2009 Rhode Island Code
Title 27 - Insurance
CHAPTER 27-19.2 - Nonprofit Hospital and Medical Service Corporations
§ 27-19.2-4 - Board of directors – Duties and functions of the board of directors.

SECTION 27-19.2-4

   § 27-19.2-4  Board of directors – Duties and functions of the board of directors. – (a) The board of a nonprofit hospital and/or medical service corporation and its individual members are fiduciaries and shall act at all times:

   (1) In utmost good faith;

   (2) In a manner reasonably believed to be in the best interest of fulfilling the corporation's mission or the mission of affiliates or subsidiaries;

   (3) In a manner reflecting undivided loyalty to the furtherance of the corporation's charitable mission;

   (4) At the highest standard of fiduciary care and prudence;

   (5) In accordance with a conflict of interest policy adopted by the board of directors that will be consistent with guidelines recommended and published by the U.S. Internal Revenue Service for nonprofit entities; and

   (6) Physicians who receive compensation from the nonprofit hospital and/or medical service corporation, for services rendered in their professional capacity, directly or indirectly, may serve on board committees that address compensation matters; provided, however, that no such physician member may participate in a vote or deliberate on matters relating to physician compensation.

   (b) The proper and principal functions of the board shall include:

   (1) Ensuring that the corporation effectively carries out the charitable mission for which it was incorporated under § 27-19-2 of this title;

   (2) Selecting corporate management and evaluating its performance in light of the corporation's charitable purpose;

   (3) Recognizing that in the event of a conversion as defined in § 27-66-4(3), the reserves and assets with which they are entrusted are charitable assets, and treating them with according stewardship;

   (4) Establishing a system of board governance including an annual evaluation of board performance measured against the charitable purpose of the corporation; and

   (5) Holding an annual public meeting with proper notice open to providers and subscribers at which comments shall be heard from the floor.