§ 59A-46-3 — Establishment of health maintenance organizations

A. Notwithstanding any law of this state to the contrary, any person may apply to the superintendent for a certificate of authority to establish and operate a health maintenance organization in compliance with Chapter 59A, Article 46 NMSA 1978. No person shall establish or operate a health maintenance organization in this state without obtaining a certificate of authority under Chapter 59A, Article 46 NMSA 1978. A foreign corporation may qualify under Chapter 59A, Article 46 NMSA 1978, subject to its registration to do business in this state as a foreign corporation pursuant to Chapter 53, Article 17 NMSA 1978 and compliance with all provisions of Chapter 59A, Article 46 NMSA 1978 and other applicable state laws. B. Any health maintenance organization that has not previously received a certificate of authority to operate as a health maintenance organization as of January 1, 1994 shall submit an application for a certificate of authority under Subsection C of this section no later than March 1, 1993. Each such applicant may continue to operate until the superintendent acts upon the application. In the event that an application is denied under Section 59A-46-4 NMSA 1978, the applicant shall thereafter be treated as a health maintenance organization whose certificate of authority has been revoked. C. Each application for a certificate of authority shall be verified by an officer or authorized representative of the applicant, shall be in a form prescribed by the superintendent and shall set forth or be accompanied by the following: (1) a copy of the organizational documents of the applicant, such as the articles of incorporation, articles of association, partnership agreement, trust agreement or other applicable documents and all amendments thereto; (2) a copy of the bylaws, rules and regulations or similar document, if any, regulating the conduct of the internal affairs of the applicant; (3) a list of the names, addresses and official positions and biographical information on forms acceptable to the superintendent of the persons who are to be responsible for the conduct of the affairs and day to day operations of the applicant, including all members of the board of directors, board of trustees, executive committee or other governing board or committee and the principal officers in the case of a corporation or the partners or members in the case of a partnership or association; (4) a copy of any contract form made or to be made between any class of providers and the health maintenance organization and a copy of any contract made or to be made between third party administrators, marketing consultants or persons listed in Paragraph (3) of this subsection and the health maintenance organization; (5) a copy of the form of evidence of coverage to be issued to the enrollees; (6) a copy of the form of group contract, if any, to be issued to employers, unions, trustees or other organizations; (7) financial statements showing the applicant's assets, liabilities and sources of financial support, including both a copy of the applicant's most recent, regular certified financial statement and an unaudited current financial statement; (8) a financial feasibility plan that includes detailed enrollment projections, the methodology for determining premium rates to be charged during the first twelve months of operations certified by an actuary or other person determined by the superintendent to be qualified, a three-year projection of balance sheets, a three-year projection of cash flow statements showing any capital expenditures, purchase and sale of investments and deposits with the state and income and expense statements anticipated from the start of operations for three years or until the organization has had net income for at least one year, if longer, a description of the proposed method of marketing and a statement of the sources of working capital as well as any other sources of funding; (9) a power of attorney duly executed by the applicant, if not domiciled in this state, appointing the superintendent, his successors in office and duly authorized deputies as the true and lawful attorney of such applicant in and for this state upon whom all lawful process in any legal action or proceeding against the health maintenance organization on a cause of action arising in this state may be served; (10) a statement or map reasonably describing the geographic area or areas to be served; (11) a description of the internal grievance procedures to be utilized for the investigation and resolution of enrollee complaints and grievances; (12) a description of the proposed quality assurance program, including the formal organizational structure, methods for developing criteria, procedures for comprehensive evaluation of the quality of care rendered to enrollees and processes to initiate corrective action and reevaluation when deficiencies in provider or organizational performance are identified; (13) a description of the procedures to be implemented to meet the protection against insolvency requirements in Section 59A-46-13 NMSA 1978; (14) a list of the names, addresses and license numbers of all providers with which the health maintenance organization has agreements; and (15) such other information as the superintendent may require to make the determinations required in Section 59A-46-4 NMSA 1978. D. A health maintenance organization shall, unless otherwise provided for in Chapter 59A, Article 46 NMSA 1978, file a notice describing any substantial modification of the operation set out in the information required by Subsection C of this section. Such notice shall be filed with the superintendent prior to the modification. If the superintendent does not disapprove within thirty days of filing, such modification shall be deemed approved.

Legislative History

1978 Comp., § 59A-46-3, enacted by Laws 1993, ch. 266, § 3.