§ 152.3. Content of an application for approval.
(a) The application for approval of a risk-assuming preferred provider organization, which is not a licensed insurer, includes:
(1) A copy of the basic organizational document of the applicant preferred provider organization, such as the articles of incorporation, and amendments thereto.
(2) A copy of the bylaws, rules or similar documents regulating the conduct of the internal affairs of the applicant preferred provider organization.
(3) A list of the names, addresses and official positions of members of the board of directors of the applicant preferred provider organization and of persons who are responsible for the conduct of the affairs of the applicant, including, but not limited to, the chief executive officer, chief operating officer, director of marketing, medical director and director of finance.
(4) A copy of the preferred provider organization’s most recent financial statement.
(5) An organization chart describing the relationship between the preferred provider organization and its affiliates, including the state of domicile and the primary business of each entity.
(6) A description of the proposed service area of the provider organization, including geographic boundaries.
(7) A financial analysis prepared for the purpose of determining that the proposed preferred provider organization will have adequate working capital and reserves. The analysis shall include a feasibility study, a business plan with projected financial statements for the next 3 years, a review of proposed provider and physician contracts and charges, a review of proposed rates and a market opportunity analysis. The financial analysis shall be made under the direction of a qualified actuary or certified public accountant.
(8) A copy of every standard form contract with physicians and providers establishing preferred provider arrangements.
(9) A detailed description of the types of financial incentives for preferred physicians and providers within the preferred provider arrangements.
(10) A list of the preferred providers.
(11) A copy of procedures, if any, for referral of covered persons to nonpreferred providers by the preferred provider organization or a preferred provider.
(12) A detailed description of the preferred provider organization’s provisions to prevent undertreatment or poor quality care of persons covered by the preferred provider arrangements. Standards regarding the adequacy of a quality assurance system are provided in § 152.4 (relating to scope of Department of Health review of a preferred provider organization).
(13) A copy of every standard form contract with health care insurers and purchasers through which preferred provider arrangements are made available to covered persons.
(14) A copy of every standard form contract with enrollees or groups of enrollees setting forth the preferred provider organization’s contractual obligations to provide, arrange for the provision of or pay for covered health care services.
(15) A description of the incentives for enrollees to use the services of a preferred provider contained within the preferred provider organization’s enrollee contracts.
(16) A copy of the preferred provider organization’s enrollee literature.
(17) A description of provisions within the preferred provider arrangements holding covered person financially harmless for payment denials by the preferred provider organizations for improper utilization of covered health services caused by preferred providers.
(18) A copy of charges made to health care insurers, purchasers or covered persons by the preferred provider organization in consideration for establishment of the preferred provider arrangements.
(19) Other information that the applicant preferred provider organization may wish to submit which reasonably relates to its ability to establish, operate, maintain or underwrite a preferred provider organization.
(b) The application for approval of a risk-assuming preferred provider organization which is a licensed insurer includes the items listed in subsection (a)(6) and (8)—(19).
(c) The application for approval of a preferred provider organization which does not assume financial risk includes the items listed in subsection (a)(6), (8)—(11), (13)—(16) and (19).
(d) The application for approval of a preferred provider organization which is governed and regulated under the Employee Retirement Income Security Act of 1974 (29 U.S.C.A. § § 301—309 and 1001—1461) will consist of the certificate required by § 152.12 (relating to provider organizations governed and regulated under ERISA).
(e) Changes or additions, or both, to the information in subsection (a)(1)—(3) and (5) shall be filed within 30 days of their occurrence after commencement of operations.
(f) Changes or additions, or both, to the information in subsection (a)(6), (8), (9), (11)—(15), (17) and (18) shall be filed at least 60 days prior to use or effective date after commencement of operations.
(g) Changes or additions, or both, to the list of preferred providers shall be filed semiannually on or before March 31 and September 30 of each year.
(h) In addition to the information required by subsections (a)—(d), preferred provider organizations may be requested to provide the Commissioner and the Secretary with other material that is deemed necessary to complete the review of the application.
(i) An applicant which is simultaneously filing an application for a certificate of authority to operate as a health maintenance organization may incorporate by reference portions of that application in its application to operate as a preferred provider organization.
(j) An application for approval of a preferred provider organization shall be made by submitting two copies each to the Commissioner and the Secretary.
Cross References This section cited in 31 Pa. Code § 152.102 (relating to definitions).
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