Unless the context otherwise requires, the following definitions
shall apply as the terms are used in both this regulation and Chapter 33 of
Title 38 of the 1976 South Carolina Code, as amended (the Health Maintenance
Organization Act of 1987):
health care services" means emergency care, inpatient hospital and physician
care, and outpatient medical services. "Basic health care services" does not
include dental services, mental health services, or services for alcohol or
drug abuse, although a health maintenance organization may at its option elect
to provide these services in its coverage.
B. "Contractholder" means a person or entity
consisting of employees or eligible persons which has entered into a group
contract with a health maintenance organization for the provision of specified
health care services to its eligible employees or eligible persons.
C. "Commissioner" means the Chief Insurance
D. "Copayment" or
"deductible" means the amount specified in the evidence of coverage that the
enrollee shall pay directly to the provider for covered health care services,
which may be stated in either specific dollar amounts or as a percentage of the
provider's usual or customary charge.
E. "Department" means the Department of
Health and Environmental Control.
F. "Eligible dependent" means any member of a
subscriber's family who meets the eligibility requirements set forth in
Subsection D of Section III of this regulation.
"Emergency care services" means:
1. Within the service area: covered health
care services rendered by affiliated or non-affiliated providers under
unforeseen conditions that require immediate medical attention. Emergency care
services within the service area shall include covered health care services
from non-affiliated providers only when delay in receiving care from the health
maintenance organization could reasonably be expected to cause severe jeopardy
to the enrollee's condition.
Outside the service area: medically necessary health care services that are
immediately required because of unforeseen illness or injury while the enrollee
is outside the geographical limits of the health maintenance organization's
"Enrollee" or "member" means an individual who is enrolled in a health
"Evidence of coverage" means any certificate, agreement or contract issued to
an enrollee setting out the coverage to which he is entitled.
J. "Group contract" means a contract for
health care services which by its terms limits eligibility to members of a
K. "Health care
services" means any services included in the furnishing to any individual of
medical or dental care or hospitalization, or incident to the furnishing of
such care or hospitalization, as well as the furnishing to any person of any
and all other services for the purposes of preventing, alleviating, curing, or
healing human illness, injury or physical disability.
L. "Health maintenance organization" means
any person that undertakes to provide or arrange for basic health care services
to enrollees for a fixed prepaid premium.
M. "Health professional" means any
professional engaged in the delivery of health care services who is licensed,
and practicing within the scope of such a license, where such licensing is
required by state law.
"Hospital" means a duly licensed institution which provides general and
specialized inpatient medical care. The term "hospital" shall not include a
convalescent facility, nursing home, or any institution or part thereof which
is used principally as a convalescent facility, rest facility, nursing
facility, or facility for the aged.
O. "Individual contract" or "nongroup
contract" means a contract for health care services issued to and covering an
individual or a family.
necessity" or "medically necessary" means appropriate and necessary services as
determined by any provider affiliated with the health maintenance organization
which are rendered to an enrollee for any condition requiring, according to
generally accepted principles of good medical practice, the diagnosis or direct
care and treatment of an illness or injury and are not provided only as a
services" means the health care services that a health maintenance organization
covers when its enrollees are outside of the service area.
R. "Person" means any natural or artificial
person including but not limited to individuals, partnerships, associations,
trusts, or corporations.
"Physician" means a duly licensed doctor of medicine or osteopathy practicing
within the scope of such a license.
T. "Primary care physician" means a physician
who supervises, coordinates, and provides initial and basic care to members;
initiates their referral for specialist care and maintains continuity of
U. "Provider" means
any physician, dentist, hospital, pharmacist, or other person properly
licensed, where required, to furnish health care services.
V. "Service area" means the geographical area
as approved by the Commissioner within which the health maintenance
organization provides or arranges for health care services that are available
and accessible to enrollees.
"Skilled nursing facility" means a facility that is operated pursuant to law
and primarily engaged in providing, in addition to room and board
accommodations, skilled nursing care under the supervision of a duly licensed
X. "Subscriber" means
the individual whose employment or other status, except for family dependency,
is the basis for eligibility for enrollment in the health maintenance
organization and who is in fact enrolled in the health maintenance
health care services" means any health care services other than basic health
Contracts and Evidence of Coverage.
subscriber shall be entitled to a contract or evidence of coverage as approved
by the Commissioner. A contract or evidence of coverage shall be delivered or
issued for delivery to a subscriber or to the contractholder for delivery to
the subscriber within a reasonable time after enrollment, but not more than
thirty (30) days from the later of the effective date of coverage or the date
on which the health maintenance organization is notified of
1. The contract and
evidence of coverage shall contain the name, address and telephone number of
the health maintenance organization, and where and in what manner information
is available as to how services may be obtained.
2. A toll-free or local phone number within
the service area for calls, without charge to members, to the health
maintenance organization's administrative office shall be made available and
disseminated to enrollees to adequately provide telephone access for member
services, problems or questions.
1. The contract shall contain a statement
that the contract, all applications and any amendments thereto shall constitute
the entire agreement between the parties.
2. No portion of the charter, bylaws or other
document of the health maintenance organization shall be part of such a
contract unless set forth in full in the contract or attached
1. The contract shall contain the
time and date or occurrence upon which coverage takes effect, including any
applicable waiting periods, or describe how the time and date or occurrence
upon which coverage takes effect is determined.
2. The contract shall contain the time and
date or occurrence upon which coverage will terminate.
1. The contract and evidence of coverage
shall contain eligibility requirements indicating the conditions that must be
met to enroll as a subscriber or eligible dependent, the limiting age for
subscribers and eligible dependents including the effects of Medicare
eligibility, and a clear statement regarding coverage of newborn
The definition of an
eligible dependent shall as a minimum include:
a. the spouse of the subscriber;
b. an unmarried dependent child of the
subscriber who has not reached age 19;
c. an unmarried dependent child of the
subscriber age 19 or over, who is both incapable of self support because of
intellectual disability, mental illness or physical incapacity which began
before the child reached age 19, and chiefly dependent upon the subscriber for
support and maintenance; or
unmarried dependent child of the subscriber age 19 through 22 who is attending
a recognized college or university, trade or secondary school on a full-time
of a dependent child shall as a minimum include children who are:
a. related to the subscriber as either a
natural child, a legally adopted child, a stepchild, a foster child, or a child
under legal guardianship; or
other child residing in the subscriber's household and who qualifies as a
dependent of the subscriber or the subscriber's spouse under the United States
Internal Revenue Code and federal tax regulations.
4. All contracts and evidences of coverage
shall provide coverage for a newly-born child of the subscriber from the moment
of birth. Medically diagnosed congenital defects and birth abnormalities shall
be treated the same as any other illness or injury for which coverage is
provided. The contract and evidence of coverage may require that notification
of birth of a newborn child and payment of any required premium must be
furnished to the health maintenance organization within thirty-one (31) days
after the date of birth in order for such coverage to have become effective and
to continue beyond such thirty-one (31) day period.
F. Benefits and Services within the Service
Area. The contract and evidence of coverage shall contain a specific
description of benefits and services available within the service
G. Emergency Care Services.
The contract and evidence of coverage shall contain a specific description of
benefits and services available for emergencies twenty-four (24) hours a day,
seven (7) days a week, including disclosure of any restrictions on emergency
care services. No contract or evidence of coverage shall limit the coverage of
emergency services within the service area to affiliated providers
H. Out-of-Area Benefits and
Services. The contract and evidence of coverage shall contain a specific
description of benefits and services available out of the service
I. Copayments, Deductibles,
Limitations and Exclusions. The contract and evidence of coverage shall contain
a description of any copayments, deductibles, limitations or exclusions on the
services, kind of services, benefits, or kind of benefits to be provided,
including any copayments, deductibles, limitations or exclusions due to
preexisting conditions, waiting periods or an enrollee's refusal of treatment.
J. Cancellation or Termination.
The contract and evidence of coverage shall contain the conditions upon which
cancellation or termination may be effected by the health maintenance
organization or the subscriber.
Renewal. The contract and evidence of coverage shall contain the conditions
for, and any restrictions upon, the subscriber's right to renewal.
L. Reinstatement. The contract and evidence
of coverage shall contain the conditions for, and any restrictions upon, the
subscriber's right to reinstatement.
1. The contract and evidence of coverage
shall provide for a grace period of not less than thirty-one (31) days for the
payment of any premium except the first, during which coverage shall remain in
effect if payment is made during the grace period.
2. During the grace period, the health
maintenance organization shall remain liable for providing the services and
benefits contracted for, the contractholder shall remain liable for the payment
of the premium for the time coverage was in effect during the grace period, and
the subscriber shall remain liable for any copayments or deductibles owed.
Claims. The contract
and evidence of coverage shall contain procedures for filing claims that
1. any required notice to the health
2. if any
claim forms are required, how, when and where to obtain and submit
3. any requirements for
filing proper proofs of loss;
any time limit on payment of claims;
5. notice of any requirement for resolving
disputed claims including arbitration; and
6. a statement of restrictions, if any, on
assignment of sums payable to the enrollee by the health maintenance
Complaint System and Arbitration. The contract and evidence of coverage shall
contain a description of the health maintenance organization's method for
resolving enrollee complaints, incorporating procedures to be followed by the
enrollee in the event any dispute arises under the contract, including any
requirements for arbitration.
Conversion of Coverage.
The contract and
evidence of coverage shall contain a conversion provision which provides that
each enrollee has the right to convert coverage to an individual health
maintenance organization contract or to a policy of health insurance issued by
a licensed insurer on a form previously approved by the Chief Insurance
Commissioner in the following circumstances:
a. upon termination of eligibility for
coverage under a group or individual contract; or
b. upon termination of the group
2. To obtain
the conversion contract, an enrollee shall submit a written application and the
applicable premium payment within the time period and in the manner prescribed
The enrollee shall be entitled to the same right of continuation of coverage as
contract shall not be required to be made available if:
a. the enrollee's termination of coverage
occurred for any of the reasons listed in Subparagraphs 1.a. (1), (2), or (3)
of Subsection B of Section IV of this regulation;
b. the enrollee is covered by or is eligible
for benefits under Medicare, Title XVIII of the United States Social Security
c. the enrollee is covered by
or is eligible for similar hospital, medical or surgical benefits under state
or federal law;
d. the enrollee is
covered by or is eligible for similar hospital, medical or surgical benefits
under any arrangement of coverage for individuals in a group;
e. the enrollee is covered for similar
benefits by an individual policy or contract; or
f. the enrollee has not been continuously
covered during the three-month period immediately preceding that person's
termination of coverage.
4. As a minimum, the conversion contract
shall provide basic health care services if conversion is to a health
maintenance organization contract or shall provide benefits meeting the minimum
requirements of Section
if conversion is to a policy of health insurance.
5. Coverage shall be provided without
requiring evidence of insurability and shall not impose any preexisting
condition limitations or exclusions as described in Subsection A of Section IV
other than those remaining unexpired under the contract from which conversion
is exercised. Any probationary or waiting period set forth in the conversion
contract shall be deemed to commence on the effective date of the enrollee's
coverage under the prior contract.
Q. Group Contract Discontinuance and
Replacement. The provision of S. C. Code Section
governing discontinuance and replacement of coverage are applicable to group
health maintenance organization contracts.
Coordination of Benefits.
1. The contract and evidence of coverage may
contain a provision for coordination of benefits that shall be consistent with
that applicable to other health insurers and health maintenance organizations
in South Carolina.
provisions or rules for coordination of benefits established by a health
maintenance organization shall not relieve a health maintenance organization of
its duty to provide or arrange for a covered health care service to any
enrollee because the enrollee is entitled to coverage under any other contract,
policy or plan, including coverage provided under government
1. An individual contract
shall contain a provision stating that a person who has entered into an
individual contract with a health maintenance organization shall be permitted
to return the contract within ten (10) days of receiving it and to receive a
refund of the premium paid if the person is not satisfied with the contract for
2. If the contract is
returned to the health maintenance organization or to the agent through whom it
was purchased, it is considered void from the beginning.
3. However, if services are rendered or
claims are paid for such person by the health maintenance organization during
the ten-day examination period, the person shall not be permitted to return the
contract and receive a refund of the premium paid.
T. Subrogation/Injuries Caused by Third
Parties. Any provisions concerning subrogation for injuries caused by third
parties shall conform to the requirements of S. C. Code Section
(1976), as amended.
with State Law. Any contract and evidence of coverage that contains any
provision not in conformity with the Health Maintenance Organization Act of
1987 shall not be rendered invalid but shall be construed and applied as if it
were in full compliance with this regulation and the Health Maintenance
Organization Act of 1987.
1. A health
maintenance organization contract may contain a provision limiting coverage for
preexisting conditions must be covered no later than twelve months without
medical care, treatment, or supplies ending after the effective date of the
coverage or twelve months after the effective date of the coverage, whichever
conditions are defined as "those conditions for which medical advice or
treatment was received or recommended no more than twelve months prior to the
effective date of a person's coverage".
Termination of Coverage.
No health maintenance organization shall
cancel coverage of services provided an enrollee under an individual or group
health maintenance organization contract except for one or more of the
(1) failure to pay the
amounts due under the contract;
fraud or material misrepresentation in enrollment or in the use of services or
(3) material violation
of the terms of the contract;
failure to meet the eligibility requirements under a group contract, provided
that a conversion option is offered.
b. However, coverage shall not be cancelled,
terminated or nonrenewed on the basis of the status of the enrollee's health
nor on the fact that the enrollee has exercised his rights under the health
maintenance organization's complaint system by registering a complaint against
the health maintenance organization.
a. Group Contracts. No health maintenance
organization shall nonrenew a group health maintenance organization contract
except on the anniversary date of the contract.
b. Individual Contracts. No health
maintenance organization shall nonrenew coverage of services provided an
enrollee under an individual health maintenance organization contract unless it
has received prior approval from the Commissioner, upon such terms as he deems
just, to nonrenew all individual health maintenance organization contracts in
4. No health
maintenance organization shall cancel, terminate or nonrenew an enrollee's
coverage for services provided under a health maintenance organization contract
without giving the enrollee or contractholder written notice of termination
which shall be effective at least thirty-one (31) days from the date of mailing
or, if not mailed, from the date of delivery and which shall include the reason
for termination. For termination due to nonpayment of premium, the grace period
as required in Subsection M of Section III of this regulation shall apply. No
written notice of termination shall be required to be given for termination due
to nonpayment of premium.
health maintenance organization that provides in the contract and evidence of
coverage, that coverage of a dependent child shall terminate upon attainment of
the limiting age for dependent children shall terminate the coverage of such
child if the child is and continues to be both:
a. incapable of self support because of
intellectual disability, mental illness or physical incapacity, and
b. chiefly dependent upon the subscriber for
support and maintenance.
6. Proof of such incapacity and dependency
shall be furnished to the health maintenance organization by the subscriber
within thirty-one (31) days of the child's attainment of the limiting age and
subsequently as reasonably required by the health maintenance organization, but
not more frequently than annually after the two-year period following the
child's attainment of the limiting age.
1. No health maintenance organization shall
unfairly discriminate against any enrollee or applicant for enrollment on the
basis of the age, sex, race, color, creed, national origin, ancestry, religion,
marital status or lawful occupation of an enrollee, or because of the frequency
of utilization of services by an enrollee.
2. However, nothing shall prohibit a health
maintenance organization from setting rates or establishing a schedule of
charges in accordance with relevant actuarial data.
3. No health maintenance organization shall
expel or refuse to re-enroll any enrollee nor refuse to enroll individual
members of a group on the basis of the health status or health care needs of
the individual enrollee or member.
Access to Care.
A health maintenance organization shall
establish and maintain adequate arrangements to provide the health services
contracted for by its subscribers including:
a. reasonable proximity to the business or
personal residences of the enrollees so as not to result in unreasonable
barriers to accessibility;
reasonable hours of operation and after-hours services;
c. emergency care services available and
accessible within the service area twenty-four (24) hours a day, seven (7) days
a week; and
d. sufficient providers
and personnel, including health professionals, administrators and support
staff, to assure that all services contracted for will be accessible to
enrollees on an appropriate basis without delays detrimental to the health of
2. A health
maintenance organization utilizing primary care physicians shall make primary
care physician services available to each enrollee and shall provide
accessibility to medically necessary specialists through staffing, contracting
or referral. Such a health maintenance organization shall provide for
continuity of care for enrollees referred to specialists.
A health maintenance organization shall
have written procedures governing the availability of frequently utilized
services contracted for by enrollees, including at least the following:
a. well-patient examinations and
telephone consultation on a twenty-four (24) hours per day, seven (7) days per
c. treatment of
d. treatment of minor
e. treatment of
Basic Health Care Services. A health
maintenance organization shall provide, or arrange for the provision of, as a
minimum, basic health care services which shall include the following:
1. Emergency care services, as defined in
Section 1 of this regulation.
Inpatient hospital services, meaning medically necessary hospital services
including, but not limited to, room and board; general nursing care; special
diets when medically necessary; use of operating room and related facilities;
use of intensive care units and services; x-ray, laboratory and other
diagnostic tests; drugs, medications, biologicals, anesthesia and oxygen
services; special nursing when medically necessary; physical therapy, radiation
therapy and inhalation therapy; administration of whole blood and blood plasma;
and short-term rehabilitation services.
3. Inpatient physician care services, meaning
medically necessary health care services performed, prescribed, or supervised
by physicians or other health professionals including diagnostic, therapeutic,
medical, surgical, preventive, referral and consultative health care
4. Outpatient medical
services, meaning preventive and medically necessary health care services
provided in a physician's office, a non-hospital-based health care facility, or
at a hospital. Outpatient medical services shall include but are not limited to
diagnostic services; treatment services; laboratory services; x-ray services;
referral services; and physical therapy, radiation therapy and inhalation
therapy. Outpatient services shall also include preventive health services
which shall include, at least a broad range of voluntary family planning
counseling services, well-child care from birth, periodic health evaluations
for adults, screening to determine the need for vision and hearing correction,
and pediatric and adult immunizations in accordance with accepted medical
Services and Benefits.
1. Copayments or
deductibles for out-of-area services shall be shown in the contract and
evidence of coverage.
enrollee is traveling or temporarily out of a health maintenance organization's
service area, a health maintenance organization shall provide benefits for
reimbursement for emergency care services subject to the following condition:
a. the condition could not reasonably have
b. the enrollee
could not reasonably arrange to return to the service area to receive treatment
from the health maintenance organization's provider;
c. the travel must be for some purpose other
than the receipt of medical treatments; and
d. the health maintenance organization is
notified by telephone within twenty-four (24) hours of the commencement of such
care unless it is shown that it was not reasonably possible to communicate with
the health maintenance organization in such time limits.
3. Services received by an enrollee outside
of the health maintenance organization's service area will be covered only so
long as it is unreasonable to return the enrollee to the service
Health Care Services.
1. In addition to the
basic health care services required to be provided in Subsection B of this
Section, a health maintenance organization may offer to its enrollee any
supplemental health care services it chooses to provide.
2. Limitations as to time and cost may vary
from those applicable to basic health care services.
Description of Providers.
1. A health maintenance organization shall
provide its subscribers with a list of the names and locations of all of its
providers no later than the time of enrollment or the time the contract and
evidence of coverage are issued and upon request thereafter. If a provider is
no longer affiliated with a health maintenance organization, the health
maintenance organization shall provide notice of such change to its affected
subscribers and to the Department in a timely manner. Subject to the approval
of the Commissioner, a health maintenance organization may provide its
subscribers with a list of providers or provider groups for a segment of the
service area. However, a list of all providers shall be made available to
subscribers upon request.
list of providers shall contain a notice regarding the availability of the
listed providers. Such notice shall be in not less than twelve point type and
be placed in a prominent place on the list of providers. The notice shall
contain the following language: Enrolling in [name of HMO] does not guarantee
services by a particular provider on this list. If you wish to be sure of
receiving care from specific providers listed, you should contact the health
maintenance organization to be sure that the particular provider is accepting
additional patients for [name of HMO]. Even if a particular provider is
participating in [name of HMO] on the date you enroll, there is no guarantee
that the provider will continue to participate during the entire term of your
enrollment in [name of HMO].
Description of the Service Area.
1. A health maintenance organization shall
provide its subscribers with a description of its service area no later than
the time of enrollment or the time the contract and evidence of coverage is
issued and upon request thereafter.
2. If the description of the service area is
changed, the health maintenance organization shall provide at such time a new
description of the service area to its affected subscribers and to the
Copayments and Deductibles.
1. A health
maintenance organization may require copayments or deductibles of enrollees as
a condition for the receipt of specific health care services.
2. Copayments or deductibles for basic health
care services shall be shown in the contract and evidence of
1. A complaint system shall be
established and maintained by a health maintenance organization to provide
reasonable procedures for the prompt and effective resolution of written
2. The complaint system
shall provide for written acknowledgement of complaints and complaints to be
resolved or to have a final determination of the complaint by the health
maintenance organization complaint system within a reasonable period of time,
but not more than ninety (90) days from the date the complaint is registered.
This period may be extended in the event of a delay in obtaining the documents
or records necessary for the resolution of the complaint, or by the mutual
written agreement of the health maintenance organization and the
3. Pending the resolution
of a written complaint filed by a subscriber or enrollee, coverage may not be
terminated for any reason which is the subject of the written complaint, except
where the health maintenance organization has, in good faith, made a reasonable
effort to resolve the written complaint through its complaint system and
coverage is being terminated as provided for in Subsection B of Section
4. If enrollee complaints and
grievances may be resolved through a specified arbitration agreement, the
enrollee shall be advised in writing of his rights and duties under the
agreement at the time the complaint is registered. Any such agreement must be
accompanied by a statement setting forth in writing the terms and conditions of
binding arbitration. Any health maintenance organization that makes such
binding arbitration a condition of enrollment must fully disclose this
requirement to its enrollees in the contract and evidence of