(a) The department has authority to conduct examinations
of HCCs under Insurance Code §848.153. The department will conduct
examinations in conjunction with an application and as needed to oversee
the HCC's activity. The scope of the examination may vary based on
the scope of an applicant's or HCC's activities and may include desk
review. Any examination may include the review of one or more of the
following components:
(1) financial condition;
(2) quality of health care services;
(3) compliance with laws affecting the conduct of business;
or
(4) effect on market competition.
(b) The commissioner has authority under Insurance
Code §848.152(d) to set and collect fees in an amount sufficient
to pay the reasonable expenses of the department and attorney general
in administering Insurance Code Chapter 848, including direct and
indirect expenses incurred by the department, the attorney general,
and their contractors in examining and reviewing HCCs. The department
will maintain active oversight of individuals performing examination
functions to assure that the examination fee reflects expenses that
are reasonable and necessary. The examination fee will include the
actual salary, fees, and expenses of the examiners directly attributable
to the examination as follows:
(1) any actual salary amount included in an examination
fee for an examiner who is a department employee will be the part
of the annual salary attributable to each hour an examiner examines
the HCC;
(2) any expenses included in an examination fee for
an examiner who is a department employee will be actual expenses incurred
by an examiner and attributable to the examination, including the
actual cost of:
(A) transportation;
(B) lodging;
(C) meals;
(D) subsistence expenses;
(E) parking fees; and
(F) department overhead expense; and
(3) any amount included as an examination fee or expense
by an examiner who is not a department employee will be determined
according to the terms of the contract between the examiner and the
department.
(c) An HCC must pay to the department annually an assessment
as set forth in paragraphs (1) - (6) of this subsection.
(1) On or before January 31 of each year, each certified
HCC must submit to the department a statement of its gross revenues
for the previous calendar year.
(2) On or before January 31, 2014, and annually thereafter,
the department will calculate the cost by fiscal year to administer
Insurance Code Chapter 848 and this subchapter, including direct and
indirect expenses incurred by the department and the attorney general
attributable to carrying out their responsibilities under Chapter
848, but excluding examination expenses billed directly to an HCC.
(3) On or before April 1, 2014, and annually thereafter,
the department will assess all certified HCCs on a pro rata basis
for the expenses determined pursuant to paragraph (2) of this subsection,
based on the total annual gross revenues reported by the HCCs. The
assessment amount for each HCC will be adjusted by the amount of any
application fees received from the HCC.
(4) For purposes of reporting gross revenues relevant
to this subsection, an HCC may choose to reduce its gross revenues
in a clearly disclosed manner by amounts paid to individuals or entities
unaffiliated with the HCC for the following items:
(A) drugs or biological supplies that, by law, require
a prescription to be dispensed; and
(B) devices or medical supplies that, by law, require
premarket approval by or premarket notification to the Food and Drug
Administration.
(5) On receipt of an assessment pursuant to paragraph
(3) of this subsection, the HCC must pay the assessment amount before
the later of 30 days following receipt of the assessment or May 1.
(6) The department may issue additional assessments
as necessary to fully fund the expense of regulation under Insurance
Code Chapter 848 and this subchapter.
(d) When an HCC has been notified by the department
of a pending examination under this section, it may request that it
instead submit a renewal application and that the examination be converted
into a renewal review.
(1) To initiate the request, the HCC must file the
Request to Convert to Renewal of Certificate of Authority to Do the
Business of a Health Care Collaborative (HCC) in the State of Texas
form.
(2) The HCC must submit the request prior to the issuance
of any draft examination report.
(3) If the department approves the request, the HCC
must file an application for renewal within 30 days of the approval
to convert to renewal review. The application filing must comply with §13.424
of this title (relating to Certificate of Authority Renewal Requirements).
(4) The subsequent renewal date for the HCC will be
12 months following the approval date of the application to renew.
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