California Code of Regulations › Title 28 - Managed Health Care › Division 1 - The Department of Managed Health Care › Chapter 2 - Health Care Service Plans › Article 1 - Exemptions › Section 1300.43.10 - Nonprofit Retirees' Plan

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
A health care service plan which was registered under the
					 Knox-Mills Health Plan Act as in effect on June 30, 1976, whose activity as a
					 plan is limited to reimbursing part or all of the cost of health care services
					 as a supplement to Medicare (Parts A and B) to persons who were retired from
					 professions associated with higher learning after having been employed therein
					 for not less than 10 cumulative years and such persons' spouses, providing all
					 such persons are enrolled in Medicare, is exempted from the provisions of
					 Section 1349 of the Knox-Keene Health Care
					 Service Plan Act of 1975, subject to each of the following conditions:
(a) That such plan is a nonprofit corporation
				  which does not engage, directly or indirectly, in any for profit business,
				  which is not affiliated with (Rule 1300.45(c)) a corporation or other entity
				  which engages, directly or indirectly, in any for profit business, and which
				  does not contract or otherwise arrange for the performance by persons other
				  than its directors, officers or employees of any portion of its administrative
				  or other functions.
(b) That such
				  plan is exempted from federal income tax as an organization described in
				  Section 501(c)(3) of the
				  Internal Revenue Code and from state income tax on similar grounds.
(c) That such plan is a charitable
				  corporation subject to, and in compliance with, the Uniform Supervision of
				  Trustees for Charitable Purposes Act.
(d) That such plan does not directly provide
				  any health care services through entity-owned or contracting health facilities
				  or providers.
(e) That such plan
				  has a tangible net equity within the meaning of Section
				  1300.76(b) of not
				  less than $300,000, including liquid tangible assets in an amount not less than
				  $300,000, based upon its most recent certified financial statement (prepared as
				  of a date within the preceding 15 months and such other date as may be
				  requested by the Director pursuant to Section
				  1384 of the Act) and its most
				  recent quarterly and monthly uncertified statements prepared on a basis
				  consistent with the annual certified statement, with additional liquid tangible
				  assets in an amount not less than $1,000 for each person enrolled in excess of
				  400; provided that the maximum number of enrollees shall not exceed
				  500.
(f) That not more than 15% of
				  the total charges paid by or on behalf of subscribers or enrollees for
				  enrollment in, or for health care benefits from, such plan is expended for
				  administrative costs, including all costs of solicitation and enrollment;
				  except that such plan may expend additional sums of money for administrative
				  costs excluding costs of solicitation and enrollment provided that such money
				  is not derived from revenue obtained from subscribers or enrollees.
(g) That such plan issues a uniform health
				  care service plan contract to all subscribers
(1) which provides, except for a permissible
				  calendar year deductible not to exceed $100 per enrollee, full coverage for all
				  copayments and deductibles relating to allowable charges under Medicare (Parts
				  A and B) for all health care services covered by Medicare (Parts A and B)
				  pursuant to Title XVIII of the Social Security Act as amended, and not less
				  than 50% of the reasonable charges for each health care service which is not
				  covered by Medicare but is covered by such plan; provided, however, that such
				  coverage may be subject to a lifetime limitation allowing not less than
				  $300,000 of benefits per lifetime and
(2) which provides that an enrollment or
				  subscription may not be cancelled except upon grounds complying with Section
				  1365 of the
				  Act.