In this subtitle the following words have the meanings indicated. “Benefit package” means a set of health care services to be provided to a member of a health maintenance organization under a contract that entitles the member to the health care services, whether the services are provided: Directly by a health maintenance organization; or Through a contract or arrangement with another person. “Commissioner” means the State Insurance Commissioner. “Covered service” means a health care service included in the benefit package of the health maintenance organization and rendered to a member or subscriber of the health maintenance organization by: A provider under contract with the health maintenance organization, when the service is obtained in accordance with the terms of the benefit contract of the member or subscriber; or A noncontracting provider under § 19–710.1 of this subtitle, when the service is: Obtained in accordance with the terms of the benefit contract of the member or subscriber; Obtained pursuant to a verbal or written referral by: The health maintenance organization of the member or subscriber; or A provider under written contract with the health maintenance organization of the member or subscriber; or Preauthorized or otherwise approved either verbally or in writing by: The health maintenance organization of the member or subscriber; or A provider under written contract with the health maintenance organization of the member or subscriber. “Emergency medical condition” means a medical condition, including a mental health condition or substance use disorder, that manifests itself by acute symptoms of such severity, including severe pain, that the absence of immediate medical attention could reasonably be expected by a prudent layperson, who possesses an average knowledge of health and medicine, to result in a condition described in § 1867(e)(1) of the Social Security Act. “Emergency services” means, with respect to an emergency medical condition: A medical screening examination that is within the capability of the emergency department of a hospital or freestanding medical facility, including ancillary services routinely available to the emergency department to evaluate an emergency medical condition; Any other examination or treatment within the capabilities of the staff and facilities available at the hospital or freestanding medical facility that is necessary to stabilize the patient, regardless of the department of the hospital in which the examination or treatment is furnished; or Except as provided in paragraph (3) of this subsection, additional covered items and services furnished by a health care provider of emergency services that does not have a contractual relationship with the carrier after the patient is stabilized and as part of outpatient observation or an inpatient or outpatient stay with respect to the visit in which the services described in items (i) and (ii) of this paragraph are furnished. “Emergency services” includes services described in paragraph (1) of this subsection that are provided in specialized facilities that are staffed by behavioral health providers trained to provide crisis services. Subject to § 19–710(p) of this subtitle and § 14–205.2 of the Insurance Article, “emergency services” does not include items and services described in paragraph (1)(iii) of this subsection if all of the conditions in 45 C.F.R. § 149.410(b) are met. “Health care services” means services, medical equipment, and supplies that are provided by a provider. “Health care services” includes: Ambulance services; Appliances, drugs, medicines, and supplies; Chiropractic care and services; Convalescent institutional care; Dental care and services; Extended care; Family planning or infertility services; Health education services; Home health care or medical social services; Inpatient hospital services; Laboratory, radiological, or other diagnostic services; Medical care and services; Mental health services; Nursing care and services; Nursing home care; Optical care and services; Optometric care and services; Osteopathic care and services; Outpatient services; Pharmaceutical services; Physical therapy care and services; Podiatric care and services; Preventive medical services; Psychological care and services; Rehabilitative services; Surgical care and services; Treatment for alcoholism or drug abuse; and Any other care, service, or treatment of disease or injury, the correction of defects, or the maintenance of the physical and mental well–being of human beings. “Health maintenance organization” means any person, including a profit or nonprofit corporation organized under the laws of any state or country, that: Operates or proposes to operate in this State; Except as provided in § 19–703(b) and (e) of this subtitle, provides or otherwise makes available to its members health care services that include at least physician, hospitalization, laboratory, X–ray, emergency, and preventive services, out–of–area coverage, and any other health care services that the Commissioner determines to be available generally on an insured or prepaid basis in the area serviced by the health maintenance organization, and, at the option of the health maintenance organization, may provide additional coverage; Except for any copayment or deductible arrangement, is compensated only on a predetermined periodic rate basis for providing to members the minimum services that are specified in item (2) of this subsection; Assures its subscribers and members, the Commissioner, and the Department that one clearly specified legal and administrative focal point or element of the health maintenance organization has the responsibility of providing the availability, accessibility, quality, and effective use of comprehensive health care services; and Primarily provides services of physicians: Directly through physicians who are either employees or partners of the health maintenance organization; or Under arrangements with one or more groups of physicians, who are organized on a group practice or individual practice basis, under which each group: Is compensated for its services primarily on the basis of an aggregate fixed sum or on a per capita basis; and Is provided with an effective incentive to avoid unnecessary inpatient use, whether the individual physician members of the group are paid on a fee–for–service or other basis. “Member” means a person who makes a contract or on whose behalf a contract is made with a health maintenance organization for health care services. “Provider” means any person, including a physician or hospital, who is licensed or otherwise authorized in this State to provide health care services. “Subscriber” means a person who makes a contract with a health maintenance organization, either directly or through an insurer or marketing organization, under which the person or other designated persons are entitled to the health care services.

In adopting this subtitle, the General Assembly intends to: Provide alternative methods for the delivery of health care services to residents of this State, with a view toward achieving greater efficiency and economy in providing these services; Encourage the formation of health maintenance organizations that provide health care services to subscribers or groups of subscribers who contract for these services under a system of prepayments; and Encourage the formation of health maintenance organizations by such diverse groups as: Nonprofit health service plans; Medical health service plans; Medical care foundations; Groups of professionals, either in the form of partnerships or professional corporations; Consumer sponsored organizations; or Business or legal entities. To carry out the intent of subsection (a) of this section, the policy of this State is to: Provide one overall State law that: Regulates health maintenance organizations; Allows flexibility for the many forms these health maintenance organizations may take; and Facilitates public understanding and uniform administration of the rules and regulations that are adopted under this subtitle; Eliminate legal barriers to the organization, promotion, and expansion of health maintenance organizations; Provide for regulation of: The quality of health care, by the Department and by professional standards review organizations where appropriate; and All other matters covered under this subtitle, by the Commissioner; and Exempt health maintenance organizations from the insurance laws of this State, except as set forth in this subtitle.

This subtitle does not: Authorize any person to engage directly or indirectly in the practice of any health occupation except as otherwise authorized by law; Authorize any person to regulate, interfere, or intervene in the relationship between any provider of health care services and the patients of the provider; or Prohibit any health maintenance organization from meeting the requirements of any federal law that authorizes the health maintenance organization to: Receive federal financial assistance; or Enroll beneficiaries assisted by federal funds. A health maintenance organization or a part of it that is also a community health center organized under the federal Public Health Service Act and receives federal funds under 42 U.S.C. § 254c is not required to provide hospitalization for individuals for whom services are provided by those funds. Health maintenance organizations shall offer as an option to all of their members or subscribers benefits for hospice services provided by a hospice care program, as defined in § 19–901(c) of this title. Health maintenance organizations shall provide continuation coverage required under §§ 15–407 through 15–409 of the Insurance Article. Notwithstanding any other provision of this subtitle, a health maintenance organization may provide a limited set of health benefits if the limited set of health benefits is for subscribers or members who are enrolled in a county program to provide health care services for low–income individuals. In addition to the requirements of § 15–10B–09 of the Insurance Article, whenever a mother is required to remain hospitalized after childbirth for medical reasons and the mother requests that the newborn remain in the hospital, a health maintenance organization shall provide as part of its hospitalization services provided to members and subscribers payment for the cost of additional hospitalization for the newborn for up to 4 days. The attending physician or certified nurse midwife of the mother, or the designee of the attending physician or certified nurse midwife, shall provide notice to the mother of the provisions of paragraph (1) of this subsection.

A health maintenance organization may operate as authorized by this subtitle notwithstanding any prohibition against the corporate practice of medicine.

The Secretary may adopt rules, regulations, and standards for the quality of health care services provided by a health maintenance organization through its benefit packages. With the advice of the Department, the Commissioner shall adopt reasonable rules and regulations as necessary to carry out any other provisions of this subtitle. The Commissioner and the Department shall adopt joint internal procedures to help them work together to carry out their duties under this subtitle. The joint internal procedures shall establish means by which the Commissioner and the Department may inform each other promptly on matters that affect any health maintenance organization, including: Any important action, change, or rearrangement that a health maintenance organization may undertake; and Any regulatory problem.

The Secretary shall adopt regulations that set out reasonable standards of quality of care that a health maintenance organization shall provide to its members. The standards of quality of care shall include: A requirement that a health maintenance organization shall provide for regular hours during which a member may receive services, including providing for services to a member in a timely manner that takes into account the immediacy of need for services; A requirement that a health maintenance organization shall have a system for providing a member with 24–hour access to a physician in cases where there is an immediate need for medical services, and for promoting timely access to and continuity of health care services for members, including: Providing 24–hour access by telephone to a person who is able to appropriately respond to calls from members and providers concerning after–hours care; and Providing a 24–hour toll free telephone access system for use in hospital emergency departments in accordance with § 19–705.7 of this subtitle; A requirement that any nonparticipating provider shall submit to the health maintenance organization the appropriate documentation of the medical complaint of the member and the services rendered; A requirement that a health maintenance organization shall have a physician available at all times to provide diagnostic and treatment services; A requirement that a health maintenance organization shall ensure that: Each member who is seen for a medical complaint is evaluated under the direction of a physician; and Each member who receives diagnostic evaluation or treatment is under the medical management of a health maintenance organization physician who provides continuing medical management; A requirement that each member shall have an opportunity to select a primary physician, a physician assistant, a certified nurse–midwife, a licensed certified midwife, or a certified nurse practitioner from among those available to the health maintenance organization; and A requirement that a health maintenance organization print, in any directory of participating providers or hospitals, in a conspicuous manner, the address, telephone number, and facsimile number of the State agency that members, enrollees, and insureds may call to discuss quality of care issues, life and health insurance complaints, and assistance in resolving billing and payment disputes with the health plan or health care provider, as follows: For quality of care issues and life and health care insurance complaints, the Maryland Insurance Administration; and For assistance in resolving a billing or payment dispute with the health plan or a health care provider, the Health Education and Advocacy Unit of the Consumer Protection Division of the Office of the Attorney General. This subsection may not be construed to require that a health maintenance organization include certified nurse practitioners on the health maintenance organization’s provider panel as primary care providers. The health maintenance organization shall make available and encourage appropriate history and baseline examinations for each member within a reasonable time of enrollment set by it. Medical problems that are a potential hazard to the person’s health shall be identified and a course of action to alleviate these problems outlined. Progress notes indicating success or failure of the course of action shall be recorded. The health maintenance organization shall: Offer or arrange for preventive services that include health education and counseling, early disease detection, immunization, and hearing loss screening of newborns provided by a hospital before discharge; Develop or arrange for periodic health education on subjects which impact on the health status of a member population; and Notify every member in writing of the availability of these and other preventive services. The health maintenance organization shall offer services to prevent a disease if: The disease produces death or disability and exists in the member population; The etiology of the disease is known or the disease can be detected at an early stage; and Any elimination of factors leading to the disease or immunization has been proven to prevent its occurrence, or early disease detection followed by behavior modification, environmental modification, or medical intervention has been proven to prevent death or disability. To implement these standards of quality of care, a health maintenance organization shall have a written plan that is updated and reviewed at least every 3 years. The plan shall include the following information: Statistics on age, sex, and other general demographic data used to determine the health care needs of its population; Identification of the major health problems in the member population; Identification of any special groups of members that have unique health problems, such as the poor, the elderly, the mentally ill, and educationally disadvantaged; and A description of community health resources and how they will be used. The health maintenance organization shall state its priorities and objectives in writing, describing how the priorities and objectives relating to the health problems and needs of the member population will be provided for. The health maintenance organization shall provide at the time membership is solicited a general description of the benefits and services available to its members, including benefit limitations and exclusions, location of facilities or providers, and procedures to obtain medical services. The health maintenance organization shall place the following statement, in bold print, on every enrollment card or application: “If you have any questions concerning the benefits and services that are provided by or excluded under this agreement, please contact a membership services representative before signing this application or card”. The plan shall contain evidence that: The programs and services offered are based on the health problems of and the community health services available to its member population; There is an active program for preventing illness, disability, and hospitalization among its members; and The services designed to prevent the major health problems identified among child and adult members and to improve their general health are provided by the health maintenance organization. The health maintenance organization shall have an internal peer review system that will evaluate the utilizational services and the quality of health care provided to its members. The review system shall: Provide for review by appropriate health professionals of the process followed in the provision of health services; Use systematic data collection of performances and patient results; Provide interpretation of this data to the practitioners; Review and update continuing education programs for health professionals providing services to its members; Identify needed change and proposed modifications to implement the change; and Maintain written records of the internal peer review process. Except as provided in paragraph (5) of this subsection, the Department shall conduct an annual external review of the quality of the health services of the health maintenance organization in a manner that the Department considers to be appropriate. The external review shall be conducted by: A panel of physicians and other health professionals that consists of persons who: Have been approved by the Department; Have substantial experience in the delivery of health care in a health maintenance organization setting, but who are not members of the health maintenance organization staff or performing professional services for the health maintenance organization; and Reside outside the area serviced by the health maintenance organization; or The Department. The final decision on the type of external review that is to be employed rests solely with the Secretary. The external review shall consist of a review and evaluation of: An internal peer review system and reports; The program plan of the health maintenance organization to determine if it is adequate and being followed; The professional standards and practices of the health maintenance organization in every area of services provided; The grievances relating specifically to the delivery of medical care, including their final disposition; The physical facilities and equipment; and A statistically representative sample of member records. A health maintenance organization accredited by an accreditation organization approved by the Secretary in accordance with § 19–2302 of this title shall be exempt from the external review.

With the advice of the Secretary, the Commissioner shall adopt regulations to establish a system for the receipt and timely investigation of complaints of members and subscribers of health maintenance organizations concerning the operation of any health maintenance organization in this State. The complaint system shall include: A procedure for the timely acknowledgment of receipt of a complaint; Criteria that the Secretary shall adopt by regulation for determining the appropriate level of investigation for a complaint concerning quality of care, including: A determination as to whether the member or subscriber with the complaint previously attempted to have the complaint resolved; and A determination as to whether a complaint should be sent to the member’s or subscriber’s health maintenance organization for resolution prior to investigation under the provisions of this section; and A procedure for the referral of quality of care complaints to the Secretary for an appropriate investigation. If a determination is made to investigate a complaint under the provisions of this section prior to the member or subscriber attempting to otherwise resolve the complaint, the reasons for that determination shall be documented. Notice of the complaint system established under the provisions of this section shall be included in all contracts between a health maintenance organization and a member or subscriber of a health maintenance organization. For quality of care complaints referred to the Secretary for investigation under subsection (b)(3) of this section, the Secretary shall report to the Commissioner in a timely manner on the results and findings of each investigation.

In this section, “health maintenance organization” means a health maintenance organization where health care services are delivered by health care providers to subscribers at a central facility or centralized system of facilities operated by the health maintenance organization. The Department shall adopt regulations to require health maintenance organizations to: Adopt, implement, and enforce a policy that requires, except in an emergency life–threatening situation where it is not feasible or practicable, all employees and medical staff involved in patient care services to comply with the Centers for Disease Control and Prevention’s guidelines on universal precautions; and Display the notice developed under § 1–207 of the Health Occupations Article at the entrance to the health maintenance organization. If the health maintenance organization fails to comply with the requirements of this section the Secretary may impose a penalty of up to $500 per day per violation for each day a violation continues.

Any limitation imposed by a health maintenance organization on the receipt of covered services provided to a member or subscriber by a physical therapist licensed under Title 13 of the Health Occupations Article may only be imposed per incident or per injury within a contract period. This subsection may not be construed to prohibit a health maintenance organization from imposing any limitations on the number of visits permitted for a member or subscriber.

In this section the following words have the meanings indicated. “Inherited metabolic disease” means a disease caused by an inherited abnormality of body chemistry. “Inherited metabolic disease” includes a disease for which the State screens newborn babies. “Low protein modified food product” means a food product that is: Specially formulated to have less than 1 gram of protein per serving; and Intended to be used under the direction of a physician for the dietary treatment of an inherited metabolic disease. “Low protein modified food product” does not include a natural food that is naturally low in protein. “Medical food” means a food that is: Intended for the dietary treatment of a disease or condition for which nutritional requirements are established by medical evaluation; and Formulated to be consumed or administered enterally under the direction of a physician. A health maintenance organization shall include as part of its benefit package of health care services to be provided to members and subscribers coverage for medical foods and low protein modified food products for the treatment of inherited metabolic diseases if the medical foods and low protein modified food products are: Prescribed as medically necessary for the therapeutic treatment of inherited metabolic diseases; and Administered under the direction of a physician.

If it is necessary to provide emergency services, authorization shall be presumed for utilizing the medical or surgical provider on call for unassigned patients or the appropriate specialist on call for the hospital on that date if: A telephone access system is not operational at the time of the call; or A member’s primary care provider or the specialist needed by a member cannot be determined within a reasonable time, as determined by the treating emergency physician but not to exceed 30 minutes after the initial documented call to the telephone access system. This section may not be construed to require a health maintenance organization to have contracted specialist providers at hospitals outside of the service area of the health maintenance organization.

The 24-hour toll free telephone access system provided by each health maintenance organization shall: Enable members and providers to determine, with one telephone call, the primary care provider assigned to a member; and Enable providers to determine, with one telephone call, the names of three contracted specialist providers for the health maintenance organization who also have staff privileges at a particular hospital in the State.

In this section the following words have the meanings indicated. “HMO Quality Assurance Unit” means the Health Maintenance Organization (HMO) Quality Assurance Unit in the Department. “Quality Assurance Medical Director” means the Medical Director of the HMO Quality Assurance Unit. There is a Health Maintenance Organization (HMO) Quality Assurance Unit in the Department. The Secretary shall appoint the Quality Assurance Medical Director. The Quality Assurance Medical Director shall: Be a physician who is licensed in the State; Be board certified in at least one specialty; Have experience in primary care and administrative medicine; and Have broad knowledge of health maintenance organizations and managed care organizations. The Quality Assurance Medical Director is entitled to the compensation provided in the State budget. Subject to the authority vested in the Secretary by law, the Quality Assurance Medical Director is in charge of and responsible for the clinical operations of the HMO Quality Assurance Unit. In accordance with the State budget the Secretary may employ staff for the HMO Quality Assurance Unit. The HMO Quality Assurance Unit shall: Enforce all requirements established under §§ 19-705 and 19-705.1 of this subtitle and the regulations adopted under these provisions regarding the quality of health care provided by a health maintenance organization; and Investigate quality of care complaints referred to the Secretary under § 19-705.2(b)(3) of this subtitle. The Quality Assurance Medical Director shall: Determine whether a health maintenance organization meets the requirements established under §§ 19-705 and 19-705.1 of this subtitle and the regulations adopted under these provisions regarding the quality of health care provided by a health maintenance organization; and Make recommendations to the Secretary for corrective action necessary to meet these requirements. If the Secretary agrees with a determination made by the Quality Assurance Medical Director that a health maintenance organization does not meet the requirements established under §§ 19-705 and 19-705.1 of this subtitle or the regulations adopted under these provisions regarding the quality of health care provided by a health maintenance organization, the Secretary may issue an order under § 19-731 of this subtitle.

Each health maintenance organization that is issued a certificate of authority by the Commissioner shall be regulated under this subtitle. Any health maintenance organization that is regulated by Title 14, Subtitle 1 of the Insurance Article is subject also to this subtitle. This subsection applies to a corporation described in Title 14, Subtitle 1 of the Insurance Article, but only if it is a health maintenance organization. Except as otherwise provided in this subtitle or expressly provided in the Insurance Article, a health maintenance organization is not subject to the insurance laws of this State. Only the Commissioner may issue, suspend, or revoke a certificate of authority of a health maintenance organization. The provisions of Title 27, Subtitle 8 of the Insurance Article shall apply to health maintenance organizations. The provisions of Title 15, Subtitle 10B of the Insurance Article shall apply to health maintenance organizations. The provisions of Title 6.5 of the State Government Article shall apply to the acquisition of a health maintenance organization owned by a nonprofit entity. The provisions of § 27–210 of the Insurance Article apply to health maintenance organizations. The provisions of § 15–145 of this article apply to health maintenance organizations. The provisions of Title 15, Subtitle 16 of the Insurance Article apply to health maintenance organizations. The provisions of § 2–517 of the State Personnel and Pensions Article apply to health maintenance organizations. The provisions of § 15–134 of the Insurance Article apply to health maintenance organizations. The provisions of Title 4, Subtitle 5 of the Insurance Article apply to health maintenance organizations. The provisions of Title 9, Subtitle 4 of the Insurance Article apply to health maintenance organizations. The provisions of Title 33 of the Insurance Article apply to health maintenance organizations. The provisions of § 12–211 of the Insurance Article apply to health maintenance organizations.

Subject to this section, the provisions of Title 9, Subtitle 2 of the Insurance Article regarding the rehabilitation and liquidation of insurers are applicable to health maintenance organizations. Subject to paragraph (2) of this subsection, any rehabilitation or liquidation of a health maintenance organization shall be deemed to be the rehabilitation or liquidation of an insurer and shall be conducted under the supervision of the Commissioner under the law governing the rehabilitation or liquidation of insurers. The provisions of §§ 9-224 and 9-225 of the Insurance Article do not apply to the rehabilitation or liquidation of a health maintenance organization. The Commissioner may apply for an order directing the Commissioner to rehabilitate or liquidate a health maintenance organization: Upon any one or more grounds set out in Title 9, Subtitle 2 of the Insurance Article; or When in the Commissioner’s opinion the continued operation of the health maintenance organization would be hazardous either to its members or to the people of this State. In addition to the Commissioner’s authority under Title 9, Subtitle 2 of the Insurance Article, the Commissioner as a rehabilitator of a health maintenance organization may, subject to approval by a court: Change premium rates and other terms of an individual or group contract; Terminate or change the terms of: Provider contracts; or Contracts with participating entities for the provision of administrative, financial, or management services; and Negotiate and, if the assuming health maintenance organization agrees: Transfer the coverage obligations of the impaired health maintenance organization to an assuming health maintenance organization; and Assign the provider contracts of the impaired health maintenance organization to an assuming health maintenance organization. Before taking any action under paragraph (1)(ii) of this subsection, the Commissioner shall consider: The interests of providers and other participating entities under contract with the impaired health maintenance organizations; and The viability of continuing the health plan. If a court under paragraph (1)(ii) of this subsection approves a change to the terms of a contract that diminishes the compensation of a provider or a participating entity providing administrative, financial, or management services, the change may not: Be effective for more than 60 days; and Except by mutual consent, be renewed or extended. In addition to the Commissioner’s authority under Title 9, Subtitle 2 of the Insurance Article, the Commissioner as a liquidator may, subject to approval by a court: Contract with a solvent health maintenance organization or other appropriate entity to operate the insolvent health maintenance organization, including the provision of medical care, on a short-term basis; Operate the insolvent health maintenance organization, which may include compensating health care providers in accordance with the terms of the health care provider’s contract with the insolvent health maintenance organization; Direct all other health maintenance organizations that participated in an open enrollment process with the insolvent health maintenance organization at a group’s last regular open enrollment period to offer enrollees or subscribers of the insolvent health maintenance organization a 30-day open enrollment period to begin on the date of the insolvency; and Require each health maintenance organization directed to offer enrollees or subscribers of the insolvent health maintenance organization a 30-day open enrollment period to offer the enrollees of the insolvent health maintenance organization the same coverage and rates that it offered the enrollees at the last regular open enrollment period; Equitably allocate the insolvent health maintenance organization’s group contracts of those groups not offered other coverage under item (3) of this subsection, among all health maintenance organizations operating within a portion of the insolvent health maintenance organization’s service area, except that before allocating the group contracts under this item, the Commissioner shall consider the health care delivery system and financial resources of all possible successor health maintenance organizations; Require each health maintenance organization allocated a group or groups under item (i) of this item to offer the group or groups the health maintenance organization’s existing coverage which is most similar to each group’s coverage with the insolvent health maintenance organization at rates determined in accordance with the successor health maintenance organization’s existing rate methodology; and Ensure that any enrollee or subscriber whose group coverage had terminated prior to the date of the insolvency and who converted their group coverage into individual conversion coverage is offered the same conversion coverage that is offered by the successor health maintenance organization to persons converting from the group of which the enrollee or subscriber had been a former member; Equitably allocate the insolvent health maintenance organization’s nongroup individual contracts of those nongroup individuals not offered other coverage under item (3) of this subsection, among all health maintenance organizations operating within a portion of the insolvent health maintenance organization’s service area, except that before allocating the nongroup individual contract or contracts under this item, the Commissioner shall consider the health care delivery system and financial resources of all possible successor health maintenance organizations; and Require each health maintenance organization allocated a nongroup individual or individuals under item (i) of this item to offer the nongroup individual or individuals the health maintenance organization’s existing coverage which is most similar to the nongroup individual’s coverage with the insolvent health maintenance organization at rates determined in accordance with the successor health maintenance organization’s existing rate methodology; and Take any other action deemed necessary by the Commissioner. The claims and expenses of health care providers incurred by the Commissioner, as a receiver, in continuing plan benefits as provided in the insolvent health maintenance organization’s plan of insolvency adopted under § 19-710(q) of this subtitle shall: Be considered expenses for the administration of the receivership; and Have priority over all other expenses. In the event of the liquidation or rehabilitation of a health maintenance organization under this section: Members of the health maintenance organization shall have the same priority of claims as provided in § 9-227(c) of the Insurance Article; and For claims for health care services rendered to members before an order of receivership has been entered, the following health care providers shall immediately follow in priority claims of the members of the health maintenance organization: Health care providers under contract with the health maintenance organization; Health care providers that rendered health care services to members of the health maintenance organization upon referral from a health care provider under contract with the health maintenance organization; and A hospital. A health care provider may not assert a claim of subrogation against: A member of an insolvent health maintenance organization; or Any individual, organization, or government agency which has made payments to the health maintenance organization on behalf of a member. Notwithstanding paragraph (1) of this subsection, a health care provider may assert any claim it may have against the receiver of the insolvent health maintenance organization.

A health maintenance organization shall obtain from the Commissioner a certificate of authority to operate as a health maintenance organization before it may issue any contract or certificate to a member, provide any health care services to a member, or otherwise operate in this State. Except as permitted by the Commissioner and subject to the rules and regulations adopted under this subtitle, a health maintenance organization that does not have a certificate of authority may not contact potential members to discuss the health care services the health maintenance organization proposes to offer if a certificate of authority is granted.

An applicant for a certificate to operate as a health maintenance organization shall submit an application to the Commissioner on the form that the Commissioner requires. The application shall include or be accompanied by: A copy of the basic health maintenance organizational document and any amendments to it that, where applicable, are certified by the Department of Assessments and Taxation; A copy of the bylaws of the health maintenance organization, if any, that are certified by the appropriate officer; A list of the individuals who are to be responsible for the conduct of the affairs of the health maintenance organization, including all members of the governing body, the officers and directors if it is a corporation, and the partners or associates if it is a partnership or association; The addresses of those individuals and their official capacity with the health maintenance organization; A statement by each individual referred to in item (3) of this subsection that fully discloses the extent and nature of any contract or arrangement between the individual and the health maintenance organization and any possible conflict of interest; A resume of the qualifications of: The administrator; The medical director, who shall be a physician licensed in this State and certified under Title 15, Subtitle 10C of the Insurance Article; The enrollment director; and Any other individual who is associated with the health maintenance organization that the Commissioner and the Secretary request under their joint internal procedures; A statement that describes generally: The health maintenance organization, including: Its operations; Its enrollment process; Its quality assurance mechanism; and Its internal grievance procedures; The methods the health maintenance organization proposes to use to offer its members and public representatives an opportunity to participate in matters of policy and operation; The location of the facilities where health care services will be available regularly to members; The type and specialty of physicians and health care personnel who are engaged to provide health care services; The number of physicians and personnel in each category; and The health and medical records system to provide documentation of use by members; The form of each contract that the health maintenance organization proposes to offer to subscribers showing the benefits to which they are entitled and a table of the rates charged or proposed to be charged for each form of contract; A statement that describes with reasonable certainty each geographic area to be served by the health maintenance organization; A statement of the financial condition of the health maintenance organization, including: Sources of financial support; A balance sheet showing assets, liabilities, and minimum tangible net worth; and Any other financial information the Commissioner requires for adequate financial evaluation; Copies of any proposed advertising and proposed techniques and methods of selling the services of the health maintenance organization; A power of attorney that is executed by the health maintenance organization appointing the Commissioner as agent of the organization in this State to accept service of process in any action, proceeding, or cause of action arising in this State against the health maintenance organization; and Copies of the agreements proposed to be made between the health maintenance organizations and providers of health care services.

When a health maintenance organization files its initial application for a certificate of authority to operate, it shall pay to the Commissioner a fee of $300. In addition to the fee required under subsection (a) of this section, each health maintenance organization shall pay a reasonable sum that the Commissioner finds to be the cost of the investigations made by the Commissioner and the Department as required under this subtitle.

To qualify for a certificate of authority to operate as a health maintenance organization, an applicant shall satisfy the Commissioner that the applicant will meet the requirements of this section. The applicant shall conform to the definition of a health maintenance organization. The applicant shall establish and operate a bona fide health maintenance organization that can provide health care services in the proposed geographic area. The health maintenance organization shall be actuarially sound. Except as otherwise provided in this paragraph, the surplus that the health maintenance organization is required to have shall be paid in full. The health maintenance organization licensed on or after July 1, 1989 shall have an initial surplus that exceeds the liabilities of the health maintenance organization by at least $1,500,000. All health maintenance organizations shall maintain a surplus that exceeds the liabilities of the health maintenance organization in the amount that is at least equal to the greater of $750,000 or 5 percent of the subscription charges earned during the prior calendar year as recorded in the annual report filed by the health maintenance organization with the Commissioner. No health maintenance organization shall be required to maintain a surplus in excess of a value of $3,000,000. For the protection of the health maintenance organization’s members and creditors, the applicant shall deposit and maintain in trust with the State Treasurer $100,000 in cash or government securities of the type described in § 5–701(b) of the Insurance Article. The deposits shall be accepted and held in trust by the State Treasurer in accordance with Title 5, Subtitle 7 of the Insurance Article. For the purpose of applying this subparagraph, a health maintenance organization shall be treated as an insurer. The Commissioner may waive the surplus and deposit requirements contained in this subsection if the Commissioner is satisfied that: The health maintenance organization has sufficient net worth and an adequate history of generating net income to assure financial viability for the next year; The health maintenance organization’s performance and obligations are guaranteed by another person with sufficient net worth and an adequate history of generating net income; or The assets of the health maintenance organization or contracts with insurers, governments, providers, or other persons are sufficient to reasonably assure the performance of the health maintenance organization’s obligations. The provisions of Title 4, Subtitle 3 (Risk Based Capital Standards for Insurers) and § 15–604 (Rates for Payments to Hospitals) of the Insurance Article apply to health maintenance organizations in the same manner as they apply to insurers. The terms of contracts, including any medical assistance program contracts under Title XVIII or Title XIX of the Social Security Act or Title III of the Public Health Service Act, proposed to be made or made with government or private agencies that cover all or part of the cost of subscriptions to provide health care services, facilities, appliances, medicines, or supplies shall be financially sound, based on reasonable actuarial assumptions that the health maintenance organization can meet its obligations to the agencies and their beneficiaries by reason of the health maintenance organization’s net worth position, stop loss, reinsurance arrangements with authorized insurers, or other arrangements that are satisfactory to the Commissioner. The terms of the contracts to be offered to subscribers shall provide that the health care services provided to members of the health maintenance organization will meet reasonable standards of quality of care that are applicable to the geographic area to be served, as approved by the Department. If a health maintenance organization offers services that are within the scope of practice of a physician and another health care practitioner who is licensed under the Health Occupations Article, the health maintenance organization shall offer those services through other licensed health care practitioners, where appropriate, as determined by the health maintenance organization. The procedures for offering health care services and offering and terminating contracts to subscribers may not discriminate unfairly on the basis of age, sex, sexual orientation, gender identity, religious beliefs, disability, race, health, or economic status. The requirement under paragraph (1) of this subsection does not prohibit: Reasonable underwriting classifications for establishing contract rates; or Experience rating. The terms of the agreements between a health maintenance organization and providers of health services shall contain a “hold harmless” clause. The hold harmless clause shall provide that the provider may not, under any circumstances, including nonpayment of money due the providers by the health maintenance organization, insolvency of the health maintenance organization, or breach of the provider contract, bill, charge, collect a deposit, seek compensation, remuneration, or reimbursement from, or have any recourse against the subscriber, member, enrollee, patient, or any persons other than the health maintenance organization acting on their behalf, for services provided in accordance with the provider contract. Collection from the subscriber or member of copayments or supplemental charges in accordance with the terms of the subscriber’s contract with the health maintenance organization, or charges for services not covered under the subscriber’s contract, may be excluded from the hold harmless clause. Each provider contract shall state that the hold harmless clause will survive the termination of the provider contract, regardless of the cause of termination. The health maintenance organization shall provide evidence of adequate insurance coverage or an adequate plan for self–insurance to satisfy claims for injuries that may occur from providing health care. The health maintenance organization shall provide for having its health and medical facilities and services audited and reviewed periodically: By personnel outside the health maintenance organization who: Act in a manner that is approved by the Department; and Use methods that will assure objective evaluation and keep the identity of patients as confidential as possible; By the health maintenance organization’s own internal quality of care committee audit procedures, if the Department approves the procedures; or By a professional standards review organization, as described in Title XI of the Social Security Act, that is certified by the Department of Health and Human Services as capable of serving individuals in the area where the health maintenance organization operates who are receiving benefits under Title XVIII or Title XIX of the Social Security Act or Title III of the Public Health Service Act, if the professional standards review organization is acting consistently with its certification. With the approval of the Department, the health maintenance organization shall provide continuous internal peer review for monitoring and evaluating patient records for: Quality of care; and Overuse and underuse of provider care; and The health maintenance organization shall meet the requirements of Subtitle 13 of this title and all regulations for the performance of utilization review. The health maintenance organization shall provide an internal grievance system to resolve adequately any grievances initiated by any of its members, in a manner approved by the Department on matters concerning quality of care and by the Commissioner on all other matters covered by this subtitle, under rules and regulations adopted under this subtitle. The health maintenance organization shall establish procedures to offer each member an opportunity to participate in matters of policy and operation. The health maintenance organization shall maintain a health and medical records system that: Under procedures assuring maximum confidentiality, is readily accessible to authorized persons; Can accurately document use by each member; and At a minimum: Identifies clearly each patient by: Name; Number; Age; and Sex; and Shows clearly: The services provided; When the services are provided; Where the services are provided; By whom the services are provided; The diagnosis and prognosis, if appropriate; The treatment; Any drug therapy; and The health status of the patient, if appropriate. Except as provided in paragraph (3) of this subsection, individual enrollees and subscribers of health maintenance organizations issued certificates of authority to operate in this State may not be liable to any health care provider for any covered services provided to the enrollee or subscriber. A health care provider or any representative of a health care provider may not collect or attempt to collect from any subscriber or enrollee any money owed to the health care provider by a health maintenance organization issued a certificate of authority to operate in this State. A health care provider or any representative of a health care provider may not maintain any action against any subscriber or enrollee to collect or attempt to collect any money owed to the health care provider by a health maintenance organization issued a certificate of authority to operate in this State. Notwithstanding any other provision of this subsection, a health care provider or representative of a health care provider may collect or attempt to collect from a subscriber or enrollee: Any copayment or coinsurance sums owed by the subscriber or enrollee to a health maintenance organization issued a certificate of authority to operate in this State for covered services provided by the health care provider; If Medicare is the primary insurer and a health maintenance organization is the secondary insurer, any amount up to the Medicare approved or limiting amount, as specified under the Social Security Act, that is not owed to the health care provider by Medicare or the health maintenance organization after coordination of benefits has been completed, for Medicare covered services provided to the subscriber or enrollee by the health care provider; or Any payment or charges for services that are not covered services. The Commissioner shall require each health maintenance organization to have an insolvency plan by January 1, 1990 which provides for: Continuation of benefits to subscribers and enrollees for the duration of the contract period for which premiums have been paid; and Continuation of benefits to subscribers or enrollees who are admitted to an inpatient health care facility on the date of insolvency until, the earlier of: The subscriber or enrollee is discharged from the inpatient health care facility; or 365 days. In determining the adequacy of any insolvency plan, the Commissioner may consider: The existence of insurance to cover expenses incurred in continuing benefits after an insolvency; Provisions in provider contracts obligating providers to continue to provide services to enrollees or subscribers: For the duration of the contract period for which premiums have been made; and If admitted to an inpatient health care facility, until the enrollee or subscriber is discharged or 365 days, whichever occurs first; Reserves; Letters of credit; Guarantees; or Any other arrangement to assure that benefits are continued in accordance with the provisions of paragraph (1) of this subsection. Repealed. In this subsection, “practice profile” means a profile, summary, economic analysis, or other analysis of data concerning services rendered or utilized by a provider under contract with or employed by a health maintenance organization for the provision of health care services by the provider to enrollees or subscribers of the health maintenance organization. If a health maintenance organization uses a practice profile as a factor in its contract review to evaluate a provider’s status on a provider panel, the health maintenance organization shall disclose at the commencement and renewal of the contract and, not more often than annually, upon the request of the provider: A description of the criteria used to compile the practice profile concerning the provider; and The manner in which the practice profile is used to evaluate the provider. The information provided under this subsection may not be used to create a cause of action. A health maintenance organization may not terminate a provider contract or provider’s employment with the health maintenance organization on the basis of a practice profile without first informing the provider of the findings of the practice profile and the provider specific data underlying those findings. A health maintenance organization may not by contract, or in any other manner, require a provider to indemnify the health maintenance organization or hold the health maintenance organization harmless from a coverage decision or negligent act of the health maintenance organization.

In this section the following words have the meanings indicated. “Adjunct claims documentation” means an abstract of an enrollee’s medical record which describes and summarizes the diagnosis and treatment of, and services rendered to, the enrollee, including, in the case of trauma rendered in a trauma center, an operative report, a discharge summary, a Maryland Ambulance Information Systems form, or a medical record. “Berenson–Eggers Type of Service Code” means a code in a classification system developed by the Centers for Medicare and Medicaid Services that groups Current Procedural Terminology codes together based on clinical consistency. “Enrollee” means a subscriber or member of a health maintenance organization. “Evaluation and management service” means any service with a Berenson–Eggers Type of Service Code in the category of evaluation and management. “Institute” means the Maryland Institute for Emergency Medical Services Systems. “Medicare Economic Index” means the fixed–weight input price index that: Measures the weighted average annual price change for various inputs needed to produce physician services; and Is used by the Centers for Medicare and Medicaid Services in the calculation of reimbursement of physician services under Title XVIII of the federal Social Security Act. “Similarly licensed provider” means: For a physician: A physician who is board certified or eligible in the same practice specialty; or A group physician practice that contains board certified or eligible physicians in the same practice specialty; For a health care provider that is not a physician, a health care provider that holds the same type of license. “Trauma center” means a primary adult resource center, level I trauma center, level II trauma center, level III trauma center, or pediatric trauma center that has been designated by the institute to provide care to trauma patients. “Trauma center” includes an out–of–state pediatric facility that has entered into an agreement with the institute to provide care to trauma patients. “Trauma patient” means a patient that is evaluated or treated in a trauma center and is entered into the State trauma registry as a trauma patient. “Trauma physician” means a licensed physician who has been credentialed or designated by a trauma center to provide care to a trauma patient at a trauma center. In addition to any other provisions of this subtitle, for a covered service rendered to an enrollee of a health maintenance organization by a health care provider not under written contract with the health maintenance organization, the health maintenance organization or its agent: Shall pay the health care provider within 30 days after the receipt of a claim in accordance with the applicable provisions of this subtitle; and Shall pay the claim submitted by: A hospital at the rate approved by the Health Services Cost Review Commission; A trauma physician for trauma care rendered to a trauma patient in a trauma center, at the greater of: 140% of the rate paid by the Medicare program, as published by the Centers for Medicare and Medicaid Services, for the same covered service, to a similarly licensed provider; or The rate as of January 1, 2001 that the health maintenance organization paid in the same geographic area, as published by the Centers for Medicare and Medicaid Services, for the same covered service, to a similarly licensed provider; and Any other health care provider: For an evaluation and management service, no less than the greater of: 125% of the average rate the health maintenance organization paid as of January 1 of the previous calendar year in the same geographic area, as defined by the Centers for Medicare and Medicaid Services, for the same covered service, to similarly licensed providers under written contract with the health maintenance organization; or 140% of the rate paid by Medicare, as published by the Centers for Medicare and Medicaid Services, for the same covered service to a similarly licensed provider in the same geographic area as of August 1, 2008, inflated by the change in the Medicare Economic Index from 2008 to the current year; and For a service that is not an evaluation and management service, no less than 125% of the average rate the health maintenance organization paid as of January 1 of the previous calendar year in the same geographic area, as defined by the Centers for Medicare and Medicaid Services, to a similarly licensed provider under written contract with the health maintenance organization for the same covered service. For the purposes of subsection (b)(2)(iii) of this section, a health maintenance organization shall calculate the average rate paid to similarly licensed providers under written contract with the health maintenance organization for the same covered service by summing the contracted rate for all occurrences of the Current Procedural Terminology Code for that service and then dividing by the total number of occurrences of the Current Procedural Terminology Code. A health maintenance organization shall disclose, on request of a health care provider not under written contract with the health maintenance organization, the reimbursement rate required under subsection (b)(2)(ii) and (iii) of this section. Subject to paragraph (2) of this subsection, a health maintenance organization may require a trauma physician not under contract with the health maintenance organization to submit appropriate adjunct claims documentation and to include on the uniform claim form a provider number assigned to the trauma physician by the health maintenance organization. If a health maintenance organization requires a trauma physician to include a provider number on the uniform claim form in accordance with paragraph (1) of this subsection, the health maintenance organization shall assign a provider number to a trauma physician not under contract with the health maintenance organization at the request of the physician. A trauma center, on request from a health maintenance organization, shall verify that a licensed physician is credentialed or otherwise designated by the trauma center to provide trauma care. Notwithstanding the provisions of § 19–701(d) of this subtitle, for trauma care rendered to a trauma patient in a trauma center by a trauma physician, a health maintenance organization may not require a referral or preauthorization for a service to be covered. A health maintenance organization may seek reimbursement from an enrollee for any payment under subsection (b) of this section for a claim or portion of a claim submitted by a health care provider and paid by the health maintenance organization that the health maintenance organization determines is the responsibility of the enrollee. The health maintenance organization may request and the health care provider shall provide adjunct claims documentation to assist in making the determination under paragraph (1) of this subsection or under subsection (b) of this section. A health care provider may enforce the provisions of this section by filing a complaint against a health maintenance organization with the Maryland Insurance Administration or by filing a civil action in a court of competent jurisdiction under § 1–501 or § 4–201 of the Courts Article. The Maryland Insurance Administration or a court shall award reasonable attorney fees if the complaint of the health care provider is sustained. The Maryland Health Care Commission annually shall review payments to health care providers to determine the compliance of health maintenance organizations with the requirements of this section and report its findings to the Maryland Insurance Administration. The Maryland Insurance Administration may take any action authorized under this subtitle or the Insurance Article, including conducting an examination under Title 2, Subtitle 2 of the Insurance Article, to investigate and enforce a violation of the provisions of this section. In addition to any other penalties under this subtitle, the Commissioner may impose a penalty not to exceed $5,000 on any health maintenance organization which violates the provisions of this section if the violation is committed with such frequency as to indicate a general business practice of the health maintenance organization. The Maryland Insurance Administration, in consultation with the Maryland Health Care Commission, shall adopt regulations to implement this section.

In this section the following words have the meanings indicated. “Carrier” means: An insurer; A nonprofit health service plan; A health maintenance organization; A dental plan organization; or Any other person or organization that provides health benefit plans subject to State regulation. “Point-of-service option” means a health benefit plan that permits a member or subscriber of a health maintenance organization to receive any health care service outside the provider panel of the health maintenance organization that is covered under the member’s or subscriber’s contract with the health maintenance organization. “Provider panel” means those providers with which a health maintenance organization contracts to provide services to the health maintenance organization’s members or subscribers under the health maintenance organization’s health benefit plan. If an employer, association, or other private group arrangement offers health benefit plan coverage to employees or individuals only through a health maintenance organization, the health maintenance organization with which the employer, association, or other private group arrangement is contracting for the coverage shall offer, or contract with another carrier to offer, a point-of-service option to the employer, association, or other private group arrangement in conjunction with the health maintenance organization as an additional benefit for an employee or individual, at the employee’s or individual’s option, to accept or reject. When a health maintenance organization is the sole delivery system offered to employees by an employer, the health maintenance organization: Shall offer the employer a point-of-service option for the individual employee to accept or reject; May not impose a minimum participation level on the point-of-service option; and As part of the group enrollment application, shall provide to each employer a disclosure statement for each point-of-service option offered that conforms to regulations, for the point-of-service option required under paragraph (1) of this subsection, adopted by: The Maryland Health Care Commission for the small group market; and The Maryland Insurance Administration for the non-small group market. An employer, association, or other private group arrangement may require an employee or individual that accepts the additional coverage under a point-of-service option under subsection (b) of this section to be responsible for the payment of a premium over the amount of the premium for the coverage offered by the health maintenance organization. A carrier may impose different cost-sharing provisions for the point-of-service option based on whether the service is provided through the provider panel of the health maintenance organization or outside the provider panel of the health maintenance organization.

Within 90 days after the filing of an application for a certificate of authority to operate as a health maintenance organization, the Commissioner shall issue the certificate of authority to the applicant if: The application conforms with § 19-708 of this subtitle; The applicant has paid the fees required by § 19-709 of this subtitle; The Department has advised in writing that the health maintenance organization’s proposed health-related services, operations, and functions that fall under the regulatory jurisdiction of the Department appear to meet its requirements or are approved by the Department; and The Commissioner is satisfied that the requirements of § 19-710 of this subtitle are met. Subject to paragraph (2) of this subsection, the provisions of Title 7 of the Insurance Article apply to health maintenance organizations. Before approving a transaction under § 7-306 of the Insurance Article, the Insurance Commissioner shall consult with the Secretary. Subsection (b) of this section may not apply to any transaction preempted by federal law.

In any case where a health maintenance organization is being merged or consolidated with or acquired by another person, any current financing money provided by the health maintenance organization to a hospital, in accordance with regulations adopted by the Health Services Cost Review Commission, in return for a discount in rates charged by the hospital shall be deemed to be security for the amount of outstanding charges owed by the health maintenance organization to the hospital for bills or claims for services provided by the hospital prior to the merger, consolidation, or acquisition.

Subject to the provisions of subsection (b) of this section, a person who holds a certificate of authority to operate a health maintenance organization under this subtitle may: Exercise the power that professional and other corporations, partnerships, associations, or other business entities have under their organizational documents and any laws of this State that do not conflict with this subtitle; Provide health care services to nonmembers who present themselves on other than a prepaid basis; Provide health care services on a prepaid basis through licensed providers of these services who are under contract with or employed by the health maintenance organization; Contract with any person to perform, on behalf of the health maintenance organization, functions such as marketing, enrollment, and administration; Contract for insurance, reinsurance, or indemnity or reimbursement against the cost of health care services provided by the health maintenance organization with: Any insurance company licensed to do health business in this State; or Any hospital, nonprofit health service plan, medical health service, nursing service, optometric service, podiatry service, dental service, pharmaceutical service plan corporation, or similar entity authorized to do business in this State; Accept from government or private agencies payments that cover all or part of the cost of subscriptions to provide health care services, facilities, appliances, medicines, and supplies; Buy, lease, construct, renovate, operate, or maintain: A hospital, medical facility, and ancillary equipment; and Property that is reasonably required for its principal office or for any other purpose necessary in the business of the health maintenance organization; and Offer indemnity benefits that cover out-of-area and emergency services. A person who holds a certificate of authority to operate a health maintenance organization under this subtitle and who enters into any administrative service provider contract, as defined in § 19-713.2 of this subtitle, with a person or entity for the provision of health care services to subscribers shall be responsible for all claims or payments for health care services: Covered under the subscriber’s contract; and Rendered by a provider, who is not the person or entity which entered into the administrative service provider contract with the health maintenance organization, pursuant to a referral by a person or entity which entered into the administrative service provider contract with the health maintenance organization. Responsibility for claims and payments under this subsection is subject to the provisions of § 15-1005 of the Insurance Article. The responsibility of a health maintenance organization for claims or payments for health care services in accordance with subsection (b) of this section under an administrative service provider contract: Is not limited by the amount in a segregated fund established under § 19-713.2 of this subtitle; Exists irrespective of the insolvency or other inability or failure of a contracting provider, as defined in § 19-713.2 of this subtitle, to pay; Exists irrespective of the delegation or further subcontracting of health care services by a contracting provider to an external provider, as defined in § 19-713.2 of this subtitle; May not be altered by contract; and Applies to all health care services, including those provided under State and federal programs, unless preempted by federal law. Subsections (b) and (c) of this section apply to a contract between a health maintenance organization and any company affiliated with the health maintenance organization through common ownership within an insurance holding company system, that meets the definition of a contracting provider under § 19-713.2 of this subtitle.

A health maintenance organization that provides pharmaceutical benefits shall notify all pharmacies under contract with the health maintenance organization in writing of changes in the pharmaceutical benefit program rules or requirements at least 30 days before the change is effective. Changes that require 30 days’ advance written notice under subsection (a) of this section are: Exclusion of coverage for classes of drugs as specified by contract; Changes in prior or preauthorization procedures; and Selection of new prescription claims processors. A health maintenance organization that fails to provide advance notice as required under subsection (a) of this section shall honor and pay in full any claim under the program rules or requirements that existed before the change for 30 days after the postmarked date of the notice.

In this section the terms “health care practitioner”, “health care entity”, and “health care service” have the same meanings as provided in § 1–301 of the Health Occupations Article. A health maintenance organization may seek repayment from a health care practitioner of any money paid for any claim, bill, or other demand or request for payment for the health care services that were determined by the appropriate regulatory licensing board to be furnished as a result of a referral prohibited by § 1–302 of the Health Occupations Article. Every contract between a health maintenance organization and its subscribers or a group of subscribers for the provision of health care services shall include a provision excluding payment of any claim, bill, or other demand or request for payment for health care services determined to be furnished as a result of a referral prohibited by § 1–302 of the Health Occupations Article. A health maintenance organization subject to the provisions of this section shall report to the Commissioner and the appropriate regulatory board any pattern of claims, bills or other demands or requests for payment submitted for a health care service provided as a result of a referral prohibited by § 1–302 of the Health Occupations Article within 30 days after that health maintenance organization has knowledge of that pattern. Notwithstanding the provisions of this section, a health maintenance organization reimbursing for health care services is not required to audit or investigate any claim, bill, or other demand or request for payment for the purpose of determining whether those services were the result of a prohibited referral. Any audit or investigation of any claim, bill, or other demand or request for payment for the purpose of determining whether those services were the result of the prohibited referral are not grounds to delay payment or waive the provisions of § 15–1005 of the Insurance Article. For any claim, bill, or request for payment that is paid and is subsequently determined to be the result of a prohibited referral, a health maintenance organization may seek a refund of that payment in accordance with the provisions of § 1–305 of the Health Occupations Article.

A health maintenance organization shall reimburse a hospital emergency facility and provider, less any applicable co–payments, for medically necessary services provided to a member or subscriber of the health maintenance organization if the health maintenance organization authorized, directed, referred, or otherwise allowed the member or subscriber to use the emergency facility and the medically necessary services are related to the condition for which the member was allowed to use the emergency facility. A health maintenance organization shall reimburse a hospital emergency facility and provider, less any applicable co–payments, for medically necessary services that relate to the condition presented and that are provided by the provider in the emergency facility to a member or subscriber of the health maintenance organization if the health maintenance organization fails to provide 24–hour access in accordance with the standards of quality of care required under § 19–705.1(b)(1)(ii) of this subtitle. A health maintenance organization shall reimburse a hospital emergency facility and provider, less any applicable co–payments, for medical screening, assessment, and stabilization services rendered to meet the requirements of the federal Emergency Medical Treatment and Active Labor Act. Notwithstanding any other provision of this subtitle, a provider may not be required to obtain prior authorization or approval for payment from a health maintenance organization in order to obtain reimbursement under subsection (a), (b), or (c) of this section. Notwithstanding any other provision of this article, a hospital emergency facility or provider or a health maintenance organization that has reimbursed a provider may collect or attempt to collect payment from a member or subscriber for health care services provided for a medical condition that is determined not to be an emergency as defined in § 19–701(e) of this subtitle. If a health maintenance organization authorizes, directs, refers, or otherwise allows a member or subscriber to access a hospital emergency facility or other urgent care facility for a medical condition that requires emergency surgery, the health maintenance organization: Shall reimburse the physician, oral surgeon, periodontist, or podiatrist, who performed the surgical procedure, for follow–up care that is: Medically necessary; Directly related to the condition for which the surgical procedure was performed; and Provided in consultation with the member’s or subscriber’s primary care physician; and May not impose on the member or subscriber any co–payment or other cost–sharing requirement for any follow–up care that exceeds what a member or subscriber is required to pay for services rendered by a physician, oral surgeon, periodontist, or podiatrist who is a member of the provider panel of the health maintenance organization.

Whenever a subscriber or an enrollee of a health maintenance organization is a resident of a continuing care facility that is regulated under Title 10, Subtitle 4 of the Human Services Article and received health care services in an acute care health care facility, the resident’s primary care physician shall refer, if medically appropriate, the resident to the skilled nursing unit at the resident’s continuing care facility for the provision of health care services included in the resident’s health maintenance organization Medicare contract if: The primary care physician and the resident or the designated representative of the resident do not choose an alternative course of treatment; The continuing care facility becomes a contracting provider in accordance with the health maintenance organization’s standard terms and conditions for its participating providers and meets the credentialing criteria for becoming a participating provider; The continuing care facility meets all the guidelines established by the Division of Licensing and Certification of the Department, including Medicare certification; and The continuing care facility’s skilled nursing unit is certified as a Medicare skilled nursing facility. The continuing care facility is not obligated to accept for the provision of health care services anyone other than a resident of the continuing care facility. The health maintenance organization and the continuing care facility are not obligated to advertise in any manner that the continuing care facility is a participating provider with respect to coverage offered by the health maintenance organization for Medicare benefits or other treatment in the skilled nursing unit for anyone other than residents of the continuing care facility.

To the extent required under federal law, a health maintenance organization shall reimburse a community health resource, as defined in § 19-2101 of this title, for covered services provided to a member or subscriber of the health maintenance organization.

Each health maintenance organization shall file with the Commissioner and pay the applicable filing fee as provided in § 2–112 of the Insurance Article, before they become effective: All rates that the health maintenance organization charges subscribers or groups of subscribers; and The form and content of each contract between the health maintenance organization and its subscribers or groups of subscribers. A health maintenance organization that offers a health benefit plan, as defined in § 11–601 of the Insurance Article, is subject to Title 11, Subtitle 6 of the Insurance Article for the health benefit plan. If the provisions of Title 11, Subtitle 6 of the Insurance Article conflict with the provisions of this section, the provisions of Title 11, Subtitle 6 of the Insurance Article shall prevail. Rates of a health maintenance organization may not be excessive, inadequate, or unfairly discriminatory in relation to the services offered. A health maintenance organization that includes a subrogation provision in its contract as authorized under § 19-713.1(d) of this subtitle shall: Use in its rating methodology an adjustment that reflects the subrogation; and Identify in its rate filing with the Maryland Insurance Administration, and annually in a form approved by the Insurance Commissioner, all amounts recovered through subrogation. If, at any time, a health maintenance organization wishes to amend any contract with its subscribers or change any rate charged, the health maintenance organization shall file with the Commissioner the number of copies of the amendment or rate change that the Commissioner requires. The Commissioner shall provide the Department with the number of copies it requires. The Commissioner shall coordinate the contract and related rate filing review under this section. If within 60 days after a filing made pursuant to this section, the Commissioner finds the filing does not meet the requirements of subsection (f) of this section, the filer shall be sent notice of disapproval specifying in what respects the Commissioner finds that the filing fails to meet the requirements of this section and stating that the filing shall not become effective. The Commissioner may extend the initial review period described in paragraph (1) of this subsection for up to an additional 30 days if the Commissioner gives notice to the health maintenance organization of the extension before the initial review period ends. The Commissioner may not issue a notice of disapproval of a filing under subsection (f) of this section without a statutory or regulatory basis for the disapproval and an explanation of the application of the statutory or regulatory basis which resulted in the disapproval. The Commissioner shall disapprove any form filed, or withdraw any previous approval, if the form: Is in any respect in violation or does not comply with this article or applicable regulations; Contains, or incorporates by reference, any inconsistent or inapplicable clauses, exceptions, or conditions which affect the risk purported to be assumed in the general coverage of the contract; Has any title, heading, or other indication of its provisions which is likely to mislead the subscriber or member; Includes provisions that are inequitable, or provisions that lack any substantial benefit to the subscriber or member; Is printed or otherwise reproduced in a manner as to render any provision of the form substantially illegible; or Provides benefits that are unreasonable in relation to the premium charged. Except as provided in paragraph (2) of this subsection, unless the Commissioner disapproves a filing under this section, the filing becomes effective: 60 days after the office of the Commissioner receives the filing; If the Commissioner extends the review period under subsection (e)(2) of this section, on the date specified in the notice required under subsection (e)(2) of this section; or On any other date that the Commissioner sets. The Commissioner may adopt regulations to allow a type or kind of form to be effective upon receipt of the filing by the Commissioner. If a health maintenance organization uses a form which becomes effective in accordance with the provisions of paragraph (2) of this subsection and the form would be subject to disapproval under subsection (f) of this section, the Commissioner may: Subsequently disapprove the form; and Find the health maintenance organization to be in violation of § 19–729 of this subtitle and impose a penalty as provided in § 19–730 of this subtitle. If a health maintenance organization files a form with the Commissioner which becomes effective in accordance with the provisions of paragraph (2) of this subsection, the health maintenance organization shall pay the applicable filing fee provided in § 2–112 of the Insurance Article.

A contract between a health maintenance organization and its subscribers or a group of subscribers may contain nonduplication provisions or provisions to coordinate the coverage with subscriber contracts of other health maintenance organizations, health insurance policies, including those of nonprofit health service plans, and with other established programs under which the subscriber or member may make a claim. Notwithstanding the provisions of subsection (a) of this section, a contract between a health maintenance organization and its subscribers or a group of subscribers may not contain nonduplication provisions or provisions to coordinate coverage with any individually underwritten and issued, guaranteed renewable, specified disease policy, as defined in § 15-109 of the Insurance Article, or intensive care policy, which does not provide benefits on an expense incurred basis. For purposes of this section, “intensive care policy” means a health insurance policy that provides benefits only when treatment is received in that specifically designated facility of a hospital that provides the highest level of care and which is restricted to those patients who are physically, critically ill or injured. Notwithstanding § 19-701(g)(3) of this subtitle, a contract between a health maintenance organization and its subscribers or a group of subscribers may contain a provision allowing the health maintenance organization to be subrogated to a cause of action that a subscriber has against another person: To the extent that any actual payments made by the health maintenance organization result from the occurrence that gave rise to the cause of action; or For a nonprofit health maintenance organization that exclusively contracts with a group of physicians to provide or to arrange for the provision of health care services for its enrollees, for any service provided by the health maintenance organization as a result of the occurrence that gave rise to the cause of action, per the fee schedule established by the nonprofit health maintenance organization. Subsection (d) of this section does not allow a contract between a health maintenance organization and its subscribers or a group of subscribers to contain a provision allowing the health maintenance organization to recover any payments made to a subscriber under the personal injury protection coverage of a motor vehicle liability insurance policy. A contract between a health maintenance organization and its subscribers or a group of subscribers may not contain a provision that requires personal injury protection benefits under a motor vehicle liability insurance policy to be paid before benefits under the contract. Subsection (d) of this section does not allow a health maintenance organization to recover medical expenses from a subscriber under a subrogation provision unless the subscriber recovers for medical expenses in a cause of action.

In this section the following words have the meanings indicated. “Administrative service provider contract” means a contract or capitation agreement between a health maintenance organization and a contracting provider which includes requirements that: The contracting provider accept payments from a health maintenance organization for health care services to be provided to members of the health maintenance organization that the contracting provider arranges to be provided by external providers; and The contracting provider administer payments pursuant to the contract with the health maintenance organization for the health care services to the external providers. “Contracting provider” means a person who enters into an administrative service provider contract with a health maintenance organization. “Contracting provider” does not include a medical laboratory as defined in § 17–201 of this article. “External provider” means a health care provider, including a physician or hospital, who is not: A contracting provider; or An employee, shareholder, or partner of a contracting provider. This section does not apply to a contract between a health maintenance organization and a contracting provider that is affiliated with the health maintenance organization through common ownership within an insurance holding company system, if the health maintenance organization: Files with the Commissioner consolidated financial statements that include the contracting provider; and Records a reserve for the liabilities of the contracting provider in accordance with § 5-201 of the Insurance Article. A health maintenance organization may not enter into an administrative service provider contract unless: The health maintenance organization files with the Insurance Commissioner a plan that satisfies the requirements of subsection (d) of this section; and The Insurance Commissioner does not disapprove the filing within 30 days after the plan is filed. The plan required under subsection (c) of this section shall: Require the contracting provider to provide the health maintenance organization with monthly reports, within 30 days of the end of the month reported, that identify payments made or owed to external providers in sufficient detail to determine if the payments are being made in compliance with law; Require the contracting provider to provide to the health maintenance organization a current annual financial statement of the contracting provider each year, within 90 days of the end of the year reported; Require the health maintenance organization to establish and maintain a segregated fund, in a form and an amount approved by the Commissioner, which may include withheld funds, escrow accounts, letters of credit, or similar arrangements, or require the availability of other resources that are sufficient to satisfy the contracting provider’s obligations to external providers for services rendered to members of the health maintenance organization; Require the contracting provider to submit to the health maintenance organization information demonstrating that the fund established under item (3) of this subsection is sufficient to satisfy the contracting provider’s obligations to external providers for services rendered to members of the health maintenance organization; and Require the health maintenance organization, at least quarterly, to review and inspect the contracting provider’s books, records, and operations relevant to the provider’s contract for the purpose of determining the contracting provider’s compliance with the plan. In determining the sufficiency of a segregated fund, the Commissioner may consider whether external providers are owned or controlled by the contracting provider. The segregated fund or other resources established as a result of an administrative service provider contract: Shall be held in trust for payment to external providers; and May not be considered an asset or an account of the contracting provider for the purpose of determining the assets or accounts of a bankrupt contracting provider. The health maintenance organization and the contracting provider shall comply with the plan. The health maintenance organization shall monitor the contracting provider to assure compliance with the plan, and the health maintenance organization shall notify the contracting provider whenever a failure to comply with the plan occurs. Upon the failure of the contracting provider to comply with the plan following notice of noncompliance, or upon termination of the administrative service provider contract for any reason, the health maintenance organization shall notify the Commissioner and shall assume the administration of any payments due from the contracting provider to external providers on behalf of the contracting provider, as required under § 19-712 of this subtitle. The health maintenance organization shall file with the Commissioner, the results of each quarterly review required under subsection (d)(5) of this section. The plan and all supporting documentation submitted in connection with the plan shall be treated as confidential and proprietary, and may not be disclosed except as otherwise required by law. A health maintenance organization and a contracting provider shall comply with the terms of an administrative service provider contract as required under this section and § 19-712 of this subtitle. If a contracting provider fails to comply with the plan or the administrative service provider contract, as required under subsections (g) and (k) of this section, the Commissioner may impose a fine not exceeding $125,000 or suspend or revoke the registration of the contracting provider under § 19-713.3 of this subtitle, or both.

In this section the following words have the meanings indicated. “Administrative service provider contract” has the meaning stated in § 19-713.2 of this subtitle. “Contracting provider” has the meaning stated in § 19-713.2 of this subtitle. A person must register with the Commissioner before the person acts as a contracting provider in this State. A health maintenance organization may not enter into an administrative service provider contract with a contracting provider that has not registered with the Commissioner. An applicant for registration shall submit an application to the Commissioner in a form approved by the Commissioner and include any information required under subsection (e) of this section. A registration under this section expires 2 years from the date the application is approved. The Commissioner may charge a registration fee sufficient to cover the cost of implementing this section. The Commissioner may adopt regulations to carry out the provisions of this section and § 19-713.2 of this subtitle.

In this section, “health maintenance organization” or “HMO” includes any agent of a health maintenance organization. A health maintenance organization that issues a request for proposal, including changes in terms to an existing contract to provide pharmaceutical services, shall notify the Maryland Pharmacists Association of the request for proposal to provide pharmaceutical services within 10 days after issuing that request. The Maryland Pharmacists Association may inform licensed pharmacists of the request. A health maintenance organization may not charge a fee for processing or accepting an application to provide pharmaceutical services. This section does not apply to a health maintenance organization if the health maintenance organization provides pharmaceutical services from a pharmacy that is: Located on the site of the health maintenance organization; and Wholly owned and operated by the health maintenance organization.

If a health maintenance organization requires its subscribers to have a referral to receive consultation services in writing, the health maintenance organization shall use the uniform consultation referral form adopted by the Commissioner under § 15-120 of the Insurance Article as the sole instrument for referrals for consultation services. A health maintenance organization may not impose as a condition of coverage any requirement to: Modify the uniform consultation referral form; or Submit additional consultation referral forms. The uniform consultation referral form shall be properly completed by the health care provider referring the subscriber for consultation services.

In this section the following words have the meanings indicated. “Documented informed consent” means: A written consent form signed by a patient; or Verbal or otherwise communicated consent signified by a notation in a patient’s electronic medical record maintained by a group model health maintenance organization. “Drug therapy management” means treatment of a patient using drug therapy, laboratory tests, or medical devices under conditions or limitations set forth in a protocol specified in a physician–pharmacist agreement for the purpose of improving patient outcome. “Group model health maintenance organization” means a health maintenance organization that: Contracts with one multispecialty group of physicians who are employed by and shareholders of the multispecialty group; and Provides and arranges for the provision of physician services to patients at medical facilities operated by the health maintenance organization. “Licensed pharmacist” means an individual who is licensed to practice pharmacy under Title 12 of the Health Occupations Article. “Licensed physician” means an individual who is licensed to practice medicine under Title 14 of the Health Occupations Article. “Patient” means: A patient who is a member of a group model health maintenance organization; or An individual to whom the group model health maintenance organization is contractually or legally obligated to provide, or arrange to provide, health care services. “Physician–pharmacist agreement” means an agreement between a licensed physician and a licensed pharmacist that is disease–state specific and specifies the protocols that may be used. “Protocol” means a course of treatment predetermined by the licensed physician and licensed pharmacist according to generally accepted medical practice for the proper completion of a particular therapeutic or diagnostic intervention. In a group model health maintenance organization, a licensed physician and a licensed pharmacist who wish to provide drug therapy management to patients shall have a physician–pharmacist agreement. Drug therapy management shall be provided under this section only: In accordance with a physician–pharmacist agreement; and Through the internal pharmacy operations of the group model health maintenance organization. A licensed physician who has entered into a physician–pharmacist agreement shall submit to the State Board of Physicians a copy of the physician–pharmacist agreement and any subsequent modifications made to the physician–pharmacist agreement or the protocols specified in the physician–pharmacist agreement. A licensed pharmacist who has entered into a physician–pharmacist agreement shall submit to the State Board of Pharmacy a copy of the physician–pharmacist agreement and any subsequent modifications made to the physician–pharmacist agreement or the protocols specified in the physician–pharmacist agreement. A licensed pharmacist is authorized to enter into a physician–pharmacist agreement if the licensed pharmacist: Has a Doctor of Pharmacy degree or equivalent training as established in regulations adopted by the State Board of Pharmacy; Is approved by the State Board of Pharmacy to enter into a physician–pharmacist agreement with a licensed physician; and Meets any other requirements established by regulation by the State Board of Pharmacy. A physician–pharmacist agreement shall prohibit the substitution of a chemically dissimilar drug product by the pharmacist for the product prescribed by the physician, unless permitted in the protocol specified in the physician–pharmacist agreement. A patient may decline to participate or withdraw from participating in drug therapy management in a group model health maintenance organization at any time. A licensed physician or licensed pharmacist or both shall inform a patient: Regarding the procedures that will be utilized for drug therapy management under the associated protocols; That the patient may decline to participate or withdraw from participating in the drug therapy management at any time; and That neither the physician nor the pharmacist has been coerced, given economic incentives, excluding normal reimbursement for services rendered, or involuntarily required to participate. A licensed physician or a licensed pharmacist or both shall obtain documented informed consent from a patient after disclosing the information required to be disclosed under subsection (f) of this section.

Each marketing document that sets forth the health care services of a health maintenance organization shall describe fully and clearly: The health care services under each benefit package and every other benefit to which a member is entitled; Where and how services may be obtained; Each exclusion or limitation on any service or other benefit that it provides; Each deductible feature; Each copayment provision; and All information required by § 15-1206 of the Insurance Article.

Each health maintenance organization application or offer of enrollment shall contain or be accompanied by, and each form of health maintenance organization subscriber contract shall contain, a full and clear statement of: The items specified in § 19-714 of this subtitle; The rate of periodic payment; When the coverage is effective and what restrictions, if any, apply to preexisting conditions; All standards for cancellation of enrollment or denial of reenrollment; and Service priorities, if any, in epidemic or other emergency or catastrophic conditions that may cause an unusually high demand for medical services.

Annually, each health maintenance organization shall provide to its members and make available to the general public, in clear, readable, and concise form: A summary of the most recent financial report that the health maintenance organization submits to the Commissioner under § 19-717 of this subtitle; A description of the benefit packages available and the nongroup rates required by the Commissioner; A description of the accessibility and availability of services, including where and how to obtain them; A statement of the potential responsibility of a member for payment for services the member seeks to obtain from a provider, including a physician or hospital, that does not have a written contract with the health maintenance organization; A description of procedures to be followed for emergency services, including: The appropriate use of hospital emergency facilities; The appropriate use, location, and hours of operation of any urgent care facilities operated by the health maintenance organization; and The potential responsibility of subscribers and enrollees for payment for emergency services or nonemergency services rendered in a hospital emergency facility; A statement that shows, by category, the percentage of members assisted by public funds; The information required to be disclosed by § 15-1206 of the Insurance Article; and Any other information that the Commissioner or the Department requires by rule or regulation.

Except as provided in subsections (b) and (c) of this section and unless, for good cause shown, the Commissioner extends the time for a reasonable period: On or before March 1 of each year, each health maintenance organization shall file with the Commissioner a report that shows the financial condition of the health maintenance organization on the last day of the preceding calendar year and any other information that the Commissioner requires by rule or regulation; and On or before June 1 of each year, each health maintenance organization shall file with the Commissioner an audited financial report for the preceding calendar year. A health maintenance organization that has a fiscal year other than the calendar year may request permission to file both the annual report required under subsection (a)(1) of this section and the audited financial report required under subsection (a)(2) of this section at the end of its fiscal year rather than the preceding calendar year. If the Commissioner grants this permission, the health maintenance organization shall file the annual report with the Commissioner within 60 days after the end of its fiscal year, and the health maintenance organization shall file the audited financial report with the Commissioner within 150 days after the end of its fiscal year. With 90 days’ advance notice, the Commissioner may require a health maintenance organization to file an audited financial report earlier than the date specified in subsection (a) of this section. The annual report shall: Be on the forms that the Commissioner requires; and Include a description of any changes in the information submitted under § 19–708 of this subtitle. The audited financial report shall: Be on the forms that the Commissioner requires; and Be certified by an audit of a certified public accounting firm. Each financial report filed under this section is a public record.

Under rules, regulations, and procedures that the Secretary approves and using methods that keep the identity of patients as confidential as possible, assure objective evaluation, and are consistent with § 19-710 of this subtitle, the Department may do periodic examinations to: Determine the quality of health care services being provided by health maintenance organizations; and Develop statistical information.

The State Health Services Cost Review Commission promptly shall give the Commissioner and the Secretary any financial information that the Commission acquires about each facility that is: Under the jurisdiction of the Commission; and Subject to this subtitle. If requested by the Commissioner or the Secretary, the State Health Services Cost Review Commission shall provide any other information that the Commission is authorized to acquire about health maintenance organizations regulated under this subtitle.

Unless previously suspended or revoked, each original and renewal certificate of authority issued under this subtitle to a health maintenance organization expires at midnight on the November 30 after its effective date. On payment of an annual renewal fee of $25 by the health maintenance organization before the expiration date of its certificate of authority, its certificate remains in effect until a new certificate of authority is issued or specifically refused.

The Commissioner may refuse to renew a certificate of authority for any reason for which the Commissioner may: Refuse to issue an original certificate; or Suspend or revoke an existing certificate. If the Commissioner refuses to renew a certificate of authority, the applicant has the same administrative and legal remedies as those provided under this subtitle for the suspension or revocation of a certificate of authority.

At all times, each health maintenance organization is subject to the supervision of the Commissioner and the Department as provided in this subtitle. Any health maintenance organization that contracts with the Department and is subject to this subtitle shall act in concert with the Department or with the written consent of the Department concerning all information that the Commissioner requires.

Except as provided in subsection (b) of this section, a health maintenance organization may solicit members through advertising its services, charges, or nonprofessional aspects of its operation. A health maintenance organization may not use any advertising that makes any qualitative judgment about any person who provides services for a health maintenance organization.

A health maintenance organization may not cancel the enrollment of a member or refuse to transfer a member from a group to an individual basis because of age, sex, sexual orientation, gender identity, religious beliefs, disability, race, or health status. A health maintenance organization may cancel a contract with a member who violates any published policy of the health maintenance organization that has been approved by the Commissioner and the Department under their joint internal procedures.

A health maintenance organization may not include in its name: The words “insurer”, “casualty”, “surety”, or “health and accident”; or Any other words generally regarded as descriptive of the insurance industry. This subsection does not apply to an insurer or health service corporation that is licensed and regulated under the laws of this State, except as to its health maintenance organization activities that are authorized and regulated under this subtitle. Except as authorized by the Commissioner under this subtitle, a person other than a health maintenance organization regulated under this subtitle may not designate its services, operations, or functions as a “health maintenance organization” or use any other title or designation if the arrangement of services, operations, or functions substantially fall under the definition of a health maintenance organization in § 19-701 of this subtitle.

Except as provided in subsection (b) of this section, a health maintenance organization is not exempted from any State, county, or local taxes solely because of this subtitle. A nonprofit health maintenance organization that is exempt from taxation under § 501(c)(3) of the Internal Revenue Code is not subject to the insurance premium tax under Title 6, Subtitle 1 of the Insurance Article. Premiums received by an insurer under policies that provide health maintenance organization benefits are not subject to the premium tax imposed under Title 6, Subtitle 1 of the Insurance Article to the extent: Of the amounts actually paid by the insurer to a nonprofit health maintenance organization that operates only as a health maintenance organization; or The premiums have been paid by that nonprofit health maintenance organization.

The Commissioner is responsible for: Determining whether each health maintenance organization is or will be able to provide a fiscally sound operation and adequate provision against risk of insolvency and may adopt reasonable rules and regulations designed to achieve this goal; and Actuarial and financial evaluations and determinations of each health maintenance organization. If the Commissioner determines that a health maintenance organization is not operating in a fiscally sound manner, the Commissioner shall notify the Department of the determination. After notifying the Department in accordance with the provisions of paragraph (1) of this subsection, the Commissioner shall monitor the health maintenance organization on a continuous basis until the Commissioner determines that the health maintenance organization is operating in a fiscally sound manner.

A health maintenance organization may not: Violate any provision of this subtitle or any rule or regulation adopted under it; Fail to fulfill its obligations to provide the health care services specified in its contracts with subscribers; Make any false statement with respect to any report or statement required by this subtitle or by the Commissioner under this subtitle; Advertise, merchandise, or attempt to merchandise its services in a way that misrepresents its services or capacity for service; Engage in a deceptive, misleading, unfair, or unauthorized practice as to advertising or merchandising; Prevent or attempt to prevent the Commissioner or the Department from performing any duty imposed by this subtitle; Fraudulently obtain or fraudulently attempt to obtain any benefit under this subtitle; Fail to fulfill the basic requirements to operate as a health maintenance organization as provided in § 19–710 of this subtitle; Violate any applicable provision of Title 15, Subtitle 12 of the Insurance Article; Fail to provide services to a member in a timely manner as provided in § 19–705.1(b)(1) of this subtitle; Fail to comply with the provisions of Title 15, Subtitle 10A, 10B, 10C, or 10D or § 2–112.2 of the Insurance Article; Violate any provision of § 19–712.5 of this subtitle; or Violate any provision of Title 33 of the Insurance Article. If any health maintenance organization violates this section, the Commissioner may pursue any one or more of the courses of action described in § 19-730 of this subtitle.

If any person violates any provision of § 19-729 of this subtitle, the Commissioner may: Issue an administrative order that requires the health maintenance organization to: Cease inappropriate conduct or practices by it or any of the personnel employed or associated with it; Fulfill its contractual obligations; Provide a service that has been denied improperly; Take appropriate steps to restore its ability to provide a service that is provided under a contract; Cease the enrollment of any additional enrollees except newborn children or other newly acquired dependents of existing enrollees; or Cease any advertising or solicitation; In addition to suspending or revoking a certificate of authority: Impose a penalty of not less than $100, but not more than $125,000 for each violation; and Order the health maintenance organization to pay restitution to any person who has suffered financial injury because of the violation; Suspend, revoke, or refuse to renew the certificate of authority to do business as a health maintenance organization; Suspend, revoke, or refuse to renew the certificate of a medical director of a health maintenance organization; or Apply to any court for legal or equitable relief considered appropriate by the Commissioner or the Department, in accordance with the joint internal procedures. If the Commissioner issues an order or imposes any penalty under this section, the Commissioner immediately shall provide written notice of the order or penalty to the Secretary.

If a person violates any provision of §§ 19-705 and 19-705.1 of this subtitle, the Secretary may: Issue an administrative order that requires the health maintenance organization to: Cease inappropriate conduct or practices by it or any of the personnel employed by or associated with it and comply with the standards established by the Department; or Provide any service required by §§ 19-705 and 19-705.1 of this subtitle that has been denied improperly; Impose a penalty of not less than $100 and not more than $125,000 for each violation; or Apply to any court for legal or equitable relief considered appropriate by the Secretary. If the Secretary issues an order or imposes any penalty under this section, the Secretary immediately shall provide written notice of the order or penalty to the Commissioner.

Except as otherwise provided in Title 15, Subtitle 10A of the Insurance Article, a party aggrieved by a final action of the Commissioner under this subtitle has the right to a hearing and the right to appeal from the action of the Commissioner under §§ 2–210 through 2–215 of the Insurance Article. A party aggrieved by an order of the Secretary under this subtitle may petition for judicial review as provided by the Administrative Procedure Act.

This subtitle may be cited as the “Maryland Health Maintenance Organization Act”.

Any foreign health maintenance organization with a certificate of authority to operate a health maintenance organization in this State may become a domestic health maintenance organization of this State by complying with all of the requirements of the law relating to the formation and organization of a domestic health maintenance organization and by designating its principal place of business at a place in this State. On becoming a domestic health maintenance organization, the health maintenance organization shall be entitled to certificates and licenses to transact business in this State issued to domestic health maintenance organizations, and shall be given recognition in all respects as a health maintenance organization formed under the laws of this State as of the date of authorization as a health maintenance organization in its original domiciliary state, district, territory, commonwealth, or possession of the United States of America, and shall be subject to the authority and jurisdiction of this State. The certificate of authority, insurance producers’ appointments, rates, and other forms which the Commissioner allows which are in existence at the time any foreign health maintenance organization with a certificate of authority to operate a health maintenance organization in this State transfers its corporate domicile to this State or to any other state by merger, consolidation, or any other lawful method shall continue in full force and effect on transfer if the health maintenance organization at all times retains a certificate of authority in this State. All outstanding subscriber contracts of a transferring health maintenance organization shall remain in full force and effect and need not be endorsed as to the new name of the health maintenance organization or its new domiciliary and location unless so ordered by the Commissioner. A transferring health maintenance organization may file new contract forms with the Commissioner on or before the effective date of the transfer, or may use any existing contract form previously filed with the Commissioner with appropriate endorsements if allowed by and under such conditions as approved by the Commissioner. A foreign health maintenance organization transferring its domicile to another state shall notify the Commissioner of the details of the proposed transfer, and shall file promptly any resulting amendments to corporate documents and other items on file with the Commissioner.