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304.38-130 Revocation or suspension of certificate of authority.
(1)
(2)
(3)
The commissioner may suspend or revoke any certificate of authority issued to a
health maintenance organization under this subtitle if the commissioner finds that
any of the conditions exist for which the commissioner could suspend or revoke a
certificate of authority as provided in Subtitles 2 and 3 of this chapter or if the
commissioner finds that any of the following conditions exist:
(a) The health maintenance organization is operating significantly in
contravention of its basic organizational document or in a manner contrary to
that described in and reasonably inferred from any other information
submitted under KRS 304.38-040, unless amendments to such submissions
have been filed with and approved by the commissioner;
(b) The health maintenance organization issues evidence of coverage or uses a
schedule of charges for health care services which do not comply with the
requirements of KRS 304.38-050 or Subtitle 17A of this chapter;
(c) The health maintenance organization does not provide or arrange for health
care services as approved by the commissioner in KRS 304.38-050(1)(a);
(d) The certificate of need and licensure board certifies to the commissioner that
the health maintenance organization fails to meet the requirements of the
board or that the health maintenance organization is unable to fulfill its
obligations to furnish health care services;
(e) The health maintenance organization is no longer financially responsible and
may reasonably be expected to be unable to meet its obligations to enrollees or
prospective enrollees;
(f) The health maintenance organization, or any person on its behalf, has
advertised or merchandised its services in an untrue, misrepresentative,
misleading, deceptive, or unfair manner;
(g) The continued operation of the health maintenance organization would be
hazardous to its enrollees; or
(h) The health maintenance organization has otherwise failed to substantially
comply with this subtitle.
If the certificate of authority of a health maintenance organization is suspended, the
health maintenance organization shall not, during the period of the suspension,
enroll any additional enrollees except newborn children or other newly acquired
dependents of existing enrollees, and shall not engage in any advertising or
solicitation whatsoever.
If the certificate of authority of a health maintenance organization is revoked, the
organization shall proceed, immediately following the effective date of the order of
revocation, to wind up its affairs, and shall conduct no further business except as
may be essential to the orderly conclusion of the affairs of the organization. It shall
engage in no further advertising or solicitation whatsoever. The commissioner may,
by written order, permit the further operation of the organization as the
commissioner may find to be in the best interest of enrollees, to the end that
enrollees will be afforded the greatest practical opportunity to obtain continuing
health care coverage. If the commissioner permits such further operation the health
maintenance organization will continue to collect the periodic prepayments required
of enrollees.
Effective: July 15, 2010
History: Amended 2010 Ky. Acts ch. 24, sec. 1509, effective July 15, 2010. -Amended 2004 Ky. Acts ch. 24, sec. 43, effective July 13, 2004. -- Created 1974 Ky.
Acts ch. 357, subtit. 38, sec. 13, effective June 21, 1974.
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