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<![CDATA[CHAPTER 26.1-17NONPROFIT HEALTH SERVICE CORPORATIONS26.1-17-01. Definitions. As used in this chapter, unless the context requires otherwise:1."Dental service" means the general and usual service rendered and the care<br>administered by licensed dentists.2."Health service" means service performed for and rendered to persons to restore,<br>maintain, and promote personal health, to treat injuries and cure diseases, both<br>physical and mental, by any lawful means, and includes hospital service, medical<br>service, dental service, or optometric service, or any combination of these services.<br>However, health service is limited to those services rendered by physicians,<br>surgeons, practitioners, nurses, hospitals, nursing homes, or any other provider of<br>health service who is licensed or registered under the laws of this state.3."Health service contract" means a contract which provides for the furnishing of one<br>or more kinds of health service to a subscriber.4."Health service corporation" means a nonprofit corporation organized for the<br>purposes of establishing a health service plan whereby one or more kinds of health<br>service is provided to subscribers under a prepaid health service contract entitling<br>each subscriber to certain specified health services, but does not include a health<br>maintenance organization organized under chapter 26.1-18.1.5."Hospital service" includes bed and board, general nursing care, use of the operating<br>room, use of the delivery room, ordinary medications and dressings, and other<br>customary routine care, and nursing home services and health care and related<br>services furnished by vendors of the services, but does not include the practice of<br>medicine.6."Medical service" means the general and usual services rendered and care<br>administered by physicians and oral surgeons.7."Optometric service" means the general and usual services rendered and care<br>administered by practitioners.8."Oral surgeon" means a dentist who has met all of the formal requirements to be<br>certified by the American board of oral surgery.9."Practitioner" includes an optometrist, a physician, a chiropractor, or an advanced<br>registered nurse practitioner duly licensed to practice one's profession under North<br>Dakota law.26.1-17-02.Nonprofit health service corporations authorized.A health servicecorporation must be organized under this chapter and, to the extent applicable, under chapter<br>10-33 for the purposes of establishing and putting into effect a health service plan whereby one<br>or more kinds of health service is provided to subscribers under a contract entitling each<br>subscriber to certain specified health service.Any corporation subject to this chapter is notsubject to the laws of this state relating to insurance and insurance companies, except as<br>specifically provided in such laws. This chapter applies only to corporations organized pursuant<br>to its provisions, except as specifically provided otherwise.26.1-17-03. Articles of incorporation and bylaws - Filing. The articles of incorporationof a health service corporation, and all amendments, are to be filed with the secretary of state. A<br>certified copy of the articles of incorporation and the bylaws, and all amendments, is to be filed<br>with the commissioner.Page No. 126.1-17-04.Directors - Responsibilities.A board of directors shall manage thebusiness and affairs of a health service corporation and has the power to amend bylaws. The<br>board is to consist of at least nine members. At least a majority of the directors of a health<br>service corporation writing hospital or medical service contracts under this chapter must be at all<br>times subscribers.A subscriber director is a director who is a subscriber and who is not a provider of healthcare, a person who has a material financial or fiduciary interest in the delivery of health care<br>services or a related industry, an employee of an institution that provides health care services, or<br>a spouse or a member of the immediate family of such a person. Nominations for and election of<br>the subscriber directors must be made by the existing directors.A director may serve on the board of only one corporation subject to this chapter at atime.Population factors, representation of different geographic regions, and the demography ofthe service area of the corporation subject to this chapter must be considered when making<br>nominations for the board of directors of a corporation subject to this chapter.A health service corporation may not reimburse or compensate a director for more thannecessary and actual expenses for service as a member of the board of directors.26.1-17-05. Authority of corporation writing hospital service contracts. In additionto any other powers granted by law, a health service corporation writing hospital service contracts<br>may:1.Enter into contracts for the rendering of hospital service to any of its subscribers with<br>hospitals maintained and operated by the state or any of its political subdivisions, or<br>by any corporation, limited liability company, association, or individual. The hospital<br>service plan operated by the corporation may provide for hospital service and other<br>related health services, excluding the practice of medicine, as advancements in<br>health care and treatment warrant the extension and providing of such services and<br>in case of emergency or expediency.All hospital and related health servicesprovided are subject to the approval of the health service corporation.2.Make and enter into mutual agreements with hospitals or groups of hospitals,<br>nursing homes, and other vendors and furnishers of health care services and other<br>related facilities, excluding the practice of medicine.3.Make and enter into mutual agreements with state, federal, or other governmental<br>agencies to provide hospital services, nursing home care, and other related health<br>services, excluding the practice of medicine, including health care services for the<br>needy and other persons.4.Make and enter into mutual agreements with any other health care corporation or<br>with any state or local government or agency thereof to provide health care<br>administrative services, to act as administrator of any other health care service plan,<br>or to act as a marketing agency or as a fiscal intermediary of any health care plan or<br>of any other health care organization or of any state or local government or agency.5.Enter into contracts with other corporations, including insurance companies but only<br>with prior approval of the commissioner, or other entities in this state or in other<br>states or possessions of the United States, or of Canada or other foreign countries<br>so that:a.Reciprocity of benefits may be provided to subscribers.b.Transfer of subscribers from one entity to another may be effected to conform<br>to the subscriber's place of residence.Page No. 2c.Uniform benefits may be provided for all employees and dependents of such<br>employees of entities and other organizations transacting business in this state<br>and elsewhere and a rate representing the composite experience of the areas<br>involved may be charged for such employees and their dependents.d.Health services may be provided for subscribers or policyholders of this or<br>other corporations, including insurers, or entities for the purpose of ceding or<br>accepting reinsurance or of jointly providing benefits, underwriting, pooling,<br>mutualization, equalization, and other joint undertakings which the governing<br>board may from time to time approve.26.1-17-05.1. Authority of corporation writing medical service contracts. A healthservice corporation writing medical service contracts may:1.Enter into contracts with subscribers whereby each subscriber, subscriber member,<br>officer, or employee is entitled to certain specified health services as provided in the<br>subscriber's contract.2.Enter into contracts with similar corporations within or without the state for the<br>interchange of services to those included in subscription or other similar contracts,<br>and may provide subscription contracts for the substitution of such services in lieu of<br>those therein recited.3.Enter into contracts with physicians for the rendering of medical service to<br>subscribers in accordance with the terms of the subscriber contract.4.Enter into contracts with laboratories and vendors of health appliances and<br>prostheses to provide material and services pursuant to contracts with subscribers.26.1-17-06. Authority of corporation writing optometric service contracts. A healthservice corporation writing optometric service contracts may:1.Enter into contracts with subscribers whereby each subscriber, subscriber member,<br>officer, or employee is entitled to certain specified health services as provided in the<br>subscriber's contract.2.Enter into contracts with similar corporations within or without the state for the<br>interchange of services to those included in subscription or other similar contracts,<br>and may provide subscription contracts for the substitution of such services in lieu of<br>those therein recited.3.Enter into contracts with practitioners for the rendering of optometric service to<br>subscribers in accordance with the terms of the subscriber contract.4.Enter into contracts with optical laboratories to provide material pursuant to contracts<br>with subscribers.26.1-17-07.Authority of corporation writing certain health service contracts. Ahealth service corporation writing health service contracts other than hospital service, medical<br>service, and optometric service contracts may:1.Enter into contracts with subscribers whereby each subscriber, subscriber member,<br>officer, or employee is entitled to certain specified health services as provided in the<br>subscriber's contract.2.Enter into contracts with similar corporations within or without the state for the<br>interchange of services to those included in subscription or other similar contracts,<br>and may provide subscription contracts for the substitution of such services in lieu of<br>those therein recited.Page No. 33.Enter into contracts with health service providers for the rendering of health services<br>to subscribers in accordance with the terms of the subscriber contract.4.Enter into contracts with laboratories and vendors of health appliances and<br>prostheses to provide material and services pursuant to contracts with subscribers.26.1-17-08. Corporation not authorized to practice a profession. This chapter doesnot authorize a health service corporation to engage in the practice of medicine, dentistry,<br>optometry, or any other profession for which a license or registration is required.26.1-17-09. Capital - Repayment. A health service corporation writing hospital servicecontracts or medical service contracts may not commence business and enter into any contracts<br>with subscribers, nor secure any application therefor, unless the corporation has a contributed<br>surplus of not less than one hundred thousand dollars.A health service corporation writinghealth service contracts other than hospital service or medical service contracts may not enter<br>into any contracts with any subscribers, nor secure any application therefor, unless the<br>corporation has a contributed surplus of not less than twenty-five thousand dollars.Thecontributed surplus is repayable when the unassigned earned surplus exceeds the amount<br>required to be initially paid in as contributed surplus, only if the payment does not impair the<br>working capital of the health service corporation.26.1-17-10.Nonprofit corporation tax exempt - Insurance premium tax - Lawgoverning charitable organizations applicable. Every nonprofit health service corporation is a<br>charitable and benevolent organization and is exempt from taxation by the state or any political<br>subdivision thereof, except that the tax imposed by section 26.1-03-17 is applicable to a<br>corporation subject to this chapter and the real property of a nonprofit health service corporation<br>is subject to ad valorem taxes and special assessments for special improvements. Except as<br>otherwise provided in this chapter, the laws of this state relating to and affecting nonprofit<br>charitable and benevolent corporations are applicable to all nonprofit health service corporations<br>writing health service contracts.26.1-17-11. Applicability of portion of Nonprofit Corporation Act. Unless in conflictwith this chapter, chapter 10-33 applies to the incorporation, operation, and control of any<br>nonprofit health service corporation.26.1-17-12. Contract limitations.1.Except as provided in this section, every physician, oral surgeon, dentist, or<br>practitioner licensed and registered in this state has the right to contract with any<br>health service corporation for furnishing general or special medical care, dental care,<br>or optometric care, as the case may be.A corporation may not impose anyrestriction as to the methods of diagnosis or treatment. The private relationship of<br>physician and patient, dentist and patient, or practitioner and patient is to be<br>maintained at all times and the subscriber has the right of free choice in selecting<br>any physician, oral surgeon, dentist, or practitioner.2.The governing board of a health service corporation that writes hospital or medical<br>service contracts may terminate a practitioner's participating contract, designate a<br>practitioner as nonpayable, or otherwise impose reasonable sanctions on any<br>practitioner who continues to engage in a practice pattern that is excessive or<br>inappropriate as compared to the practice pattern for the practitioner's specialty after<br>having been informed by the corporation, in writing, as to the manner in which the<br>practitioner's practice pattern is excessive or inappropriate. The corporation shall<br>consult with the practitioner and provide a reasonable time period of not less than six<br>months within which to modify the practitioner's practice pattern. If, after terminating<br>a practitioner's participating contract with the corporation, the practitioner's practice<br>pattern continues to be excessive or inappropriate, the corporation's central<br>professional services committee may consider recommending to the board that the<br>practitioner be designated nonpayable. The affected practitioner must be given thePage No. 4right to be present and to be heard by the committee which must include<br>representation of the practitioner's specialty.The board may not designate apractitioner as nonpayable in the absence of the committee's recommendation to do<br>so. All reports, data, and proceedings of the corporation relative to a practitioner<br>who is considered for designation as nonpayable is confidential, and may not be<br>disclosed or be subject to subpoena or other legal process. The corporation may<br>not pay or reimburse claims of its members relating to a treatment or service that is<br>provided by a practitioner who is designated nonpayable. Nonpayable status under<br>this section may not commence until after appropriate notification to the<br>corporation's subscribers and the affected practitioner.3.All practitioners in a group practice shall elect participating or nonparticipating status,<br>as a group, with the health service corporation. If a practitioner is designated as<br>nonparticipatingornonpayableunderthissection,theparticipatingornonparticipating status of the group is not affected. "Group practice" means a group<br>of two or more health care providers legally organized as a partnership, professional<br>corporation, or similar association.4.A health service corporation may, in its discretion, by its articles of incorporation,<br>articles of association, or bylaws, and in its contract with its subscribers, limit the<br>benefits that the corporation will furnish, and may provide for a division of benefits it<br>agrees to furnish into classes or kinds. In the absence of any limitation or division of<br>services, a corporation may provide both general and special medical and surgical,<br>dental, or optometric care benefits, including such service as may necessarily be<br>incident to such care. A corporation may, in its discretion, limit the issuance of<br>contracts as specified in its bylaws.5.A dental or optometric service contract by a health service corporation may not<br>provide the payment of any cash indemnification by the corporation to the subscriber<br>or the subscriber's estate on account of death, illness, or other injury.26.1-17-12.1.Services of registered nurses - Denial of benefits prohibited.Repealed by S.L. 1995, ch. 246, <meta property="og:url" content="https://statutes.laws.com/test/" />
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<h2>State Codes and Statutes</h2>
<a href='https://statutes.laws.com/'>Statutes</a> > <a href='https://statutes.laws.com/north-dakota'>North-dakota</a> > <a href='https://statutes.laws.com/north-dakota/t261'>T261</a> > <a href='https://statutes.laws.com/north-dakota/t261/t261c17'>T261c17</a><br><br><a href="https://law.justia.com/codes/north-dakota/2009/t261/pdf/t261c17.pdf">Download pdf</a><br><div id="embed_document" style="width:625px; height:815px; text-align:center;">Loading PDF...</div><script type="text/javascript"> var pdf_url = 'https://law.justia.com/codes/north-dakota/2009/t261/pdf/t261c17.pdf'; $(document).ready(function() { var embedwindow = $("#embed_document"); if ($.browser.msie){ embedwindow.html('<embed src="'+pdf_url+'" width="100%" height="100%"></embed>'); } else { embedwindow.html('<iframe style="width:100%; height:100%;" src="https://docs.google.com/gview?url='+window.escape(pdf_url)+'&embedded=true" frameborder="0"></iframe>'); } });</script><br><br><noframes>CHAPTER 26.1-17NONPROFIT HEALTH SERVICE CORPORATIONS26.1-17-01. Definitions. As used in this chapter, unless the context requires otherwise:1."Dental service" means the general and usual service rendered and the care<br>administered by licensed dentists.2."Health service" means service performed for and rendered to persons to restore,<br>maintain, and promote personal health, to treat injuries and cure diseases, both<br>physical and mental, by any lawful means, and includes hospital service, medical<br>service, dental service, or optometric service, or any combination of these services.<br>However, health service is limited to those services rendered by physicians,<br>surgeons, practitioners, nurses, hospitals, nursing homes, or any other provider of<br>health service who is licensed or registered under the laws of this state.3."Health service contract" means a contract which provides for the furnishing of one<br>or more kinds of health service to a subscriber.4."Health service corporation" means a nonprofit corporation organized for the<br>purposes of establishing a health service plan whereby one or more kinds of health<br>service is provided to subscribers under a prepaid health service contract entitling<br>each subscriber to certain specified health services, but does not include a health<br>maintenance organization organized under chapter 26.1-18.1.5."Hospital service" includes bed and board, general nursing care, use of the operating<br>room, use of the delivery room, ordinary medications and dressings, and other<br>customary routine care, and nursing home services and health care and related<br>services furnished by vendors of the services, but does not include the practice of<br>medicine.6."Medical service" means the general and usual services rendered and care<br>administered by physicians and oral surgeons.7."Optometric service" means the general and usual services rendered and care<br>administered by practitioners.8."Oral surgeon" means a dentist who has met all of the formal requirements to be<br>certified by the American board of oral surgery.9."Practitioner" includes an optometrist, a physician, a chiropractor, or an advanced<br>registered nurse practitioner duly licensed to practice one's profession under North<br>Dakota law.26.1-17-02.Nonprofit health service corporations authorized.A health servicecorporation must be organized under this chapter and, to the extent applicable, under chapter<br>10-33 for the purposes of establishing and putting into effect a health service plan whereby one<br>or more kinds of health service is provided to subscribers under a contract entitling each<br>subscriber to certain specified health service.Any corporation subject to this chapter is notsubject to the laws of this state relating to insurance and insurance companies, except as<br>specifically provided in such laws. This chapter applies only to corporations organized pursuant<br>to its provisions, except as specifically provided otherwise.26.1-17-03. Articles of incorporation and bylaws - Filing. The articles of incorporationof a health service corporation, and all amendments, are to be filed with the secretary of state. A<br>certified copy of the articles of incorporation and the bylaws, and all amendments, is to be filed<br>with the commissioner.Page No. 126.1-17-04.Directors - Responsibilities.A board of directors shall manage thebusiness and affairs of a health service corporation and has the power to amend bylaws. The<br>board is to consist of at least nine members. At least a majority of the directors of a health<br>service corporation writing hospital or medical service contracts under this chapter must be at all<br>times subscribers.A subscriber director is a director who is a subscriber and who is not a provider of healthcare, a person who has a material financial or fiduciary interest in the delivery of health care<br>services or a related industry, an employee of an institution that provides health care services, or<br>a spouse or a member of the immediate family of such a person. Nominations for and election of<br>the subscriber directors must be made by the existing directors.A director may serve on the board of only one corporation subject to this chapter at atime.Population factors, representation of different geographic regions, and the demography ofthe service area of the corporation subject to this chapter must be considered when making<br>nominations for the board of directors of a corporation subject to this chapter.A health service corporation may not reimburse or compensate a director for more thannecessary and actual expenses for service as a member of the board of directors.26.1-17-05. Authority of corporation writing hospital service contracts. In additionto any other powers granted by law, a health service corporation writing hospital service contracts<br>may:1.Enter into contracts for the rendering of hospital service to any of its subscribers with<br>hospitals maintained and operated by the state or any of its political subdivisions, or<br>by any corporation, limited liability company, association, or individual. The hospital<br>service plan operated by the corporation may provide for hospital service and other<br>related health services, excluding the practice of medicine, as advancements in<br>health care and treatment warrant the extension and providing of such services and<br>in case of emergency or expediency.All hospital and related health servicesprovided are subject to the approval of the health service corporation.2.Make and enter into mutual agreements with hospitals or groups of hospitals,<br>nursing homes, and other vendors and furnishers of health care services and other<br>related facilities, excluding the practice of medicine.3.Make and enter into mutual agreements with state, federal, or other governmental<br>agencies to provide hospital services, nursing home care, and other related health<br>services, excluding the practice of medicine, including health care services for the<br>needy and other persons.4.Make and enter into mutual agreements with any other health care corporation or<br>with any state or local government or agency thereof to provide health care<br>administrative services, to act as administrator of any other health care service plan,<br>or to act as a marketing agency or as a fiscal intermediary of any health care plan or<br>of any other health care organization or of any state or local government or agency.5.Enter into contracts with other corporations, including insurance companies but only<br>with prior approval of the commissioner, or other entities in this state or in other<br>states or possessions of the United States, or of Canada or other foreign countries<br>so that:a.Reciprocity of benefits may be provided to subscribers.b.Transfer of subscribers from one entity to another may be effected to conform<br>to the subscriber's place of residence.Page No. 2c.Uniform benefits may be provided for all employees and dependents of such<br>employees of entities and other organizations transacting business in this state<br>and elsewhere and a rate representing the composite experience of the areas<br>involved may be charged for such employees and their dependents.d.Health services may be provided for subscribers or policyholders of this or<br>other corporations, including insurers, or entities for the purpose of ceding or<br>accepting reinsurance or of jointly providing benefits, underwriting, pooling,<br>mutualization, equalization, and other joint undertakings which the governing<br>board may from time to time approve.26.1-17-05.1. Authority of corporation writing medical service contracts. A healthservice corporation writing medical service contracts may:1.Enter into contracts with subscribers whereby each subscriber, subscriber member,<br>officer, or employee is entitled to certain specified health services as provided in the<br>subscriber's contract.2.Enter into contracts with similar corporations within or without the state for the<br>interchange of services to those included in subscription or other similar contracts,<br>and may provide subscription contracts for the substitution of such services in lieu of<br>those therein recited.3.Enter into contracts with physicians for the rendering of medical service to<br>subscribers in accordance with the terms of the subscriber contract.4.Enter into contracts with laboratories and vendors of health appliances and<br>prostheses to provide material and services pursuant to contracts with subscribers.26.1-17-06. Authority of corporation writing optometric service contracts. A healthservice corporation writing optometric service contracts may:1.Enter into contracts with subscribers whereby each subscriber, subscriber member,<br>officer, or employee is entitled to certain specified health services as provided in the<br>subscriber's contract.2.Enter into contracts with similar corporations within or without the state for the<br>interchange of services to those included in subscription or other similar contracts,<br>and may provide subscription contracts for the substitution of such services in lieu of<br>those therein recited.3.Enter into contracts with practitioners for the rendering of optometric service to<br>subscribers in accordance with the terms of the subscriber contract.4.Enter into contracts with optical laboratories to provide material pursuant to contracts<br>with subscribers.26.1-17-07.Authority of corporation writing certain health service contracts. Ahealth service corporation writing health service contracts other than hospital service, medical<br>service, and optometric service contracts may:1.Enter into contracts with subscribers whereby each subscriber, subscriber member,<br>officer, or employee is entitled to certain specified health services as provided in the<br>subscriber's contract.2.Enter into contracts with similar corporations within or without the state for the<br>interchange of services to those included in subscription or other similar contracts,<br>and may provide subscription contracts for the substitution of such services in lieu of<br>those therein recited.Page No. 33.Enter into contracts with health service providers for the rendering of health services<br>to subscribers in accordance with the terms of the subscriber contract.4.Enter into contracts with laboratories and vendors of health appliances and<br>prostheses to provide material and services pursuant to contracts with subscribers.26.1-17-08. Corporation not authorized to practice a profession. This chapter doesnot authorize a health service corporation to engage in the practice of medicine, dentistry,<br>optometry, or any other profession for which a license or registration is required.26.1-17-09. Capital - Repayment. A health service corporation writing hospital servicecontracts or medical service contracts may not commence business and enter into any contracts<br>with subscribers, nor secure any application therefor, unless the corporation has a contributed<br>surplus of not less than one hundred thousand dollars.A health service corporation writinghealth service contracts other than hospital service or medical service contracts may not enter<br>into any contracts with any subscribers, nor secure any application therefor, unless the<br>corporation has a contributed surplus of not less than twenty-five thousand dollars.Thecontributed surplus is repayable when the unassigned earned surplus exceeds the amount<br>required to be initially paid in as contributed surplus, only if the payment does not impair the<br>working capital of the health service corporation.26.1-17-10.Nonprofit corporation tax exempt - Insurance premium tax - Lawgoverning charitable organizations applicable. Every nonprofit health service corporation is a<br>charitable and benevolent organization and is exempt from taxation by the state or any political<br>subdivision thereof, except that the tax imposed by section 26.1-03-17 is applicable to a<br>corporation subject to this chapter and the real property of a nonprofit health service corporation<br>is subject to ad valorem taxes and special assessments for special improvements. Except as<br>otherwise provided in this chapter, the laws of this state relating to and affecting nonprofit<br>charitable and benevolent corporations are applicable to all nonprofit health service corporations<br>writing health service contracts.26.1-17-11. Applicability of portion of Nonprofit Corporation Act. Unless in conflictwith this chapter, chapter 10-33 applies to the incorporation, operation, and control of any<br>nonprofit health service corporation.26.1-17-12. Contract limitations.1.Except as provided in this section, every physician, oral surgeon, dentist, or<br>practitioner licensed and registered in this state has the right to contract with any<br>health service corporation for furnishing general or special medical care, dental care,<br>or optometric care, as the case may be.A corporation may not impose anyrestriction as to the methods of diagnosis or treatment. The private relationship of<br>physician and patient, dentist and patient, or practitioner and patient is to be<br>maintained at all times and the subscriber has the right of free choice in selecting<br>any physician, oral surgeon, dentist, or practitioner.2.The governing board of a health service corporation that writes hospital or medical<br>service contracts may terminate a practitioner's participating contract, designate a<br>practitioner as nonpayable, or otherwise impose reasonable sanctions on any<br>practitioner who continues to engage in a practice pattern that is excessive or<br>inappropriate as compared to the practice pattern for the practitioner's specialty after<br>having been informed by the corporation, in writing, as to the manner in which the<br>practitioner's practice pattern is excessive or inappropriate. The corporation shall<br>consult with the practitioner and provide a reasonable time period of not less than six<br>months within which to modify the practitioner's practice pattern. If, after terminating<br>a practitioner's participating contract with the corporation, the practitioner's practice<br>pattern continues to be excessive or inappropriate, the corporation's central<br>professional services committee may consider recommending to the board that the<br>practitioner be designated nonpayable. The affected practitioner must be given thePage No. 4right to be present and to be heard by the committee which must include<br>representation of the practitioner's specialty.The board may not designate apractitioner as nonpayable in the absence of the committee's recommendation to do<br>so. All reports, data, and proceedings of the corporation relative to a practitioner<br>who is considered for designation as nonpayable is confidential, and may not be<br>disclosed or be subject to subpoena or other legal process. The corporation may<br>not pay or reimburse claims of its members relating to a treatment or service that is<br>provided by a practitioner who is designated nonpayable. Nonpayable status under<br>this section may not commence until after appropriate notification to the<br>corporation's subscribers and the affected practitioner.3.All practitioners in a group practice shall elect participating or nonparticipating status,<br>as a group, with the health service corporation. If a practitioner is designated as<br>nonparticipatingornonpayableunderthissection,theparticipatingornonparticipating status of the group is not affected. "Group practice" means a group<br>of two or more health care providers legally organized as a partnership, professional<br>corporation, or similar association.4.A health service corporation may, in its discretion, by its articles of incorporation,<br>articles of association, or bylaws, and in its contract with its subscribers, limit the<br>benefits that the corporation will furnish, and may provide for a division of benefits it<br>agrees to furnish into classes or kinds. In the absence of any limitation or division of<br>services, a corporation may provide both general and special medical and surgical,<br>dental, or optometric care benefits, including such service as may necessarily be<br>incident to such care. A corporation may, in its discretion, limit the issuance of<br>contracts as specified in its bylaws.5.A dental or optometric service contract by a health service corporation may not<br>provide the payment of any cash indemnification by the corporation to the subscriber<br>or the subscriber's estate on account of death, illness, or other injury.26.1-17-12.1.Services of registered nurses - Denial of benefits prohibited.Repealed by S.L. 1995, ch. 246, <script type="application/ld+json" class="yoast-schema-graph">{"@context":"https://schema.org","@graph":[{"@type":"WebPage","@id":"https://statutes.laws.com/test/","url":"https://statutes.laws.com/test/","name":"State Codes and Statutes - Statutes","isPartOf":{"@id":"https://statutes.laws.com/#website"},"datePublished":"2015-03-10T03:31:37+00:00","dateModified":"2019-12-27T23:25:16+00:00","breadcrumb":{"@id":"https://statutes.laws.com/test/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https://statutes.laws.com/test/"]}]},{"@type":"BreadcrumbList","@id":"https://statutes.laws.com/test/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https://statutes.laws.com/"},{"@type":"ListItem","position":2,"name":"State Codes and Statutes"}]},{"@type":"WebSite","@id":"https://statutes.laws.com/#website","url":"https://statutes.laws.com/","name":"Statutes","description":"","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https://statutes.laws.com/?s={search_term_string}"},"query-input":"required name=search_term_string"}],"inLanguage":"en-US"}]}</script>
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<h2>State Codes and Statutes</h2>
<a href='https://statutes.laws.com/'>Statutes</a> > <a href='https://statutes.laws.com/north-dakota'>North-dakota</a> > <a href='https://statutes.laws.com/north-dakota/t261'>T261</a> > <a href='https://statutes.laws.com/north-dakota/t261/t261c17'>T261c17</a><br><br><a href="https://law.justia.com/codes/north-dakota/2009/t261/pdf/t261c17.pdf">Download pdf</a><br><div id="embed_document" style="width:625px; height:815px; text-align:center;">Loading PDF...</div><script type="text/javascript"> var pdf_url = 'https://law.justia.com/codes/north-dakota/2009/t261/pdf/t261c17.pdf'; $(document).ready(function() { var embedwindow = $("#embed_document"); if ($.browser.msie){ embedwindow.html('<embed src="'+pdf_url+'" width="100%" height="100%"></embed>'); } else { embedwindow.html('<iframe style="width:100%; height:100%;" src="https://docs.google.com/gview?url='+window.escape(pdf_url)+'&embedded=true" frameborder="0"></iframe>'); } });</script><br><br><noframes>CHAPTER 26.1-17NONPROFIT HEALTH SERVICE CORPORATIONS26.1-17-01. Definitions. As used in this chapter, unless the context requires otherwise:1."Dental service" means the general and usual service rendered and the care<br>administered by licensed dentists.2."Health service" means service performed for and rendered to persons to restore,<br>maintain, and promote personal health, to treat injuries and cure diseases, both<br>physical and mental, by any lawful means, and includes hospital service, medical<br>service, dental service, or optometric service, or any combination of these services.<br>However, health service is limited to those services rendered by physicians,<br>surgeons, practitioners, nurses, hospitals, nursing homes, or any other provider of<br>health service who is licensed or registered under the laws of this state.3."Health service contract" means a contract which provides for the furnishing of one<br>or more kinds of health service to a subscriber.4."Health service corporation" means a nonprofit corporation organized for the<br>purposes of establishing a health service plan whereby one or more kinds of health<br>service is provided to subscribers under a prepaid health service contract entitling<br>each subscriber to certain specified health services, but does not include a health<br>maintenance organization organized under chapter 26.1-18.1.5."Hospital service" includes bed and board, general nursing care, use of the operating<br>room, use of the delivery room, ordinary medications and dressings, and other<br>customary routine care, and nursing home services and health care and related<br>services furnished by vendors of the services, but does not include the practice of<br>medicine.6."Medical service" means the general and usual services rendered and care<br>administered by physicians and oral surgeons.7."Optometric service" means the general and usual services rendered and care<br>administered by practitioners.8."Oral surgeon" means a dentist who has met all of the formal requirements to be<br>certified by the American board of oral surgery.9."Practitioner" includes an optometrist, a physician, a chiropractor, or an advanced<br>registered nurse practitioner duly licensed to practice one's profession under North<br>Dakota law.26.1-17-02.Nonprofit health service corporations authorized.A health servicecorporation must be organized under this chapter and, to the extent applicable, under chapter<br>10-33 for the purposes of establishing and putting into effect a health service plan whereby one<br>or more kinds of health service is provided to subscribers under a contract entitling each<br>subscriber to certain specified health service.Any corporation subject to this chapter is notsubject to the laws of this state relating to insurance and insurance companies, except as<br>specifically provided in such laws. This chapter applies only to corporations organized pursuant<br>to its provisions, except as specifically provided otherwise.26.1-17-03. Articles of incorporation and bylaws - Filing. The articles of incorporationof a health service corporation, and all amendments, are to be filed with the secretary of state. A<br>certified copy of the articles of incorporation and the bylaws, and all amendments, is to be filed<br>with the commissioner.Page No. 126.1-17-04.Directors - Responsibilities.A board of directors shall manage thebusiness and affairs of a health service corporation and has the power to amend bylaws. The<br>board is to consist of at least nine members. At least a majority of the directors of a health<br>service corporation writing hospital or medical service contracts under this chapter must be at all<br>times subscribers.A subscriber director is a director who is a subscriber and who is not a provider of healthcare, a person who has a material financial or fiduciary interest in the delivery of health care<br>services or a related industry, an employee of an institution that provides health care services, or<br>a spouse or a member of the immediate family of such a person. Nominations for and election of<br>the subscriber directors must be made by the existing directors.A director may serve on the board of only one corporation subject to this chapter at atime.Population factors, representation of different geographic regions, and the demography ofthe service area of the corporation subject to this chapter must be considered when making<br>nominations for the board of directors of a corporation subject to this chapter.A health service corporation may not reimburse or compensate a director for more thannecessary and actual expenses for service as a member of the board of directors.26.1-17-05. Authority of corporation writing hospital service contracts. In additionto any other powers granted by law, a health service corporation writing hospital service contracts<br>may:1.Enter into contracts for the rendering of hospital service to any of its subscribers with<br>hospitals maintained and operated by the state or any of its political subdivisions, or<br>by any corporation, limited liability company, association, or individual. The hospital<br>service plan operated by the corporation may provide for hospital service and other<br>related health services, excluding the practice of medicine, as advancements in<br>health care and treatment warrant the extension and providing of such services and<br>in case of emergency or expediency.All hospital and related health servicesprovided are subject to the approval of the health service corporation.2.Make and enter into mutual agreements with hospitals or groups of hospitals,<br>nursing homes, and other vendors and furnishers of health care services and other<br>related facilities, excluding the practice of medicine.3.Make and enter into mutual agreements with state, federal, or other governmental<br>agencies to provide hospital services, nursing home care, and other related health<br>services, excluding the practice of medicine, including health care services for the<br>needy and other persons.4.Make and enter into mutual agreements with any other health care corporation or<br>with any state or local government or agency thereof to provide health care<br>administrative services, to act as administrator of any other health care service plan,<br>or to act as a marketing agency or as a fiscal intermediary of any health care plan or<br>of any other health care organization or of any state or local government or agency.5.Enter into contracts with other corporations, including insurance companies but only<br>with prior approval of the commissioner, or other entities in this state or in other<br>states or possessions of the United States, or of Canada or other foreign countries<br>so that:a.Reciprocity of benefits may be provided to subscribers.b.Transfer of subscribers from one entity to another may be effected to conform<br>to the subscriber's place of residence.Page No. 2c.Uniform benefits may be provided for all employees and dependents of such<br>employees of entities and other organizations transacting business in this state<br>and elsewhere and a rate representing the composite experience of the areas<br>involved may be charged for such employees and their dependents.d.Health services may be provided for subscribers or policyholders of this or<br>other corporations, including insurers, or entities for the purpose of ceding or<br>accepting reinsurance or of jointly providing benefits, underwriting, pooling,<br>mutualization, equalization, and other joint undertakings which the governing<br>board may from time to time approve.26.1-17-05.1. Authority of corporation writing medical service contracts. A healthservice corporation writing medical service contracts may:1.Enter into contracts with subscribers whereby each subscriber, subscriber member,<br>officer, or employee is entitled to certain specified health services as provided in the<br>subscriber's contract.2.Enter into contracts with similar corporations within or without the state for the<br>interchange of services to those included in subscription or other similar contracts,<br>and may provide subscription contracts for the substitution of such services in lieu of<br>those therein recited.3.Enter into contracts with physicians for the rendering of medical service to<br>subscribers in accordance with the terms of the subscriber contract.4.Enter into contracts with laboratories and vendors of health appliances and<br>prostheses to provide material and services pursuant to contracts with subscribers.26.1-17-06. Authority of corporation writing optometric service contracts. A healthservice corporation writing optometric service contracts may:1.Enter into contracts with subscribers whereby each subscriber, subscriber member,<br>officer, or employee is entitled to certain specified health services as provided in the<br>subscriber's contract.2.Enter into contracts with similar corporations within or without the state for the<br>interchange of services to those included in subscription or other similar contracts,<br>and may provide subscription contracts for the substitution of such services in lieu of<br>those therein recited.3.Enter into contracts with practitioners for the rendering of optometric service to<br>subscribers in accordance with the terms of the subscriber contract.4.Enter into contracts with optical laboratories to provide material pursuant to contracts<br>with subscribers.26.1-17-07.Authority of corporation writing certain health service contracts. Ahealth service corporation writing health service contracts other than hospital service, medical<br>service, and optometric service contracts may:1.Enter into contracts with subscribers whereby each subscriber, subscriber member,<br>officer, or employee is entitled to certain specified health services as provided in the<br>subscriber's contract.2.Enter into contracts with similar corporations within or without the state for the<br>interchange of services to those included in subscription or other similar contracts,<br>and may provide subscription contracts for the substitution of such services in lieu of<br>those therein recited.Page No. 33.Enter into contracts with health service providers for the rendering of health services<br>to subscribers in accordance with the terms of the subscriber contract.4.Enter into contracts with laboratories and vendors of health appliances and<br>prostheses to provide material and services pursuant to contracts with subscribers.26.1-17-08. Corporation not authorized to practice a profession. This chapter doesnot authorize a health service corporation to engage in the practice of medicine, dentistry,<br>optometry, or any other profession for which a license or registration is required.26.1-17-09. Capital - Repayment. A health service corporation writing hospital servicecontracts or medical service contracts may not commence business and enter into any contracts<br>with subscribers, nor secure any application therefor, unless the corporation has a contributed<br>surplus of not less than one hundred thousand dollars.A health service corporation writinghealth service contracts other than hospital service or medical service contracts may not enter<br>into any contracts with any subscribers, nor secure any application therefor, unless the<br>corporation has a contributed surplus of not less than twenty-five thousand dollars.Thecontributed surplus is repayable when the unassigned earned surplus exceeds the amount<br>required to be initially paid in as contributed surplus, only if the payment does not impair the<br>working capital of the health service corporation.26.1-17-10.Nonprofit corporation tax exempt - Insurance premium tax - Lawgoverning charitable organizations applicable. Every nonprofit health service corporation is a<br>charitable and benevolent organization and is exempt from taxation by the state or any political<br>subdivision thereof, except that the tax imposed by section 26.1-03-17 is applicable to a<br>corporation subject to this chapter and the real property of a nonprofit health service corporation<br>is subject to ad valorem taxes and special assessments for special improvements. Except as<br>otherwise provided in this chapter, the laws of this state relating to and affecting nonprofit<br>charitable and benevolent corporations are applicable to all nonprofit health service corporations<br>writing health service contracts.26.1-17-11. Applicability of portion of Nonprofit Corporation Act. Unless in conflictwith this chapter, chapter 10-33 applies to the incorporation, operation, and control of any<br>nonprofit health service corporation.26.1-17-12. Contract limitations.1.Except as provided in this section, every physician, oral surgeon, dentist, or<br>practitioner licensed and registered in this state has the right to contract with any<br>health service corporation for furnishing general or special medical care, dental care,<br>or optometric care, as the case may be.A corporation may not impose anyrestriction as to the methods of diagnosis or treatment. The private relationship of<br>physician and patient, dentist and patient, or practitioner and patient is to be<br>maintained at all times and the subscriber has the right of free choice in selecting<br>any physician, oral surgeon, dentist, or practitioner.2.The governing board of a health service corporation that writes hospital or medical<br>service contracts may terminate a practitioner's participating contract, designate a<br>practitioner as nonpayable, or otherwise impose reasonable sanctions on any<br>practitioner who continues to engage in a practice pattern that is excessive or<br>inappropriate as compared to the practice pattern for the practitioner's specialty after<br>having been informed by the corporation, in writing, as to the manner in which the<br>practitioner's practice pattern is excessive or inappropriate. The corporation shall<br>consult with the practitioner and provide a reasonable time period of not less than six<br>months within which to modify the practitioner's practice pattern. If, after terminating<br>a practitioner's participating contract with the corporation, the practitioner's practice<br>pattern continues to be excessive or inappropriate, the corporation's central<br>professional services committee may consider recommending to the board that the<br>practitioner be designated nonpayable. The affected practitioner must be given thePage No. 4right to be present and to be heard by the committee which must include<br>representation of the practitioner's specialty.The board may not designate apractitioner as nonpayable in the absence of the committee's recommendation to do<br>so. All reports, data, and proceedings of the corporation relative to a practitioner<br>who is considered for designation as nonpayable is confidential, and may not be<br>disclosed or be subject to subpoena or other legal process. The corporation may<br>not pay or reimburse claims of its members relating to a treatment or service that is<br>provided by a practitioner who is designated nonpayable. Nonpayable status under<br>this section may not commence until after appropriate notification to the<br>corporation's subscribers and the affected practitioner.3.All practitioners in a group practice shall elect participating or nonparticipating status,<br>as a group, with the health service corporation. If a practitioner is designated as<br>nonparticipatingornonpayableunderthissection,theparticipatingornonparticipating status of the group is not affected. "Group practice" means a group<br>of two or more health care providers legally organized as a partnership, professional<br>corporation, or similar association.4.A health service corporation may, in its discretion, by its articles of incorporation,<br>articles of association, or bylaws, and in its contract with its subscribers, limit the<br>benefits that the corporation will furnish, and may provide for a division of benefits it<br>agrees to furnish into classes or kinds. In the absence of any limitation or division of<br>services, a corporation may provide both general and special medical and surgical,<br>dental, or optometric care benefits, including such service as may necessarily be<br>incident to such care. A corporation may, in its discretion, limit the issuance of<br>contracts as specified in its bylaws.5.A dental or optometric service contract by a health service corporation may not<br>provide the payment of any cash indemnification by the corporation to the subscriber<br>or the subscriber's estate on account of death, illness, or other injury.26.1-17-12.1.Services of registered nurses - Denial of benefits prohibited.Repealed by S.L. 1995, ch. 246, <!-- END .shortcode-content -->
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