Health Maintenance Organizations

SECTION 27-41-21

§ 27-41-21. Penalties and enforcement.

(a) The director of business regulation may, in lieu of the suspension or revocation of a license under § 27-41-17, levy an administrative penalty in an amount not less than five hundred dollars ($500) nor more than fifty thousand dollars ($50,000), if reasonable notice in writing is given of the intent to levy the penalty and the health maintenance organization has a reasonable time in which to remedy the defect in its operations which gave rise to the penalty citation. The director of business regulation may augment this penalty by an amount equal to the sum that the director calculates to be the damages suffered by enrollees or other members of the public.

(b) Any person who violates this chapter shall be guilty of a misdemeanor and may be punished by a fine not to exceed five hundred dollars ($500) or by imprisonment for a period not exceeding one year, or both.

(c)(1) If the director of business regulation or the director of health shall for any reason have cause to believe that any violation of this chapter has occurred or is threatened, the director of business regulation or the director of health may give notice to the health maintenance organization and to their representatives, or other persons who appear to be involved in the suspected violation, to arrange a conference with the alleged violators or their authorized representatives for the purpose of attempting to ascertain the facts relating to the suspected violation, and, in the event it appears that any violation has occurred or is threatened, to arrive at an adequate and effective means of correcting or preventing the violation;

(2) Proceedings under this subsection shall be governed by chapter 35 of title 42.

(d)(1) The director of business regulation may issue an order directing a health maintenance organization or a representative of a health maintenance organization to cease and desist from engaging in any act or practice in violation of the provisions of this chapter;

(2) Within thirty (30) days after service of the order to cease and desist, the respondent may request a hearing on the question of whether acts or practices in violation of this chapter have occurred. Those hearings shall be conducted pursuant to §§ 42-35-9 – 42-35-13, and judicial review shall be available as provided by §§ 42-35-15 and 42-35-16.

(e) In the case of any violation of the provisions of this chapter, if the director of business regulation elects not to issue a cease and desist order, or in the event of noncompliance with a cease and desist order issued pursuant to subsection (d) of this section, the director of business regulation may institute a proceeding to obtain injunctive relief, or seeking other appropriate relief, in the superior court for the county of Providence.

(f) Notwithstanding any other provisions of this act, if a health maintenance organization fails to comply with the net worth, risk based capital or any other requirement of this title related to the solvency of the health maintenance organization, the director is authorized to take appropriate action to assure that the continued operation of the health maintenance organization will not be hazardous to its enrollees or the public.

History of Section.
(P.L. 1983, ch. 225, § 2; P.L. 1989, ch. 542, § 85; P.L. 2005, ch. 176, § 1.)