(a) Whenever a contract exists between a prepaid limited health service organization and a provider, and the organization fails to meet its obligations to pay fees for services already rendered to a subscriber, who is in good standing, the prepaid limited health service organization is liable for the fee or fees rather than the subscriber, and the contract must so state.
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Terms Used In Tennessee Code 56-51-128

  • Contract: A legal written agreement that becomes binding when signed.
  • Enrollee: means an individual, including dependents, who is entitled to limited health services pursuant to a contract, or any other evidence of coverage, with a health maintenance organization, licensed pursuant to chapter 32 of this title, or a contract with a state or federal agency. See Tennessee Code 56-51-102
  • Insolvent: means that all the statutory assets of the prepaid limited health service organization, if made immediately available, would not be sufficient to discharge all of its statutory liabilities or that the prepaid limited health service organization is unable to pay its debts as they become due in the usual course of business. See Tennessee Code 56-51-102
  • Limited health service: means dental care services, vision care services, mental health services, substance abuse services, and pharmaceutical services. See Tennessee Code 56-51-102
  • Prepaid limited health service organization: means any person, corporation, partnership, or any other entity that, in return for a prepayment from a health maintenance organization or a state or federal agency, undertakes to provide or arrange for, or provide access to, the provision of a limited health service to enrollees through an exclusive panel of providers. See Tennessee Code 56-51-102
  • Provider: means , but is not limited to, any physician, dentist, health facility, or other person or institution that is duly licensed in this state to deliver limited health services. See Tennessee Code 56-51-102
  • Representative: when applied to those who represent a decedent, includes executors and administrators, unless the context implies heirs and distributees. See Tennessee Code 1-3-105
  • State: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Tennessee Code 1-3-105
  • Subscriber: means an individual on whose behalf a contract or arrangement has been entered into with a prepaid limited health service organization for health care services or other persons who also receive health care services as a result of the contract. See Tennessee Code 56-51-102
  • written: includes printing, typewriting, engraving, lithography, and any other mode of representing words and letters. See Tennessee Code 1-3-105
(b) No subscriber, who is in good standing, of a prepaid limited health service organization is liable to any provider of health care services for any services covered by the prepaid limited health service organization.
(c) No provider of prepaid limited health care services or any representative of the provider may collect or attempt to collect from a subscriber any money for services covered by a prepaid limited health service organization, and no provider or representative of the provider may maintain any action against a subscriber of a prepaid limited health service organization to collect money owed to the provider by a prepaid limited health service organization.
(d) Every contract between a prepaid limited health service organization and a provider of health care services must be in writing and must contain a provision that the subscriber is not liable to the provider for any services covered by the subscriber’s or enrollee‘s contract with the prepaid limited health service organization.
(e) This section does not apply to the amount of any deductible or copayment that is not covered by the contract, or for services not authorized by the prepaid limited health service organization.
(f)

(1) For all provider contracts, the contracts must provide that the provider will provide no less than ninety (90) days’ advance written notice to the prepaid limited health service organization before cancelling the contract with the prepaid limited health service organization for any reason.
(2) For all provider contracts, the organization shall be responsible for notifying all providers of the provisions of this section and their responsibilities under this chapter.
(g) Upon receipt by the prepaid limited health service organization of a ninety-day cancellation notice, the prepaid limited health service organization may, if requested by the provider, terminate the contract in less than ninety (90) days if the prepaid limited health service organization is not financially impaired or insolvent.
(h) Provider contracts must provide that the prepaid limited health service organization will provide ninety (90) days’ advance written notice to the provider before cancelling, without cause, the contract with the provider, except where a patient’s health is subject to imminent danger or a provider’s ability to practice is effectively impaired by an action by another governmental agency.
(i) Every contract between a prepaid limited health service organization and a provider of health care services must contain a provision that if any provision of the agreement is held to be unenforceable or otherwise contrary to any applicable laws, regulations, or rules, the provision shall have no effect and shall be severable without affecting the validity or enforceability of the remaining provisions of this agreement.
(j) A contract between a prepaid limited health service organization and a provider of limited health care services may not contain any provision restricting the provider’s ability to communicate information to the provider’s patient regarding care or treatment options for the patient when the provider deems knowledge of the information by the patient to be in the best interest of the health of the patient.
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