§ 36-6538. Administering insurer.

A.  The Board of Directors of the Health Insurance High Risk Pool shall select an administering insurer who shall be an insurer as defined in this act, through a competitive bidding process, to administer the plan.  The Board shall evaluate the bids submitted under this subsection based on criteria established by the Board, which criteria shall include, but not be limited to, the following:

1.  The administering insurer's proven ability to handle large group accident and health insurance policies and claims;

2.  The efficiency of the administering insurer's claims-paying procedures; and

3.  An estimate of total charges for administering the plan.

B.  The administering insurer shall serve for a period of up to five (5) years.  At least one (1) year prior to the expiration of each contract period of service by an administering insurer, the Board shall invite all reasonably interested potential administering insurers, including the current administering insurer, to submit bids to serve as the administering insurer for the succeeding contract period.  The selection of the administering insurer for the succeeding contract period shall be made at least six (6) months prior to the end of the current contract period.  The Board may terminate the service of the administering insurer at any time if the Board determines that the administering insurer has failed to perform their duties effectively according to the contract established or for other good cause as determined by the Board.  In this case, the Board will accept bids from other potential administering insurers to serve the remainder of the vacated term.

C.  The Board may select more than one administering insurer to perform the different functions involved in administering the plan.

D.  The administering insurer shall:

1.  Perform all eligibility and administrative claims-payment functions relating to the plan;

2.  Pay an agent's referral fee as established by the Board to each agent who refers an applicant to the plan, if the applicant is accepted.  The selling or marketing of the plan shall not be limited to the administering insurer or its agents.  The referral fees shall be paid by the administering insurer from moneys received as premiums for the plan;

3.  Establish a premium billing procedure for collection of premiums from persons insured under the plan;

4.  Perform all necessary functions to assure timely payment of benefits to covered persons under the plan, including, but not limited to, the following:

a.making available information relating to the proper manner of submitting a claim for benefits under the plan and distributing forms upon which submissions shall be made,

b.evaluating the eligibility of each claim for payment under the plan, and

c.notifying each claimant within thirty (30) days after receiving a properly completed and executed proof of loss, whether the claim is accepted, rejected, or compromised;

5.  Submit regular reports to the Board regarding the operation of the plan.  The frequency, content, and form of the reports shall be determined by the Board;

6.  Following the close of each calendar year, determine net premiums, reinsurance premiums less administrative expenses allowance, the expense of administration pertaining to the reinsurance operations of the Pool, and the incurred losses for the year, and report this information to the Board and to the Insurance Commissioner;

7.  Pay claims expenses from the premium payments received from, or on behalf of, covered persons under the plan.  If the payments by the administering insurer for claims expenses exceed the portion of premiums allocated by the Board for the payment of claims expenses, the Board shall provide through assessment the additional funds necessary for payment of claims expenses; and

8.  Conduct bill review to check for appropriate coding, duplication, excessive charges and billing errors.

E.  1.  The administering insurer shall be paid, as provided in the contract of the Pool, for direct and indirect expenses incurred in administering the Pool.

2.  As used in this subsection, the term "direct and indirect expenses" includes the portion of the audited administrative costs, printing expenses, claims administration expenses, management expenses, building overhead expenses and other actual operating and administrative expenses of the administering insurer which are approved by the Board as allocable to the administration of the plan and included in the bid specifications.

Added by Laws 1995, c. 250, § 8, eff. July 1, 1995.  Amended by Laws 1996, c. 249, § 6, emerg. eff. May 28, 1996; Laws 2002, c. 439, § 5, eff. July 1, 2002; Laws 2008, c. 404, § 4, emerg. eff. June 3, 2008.

Note

NOTE:  Laws 1996, c. 246, § 23 repealed by Laws 1996, c. 249, § 9, emerg. eff. May 28, 1996.