In this subtitle the following words have the meanings indicated.
“Dental plan” means a contractual arrangement for dental services.
“Dental plan organization” means a person that provides directly, arranges for, or administers a dental plan on a prepaid or postpaid individual or group capitation basis.
“Dental service” means a service included in practicing dentistry as defined in § 4-101 of the Health Occupations Article.
“Enrollee” means an individual or dependent of the individual who is enrolled in a dental plan.
“Evidence of coverage” means a contract or certificate that is issued to an enrollee and that specifies the dental services to which the enrollee is entitled.
This subtitle does not apply to:
a dentist or professional dental corporation that accepts payment on a fee-for-service basis for providing specific dental services to individual patients for whom the services have been prediagnosed;
an authorized insurer whose activities are authorized and regulated under other provisions of this article;
a nonprofit health service plan that is subject to Subtitle 1 of this title;
a health maintenance organization that is authorized by and subject to Title 19, Subtitle 7 of the Health - General Article; or
a dental plan whose regulation by the State is preempted by federal law.
In addition to the provisions of this subtitle, dental plan organizations are subject to the provisions of Title 2, Subtitle 5 of this article.
A person may not establish, operate, or administer a dental plan organization or sell, offer to sell, solicit offers to purchase, or receive advance or periodic consideration in conjunction with a dental plan, unless the person has a certificate of authority issued by the Commissioner under this subtitle.
Except as provided in subsection (d) of this section, in accordance with this section, a dental plan organization shall have and maintain at all times a surplus equal to the greater of:
$50,000; or
2% of the organizations’ annual gross premium income, up to a maximum of the required capital and surplus of a stock insurer under § 4-103 of this article.
Except as provided in subsection (d) of this section, a dental plan organization shall deposit with the Commissioner or with any organization or trustee acceptable to the Commissioner through which a custodial or controlled account is used, cash, securities, or any combination of these or other measures that is acceptable to the Commissioner in an amount equal to $25,000 plus 25% of the surplus required in subsection (a) of this section, provided that the deposit shall not be required to exceed $100,000.
The deposit shall be:
an admitted asset of the dental plan organization in the determination of surplus;
used to protect the interests of the dental plan organization’s enrollees;
used to assure continuation of limited health care services to enrollees of a dental plan organization that is in rehabilitation or conservation; and
if a dental plan organization is placed in receivership or liquidation, an asset subject to provisions of the Uniform Insurers Liquidation Act.
All income from deposits shall be an asset of the dental plan organization.
A dental plan organization may withdraw a deposit or any part thereof after making a substitute deposit of equal amount and value.
A substitute deposit of any securities is subject to the approval of the Commissioner.
Except as provided in subsection (d) of this section, the Commissioner may reduce or eliminate the deposit requirement if the dental plan organization has made an acceptable deposit with the State or jurisdiction of domicile for the protection of all enrollees, wherever located, and delivers to the Commissioner a certificate to such effect, duly authenticated by the appropriate State official holding the deposit.
Subject to subsection (e) of this section, subsections (a), (b), and (c) of this section do not apply to a dental plan organization, so long as the dental plan organization:
did not have any enrollees as of January 1, 2000;
held a certificate of authority as of January 1, 2000;
maintains a current certificate of authority; and
complies with all applicable laws and regulations, as determined by the Commissioner.
Subsection (d) of this section does not apply to a dental plan organization that has one or more enrollees on or after January 1, 2000.
An applicant for a certificate of authority shall:
file with the Commissioner an application, verified by an officer or authorized representative of the dental plan organization, on the form that the Commissioner provides; and
pay to the Commissioner an application fee of $200.
An application for a certificate of authority shall include:
the basic organizational documents of the dental plan organization, including the articles of incorporation, articles of association, partnership agreement, trade name certificate, trust agreement, and shareholder agreement;
all amendments to the organizational documents of the dental plan organization;
the bylaws, rules and regulations, or similar documents that regulate the conduct or internal affairs of the dental plan organization;
the names, addresses, and official positions of the individuals who are responsible for conducting the affairs of the dental plan organization, including:
the members of the board of directors, board of trustees, executive committee, or other governing board or committee;
for a corporation, the principal officers; and
for a partnership or association, the partners or members;
each contract made between a dentist and the dental plan organization;
each contract made between a dentist and an individual listed in item (4) of this subsection, a consultant, or a business manager;
a description of the dental plan organization and its dental plan or plans, facilities, and personnel;
the form of evidence of coverage to be issued to enrollees;
the form of each group contract that is issued to employers, unions, trustees, or others;
a financial statement that details the assets, liabilities, and sources of financial support for the dental plan organization or, if the financial affairs are audited by an independent certified public accountant, a copy of the most recent regular certified financial statement, unless the Commissioner determines that additional or more recent financial information is required for the proper administration of this subtitle;
the proposed method of marketing the dental plan, a financial plan with a 3-year projection of the initial operating results, and a statement of the sources of working capital and any other sources of funding;
if a dental plan organization is not domiciled in the State, an executed power of attorney that appoints the Commissioner as attorney for service of process issued against the dental plan organization in the State;
a description of the geographic area to be served by the dental plan organization; and
any other information that the Commissioner requires.
Within 10 days after a significant modification of information submitted with the application for a certificate of authority, a dental plan organization shall file notice of the modification with the Commissioner.
If the Commissioner is satisfied that the individuals who are responsible for conducting the affairs of the dental plan organization are trustworthy and capable of providing, arranging for, or administering the services offered by the dental plan, the Commissioner shall issue a certificate of authority.
If the Commissioner disapproves an application for a certificate of authority, the Commissioner shall notify the dental plan organization in writing of the reasons for disapproval.
A certificate of authority expires on the first June 30 after its effective date unless it is renewed as provided in this section.
The Commissioner shall renew the certificate of authority of a dental plan organization if the dental plan organization remains in compliance with this subtitle and pays to the Commissioner a renewal fee of $100.
The Commissioner may suspend or revoke a certificate of authority issued to a dental plan organization under this subtitle if the Commissioner finds that:
the dental plan organization is operating in a manner significantly contrary to that described in §§ 14-403, 14-405, 14-407, and 14-408 of this subtitle;
the dental plan organization issues evidence of coverage that does not comply with § 14-410 of this subtitle;
the dental plan organization can no longer be expected to meet its obligations to enrollees;
the agreements of the dental plan organization with dentists are not sufficient to provide the dental services covered by the dental plan;
the dental plan organization, or authorized person acting on its behalf, has advertised or merchandised its services in an untrue or misleading manner;
the conditions or methods of operation of the dental plan organization make continued operation hazardous to enrollees or the public; or
the dental plan organization has failed to comply with this subtitle or any regulations adopted under this subtitle.
If the Commissioner has cause to believe that grounds exist for the suspension or revocation of a certificate of authority, the Commissioner shall notify the dental plan organization of the suspension or revocation in writing and the grounds.
If the Commissioner suspends the certificate of authority, the dental plan organization may not accept additional enrollees or engage in advertising or solicitation during the period of suspension.
If the Commissioner revokes the certificate of authority, the dental plan organization shall dissolve its structure immediately after the effective date of the order of revocation and may not conduct further business, except as essential to the orderly conclusion of the affairs of the dental plan organization.
By written order, the Commissioner may allow further operation of the dental plan organization if the Commissioner finds that it is in the best interest of enrollees and that enrollees will be afforded the greatest practical opportunity to obtain continuing dental plan coverage.
Instead of or in addition to suspending or revoking a certificate of authority, the Commissioner may:
impose on the holder a penalty of not less than $1,000 but not exceeding $50,000 for each violation of this subtitle; and
require the holder to make restitution to any person who has suffered financial injury because of a violation of this subtitle.
Notwithstanding subsections (c), (d), and (e) of this section, a dental plan organization that has had its certificate of authority suspended or revoked, has been ordered to pay a penalty or make restitution, or has suffered an adverse decision by the Commissioner is entitled to a hearing under § 2-210 of this article.
Hearings and appeals from orders of the Commissioner are governed by §§ 2-203 and 2-210 through 2-215 of this article.
Each enrollee shall receive evidence of coverage that indicates specifically the nature and extent of coverage and the total amount or percentage of payment, if any, that the enrollee must pay for dental services.
Except as provided under paragraph (2) of this subsection, a dental plan organization shall issue evidence of coverage to each enrollee of the dental plan organization.
If an individual enrollee obtains coverage through a policy or through a contract issued by a medical or dental service corporation, the insurer that issued the policy or the medical or dental service corporation shall issue evidence of coverage.
The dental plan organization, insurer, or medical or dental service corporation may not issue or deliver evidence of coverage or an amendment to evidence of coverage until a copy of the form of evidence of coverage or amendment is filed with and approved by the Commissioner.
The evidence of coverage shall contain:
a clear and complete statement if a contract, or a reasonably complete summary if a certificate, of:
the dental services and the insurance or other benefits, if any, to which enrollees are entitled;
any limitations on the services or kind of benefits to be provided, including any charge, deductible, or copayment feature; and
where and in what manner information is available about how services may be obtained; and
a clear and understandable description of the dental plan organization’s method for resolving enrollee complaints.
A dental plan organization, insurer, or medical or dental service corporation that makes a change in evidence of coverage or the amount or percentage of payment that the enrollee must pay, shall issue to the enrollee evidence of the change in a separate document.
The Commissioner may investigate the business and examine the books, accounts, records, and files of each dental plan organization and to do so shall have reasonably free access to those materials and to the offices and places of business of the dental plan organization.
A dental plan organization shall preserve its books, accounts, and records for at least 5 years.
Preservation by photographic reproduction shall constitute compliance with this subtitle.
At the discretion of the Commissioner, the Secretary of Health and the State Board of Dental Examiners may participate in investigations and examinations described in this section to verify the solvency of a dental plan organization.
In an examination under this section, the person examined shall pay the expense incurred by the Commissioner, Secretary of Health, and State Board of Dental Examiners in accordance with § 2–208 of this article.
A dental plan organization shall establish and maintain a complaint system to provide reasonable procedures for the resolution of written complaints initiated by enrollees about services of the dental plan organization.
The dental plan organization shall maintain records of all written complaints initiated by enrollees.
The Commissioner may examine the complaint system of a dental plan organization.
If the Commissioner determines that the complaint system is inadequate, the Commissioner may require a revision of the complaint system.
On or before March 1 of each year, each dental plan organization shall file with the Commissioner a complete statement of its financial condition, transactions, and affairs for the immediately preceding calendar year.
The annual statement shall:
be in the form and have the content approved for current use by the National Association of Insurance Commissioners or its successor organization; and
contain any additional information that the Commissioner requires.
Unless the Commissioner extends the time for filing, a dental plan organization that fails to file an annual statement on or before March 10 shall pay a penalty of:
$100 for each day from March 1 to March 10, both inclusive; and
$150 for each day from March 11 to the day before the Commissioner receives the report, both inclusive.
At any time, the Commissioner may require a dental plan organization doing business in the State to file an interim statement containing the information that the Commissioner considers necessary.
Except as provided in paragraph (5) of this subsection, on or before June 1 of each year, each dental plan organization shall file with the Commissioner an audited financial report for the immediately preceding calendar year.
The dental plan organization shall have the audited financial report prepared by an independent certified public accountant.
The Commissioner may:
set requirements for the form and content of the audited financial report; and
for good cause, extend the time for filing the audited financial report.
Unless the Commissioner extends the time for filing, a dental plan organization that fails to file an audited financial report on or before June 10 shall pay a penalty of:
$100 for each day from June 1 to June 10, both inclusive; and
$150 for each day from June 11 to the day before the Commissioner receives the report, both inclusive.
With 90 days’ advance notice, the Commissioner may require a dental plan organization to file an audited financial report earlier than the date specified in paragraph (1) of this subsection.
A dental plan organization may not use more than 50% of its gross contract and certificate income in any fiscal year for general operating expenses, acquisition expenses, and miscellaneous taxes, licenses, and fees.
A dental plan organization or its representative may not cause or knowingly allow:
advertising that is untrue or misleading;
solicitation that is untrue or misleading; or
any form of evidence of coverage that is deceptive.
Unless a dental plan organization holds a certificate of authority as an insurer, the dental plan organization may not use in its name, evidence of coverage, or literature:
the words “insurance”, “assurance”, “casualty”, “surety”, or “mutual”; or
any other words descriptive of the insurance, casualty, or surety business or deceptively similar to the name or description of an insurer authorized to do business in the State.
The Commissioner shall enforce this section.
This subtitle does not limit the powers of the Attorney General and the procedures with respect to consumer fraud.
The Commissioner may issue an order that directs a dental plan organization or its representative to cease and desist from engaging in an act or practice that violates this subtitle.
Within 20 days after service of the cease and desist order, the dental plan organization or its representative may request a hearing to determine whether a violation of this subtitle has occurred.
A hearing under this subsection shall be conducted in accordance with § 2-213 of this article and is subject to judicial review in accordance with § 2-215 of this article.
The Commissioner may bring an action in a court of competent jurisdiction of the State to enjoin a dental plan organization from transacting any further business, or from transferring or disposing of its property, if:
the dental plan organization becomes insolvent or suspends its ordinary business for lack of funds; or
the Commissioner finds, as a result of an examination authorized by this subtitle or in any other manner, that:
the dental plan organization is exceeding its powers or is violating the law;
the condition or methods of business of the dental plan organization may render the continuance of its operations hazardous to enrollees or the public; or
the assets of the dental plan organization are less than its liabilities.
The court may:
proceed in the action in a summary manner or otherwise;
grant injunctive relief and appoint a receiver, with power to:
sue for, collect, receive, take into possession, sell, convey, and assign all the goods and chattels, rights and credits, money and effects, lands and tenement, books, papers, choses in action, bills, notes, and property of every description belonging to the dental plan organization;
authorize the purchase of continuing coverage for enrollees utilizing the remaining assets; and
hold and dispose of any proceeds under the direction of the court; and
cause the receiver to continue the existing operations of the dental plan organization, under court supervision, until the next anniversary of the subscription certificates and contracts then in force.
A dental plan organization is deemed insolvent whenever it is presently or prospectively unable to fulfill its outstanding contracts and maintain the surpluses required under this subtitle.
Except for contracts referred to in § 14-405(b)(5) of this subtitle and complaints filed under § 14-412 of this subtitle, applications, filings, and reports required under this subtitle are public documents and may not be considered confidential.
Except as provided in paragraph (2) of this subsection, information obtained by a dental plan organization about the diagnosis, treatment, or health of an enrollee is confidential and may not be disclosed.
A dental plan organization may disclose information described in paragraph (1) of this subsection:
to the extent that disclosure may be necessary to carry out the purposes of this subtitle;
with the express consent of the enrollee;
under statute or court order for the production or discovery of evidence; or
if the information is pertinent to a claim or in litigation between the enrollee and dental plan organization.
A dental plan organization may claim any statutory privileges against disclosure of information that the dentist who provides the information to the dental plan organization may claim.