Code of Alabama - Title 22: Health, Mental Health, and Environmental Control - Section 22-21-375 - Issuance of license; revocation; procedures for review and mediation of complaints

Section 22-21-375 - Issuance of license; revocation; procedures for review and mediation of complaints.

(a) The Department of Insurance shall issue a license to each applicant upon payment of the prescribed fees and upon being satisfied that:

(1) The applicant has been organized in a bona fide manner for the purpose of establishing, maintaining, and operating a dental service plan.

(2) Each contract executed, or proposed to be executed, by the applicant and a dentist obligates, or will when executed obligate, such dentist to render the service or accept payment for the service to which each subscriber may be entitled under the terms of the contract issued to the subscriber.

(3) Each contract issued, or proposed to be issued, to subscribers is in a form approved by the department and that the rates charged, or proposed to be charged, for each form of such contract and benefits to be provided pursuant thereto are fair and reasonable and are actuarially sound.

(4) No contributions to the funds of the dental service plan corporation for working capital are repayable by the corporation except out of earned income over and above operating expenses and dental expenses and such reserves as the department may deem adequate.

(5) The amount of money actually received by the applicant for working capital is sufficient according to the terms specified in subsection (6) to carry all acquisition costs and operating expenses for a period of at least six months from the date of issuance of license or $100,000.00, whichever is greater.

(6) The owners or persons controlling or managing the dental service plan have been found by the department to be competent, trustworthy, and to possess managerial experience that would make the proposed dental service plan corporation beneficial to the persons receiving dental services or benefits therefrom. The department shall not grant or continue authority to transact the business of a dental service plan corporation at any time if the department has good reason to believe that any owner or other person controlling or managing said corporation is a person whose business operations are or have been marked by business practices or conduct that is to the detriment of the public, of creditors, or of persons receiving dental services, either through the improper manipulation of assets or accounts or by bad faith.

(7) The applicant has obtained valid contracts with an adequate number of dentists to provide the services proposed to the projected subscriber population.

(8) The plan has a reasonable possibility of success, based on projections by the applicant and on information otherwise available to the department.

(b) Such license shall remain in effect unless revoked by the department and any dental service plan corporation to which such license has been issued and is in effect shall be authorized to issue contracts, in the form or forms approved by the department, to the persons who may become subscribers. However, the department shall revoke the license of any such corporation which is not in active operation within six months of the issuance of the license unless good cause is shown.

(c) Except as otherwise provided by this article, no person shall operate a dental service plan corporation without a license as herein required.

(d) Each dental service plan corporation shall establish procedures for review and mediation of complaints of subscribers concerning the quality of care rendered by a participating dentist, complaints of subscribers or participating dentists concerning the benefits or the operations of the plan, and complaints of the corporation concerning any element of its relationship with a participating dentist. Such procedures shall be subject to the approval of the department. In addition to establishing such procedures, the corporation may agree in a written document submitted to the department the corporation's desire to utilize the peer review services of the Alabama Dental Association. Subscribers and participating dentists shall be made aware of the review mechanism adopted by the dental service plan corporation and shall be informed as to how to submit a complaint for review.

(Acts 1982, No. 82-463, p. 741, §16.)

Last modified: May 3, 2021