Ch. 388

LAWS OF MARYLAND

SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF
MARYLAND, That the Laws of Maryland read as follows:

Article - Health - General

19-701.

(e) "Health maintenance organization" means any person,
including a profit or nonprofit corporation organized under the
laws of any state or country, that:

(1)  Operates or proposes to operate in this State;

(2)  Except as provided in § 19-703(b) of this
subtitle with respect to hospitalization services, provides or
otherwise makes available to its members health care services
that include at least physician, hospitalization, laboratory,
X-ray, emergency, and preventive services, out-of-area coverage,
and any other health care services that the Commissioner
determines to be available generally on an insured or prepaid
basis in the area serviced by the health maintenance
organization, and, at the option of the health maintenance
organization, may provide additional coverage;

(3)  Except for any copayment or deductible
arrangement, is compensated only on a predetermined periodic rate
basis for providing to members the minimum services that are
specified in item (2) of this subsection;

(4)  Assures its subscribers and members, the
Commissioner, and the Department that one clearly specified legal
and administrative focal point or element of the health
maintenance organization has the responsibility of providing the
availability, accessibility, quality, and effective use of
comprehensive health care services; and

(5)  Primarily provides services of physicians:

(i) Directly through physicians who are either
employees or partners of the health maintenance organization; or

(ii) Under arrangements with one or more groups
of physicians, who are organized on a group practice or
individual practice basis, under which each group:

1.  Is compensated for its services
primarily on the basis of an aggregate fixed sum or on a per
capita basis; and

2.  Is provided with an effective
incentive to avoid unnecessary inpatient use, whether the
individual physician members of the group are paid on a
fee-for-service or other basis.

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