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May 24, 2024 Clear | 73°F
The 193rd General Court of the Commonwealth of Massachusetts

Section 20A: Administrative supervision, rehabilitation or liquidation of health maintenance organizations; revocation or suspension of license

Section 20A. If the commissioner is satisfied, upon examination or other evidence submitted to him, that (1) any health maintenance organization is insolvent or is in an unsound financial condition, (2) its business policies or methods are unsound or improper, (3) its condition or management is such as to render its further transaction of business hazardous to the public or its members or creditors, (4) it is transacting business fraudulently, (5) the health maintenance organization or its officers or agents have refused to submit to an examination under section 10 or to perform any legal obligation relative thereto, (6) the amount of its funds, net cash or contingent assets is deficient, (7) the health maintenance organization has attempted or is attempting to compromise with its creditors on the ground that it is financially unable to pay its claims in full, or (8) the health maintenance organization has inadequately reserved for unearned premiums, he may seek administrative supervision, rehabilitation or liquidation pursuant to section 20 or revoke or suspend the license issued to the health maintenance organization under section 14 for a period not exceeding the unexpired terms thereof.

In the case of revocation or suspension, the commissioner shall give written notice to the company specifying the date on which such revocation or suspension shall be effective, the term of any such suspension and the ground for such revocation or suspension; provided, that if the ground for revocation or suspension is that the health maintenance organization has violated any provision of law or has failed to comply with its charter, the effective date of such revocation or suspension shall be not less than 10 days from the date of issue of the notice, and the particulars of such violation or failure to comply with its charter shall be specified in said notice. Such notice may be served by registered mail, sent postage prepaid, addressed to the health maintenance organization at its last home office address or to the last known address of the resident agent. An affidavit of the commissioner, in such form as he may prescribe, or of anyone authorized by him to give such notice, appended to a copy thereof, that such notice has been mailed as aforesaid shall be prima facie evidence that such notice has been duly given. He shall also cause notice of such revocation or suspension to be published in such manner as he may deem necessary for the protection of the public. A health maintenance organization aggrieved by a revocation or suspension of its license under this section, may within 10 days from the effective date of such revocation or suspension file a petition in the supreme judicial court for the county of Suffolk for a review of such action of the commissioner. The court shall summarily hear and determine the question whether the ground for revocation or suspension specified in the notice of the commissioner exists and may make any appropriate order or decree. If the order or decree is adverse to the petitioning health maintenance organization it may within 10 days therefrom appeal to the full court and in case of such an appeal the revocation or suspension of the license of the health maintenance organization shall continue in full force until the final determination of the question by the full court, unless vacated by the commissioner during the pendency of such appeal.