17:48A-6. Written contracts required; subscription certificates

Every individual contract entered into by any such corporation with any subscriber shall be in writing and a certificate stating the terms and conditions thereof shall be furnished to the subscriber. No such subscription certificate shall be issued or delivered by any medical service corporation of this State unless it contains the following provisions:

(a) A statement of the amounts payable to the corporation by the subscriber and the times at which and the manner in which such amounts shall be paid; and a provision requiring 1 month's written notice to the subscriber before termination or cancellation of the contract or any change in the contract, including a change of subscription rate, shall take effect;

(b) A statement of the nature of the medical services to be paid for and the period during which the certificate is effective; and if there are any types of medical services to be excepted, or for which benefits are limited, a detailed statement of such exceptions and limitations printed as hereinafter specified;

(c) A statement of the terms or conditions, if any, upon which the certificate may be canceled or otherwise terminated at the option of either party. Any notice to the subscriber shall be effective if sent by mail to the subscriber's address as shown at the time on the plan's records, except that, in the case of persons for whom payment is made through a remitting agent, any such notice to the subscriber shall also be effective if a personalized notice is sent to the remitting agent for delivery to the subscriber, in which case it shall be the responsibility of the remitting agent to make such delivery. The notice to the subscriber as herein required shall be sent at least 30 days before the amendment, cancellation or termination of the contract takes effect. Any rider or endorsement accompanying such notice, and amending the rates or other provisions of the contract, shall be deemed to be a part of the contract as of the effective date of such rider or endorsement;

(d) A statement that the subscription certificate constitutes the contract between the corporation and the subscriber and includes the endorsements thereon and attached papers, if any, and contains the entire contract;

(e) A statement that no statement by the subscriber in his application for a certificate shall avoid the contract or be used in any legal proceeding thereunder, unless such application or an exact copy thereof is included in or attached to the certificate, and that no agent or representative of such corporation, other than an officer or officers designated in the certificate, is authorized to change the contract or waive any of its provisions;

(f) A statement that if the subscriber defaults in making any payment under the certificate, the subsequent acceptance of a payment by the corporation or by one of its duly authorized agents shall reinstate the certificate, but with respect to sickness and injury may cover only such sickness and injury as may be first manifested more than a specified number of days, not exceeding 10, after the date of such acceptance;

(g) A statement of the period of grace which will be allowed the subscriber for making any payment due under the contract. Such period shall not be less than 10 days;

(h) A statement that indemnity in the form of cash will not be paid to any subscriber except in payment for medical services for which the corporation was liable at the time of such payment.

Any such subscription certificate may contain a provision that all medical services paid for by a medical service corporation shall be in accordance with the accepted medical practices in the community at the time, but the corporation shall not be liable for injuries resulting from negligence, misfeasance, malfeasance, nonfeasance or malpractice on the part of any officer or employee or on the part of any physician in the course of rendering medical services to subscribers.

Any medical service corporation may classify subscribers whereby under specified circumstances a subscriber or covered dependents may pay a participating physician for medical services an amount in addition to that payable by the corporation for medical services and the subscription certificate issued to any subscriber affected thereby shall contain the provisions thereof and shall specify such circumstances.

L.1940, c. 74, p. 188, s. 6. Amended by L.1944, c. 102, p. 261, s. 4; L.1970, c. 113, s. 2, eff. June 26, 1970.