§ 27-7.1-20 - Cost control – Insurers.
SECTION 27-7.1-20
§ 27-7.1-20 Cost control – Insurers.– The director is authorized, at his or her discretion, to conduct audits andinvestigations to examine the insurer's utilization of adequate programs tocontrol costs or expenses or to collect the appropriate premium charges. On thebasis of information submitted in any filing made pursuant to this chapter, orobtained from the department of labor and training and/or by independentinvestigation, the director shall make a finding whether or not the insurer orinsurers employ cost control programs and techniques that meet the standards ofthe rating agency, or any other standards as may, after notice and a hearing,be approved by the director, which have had or are expected to have asubstantial impact on fraudulent claim costs, unnecessary health care costs,and any other unreasonable costs and expenses, and on the collection of theappropriate premium charges owed to the insurer or insurers. If the directordoes not find adequate utilization of cost control, the director may impose anappropriate penalty not to exceed five percent (5%) of the insurer's annualpremium.