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Subject 120-2-33 HEALTH MAINTENANCE ORGANIZATIONS

Rule 120-2-33-.01 Authority

This Regulation is made and promulgated by the Commissioner of Insurance pursuant to the authority set forth in O.C.G.A. Sections 33-21-18 and 33-2-9.

Rule 120-2-33-.02 Purpose

(1) To govern and regulate various phases of operations of Health Maintenance Organizations ("HMOs").
(2) To protect the interests of the enrolled public.
(3) To provide means by which the quality of care rendered, in conjunction with such Rules and Regulations as may be established by the Commissioner of Human Resources, and the fiscal stability of such organizations can be monitored.

Rule 120-2-33-.03 Definitions

(1) All terms defined in Acts 1979, p. 1148 (O.C.G.A. Chapter 33-21), as amended, hereinafter referred to as the Health Maintenance Organization Act or Act, which are used in this Regulation, shall have the same meaning as in the Act.
(2) The following words and terms, when used in this Regulation, shall have the following meanings:
(a) "Basic Rates" means rates for various categories of individuals that are calculated by or certified by a qualified actuary using reasonable assumptions as to expected medical expenses, administrative expenses and margins for contingencies.
(b) "Commissioner" means the Commissioner of Insurance of the State of Georgia.
(c) "Complaint" means a written expression of concern or displeasure by an enrollee regarding any aspect of the HMO relative to the enrollee which is delivered to the HMO, Department of Insurance or the Department of Human Resources.
(d) "Department" means the Department of Insurance, State of Georgia.
(e) "Governing body" means the Board of Directors, or if otherwise designated in the Charter or Bylaws, those individuals vested with the ultimate responsibility for the management of a corporation which has been issued or is applying for a certificate of authority to operate as a Health Maintenance Organization.
(f) "Public Member" means an individual who has no vested interest, financial or otherwise, in the operations of the HMO by reason of his relationship with the HMO as an employee, provider, stockholder or director.

Rule 120-2-33-.04 Establishment of Health Maintenance Organizations

(1) All applications for a certificate of authority will be reviewed in accordance with the standards set forth in the Act, these rules and the Rules and Regulations of the Department of Human Resources.
(2) An applicant applying for a certificate of authority to operate an HMO in the State of Georgia, shall fully comply with the requirements of O.C.G.A. Chapter 33-21. An applicant shall fully and truthfully supply and insert the information required in the following listed forms which have been adopted for use by Order of the Commissioner, and shall provide such other information as the Commissioner may require:
(a) Form GID-2-HMO, the Application; Form GID-3-HMO, Appointment of Attorney for Service of Process; Forms GID-5a, 5b and 5c, as applicable for a Security Deposit; Forms GID-6, and 6c as applicable for a Security Deposit; and Form GID-41, Biographical Affidavit for the principal officers and directors of the HMO.
(b) A Foreign or Alien HMO shall provide, in addition to the items listed in (a) above, Form GID-4-HMO, Appointment of Commissioner as Attorney for Service of Process.
(3) The HMO shall submit to the Commissioner as part of its application for approval every contract, policy, certificate or evidence of coverage, rider, endorsement, application or outline of coverage which it intends to use prior to use.
(4) All HMOs are subject to the fees and taxes required by O.C.G.A. Chapter 33-8.

Rule 120-2-33-.05 Change in HMO Status or Services

(1) No name, other than that approved by the Commissioner, may be used by the HMO and the name of the HMO may not be changed without prior approval of the Commissioner.
(2) No HMO may change a service within the contract period, unless approved arrangements equitable to enrollees are made providing for a rate adjustment or substitution or an equivalent service, and prior approval of the Commissioner is obtained.

Rule 120-2-33-.06 Termination of Coverage or Service

(1) No HMO may cancel or refuse to renew the coverage of an enrollee for any reason which is not related to nonpayment of premium except as provided by the Rules and Regulations of the Office of Commissioner of Insurance Chapter 120-2-67.
(2) No HMO may cease offering a service or terminate a service within a contract period, unless approved arrangements equitable to enrollees are made providing for a rate adjustment or substitution of an equivalent service, and prior approval of the Commissioner is obtained.
(3) When an HMO terminates all or a portion of an enrollee's coverage, or the enrollee, access must be provided to the complaint system set forth in Rule 120-2-33-.09. No such termination shall be effective until the enrollee, if he so desires, and in accordance with the Act and Rule 120-2-33-.09, has exhausted the complaint system.
(4) Notwithstanding paragraphs (5) and (6), an HMO offering a point of service policy form may not terminate coverage under that policy form for a group or individual because no member of that group lives, resides, or works in the approved service area, or, in the case of individual policy coverage, the insured no longer lives, resides, or works in the approved service area.
(5) The HMO shall not terminate the coverage of an enrollee under a group contract or group policy because the enrollee moves out of the approved service area, provided the enrollee continues to be an eligible enrollee of the insured group and agrees in writing to return to the approved service area for covered medical care.
(6) The HMO shall not terminate the coverage of an enrollee under an individual contract because the enrollee moves out of the approved service area, provided the enrollee agrees in writing to return to the approved service area for covered medical care.

Rule 120-2-33-.07 Financial and Statistical Reporting

(1) Each HMO shall annually, on or before the first day of March, file with the Commissioner, on Annual Statement Forms prescribed and adopted by Order of the Commissioner, an annual statement as of December 31st of the preceding year, certified by at least two principal officers, and a copy of said report shall also be delivered to the Commissioner of Human Resources, as required by O.C.G.A. Section 33-21-15.
(2) Quarterly financial reports on forms adopted by the NAIC shall be filed by each HMO not later than forty-five (45) days after the end of each calendar quarter.
(3) In addition to the requirements of the Act, each federally qualified HMO shall file with the Department copies of any financial or statistical reports required by the federal government.

Rule 120-2-33-.08 Rates and Forms

(1) Basic rates along with the method of computation of charges for enrollee coverage or any amendments thereto to be used in conjunction with any health benefits plan must be filed with and approved by the Commissioner prior to use.
(2) The Commissioner shall approve or disapprove any basic rate or method of computation of charges, or change thereto, as provided in O.C.G.A. Section 33-21-13.
(3) Such basic rates and methods of computation of charges shall be established in accordance with actuarial principles for various categories of enrollees, provided that charges applicable to an enrollee shall not be individually determined based on the status of health.
(4) Basic rates and charges shall not be excessive, inadequate, or unfairly discriminatory.
(5) A certification by a qualified actuary to the appropriateness of the basic rates, based on reasonable assumptions, shall accompany the filing, along with adequate supporting information. Supporting information shall include a detailed description, as applicable, but not necessarily limited to the following:
(a) projected and actual hospital utilization in days per thousand members per year;
(b) projected and actual hospital costs attributable to those hospitals specifically utilized by the HMO through contract or otherwise;
(c) projected and actual utilization of physician services, expressed in terms of numbers of visits per member per year;
(d) projected and actual costs of physician services, expressed in terms of cost per visit;
(e) projected and actual costs of emergency and out of area services of non-HMO providers, differentiated as to hospital and medical service components;
(f) identification, justification and derivation of any trend or protection factors; and
(g) identification and justification for any reserve or surplus contribution factor included within its charges.
(6) The HMO shall submit to the Commissioner every contract, policy, certificate or evidence of coverage, rider, endorsement, application or outline of coverage for approval prior to use in this State.
(7) Each form shall have the corporate name and address of the HMO as on file with the Commissioner. Any name or title of the policy shall be printed in a size of type smaller than that used for the name of the HMO. All material shall be printed in accordance with the standards set forth in O.C.G.A. Section 33-29-2.
(8) Each form shall be clearly worded with all limitations, exclusions and exceptions printed in the same size of type used to describe the benefits and grouped together under appropriate captions and bold face type.
(9) An enrollee under an individual contract may, if not satisfied for any reason, return the contract or other evidence of coverage within ten (10) days of receipt and receive a full refund of any payment made. This right may not be exercised if the enrollee utilizes the services of the HMO within the ten (10) day period unless the enrollee pays the reasonable cost of said services.
(10) Each group contract or group policy shall contain a provision that the policyholder is entitled to a grace period of not less than thirty-one (31) days for the payment of any premium due except the first, during which grace period the coverage shall continue in force, unless the policyholder shall have given the insurer notice of discontinuance thirty (30) days in advance of the date of discontinuance and in accordance with the terms of the policy. The policy may provide that the policyholder may be liable to the HMO for payment of a pro rate premium for the time the coverage was in force during such grace period.
(11) Individual contract or policies shall be subject to O.C.G.A. Section 33-29-3(b)(3).

Rule 120-2-33-.09 Complaint System

(1) Each HMO shall establish and maintain a complaint system to provide adequate and reasonable procedures for expeditious resolution of complaints made by enrollees concerning any matter related to any provision of such organization's health services, including, but not limited to, claims regarding the scope of coverage for health services, denials, cancellations, terminations or renewals of enrollee coverage, and the quality of health maintenance services rendered.
(2) The complaint system shall be organized in a manner that provides meaningful procedures for hearing and resolving complaints by enrollees. These procedures shall be fully set forth in group contracts, certificates and individual policies. The complaint system must be established and approved by the HMO's board of directors. Such complaint system shall include, but not be limited to:
(a) a definition of a legitimate complaint;
(b) details on how, when, where and with whom an enrollee is to file a complaint;
(c) appeals mechanisms and processes;
(d) the responsibilities of the various levels of the complaint system and the HMO staff;
(e) a written description of the process for timely review and disposition of all complaints; and
(f) a written policy about the reasonable time period for resolving complaints.
(3) These procedures shall also include any complaint submitted to the HMO by the Department or the Department of Human Resources as may be received by either Department from enrollees.
(4) If a complaint is made to the Department or the Department of Human Resources, such Department shall provide a copy of such complaint to the HMO concerned. The HMO shall provide a written response to such complaint within ten (10) working days to the complainant, with copies of such response to the Department and the Department of Human Resources.
(5) Pursuant to O.C.G.A. Section 33-21-9, each HMO shall submit for prior approval by the Commissioner and the Commissioner of Human Resources, and thereafter maintain, a system for the resolution of complaints. Such complaint procedures shall be filed in duplicate with the Department and the Department of Human Resources. In addition, each HMO shall:
(a) submit to the Commissioner and the Commissioner of Human Resources for prior approval any amendments or proposed changes to the system by which complaints may be filed and reviewed;
(b) maintain records of each complaint filed with the HMO for a period of five (5) years, such record to include, but not be limited to:
1. a copy of the complaint and the date of its filing;
2. the date and outcome of all consultations, hearings and hearing findings;
3. the date and decisions of any appeal proceedings;
4. the date and proceedings of any litigation; and
5. all letters, documents or evidence submitted regarding the complaint.
(6) The HMO shall also work with the medical group, individual practice association, or physicians under contract to promote the operation of peer review mechanisms internal to those provider groups.
(7) All enrollees who file written complaints shall first exhaust the complaint system available under the HMO. The complaint may then be investigated by the Commissioner or the Commissioner of Human Resources. The decision whether to investigate any complaint shall be at the discretion of the Commissioner or the Commissioner of Human Resources.

Rule 120-2-33-.10 Regulation of Agents

(1) An agent representing an HMO must comply with all of the requirements for a life, accident and sickness agent in O.C.G.A. Chapter 33-23 and have a current license and certificate of authority to represent the HMO.
(2) The HMO must comply with the provisions of O.C.G.A. Section 33-23-15 with regard to obtaining a certificate of authority for each agent representing the HMO as required in O.C.G.A. Section 33-23-15(a), filing a certified listing of agents whose certificates of authority are to be renewed along with the appropriate fees, and maintaining a list of authorized agents as required in O.C.G.A. Section 33-23-15(d).
(3) All HMO agents shall act in a fiduciary capacity in regard to monies collected or held by such agent.

Rule 120-2-33-.11 Conflict of Interest and Required Disclosure

Each applicant for a certificate of authority shall file with the application and shall immediately file any changes thereafter, a summary disclosure of any contractual or financial arrangements (or any future plans for contractual or financial arrangements) between the incorporators, all members of the governing body, the principal officers or any members of their immediate families, or any persons in which incorporators, members of the governing body, or principal officers, or any members of their immediate families, have any financial interest whatsoever in the HMO or a contracting provider of the HMO. The Commissioner may require such additional information as he may deem necessary to implement the Act or this Regulation.

Rule 120-2-33-.12 Department of Human Resources

The Act provides for the Regulation of HMOs by the Department of Insurance and the Department of Human Resources. While those areas of HMO operation dealing with health care delivery will be monitored by the Commissioner, the quality of care and certain complaints which fall within the expertise of the Department of Human Resources shall be regulated by the Commissioner of the Department of Human Resources in accordance with the provisions of the Act and the applicable Rules and Regulations.

Rule 120-2-33-.13 Notice of Modification in Operations

Pursuant to O.C.G.A. Section 33-21-2(c)(1), any modification in the operation of the HMO which is not otherwise specifically referenced within this Regulation shall be filed prior to the modification. Examples of such changes would include, but not necessarily be limited to, service area expansion, addition to or contraction in the number or size of health facilities operated, amendments or to provider contracts and loss of federal qualification.

Rule 120-2-33-.14 Severability

If any section, term or provision of these Rules and Regulations shall be adjudged invalid for any reason, such adjudgement shall not affect, impair or invalidate any other section, term or provision of these Rules and Regulations and the remaining sections, terms and provisions shall be and remain in full force.

Rule 120-2-33-.15 Penalties

(1) Violations of these Regulations by an HMO or an officer of the HMO shall be deemed grounds for the revocation of the HMO's certificate of authority as provided in O.C.G.A. Section 33-21-5, which shall be in addition to any other penalty provided by statute.
(2) Violations of these Regulations by any agent or representative of an HMO shall be grounds for the revocation of an agent's license or any other penalty provided by statute.

Rule 120-2-33-.16 Repealed

Rule 120-2-33-.17 Repealed

Rule 120-2-33-.18 Repealed