The Florida Senate

641.22  Issuance of certificate of authority.--The office 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 office'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 office shall not grant or continue authority to transact the business of a health maintenance organization in this state at any time during which the office 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 office, 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 office of such person upon discovery of the conditions set forth in this paragraph, either when applicable to such person or upon order of the office. 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 office, and obtained approval from the office 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; s. 1560, ch. 2003-261.