Current through Register Vol. 43, No. 02, November 27, 2024
(1) The
Plan shall operate subject to the supervision and control of a Board of
Directors. The Board, which shall be the Plan Administrator, shall consist of
the Commissioner, or his or her designated representative, who shall serve as
an ex officio member of the Board and shall be its chairman, and eight members
appointed by the Commissioner. At least two (2) Board members shall be
individuals not representing insurers or health care providers. At least two
(2) Board members shall be representatives of insurers.
(2) The initial Board members shall be
appointed as follows: two members to serve a term of one (1) year; three
members to serve a term of two (2) years; and three members to serve a term of
three (3) years. Subsequent Board members shall serve for a term of three (3)
years. A Board member's term shall continue until his or her successor is
appointed.
(3) Vacancies in the
Board shall be filled by the Commissioner. Board members may be removed by the
Commissioner for cause.
(4) Board
members shall not be compensated in their capacity as Board members but may be
reimbursed for reasonable expenses incurred in the necessary performance of
their duties.
(5) The Board shall
submit to the Commissioner a plan of operation for the Plan and any amendments
thereto necessary or suitable to assure the fair, reasonable and equitable
administration of the Plan. The plan of operation shall become effective upon
approval in writing by the Commissioner consistent with the date on which the
coverage under this Plan must be made available. If the Board fails to submit a
suitable plan of operation within 180 days after the appointment of the Board
of directors, or at any time thereafter fails to submit suitable amendments to
the plan of operation, the Commissioner shall adopt and promulgate such rules
as are necessary or advisable to effectuate the provisions of this rule. Such
rules shall continue in force until modified by the Commissioner or superseded
by a plan of operation submitted by the Board and approved by the
Commissioner.
(6) The plan of
operation shall include, but not be limited to, the following:
(a) Procedures for Board meetings.
(b) Procedures for operation of the
Plan.
(c) Procedures for selecting
an Operations Administrator and a Claims Administrator or
Administrators.
(d) Procedures to
create a fund, under management of the Board, for administrative
expenses.
(e) Procedures for
premium and assessment billings.
(f) Procedures for the managing, accounting
and auditing of assets, monies and claims of the Plan.
(g) Procedures to publicize the existence of
the Plan, the eligibility requirements, and procedures for enrollment; and to
maintain public awareness of the Plan.
(h) Procedures under which applicants and
participants may have grievances reviewed by a grievance committee appointed by
the Board.
(i) Procedures for other
matters as may be necessary and proper for the execution of the Board's powers,
duties and obligations under this chapter.
(7) In accordance with Section
27-52-2, the Plan shall have the
general powers and authority granted under the laws of this state to health
insurers and in addition thereto, the specific authority to do all of the
following:
(a) Enter into contracts as are
necessary or proper to carry out the provisions and purposed of this chapter,
including the authority, with the approval of the Commissioner, to enter into
contracts with similar plans of other states for the joint performance of
common administrative functions, or with persons or other organizations for the
performance of administrative functions.
(b) Sue or be sued, including taking any
legal actions necessary or proper to recover or collect assessments due the
Plan.
(c) Take such legal action as
necessary to do any of the following:
1. To
avoid the payment of improper claims against the Plan or the coverage provided
by or through the Plan.
2. To
recover any amounts erroneously or improperly paid by the Plan.
3. To recover any amounts paid by the Plan as
a result of mistake of fact or law.
4. To recover other amounts due the
Plan.
(d) Establish, and
modify from time to time as appropriate, premiums, premium schedules, premium
adjustments, expense allowances, claim reserve formulas and any other actuarial
function appropriate to the operation of the Plan. Premiums and premium
schedules may be adjusted for appropriate factors such as age, sex and
geographic variation in claim cost and shall take into consideration
appropriate factors in accordance with established actuarial and underwriting
practices.
(e) Issue policies of
insurance in accordance with the requirements of the Act and this
chapter.
(f) Appoint appropriate
legal, actuarial and other committees as necessary to provide technical
assistance in the operation of the Plan, policy and other contract design, and
any other function within the authority of the plan.
(g) Borrow money to effect the purposes of
the Plan. Any notes or other evidence of indebtedness of the Plan not in
default shall be legal investments for insurers and may be carried as admitted
assets.
(h) Establish rules,
conditions and procedures for participating insurers desiring to issue plan
coverages in their own name.
(i)
Employ and fix the compensation of employees.
(j) Prepare and distribute certificate of
eligibility forms and enrollment instruction forms to insurance producers and
to the general public.
(k) Provide
for reinsurance of risks incurred by the Plan.
(l) Issue additional types of health
insurance policies to provide optional coverages.
(m) Provide for and employ cost containment
measures and requirements including, but not limited to, preadmission
screening, second surgical opinion, concurrent utilization review, and
individual case management for the purpose of making the benefit plan more cost
effective.
(n) Design, utilize,
contract or otherwise arrange for the delivery of cost effective health care
services, including establishing or contracting with preferred provider
organizations, health maintenance organizations and other limited network
provider arrangements.
(o) Adopt
bylaws, policies and procedures as may be necessary or convenient for
implementation of the Act and the operation of the Plan.
(8) The Board shall make an annual report to
the Commissioner. The report shall summarize the activities of the Plan in the
preceding calendar year, including the net written and earned premiums, Plan
enrollment, the expense of administration, and the paid and incurred
losses.
(9) Neither the Board nor
its employees shall be liable for any obligations of the Plan. No member or
employee of the Board shall be liable, and no cause of action of any nature may
arise against them, for any act or omission related to the performance of their
powers and duties under the Plan, unless such act or omission constitutes
willful or wanton misconduct. The Board may provide in its bylaws or rules for
indemnification of, and legal representation for, its members and employees.
Author: Elizabeth Bookwalter, Associate
Counsel
Statutory Authority:
Code of Ala.
1975, §§
27-2-17,
27-52-1,
et
seq.
