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Ch. 323 2000 LAWS OF MARYLAND
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SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take
effect June 1, 2000.
Approved May 11, 2000.
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CHAPTER 323
(House Bill 5)
AN ACT concerning
Health Maintenance Organizations - Responsibility for and Regulation of
Downstream Risk Assumption Contracts—Member and Provider Protection
FOR the purpose of requiring health maintenance organizations and certain other
entities that enter into administrative service provider contracts and
downstream risk assumption contracts to meet certain requirements; clarifying
the responsibility of certain health maintenance organizations for certain claims
and payments for health care services under an administrative service provider
contract; specifying that certain requirements concerning administrative service
provider contracts and downstream risk assumption contracts apply to managed
care organizations under the Maryland Medical Assistance Program; requiring
the Insurance Commissioner to consult with the Secretary of Health and Mental
Hygiene before taking certain action; authorizing the Maryland Insurance
Commissioner to impose a certain additional penalty on a health maintenance
organization; making the provisions of this Act applicable to certain provider
sponsored organizations under certain circumstances; specifying that certain
provisions of law apply to a licensed health services contractor and officers,
directors, and trustees of a licensed health services contractor; requiring the
Commissioner, in consultation with the Secretary of Health and Mental
Hygiene, to adopt certain regulations for a certain methodology; specifying that
certain provisions of law apply to a certain contract; providing for a certain
exemption; prohibiting a health maintenance organization from entering into a
downstream risk assumption contract with a person unless the person is a
licensed health services contractor; prohibiting a licensed health services
contractor from entering into a downstream risk assumption contract with
another licensed health services contractor under certain circumstances;
specifying the application content and requirements for an applicant for
licensure as a health services contractor; specifying certain additional
information to be submitted to the Commissioner by an applicant for licensure
as a health services contractor; requiring an applicant for licensure as a health
services contractor to satisfy the Commissioner that the applicant has a certain
capacity and will meet certain requirements; requiring the Commissioner to
establish and adopt by regulation certain minimum capital and surplus
requirements for licensed health services contractors, certain requirements for
an insolvency plan, and certain requirements for the creation of a segregated
fund or availability of certain resources; authorizing the Commissioner to
require that a health maintenance organization and a licensed health services
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