40-3203. Certificate of authority required; application; contents; rules and regulations governing modifications and amendments; approval of commissioner.
40-3203
40-3203. Certificate of authority required;application;contents; rules and regulations governing modifications and amendments;approval of commissioner.(a) Except as otherwise provided by this act, it shall be unlawful forany person to provide health care services in the manner prescribed insubsection (n) or subsection (r) of K.S.A. 40-3202 and amendments theretowithoutfirstobtaining a certificate of authority from the commissioner.
(b) Applications for a certificate of authority shall be made in theform required by the commissioner and shall be verified by an officer orauthorized representative of the applicant and shall set forth or beaccompanied by:
(1) A copy of the basic organizational documents of the applicantsuch as articles of incorporation, partnership agreements, trustagreements or other applicable documents;
(2) a copy of the bylaws, regulations or similar document, if any,regulating the conduct of the internal affairs of the applicant;
(3) a list of the names, addresses, official capacity with theorganization and biographical information for all of the personswho are to be responsible for theconduct of its affairs, including all members of the governing body, theofficers and directors in the case of a corporation and the partnersor members in the case of a partnership or corporation;
(4) a sample or representative copy of any contract or agreement made orto be made between thehealth maintenance organization or medicare provider organization and anyclass of providers and a copy of any contract made or agreement made orto be made, excluding individual employment contracts or agreements,between third party administrators, marketing consultants or personslisted in subsection (3) and the health maintenance organization or medicareprovider organization;
(5) a statement generally describing the organization, itsenrollment process, its operation, its quality assurance mechanism, itsinternal grievance procedures, in the case of a health maintenanceorganization the methods it proposes to use to offerits enrollees an opportunity to participate in matters of policy andoperation, the geographic area or areas to be served, the location andhours of operation of the facilities at which health care services willbe regularly available to enrollees in the case of staff and grouppractices, the type and specialty of healthcare personnel and the number of personnel in each specialty categoryengaged to provide health care services in the case of staff and grouppractices, and a records system providing documentationof utilization rates for enrollees. In cases other than staff and grouppractices, the organization shall provide a list of names, addresses andtelephone numbers of providers by specialty;
(6) copies of all contract forms the organization proposes toofferenrollees together with a table of rates to be charged;
(7) the followingstatements of the fiscal soundness of the organization:
(A) Descriptions of financing arrangements for operational deficitsand for developmental costs if operational one year or less;
(B) a copy of the most recent unaudited financial statements of thehealth maintenance organization or medicare provider organization;
(C) financial projections in conformity with statutory accounting practicesprescribed or otherwise permitted by the department of insurance of the stateofdomicile for a minimum of three years from the anticipateddate of certification and on a monthly basis from the date of certificationthrough one year. If the health maintenance organization or medicareprovider organization is expected toincur a deficit, projections shall be made for each deficit year and forone year thereafter. Financial projections shall include:
(i) Monthly statements of revenue and expense for the first year on agross dollar as well as per-member-per-month basis, with quartersconsistent with standard calendar year quarters;
(ii) quarterly statements of revenue and expense for each subsequent year;
(iii) a quarterly balance sheet; and
(iv) statement and justification of assumptions;
(8) a description of the procedure to be utilized by a healthmaintenance organization or medicare provider organization to provide for:
(A) Offering enrollees anopportunity to participate in matters of policy and operation of ahealth maintenance organization;
(B) monitoring of the quality of careprovided by such organization including, as a minimum, peer review; and
(C) resolving complaints and grievances initiated by enrollees;
(9) a written irrevocable consent duly executed by suchapplicant,if the applicant is a nonresident, appointing the commissioner as theperson upon whom lawful process in any legal action against suchorganization on any cause of action arising in this state may be servedand that such service of process shall be valid and binding in the sameextent as if personal service had been had and obtained upon saidnonresident in this state;
(10) a plan, in the case of group or staff practices, that willprovide for maintaining a medical recordssystem which is adequate to provide an accurate documentation ofutilization by every enrollee, such system to identify clearly, at aminimum, each patient by name, age and sex and to indicate clearly theservices provided, when, where, and by whom, the diagnosis, treatmentand drug therapy, and in all other cases, evidence that contracts withproviders require that similar medical records systems be in place;
(11) evidence of adequate insurance coverage or an adequateplan forself-insurance to respond to claims for injuries arising out of thefurnishing of health care;
(12) such other information as may be required by thecommissioner to make the determinations required by K.S.A. 40-3204 andamendments thereto; and
(13) in lieu of any of the application requirements imposed by this sectionon a medicare provider organization, the commissioner may accept any report orapplication filed by the medicare provider organization with the appropriateexamining agency or official of another state or agency of the federalgovernment.
(c) The commissioner may promulgate rules and regulations the commissionerdeems necessary to the proper administration of this act to require a healthmaintenance organization or medicare provider organization, subsequent toreceiving its certificate of authorityto submit the information, modifications or amendments to the items describedin subsection (b) to the commissioner prior to the effectuation of themodification or amendment or to require the health maintenance organization toindicate the modifications to the commissioner. Any modification or amendmentforwhich the approval of the commissioner is required shall be deemed approvedunless disapproved within 30 days, except the commissioner may postpone theaction for such further time, not exceeding an additional 30 days, as necessaryfor proper consideration.
History: L. 1974, ch. 181, § 3; L. 1976, ch. 280, § 22;L. 1985, ch. 208, § 3;L. 1988, ch. 162, § 1;L. 1996, ch. 169, § 7;L. 1997, ch. 13, § 1;L. 1998, ch. 174, § 14; July 1.