Chapter 63. Health Service Corporations
TITLE 18
Insurance Code
Insurance
CHAPTER 63. HEALTH SERVICE CORPORATIONS
§ 6301. Provisions exclusive.
Health service corporations now or hereafter incorporated in this State shall be governed by this chapter, shall be exempt from all other provisions of this title, except as herein expressly provided, and no insurance law hereafter enacted shall be deemed to apply to such corporations unless they be specifically referred to therein.
18 Del. C. 1953, § 6301; 56 Del. Laws, c. 380, § 1.;
§ 6302. Health service corporation defined.
"Health service corporation" means a nonprofit corporation, without capital stock, organized under the laws of this State for the purpose of establishing, maintaining and operating plans to provide hospital, physicians' or related health services, or indemnity therefor, for such persons as become members or subscribers of any plan of such corporation.
18 Del. C. 1953, § 6302; 56 Del. Laws, c. 380, § 1.;
§ 6303. Limited application.
This chapter, other than § 6301 of this title, shall not apply to any corporation operating or maintaining a hospital service plan or medical service plan, participation in which is limited to its employees and the employees of other persons or corporations with which such corporation may have contracted to provide such services. As used in this section, the term "employees" may include members of the families of employees and retired employees.
18 Del. C. 1953, § 6303; 56 Del. Laws, c. 380, § 1.;
§ 6304. Certificate of authority; when required; application.
(a) No corporation shall engage in the business of a health service corporation without first obtaining a certificate of authority therefor from the Commissioner, except that this provision shall not apply to corporations which are engaged in such business in this State on November 1, 1968.
(b) Application for a certificate of authority as a health service corporation shall be made on forms supplied by the Commissioner and containing such information as the Commissioner shall reasonably deem necessary. The application shall be accompanied by a filing fee of $25 and copies of the following documents:
(1) Certificate of incorporation;
(2) Bylaws;
(3) Forms of all proposed contracts between the applicant and participating hospitals, physicians and other providers of health services showing the terms under which services are to be furnished to subscribers or members;
(4) Forms of all proposed contracts and optional riders to be offered for subscribers or members;
(5) Tables of rates to be charged for each such contract or rider or a statement of the rating formulas to be used in lieu of fixed rates;
(6) Financial statement of the corporation, including the amounts of contributions paid or agreed to be paid to the corporation for working capital and the name or names of each contributor and the terms of each contribution;
(7) A statement of the areas in which the corporation proposes to operate; and
(8) A list of the names and addresses of the members of the board of directors or other governing body of the corporation and its principal officers.
(c) Every corporation engaging in the business of a health service corporation pursuant to the exception stated in subsection (a) above, shall, within 30 days after November 1, 1968, file with the Commissioner copies of all the documents referred to in paragraphs (1)-(8) of subsection (b), above, and pay therewith a filing fee of $25.
18 Del. C. 1953, § 6304; 56 Del. Laws, c. 380, § 1; 70 Del. Laws, c. 186, § 1.;
§ 6305. Issuance of certificate of authority.
The Commissioner shall issue a certificate of authority to the applicant when it is shown to the Commissioner's satisfaction that:
(1) The applicant is established as a bona fide nonprofit health service corporation;
(2) Arrangements have been made by the applicant reasonably to assure provision of the services covered by its contracts and riders;
(3) The amounts provided as working capital of the corporation are repayable, without interest, only out of operating revenues;
(4) The amount of money actually available for working capital is sufficient to carry on the plan for a period of 2 months from the date of issuance of the certificate of authority.
18 Del. C. 1953, § 6305; 56 Del. Laws, c. 380, § 1; 70 Del. Laws, c. 186, § 1.;
§ 6306. Filing required for contract or rate changes.
No new or changed contract or rider shall be offered to the public and no new or changed rate or rating formula shall be charged or employed, unless documentation with respect thereto as specified in § 6304(b) of this title is first filed with the Commissioner.
18 Del. C. 1953, § 6306; 56 Del. Laws, c. 380, § 1.;
§ 6307. Annual report; examination.
(a) Not later than the 1st day of March of each year every such corporation shall file with the Commissioner a statement sworn to by at least 2 of its principal officers, showing its financial condition on the last day of the next preceding calendar year. Such statement shall be in the general form as is currently in general and customary use in the United States for health insurance and may be submitted on standard office-size paper.
(b) The Commissioner may appoint an examiner to examine into the affairs of the corporation. Such person shall have the power of visitation and examination, shall have free access to all the books, papers and documents relating to the business of the corporation and may require the officers, agents or employees thereof, or any other persons, to testify under oath concerning the affairs, transactions and conditions at least every 3 years. Except, that the confidentiality of information relating to the diagnosis and treatment of the members of such corporation shall be strictly maintained by the examiner. The reasonable cost of the examination shall be paid by the corporation upon completion of the examination.
18 Del. C. 1953, § 6307; 56 Del. Laws, c. 380, § 1; 64 Del. Laws, c. 322, § 1; 69 Del. Laws, c. 343, § 1.;
§ 6308. Suspension or revocation of authority to do business.
The Commissioner may, after hearing, suspend or revoke the right to do business or the certificate of authority for any of the following causes:
(1) If the corporation is no longer qualified therefor under this chapter;
(2) For a violation by the corporation of a provision of this chapter; or
(3) Upon any applicable ground under this chapter or any of the chapters specified in § 6309 of this title for which the certificate of authority of an insurer may be suspended or revoked.
18 Del. C. 1953, § 6308; 56 Del. Laws, c. 380, § 1.;
§ 6309. Other provisions applicable.
Such corporations shall be subject to this chapter and to the following chapters of this title, to the extent applicable and not in conflict with the express provisions of this chapter:
(1) Chapter 1 (General Definitions and Provisions).
(2) Chapter 3 (The Insurance Commissioner).
(3) Chapter 23 (Unfair Practices in the Insurance Business).
(4) Chapter 25 (Rates and Rating Organizations).
(5) Chapter 59 (Rehabilitation and Liquidation).
(6) Chapter 34 (Medicare Supplement Insurance Minimum Standards).
(7) Chapter 36 (Individual Health Insurance Minimum Standards).
18 Del. C. 1953, § 6309; 56 Del. Laws, c. 380, § 1; 60 Del. Laws, c. 388, §§ 5, 6; 63 Del. Laws, c. 262, § 4; 64 Del. Laws, c. 142, § 3.;