26:2J-19. Suspension or revocation of certificate of authority

a. The commissioner may suspend or revoke any certificate of authority issued to a health maintenance organization under this act if he finds that any of the following conditions exist:

(1) The health maintenance organization is operating in a manner significantly contrary to that described in section 3, hereof, unless amendments to such submissions have been filed with the commissioner;

(2) The health maintenance organization issues evidence of coverage which does not comply with the requirements of section 8 hereof;

(3) the health maintenance organization does not provide or arrange for basic health care services;

(4) the commissioner finds that:

(a) the health maintenance organization does not meet the requirements of section 4 a. (2), hereof; or

(b) the health maintenance organization is unable to fulfill its obligations to furnish health care services.

(5) the health maintenance organization is no longer financially responsible and may reasonably be expected to be unable to meet its obligations to enrollees or prospective enrollees;

(6) the health maintenance organization has failed to implement a mechanism affording the enrollees an opportunity to participate in matters of policy and operation under section 6, hereof;

(7) the health maintenance organization has failed to implement the complaint system required by section 12, hereof, in a manner to reasonably resolve valid complaints;

(8) the continued operation of the health maintenance organization would be hazardous to the health and safety of its enrollees;

(9) the health maintenance organization has otherwise failed to substantially comply with this act; or

(10) the health maintenance organization, or any person on its behalf, has advertised or merchandised its services in an untrue, misrepresentative, misleading, deceptive or unfair manner.

b. A certificate of authority shall be suspended or revoked only after compliance with the requirements of section 21, hereof.

c. When the certificate of authority of a health maintenance organization is suspended, the health maintenance organization shall not, during the period of such suspension, enroll any additional enrollees except newborn children or other newly acquired dependents of existing enrollees, and shall not engage in any advertising or solicitation whatsoever.

d. When the certificate of authority of a health maintenance organization is revoked, such organization shall proceed, immediately following the effective date of the order of revocation, to dissolve its structure, and shall conduct no further business except as may be essential to the orderly conclusion of the affairs of such organization. It shall engage in no further advertising or solicitation whatsoever. The commissioner or where applicable the Commissioner of Insurance may, by written order, permit such further operation of the organization as he may find to be in the best interest of enrollees, to the end that enrollees will be afforded the greatest practical opportunity to obtain continuing health care coverage.

L.1973, c. 337, s. 19, eff. Dec. 27, 1973.