Missouri Revised Statutes

354.010. As used in sections 354.010 to 354.380, unless the context clearly indicates otherwise, the following terms mean:

(1) "Corporation", a domestic health services corporation subject to the provisions of sections 354.010 to 354.380;

(2) "Director", the director of the department of insurance of the state of Missouri;

(3) "Health services", the health care and services provided by hospitals, or other health care institutions, organizations, associations or groups, and by doctors of medicine, osteopathy, dentistry, chiropractic, optometry and podiatry, nursing services, medical appliances, equipment and supplies, drugs, medicines, ambulance services, and other therapeutic services and supplies;

(4) "Health services corporation", any not-for-profit corporation heretofore or hereafter organized or operating for the purposes of establishing and operating a nonprofit plan or plans under which prepaid hospital care, medical-surgical care and other health care and services, or reimbursement therefor, may be furnished to a member or beneficiary;

(5) "Member" or "beneficiary", a natural person who is entitled to receive health services, or reimbursement therefor, pursuant to a contract made by a health services corporation with or for the benefit of such person;

(6) "Membership contract", any agreement, contract or certificate by which a health services corporation describes the health services or benefits to be provided thereunder to its members or beneficiaries;

(7) "Not-for-profit corporation", a nonprofit domestic corporation organized under or accepting the provisions of chapter 355, RSMo, or incorporated under chapter 352, RSMo.

(L. 1973 S.B. 3 § 1, A.L. 1983 H.B. 127)

354.015. All health services corporations heretofore or hereafter organized shall be subject to the provisions of sections 354.010 to 354.380, to the provisions of the other laws of this state which are specifically designated in sections 354.010 to 354.380, and to the provisions of any other laws of this state relating to insurance which specifically state they shall apply to health services corporations. The provisions of this act* shall not apply to any labor organization's health plan providing services established and maintained solely for its members and their dependents, and facilities of not-for-profit corporations in existence on October 1, 1980, subject either to the provisions and regulations of section 302 of the Labor-Management Relations Act, 29 U.S.C. 186 or the Labor-Management Reporting and Disclosure Act, 29 U.S.C. 401-538.

(L. 1973 S.B. 3 § 2, A.L. 1981 S.B. 185, A.L. 1983 H.B. 127)

*"This act" (H.B. 127, 1983) contained numerous sections. Consult Disposition of Sections table for a definitive listing.

(1985) The provisions of this section which are in irreconcilable conflict with the provisions of section 375.947, RSMo, are held to be impliedly repealed. The health services corporation may not refuse reimbursement for treatment of a covered illness or injury merely because the health care provider was a chiropractor. Klinginsmith v. Mo. Dept. of Consumer Affairs (A.), 693 S.W.2d 226.

354.020. 1. Any health services corporation heretofore organized under the provisions of either chapter 352 or chapter 355, RSMo, shall amend its articles of incorporation to comply with the provisions of sections 354.010 to 354.380 for organization, and for issuance of a certificate of incorporation and of a certificate for authority to do business.

2. After completion of the actions provided in subsection 1 and the issuance of the required certificates, the corporation shall be a corporation organized under sections 354.010 to 354.380 and shall be entitled to all the rights, privileges and benefits and shall be subject to all the obligations, duties and liabilities provided in sections 354.010 to 354.380.

(L. 1973 S.B. 3 § 3, A.L. 1983 H.B. 127)

354.025. A health services corporation may be organized for the purposes of establishing and operating a voluntary, nonprofit plan or plans under which hospital care, medical-surgical care, and other health care and services, or reimbursement therefor, may be furnished to persons who become members or beneficiaries; of acting as agent or intermediary for other health services corporations, for any governmental body or agency, or for other corporations, associations, partnerships or individuals in the field of health care and services; and of research, education or related activity to further objects within the purview of sections 354.010 to 354.380.

(L. 1973 S.B. 3 § 4, A.L. 1983 H.B. 127)

354.027. A health services corporation which provides its members or beneficiaries with coverage for certain services, or reimbursement therefor, shall provide such coverage or reimbursement in all situations in which the covered service is performed by a person duly licensed to perform such service. No health services corporation may discriminate in its coverage or reimbursement amounts for covered services among persons duly licensed to provide such covered services. The provisions of this section shall not apply to any federally qualified health maintenance organization. This section shall apply to all contracts issued or renewed on or after January 1, 1984. This section shall apply only to persons duly licensed as physicians, surgeons, optometrists, chiropractors, dentists, psychologists, pharmacists, pharmacies, or podiatrists, as defined by and in accordance with the statutes of the state of Missouri.

(L. 1983 H.B. 127, A.L. 1993 H.B. 709)

354.030. No group, association or organization created for or engaged in business or activity for profit, provision for the incorporation of which is made by any of the corporation laws of this state, shall be organized or operate, directly or indirectly, as a health services corporation under sections 354.010 to 354.380.

(L. 1973 S.B. 3 § 5, A.L. 1983 H.B. 127)

354.035. A health services corporation may be organized in the manner provided for the organization of a general not-for-profit corporation in chapter 355, RSMo, by filing articles of incorporation in triplicate in the office of the secretary of state. One copy of the articles of incorporation shall be forwarded by the secretary of state to the director. If the secretary of state finds that the purposes stated in the articles of incorporation are within the purview of, and limited to the purposes authorized by, section 354.025, and that such articles otherwise conform to law, he shall, when all fees and charges have been paid, file one of such triplicate originals in his office and issue a certificate of incorporation to which he shall affix the other triplicate original. The certificate of incorporation and copy of articles of incorporation shall be delivered by the secretary of state to the incorporators.

(L. 1973 S.B. 3 § 6, A.L. 1983 H.B. 127)

354.040. In addition to the contents required or permitted by chapter 355, RSMo, the articles of incorporation of a health services corporation shall comply with the following:

(1) The name of the corporation shall not include the words "insurance", "casualty", "surety", "mutual", or any other words descriptive of the insurance, casualty or surety business;

(2) The corporate name of any corporation to be formed under sections 354.010 to 354.380 shall not be the same as, or deceptively similar to, the name of any other corporation authorized to do business in this state;

(3) The statement of purposes shall be in conformity with the provisions of sections 354.010 to 354.380;

(4) Any such corporation organized prior to September 28, 1973, whose existing articles of incorporation shall not be in substantial conformity with sections 354.010 to 354.380, shall adopt and file, as provided in sections 354.010 to 354.380, such amendments to its articles as are necessary to effect substantial compliance with sections 354.010 to 354.380.

(L. 1973 S.B. 3 § 7, A.L. 1983 H.B. 127)

354.045. Upon the issuance of the certificate of incorporation by the secretary of state, the corporate existence shall begin, and such certificate of incorporation shall be conclusive evidence, except against the state, that all conditions precedent required to be performed by the incorporators have been complied with and that the corporation has been incorporated under sections 354.010 to 354.380.

(L. 1973 S.B. 3 § 8, A.L. 1983 H.B. 127)

354.050. The corporation shall have all the powers, rights and privileges of a corporation organized under chapter 355, RSMo, except insofar as such provisions are inconsistent with the provisions of sections 354.010 to 354.380, but it shall not commence its business or operations until it receives authority to do so from the director of insurance, as provided in section 354.055.

(L. 1973 S.B. 3 § 9, A.L. 1983 H.B. 127)

354.055. No corporation subject to the provisions of this chapter shall commence operations or transact any business in this state unless it shall first procure from the director of insurance a certificate of authority stating that the requirements of the laws of this state have been complied with and authorizing it to do business. The certificate of authority shall expire on the last day of June in each year, but shall be extended automatically pending formal renewal by the director, if the corporation has continued to comply with the provisions of sections 354.010 to 354.380 and of the laws of this state.

(L. 1973 S.B. 3 § 10, A.L. 1983 H.B. 127)

354.060. 1. The director of the department of insurance shall determine that all the requirements of sections 354.010 to 354.380 for commencement of business have been complied with, and upon such determination shall issue to the corporation a certificate of authority to do business as a health services corporation under sections 354.010 to 354.380.

2. The director shall not issue or renew his certificate of authority to any corporation operating or proposing to operate under the provisions of sections 354.010 to 354.380, unless such corporation shall be in compliance with all the requirements of sections 354.010 to 354.380.

(L. 1973 S.B. 3 § 11, A.L. 1983 H.B. 127)

354.065. A corporation may amend its articles of incorporation from time to time in the manner provided in chapter 355, RSMo, and shall file a duly certified copy of its certificate of amendment with the director of insurance within twenty days after the issuance of the certificate of amendment by the secretary of state. Upon the issuance of the certificate of amendment by the secretary of state, the amendment shall become effective and the articles of incorporation shall be deemed to be amended accordingly.

(L. 1973 S.B. 3 § 12, A.L. 1998 S.B. 680, A.L. 1999 S.B. 1, et al., A.L. 2000 S.B. 896, A.L. 2007 S.B. 613 Revision)

354.070. When the annual statement of a corporation subject to the provisions of sections 354.010 to 354.380 is filed and all fees due from the corporation are tendered, the corporation's certificate of authority to do business in this state shall automatically be extended pending formal renewal by the director, or until such time as he should refuse to renew the certificate.

(L. 1973 S.B. 3 § 13, A.L. 1983 H.B. 127)

354.075. No corporation subject to the provisions of sections 354.010 to 354.380 shall be permitted to do business in this state unless it shall have a paid-in capital or guaranty fund of not less than one hundred and fifty thousand dollars, in addition to the reserves required in sections 354.010 to 354.380. The surplus and guaranty fund shall be placed and held on joint deposit with the director for the protection of all subscribers, members and beneficiaries.

(L. 1973 S.B. 3 § 14, A.L. 1983 H.B. 127)

354.080. The corporation shall maintain at all times reserves adequate to provide the hospital, medical-surgical and other health services made available to its members and beneficiaries and to meet all its costs and expenses. The reserves shall not be less than an amount equal to two months of benefit payments and administrative expenses, based on an average of the preceding twelve months, or if the reserves are not equal to such average, they must have been increased during the preceding twelve months by an amount equal to one percent of the gross dues income during such period. The determination of minimum reserves hereunder shall be subject, as to amounts payable to participating providers of the health services, to any right of the corporation to prorate the amounts under the terms of its health service contracts with providers. The director may decrease or suspend the requirements of this section if he finds that such action would be in the best interest of the members of the corporation.

(L. 1973 S.B. 3 § 15)

354.085. No corporation subject to the provisions of sections 354.010 to 354.380 shall deliver or issue for delivery in this state a form of membership contract, or any endorsement or rider thereto, until a copy of the form shall have been approved by the director. The director shall not approve any policy forms which are not in compliance with the provisions of sections 354.010 to 354.380 of this state, or which contain any provision which is deceptive, ambiguous or misleading, or which do not contain such words, phraseology, conditions and provisions which are specific, certain and reasonably adequate to meet needed requirements for the protection of those insured. If a policy form is disapproved, the reasons therefor shall be stated in writing; a hearing shall be granted upon such disapproval, if so requested; provided, however, that such hearing shall be held no sooner than fifteen days following the request. The failure of the director of insurance to take action approving or disapproving a submitted policy form within forty-five days from the date of filing shall be deemed an approval thereof. The director shall not disapprove any deemed policy form for a period of twelve months thereafter. If at any time during that twelve-month period the director determines that any provision of the deemed policy form is contrary to state law, the director shall notify the health services corporation of the specific provision that is contrary to state law, and any specific statute to which the provision is contrary to, and request that the health services corporation file, within thirty days of receipt of the request, an amendment form that modifies the provision to conform to state law. Upon approval of the amendment form by the director, the health services corporation shall issue a copy of the amendment to each individual and entity to which the deemed policy form was previously issued and shall attach a copy of the amendment to the deemed policy form when it is subsequently issued. Such amendment shall have the force and effect as if the amendment was in the original filing or policy. The director of insurance shall have authority to make such reasonable rules and regulations concerning the filing and submission of such policy forms as are necessary, proper or advisable.

(L. 1973 S.B. 3 § 16, A.L. 1983 H.B. 127, A.L. 2003 H.B. 121)

354.090. 1. A corporation subject to the provisions of sections 354.010 to 354.380 may enter into contracts for the rendering of hospital services, medical-surgical services and other health services on behalf of its members or beneficiaries with hospitals maintained by any governmental body or agency, or maintained by a nonprofit corporation organized for hospital purposes, or with other corporations, organizations, associations, partnerships or individuals furnishing hospital services, medical-surgical services, or other health services. Any health services corporation may enter into agreements or contracts with other organizations or corporations licensed to do business in this state or in any other state for the transfer of members or beneficiaries, for the reciprocal joint provisions of benefits to the members or beneficiaries of the corporation and of such other organizations or corporations, or for such other joint undertakings as the corporation's board of directors may approve.

2. In lieu of direct payment from an insured for goods or services furnished, a pharmacist may take an assignment of such insured's right to reimbursement for those goods or services provided to a member of a health services corporation. No health services corporation may refuse to pay the pharmacist any payment due the insured under the terms of the policy or contract.

(L. 1973 S.B. 3 § 17, A.L. 1983 H.B. 127)

354.095. 1. A corporation subject to the provisions of sections 354.010 to 354.380 may, in the discretion of its board of directors, limit or define the classes of persons who shall be eligible to become members or beneficiaries, limit and define the benefits which it will furnish, and may define such benefits as it undertakes to furnish into classes or kinds. It may make available to its members or beneficiaries such health services, or reimbursement therefor, as the board of directors of any such corporation may approve; if maternity benefits are provided to any members of any plan, then maternity benefits shall be provided to any member of such plan without discrimination as to whether the member is married or unmarried, and if maternity benefits are provided to a beneficiary of any plan, then maternity benefits shall be provided to such beneficiary of such plan without discrimination as to whether the beneficiary is married or unmarried.

2. If an ambulatory surgical facility as defined by subdivision (1) of section 197.200, RSMo, has received a certificate of need as provided in chapter 197, RSMo, a health services corporation shall provide benefits to the facility on the same basis as it does to all other health care facilities, whether contracting members or noncontracting members. A health services corporation shall use the same standards that are applied to any other health care facility within the same health services area in defining the benefits that the corporation will furnish to the ambulatory surgical facility, the classes to which such benefits will be furnished, and the amount of reimbursement.

(L. 1973 S.B. 3 § 18, A.L. 1981 S.B. 185, A.L. 1983 H.B. 127)

354.105. All corporations subject to the provisions of sections 354.010 to 354.380 shall make and file annually with the director on or before the first day of March of each year a report under oath upon a form to be prescribed by the director setting forth:

(1) The name of the corporation;

(2) The address of its registered office in this state and the name of its registered agent at such address;

(3) The names and addresses of its directors and officers;

(4) A brief statement of the character of the affairs which the corporation is actually conducting;

(5) The amount of all dues or fees collected in this state or from residents thereof with respect to members or beneficiaries in the last calendar year, the amounts actually paid during such year for health services for the members or beneficiaries, and the amounts placed in reserves;

(6) A financial report for the most recent fiscal year of the corporation, prepared by an officer of the corporation or by a certified public accountant;

(7) A statement of any other facts or information concerning the affairs of the health services corporation which may be required reasonably by the director.

(L. 1973 S.B. 3 § 20, A.L. 1983 H.B. 127)

354.115. Any individual member of a corporation subject to the provisions of sections 354.010 to 354.380 who believes himself to be aggrieved by any act or omission of such corporation or its officers, directors, or employees may file a statement in writing of his grievance in the office of the director, and the director may make such investigation of such grievance as he deems appropriate. No such investigation by the director shall act as a bar to any suit in a court of competent jurisdiction instituted by any such member, or as a bar to any defense thereto by the corporation involved.

(L. 1973 S.B. 3 § 22, A.L. 1983 H.B. 127)

354.120. The director may promulgate such reasonable rules and regulations not inconsistent with the provisions of sections 354.010 to 354.380 as he shall deem necessary for its proper administration, pursuant to the provisions of this section and chapter 536, RSMo. No rule or portion of a rule promulgated under the authority of this chapter shall become effective unless it has been promulgated pursuant to the provisions of section 536.024, RSMo.

(L. 1973 S.B. 3 § 23, A.L. 1983 H.B. 127, A.L. 1993 S.B. 52, A.L. 1995 S.B. 3)

354.125. A health services corporation shall not be liable for injuries resulting from neglect, misfeasance, malfeasance or malpractice on the part of any person, organization, agency or corporation rendering health services to the health services corporation's members and beneficiaries.

(L. 1973 S.B. 3 § 24)

354.130. Every health services corporation shall be exempt from all taxes with respect to its membership dues or fees and other income, and shall be exempt from all franchise taxes and license fees except as otherwise specified in sections 354.010 to 354.380.

(L. 1973 S.B. 3 § 25, A.L. 1983 H.B. 127)

354.140. Any dissolution, liquidation, or rehabilitation of a corporation subject to the provisions of sections 354.010 to 354.380 shall be instituted and carried out pursuant to the provisions of chapter 355, RSMo, to the extent that the same are not inconsistent with the provisions of sections 354.010 to 354.380.

(L. 1973 S.B. 3 § 27, A.L. 1983 H.B. 127)

354.145. Every final administrative action or decision of the director under sections 354.010 to 354.380 shall be subject to judicial review under and in accordance with the administrative procedure and review law of this state, chapter 536, RSMo.

(L. 1973 S.B. 3 § 28, A.L. 1983 H.B. 127)

354.150. Every health services corporation subject to the provisions of sections 354.010 to 354.380 shall pay the following fees to the director for the administration and enforcement of the provisions of this chapter:

(1) For filing the declaration required on organization of each domestic company, two hundred fifty dollars;

(2) For filing statement and certified copy of charter required of foreign companies, two hundred fifty dollars;

(3) For filing application to renew certificate of authority, along with all required annual reports, including the annual statement, actuarial statement, risk-based capital report, report of valuation of policies or other obligations of assurance, and audited financial report of any company doing business in this state, one thousand five hundred dollars;

(4) For filing any paper, document, or report not filed under subdivision (1), (2), or (3) of this section but required to be filed in the office of the director, fifty dollars each;

(5) For affixing the seal of office of the director, ten dollars;

(6) For accepting each service of process upon the company, ten dollars.

(L. 1973 S.B. 3 § 29, A.L. 1983 H.B. 127, A.L. 1993 H.B. 709, A.L. 2007 S.B. 66)

354.152. Premiums, dues or fees made by each corporation shall be subject to the following provisions:

(1) Premiums, dues or fees shall not be excessive or inadequate, as herein defined, nor shall they be unfairly discriminatory;

(2) No premiums, dues or fees shall be held to be excessive unless such premiums, dues or fees are unreasonably high relative to the corporation's loss experience under policies, plans or contracts with respect to the territory or classification to which such premiums, dues or fees are applicable;

(3) No premiums, dues or fees shall be held to be inadequate unless such premiums, dues or fees are unreasonably low for the coverage provided and the continued use of such premiums, dues or fees endangers the solvency of the corporation using the same;

(4) If the director of the department of insurance has reason to believe that any premiums, dues or fees do not meet the standards of this section, he shall hold a public hearing in connection therewith, provided* that within a reasonable period of time, which shall be not less than ten days before the date of such hearing, he shall mail written notice specifying the matters to be considered at such hearing to any corporation believed by him not to be in compliance with the provisions of this section;

(5) If the director, after such hearings, for good cause finds that such premiums, dues or fees do not meet the provisions of this section, he shall issue an order specifying in what respects any such premiums, dues or fees fails to meet the provisions of this section and stating when, within a reasonable period of time thereafter, the further use of such premiums, dues or fees by the corporation which is the subject of the examination shall be prohibited and a copy of such order shall be sent to such corporation.

(L. 1979 S.B. 93)

*Word "providing" appears in original rolls.

354.155. Nothing contained in sections 354.010 to 354.380 shall affect the right to organize a corporation under chapter 352 or chapter 355, RSMo, or the powers or rights of corporations organized pursuant thereto which are not health services corporations.

(L. 1973 S.B. 3 § 30, A.L. 1983 H.B. 127)

354.165. The provisions of sections 354.010 to 354.380 or of any law relating to insurance shall not apply to any labor organization's health plan providing services established and maintained solely for its members and their immediate families, or to any health plan or services established and maintained by a trust in which a labor organization is interested as that term is defined in, and which trust is subject to the provisions and regulations of, the Federal Labor-Management Reporting and Disclosure Act, 29 U.S.C. 401-531. The administrator of any other plan or program to provide health service or benefits, or to pay or indemnify for the payment of their cost, which is maintained by any employer or jointly by any employer and employees and/or labor organizations exclusively for employees and their families, hereinafter referred to as "plan or program", shall make and file annually with the director on or before the first day of March of each year a report under oath, upon a form to be prescribed by the director, setting out the income and expenses of the plan or program for the preceding year and its financial condition as of the end of that year. In lieu of filing such prescribed form the administrator of any such plan or program may file with the director a duplicate set of documents, records, reports, booklets and other instruments as may have been filed by it within the preceding twelve months pursuant to the Federal Welfare and Pension Plans Disclosure Act, 29 U.S.C. 301-309, the Federal Labor-Management Reporting and Disclosure Act, 29 U.S.C. 151-168, 401-531 or the Labor Management Relations Act, 29 U.S.C. 186. Any labor organization member or any employee claiming to be aggrieved under the terms of any such plan or program may file a complaint with respect thereto with the director. The authority of the director under the insurance laws of this state and sections 354.010 to 354.380 to prohibit or regulate such a plan or program shall be limited to the following:

(1) Compelling the filing of the annual reports referred to above;

(2) Investigating the complaints of members or employees;

(3) Examining the financial conditions, affairs and management of the plan or program;

(4) Instituting judicial proceedings to enjoin the continuation of any act or practices which he believes to be unfair and deceptive with respect to such members. This section shall not be construed as exempting from regulation by the department of insurance any insurance contract or health services contract which provides for the payment of benefits or the supplying of health services under the labor organization, union-employer-employee or employer-employee plans referred to in this section which are purchased from insurance companies or health-services corporations subject to regulation by the department of insurance.

(L. 1973 S.B. 3 § 32, A.L. 1983 H.B. 127)

354.175. Provisions of sections 354.010 to 354.380 or of any law relating to insurance shall not apply to any employer's plan to insure the continued payment of wages or like compensation to employees during periods of sickness or disability.

(L. 1973 S.B. 3 § 34, A.L. 1983 H.B. 127)

354.180. 1. If the director determines that a person has engaged, is engaging in, or has taken a substantial step toward engaging in an act, practice or course of business constituting a violation of sections 354.010 to 354.380 or a rule adopted or order issued pursuant thereto, or a person has materially aided or is materially aiding an act, practice, omission, or course of business constituting a violation of sections 354.010 to 354.380 or a rule adopted or order issued pursuant thereto, the director may issue such administrative orders as authorized under section 374.046, RSMo. A violation of these sections is a level two violation under section 374.049, RSMo, except for any violation of sections 354.320 and 354.350, which is a level three violation.

2. If the director believes that a person has engaged, is engaging in, or has taken a substantial step toward engaging in an act, practice or course of business constituting a violation of sections 354.010 to 354.380 or a rule adopted or order issued pursuant thereto, or that a person has materially aided or is materially aiding an act, practice, omission, or course of business constituting a violation of sections 354.010 to 354.380 or a rule adopted or order issued pursuant thereto, the director may maintain a civil action for relief authorized under section 374.048, RSMo. A violation of these sections is a level two violation under section 374.049, RSMo, except for any violation of sections 354.320 and 354.350, which is a level three violation.

(L. 1983 H.B. 127, A.L. 2007 S.B. 66)

354.190. 1. The director shall examine and inquire into all violations of the laws of the state applicable to corporations subject to the provisions of sections 354.010 to 354.380, and examine the financial condition, affairs and management of any corporation subject to the provisions of sections 354.010 to 354.380 incorporated by or doing business in this state, and inquire into and investigate the business transacted in this state by any corporation subject to the provisions of sections 354.010 to 354.380 or such corporation's enrollment representatives.

2. He or any of his duly appointed agents may compel the attendance before him, and may examine, under oath, the directors, officers, employees, enrollment representatives, attorneys or any other person, in reference to the condition, affairs, management of the business, or any matters relating thereto. He may administer oaths or affirmations, and shall have power to summon and compel the attendance of witnesses, and to require and compel the production of records, books, papers, contracts or other documents, if necessary.

3. The director may make and conduct the examination in person, or he may appoint one or more persons to make and conduct the same for him. If made by one other than the director in person, the person duly appointed by the director shall have the same powers as above granted to the director. A certificate of appointment, under the official seal of the director, shall be sufficient authority and evidence thereof for the person or persons to act. For the purpose of making the examinations, or having the same made, the director may employ the necessary clerical, actuarial and other assistance.

4. The director may accept, in lieu of an examination by himself, or by his authority, a certificate of an examination, accompanied by a statement of all the facts in the case made by the insurance commissioner or superintendent of another state, of a health services corporation organized under the laws of such state.

(L. 1983 H.B. 127)

354.195. Said director shall keep and preserve in a permanent form a full record of his proceedings, including a concise statement of the condition of every corporation subject to the provisions of sections 354.010 to 354.380 whose affairs he shall have examined.

(L. 1983 H.B. 127)

354.200. 1. Any person testifying falsely in reference to any matter material to the investigation, examination or inquiry shall, upon conviction thereof, be deemed guilty of a class A misdemeanor, punishable as provided by law.

2. Any person who shall refuse to give such director full and truthful information, and answer in writing to any inquiry or question made in writing by the director, in regard to the business * relating to any corporation subject to the provisions of sections 354.010 to 354.380 carried on by such person, or to appear and testify under oath before the director in regard to the same, shall, upon conviction thereof, be deemed guilty of a class B misdemeanor, punishable as provided by law.

3. Any director, officer, manager, enrollment representative, or employee of any corporation subject to the provisions of sections 354.010 to 354.380, or any other person, who shall make any false certificate or entry or memorandum upon any of the books or papers of any such corporation, or upon any statement or exhibit offered, filed or offered to be filed in the insurance department, or used in the course of any examination, inquiry or investigation, with intent to deceive the director or any person employed or appointed by him to make any examination, inquiry or investigation, shall, upon conviction thereof, be guilty of a class A misdemeanor, punishable as provided by law.

(L. 1983 H.B. 127)

*Word "of" appears here in original rolls.

354.205. 1. The expenses of any proceedings concerning, or examinations of, a corporation subject to the provisions of sections 354.010 to 354.380, conducted by the department of insurance, shall be assessed by the director upon the corporation proceeded against or examined, or whose policies have been valued, and shall be in the first instance paid by such corporation, on the order of the director, directly to the person or persons rendering the service.

2. If the corporation subject to the provisions of sections 354.010 to 354.380 has been or shall be adjudged insolvent, or shall neglect, fail or refuse to pay the director may approve the payment of the expenses, in whole or in part, which shall be paid in like manner as other expenses of the insurance department; and the amount so paid, together with cost, charges and fees for collecting the same, shall be a first lien upon all the assets and property of such corporation, and may be recovered by the director of revenue in any court of competent jurisdiction; or if such corporation be in liquidation, or process of being wound up, the cost and expenses of settling its affairs shall be allowed and taxed as costs against said corporation, and shall be a first lien upon and payable out of its assets. The director of revenue shall deposit such sums in the state treasury to reimburse the insurance fund.

3. Before any costs of any examination or valuation shall be paid, vouchers for the same shall be submitted to and approved by the commissioner of administration.

4. When any examination or valuation is made by the director in person or by any salaried employee of the department of insurance, the cost of making the same shall be certified to the director of revenue for collection.

(L. 1983 H.B. 127)

354.207. 1. A health services corporation shall allow enrollees to seek a second medical opinion or consultation from a willing second physician at no additional cost to the enrollee beyond what the enrollee would otherwise pay for an initial medical opinion or consultation from that second physician.

2. If an enrollee chooses to seek a second medical opinion, and if the health services corporation does not employ or contract with another physician with the expertise necessary to provide a second medical opinion, then the health services corporation shall arrange for a referral to another physician with the necessary expertise to provide a second opinion or consultation and ensure that the enrollee obtains the covered benefit at no greater cost to the enrollee than if the benefit were obtained from participating physicians.

3. The second opinions required in this section and section 354.546 shall be covered only in the event that the original diagnosis requires major surgery or other treatment necessitating general anesthesia or other serious illness involving loss of bodily part or function or other debilitating disease.

(L. 1998 S.B. 754 § 354.207, § 1)

354.210. If the director has reason to believe that any health services corporation is in such financial condition that the assumption of additional obligations would be hazardous to its members or the general public, the director may issue orders or seek relief to protect the public under the provisions of section 354.180.

(L. 1983 H.B. 127, A.L. 2007 S.B. 66)

354.215. The provisions of sections 374.261 to 374.269, RSMo, which relate to the insurance examiner's sick leave fund, shall apply to health services corporations certified to operate in this state in the same manner as these sections now apply to those domestic insurers which pay a premium tax and are engaged in the business of insurance within this state. The provisions of sections 374.261 to 374.269, RSMo, shall also apply to examiners of the department of insurance conducting examinations under section 354.190 in the same manner as these sections now apply to examiners of the department of insurance conducting examinations under section 374.190, RSMo.

(L. 1983 H.B. 127)

354.220. 1. The director may bring suit to recover any fees or other sums which he is authorized by law to demand or collect.

2. Any corporation subject to the provisions of sections 354.010 to 354.380 or person liable for any fees or assessments who shall neglect or refuse to pay the same within ten days after written demand by the director shall be liable to pay double the amount of such fees or assessments; and any judgment recovered in such case shall be for double such amount and costs.

(L. 1983 H.B. 127)

354.225. 1. Any employee of a corporation subject to the provisions of sections 354.010 to 354.380 who, for compensation, solicits membership in a prepayment health services plan offered by such corporation, or offers or assumes to act in negotiation thereof, shall be an "enrollment representative" of such corporation. Every corporation subject to sections 354.010 to 354.380 shall furnish the director annually, at the time of filing its annual report, the name, title and address of such person employed by it as the corporation's enrollment representative.

2. Any person who, for compensation, solicits membership in a prepayment health services plan offered by a corporation subject to the provisions of sections 354.010 to 354.380, who is not an employee of such corporation, shall be an insurance agent or broker licensed to transact such business in the state of Missouri.

3. Enrollment representatives, agents and brokers soliciting, negotiating, procuring or making membership agreements for a corporation subject to the provisions of sections 354.010 to 354.380 shall be subject to all the insurance laws of this state applicable to agents and brokers authorized to solicit, negotiate, procure or make health insurance coverage in this state, including those provisions of chapter 375, RSMo, relating to the education, licensing, appointment, termination and discipline of agents and brokers.

(L. 1983 H.B. 127, A.L. 1993 H.B. 709)

354.230. No person shall act in this state as an enrollment representative unless he is licensed by the director as provided in this chapter.

(L. 1983 H.B. 127)

354.235. 1. The director shall issue a license to any natural person who is at least eighteen years of age, and has complied with the requirements of sections 354.010 to 354.380, authorizing the licensee to act as an enrollment representative on behalf of any corporation subject to the provisions of sections 354.010 to 354.380.

2. Any license issued shall authorize only the licensee named in the license to act individually as an enrollment representative thereunder.

(L. 1983 H.B. 127, A.L. 1993 S.B. 709)

354.240. 1. A person not a legal resident of this state may be licensed to act in this state as an enrollment representative upon compliance with the provisions of this chapter provided that the state in which the person resides will accord the same privilege to a resident of this state. The director is authorized to enter into reciprocal agreements with the appropriate official of any other state waiving the written examination of any applicant residing in the other state; provided, the director deems the applicant fully qualified and competent; and

(1) That a written examination is required of applicants for similar licenses in the other state; and

(2) That the appropriate official in that state certifies that the applicant holds a currently valid license of similar type in that state and either passed a written examination or was the holder of such license prior to the time a written examination was required.

2. In the event that the applicant is a resident of a state which does not require a written examination, then the director shall subject him to a written examination under terms and conditions to be prescribed by the director of insurance.

3. In the event that the applicant is a resident of another state in which the appropriate insurance official, as a general policy, has refused to permit legal residents of Missouri to become licensed as enrollment representatives and to transact the business of a health services corporation in such state, then the director shall not license any applicant from that state.

(L. 1983 H.B. 127)

354.265. A nonrenewable temporary license may be issued for a period not to exceed ninety days in cases where an applicant has theretofore filed a completed application for a license, has secured an appointment by a corporation subject to the provisions of sections 354.010 to 354.380, has paid the applicable fees and where the director is satisfied as to the applicant's business reputation.

(L. 1983 H.B. 127)

354.275. Any person willfully violating any of the provisions of sections 354.225 to 354.270 is guilty of a class A misdemeanor and on conviction thereof, if the offender holds a license under these sections, the court imposing sentence shall order the director of the department of insurance to revoke the license.

(L. 1983 H.B. 127)

354.280. The director shall not grant or continue authority to transact insurance in this state as to any corporation subject to the provisions of sections 354.010 to 354.380, one or more of the managing officers of which is found by him, after hearing, to be of known bad character or to be so incompetent or untrustworthy as to make the proposed operation hazardous to the health services corporation's current or potential members; or which he has good reason to believe is affiliated directly or indirectly through ownership, control, reinsurance transactions or other insurance or business relations with any person or persons whose business operations are or have been detrimental to policyholders, stockholders, investors, creditors, members or the public by illegal or fraudulent manipulation or dissipation of assets or accounts, or of reinsurance of any insurance company or companies, or by similar injurious actions.

(L. 1983 H.B. 127)

354.285. 1. All agreements or contracts under which any person, organization or corporation enjoys in fact the exclusive or dominant right to manage or control any corporation subject to the provisions of sections 354.010 to 354.380 to the substantial exclusion of the board of directors, officers, attorney in fact or other lawful management shall be filed with the director on his request.

2. The director, for the purpose of ascertaining the assets, conditions and affairs of any corporation subject to the provisions of sections 354.010 to 354.380, may examine the books, records, documents and assets of any person having a contract or agreement as provided in subsection 1 to the extent necessary to determine the financial condition of such corporation. The failure or refusal of any such person to submit his books, papers, accounts, records or affairs to the reasonable inspection or examination of the director shall be grounds for the suspension or revocation of the certificate of authority of the corporation to do business in this state.

3. No agreement or contract as provided in subsection 1 shall operate to the financial detriment of the corporation in such manner as to endanger its financial stability or otherwise be hazardous to the members and creditors of the corporation.

4. On examination of any agreement or contract, if the director finds it violates the provisions of this section, he shall proceed in accordance with the provisions of section 354.180.

5. Any person, organization or corporation having a management contract as provided in subsection 1 hereof shall within five days of execution of such contract provide notice of such contract to the director of insurance.

(L. 1983 H.B. 127)

354.290. 1. Every examiner shall make a full and true report of every examination made by him, verified by his oath, which examination shall comprise only facts appearing upon the books, papers, records or documents of the corporation subject to the provisions of sections 354.010 to 354.380, or ascertained from the testimony sworn to by its officers or agents or other persons examined under oath, concerning its affairs and such conclusions and recommendations as may reasonably be warranted from the facts so disclosed.

2. The director shall grant a hearing to the corporation examined before filing any report and may withhold any report from public inspection for such time as he deems proper, and may, if he deem it for the interest of the public to do so, publish any report or the result of any examination as contained therein in one or more newspapers of the state.

(L. 1983 H.B. 127)

354.295. The director shall not approve any declaration of organization or articles of incorporation or issue a certificate of authority to any company until he has found that there is no good reason to believe that the incorporators, directors and proposed officers are affiliated, directly or indirectly, through ownership, control, management, reinsurance transactions or other insurance or business relations with any person or persons known to have been involved in the improper manipulation of assets, accounts or reinsurance.

(L. 1983 H.B. 127)

354.300. Other provisions of law notwithstanding, the director may suspend or revoke, after a hearing, the certificate of authority or license of any corporation subject to the provisions of sections 354.010 to 354.380 for the same reasons and upon the same grounds as set forth in section 354.355.

(L. 1983 H.B. 127)

354.305. 1. Whenever any corporation subject to the provisions of sections 354.010 to 354.380 doing business in this state advertises its assets, either in any newspaper or periodical, or by any sign, circular, card, policy of insurance or certificate of renewal thereof, it shall, in the same connection, equally conspicuously advertise its liabilities, the same to be determined in the manner required in making statement to the insurance division, and all advertisements purporting to show the amount of capital of the company shall show only the amount of capital actually paid up in cash.

2. Any corporation subject to the provisions of sections 354.010 to 354.380 or enrollment representative violating the provisions of this section shall, upon conviction thereof, be guilty of a class B misdemeanor, punishable as provided by law.

(L. 1983 H.B. 127)

354.315. Notwithstanding any prohibitions or restrictions contained in the statutes, any corporation subject to the provisions of sections 354.010 to 354.380 may acquire by purchase electronic or mechanical machines constituting a data processing system, and thereafter may hold the system as an admitted asset for use in connection with the business of the company if

(1) The system shall have an aggregate cost of not less than twenty-five thousand dollars and its aggregate cost shall not exceed five percent of the admitted assets of the company;

(2) The cost of the component machines constituting the system shall be fully amortized over a period not to exceed ten calendar years. If a data processing system consists of separate component machines which are acquired at different times, then the cost of each component shall be fully amortized over a period not to exceed ten calendar years commencing with the date of acquisition of each component.

(L. 1983 H.B. 127)

354.320. No officer, enrollment representative or employee of any corporation subject to the provisions of sections 354.010 to 354.380, formed under the laws of this state, or doing business herein, shall, directly or indirectly, use or employ, or permit others to use or employ, any of the money, funds or securities of such corporation for private profit or gain, except for reasonable compensation for services performed and reimbursement for expenses incurred, and any such use shall, upon conviction thereof, be a class D felony.

(L. 1983 H.B. 127)

354.325. 1. The director of insurance shall, as often as he may deem proper, make careful inquiry and investigation as to the manner in which the money, funds or securities of corporations subject to the provisions of sections 354.010 to 354.380, doing business in this state, are invested or employed, and record the result of such inquiry or investigation in records kept in his office for the inspection of members and public officials.

2. In the event of a violation of this section or of section 354.320, the prosecuting attorney of the proper county, or in the city of St. Louis, the circuit attorney, shall proceed at once by information or indictment against the offenders.

(L. 1983 H.B. 127)

354.330. Any public official failing, neglecting or refusing to comply with any of the provisions of sections 354.320 and 354.325 shall be deemed guilty of a misdemeanor, and, upon conviction, shall be fined not less than five hundred dollars and forfeit his office.

(L. 1983 H.B. 127)

354.335. In any action against any corporation subject to the provisions of sections 354.010 to 354.380 to recover the amount of any loss under a policy of health insurance, if it appears from the evidence that such corporation has refused to pay such loss without reasonable cause or excuse, the court or jury may, in addition to the amount thereof and interest, allow the plaintiff damages not to exceed twenty percent of the first fifteen hundred dollars of the loss, and ten percent of the amount of the loss in excess of fifteen hundred dollars and a reasonable attorney's fee; and the court shall enter judgment for the aggregate sum found in the verdict.

(L. 1983 H.B. 127)

354.340. Whenever any judgment shall be obtained in any of the courts of this state against any corporation subject to the provisions of sections 354.010 to 354.380 doing business in this state, and said judgment shall remain unsatisfied for fifteen days after execution shall have been lawfully issued thereon, the certificate of authority or license to do business issued or granted to such corporation shall immediately be suspended or revoked by the director of the insurance department, upon said director being notified thereof, and such insurance company shall, after such suspension or revocation, be prohibited from transacting any business in this state until such judgment shall be satisfied.

(L. 1983 H.B. 127)

354.345. Any person, who has heretofore obtained or may hereafter obtain, in any of the courts of this state, a decree against any corporation subject to the provisions of sections 354.010 to 354.380 doing business in this state, commanding or directing said corporation to specifically perform a membership contract, may, if the corporation against which said decree is obtained, fails, for a period of fifteen days after the rendition of said decree, to comply with the same, obtain a copy of said decree, certified to under the hand and seal of the clerk of the court in which said decree was rendered, and transmit the same, together with the certificate of said clerk, reciting therein the failure of such corporation to comply with said decree, and transmit the same to the director of the insurance department of the state of Missouri, and immediately upon receipt thereof, the said director of insurance shall cause such corporation to be notified of the fact of the filing of such certified copy of said decree and certificate, and if such corporation fails for a period of thirty days thereafter to comply with said decree, the certificate of authority or license to do business issued or granted to such corporation shall immediately be suspended or revoked by the director of the insurance department, until such decree shall be satisfied; provided, however, the foregoing shall not be applicable while an appeal is pending if a supersedeas bond shall have been given.

(L. 1983 H.B. 127)

354.350. 1. It is unlawful for any corporation subject to the provisions of sections 354.010 to 354.380 transacting business in this state to:

(1) Conduct its business fraudulently;

(2) Fail to carry out its contracts in good faith; or

(3) Habitually and as a matter of business practice compel claimants under policies or liability judgment creditors of its members to either accept less than the amount due under the terms of the policy or resort to litigation against the corporation to secure payment of the amount due.

2. If the director determines that a person has engaged, is engaging in, or has taken a substantial step toward engaging in an act, practice or course of business constituting a violation of this section or a rule adopted or order issued pursuant thereto or that a person has materially aided or is materially aiding an act, practice, omission, or course of business constituting a violation of this section or a rule adopted or order issued pursuant thereto, the director may issue such administrative orders as authorized under section 374.046, RSMo. Each practice in violation of this section is a level two violation under section 374.049, RSMo. Each act as a part of a practice does not constitute a separate violation under section 374.049, RSMo. The director may also suspend or revoke the license or certificate of authority of a corporation subject to the provisions of sections 354.010 to 354.380 or enrollment representative for any such willful violation.

3. If the director believes that a person has engaged, is engaging in, or has taken a substantial step toward engaging in an act, practice or course of business constituting a violation of this section or a rule adopted or order issued pursuant thereto or that a person has materially aided or is materially aiding an act, practice, omission, or course of business constituting a violation of this section or a rule adopted or order issued pursuant thereto, the director may maintain a civil action for relief authorized under section 374.048, RSMo. Each practice in violation of this section is a level two violation under section 374.049, RSMo. Each act as a part of a practice does not constitute a separate violation under section 374.049, RSMo.

(L. 1983 H.B. 127, A.L. 2007 S.B. 66)

354.355. Whenever it shall appear to the director of the insurance department, from any examination made by himself, or from the report of a person or persons appointed by him, or from the statements of the corporation subject to the provisions of sections 354.010 to 354.380, or from any knowledge or information in his possession

(1) That the corporation has refused to submit its books, papers, accounts or affairs to the reasonable inspection of the director or his deputy or his examiner; or

(2) That the corporation has, by contract of reinsurance or otherwise, transferred or attempted to transfer substantially its entire property or business, or entered into any transaction, the effect of which is to merge substantially its entire property or business in the property or business of any other corporation, association, society, order, partnership or individual without first having obtained the written approval of the director of insurance as provided by law; or

(3) That the corporation is found, after an examination, to be in such condition that its further transaction of business will be hazardous to its policyholders or to its creditors or to the public; or

(4) That the corporation has an officer who has refused to be examined under oath touching its affairs; or

(5) That the corporation has ceased to transact the business of insurance for a period of one year;

the director may institute a suit or proceedings in the circuit court in the county or city in which the corporation was organized or in which it has or last had its principal or chief office or place of business or in the county of Cole, to enjoin the corporation from further prosecution of its business, either temporarily or perpetually, or for a judgment dissolving the corporation or for both; and after the entry of the decree or judgment, the court upon the motion of the director of the insurance department may order the liquidation, settlement and winding up of the affairs of such corporation or the rehabilitation of the corporation as provided in section 354.140 together with such other decrees and orders in connection therewith as the court shall deem advisable.

(L. 1983 H.B. 127 § 354.355 subsec. 1)

354.357. 1. Whenever the director institutes proceedings under section 354.355, he may also institute proceedings in the same case for receivership for any organization or corporation having the exclusive or dominant right to manage or control the corporation subject to the provisions of sections 354.010 to 354.380 which is the subject of the main case, when it appears that a receiver is necessary for the preservation of the assets of the corporation or that a receiver is necessary to determine the assets of the corporation held by the organization or corporation. The duration of the receivership and the duties of the receiver shall be in the discretion of the court.

2. The director may apply to the circuit court of Cole County, Missouri, for an order appointing him as receiver or ancillary receiver, and directing him to conserve the assets within this state of any foreign or alien corporation subject to the provisions of sections 354.010 to 354.380 upon any of the following grounds:

(1) Upon any of the grounds specified in section 354.355; or

(2) That the corporation has been placed in conservatorship or receivership in its domiciliary state or sovereignty or elsewhere.

The institution of and the operation of the receivership shall be in accordance with chapter 355, RSMo.

(L. 1983 H.B. 127 § 354.355 subsecs. 2, 3)

354.362. The provisions of section 376.406, RSMo, shall apply to all health services corporations subject to the provisions of sections 354.010 to 354.380.

(L. 1983 H.B. 127)

354.380. The provisions of sections 375.936 and 376.770 to 376.800, RSMo, shall apply to all health services corporations subject to the provisions of sections 354.010 to 354.380.

(L. 1983 H.B. 127)

354.400. As used in sections 354.400 to 354.636, the following terms shall mean:

(1) "Basic health care services", health care services which an enrolled population might reasonably require in order to be maintained in good health, including, as a minimum, emergency care, inpatient hospital and physician care, and outpatient medical services;

(2) "Community-based health maintenance organization", a health maintenance organization which:

(a) Is wholly owned and operated by hospitals, hospital systems, physicians, or other health care providers or a combination thereof who provide health care treatment services in the service area described in the application for a certificate of authority from the director;

(b) Is operated to provide a means for such health care providers to market their services directly to consumers in the service area of the health maintenance organization;

(c) Is governed by a board of directors that exercises fiduciary responsibility over the operations of the health maintenance organization and of which a majority of the directors consist of equal numbers of the following:

a. Physicians licensed pursuant to chapter 334, RSMo;

b. Purchasers of health care services who live in the health maintenance organization's service area;

c. Enrollees of the health maintenance organization elected by the enrollees of such organization; and

d. Hospital executives, if a hospital is involved in the corporate ownership of the health maintenance organization;

(d) Provides for utilization review, as defined in section 374.500, RSMo, under the auspices of a physician medical director who practices medicine in the service area of the health maintenance organization, using review standards developed in consultation with physicians who treat the health maintenance organization's enrollees;

(e) Is actively involved in attempting to improve performance on indicators of health status in the community or communities in which the health maintenance organization is operating, including the health status of those not enrolled in the health maintenance organization;

(f) Is accountable to the public for the cost, quality and access of health care treatment services and for the effect such services have on the health of the community or communities in which the health maintenance organization is operating on a whole;

(g) Establishes an advisory group or groups comprised of enrollees and representatives of community interests in the service area to make recommendations to the health maintenance organization regarding the policies and procedures of the health maintenance organization;

(h) Enrolls fewer than fifty thousand covered lives;

(3) "Covered benefit" or "benefit", a health care service to which an enrollee is entitled under the terms of a health benefit plan;

(4) "Director", the director of the department of insurance, financial and professional regulation;

(5) "Emergency medical condition", the sudden and, at the time, unexpected onset of a health condition that manifests itself by symptoms of sufficient severity that would lead a prudent lay person, possessing an average knowledge of health and medicine, to believe that immediate medical care is required, which may include, but shall not be limited to:

(a) Placing the person's health in significant jeopardy;

(b) Serious impairment to a bodily function;

(c) Serious dysfunction of any bodily organ or part;

(d) Inadequately controlled pain; or

(e) With respect to a pregnant woman who is having contractions:

a. That there is inadequate time to effect a safe transfer to another hospital before delivery; or

b. That transfer to another hospital may pose a threat to the health or safety of the woman or unborn child;

(6) "Emergency services", health care items and services furnished or required to screen and stabilize an emergency medical condition, which may include, but shall not be limited to, health care services that are provided in a licensed hospital's emergency facility by an appropriate provider;

(7) "Enrollee", a policyholder, subscriber, covered person or other individual participating in a health benefit plan;

(8) "Evidence of coverage", any certificate, agreement, or contract issued to an enrollee setting out the coverage to which the enrollee is entitled;

(9) "Health care services", any services included in the furnishing to any individual of medical or dental care or hospitalization, or incident to the furnishing of such care or hospitalization, as well as the furnishing to any person of any and all other services for the purpose of preventing, alleviating, curing, or healing human illness, injury, or physical disability;

(10) "Health maintenance organization", any person which undertakes to provide or arrange for basic and supplemental health care services to enrollees on a prepaid basis, or which meets the requirements of Section 1301 of the United States Public Health Service Act;

(11) "Health maintenance organization plan", any arrangement whereby any person undertakes to provide, arrange for, pay for, or reimburse any part of the cost of any health care services and at least part of such arrangement consists of providing and assuring the availability of basic health care services to enrollees, as distinguished from mere indemnification against the cost of such services, on a prepaid basis through insurance or otherwise, and as distinguished from the mere provision of service benefits under health service corporation programs;

(12) "Individual practice association", a partnership, corporation, association, or other legal entity which delivers or arranges for the delivery of health care services and which has entered into a services arrangement with persons who are licensed to practice medicine, osteopathy, dentistry, chiropractic, pharmacy, podiatry, optometry, or any other health profession and a majority of whom are licensed to practice medicine or osteopathy. Such an arrangement shall provide:

(a) That such persons shall provide their professional services in accordance with a compensation arrangement established by the entity; and

(b) To the extent feasible for the sharing by such persons of medical and other records, equipment, and professional, technical, and administrative staff;

(13) "Medical group/staff model", a partnership, association, or other group:

(a) Which is composed of health professionals licensed to practice medicine or osteopathy and of such other licensed health professionals (including dentists, chiropractors, pharmacists, optometrists, and podiatrists) as are necessary for the provisions of health services for which the group is responsible;

(b) A majority of the members of which are licensed to practice medicine or osteopathy; and

(c) The members of which (i) as their principal professional activity over fifty percent individually and as a group responsibility engaged in the coordinated practice of their profession for a health maintenance organization; (ii) pool their income from practice as members of the group and distribute it among themselves according to a prearranged salary or drawing account or other plan, or are salaried employees of the health maintenance organization; (iii) share medical and other records and substantial portions of major equipment and of professional, technical, and administrative staff; (iv) establish an arrangement whereby an enrollee's enrollment status is not known to the member of the group who provides health services to the enrollee;

(14) "Person", any partnership, association, or corporation;

(15) "Provider", any physician, hospital, or other person which is licensed or otherwise authorized in this state to furnish health care services;

(16) "Uncovered expenditures", the costs of health care services that are covered by a health maintenance organization, but that are not guaranteed, insured, or assumed by a person or organization other than the health maintenance organization, or those costs which a provider has not agreed to forgive enrollees if the provider is not paid by the health maintenance organization.

(L. 1983 H.B. 127, A.L. 1997 H.B. 335, A.L. 2007 S.B. 66)

354.405. 1. Notwithstanding any law of this state to the contrary, any person may apply to the director for a certificate of authority to establish and operate a health maintenance organization in compliance with this act. No person shall establish or operate a health maintenance organization in this state without obtaining a certificate of authority pursuant to sections 354.400 to 354.636. A foreign corporation may qualify pursuant to sections 354.400 to 354.636, subject to its registration to do business in this state as a foreign corporation pursuant to chapter 351, RSMo, and compliance with the provisions of sections 354.400 to 354.636.

2. Every health maintenance organization doing business in this state on September 28, 1983, shall submit an application for a certificate of authority pursuant to subsection 3 of this section within one hundred twenty days of September 28, 1983. Each such applicant may continue to operate until the director acts upon the application. In the event that an application is not submitted or is denied pursuant to section 354.410, the applicant shall henceforth be treated as a health maintenance organization whose certificate of authority has been revoked. Any health maintenance organization licensed by the department of insurance prior to September 28, 1983, and complying with the paid-in capital or guarantee fund requirements of section 354.410 shall be issued a certificate of authority upon filing an amended certificate of authority and an amended articles of incorporation that conform with sections 354.400 to 354.636. When the annual statement of a health maintenance organization subject to the provisions of sections 354.400 to 354.636 is filed and all fees due from the health maintenance organization are tendered, the health maintenance organization's certificate of authority to do business in this state shall automatically be extended pending formal renewal by the director, or until such time as the director should refuse to renew the certificate.

3. Each application for a certificate of authority shall be verified by an officer or authorized representative of the applicant, shall be in a form prescribed by the director, and shall set forth or be accompanied by the following:

(1) A copy of the organizational documents of the applicant such as the articles of incorporation, articles of association, partnership agreement, trust agreement, or other applicable documents, and all amendments thereto;

(2) A copy of the bylaws, rules and regulations, or similar document, if any, regulating the conduct of the internal affairs of the applicant;

(3) A list of the names, addresses, and official positions of the persons who are to be responsible for the conduct of the affairs of the applicant, including all members of the board of directors, board of trustees, executive committee, or other governing board or committee, the principal officers if the applicant is a corporation, and the partners or members if the applicant is a partnership or association;

(4) A copy of any contract made or to be made between any providers and persons listed in subdivision (3) of this subsection and the applicant;

(5) A copy of the form of evidence of coverage to be issued to the enrollees;

(6) A copy of the form of the group contract, if any, which is to be issued to employers, unions, trustees, or other organizations;

(7) Financial statements showing the applicant's assets, liabilities, and sources of financial support. If the applicant's financial affairs are audited by independent certified public accountants, a copy of the applicant's most recent certified financial statement shall be deemed to satisfy this requirement unless the director directs that additional or more recent financial information is required for the proper administration of sections 354.400 to 354.636;

(8) A description of the proposed method of marketing the plan, a financial plan which includes a three-year projection of operating results anticipated, and a statement as to the sources of working capital as well as any other sources of funding;

(9) If the applicant is not domiciled in this state, a power of attorney duly executed by such applicant appointing the director, the director's successors in office, and duly authorized deputies, as the true and lawful attorney of such applicant in and for this state upon whom all lawful process in any legal action or proceeding against the health maintenance organization on a cause of action arising in this state may be served;

(10) A statement reasonably describing the geographic area or areas to be served;

(11) A description of the complaints procedures to be utilized as required by section 354.445;

(12) A description of the mechanism by which enrollees will be afforded an opportunity to participate in matters of policy and operation;

(13) Evidence demonstrating that the health maintenance organization has provided its enrollees with adequate access to health care providers; and

(14) Such other information as the director may require to make the determinations required in section 354.410.

4. Every health maintenance organization shall file with the director notice of its intention to modify any of the procedures or information described in and required to be filed by this section. Such changes shall be filed with the director prior to the actual modification. If the director does not disapprove the modification within forty-five days of filing, citing specific reasons for noncompliance, such modification shall be deemed approved. If a filing that is deemed approved is a document described in subdivision (4), (5) or (6) of subsection 3 of this section, the director shall not disapprove the deemed filing for a period of twelve months thereafter. If at any time during that twelve-month period the director determines that any provision of the deemed filing is contrary to state law, the director shall notify the health maintenance organization of the specific provision that is contrary to state law, and any specific statute to which the provision is contrary to, and request that the health maintenance organization file, within thirty days of receipt of the request, an amendment form that modifies the provision to conform to the state law. Upon approval of the amendment form by the director, the health maintenance organization shall issue a copy of the amendment to each individual and entity to which the deemed filing was previously issued and shall attach a copy of the amendment to the deemed filing when it is subsequently issued. Such amendment shall have the force and effect as if the amendment was in the original filing or policy.

5. A health maintenance organization shall file all contracts of reinsurance. Any agreement between the organization and an insurer shall be subject to the laws of this state regarding reinsurance. All reinsurance agreements and any modifications thereto shall be filed and approved.

6. When the director deems it appropriate, the director may exempt any item from the filing requirements of this section.

(L. 1983 H.B. 127, A.L. 1997 H.B. 335, A.L. 2003 H.B. 121)

354.407. Notwithstanding the provisions of section 354.405 to the contrary, a program for all-inclusive care for the elderly (PACE) project sponsored by a religious or charitable organization that is itself or is controlled by an entity organized under Section 501(c)(3) of the Internal Revenue Code and which has had its application for the operation of a PACE program approved by the Center for Medicare and Medicaid Services of the federal Department of Health and Human Services and is operating under such approval shall not be deemed to be engaged in any business required to be licensed pursuant to section 354.405. Such exemption shall apply only to business conducted pursuant to the approved PACE contract and not to any other business that such organization may conduct.

(L. 2002 S.B. 1094)

354.410. 1. The director shall issue or deny a certificate of authority to any person filing an application pursuant to section 354.405. Issuance of a certificate of authority may then be granted upon payment of the application fee prescribed in section 354.500 if the director is satisfied that the following conditions are met:

(1) The persons responsible for the conduct of the affairs of the applicant are competent, trustworthy, and possess good reputations;

(2) The health care organization constitutes an appropriate mechanism whereby the health maintenance organization will effectively provide or arrange for the provision of basic health care services on a prepaid basis through insurance or otherwise, except to the extent of reasonable requirements for co-payments;

(3) The health maintenance organization is financially responsible and may reasonably be expected to meet its obligations to enrollees and prospective enrollees. In making this determination, the director may consider:

(a) The financial soundness of the arrangements for health care services and the schedule of charges used in connection therewith;

(b) The adequacy of working capital;

(c) Any agreement with an insurer, a government, or any other organization for insuring the payment of the cost of health care services or the provision for automatic applicability of an alternative coverage in the event of discontinuance of the health maintenance organization;

(d) Any agreement with providers for the provision of health care services; and

(e) Any deposit of cash or securities submitted in accordance with subsection 2;

(4) The health maintenance organization's arrangements for health care services and the schedule of charges used in connection therewith are financially sound;

(5) The working capital be adequate;

(6) Any agreement with an insurer, a health service corporation, a government, or any other organization for insuring the payment of the cost of health care services contain a provision for the automatic applicability of alternative coverage in the event of discontinuance of the health maintenance organization;

(7) There be an agreement with providers for the provision of health care services;

(8) The enrollees shall be afforded an opportunity to participate in matters of policy and operation pursuant to section 354.420;

(9) Nothing in the proposed method of operation, as shown by the information submitted pursuant to section 354.405 or by independent investigation, is contrary to the public interest;

(10) The health maintenance organization is able to provide its enrollees with adequate access to health care providers.

2. Unless otherwise provided below, each health maintenance organization shall deposit with the director, or with any organization or trustee acceptable to the director through which a custodial or controlled account is utilized, cash, securities, or any combination of these or other measures that is acceptable to the director in the amount set forth in this subsection:

(1) The amount for an organization that is beginning operation shall be the greater of: (a) five percent of its estimated expenditures for health care services for its first year of operation, (b) twice its estimated average monthly uncovered expenditures for its first year of operation, or (c) one hundred fifty thousand dollars for a medical group/staff model, or three hundred thousand dollars for an individual practice association. At the beginning of each succeeding year, unless not applicable, the organization shall deposit with the director, or organization or trustee, cash, securities, or any combination of these or other measures acceptable to the director, in an amount equal to four percent of its estimated annual uncovered expenditures for that year.

(2) Unless not applicable, an organization that is in operation on September 28, 1983, shall make a deposit equal to the larger of: (a) one percent of the preceding twelve months' uncovered expenditures, or (b) one hundred fifty thousand dollars for a medical group/staff model, or three hundred thousand dollars for an individual practice association on the first day of the first calendar year beginning six months or more after September 28, 1983. In the second calendar year, if applicable, the amount of the additional deposit shall be equal to two percent of its estimated annual uncovered expenditures. In the third calendar year, if applicable, the additional deposit shall be equal to three percent of its estimated annual uncovered expenditures for that year, and in the fourth calendar year and subsequent years, if applicable, the additional deposit shall be equal to four percent of its estimated annual uncovered expenditures for each year. Each year's estimate, after the first year of operation, shall reasonably reflect the prior years' operating experience and delivery arrangements. The director may waive any of the deposit requirements set forth in subdivisions (1) and (2) above, whenever satisfied that the organization has sufficient net worth and an adequate history of generating net income to assure its financial viability for the next year, or its performance and obligations are guaranteed by an organization with sufficient net worth and an adequate history of generating net income, or the assets of the organization or its contracts with insurers, hospital or medical service corporations, governments, or other organizations are sufficient to reasonably assure the performance of its obligations.

3. When an organization has achieved a net worth not including land, buildings, and equipment, of at least one million dollars or has achieved a net worth including organization-related land, buildings, and equipment of at least five million dollars, the annual deposit requirements shall not apply. The annual deposit requirement shall not apply to an organization if the total amount of the deposit is equal to twenty-five percent of its estimated annual uncovered expenditures for the next calendar year, or the capital and surplus requirements for the formation or admittance of an accident and health insurer in this state, whichever is less. If the organization has a guaranteeing organization which has been in operation for at least five years and has a net worth not including land, buildings, and equipment of at least one million dollars or which has been in operation for at least ten years and has a net worth including organization-related land, buildings, and equipment of at least five million dollars, the annual deposit requirement shall not apply; provided, however, that if the guaranteeing organization is sponsoring more than one organization, the net worth requirement shall be increased by a multiple equal to the number of such organizations. This requirement to maintain a deposit in excess of the deposit required of an accident and health insurer shall not apply during any time that the guaranteeing organization maintains a net worth at least equal to the capital and surplus requirements for an accident and health insurer for each organization it sponsors.

4. All income from deposits shall belong to the depositing organization and shall be paid to it as it becomes available. A health maintenance organization that has made a securities deposit may withdraw the securities deposit or any part thereof, first having deposited, in lieu thereof, a deposit of cash, securities, or any combination of these or other measures of equal amount and value to that withdrawn. Any securities shall be approved by the director before being substituted.

5. In any year in which an annual deposit is not required of an organization, at its request the director shall reduce the required deposit by one hundred thousand dollars for each two hundred fifty thousand dollars of net worth in excess of the amount that allows it not to make an annual deposit. If the amount of net worth no longer supports a reduction of its required deposit, the organization shall immediately redeposit one hundred thousand dollars for each two hundred fifty thousand dollars of reduction in net worth, provided that its total deposit shall not exceed the maximum required under this section. Notwithstanding any provisions of sections 354.400 to 354.636, the deposit held by the director shall in no case be less than one hundred fifty thousand dollars for a group staff/model or three hundred thousand dollars for an individual practice association model.

6. Each health maintenance organization that obtains a certificate of authority after September 28, 1983, shall have and maintain a capital account of at least one hundred fifty thousand dollars for a medical group/staff model, or three hundred thousand dollars for an individual practice association in addition to any deposit requirements under this section. The capital account shall be net of any accrued liabilities and be in the form of cash, securities or any combination of these or other measures acceptable to the director.

7. A certificate of authority shall be denied only after compliance with the requirements of section 354.490.

(L. 1983 H.B. 127, A.L. 1997 H.B. 335)

354.415. 1. The powers of a health maintenance organization include, but are not limited to, the power to:

(1) Purchase, lease, construct, renovate, operate, and maintain hospitals, medical facilities, or both, and their ancillary equipment, and such property as may reasonably be required for the organization's principal office or for such other purposes as may be necessary in the transaction of the business of the organization;

(2) Make loans to a medical group under contract with it in furtherance of its program, or to make loans to any corporation under its control for the purpose of acquiring or constructing medical facilities and hospitals or in the furtherance of a program providing health care services to enrollees;

(3) Furnish health care services through providers which are under contract with, or employed by, the health maintenance organization;

(4) Contract with any person for the performance, on the organization's behalf, of certain functions such as marketing, enrollment, and administration;

(5) Contract with an insurance company licensed in this state, or with a health services corporation authorized to do business in this state, for the provision of insurance, indemnity, or reimbursement against the cost of health care services provided by the health maintenance organization;

(6) Offer, in addition to basic health care services:

(a) Additional health care services;

(b) Indemnity benefits covering out-of-area or emergency services; and

(c) Indemnity benefits, in addition to those relating to out-of-area and emergency services, provided through insurers or health services corporations.

2. Prior to the exercise of any power granted in subdivision (1) or (2) of subsection 1 of this section, involving an amount in excess of five hundred thousand dollars, a health maintenance organization shall file notice, with adequate supporting information, with the director. The director shall disapprove such exercise of power if, in his opinion, it would substantially and adversely affect the financial soundness of the health maintenance organization and endanger its ability to meet its obligations. If the director does not disapprove such exercise of power within sixty days of the filing, it shall be deemed approved.

3. The director may exempt from the filing requirement of subsection 2 of this section those activities having minimal effect.

(L. 1983 H.B. 127)

354.420. The governing body of each health maintenance organization shall establish a mechanism to afford the enrollees an opportunity to participate in matters of policy and operation through the establishment of advisory panels, the use of advisory referenda on major policy decisions, or the use of other mechanisms.

(L. 1983 H.B. 127)

354.425. Any director, officer or partner of a health maintenance organization who receives, collects, disburses, or invests funds in connection with the activities of such organization shall be fiduciaries of such funds. Every health maintenance organization shall maintain in force a surety bond on such officers and employees in an amount of not less than one hundred thousand dollars, or such other sum as may be prescribed by the director. All such bonds shall be written with at least a one-year discovery period and, if written with less than a three-year discovery period, shall contain a provision that no cancellation or termination of the bond, whether by or at the request of the insured or by the underwriter, shall take effect prior to the expiration of ninety days after written notice of such cancellation or termination has been filed with the director, unless an earlier date of such cancellation or termination is approved by the director.

(L. 1983 H.B. 127)

354.430. 1. Every enrollee residing in this state is entitled to evidence of coverage. If the enrollee obtains coverage through an insurance policy or a contract issued by a health services corporation, whether by option or otherwise, the insurer or the health services corporation shall issue the evidence of coverage. Otherwise the health maintenance organization shall issue the evidence of coverage.

2. No evidence of coverage, or amendment thereto, shall be issued or delivered to any person in this state until a copy of the form of the evidence of coverage, or amendment thereto, has been filed with the director.

3. An evidence of coverage shall contain:

(1) No provisions or statements which are unjust, unfair, inequitable, misleading, or deceptive, or which encourage misrepresentation, or which are untrue, misleading, or deceptive as defined in subsection 1 of section 354.460; and

(2) A clear and complete statement, if a contract, or a reasonably complete summary, if a certificate, of:

(a) The health care services and the insurance or other benefits, if any, to which the enrollee is entitled;

(b) Any limitations on the services, kind of services, benefits or kinds of benefits to be provided, including any deductible or co-payment feature;

(c) Where and in what manner information is available as to how services may be obtained;

(d) The total amount of payment for health care services and the indemnity or service benefits, if any, which the enrollee is obligated to pay with respect to individual contracts; and

(e) A clear and understandable description of the health maintenance organization's method for resolving enrollee complaints, including the health maintenance organization's toll-free customer service number and the department of insurance's consumer complaint hot line number.

4. Any subsequent change in an evidence of coverage may be made in a separate document issued to the enrollee.

5. A copy of the form of the evidence of coverage to be used in this state, and any amendment thereto, shall be subject to the filing of subsection 2 of this section unless it is subject to the jurisdiction of the director under the laws governing health insurance or health services corporations, in which event the filing provisions of those laws shall apply.

(L. 1983 H.B. 127, A.L. 1997 H.B. 335)

354.435. 1. Every health maintenance organization shall annually, on or before March first, file a report, verified by at least two principal officers, with the director, covering its preceding calendar year.

2. Such report shall be on forms prescribed by the director and shall include:

(1) A financial statement of the organization, including its balance sheet for the preceding calendar year;

(2) Any material changes in the information submitted pursuant to subsection 3 of section 354.405;

(3) The number of persons enrolled during the year, the number of enrollees, as of the end of the year, and the number of enrollments terminated during the year;

(4) A statement setting forth the amount of uncovered and covered expenses that are payable and are more than ninety days past due for the period of August first through December thirty-first of the preceding year;

(5) Such other information relating to the performance of the organization as is necessary to enable the director to carry out his duties under sections 354.400 to 354.636.

(L. 1983 H.B. 127, A.L. 2007 S.B. 66)

CROSS REFERENCE:

Forms approval required, RSMo 37.340; failure to obtain, personal liability, RSMo 37.390

354.440. Every health maintenance organization shall make available to its enrollees:

(1) The most recent annual statement of financial condition, including a balance sheet and summary of receipts and disbursements;

(2) A description of the organizational structure and operation of the health care plan and a summary of any material changes since the issuance of the last report;

(3) A description of services and information as to where and how to secure them; and

(4) A clear and understandable description of the health maintenance organization's method for resolving enrollee complaints.

(L. 1983 H.B. 127)

354.441. No health maintenance organization plan, medical group/staff model, independent practice association or any other entity shall prohibit or restrict any provider from disclosing to any subscriber, enrollee or member any information that such provider deems appropriate regarding the nature of treatment, risks or alternatives thereto, the availability of other therapy, consultation or test, the decision of any plan to authorize or deny services, or the process that the plan or any person contracting with the plan uses or proposes to use, to authorize or deny health care services or benefits. Any such prohibition or restriction contained in a contract with a provider entered into after August 28, 1997, shall be void and unenforceable.

(L. 1997 H.B. 335)

354.442. 1. Each enrollee, and upon request each prospective enrollee prior to enrollment, shall be supplied with written disclosure information. In the event of any inconsistency between any separate written disclosure statement and the enrollee contract or evidence of coverage, the terms of the enrollee contract or evidence of coverage shall be controlling. The information to be disclosed in writing shall include at a minimum the following:

(1) A description of coverage provisions, health care benefits, benefit maximums, including benefit limitations;

(2) A description of any exclusions of coverage, including the definition of medical necessity used in determining whether benefits will be covered;

(3) A description of all prior authorization or other requirements for treatments and services;

(4) A description of utilization review policies and procedures used by the health maintenance organization, including:

(a) The circumstances under which utilization review shall be undertaken;

(b) The toll-free telephone number of the utilization review agent;

(c) The time frames under which utilization review decisions shall be made for prospective, retrospective and concurrent decisions;

(d) The right to reconsideration;

(e) The right to an appeal, including the expedited and standard appeals processes and the time frames for such appeals;

(f) The right to designate a representative;

(g) A notice that all denials of claims shall be made by qualified clinical personnel and that all notices of denial shall include information about the basis of the decision; and

(h) Further appeal rights, if any;

(5) An explanation of an enrollee's financial responsibility for payment of premiums, coinsurance, co-payments, deductibles and any other charge, annual limits on an enrollee's financial responsibility, caps on payments for covered services and financial responsibility for noncovered health care procedures, treatments or services provided within the health maintenance organization;

(6) An explanation of an enrollee's financial responsibility for payment when services are provided by a health care provider who is not part of the health maintenance organization's network or by any provider without required authorization, or when a procedure, treatment or service is not a covered health care benefit;

(7) A description of the grievance procedures to be used to resolve disputes between a health maintenance organization and an enrollee, including:

(a) The right to file a grievance regarding any dispute between an enrollee and a health maintenance organization;

(b) The right to file a grievance when the dispute is about referrals or covered benefits;

(c) The toll-free telephone number which enrollees may use to file a grievance;

(d) The department of insurance's toll-free consumer complaint hot line number;

(e) The time frames and circumstances for expedited and standard grievances;

(f) The right to appeal a grievance determination and the procedures for filing such an appeal;

(g) The time frames and circumstances for expedited and standard appeals;

(h) The right to designate a representative;

(i) A notice that all disputes involving clinical decisions shall be made by qualified clinical personnel; and

(j) All notices of determination shall include information about the basis of the decision and further appeal rights, if any;

(8) A description of a procedure for providing care and coverage twenty-four hours a day, seven days a week, for emergency services. Such description shall include the definition of emergency services and emergency medical condition, notice that emergency services are not subject to prior approval, and shall describe the enrollee's financial and other responsibilities regarding obtaining such services, including when such services are received outside the health maintenance organization's service area;

(9) A description of procedures for enrollees to select and access the health maintenance organization's primary and specialty care providers, including notice of how to determine whether a participating provider is accepting new patients;

(10) A description of the procedures for changing primary and specialty care providers within the health maintenance organization;

(11) Notice that an enrollee may obtain a referral for covered services to a health care provider outside of the health maintenance organization's network or panel when the health maintenance organization does not have a health care provider with appropriate training and experience in the network or panel to meet the particular health care needs of the enrollee and the procedure by which the enrollee may obtain such referral;

(12) A description of the mechanisms by which enrollees may participate in the development of the policies of the health maintenance organization;

(13) Notice of all appropriate mailing addresses and telephone numbers to be utilized by enrollees seeking information or authorization;

(14) A listing by specialty, which may be in a separate document that is updated annually, of the names, addresses and telephone numbers of all participating providers, including facilities, and in addition in the case of physicians, board certification; and

(15) The director of the department of insurance shall develop a standard credentialing form which shall be used by all health carriers when credentialing health care professionals in a managed care plan. If the health carrier demonstrates a need for additional information, the director of the department of insurance may approve a supplement to the standard credentialing form. All forms and supplements shall meet all requirements as defined by the National Committee of Quality Assurance.

2. Each health maintenance organization shall, upon request of an enrollee or prospective enrollee, provide the following:

(1) A list of the names, business addresses and official positions of the membership of the board of directors, officers, controlling persons, owners or partners of the health maintenance organization;

(2) A copy of the most recent annual certified financial statement of the health maintenance organization, including a balance sheet and summary of receipts and disbursements prepared by a certified public accountant;

(3) A copy of the most recent individual, direct pay enrollee contracts;

(4) Information relating to consumer complaints compiled annually by the department of insurance;

(5) The procedures for protecting the confidentiality of medical records and other enrollee information;

(6) An opportunity to inspect drug formularies used by such health maintenance organization and any financial interest in a pharmacy provider utilized by such organization. The health maintenance organization shall also disclose the process by which an enrollee or his representative may seek to have an excluded drug covered as a benefit;

(7) A written description of the organizational arrangements and ongoing procedures of the health maintenance organization's quality assurance program;

(8) A description of the procedures followed by the health maintenance organization in making decisions about the experimental or investigational nature of individual drugs, medical devices or treatments in clinical trials;

(9) Individual health practitioner affiliations with participating hospitals, if any;

(10) Upon written request, written clinical review criteria relating to conditions or diseases and, where appropriate, other clinical information which the organization may consider in its utilization review. The health maintenance organization may include with the information a description of how such information will be used in the utilization review process;

(11) The written application procedures and minimum qualification requirements for health care providers to be considered by the health maintenance organization;

(12) A description of the procedures followed by the health maintenance organization in making decisions about which drugs to include in the health maintenance organization's drug formulary.

3. Nothing in this section shall prevent a health maintenance organization from changing or updating the materials that are made available to enrollees.

(L. 1997 H.B. 335)

354.443. 1. A health maintenance organization shall disclose to the department of insurance all financial arrangements, financial interest in, or contractual provisions with utilization review companies or any other health care provider that would encourage or limit the type, amount, duration and scope of services offered, restrict or limit referral or treatment to patients, including but not limited to financial incentives to limit, restrict or deny access to or delivery of medical or other services prior to the delivery of such services. Capitation arrangements between health maintenance organizations and health care providers shall not be considered an inducement to limit, restrict or deny access to medical services. The director shall review all financial arrangements filed with the department of insurance to determine if such arrangements offer an inducement to a provider to provide less than medically necessary services to an enrollee.

2. The capitation rate to be paid from the health maintenance organization to the health care provider is not required to be included with the financial arrangements to be filed with the department of insurance pursuant to subsection 1 of this section.

(L. 1997 H.B. 335)

354.444. 1. If the director determines that a person has engaged, is engaged in, or has taken a substantial step toward engaging in an act, practice or course of business constituting a violation of sections 354.400 to 354.636, or a rule adopted or order issued pursuant thereto or that a person has materially aided or is materially aiding an act, practice, omission, or course of business constituting a violation of sections 354.400 to 354.636 or a rule adopted or order issued pursuant thereto, the director may issue such administrative orders as authorized under section 374.046, RSMo. A violation of any of these sections is a level one violation under section 374.049, RSMo.

2. If the director believes that a person has engaged, is engaging in, or has taken a substantial step toward engaging in an act, practice or course of business constituting a violation of sections 354.400 to 354.636, or a rule adopted or order issued pursuant thereto or that a person has materially aided or is materially aiding an act, practice, omission, or course of business constituting a violation of sections 354.400 to 354.636 or a rule adopted or order issued pursuant thereto, the director may maintain a civil action for relief authorized under section 374.048, RSMo. A violation of any of these sections is a level one violation under section 374.049, RSMo.

(L. 1997 H.B. 335, A.L. 2007 S.B. 66)

354.445. Every health maintenance organization shall establish and maintain a complaint system which provides reasonable procedures for the resolution of written complaints initiated by enrollees.

(L. 1983 H.B. 127)

354.450. With the exception of investments made in accordance with subdivisions (1) and (2) of subsection 1 of section 354.415 and subsection 2 of section 354.415, the investable funds of a health maintenance organization shall be invested only in securities or other investments permitted by the laws of this state for the investment of assets constituting the legal reserves of life insurance companies, or such other securities or investments as the director may permit.

(L. 1983 H.B. 127)

354.455. Unless otherwise provided in sections 354.400 to 354.636, each health maintenance organization shall deposit with the director, or with any organization or trustee acceptable to him through which a custodial or controlled account is utilized, cash, securities, or any combination of these or other measures acceptable to him, in the amount set forth in section 354.410.

(L. 1983 H.B. 127, A.L. 2007 S.B. 66)

354.460. No health maintenance organization, or representative thereof, may cause or knowingly permit the use of advertising which is untrue or misleading, solicitation which is untrue or misleading, or any form of evidence of coverage which is deceptive. For purposes of sections 354.400 to 354.636:

(1) A statement or item of information shall be deemed to be untrue if it does not conform to fact in any respect which is or may be significant to an enrollee of, or person considering enrollment with, a health maintenance organization;

(2) A statement or item of information shall be deemed to be misleading, whether or not it may be literally untrue, if, in the total context in which such statement is made or such item of information is communicated, such statement or item of information may be reasonably understood by a reasonable person, not possessing special knowledge regarding health care coverage, as indicating any benefit or advantage or the absence of any exclusion, limitation, or disadvantage of possible significance to an enrollee of, or person considering enrollment in, a health maintenance organization plan, if such benefit, advantage, or absence of limitation, exclusion, or disadvantage does not, in fact, exist;

(3) An evidence of coverage shall be deemed to be deceptive if the evidence of coverage, taken as a whole, is misleading.

(L. 1983 H.B. 127 § 354.460 subsec. 1, A.L. 2007 S.B. 66)

354.462. An enrollee may not be disenrolled nor denied renewal except for the failure to pay the charge for such coverage, for fraudulent misuse of the system, for abusive conduct, for failure to establish a proper patient-physician relationship, or for such other reasons as may be allowed in rules promulgated by the director.

(L. 1983 H.B. 127 § 354.460 subsec. 2)

354.464. No health maintenance organization, unless licensed as an insurer, may use in its name, contracts, or literature any of the words "insurance", "casualty", "surety", "mutual", or any other words descriptive of the insurance, casualty, or surety business or deceptively similar to the name or description of any insurance or surety corporation doing business in this state when such words are deceptive or misleading. No person, if not in possession of a valid certificate of authority issued pursuant to sections 354.400 to 354.636, may use the phrase "health maintenance organization" or "HMO" in the course of its operation.

(L. 1983 H.B. 127 § 354.460 subsec. 3, A.L. 2007 S.B. 66)

354.465. 1. The director, or any duly appointed representative, may make an examination of the affairs of any health maintenance organization as often as he deems it necessary for the protection of the interests of the people of this state, but not less frequently than once every three years.

2. All costs incu