PUBLIC LAW 100-517—OCT. 24, 1988
102 STAT. 2579
(1) Section 1301(c)(l)(A) (42 U.S-C. 300e(c)(l)(A)) is amended ix) read as follows: "(I)(A)have— "(i) a fiscally sound operation, and "(ii) adequate provision against the risk of insolvency, which is satisfactory to the Secretary, and". (2) Section 1301(c) (42 U.S.C. 300e(c)) is amended by adding after and below paragraph (9) the following: "The Secretary shall issue r^ulations stating the circumstances under which the Secretary, in administering paragraph (I)(A), will consider the resources of an organization which owns or controls a health maintenance organization. Such regulations shall require as a condition to consideration of resources that a n organization which owns or controls a health maintenance organization shall provide satisfactory assurances that it will assume the financial obligations of the health maintenance organization.". (3) During the period prior to the effective date of r^ulations issued under section 1301(c) of the Public Health Service Act (as amended by paragraph (2)), the Secretary of Health and Human Services shall consider the application for qualification under section 1301(c)(l)(A) of such Act of a health maintenance organization— (A) which is owned or controlled by another organization, and (B) which requests that the resources of the other organization be considered in determining its qualification under such section, if the Secretary receives satisfactory assurances from the other organization that it will assume the financial obligations of the health maintenance organization and if the Secretary determines that the other organization meets such other requirements as the Secretary determines are necessary, (b) BOARD OF DIHECTORS.—Paragraph (5) of section 1301(c) (42
U5.C. 300e(c)) is repealed and paragraphs (6) through (9) are redesignated as paragraphs (5) through (8), respectively. SECL & DEFINITIONS.
(a) QHGAN TRANSPLANTS.—Subsection (b) of section 812 of the
Health Maintenance Organization Amendments of 1986 (42 U.S.C. 300e-l note) is repealed. (b) COMMUNITY RATING.—
(1) The third sentence of section 1302(8)(C) (42 U.S.C. 300e1(8)(Q) is amended to read as follows: If a health maintenance organization is to fix rates of payment for individuals and families by groups, it shall— "(i)(1) classify all of the members of the organization into classes based on factors which the health maintenance organization determines predict the differences in the use of health services by the individuals or families in each class and which have not been disapproved by the Secretary, "(II) determine its revenue requirements for providing services to the members of each class established under subclause (I), and "(in) fix the rates of payments for the individuals and families of a group on the basis of a composite of the
42 USC 300e ^°^-