2016 Tennessee Code
Title 56 - Insurance
Chapter 32 - Health Maintenance Organization Act of 1986
§ 56-32-105. Powers -- Limitations -- Hold harmless clause.

(a) The powers of an HMO include, but are not limited to, the following:

(1) The purchase, lease, construction, renovation, operation or maintenance of hospitals or medical facilities, or both, and their ancillary equipment, and property reasonably required for its principal office or for purposes necessary in the transaction of the business of the organization;

(2) The making of loans to a medical group under contract with it in furtherance of its program or the making of loans to a corporation or corporation under its control for the purpose of acquiring or constructing medical facilities and hospitals or in furtherance of a program providing health care services to enrollees;

(3) The furnishing of health care services through providers that are under contract with or employed by the HMO;

(4) The contracting with any person for the performance on its behalf of certain functions, such as marketing, enrollment and administration;

(5) The contracting with an insurance company licensed in this state, or with a hospital or medical service corporation authorized to do business in this state, for the provision of insurance, indemnity, or reimbursement against the cost of health care services provided by the HMO; and

(6) The offering of other health care services, in addition to basic health care services.

(b) An HMO shall file notice, with adequate supporting information, with the commissioner prior to the exercise of any power granted in subdivision (a)(1), (a)(2) or (a)(4), if the dollar amount resulting from such action would exceed twenty-five percent (25%) of surplus. The commissioner shall disapprove the exercise of power only if in the commissioner's opinion it would substantially and adversely affect the financial soundness of the HMO and endanger its ability to meet its obligations. If the commissioner does not disapprove within thirty (30) days of the filing, it shall be deemed approved.

(c) All provider contracts must include a hold harmless clause that will relieve any enrollee of a licensed HMO from any liability for services rendered by the providers except for reasonable copayment and uncovered expenses.