28 CA ADC § 1300.43.10
28 CCR s 1300.43.10
Cal. Admin. Code tit. 28, s 1300.43.10
CALIFORNIA CODE OF REGULATIONS
TITLE 28. MANAGED HEALTH CARE
DIVISION 1. THE DEPARTMENT OF MANAGED HEALTH CARE
CHAPTER 2. HEALTH CARE SERVICE PLANS
ARTICLE 1. EXEMPTIONS
This database is current through 06/09/06, Register 2006, No. 23.
s 1300.43.10. Nonprofit Retirees' Plan.
A health care service plan which was registered under the Knox-Mills
Health Plan Act as in effect on June 30, 1976, whose activity as a plan is
limited to reimbursing part or all of the cost of health care services as
a supplement to Medicare (Parts A and B) to persons who were retired from
professions associated with higher learning after having been employed
therein for not less than 10 cumulative years and such persons' spouses,
providing all such persons are enrolled in Medicare, is exempted from the
provisions of Section 1349 of the Knox-Keene Health Care Service Plan Act
of 1975, subject to each of the following conditions:
(a) That such plan is a nonprofit corporation which does not engage,
directly or indirectly, in any for profit business, which is not
affiliated with (Rule 1300.45(c)) a corporation or other entity which
engages, directly or indirectly, in any for profit business, and which
does not contract or otherwise arrange for the performance by persons
other than its directors, officers or employees of any portion of its
administrative or other functions.
(b) That such plan is exempted from federal income tax as an organization
described in Section 501(c)(3) of the Internal Revenue Code and from state
income tax on similar grounds.
(c) That such plan is a charitable corporation subject to, and in
compliance with, the Uniform Supervision of Trustees for Charitable
Purposes Act.
(d) That such plan does not directly provide any health care services
through entity-owned or contracting health facilities or providers.
(e) That such plan has a tangible net equity within the meaning of Section
1300.76(b) of not less than $300,000, including liquid tangible assets in
an amount not less than $300,000, based upon its most recent certified
financial statement (prepared as of a date within the preceding 15 months
and such other date as may be requested by the Director pursuant to
Section 1384 of the Act) and its most recent quarterly and monthly
uncertified statements prepared on a basis consistent with the annual
certified statement, with additional liquid tangible assets in an amount
not less than $1,000 for each person enrolled in excess of 400; provided
that the maximum number of enrollees shall not exceed 500.
(f) That not more than 15% of the total charges paid by or on behalf of
subscribers or enrollees for enrollment in, or for health care benefits
from, such plan is expended for administrative costs, including all costs
of solicitation and enrollment; except that such plan may expend
additional sums of money for administrative costs excluding costs of
solicitation and enrollment provided that such money is not derived from
revenue obtained from subscribers or enrollees.
(g) That such plan issues a uniform health care service plan contract to
all subscribers
(1) which provides, except for a permissible calendar year deductible not
to exceed $100 per enrollee, full coverage for all copayments and
deductibles relating to allowable charges under Medicare (Parts A and B)
for all health care services covered by Medicare (Parts A and B) pursuant
to Title XVIII of the Social Security Act as amended, and not less than
50% of the reasonable charges for each health care service which is not
covered by Medicare but is covered by such plan; provided, however, that
such coverage may be subject to a lifetime limitation allowing not less
than $300,000 of benefits per lifetime and
(2) which provides that an enrollment or subscription may not be cancelled
except upon grounds complying with Section 1365 of the Act.
(h) That such plan provides to each subscriber a disclosure statement
covering the provisions of its health care service plan contract which
complies substantially with the provisions of Section 1363 of the Act and
which also states, if such is the case, that such contract does not cover,
and that subscribers and enrollees will be solely liable for,
(1) any charges in excess of allowable charges under Medicare with respect
to health care services covered by Medicare,
(2) any charges in excess of reasonable charges for any health care
services covered by such plan but not covered by Medicare and any
copayments related to such health care services, and
(3) any permissible plan deductible.
(i) That no less than 75% of the officers and of the directors of such
corporation are persons who are retired from the professions associated
with higher learning after having been employed therein not less than 10
cumulative years, are enrolled in Medicare, and are enrolled in such plan
subject to terms and conditions no more favorable than any other enrollee,
and that no officer or director receives any compensation from such
corporation.
(j) That such plan solicits enrollments or subscriptions in this state
only through persons who are officers or employees of such plan.
(k) That such plan establishes and maintains a grievance procedure
substantially complying with Section 1300.68 of these rules.
( l) That such plan not represent any contract of such plan as a Medicare
supplement contract and discloses to each prospective subscriber and
enrollee when presenting any information regarding the plan, and again at
the time of application, the following written notice:
"THE HEALTH PLAN CONTRACT OFFERED BY (Name of plan) DOES NOT MEET THE
REQUIREMENTS FOR CERTIFICATION AS A MEDICARE SUPPLEMENT CONTRACT PURSUANT
TO APPLICABLE STATE OR FEDERAL LAW, AND HAS NOT BEEN CERTIFIED. PERSONS
DESIRING INFORMATION REGARDING CERTIFIED MEDICARE SUPPLEMENT COVERAGE
SHOULD CONTACT THEIR LOCAL MEDICARE OFFICE."
(m) That such plan delivers to each subscriber and enrollee within 60 days
of the adoption of this section, and annually thereafter, the following
written notice:
"(Name of plan) IS A HEALTH CARE SERVICE PLAN OPERATING PURSUANT TO AN
EXEMPTION FROM THE KNOX-KEENE HEALTH CARE SERVICE PLAN ACT OF 1975.
COMPLAINTS REGARDING THIS PLAN, THE ADMINISTRATION THEREOF, AND THE
SERVICES PROVIDED THEREBY MAY BE DIRECTED TO THE DIRECTOR OF THE
DEPARTMENT OF MANAGED HEALTH CARE OF THE STATE OF CALIFORNIA."
(n) That such plan provides written notice to the Director of its intent
to rely on the exemption provided by this section, executed by a duly
authorized officer of such plan, together with a signed opinion of legal
counsel to the effect that such plan complies with subsections (a), (b),
(c), (d) and (g) of this section.
Note: Authority cited: Sections 1343 and 1344, Health and Safety Code.
Reference: Section 1343, Health and Safety Code.
HISTORY
1. New section filed 11-21-79; effective thirtieth day thereafter
(Register
79, No. 47).
2. Amendment filed 8-12-82; effective thirtieth day thereafter (Register
82,
No. 33).
3. Change without regulatory effect amending subsections (e), (m) and (n)
filed
7-18-2000 pursuant to section 100, title 1, California Code of Regulations
(Register 2000, No. 29).
4. Change without regulatory effect amending subsection (m) filed
11-21-2002
pursuant to section 100, title 1, California Code of Regulations (Register
2002, No. 47).
28 CA ADC s 1300.43.10
END OF DOCUMENT
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