Ch. 357                                    2003 LAWS OF MARYLAND

14-111.

[A] SUBJECT TO THE AUTHORITY OF THE COMMISSIONER TO REGULATE
NONPROFIT HEALTH SERVICE PLANS UNDER THIS ARTICLE, A certificate of authority
issued under this subtitle authorizes a corporation to:

(1)     issue contracts in the form filed with the Commissioner to persons
that become subscribers to the plan;

(2) FINANCE CAPITAL IMPROVEMENT PROJECTS THROUGH THE
MARYLAND HEALTH AND HIGHER EDUCATIONAL FACILITIES AUTHORITY AS
PROVIDED UNDER ARTICLE 43C OF THE CODE;

(3) FINANCE CAPITAL IMPROVEMENT PROJECTS THROUGH THE
MARYLAND ECONOMIC DEVELOPMENT CORPORATION AS PROVIDED UNDER
ARTICLE 83A, TITLE 5, SUBTITLE 2 OF THE CODE; AND

(4) PARTNER WITH THE STATE AND OTHER PUBLIC OR PRIVATE
ENTITIES TO PROVIDE SERVICES OR ADMINISTER PROGRAMS INTENDED TO
ADDRESS COMMUNITY HEALTH CARE NEEDS.

14-115.

(a) (1) In this section the following words have the meanings indicated.

(2)     "Board" means the board of directors of a nonprofit health service
plan.

(3)     "Immediate family member" means a spouse, child, child's spouse,
parent, spouse's parent, sibling, or sibling's spouse.

(b) [Subsections (c) through (f) of this section apply] THIS SECTION APPLIES
to a nonprofit health service plan that is [incorporated under the laws of the State and
operates under a certificate of authority issued by the Commissioner under this
subtitle] ISSUED A CERTIFICATE OF AUTHORITY IN THE STATE, WHETHER OR NOT
ORGANIZED UNDER THE LAWS OF THIS STATE.

(c) (1) The business and affairs of a nonprofit health service plan shall be
managed under the direction of a board of directors.

(2) The board and its individual members are fiduciaries and shall act:

(i) in good faith;

(ii) in a manner that is reasonably believed to be in the best interests
of the corporation AND ITS CONTROLLED AFFILIATES OR SUBSIDIARIES THAT OFFER
HEALTH BENEFIT PLANS; [and]

(III) IN A MANNER THAT IS REASONABLY BELIEVED TO BE IN
FURTHERANCE OF THE CORPORATION'S NONPROFIT MISSION; AND

[(iii)] (IV) with the care that an ordinarily prudent person in a like
position would use under similar circumstances.

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