Alabama Administrative Code
Title 482 - ALABAMA DEPARTMENT OF INSURANCE
Chapter 482-1-083 - GOVERNING RULES OF THE ALABAMA HEALTH MAINTENANCE ORGANIZATION GUARANTY ASSOCIATION
Section 482-1-083-.02 - Definitions

(a) ASSOCIATION. The Health Maintenance Organization Guaranty Association created under Section 27-21A-12(i), Code of Ala. 1975.

(b) COMMISSIONER. The Commissioner of Insurance of this state.

(c) CONTRACTUAL OBLIGATION. Any covered health care services owed to an enrollee residing in Alabama and arising from an evidence of coverage issued in the State of Alabama to which this chapter applies, issued or assumed by a member HMO which becomes an insolvent HMO after the effective date of this chapter. A contractual obligation shall not include an amount in excess of $300,000 in the aggregate under one or more evidence(s) of coverage on any one enrollee; nor shall a contractual obligation include any debt or amounts owed by the insolvent HMO to any provider of health care services, or other goods and services except to the extent that any enrollee of the insolvent HMO may be held legally accountable to such provider for the reasonable amount of such debt. The Association shall be not liable for any amount claimed by owners or officers of the insolvent HMO. An amount owed by the insolvent HMO to a provider of health care services whose agreement with the HMO included a "hold-harmless" provision that sought to prevent such provider from looking to the enrollee for payment shall not be a contractual obligation for purposes of this chapter but may be considered a claim against the estate.

(d) COVERED HEALTH CARE SERVICES. Those services provided to the enrollee by the evidence of coverage, including any conditions or limitations on those services, by the insolvent HMO.

(e) ENROLLEE. Any subscriber or covered dependent of an individual who is enrolled in a member health maintenance organization.

(f) EVIDENCE OF COVERAGE. Any contract or certificate of coverage issued to a group or individual, as defined by Section 27-21A-1(5), Code of Ala. 1975, which is required by Section 27-21A-7 and which is within the scope of this chapter and is in force and issued by a member HMO which becomes insolvent after the effective date of this chapter.

(g) HOLD HARMLESS AGREEMENT. The requirement specified in Section 27-21A-3(b)(4) that all contracts for basic health care services contain a provision that providers shall hold the enrollee harmless for the payment of the cost of health care services in any event including, but not limited to, nonpayment of the health maintenance organization, or the health maintenance organizations insolvency.

(h) IMPAIRED HEALTH MAINTENANCE ORGANIZATION. A member health maintenance organization which, after the effective date of this chapter, is not an insolvent health maintenance organization, and (a) is deemed by the Commissioner to be potentially unable to fulfill its contractual obligations and (b) is placed under an order of rehabilitation or conservation by a court of competent jurisdiction.

(i) INSOLVENCY INSURANCE PROTECTION. Those provisions in reinsurance contracts which provide that after the HMO is found to be insolvent the enrollees will have their coverages continued for at least the period of time for which their premiums have been paid, that the plans benefits will be continued for enrollees who are confined in an acute care hospital or skilled nursing facility until their discharge, and that the reinsurer will make available to all enrollees for a period of thirty-one (31) days after the date of insolvency without evidence of insurability replacement health conversion insurance coverage of the same benefit schedule and rates as it is then offering to other prospective insureds within Alabama, as outlined in Chapter 482-1-080. Insolvency insurance protection also includes any agreement between the HMO and an Alabama licensed insurer or nonprofit health service plan under which the insurer or nonprofit health service plan agrees to issue to enrollees in the HMO a plan of hospital, medical and surgical insurance at standard conversion premium rates without any underwriting or other requirement, other than an application and payment of the first monthly premium by the enrollee, in the event the HMO is unable to continue in operation, as required by Chapter 482-1-079.

(j) INSOLVENT HEALTH MAINTENANCE ORGANIZATION. A member HMO which, after the effective date of this Plan, is placed under an order of liquidation by a court of competent jurisdiction with a finding of insolvency.

(k) MEMBER HEALTH MAINTENANCE ORGANIZATION (HMO). Any health maintenance organization authorized by the Commissioner to transact the business of a health maintenance organization in this state to which Section 27-21A-1 et seq., Code of Ala. 1975 applies.

(l) Other terms expressed in this chapter shall have the meanings as defined in Sections 27-21A-1 et seq., Code of Ala. 1975.

Author: Commissioner of Insurance