Illinois Compiled Statutes 215 ILCS 130 Limited Health Service Organization Act. Section 4006

    (215 ILCS 130/4006) (from Ch. 73, par. 1504-6)

    Sec. 4006. Supervision of rehabilitation, liquidation or conservation by the Director.

    (a) For purposes of the rehabilitation, liquidation or conservation of a limited health service organization, the operation of a limited health service organization in this State constitutes a form of insurance protection which should be governed by the same provisions governing the rehabilitation, liquidation or conservation of insurance companies. Any rehabilitation, liquidation or conservation of a limited health service organization shall be based upon the grounds set forth in and subject to the provisions of the laws of this State regarding the rehabilitation, liquidation or conservation of an insurance company and shall be conducted under the supervision of the Director. Insolvency, as a ground for rehabilitation, liquidation or conservation of a limited health service organization, shall be recognized when a limited health service organization cannot be expected to satisfy its financial obligations when such obligations are to become due or when the limited health service organization has neglected to correct, within the time prescribed by subsection (c) of Section 2004, a deficiency occurring due to such organization's prescribed minimum net worth being impaired. For purpose of determining the priority of distribution of general assets, claims of enrollees and enrollees' beneficiaries shall have the same priority as established by Section 205 of the Illinois Insurance Code, for policyholders and beneficiaries of insureds of insurance companies. If an enrollee is liable to any provider for services provided pursuant to and covered by the limited health care plan, that liability shall have the status of an enrollee claim for distribution of general assets.

    Any provider who is obligated by statute or agreement to hold enrollees harmless from liability for services provided pursuant to and covered by a limited health care plan shall have a priority of distribution of the general assets immediately following that of enrollees and enrollees' beneficiaries as described herein, and immediately preceding the priority of distribution described in paragraph (e) of subsection (1) of Section 205 of the Illinois Insurance Code.

    (b) For purposes of Articles XIII and XIII 1/2 of the Illinois Insurance Code, organizations in the following categories shall be deemed to be a domestic company and a domiciliary company:

        (1) a corporation organized under the laws of this

    State; or

        (2) a corporation organized under the laws of another

    state, 20% or more the enrollees of which are residents of this State, except where such a corporation is, in its state of incorporation, subject to rehabilitation, liquidation and conservation under the laws relating to insurance companies.

(Source: P.A. 89-206, eff. 7-21-95.)

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Last modified: February 18, 2015