Senate Bill No. 64–Senator Amodei

 

February 7, 2003

____________

 

Referred to Committee on Commerce and Labor

 

SUMMARY—Authorizes formation of associations of self-insured private employers to provide health coverage. (BDR 57‑138)

 

FISCAL NOTE:  Effect on Local Government: No.

                           Effect on the State: Yes.

 

~

 

EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.

 

AN ACT relating to health insurance; authorizing the formation
of associations of self-insured private employers to provide health coverage; imposing certain requirements upon such an association and its board of trustees;
prohibiting certain acts without an agent’s license issued by the Commissioner of Insurance; authorizing the Commissioner to impose an administrative fine for certain violations; imposing certain requirements upon a third-party administrator for such an association; providing a penalty; and providing other matters properly relating thereto.

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

1-1  Section 1.  Title 57 of NRS is hereby amended by adding

1-2  thereto a new chapter to consist of the provisions set forth as

1-3  sections 2 to 43, inclusive, of this act.

1-4  Sec. 2.  As used in this chapter, unless the context otherwise

1-5  requires, the words and terms defined in sections 3 to 7, inclusive,

1-6  of this act have the meanings ascribed to them in those sections.

1-7  Sec. 3.  “Association of self-insured private employers”

1-8  means a nonprofit, unincorporated association composed of two

1-9  or more private employers that has been issued a certificate by the

1-10  Commissioner and is subject to the provisions of this chapter.

2-1  Sec. 4.  “Association’s administrator” means a person who is

2-2  employed by or has contracted with the board of trustees of an

2-3  association of self-insured private employers to carry out the

2-4  policies of the board of trustees and to be responsible for the daily

2-5  operation of the association.

2-6  Sec. 5. 1.  “Employer” means, with respect to a calendar

2-7  year, an employer who employed on business days during the

2-8  preceding calendar year an average of at least 2 employees, but

2-9  not more than 50 employees, who have a normal work week of 30

2-10  hours or more, and who employs at least 2 employees on the first

2-11  day of the year. For the purposes of determining the number of

2-12  eligible employees, organizations which are affiliated or which are

2-13  eligible to file a combined tax return for the purposes of taxation

2-14  constitute one employer.

2-15      2.  For the purposes of this section, organizations are

2-16  “affiliated” if one directly, or indirectly, through one or more

2-17  intermediaries, controls or is controlled by, or is under common

2-18  control with, the other, as determined pursuant to the provisions of

2-19  NRS 692C.050.

2-20      Sec. 6.  “Tangible net worth” means all the assets of an

2-21  association of self-insured private employers reduced by all the

2-22  liabilities of the association, but does not include:

2-23      1.  Accounts receivable, if they are factored or collateralized.

2-24      2.  An inventory, except inventory held for resale and not

2-25  collateralized.

2-26      3.  A prepaid expense.

2-27      4.  An unqualified investment.

2-28      5.  An allocated bond fund.

2-29      6.  An investment in an affiliate.

2-30      7.  A restricted fund.

2-31      8.  A reserve.

2-32      9.  A security cost, including a capitalized bond cost.

2-33      10.  A cash equivalent, unless it is described in the footnotes

2-34  for the balance sheet by item, and for investments, by duration and

2-35  nature. A cash flow statement is not a sufficient description.

2-36      11.  A contingency or commitment, including any estimated

2-37  cost.

2-38      12.  Any book adjustment caused by a change in an

2-39  accounting policy or a restatement.

2-40      13.  Goodwill or excess cost over the fair market value of

2-41  assets.

2-42      14.  Any other items listed in the assets that are deemed

2-43  unacceptable by the Commissioner because they cannot be

2-44  justified or because they do not directly support the ability of the

2-45  association or the member to pay a claim.

3-1  Sec. 7.  “Third-party administrator” means a person who

3-2  contracts with an association of self-insured private employers to

3-3  provide administrative services for the association of self-insured

3-4  private employers and to manage claims. The term does not

3-5  include an insurance company.

3-6  Sec. 8. An association of self-insured private employers may

3-7  provide health coverage for the employees of an employer that is a

3-8  member of the association only if:

3-9  1.  A portion of the premium or benefits are paid by or on

3-10  behalf of the employer;

3-11      2.  An eligible employee or his dependent is reimbursed for a

3-12  portion of the premium, whether by wage adjustments or

3-13  otherwise, by or on behalf of the employer; or

3-14      3.  The health coverage is considered by the employer or any

3-15  of his eligible employees or dependents as part of a plan or

3-16  program for the purposes of section 106, 125 or 162 of the

3-17  Internal Revenue Code, 26 U.S.C. § 106, 125 or 162.

3-18      Sec. 9.  1.  An association of self-insured private employers

3-19  may provide health coverage through a trust fund and, if

3-20  necessary, deduct contributions to the maintenance of the fund

3-21  from the compensation of officers and employees and pay the

3-22  deductions into the fund.

3-23      2.  The money must be deposited in a state or national bank or

3-24  credit union authorized to transact business in this state.

3-25      3.  Any independent administrator of a fund created pursuant

3-26  to this section is subject to the licensing requirements of chapter

3-27  683A of NRS.

3-28      4.  Any contract with an independent administrator must be

3-29  approved by the Commissioner as to the reasonableness of

3-30  administrative charges in relation to contributions collected and

3-31  benefits provided.

3-32      5.  The provisions of NRS 689B.030 to 689B.050, inclusive,

3-33  apply to coverage provided pursuant to this section.

3-34      Sec. 10.  1.  A group of two or more employers may not act

3-35  as an association of self-insured private employers unless:

3-36      (a) Each member of the group is a member or associate

3-37  member of a bona fide trade association, as determined by the

3-38  Commissioner, which:

3-39          (1) Is incorporated in this state; and

3-40          (2) Has been in existence for at least 5 years;

3-41      (b) The association of self-insured private employers has been

3-42  issued a certificate to act as such an association by the

3-43  Commissioner; and

3-44      (c) The association of self-insured private employers insures at

3-45  least 51 employees of members of the association.

4-1  2.  An association of self-insured private employers that

4-2  wishes to be issued a certificate must file with the Commissioner

4-3  an application for certification.

4-4  3.  The application must include:

4-5  (a) The name of the association.

4-6  (b) The address of:

4-7       (1) The principal office of the association; and

4-8       (2) The location where the books and records of the

4-9  association will be maintained.

4-10      (c) The date on which the association was organized.

4-11      (d) The name and address of each member of the association.

4-12      (e) The names of the initial members of the board of trustees

4-13  and the name of the initial association’s administrator.

4-14      (f) Such other information as the Commissioner may require.

4-15      4.  The application must be accompanied by:

4-16      (a) A nonrefundable filing fee of $1,000.

4-17      (b) Proof of compliance with section 11 of this act.

4-18      (c) Proof that the association or its third-party administrator is

4-19  licensed or otherwise authorized to conduct business in this state

4-20  pursuant to title 57 of NRS.

4-21      (d) A copy of the agreements entered into with the

4-22  association’s administrator and a third-party administrator.

4-23      (e) A copy of the bylaws of the association.

4-24      (f) A copy of an agreement jointly and severally binding

4-25  the association and each member of the association to secure the

4-26  provision of health coverage pursuant to the provisions of this

4-27  chapter.

4-28      (g) A pro forma financial statement prepared by an

4-29  independent certified public accountant in accordance with

4-30  generally accepted accounting principles that shows the financial

4-31  ability of the association to provide health coverage pursuant to

4-32  the provisions of this chapter.

4-33      (h) A financial statement reviewed and prepared by an

4-34  independent certified public accountant for each proposed

4-35  member of the association or evidence of the ability of the

4-36  association or its proposed members to provide a solvency bond

4-37  pursuant to subsection 3 of section 11 of this act.

4-38      (i) Proof that each member of the association will make the

4-39  initial payment to the association required pursuant to section 28

4-40  of this act on a date specified by the Commissioner. The payment

4-41  shall be deemed to be a part of the assessment required to be paid

4-42  by each member for the first year of self-insurance if certification

4-43  is issued to the association.

5-1  5.  Any financial information relating to a member of an

5-2  association received by the Commissioner pursuant to the

5-3  provisions of this section is confidential and must not be disclosed.

5-4  6.  As used in this section, “associate member of a bona

5-5  fide trade association” means a supplier whose business, as

5-6  determined by the Commissioner:

5-7  (a) Is limited to a specific industry; and

5-8  (b) Primarily involves providing a product or service that is

5-9  directly used or consumed by substantially all the members of the

5-10  trade association or bears a direct relationship to the business of

5-11  the members of the trade association.

5-12      Sec. 11.  1.  An association of self-insured private employers

5-13  shall:

5-14      (a) Execute an indemnity agreement jointly and severally

5-15  binding the association and each member of the association to

5-16  secure the provision of health coverage pursuant to this chapter.

5-17  The indemnity agreement must be in a form prescribed by

5-18  the Commissioner. An association may add provisions to the

5-19  indemnity agreement if the provisions are first approved by the

5-20  Commissioner.

5-21      (b) Except as otherwise provided in this subsection, maintain a

5-22  policy of specific and aggregate excess insurance in a form and

5-23  amount required by the Commissioner. The excess insurance must

5-24  be written by an insurer approved by the Commissioner. To

5-25  determine the amount of excess insurance required, the

5-26  Commissioner shall consider:

5-27          (1) The number of members in the association;

5-28          (2) The types of services provided by the members of the

5-29  association;

5-30          (3) The number of years the association has been in

5-31  existence; and

5-32          (4) Such other information as the Commissioner deems

5-33  necessary.

5-34  This paragraph does not prohibit an association from purchasing

5-35  secondary excess insurance in addition to the excess insurance

5-36  required by this paragraph.

5-37      (c) Collect an annual assessment from each member of the

5-38  association in an aggregate amount of at least $100,000 or in an

5-39  aggregate amount which the Commissioner determines is

5-40  satisfactory based on an annual review conducted by the

5-41  Commissioner of the actuarial solvency of the association.

5-42      (d) Except as otherwise provided in paragraph (e), deposit as

5-43  security with the Commissioner a bond executed by the association

5-44  as principal, and by a licensed surety, payable to the State of

5-45  Nevada, and conditioned upon the provision of health coverage to

6-1  employees of members of the association. The bond must be in an

6-2  amount determined by the Commissioner to be reasonably

6-3  sufficient to ensure payment of obligations related to the provision

6-4  of health coverage, but in no event may it be less than $100,000.

6-5  (e) In lieu of a bond, deposit with the Commissioner a like

6-6  amount of lawful money of the United States or any other form of

6-7  security authorized by NRS 100.065. If security is provided in the

6-8  form of a savings certificate, certificate of deposit or investment

6-9  certificate, the certificate must state that the amount is unavailable

6-10  for withdrawal except upon order of the Commissioner.

6-11      2.  Except as otherwise provided in subsection 3, in addition to

6-12  complying with the requirements of subsection 1, an association of

6-13  self-insured private employers shall maintain a combined tangible

6-14  net worth of at least $1,000,000.

6-15      3.  In lieu of complying with the requirements of subsection 2,

6-16  the association’s administrator shall ensure that a solvency bond,

6-17  in a form prescribed by the Commissioner and in an aggregate

6-18  amount of at least $1,000,000, is deposited with the Commissioner

6-19  by the association or members of the association on behalf of the

6-20  association.

6-21      4.  The association’s administrator shall deposit with the

6-22  Commissioner a bond executed by the association’s administrator

6-23  as principal, and by a licensed surety, payable to the State of

6-24  Nevada, and conditioned upon the faithful performance of his

6-25  duties. The bond must be in an amount determined by the

6-26  Commissioner.

6-27      5.  Any third-party administrator providing claims services for

6-28  the association shall deposit with the Commissioner a bond

6-29  executed by the third-party administrator as principal, and by a

6-30  licensed surety, payable to the State of Nevada, and conditioned

6-31  upon the faithful performance of its duties. The bond must be in

6-32  an amount determined by the Commissioner.

6-33      6.  The Commissioner may increase or decrease the amount of

6-34  any bond or money required to be deposited by this section in

6-35  accordance with chapter 681B of NRS and his regulations for

6-36  loss reserves in health insurance. If the Commissioner requires

6-37  an association, association’s administrator or third-party

6-38  administrator to increase its deposit, the Commissioner may

6-39  specify the form of the additional security. The association,

6-40  association’s administrator or third-party administrator shall

6-41  comply with such a requirement within 60 days after receiving

6-42  notice from the Commissioner.

6-43      7.  The Account for Health Coverage for Associations of Self-

6-44  insured Private Employers is hereby created in the State Agency

6-45  Fund for Bonds. All money received by the Commissioner

7-1  pursuant to this section must be deposited with the State Treasurer

7-2  to the credit of the Account. All claims against the Account must

7-3  be paid as other claims against the State are paid.

7-4  Sec. 12.  A surety or bonding company shall not furnish a

7-5  bond or any other form of security required by the provisions of

7-6  this chapter for an association of self-insured private employers or

7-7  a member of such an association unless the surety or bonding

7-8  company holds a certificate of authority issued by the

7-9  Commissioner.

7-10      Sec. 13.  1.  The Commissioner shall grant or deny an

7-11  application for certification as an association of self-insured

7-12  private employers within 60 days after receiving the application. If

7-13  the application is materially incomplete or does not comply with

7-14  the applicable provisions of law, the Commissioner shall notify the

7-15  applicant of the additional information or changes required.

7-16  Under such circumstances, if the Commissioner is unable to act

7-17  upon the application within this 60‑day period, he may extend the

7-18  period for granting or denying the application, but for not longer

7-19  than an additional 90 days.

7-20      2.  Upon determining that an association is qualified as an

7-21  association of self-insured private employers, the Commissioner

7-22  shall issue a certificate to that effect to the association and the

7-23  association’s administrator. No certificate may be issued to an

7-24  association that, within the 2 years immediately preceding its

7-25  application, has had its certification as an association of self-

7-26  insured private employers involuntarily withdrawn by the

7-27  Commissioner.

7-28      3.  A certificate issued pursuant to this section must include,

7-29  without limitation:

7-30      (a) The name of the association;

7-31      (b) The name of each employer that the Commissioner

7-32  determines is a member of the association at the time of the

7-33  issuance of the certificate;

7-34      (c) An identification number assigned to the association by the

7-35  Commissioner; and

7-36      (d) The date on which the certificate was issued.

7-37      4.  A certificate issued pursuant to this section remains in

7-38  effect until withdrawn by the Commissioner or canceled at the

7-39  request of the association. Coverage for an association granted a

7-40  certificate becomes effective on the date of certification or the date

7-41  specified in the certificate, as appropriate.

7-42      5.  The Commissioner shall not grant a request to cancel a

7-43  certificate unless the association has insured or reinsured all

7-44  incurred obligations with an insurer authorized to do business in

7-45  this state pursuant to an agreement filed with and approved by the

8-1  Commissioner. The agreement must include coverage for all

8-2  incurred claims, including claims that have been incurred but not

8-3  reported to the association, as well as those that have been

8-4  incurred and reported but not yet paid, and the expenses

8-5  associated with those claims.

8-6  Sec. 14.  1.  An association certified as an association of

8-7  self-insured private employers directly assumes the responsibility

8-8  for providing health coverage to the employees of the members of

8-9  the association and their beneficiaries pursuant to this chapter.

8-10      2.  The claims of employees and their beneficiaries while in

8-11  the employment of a member of an association must be handled in

8-12  the manner provided by this chapter, and the association is subject

8-13  to the regulations of the Commissioner with respect to payment of

8-14  those claims.

8-15      3.  The security deposited pursuant to section 11 of this act

8-16  does not relieve an association from responsibility for the

8-17  administration of claims and the provision of health coverage

8-18  pursuant to this chapter.

8-19      Sec. 15.  1.  An association of self-insured private employers

8-20  must be operated by a board of trustees consisting of at least five

8-21  members whom the members of the association elect for terms set

8-22  forth in the bylaws of the association. At least two-thirds of the

8-23  members of the board of trustees must be employees, officers or

8-24  directors of the members of the association. No association’s

8-25  administrator or third-party administrator employed by the

8-26  association, or any owner, officer, employee or other person

8-27  affiliated with the association’s administrator or third-party

8-28  administrator, may serve as a member of the board of trustees.

8-29  Each member of the board of trustees must be a resident of this

8-30  state or an officer of a corporation authorized to do business in

8-31  this state.

8-32      2.  The board of trustees of an association shall:

8-33      (a) Ensure the prompt payment of claims relating to the health

8-34  coverage provided pursuant to this chapter.

8-35      (b) Take such actions as are necessary to protect the assets of

8-36  the association.

8-37      (c) Employ full time an association’s administrator to carry

8-38  out the policies of the board of trustees and perform such duties as

8-39  the board delegates to him. An association’s administrator shall

8-40  not perform any of the duties assigned to a third-party

8-41  administrator.

8-42      (d) Employ a third-party administrator to carry out the duties

8-43  set forth in section 40 of this act.

9-1  (e) Employ an independent certified public accountant to

9-2  prepare the statement of financial condition required by section 24

9-3  of this act.

9-4  (f) Maintain minutes of its meetings and make the minutes

9-5  available for inspection by the Commissioner.

9-6  3.  The board of trustees of an association shall not:

9-7  (a) Extend credit to any member of the association for the

9-8  payment of the annual assessment for that member, except

9-9  pursuant to a payment plan approved by the Commissioner; or

9-10      (b) Borrow any money from the association or in the name of

9-11  the association, except in the ordinary course of its business,

9-12  without the prior approval of the Commissioner.

9-13      Sec. 16.  1.  The board of trustees of an association of self-

9-14  insured private employers is responsible for the money collected

9-15  and disbursed by the association.

9-16      2.  The board of trustees shall:

9-17      (a) Establish a claims account in a federally insured financial

9-18  institution in this state approved by the Commissioner. Except as

9-19  otherwise provided in subsection 3, at least 75 percent of the

9-20  annual assessment collected by the association from its members

9-21  must be deposited in this account to pay:

9-22          (1) Claims;

9-23          (2) Expenses related to those claims; and

9-24          (3) The costs associated with the association’s policy of

9-25  excess insurance.

9-26      (b) Establish an administrative account in a federally insured

9-27  financial institution in this state approved by the Commissioner.

9-28  The amount of the annual assessment collected by the association

9-29  that is not deposited in its claims account must be deposited in the

9-30  administrative account to pay the administrative expenses of the

9-31  association.

9-32      3.  The Commissioner may authorize an association to deposit

9-33  less than 75 percent of its annual assessment in its claims account

9-34  if the association presents evidence satisfactory to the

9-35  Commissioner that the association’s policy of excess insurance is

9-36  sufficient.

9-37      4.  The board of trustees may invest the money of the

9-38  association not needed to pay the obligations of the association

9-39  pursuant to chapter 682A of NRS.

9-40      5.  The Commissioner shall review the accounts of an

9-41  association established pursuant to this section at such times as he

9-42  deems necessary to ensure compliance with the provisions of this

9-43  section.

 

10-1      Sec. 17.  1.  An association’s administrator employed by an

10-2  association of self-insured private employers, or an employee,

10-3  officer or director of an association’s administrator, may not be an

10-4  employee, officer or director of a third-party administrator

10-5  employed by the association or have a direct or indirect financial

10-6  interest in the third-party administrator of the association.

10-7      2.  The third-party administrator of an association of self-

10-8  insured private employers, or an employee, officer or director of

10-9  the third-party administrator, may not be an employee, officer or

10-10  director of an association’s administrator employed by the

10-11  association or have a direct or indirect financial interest in that

10-12  association’s administrator.

10-13     3.  Any contract entered into by an association of self-insured

10-14  private employers and a third-party administrator must include a

10-15  provision which states that, unless the Commissioner otherwise

10-16  provides, the third-party administrator shall administer any claim

10-17  or other obligation of the association to its conclusion during the

10-18  period of the contract.

10-19     Sec. 18.  A person shall not advertise or offer for sale in this

10-20  state any policies or memberships, or solicit or receive any money,

10-21  subscriptions, applications, premiums, assessments, memberships

10-22  or any other fee or charge in connection with a proposed

10-23  association of self-insured private employers unless licensed as an

10-24  agent pursuant to chapter 683A of NRS.

10-25     Sec. 19.  1.  If an employer wishes to become a member of

10-26  an association of self-insured private employers, the employer

10-27  must:

10-28     (a) Submit an application for membership to the board of

10-29  trustees or third-party administrator of the association; and

10-30     (b) Enter into an indemnity agreement as required by section

10-31  11 of this act.

10-32     2.  The membership of the applicant becomes effective when

10-33  all members of the association have indicated their approval of the

10-34  application or on a later date specified by the association. The

10-35  application for membership and the action taken on the

10-36  application must be maintained as permanent records of the board

10-37  of trustees.

10-38     3.  Each member who is a member of an association during

10-39  the 12 months immediately following the formation of the

10-40  association must have a tangible net worth of at least $200,000.

10-41  Any employer who seeks to become a member of the association

10-42  subsequently must meet the requirement for tangible net worth of

10-43  at least $200,000 unless the Commissioner adjusts the requirement

10-44  for membership in the association after conducting an annual

11-1  review of the actuarial solvency of the association in accordance

11-2  with subsection 1 of section 11 of this act.

11-3      4.  A member of an association may terminate his membership

11-4  at any time. To terminate his membership, a member must submit

11-5  to the association’s administrator a notice of intent to withdraw

11-6  from the association at least 120 days before the effective date of

11-7  withdrawal. The association’s administrator shall, within 10 days

11-8  after receipt of the notice, notify the Commissioner of the

11-9  employer’s intent to withdraw from the association.

11-10     5.  The members of an association may cancel the

11-11  membership of any member of the association in accordance with

11-12  the bylaws of the association.

11-13     6.  The association shall:

11-14     (a) Notify the Commissioner of the termination or cancelation

11-15  of the membership of any member of the association within 10

11-16  days after the termination or cancelation; and

11-17     (b) At the expense of the member whose membership is

11-18  terminated or canceled, maintain coverage for that member for 30

11-19  days after notice is given pursuant to paragraph (a), unless the

11-20  association first receives notice from the Commissioner that the

11-21  member has:

11-22         (1) Become a member of another association of self-

11-23  insured private employers; or

11-24         (2) Become insured by an insurer.

11-25     7.  If a member of an association changes his name or form of

11-26  organization, the member remains liable for any obligations

11-27  incurred or any responsibilities imposed pursuant to this chapter

11-28  under his former name or form of organization.

11-29     8.  An association is liable for the payment of any obligations

11-30  required to be paid by a member of the association pursuant to this

11-31  chapter during his period of membership. The insolvency or

11-32  bankruptcy of a member does not relieve the association of

11-33  liability for the provision of health coverage.

11-34     Sec. 20.  An association of self-insured private employers

11-35  shall notify the Commissioner of any change in the information

11-36  submitted in its application for certification or in the manner of its

11-37  compliance with section 11 of this act not later than 30 days after

11-38  the change.

11-39     Sec. 21.  1.  The Commissioner may examine the books,

11-40  records, accounts and assets of an association of self-insured

11-41  private employers as he deems necessary to carry out the

11-42  provisions of this chapter.

11-43     2.  The expense of any examination conducted pursuant to

11-44  this section must be paid by the association.

12-1      Sec. 22.  An association of self-insured private employers

12-2  shall be deemed to have appointed the Commissioner as its

12-3  resident agent to receive any initial legal process authorized by law

12-4  to be served upon the association for as long as the association is

12-5  obligated to provide health coverage pursuant to this chapter.

12-6      Sec. 23.  1.  An association of self-insured private employers

12-7  may merge with another association of self-insured private

12-8  employers if:

12-9      (a) The members of the merging associations are engaged in

12-10  the same or similar trade;

12-11     (b) The resulting association assumes in full all obligations of

12-12  the merging associations; and

12-13     (c) The merger is approved by the Commissioner.

12-14     2.  The Commissioner shall conduct a hearing on the

12-15  proposed merger if any member of the merging associations so

12-16  requests. The Commissioner may, on his own motion, conduct

12-17  such a hearing.

12-18     Sec. 24.  1.  An association of self-insured private employers

12-19  shall file with the Commissioner an audited statement of financial

12-20  condition prepared by an independent certified public accountant.

12-21  The statement must be filed on or before April 1 of each year or, if

12-22  the fiscal year of the association does not coincide with the

12-23  calendar year, within 90 days after the conclusion of the

12-24  association’s fiscal year, and contain information for the previous

12-25  fiscal year.

12-26     2.  The statement required by subsection 1 must be in a form

12-27  prescribed by the Commissioner and include, without limitation:

12-28     (a) A statement of the reserves for:

12-29         (1) Actual claims and expenses;

12-30         (2) Claims filed with the association but not reported, and

12-31  the expenses associated with those claims;

12-32         (3) Assessments that are due, but not paid; and

12-33         (4) Unpaid debts, which must be shown as liabilities.

12-34     (b) An actuarial opinion regarding reserves that is prepared by

12-35  a member of the American Academy of Actuaries or another

12-36  specialist in loss reserves identified in the annual statement

12-37  adopted by the National Association of Insurance Commissioners.

12-38  The actuarial opinion must include a statement of:

12-39         (1) Actual claims and the expenses associated with those

12-40  claims; and

12-41         (2) Claims filed with the association but not reported, and

12-42  the expenses associated with those claims.

12-43     3.  The Commissioner may adopt a uniform financial

12-44  reporting system for associations of self-insured private employers

13-1  to ensure the accurate and complete reporting of financial

13-2  information.

13-3      4.  The Commissioner may require the filing of such other

13-4  reports as he deems necessary to carry out the provisions of this

13-5  section.

13-6      Sec. 25.  The annual assessment required to be paid by each

13-7  member of an association of self-insured private employers must

13-8  be calculated pursuant to regulations adopted by the

13-9  Commissioner.

13-10     Sec. 26.  1.  The Commissioner shall cause to be conducted

13-11  at least annually an audit of each association of self-insured

13-12  private employers to verify:

13-13     (a) The number of employees of each member of the

13-14  association;

13-15     (b) The assessment required to be paid by each member of the

13-16  association; and

13-17     (c) Any other information the Commissioner determines is

13-18  necessary.

13-19     2.  The audit required by this section must be conducted by an

13-20  auditor approved by the Commissioner.

13-21     3.  A report of the audit must be filed with the Commissioner

13-22  in a form required by the Commissioner.

13-23     4.  The expenses of any audit conducted pursuant to this

13-24  section must be paid by the association.

13-25     Sec. 27.  1.  If the assets of an association of self-insured

13-26  private employers exceed the amount necessary for the association

13-27  to:

13-28     (a) Pay its obligations and administrative expenses;

13-29     (b) Carry reasonable reserves; and

13-30     (c) Provide for contingencies,

13-31  the board of trustees of the association may, after obtaining the

13-32  approval of the Commissioner, declare and distribute dividends to

13-33  the members of the association.

13-34     2.  Any dividend declared pursuant to subsection 1 must be

13-35  distributed not less than 12 months after the end of the fiscal year.

13-36     3.  A dividend may be paid only to those members who are

13-37  members of the association for the entire fiscal year. The payment

13-38  of a dividend must not be conditioned upon the member

13-39  continuing his membership in the association after the fiscal year.

13-40     4.  An association shall give to each prospective member of

13-41  the association a written description of its plan for distributing

13-42  dividends when the prospective member applies for membership in

13-43  the association.

 

14-1      Sec. 28.  1.  Each association of self-insured private

14-2  employers shall adopt a plan for the payment of annual

14-3  assessments by the members of the association which must be

14-4  approved by the Commissioner.

14-5      2.  The plan must include a requirement for:

14-6      (a) An initial payment, in advance, of a portion of the annual

14-7  assessment due from each member of the association. The initial

14-8  payment must be in an amount equal to at least 25 percent of the

14-9  member’s annual assessment.

14-10     (b) Payment of the balance of the annual assessment due in

14-11  quarterly or monthly installments.

14-12     Sec. 29.  Each association of self-insured private employers

14-13  shall maintain:

14-14     1.  Actuarially appropriate loss reserves. The reserves must

14-15  include reserves for:

14-16     (a) Actual claims and the expenses associated with those

14-17  claims; and

14-18     (b) Claims filed with the association but not reported, and the

14-19  expenses associated with those claims.

14-20     2.  Reserves for uncollected debts.

14-21     Sec. 30.  1.  If the assets of an association of self-insured

14-22  private employers are insufficient to make certain the prompt

14-23  payment of claims relating to the health coverage provided

14-24  pursuant to this chapter and to maintain the reserves required by

14-25  section 29 of this act, the association shall immediately notify the

14-26  Commissioner of the deficiency and:

14-27     (a) Transfer any surplus acquired from a previous fiscal year

14-28  to the current fiscal year to make up the deficiency;

14-29     (b) Transfer money from its administrative account to its

14-30  claims account;

14-31     (c) Collect an additional assessment from its members in an

14-32  amount required to make up the deficiency; or

14-33     (d) Take any other action to make up the deficiency which is

14-34  approved by the Commissioner.

14-35     2.  If the association wishes to transfer any surplus from one

14-36  fiscal year to another, the association must first notify the

14-37  Commissioner of the transfer.

14-38     3.  The Commissioner shall order the association to make up

14-39  any deficiency pursuant to subsection 1 if the association fails to

14-40  do so within 30 days after notifying the Commissioner of the

14-41  deficiency. The association shall be deemed insolvent if it fails to:

14-42     (a) Collect an additional assessment from its members within

14-43  30 days after being ordered to do so by the Commissioner; or

14-44     (b) Make up the deficiency in any other manner within 60 days

14-45  after being ordered to do so by the Commissioner.

15-1      Sec. 31.  1.  The Commissioner may issue an order requiring

15-2  an association of self-insured private employers or a member of

15-3  the association to cease and desist from engaging in any act or

15-4  practice found to be in violation of any provision of this chapter or

15-5  any regulation adopted pursuant to this chapter.

15-6      2.  If the Commissioner determines that an association or a

15-7  member of the association has violated an order to cease and

15-8  desist, the Commissioner may impose an administrative fine of not

15-9  more than $10,000 for each violation of the order, not to exceed

15-10  an aggregate amount of $100,000, or withdraw the certificate of

15-11  the association, or both.

15-12     Sec. 32.  1.  The Commissioner may impose an

15-13  administrative fine for each violation of any provision of this

15-14  chapter or any regulation adopted pursuant to this chapter. Except

15-15  as otherwise provided in this chapter, the amount of the fine may

15-16  not exceed $1,000 for each violation or an aggregate amount of

15-17  $10,000.

15-18     2.  The Commissioner may withdraw the certificate of an

15-19  association of self-insured private employers if:

15-20     (a) The certificate was obtained by fraud;

15-21     (b) The application for certification contained a material

15-22  misrepresentation;

15-23     (c) The association is found to be insolvent;

15-24     (d) The association fails to have two or more members;

15-25     (e) The association fails to pay the costs of any examination or

15-26  any penalty, fee or assessment required by the provisions of this

15-27  chapter;

15-28     (f) The association fails to comply with any of the provisions of

15-29  this chapter or any regulation adopted pursuant to this chapter;

15-30     (g) The association fails to comply with any order of the

15-31  Commissioner within the time prescribed by the provisions of this

15-32  chapter or in the order of the Commissioner;

15-33     (h) The association or its third-party administrator

15-34  misappropriates, converts, illegally withholds or refuses to pay any

15-35  money to which a person is entitled and that was entrusted to the

15-36  association in its fiduciary capacity; or

15-37     (i) The association markets or operates in another state

15-38  without being licensed or certified in that state to do so.

15-39     3.  If the Commissioner withdraws the certification of an

15-40  association of self-insured private employers, each employer who

15-41  is a member of the association remains liable for his obligations

15-42  incurred before and after the order of withdrawal.

15-43     Sec. 33.  1.  Before any action may be taken pursuant to

15-44  subsection 2, the Commissioner shall arrange an informal

15-45  meeting with an association of self-insured private employers to

16-1  discuss and seek correction of any conduct which would be

16-2  grounds for withdrawal of the certificate of the association.

16-3      2.  Except as otherwise provided in subsection 3, before the

16-4  Commissioner may withdraw the certificate of any association of

16-5  self-insured private employers, the Commissioner must give

16-6  written notice to the association by certified mail that its certificate

16-7  will be withdrawn 10 days after receipt of the notice unless, within

16-8  that time, the association corrects the conduct set forth in the

16-9  notice as the reason for the withdrawal or submits a written

16-10  request for a hearing to the Commissioner.

16-11     3.  The Commissioner may grant additional time, not to

16-12  exceed an additional 120 days, before the withdrawal of the

16-13  certificate of an association if:

16-14     (a) The grounds for withdrawal of the certificate of the

16-15  association are based on paragraph (d) of subsection 2 of section

16-16  32 of this act; and

16-17     (b) The association is financially sound and capable of

16-18  fulfilling its commitments.

16-19     4.  If the association requests a hearing:

16-20     (a) The Commissioner shall set a date for a hearing within 20

16-21  days after receiving the request and give the association at least 10

16-22  business days’ notice of the time and place of the hearing.

16-23     (b) A record of the hearing must be kept, but it need not be

16-24  transcribed unless requested by the association with the cost of

16-25  transcription to be charged to the association.

16-26     (c) Within 5 business days after the hearing, the Commissioner

16-27  shall affirm or disaffirm the withdrawal of the certificate of the

16-28  association and give the association written notice thereof by

16-29  certified mail. If withdrawal of certification is affirmed, the

16-30  withdrawal becomes effective 10 business days after the

16-31  association receives notice of the affirmance, unless within that

16-32  period, the association corrects the conduct which was grounds for

16-33  the withdrawal or petitions for judicial review of the affirmance.

16-34     5.  If the withdrawal of certification is affirmed following

16-35  judicial review, the withdrawal becomes effective 5 days after entry

16-36  of the final decree of affirmance.

16-37     Sec. 34.  1.  If for any reason the status of an association of

16-38  self-insured private employers as an association of self-insured

16-39  employers is terminated, the security deposited pursuant to section

16-40  11 of this act must remain on deposit for at least 36 months in

16-41  such an amount as is necessary to secure the outstanding and

16-42  contingent liability arising from the provision of health coverage

16-43  secured by the security.

16-44     2.  At the expiration of the 36-month period, or such other

16-45  period as the Commissioner deems proper, the Commissioner may

17-1  accept in lieu of any security so deposited a policy of paid-up

17-2  insurance in a form approved by the Commissioner.

17-3      Sec. 35.  Any association of self-insured private employers

17-4  that is aggrieved by a decision of the Commissioner may petition

17-5  for judicial review in the manner provided by chapter 233B of

17-6  NRS.

17-7      Sec. 36.  1.  For the purposes of this chapter, an association

17-8  of self-insured private employers is insolvent if it is unable to pay

17-9  its outstanding obligations as they mature in the regular course of

17-10  its business.

17-11     2.  A licensed surety providing a surety bond pursuant to

17-12  section 11 of this act may terminate liability on its surety bond by

17-13  giving the Commissioner and the association, association’s

17-14  administrator or third-party administrator 90 days’ written notice.

17-15  The termination does not limit liability that was incurred under

17-16  the surety bond before the termination. If the association fails to

17-17  requalify as an association of self-insured private employers on or

17-18  before the termination date, the association’s certificate is

17-19  withdrawn when the termination becomes effective.

17-20     Sec. 37.  1.  The Commissioner may assess all associations

17-21  of self-insured private employers to provide for claims against any

17-22  insolvent association.

17-23     2.  All money received from such assessments must be

17-24  deposited with the State Treasurer to the credit of the Account for

17-25  Insolvent Associations of Self-insured Private Employers, which is

17-26  hereby created in the Fund for Self-insured Providers of Health

17-27  Coverage, which is hereby created in the State Treasury as a

17-28  special revenue fund. Money in the Account must be used solely to

17-29  carry out the provisions of this section. All claims against the

17-30  Account must be paid as other claims against the State are paid.

17-31  The State Treasurer shall invest money in the Account in the same

17-32  manner and in the same securities in which he may invest money

17-33  in the State General Fund. Income realized from the investment of

17-34  the money in the Account must be credited to the Account.

17-35     Sec. 38.  The Commissioner may adopt such regulations as

17-36  are necessary to carry out the provisions of this chapter.

17-37     Sec. 39.  1.  An association of self-insured private employers

17-38  may enter into a contract to have its plan of health coverage

17-39  administered by a third-party administrator.

17-40     2.  An association shall not enter into a contract with any

17-41  person for the administration of any part of the plan of health

17-42  coverage unless that person maintains an office in this state

17-43  and has a certificate issued by the Commissioner pursuant to

17-44  NRS 683A.085.

18-1      Sec. 40.  1.  A person shall not act as a third-party

18-2  administrator for an association of self-insured private employers

18-3  pursuant to this chapter without first obtaining a certificate issued

18-4  by the Commissioner pursuant to NRS 683A.085.

18-5      2.  A person who acts as a third-party administrator pursuant

18-6  to this chapter shall:

18-7      (a) Administer from one or more offices located in this state all

18-8  the claims arising under each plan of health coverage that he

18-9  administers and maintain in those offices all the records

18-10  concerning those claims;

18-11     (b) Administer each plan of health coverage directly, without

18-12  subcontracting with another third-party administrator; and

18-13     (c) Upon the termination of his contract with an association,

18-14  transfer forthwith to a certified third-party administrator chosen

18-15  by the association all the records in his possession concerning

18-16  claims arising under the plan of health coverage.

18-17     3.  The Commissioner may, under exceptional circumstances,

18-18  waive the requirements of subsection 2.

18-19     Sec. 41.  The Commissioner shall impose an administrative

18-20  fine of not more than $1,000 against a third-party administrator

18-21  for each violation and may withdraw the certification of a third-

18-22  party administrator who:

18-23     1.  Fails to comply with any regulation adopted by the

18-24  Commissioner regarding reports or other requirements necessary

18-25  to carry out the purposes of this chapter; or

18-26     2.  Violates any provision of section 40 of this act or any

18-27  regulation adopted by the Commissioner concerning the

18-28  administration of the plan of health coverage.

18-29     Sec. 42.  1.  The Commissioner may adopt regulations to

18-30  define when an association of self-insured private employers is

18-31  considered to be in a hazardous financial condition and to

18-32  establish the standards to be considered by the Commissioner in

18-33  determining whether the continued operation of an association of

18-34  self-insured private employers transacting business in this state

18-35  may be considered to be hazardous to its members or creditors or

18-36  to the general public.

18-37     2.  If the Commissioner determines after a hearing that any

18-38  association of self-insured private employers is in a hazardous

18-39  financial condition, he may, in lieu of suspending or revoking the

18-40  certificate of the association of self-insured private employers,

18-41  limit the association’s certificate as he deems necessary to correct,

18-42  eliminate or remedy any conduct, condition or ground that is

18-43  deemed to be a cause of the hazardous financial condition.

18-44     3.  An order or decision issued by the Commissioner pursuant

18-45  to this section is subject to review in accordance with NRS

19-1  679B.310 to 679B.370, inclusive, at the request of any party to the

19-2  proceedings whose interests are substantially affected.

19-3      Sec. 43.  1.  An association of self-insured private employers

19-4  is subject to the provisions of this chapter and, to the extent

19-5  applicable:

19-6      (a) Chapter 679B of NRS.

19-7      (b) Chapter 686A of NRS.

19-8      (c) The provisions of NRS 689B.0285, 689B.061 to 689B.069,

19-9  inclusive, and 689B.245 to 689B.330, inclusive.

19-10     (d) The provisions of NRS 689C.107, 689C.109, 689C.111,

19-11  689C.156, 689C.1565, 689C.158 to 689C.207, inclusive, 689C.265,

19-12  689C.310, 689C.320 and 689C.355.

19-13     (e) Chapter 696B of NRS.

19-14     2.  For the purposes of this section, unless the context

19-15  otherwise requires, any reference in a section of NRS included in

19-16  paragraphs (a) to (e), inclusive, of subsection 1 to:

19-17     (a) “Health benefit plan,” “policy of group health insurance”

19-18  or “policy of group insurance” must be replaced by “health

19-19  coverage provided by an association of self-insured private

19-20  employers”;

19-21     (b) “Insurer” or “carrier” must be replaced by “association of

19-22  self-insured private employers”;

19-23     (c) “Producer” must be replaced by “agent licensed pursuant

19-24  to chapter 683A of NRS”; and

19-25     (d) “Small employer” must be replaced by “employer.”

19-26     Sec. 44.  NRS 232.550 is hereby amended to read as follows:

19-27     232.550  As used in NRS 232.550 to 232.700, inclusive, unless

19-28  the context otherwise requires:

19-29     1.  “Administrator” means the Administrator of the Division.

19-30     2.  “Director” means the Director of the Department of

19-31  Business and Industry.

19-32     3.  “Division” means the Division of Industrial Relations of the

19-33  Department of Business and Industry.

19-34     4.  “Insurer” includes:

19-35     (a) A self-insured employer;

19-36     (b) An association of self-insured public employers[;] as

19-37  defined in NRS 616A.055;

19-38     (c) An association of self-insured private employers[;] as

19-39  defined in NRS 616A.050; and

19-40     (d) A private carrier.

19-41     Sec. 45.  NRS 244.33505 is hereby amended to read as

19-42  follows:

19-43     244.33505  1.  In a county in which a license to engage in a

19-44  business is required, the board of county commissioners shall not

20-1  issue such a license unless the applicant for the license signs an

20-2  affidavit affirming that the business:

20-3      (a) Has received coverage by a private carrier as required

20-4  pursuant to chapters 616A to 616D, inclusive, and chapter 617 of

20-5  NRS;

20-6      (b) Maintains a valid certificate of self-insurance pursuant to

20-7  chapters 616A to 616D, inclusive, of NRS;

20-8      (c) Is a member of an association of self-insured public or

20-9  private employers; or

20-10     (d) Is not subject to the provisions of chapters 616A to 616D,

20-11  inclusive, or chapter 617 of NRS.

20-12     2.  In a county in which such a license is not required, the board

20-13  of county commissioners shall require a business, when applying for

20-14  a post office box, to submit to the board the affidavit required by

20-15  subsection 1.

20-16     3.  Each board of county commissioners shall submit to the

20-17  Administrator of the Division of Industrial Relations of the

20-18  Department of Business and Industry monthly a list of the names of

20-19  those businesses which have submitted an affidavit required by

20-20  subsections 1 and 2.

20-21     4.  Upon receiving an affidavit required by this section, a board

20-22  of county commissioners shall provide the owner of the business

20-23  with a document setting forth the rights and responsibilities of

20-24  employers and employees to promote safety in the workplace, in

20-25  accordance with regulations adopted by the Division of Industrial

20-26  Relations of the Department of Business and Industry pursuant to

20-27  NRS 618.376.

20-28     5.  As used in this section:

20-29     (a) “Association of self-insured private employers” has the

20-30  meaning ascribed to it in NRS 616A.050.

20-31     (b) “Association of self-insured public employers” has the

20-32  meaning ascribed to it in NRS 616A.055.

20-33     Sec. 46.  NRS 268.0955 is hereby amended to read as follows:

20-34     268.0955  1.  In an incorporated city in which a license to

20-35  engage in a business is required, the city council or other governing

20-36  body of the city shall not issue such a license unless the applicant

20-37  for the license signs an affidavit affirming that the business:

20-38     (a) Has received coverage by a private carrier as required

20-39  pursuant to chapters 616A to 616D, inclusive, and chapter 617 of

20-40  NRS;

20-41     (b) Maintains a valid certificate of self-insurance pursuant to

20-42  chapters 616A to 616D, inclusive, of NRS;

20-43     (c) Is a member of an association of self-insured public or

20-44  private employers; or

21-1      (d) Is not subject to the provisions of chapters 616A to 616D,

21-2  inclusive, or chapter 617 of NRS.

21-3      2.  In an incorporated city in which such a license is not

21-4  required, the city council or other governing body of the city shall

21-5  require a business, when applying for a post office box, to submit to

21-6  the governing body the affidavit required by subsection 1.

21-7      3.  Each city council or other governing body of an

21-8  incorporated city shall submit to the Administrator of the Division

21-9  of Industrial Relations of the Department of Business and Industry

21-10  monthly a list of the names of those businesses which have

21-11  submitted an affidavit required by subsections 1 and 2.

21-12     4.  Upon receiving an affidavit required by this section, the city

21-13  council or other governing body of an incorporated city shall

21-14  provide the applicant with a document setting forth the rights and

21-15  responsibilities of employers and employees to promote safety in the

21-16  workplace in accordance with regulations adopted by the Division

21-17  of Industrial Relations of the Department of Business and Industry

21-18  pursuant to NRS 618.376.

21-19     5.  As used in this section:

21-20     (a) “Association of self-insured private employers” has the

21-21  meaning ascribed to it in NRS 616A.050.

21-22     (b) “Association of self-insured public employers” has the

21-23  meaning ascribed to it in NRS 616A.055.

21-24     Sec. 47.  NRS 281.153 is hereby amended to read as follows:

21-25     281.153  1.  The employer of a police officer or fireman may

21-26  establish a program that allows a police officer or fireman whom it

21-27  employs who has suffered a catastrophe resulting in temporary total

21-28  disability to elect to continue to receive his normal salary for a

21-29  period of not more than 1 year in lieu of receiving the compensation

21-30  for the industrial injury or occupational disease for which he is

21-31  eligible pursuant to chapters 616A to 616D, inclusive, or 617 of

21-32  NRS, unless the police officer or fireman has made an election

21-33  pursuant to NRS 281.390.

21-34     2.  A program established pursuant to subsection 1:

21-35     (a) Must prescribe the conditions pursuant to which a police

21-36  officer or fireman is eligible to receive his normal salary in

21-37  accordance with an election pursuant to subsection 1; and

21-38     (b) May allow a police officer or fireman to return to light-duty

21-39  employment or employment modified according to his physical

21-40  restrictions or limitations and receive his normal salary during the

21-41  period of his election pursuant to subsection 1.

21-42     3.  Unless the employer is self-insured or a member of an

21-43  association of self-insured public or private employers, the employer

21-44  shall notify the insurer that provides industrial insurance for that

21-45  employer of the election by a police officer or fireman pursuant to

22-1  subsection 1. When the police officer or fireman is no longer

22-2  eligible to receive his normal salary pursuant to such an election, the

22-3  employer shall notify the insurer so that the insurer may begin

22-4  paying to the police officer or fireman the benefits, if any, for

22-5  industrial insurance for which the police officer or fireman is

22-6  eligible. If the employer is self-insured or a member of such an

22-7  association of self-insured public or private employers and the

22-8  police officer or fireman is no longer eligible to receive his normal

22-9  salary in accordance with an election pursuant to subsection 1, the

22-10  employer shall begin paying the benefits, if any, for industrial

22-11  insurance to which the police officer or fireman is entitled.

22-12     4.  During the period in which the police officer or fireman

22-13  elects to receive his normal salary pursuant to subsection 1, he

22-14  accrues sick leave, annual leave and retirement benefits at the same

22-15  rate at which he accrued such leave and benefits immediately before

22-16  the election.

22-17     5.  As used in this section:

22-18     (a) “Association of self-insured private employers” has the

22-19  meaning ascribed to it in NRS 616A.050.

22-20     (b) “Association of self-insured public employers” has the

22-21  meaning ascribed to it in NRS 616A.055.

22-22     (c) “Catastrophe” means an illness or accident arising out of or

22-23  in the course of employment which is life threatening or which will

22-24  require a period of convalescence that an attending physician

22-25  expects to exceed 30 days and because of which the employee is

22-26  unable to perform the duties of his position.

22-27     [(b)] (d) “Police officer” has the meaning ascribed to it in

22-28  NRS 617.135.

22-29     Sec. 48.  NRS 624.256 is hereby amended to read as follows:

22-30     624.256  1.  Before granting an original or renewal of a

22-31  contractor’s license to any applicant, the Board shall require that the

22-32  applicant submit to the Board:

22-33     (a) Proof of industrial insurance and insurance for occupational

22-34  diseases which covers his employees;

22-35     (b) A copy of his certificate of qualification as a self-insured

22-36  employer which was issued by the Commissioner of Insurance;

22-37     (c) If the applicant is a member of an association of self-insured

22-38  public or private employers, a copy of the certificate issued to the

22-39  association by the Commissioner of Insurance; or

22-40     (d) An affidavit signed by the applicant affirming that he is not

22-41  subject to the provisions of chapters 616A to 616D, inclusive, or

22-42  chapter 617 of NRS because:

22-43         (1) He has no employees;

22-44         (2) He is not or does not intend to be a subcontractor for a

22-45  principal contractor; and

23-1          (3) He has not or does not intend to submit a bid on a job for

23-2  a principal contractor or subcontractor.

23-3      2.  The Board shall notify the Fraud Control Unit for Industrial

23-4  Insurance established pursuant to NRS 228.420 whenever the Board

23-5  learns that an applicant or holder of a contractor’s license has

23-6  engaged in business as or acted in the capacity of a contractor within

23-7  this state without having obtained industrial insurance or insurance

23-8  for occupational diseases in violation of the provisions of chapters

23-9  616A to 617, inclusive, of NRS.

23-10     3.  As used in this section:

23-11     (a) “Association of self-insured private employers” has the

23-12  meaning ascribed to it in NRS 616A.050.

23-13     (b) “Association of self-insured public employers” has the

23-14  meaning ascribed to it in NRS 616A.055.

23-15     Sec. 49.  1.  The Commissioner of Insurance of the

23-16  Department of Business and Industry shall award certificates to not

23-17  more than three associations of self-insured private employers on or

23-18  before January 1, 2005. Not more than two such associations may be

23-19  formed in Clark County and not more than one in northern Nevada.

23-20  The Commissioner shall award the certificates in the order in which

23-21  associations satisfy all the requirements for certification.

23-22     2.  On or before February 1, 2005, the Commissioner shall

23-23  submit to the Director of the Legislative Counsel Bureau for

23-24  transmittal to the 73rd session of the Nevada Legislature a report on

23-25  the effectiveness and safety of associations of self-insured private

23-26  employers in providing health coverage to employees of certain

23-27  small employers.

23-28     3.  The Commissioner shall not suspend or revoke the

23-29  certificate of an association of self-insured private employers

23-30  awarded a certificate pursuant to sections 2 to 43, inclusive, of this

23-31  act so long as the association complies with all the provisions of

23-32  sections 2 to 43, inclusive, of this act and any regulations adopted

23-33  by the Commissioner pursuant thereto.

23-34     Sec. 50.  This act becomes effective on July 1, 2003.

 

23-35  H