(a)  The director may suspend or revoke any license issued to a health maintenance organization under this chapter if the director finds that any of the following conditions exist:

(1)  The health maintenance organization is operating significantly in contravention of its basic organizational document, or in a manner contrary to that described in and reasonably inferred from any other information submitted under § 27-41-3, unless amendments to those submissions have been filed with and approved by the director;

(2)  The health maintenance organization issues evidence of coverage or uses a schedule of charges for health care services that do not comply with the requirements of § 27-41-8;

(3)  The health maintenance organization does not provide or arrange for basic health care services;

(4)  The health maintenance organization is no longer financially responsible and may reasonably be expected to be unable to meet its obligations to enrollees or prospective enrollees;

(5)  The health maintenance organization has failed to implement a mechanism affording the enrollees an opportunity to participate in matters of policy and operation under § 27-41-6;

(6)  The health maintenance organization has failed to implement the complaint system required by § 27-41-11 in a manner to reasonably resolve valid complaints;

(7)  The health maintenance organization, or any person on its behalf, has advertised or merchandised its services in an untrue, misrepresentative, misleading, deceptive, or unfair manner;

(8)  The continued operation of the health maintenance organization would be hazardous to its enrollees; or

(9)  The health maintenance organization has failed to substantially comply with this chapter.

Terms Used In Rhode Island General Laws 27-41-17

  • Complaint: A written statement by the plaintiff stating the wrongs allegedly committed by the defendant.
  • Director: means the director of the department of business regulation or his or her duly appointed agents. See Rhode Island General Laws 27-41-2
  • Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
  • Health maintenance organization: means a single public or private organization which:

    (1)  Provides or makes available to enrolled participants healthcare services, including at least the following basic healthcare services: usual physician services, hospitalization, laboratory, x-ray, emergency, and preventive services, and out of area coverage, and the services of licensed midwives;

    (2)  Is compensated, except for copayments, for the provision of the basic healthcare services listed in subdivision (1) of this subsection to enrolled participants on a predetermined periodic rate basis; and

    (3)(i)  Provides physicians' services primarily:

    (A)  Directly through physicians who are either employees or partners of the organization; or

    (B)  Through arrangements with individual physicians or one or more groups of physicians organized on a group practice or individual practice basis;

    (ii)  "Health maintenance organization" does not include prepaid plans offered by entities regulated under chapter 1, 2, 19, or 20 of this title that do not meet the criteria above and do not purport to be health maintenance organizations;

    (4)  Provides the services of licensed midwives primarily:

    (i)  Directly through licensed midwives who are either employees or partners of the organization; or

    (ii)  Through arrangements with individual licensed midwives or one or more groups of licensed midwives organized on a group practice or individual practice basis. See Rhode Island General Laws 27-41-2

  • person: may be construed to extend to and include co-partnerships and bodies corporate and politic. See Rhode Island General Laws 43-3-6

(b)  The director of business regulation shall suspend or revoke any license issued to a health maintenance organization upon certification by the director of health to the director of business regulation that:

(1)  The health maintenance organization does not meet the requirements of § 27-41-4(a)(2); or

(2)  The health maintenance organization is unable to fulfill its obligations to furnish health care services.

(c)  A license shall be suspended or revoked only after compliance with the requirements of § 27-41-20.

(d)  When the license of a health maintenance organization is suspended, the health maintenance organization shall not, during the period of that suspension, enroll any additional enrollees except newborn children or other newly acquired dependents of existing enrollees, and shall not engage in any advertising or solicitation.

(e)  When the license of a health maintenance organization is revoked, the organization shall proceed, immediately following the effective date of the order of revocation, to wind up its affairs, and shall conduct no further business except as may be essential to the orderly conclusion of the affairs of the organization. It shall engage in no further advertising or solicitation. The director of business regulation may, by written order, permit any further operation of the organization that the director may find to be in the best interest of enrollees, to the end that enrollees will be afforded the greatest practical opportunity to obtain continuing health care coverage.

History of Section.
P.L. 1983, ch. 225, § 2; P.L. 1989, ch. 542, § 85.