The department shall have authority to amend a prepaid health plan contract in accordance with the terms of a merger of a prepaid health plan with another organization or organizations other than the plan’s subsidiary corporation, its parent corporation, or another subsidiary of its parent corporation, provided the surviving organization meets the following conditions:

(a) The surviving organization assures the continued and accessible delivery of health care services to enrollees.

Terms Used In California Welfare and Institutions Code 14303.1

  • Contract: A legal written agreement that becomes binding when signed.
  • Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.

(b) The plans concerned have satisfactorily demonstrated the fiscal and administrative soundness of the newly proposed organization.

(c) The enrollees of the plans concerned are informed of the impending merger, any resulting changes in the service area or delivery of health care services, and such other information required by subdivision (a) of Section 14406 at least 30 days in advance of the merger.

(d) The enrollees of the plans concerned are given the option of disenrolling for any cause within 60 days following the effective date of the merger.

(e) Public notice is given and if necessary a public hearing is held as required by Section 14300.

(f) The organization meets such other requirements as deemed necessary by the department in order to carry out the purpose of this chapter.

(Amended by Stats. 1980, Ch. 1073, Sec. 4.)

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