NRS: CHAPTER 695F - PREPAID LIMITED HEALTH SERVICE ORGANIZATIONS

[Rev. 6/29/2024 5:02:52 PM--2023]

CHAPTER 695F - PREPAID LIMITED HEALTH SERVICE ORGANIZATIONS

GENERAL PROVISIONS

NRS 695F.010 Definitions.

NRS 695F.020 “Enrollee” defined.

NRS 695F.030 “Evidence of coverage” defined.

NRS 695F.040 “Limited health service” defined.

NRS 695F.043 “Medicaid” defined.

NRS 695F.047 “Order for medical coverage” defined.

NRS 695F.050 “Prepaid limited health service organization” defined.

NRS 695F.060 “Provider” defined.

NRS 695F.070 “Subscriber” defined.

NRS 695F.080 General applicability of title 57 of NRS.

NRS 695F.090 Applicability of chapter and other provisions.

CERTIFICATE OF AUTHORITY

NRS 695F.100 Certificate required.

NRS 695F.110 Application; fee.

NRS 695F.120 Review of application; issuance of certificate.

NRS 695F.130 Application of person who is licensed as insurer or holds another certificate of authority.

NRS 695F.140 Denial of application; hearing.

OPERATION

NRS 695F.150 Evidence of coverage: Issuance; contents; amendment.

NRS 695F.151 Organization required to offer and issue plan regardless of health status of persons; prohibited acts; authority to include wellness program in plan that offers discounts based on health status under certain circumstances.

NRS 695F.153 Evidence of coverage covering prescription drugs: Provision of notice and information regarding use of formulary.

NRS 695F.156 Evidence of coverage covering prescription drugs prohibited from limiting or excluding coverage for certain prescription drugs previously approved for medical condition of enrollee; exceptions.

NRS 695F.158 Evidence of coverage covering prescription drugs: Required actions by organization related to acquisition of prescription drugs for certain insureds residing in area for which emergency or disaster has been declared.

NRS 695F.159 Evidence of coverage covering prescription drugs: Use of step therapy protocol for drug to treat psychiatric condition prohibited in certain circumstances.

NRS 695F.160 Rates and charges: Reasonableness.

NRS 695F.170 Procedure for modification of rates, charges, benefits, organization, operations, documents or services.

NRS 695F.190 Requirements for reserve.

NRS 695F.200 Maintenance of capital account, surety bond or deposit and risk-based capital; determination of amount of increase by Commissioner.

NRS 695F.210 Maintenance of fidelity bond or deposit in lieu of bond.

NRS 695F.212 Hazardous financial condition: Regulations; determination; powers of Commissioner.

NRS 695F.220 Contract between organization and provider or subcontractor for provision of services to enrollees: Required terms and conditions.

NRS 695F.230 Establishment of system for resolution of complaints.

REGULATION AND ENFORCEMENT

NRS 695F.300 Regulations.

NRS 695F.310 Examinations and investigations.

NRS 695F.320 Annual report and financial statement; quarterly statement; additional reports; penalties for failure to file report or statement.

NRS 695F.330 Payment of premium tax.

NRS 695F.340 Fees.

NRS 695F.350 Suspension or revocation of certificate of authority: Grounds; notice; hearing; effect.

NRS 695F.360 Violations of chapter: Order to cease and desist; fine.

MISCELLANEOUS PROVISIONS

NRS 695F.400 License required to apply, procure, negotiate or place for another any policy or contract of organization.

NRS 695F.410 Confidentiality and disclosure of information.

NRS 695F.420 Certain insurers and organizations authorized to exclude coverage duplicated pursuant to this chapter.

NRS 695F.430 Provision of services excluded from practice of any healing arts; solicitation excluded from provisions regarding solicitation or advertising by practitioner of healing art.

ELIGIBILITY FOR COVERAGE

NRS 695F.440 Effect of eligibility for medical assistance under Medicaid; assignment of rights to state agency.

NRS 695F.450 Organization prohibited from asserting certain grounds to deny enrollment of child pursuant to order if parent is insured.

NRS 695F.460 Certain accommodations required to be made when child is covered under evidence of coverage of noncustodial parent.

NRS 695F.470 Organization required to authorize enrollment of child of parent who is required by order to provide medical coverage under certain circumstances; termination of coverage of child.

_________

GENERAL PROVISIONS

NRS 695F.010 Definitions. As used in this chapter, unless the context otherwise requires, the words and terms defined in NRS 695F.020 to 695F.070, inclusive, have the meanings ascribed to them in those sections.

(Added to NRS by 1991, 1113; A 1995, 2439)

NRS 695F.020 “Enrollee” defined. “Enrollee” means a person, including the dependents of the person, who is entitled to a limited health service pursuant to a contract with a person authorized to provide or arrange for that service pursuant to this chapter.

(Added to NRS by 1991, 1113)

NRS 695F.030 “Evidence of coverage” defined. “Evidence of coverage” means any certificate, agreement or contract issued to an enrollee which sets forth the coverage the enrollee is entitled to receive.

(Added to NRS by 1991, 1113)

NRS 695F.040 “Limited health service” defined. “Limited health service” means:

1. Chiropractic, naprapathic, dental, hospital, medical, optometric, pharmaceutical, podiatric or surgical care;

2. Treatment relating to mental health or an alcohol or substance use disorder; or

3. Such other care or treatment as may be determined by the Commissioner to be a limited health service.

(Added to NRS by 1991, 1113; A 1993, 2402; 2023, 1711)

NRS 695F.043 “Medicaid” defined. “Medicaid” means a program established in any state pursuant to Title XIX of the Social Security Act (42 U.S.C. §§ 1396 et seq.) to provide assistance for part or all of the cost of medical care rendered on behalf of indigent persons.

(Added to NRS by 1995, 2437)

NRS 695F.047 “Order for medical coverage” defined. “Order for medical coverage” means an order of a court or administrative tribunal to provide medical coverage to a child pursuant to the provisions of 42 U.S.C. § 1396g-1.

(Added to NRS by 1995, 2437)

NRS 695F.050 “Prepaid limited health service organization” defined.

1. “Prepaid limited health service organization” means any person who, in return for a prepayment, agrees to provide or arrange for the provision of one or more limited health services to enrollees.

2. The term does not include:

(a) A person otherwise authorized pursuant to the laws of this state to provide a limited health service on a prepayment basis or any other basis or to indemnify for any limited health service;

(b) A person who complies with the requirements of NRS 695F.130; or

(c) A provider who provides or arranges for the provision of a limited health service pursuant to a contract with a prepaid limited health service organization or person described in paragraph (a) or (b).

(Added to NRS by 1991, 1113)

NRS 695F.060 “Provider” defined. “Provider” means any physician, dentist or any other person who is licensed or otherwise authorized in this state to provide a limited health service.

(Added to NRS by 1991, 1114)

NRS 695F.070 “Subscriber” defined. “Subscriber” means a person whose employment or other status, except for family dependency, is the basis for his or her entitlement to receive a limited health service pursuant to a contract with a person authorized to provide or arrange for that service pursuant to this chapter.

(Added to NRS by 1991, 1114)

NRS 695F.080 General applicability of title 57 of NRS. Except as otherwise provided in this chapter or in specific provisions of this title, the provisions of this title are not applicable to any prepaid limited health service organization granted a certificate of authority pursuant to this chapter. This section does not apply to an insurer licensed and regulated pursuant to this title except with respect to its activities as a prepaid limited health service organization authorized and regulated pursuant to this chapter.

(Added to NRS by 1991, 1114)

NRS 695F.090 Applicability of chapter and other provisions.

1. Prepaid limited health service organizations are subject to the provisions of this chapter and to the following provisions, to the extent reasonably applicable:

(a) NRS 686B.010 to 686B.175, inclusive, concerning rates and essential insurance.

(b) NRS 687B.310 to 687B.420, inclusive, concerning cancellation and nonrenewal of policies.

(d) The requirements of NRS 679B.152.

(e) The fees imposed pursuant to NRS 449.465.

(f) NRS 686A.010 to 686A.310, inclusive, concerning trade practices and frauds.

(g) The assessment imposed pursuant to NRS 679B.700.

(h) Chapter 683A of NRS.

(i) To the extent applicable, the provisions of NRS 689B.340 to 689B.580, inclusive, and chapter 689C of NRS relating to the portability and availability of health insurance.

(j) NRS 689A.035, 689A.0463, 689A.410, 689A.413 and 689A.415.

(k) NRS 680B.025 to 680B.060, inclusive, concerning premium tax, premium tax rate, annual report and estimated quarterly tax payments. For the purposes of this paragraph, unless the context otherwise requires that a section apply only to insurers, any reference in those sections to “insurer” must be replaced by a reference to “prepaid limited health service organization.”

(l) Chapter 692C of NRS, concerning holding companies.

(m) NRS 689A.637, concerning health centers.

(n) Chapter 681B of NRS, concerning assets and liabilities.

(o) NRS 682A.400 to 682A.468, inclusive, concerning investments.

2. For the purposes of this section and the provisions set forth in subsection 1, a prepaid limited health service organization is included in the meaning of the term “insurer.”

(Added to NRS by 1991, 1121; A 1993, 2402; 1997, 1097, 2960, 2962, 3036; 1999, 631, 1652; 2001, 480, 1924; 2005, 2346; 2013, 3458, 3650; 2015, 646; 2017, 2399; 2021, 902, 2996; 2023, 23)

CERTIFICATE OF AUTHORITY

NRS 695F.100 Certificate required. A person shall not operate a prepaid limited health service organization in this state unless the person has been issued a certificate of authority by the Commissioner pursuant to this chapter.

(Added to NRS by 1991, 1114)

NRS 695F.110 Application; fee. An application for a certificate of authority to operate a prepaid limited health service organization must be filed with the Commissioner on a form prescribed by the Commissioner. The application must be verified by an officer or authorized representative of the applicant and include:

1. A copy of the applicant’s basic organizational document, including any articles of incorporation, articles of association, partnership agreement, trust agreement or any other applicable document or amendment thereto.

2. A copy of the bylaws, rules and regulations or similar documents, if any, which regulate the conduct of the internal affairs of the applicant.

3. A list of the names, addresses, official positions and biographical information of the persons responsible for conducting the applicant’s affairs, including, but not limited to:

(a) The members of the board of directors;

(b) The members of the board of trustees;

(d) The principal officers;

(e) Any person owning or having the right to acquire 10 percent or more of the voting securities of the applicant; and

(f) If the applicant is a partnership or association, the partners or members of that partnership or association.

4. A statement generally describing the applicant, its facilities, employees and the limited health service or services to be offered.

5. A copy of any contract made or to be made between the applicant and any provider concerning the provision of a limited health service to enrollees.

6. A copy of any contract made, or to be made between the applicant and any person described in subsection 3.

7. A copy of any contract made or to be made between the applicant and any person for the performance on the applicant’s behalf of any functions, including, but not limited to, marketing, administration, enrollment, management of investments and subcontracting for the provision of a limited health service to enrollees.

8. A copy of the form of any group contract which is to be issued to employers, unions, trustees or other organizations.

9. A copy of any form for evidence of coverage to be issued to subscribers.

10. A copy of the applicant’s most recent financial statements which have been audited by an independent certified public accountant. If the financial affairs of the parent company of the applicant are audited by an independent certified public accountant and the financial affairs of the applicant are not audited, the applicant must submit a copy of the most recently audited financial statement of the parent company which was certified by an independent certified public accountant and the consolidating financial statements of the applicant, unless the Commissioner determines that additional or more recent financial information is required.

11. A copy of the applicant’s financial plan, including a 3-year projection of the anticipated operating results, a statement of the sources of working capital and any other sources of funding and any plan for contingencies.

12. A schedule of the rates and charges for the limited health service.

13. A description of the proposed method of marketing.

14. A statement acknowledging that any process in any legal action or proceeding against the applicant on a cause of action arising in this state is valid if lawfully served.

15. A description of the procedure for the resolution of complaints submitted by enrollees concerning the limited health service provided by the prepaid limited health service organization.

16. A description of the procedures to be established for quality assessment and utilization review.

17. A description of the applicant’s plan to comply with the provisions of NRS 695F.200.

18. All applicable fees for filing an application for a certificate of authority.

19. Such other information as the Commissioner may require to make the determination required by this chapter.

(Added to NRS by 1991, 1114; A 2009, 1820)

NRS 695F.120 Review of application; issuance of certificate.

1. The Commissioner shall review each application and notify the applicant of any deficiency contained in the application.

2. The Commissioner shall issue a certificate of authority to an applicant if:

(a) The applicant has complied with the requirements set forth in NRS 695F.110;

(b) The persons responsible for conducting the applicant’s affairs are competent, trustworthy and possess good reputations, and have the appropriate experience, training or education;

(c) The applicant is financially responsible and may reasonably be expected to carry out its obligations to enrollees and prospective enrollees; and

(d) The agreements with providers for the limited health service include the provisions required by NRS 695F.220.

3. The Commissioner may, when determining whether an applicant complies with the requirements of paragraph (c) of subsection 2, consider:

(a) The financial soundness of the applicant’s arrangements for the provision of a limited health service and the schedule of rates, deductibles, copayments and other charges used in connection therewith;

(b) The adequacy of working capital, any other sources of funding and any provisions for contingencies;

(c) Any agreement for paying the cost of a limited health service or for alternative coverage if the prepaid limited health service organization becomes insolvent; and

(d) The applicant’s manner of compliance with the requirements of NRS 695F.200.

(Added to NRS by 1991, 1115)

NRS 695F.130 Application of person who is licensed as insurer or holds another certificate of authority. Any person who is licensed as an insurer pursuant to chapter 680A of NRS or issued a certificate of authority pursuant to chapter 695A, 695B or 695C of NRS may submit an application to the Commissioner for a certificate of authority to provide a limited health service in this state. The application must include the information requested by subsections 4, 5, 7, 8, 10, 11, 12 and 15 of NRS 695F.110 and any subsequent material changes or additions thereto.

(Added to NRS by 1991, 1116)

NRS 695F.140 Denial of application; hearing.

1. If the Commissioner denies an application for a certificate of authority of a person who files an application pursuant to NRS 695F.120 or 695F.130, the Commissioner shall send a written notice to the applicant. The notice must include the reason for the denial of the certificate.

2. The applicant may, within 30 days after it receives the notice, submit to the Commissioner a written request for a hearing on the matter. The Commissioner shall hold a hearing within 30 days after the Commissioner receives the request.

3. The hearing must be held in the manner set forth in NRS 679B.310 to 679B.370, inclusive. The decision of the Commissioner is a final decision for the purpose of judicial review.

(Added to NRS by 1991, 1116)

OPERATION

NRS 695F.150 Evidence of coverage: Issuance; contents; amendment.

1. A prepaid limited health service organization shall issue evidence of coverage to each subscriber. Each evidence of coverage must contain a clear and complete statement of:

(a) The limited health service which the enrollee is entitled to receive;

(b) Any limitation of that service, type of service or benefits to be provided, and exclusions, including any deductible, copayment or other charges;

(c) Where and in what manner information is available concerning the location of and manner in which the limited health service may be obtained; and

(d) The method established for the resolution of complaints submitted by enrollees concerning the provision of the limited health service.

2. A prepaid limited health service organization may provide to a subscriber any amendment to the evidence of coverage in a separate document.

(Added to NRS by 1991, 1116)

1. A prepaid limited health service organization shall offer and issue a health benefit plan to any person regardless of the health status of the person or any dependent of the person. Such health status includes, without limitation:

(a) Any preexisting medical condition of the person, including, without limitation, any physical or mental illness;

(b) The claims history of the person, including, without limitation, any prior health care services received by the person;

(d) Any increased risk for illness, injury or any other medical condition of the person, including, without limitation, any medical condition caused by an act of domestic violence.

2. A prepaid limited health service organization that offers or issues a health benefit plan shall not:

(a) Deny, limit or exclude a covered benefit based on the health status of an enrollee; or

(b) Require an enrollee, as a condition of enrollment or renewal, to pay a premium, deductible, copay or coinsurance based on his or her health status which is greater than the premium, deductible, copay or coinsurance charged to a similarly situated enrollee who does not have such a health status.

3. A prepaid limited health service organization that offers or issues a health benefit plan shall not adjust a premium, deductible, copay or coinsurance for any enrollee on the basis of genetic information relating to the enrollee or the covered dependent of the enrollee.

4. A prepaid limited health service organization that offers or issues a health benefit plan may include in the plan a wellness program that reduces a premium, deductible or copayment based on health status if:

(a) An enrollee who is eligible to participate in the wellness program is given the opportunity to qualify for the discount at least once each year;

(b) The amount of all discounts provided pursuant to such a wellness program does not exceed 30 percent, or if the program is designed to prevent or reduce tobacco use, 50 percent, of the cost of coverage for an enrollee or an enrollee and his or her dependents, as applicable, under the plan;

(d) The prepaid limited health service organization ensures that the full discount under the wellness program is available to all similarly situated enrollees by providing a reasonable alternative standard by which an enrollee may qualify for the discount which, if based on health status, must accommodate the recommendations of the physician of the enrollee; and

(e) The plan discloses in all plan materials describing the terms of the wellness program, and in any disclosure that an enrollee did not satisfy the initial standard to be eligible for the discount, the availability of a reasonable alternative standard described in paragraph (d).

5. As used in this section, “health benefit plan” has the meaning ascribed to it in NRS 687B.470.

(Added to NRS by 2019, 312)

NRS 695F.153 Evidence of coverage covering prescription drugs: Provision of notice and information regarding use of formulary.

1. A prepaid limited health service organization that offers or issues evidence of coverage which provides coverage for prescription drugs shall include with any evidence of that coverage provided to a subscriber, notice of whether a formulary is used and, if so, of the opportunity to secure information regarding the formulary from the organization pursuant to subsection 2. The notice required by this subsection must:

(a) Be in a language that is easily understood and in a format that is easy to understand;

(b) Include an explanation of what a formulary is; and

(1) An explanation of:

(I) How often the contents of the formulary are reviewed; and

(II) The procedure and criteria for determining which prescription drugs are included in and excluded from the formulary; and

(2) The telephone number of the organization for making a request for information regarding the formulary pursuant to subsection 2.

2. If a prepaid limited health service organization offers or issues evidence of coverage which provides coverage for prescription drugs and a formulary is used, the organization shall:

(a) Provide to any enrollee or participating provider of health care, upon request:

(1) Information regarding whether a specific drug is included in the formulary.

(2) Access to the most current list of prescription drugs in the formulary, organized by major therapeutic category, with an indication of whether any listed drugs are preferred over other listed drugs. If more than one formulary is maintained, the organization shall notify the requester that a choice of formulary lists is available.

(b) Notify each person who requests information regarding the formulary, that the inclusion of a drug in the formulary does not guarantee that a provider of health care will prescribe that drug for a particular medical condition.

(Added to NRS by 2001, 864)

1. Except as otherwise provided in this section, evidence of coverage which provides coverage for prescription drugs must not limit or exclude coverage for a drug if the drug:

(a) Had previously been approved for coverage by the prepaid limited health service organization for a medical condition of an enrollee and the enrollee’s provider of health care determines, after conducting a reasonable investigation, that none of the drugs which are otherwise currently approved for coverage are medically appropriate for the enrollee; and

(b) Is appropriately prescribed and considered safe and effective for treating the medical condition of the enrollee.

2. The provisions of subsection 1 do not:

(a) Apply to coverage for any drug that is prescribed for a use that is different from the use for which that drug has been approved for marketing by the Food and Drug Administration;

(b) Prohibit:

(1) The organization from charging a deductible, copayment or coinsurance for the provision of benefits for prescription drugs to the enrollee or from establishing, by contract, limitations on the maximum coverage for prescription drugs;

(2) A provider of health care from prescribing another drug covered by the evidence of coverage that is medically appropriate for the enrollee; or

(3) The substitution of another drug pursuant to NRS 639.23286 or 639.2583 to 639.2597, inclusive; or

3. Any provision of an evidence of coverage subject to the provisions of this chapter that is delivered, issued for delivery or renewed on or after October 1, 2001, which is in conflict with this section is void.

(Added to NRS by 2001, 865; A 2003, 2301; 2017, 640)

1. If the Governor or the Legislature proclaims the existence of a state of emergency or issues a declaration of disaster pursuant to NRS 414.070, a prepaid limited health service organization that has issued evidence of coverage which provides coverage for prescription drugs shall, notwithstanding any provision of the evidence of coverage to the contrary:

(a) Waive any provision of the evidence of coverage restricting the time within which an enrollee may refill a covered prescription if the enrollee:

(1) Has not exceeded the number of refills authorized by the prescribing practitioner;

(2) Resides in the area for which the emergency or disaster has been declared; and

(3) Requests the refill not later than the end of the state of emergency or disaster or 30 days after the issuance of the proclamation or declaration, whichever is later; and

(b) Authorize payment for, and may apply a copayment, coinsurance or deductible to, a supply of a covered prescription drug for up to 30 days for an enrollee who requests a refill pursuant to paragraph (a).

2. The Commissioner may extend the time periods prescribed by subsection 1 in increments of 15 or 30 days as he or she determines to be necessary.

3. As used in this section, “practitioner” has the meaning ascribed to it in NRS 639.0125.

(Added to NRS by 2021, 828)

NRS 695F.159 Evidence of coverage covering prescription drugs: Use of step therapy protocol for drug to treat psychiatric condition prohibited in certain circumstances.

1. Evidence of coverage which provides coverage for prescription drugs must not require an enrollee to use a step therapy protocol before covering a drug approved by the Food and Drug Administration that is prescribed to treat a psychiatric condition of the enrollee, if:

(a) The drug has been approved by the Food and Drug Administration with indications for the psychiatric condition of the enrollee or the use of the drug to treat that psychiatric condition is otherwise supported by medical or scientific evidence;

(b) The drug is prescribed by:

(1) A psychiatrist;

(2) A physician assistant under the supervision of a psychiatrist;

(3) An advanced practice registered nurse who has the psychiatric training and experience prescribed by the State Board of Nursing pursuant to NRS 632.120; or

(4) A primary care provider that is providing care to an enrollee in consultation with a practitioner listed in subparagraph (1), (2) or (3), if the closest practitioner listed in subparagraph (1), (2) or (3) who participates in the network plan of the prepaid limited health service organization is located 60 miles or more from the residence of the enrollee; and

(c) The practitioner listed in paragraph (b) who prescribed the drug knows, based on the medical history of the enrollee, or reasonably expects each alternative drug that is required to be used earlier in the step therapy protocol to be ineffective at treating the psychiatric condition.

2. Any provision of an evidence of coverage subject to the provisions of this chapter that is delivered, issued for delivery or renewed on or after July 1, 2023, which is in conflict with this section is void.

3. As used in this section:

(a) “Medical or scientific evidence” has the meaning ascribed to it in NRS 695G.053.

(b) “Network plan” means evidence of coverage offered by a prepaid limited health service organization under which the financing and delivery of medical care is provided, in whole or in part, through a defined set of providers under contract with the prepaid limited health service organization. The term does not include an arrangement for the financing of premiums.

(c) “Step therapy protocol” means a procedure that requires an enrollee to use a prescription drug or sequence of prescription drugs other than a drug that a practitioner recommends for treatment of a psychiatric condition of the enrollee before his or her evidence of coverage provides coverage for the recommended drug.

(Added to NRS by 2023, 1788)

NRS 695F.160 Rates and charges: Reasonableness. The rates and charges for a limited health service must be reasonable. The Commissioner may request information from the prepaid limited health service organization to determine the reasonableness of those rates and charges.

(Added to NRS by 1991, 1117)

NRS 695F.170 Procedure for modification of rates, charges, benefits, organization, operations, documents or services.

1. A prepaid limited health service organization shall file with the Commissioner a notice of any change in the rates, charges, benefits or any material change of any matter or document furnished pursuant to NRS 695F.110. The organization shall submit any proof necessary to justify the change. No such change is effective unless it is approved by the Commissioner. If the Commissioner does not disapprove of the change within 60 days after the notice is filed, the change shall be deemed approved.

2. If a prepaid limited health service organization wishes to add a limited health service, it shall submit:

(a) An application to the Commissioner;

(b) The information required by NRS 695F.110, if the information is different from the information filed with the prepaid limited health service organization’s application; and

Ê A prepaid limited health service organization may not add a limited health service if the Commissioner determines that adding the service would qualify the organization as a health maintenance organization pursuant to chapter 695C of NRS or as an offeror of a health care plan for which a certificate of authority is required by any other provisions of this title.

3. If the Commissioner does not deny the application within 60 days after it is filed, the application shall be deemed approved.

4. If the application is denied, the Commissioner shall send a written notice to the prepaid limited health service organization. The notice must include the reason for the denial. The prepaid limited health service organization may request a hearing in the manner set forth in NRS 695F.140.

(Added to NRS by 1991, 1116; A 1993, 2402)

NRS 695F.190 Requirements for reserve.

1. A prepaid limited health service organization shall set aside a reserve equal to 3 percent of the premiums collected from its enrollees in an amount not to exceed $500,000. The reserve is in addition to the bond or deposit filed with the Commissioner.

2. The reserve:

(a) Must be deposited in a trust account in a financial institution which is located in this state and which is federally insured or insured by a private insurer approved pursuant to NRS 672.755. The income earned on money in the account must be paid to the organization and used for its operations.

(b) Is in addition to the reserve established by the organization according to good business and accounting practices for incurred but unreported claims and other similar claims.

(Added to NRS by 1991, 1118; A 1999, 1554)

NRS 695F.200 Maintenance of capital account, surety bond or deposit and risk-based capital; determination of amount of increase by Commissioner.

1. Except as otherwise provided in this section, each prepaid limited health service organization which receives a certificate of authority shall maintain all of the following:

(a) A capital account with a net worth of not less than $500,000 unless a lesser amount is permitted in writing by the Commissioner. The account must not be obligated for any accrued liabilities and must consist of cash, securities or a combination thereof which is acceptable to the Commissioner.

(b) A surety bond or deposit of cash or securities for the protection of enrollees of not less than $500,000.

2. The Commissioner may increase the required amount of the organization’s capital account, surety bond or deposit and capital maintained pursuant to paragraph (c) of subsection 1 to any amount the Commissioner determines to be appropriate pursuant to subsection 3 if the Commissioner determines that such an increase is necessary to:

(a) Assist the Commissioner in the performance of his or her regulatory duties;

(b) Ensure that the organization complies with the requirements of this Code; or

3. When determining the appropriate amount of an increase pursuant to subsection 2, the Commissioner must base his or her determination on the type, volume and nature of premiums written and premiums assumed by the organization.

4. The amount of the organization’s capital account, surety bond or deposit and capital maintained pursuant to paragraph (c) of subsection 1, as required pursuant to subsections 1 and 2:

(a) Is in addition to any reserve required by this chapter and any reserve established by the organization according to good business and accounting practices for incurred but unreported claims and other similar claims; and

(b) May increase the amount of risk-based capital required pursuant to NRS 681B.550.

5. The amount of the organization’s surety bond or deposit and capital maintained pursuant to paragraph (c) of subsection 1, as required pursuant to subsections 1 and 2 may increase the amount of net worth required pursuant to subsections 1 and 2.

(Added to NRS by 1991, 1118; A 2017, 2400; 2019, 1722)

NRS 695F.210 Maintenance of fidelity bond or deposit in lieu of bond.

1. A prepaid limited health service organization shall maintain in force a fidelity bond in its own name on its officers and employees in an amount not less than $1,000,000 or in any other amount prescribed by the Commissioner.

2. Except as otherwise provided in subsection 3, the bond must be issued by an insurer licensed to do business in this State.

3. If the fidelity bond is not available from an insurer licensed to do business in this State, a prepaid limited health service organization may procure a fidelity bond from a surplus lines broker licensed pursuant to chapter 685A of NRS.

4. In lieu of the bond required pursuant to subsection 1, a prepaid limited health service organization may deposit with the Commissioner cash, securities or other investments described in paragraph (o) of subsection 1 of NRS 695F.090. The deposit must be maintained in joint custody with the Commissioner in the amount and subject to the same conditions required for a bond pursuant to this subsection.

(Added to NRS by 1991, 1119: A 2021, 2997)

NRS 695F.212 Hazardous financial condition: Regulations; determination; powers of Commissioner.

1. The Commissioner may adopt regulations to define when a prepaid limited health service organization is considered to be in a hazardous financial condition and to set forth the standards to be considered by the Commissioner in determining whether the continued operation of a prepaid limited health service organization transacting business in this State may be considered to be hazardous to its enrollees or creditors or to the general public.

2. If the Commissioner determines after a hearing that any prepaid limited health service organization is in a hazardous financial condition, the Commissioner may, instead of suspending or revoking the prepaid limited health service organization’s certificate of authority, limit the certificate of authority of the prepaid limited health service organization as the Commissioner deems reasonably necessary to correct, eliminate or remedy any conduct, condition or ground that is deemed to be a cause of the hazardous financial condition.

3. An order or decision of the Commissioner under this section is subject to review in accordance with NRS 679B.310 to 679B.370, inclusive, at the request of any party to the proceedings whose interests are substantially affected.

(Added to NRS by 2017, 2399)

NRS 695F.220 Contract between organization and provider or subcontractor for provision of services to enrollees: Required terms and conditions. Each contract between a prepaid limited health service organization and a provider or other person subcontracting for the provision of a limited health service to enrollees on a prepayment basis or any other basis must contain the following terms and conditions:

1. If the prepaid limited health service organization fails to pay for a limited health service for any reason, including, but not limited to, insolvency or breach of this contract, the enrollees are not liable to the provider for any money owed to the provider pursuant to this contract.

2. A provider, agent, trustee or assignee thereof may not maintain an action at law or attempt to collect from an enrollee any money which the prepaid limited health service organization owes to the provider.

3. These provisions do not prohibit the collection of any uncovered charges which an enrollee agreed to pay or the collection of any copayment from an enrollee.

4. These provisions survive the termination of this contract, regardless of the reason for the termination.

5. The termination of this contract does not release the provider from its obligation to complete any procedure on an enrollee who is receiving treatment for a specific condition for a period not to exceed 60 days, at the same schedule of copayment or any other applicable charge in effect when this contract is terminated.

6. Any amendment to the provisions of this contract must be submitted to the Commissioner for approval before the amendment is effective.

(Added to NRS by 1991, 1118)

NRS 695F.230 Establishment of system for resolution of complaints.

1. Each prepaid limited health service organization shall establish a system for the resolution of written complaints submitted by enrollees and providers.

2. The provisions of subsection 1 do not prohibit an enrollee or provider from filing a complaint with the Commissioner or limit the Commissioner’s authority to investigate such a complaint.

3. Each prepaid limited health service organization that issues any evidence of coverage that provides, delivers, arranges for, pays for or reimburses any cost of health care services through managed care shall provide a system for resolving any complaints of an enrollee or subscriber concerning those health care services that complies with the provisions of NRS 695G.200 to 695G.310, inclusive.

(Added to NRS by 1991, 1117; A 2003, 779; 2011, 3397)

REGULATION AND ENFORCEMENT

NRS 695F.300 Regulations. The Commissioner shall adopt regulations to carry out the provisions of this chapter.

(Added to NRS by 1991, 1121)

NRS 695F.310 Examinations and investigations.

1. The Commissioner may examine the affairs of any prepaid limited health service organization as often as is reasonably necessary to protect the interests of the residents of this State, but not less frequently than once every 3 years.

2. A prepaid limited health service organization shall make its books and records available for examination and cooperate with the Commissioner to facilitate the examination.

3. In lieu of such an examination, the Commissioner may accept the report of an examination conducted by the commissioner of insurance of another state.

4. An examination conducted pursuant to this section must be conducted in accordance with the provisions of NRS 679B.230 to 679B.300, inclusive.

5. A prepaid limited health service organization may be investigated in accordance with NRS 679B.600 to 679B.700, inclusive.

(Added to NRS by 1991, 1117; A 2007, 3331; 2019, 1722; 2021, 2997)

NRS 695F.320 Annual report and financial statement; quarterly statement; additional reports; penalties for failure to file report or statement.

1. Each prepaid limited health service organization shall file with the Commissioner annually, on or before March 1, a report showing its financial condition on the last day of the preceding calendar year. The report must be verified by at least two principal officers of the organization.

2. The report must be on a form prescribed by the Commissioner and include:

(a) A financial statement of the organization, including its balance sheet and receipts and disbursements for the preceding calendar year;

(b) The number of subscribers at the beginning and the end of the year and the number of enrollments terminated during the year; and

3. Each prepaid limited health service organization shall file with the Commissioner annually an audited financial statement prepared in accordance with the provisions of subsection 1 of NRS 680A.265.

4. Each prepaid limited health service organization shall file with the Commissioner and the National Association of Insurance Commissioners a quarterly statement in the form most recently adopted by the National Association of Insurance Commissioners for that type of insurer. The quarterly statement must be:

(a) Prepared in accordance with the instructions which are applicable to that form, including, without limitation, the required date of submission for the form; and

(b) Filed by electronic means.

5. The Commissioner may require more frequent reports containing such information as is necessary to enable the Commissioner to carry out his or her duties pursuant to this chapter.

6. The Commissioner may:

(a) Assess a fine of not more than $100 per day for each day a report or statement required pursuant to this section is not filed after the report or statement is due, but the fine must not exceed $3,000; and

(b) Suspend the organization’s certificate of authority until the organization files the report or statement, as applicable.

(Added to NRS by 1991, 1119; A 1995, 1634, 2683; 2019, 1723)

NRS 695F.330 Payment of premium tax. At the time of filing the annual report pursuant to NRS 695F.320 the prepaid limited health service organization shall forward to the Department of Taxation the tax and any penalty for nonpayment or delinquent payment of the tax in accordance with the provisions of chapter 680B of NRS.

(Added to NRS by 1991, 1121; A 1993, 1923)

NRS 695F.340 Fees. Each prepaid limited health service organization shall pay to the Commissioner the following fees:

For filing an application for a certificate of authority................................ $2,450

For issuance of a certificate of authority............................................................ 283

For the renewal of a certificate of authority................................................... 2,450

For filing a material change or addition of a limited health service.............. 100

For filing an annual report....................................................................................... 25

For filing periodic reports required by the Commissioner................................ 25

In addition to any other fee or charge, all applicable fees required pursuant to NRS 680C.110.

(Added to NRS by 1991, 1121; A 1993, 2403; 2009, 1821)

NRS 695F.350 Suspension or revocation of certificate of authority: Grounds; notice; hearing; effect.

1. The Commissioner may suspend or revoke the certificate of authority of a prepaid limited health service organization issued pursuant to this chapter if the Commissioner determines that:

(a) The prepaid limited health service organization is operating substantially in violation of its basic organizational document or in a manner contrary to the manner described in and reasonably inferred from any other information submitted pursuant to NRS 695F.110 unless any amendment to its basic organization document or other information has been filed with and approved by the Commissioner;

(b) The prepaid limited health service organization issued an evidence of coverage or used rates or charges which do not comply with the requirements of NRS 695F.150 and 695F.160;

(c) The prepaid limited health service organization is not able to carry out its obligations to provide its limited health service;

(d) The prepaid limited health service organization is not financially responsible and may reasonably be expected to be unable to carry out its obligations to enrollees or prospective enrollees;

(e) The capital of the prepaid limited health service organization is less than the amount required by NRS 695F.200 or the organization has failed to correct any deficiency concerning its capital as required by the Commissioner;

(f) The prepaid limited health service organization has failed to establish and maintain in a reasonable manner the complaint system required by NRS 695F.230;

(g) The continued operation of the prepaid limited health service organization would be hazardous to its enrollees; or

(h) The prepaid limited health service organization has failed to comply with any other provision of this chapter.

2. If the Commissioner has cause to believe that grounds for the suspension or revocation of a certificate of authority of a prepaid limited health service organization exist, the Commissioner shall send written notice to the organization. The notice must include the reason for the suspension or revocation and a time not more than 30 days thereafter for a hearing on the matter. The hearing must be held in the manner set forth in NRS 695F.140.

3. If the certificate of authority of a prepaid limited health service organization is revoked, the organization shall proceed, immediately following the effective date of the order of revocation, to wind up its affairs. The organization shall not:

(a) Conduct any further business unless it is essential for the orderly conclusion of its affairs; and

(b) Engage in any further advertising or solicitation.

4. The Commissioner may, by written order, permit such further operation of the organization as the Commissioner considers necessary to enable the enrollees to obtain limited health services from another organization or provider.

(Added to NRS by 1991, 1119)

NRS 695F.360 Violations of chapter: Order to cease and desist; fine. If the Commissioner, after a hearing held pursuant to NRS 695F.140, finds that a prepaid limited health service organization or other person subject to this chapter has violated a provision of this chapter, the Commissioner may:

1. Issue and cause to be served upon the organization or any other person charged with a violation of this chapter, a copy of the findings of the Commissioner and an order directing the organization or person to cease and desist from engaging in the act or practice which constitutes the violation; and

2. Impose a fine of not more than $1,000 for each violation, not to exceed a total amount of $10,000.

(Added to NRS by 1991, 1120)

MISCELLANEOUS PROVISIONS

NRS 695F.400 License required to apply, procure, negotiate or place for another any policy or contract of organization. A person shall not apply, procure, negotiate or place for another person any policy or contract of a prepaid limited health service organization unless he or she holds a license issued pursuant to chapter 683A of NRS.

(Added to NRS by 1991, 1118)

NRS 695F.410 Confidentiality and disclosure of information.

1. Any information relating to the diagnosis, treatment or health of any enrollee obtained from the enrollee or from any provider by a prepaid limited health service organization and any contract with a provider submitted pursuant to the requirements of this chapter must not be disclosed to any person except:

(a) To the extent that it is necessary to carry out the provisions of this chapter;

(b) Upon the written consent of the enrollee or applicant, provider or prepaid limited health service organization, as appropriate;

(d) For a claim or legal action if that data or information is relevant.

2. A prepaid limited health service organization may claim any privilege against disclosure which the provider who furnished the information relating to the diagnosis, treatment or health of an enrollee or applicant to the organization is entitled to claim.

(Added to NRS by 1991, 1121)

NRS 695F.420 Certain insurers and organizations authorized to exclude coverage duplicated pursuant to this chapter. Notwithstanding any other provision of this title, any person who is licensed as an insurer pursuant to chapter 680A of NRS or issued a certificate of authority pursuant to chapter 695A, 695B or 695C of NRS may exclude, in any contract or policy issued to a group, any coverage which would duplicate the coverage of a limited health service, whether for services, supplies or reimbursement, to the extent that the coverage or service is provided in accordance with this chapter pursuant to a contract or policy issued to the same group or to a part of that group by a prepaid limited health service organization or a person who is licensed as an insurer pursuant to chapter 680A of NRS or issued a certificate of authority pursuant to chapter 695A, 695B or 695C of NRS.

(Added to NRS by 1991, 1117)

NRS 695F.430 Provision of services excluded from practice of any healing arts; solicitation excluded from provisions regarding solicitation or advertising by practitioner of healing art.

1. The provision of limited health services by a prepaid limited health service organization or any other person pursuant to this chapter shall not be deemed to be the practice of medicine or any other healing arts.

2. The solicitation by a prepaid limited health service organization to arrange for or provide a limited health service in accordance with this chapter does not violate any statutory provision relating to solicitation or advertising by a practitioner of a healing art.

(Added to NRS by 1991, 1117)

ELIGIBILITY FOR COVERAGE

NRS 695F.440 Effect of eligibility for medical assistance under Medicaid; assignment of rights to state agency.

1. An organization shall not, when considering eligibility for coverage or making payments under any evidence of coverage, consider the availability of, or eligibility of a person for, medical assistance under Medicaid.

2. To the extent that payment has been made by Medicaid for health care, a prepaid limited health service organization:

(a) Shall treat Medicaid as having a valid and enforceable assignment of benefits due a subscriber or claimant under the subscriber regardless of any exclusion of Medicaid or the absence of a written assignment; and

(b) May, as otherwise allowed by its evidence of coverage or contract and applicable law or regulation concerning subrogation, seek to enforce any rights of a recipient of Medicaid against any other liable party if:

(1) It is so authorized pursuant to a contract with Medicaid for managed care; or

(2) It has reimbursed Medicaid in full for the health care provided by Medicaid to its subscriber.

3. If a state agency is assigned any rights of a person who is:

(a) Eligible for medical assistance under Medicaid; and

(b) Covered by any evidence of coverage,

Ê the prepaid limited health service organization that issued the evidence of coverage shall not impose any requirements upon the state agency except requirements it imposes upon the agents or assignees of other persons covered by any evidence of coverage.

4. If a state agency is assigned any rights of a subscriber who is eligible for medical assistance under Medicaid, a prepaid limited health service organization shall:

(a) Upon request of the state agency, provide to the state agency information regarding the subscriber to determine:

(1) Any period during which the subscriber, the spouse or a dependent of the subscriber may be or may have been covered by the organization; and

(2) The nature of the coverage that is or was provided by the organization, including, without limitation, the name and address of the subscriber and the identifying number of the evidence of coverage;

(b) Respond to any inquiry by the state agency regarding a claim for payment for the provision of any medical item or service not later than 3 years after the date of the provision of the medical item or service; and

(c) Agree not to deny a claim submitted by the state agency solely on the basis of the date of submission of the claim, the type or format of the claim form or failure to present proper documentation at the point of sale that is the basis for the claim if:

(1) The claim is submitted by the state agency not later than 3 years after the date of the provision of the medical item or service; and

(2) Any action by the state agency to enforce its rights with respect to such claim is commenced not later than 6 years after the submission of the claim.

(Added to NRS by 1995, 2437; A 2007, 2407)

NRS 695F.450 Organization prohibited from asserting certain grounds to deny enrollment of child pursuant to order if parent is insured. A prepaid limited health service organization shall not deny the enrollment of a child pursuant to an order for medical coverage under any evidence of coverage pursuant to which a parent of the child is insured on the ground that the child:

1. Was born out of wedlock;

2. Has not been claimed as a dependent on the parent’s federal income tax return; or

3. Does not reside with the parent or within the organization’s geographic area of service.

(Added to NRS by 1995, 2438)

NRS 695F.460 Certain accommodations required to be made when child is covered under evidence of coverage of noncustodial parent. If a child has coverage under any evidence of coverage pursuant to which a noncustodial parent of the child is insured, the prepaid limited health service organization issuing that evidence of coverage shall:

1. Provide to the custodial parent such information as necessary for the child to obtain any benefits under that coverage.

2. Allow the custodial parent or, with the approval of the custodial parent, a provider to submit claims for covered services without the approval of the noncustodial parent.

3. Make payments on claims submitted pursuant to subsection 2 directly to the custodial parent, the provider or an agency of this or another state responsible for the administration of Medicaid.

(Added to NRS by 1995, 2438)

NRS 695F.470 Organization required to authorize enrollment of child of parent who is required by order to provide medical coverage under certain circumstances; termination of coverage of child. If a parent is required by an order for medical coverage to provide coverage for a child and the parent is eligible for coverage of members of the family of the parent under any evidence of coverage, the prepaid limited health service organization that issued the evidence of coverage:

1. Shall, if the child is otherwise eligible for that coverage, allow the parent to enroll the child in that coverage without regard to any restrictions upon periods for enrollment.

2. Shall, if:

(a) The child is otherwise eligible for that coverage; and

(b) The parent is enrolled in that coverage but fails to apply for enrollment of the child,

Ê enroll the child in that coverage upon application by the other parent of the child, or by an agency of this or another state responsible for the administration of Medicaid or a state program for the enforcement of child support established pursuant to 42 U.S.C. §§ 651 et seq., without regard to any restrictions upon periods for enrollment.

3. Shall not terminate the enrollment of the child in that coverage or otherwise eliminate that coverage of the child unless the prepaid limited health service organization has written proof that:

(a) The order for medical coverage is no longer in effect; or

(b) The child is or will be enrolled in comparable coverage through another insurer on or before the effective date of the termination of enrollment or elimination of coverage.

(Added to NRS by 1995, 2438)