(a) The department may require a prepaid limited health service organization to submit any contract for administrative services, contract with a provider physician, contract for management services, or contract with an affiliated entity to the department if the department has information that the prepaid limited health service organization has entered into a contract that requires it to pay a fee that is unreasonably high in relation to the service provided.

Terms Used In Tennessee Code 56-51-129

  • Contract: A legal written agreement that becomes binding when signed.
  • Department: means the department of commerce and insurance. See Tennessee Code 56-51-102
  • Limited health service: means dental care services, vision care services, mental health services, substance abuse services, and pharmaceutical services. See Tennessee Code 56-51-102
  • Prepaid limited health service organization: means any person, corporation, partnership, or any other entity that, in return for a prepayment from a health maintenance organization or a state or federal agency, undertakes to provide or arrange for, or provide access to, the provision of a limited health service to enrollees through an exclusive panel of providers. See Tennessee Code 56-51-102
  • Provider: means , but is not limited to, any physician, dentist, health facility, or other person or institution that is duly licensed in this state to deliver limited health services. See Tennessee Code 56-51-102
(b) After review of a contract, the department may order the prepaid limited health service organization to cancel the contract if it determines that the fees to be paid by the prepaid limited health service organization under the contract are so unreasonably high as compared with similar contracts entered into by the prepaid limited health service organization in similar circumstances that the contract is detrimental to the subscribers, stockholders, investors, or creditors of the prepaid limited health service organization.
(c) All contracts for administrative services, management services, or provider services or contracts with affiliated entities, entered into or renewed by a prepaid limited health service organization, must contain a provision that the contract will be cancelled upon issuance of an order by the department pursuant to this section.
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