(1) A hospital service corporation shall enter into service agreements with only hospitals duly approved or licensed by the state of Idaho.
(2)  Each such service agreement shall require the participant hospital to furnish to subscribers of the service corporation the hospital services which are, under the subscriber’s contract, to be furnished by participant hospitals; and this obligation so to furnish such service, as provided for in the subscriber’s contract, shall be a direct obligation of the participant hospitals to the subscribers as well as to the service corporation.

Terms Used In Idaho Code 41-3416

  • 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.
  • Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
  • State: when applied to the different parts of the United States, includes the District of Columbia and the territories; and the words "United States" may include the District of Columbia and territories. See Idaho Code 73-114
(3)  Each such service agreement shall further effectively in substance provide that:
(a)  The participant hospital shall be compensated for services rendered to a subscriber in accordance with a schedule of charges contained in the agreement or attached to and made a part of the agreement, and that the hospital shall not request or receive from the service corporation any compensation for such services which is not in accord with such schedule.
(b)  Compensation for services may be prorated and settled under the circumstances and in the manner referred to in section 41-3431.
(c)  If the participant hospital withdraws from the agreement, such withdrawal shall not be effective as to any subscriber’s contract in force on the date of such withdrawal until the termination of the subscriber’s contract or the next following anniversary of the subscriber’s contract, whichever date is the earlier.
(4)  The service corporation shall terminate the service agreement as to a particular participant hospital, in addition to other bases of termination provided for in the agreement, if it is determined that the hospital has knowingly charged or attempted to charge the service corporation for any service not actually rendered, or has knowingly violated any material provision of the service agreement.
(5)  The proposed form of any such service agreement and of any standard riders and endorsements thereto shall be filed with the director and be subject to his approval, as provided in section 41-3419.