(a) Within 120 days after the filing of the documents required by subdivision (b) of Section 1780.54, the commissioner shall notify the organization in writing of the commissioner’s determination to approve or disapprove the organization’s qualifications and its plan of operation and which, if any, of the duties identified in the plan of operation the commissioner has determined to delegate to the organization. The commissioner and the organization shall confer to resolve any and all issues that the commissioner may raise concerning the organization’s qualifications, its plan of operation, or which duties should be delegated to the organization. Any determination by the commissioner to disapprove the organization’s qualifications or plan of operation or not to delegate one or more of the duties identified in the plan of operation shall be accompanied by a statement of the commissioner’s reasons therefor.

(b) The commissioner may provisionally approve the organization’s qualifications and plan of operation and may provisionally delegate one or more of the duties identified in the plan of operation pending the commissioner’s determinations under subdivision (a).

(c) Upon approval of the organization’s qualifications and plan of operation and upon delegation to the organization of one or more of the duties identified in the plan of operation, the organization shall commence operations as the advisory organization under this chapter, consistent with the duties delegated by the commissioner. In the event of provisional approval and delegation pursuant to subdivision (b), the organization shall operate as the advisory organization under this chapter during the period of, and consistent with, the provisional approval and delegation by the commissioner.

(d) Any amendment to the advisory organization’s plan of operation that is required by subdivision (d) of Section 1780.54 shall be approved or disapproved pursuant to the procedures set forth in this section.

(e) The time periods set forth in this section may be extended by consent of the organization and the commissioner.

(f) The decision whether to delegate or withdraw one or more of the duties identified in the plan of operation is committed to the commissioner’s sound discretion. The commissioner may, upon not less than one year’s notice to the advisory organization, withdraw one or more functions that have been delegated to the advisory organization in order that any one or more functions so withdrawn may be performed by the Department of Insurance.

(Added by Stats. 1993, Ch. 1007, Sec. 1. Effective January 1, 1994.)