- Any certificate of authority issued under this chapter may be suspended or revoked, and any application for a certificate of authority may be denied, if the Commissioner finds that any of the conditions listed below exist:
- A health maintenance organization is operating significantly in contravention of its basic organizational document or in a manner inconsistent with this chapter.
- A health maintenance organization issued an evidence of coverage or uses a schedule of charges for health care services which do not comply with the requirements of §§ 31-3407 and 31-3415.
- A health maintenance organization does not provide or arrange for basic health care services.
- The Commissioner certifies that:
- A health maintenance organization does not meet the requirements of § 31-3403(b); or
- A health maintenance organization is unable to fulfil its obligations to furnish health care services.
- A health maintenance organization is no longer financially responsible and may reasonably be expected to be unable to meet its obligations to enrollees or prospective enrollees.
- A health maintenance organization has failed to correct, within the time prescribed by subsection (c) of this section, any deficiency occurring due to such health maintenance organization's prescribed minimum net worth being impaired.
- A health maintenance organization has failed to implement the grievance procedure required by § 31-3410 in a reasonable manner to resolve valid complaints.
- A health maintenance organization, or any person authorized to act on its behalf, has advertised or merchandised its services in an untrue, misrepresentative, misleading, deceptive, or unfair manner.
- The continued operation of a health maintenance organization would be dangerous to its enrollees.
- The health maintenance organization has otherwise failed substantially to comply with this chapter.
- The health maintenance organization has filed, caused to be filed, or failed to prevent the filing of, a statement on its behalf from an independent organization attesting to its qualifications to transact business in the District for which it sought and received a certificate of authority if it knew, or should have known, that the statement was based on false, misleading, or incomplete information.
- The health maintenance organization has filed, caused to be filed, or failed to prevent the filing of a statement on its behalf by a corporate officer attesting to its qualifications to transact business in the District for which it sought and received a certificate of authority if it knew, or should have known, that the statement was based on false, misleading, or incomplete information.
- A health maintenance organization has violated a law of the District, has violated its charter, or has exceeded its corporate powers.
- In addition to, or in lieu of suspension or revocation of a certificate of authority pursuant to this section, the applicant or health maintenance organization may be subject to an administrative penalty of up to $1000 a day for each cause for suspension or revocation.
- The following shall pertain when insufficient net worth is maintained:
- Whenever the Commissioner finds that the net worth maintained by any health maintenance organization subject to the provisions of this chapter is less than the minimum net worth required to be maintained by § 31-3412, the Commissioner shall give written notice to the health maintenance organization of the amount of the deficiency and require:
- Filing with the Commissioner a plan for correction of the deficiency acceptable to the Commissioner; and
- Correction of the deficiency within a reasonable time, not to exceed 60 days, unless an extension of time is granted by the Commissioner.
- Such a deficiency shall be deemed an impairment, and failure to correct the impairment in the prescribed time shall be grounds for suspension or revocation of the certificate of authority or for placing the health maintenance organization in conservation, rehabilitation, or liquidation.
- Except for newborn children, other newly acquired dependents of existing enrollees, or other newly eligible individuals, or as otherwise allowed by the Commissioner, no health maintenance organization or person acting on its behalf may, directly or indirectly, renew, issue, or deliver any certificate, agreement, or contract of coverage in the District, for which a premium dues is charged or collected, when a health maintenance organization writing such coverage is impaired, and the fact of the impairment is known to the health maintenance organization or to the person.
- The existence of an impairment, however, shall not prevent the issuance or renewal of a certificate, agreement, or contract when the enrollee exercises an option granted under the plan to obtain a new, renewed, or converted coverage.
- A certificate of authority shall be suspended or revoked, or an application or a certificate of authority denied, or an administrative penalty imposed only after compliance with the requirements of this section.
- Suspension or revocation of a certificate of authority, the denial of an application, or the imposition of an administrative penalty pursuant to this section shall be by written order and shall be sent to the health maintenance organization or applicant by certified or registered mail. The written order shall state the grounds, charges, or conduct on which suspension, revocation, or denial or administrative penalty is based. A health maintenance organization or applicant may in writing request a hearing within 30 days from the date of mailing of the order. If no written request is made, such order shall be final upon the expiration of the 30 days.
- If a health maintenance organization or applicant requests a hearing pursuant to this section, the Commissioner shall issue a written notice of hearing and send it to the health maintenance organization or applicant by certified or registered mail. The notice shall include the following:
- A specific time for the hearing, which may not be less than 20 days nor more than 30 days after mailing of the notice of hearing; and
- A specific place for the hearing.
- If a hearing is requested, the Commissioner or his designated representative shall be in attendance and shall participate in the proceedings. The recommendations and findings of the Commissioner in respect to matters relating to the quality of health care services provided in connection with any decision regarding denial, suspension, or revocation of a certificate of authority shall be conclusive and binding upon the Mayor.
- After such a hearing, or upon failure of the health maintenance organization to appear at the hearing, the Commissioner shall take whatever action he or she deems necessary based on written findings and shall mail his or her decision to the health maintenance organization or applicant. The action of the Commissioner shall be subject to review under subchapter I of Chapter 5 of Title 2.
- The provisions of the DCAPA shall apply to proceedings under this section.
- When the certificate of authority of a health maintenance organization is suspended, the health maintenance organization shall not, during the period of such suspension, enroll any additional enrollees except newborn children, other newly acquired dependents of existing enrollees, or other newly eligible individuals, and shall not engage in any advertising or solicitation whatsoever.
- When the certificate of authority of a health maintenance organization is revoked, such organization shall proceed, immediately following the effective date of the order or revocation, to wind up its affairs within the District, and shall conduct no further business within the District except as may be essential to the orderly conclusion of the affairs of such organization within the District. It shall engage in no further advertising or solicitation whatsoever within the District. The Commissioner may, by written order, permit such further operation of the organization as the Commissioner may find to be in the best interest of enrollees, to the end that enrollees will be afforded the greatest practical opportunity to obtain continuing health care coverage.
Historical and Statutory
1981 Ed., § 35-4519.
Effect of Amendments
D.C. Law 13-190 added subsec. (a)(11).
D.C. Law 14-190, in subsec. (a), added par. (12).
D.C. Law 14-252, in subsec. (a), added par. (13).
D.C. Law 15-105, in par. (13) of subsec. (a), validated a previously made technical correction.
Emergency Act Amendments
For temporary (90 day) amendment of section, see § 604(b) of Fiscal Year 2003 Budget Support Emergency Act of 2002 (D.C. Act 14-453, July 23, 2002, 49 DCR 8026).
Legislative History of Laws
For legislative history of D.C. Law 11-235, see Historical and Statutory Notes following § 31-3401.
For Law 13-190, see notes following § 31-3403.
For Law 14-190, see notes following § 31-2502.02.
For Law 14-252, see notes following § 31-3402.
For Law 15-105, see notes following § 31-2402.
DC CODE § 31-3419
Current through December 11, 2012
(Apr. 9, 1997, D.C. Law 11-235, § 20, 44 DCR 818; Oct. 21, 2000, D.C. Law 13-190, § 4(b), 47 DCR 7261; Oct. 1, 2002, D.C. Law 14-190, § 604(b), 49 DCR 6968; Mar. 27, 2003, D.C. Law 14-252, § 2(h), 50 DCR 225; Mar. 13, 2004, D.C. Law 15-105, § 66, 51 DCR 881.)