The Office of Insurance Regulation is updating Chapter 69O-194.

 

DEPARTMENT OF FINANCIAL SERVICES

OIR – Insurance Regulation

RULE NOS.:RULE TITLES:

69O-194.001Scope

69O-194.002Definitions

69O-194.003Application

69O-194.005Prepaid Health Clinic Contract

69O-194.009Reporting Requirements

69O-194.010Fees

69O-194.030Forms Incorporated by Reference

PURPOSE AND EFFECT: The Office of Insurance Regulation is updating Chapter 69O-194.

SUMMARY: 69O-194.001 and .030 are repealed. 69O-194.002 and .005 are amended to correct references of “PHAGE” to “PHC.” 69O-194.003 is amended to transfer all aspects of the applications process from other rules in the chapter to one single rule. 69O-194.009 is amended to correct references of “PHAGE” to “PHC,” delete the Monthly Marketing Statistical Report, and incorporate electronic versions of the annual report. 69O-194.010 is amended to delete reference to the Department of Health.

SUMMARY OF STATEMENT OF ESTIMATED REGULATORY COSTS AND LEGISLATIVE RATIFICATION:

The Agency has determined that this will not have an adverse impact on small business or likely increase directly or indirectly regulatory costs in excess of $200,000 in the aggregate within one year after the implementation of the rule. A SERC has not been prepared by the Agency.

The Agency has determined that the proposed rule is not expected to require legislative ratification based on the statement of estimated regulatory costs or if no SERC is required, the information expressly relied upon and described herein: The Agency has determined that the proposed rule is not expected to require legislative ratification based on the statement of estimated regulatory costs or if no SERC is required, the information expressly relied upon and described herein: Agency personnel familiar with the subject matter of the rule amendment have performed an economic analysis of the rule amendment that shows that the rule amendment is unlikely to have an adverse impact on the State economy in excess of the criteria established in Section 120.541(2)(a), Florida Statutes.

Any person who wishes to provide information regarding a statement of estimated regulatory costs, or provide a proposal for a lower cost regulatory alternative must do so in writing within 21 days of this notice.

RULEMAKING AUTHORITY: 641.403, 641.41(1) FS.

LAW IMPLEMENTED: 641.402, 641.405, 641.406, 641.408, 641.412, 641.418, 641.42, 641.421, 641.441 FS.

IF REQUESTED WITHIN 21 DAYS OF THE DATE OF THIS NOTICE, A HEARING WILL BE SCHEDULED AND ANNOUNCED IN THE FAR.

THE PERSON TO BE CONTACTED REGARDING THE PROPOSED RULE IS: Michael Lawrence, Jr., Chief Legal Counsel, Office of Insurance Regulation, [e-mail], [phone].

 

THE FULL TEXT OF THE PROPOSED RULE IS:

 

69O-194.001 Scope.

Rulemaking Authority 641.403 FS. Law Implemented 641.403 FS. History–New 5-9-85, Formerly 4-69.01, 4-69.001, 4-194.001, Repealed ______________.

 

69O-194.002 Definitions.

(1) through (2) No change.

(3) Basic Services. Basic services include any of the following services which if offered shall meet the definitions in paragraphs (a) through (d) of this subsection:

(a) through (c) No change.

(d) Preventive Health Care Services. A program of health evaluation, education and immunizations shall be provided which is designed to prevent illness and disease and to improve the general health of PHC subscribers. This program shall include at least the following:

1. through 3. No change.

4. Eye and ear examinations for children through age 17, to determine the need for vision and hearing correction; and,

5. No change.

(4) Assets.

(a) Assets Defined. In any determination of the financial condition of a PHC prepaid health clinic, there shall be allowed as “assets” only those assets that are owned by the PHC prepaid health clinic and which assets consist of:

1. No change.

2. Investments, securities, properties, and loans acquired or held in accordance with part III, chapter 641, Florida Statutes, and in connection therewith the following items:

a. through c. No change.

d. Interest due or accrued on deposits or certificates of deposit in solvent banks, savings and loan associations, and trust companies domiciled in the United States, and interest due or accrued on other assets, if such interest is in the judgment of the Office department a collectible asset.

e. Interest due or accrued on current mortgage loans, in an amount not exceeding in any event the amount, if any, of the excess of the value of the property less delinquent taxes thereon over the unpaid principal; but in no event shall interest accrued for a period in excess of 90 days be allowed as an asset.

f. through g. No change.

3. Premiums in the course of collection, not more than 3 months past due, less commissions payable thereon. This The foregoing limitation shall not apply to premiums payable directly or indirectly by any governmental body in the United States or by any of their instrumentalities.

4. Furniture, fixtures, furnishings, vehicles, medical libraries, and equipment, if the original cost of each item is at least $200, which cost shall be amortized in full over a period not to exceed 5 calendar years, unless otherwise approved by the Office department.

5. through 6. No change.

7. Other assets, not inconsistent with the provisions of this rule, deemed by the Office department to be available for the payment of benefits and claims, at values to be determined by it.

(b) Evaluation of Assets. The Office, upon determining that a PHC’s PHAGE’s asset has not been evaluated according to applicable law or that it does not qualify as an asset, shall require the PHC to reevaluate the asset properly or to replace the asset with an asset acceptable to the Office within 90 days of this determination, if the removal of the asset from the PHC’s PHAGE’s assets would impair the PHC’s PHAGE’s solvency.

(c) Assets Not Allowed. In addition to assets impliedly excluded by the provisions of paragraph (a) of subsection (4), above, the following expressly shall not be allowed as assets in any determination of the financial condition of a PHC prepaid health clinic:

1. through 2. No change.

3. Stock of the PHC owned by it directly, or owned indirectly by it through any entity in which the PHC owns or controls, directly or indirectly, more than 25 percent of the ownership interest therein.

4. through 8. No change.

(5) Liabilities.

(a) In any determination of the financial condition of a PHC prepaid health clinic, liabilities to be charged against its assets shall include:

1. through 3. No change.

(b) Evaluation of liabilities. The Office, upon determining that a PHC has failed to report liabilities that should have been reported, shall require a corrected report which reflects the proper liabilities to be submitted by the PHC to the Office within 10 working days of receipt of notification.

(6) No change.

(7) Surplus Notes. Surplus notes must meet the following requirements:

(a) They must be subordinated to the Florida minimum surplus requirement as provided for in Section 641.407, F.S.; and

(b) They must be subordinated to all other liabilities; and,

(c) No change.

(8) Actuarily Sound. Means “Actuarially Sound” means the ability of the proposed PHC to deliver all the services to be furnished by the PHC at the rate structure established including administrative costs, which shall be defined as general and administrative expenses for the PHC. Actuarial soundness will be determined by the department based on a review of the actuarial study under which the rates and loss reserves are established. Consideration will be given to the character and amount of guaranteed services by the organizers, the method of marketing, and the degree of market penetration that can reasonably be expected.

(9) Excessive, Inadequate or Unfairly Discriminatory Rates. A rate shall be deemed to be excessive if the rate is unreasonably high for the services provided when compared with the cost for similar health care services in the community. A rate shall be deemed to be inadequate if the continued use of the rate endangers the solvency of the PHC using it, or if continued use by the PHC has or will have the effect of being unfair competition or creating a monopoly. This provision is designed to promote efficient and effective operation of PHC’s PHAGE’s. A rate shall be deemed to be unfairly discriminatory if the PHC knowingly makes or permits any unfair discrimination between individuals of the same actuarially supportable class and essentially the same hazard, in the amount of premium, policy fees, rates charged, or benefits payable under the terms or conditions of the contract, or in any other manner whatever.

(10) No change.

Rulemaking Authority 641.403 FS. Law Implemented 641.402(1), 641.405, 641.406, 641.418, 641.42, 641.441, 641.515 FS. History–New 5-9-85, Formerly 4-69.02, 4-69.002, 4-194.002, Amended ________________.

 

69O-194.003 Prepaid Health Clinic Application.

 

Substantial rewording of Rule 69O-194.003, F.A.C. follows.  See Florida Administrative Code for present text.

 

(1) An application for a person applying for a certificate of authority as a prepaid health clinic consists of the following:

(a) Form OIR-C1-483, “Application for Certificate of Authority Prepaid Health Clinic,” effective 6/20, hereby incorporated by reference and available at www.flrules.org/XXXXX;

(b) Form OIR-C1-905, “Instructions for Furnishing Background Investigative Reports,” effective 6/20, hereby incorporated by reference and available at www.flrules.org/XXXXX;

(c) Form OIR-C1-938, “Fingerprint Payment and Submission Procedures,” effective 6/20, hereby incorporated by reference and available at www.flrules.org/XXXXX; and

(d) Form OIR-C1-1423, “Biographical Affidavit,” effective 6/20, hereby incorporated by reference and available at www.flrules.org/XXXXX.

(2) A person applying for a certificate of authority as a prepaid health clinic shall submit forms in subsection (1) as directed by the Office electronically at https://www.floir.com/iportal.

Rulemaking Authority 641.403 FS. Law Implemented 641.405, 641.406 FS. History–New 5-9-85, Formerly 4-69.03, 4-69.003, 4-194.003, Amended ________________.

 

69O-194.005 Prepaid Health Clinic Contract.

(1)(a) “Prepaid health clinic” or “PHC contract” means the certificate or contract provided to the subscriber which describes the health care services provided and the amount to be charged. Every subscriber shall be given a PHC contract unless subsection (2) of this rule applies.

(b) Both individual and family prepaid health clinic contracts must contain the entire agreement between the PHC and the subscriber, including but not limited to: date of contract; rate to be charged; mode of payment, which shall be monthly; grace period for late payment; copayment features, if any; renewal conditions; services to be furnished; names and addresses of the clinics or other facilities at which services are available; provisions pertaining to pre-existing conditions; limitations; exclusions and exceptions, such as waiting periods, specific conditions not covered and limitations on length of stay, enrollment and disenrollment procedures, and all other qualifying or limiting features; provisions pertaining to amount and kind of reimbursement made if the illness or accident happens outside of the PHC’s PHAGE’s geographic area and an explanation of this coverage; provisions for adding new family members; and any other information necessary for a complete understanding of what is covered and what is excluded by the contract.

(2) through (3) No change.

(4) All prepaid health clinic contracts must be clear and legible. All limitations, exclusions, and exceptions must be grouped together with captions in bold-faced type and shall be printed with at least the same prominence as provisions which describe the benefits.

Rulemaking Authority 641.403 FS. Law Implemented 641.42, 641.405, 641.406, 641.408, 641.421 FS. History–New 5-9-85, Formerly 4-69.05, 4-69.005, 4-194.005, Amended ________________.

 

69O-194.009 Reporting Requirements.

 

Substantial rewording of Rule 69O-194.009, F.A.C. follows.  See Florida Administrative Code for present text.

 

(1) Each PHC shall file with the Office a full and true report of its financial condition, transactions, and affairs.

(a) An annual report covering the preceding fiscal year shall be filed on or before April 1 or within 3 months of the end of the reporting period of the clinic.

1. The executed Jurat page of said report shall be transmitted electronically to the Office via the Regulatory Electronic Filing System, “REFS.” The date affixed by the Office’s electronic data processing system shall serve as evidence of the timeliness of the report. A report in any other format shall not be submitted to the Office.

2. Each PHC shall submit its report electronically to the National Association of Insurance Commissioners in accordance with the electronic filing instructions incorporated by reference in paragraph 69O-137.001(3)(b), F.A.C.

3. The report shall be prepared in accordance with the manuals incorporated by reference in paragraph 69O-137.001(4)(a), F.A.C.

4. Copies of the manuals are available:

a. From the National Association of Insurance Commissioners at http://www.naic.org and

b. For inspection during regular business hours at the Office of Insurance Regulation, Larson Building, 200 East Gaines Street, Tallahassee, Florida 32399-0300.

(b) Form OIR-A2-949, “Annual Report Contracts Issued & Outstanding,” effective 12/20, hereby incorporated by reference and available www.flrules.org/XXXXX.  Form OIR-A2-949 shall be submitted electronically on or before April 1 or within 3 months of the end of the reporting period of the clinic via the Office’s system at https://www.floir.com/iportal.

(c) Form OIR-A2-950, “Annual Report Damage Claims & Medical Injury,” effective 12/20, hereby incorporated by reference and available at www.flrules.org/XXXXX.  Form OIR-A2-950 shall be submitted electronically on or before April 1 or within 3 months of the end of the reporting period of the clinic via the Office’s system at https://www.floir.com/iportal.

(2) The Office shall grant an extension of time to file an annual report in subsection (1) if there exist conditions beyond the control of the authorized PHC, such as rehabilitation pursuant to section 641.419, F.S., or the laws of the state of domicile; severe damage to the PHC’s physical premises by a natural or man-made disaster; or some other reason of similar gravity and severity. The request for an extension of time for filing an annual report shall be submitted to the Office at least 10 days before the filing is due. The extension shall be for the amount of time reasonable to file under the conditions which justified the extension.

Rulemaking Authority 641.403, 641.41(1) FS. Law Implemented 641.41 FS. History–New 5-9-85, Formerly 4-69.09, 4-69.009, 4-194.009, Amended ________________.

 

69O-194.010 Fees.

Checks for the original filing or amendments thereto, and for filing of each annual report shall be made payable to the “Chief Financial Officer, State of Florida.” The portion allotted to the Department of Health shall then be remitted to that Department by the Chief Financial Officer.

Rulemaking Authority 641.403 FS. Law Implemented 641.412 FS. History–New 5-9-85, Formerly 4-69.10, 4-69.010, 4-194.010, Amended ________________.

 

69O-194.030 Forms Incorporated by Reference.

Rulemaking Authority 641.403 FS. Law Implemented 624.424, 624.501(26), 641.402, 641.405, 641.41, 641.416 FS. History–New 6-25-90, Formerly 4-69.081, 4-194.030, Amended 7-30-17, Repealed ______________.

 

NAME OF PERSON ORIGINATING PROPOSED RULE: Michael Lawrence, Jr., Chief Legal Counsel

NAME OF AGENCY HEAD WHO APPROVED THE PROPOSED RULE: Financial Services Commission

DATE PROPOSED RULE APPROVED BY AGENCY HEAD: March 29, 2022

DATE NOTICE OF PROPOSED RULE DEVELOPMENT PUBLISHED IN FAR: June 15, 2021