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Ohio Laws and Rules
Chapter 3961: DISCOUNT MEDICAL PLANS
As used in sections 3961.01 to 3961.09 of the Revised Code:
(1) "Discount medical plan" means a business arrangement or contract in which a person, in exchange for fees, dues, charges, or other consideration, offers access to members to providers of medical services and the right to receive discounted medical services from those providers.
(2) "Discount medical plan" does not include any of the following:
(a) A plan that does not require a membership or charge a fee to use the plan's medical card;
(b) A plan that offers discounts for only pharmaceutical supplies or prescription drugs, or both, and no other medical services;
(c) A plan offered by a sickness and accident insurer that is regulated under Title XXXIX of the Revised Code, a health insuring corporation that is regulated under Title XVII of the Revised Code, or an affiliate of such insurer or corporation if the insurer, corporation, or affiliate discloses in writing in not less than twelve-point type on any applications, advertisements, marketing materials, and brochures describing the plan that the plan is not insurance.
(1) "Discount medical plan organization" or "organization" means a person who does business in this state; offers to members access to providers of medical services and the right to receive discounted medical services from those providers; contracts with providers, provider networks, or other discount medical plan organizations to offer discounted medical services to members; and determines the fee members pay to participate in the plan.
(2) "Discount medical plan organization" does not include a sickness and accident insurer that is regulated under Title XXXIX of the Revised Code or a health insuring corporation that is regulated under Title XVII of the Revised Code.
(C) "Facility" means an institution where medical services are performed, including, but not limited to, a hospital or other licensed inpatient center; ambulatory surgical or treatment center; skilled nursing center; residential treatment center; rehabilitation center; diagnostic, laboratory, and imaging center; and any other health care setting.
(D) "Health care professional" means a physician or other health care provider who is licensed, accredited, certified, or otherwise authorized to perform specified medical services within the scope of the person's license, accreditation, certification, or other authorization and performs medical services consistent with the laws of this state.
(1) "Marketer" means a person or entity who markets, promotes, sells, or distributes a discount medical plan, including, but not limited to, a private label entity that places its name on and markets or distributes a discount medical plan pursuant to a written agreement with a discount medical plan organization described under section 3961.03 of the Revised Code.
(2) "Marketer" does not mean a sickness and accident insurer that is regulated under Title XXXIX of the Revised Code, a health insuring corporation that is regulated under Title XVII of the Revised Code, or an affiliate of such insurer or corporation if the insurer, corporation, or affiliate discloses in writing in not less than twelve-point type on any applications, advertisements, marketing materials, and brochures describing the plan that the plan is not insurance.
(F) "Medical services" means any maintenance care of the human body; preventative care for the human body; or care, service, or treatment of an illness or dysfunction of, or injury to, the human body. "Medical services" includes, but is not limited to, physician care, inpatient care, hospital surgical services, emergency services, ambulance services, dental care services, vision care services, pharmaceutical supplies, prescription drugs, mental health services, substance abuse services, chiropractic services, podiatric services, laboratory services, and medical equipment and supplies.
(G) "Member" means any individual who pays fees, dues, charges, or other consideration to a discount medical plan organization for access to providers of medical services and the right to receive the benefits of a discount medical plan.
(H) "Person" means an individual, corporation, partnership, association, joint venture, joint stock company, trust, unincorporated organization, any similar entity, or any combination of these entities.
(I) "Provider" means any health care professional or facility that has contracted, directly or indirectly, with a discount medical plan organization to offer discounted medical services to members.
(J) "Provider agreement" means any agreement entered into between a discount medical plan organization and a provider or provider network to offer discounted medical services to members as described in section 3961.02 of the Revised Code.
(K) "Provider network" means a person that negotiates, directly or indirectly, with a discount medical plan organization on behalf of more than one provider to offer discounted medical services to members.
Effective Date: 03-23-2007 .
(A) A discount medical plan organization shall not offer to members, or advertise to prospective members, discounted medical services unless the services are offered pursuant to a provider agreement. A discount medical plan organization may enter into a provider agreement directly with a provider, indirectly through a provider network to which a provider belongs, or through another discount medical plan organization that contracts with providers directly or through a provider network.
(B) A provider agreement between a discount medical plan organization and a provider shall contain all of the following:
(1) A list of medical services and products offered at a discount;
(2) The discounted rates for medical services or a fee schedule that reflects the provider's discounted rates;
(3) A statement that the provider will not charge members more than the discounted rates described in division (B)(2) of this section.
(C) A provider agreement between a discount medical plan organization and a provider network shall require the provider network to do all of the following:
(1) Maintain an up-to-date list of the provider network's contracted providers and supply that list to the discount medical plan organization on a monthly basis;
(2) Have a written agreement with each provider who offers discounted medical services that contains both of the following:
(a) The items listed in division (B) of this section;
(b) A grant of authority that allows the provider network to contract with discount medical plan organizations on behalf of the provider.
(D) A provider agreement between a discount medical plan organization and another discount medical plan organization shall require that the other discount medical plan organization have provider agreements in place that comply with division (A) of this section and division (B) or (C) of this section, as applicable.
(E) A discount medical plan organization shall keep for the duration of the agreement a copy of each provider agreement into which the organization has entered.
Effective Date: 03-23-2007 .
(A) Prior to a discount medical plan organization allowing a marketer to market, promote, sell, or distribute a discount medical plan, the organization shall enter into a written agreement with the marketer. This agreement shall prohibit the marketer from using or issuing any advertising, marketing materials, brochures, or discount medical cards without the organization's written approval.
(B) A discount medical plan organization is bound by and responsible for a marketer's activities that are within the scope of the marketer's agency relationship with the organization.
(C) A discount medical plan organization shall approve in writing all advertisements, marketing materials, brochures, and discount cards prior to a marketer using these materials to market, promote, sell, or distribute the discount medical plan.
Effective Date: 03-23-2007 .
(A) A discount medical plan organization or marketer shall disclose all of the following information in writing in not less than twelve-point type on the first content page of any advertisements, marketing materials, or brochures made available to the public relating to a discount medical plan and with any enrollment forms:
(1) A statement that the discount medical plan is not insurance;
(2) A statement that the range of discounts for medical services offered under the discount medical plan will vary depending on the type of provider and medical services;
(3) A statement that the discount medical plan is prohibited from making members' payments to providers for medical services received under the discount medical plan;
(4) A statement that the member is obligated to pay for all discounted medical services received under the discount medical plan;
(5) The discount medical plan organization's toll-free telephone number and internet web site address that a member or prospective member may use to obtain additional information about and assistance with the discount medical plan and up-to-date lists of providers participating in the discount medical plan.
(B) If a discount medical plan organization's or marketer's initial contact with a prospective member is by telephone, the organization or marketer shall disclose all of the information listed in division (A) of this section orally in addition to including such disclosures in the initial written materials provided to the prospective or new member.
(C) In addition to the disclosures required under division (A) of this section, a discount medical plan organization shall provide to each prospective member, at the time of enrollment, a copy of the terms and conditions of the discount medical plan, including any limitations or restrictions on the refund of any processing fees or periodic charges associated with the discount medical plan. A discount medical plan organization also shall provide each new member a written document containing the terms and conditions of the discount medical plan and including all of the following:
(1) Name of the member;
(2) Benefits provided under the discount medical plan;
(3) Any processing fees and periodic charges associated with the discount medical plan, including, but not limited to, if applicable, the procedures for changing the mode of payment and any accompanying additional charges;
(4) Any limitations, exclusions, or exceptions regarding the receipt of discount medical plan benefits;
(5) Any waiting periods for certain medical services under the discount medical plan;
(6) Procedures for obtaining discounts under the discount medical plan, such as requiring members to contact the discount medical plan organization to request that the organization make an appointment with a provider on the member's behalf;
(7) Cancellation and refund rights described in section 3961.06 of the Revised Code;
(8) Membership renewal, termination, and cancellation terms and conditions;
(9) Procedures for adding new family members to the discount medical plan;
(10) Procedures for filing complaints under the discount medical plan organization's complaint system and a statement explaining that, if the member remains dissatisfied after completing the organization's complaint system, the member may contact the department of insurance;
(11) Name, mailing address, and toll-free telephone number of the discount medical plan organization that a member may use to make inquiries about the discount medical plan, send cancellation notices, and file complaints.
(D) A discount medical plan organization shall maintain on an internet web site page an up-to-date list of the names and addresses of the providers with which the organization has contracted directly or indirectly through a provider network. The organization's internet web site address shall be prominently displayed on all of the organization's advertisements, marketing materials, brochures, and discount medical plan cards.
(E) When a discount medical plan organization or marketer sells a discount medical plan together with any other product, the organization or marketer shall do either of the following:
(1) Provide the charges for each discount medical plan in writing to the member;
(2) Reimburse the member for all periodic charges for the discount medical plan and all periodic charges for any other product if the member cancels membership in accordance with division (B) of section 3961.06 of the Revised Code.
Effective Date: 03-23-2007; 2008 HB562 09-22-2008 .
A discount medical plan organization shall not do any of the following:
(A) Except when otherwise permitted in sections 3961.01 to 3961.09 of the Revised Code, as a disclaimer of any relationship between discount medical plan benefits and insurance, or in a description of an insurance product connected with a discount medical plan, use the term "insurance" in the organization's advertisements, marketing material, brochures, or discount medical plan cards.
(B) Use in the organization's advertisements, marketing material, brochures, or discount medical plan cards the terms "health plan," "coverage," "benefits," "copay," "copayments," "deductible," "pre-existing conditions," "guaranteed issue," "premium," "PPO," "preferred provider organization," or any other terms in a manner that could mislead a person into believing that the discount medical plan is health insurance.
(C) Make misleading, deceptive, or fraudulent statements or representations regarding the terms or benefits of the discount medical plan, including, but not limited to, statements or representations regarding discounts, range of discounts, or access to those discounts offered under the discount medical plan.
(D) Except for hospital services, have restrictions on access to discount medical plan providers, including, but not limited to, waiting and notification periods.
(E) Pay providers fees for medical services or collect or accept money from a member to pay a provider for medical services received under the discount medical plan.
Effective Date: 03-23-2007 .
(A) A discount medical plan organization shall permit members to cancel membership in a discount medical plan at any time.
(B) If a member gives notice of cancellation within thirty days after the date the member receives the written document described in division (C) of section 3961.04 of the Revised Code for the discount medical plan, the discount medical plan organization, within thirty days of the member giving notice of cancellation, shall fully refund any fees except for a nominal fee associated with enrollment costs that shall not exceed thirty dollars.
(C) A discount medical plan organization shall not charge or collect a periodic fee after the member has returned to the organization the member's discount medical plan card or given the organization notice of cancellation.
(D) Cancellation of membership in a discount medical plan occurs when the member gives notice of cancellation to the discount medical plan organization or marketer by delivering the notice by hand, depositing the notice in a mailbox if the notice is properly addressed to the discount medical plan organization or marketer and postage is prepaid, or sending an electronic message to the discount medical plan organization's or marketer's electronic message address.
(E) A discount medical plan organization shall make a pro rata reimbursement of all periodic fees charged to a member, less nominal fees associated with enrollment, if a discount medical plan organization cancels a member's membership for any reason other than the member's failure to pay fees.
Effective Date: 03-23-2007 .
(A) The superintendent of insurance may examine or investigate the business and affairs of a discount medical plan organization as the superintendent deems appropriate to protect the interests of the residents of this state.
(B) When examining or investigating a discount medical plan organization pursuant to division (A) of this section, the superintendent may do both of the following:
(1) Order a discount medical plan organization to produce any records, files, advertising and solicitation materials, lists of providers with which the organization contracted, lists of members, provider agreements described in section 3961.02 of the Revised Code, agreements between a marketer and discount medical plan organization described in section 3961.03 of the Revised Code, or other information;
(2) Take statements under oath to determine whether a discount medical plan organization has violated or is violating sections 3961.01 to 3961.08 of the Revised Code or is acting contrary to the public interest.
(1) All records and other information concerning a discount medical plan organization obtained by the superintendent or the superintendent's deputies, examiners, assistants, agents, or other employees pursuant to division (B) of this section are confidential and not public records as defined in section 149.43 of the Revised Code unless the organization is given notice and opportunity for hearing pursuant to Chapter 119. of the Revised Code concerning the records and other information obtained under division (B) of this section. If no administrative action is initiated with respect to a particular matter about which the superintendent obtained records or other information under division (B) of this section, the records and other information shall remain confidential for three years after the file on the matter is closed. Release of the records and other information after the three-year period shall be governed by section 149.43 of the Revised Code.
(2) The records and other information described in division (C)(1) of this section shall remain confidential for all purposes except where the superintendent or the superintendent's deputies, examiners, assistants, agents, or other employees appropriately take official action regarding the affairs of the discount medical plan organization or marketer or in connection with actual or potential criminal proceeding.
(D) Notwithstanding division (C) of this section, the superintendent may do any of the following:
(1) Share records and other information obtained pursuant to division (B) of this section with other persons employed by or acting on behalf of the superintendent; local, state, federal, and international regulatory and law enforcement agencies; local, state, and federal prosecutors; and the national association of insurance commissioners and its affiliates and subsidiaries if the recipient agrees and has authority to agree to maintain the confidential status of the records or other information;
(2) Disclose records and other information obtained pursuant to division (B) of this section in furtherance of any regulatory or legal action brought by or on behalf of the superintendent or this state resulting from the exercise of the superintendent's official duties.
(E) Notwithstanding divisions (C) and (D) of this section, the superintendent may authorize the national association of insurance commissioners and its affiliates and subsidiaries by agreement to share confidential records and other information obtained pursuant to division (B) of this section with local, state, federal, and international regulatory and law enforcement agencies and local, state, and federal prosecutors if the recipient agrees and has authority to agree to maintain the confidential status of the records and other information.
(F) Any applicable privilege or claim of confidentiality is not waived as a result of sharing or disclosing information pursuant to division (D)(1) or (E) of this section.
(G) Employees or agents of the department of insurance shall not be required by any court in this state to testify in a civil action if the testimony concerns any matter related to records or other information considered confidential under this section.
(H) Nothing in this section shall be construed to limit the superintendent's powers under section 3901.04 of the Revised Code.
Effective Date: 03-23-2007 .
(A) No person shall fail to comply with sections 3961.01 to 3961.09 of the Revised Code. If the superintendent of insurance determines that any person has violated sections 3961.01 to 3961.07 of the Revised Code, the superintendent may take one or more of the following actions:
(1) Assess a civil penalty in an amount not to exceed twenty-five thousand dollars per violation if the person knew or should have known of the violation;
(2) Assess administrative costs to cover the expenses incurred in the administrative action, including, but not limited to, expenses incurred in the investigation and hearing process. Costs collected under this division shall be paid into the state treasury to the credit of the department of insurance operating fund created in section 3901.021 of the Revised Code.
(3) Order corrective actions in lieu of or in addition to the other penalties described in this section, including, but not limited to, suspending civil penalties if a discount medical plan organization complies with the terms of the corrective action order;
(4) Order restitution to members.
(B) Before imposing a penalty under division (A) of this section, the superintendent shall give a discount medical plan organization notice and opportunity for hearing as described in Chapter 119. of the Revised Code to the extent that Chapter 119. of the Revised Code does not conflict with any of the following service requirements:
(a) A notice of opportunity for hearing, a hearing officer's findings and recommendations, or any order issued by the superintendent under division (A) of this section shall be served by certified mail, return receipt requested, to the last known address of a discount medical plan organization. For purposes of division (B) of this section, an organization's last known address is the address listed on the organization's disclosures required under section 3961.04 of the Revised Code.
(b) If the certified mail envelope described in division (B)(1)(a) of this section is returned to the superintendent with an endorsement showing that service was refused or that the envelope was unclaimed, the notices, findings and recommendations, and orders described in division (B)(1)(a) of this section and all subsequent notices required under Chapter 119. of the Revised Code may be served by ordinary mail to the discount medical plan organization's last known address. The time period to request an administrative hearing described in Chapter 119. of the Revised Code shall begin to run from the date the ordinary mailing was sent. A certificate of mailing shall evidence any mailings sent by ordinary mail pursuant to this division and shall complete service to the organization unless the ordinary mail envelope is returned to the superintendent with an endorsement showing failure of delivery.
(c) If service by ordinary mail as described in division (B)(1)(b) of this section fails, the superintendent may publish a summary of the substantive provisions of the notice, findings and recommendations, or orders described in division (B)(1)(a) of this section once a week for three consecutive weeks in a newspaper of general circulation in the county of the discount medical plan organization's last known address. The notice shall be considered served on the date of the third publication.
(d) Any notice required to be served under Chapter 119. of the Revised Code also shall be served upon the party's attorney by ordinary mail if the party's attorney has entered an appearance in the matter.
(e) In lieu of certified or ordinary mail or publication notice as described in divisions (B)(1)(a), (b), and (c) of this section, the superintendent may perfect service on a party by personal delivery of the notice by the superintendent's designee.
(f) Notices regarding the scheduling of hearings and all other notices not described in division (B)(1)(a) of this section shall be sent by ordinary mail to the party and the party's attorney.
(2) A subpoena or subpoena duces tecum from the superintendent or the superintendent's designee or attorney to a witness for appearance at a hearing, for the production of documents or other evidence, or for taking testimony for use at a hearing shall be served by certified mail, return receipt requested. The subpoenas described in this division shall be enforced in the manner described in section 119.09 of the Revised Code. Nothing in this division shall be construed to limit the superintendent's other statutory powers to issue subpoenas.
(1) If a violation of sections 3961.01 to 3961.07 of the Revised Code has caused, is causing, or is about to cause substantial and material harm, the superintendent may issue a cease-and-desist order requiring a person to cease and desist from engaging in a violation.
(2) The superintendent shall, immediately after issuing an order pursuant to division (C)(1) of this section, serve notice of the order by certified mail, return receipt requested, or by any other manner described in division (B) of this section to the person subject to the order and all other persons involved in the violation. The notice shall specify the particular act, omission, practice, or transaction that is the subject of the order and set a date, not more than fifteen days after the date the order was issued, for a hearing on the continuation or revocation of the order. The person subject to the order shall comply with the order immediately upon receiving the order. After an order is issued pursuant to division (C)(1) of this section, the superintendent may publicize and notify all interested parties that a cease-and-desist order was issued.
(3) Upon application by the person subject to the order and for good cause, the superintendent may continue the hearing date described in division (C)(2) of this section. Chapter 119. of the Revised Code applies to the hearing on the order to the extent that the chapter does not conflict with the procedures described in this section. The superintendent shall, within fifteen days after objections are submitted concerning the hearing officer's report and recommendations, issue a final order either confirming or revoking the cease-and-desist order described in division (C)(1) of this section. The final order may be appealed as described in section 119.12 of the Revised Code.
(4) The remedy described in division (C) of this section is cumulative and concurrent with other remedies available under this section.
(D) If the superintendent has reasonable cause to believe that an order issued pursuant to this section has been violated in whole or in part, the superintendent may request the attorney general to commence any appropriate action against the violator. In an action described in this division, a court may impose any of the following penalties:
(1) A civil penalty of not more than twenty-five thousand dollars per violation;
(2) Injunctive relief;
(3) Restitution;
(4) Any other appropriate relief.
(E) The superintendent shall deposit any penalties assessed under division (A)(1) or (D) of this section into the state treasury to the credit of the department of insurance operating fund created in section 3901.021 of the Revised Code.
Effective Date: 03-23-2007 .
The superintendent of insurance may adopt rules in accordance with Chapter 119. of the Revised Code for purposes of implementing sections 3961.01 to 3961.08 of the Revised Code.
Effective Date: 03-23-2007 .