41-3919. OPEN ENROLLMENT. (1) Requirement of an open enrollment period is intended to provide the benefits of managed care to the general public or to all members of the class of persons the managed care organization serves. Such requirement is not intended to prohibit a managed care organization from establishing administrative procedures that protect the quality of service to its members or the financial condition of the organization. However, during periods of open enrollment the organization shall not establish any administrative procedure that arbitrarily and unreasonably restricts enrollment.

(2) After the initial twenty-four (24) months of operation every managed care organization shall have an annual open enrollment period of at least one (1) month during which it accepts members, without restrictions up to the limits of its capacity except as provided in subsection (3) of this section, as determined by the managed care organization, in the order in which they apply for enrollment. Managed care organizations organized to provide services exclusively to a specified group or groups of individuals may limit such open enrollment to all members of such group(s).

(3) A managed care organization may apply to the director for authorization to impose underwriting restrictions upon enrollment. The director shall, within thirty (30) days, approve the application if he determines that such restrictions will:

(a) Preserve the financial stability of the managed care organization; or

(b) Prevent excessive adverse selection of prospective members; or

(c) Avoid unreasonably high or unmarketable charges for member coverage for health care services.

If the application cannot be approved the director must deny it within the thirty (30) day period.

History:

[41-3919, added 1974, ch. 177, sec. 19, p. 1444; am. 1997, ch. 204, sec. 21, p. 594.]