Senate Bill 1432
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Florida Senate - 1998 SB 1432
By Senator Brown-Waite
10-890A-98
1 A bill to be entitled
2 An act relating to the delivery of health care
3 services; redesignating part III of ch. 641,
4 F.S., as part IV, and creating a new part III
5 of ch. 641, F.S., the "Provider-Sponsored
6 Organization Act"; providing legislative
7 findings and purposes with respect to certain
8 federal requirements for authorizing
9 provider-sponsored organizations in this state
10 to provide health care coverage to Medicare
11 beneficiaries under the Medicare Choice plan;
12 providing definitions; exempting
13 provider-sponsored organizations from certain
14 provisions of the Florida Insurance Code;
15 requiring the incorporation of any
16 provider-sponsored organization doing business
17 in this state; prohibiting a provider-sponsored
18 organization from transacting insurance
19 business other than the offering of Medicare
20 Choice plans; providing for determining the
21 types of activities that require licensure by
22 the Department of Insurance; requiring that a
23 provider-sponsored organization obtain a
24 certificate of authority from the department;
25 specifying conditions precedent to issuance or
26 maintenance of a certificate of authority;
27 providing surplus requirements for a
28 provider-sponsored organization that offers the
29 Medicare Choice plan; requiring that a
30 provider-sponsored organization deposit a
31 specified amount into the Rehabilitation
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1 Administrative Expense Fund of the Department
2 of Insurance; requiring that a
3 provider-sponsored organization maintain a
4 valid health care provider certificate;
5 specifying circumstances under which the
6 department may suspend a provider-sponsored
7 organization's authority to enroll new
8 subscribers; providing contract requirements;
9 authorizing the department to impose
10 administrative penalties in lieu of suspension
11 or revocation of a certificate; providing
12 requirements for any acquisition, merger, or
13 consolidation of a provider-sponsored
14 organization; requiring that a
15 provider-sponsored organization file an annual
16 report; providing penalties; requiring
17 examinations by the department; providing for
18 civil remedies and injunctive relief; providing
19 for the payment of a judgment by a
20 provider-sponsored organization; specifying the
21 delinquency proceedings that are the sole means
22 of liquidating, reorganizing, rehabilitating,
23 or conserving a provider-sponsored
24 organization; providing filing fees; providing
25 for the application of other laws; authorizing
26 the Division of Insurance Fraud of the
27 department to investigate violations of part
28 III of ch. 641, F.S.; prohibiting certain
29 unfair practices in a provider-sponsored
30 contract with respect to exposure to the human
31 immunodeficiency virus infection and related
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1 matters; providing requirements for contracts
2 and advertisements used by a provider-sponsored
3 organization; providing marketing standards and
4 requirements; providing requirements for
5 provider-sponsored contracts, certificates, and
6 member handbooks; requiring a
7 provider-sponsored organization to make certain
8 disclosures to prospective enrollees; requiring
9 coverage for mammograms; providing requirements
10 with respect to the treatment of breast cancer
11 and followup care; providing requirements for
12 contracts between a provider-sponsored
13 organization and a provider of health care
14 services; prohibiting a provider-sponsored
15 organization from using certain words
16 descriptive of the insurance business;
17 providing requirements for assets, liabilities,
18 and investments of a provider-sponsored
19 organization; requiring the Department of
20 Insurance to adopt rules; providing certain
21 limitations on the payment of dividends by a
22 provider-sponsored organization; specifying
23 prohibited activities; providing penalties;
24 requiring that an agent who solicits contracts
25 and performs other activities be licensed and
26 appointed as a health insurance agent;
27 prohibiting certain unfair methods of
28 competition and unfair or deceptive acts or
29 practices; authorizing the department to
30 conduct examinations and investigations;
31 providing for administrative hearings;
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1 authorizing the department to issue cease and
2 desist orders and impose penalties; providing
3 for appeals of a department order; providing
4 penalties for violating a cease and desist
5 order; providing that an action by the
6 department does not abrogate the right to other
7 relief; amending s. 641.227, F.S.; providing
8 for deposits into the Rehabilitation
9 Administrative Expense Fund by a
10 provider-sponsored organization; providing for
11 reimbursements; amending s. 641.316, F.S.,
12 relating to fiscal intermediary services;
13 providing for application to provider-sponsored
14 organizations; amending ss. 641.47, 641.48,
15 641.49, 641.495, F.S., relating to definitions,
16 purpose and application, and certification
17 requirements; providing for certain provisions
18 regulating health care services to apply to
19 provider-sponsored organizations; amending s.
20 641.51, F.S.; providing requirements for
21 provider-sponsored organizations in requiring
22 second medical opinions; amending s. 641.512,
23 F.S.; requiring that a provider-sponsored
24 organization obtain accreditation; amending s.
25 641.513, F.S.; providing requirements for
26 provider-sponsored organizations in providing
27 emergency services and care; amending s.
28 641.515, F.S.; authorizing the Agency for
29 Health Care Administration to adopt rules with
30 respect to services performed for a
31 provider-sponsored organization; amending s.
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1 641.54, F.S.; providing requirements for a
2 provider-sponsored organization in making
3 referrals; amending s. 641.59, F.S.; providing
4 requirements for psychotherapeutic services;
5 amending s. 641.60, F.S.; providing for a
6 managed care program to include a
7 provider-sponsored organization for purposes of
8 the Statewide Managed Care Ombudsman Committee;
9 providing an effective date.
10
11 Be It Enacted by the Legislature of the State of Florida:
12
13 Section 1. The Division of Statutory Revision is
14 requested to redesignate part III of chapter 641, Florida
15 Statutes, as part IV of that chapter, and a new part III of
16 chapter 641, Florida Statutes, consisting of sections
17 641.4601, 641.4602, 641.4603, 641.4604, 641.4605, 641.4606,
18 641.4607, 641.4608, 641.4609, 641.4610, 641.4611, 641.4612,
19 641.4613, 641.4614, 641.4615, 641.4616, 641.4617, 641.4618,
20 641.4619, 641.4620, 641.4621, 641.4622, 641.4623, 641.4624,
21 641.4625, 641.4626, 641.4627, 641.4628, 641.4629, 641.4630,
22 641.4631, 641.4632, 641.4633, 641.4634, 641.4635, 641.4636,
23 641.4637, 641.4638, 641.4639, 641.4640, 641.4641, 641.4642,
24 641.4643, 641.4644, 641.4645, 641.4646, 641.4647, and
25 641.4648, Florida Statutes, is created to read:
26 Section 641.4601 Short title.--This part may be cited
27 as the "Provider-Sponsored Organization Act."
28 Section 641.4602 Declaration of legislative findings
29 and purposes.--
30 (1) The Legislature finds that a major restructuring
31 of health care has taken place which has changed the way in
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1 which health care services are paid for and delivered. Today,
2 the emphasis is on providing cost-conscious health care
3 services through managed care. The Legislature recognizes that
4 alternative methods for the delivery of health care are needed
5 to promote competition and increase patients' choices.
6 (2) The Legislature recognizes that the United States
7 Congress has enacted legislation that allows
8 provider-sponsored organizations to provide coordinated-care
9 plans to Medicare enrollees through the Medicare Choice
10 program. The federal legislation requires any organization
11 that offers a Medicare Choice plan to be organized under state
12 law as an entity eligible to offer health-benefit coverage in
13 the state in which it offers a Medicare Choice plan.
14 (3) The Legislature finds that these plans, when
15 properly operated, will enhance the quality of controls,
16 ensuring that the provider has control over medical
17 decisionmaking while emphasizing effective cost and quality
18 control.
19 (4) Therefore, it is the policy of this state:
20 (a) To eliminate legal barriers to the organization,
21 promotion, and expansion of provider-sponsored organizations
22 that offer Medicare Choice plans in order to encourage the
23 development of valuable options for the Medicare beneficiaries
24 of this state.
25 (b) Not to extend insurance regulation or onerous
26 reporting requirements to hospitals, physicians, single or
27 multiple-specialty groups, other licensed providers, or any
28 combination of such entities when contracting with entities
29 licensed under chapter 627 or part I or when contracting with
30 plans qualified and created under the Employee Retirement
31 Income Security Act of 1974.
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1 (c) To recognize that comprehensive provider-sponsored
2 organizations are exempt from the insurance laws of this state
3 except in the manner and to the extent set forth in this part.
4 641.4603 Definitions.--As used in this part, the term:
5 (1) "Affiliation" means a relationship between
6 providers in which, through contract, ownership, or otherwise:
7 (a) One provider, directly or indirectly, controls, is
8 controlled by, or is under common control with the other;
9 (b) Both providers are part of a controlled group of
10 corporations under s. 1563 of the Internal Revenue Code of
11 1986;
12 (c) Each provider is a participant in a lawful
13 combination under which each provider shares substantial
14 financial risk in connection with the organization's
15 operations; or
16 (d) Both providers are part of an affiliated service
17 group under s. 414 of the Internal Revenue Code of 1986.
18 (2) "Agency" means the Agency for Health Care
19 Administration.
20 (3) "Comprehensive health care services" means
21 services, medical equipment, and supplies required under the
22 Medicare Choice program.
23 (4) "Copayment" means a specific dollar amount that
24 the subscriber must pay upon receipt of covered health care
25 services as required or authorized under the Medicare Choice
26 program.
27 (5) "Department" means the Department of Insurance.
28 (6) "Emergency medical condition" means:
29 (a) A medical condition that manifests itself by acute
30 symptoms of sufficient severity, which may include severe pain
31 or other acute symptoms, such that the absence of immediate
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1 medical attention could reasonably be expected to result in
2 any of the following:
3 1. Serious jeopardy to the health of a patient,
4 including a pregnant woman or a fetus.
5 2. Serious impairment of bodily functions.
6 3. Serious dysfunction of any bodily organ or part.
7 (b) With respect to a pregnant woman:
8 1. That there is inadequate time to effect safe
9 transfer to another hospital prior to delivery;
10 2. That a transfer may pose a threat to the health and
11 safety of the patient or fetus; or
12 3. That there is evidence of the onset and persistence
13 of uterine contractions or rupture of the membranes.
14 (7) "Emergency services and care" means medical
15 screening, examination, and evaluation by a physician, or, to
16 the extent permitted by applicable law, by other appropriate
17 personnel under the supervision of a physician, to determine
18 if an emergency medical condition exists and, if it does, the
19 care, treatment, or surgery for a covered service by a
20 physician necessary to relieve or eliminate the emergency
21 medical condition, within the service capability of a
22 hospital.
23 (8) "Entity" means any legal entity with continuing
24 existence, including, but not limited to, a corporation,
25 association, trust, or partnership.
26 (9) "Geographic area" means the county or counties, or
27 any portion of a county or counties, within which the
28 organization provides or arranges for comprehensive health
29 care services to be available to its subscribers.
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1 (10) "Provider-sponsored contract" means any contract
2 entered into by a provider-sponsored organization that serves
3 Medicare Choice beneficiaries.
4 (11) "Provider-sponsored organization" means any
5 organization authorized under this part which:
6 (a) Is established, organized, and operated by a
7 health care provider or group of affiliated health care
8 providers;
9 (b) Provides a substantial proportion of the health
10 care items and services specified in the Medicare Choice
11 contract, as defined by the Secretary of the United States
12 Department of Health and Human Services, directly through the
13 provider or affiliated group of providers; and
14 (c) Shares, with respect to its affiliated providers,
15 directly or indirectly, substantial financial risk in the
16 provision of such items and services and has at least a
17 majority financial interest in the entity.
18
19 The term "substantial proportion" shall be defined by the
20 Secretary of the United States Department of Health and Human
21 Services after having taken into account the need for such an
22 organization to assume responsibility for providing
23 significantly more than the majority of the items and services
24 under the Medicare Choice contract through its own affiliated
25 providers and the remainder of the items and services under
26 such contract through providers with which the organization
27 has an agreement to provide such items and services.
28 Consideration will also be given to the need for the
29 organization to provide a limited proportion of the items and
30 services under the contract through entities that are neither
31 affiliated with nor have an agreement with the organization.
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1 Additionally, some variation in the definition of substantial
2 proportion may be allowed based upon relevant differences
3 among the organizations, such as their location in an urban or
4 rural area.
5 (12) "Insolvent" or "insolvency" means that all the
6 statutory assets of the provider-sponsored organization, if
7 made immediately available, would not be sufficient to
8 discharge all of its liabilities or that the
9 provider-sponsored organization is unable to pay its debts as
10 they become due in the usual course of business.
11 (13) "Provider" means any physician, hospital, or
12 other institution, organization, or person that furnishes
13 health care services and is licensed or otherwise authorized
14 to practice in the state.
15 (14) "Reporting period" means the annual accounting
16 period or any part thereof or the fiscal year of the
17 provider-sponsored organization.
18 (15) "Statutory accounting principles" means generally
19 accepted accounting principles, except as modified by this
20 part.
21 (16) "Subscriber" means a Medicare Choice enrollee who
22 is eligible for coverage as a Medicare beneficiary.
23 (17) "Surplus" means total assets in excess of total
24 liabilities as determined by the federal rules on solvency
25 standards established by the Secretary of the United States
26 Department of Health and Human Services pursuant to s. 1856(a)
27 of the Balanced Budget of 1997, for provider-sponsored
28 organizations that offer the Medicare Choice plan.
29 641.4604 Applicability of other laws.--Except as
30 provided in this part, provider-sponsored organizations shall
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1 be governed by this part and part IV and are exempt from all
2 other provisions of the Florida Insurance Code.
3 641.4605 Incorporation required.--On or after October
4 1, 1998, any entity that has not yet obtained a certificate of
5 authority to operate a provider-sponsored organization in this
6 state shall be incorporated or shall be a division of a
7 corporation formed under chapter 607 or chapter 617 or shall
8 be a public entity that is organized as a political
9 subdivision. In the case of a division of a corporation, the
10 financial requirements of this part apply to the entire
11 corporation.
12 641.4606 Insurance business not authorized.--The
13 Florida Insurance Code or this part do not authorize any
14 provider-sponsored organization to transact any insurance
15 business other than to offer Medicare Choice plans pursuant to
16 s. 1855 of the Balanced Budget Act of 1997. In determining the
17 type of activities by a provider-sponsored organization which
18 require licensure by the department, the following shall
19 apply:
20 (1) A provider-sponsored organization as defined in
21 this part, a hospital, a physician licensed under chapter 458
22 or chapter 459, a single specialty group of physicians, a
23 multispecialty group of physicians, other licensed providers,
24 or any combination of the foregoing, when contracting with a
25 self-insured employer to provide health care benefits to its
26 employees, when contracting with a health maintenance
27 organization licensed under part I or a provider-sponsored
28 organization licensed under this part, or when contracting
29 with an insurer, are exempt from the requirements of this
30 chapter and chapter 627.
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1 (2) In all of the arrangements enumerated in
2 subsection (1), the provider group is not subject to
3 regulation by the department because there is no contractual
4 obligation to the employees covered under the self-insured
5 agreement or under the agreement with the health maintenance
6 organization, the provider-sponsored organization, or the
7 insurer. The contractual relationship exists only between the
8 provider group and the self-insured employer, the licensed
9 health maintenance organization, the provider-sponsored
10 organization, or the insurer, which entity continues to bear
11 full and direct responsibility to the individual with no
12 transfer of risk. If the provider group fails to perform, the
13 employer, health maintenance organization, provider-sponsored
14 organization, or insurer still retains the risk to either
15 provide or pay for health care services.
16 (3) The department has regulatory jurisdiction when
17 any health care provider group becomes the ultimate
18 risk-bearer and is directly obligated to individuals to
19 provide, arrange, or pay for health care services. In these
20 situations, the provider group must be appropriately licensed
21 as a health maintenance organization, a provider-sponsored
22 organization, or an insurance company.
23 641.4607 Application for certificate.--Before any
24 entity may operate a provider-sponsored organization, it must
25 obtain a certificate of authority from the department. The
26 department shall accept and shall immediately begin its review
27 of an application for a certificate of authority anytime after
28 an organization has filed an application for a health care
29 provider certificate pursuant to part IV. However, the
30 department may not issue a certificate of authority to any
31 applicant that does not possess a valid health care provider
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1 certificate issued by the agency. Each application for a
2 certificate must be on a form prescribed by the department,
3 must be verified by the oath of two officers of the
4 corporation and properly notarized, and must be accompanied
5 by:
6 (1) A copy of the articles of incorporation and all
7 amendments thereto;
8 (2) A copy of the bylaws, rules, and regulations, or
9 similar document, if any, regulating the conduct of the
10 affairs of the applicant;
11 (3) A list of the names, addresses, and official
12 capacities of the persons who are to be responsible for
13 conducting the affairs of the provider-sponsored organization,
14 including all officers, directors, and owners of in excess of
15 5 percent of the common stock of the corporation. Each such
16 person must fully disclose to the department and to the
17 directors of the provider-sponsored organization the extent
18 and nature of any contract or arrangement between him or her
19 and the provider-sponsored organization, including any
20 possible conflict of interest;
21 (4) A complete biographical statement on forms
22 prescribed by the department, and an independent investigation
23 report and fingerprints obtained pursuant to chapter 624, of
24 each individual listed in subsection (3);
25 (5) A statement generally describing the
26 provider-sponsored organization, its operations, and its
27 grievance procedures;
28 (6) A statement describing with reasonable certainty
29 the geographic area or areas to be served by the
30 provider-sponsored organization;
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1 (7) An audited financial statement prepared on the
2 basis of statutory accounting principles and certified by an
3 independent certified public accountant, except that surplus
4 notes that are acceptable to the department and meet the
5 requirements of this part shall be included in the calculation
6 of surplus; and
7 (8) Any additional data, financial statements, or
8 other pertinent information required by the department with
9 respect to determining whether the applicant can provide the
10 services to be offered, including a comprehensive feasibility
11 study, performed by a certified actuary in conjunction with a
12 certified public accountant. The feasibility study must cover
13 a period of 3 years or the period ending on the date that the
14 provider-sponsored organization projects that it will have
15 been profitable for 12 consecutive months, whichever period is
16 longer.
17 641.4608 Conditions precedent to issuance or
18 maintenance of certificate of authority; effect of bankruptcy
19 proceedings.--
20 (1) As a condition precedent to the issuance or
21 maintenance of a certificate of authority, a
22 provider-sponsored organization must file or have on file with
23 the department:
24 (a) An acknowledgment that a delinquency proceeding
25 pursuant to part I of chapter 631 or supervision by the
26 department pursuant to ss. 624.80-624.87 constitutes the sole
27 and exclusive method for the liquidation, rehabilitation,
28 reorganization, or conservation of a provider-sponsored
29 organization.
30 (b) A waiver of any right to file or be subject to a
31 bankruptcy proceeding.
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1 (2) The commencement of a bankruptcy proceeding either
2 by or against a provider-sponsored organization shall, by
3 operation of law:
4 (a) Terminate the provider-sponsored organization's
5 certificate of authority.
6 (b) Vest in the department for the use and benefit of
7 the subscribers of the provider-sponsored organization the
8 title to any deposits of the insurer held by the department.
9
10 If the proceeding is initiated by a party other than the
11 provider-sponsored organization, the operation of subsection
12 (2) shall be stayed for 60 days following the date of
13 commencement of the proceeding.
14 641.4609 Issuance of certificate of authority.--The
15 department shall, within 90 days after receipt, issue a
16 certificate of authority to any entity filing a completed
17 application in conformity with s. 641.4607, upon payment of
18 the prescribed fees and upon the department's being satisfied
19 that:
20 (1) As a condition precedent to the issuance of any
21 certificate, the entity has obtained a health care provider
22 certificate from the agency pursuant to part IV.
23 (2) The provider-sponsored organization is actuarially
24 sound.
25 (3) The entity has met the applicable requirements
26 specified in s. 641.4611.
27 (4) The procedures for offering comprehensive health
28 care services and offering and terminating contracts to
29 subscribers will not unfairly discriminate on the basis of
30 age, sex, race, health, or economic status.
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1 (5) The entity furnishes evidence of adequate
2 insurance coverage or an adequate plan for self-insurance to
3 respond to claims for injuries arising out of the furnishing
4 of comprehensive health care.
5 (6) The ownership, control, and management of the
6 entity is competent and trustworthy and possesses managerial
7 experience sufficient to make the proposed operation of the
8 provider-sponsored organization beneficial to the subscribers.
9 The department may not grant or continue authority to transact
10 the business of a provider-sponsored organization in this
11 state at any time during which the department has good reason
12 to believe that the ownership, control, or management of the
13 organization includes:
14 (a) Any person:
15 1. Who is incompetent or untrustworthy;
16 2. Who is so lacking in expertise as to make the
17 operation of the provider-sponsored organization hazardous to
18 potential and existing subscribers;
19 3. Who is so lacking in experience, ability, and
20 standing with respect to a provider-sponsored organization as
21 to jeopardize the reasonable promise of successful operation;
22 4. Who is affiliated, directly or indirectly, through
23 ownership, control, reinsurance transactions, or other
24 business relations, with any person whose business operations
25 are or have been marked by business practices or conduct that
26 is detrimental to the public, stockholders, investors, or
27 creditors; or
28 5. Whose business operations are or have been marked
29 by business practices or conduct that is detrimental to the
30 public, stockholders, investors, or creditors.
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1 (b) Any person, including any stock subscriber,
2 stockholder, or incorporator, who exercises or has the ability
3 to exercise effective control of the organization, or who
4 influences or has the ability to influence the transaction of
5 the business of the provider-sponsored organization, who does
6 not possess the financial standing and business experience for
7 the successful operation of the provider-sponsored
8 organization.
9 (c) Any person, including any stock subscriber,
10 stockholder, or incorporator, who exercises or has the ability
11 to exercise effective control of the organization, or who
12 influences or has the ability to influence the transaction of
13 the business of the provider-sponsored organization, who has
14 been found guilty of, or has pled guilty or no contest to, any
15 felony or crime punishable by imprisonment of 1 year or more
16 under the laws of the United States or any state thereof or
17 under the laws of any other country, which felony or crime
18 involves moral turpitude, without regard to whether a judgment
19 or conviction has been entered by the court having
20 jurisdiction in such case. However, in the case of a
21 provider-sponsored organization operating under a subsisting
22 certificate of authority, the provider-sponsored organization
23 shall remove any such person immediately upon discovery of the
24 conditions set forth in this paragraph when applicable to such
25 person or under the order of the department, and the failure
26 to so act by the organization is grounds for revocation or
27 suspension of the provider-sponsored organization's
28 certificate of authority.
29 (d) Any person, including any stock subscriber,
30 stockholder, or incorporator, who exercises or has the ability
31 to exercise effective control of the organization, or who
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1 influences or has the ability to influence the transaction of
2 the business of the provider-sponsored organization, who is
3 now or has in the past been affiliated, directly or
4 indirectly, through ownership interest of 10 percent or more,
5 control, or reinsurance transactions, with any business,
6 corporation, or other entity that has been found guilty of or
7 has pleaded guilty or nolo contendere to any felony or crime
8 punishable by imprisonment for 1 year or more under the laws
9 of the United States, any state, or any other country,
10 regardless of adjudication. In the case of a
11 provider-sponsored organization operating under a subsisting
12 certificate of authority, the provider-sponsored organization
13 shall immediately remove such person or immediately notify the
14 department of such person upon discovery of the conditions set
15 forth in this paragraph or upon order of the department. The
16 failure to remove such person, provide such notice, or comply
17 with such order constitutes grounds for suspension or
18 revocation of the provider-sponsored organization's
19 certificate of authority.
20 (7) The entity has a blanket fidelity bond in the
21 amount of $100,000, issued by a licensed insurance carrier in
22 this state, which will reimburse the entity in the event that
23 anyone handling the funds of the entity either misappropriates
24 or absconds with the funds. All employees handling the funds
25 shall be covered by the blanket fidelity bond. An agent
26 licensed under the Florida Insurance Code may either directly
27 or indirectly represent the provider-sponsored organization in
28 the solicitation, negotiation, effectuation, procurement,
29 receipt, delivery, or forwarding of any provider-sponsored
30 organization subscriber's contract or collect or forward any
31 consideration paid by the subscriber to the provider-sponsored
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1 organization, and the licensed agent is not required to post
2 the bond required by this subsection.
3 (8) The provider-sponsored organization has a
4 grievance procedure that will facilitate the resolution of
5 subscriber grievances and that includes both formal and
6 informal steps available within the organization.
7 641.4610 Continued eligibility for certificate of
8 authority.--In order to maintain its eligibility for a
9 certificate of authority, a provider-sponsored organization
10 must continue to meet all conditions required to be met under
11 this part and the rules adopted under this part for the
12 initial application for and issuance of its certificate of
13 authority under s. 641.4609.
14 641.4611 Surplus requirements.--Surplus requirements
15 for provider-sponsored organizations offering the Medicare
16 Choice plan must be consistent with the federal rules on
17 solvency standards established by the Secretary of the United
18 States Department of Health and Human Services pursuant to s.
19 1856(a) of the Balanced Budget Act of 1997.
20 641.4612 Rehabilitation Administrative Expense Fund.--
21 (1) The department may not issue or permit to exist a
22 certificate of authority to operate a provider-sponsored
23 organization in this state unless the organization has
24 deposited with the department $10,000 in cash for use in the
25 Rehabilitation Administrative Expense Fund as established in
26 s. 641.227.
27 (2) Upon successful rehabilitation of a
28 provider-sponsored organization, the organization shall
29 reimburse the fund for the amount of expenses incurred by the
30 department during the court-ordered rehabilitation period.
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1 (3) If a court of competent jurisdiction orders
2 liquidation of a provider-sponsored organization, the fund
3 shall be reimbursed for expenses incurred by the department as
4 provided for in chapter 631.
5 (4) Each deposit made under this section shall be
6 allowed as an asset for purposes of determining the financial
7 condition of the provider-sponsored organization. The deposit
8 shall be refunded to the organization only when the
9 organization both ceases operation as a provider-sponsored
10 organization and no longer holds a subsisting certificate of
11 authority.
12 641.4613 Revocation or cancellation of certificate of
13 authority; suspension of enrollment of new subscribers; terms
14 of suspension.--
15 (1) The maintenance of a valid and current health care
16 provider certificate issued pursuant to part IV is a condition
17 of the maintenance of a valid and current certificate of
18 authority issued by the department to operate a
19 provider-sponsored organization. Denial or revocation of a
20 health care provider certificate shall be deemed to be an
21 automatic and immediate cancellation of a provider-sponsored
22 organization's certificate of authority. At the discretion of
23 the department, nonrenewal of a health care provider
24 certificate may be deemed to be an automatic and immediate
25 cancellation of a provider-sponsored organization's
26 certificate of authority if the agency notifies the
27 department, in writing, that the health care provider
28 certificate will not be renewed.
29 (2) The department may suspend the authority of a
30 provider-sponsored organization to enroll new subscribers or
31 revoke any certificate issued to a provider-sponsored
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1 organization, or order compliance within 30 days, if it finds
2 that any of the following conditions exists:
3 (a) The organization is not operating in compliance
4 with this part.
5 (b) The plan is no longer actuarially sound or the
6 organization does not have the minimum surplus as required by
7 rules governing provider-sponsored organizations established
8 by the Secretary of United States Department of Health and
9 Human Services pursuant to s. 1856(a) of the Balanced Budget
10 Act of 1997.
11 (c) The organization has advertised, merchandised, or
12 attempted to merchandise its services in such a manner as to
13 misrepresent its service or capacity for service or has
14 engaged in deceptive, misleading, or unfair practices with
15 respect to advertising or merchandising.
16 (d) The organization is insolvent.
17 (3) Whenever the financial condition of the
18 provider-sponsored organization is such that, if not modified
19 or corrected, its continued operation would result in
20 impairment or insolvency, the department may order the
21 provider-sponsored organization to file with the department
22 and implement a corrective-action plan designed to do one or
23 more of the following:
24 (a) Reduce the total amount of present potential
25 liability for benefits by reinsurance or other means.
26 (b) Reduce the volume of new business being accepted.
27 (c) Reduce the expenses of the provider-sponsored
28 organization by specified methods.
29 (d) Suspend or limit the writing of new business for a
30 period of time.
31
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1 (e) Require an increase in the provider-sponsored
2 organization's net worth which increase is not inconsistent
3 with the standards established by the Secretary of the United
4 States Department of Health and Human Services pursuant to s.
5 1856(a) of the Balanced Budget Act of 1997.
6
7 If the provider-sponsored organization fails to submit a plan
8 within 30 days after the department's order or submits a plan
9 that is insufficient to correct the provider-sponsored
10 organization's financial condition, the department may order
11 the provider-sponsored organization to implement one or more
12 of the corrective actions listed in this subsection.
13 (4) The department shall, in its order suspending the
14 authority of a provider-sponsored organization to enroll new
15 subscribers, specify the period during which the suspension is
16 to be in effect and the conditions, if any, which must be met
17 by the provider-sponsored organization prior to reinstatement
18 of its authority to enroll new subscribers. The order of
19 suspension is subject to rescission or modification by further
20 order of the department prior to the expiration of the
21 suspension period. Reinstatement may not be made unless
22 requested by the provider-sponsored organization. However, the
23 department may not grant reinstatement if it finds that the
24 circumstances for which the suspension occurred still exist or
25 are likely to recur.
26 (5) The department shall calculate and publish at
27 least annually the medical loss ratios of all licensed
28 provider-sponsored organizations. The publication must include
29 an explanation of what the medical loss ratio means and shall
30 disclose that the medical loss ratio is not a direct measure
31
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1 of quality but must be looked at along with patient
2 satisfaction and other standards that define quality.
3 641.4614 Administrative, provider, and management
4 contracts.--
5 (1) The department may require a provider-sponsored
6 organization to submit to the department any contract for
7 administrative services or contract-management services or any
8 contract with an affiliated entity.
9 (2) After review of a contract, the department may
10 order the provider-sponsored organization to cancel the
11 contract in accordance with the terms of the contract and
12 applicable law if it determines that the fees to be paid by
13 the provider-sponsored organization under the contract are so
14 unreasonably high as compared with similar contracts entered
15 into by the provider-sponsored organization, or as compared
16 with similar contracts entered into by other
17 provider-sponsored organizations in similar circumstances,
18 that the contract is detrimental to the subscribers,
19 stockholders, investors, or creditors of the
20 provider-sponsored organization.
21 (3) All contracts for administrative services,
22 management services, and provider services, other than
23 individual physician contracts and contracts with affiliated
24 entities entered into or renewed by a provider-sponsored
25 organization on or after October 1, 1998, must contain a
26 provision that the contract shall be canceled upon issuance of
27 an order by the department pursuant to this section.
28 641.4615 Contract providers.--Each provider-sponsored
29 organization shall file, upon the request of the department,
30 financial statements for all contract providers of
31 comprehensive health care services who have assumed, through
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1 capitation or other means, more than 10 percent of the health
2 care risks of the provider-sponsored organization. However,
3 this section does not apply to any individual physician.
4 641.4616 Administrative penalty in lieu of suspension
5 or revocation.--If the department finds that one or more
6 grounds exist for the revocation or suspension of a
7 certificate issued under this part, the department may, in
8 lieu of revocation or suspension, impose a fine upon the
9 provider-sponsored organization. With respect to any
10 nonwillful violation, the fine may not exceed $2,500 per
11 violation. Such fines may not exceed an aggregate amount of
12 $25,000 for all nonwillful violations arising out of the same
13 action. With respect to any knowing and willful violation of a
14 lawful order or rule of the department or a provision of this
15 part, the department may impose upon the organization a fine
16 in an amount not to exceed $20,000 for each such violation.
17 Such fines may not exceed an aggregate amount of $250,000 for
18 all knowing and willful violations arising out of the same
19 action. The department shall adopt by rule by January 1, 1999,
20 penalty categories that specify varying ranges of monetary
21 fines for willful violations and for nonwillful violations.
22 641.4617 Acquisition, merger, or consolidation.--Each
23 acquisition of a provider-sponsored organization is subject to
24 s. 628.4615. However, in the case of a provider-sponsored
25 organization organized as a for-profit corporation, s. 628.451
26 governs with respect to any merger or consolidation, and, in
27 the case of a provider-sponsored organization organized as a
28 not-for-profit corporation, s. 628.471 governs with respect to
29 any merger or consolidation.
30 641.4618 Annual report.--
31
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1 (1) Each provider-sponsored organization shall,
2 annually within 3 months after the end of its fiscal year, or
3 within an extension of time granted by the department for good
4 cause, in a form prescribed by the department, file a report
5 with the department, verified by the oath of two officers of
6 the organization or, if not a corporation, of two persons who
7 are principal managing directors of the affairs of the
8 organization, properly notarized, showing its condition on the
9 last day of the immediately preceding reporting period. The
10 report must include:
11 (a) A financial statement of the organization filed on
12 a computer diskette using a format acceptable to the
13 department;
14 (b) A financial statement of the organization filed on
15 forms acceptable to the department;
16 (c) An audited financial statement of the
17 organization, including its balance sheet and a statement of
18 operations for the preceding year certified by an independent
19 certified public accountant, prepared in accordance with
20 statutory accounting principles;
21 (d) The number of provider-sponsored contracts issued
22 and outstanding and the number of provider-sponsored contracts
23 terminated;
24 (e) The number and amount of damage claims for medical
25 injury initiated against the provider-sponsored organization
26 and any of the providers engaged by it during the reporting
27 year, broken down into claims with and without formal legal
28 process, and the disposition, if any, of each such claim;
29 (f) An actuarial certification that:
30 1. The provider-sponsored organization is actuarially
31 sound, which certification shall consider the premiums,
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1 benefits, and expenses of, and any other funds available for
2 the payment of obligations of, the organization; and
3 2. Claims incurred but not reported and claims
4 reported but not fully paid have been adequately provided for;
5 and
6 (g) Any other information relating to the performance
7 of provider-sponsored organizations which is required by the
8 department.
9 (2) Each provider-sponsored organization shall file
10 quarterly, within 45 days after each of its quarterly
11 reporting periods, an unaudited financial statement of the
12 organization as described in paragraphs (1)(a) and (b). The
13 quarterly report shall be verified by the oath of two officers
14 of the organization, properly notarized.
15 (3) Any provider-sponsored organization that neglects
16 to file an annual report or quarterly report in the form and
17 within the time required by this section shall forfeit up to
18 $1,000 for each day for the first 10 days during which the
19 neglect continues and shall forfeit up to $2,000 for each day
20 after the first 10 days during which the neglect continues.
21 Upon notice by the department, the organization's authority to
22 enroll new subscribers or to do business in this state shall
23 cease while such default continues. The department shall
24 deposit all sums collected by it under this section to the
25 credit of the Insurance Commissioner's Regulatory Trust Fund.
26 The department may not collect more than $100,000 for each
27 report.
28 (4) Each authorized provider-sponsored organization
29 shall retain an independent certified public accountant,
30 hereinafter referred to as a "CPA," who agrees by written
31
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1 contract with the provider-sponsored organization to comply
2 with this part. The contract must state:
3 (a) The CPA shall provide to the provider-sponsored
4 organization audited financial statements consistent with this
5 part.
6 (b) Any determination by the CPA that the
7 provider-sponsored organization does not meet minimum surplus
8 requirements as set forth in rules governing
9 provider-sponsored organizations adopted by the United States
10 Department of Health and Human Services pursuant to s. 1856(a)
11 of the Balanced Budget Act of 1997 shall be stated by the CPA,
12 in writing, in the audited financial statement.
13 (c) The completed work papers and any written
14 communications between the CPA firm and the provider-sponsored
15 organization which relate to the audit of the
16 provider-sponsored organization shall be made available for
17 review on a visual-inspection-only basis by the department at
18 the offices of the provider-sponsored organization, at the
19 department, or at any other reasonable place mutually agreed
20 to between the department and the provider-sponsored
21 organization. The CPA must retain the work papers and written
22 communications for review for at least 6 years.
23 (5) To facilitate uniformity in financial statements
24 and to facilitate department analysis, the department may by
25 rule adopt the form for financial statements of a
26 provider-sponsored organization, including supplements, as
27 approved by the National Association of Insurance
28 Commissioners in 1995, and may adopt subsequent amendments
29 thereto if the methodology remains substantially consistent,
30 and may by rule require each provider-sponsored organization
31 to submit to the department all or part of the information
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1 contained in the annual statement in a computer-readable form
2 compatible with the electronic data processing system
3 specified by the department.
4 641.4619 Examination by the department.--
5 (1) The department shall examine the affairs,
6 transactions, accounts, business records, and assets of any
7 provider-sponsored organization as often as it deems necessary
8 for the protection of the Medicare beneficiaries of this
9 state, but not less frequently than once every 3 years. In
10 lieu of making its own financial examination, the department
11 may accept an independent certified public accountant's audit
12 report prepared on a statutory accounting basis consistent
13 with this part. However, except when the medical records are
14 requested and copies furnished pursuant to s. 455.667, medical
15 records of individuals and records of physicians providing
16 services under contract to the provider-sponsored organization
17 are not subject to audit, although they may be subject to
18 subpoena by court order upon a showing of good cause. For the
19 purpose of examinations, the department may administer oaths
20 to and examine the officers and agents of a provider-sponsored
21 organization concerning its business and affairs. The
22 examination of each provider-sponsored organization by the
23 department is subject to the same terms and conditions that
24 apply to insurers under chapter 624. Expenses of all
25 examinations may not exceed a maximum of $20,000 for any
26 1-year period. Any rehabilitation, liquidation, conservation,
27 or dissolution of a provider-sponsored organization shall be
28 conducted under the supervision of the department, which shall
29 have all powers with respect to the provider-sponsored
30 organization granted to the department under the laws
31
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1 governing the rehabilitation, liquidation, reorganization,
2 conservation, or dissolution of life insurance companies.
3 (2) The department may contract, at reasonable fees
4 for work performed, with qualified, impartial outside sources
5 to perform audits or examinations or portions thereof
6 pertaining to the qualification of an entity for issuance of a
7 certificate of authority or to determine continued compliance
8 with the requirements of this part. Any contracted assistance
9 shall be under the direct supervision of the department. The
10 results of any contracted assistance are subject to the review
11 of, and approval, disapproval, or modification by, the
12 department.
13 641.4620 Civil remedy.--In any civil action brought to
14 enforce the terms and conditions of a provider-sponsored
15 contract, the prevailing party may recover reasonable
16 attorney's fees and court costs. This section does not
17 authorize a civil action against the department, its
18 employees, or the director of the agency.
19 641.4621 Injunction.--In addition to the penalties and
20 other enforcement provisions of this part, the department is
21 vested with the power to seek both temporary and permanent
22 injunctive relief when:
23 (1) A provider-sponsored organization is being
24 operated by any person or entity without a subsisting
25 certificate of authority, unless a waiver has been granted by
26 the Secretary of the United States Department of Health and
27 Human Services pursuant to s. 1855(a)(2) of the Balanced
28 Budget Act of 1997.
29 (2) Any person, entity, or provider-sponsored
30 organization has engaged in any activity prohibited by this
31 part or any rule adopted under this part.
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1 (3) Any provider-sponsored organization, person, or
2 entity is renewing, issuing, or delivering a
3 provider-sponsored contract or contracts without a subsisting
4 certificate of authority, unless a waiver has been granted by
5 the Secretary of the United States Department of Health and
6 Human Services under s. 1855(a)(2) of the Balanced Budget Act
7 of 1997.
8
9 The department's authority to seek injunctive relief is not
10 conditioned on the department conducting any proceeding
11 pursuant to chapter 120.
12 641.4622 Payment of judgment by provider-sponsored
13 organization.--Except as otherwise ordered by the court or
14 mutually agreed-upon by the parties, each judgment or decree
15 entered in any of the courts of this state against any
16 provider-sponsored organization for the recovery of money
17 shall be fully satisfied within 60 days after the entry
18 thereof or, in the case of an appeal from such judgment or
19 decree, within 60 days after the affirmance of the judgment or
20 decree by the appellate court.
21 641.4623 Liquidation, rehabilitation, reorganization,
22 and conservation; exclusive methods of remedy.--A delinquency
23 proceeding under part I of chapter 631 or supervision by the
24 department under ss. 624.80-624.87 constitute the sole and
25 exclusive means of liquidating, reorganizing, rehabilitating,
26 or conserving a provider-sponsored organization.
27 641.4624 Fees.--Each provider-sponsored organization
28 shall pay to the department the following fees:
29 (1) For filing a copy of its application for a
30 certificate of authority or amendment thereto, a nonrefundable
31 fee in the amount of $1,000.
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1 (2) For filing each annual report, which must be filed
2 on computer diskettes, $150.
3 641.4625 Construction and relationship to other
4 laws.--
5 (1) Each provider-sponsored organization shall accept
6 the standard health claim form prescribed pursuant to s.
7 627.647.
8 (2) Except as provided in this part, the Florida
9 Insurance Code does not apply to provider-sponsored
10 organizations certificated under this part, and
11 provider-sponsored organizations certificated under this part
12 are not subject to part I or part II. Any person, entity, or
13 provider-sponsored organization operating without a subsisting
14 certificate of authority in violation of this part or rules
15 adopted under this part, or renewing, issuing, or delivering
16 provider-sponsored contracts without a subsisting certificate
17 of authority in violation of this part or rules adopted under
18 this part, in addition to being subject to the provisions of
19 this part is subject to the provisions of the Florida
20 Insurance Code as defined in s. 624.01, unless a waiver has
21 been granted by the Secretary of the United States Department
22 of Health and Human Services under s. 1855(a)(2) of the
23 Balanced Budget Act of 1997.
24 (3) The solicitation of subscribers by a
25 provider-sponsored organization or its representatives does
26 not violate any provisions of law relating to solicitation or
27 advertising by health professionals if the provider-sponsored
28 organization is operating pursuant to a subsisting certificate
29 of authority or operating pursuant to a waiver granted by the
30 Secretary of the United States Department of Health and Human
31
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1 Services under s. 1855(a)(2) of the Balanced Budget Act of
2 1997.
3 (4) The Division of Insurance Fraud of the department
4 is vested with all powers granted to it under the Florida
5 Insurance Code with respect to investigating any violation of
6 this part.
7 (5) Each provider-sponsored organization must comply
8 with s. 627.4301.
9 641.4626 Human immunodeficiency virus infection and
10 acquired immune deficiency syndrome for contract purposes.--
11 (1) PURPOSE.--The purpose of this section is to
12 prohibit unfair practices in a provider-sponsored contract
13 with respect to exposure to the human immunodeficiency virus
14 infection and related matters, and thereby to reduce the
15 possibility that a provider-sponsored organization subscriber
16 or applicant may suffer unfair discrimination when subscribing
17 to or applying for the contractual services of a
18 provider-sponsored organization.
19 (2) SCOPE.--This section applies to all
20 provider-sponsored contracts that are issued in this state or
21 that are issued outside this state but cover residents of this
22 state to the extent that the provisions of this section are
23 not inconsistent with the rules established by the Secretary
24 of the United States Department of Health and Human Services
25 for the Medicare Choice program. This section does not
26 prohibit a provider-sponsored organization from contesting a
27 contract or claim to the extent allowed by law.
28 (3) DEFINITIONS.--As used in this section, the term:
29 (a) "AIDS" means acquired immune deficiency syndrome.
30 (b) "ARC" means AIDS-related complex.
31
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1 (c) "HIV" means human immunodeficiency virus
2 identified as the causative agent of AIDS.
3 (4) USE OF MEDICAL TESTS.--
4 (a) With respect to the issuance of or the
5 underwriting of a provider-sponsored contract regarding
6 exposure to the HIV infection and sickness or medical
7 conditions derived from such infection, a provider-sponsored
8 organization may use only medical tests that are reliable
9 predictors of risk. A test that is recommended by the Centers
10 for Disease Control or by the federal Food and Drug
11 Administration is deemed to be reliable for the purposes of
12 this section. A test that is rejected or not recommended by
13 the Centers for Disease Control or the federal Food and Drug
14 Administration is not a reliable test for the purposes of this
15 section. If a specific test recommended by the Centers for
16 Disease Control or by the federal Food and Drug Administration
17 indicates the existence or potential existence of exposure to
18 the HIV infection or a sickness or medical condition related
19 to the HIV infection, before relying on a single test result
20 to deny or limit coverage or to rate the coverage the
21 provider-sponsored organization shall follow the applicable
22 test protocol recommended by the Centers for Disease Control
23 or by the federal Food and Drug Administration and shall use
24 any applicable followup tests or series of tests that are
25 recommended by the Centers for Disease Control or by the
26 federal Food and Drug Administration to confirm the
27 indication.
28 (b) Prior to testing, the provider-sponsored
29 organization must disclose its intent to test the person for
30 the HIV infection or for a specific sickness or medical
31 condition derived therefrom and must obtain the person's
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1 written informed consent to administer the test. Written
2 informed consent includes a fair explanation of the test,
3 including its purpose, potential uses, and limitations, and
4 the meaning of its results and the right to confidential
5 treatment of information. Use of a form approved by the
6 department raises a conclusive presumption of informed
7 consent.
8 (c) An applicant shall be notified of a positive test
9 result by a physician designated by the applicant or, in the
10 absence of such designation, by the Department of Health. Such
11 notification must include:
12 1. Face-to-face posttest counseling on the meaning of
13 the test results, the possible need for additional testing,
14 and the need to eliminate behavior that might spread the
15 disease to others.
16 2. The availability in the geographic area of any
17 appropriate health care services, including mental health
18 care, and appropriate social and support services.
19 3. The benefits of locating and counseling any
20 individual by whom the infected individual may have been
21 exposed to human immunodeficiency virus and any individual
22 whom the infected individual may have exposed to the virus.
23 4. The availability, if any, of the services of public
24 health authorities with respect to locating and counseling any
25 individual described in subparagraph 3.
26 (d) A medical test for exposure to the HIV infection
27 or for a sickness or medical condition derived from such
28 infection shall only be required of or given to a person if
29 the test is required or given to all subscribers or applicants
30 or if the decision to require the test is based on the
31 person's medical history.
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1 (e) A provider-sponsored organization may inquire
2 whether a person has been tested positive for exposure to the
3 HIV infection or diagnosed as having AIDS or ARC caused by the
4 HIV infection or other sickness or medical condition derived
5 from such infection. A provider-sponsored organization may not
6 inquire whether a person has been tested for or has received a
7 negative result from a specific test for exposure to the HIV
8 infection or for a sickness or medical condition derived from
9 such infection.
10 (f) A provider-sponsored organization shall maintain
11 strict confidentiality concerning any medical test results
12 with respect to an HIV infection or a specific sickness or
13 medical condition derived from such infection. Information
14 regarding specific test results may not be disclosed outside
15 the provider-sponsored organization, its employees, its
16 marketing representatives, or its insurance affiliates, except
17 to the person tested and to persons designated in writing by
18 the person tested. Specific test results may not be furnished
19 to any data bank of the insurance industry or
20 provider-sponsored organization if a review of the information
21 would identify the individual tested or the specific test
22 results.
23 (g) An insurer or insurance support organization may
24 not use a laboratory for processing HIV-related tests unless
25 the laboratory is certified by the United States Department of
26 Health and Human Services under the Clinical Laboratories
27 Improvement Act of 1967, permitting testing of specimens
28 obtained in interstate commerce, and unless the laboratory
29 subjects itself to ongoing proficiency testing by the College
30 of American Pathologists, the American Association of Bio
31 Analysts, or an equivalent program approved by the Centers for
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1 Disease Control of the United States Department of Health and
2 Human Services.
3 (5) RESTRICTIONS ON CONTRACT EXCLUSIONS AND
4 LIMITATIONS.--
5 (a) A provider-sponsored contract may not exclude
6 coverage of an individual because of a positive test result
7 for exposure to the HIV infection or a specific sickness or
8 medical condition derived from such infection, either as a
9 condition for or subsequent to the issuance of the contract.
10 However, this paragraph does not apply to a person who applies
11 for enrollment if individual underwriting is otherwise allowed
12 by law.
13 (b) A provider-sponsored contract may not exclude or
14 limit coverage for exposure to the HIV infection or a specific
15 sickness or medical condition derived from such infection,
16 except as provided in a preexisting condition clause.
17 641.4627 Language used in contracts and
18 advertisements; translations.--
19 (1)(a) Each contract or form used by a
20 provider-sponsored organization must be printed in English.
21 (b) If the negotiations by a provider-sponsored
22 organization with a member leading up to the effectuation of a
23 provider-sponsored contract are conducted in a language other
24 than English, the provider-sponsored organization shall supply
25 to the member a written translation of the contract, which
26 translation accurately reflects the substance of the contract
27 and is in the language used to negotiate the contract. The
28 written translation must be affixed to and shall become a part
29 of the contract or form.
30 (2) The text of each advertisement by a
31 provider-sponsored organization, if printed or broadcast in a
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1 language other than English, shall also be available in
2 English and shall be furnished to the department upon request.
3 As used in this subsection, the term "advertisement" means any
4 advertisement, circular, pamphlet, brochure, or other printed
5 material that discloses or disseminates advertising material
6 or information by a provider-sponsored organization to
7 prospective or existing subscribers and includes any radio or
8 television transmittal of an advertisement or information.
9 641.4628 Standards for marketing to persons eligible
10 for Medicare.--
11 (1) Each provider-sponsored organization that markets
12 its coverage to Medicare participants or persons eligible for
13 Medicare in this state, directly or through its agents, shall:
14 (a) Establish marketing procedures to assure that any
15 comparison of benefits between Medicare or any other
16 provider-sponsored organization that offers such coverage by
17 its agents will be fair and accurate.
18 (b) Establish marketing procedures to assure proper
19 notification to the Medicare participant of enrollment or
20 disenrollment from the provider-sponsored organization. Such
21 notification shall be made in a timely manner.
22 (c) Display prominently by type, stamp, or other
23 appropriate means, on the first page of the application and
24 contract, the following:
25 "Notice to buyer: When you enroll in this
26 provider-sponsored organization, you will be
27 disenrolled from Medicare. The buyer should be
28 aware that in order to receive payment or
29 coverage for services, such services must be
30 rendered by physicians, hospitals, and other
31 health care providers designated by the
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1 provider-sponsored organization. If the
2 services are rendered by a nonparticipating
3 physician, hospital, or other health care
4 provider, the purchaser may be liable for
5 payment for such services except in very
6 limited circumstances."
7 (d) Inquire and otherwise make every reasonable effort
8 to identify whether a prospective Medicare participant has
9 previously been enrolled in either the same provider-sponsored
10 organization as a Medicare participant or in another
11 provider-sponsored organization as a Medicare participant.
12 (2) In addition to the practices prohibited in s.
13 641.4642:
14 (a) A provider-sponsored organization or a person who
15 represents such provider-sponsored organization may not employ
16 any method of marketing which has the effect of or tends to
17 induce the purchase of health care plans through fraud,
18 deceit, force, fright, threat whether explicit or implied,
19 intimidation, harassment, or undue pressure to purchase or
20 recommend the purchase of a provider-sponsored contract.
21 (b) A participating provider, employee, or agent of
22 such participating provider may not be an agent for or conduct
23 any sales activities for a provider-sponsored organization
24 with whom the provider, employee, or agent has a provider
25 contract.
26 641.4629 Provider-sponsored contracts.--
27 (1) Any entity issued a certificate and otherwise in
28 compliance with this part may enter into contracts in this
29 state to provide Medicare Choice benefits to subscribers in
30 exchange for a premium payment. Each subscriber shall be given
31 a copy of the applicable provider-sponsored contract,
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1 certificate, or member handbook. Whichever document is
2 provided to a subscriber must contain all of the provisions
3 and disclosures required by this section.
4 (2) Each provider-sponsored contract, certificate, or
5 member handbook must clearly state all of the services to
6 which a subscriber is entitled under the Medicare Choice
7 contract and must include a clear and understandable statement
8 of any limitations on the services or kinds of services to be
9 provided, including any copayment feature or schedule of
10 benefits required by the contract. The contract, certificate,
11 or member handbook must also state where and in what manner
12 the comprehensive health care services may be obtained.
13 (3) Each subscriber shall receive a clear and
14 understandable description of the method of the
15 provider-sponsored organization for resolving subscriber
16 grievances, and the method must be set forth in the contract,
17 certificate, or member handbook. The organization shall also
18 furnish, at the time of initial enrollment and when necessary
19 due to substantial changes in the grievance process, a
20 separate and additional communication notifying each Medicare
21 Choice subscriber of his or her rights and responsibilities
22 under the grievance process.
23 (4) A provider-sponsored organization may coordinate
24 benefits on the same basis as an insurer under s. 627.4235.
25 (5) A provider-sponsored organization that provides
26 medical benefits or payments to a subscriber who suffers
27 injury, disease, or illness by virtue of the negligent act or
28 omission of a third party is entitled to reimbursement from
29 the subscriber in accordance with s. 768.76(4).
30 (6) A person other than the applicant may not alter
31 any written application for any provider-sponsored contract
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1 without the applicant's written consent, except that
2 insertions may be made by the provider-sponsored organization,
3 for administrative purposes only, in such manner as to
4 indicate clearly that such insertions are not to be ascribed
5 to the applicant.
6 (7) A contract may not contain any waiver of rights or
7 benefits provided to or available to subscribers under the
8 provisions of any law or rule applicable to provider-sponsored
9 organizations.
10 (8) Each Medicare Choice contract, certificate, or
11 member handbook must state that emergency services and care
12 shall be provided without prior notification to and approval
13 of the organization to subscribers in emergency situations
14 that do not permit treatment through the provider-sponsored
15 organization's providers. Not less than 75 percent of the
16 reasonable charges for covered services and supplies shall be
17 paid by the organization, up to the subscriber contract
18 benefit limits. Payment also may be subject to additional
19 applicable copayment provisions, not to exceed $100 per claim,
20 if not inconsistent with federal rules established by the
21 Secretary of the United States Department of Health and Human
22 Services governing Medicare Choice benefits. The Medicare
23 Choice contract, certificate, or member handbook must define
24 the terms "emergency services and care" and "emergency medical
25 condition" as specified in s. 641.4603(6) and (7), must
26 describe the procedures by which the provider-sponsored
27 organization determines whether the services qualify for
28 reimbursement as emergency services and care, and must contain
29 specific examples of what constitutes an emergency. In
30 providing for emergency services and care as a covered
31
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1 service, a provider-sponsored organization shall be governed
2 by s. 641.513.
3 (9) In addition to the requirements of this section,
4 and if not inconsistent with the rules established by the
5 Secretary of the United States Department of Health and Human
6 Services for the Medicare Choice program, with respect to a
7 person who is entitled to have payments for health care costs
8 made under Medicare, Title XVIII of the Social Security Act,
9 parts A or B:
10 (a) The provider-sponsored organization shall mail or
11 deliver notification to the Medicare beneficiary of the date
12 of enrollment in the provider-sponsored organization within 10
13 days after receiving notification of enrollment approval from
14 the Health Care Financing Administration. When a Medicare
15 beneficiary who is a subscriber of the provider-sponsored
16 organization requests disenrollment from the organization, the
17 organization shall mail or deliver to the beneficiary notice
18 of the effective date of the disenrollment within 10 days
19 after receipt of the written disenrollment request. The
20 provider-sponsored organization shall forward the
21 disenrollment request to the Health Care Financing
22 Administration in a timely manner so as to effectuate the next
23 available disenrollment date, as prescribed by the federal
24 agency.
25 (b) The provider-sponsored contract, certificate, or
26 member handbook shall be delivered to the subscriber no later
27 than the earlier of 10 working days after the
28 provider-sponsored organization and the Health Care Financing
29 Administration approve the subscriber's enrollment application
30 or the effective date of coverage of the subscriber under the
31 provider-sponsored contract. However, if notice from the
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1 Health Care Financing Administration of its approval of the
2 subscriber's enrollment application is received by the
3 provider-sponsored organization after the effective coverage
4 date prescribed by the Health Care Financing Administration,
5 the provider-sponsored organization shall deliver the
6 contract, certificate, or member handbook to the subscriber
7 within 10 days after receiving such notice. When a Medicare
8 recipient is enrolled in a provider-sponsored organization
9 program, the contract, certificate, or member handbook shall
10 be accompanied by an identification sticker with instruction
11 to the Medicare beneficiary to place the sticker on the
12 Medicare identification card.
13 (10) Each provider-sponsored organization that
14 provides for inpatient and outpatient services by allopathic
15 hospitals shall provide, as an option of the subscriber,
16 similar inpatient and outpatient services by hospitals
17 accredited by the American Osteopathic Association when such
18 services are available in the same service area of the
19 provider-sponsored organization and the osteopathic hospital
20 agrees to provide the services specified in this part. As a
21 condition precedent to providing osteopathic inpatient and
22 outpatient services through an osteopathic hospital that has
23 not entered into a written contract with the
24 provider-sponsored organization, the provider-sponsored
25 organization may require the subscriber who receives
26 osteopathic services to release the provider-sponsored
27 organization from any liability arising from any act of
28 omission or commission constituting malpractice in the
29 delivery of osteopathic care from that hospital. The
30 osteopathic hospital that provides the inpatient and
31 outpatient services for the provider-sponsored organization
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1 shall charge rates that do not exceed the osteopathic
2 hospital's usual and customary rates, less the average
3 discount provided by allopathic hospitals providing the
4 services in the same service area of the provider-sponsored
5 organization.
6 (11) To the extent that this section is not
7 inconsistent, pursuant to s. 1856(b)(3) of the Balanced Budget
8 Act of 1997, with the rules established by the Secretary of
9 the United States Department of Health and Human Services for
10 the Medicare Choice program:
11 (a) A provider-sponsored contract that provides
12 coverage, benefits, or services for breast cancer treatment
13 may not limit inpatient hospital coverage for mastectomies to
14 any period that is less than that determined by the treating
15 physician under contract with the provider-sponsored
16 organization to be medically necessary in accordance with
17 prevailing medical standards and after consultation with the
18 covered patient. Such contract must also provide coverage for
19 outpatient postsurgical followup care in keeping with
20 prevailing medical standards by a licensed health care
21 professional under contract with the provider-sponsored
22 organization qualified to provide postsurgical mastectomy
23 care. The treating physician under contract with the
24 provider-sponsored organization, after consultation with the
25 covered patient, may choose that the outpatient care be
26 provided at the most medically appropriate setting, which may
27 include the hospital, treating physician's office, outpatient
28 center, or home of the covered patient.
29 (b) A provider-sponsored organization subject to this
30 subsection may not:
31
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1 1. Deny to a covered person eligibility, or continued
2 eligibility, to enroll or to renew coverage under the terms of
3 the contract for the purpose of avoiding the requirements of
4 this subsection;
5 2. Provide monetary payments or rebates to a covered
6 patient to accept less than the minimum protections available
7 under this subsection;
8 3. Penalize or otherwise reduce or limit the
9 reimbursement of an attending provider solely because the
10 attending provider provided care to a covered patient under
11 this subsection;
12 4. Provide incentives, monetary or otherwise, to an
13 attending provider solely to induce the provider to provide
14 care to a covered patient in a manner inconsistent with this
15 subsection; or
16 5. Subject to the other provisions of this subsection,
17 restrict benefits for any portion of a period within a
18 hospital length of stay or for outpatient care as required by
19 this subsection in a manner that is less favorable than the
20 benefits provided for any preceding portion of such stay or
21 for preceding outpatient care.
22 (c)1. This subsection does not require a covered
23 patient to have the mastectomy in the hospital or stay in the
24 hospital for a fixed period of time following the mastectomy.
25 2. This subsection does not prevent a contract from
26 imposing deductibles, coinsurance, or other cost-sharing in
27 relation to benefits pursuant to this subsection, except that
28 such cost-sharing may not exceed cost-sharing with other
29 benefits.
30 (d) Except as provided in paragraph (b), this
31 subsection does not affect any agreement between a
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1 provider-sponsored organization and a hospital or other health
2 care provider with respect to reimbursement for health care
3 services provided, rate negotiations with providers, or
4 capitation of providers, and does not prohibit appropriate
5 utilization review or case management by the
6 provider-sponsored organization.
7 (e) As used in this subsection, the term "mastectomy"
8 means the removal of all or part of the breast for medically
9 necessary reasons as determined by a licensed physician.
10 (12) To the extent that this section is not
11 inconsistent, pursuant to s. 1856(b)(3) of the Balanced Budget
12 Act of 1997, with the rules established by the Secretary of
13 the United States Department of Health and Human Services for
14 the Medicare Choice program, a provider-sponsored contract
15 that provides coverage for mastectomies must also provide
16 coverage for prosthetic devices and breast reconstructive
17 surgery incident to the mastectomy. As used in this
18 subsection, the term "breast reconstructive surgery" means
19 surgery to reestablish symmetry between the two breasts. Such
20 surgery must be in a manner chosen by the treating physician
21 under contract with the provider-sponsored organization,
22 consistent with prevailing medical standards, and in
23 consultation with the patient. The provider-sponsored
24 organization may charge an appropriate additional premium for
25 the coverage required by this subsection. The coverage for
26 prosthetic devices and breast reconstructive surgery is
27 subject to any deductible and coinsurance conditions.
28 641.4630 Provider-sponsored organization; disclosure
29 of terms and conditions of plan.--Each provider-sponsored
30 organization shall provide prospective enrollees with written
31 information about the terms and conditions of the plan so that
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1 the prospective enrollees can make informed decisions about
2 accepting a managed-care system of health care delivery.
3 However, information about where, in what manner, and from
4 whom the comprehensive health care services or specific health
5 care services can be obtained need be disclosed only upon
6 request by the prospective enrollee. All marketing materials
7 distributed by the provider-sponsored organization must
8 contain a notice in boldfaced type which states that the
9 information required under this section is available to the
10 prospective enrollee upon request.
11 641.4631 Coverage for mammograms.--
12 (1) To the extent that this section is not
13 inconsistent, pursuant to s.1856(b)(3) of the Balanced Budget
14 Act of 1997, with the rules established by the Secretary of
15 the United States Department of Health and Human Services for
16 the Medicare Choice program, each provider-sponsored contract
17 issued or renewed on or after October 1, 1998, must provide
18 coverage for at least the following:
19 (a) A baseline mammogram for any woman who is 35 years
20 of age or older, but younger than 40 years of age.
21 (b) A mammogram every 2 years for any woman who is 40
22 years of age or older, but younger than 50 years of age, or
23 more frequently based on the patient's physician's
24 recommendations.
25 (c) A mammogram every year for any woman who is 50
26 years of age or older.
27 (d) One or more mammograms a year, based upon a
28 physician's recommendation for any woman who is at risk for
29 breast cancer because of a personal or family history of
30 breast cancer; because of having a history of biopsy-proven
31 benign breast disease; because of having a mother, sister, or
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1 daughter who has had breast cancer; or because a woman has not
2 given birth before the age of 30.
3 (2) The coverage required by this section is subject
4 to the deductible and copayment provisions applicable to
5 outpatient visits, and is also subject to all other terms and
6 conditions applicable to other benefits. A provider-sponsored
7 organization shall make available to the subscriber as part of
8 the application, for an appropriate additional premium, the
9 coverage required in this section without such coverage being
10 subject to any deductible or copayment provisions in the
11 contract.
12 641.4632 Requirements with respect to breast cancer
13 and routine followup care.--To the extent that this section is
14 not inconsistent, pursuant to s. 1856(b)(3) of the Balanced
15 Budget Act of 1997, with the rules established by the
16 Secretary of the United States Department of Health and Human
17 Services for the Medicare Choice program, routine followup
18 care to determine whether a breast cancer has recurred in a
19 person who has been previously determined to be free of breast
20 cancer does not constitute medical advice, diagnosis, care, or
21 treatment for purposes of determining preexisting conditions
22 unless evidence of breast cancer is found during or as a
23 result of the followup care.
24 641.4633 Provider contracts.--
25 (1) Whenever a contract exists between a
26 provider-sponsored organization and a provider, and the
27 organization fails to meet its obligations to pay fees for
28 services already rendered to a subscriber, the
29 provider-sponsored organization is liable for such fee or fees
30 rather than the subscriber, and the contract must so state.
31
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1 (2) A subscriber of a provider-sponsored organization
2 is not liable to any provider of health care services for any
3 services covered by the provider-sponsored organization.
4 (3) A provider of services or any representative of
5 such provider may not collect or attempt to collect from a
6 subscriber any money for services covered by the
7 provider-sponsored organization and a provider or
8 representative of such provider may not maintain any action at
9 law against a subscriber to collect money owed to such
10 provider by the provider-sponsored organization.
11 (4) Each contract between a provider-sponsored
12 organization and a provider of health care services must be in
13 writing and contain a provision that the subscriber is not
14 liable to the provider for any services covered by the
15 subscriber's contract with the provider-sponsored
16 organization.
17 (5) This section does not apply to the amount of any
18 deductible or copayment which is not covered by the contract
19 of the provider-sponsored organization.
20 (6)(a) Each provider contract must specify that:
21 1. The provider shall provide 60 days' advance written
22 notice to the provider-sponsored organization and the
23 department before canceling the contract with the
24 provider-sponsored organization for any reason; and
25 2. Nonpayment for goods or services rendered by the
26 provider to the provider-sponsored organization is not a valid
27 reason for avoiding the 60-day advance notice of cancellation.
28 (b) Each contract must specify that the
29 provider-sponsored organization will provide 60 days' advance
30 written notice to the provider and the department before
31 canceling, without cause, the contract with the provider,
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1 except in a case in which a patient's health is subject to
2 imminent danger or a physician's ability to practice medicine
3 is effectively impaired by an action by the Board of Medicine
4 or other governmental agency.
5 (7) Upon receipt by the provider-sponsored
6 organization of a 60-day cancellation notice, the
7 provider-sponsored organization may, if requested by the
8 provider, terminate the contract in less than 60 days if the
9 provider-sponsored organization is not financially impaired or
10 insolvent.
11 (8) A contract between a provider-sponsored
12 organization and a provider of health care services may not
13 contain any provision that restricts the provider's ability to
14 communicate information to the provider's patient regarding
15 medical care or treatment options for the patient when the
16 provider deems knowledge of such information by the patient to
17 be in the best interest of the health of the patient.
18 641.4634 Certain words prohibited in name of
19 organization.--
20 (1) An entity certificated as a provider-sponsored
21 organization, other than a licensed insurer insofar as its
22 name is concerned, may not use in its name, contracts, or
23 literature any of the words "insurance," "casualty," "surety,"
24 or "mutual," or any other words descriptive of the insurance,
25 casualty, or surety business or deceptively similar to the
26 name or description of any insurance or surety corporation
27 doing business in the state.
28 (2) A person, entity, or health care plan that is not
29 certificated under this part may not use in its name, logo,
30 contracts, or literature the phrase "provider-sponsored
31 organization" or the initials "PSO"; imply, directly or
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1 indirectly, that it is a provider-sponsored organization; or
2 hold itself out to be a provider-sponsored organization.
3 641.4635 Assets, liabilities, and
4 investments.--Assets, liabilities, and investments for
5 provider-sponsored organizations that offer the Medicare
6 Choice plan must be consistent with the federal rules on
7 solvency standards established by the Secretary of the United
8 States Department of Health and Human Services pursuant to s.
9 1856(a) of the Balanced Budget Act of 1997.
10 641.4636 Adoption of rules; penalty for
11 violation.--The department shall adopt rules necessary to
12 carry out the provisions of this part which must be consistent
13 with the federal rules for the Medicare Choice plan
14 established by the Secretary of the United States Department
15 of Health and Human Services pursuant to the Balanced Budget
16 Act of 1997. An entity that violates a rule adopted under this
17 section is subject to s. 641.4613.
18 641.4637 Dividends.--
19 (1) A provider-sponsored organization may not pay any
20 dividend or distribute cash or other property to stockholders
21 except out of that part of its available and accumulated
22 surplus funds which is derived from realized net operating
23 profits on its business and net realized capital gains.
24 Dividend payments or distributions to stockholders may not
25 exceed 10 percent of such surplus in any one year unless
26 otherwise approved by the department. In addition to such
27 limited payments, a provider-sponsored organization may make
28 dividend payments or distributions out of the organization's
29 entire net operating profits and realized net capital gains
30 derived during the immediately preceding calendar or fiscal
31 year, as applicable.
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1 (2) The department may not approve a dividend or
2 distribution in excess of the maximum amount allowed in
3 subsection (1) unless it determines that the distribution or
4 dividend does not jeopardize the financial condition of the
5 provider-sponsored organization.
6 (3) Any director of a provider-sponsored organization
7 who knowingly votes for or concurs in the declaration or
8 payment of a dividend to stockholders when such declaration or
9 payment violates this section commits a misdemeanor of the
10 second degree, punishable as provided in s. 775.082 or s.
11 775.083, and is jointly and severally liable, together with
12 other such directors likewise voting for or concurring, for
13 any loss thereby sustained by creditors of the
14 provider-sponsored organization to the extent of such
15 dividend.
16 (4) Any stockholder who receives such an illegal
17 dividend is liable in the amount thereof to the
18 provider-sponsored organization.
19 (5) The department may revoke or suspend the
20 certificate of authority of a provider-sponsored organization
21 that has declared or paid an illegal dividend.
22 641.4638 Prohibited activities; penalties.--
23 (1) Any person or entity that knowingly renews,
24 issues, or delivers any provider-sponsored contract without
25 first obtaining and thereafter maintaining a certificate of
26 authority, unless a waiver has been granted by the Secretary
27 of the United States Department of Health and Human Services
28 pursuant to s. 1855(a)(2) of the Balanced Budget Act of 1997,
29 commits a felony of the third degree, punishable as provided
30 in s. 775.082, s. 775.083, or s. 775.084.
31
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1 (2) Except as provided in subsection (1), any person,
2 entity, or provider-sponsored organization that knowingly
3 violates this part commits a misdemeanor of the first degree,
4 punishable as provided in s. 775.082 or s. 775.083.
5 (3) Any agent or representative, solicitor, examining
6 physician, applicant, or other person who knowingly makes any
7 false and fraudulent statement or representation in, or with
8 reference to, any application or negotiation for coverage by a
9 provider-sponsored organization, in addition to any other
10 penalty provided by law, commits a misdemeanor of the first
11 degree, punishable as provided in s. 775.082 or s. 775.083.
12 (4) Any agent, representative, solicitor, collector,
13 or other person who, while acting on behalf of a
14 provider-sponsored organization, receives or collects its
15 funds or premium payments and fails to satisfactorily account
16 for or turn over, when required, all such funds or payments,
17 in addition to the other penalties provided for by law,
18 commits a misdemeanor of the second degree, punishable as
19 provided in s. 775.082 or s. 775.083.
20 (5) Any person who, without authority granted by a
21 provider-sponsored organization, collects or secures cash
22 advances, premium payments, or other funds owing to the
23 provider-sponsored organization or otherwise conducts the
24 business of a provider-sponsored organization without its
25 authority, in addition to the other penalties provided for by
26 law, commits a misdemeanor of the second degree, punishable as
27 provided in s. 775.082 or s. 775.083.
28 641.4639 Order to discontinue certain
29 advertising.--If, in the opinion of the department, any
30 advertisement by a provider-sponsored organization violates
31 this part, the department may enter an immediate order
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1 requiring that the use of the advertisement be discontinued.
2 If requested by the provider-sponsored organization, the
3 department shall conduct a hearing within 10 days after the
4 entry of such order. If, after the hearing or by agreement
5 with the provider-sponsored organization, a final
6 determination is made that the advertising did in fact violate
7 this part, the department may, in lieu of revoking the
8 certificate of authority, require the organization to publish
9 a corrective advertisement, impose an administrative penalty
10 of up to $10,000, and, in the case of an initial solicitation,
11 require that the provider-sponsored organization, prior to
12 accepting any application received in response to the
13 advertisement, provide an acceptable clarification of the
14 advertisement to each individual applicant.
15 641.4640 Agent licensing and appointment required;
16 exceptions.--
17 (1) With respect to a provider-sponsored contract, a
18 person may not, unless licensed and appointed as a health
19 insurance agent in accordance with the applicable provisions
20 of the Florida Insurance Code:
21 (a) Solicit contracts or procure applications; or
22 (b) Engage or hold himself or herself out as engaging
23 in the business of analyzing or abstracting provider-sponsored
24 contracts or of counseling, advising, or giving opinions to
25 persons relative to such contracts other than as a consulting
26 actuary advising a provider-sponsored organization or as a
27 salaried and bona fide full-time employee so counseling and
28 advising his or her employer relative to coverage for the
29 employer and his or her employees.
30 (2) All qualifications, disciplinary provisions,
31 licensing and appointment procedures, fees, and related
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1 matters contained in the Florida Insurance Code which apply to
2 the licensing and appointment of health insurance agents by
3 insurers apply to provider-sponsored organizations and to
4 persons licensed or appointed by the provider-sponsored
5 organization as its agents.
6 (3) An examination, license, or appointment is not
7 required of any regular salaried officer or employee of a
8 provider-sponsored organization who devotes substantially all
9 of his or her services to activities other than the
10 solicitation of provider-sponsored contracts from the public
11 and who does not receive a commission or other compensation
12 that is directly dependent upon the solicitation of such
13 contracts.
14 (4) Each agent and provider-sponsored organization
15 must comply with and be subject to the applicable provisions
16 of ss. 409.912(18) and 641.4640, and each company or entity
17 that appoints agents must comply with s. 626.451 when
18 marketing for any provider-sponsored organization licensed
19 under this part.
20 641.4641 Unfair methods of competition and unfair or
21 deceptive acts or practices prohibited.--A person, entity, or
22 provider-sponsored organization may not engage in this state
23 in any trade practice that is defined in this part as, or
24 determined pursuant to s. 641.4643 to be, an unfair method of
25 competition or an unfair or deceptive act or practice that
26 involves the business of a provider-sponsored organization.
27 641.4642 Unfair methods of competition and unfair or
28 deceptive acts or practices defined.--The following acts are
29 unfair methods of competition and unfair or deceptive acts or
30 practices:
31
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1 (1) MISREPRESENTATION AND FALSE ADVERTISING OF
2 PROVIDER-SPONSORED CONTRACTS.--Knowingly making, issuing, or
3 circulating, or causing to be made, issued, or circulated, any
4 estimate, illustration, circular, statement, sales
5 presentation, omission, or comparison that:
6 (a) Misrepresents the benefits, advantages,
7 conditions, or terms of any provider-sponsored contract.
8 (b) Is misleading or is a misrepresentation as to the
9 financial condition of any person.
10 (c) Uses any name or title of any contract which
11 misrepresents the true nature of the contract.
12 (d) Is a misrepresentation for the purpose of
13 inducing, or tending to induce, the lapse, forfeiture,
14 exchange, conversion, or surrender of any provider-sponsored
15 contract under the Medicare Choice program.
16 (e) Misrepresents the benefits, nature,
17 characteristics, uses, standard, quantity, quality, cost,
18 rate, scope, source, or geographic origin or location of any
19 goods or services available from or provided by, directly or
20 indirectly, any provider-sponsored organization.
21 (f) Misrepresents the affiliation, connection, or
22 association of any goods, services, or business establishment.
23 (g) Advertises goods or services with intent not to
24 sell them as advertised.
25 (h) Disparages the goods, services, or business of
26 another person by any false or misleading representation.
27 (i) Misrepresents the sponsorship, endorsement,
28 approval, or certification of goods or services.
29 (j) Uses an advertising format that, by virtue of the
30 design, location, or size of printed matter, is deceptive or
31
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1 misleading or that would be deceptive or misleading to any
2 reasonable person.
3 (k) Offers to provide a service that the
4 provider-sponsored organization is unable to provide.
5 (l) Misrepresents the availability of a service
6 provided by the provider-sponsored organization, either
7 directly or indirectly, including the availability of the
8 service as to location.
9 (2) FALSE INFORMATION AND ADVERTISING
10 GENERALLY.--Knowingly making, publishing, disseminating,
11 circulating, or placing before the public, or causing,
12 directly or indirectly, to be made, published, disseminated,
13 circulated, or placed before the public:
14 (a) In a newspaper, magazine, or other publication;
15 (b) In the form of a notice, circular, pamphlet,
16 letter, or poster;
17 (c) Over any radio or television station; or
18 (d) In any other way,
19
20 an advertisement, announcement, or statement that contains any
21 assertion, representation, or statement with respect to the
22 business of the provider-sponsored organization which is
23 untrue, deceptive, or misleading.
24 (3) DEFAMATION.--Knowingly making, publishing,
25 disseminating, or circulating, directly or indirectly, or
26 aiding, abetting, or encouraging the making, publishing,
27 disseminating, or circulating of, any oral or written
28 statement, or any pamphlet, circular, article, or literature,
29 that is false or maliciously critical of any person and that
30 is calculated to injure such person.
31 (4) FALSE STATEMENTS AND ENTRIES.--
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1 (a) Knowingly:
2 1. Filing with any supervisory or other public
3 official;
4 2. Making, publishing, disseminating, or circulating;
5 3. Delivering to any person;
6 4. Placing before the public; or
7 5. Causing, directly or indirectly, to be made,
8 published, disseminated, circulated, or delivered to any
9 person, or place before the public,
10
11 any material false statement.
12 (b) Knowingly making any false entry of a material
13 fact in any book, report, or statement of any person.
14 (5) UNFAIR CLAIM-SETTLEMENT PRACTICES.--
15 (a) Attempting to settle claims on the basis of an
16 application or any other material document that was altered
17 without notice to, or knowledge or consent of, the subscriber
18 or group of subscribers to a provider-sponsored organization.
19 (b) Making a material misrepresentation to the
20 subscriber for the purpose and with the intent of effecting
21 settlement of claims, loss, or damage under a
22 provider-sponsored contract on less favorable terms than those
23 provided in, and contemplated by, the contract.
24 (c) Committing or performing with such frequency as to
25 indicate a general business practice any of the following:
26 1. Failing to adopt and implement standards for the
27 proper investigation of claims.
28 2. Misrepresenting pertinent facts or contract
29 provisions relating to coverage at issue.
30 3. Failing to acknowledge and act promptly upon
31 communications with respect to claims.
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1 4. Denying of claims without conducting reasonable
2 investigations based upon available information.
3 5. Failing to affirm or deny coverage of claims upon
4 written request of the subscriber within a reasonable time,
5 which may not exceed 30 days after a claim or proof-of-loss
6 statements have been completed and documents pertinent to the
7 claim have been requested in a timely manner and received by
8 the provider-sponsored organization.
9 6. Failing to promptly provide a reasonable
10 explanation in writing to the subscriber of the basis in the
11 provider-sponsored contract which relates to the facts or
12 applicable law for denying a claim or offering a compromise
13 settlement.
14 7. Failing to provide, upon written request of a
15 subscriber, an itemized statement verifying that services and
16 supplies were furnished, if such statement is necessary for
17 submitting other insurance claims covered by individual
18 specified disease or limited benefit policies. However the
19 organization may charge a reasonable fee to cover the cost of
20 preparing such statement.
21 8. Failing to provide any subscriber with services,
22 care, or treatment contracted-for pursuant to any
23 provider-sponsored contract without a reasonable basis for
24 believing that a legitimate defense exists for not providing
25 such services, care, or treatment. To the extent that a
26 national disaster, war, riot, civil insurrection, epidemic, or
27 any other emergency or similar event not within the control of
28 the provider-sponsored organization results in the inability
29 of the facilities, personnel, or financial resources of the
30 provider-sponsored organization to provide or arrange for
31 provision of a health service in accordance with requirements
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1 of this part, the provider-sponsored organization is required
2 only to make a good-faith effort to provide or arrange for
3 provision of the service, taking into account the impact of
4 the event. For the purposes of this paragraph, an event is not
5 within the control of the provider-sponsored organization if
6 the provider-sponsored organization cannot exercise influence
7 or dominion over its occurrence.
8 (6) FAILURE TO MAINTAIN COMPLAINT-HANDLING
9 PROCEDURES.--Failure of any person to maintain a complete
10 record of all the complaints received since the date of the
11 most recent examination of the provider-sponsored organization
12 by the department. For the purposes of this subsection, the
13 term "complaint" means any written communication primarily
14 expressing a grievance and requesting a remedy to the
15 grievance.
16 (7) OPERATING WITHOUT A SUBSISTING CERTIFICATE OF
17 AUTHORITY.--Operating a provider-sponsored organization by any
18 person or entity without a subsisting certificate of authority
19 or renewal, issuance, or delivery of any provider-sponsored
20 contract by a provider-sponsored organization, person, or
21 entity without a subsisting certificate of authority, unless a
22 waiver has been granted by the Secretary of the United States
23 Department of Health and Human Services under s. 1855(a)(2) of
24 the Balanced Budget Act of 1997.
25 (8) MISREPRESENTATION IN PROVIDER-SPONSORED
26 ORGANIZATION APPLICATIONS.--Knowingly making false or
27 fraudulent statements or representations on, or relative to,
28 an application for a provider-sponsored contract for the
29 purpose of obtaining a fee, commission, money, or other
30 benefits from any agent, representative, or broker of a
31 provider-sponsored organization or any individual.
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1 (9) TWISTING.--Knowingly making any misleading
2 representations or incomplete or fraudulent comparisons of any
3 provider-sponsored contracts or provider-sponsored
4 organizations or of any insurance policies or insurers for the
5 purpose of inducing, or intending to induce, any person to
6 lapse, forfeit, surrender, terminate, retain, pledge, assign,
7 borrow on, or convert any insurance policy or
8 provider-sponsored contract or to take out a
9 provider-sponsored contract or policy of insurance in another
10 provider-sponsored organization or insurer.
11 (10) ILLEGAL DEALINGS IN PREMIUMS; EXCESS OR REDUCED
12 CHARGES FOR PROVIDER-SPONSORED COVERAGE.--
13 (a) Knowingly collecting any sum as a premium or
14 charge for provider-sponsored coverage that is not then
15 provided or is not in due course to be provided, subject to
16 acceptance of the risk by the provider-sponsored organization,
17 by a provider-sponsored contract issued by a
18 provider-sponsored organization as permitted by this part.
19 (b) Knowingly collecting as a premium or charge for
20 provider-sponsored coverage any sum in excess of or less than
21 the premium or charge applicable to provider-sponsored
22 coverage.
23 (11) FALSE CLAIMS; OBTAINING OR RETAINING MONEY
24 DISHONESTLY.--Knowingly presenting or causing to be presented
25 to any provider-sponsored organization, by any agent or
26 representative, physician, claimant, or other person, a false
27 claim for payment.
28 (12) PROHIBITED DISCRIMINATORY PRACTICES.--Refusing to
29 provide services or care to a subscriber solely because
30 medical services may be or have been sought for injuries
31 resulting from an assault, battery, sexual assault, sexual
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1 battery, or any other offense by a family or household member,
2 as defined in s. 741.28(2), or by another who is or was
3 residing in the same dwelling unit.
4 (13) MISREPRESENTATION IN PROVIDER-SPONSORED
5 ORGANIZATION; AVAILABILITY OF PROVIDERS.--Knowingly misleading
6 a potential enrollee as to the availability of providers.
7 641.4643 General powers and duties of the
8 department.--In addition to the powers and duties set forth in
9 s. 624.307, the department may examine and investigate the
10 affairs of every person, entity, or provider-sponsored
11 organization in order to determine whether the person, entity,
12 or provider-sponsored organization is operating in accordance
13 with this part or has been or is engaged in any unfair method
14 of competition or in any unfair or deceptive act or practice
15 prohibited by s. 641.4641.
16 641.4644 Defined unfair practices; hearings,
17 witnesses, appearances, production of books, and service of
18 process.--
19 (1) Whenever the department has reason to believe that
20 any person, entity, or provider-sponsored organization has
21 engaged, or is engaging, in this state in any unfair method of
22 competition or any unfair or deceptive act or practice as
23 defined in s. 461.4642 or is operating a provider-sponsored
24 organization without a certificate of authority as required by
25 this part, unless a waiver has been granted by the Secretary
26 of the United States Department of Health and Human Services
27 under s. 1855(a)(2) of the Balanced Budget Act of 1997, and
28 that a proceeding by the department with respect to any such
29 activity would be in the interest of the public, the
30 department shall conduct or cause to have conducted a hearing
31 in accordance with chapter 120.
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1 (2) The department, a duly empowered hearing officer,
2 or an administrative law judge shall, during the conduct of
3 such hearing, have those powers enumerated in s. 120.569.
4 However, the penalty for failing to comply with a subpoena or
5 with an order directing discovery is limited to a fine not to
6 exceed $1,000 per violation.
7 (3) Statements of charges, notices, and orders under
8 this part may be served by anyone duly authorized by the
9 department, either in the manner provided by law for service
10 of process in civil actions or by certifying and mailing a
11 copy thereof to the person, entity, or provider-sponsored
12 organization affected by the statement, notice, order, or
13 other process at her or his or its residence or principal
14 office or place of business. The verified return by the person
15 so serving such statement, notice, order, or other process,
16 setting forth the manner of the service, is proof of service,
17 and the return postcard receipt for such statement, notice,
18 order, or other process, certified and mailed as required, is
19 proof of service.
20 641.4645 Cease and desist and penalty orders.--After
21 the hearing provided in s. 641.4644, the department shall
22 enter a final order in accordance with s. 120.569. If it is
23 determined that the person, entity, or provider-sponsored
24 organization charged has engaged in an unfair or deceptive act
25 or practice or the unlawful operation of a provider-sponsored
26 organization without a subsisting certificate of authority,
27 the department shall also issue an order requiring the
28 violator to cease and desist from engaging in such method of
29 competition, act, or practice or unlawful operation of a
30 provider-sponsored organization. Further, if the act or
31 practice constitutes a violation of s. 641.4642 or s.
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1 641.4644, the department may, at its discretion, order any one
2 or more of the following:
3 (1) Suspension or revocation of the provider-sponsored
4 organization's certificate of authority if it knew, or
5 reasonably should have known, it was in violation of this
6 part.
7 (2) If it is determined that the person or entity
8 charged has engaged in the business of operating a
9 provider-sponsored organization without a certificate of
10 authority, unless a waiver has been granted by the Secretary
11 of the United States Department of Health and Human Services
12 under s. 1855(a)(2) of the Balanced Budget Act of 1997, an
13 administrative penalty, which may not exceed $1,000 for each
14 provider-sponsored contract offered or effectuated.
15 641.4646 Appeals from the department.--Any person,
16 entity, or provider-sponsored organization that is subject to
17 an order of the department under s. 641.4645 or s. 641.4647
18 may obtain a review of the order by filing an appeal therefrom
19 in accordance with the procedures for appeal under s. 120.68.
20 641.4647 Penalty for violating cease and desist
21 orders.--Any person, entity, or provider-sponsored
22 organization that violates a cease and desist order of the
23 department under s. 641.4645 while such order is in effect,
24 after notice and hearing as provided in s. 641.4644, is
25 subject, at the discretion of the department, to any one or
26 more of the following:
27 (1) A monetary penalty of not more than $200,000 as to
28 all matters determined in the hearing.
29 (2) Suspension or revocation of the provider-sponsored
30 organization's certificate of authority.
31
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1 641.4648 Civil liability.--The provisions of this part
2 are cumulative to rights under the general civil and common
3 law, and an action by the department does not abrogate any
4 right to damages or other relief in any court.
5 Section 2. Section 641.227, Florida Statutes, is
6 amended to read:
7 641.227 Rehabilitation Administrative Expense Fund.--
8 (1) The department may shall not issue or permit to
9 exist a certificate of authority to operate a health
10 maintenance organization or provider-sponsored organization in
11 this state unless the organization has deposited with the
12 department $10,000 in cash for use in the Rehabilitation
13 Administrative Expense Fund as established in subsection (2).
14 (2) The department shall maintain all deposits
15 received under this section and all income from such deposits
16 in trust in an account titled "Rehabilitation Administrative
17 Expense Fund." The fund shall be administered by the
18 department and shall be used for the purpose of payment of the
19 administrative expenses of the department during any
20 rehabilitation of a health maintenance organization or
21 provider-sponsored organization, when rehabilitation is
22 ordered by a court of competent jurisdiction.
23 (3) Upon successful rehabilitation of a health
24 maintenance organization or provider-sponsored organization,
25 the organization shall reimburse the fund for the amount of
26 expenses incurred by the department during the court-ordered
27 rehabilitation period.
28 (4) If a court of competent jurisdiction orders
29 liquidation of a health maintenance organization or
30 provider-sponsored organization, the fund shall be reimbursed
31
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1 for expenses incurred by the department as provided for in
2 chapter 631.
3 (5) Each deposit made under this section shall be
4 allowed as an asset for purposes of determination of the
5 financial condition of the health maintenance organization or
6 provider-sponsored organization. The deposit shall be
7 refunded to the organization only when the organization both
8 ceases operation as a health maintenance organization or
9 provider-sponsored organization and no longer holds a
10 subsisting certificate of authority.
11 Section 3. Paragraph (b) of subsection (2) and
12 subsection (5) of section 641.316, Florida Statutes, are
13 amended to read:
14 641.316 Fiscal intermediary services.--
15 (2)
16 (b) The term "fiscal intermediary services
17 organization" means a person or entity that which performs
18 fiduciary or fiscal intermediary services to health care
19 professionals who contract with health maintenance
20 organizations or provider-sponsored organizations other than a
21 fiscal intermediary services organization owned, operated, or
22 controlled by a hospital licensed under chapter 395, an
23 insurer licensed under chapter 624, a third-party
24 administrator licensed under chapter 626, a prepaid limited
25 health organization licensed under chapter 636, a health
26 maintenance organization licensed under this chapter, or a
27 provider-sponsored organization licensed under this chapter,
28 or physician group practices as defined in s. 455.236(3)(f).
29 (5) Any fiscal intermediary services organization,
30 other than a fiscal intermediary services organization owned,
31 operated, or controlled by a hospital licensed under chapter
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1 395, an insurer licensed under chapter 624, a third-party
2 administrator licensed under chapter 626, a prepaid limited
3 health organization licensed under chapter 636, a health
4 maintenance organization licensed under this chapter, a
5 provider-sponsored organization licensed under this chapter,
6 or physician group practices as defined in s. 455.236(3)(f),
7 must register with the department and meet the requirements of
8 this section. In order to register as a fiscal intermediary
9 services organization, the organization must comply with ss.
10 641.21(1)(c) and (d) and 641.22(6). Should the department
11 determine that the fiscal intermediary services organization
12 does not meet the requirements of this section, the
13 registration shall be denied. In the event that the registrant
14 fails to maintain compliance with the provisions of this
15 section, the department may revoke or suspend the
16 registration. In lieu of revocation or suspension of the
17 registration, the department may levy an administrative
18 penalty in accordance with s. 641.25.
19 Section 4. A provider-sponsored organization is exempt
20 from section 455.654, Florida Statutes, for the provision of
21 health care services to enrollees of a Medicare Choice plan.
22 Section 5. Subsections (9), (10), (11), (13), and (16)
23 of section 641.47, Florida Statutes, are amended to read:
24 641.47 Definitions.--As used in this part, the term:
25 (9) "Geographic area" means the county or counties, or
26 any portion of a county or counties, within which the health
27 maintenance organization or provider-sponsored organization
28 provides or arranges for comprehensive health care services to
29 be available to its subscribers.
30
31
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1 (10) "Grievance" means a written complaint submitted
2 by or on behalf of a subscriber to an organization or a state
3 agency regarding the:
4 (a) Availability, coverage for the delivery, or
5 quality of health care services, including a complaint
6 regarding an adverse determination made pursuant to
7 utilization review;
8 (b) Claims payment, handling, or reimbursement for
9 health care services; or
10 (c) Matters pertaining to the contractual relationship
11 between a subscriber and an organization.
12
13 A grievance does not include a written complaint submitted by
14 or on behalf of a subscriber eligible for a grievance and
15 appeals procedure provided by an organization pursuant to
16 contract with the Federal Government under Title XVIII of the
17 Social Security Act which is governed by the rules established
18 by the Secretary of the United States Department of Health and
19 Human Services under the Balanced Budget Act of 1997, as it
20 applies to provider-sponsored organizations that offer
21 Medicare Choice plans.
22 (11) "Health care services" means:
23 (a) Comprehensive health care services, as defined in
24 s. 641.19, when applicable to a health maintenance
25 organization.
26 (b) The benefit package for Medicare beneficiaries
27 established by the Federal Government, when applicable to a
28 provider-sponsored organization., and means
29 (c) Basic services, as defined in s. 641.402, when
30 applicable to a prepaid health clinic.
31
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1 (13) "Organization" means any health maintenance
2 organization as defined in s. 641.19, any provider-sponsored
3 organization as defined in s. 641.4603, and any prepaid health
4 clinic as defined in s. 641.402.
5 (16) "Subscriber" means an individual who has
6 contracted, or on whose behalf a contract has been entered
7 into, with a health maintenance organization for health care
8 services. In the case of a provider-sponsored organization as
9 defined in s. 641.4603, the term also means a Medicare
10 beneficiary.
11 Section 6. Section 641.48, Florida Statutes, is
12 amended to read:
13 641.48 Purpose and application of part.--The purpose
14 of this part is to ensure that health maintenance
15 organizations, provider-sponsored organizations, and prepaid
16 health clinics deliver high-quality health care to their
17 subscribers. To achieve this purpose, this part requires all
18 such organizations to obtain a health care provider
19 certificate from the agency as a condition precedent to
20 obtaining a certificate of authority to do business in Florida
21 from the Department of Insurance, under part I, or part II, or
22 part III of this chapter.
23 Section 7. Section 641.49, Florida Statutes, is
24 amended to read:
25 641.49 Certification of health maintenance
26 organization, provider-sponsored organization, and prepaid
27 health clinic as health care providers; application
28 procedure.--
29 (1) A No person or governmental unit may not shall
30 establish, conduct, or maintain a health maintenance
31 organization, a provider-sponsored organization, or a prepaid
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1 health clinic in this state without first obtaining a health
2 care provider certificate under this part.
3 (2) The Department of Insurance may shall not issue a
4 certificate of authority under part I, or part II, or part III
5 of this chapter to any applicant that which does not possess a
6 valid health care provider certificate issued by the agency
7 under this part.
8 (3) Each application for a health care provider
9 certificate must shall be on a form prescribed by the agency.
10 The following information and documents shall be submitted by
11 an applicant and maintained, after certification under this
12 part, by each organization and shall be available for
13 inspection or examination by the agency at the offices of an
14 organization at any time during regular business hours. The
15 agency shall give reasonable notice to an organization prior
16 to any onsite inspection or examination of its records or
17 premises conducted under this section. The agency may require
18 that the following information or documents be submitted with
19 the application:
20 (a) A copy of the articles of incorporation and all
21 amendments to the articles.
22 (b) A copy of the bylaws, rules and regulations, or
23 similar form of document, if any, regulating the conduct of
24 the affairs of the applicant or organization.
25 (c) A list of the names, addresses, and official
26 capacities with the applicant or organization of the persons
27 who are to be responsible for the conduct of the affairs of
28 the applicant or organization, including all officers and
29 directors of the corporation. Such persons shall fully
30 disclose to the agency and the directors of the applicant or
31 organization the extent and nature of any contracts or
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1 arrangements between them and the applicant or organization,
2 including any possible conflicts of interest.
3 (d) The name and address of the applicant and the name
4 by which the applicant or organization is to be known.
5 (e) A statement generally describing the applicant or
6 organization and its operations.
7 (f) A copy of the form for each group and individual
8 contract, certificate, subscriber handbook, and any other
9 similar documents issued to subscribers.
10 (g) A statement describing the manner in which health
11 care services shall be regularly available.
12 (h) A statement that the applicant has an established
13 network of health care providers which is capable of providing
14 the health care services that are to be offered by the
15 organization.
16 (i) The locations at which health care services shall
17 be regularly available to subscribers.
18 (j) The type of health care personnel engaged to
19 provide the health care services and the quantity of the
20 personnel of each type.
21 (k) A statement giving the present and projected
22 number of subscribers to be enrolled yearly for the next 3
23 years.
24 (l) A statement indicating the source of emergency
25 services and care on a 24-hour basis.
26 (m) A statement that the physicians employed by the
27 applicant have been formally organized as a medical staff and
28 that the applicant's governing body has designated a chief of
29 medical staff.
30 (n) A statement describing the manner in which the
31 applicant or organization assures the maintenance of a medical
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1 records system in accordance with accepted medical records'
2 standards and practices.
3 (o) If general anesthesia is to be administered in a
4 facility not licensed by the agency, a copy of architectural
5 plans that meet the requirements for institutional occupancy
6 (NFPA 101 Life Safety Code, current edition as adopted by the
7 State Fire Marshal).
8 (p) A description of the applicant's or organization's
9 internal quality assurance program, including committee
10 structure, as required under s. 641.51.
11 (q) A description and supporting documentation
12 concerning how the applicant or health maintenance
13 organization will comply with internal risk management program
14 requirements under s. 641.55.
15 (r) An explanation of how coverage for emergency
16 services and care is to be effected outside the applicant's or
17 health maintenance organization's stated geographic area.
18 (s) A statement and map describing with reasonable
19 accuracy the specific geographic area to be served.
20 (t) A nonrefundable application fee of $1,000.
21 (u) Such additional information as the agency may
22 reasonably require.
23 Section 8. Subsections (1) and (3) of section 641.495,
24 Florida Statutes, are amended to read:
25 641.495 Requirements for issuance and maintenance of
26 certificate.--
27 (1) The agency shall, within 90 days after receipt,
28 issue a health care provider certificate to an applicant
29 filing a completed application in conformity with ss. 641.48
30 and 641.49, upon payment of the prescribed fee, and upon the
31 agency's being satisfied that the applicant has the ability to
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1 provide quality of care consistent with the prevailing
2 professional standards of care and which applicant otherwise
3 meets the requirements of this part.
4 (3) The organization shall demonstrate its capability
5 to provide health care services in the geographic area that it
6 proposes to service. In addition, each health maintenance
7 organization or provider-sponsored organization shall notify
8 the agency of its intent to expand its geographic area at
9 least 60 days prior to the date it plans to begin providing
10 health care services in the new area. Prior to the date the
11 health maintenance organization or provider-sponsored
12 organization begins enrolling members in the new area, it must
13 submit a notarized affidavit, signed by two officers of the
14 organization who have the authority to legally bind the
15 organization, to the agency describing and affirming its
16 existing and projected capability to provide health care
17 services to its projected number of subscribers in the new
18 area. The notarized affidavit shall further assure that, 15
19 days prior to providing health care services in the new area,
20 the health maintenance organization or provider-sponsored
21 organization shall be able, through documentation or
22 otherwise, to demonstrate that it shall be capable of
23 providing services to its projected subscribers for at least
24 the first 60 days of operation. If the agency determines that
25 the organization is not capable of providing health care
26 services to its projected number of subscribers in the new
27 area, the agency may issue an order as required under chapter
28 120 prohibiting the organization from expanding into the new
29 area. In any proceeding under chapter 120, the agency shall
30 have the burden of establishing that the organization is not
31
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1 capable of providing health care services to its projected
2 number of subscribers in the new area.
3 Section 9. Paragraph (c) of subsection (4) of section
4 641.51, Florida Statutes, is amended to read:
5 641.51 Quality assurance program; second medical
6 opinion requirement.--
7 (4)
8 (c) For second opinions provided by contract
9 physicians the organization is prohibited from charging a fee
10 to the subscriber in an amount in excess of the subscriber
11 fees established by contract for referral contract physicians.
12 The organization shall pay the amount of all charges, which
13 are usual, reasonable, and customary in the community, for
14 second opinion services performed by a physician not under
15 contract with the organization, but may require the subscriber
16 to be responsible for up to 40 percent of such amount. The
17 organization may require that any tests deemed necessary by a
18 noncontract physician shall be conducted by the organization.
19 The organization may deny reimbursement rights granted under
20 this section in the event the subscriber seeks in excess of
21 three such referrals per year if such subsequent referral
22 costs are deemed by the organization to be evidence that the
23 subscriber has unreasonably overutilized the second opinion
24 privilege. A subscriber thus denied reimbursement under this
25 section shall have recourse to grievance procedures as
26 specified in ss. 408.7056, 641.495, and 641.511. The
27 organization's physician's professional judgment concerning
28 the treatment of a subscriber derived after review of a second
29 opinion shall be controlling as to the treatment obligations
30 of the health maintenance organization or provider-sponsored
31 organization. Treatment not authorized by the health
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1 maintenance organization or provider-sponsored organization
2 shall be at the subscriber's expense.
3 Section 10. Section 641.512, Florida Statutes, is
4 amended to read:
5 641.512 Accreditation and external quality assurance
6 assessment.--
7 (1)(a) To promote the quality of health care services
8 provided by health maintenance organizations,
9 provider-sponsored organizations, and prepaid health clinics
10 in this state, the department shall require each health
11 maintenance organization, provider-sponsored organizations,
12 and prepaid health clinic to be accredited within 1 year after
13 of the organization's receipt of its certificate of authority
14 and to maintain accreditation by an accreditation organization
15 approved by the department, as a condition of doing business
16 in the state.
17 (b) If an In the event that no accreditation
18 organization is not can be approved by the department, the
19 department shall require each health maintenance organization,
20 provider-sponsored organization, and prepaid health clinic to
21 have an external quality assurance assessment performed by a
22 review organization approved by the department, as a condition
23 of doing business in the state. The assessment shall be
24 conducted within 1 year after of the organization's receipt of
25 its certificate of authority and every 2 years thereafter, or
26 when the department deems additional assessments necessary.
27 (2) The accreditation or review organization must have
28 nationally recognized experience in the activities of a health
29 maintenance organization or a provider-sponsored organization
30 activities and in the appraisal of medical practice and
31 quality assurance in the setting of a health maintenance
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1 organization or a provider-sponsored organization setting. The
2 accreditation or review organization may shall not currently
3 be involved in the operation of the health maintenance
4 organization, provider-sponsored organization, or prepaid
5 health clinic, or nor in the delivery of health care services
6 to its subscribers. The accreditation or review organization
7 may shall not have contracted or conducted consultations
8 within the last 2 years for other than accreditation purposes
9 of the health maintenance organization, provider-sponsored
10 organization, or prepaid health clinic seeking accreditation
11 or under quality assurance assessment.
12 (3) A representative of the department shall accompany
13 the accreditation or review organization throughout the
14 accreditation or assessment process, but may shall not
15 participate in the final accreditation or assessment
16 determination. The accreditation or review organization shall
17 monitor and evaluate the quality and appropriateness of
18 patient care, the organization's pursuance of opportunities to
19 improve patient care and resolve identified problems, and the
20 effectiveness of the internal quality assurance program
21 required for the certification of a health maintenance
22 organization, a provider-sponsored organization, or a and
23 prepaid health clinic certification pursuant to s.
24 641.49(3)(p) s. 641.49(3)(o).
25 (4) The accreditation or assessment process shall
26 include a review of:
27 (a) All documentation necessary to determine the
28 current professional credentials of employed health care
29 providers or physicians providing service under contract to
30 the health maintenance organization, provider-sponsored
31 organization, or prepaid health clinic.
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1 (b) At least a representative sample of not fewer than
2 50 medical records of individual subscribers. When selecting
3 a sample, any and all medical records may be subject to
4 review. The sample of medical records shall be representative
5 of all subscribers' records.
6 (5) Every organization shall submit its books,
7 documentations, and medical records and take appropriate
8 action as may be necessary to facilitate the accreditation or
9 assessment process.
10 (6) The accreditation or review organization shall
11 issue a written report of its findings to the board of
12 directors of the health maintenance organization, the
13 provider-sponsored organization, organization's or the prepaid
14 health clinic clinic's board of directors. A copy of the
15 report shall be submitted to the department by the
16 organization within 30 business days after of its receipt by
17 the health maintenance organization, provider-sponsored
18 organization, or prepaid health clinic.
19 (7) The expenses of the accreditation or assessment
20 process of each organization, including any expenses incurred
21 pursuant to this section, shall be paid by the organization.
22 Section 11. Section 641.513, Florida Statutes, is
23 amended to read:
24 641.513 Requirements for providing emergency services
25 and care.--
26 (1) In providing for emergency services and care as a
27 covered service, a health maintenance organization or a
28 provider-sponsored organization may not:
29 (a) Require prior authorization for the receipt of
30 prehospital transport or treatment or for emergency services
31 and care.
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1 (b) Indicate that emergencies are covered only if care
2 is secured within a certain period of time.
3 (c) Use terms such as "life threatening" or "bona
4 fide" to qualify the kind of emergency that is covered.
5 (d) Deny payment based on the subscriber's failure to
6 notify the health maintenance organization or
7 provider-sponsored organization in advance of seeking
8 treatment or within a certain period of time after the care is
9 given.
10 (2) Prehospital and hospital-based trauma services and
11 emergency services and care must be provided to a subscriber
12 of a health maintenance organization or provider-sponsored
13 organization as required under ss. 395.1041, 395.4045, and
14 401.45.
15 (3)(a) When a subscriber is present at a hospital
16 seeking emergency services and care, the determination as to
17 whether an emergency medical condition, as defined in s.
18 641.47 exists shall be made, for the purposes of treatment, by
19 a physician of the hospital or, to the extent permitted by
20 applicable law, by other appropriate licensed professional
21 hospital personnel under the supervision of the hospital
22 physician. The physician or the appropriate personnel shall
23 indicate in the patient's chart the results of the screening,
24 examination, and evaluation. The health maintenance
25 organization or provider-sponsored organization shall
26 compensate the provider for the screening, evaluation, and
27 examination that is reasonably calculated to assist the health
28 care provider in arriving at a determination as to whether the
29 patient's condition is an emergency medical condition. The
30 health maintenance organization or provider-sponsored
31 organization shall compensate the provider for emergency
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1 services and care. If a determination is made that an
2 emergency medical condition does not exist, payment for
3 services rendered subsequent to that determination is governed
4 by the contract under which the subscriber is covered.
5 (b) If a determination has been made that an emergency
6 medical condition exists and the subscriber has notified the
7 hospital, or the hospital emergency personnel otherwise have
8 knowledge that the patient is a subscriber of the health
9 maintenance organization or provider-sponsored organization,
10 the hospital must make a reasonable attempt to notify the
11 subscriber's primary care physician, if known, or the health
12 maintenance organization or provider-sponsored organization,
13 if the health maintenance organization or provider-sponsored
14 organization had previously requested in writing that the
15 notification be made directly to the health maintenance
16 organization or provider-sponsored organization, of the
17 existence of the emergency medical condition. If the primary
18 care physician is not known, or has not been contacted, the
19 hospital must:
20 1. Notify the health maintenance organization or
21 provider-sponsored organization as soon as possible prior to
22 discharge of the subscriber from the emergency care area; or
23 2. Notify the health maintenance organization or
24 provider-sponsored organization within 24 hours or on the next
25 business day after admission of the subscriber as an inpatient
26 to the hospital.
27
28 If notification required by this paragraph is not
29 accomplished, the hospital must document its attempts to
30 notify the health maintenance organization or
31 provider-sponsored organization of the circumstances that
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1 precluded attempts to notify the health maintenance
2 organization or provider-sponsored organization. A health
3 maintenance organization or provider-sponsored organization
4 may not deny payment for emergency services and care based on
5 a hospital's failure to comply with the notification
6 requirements of this paragraph. Nothing in This paragraph does
7 not shall alter any contractual responsibility of a subscriber
8 to make contact with the health maintenance organization or
9 provider-sponsored organization subsequent to receiving
10 treatment for the emergency medical condition.
11 (c) If the subscriber's primary care physician
12 responds to the notification, the hospital physician and the
13 primary care physician may discuss the appropriate care and
14 treatment of the subscriber. The health maintenance
15 organization or provider-sponsored organization may have a
16 member of the hospital staff with whom it has a contract
17 participate in the treatment of the subscriber within the
18 scope of the physician's hospital staff privileges. The
19 subscriber may be transferred, in accordance with state and
20 federal law, to a hospital that has a contract with the health
21 maintenance organization or provider-sponsored organization
22 and has the service capability to treat the subscriber's
23 emergency medical condition. Notwithstanding any other state
24 law, a hospital may request and collect insurance or financial
25 information from a patient in accordance with federal law,
26 which is necessary to determine if the patient is a subscriber
27 of a health maintenance organization or provider-sponsored
28 organization, if emergency services and care are not delayed.
29 (4) A subscriber may be charged a reasonable
30 copayment, as provided in s. 641.31(12), for the use of an
31 emergency room.
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1 (5) Reimbursement for services pursuant to this
2 section by a provider who does not have a contract with the
3 health maintenance organization or provider-sponsored
4 organization shall be the lesser of:
5 (a) The provider's charges;
6 (b) The usual and customary provider charges for
7 similar services in the community where the services were
8 provided; or
9 (c) The charge mutually agreed to by the health
10 maintenance organization or provider-sponsored organization
11 and the provider within 60 days after of the submittal of the
12 claim.
13
14 Such reimbursement shall be net of any applicable copayment
15 authorized pursuant to subsection (4).
16 (6) Reimbursement for services under this section
17 provided to subscribers who are Medicaid recipients by a
18 provider for whom no contract exists between the provider and
19 the health maintenance organization or provider-sponsored
20 organization shall be the lesser of:
21 (a) The provider's charges;
22 (b) The usual and customary provider charges for
23 similar services in the community where the services were
24 provided;
25 (c) The charge mutually agreed to by the entity and
26 the provider within 60 days after submittal of the claim; or
27 (d) The Medicaid rate.
28 Section 12. Subsection (4) of section 641.515, Florida
29 Statutes, is amended to read:
30 641.515 Investigation by the agency.--
31
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1 (4) The agency shall adopt promulgate rules imposing
2 upon physicians and hospitals performing services for a health
3 maintenance organization or provider-sponsored organization
4 standards of care generally applicable to physicians and
5 hospitals.
6 Section 13. Subsections (1) and (2) of section 641.54,
7 Florida Statutes, are amended to read:
8 641.54 Information disclosure.--
9 (1) Every health maintenance organization or
10 provider-sponsored organization shall maintain a current list,
11 by geographic area, of all hospitals that which are routinely
12 and regularly used by the organization, indicating to which
13 hospitals the organization may refer particular subscribers
14 for nonemergency services. The list shall also include all
15 physicians under the organization's direct employ or who are
16 under contract or other arrangement with the organization to
17 provide health care services to subscribers. The list shall
18 contain the following information for each physician:
19 (a) Name.
20 (b) Office location.
21 (c) Medical area or areas of specialty.
22 (d) Board certification or eligibility in any area.
23 (e) License number.
24 (2) The list shall be made available, upon request, to
25 the department. The list shall also be made available, upon
26 request:
27 (a) With respect to negotiation, application, or
28 effectuation of a group health maintenance contract, to the
29 employer or other person who will hold the contract on behalf
30 of the subscriber group. The list may be restricted to
31
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1 include only physicians and hospitals in the group's
2 geographic area.
3 (b) With respect to an individual health maintenance
4 contract or any contract offered to a person who is entitled
5 to have payments for health care costs made under Medicare, to
6 the person considering or making application to, or under
7 contract with, the health maintenance organization or
8 provider-sponsored organization. The list may be restricted
9 to include only physicians and hospitals in the person's
10 geographic area.
11 Section 14. Section 641.59, Florida Statutes, is
12 amended to read:
13 641.59 Psychotherapeutic services; records and
14 reports.--A health maintenance organization,
15 provider-sponsored organization, or prepaid health clinic, as
16 defined in this chapter, must maintain strict confidentiality
17 against unauthorized or inadvertent disclosure of confidential
18 information to persons inside or outside the health
19 maintenance organization, provider-sponsored organization, or
20 prepaid health clinic regarding psychotherapeutic services
21 provided to subscribers by psychotherapists licensed under
22 chapter 490 or chapter 491 and psychotherapeutic records and
23 reports related to the services. A report, in lieu of records,
24 may be submitted by a psychotherapist in support of the
25 services. Such report must include clear statements
26 summarizing the subscriber's presenting symptoms, what
27 transpired in any provided therapy, what progress, if any, was
28 made by the subscriber, and results obtained. However, the
29 health maintenance organization, provider-sponsored
30 organization, or prepaid health clinic may require the records
31 upon which the report is based, if the report does not contain
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1 sufficient information supporting the services. A
2 psychotherapist submitting records in support of services may
3 obscure portions to conceal the names, identities, or
4 identifying information of people other than the subscriber if
5 this information is unnecessary to utilization review, quality
6 management, discharge planning, case management, or claims
7 processing conducted by the health maintenance organization,
8 provider-sponsored organization, or prepaid health clinic. A
9 health maintenance organization, provider-sponsored
10 organization, or prepaid health clinic may provide aggregate
11 data that which does not disclose subscriber identities or
12 identities of other persons to entities such as payors,
13 sponsors, researchers, and accreditation bodies.
14 Section 15. Paragraph (f) of subsection (1) of section
15 641.60, Florida Statutes, is amended to read:
16 641.60 Statewide Managed Care Ombudsman Committee.--
17 (1) As used in ss. 641.60-641.75:
18 (f) "Managed care program" means a health care
19 delivery system that emphasizes primary care and integrates
20 the financing and delivery of services to enrolled individuals
21 through arrangements with selected providers, formal quality
22 assurance and utilization review, and financial incentives for
23 enrollees to use the program's providers. Such a health care
24 delivery system may include arrangements in which providers
25 receive prepaid set payments to coordinate and deliver all
26 inpatient and outpatient services to enrollees or arrangements
27 in which providers receive a case management fee to coordinate
28 services and are reimbursed on a fee-for-service basis for the
29 services they provide. A managed care program may include a
30 state-licensed health maintenance organization, a
31 provider-sponsored organization, a Medicaid prepaid health
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1 plan, a Medicaid primary care case management program, or
2 other similar program.
3 Section 16. This act shall take effect October 1,
4 1998.
5
6 *****************************************
7 SENATE SUMMARY
8 Creates the "Provider-Sponsored Organization Act" within
ch. 641, F.S. Authorizes provider-sponsored organizations
9 to do business in this state and offer health care
coverage to Medicare beneficiaries under the federal
10 Medicare Choice plan. Provides for the regulation of
provider-sponsored organizations by the Department of
11 Insurance in a manner similar to the regulation of health
maintenance organizations. Requires that the department
12 issue certificates of authority to qualified
provider-sponsored organizations. Requires that a
13 provider-sponsored organization maintain certification as
a health care provider. Authorizes the department to
14 conduct inspections, issue cease and desist orders, and
impose penalties. Provides requirements for a
15 provider-sponsored organization in marketing its services
and in soliciting subscribers. Prohibits certain unfair
16 and deceptive trade practices and acts. Provides
penalties. Authorizes the department to adopt rules. (See
17 bill for details.)
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