(1) Each cooperative organized pursuant to this part 10 shall:

(a) Establish the conditions of cooperative membership;

(b) Provide to cooperative members and their eligible employees clear, standardized information about each provider network, licensed provider network, carrier, or other provider contracted with by the cooperative, including, but not limited to, information on price, benefits, costs, quality, patient satisfaction, membership, and responsibilities and obligations;

(c) Offer dependent coverage;

(d) Except for groups over fifty, offer to all members and their eligible employees the standard and basic health benefit plans;

(e) Obtain the necessary contact information and resources to provide to members and their eligible employees the information described in paragraph (b) of this subsection (1);

(f) Contract only for insurance functions listed in section 10-3-903, with entities authorized to do business in this state by the commissioner pursuant to this title that have:

(I) The capacity to administer the health benefit plan or services to be offered;

(II) The ability to monitor and evaluate the quality and cost-effectiveness of care and applicable procedures;

(III) The ability to report quality and outcomes information necessary for the cooperative to report quality information to members and their eligible employees; and

(IV) The ability to assure members and their eligible employees adequate access to health care providers, including an adequate number and type of providers for the risk pool involved;

(g) Develop and implement a marketing plan that will widely publicize the cooperative to potential members and their eligible employees and develop and implement methods for informing the public about the cooperative and its services;

(h) State clearly all administrative and broker or agent fees associated with membership in all materials published for the purpose of soliciting members and their eligible employees or that may be used by potential members in deciding whether to join the cooperative;

(i) Establish administrative and accounting procedures for the operation of the cooperative and members' services, prepare an annual cooperative budget, and prepare annual program and fiscal reports on cooperative operations;

(j) Maintain all records, reports, and other information of the cooperative;

(k) Maintain a trust account or accounts for the deposit of premium moneys collected pursuant to paragraph (d) of subsection (3) of this section, to be paid to carriers or licensed provider networks or licensed individual providers for coverage offered through the cooperative. A cooperative shall have a fiduciary duty with respect to premium moneys collected for carriers and licensed provider networks offered through the cooperative.

(l) Annually report on operations of the cooperative, including program and financial operations, and provide for internal and independent audits;

(m) Disclose to members and potential members whether or not the cooperative has been granted a temporary certificate of authority pursuant to section 10-16-1005 (1)(b);

(n) Offer the same premiums and any negotiated health care prices to all member classes, if any, equally; except that a cooperative may offer different premiums or negotiated health care prices to members who are not small employers.

(2) Members that are not self-insured may only be offered plans or services offered by licensed provider networks, licensed individual providers, and other carriers. For purposes of this part 10, "self-insured" means not insured under a plan underwritten by a carrier or licensed provider network. A self-insured employer or individual may join a cooperative in order to have access to the discounted provider rates (excluding capitated agreements) that the cooperative may negotiate on behalf of its self-insured members.

(3) Each cooperative organized pursuant to this part 10 may:

(a) Determine, from time to time, the need to establish classes of membership;

(b) Set reasonable fees for membership in the cooperative that will finance all reasonable and necessary costs incurred in administering the cooperative;

(c) Offer any and all health benefit packages permitted under law in addition to the standard and basic health benefit plans;

(d) Require, as a condition of membership, that all employers include all their employees or a minimum percentage of employees in coverage purchased through the cooperative. The cooperative may establish minimum percentages that differ according to the benefit plan or carrier offered. The cooperative may require an employer making membership application to a cooperative that would entail entering fewer than one hundred percent of such employer's eligible employees or dependents to demonstrate, under standards consistent with paragraph (g) of subsection (4) of this section, that such membership is not likely to result in an adverse selection group being brought into the cooperative and would not otherwise act as a form of risk selection or risk avoidance.

(e) Subject to paragraph (l) of subsection (1) of this section, provide premium collection services for plans and licensed provider networks or licensed individual providers offered through the cooperative;

(f) Reject, or allow a carrier to reject, an employer from membership or drop, or allow a carrier to drop, an employer from membership if the employer or any of its employee members fails to pay premiums or engages in fraud or material misrepresentation in connection with a plan purchased through the cooperative. If an employer or employee is dropped from membership, the employee shall be entitled to continuation and conversion coverage as provided under applicable state or federal continuation laws and the state conversion law.

(g) Contract with qualified independent third parties for any service necessary to carry out the powers and duties authorized or required by this part 10;

(h) Contract with licensed insurance agents or brokers to market coverage made available through the cooperative to its members. A cooperative shall use a uniform fee schedule for all agents and brokers. Such fee schedule shall not vary based on the actual or expected health status or medical utilization of the group to which coverage is sold.

(i) Exclude any carrier, provider network, or provider or freeze enrollment in any carrier, provider network, or provider for failure to achieve established quality, access, or information reporting standards of the cooperative;

(j) Prohibit members who drop coverage through the cooperative from reenrolling for up to twelve months in coverage purchased through the cooperative;

(k) Require that members and their eligible employees continue to pay administrative fees that are part of the contract with the cooperative if a member or eligible employee cancels prior to completion of a contract period;

(l) Offer coverage for individuals who are members. If coverage is offered to individuals as members, the cooperative may require that individuals include all dependents under such coverage.

(m) Establish employer contribution requirements. Such requirements may differ by benefit plan, benefit package, or carrier.

(4) No cooperative organized pursuant to this part 10 may:

(a) Exclude from membership in the cooperative any small employer or eligible employee or dependent of a small employer who agrees to pay fees for membership and any premium for coverage through the cooperative and who abides by the bylaws and rules of the cooperative and satisfies the requirements of the benefit plan selected;

(b) Differentiate classes of membership on the basis of industry type, race, religion, gender, education, health status, or income;

(c) Commit any act constituting a rebate prohibited by section 10-3-1104 (1)(g). The commissioner shall enforce this paragraph (c) pursuant to part 11 of article 3 of this title.

(d) Prohibit any hospital, health maintenance organization, or other provider, as a condition of contracting to provide services through the cooperative, from providing services through a subcontract or subcontracts with any other hospital, health maintenance organization, or other provider meeting the cooperative's quality standards;

(e) Charge any fee not directly related to health care or the administration of health care purchasing functions;

(f) As a condition of membership, require any member, eligible employee, or dependent to subscribe to non-health-care-related products or services;

(g) Knowingly operate the cooperative or market the cooperative in a county or primary metropolitan statistical area in a way that would cause the cooperative to select a risk pool with actuarially projected health care utilization over a two-year period that is below the projected average for all individuals residing in that county or primary metropolitan statistical area. Such measurement and comparison of projected utilization by members of the cooperative to all individuals shall be done on a county or primary metropolitan statistical area basis and not across all members of the cooperative.

(h) Knowingly authorize or select any carrier, provider, licensed provider network, licensed individual provider, or individual provider that does not comply with or conform to the applicable requirements or standards of this title.