2005 Idaho Code - 41-3905 — QUALIFICATIONS FOR CERTIFICATE OF AUTHORITY

                                  TITLE  41
                                  INSURANCE
                                  CHAPTER 39
                             MANAGED CARE REFORM
    41-3905.  QUALIFICATIONS FOR CERTIFICATE OF AUTHORITY. The director shall
not issue or permit to remain in force a certificate of authority authorizing
the transaction of managed care plans unless the organization offering the
managed care plan is qualified therefor as follows:
    (1)  It must be empowered to engage in business as a managed care
organization under its articles or certificate of incorporation, or of
association, or partnership agreement, or other basic organizational document,
as the case may be.
    (2)  It must be financially responsible, and have such funds and financial
resources as may reasonably be expected to enable it to fulfill its
obligations to its members. An organization offering a general managed care
plan must comply with the capital and surplus requirements of a disability
insurer under the provisions of section 41-313, Idaho Code. The director shall
determine the surplus required of an organization offering a limited managed
care plan, which shall be not less than twenty-five  thousand  dollars
($25,000) or such increased amount as the director may find reasonably
necessary by the scope of the organization's proposed operations. As to
financial resources of an organization offering a limited managed care plan
the director may, among other relevant factors, also consider:
    (a)  Any agreements with an insurer, professional service corporation,
    governmental agency, or other responsible organization to underwrite,
    insure payment for or provide the proposed services;
    (b)  Agreements with providers for the provision of  the proposed
    services;
    (c)  Arrangements for liability insurance, or an adequate plan of
    self-insurance, as to claims for loss or injury arising out of managed
    care operations;
    (d)  Reinsurance agreements; and
    (e)  Deposit requirements under subsection (7) of this section.
    (3)  It must propose to provide health care services on a predetermined
and prepaid basis and indemnity benefits covering all or a portion of the cost
of out-of-area services, out-of-network services and emergency services;
provided, however, that except for care provided by primary care providers,
who shall include at least those categories of providers listed in section
41-3915(2)(e), Idaho Code, a managed care organization may require a
determination that a member needs care from a category of provider not listed
in section 41-3915(2)(e), Idaho Code, before a member may access
out-of-network nonemergency care from a provider not listed in section
41-3915(2)(e), Idaho Code.
    (4)  It must have the intent to render and capability for rendering or
providing coverage for good quality health care services, which will be and
are readily available and accessible to members in each geographic area in
which it proposes to operate or operates, and such services must be reasonably
responsive to the needs of members.
    (5)  Its procedures for offering health care services, and for offering
and terminating health care contracts, must be reasonable and equitable.
    (6)  It must propose to establish, and after authorization in fact
establish and maintain, reasonable and adequate procedures to:
    (a)  Monitor the quality of health care provided, including a reasonable
    system of internal peer review of diagnosis and treatment of members'
    health conditions;
    (b)  Resolve grievances of members, as required by section 41-3918, Idaho
    Code; and
    (c)  Provide members with an opportunity to participate in matters of
    policy and operation as required by section 41-3916, Idaho Code.
    (7)  It must comply with the deposit requirements of section 41-316 or
41-316A, Idaho Code, as applicable; provided however, that the amount of the
deposit required of an organization offering a limited managed care plan shall
be equal to the surplus required of the organization pursuant to subsection
(2) of this section.
    (8)  Notwithstanding anything to the contrary in this chapter, the
director may allow a period of up to three (3) years following the issuance of
a certificate of authority to a managed care organization after the effective
date of this act to comply with the capital, surplus and deposit requirements
of this chapter.  The director shall establish minimum initial amounts and
minimum increases in capital, surplus and deposits for such certificate holder
based upon the number of enrolled members in its managed care plans. If the
certificate holder fails to meet the capital, surplus or deposit requirements
within the time herein allowed, the organization shall no longer be authorized
to offer managed care plans on a predetermined and prepaid basis in this
state. If the organization fails to meet the minimum increases established by
the director, the organization shall cease to market its plans upon notice
from the director.
    (9)  Notwithstanding anything to the contrary in this chapter, a managed
care organization holding a valid Idaho certificate of authority to transact
insurance as a health maintenance organization on or before the effective date
of this act may have up to three (3) years from and after that date within
which to comply with the increases in capital, surplus and deposit
requirements imposed by this act.  The director shall establish minimum
increases in capital, surplus and deposits for the certificate holder based
upon the number of enrolled members in its managed care plans. If the
certificate holder fails to meet the capital, surplus or deposit requirements
within the time herein allowed, the organization shall no longer be authorized
to offer managed care plans on a predetermined and prepaid basis in this
state.  If the organization fails to meet the minimum increases established by
the director, the organization shall cease to market its plans upon notice
from the director.