the department, to any one or more of the following:

(1)  A monetary penalty of not more than $50,000 as to all matters determined in such hearing.

(2)  The suspension or revocation of the certificate of authority of the prepaid health clinic.

History.--ss. 10, 11, ch. 84-313; s. 54, ch. 87-226; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.45  Revocation or cancellation of certificate of authority; suspension of authority to enroll new subscribers; terms of suspension.--

(1)  The maintenance of a valid and current Health Care Provider Certificate issued pursuant to part III of this chapter is a condition of the maintenance of a valid and current certificate of authority issued by the department to operate a prepaid health clinic. Revocation or nonrenewal of a Health Care Provider Certificate shall be deemed to be an automatic and immediate cancellation of a prepaid health clinic's certificate of authority.

(2)  The department may suspend the authority of a clinic to enroll new subscribers or revoke any certificate of authority issued to a prepaid health clinic, or order compliance within 60 days, if the department finds that any of the following conditions exist:

(a)  The clinic is not operating in compliance with this part or any rule promulgated under this part.

(b)  The plan is no longer actuarially sound or the clinic does not have the minimum surplus as required by this part.

(c)  The existing contract rates are excessive, inadequate, or unfairly discriminatory.

(d)  The clinic has advertised, merchandised, or attempted to merchandise its services in such a manner as to misrepresent its services or capacity for services or has engaged in deceptive, misleading, or unfair practices with respect to advertising or merchandising.

(e)  The organization is insolvent.

(f)  The clinic has not complied with the grievance procedures for subscribers that are set forth in any prepaid health clinic contract.

(g)  The clinic has not fully satisfied a judgment against the clinic within 10 days of the entry of the judgment by any court in the state or, in the case of an appeal from such judgment, has not fully satisfied the judgment within 60 days after affirmance of the judgment by the appellate court.

(3)  The department shall, in its order suspending the authority of a clinic to enroll new subscribers, specify the period during which the suspension is to be in effect and the conditions, if any, which must be met by the clinic prior to reinstatement of its authority to enroll new subscribers. The order of suspension is subject to rescission or modification by further order of the department prior to the expiration of the suspension period. Reinstatement shall not be made unless requested by the clinic; however, the department shall not grant reinstatement if it finds that the circumstances for which the suspension occurred still exist or are likely to recur.

History.--ss. 10, 11, ch. 84-313; s. 18, ch. 87-236; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 49, ch. 95-211.

641.452  Administrative penalty in lieu of suspension or revocation of certificate of authority.--The department may, in lieu of suspension or revocation of a certificate of authority, levy an administrative penalty in an amount not more than $10,000 for each violation by a prepaid health clinic. In levying such fine, the department shall consider the number of members and total revenues of the clinic and whether the violation was committed knowingly and willfully.

History.--ss. 10, 11, ch. 84-313; s. 20, ch. 87-236; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.453  Civil liability.--The provisions of this part are cumulative to the rights under the general civil law and common law, and no action of the department shall abrogate such rights to damages or other relief in any court.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.454  Civil action to enforce prepaid health clinic contract; attorney's fees; court costs.--In any civil action brought to enforce the terms and conditions of a prepaid health clinic contract, the prevailing party is entitled to recover reasonable attorney's fees and court costs. This section shall not be construed to authorize a civil action against the department, its employees, or the Insurance Commissioner and Treasurer or against the Agency for Health Care Administration, the employees of the Agency for Health Care Administration, or the Director of Health Care Administration.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 273, ch. 99-8.

641.455  Disposition of moneys collected under this part.--Fees, administrative penalties, examination expenses, and other sums collected by the department under this part shall be deposited to the credit of the Insurance Commissioner's Regulatory Trust Fund; however, fees, examination expenses, and other sums collected by, or allocated to, the Agency for Health Care Administration under this part shall be deposited to the credit of the General Revenue Fund.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 274, ch. 99-8.

641.457  Exemption for certain operational prepaid health clinics.--The provisions of this part do not apply to those prepaid health clinics providing the services defined in ss. 641.40 through 641.459, which clinics have been continuously engaged in providing such services since January 1, 1947, provided that any prepaid health clinic claiming an exemption under this section notifies the department of its claim on or before January 1, 1985. This exemption will terminate upon a change in controlling ownership of the organization.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429.

641.459  Construction and relationship to other laws.--

(1)  Except as provided in this part, the Florida Insurance Code, as defined in s. 624.01, does not apply to prepaid health clinics certificated under this part; and prepaid health clinics certificated under this part are not subject to part I of this chapter.

(2)  The solicitation of subscribers by a prepaid health clinic or its representative shall not be construed to be violative of any provision of law relating to solicitation or advertising by health professionals if the prepaid health clinic is operating pursuant to a subsisting certificate of authority.

History.--ss. 10, 11, ch. 84-313; ss. 187, 188, ch. 91-108; s. 4, ch. 91-429; s. 56, ch. 99-3.

641.47  Definitions.

641.48  Purpose and application of part.

641.49  Certification of health maintenance organization and prepaid health clinic as health care providers; application procedure.

641.495  Requirements for issuance and maintenance of certificate.

641.51  Quality assurance program; second medical opinion requirement.

641.511  Subscriber grievance reporting and resolution requirements.

641.512  Accreditation and external quality assurance assessment.

641.513  Requirements for providing emergency services and care.

641.515  Investigation by the agency.

641.52  Revocation of certificate; suspension of new enrollment; suspension of the health care provider certificate; administrative fine; notice of action to the Department of Insurance; penalty for use of unlicensed providers.

641.54  Information disclosure.

641.545  Subscriber risk assessments; requirements.

641.55  Internal risk management program.

641.56  Rulemaking authority.

641.57  Disposition of moneys collected under this part.

641.58  Regulatory assessment; levy and amount; use of funds; tax returns; penalty for failure to pay.

641.59  Psychotherapeutic services; records and reports.

641.60  Statewide Managed Care Ombudsman Committee.

641.61  Subscriber satisfaction assessment.

641.62  Chronic diseases among subscriber populations.

641.65  District managed care ombudsman committees.

641.67  Statewide or district managed care ombudsman committee; exemption from public records requirements; exceptions.

641.68  Statewide or district managed care ombudsman committee; exemption from public meeting requirements.

641.70  Agency duties relating to the Statewide Managed Care Ombudsman Committee and the district managed care ombudsman committees.

641.75  Immunity from liability; limitation on testimony.

641.47  Definitions.--As used in this part, the term:

(1)  "Adverse determination" means a coverage determination by an organization that an admission, availability of care, continued stay, or other health care service has been reviewed and, based upon the information provided, does not meet the organization's requirements for medical necessity, appropriateness, health care setting, level of care or effectiveness, and coverage for the requested service is therefore denied, reduced, or terminated.

(2)  "Agency" means the Agency for Health Care Administration.

(3)  "Clinical peer" means a health care professional in the same or similar specialty as typically manages the medical condition, procedure, or treatment under review.

(4)  "Clinical review criteria" means the written screening procedures, decision abstracts, clinical protocols, and practice guidelines used by the organization to determine, for coverage purposes, the necessity and appropriateness of health care services.

(5)  "Complaint" means any expression of dissatisfaction by a subscriber, including dissatisfaction with the administration, claims practices, or provision of services, which relates to the quality of care provided by a provider pursuant to the organization's contract and which is submitted to the organization or to a state agency. A complaint is part of the informal steps of a grievance procedure and is not part of the formal steps of a grievance procedure unless it is a grievance as defined in subsection (10).

(6)  "Concurrent review" means utilization review conducted during a patient's hospital stay or course of treatment.

(7)  "Emergency medical condition" means:

(a)  A medical condition manifesting itself by acute symptoms of sufficient severity, which may include severe pain or other acute symptoms, such that the absence of immediate medical attention could reasonably be expected to result in any of the following:

1.  Serious jeopardy to the health of a patient, including a pregnant woman or a fetus.

2.  Serious impairment to bodily functions.

3.  Serious dysfunction of any bodily organ or part.

(b)  With respect to a pregnant woman:

1.  That there is inadequate time to effect safe transfer to another hospital prior to delivery;

2.  That a transfer may pose a threat to the health and safety of the patient or fetus; or

3.  That there is evidence of the onset and persistence of uterine contractions or rupture of the membranes.

(8)  "Emergency services and care" means medical screening, examination, and evaluation by a physician or, to the extent permitted by applicable law, by other appropriate personnel under the supervision of a physician, to determine if an emergency medical condition exists, and if it does, the care, treatment, or surgery for a covered service by a physician necessary to relieve or eliminate the emergency medical condition within the service capability of a hospital.

(9)  "Geographic area" means the county or counties, or any portion of a county or counties, within which the health maintenance organization provides or arranges for comprehensive health care services to be available to its subscribers.

(10)  "Grievance" means a written complaint submitted by or on behalf of a subscriber to an organization or a state agency regarding the:

(a)  Availability, coverage for the delivery, or quality of health care services, including a complaint regarding an adverse determination made pursuant to utilization review;

(b)  Claims payment, handling, or reimbursement for health care services; or

(c)  Matters pertaining to the contractual relationship between a subscriber and an organization.

A grievance does not include a written complaint submitted by or on behalf of a subscriber eligible for a grievance and appeals procedure provided by an organization pursuant to contract with the Federal Government under Title XVIII of the Social Security Act.

(11)  "Health care services" means comprehensive health care services, as defined in s. 641.19, when applicable to a health maintenance organization, and means basic services, as defined in s. 641.402, when applicable to a prepaid health clinic.

(12)  "Minimum services" includes any of the following: emergency care, inpatient hospital services, physician care, ambulatory diagnostic treatment, and preventive health care services.

(13)  "Organization" means any health maintenance organization as defined in s. 641.19 and any prepaid health clinic as defined in s. 641.402.

(14)  "Provider" means any physician, hospital, or other institution, organization, or person that furnishes health care services and is licensed or otherwise authorized to practice in the state. To submit or pursue a grievance on behalf of a subscriber, a provider must previously have been directly involved in the treatment or diagnosis of the subscriber.

(15)  "Retrospective review" means a review, for coverage purposes, of medical necessity conducted after services have been provided to a patient.

(16)  "Subscriber" means an individual who has contracted, or on whose behalf a contract has been entered into, with a health maintenance organization for health care services.

(17)  "Urgent grievance" means an adverse determination when the standard timeframe of the grievance procedure would seriously jeopardize the life or health of a subscriber or would jeopardize the subscriber's ability to regain maximum function.

History.--ss. 21, 27, ch. 87-236; s. 79, ch. 89-360; ss. 184, 187, 188, ch. 91-108; s. 91, ch. 91-282; s. 4, ch. 91-429; s. 29, ch. 96-199; s. 4, ch. 96-223; s. 5, ch. 97-159.

641.48  Purpose and application of part.--The purpose of this part is to ensure that health maintenance organizations and prepaid health clinics deliver high-quality health care to their subscribers. To achieve this purpose, this part requires all such organizations to obtain a health care provider certificate from the agency as a condition precedent to obtaining a certificate of authority to do business in Florida from the Department of Insurance, under part I or part II of this chapter.

History.--ss. 21, 27, ch. 87-236; ss. 187, 188, ch. 91-108; ss. 83, 91, ch. 91-282; s. 4, ch. 91-429; s. 12, ch. 93-260; s. 30, ch. 96-199.

641.49  Certification of health maintenance organization and prepaid health clinic as health care providers; application procedure.--

(1)  No person or governmental unit shall establish, conduct, or maintain a health maintenance organization or a prepaid health clinic in this state without first obtaining a health care provider certificate under this part.

(2)  The Department of Insurance shall not issue a certificate of authority under part I or part II of this chapter to any applicant which does not possess a valid health care provider certificate issued by the agency under this part.

(3)  Each application for a health care provider certificate shall be on a form prescribed by the agency. The following information and documents shall be submitted by an applicant and maintained, after certification under this part, by each organization and shall be available for inspection or examination by the agency at the offices of an organization at any time during regular business hours. The agency shall give reasonable notice to an organization prior to any onsite inspection or examination of its records or premises conducted under this section. The agency may require that the following information or documents be submitted with the application:

(a)  A copy of the articles of incorporation and all amendments to the articles.

(b)  A copy of the bylaws, rules and regulations, or similar form of document, if any, regulating the conduct of the affairs of the applicant or organization.

(c)  A list of the names, addresses, and official capacities with the applicant or organization of the persons who are to be responsible for the conduct of the affairs of the applicant or organization, including all officers and directors of the corporation. Such persons shall fully disclose to the agency and the directors of the applicant or organization the extent and nature of any contracts or arrangements between them and the applicant or organization, including any possible conflicts of interest.

(d)  The name and address of the applicant and the name by which the applicant or organization is to be known.

(e)  A statement generally describing the applicant or organization and its operations.

(f)  A copy of the form for each group and individual contract, certificate, subscriber handbook, and any other similar documents issued to subscribers.

(g)  A statement describing the manner in which health care services shall be regularly available.

(h)  A statement that the applicant has an established network of health care providers which is capable of providing the health care services that are to be offered by the organization.

(i)  The locations at which health care services shall be regularly available to subscribers.

(j)  The type of health care personnel engaged to provide the health care services and the quantity of the personnel of each type.

(k)  A statement giving the present and projected number of subscribers to be enrolled yearly for the next 3 years.

(l)  A statement indicating the source of emergency services and care on a 24-hour basis.

(m)  A statement that the physicians employed by the applicant have been formally organized as a medical staff and that the applicant's governing body has designated a chief of medical staff.

(n)  A statement describing the manner in which the applicant or organization assures the maintenance of a medical records system in accordance with accepted medical records' standards and practices.

(o)  If general anesthesia is to be administered in a facility not licensed by the agency, a copy of architectural plans that meet the requirements for institutional occupancy (NFPA 101 Life Safety Code, current edition as adopted by the State Fire Marshal).

(p)  A description of the applicant's or organization's internal quality assurance program, including committee structure, as required under s. 641.51.

(q)  A description and supporting documentation concerning how the applicant or health maintenance organization will comply with internal risk management program requirements under s. 641.55.

(r)  An explanation of how coverage for emergency services and care is to be effected outside the applicant's or health maintenance organization's stated geographic area.

(s)  A statement and map describing with reasonable accuracy the specific geographic area to be served.

(t)  A nonrefundable application fee of $1,000.

(u)  Such additional information as the agency may reasonably require.

History.--ss. 21, 27, ch. 87-236; ss. 187, 188, ch. 91-108; s. 91, ch. 91-282; s. 4, ch. 91-429; s. 50, ch. 95-211; s. 31, ch. 96-199.

641.495  Requirements for issuance and maintenance of certificate.--

(1)  The agency shall issue a health care provider certificate to an applicant filing a completed application in conformity with ss. 641.48 and 641.49, upon payment of the prescribed fee, and upon the agency's being satisfied that the applicant has the ability to provide quality of care consistent with the prevailing professional standards of care and which applicant otherwise meets the requirements of this part.

(2)  A certificate, unless sooner suspended or revoked, shall automatically expire 2 years from the date of issuance, or at any time accreditation is withdrawn, unless renewed by the organization. The certificate shall be renewed upon application for renewal and payment of a renewal fee of $1,000, provided that the organization is in compliance with the requirements of this part and all rules adopted under this part. An application for renewal of a certificate shall be made 90 days prior to expiration of the certificate, on forms provided by the agency. The renewal application shall not require the resubmission of any documents previously filed with the agency if such documents have remained valid and unchanged since their original filing.

(3)  The organization shall demonstrate its capability to provide health care services in the geographic area that it proposes to service. In addition, each health maintenance organization shall notify the agency of its intent to expand its geographic area at least 60 days prior to the date it plans to begin providing health care services in the new area. Prior to the date the health maintenance organization begins enrolling members in the new area, it must submit a notarized affidavit, signed by two officers of the organization who have the authority to legally bind the organization, to the agency describing and affirming its existing and projected capability to provide health care services to its projected number of subscribers in the new area. The notarized affidavit shall further assure that, 15 days prior to providing health care services in the new area, the health maintenance organization shall be able, through documentation or otherwise, to demonstrate that it shall be capable of providing services to its projected subscribers for at least the first 60 days of operation. If the agency determines that the organization is not capable of providing health care services to its projected number of subscribers in the new area, the agency may issue an order as required under chapter 120 prohibiting the organization from expanding into the new area. In any proceeding under chapter 120, the agency shall have the burden of establishing that the organization is not capable of providing health care services to its projected number of subscribers in the new area.

(4)  The organization shall ensure that the health care services it provides to subscribers, including physician services as required by s. 641.19(13)(d) and (e), are accessible to the subscribers, with reasonable promptness, with respect to geographic location, hours of operation, provision of after-hours service, and staffing patterns within generally accepted industry norms for meeting the projected subscriber needs.

(5)  The organization shall exercise reasonable care in assuring that delivered health care services are performed by appropriately licensed providers.

(6)  The organization shall have a system for verification and examination of the credentials of each of its providers. The organization shall maintain in a central file the credentials, including a copy of the current Florida license, of each of its physicians.

(7)  Every organization shall establish standards and procedures reasonably necessary to provide for the maintenance of a readily accessible medical records system which is adequate to accommodate necessary information including an accurate documentation of all services provided for every enrolled subscriber.

(8)  Each organization's contracts, certificates, and subscriber handbooks shall contain a provision, if applicable, disclosing that, for certain types of described medical procedures, services may be provided by physician assistants, nurse practitioners, or other individuals who are not licensed physicians.

(9)  Every organization shall have a subscriber grievance procedure, including, as appropriate, a procedure for disenrolling for cause, which is outlined in all master group and individual contracts as well as in any certificate or handbook provided to subscribers.

(10)  The organization shall provide, through contract or otherwise, for periodic review of its medical facilities and services, as required under s. 641.512.

(11)  The organization shall designate a medical director who is a physician licensed under chapter 458 or chapter 459.

(12)  The provisions of part I of chapter 395 do not apply to a health maintenance organization that, on or before January 1, 1991, provides not more than 10 outpatient holding beds for short-term and hospice-type patients in an ambulatory care facility for its members, provided that such health maintenance organization maintains current accreditation by the Joint Commission on Accreditation of Health Care Organizations, the Accreditation Association for Ambulatory Health Care, or the National Committee for Quality Assurance.

History.--ss. 21, 27, ch. 87-236; s. 1, ch. 90-213; ss. 187, 188, ch. 91-108; ss. 84, 91, ch. 91-282; s. 4, ch. 91-429; s. 3, ch. 95-281; s. 32, ch. 96-199; s. 6, ch. 97-159; s. 186, ch. 97-264; s. 28, ch. 98-159; s. 57, ch. 99-3.

641.51  Quality assurance program; second medical opinion requirement.--

(1)  The organization shall ensure that the health care services provided to subscribers shall be rendered under reasonable standards of quality of care consistent with the prevailing standards of medical practice in the community.

(2)  Each organization shall have an ongoing internal quality assurance program for its health care services. The program shall include, but not be limited to, the following:

(a)  A written statement of goals and objectives which stress health outcomes as the principal criteria for the evaluation of the quality of care rendered to subscribers;

(b)  A written statement describing how state-of-the-art methodology has been incorporated into an ongoing system for monitoring of care which is individual case oriented and, when implemented, can provide interpretation and analysis of patterns of care rendered to individual patients by individual providers;

(c)  Written procedures for taking appropriate remedial action whenever, as determined under the quality assurance program, inappropriate or substandard services have been provided or services which should have been furnished have not been provided;

(d)  A written plan for providing review of physicians and other licensed medical providers which includes ongoing review within the organization.

(3)  The professional judgment of a physician licensed under chapter 458, chapter 459, chapter 460, or chapter 461 concerning the proper course of treatment of a subscriber shall not be subject to modification by the organization or its board of directors, officers, or administrators, unless the course of treatment prescribed is inconsistent with the prevailing standards of medical practice in the community. However, this subsection shall not be considered to restrict a utilization management program established by an organization.

(4)(a)  Each organization shall give the subscriber the right to a second medical opinion in any instance in which the subscriber disputes the organization's or the physician's opinion of the reasonableness or necessity of surgical procedures or is subject to a serious injury or illness.

(b)  The second opinion, if requested, is to be provided by a physician chosen by the subscriber who may select:

1.  A contract or employed physician listed in a directory that shall be provided by the organization; or

2.  A noncontract physician located in the same geographical service area of the organization.

(c)  For second opinions provided by contract physicians the organization is prohibited from charging a fee to the subscriber in an amount in excess of the subscriber fees established by contract for referral contract physicians. The organization shall pay the amount of all charges, which are usual, reasonable, and customary in the community, for second opinion services performed by a physician not under contract with the organization, but may require the subscriber to be responsible for up to 40 percent of such amount. The organization may require that any tests deemed necessary by a noncontract physician shall be conducted by the organization. The organization may deny reimbursement rights granted under this section in the event the subscriber seeks in excess of three such referrals per year if such subsequent referral costs are deemed by the organization to be evidence that the subscriber has unreasonably overutilized the second opinion privilege. A subscriber thus denied reimbursement under this section shall have recourse to grievance procedures as specified in ss. 408.7056, 641.495, and 641.511. The organization's physician's professional judgment concerning the treatment of a subscriber derived after review of a second opinion shall be controlling as to the treatment obligations of the health maintenance organization. Treatment not authorized by the health maintenance organization shall be at the subscriber's expense.

(5)  Each organization shall develop and maintain a policy to determine when exceptional referrals to out-of-network specially qualified providers should be provided to address the unique medical needs of a subscriber. All financial arrangements for the provision of these services shall be agreed to prior to the services being rendered.

(6)  Each organization shall develop and maintain written policies and procedures for the provision of standing referrals to subscribers with chronic and disabling conditions which require ongoing specialty care.

¹(7)  When a contract between an organization and a treating provider is terminated for any reason other than for cause, each party shall allow subscribers for whom treatment was active to continue coverage and care when medically necessary, through completion of treatment of a condition for which the subscriber was receiving care at the time of the termination, until the subscriber selects another treating provider, or during the next open enrollment period offered by the organization, whichever is longer, but not longer than 6 months after termination of the contract. Each party to the terminated contract shall allow a subscriber who has initiated a course of prenatal care, regardless of the trimester in which care was initiated, to continue care and coverage until completion of postpartum care. This does not prevent a provider from refusing to continue to provide care to a subscriber who is abusive, noncompliant, or in arrears in payments for services provided. For care continued under this subsection, the organization and the provider shall continue to be bound by the terms of the terminated contract. Changes made within 30 days before termination of a contract are effective only if agreed to by both parties.

(8)  Each organization shall release to the agency data that are indicators of access and quality of care. The agency shall develop rules specifying data-reporting requirements for these indicators. The indicators shall include the following characteristics:

(a)  They must relate to access and quality of care measures.

(b)  They must be consistent with data collected pursuant to accreditation activities and standards.

(c)  They must be consistent with frequency requirements under the accreditation process.

(d)  They must include measures of the management of chronic diseases.

(e)  They must include preventive health care for adults and children.

(f)  They must include measures of prenatal care.

(g)  They must include measures of health checkups for children.

The agency shall develop by rule a uniform format for publication of the data for the public which shall contain explanations of the data collected and the relevance of such data. The agency shall publish such data no less frequently than every 2 years.

(9)  Each organization shall adopt recommendations for preventive pediatric health care which are consistent with the requirements for health checkups for children developed for the Medicaid program. Each organization shall establish goals to achieve 80-percent compliance by July 1, 1998, and 90-percent compliance by July 1, 1999, for their enrolled pediatric population.

²(10)  Each organization shall allow, without prior authorization, a female subscriber, to visit a contracted obstetrician/gynecologist for one annual visit and for medically necessary followup care detected at that visit. Nothing in this subsection shall prevent an organization from requiring that an obstetrician/gynecologist treating a covered patient coordinate the medical care through the patient's primary care physician, if applicable.

History.--ss. 21, 27, ch. 87-236; ss. 187, 188, ch. 91-108; ss. 85, 91, ch. 91-282; s. 4, ch. 91-429; s. 7, ch. 97-159; s. 58, ch. 99-3; s. 3, ch. 99-264; s. 14, ch. 99-356; s. 7, ch. 99-393.

¹Note.--Section 6, ch. 99-264, provides that "[t]his act shall take effect [June 8, 1999] and shall apply only to contracts entered into after the effective date."

²Note.--Section 15, ch. 99-356, provides that "[t]his act shall take effect July 1, 1999, except that sections 10 and 11 of this act shall take effect October 1, 1999, and shall apply to contracts issued or renewed on or after that date." The language of s. 15 appears as included in Senate Amendment 1E to H.B. 2231, which became ch. 99-356 (see Journal of the Senate 1999, p. 1433). This amendment failed to account for the effect of Senate Amendment 1D in adding 3 additional sections to the bill, causing the original ss. 10 and 11 to be renumbered as ss. 13 and 14. As enacted, ss. 10 and 11, ch. 99-356, appear at ss. 381.1001 and 381.102, respectively.

641.511  Subscriber grievance reporting and resolution requirements.--

(1)  Every organization must have a grievance procedure available to its subscribers for the purpose of addressing complaints and grievances. Every organization must notify its subscribers that a subscriber must submit a grievance within 1 year after the date of occurrence of the action that initiated the grievance, and may submit the grievance for review to the Statewide Provider and Subscriber Assistance Program panel as provided in s. 408.7056 after receiving a final disposition of the grievance through the organization's grievance process. An organization shall maintain records of all grievances and shall report annually to the agency the total number of grievances handled, a categorization of the cases underlying the grievances, and the final disposition of the grievances.

(2)  When an organization receives an initial complaint from a subscriber, the organization must respond to the complaint within a reasonable time after its submission. At the time of receipt of the initial complaint, the organization shall inform the subscriber that the subscriber has a right to file a written grievance at any time and that assistance in preparing the written grievance shall be provided by the organization.

(3)  Each organization's grievance procedure, as required under subsection (1), must include, at a minimum:

(a)  An explanation of how to pursue redress of a grievance.

(b)  The names of the appropriate employees or a list of grievance departments that are responsible for implementing the organization's grievance procedure. The list must include the address and the toll-free telephone number of each grievance department, the address of the agency and its toll-free telephone hotline number, and the address of the Statewide Provider and Subscriber Assistance Program and its toll-free telephone number.

(c)  The description of the process through which a subscriber may, at any time, contact the toll-free telephone hotline of the agency to inform it of the unresolved grievance.

(d)  A procedure for establishing methods for classifying grievances as urgent and for establishing time limits for an expedited review within which such grievances must be resolved.

(e)  A notice that a subscriber may voluntarily pursue binding arbitration in accordance with the terms of the contract if offered by the organization, after completing the organization's grievance procedure and as an alternative to the Statewide Provider and Subscriber Assistance Program. Such notice shall include an explanation that the subscriber may incur some costs if the subscriber pursues binding arbitration, depending upon the terms of the subscriber's contract.

(f)  A process whereby the grievance manager acknowledges the grievance and investigates the grievance in order to notify the subscriber of a final decision in writing.

(g)  A procedure for providing individuals who are unable to submit a written grievance with access to the grievance process, which shall include assistance by the organization in preparing the grievance and communicating back to the subscriber.

(4)(a)  With respect to a grievance concerning an adverse determination, an organization shall make available to the subscriber a review of the grievance by an internal review panel; such review must be requested within 30 days after the organization's transmittal of the final determination notice of an adverse determination. A majority of the panel shall be persons who previously were not involved in the initial adverse determination. A person who previously was involved in the adverse determination may appear before the panel to present information or answer questions. The panel shall have the authority to bind the organization to the panel's decision.

(b)  An organization shall ensure that a majority of the persons reviewing a grievance involving an adverse determination are providers who have appropriate expertise. An organization shall issue a copy of the written decision of the review panel to the subscriber and to the provider, if any, who submits a grievance on behalf of a subscriber. In cases where there has been a denial of coverage of service, the reviewing provider shall not be a provider previously involved with the adverse determination.

(c)  An organization shall establish written procedures for a review of an adverse determination. Review procedures shall be available to the subscriber and to a provider acting on behalf of a subscriber.

(d)  In any case when the review process does not resolve a difference of opinion between the organization and the subscriber or the provider acting on behalf of the subscriber, the subscriber or the provider acting on behalf of the subscriber may submit a written grievance to the Statewide Provider and Subscriber Assistance Program.

(5)  Except as provided in subsection (6), the organization shall resolve a grievance within 60 days after receipt of the grievance, or within a maximum of 90 days if the grievance involves the collection of information outside the service area. These time limitations are tolled if the organization has notified the subscriber, in writing, that additional information is required for proper review of the grievance and that such time limitations are tolled until such information is provided. After the organization receives the requested information, the time allowed for completion of the grievance process resumes.

(6)(a)  An organization shall establish written procedures for the expedited review of an urgent grievance. A request for an expedited review may be submitted orally or in writing and shall be subject to the review procedures of this section, if it meets the criteria of this section. Unless it is submitted in writing, for purposes of the grievance reporting requirements in subsection (1), the request shall be considered an appeal of a utilization review decision and not a grievance. Expedited review procedures shall be available to a subscriber and to the provider acting on behalf of a subscriber. For purposes of this subsection, "subscriber" includes the legal representative of a subscriber.

(b)  Expedited reviews shall be evaluated by an appropriate clinical peer or peers. The clinical peer or peers shall not have been involved in the initial adverse determination.

(c)  In an expedited review, all necessary information, including the organization's decision, shall be transmitted between the organization and the subscriber, or the provider acting on behalf of the subscriber, by telephone, facsimile, or the most expeditious method available.

(d)  In an expedited review, an organization shall make a decision and notify the subscriber, or the provider acting on behalf of the subscriber, as expeditiously as the subscriber's medical condition requires, but in no event more than 72 hours after receipt of the request for review. If the expedited review is a concurrent review determination, the service shall be continued without liability to the subscriber until the subscriber has been notified of the determination.

(e)  An organization shall provide written confirmation of its decision concerning an expedited review within 2 working days after providing notification of that decision, if the initial notification was not in writing.

(f)  An organization shall provide reasonable access, not to exceed 24 hours after receiving a request for an expedited review, to a clinical peer who can perform the expedited review.

(g)  In any case when the expedited review process does not resolve a difference of opinion between the organization and the subscriber or the provider acting on behalf of the subscriber, the subscriber or the provider acting on behalf of the subscriber may submit a written grievance to the Statewide Provider and Subscriber Assistance Program.

(h)  An organization shall not provide an expedited retrospective review of an adverse determination.

(7)  Each organization shall send to the agency a copy of its quarterly grievance reports submitted to the Department of Insurance pursuant to s. 408.7056(12).

(8)  The agency shall investigate all reports of unresolved quality of care grievances received from:

(a)  Annual and quarterly grievance reports submitted by the organization to the Department of Insurance.

(b)  Review requests of subscribers whose grievances remain unresolved after the subscriber has followed the full grievance procedure of the organization.

(9)(a)  The agency shall advise subscribers with grievances to follow their organization's formal grievance process for resolution prior to review by the Statewide Provider and Subscriber Assistance Program. The subscriber may, however, submit a copy of the grievance to the agency at any time during the process.

(b)  Requiring completion of the organization's grievance process before the Statewide Provider and Subscriber Assistance Program panel's review does not preclude the agency from investigating any complaint or grievance before the organization makes its final determination.

(10)  Each organization must notify the subscriber in a final decision letter that the subscriber may request review of the organization's decision concerning the grievance by the Statewide Provider and Subscriber Assistance Program, as provided in s. 408.7056, if the grievance is not resolved to the satisfaction of the subscriber. The final decision letter must inform the subscriber that the request for review must be made within 365 days after receipt of the final decision letter, must explain how to initiate such a review, and must include the addresses and toll-free telephone numbers of the agency and the Statewide Provider and Subscriber Assistance Program.

(11)  The agency may impose administrative sanction, in accordance with s. 641.52, against an organization for noncompliance with this section.

History.--ss. 86, 91, ch. 91-282; s. 4, ch. 91-429; s. 8, ch. 97-159; s. 2, ch. 98-10.

641.512  Accreditation and external quality assurance assessment.--

(1)(a)  To promote the quality of health care services provided by health maintenance organizations and prepaid health clinics in this state, the department shall require each health maintenance organization and prepaid health clinic to be accredited within 1 year of the organization's receipt of its certificate of authority and to maintain accreditation by an accreditation organization approved by the department, as a condition of doing business in the state.

(b)  In the event that no accreditation organization can be approved by the department, the department shall require each health maintenance organization and prepaid health clinic to have an external quality assurance assessment performed by a review organization approved by the department, as a condition of doing business in the state. The assessment shall be conducted within 1 year of the organization's receipt of its certificate of authority and every 2 years thereafter, or when the department deems additional assessments necessary.

(2)  The accreditation or review organization must have nationally recognized experience in health maintenance organization activities and in the appraisal of medical practice and quality assurance in a health maintenance organization setting. The accreditation or review organization shall not currently be involved in the operation of the health maintenance organization or prepaid health clinic, nor in the delivery of health care services to its subscribers. The accreditation or review organization shall not have contracted or conducted consultations within the last 2 years for other than accreditation purposes of the health maintenance organization or prepaid health clinic seeking accreditation or under quality assurance assessment.

(3)  A representative of the department shall accompany the accreditation or review organization throughout the accreditation or assessment process, but shall not participate in the final accreditation or assessment determination. The accreditation or review organization shall monitor and evaluate the quality and appropriateness of patient care, the organization's pursuance of opportunities to improve patient care and resolve identified problems, and the effectiveness of the internal quality assurance program required for health maintenance organization and prepaid health clinic certification pursuant to s. 641.49(3)(p).

(4)  The accreditation or assessment process shall include a review of:

(a)  All documentation necessary to determine the current professional credentials of employed health care providers or physicians providing service under contract to the health maintenance organization or prepaid health clinic.

(b)  At least a representative sample of not fewer than 50 medical records of individual subscribers. When selecting a sample, any and all medical records may be subject to review. The sample of medical records shall be representative of all subscribers' records.

(5)  Every organization shall submit its books, documentations, and medical records and take appropriate action as may be necessary to facilitate the accreditation or assessment process.

(6)  The accreditation or review organization shall issue a written report of its findings to the health maintenance organization's or prepaid health clinic's board of directors. A copy of the report shall be submitted to the department by the organization within 30 business days of its receipt by the health maintenance organization or prepaid health clinic.

(7)  The expenses of the accreditation or assessment process of each organization, including any expenses incurred pursuant to this section, shall be paid by the organization.

History.--ss. 87, 91, ch. 91-282; s. 4, ch. 91-429; s. 59, ch. 99-3.

641.513  Requirements for providing emergency services and care.--

(1)  In providing for emergency services and care as a covered service, a health maintenance organization may not:

(a)  Require prior authorization for the receipt of prehospital transport or treatment or for emergency services and care.

(b)  Indicate that emergencies are covered only if care is secured within a certain period of time.

(c)  Use terms such as "life threatening" or "bona fide" to qualify the kind of emergency that is covered.

(d)  Deny payment based on the subscriber's failure to notify the health maintenance organization in advance of seeking treatment or within a certain period of time after the care is given.

(2)  Prehospital and hospital-based trauma services and emergency services and care must be provided to a subscriber of a health maintenance organization as required under ss. 395.1041, 395.4045, and 401.45.

(3)(a)  When a subscriber is present at a hospital seeking emergency services and care, the determination as to whether an emergency medical condition, as defined in s. 641.47 exists shall be made, for the purposes of treatment, by a physician of the hospital or, to the extent permitted by applicable law, by other appropriate licensed professional hospital personnel under the supervision of the hospital physician. The physician or the appropriate personnel shall indicate in the patient's chart the results of the screening, examination, and evaluation. The health maintenance organization shall compensate the provider for the screening, evaluation, and examination that is reasonably calculated to assist the health care provider in arriving at a determination as to whether the patient's condition is an emergency medical condition. The health maintenance organization shall compensate the provider for emergency services and care. If a determination is made that an emergency medical condition does not exist, payment for services rendered ¹subsequent to that determination is governed by the contract under which the subscriber is covered.

(b)  If a determination has been made that an emergency medical condition exists and the subscriber has notified the hospital, or the hospital emergency personnel otherwise have knowledge that the patient is a subscriber of the health maintenance organization, the hospital must make a reasonable ²attempt to notify the subscriber's primary care physician, if known, or the health maintenance organization, if the health maintenance organization had previously requested in writing that the notification be made directly to the health maintenance organization, of the existence of the emergency medical condition. If the primary care physician is not known, or has not been contacted, the hospital must:

1.  Notify the health maintenance organization as soon as possible ³prior to discharge of the subscriber from the emergency care area; or

2.  Notify the health maintenance organization within 24 hours or on the next business day after admission of the subscriber as an inpatient to the hospital.

⁴If notification required by this paragraph is not accomplished, the hospital must document its attempts to notify the health maintenance organization of the circumstances that precluded attempts to notify the health maintenance organization. A health maintenance organization may not deny payment for emergency services and care based on a hospital's failure to comply with the notification requirements of this paragraph. Nothing in this paragraph shall alter any contractual responsibility of a subscriber to make contact with the health maintenance organization, subsequent to receiving treatment for the emergency medical condition.

(c)  If the subscriber's primary care physician responds to the notification, the hospital physician and the primary care physician may discuss the appropriate care and treatment of the subscriber. The health maintenance organization may have a member of the hospital staff with whom it has a contract participate in the treatment of the subscriber within the scope of the physician's hospital staff privileges. The subscriber may be transferred, in accordance with state and federal law, to a hospital that has a contract with the health maintenance organization and has the service capability to treat the subscriber's emergency medical condition. ⁵Notwithstanding any other state law, a hospital may request and collect insurance or financial information from a patient in accordance with federal law, which is necessary to determine if the patient is a subscriber of a health maintenance organization, if emergency services and care are not delayed.

⁶(4)  A subscriber may be charged a reasonable copayment, as provided in s. 641.31(12), for the use of an emergency room.

⁶(5)  Reimbursement for services pursuant to this section by a provider who does not have a contract with the health maintenance organization shall be the lesser of:

(a)  The provider's charges;

(b)  The usual and customary provider charges for similar services in the community where the services were provided; or

(c)  The charge mutually agreed to by the health maintenance organization and the provider within 60 days of the submittal of the claim.

Such reimbursement shall be net of any applicable copayment authorized pursuant to subsection (4).

⁷(6)  Reimbursement for services under this section provided to subscribers who are Medicaid recipients by a provider for whom no contract exists between the provider and the health maintenance organization shall be the lesser of:

(a)  The provider's charges;

(b)  The usual and customary provider charges for similar services in the community where the services were provided;

(c)  The charge mutually agreed to by the entity and the provider within 60 days after submittal of the claim; or

(d)  The Medicaid rate.

History.--s. 33, ch. 96-199; s. 9, ch. 96-223.

¹Note.--As created by s. 33, ch. 96-199. Section 641.513(3)(a) as created by s. 9, ch. 96-223, uses the word "after" instead of the words "subsequent to."

²Note.--As created by s. 33, ch. 96-199. Section 641.513(3)(d) as created by s. 9, ch. 96-223, uses the word "effort" instead of "attempt."

³Note.--As created by s. 33, ch. 96-199. Section 641.513(3)(b)1. as created by s. 9, ch. 96-223, uses the words "before discharging" instead of the words "prior to discharge of."

⁴Note.--As created by s. 33, ch. 96-199. As created by s. 9, ch. 96-223, this sentence reads: "If the notification required by this paragraph is not given, the hospital must document the circumstances that precluded efforts to notify the health maintenance organization."

⁵Note.--As created by s. 33, ch. 96-199. As created by s. 9, ch. 96-223, this sentence reads: "Notwithstanding any other state law, and if emergency services and care are not delayed, a hospital may request and collect insurance information or other financial information from a patient in accordance with federal law if the information is necessary to determine whether the patient is a subscriber of a health maintenance organization."

⁶Note.--As created by s. 33, ch. 96-199. As created by s. 9, ch. 96-223, s. 641.513(4) and (5) read:

(4)  A subscriber may be charged a reasonable copayment, as provided in s. 641.31(12), for the use of an emergency room, except for Medicaid recipients. Nothing in this section is intended to prohibit or limit application of a nominal copayment as provided in s. 409.9081 for the use of an emergency room for services other than emergency services and care.

(5)  Reimbursement for services under this section provided to subscribers who are not Medicaid recipients by a provider for whom no contract exists between the provider and the health maintenance organization shall be the lesser of:

(a)  The provider's charges;

(b)  The usual and customary provider charges for similar services in the community where the services were provided; or

(c)  The charge mutually agreed to by the health maintenance organization and the provider within 60 days after the submittal of the claim.


Such reimbursement shall be net of any applicable copayment authorized pursuant to subsection (4).

⁷Note.--As created by s. 9, ch. 96-223.

641.515  Investigation by the agency.--

(1)  The agency shall investigate further any quality of care issue contained in recommendations and reports submitted pursuant to ss. 408.7056 and 641.511. The agency shall also investigate further any information that indicates that the organization does not meet accreditation standards or the standards of the review organization performing the external quality assurance assessment pursuant to reports submitted under s. 641.512. Every organization shall submit its books and records and take other appropriate action as may be necessary to facilitate an examination. The agency shall have access to the organization's medical records of individuals and records of employed and contracted physicians, with the consent of the subscriber or by court order, as necessary to carry out the provisions of this part.

(2)  The reports and the records prepared or obtained under this section or s. 641.512 by the agency or by an outside source may be used by the agency in enforcing the requirements of this part and in disciplinary proceedings. Except as otherwise provided in this section, any patient-identifying information contained in these records and reports is confidential and exempt from s. 119.07(1).

(3)  If the agency, through its examination or through any investigation, has a reasonable belief that conduct by a staff member or any other employee of an organization may constitute grounds for disciplinary action by the appropriate regulatory board, the agency shall report this fact to such regulatory board.

(4)  The agency shall promulgate rules imposing upon physicians and hospitals performing services for a health maintenance organization standards of care generally applicable to physicians and hospitals.

History.--ss. 21, 27, ch. 87-236; ss. 187, 188, ch. 91-108; ss. 88, 91, ch. 91-282; s. 4, ch. 91-429; s. 1, ch. 93-85; s. 34, ch. 96-199; s. 399, ch. 96-406; s. 60, ch. 99-3.

641.52  Revocation of certificate; suspension of new enrollment; suspension of the health care provider certificate; administrative fine; notice of action to the Department of Insurance; penalty for use of unlicensed providers.--

(1)  The agency may suspend the authority of an organization to enroll new subscribers or revoke the health care provider certificate of any organization, or order compliance within a time certain, if it finds that any of the following conditions exist:

(a)  The organization is in substantial violation of its contracts.

(b)  The organization is unable to fulfill its obligations under outstanding contracts entered into with its subscribers.

(c)  The organization knowingly utilizes a provider who is furnishing or has furnished health care services and who does not have a subsisting license or other authority to practice or furnish health care services in this state.

(d)  The organization no longer meets the requirements for the certificate as originally issued.

(e)  The organization has violated any lawful rule or order of the agency or any provision of this part.

(f)  The organization has refused to be examined or to produce its accounts, records, and files for examination or to perform any other legal obligation as to such examination, when required by the agency.

(g)  The organization has not, after given reasonable notice, maintained accreditation or received favorable external quality assurance reviews under s. 641.512 or, following an investigation under s. 641.515, has been determined to not materially meet requirements under this part.

(2)  Revocation of an organization's certificate shall be for a period of 2 years. After 2 years, the organization may apply for a new certificate by compliance with all application requirements applicable to first-time applicants.

(3)  Suspension of an organization's authority to enroll new subscribers shall be for such period, not to exceed 1 year, as is fixed by the agency. The agency shall, in its order suspending the authority of an organization to enroll new subscribers, specify the period during which the suspension is to be in effect and the conditions, if any, which must be met by the organization prior to reinstatement of its authority to enroll new subscribers. The order of suspension is subject to rescission or modification by further order of the agency prior to the expiration of the suspension period. Authority to enroll new subscribers shall not be reinstated unless requested by the organization; however, the agency may not grant reinstatement if it finds that the circumstances for which the suspension of authority to enroll new subscribers occurred still exist or are likely to recur.

(4)  The agency may suspend the health care provider certificate issued to an organization. The agency shall, in its order suspending the health care provider certificate, specify the period during which the suspension is to be in effect and the conditions, if any, which must be met by the organization for reinstatement. Upon expiration of the suspension period, the organization's certificate automatically reinstates unless the agency finds that the causes of the suspension have not been removed or that the organization is otherwise not in compliance with this part. If the agency makes such a finding, the health care provider certificate shall not be reinstated and is considered to have expired as of the end of the suspension period.

(5)  If the agency finds that one or more grounds exist for the revocation or suspension of a certificate issued under this part, the agency may, in lieu of such revocation or suspension, impose a fine upon the organization. With respect to any nonwillful violation, the fine may not exceed $2,500 per violation. Such fines may not exceed an aggregate amount of $25,000 for all nonwillful violations arising out of the same action. With respect to any knowing and willful violation of a lawful order or rule of the agency or a provision of this part, the agency may impose a fine upon the organization in an amount not to exceed $20,000 for each such violation. Such fines may not exceed an aggregate amount of $250,000 for all knowing and willful violations arising out of the same action. The agency shall, by January 1, 1997, adopt by rule penalty categories that specify varying ranges of fines for willful violations and for nonwillful violations.

(6)  The agency shall immediately notify the Department of Insurance whenever it issues an administrative complaint or an order or otherwise initiates legal proceedings resulting in or which may result in suspension or revocation of an organization's health care provider certificate or suspension of new enrollment.

(7)  Any organization that knowingly utilizes the services of a provider who is not licensed or otherwise authorized by law to provide such services is guilty of a felony of the third degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.

History.--ss. 21, 27, ch. 87-236; ss. 187, 188, ch. 91-108; ss. 89, 91, ch. 91-282; s. 4, ch. 91-429; s. 35, ch. 96-199.

641.54  Information disclosure.--

(1)  Every health maintenance organization shall maintain a current list, by geographic area, of all hospitals which are routinely and regularly used by the organization, indicating to which hospitals the organization may refer particular subscribers for nonemergency services. The list shall also include all physicians under the organization's direct employ or who are under contract or other arrangement with the organization to provide health care services to subscribers. The list shall contain the following information for each physician:

(a)  Name.

(b)  Office location.

(c)  Medical area or areas of specialty.

(d)  Board certification or eligibility in any area.

(e)  License number.

(2)  The list shall be made available, upon request, to the department. The list shall also be made available, upon request:

(a)  With respect to negotiation, application, or effectuation of a group health maintenance contract, to the employer or other person who will hold the contract on behalf of the subscriber group. The list may be restricted to include only physicians and hospitals in the group's geographic area.

(b)  With respect to an individual health maintenance contract or any contract offered to a person who is entitled to have payments for health care costs made under Medicare, to the person considering or making application to, or under contract with, the health maintenance organization. The list may be restricted to include only physicians and hospitals in the person's geographic area.

(3)  The organization shall make available to subscribers, upon request, a detailed description of the authorization and referral process for health care services. Any changes in the organization's authorization and referral process shall be reported to the agency immediately.

(4)  The organization shall make available to subscribers, upon request, a detailed description of the process used to determine whether health care services are "medically necessary." Any change in the organization's definition of "medically necessary" or the process used to determine medical necessity shall be reported to the agency immediately.

(5)  Each organization shall provide to subscribers, upon request, the following:

(a)  A description of the organization's quality assurance program.

(b)  Policies and procedures relating to the organization's prescription drug benefits, including the disclosure, upon request of a subscriber or potential subscriber, of whether the organization uses a formulary. A subscriber or potential subscriber may also request information as to whether a specific drug is covered by the organization.

(c)  Policies and procedures relating to the confidentiality and disclosure of the subscriber's medical records.

(d)  The decisionmaking process used for approving or denying experimental or investigational medical treatments.

(e)  Policies and procedures for addressing the needs of non-English-speaking subscribers.

(f)  A detailed description of the process used to examine qualifications of and the credentialing of all providers under contract with or employed by the organization.

History.--ss. 31, 47, ch. 85-177; s. 22, ch. 87-236; ss. 187, 188, ch. 91-108; s. 91, ch. 91-282; s. 4, ch. 91-429; s. 9, ch. 97-159.

Note.--Former s. 641.3109.

641.545  Subscriber risk assessments; requirements.--The agency shall require an organization, when providing services to Medicaid subscribers, to attempt, at least twice if necessary, to contact each new Medicaid subscriber within 3 months after the Medicaid subscriber enrolls, in order to perform a health risk assessment. The health risk assessment instrument must include questions regarding early and periodic screening, diagnosis, and treatment history of Medicaid subscribers who are under 21 years of age and questions regarding pregnancy history. The organization shall ask Medicaid subscribers to release to the plan or its providers medical records from providers who treated the Medicaid subscribers before their enrollment with the organization. The organization must use the health risk assessments and the released medical records to identify Medicaid subscribers who have not received screenings in the past according to the agency-approved periodic schedule. The organization must contact, up to twice if necessary, any Medicaid subscriber who is more than 2 months behind in the periodic screening schedule to urge that Medicaid subscriber or the Medicaid subscriber's responsible party to make an appointment for a screening visit. The agency shall require each organization, for its Medicaid subscribers, to report its early and periodic screening, diagnosis, and treatment rate, the trimester of pregnancy when prenatal care began, and the rate of low birth weight babies born to the organization's Medicaid subscribers. The agency shall monitor the organization's compliance with this section.

History.--s. 36, ch. 96-199.

641.55  Internal risk management program.--

(1)  Every organization certified under this part shall, as a part of its administrative functions, establish an internal risk management program which shall include the following components:

(a)  The investigation and analysis of the frequency and causes of general categories and specific types of adverse incidents causing injury to patients;

(b)  The development of appropriate measures to minimize the risk of injuries and adverse incidents to patients, including risk management and risk prevention education and training of all nonphysician personnel as follows:

1.  Such education and training of all nonphysician personnel as part of their initial orientation; and

2.  At least 1 hour of such education and training annually for all nonphysician personnel of the organization who work in clinical areas and provide patient care;

(c)  The analysis of patient grievances which relate to patient care and the quality of medical services; and

(d)  The development and implementation of an incident reporting system based upon the affirmative duty of all providers and all agents and employees of the organization to report injuries and adverse incidents to the risk manager.

(2)  The risk management program shall be the responsibility of the governing authority or board of the organization. Every organization which has an annual premium volume of $10 million or more and which directly provides health care in a building owned or leased by the organization shall hire a risk manager, certified under ss. 395.10971-395.10975, who shall be responsible for implementation of the organization's risk management program required by this section. A part-time risk manager shall not be responsible for risk management programs in more than four organizations or facilities. Every organization which does not directly provide health care in a building owned or leased by the organization and every organization with an annual premium volume of less than $10 million shall designate an officer or employee of the organization to serve as the risk manager.

(3)  In addition to the programs mandated by this section, other innovative approaches intended to reduce the frequency and severity of medical malpractice and patient injury claims shall be encouraged and their implementation and operation facilitated. Additional approaches may include extending risk management programs to provider offices or facilities.

(4)  The Agency for Health Care Administration shall adopt rules necessary to carry out the provisions of this section, including rules governing the establishment of required internal risk management programs to meet the needs of individual organizations and each specific organization type governed by this part. The Department of Insurance shall assist the agency in preparing these rules. Each internal risk management program shall include the use of incident reports to be filed with the risk manager. The risk manager shall have free access to all organization or provider medical records. The incident reports shall be considered to be a part of the workpapers of the attorney defending the organization in litigation relating thereto and shall be subject to discovery, but not be admissible as evidence in court, nor shall any person filing an incident report be subject to civil suit by virtue of the incident report and the matters it contains. As a part of each internal risk management program, the incident reports shall be utilized to develop categories of incidents which identify problem areas. Once identified, procedures must be adjusted to correct these problem areas.

(5)(a)  Each organization subject to this section must submit an annual report to the agency summarizing the incident reports that were filed in the organization during the preceding calendar year pertaining to services rendered on the premises of the organization. The report must be on a form prescribed by rule of the agency and must include, with respect to medical services rendered on the premises of the organization:

1.  The total number of adverse incidents causing injury to patients.

2.  A listing, by category, of the types of operations, diagnostic or treatment procedures, or other actions causing the injuries and the number of incidents occurring within each category.

3.  A listing, by category, of the types of injuries caused and the number of incidents occurring within each category.

4.  The name of each provider or a code number using each health care professional's license number and a separate code number identifying all other individuals directly involved in adverse incidents causing injury to a patient, the relationship of the individual or provider to the organization, and the number of incidents with the organization in which each individual or provider has been directly involved. Each organization must maintain names of the health care professionals and individuals identified by code numbers for purposes of this section.

5.  A description of all medical malpractice claims filed against the organization or its providers, including the total number of pending and closed claims and the nature of the incident that led to, the persons involved in, and the status and disposition of each claim. Each report must update status and disposition for all prior reports.

6.  A report of all disciplinary actions taken against any provider or any medical staff member of the organization, including the nature and cause of the action.

(b)  The information reported to the agency under paragraph (a) which relates to providers licensed under chapter 458, chapter 459, chapter 461, or chapter 466 must also be reported to the agency quarterly. The agency shall review the information and determine whether any of the incidents potentially involved conduct by a licensee that is subject to disciplinary action, in which case s. 455.621 applies.

(c)  Except as otherwise provided in this subsection, any identifying information contained in the annual report and the quarterly reports under paragraphs (a) and (b) is confidential and exempt from s. 119.07(1). This information must not be available to the public as part of the record of investigation for and prosecution in disciplinary proceedings made available to the public by the agency or the appropriate regulatory board. However, the agency shall make available, upon written request by a practitioner against whom probable cause has been found, any such information contained in the records that form the basis of the determination of probable cause under s. 455.621.

(d)  The annual report shall also contain the name of the risk manager of the organization, a copy of its policy and procedures governing the measures taken by the organization and its risk manager to reduce the risk of injuries and adverse or untoward incidents, and the result of these measures.

(6)  If an adverse or untoward incident, whether occurring in the facilities of the organization or arising from health care prior to enrollment by the organization or admission to the facilities of the organization or in a facility of one of its providers, results in:

(a)  The death of a patient;

(b)  Severe brain or spinal damage to a patient;

(c)  A surgical procedure being performed on the wrong patient; or

(d)  A surgical procedure unrelated to the patient's diagnosis or medical needs being performed on any patient,

the organization must report this incident to the agency within 3 working days after its occurrence. A more detailed followup report must be submitted to the agency within 10 days after the first report. The agency may require an additional, final report. Reports under this subsection must be sent immediately by the agency to the appropriate regulatory board whenever they contain references to a provider licensed under chapter 458, chapter 459, chapter 461, or chapter 466. These reports are confidential and are exempt from s. 119.07(1). This information is not available to the public as part of the record of investigation for and prosecution in disciplinary proceedings made available to the public by the agency or the appropriate regulatory board. However, the agency shall make available, upon written request by a practitioner against whom probable cause has been found, any such information contained in the records that form the basis of the determination of probable cause under s. 455.621. The agency may investigate, as it deems appropriate, any such incident and prescribe measures that must or may be taken by the organization in response to the incident. The agency shall review each incident and determine whether it potentially involved conduct by the licensee which is subject to disciplinary action, in which case s. 455.621 applies.

(7)  In addition to any penalty imposed under s. 641.52, the agency may impose an administrative fine, not to exceed $5,000, for any violation of the reporting requirements of subsection (5) or subsection (6).

(8)  The agency and, upon subpoena issued under s. 455.611, the appropriate regulatory board must be given access to all organization records necessary to carry out the provisions of this section. Any identifying information contained in the records obtained under this section is confidential and exempt from s. 119.07(1). The identifying information contained in records obtained under s. 455.611 is exempt from s. 119.07(1) to the extent that it is part of the record of investigation for and prosecution in disciplinary proceedings made available to the public by the agency or the appropriate regulatory board. However, the agency must make available, upon written request by a practitioner against whom probable cause has been found, any such information contained in the records that form the basis of the determination of probable cause under s. 455.621, except that, with respect to medical review committee records, s. 766.101 controls.

(9)  The agency shall review, no less frequently than annually, the risk management program of each organization regulated by this section to determine whether the program meets standards established in statutes and rules, whether the program is being conducted in a manner designed to reduce adverse incidents, and whether the program is appropriately reporting incidents under subsections (5) and (6).

(10)  There shall be no monetary liability on the part of, and no cause of action for damages shall arise against, any risk manager certified under part IX of chapter 626 for the implementation and oversight of the risk management program in an organization authorized under this chapter for any act or proceeding undertaken or performed within the scope of the function of such risk management program if the risk manager acts without intentional fraud.

(11)  If the agency, through its receipt of the annual reports prescribed in subsection (5) or through any investigation, has a reasonable belief that conduct by a provider, staff member, or employee of an organization may constitute grounds for disciplinary action by the appropriate regulatory board, the agency shall report this fact to the regulatory board.

(12)  The agency shall send information bulletins to all organizations as necessary to disseminate trends and preventive data derived from its actions under this section or under s. 395.0197.

The gross data compiled under this section or s. 395.0197 shall be furnished by the agency upon request to organizations to be utilized for risk management purposes. The agency shall adopt rules necessary to carry out the provisions of this section.

History.--ss. 46, 54, ch. 85-175; s. 7, ch. 86-287; s. 23, ch. 87-236; s. 44, ch. 88-1; s. 23, ch. 88-277; ss. 187, 188, ch. 91-108; s. 11, ch. 91-110; s. 91, ch. 91-282; s. 4, ch. 91-429; s. 91, ch. 92-289; s. 2, ch. 93-85; s. 228, ch. 94-218; s. 85, ch. 95-211; s. 37, ch. 96-199; s. 400, ch. 96-406; s. 40, ch. 98-89; s. 163, ch. 98-166.

Note.--Former s. 641.395.

641.56  Rulemaking authority.--The Agency for Health Care Administration has authority to adopt rules pursuant to ss. 120.536(1) and 120.54 to implement the provisions of this part conferring duties upon it.

History.--ss. 24, 27, ch. 87-236; ss. 187, 188, ch. 91-108; s. 91, ch. 91-282; s. 4, ch. 91-429; s. 38, ch. 96-199; s. 215, ch. 98-200.

641.57  Disposition of moneys collected under this part.--Fees, administrative penalties, examination expenses, and other sums collected by the Agency for Health Care Administration under this part shall be deposited to the credit of the Health Care Trust Fund to be administered by the agency and shall be used to defray the expenses of the agency in the discharge of its administrative and regulatory powers and duties as prescribed by this part, including the maintaining of offices and necessary supplies, essential equipment and other materials, salaries and expenses of required personnel, and all other legitimate expenses relating to the discharge of the administrative and regulatory powers and duties imposed under such laws.

History.--ss. 25, 27, ch. 87-236; ss. 187, 188, ch. 91-108; s. 91, ch. 91-282; s. 4, ch. 91-429; s. 39, ch. 96-199; s. 26, ch. 96-418.

641.58  Regulatory assessment; levy and amount; use of funds; tax returns; penalty for failure to pay.--

(1)  In addition to any other license or excise tax now or hereafter imposed, and such taxes as may be imposed under other statutes, there is hereby assessed and imposed upon every organization authorized to engage in business in this state, an annual regulatory assessment not to exceed 0.1 percent of the gross amount of premiums collected by each organization on contracts or certificates issued to subscribers in this state. For the purpose of this section, "premium" shall include all prepaid per capita fees and prepaid aggregate fees, by whatever name called. The assessment shall be payable annually on or before April 1 to the Agency for Health Care Administration by each organization on such premiums collected during the preceding calendar year, and shall be deposited into the Health Care Trust Fund.

(2)  The Department of Insurance shall determine the amount of gross premiums for the purposes of the regulatory assessment, and then the agency shall determine on or before December 1 of each year the regulatory assessment percentage necessary to be imposed for that calendar year, payable on or before the following April 1, as herein prescribed, to provide the funds appropriated to the agency to carry out the provisions of subsection (4).

(3)  The agency shall make and issue its order setting the regulatory assessment percentage for that calendar year, payable on or before April 1 of the following year, and shall mail a copy of such order to each organization.

(4)  The moneys received and deposited into the Health Care Trust Fund shall be used to defray the expenses of the agency in the discharge of its administrative and regulatory powers and duties under this part, including conducting an annual survey of the satisfaction of members of health maintenance organizations; contracting with physician consultants for the Statewide Provider and Subscriber Assistance Panel; maintaining offices and necessary supplies, essential equipment, and other materials, salaries and expenses of required personnel; and discharging the administrative and regulatory powers and duties imposed under this part.

(5)  If, at the end of any fiscal year, an unencumbered balance of funds received from the regulatory assessment imposed by this section remains in the Health Care Trust Fund, such balance shall not revert to the General Revenue Fund of the state, but shall be retained in the Health Care Trust Fund to be used for the purposes set forth above. The agency shall take into account the amount of any such remaining funds when determining the regulatory assessment percentage for each calendar year.

(6)  Tax returns with respect to the regulatory assessment prescribed by this section shall be made by each organization liable for payment of such tax on forms to be prescribed by the agency and sworn to by one or more of the executive officers or other persons charged under the law with the management of the organization. In the event of an overpayment on account of the assessment, a refund of the overpayment may be made to the remitter.

(7)  If an organization fails to pay the assessment required by this section on or before April 1 of each year, the agency may suspend or revoke its health care provider certificate or impose other reasonable administrative sanctions or penalties.

History.--ss. 26, 27, ch. 87-236; ss. 187, 188, ch. 91-108; s. 91, ch. 91-282; s. 4, ch. 91-429; s. 51, ch. 95-211; s. 40, ch. 96-199; s. 27, ch. 96-418; s. 8, ch. 99-393.

641.59  Psychotherapeutic services; records and reports.--A health maintenance organization or prepaid health clinic, as defined in this chapter, must maintain strict confidentiality against unauthorized or inadvertent disclosure of confidential information to persons inside or outside the health maintenance organization or prepaid health clinic regarding psychotherapeutic services provided to subscribers by psychotherapists licensed under chapter 490 or chapter 491 and psychotherapeutic records and reports related to the services. A report, in lieu of records, may be submitted by a psychotherapist in support of the services. Such report must include clear statements summarizing the subscriber's presenting symptoms, what transpired in any provided therapy, what progress, if any, was made by the subscriber, and results obtained. However, the health maintenance organization or prepaid health clinic may require the records upon which the report is based, if the report does not contain sufficient information supporting the services. A psychotherapist submitting records in support of services may obscure portions to conceal the names, identities, or identifying information of people other than the subscriber if this information is unnecessary to utilization review, quality management, discharge planning, case management, or claims processing conducted by the health maintenance organization or prepaid health clinic. A health maintenance organization or prepaid health clinic may provide aggregate data which does not disclose subscriber identities or identities of other persons to entities such as payors, sponsors, researchers, and accreditation bodies.

History.--s. 1, ch. 96-180.

641.60  Statewide Managed Care Ombudsman Committee.--

(1)  As used in ss. 641.60-641.75:

(a)  "Agency" means the Agency for Health Care Administration.

(b)  "Covered medical service" means a service that has been contracted for under the managed care program agreement.

(c)  "District" means one of the health service planning districts as defined in s. 408.032.

(d)  "District committee" means a district managed care ombudsman committee.

(e)  "Enrollee" means an individual who has contracted, or on whose behalf a contract has been entered into, with a managed care program for health care.

(f)  "Managed care program" means a health care delivery system that emphasizes primary care and integrates the financing and delivery of services to enrolled individuals through arrangements with selected providers, formal quality assurance and utilization review, and financial incentives for enrollees to use the program's providers. Such a health care delivery system may include arrangements in which providers receive prepaid set payments to coordinate and deliver all inpatient and outpatient services to enrollees or arrangements in which providers receive a case management fee to coordinate services and are reimbursed on a fee-for-service basis for the services they provide. A managed care program may include a state-licensed health maintenance organization, a Medicaid prepaid health plan, a Medicaid primary care case management program, or other similar program.

(g)  "Physician" means a person licensed under chapter 458, chapter 459, chapter 460, or chapter 461.

(h)  "Statewide committee" means the Statewide Managed Care Ombudsman Committee.

(2)  There is created within the Agency for Health Care Administration a Statewide Managed Care Ombudsman Committee. The statewide committee shall act as a consumer protection and advocacy organization on behalf of all health care consumers receiving services through managed care programs in the state. The statewide committee shall work in conjunction with the agency in protecting the public health, safety, and welfare, as provided under this section and ss. 641.65, 641.70, and 641.75. The statewide committee shall have administrative authority over the district committees established in s. 641.65.

(3)  The statewide committee shall consist of the chairpersons of the district committees.

(4)  The members of the statewide committee shall elect a chairperson to a term of 1 year. A person may not serve as chairperson for more than two consecutive terms.

(5)(a)  Members of the statewide committee shall receive no compensation, but may be reimbursed for travel expenses in accordance with s. 112.061.

(b)  Travel expenses for the statewide committee shall be funded from the Health Care Trust Fund created by s. 408.16. The statewide committee may solicit grants, gifts, donations, bequests, or other payments including money, property, or services from any governmental or public entity or private entity or person to fund other expenses of the committee and the district committees. Any such moneys received shall be deposited into a trust fund administered by the agency.

(6)  The statewide committee or a member of the committee:

(a)  Shall serve as a volunteer organization to protect the rights of all enrollees participating in managed care programs in this state.

(b)  Shall receive complaints regarding quality of care from the agency, and may assist the agency with the investigation and resolution of complaints.

(c)  May conduct site visits with the agency, as the agency determines is appropriate.

(d)  May review existing and new or revised managed care quality assurance programs of the agency and make recommendations as to how the rights of managed care enrollees are affected by such programs.

(e)  May submit a report to the Legislature, no later than January 1, as appropriate, concerning activities, recommendations, and complaints reviewed or developed by the statewide committee and district committees during the preceding year.

(f)  Shall conduct meetings at least two times a year at the call of the chairperson and at other times at the call of the agency director or by written request of three members.

(g)  Shall adopt agency guidelines to carry out its purposes and responsibilities and those of the district committees.

(h)  Shall monitor the district committees and provide technical assistance to members of district committees.

History.--s. 1, ch. 96-391; s. 12, ch. 97-270; s. 175, ch. 98-166.

641.61  Subscriber satisfaction assessment.--Each organization must establish systems for:

(1)  Assessing subscriber satisfaction with providers, particularly primary care physicians;

(2)  Sharing subscriber-satisfaction indicators and scores with providers;

(3)  Publicly acknowledging providers with high positive subscriber-satisfaction scores;

(4)  Addressing behaviors of providers with low subscriber-satisfaction scores; and

(5)  Assessing subscriber access and physician availability.

History.--s. 41, ch. 96-199.

641.62  Chronic diseases among subscriber populations.--Each organization must:

(1)  Annually study its subscriber population to determine the most prevalent chronic diseases of its subscribers, design intervention strategies to reduce the morbidities and mortalities associated with at least two prevalent chronic diseases, measure the outcomes of the interventions implemented, and modify the interventions, if necessary, to improve their effectiveness;

(2)  Request the input and assistance of its providers and share the information developed under subsection (1) with its providers; and

(3)  Share the information developed under subsections (1) and (2) with subscribers identified as having these chronic diseases.

History.--s. 42, ch. 96-199.

641.65  District managed care ombudsman committees.--

(1)  A district managed care ombudsman committee is created in each district of the agency that has staff assigned for the regulation of managed care programs. Each district committee is subject to direction from and the supervision of the statewide committee.

(2)  Each district committee shall have no fewer than 9 members and no more than 16 members, including at least: one physician licensed under chapter 458, one physician licensed under chapter 459, one physician licensed under chapter 460, and one physician licensed under chapter 461, one psychologist, one registered nurse, one clinical social worker, one attorney, and one consumer. For the consumer member, preference shall be given to members of organized consumer or advocacy groups with national or statewide membership. No member may be employed by or affiliated with a managed care program.

(3)(a)  The agency director shall appoint the first three members of each district committee, and those three members shall select the remaining members, subject to approval of the agency director. If any of the first three members are not appointed within 60 days after the statewide committee is established and after a request is submitted to the agency director, those members shall be appointed by a majority vote of the statewide committee without further action by the agency director.

(b)  Members shall be appointed to serve for a term of 3 years, except that at the time of initial appointment, terms shall be staggered so the first 40 percent of members appointed shall serve for a term of 2 years and the remaining members shall serve for a term of 3 years. Members may serve only two consecutive terms.

(c)  Upon the expiration of the term of a member or upon the occurrence of a vacancy, the district committee shall appoint a successor, subject to the approval of the agency director.

(d)  If the agency director fails to approve or disapprove a replacement member within 30 days after the district committee provides the agency director with a nomination, the nomination is automatically approved.

(4)  Each district committee shall elect a chairperson for a term of 1 year. A person may not serve as chairperson for more than two consecutive terms.

(5)  If a district committee member misses, without cause, two-thirds of the regular district committee meetings in a calendar year, the member is automatically removed, and the district committee shall select a replacement.

(6)  Each district committee or member of the committee:

(a)  Shall serve to protect the health, safety, and rights of all enrollees participating in managed care programs in this state.

(b)  Shall receive complaints regarding quality of care from the agency, and may assist the agency with the resolution of complaints.

(c)  May conduct site visits with the agency, as the agency determines is appropriate. A complaint may be referred by the agency to the committee, as to whether an enrollee's managed care program may have inappropriately denied the enrollee a covered medical service, may be inappropriately delaying the provision of a covered medical service to the enrollee, or is providing substandard covered medical services. The committee shall establish and follow uniform criteria in reviewing information and receiving complaints.

(d)  Shall submit an annual report to the statewide committee concerning activities, recommendations, and complaints reviewed or developed by the district committee during the year.

(e)  Shall conduct meetings as required at the call of its chairperson, the call of the agency director, the call of the statewide committee, or by written request of a majority of the district committee members.

History.--s. 2, ch. 96-391.

641.67  Statewide or district managed care ombudsman committee; exemption from public records requirements; exceptions.--

(1)  The following information is confidential and exempt from the provisions of s. 119.07(1) and s. 24(a), Art. I of the State Constitution:

(a)  Patient records held by the statewide or a district managed care ombudsman committee created under s. 641.60 or s. 641.65.

(b)  The name or identity of a complainant who files a complaint with the statewide or a district managed care ombudsman committee, including any problem identified by the ombudsman committee as a result of an investigation, unless the complainant provides written consent that authorizes the release of his or her name or unless a court of competent jurisdiction orders that the name or identity of a complainant be disclosed.

Exemptions created under this subsection are subject to the Open Government Sunset Review Act of 1995, in accordance with s. 119.15, and shall stand repealed on October 2, 2002, unless reviewed and saved from repeal by reenactment of the Legislature.

(2)  The Legislature finds that it is a public necessity that patient records and any other identifying information concerning a complainant held by the statewide or a district managed care ombudsman committee be held confidential and exempt from the public records law. The Legislature finds that the citizens of Florida benefit from the thorough investigation and prompt resolution of complaints regarding the quality of care provided by managed care programs. Investigation of complaints regarding quality of care often requires careful review of a patient's medical record. Such records, as well as other information contained in the complaint, often concern matters of a personal and private nature. Disclosure to the public of a patient's medical record, a complainant's identity, or other personal information would significantly discourage the filing of complaints. Consequently, the quality of care provided to the public would suffer. Therefore, the Legislature finds that the harm to the individual and the public in disclosing patient records and identifying information substantially outweighs the public benefit in allowing such disclosure.

History.--s. 1, ch. 97-106.

641.68  Statewide or district managed care ombudsman committee; exemption from public meeting requirements.--

(1)  That portion of a committee meeting conducted by the statewide or a district managed care ombudsman committee created under s. 641.60 or s. 641.65, where patient records and information identifying a complainant are discussed, is exempt from the provisions of s. 286.011 and s. 24(b), Art. I of the State Constitution. The exemption created under this subsection is subject to the Open Government Sunset Review Act of 1995, in accordance with s. 119.15, and shall stand repealed on October 2, 2002, unless reviewed and saved from repeal by reenactment of the Legislature.

(2)  The exemption created under subsection (1) overrides the important public policy of public access to portions of certain public discussions of governmental agencies because of the need to maintain consistency in the law relating to the management and handling of information of a personal and sensitive nature involving private individuals. It is important that the statewide or a district managed care ombudsman committee be able to discuss such personal and sensitive information in detail so that an accurate evaluation can be made of the facts contained in a complaint. Dissemination to the public of information about a health maintenance organization or other managed care organization that is obtained through a complaint would have a chilling effect on the willingness of persons with knowledge of any substandard quality-of-care activities of such organizations to provide such information to the statewide or a district managed care ombudsman committee. Based on the evaluation of such committees, certain remedial actions may be required of health maintenance organizations or other managed care organizations which will serve to enhance overall quality of care rendered by any specific company involved and potentially the entire managed care industry. Furthermore, such information may provide grounds for investigation by the Agency for Health Care Administration or may assist the agency in carrying out its responsibilities of protecting the public.

History.--s. 2, ch. 97-106.

641.70  Agency duties relating to the Statewide Managed Care Ombudsman Committee and the district managed care ombudsman committees.--

(1)  The agency shall adopt rules that specify:

(a)  Procedures by which the statewide committee and district committees receive reports of enrollee complaints from the agency.

(b)  Procedures by which enrollee information shall be made available to members of the statewide committee and to the district committees.

(c)  Procedures by which recommendations made by the committees shall be considered for incorporation into policies and procedures of the agency.

(d)  Procedures by which statewide committee members shall be reimbursed for authorized expenditures.

(e)  Any other procedures that are necessary to administer this section and ss. 641.60 and 641.65.

(2)  The Agency for Health Care Administration shall provide a meeting place for district committees in agency offices and shall provide the necessary administrative support to assist the statewide committee and district committees, within available resources.

(3)  The director of the agency shall ensure the full cooperation and assistance of agency employees with members of the statewide committee and district committees.

History.--s. 3, ch. 96-391.

641.75  Immunity from liability; limitation on testimony.--

(1)  Any member of the statewide committee or a district committee who receives or investigates a complaint of an enrollee of a managed care program in accordance with the procedures and guidelines of the agency shall be immune from liability for good faith action on behalf of such an enrollee.

(2)  Except as otherwise provided by law, all other matters before the statewide committee or district committees shall be open to the public and subject to chapter 119 and s. 286.011.

(3)  Members of any state or district ombudsman committee shall not be required to testify in any court with respect to matters held to be confidential except as may be necessary to enforce ss. 641.60-641.75.

History.--s. 4, ch. 96-391.