Alabama Administrative Code › Title 482 - ALABAMA DEPARTMENT OF INSURANCE › Chapter 482-1-079 - HEALTH MAINTENANCE ORGANIZATIONS GENERALLY › Section 482-1-079-.13 - Change Of Ownership Or Management

Current through Register Vol. 42, No. 9, June 28, 2024
Each HMO which desires to transfer ownership of more than 5% of
				the stock or ownership interest or control in the HMO shall not do so without
				first submitting the proposed plan to the Commissioner for review and approval
				or disapproval in accordance with Section
				27-29-3,
Code of Ala.
				1975
. Any change of control shall be governed by the disclosure
				requirements of Alabama Insurance Regulation Chapter 482-1-055 entitled
				"Insurance Holding Company Registration and Disclosure."
The HMO shall promptly furnish the Commissioner written notice
				within thirty days of their election or appointment of any change of personnel
				among the directors or principal officers of the HMO.
Any management contractor who shall manage the financial
				affairs, investment affairs or any of the health care activities of the HMO
				shall be subject to prior approval by the Commissioner with the advice of the
				State Health Officer. In no instance shall the board of directors of the HMO
				relinquish the right to dismiss the management contractor for failure to
				perform his required duties.
Management contracts shall be effective only with the prior
				written consent of the Commissioner in accordance with Section
				27-21A-4 supra and shall include
				the following:
(1) A description of
			 the proposed role of the HMO governing authority during the term of the
			 proposed management contract. The description shall clearly reflect retention
			 by the governing authority of the HMO of ongoing responsibility for statutory
			 and regulatory compliance;
(2) A
			 provision that clearly recognizes that the responsibilities of the governing
			 authority of the HMO are in no way obviated by entering a management contract
			 and that any powers not specifically delegated to the management contractor
			 through the provisions of the contract remain with the governing authority of
			 the HMO;
(3) A plan for assuring
			 maintenance of the fiscal stability, the level of services provided and the
			 quality of care rendered by the HMO during the term of the management
			 contract;
(4) A provision that
			 annual reports on the financial operations and any other operational data
			 requested by the governing authority of the HMO, the State Health Officer or
			 the Commissioner will be provided by the management contractor;
(5) A provision stating that the management
			 contract approved by the Commissioner shall be the sole agreement between the
			 management contractor and the governing authority of the HMO for the purpose of
			 management of the HMO and payment to the management contractor for management
			 services, and that any amendments or revisions to the management contract shall
			 be effective only with the prior written consent of the Commissioner;
			 and
(6) Specification of payment
			 terms that are reasonable and do not jeopardize the financial solvency of the
			 HMO.
If these management contracts are not disapproved within thirty
				(30) days of filing they shall be deemed approved.
Author:
Commissioner of Insurance
Statutory Authority:
Code of Ala.
				  1975
, §§
										27-2-17,
				  27-21A-19.