NAC: CHAPTER 695D - ORGANIZATIONS FOR DENTAL CARE

[Rev. 8/27/2018 12:30:41 PM]

[NAC-695D Revised Date: 8-18]

CHAPTER 695D - ORGANIZATIONS FOR DENTAL CARE

GENERAL PROVISIONS

695D.010 Definitions.

695D.015 “Commissioner” defined.

695D.020 “Division” defined.

695D.025 “Member” defined.

695D.030 “Organization” defined.

695D.040 “Plan” defined.

695D.045 “Policy” defined.

695D.050 “Provider” defined.

695D.060 “Service” defined.

APPLICATION FOR CERTIFICATE OF AUTHORITY

695D.070 Submission; format.

695D.080 Contents.

695D.090 Applicant licensed in another state.

695D.100 Incomplete application.

695D.110 Request to review or obtain copy; notification of pending application.

ADMINISTRATION AND RECORDS

695D.120 Name of organization.

695D.130 Maintenance of principal office and place of business.

695D.140 Maintenance of records.

695D.150 Qualifications of person responsible for operating organization.

695D.160 Powers of organization; approval by Commissioner.

695D.170 Accessibility of services.

695D.180 Organization desiring to enlarge its geographic area of service.

695D.190 Contract between organization and provider.

695D.200 Notification of disassociation of dentist from organization.

695D.220 Coordination of benefits.

695D.225 Summary of coverage: Filing, contents and delivery of disclosure.

695D.230 Provision of copy of plan to members; advertising; solicitation.

FINANCES

695D.240 Reserves maintained by organization.

695D.250 Investment of money.

695D.260 Filing of periodic reports and financial statements; quarterly report of domestic organization; extension of time for filing report or statement; disciplinary action for failure to file report or statement.

695D.270 Determination of financial condition: Assets considered.

695D.280 Determination of financial condition: Assets not considered.

695D.290 Determination of financial condition: Charges against assets.

695D.300 Maintenance of financial security.

ORGANIZATIONS LICENSED IN OTHER STATES

695D.310 Submission of copy of license to Commissioner.

695D.320 Organization desiring to contract with providers out of State for services for members in State.

695D.330 Notification of disciplinary action taken in another state.

MISCELLANEOUS PROVISIONS

695D.340 Certification of information concerning limitation on rates for coverage.

695D.350 Contract to perform marketing, enrollment or administrative services.

695D.360 Administrative hearings and other proceedings.

695D.370 Requirements for conducting examinations.

SYSTEM FOR RESOLVING COMPLAINTS OF MEMBERS

695D.500 Establishment; scope; examination of system.

695D.510 Requirements for approval.

695D.520 Notices: Right of member to file complaint; denial of coverage; clear and comprehensible language.

695D.530 Annual report: Submission; resolution of oral inquiry.

695D.540 Annual report: Content; maintenance of records.

GENERAL PROVISIONS

NAC 695D.010 Definitions. (NRS 679B.130, 695D.100) As used in this chapter, unless the context otherwise requires, the words and terms defined in NAC 695D.015 to 695D.060, inclusive, have the meanings ascribed to them in those sections.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88; A by R132-98, 3-30-99)

NAC 695D.015 “Commissioner” defined. “Commissioner” means the Commissioner of Insurance.

(Supplied in codification)

NAC 695D.020 “Division” defined. (NRS 679B.130, 695D.100) “Division” means the Division of Insurance of the Department of Business and Industry.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88; A 5-27-92)

NAC 695D.025 “Member” defined. (NRS 679B.130, 695D.100) “Member” has the meaning ascribed to it in NRS 695D.050.

(Added to NAC by Comm’r of Insurance by R132-98, eff. 3-30-99)

NAC 695D.030 “Organization” defined. (NRS 679B.130, 695D.100) “Organization” means an organization for dental care as defined by NRS 695D.060.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88)

NAC 695D.040 “Plan” defined. (NRS 679B.130, 695D.100) “Plan” means a plan for dental care as defined by NRS 695D.070.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88)

NAC 695D.045 “Policy” defined. (NRS 679B.130, 695D.100) “Policy” has the meaning ascribed to it in NRS 695D.080.

(Added to NAC by Comm’r of Insurance by R132-98, eff. 3-30-99)

NAC 695D.050 “Provider” defined. (NRS 679B.130, 695D.100) “Provider” means a person who provides dental care.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88)

NAC 695D.060 “Service” defined. (NRS 679B.130, 695D.100) “Service” means the provision of dental care.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88)

APPLICATION FOR CERTIFICATE OF AUTHORITY

NAC 695D.070 Submission; format. (NRS 679B.130, 695D.100, 695D.120)

1. An organization that applies for a certificate of authority must submit to the Commissioner an original and two copies of its application.

2. The original and each copy of the application must be submitted in a binder having three rings. The original application, the original of the completed forms supplied by the Division and the originals or certified copies of any supporting documents must all be contained in a single binder.

3. Each binder must contain a table of contents and dividers that separate the various sections of the application and indicate the subject of each section.

4. If an applicant submits any new pages to supplement or amend its application, the date of submission must be noted on the bottom of each page, and each page must be prepared so that it may be placed in the binder with the other materials.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88; A 5-27-92)

NAC 695D.080 Contents. (NRS 679B.130, 695D.100, 695D.120)

1. In addition to the information required to be submitted pursuant to NRS 695D.120, an applicant for a certificate of authority shall include in its application:

(a) A list of its actual and prospective providers;

(b) A clear description of the geographic area it proposes to serve;

(c) A statement of facts demonstrating, with particular reference to the location of its providers and any provision made by them for emergencies, that the services of providers will be reasonably available to members;

(d) A description of the measures to be taken to increase the number of its providers as the number of members increases; and

(e) If the applicant is affiliated with an insurer:

(1) A description of its relationship with the insurer; and

(2) The information required by chapter 692C of NRS for filings by an insurance holding company system.

2. Financial statements and projections submitted as part of an application must be prepared in accordance with statutory principles of insurance accounting.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88)

NAC 695D.090 Applicant licensed in another state. (NRS 679B.130, 695D.100, 695D.120) Any applicant licensed as an organization in another state, or having an affiliate or subsidiary that is so licensed, shall include in its application:

1. A copy of the license; and

2. If it is available, a certificate from the agency of the state responsible for regulating the organization, stating that the organization is licensed in good standing.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88)

NAC 695D.100 Incomplete application. (NRS 679B.130, 695D.100)

1. Any incomplete application, with respect to which there is no activity by the applicant for 60 days or more, shall be deemed to have been withdrawn by the applicant.

2. If an application is deemed withdrawn, the Division will give written notice to the applicant of the status of the application. A new application, together with all applicable fees, including, without limitation, all applicable fees required by NRS 695D.130, must be submitted before the Division takes any further action.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88; A 5-27-92; R103-09, 1-28-2010)

NAC 695D.110 Request to review or obtain copy; notification of pending application. (NRS 679B.130, 695D.100)

1. Any person who wishes to review or obtain a copy of an application for a certificate of authority must submit a written request to the offices of the Division at 1818 East College Parkway, Suite 103, Carson City, Nevada 89706. If a copy is requested, a fee in an amount sufficient to cover the cost of the copy and any cost of postage must be submitted with the request.

2. Any person who wishes to be notified of a pending application must file with the Division a written request to be placed on a list maintained by the Division for that purpose.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88; A 5-27-92; R249-03, 11-12-2004)

ADMINISTRATION AND RECORDS

NAC 695D.120 Name of organization. (NRS 679B.130, 695D.100) The name of an organization must not include the words “health” or “medical” or in any way imply coverage for other than dental care, unless the word “dental” is used in the name.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88)

NAC 695D.130 Maintenance of principal office and place of business. (NRS 679B.130, 695D.100)

1. Except as otherwise provided in subsection 2, every domestic organization must maintain its principal office and place of business in this State.

2. The Commissioner, for good cause shown, may permit an organization to maintain its principal office or place of business in another state if it is:

(a) In the best interests of the organization and its members; and

(b) Reasonably convenient to the Commissioner in supervising the insurer.

3. Permission granted pursuant to this subsection is subject to such reasonable terms and conditions as the Commissioner establishes in the order granting permission.

4. For the purposes of this section, “domestic organization” means an organization formed under the laws of this State.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88)

NAC 695D.140 Maintenance of records. (NRS 679B.130, 695D.100)

1. An organization shall retain permanently, on microfilm or by other suitable means, the minutes of each meeting of its governing body and any advisory panel on members’ satisfaction.

2. An organization shall retain for 3 years, or until an examination of the organization has been completed by the Division, a copy of all published material used to market the organization and scripts used for advertising on radio or television.

3. The records of an organization must be segregated from the records of any subsidiary or related corporation and must be treated as separate corporate documents.

4. All records of the organization must be kept in this State and retained for examination by the Division for 3 years or until the next examination is completed by the Division. Each organization shall comply with the provisions of NRS 693A.050, 693A.060 and 693A.070.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88; A 5-27-92)

NAC 695D.150 Qualifications of person responsible for operating organization. (NRS 679B.130, 695D.100) Each person responsible for operating an organization must possess adequate knowledge concerning the operation of such an organization and insurance laws and procedures that apply to the organization.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88)

NAC 695D.160 Powers of organization; approval by Commissioner. (NRS 679B.130, 695D.100)

1. Subject to the approval of the Commissioner as provided in subsections 2 and 3, the powers of an organization include the power to:

(a) Purchase, lease, construct, renovate, operate or maintain any dental facility, ancillary equipment or other property reasonably required for its principal office or any other purpose related to the business of the organization.

(b) Make any loan in furtherance of its program to provide services to its members:

(1) To a dental group under contract with the organization; or

(2) To a corporation under its control.

(d) Contract with any person for the performance of services related to marketing, enrollment and administration.

(e) Contract with any insurance company that is licensed in this State or is authorized to do business in this State for the provision of insurance for, indemnity against, or reimbursement of the cost of services provided by the organization.

2. The exercise of any power specified in subsection 1 must be approved in advance by the Commissioner. A written request to exercise any such power must be submitted to the Commissioner, accompanied by such supporting information as the Commissioner deems necessary to review the request. The Commissioner may deny the request if he or she determines that the exercise of the power would:

(a) Have a substantial adverse effect upon the financial soundness of the organization; and

(b) Impair the ability of the organization to meet its obligations.

3. If the Commissioner does not deny a request within 60 days after it is submitted, it shall be deemed approved.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88)

NAC 695D.170 Accessibility of services. (NRS 679B.130, 695D.100) If the geographic area served or proposed to be served by an organization:

1. Includes a county having a population of 30,000 or more, the distance between the place of business of any provider and that of any subscriber must not exceed 25 miles. As used in this subsection, “subscriber” means a person who purchases a plan for himself or herself or another person pursuant to a written contract with the organization.

2. Does not include a county having a population of 30,000 or more, the organization must submit:

(a) With its application; and

(b) At any time thereafter, upon request of the Commissioner,

Ê a statement demonstrating, with reference to the standards of the area for accessibility, that the services of providers are or will be reasonably available to members.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88)

NAC 695D.180 Organization desiring to enlarge its geographic area of service. (NRS 679B.130, 695D.100, 695D.140) If an organization wishes to enlarge its geographic area of service beyond that stated in its application, it must submit to the Division:

1. A written description of the area it proposes to serve;

2. A list of the providers who will offer services to members in the new area;

3. A copy of the contract between the organization and each such provider;

4. A statement:

(a) Describing the effect of the expansion on the operation and financial position of the organization; and

(b) Certifying that the expansion is financially feasible for the organization;

5. A statement describing the method of marketing and the projected number of members in the new area; and

6. Evidence that the organization has given notice of the proposed expansion to the insurers for its contracts of surety, fidelity and stop loss insurance.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88; A 5-27-92)

NAC 695D.190 Contract between organization and provider. (NRS 679B.130, 695D.100)

1. Each contract between an organization and a provider must:

(a) Contain a complete description of the duties of each party under the agreement.

(b) Require the provider to release each member of the organization from all liability for the cost of services rendered under the plan, except for uncovered expenditures and any copayments or deductibles made by a member.

(d) Require the provider to comply with the organization’s program to assure the quality of dental care provided to members.

(e) If the organization becomes insolvent, require the provider to provide to each member all the services specified by the plan and the agreement during the period for which a premium has been paid by or on behalf of the member.

(f) Require the provider to furnish the organization with evidence of:

(1) A contract of insurance against liability to third persons for any injury caused by professional malpractice; or

(2) A reasonable substitute for such insurance, as determined by the organization.

(g) Require a provider, if he or she leaves the panel of dentists associated with the organization, to transfer or arrange for the maintenance of the records of members who are his or her patients.

2. An organization may require a provider to indemnify it against liability to third persons resulting from services rendered by the provider.

3. As used in this section, “uncovered expenditures” means the cost of any services, including services provided during an emergency:

(a) That are rendered by a provider and paid for by the organization;

(b) Concerning which there is no agreement between the provider and organization to release the member from liability; and

(Added to NAC by Comm’r of Insurance, eff. 12-2-88)

NAC 695D.200 Notification of disassociation of dentist from organization. (NRS 679B.130, 695D.100) An organization shall notify a member in writing of the disassociation of his or her dentist from the organization within 30 working days after the disassociation occurs.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88; A 5-27-92; R081-16, 11-2-2016)

NAC 695D.220 Coordination of benefits. (NRS 679B.130, 695D.100)

1. A plan that is offered to a group and that coordinates its benefits must determine its benefits and its order of benefits as provided in NRS 689B.063 and 689B.064.

2. An organization may include in its evidence of coverage provisions:

(a) Prohibiting the duplication of benefits; and

(b) Stating its intention to impose a lien, upon any money recovered by a member from a third person for injuries inflicted by that person, for the cost of any benefits provided to the member in connection with those injuries. The amount of the lien must not exceed the reasonable value of the services provided by the organization.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88)

NAC 695D.225 Summary of coverage: Filing, contents and delivery of disclosure. (NRS 679B.130, 695D.100, 695D.102)

1. Each organization for dental care shall file with the Commissioner, for his or her approval, a disclosure summarizing the coverage provided by a group plan for dental care offered by the organization for dental care.

2. The disclosure must:

(a) Be in at least 10-point type;

(b) Include the name, address and telephone number of the organization for dental care;

(d) Include a statement describing the principal benefits and the type of coverage being provided;

(e) Include a description of any provision of the plan for dental care which significantly excludes, eliminates, reduces or in any other manner operates to limit the payment of the benefits;

(f) Include a statement concerning the renewal provisions of the plan; and

(g) Define the term “usual and customary” or any similar term used in the plan.

3. The agent for the organization for dental care, the organization after a response to a direct-response solicitation or the broker representing the member shall deliver the approved disclosure summary to the proposed group policyholder as provided in NRS 695D.104.

(Added to NAC by Comm’r of Insurance, eff. 2-21-90)

NAC 695D.230 Provision of copy of plan to members; advertising; solicitation. (NRS 679B.130, 695D.100)

1. Each organization shall, at the time a member enrolls, provide the member with a copy of its plan which:

(a) States clearly, in boldface type, any period of waiting required before a member is eligible to receive benefits under the plan; and

(b) Refers to the plan by the number used in filing it with the Division.

2. Each advertisement of an organization must comply with the provisions of NAC 689A.010 to 689A.270, inclusive.

3. An organization may not solicit door to door for new members.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88; A 5-27-92)

FINANCES

NAC 695D.240 Reserves maintained by organization. (NRS 679B.130, 695D.100, 695D.250) All reserves maintained by an organization pursuant to NRS 695D.250:

1. Must be deposited in a trust account in a federally insured financial institution located in this State. All income earned by the account belongs to the organization and may be credited and paid to the organization and used for its operations.

2. Are in addition to those reserves established by the organization according to good business and accounting practices to cover claims that have been incurred but not reported and other similar claims.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88)

NAC 695D.250 Investment of money. (NRS 679B.130, 695D.100)

1. An organization may invest its money only in cash, cash equivalents or the securities described in NRS 682A.033.

2. Any investment made by an organization:

(a) Must be authorized or ratified by its board of directors or by a committee charged with the supervision of such investments;

(b) Must be interest-bearing, interest-accruing, entitled to dividends or otherwise produce income;

(d) Must not be purchased at a price above its fair or market value; and

(e) Must comply with the provisions of NRS 682A.402, to the extent those provisions are applicable.

3. An organization may receive for its use and benefit the interest or other income accruing on its investments.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88; A by R089-17, 5-16-2018)

NAC 695D.260 Filing of periodic reports and financial statements; quarterly report of domestic organization; extension of time for filing report or statement; disciplinary action for failure to file report or statement. (NRS 679B.130, 695D.100, 695D.260)

1. As a condition of doing business in this State, each organization must submit to the Commissioner an annual report required by NRS 695D.260 that:

(a) Conforms to the format prescribed by the National Association of Insurance Commissioners in the Annual and Quarterly Statement Instructions for Health and the Accounting Practices and Procedures Manual, which have been adopted by reference in NAC 679B.033;

(b) Contains exhibits and schedules that follow the specifications developed by the National Association of Insurance Commissioners; and

2. Information from the annual report of the organization must be filed:

(a) Pursuant to the specifications adopted by the National Association of Insurance Commissioners for filing information in an electronic format;

(b) At the central office of the National Association of Insurance Commissioners, 1100 Walnut Street, Suite 1500, Kansas City, Missouri 64106-2197; and

3. If a foreign or alien organization files a report in an electronic format with the National Association of Insurance Commissioners, that report will be deemed to have been filed with the Commissioner if:

(a) The foreign or alien organization submits an affidavit, a jurat page or a copy of the jurat page to the Commissioner indicating that the report has been so filed. If the organization submits a jurat page, the jurat page must:

(1) Conform to the format prescribed by the National Association of Insurance Commissioners in the Annual and Quarterly Statement Instructions for Health, which has been adopted by reference in NAC 679B.033; and

(2) Be executed by a notarial officer pursuant to NRS 240.1655 and 240.167.

(b) The affidavit, jurat page or copy of the jurat page, is accompanied by the applicable fees set forth in NRS 680B.010.

4. An annual report required by NRS 695D.260 to be filed with the Commissioner by an organization must be on the current version of the Annual and Quarterly Statement Blanks for Health adopted by the National Association of Insurance Commissioners, which has been adopted by reference in NAC 679B.033. Each organization shall, in preparing the report, follow the Annual and Quarterly Statement Instructions for Health adopted by the National Association of Insurance Commissioners, which accompanies the Annual and Quarterly Statement Blanks for Health.

5. If necessary to determine the financial condition of a foreign or alien organization or the fulfillment of contractual obligations or compliance with law by a foreign or alien organization, the Commissioner may require the foreign or alien organization to file a financial report more frequently than annually. Such a report must be:

(a) Filed on the current form adopted by the National Association of Insurance Commissioners for the type of organization filing;

(b) Completed in accordance with the instructions accompanying that form; and

6. Each domestic organization shall file a quarterly report with the Commissioner. A quarterly report must be:

(a) Filed on the current form adopted by the National Association of Insurance Commissioners for the type of organization reporting;

(b) Completed in accordance with the instructions accompanying that form; and

7. The audited financial statement of the organization filed pursuant to subsection 3 of NRS 695D.260 is a separate document from the annual statement required to be filed pursuant to paragraph (a) of subsection 2 of NRS 695D.260. Each organization filing the audited financial statement shall follow the Annual and Quarterly Statement Instructions for Health adopted by the National Association of Insurance Commissioners. Consolidated statements for organizations that are members of an insurance holding company are not acceptable.

8. The Commissioner will, if appropriate, take disciplinary action pursuant to NRS 695D.300 against an organization which fails to file its annual financial reports or statements on the prescribed forms, in the prescribed format or by the prescribed date.

9. The Commissioner may grant a reasonable extension of time for filing the annual report or the audited financial statement required by NRS 695D.260 if the request for an extension is submitted in writing and in advance and shows good cause.

10. As used in this section, “jurat page” means a written declaration by a notarial officer that the signer of a document signed the document in the presence of the notarial officer and swore to or affirmed that the statements in the document are true.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88; A 12-9-91; R249-03, 11-12-2004; R089-17, 5-16-2018)

NAC 695D.270 Determination of financial condition: Assets considered. (NRS 679B.130, 695D.100) The Division will consider the following assets owned by an organization in determining its financial condition:

1. Cash in the possession of the organization or in transit under its control, including the true balance of any deposit in a solvent bank, trust company or savings and loan association.

2. Any investment or security acquired or held as provided in NAC 695D.250.

3. Any asset acquired through the exercise of its powers contained in paragraphs (a) and (b) of subsection 1 of NAC 695D.160 and approved pursuant to subsections 2 and 3 of that section.

4. Any interest due or accrued on:

(a) Any bond that is not in default and is not valued on a basis that includes accrued interest.

(b) Cash deposited in a solvent bank, trust company or savings and loan association.

5. The unaccrued portion of any tax paid before the date it is due.

6. Any premium in collection, less any commission payable on the premium. Except for a premium payable directly or indirectly by the Federal Government or by any of its instrumentalities, a premium in collection will not be considered for the purposes of this section if it is more than 60 days past due.

7. The full amount of reinsurance recoverable by an organization from a solvent reinsurer.

8. The cost of any machine and related equipment used for a data processing, recordkeeping or accounting system, if:

(a) That cost is not less than $5,000 per system;

(b) The cost is amortized in full over a period of not more than 5 years; and

9. Any property acquired through the exercise of its powers contained in NAC 695D.160.

10. To the extent consistent with the provisions of this chapter and at such value as the Commissioner may determine, any other asset deemed by the Commissioner to be available for the payment of claims.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88; A 5-27-92)

NAC 695D.280 Determination of financial condition: Assets not considered. (NRS 679B.130, 695D.100) The Division will not consider the following assets owned by an organization in determining its financial condition:

1. Any goodwill, trade name or similar intangible.

2. Any advance to an officer of the organization, whether secured or unsecured, and any advance made on personal security only.

3. Stock of the organization, owned by the organization, or any equity therein or loans secured thereby, or any proportionate interest in stock acquired or held through the ownership by the organization in another firm, corporation or business.

4. Except as otherwise provided in NAC 695D.270, any furniture, fixture, furnishing, safe, vehicle, library, stationery, literature or supplies.

5. The amount, if any, by which the aggregate book value of investments carried in the ledger assets of the organization exceeds the aggregate value thereof.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88; A 5-27-92)

NAC 695D.290 Determination of financial condition: Charges against assets. (NRS 679B.130, 695D.100) In determining the financial condition of an organization, the Division will charge against its assets:

1. The amount of its outstanding capital stock.

2. The amount necessary to pay any unpaid claims against the organization that are incurred on or before the date of its financial statement, whether the claims are reported or unreported, plus the expenses of adjusting those claims.

3. Unless a larger amount is required by NRS 695D.250, the amount of the unearned premium reserves of the organization, computed as provided in NRS 681B.080.

4. All taxes, expenses and other obligations of the organization that are due or accrued as of the date of its financial statement.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88; A 5-27-92)

NAC 695D.300 Maintenance of financial security. (NRS 679B.130, 695D.100, 695D.250)

1. An organization shall maintain:

(a) A capital account with a net worth in an amount which is the greater of:

(1) The amount of risk-based capital determined in the manner set forth in NRS 681B.550 and the regulations adopted pursuant thereto; or

(2) The amount, according to the number of members in the organization, that is not less than the following amounts:

Number of Members Net Worth

Less than 2,500 $50,000

2,500 to 5,000 $75,000

5,000 or more $125,000

(b) Except as otherwise provided in this paragraph, a surety bond or deposit of cash or securities for the protection of members of not less than the amount required by NRS 695D.170. The Commissioner will allow the bond or deposit to be reduced to $125,000 until the organization has 5,000 members.

(d) A contract of insurance providing that, in the event the organization is declared insolvent by the Division or a court of competent jurisdiction, the insurer will pay all claims made by a member from the first dollar of eligible expenses for a period of not less than 60 days. If this coverage is cancelled, written notice of the cancellation must be given to the Division by the organization and its insurer not less than 90 days before the cancellation becomes effective. The insurer may require the organization to include in its agreements with its providers, a requirement that the provider accept any assignment made by the organization to the insurer for the continuation of benefits upon the insolvency of the organization.

(e) A contract of insurance to stop the losses of the organization, in an amount acceptable to the Commissioner.

2. The reserves required by NRS 695D.250 must be segregated in a trust fund located in a federally insured financial institution in this State. Any interest earned on the fund may be credited to the organization.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88; A 5-27-92; R005-03, 2-12-2004; R249-03, 11-12-2004)

ORGANIZATIONS LICENSED IN OTHER STATES

NAC 695D.310 Submission of copy of license to Commissioner. (NRS 679B.130, 695D.100) An organization that:

1. Receives a license as an organization in another state; or

2. Whose affiliate or subsidiary receives such a license,

Ê shall furnish a copy of the license to the Commissioner within 30 days after it is received.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88)

NAC 695D.320 Organization desiring to contract with providers out of State for services for members in State. (NRS 679B.130, 695D.100)

1. If an organization authorized to operate in this State is also licensed in a contiguous state and wishes to contract with providers in that state for services for members in this State, the organization shall submit to the Division, for its review and approval:

(a) Two copies of the plan of the organization for operation in the contiguous state;

(b) A copy of the evidence of coverage to be issued, if it has not previously been filed with the Division;

(d) Such other material concerning the administration of the plan as the Division deems necessary for its review.

2. The Division will consider such a plan to be a material modification of the operations of the organization in this State.

3. The Division, before it approves the plan, will consider whether the contiguous state will approve the plan.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88; A 5-27-92)

NAC 695D.330 Notification of disciplinary action taken in another state. (NRS 679B.130, 695D.100) An organization authorized to operate in this State that is licensed in another state shall:

1. Notify the Division of any disciplinary action taken against it by the other state; and

2. File with the Division copies of all documents relating to that action within 10 days after it receives those documents.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88; A 5-27-92)

MISCELLANEOUS PROVISIONS

NAC 695D.340 Certification of information concerning limitation on rates for coverage. (NRS 679B.130, 695D.100) Any information provided by an organization to demonstrate its compliance with the provisions of NRS 686B.125, limiting rates for coverage for dental care, must be certified by an actuary.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88)

NAC 695D.350 Contract to perform marketing, enrollment or administrative services. (NRS 679B.130, 695D.100)

1. If an organization enters into a contract for the performance of marketing, enrollment or administrative services, it shall submit a copy of the contract to the Division for its review and approval.

2. A person who enters into such a contract with an organization shall be deemed to have:

(a) Submitted himself or herself to the jurisdiction of the Division for the purposes of the review; and

(b) Authorized the Division to examine him or her concerning:

(1) His or her duties under the contract; and

(2) The payment and handling of money pursuant to the contract.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88; A 5-27-92)

NAC 695D.360 Administrative hearings and other proceedings. (NRS 679B.130, 695D.100)

1. Any person who is not otherwise entitled to a hearing pursuant to NRS 695D.310 and who is aggrieved by an action of the Commissioner relating to the approval, denial, suspension or revocation of a certificate of authority may request a hearing on the matter as provided in NRS 679B.310.

2. Any person who wishes to:

(a) Be notified of a pending hearing must file with the Division a written request to be placed on a list maintained by the Division for that purpose.

(b) Intervene in any proceeding held pursuant to NRS 695D.310 may request leave to intervene as provided in NAC 679B.460, 679B.470 and 679B.480.

3. Except as otherwise provided in this chapter and chapter 695D of NRS, any administrative proceeding relating to an organization must be held as provided in NAC 679B.161 to 679B.480, inclusive.

(Added to NAC by Comm’r of Insurance, eff. 12-2-88; A 5-27-92; 12-15-94)

NAC 695D.370 Requirements for conducting examinations. (NRS 679B.130, 695D.100, 695D.270) Each examination of an organization, including one made pursuant to NRS 695D.270, must be conducted pursuant to the requirements found in the handbooks and manuals adopted by reference in NAC 679B.033 and the provisions of NRS 679B.250 to 679B.300, inclusive.

(Added to NAC by Comm’r of Insurance, eff. 12-9-91)

SYSTEM FOR RESOLVING COMPLAINTS OF MEMBERS

NAC 695D.500 Establishment; scope; examination of system. (NRS 679B.130, 695D.100)

1. Each organization that issues a policy in this State shall establish with the approval of the Commissioner a system for resolving any complaints of a member concerning services covered under the policy. In determining whether to approve a system for resolving complaints, the Commissioner will consult with the State Board of Health.

2. A system for resolving complaints pursuant to subsection 1 must include an initial investigation, a review of the complaint by a review board and a procedure for appealing a determination regarding the complaint. The majority of the persons on a review board must be members who receive services pursuant to a policy issued by the organization.

3. Each organization shall allow the Commissioner or the State Board of Health to examine the system for resolving complaints established pursuant to this section at such times as either deems necessary or appropriate.

(Added to NAC by Comm’r of Insurance by R132-98, eff. 3-30-99)

NAC 695D.510 Requirements for approval. (NRS 679B.130, 695D.100) To obtain approval of a system for resolving complaints of members concerning services covered by an organization from the Commissioner as required pursuant to NAC 695D.500, an organization must:

1. Demonstrate that the system will resolve oral and written complaints concerning:

(a) Payment or reimbursement for covered services;

(b) The availability, delivery or quality of covered services, including, without limitation, adverse determinations made pursuant to utilization review; and

2. Submit to the Division:

(a) The name and title of the employee responsible for the system;

(b) A description of the procedure used to notify a member of the decision regarding his or her complaint; and

(Added to NAC by Comm’r of Insurance by R132-98, eff. 3-30-99)

NAC 695D.520 Notices: Right of member to file complaint; denial of coverage; clear and comprehensible language. (NRS 679B.130, 695D.100)

1. Following approval by the Commissioner, each organization that issues a policy in this State shall provide written notice to a member, in clear and comprehensible language that is understandable to an ordinary layperson, explaining the right of the member to file a written complaint. Such notice must be provided to a member:

(a) At the time he or she receives the policy;

(b) Any time that the organization denies coverage of a service or limits coverage of a service to a member; and

2. Any time that an organization denies coverage of a service to a member, it shall notify the member in writing of:

(a) The reasons for denying the coverage of the service;

(b) The criteria by which the organization determines whether to authorize or deny coverage of the service; and

3. A written notice which is approved by the Commissioner shall be deemed to be in clear and comprehensible language that is understandable to an ordinary layperson.

(Added to NAC by Comm’r of Insurance by R132-98, eff. 3-30-99)

NAC 695D.530 Annual report: Submission; resolution of oral inquiry. (NRS 679B.130, 695D.100)

1. An organization shall submit its annual report regarding its system for resolving complaints as required pursuant to NAC 695D.540 on or before June 1 of each year. The organization shall retain a copy of the annual report for at least 3 years or until the next examination conducted by the Division, whichever is longer.

2. The organization is not required to include in the annual report information concerning an oral inquiry by a member relating to a misunderstanding or miscommunication if the misunderstanding or miscommunication was resolved within 1 working day after the inquiry was made. If the misunderstanding or miscommunication was not resolved within 1 working day, the organization shall report it as a complaint in the annual report.

(Added to NAC by Comm’r of Insurance by R132-98, eff. 3-30-99; A by R008-02, 5-23-2002)

NAC 695D.540 Annual report: Content; maintenance of records. (NRS 679B.130, 695D.100)

1. Each organization that issues a policy in this State shall submit to the Commissioner and the State Board of Health an annual report regarding its system for resolving complaints established pursuant to NAC 695D.500 on a form prescribed by the Commissioner in consultation with the State Board of Health which includes, without limitation:

(a) A description of the procedures used for resolving any complaints of a member;

(b) The total number of complaints and appeals handled through the system for resolving complaints since the last report and a compilation of the causes underlying the complaints filed;

(d) The average amount of time that was needed to resolve a complaint and an appeal, if any.

2. Each organization shall maintain records of complaints filed with it which concern something other than services and shall submit to the Commissioner a report summarizing such complaints at such times and in such format as the Commissioner may require.

(Added to NAC by Comm’r of Insurance by R132-98, eff. 3-30-99)