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Session Laws, 1994
Volume 773, Page 3074   View pdf image
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Ch. 686

1994 LAWS OF MARYLAND

DISINTERESTED BOARD MEMBERS, EVEN IF THE NUMBER OF DISINTERESTED
BOARD MEMBERS CONSTITUTES LESS THAN A QUORUM; AND

3. THE CONTRACT OR TRANSACTION IS FAIR AND
REASONABLE TO THE NONPROFIT HEALTH SERVICE PLAN.

(III) THE NUMBER OF BOARD MEMBERS WHO HAVE COMMON
DIRECTORSHIP OR A FINANCIAL INTEREST MAY BE COUNTED FOR PURPOSES OF A
QUORUM AT THE MEETING OF THE BOARD DURING WHICH THE CONTRACT OR

TRANSACTION IS AUTHORIZED, APPROVED, OR RATIFIED.

(IV) IF A CONTRACT OR TRANSACTION IS NOT AUTHORIZED,
APPROVED, OR RATIFIED AS PROVIDED UNDER THIS PARAGRAPH, THE PERSON
ASSERTING THE VALIDITY OF THE CONTRACT OR TRANSACTION BEARS THE
BURDEN OF PROVING THAT THE CONTRACT OR TRANSACTION IS FAIR AND
REASONABLE TO THE NONPROFIT HEALTH SERVICE PLAN AT THE TIME THE
CONTRACT OR TRANSACTION WAS NOT AUTHORIZED, APPROVED, OR RATIFIED.

(V) THE PROVISIONS OF THIS PARAGRAPH DO NOT APPLY TO THE
FIXING BY THE BOARD OF A REASONABLE COMPENSATION FOR A BOARD MEMBER,
WHETHER AS A DIRECTOR OR IN ANY OTHER CAPACITY.

(VI) 1. ANY PROCEDURE FOR AUTHORIZING, APPROVING, OR
RATIFYING A CONTRACT OR TRANSACTION OF A NONPROFIT HEALTH SERVICE
PLAN TAKEN IN COMPLIANCE WITH THE PROVISIONS OF § 2-418 OF THE
CORPORATIONS AND ASSOCIATIONS ARTICLE SHALL BE DEEMED TO SATISFY THE
REQUIREMENTS OF THIS PARAGRAPH.

2. ANY CHARTER, BYLAW, CONTRACT, OR TRANSACTION
REQUIRING OR PERMITTING INDEMNIFICATION, INCLUDING. ADVANCES OF
EXPENSES, DEVELOPED IN ACCORDANCE WITH THE PROVISIONS OF § 2-
418 OF THE
CORPORATIONS AND ASSOCIATIONS ARTICLE SHALL BE DEEMED TO BE FAIR AND
REASONABLE TO THE NONPROFIT HEALTH SERVICE PLAN.

(c) (1) This subsection does not apply to any board of a nonprofit health service
plan which issues contracts for not more than one of the following services:

. (i)      Chiropodial;

(ii)     Chiropractic;

(iii)    Pharmaceutical;

(iv)    Dental;

(v)     Psychological; or

(vi)    Optometric.

(2) The board shall appoint two additional members to serve as voting
consumer members to the board of a nonprofit health service plan.

- 3074 -

 

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Session Laws, 1994
Volume 773, Page 3074   View pdf image
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