DRAFT CSC, Title 21.  Health & Sanitation
 
CHAPTER 1
Chuuk State Health Care Act

Subchapters:
A     General Provisions ( 1001-1004)
            B     Board of Trustees, Officers & Corporate Powers ( 1010-1026)
            C     Eligibility for Benefits ( 1030-1031)
            D     Nature and Scope of Benefits ( 1038-1047)
            E     Assessments and Premiums ( 1050-1057)
F     Trust Fund ( 1060-1062)
G     Administration ( 1068-1076)
H     Support for the Essential Level of Health Insurance Coverage ( 1080-1085)
I      Government Assistance ( 1090-1092)
J     Effective Date ( 1098)


Title I SUBCHAPTER A
General Provisions

1001.  Short Title.
1002.  Purpose.
1003.  Establishment.
1004.  Definitions.

      1001.  Short Title.
     This Act Chapter may be cited as the "Chuuk State Health Care Act of 1994.'

Source:  CSL 2-94-06, 1-1, modified.

Editor's note:  CSL 2-94-06 was signed into law by the Governor on April 24, 1994.  See effective date provision of 17 CSC 1098.

Cross-reference:  The constitutional provisions on health are found in Art. X, Sections 6 and 7 of the Chuuk State Constitution.  Sections 6 and 7 state as follows:

     Section 6.  The State Government shall provide for the protection and promotion of health, and shall ensure, within the limits of its resources, that no person is discriminated against in the distribution of medical care, or is refused medical care because of that person's inability to pay.
     Section 7.  The State Government shall provide for the establishment and administration of a comprehensive system of medical or health insurance which is mandatory for all employed residents of the State of Chuuk while present in the State.  All revenues received under this system of medical or health insurance, and all other revenues received by the Health Department as payment for medicine and medical services, shall be separated from any general fund established by the Legislature and used only for medical purposes.

      1002.  Purpose.
     The purpose of this Act Chapter is to improve the provision and quality of health services to residents of the State of Chuuk, to establish a financial system to provide universal coverage of an essential level of health care for all eligible enrollees and to create a means for collection of health care premiums for additional coverage.  This Act Chapter establishes a means to control the costs, and to improve of health care providers within and outside of Chuuk State.

Source:  CSL 2-94-06, 1-2, modified.

      1003.  Establishment.
     The Chuuk State Health Care Plan is hereby established as a public corporation under the laws of Chuuk State.

Source:  CSL 2-94-06, 1-3, modified.
 
      1004.  Definitions.
     As used in this Act Chapter:

     (1)  "Board" means the Board of Trustees of the Chuuk State Health Care Plan;

     (2)  "Bylaws" means the bylaws of the Chuuk State Health Care Plan in effect from time to time;

     (3)  "Dependent" means the spouse and children of an enrollee for additional coverage under this Act Chapter, including stepchildren and adopted children, who are unmarried and under 19 years of age, and handicapped dependent children who are physically or mentally incapable of earning a living; any student under 21 years of age who is unmarried and a full-time student and who is primarily supported by his or her enrollee parents; and unemployed dependent parents over the age of 60 and are citizens of  Chuuk State residing in Chuuk State;

     (4)  "Employee" means any individual who has been employed for wages or salaries for services from an employer as defined in Subsection (5) of this Section for at least 15 working days and who regularly provides such services to the employer for 20 hours or more each week;

     (5)  "Employer" means any person as defined in Subsection (10) of this Section who employs the services of others and pays them wages or salaries or a person who is self-employed, that is, a person who earns money for labor or goods;
 
     (6)  "Enrollee" means any individual eligible to receive benefits under this Act Chapter; provided that an enrollee may be eligible for only the essential level of benefits, or may be eligible for additional levels of benefits as provided for in this Act Chapter and such regulations as may be issued pursuant hereto;

     (7)  "Executive Director" means the Executive Director of the Chuuk State Health Care Plan;

     (8)  "Fund" means the Trust Fund to be established by the Board pursuant to Section 6-1 1060 of this Act Chapter;

     (9)  "Off-island Health Care Facility" means any facility providing covered services as defined in Section 4-4 1041 of this Act Chapter which is located outside of Chuuk State and which is determined by the Board to be a qualified provider (as defined in Section 4-6 1043 of this Act Chapter);

     (10)  "Person" includes any individual, trust, estate, partnership, corporation, association, joint stock company, bank, insurance company, credit union, cooperative, or other entity or group (including any government, whether local or foreign, or any agency or instrumentality thereof);

     (11)  "Plan" means the Chuuk State Health Care Plan;

     (12)  "Provider" means any person furnishing any covered service (as defined in Section 4-4 1041 of this Act Chapter);

     (13)  "Referral" means a referral of an enrollee to an out of state health care facility granted pursuant to Section 4-2 1039 of this Act Chapter;

     (14)  "Regulation" means the regulations adopted by the Board and approved by the Governor for the administration of the Plan;

     (15)  "Resident" means any citizen of Chuuk for whom Chuuk State is his principal residence, or any noncitizen who has established an ongoing physical presence in Chuuk State and whose presence is sanctioned by law and is not merely transitory in nature;

     (16)  "State" or "Chuuk" means the State of Chuuk; and

     (17)  "Third-party administrator" means the individual or firm within or outside of Chuuk State, which contracts to perform administrative services in the operation of the Plan.

Source:  CSL 2-94-06, 1-4, modified.

Cross-reference:  The constitutional provisions on health are found in Art. X, Sections 6 and 7 of the Chuuk State Constitution.
 
 

Title II. SUBCHAPTER B
Board of Trustees,
Officers & Corporate Powers

1010.  Board of Trustees.
1011.  Organization Meeting.
1012.  Terms of Office and Reappointment.
1013.  Vacancies.
1014.  Removal.
1015.  Meetings.
1016.  Quorum.
1017.  Deadlock.
1018.  Election of Chairman.
1019.  Election of Vice-Chairman.
1020.  Compensation of Board members.
1021.  Exclusion from Employment.
1022.  Bylaws.
1023.  Personnel and Procurement.
1024.  Officers.
1025.  Corporate Powers.
1026.  Regulations.

      1010.  Board of Trustees.

     (1)  The governing and administrative powers of the Plan shall be vested in a Board of Trustees which shall consist of five voting members and the Executive Director who shall serve as an ex-officio, non-voting member of the Board; and

     (2)  The Governor shall appoint the five voting members of the Board, with the advice and consent of the Senate.  The Board shall be composed of members experienced in financing, health care administration, medical or legal practice, health care development or health care  improvement.  Within five years following the first organizational meeting of the Board, the Board shall submit to the Governor and the Chuuk State Legislature draft legislation to provide for the periodic popular selection of Board members by citizen enrollees of the Plan.

Source:  CSL 2-94-06, 2-1, modified.

Cross-reference:  The constitutional provisions on health are found in Art. X, Sections 6 and 7 of the Chuuk State Constitution.  Sections 6 and 7 state as follows:

     Section 6.  The State Government shall provide for the protection and promotion of health, and shall ensure, within the limits of its resources, that no person is discriminated against in the distribution of medical care, or is refused medical care because of that person's inability to pay.
     Section 7.  The State Government shall provide for the establishment and administration of a comprehensive system of medical or health insurance which is mandatory for all employed residents of the State of Chuuk while present in the State.  All revenues received under this system of medical or health insurance, and all other revenues received by the Health Department as payment for medicine and medical services, shall be separated from any general fund established by the Legislature and used only for medical purposes.

      1011.  Organizational Meeting.
     The first meeting of the Board shall be held after appointment of at least a quorum of the members of the Board have been confirmed by the Senate.  Such first meeting shall be called and chaired by the Lt. Governor until the chairman is elected.

Source:  CSL 2-94-06, 2-2, as amended by CSL 3-95-08, 1.

      1012.  Terms of Office and Reappointment.
     Of the voting Board members initially appointed, one shall serve for a term of one year, two shall serve for a term of two years, and two shall serve for a term of three years, all as determined by the drawing of lots at the organizational meeting.  A member appointed to fill a vacancy occurring during the term for which his predecessor was appointed shall be appointed for the remainder of that term.  Each Board member shall hold office until his successor is appointed and qualified.  Board members shall be eligible for reappointment.

Source:  CSL 2-94-06, 2-3.

      1013.  Vacancies.
     Vacancies in the membership of the Board shall be filled in the same manner as the original appointment.  A vacancy exists in the case of death, resignation, or removal of any Board member.

Source:  CSL 2-94-06, 2-4.

      1014.  Removal.
     Any Board  member may be removed from office by the affirmative vote of four voting Board members.

Source:  CSL 2-94-06, 2-5.

      1015.  Meetings.

     (1)  Regular meetings of the Board shall be held quarterly at such times, at such places, and upon such notice as shall be provided in the bylaws;

     (2)  Special meetings of the Board shall be called by the Chairman or by any three Board members at such places and upon such notice as provided in the bylaws;

     (3)  Members of the Board or of any committee of the Board may participate in and act at any meeting of the Board or a committee through the use of a conference telephone or other communication equipment by means of which all persons participating in the meeting can hear each other.  Participation in such meeting shall constitute attendance and presence in person at the meeting of the person or persons so participating; and

     (4)  Full and accurate minutes of all Board meetings shall be kept in such manner as shall be provided in the bylaws.

Source:  CSL 2-94-06, 2-6.

      1016.  Quorum.
     Three voting Board members shall constitute a quorum and the action of three voting Board members present at any meeting is valid as a corporate act.

Source:  CSL 2-94-06, 2-7.

      1017.  Deadlock.
     In the event that the voting members of the Board are evenly divided concerning an action or decision of the Board, the Executive Director shall vote on the action or decision.

Source:  CSL 2-94-06, 2-8.

      1018.  Election of Chairman.
     The Board shall elect from among its members a Chairman who will convene and preside over meetings of the Board.  The Chairman shall perform such other duties as may be prescribed by the bylaws or from time to time assigned by the Board.  The Chairman shall serve for a term of one year and shall not be eligible for consecutive one-year terms as Chairman.

Source:  CSL 2-94-06, 2-9.

      1019.  Election of Vice-Chairman.
     The Board shall elect from among its members a Vice-Chairman who shall, in the absence of the Chairman, perform the duties of the Chairman.  The Vice-Chairman shall serve for a term of one year and shall not be eligible for consecutive one-year terms as Vice-Chairman.

Source:  CSL 2-94-06, 2-10.

      1020.  Compensation of Board members.
     Board members who are employees of the Chuuk State Government or of any other cooperating entity shall serve without compensation paid by the Plan, but may continue to receive their regular salaries.  Board members who are not employees of the Chuuk State Government or of any other cooperating entities shall be entitled to compensation at rates established by the Board but not to exceed $20.00 per day while attending to the business of the Plan.  Board members shall be entitled to payment for travel expenses necessarily incurred when serving the Plan away from their places of residence at rates not to exceed that accorded to Chuuk State Government employees.

Source:  CSL 2-94-06, 2-11, modified.

      1021.  Exclusion from Employment.
     No Board member (other than the Executive Director) shall be an employee of the Plan during his term of office as a Board member or for one year thereafter.

Source:  CSL 2-94-06, 2-12.

      1022.  Bylaws.
     The Board shall adopt, amend, or repeal such bylaws as are necessary to provide for the management of the business of the Plan, the organization, meetings and procedures of the Board, the duties of officers and employees, and the preparation and submission of required reports.

Source:  CSL 2-94-06, 2-13.

      1023.  Personnel and Procurement.

     (1)  Officers and employees of the Plan shall be exempt from the provisions of the Public Service System Act and compensation plan of the Chuuk State Government; provided that within 120 days following its first organization meeting the Board shall provide in the bylaws of the Plan a complete personnel system for the recruitment, management and compensation of officers and employees of the Plan;

     (2)  The Plan shall be subject to State procurement and contracting laws until such time that the Board has established and maintained in its bylaws a contraction and procurement code certified by the Director of the Chuuk State Department of Treasury to be sufficient to meet United States standards for state and local government administration of federal grants;

     (3)  The personnel and procurement systems established by the Board may provide for reasonable preferences for the employment of qualified citizens of this State and procurement for businesses resident within the State; provided, however, that the systems shall have as their primary objective in employment and procurement the fulfillment of the purposes for which the Plan has been established.

Source:  CSL 2-94-06, 2-14, modified.

      1024.  Officers.

     (1)  The Board shall select an Executive Director for the Plan who shall serve at the pleasure of the Board;

     (2)  The Executive Director shall administer the Plan and manage the day-to-day operations of the Plan, in accordance with policies, procedures, rules, regulations, standards, and criteria established by the Board.  The Executive Director shall also perform such other duties as may be set forth in this Act Chapter, the bylaws, or by the Board.  Except as provided in Section 2-8 1017 of this Act Chapter, the Executive Director shall serve as an ex-officio, non-voting member of the Board;

     (3)  The Executive Director of the Plan shall have a minimum of five years experience in the health finance, or health administration profession; and

     (4)  The Executive Director may, with approval of the Board, delegate to other officers or employees of the Plan, or to a third-party administrator, any of the duties or functions of the Executive Director.

Source:  CSL 2-94-06, 2-15, modified.

      1025.  Corporate Powers.
     In addition to any other authority granted under this Act Chapter, the Plan shall have the capacity to exercise all powers normally exercised by a public corporation, including, but not limited to, the following:

     (1) To adopt, alter, and use a corporate seal;

     (2) To sue and be sued in its corporate name;

     (3) To acquire, in any lawful manner, real, personal or mixed property, either tangible  or intangible; to hold, maintain, use, and operate such property; and to sell, lease, or otherwise dispose of such property;

     (4) To take and otherwise acquire and hold shares, stocks, mortgages, bonds, obligations, securities, and investments of all kinds, foreign and domestic, and to sell or otherwise alienate the same;

     (5) To acquire and take over in any lawful manner the business, property, goodwill, and liabilities of any entity, including debts, liabilities, and obligations incurred prior to the time of acquisition;
 
     (6) To make contracts and incur liabilities, and to borrow or raise any sum or sums of money and issue corporate bonds on such security and upon such terms as may from time to time be deemed necessary for the expansion and improvement of the Plan;

     (7) To lend money for its corporate purposes, and to invest or reinvest its funds;

     (8) To retain and terminate the services of employees, agents, attorneys, auditors, and independent contractors upon such terms and conditions as it may deem appropriate, subject to the provisions of this Act Chapter;

     (9) To conduct its business, carry on its operations, have an office, and to exercise the powers granted herein in any locality of the State, in the Federated States of Micronesia, or in any foreign country; provided that its principal office shall be in the State of Chuuk; and

     (10) To do all such other things as may be deemed incidental or conducive to the fulfillment of the responsibilities of the Plan.

Source:  CSL 2-94-06, 2-16, modified.

      1026.  Regulations.
     The Board shall with the approval of the Governor adopt, amend, or repeal regulations for the administration of the Plan or its successor in State law.  Such regulations shall determine, among other things, assessments for universal coverage, premium amounts, professional service standards, and standards and procedures for referrals, collections, disbursements, and appeals from determinations made in the implementation of the Plan.  The regulations shall further provide for specific notice to enrollees and opportunity to be heard for termination of benefits under the Plan, and shall provide for specific procedures for administrative review and decision on actions taken by the Plan consistent with Section 7-4 1071 of this Act Chapter.

Source:  CSL 2-94-06, 2-17, modified.

Cross-reference:  The constitutional provisions on health are found in Art. X, Sections 6 and 7 of the Chuuk State Constitution.
 
 

Title III. SUBCHAPTER C
Eligibility For Benefits

1030.  Basic Eligibility.
1031.  Agreements for Eligibility of Others.

1030.  Basic Eligibility.
           Every resident of Chuuk State shall be enrolled in and shall be eligible to receive benefits as provided under this Act Chapter, except that unemployed noncitizen residing in the State who are not dependents of enrollees are not eligible, except as provided in Section 3-2 1031 of this Act Chapter.

Source:  CSL 2-94-06, 3-1, modified.

Cross-reference:  The constitutional provisions on health are found in Art. X, Sections 6 and 7 of the Chuuk State Constitution.  Sections 6 and 7 state as follows:

     Section 6.  The State Government shall provide for the protection and promotion of health, and shall ensure, within the limits of its resources, that no person is discriminated against in the distribution of medical care, or is refused medical care because of that person's inability to pay.
     Section 7.  The State Government shall provide for the establishment and administration of a comprehensive system of medical or health insurance which is mandatory for all employed residents of the State of Chuuk while present in the State.  All revenues received under this system of medical or health insurance, and all other revenues received by the Health Department as payment for medicine and medical services, shall be separated from any general fund established by the Legislature and used only for medical purposes.

      1031.  Agreements for Eligibility of Others.
     The Board is authorized to enter into agreements with the National Government, international organizations, or other entities to extend the benefits of this Act Chapter to persons within Chuuk State not otherwise eligible therefor. The Board, in entering into such agreements,  shall be subject to other State laws, regulations, and agreed-upon practices regarding negotiating agreements with non-State entities.

Source:  CSL 2-94-06, 3-2.
 
 

Title IV. SUBCHAPTER D
Nature and Scope of Benefits

1038.  Payment  for Services.
1039.  Medical Referral Committee.
1040.  Supervision.
1041.  Covered Services.
1042.  Benefit Amounts.
1043.  Qualified Providers.
1044.  Universal Coverage.
1045.  Optional Benefits.
1046.  Other Coverage.
1047.  Claims Procedures.

      1038.  Payment for Services.

     (1)  The plan shall pay the benefit amount for any covered service which is furnished to an enrollee by a qualified provider outside of Chuuk State if such covered service is authorized in a referral granted under Section 4-2 1039 of this Act Chapter;

     (2)  The Board may by regulation establish and implement a program for payments of benefit amounts by the Plan for covered services furnished to enrollees by qualified providers within Chuuk State, and for assessment and collection of additional premiums; and

     (3)  The Board by regulation shall establish and implement a program for payments of benefit amounts by the Plan for covered services rendered by the qualified providers to enrollees of the Plan who are outside of Chuuk State.

Source:  CSL 2-94-06, 4-1, modified.

Cross-reference:  The constitutional provisions on health are found in Art. X, Sections 6 and 7 of the Chuuk State Constitution.  Sections 6 and 7 state as follows:

     Section 6.  The State Government shall provide for the protection and promotion of health, and shall ensure, within the limits of its resources, that no person is discriminated against in the distribution of medical care, or is refused medical care because of that person's inability to pay.
     Section 7.  The State Government shall provide for the establishment and administration of a comprehensive system of medical or health insurance which is mandatory for all employed residents of the State of Chuuk while present in the State.  All revenues received under this system of medical or health insurance, and all other revenues received by the Health Department as payment for medicine and medical services, shall be separated from any general fund established by the Legislature and used only for medical purposes.

      1039.  Medical Referral Committee.

     (1)  The Chuuk State Department of Health Services shall establish a medical referral committee, which shall be composed of, at a minimum, three physicians or medical officers who regularly practice in Chuuk State. The Department may appoint to its medical referral committee additional members with such qualifications as it deems appropriate;

     (2)  Except as provided in Subsection (5) of this Section, referrals must be authorized by the Chuuk State medical referral committee.  The Chuuk State medical referral committee shall consider as soon as possible a written request made by an enrollee's attending physician or medical officer and shall determine whether a referral of the enrollee to an out of State health care facility is necessary or appropriate for the diagnosis or treatment of, or rehabilitation following injury or illness, or for health maintenance.  The medical referral committee shall determine in writing:

     (a)  Whether it recommends a referral;

     (b)  Where covered services are to be provided;

     (c)  What covered services are necessary or appropriate for the enrollee to receive at such facility; and

     (d)  The projected length of stay.

     (3)  All recommendations by a medical referral committee or other authorizations for referral as provided under this Section which will result in financial obligations against the Plan must be approved by the Executive Director in accordance with Section 4-4 1041 of this Act Chapter before any financial obligation may be incurred against the Plan for any out of State expenses;

     (4)  The Board shall, in consultation with the Director of the Chuuk State Department of Health Services, by regulation establish standards and procedures for payment of referrals costs, and lists of eligible services and permissible charges that may be imposed against the Plan. Such standards, and procedures and lists shall assure that all referrals services and costs charged to the Plan are consistent with the purposes and the objectives of the Plan;

     (5)  The Director of the Department of Health services shall by regulation provide for alternative means for the authorization of medical referrals in the event of serious and immediate medical emergencies involving situations in which the medial referral committee is unable to meet for the purposes prescribed in Subsection (2) of this Section.

Source:  CSL 2-94-06, 4-2, modified.

      1040.  Supervision.
     The Board by regulation shall establish policies and procedures to supervise the provision of covered services at health care facilities.

Source:  CSL 2-94-06, 4-3, modified.

      1041.  Covered Services.
     Covered services are:

     (1)  Professional services of physicians, dentists, and other health practitioners;

     (2)  Direct services of health institutions;

     (3)  Support services derived from the use of pharmaceuticals, devices, appliances, and other equipment, which the Board by regulation determines are eligible for payment by the Plan;

     (4)  Essential air and sea transportation and ambulatory service to the point of treatment for approved referrals among the islands of Chuuk State and from the State to out of State centers of care;

     (5)  The requisite costs of essential medical attendees and organ donors and of reasonable lodging for out patient care whit authorized by the Plan as provided in its regulations issued pursuant to Section 2-17 1026 of this Act Chapter; and

     (6)  Preventative health care programs sponsored by the Plan on its own initiative or in conjunction with the Chuuk State Department of Health Services.

Source:  CSL 2-94-06, 4-4, modified.

      1042.  Benefit Amounts.
     Benefit amounts are the amounts which the Board, by regulation, determines are eligible to be paid by the Plan.  Said regulations may provide for reasonable amounts of co-payments to be paid by enrollees or other sources for covered services.

Source:  CSL 2-94-06, 4-5.

      1043.  Qualified Providers.
     A qualified provider is a person furnishing any covered service who the Board, by regulation, determines meets the generally accepted standards of the profession or who is licensed in Chuuk State.  The Board shall maintain a list of qualified providers.

Source:  CSL 2-94-06, 4-6.

      1044.  Universal Coverage.
     The Board, by regulation, shall provide for an essential bevel of health coverage to be financed in accordance with Title VIII Subchapter H of this Act Chapter, which coverage shall extend to all eligible enrollees.

Source:  CSL 2-94-06, 4-7, modified.

Cross-reference:  The constitutional provisions on health are found in Art. X, Sections 6 and 7 of the Chuuk State Constitution.

      1045.  Optional Benefits.
     The Board, by regulation, may provide for and offer to enrollees additional benefits, either in the form of covered services in addition to those defined pursuant to Section 4-4 1041 of this Act Chapter or higher benefit amounts than those set pursuant to Section 4-5 1042 of this Act Chapter, an shall provide for payment of additional premiums by or on behalf of enrollees for such benefits.  Notwithstanding the foregoing language of this Section, the Board shall establish and maintain at least one level of optional coverage available to enrollees and their dependents and prescribe the benefits and premiums pertaining thereto.

Source:  CSL 2-94-06, 4-8, modified.

      1046.  Other Coverage.
     The obligations of the Plan to make payment of benefits under this Act Chapter is secondary to the obligation of any other individual or entity to make payment for the same service.  The Board, by regulation, shall establish policies and procedures for the coordination of benefits provided by this Act Chapter and other sources, which policies and procedures shall establish a secondary nature of benefits under this Act Chapter.  Any overpayments of benefits made under this Act Chapter may be recovered by the Plan from any person to or for whom the payment was made or from any company or organization which is obligated to pay for such services.

Source:  CSL 2-94-06, 4-9, modified.

      1047.  Claims Procedures.
     The Board, by regulation, shall establish policies ad procedures for the identification of enrollees by providers, filing of claims, and disbursement of payment for covered services.

Source:  CSL 2-94-06, 4-10.
 
Cross-reference:  The constitutional provisions on health are found in Art. X, Sections 6 and 7 of the Chuuk State Constitution.
 
 

Title V. SUBCHAPTER E
Assessments and Premiums

1050.  Assessment and Premium Amounts.
1051.  Billed Amounts.
1052.  Responsibility for Benefit Offerings.
1053.  Liability for premium payment.
1054.  Supplemental Revenues.
1055.  Premium Collection.
1056.  Sanctions.
1057.  Remedies.

      1050.  Assessment and Premium Amounts.

     (1)  By regulation, the Board shall assess the requisite amounts and sources for universal coverage for essential care in accordance with State law, and shall determine the premium amounts to be charged by the Plan for additional levels of coverage.  The aggregate of all universal coverage payments and premium amounts, along with other sources of income for the Plan,  shall be sufficient to pay all costs of benefits under the Plan, the costs of  administering the Plan, and reasonable reserves for uncollectible debts to the plan and unexpected demands on the plan for payment and other purposes;

     (2)  The Board in its regulations establishing premium amounts, may prescribe differing amounts for enrollees who have no dependents and for enrollees with differing numbers of dependents.

     (3)  The Board, by regulation, may establish additional classifications for enrollees for which different premiums will be determined, based on one or more of the following:

     (a)  Covered services for which the enrollee is eligible or is likely to use;

     (b)  Location;

     (c)  Risk of or exposure to injury or illness; or

     (d)  Other factors normally considered by the health and hospitalization programs and the health maintenance organization industry in the determination of premiums.

Source:  CSL 2-94-06, 5-1.

Cross-reference:  The constitutional provisions on health are found in Art. X, Sections 6 and 7 of the Chuuk State Constitution.  Sections 6 and 7 state as follows:

     Section 6.  The State Government shall provide for the protection and promotion of health, and shall ensure, within the limits of its resources, that no person is discriminated against in the distribution of medical care, or is refused medical care because of that person's inability to pay.
     Section 7.  The State Government shall provide for the establishment and administration of a comprehensive system of medical or health insurance which is mandatory for all employed residents of the State of Chuuk while present in the State.  All revenues received under this system of medical or health insurance, and all other revenues received by the Health Department as payment for medicine and medical services, shall be separated from any general fund established by the Legislature and used only for medical purposes.

      1051.  Billed Amounts.

     (1)  The Board be regulation may, subject to Section 5-4 1053 of this Act Chapter, establish classifications for the portion of the premium amounts to be billed to an enrollee, employer, State Government, National Government or other entity or person.  Such classifications shall be based on one or more of the following:

     (a)  Payments on behalf of the enrollees or employers by a State Government of the Federated States of Micronesia, the National Government, the Government of the United States of America, or any other source;

     (b)  Time of payment; and

     (c)  Any other factor reasonably related to the purposes of this Act Chapter.

     (2)  The Plan shall bill the amounts determined under this Section.

Source:  CSL 2-94-06, 5-2.

      1052.  Responsibility for Benefit Offerings.

     (1)  All employers shall offer to their employees the opportunity to accept first level optional coverage as prescribed by Section 4-8 1045 of this Act Chapter;

     (2)  Employers may at their discretion offer to their employees additional coverage beyond the first level of optional coverage; and

     (3)  Notwithstanding Subsections (1) and (2) of this Section, enrollees who are not employed and enrollees desiring additional coverage beyond the first level when it is not offered by the employer, may attain such coverage by making full payment of the premium to the Plan in the manner prescribed by Section 5-4 1053(4) of this Act Chapter.

Source:  CSL 2-94-06, 5-3, modified.

      1053.  Liability for premium payment.

     (1)  An employer of an enrollee with respect to whom a premium amount is billed shall be responsible for payment of one-half of such premium amount.  The employer may, by written agreement filed with the Plan, assume responsibility to pay more than one-half of the premium amount;

     (2)  The employer shall collect the balance of the premium by deducting and withholding such amount from the enrollee's compensation with respect to pay periods as specified by the Board's regulation.  Every employer required to deduct and withhold a premium amount shall be liable for the payment of such amount as well as the employer's share of the premium amount and shall pay such premium amounts to the Plan with reports or returns as specified by the Board by regulation;

     (3)  The Board by regulation shall establish policies and procedures to equitably allocate the employer's portion of the premium amount among employers if an enrollee is employed by more than one employer during a premium payment period; and

     (4)  Any person required to pay a premium amount for whom a collection procedures is not otherwise provided in this Act Chapter or the regulations shall pay such premium amount of the Plan with report or returns as specified by the Board.

Source:  CSL 2-94-06, 5-4.

      1054.  Supplemental Revenues.
     The Plan shall seek appropriations from the Chuuk State Legislature, the National Congress and from other sources, for such additional revenues as it is reasonably anticipated will be necessary to compensate for any reduction the total amount of assessments and premiums collected or that are otherwise deemed to be beneficial to the financial status of this Plan.

Source:  CSL 2-94-06, 5-5, modified.

      1055.  Premium Collection.
     The Board by regulation shall establish and implement procedures to regularly collect premium amounts from government appropriations, enrollees, employers and other sources.

Source:  CSL 2-94-06, 5-6.

      1056.  Sanctions.

     (1)  If any premium amount imposed by this Act Chapter or regulations is not paid by an employer or enrollee on or before the date prescribed for such payment, there shall be collected, in addition to such premium amount and penalties, interest on the unpaid balance of the premium amount at the rate of 10 percent per annum from its due date until the date it is paid;

     (2)  An employer who has failed to make premium payments when required under this Act Chapter shall be liable to the Plan for the reasonable coasts incurred by the Plan and/or employee or covered dependent(s) for medical services required by the employee or covered dependent(s); provided, that such liability shall not exceed the costs of such services allowable under the Plan at the level for which the premiums were to be made; and

     (3)  Any employer found to carry on any employment practice directly or indirectly designed to discourage or prevent employees from exercising the option to accept the first level of voluntary coverage shall be subject to a penalty of not more than ten times the amount due to the Plan by the employer for each employee so affected by such practice. Receipts from the penalty shall first go to payment of the affected employees' premium payments.  The remainder shall be deposited in the Trust Fund of the Plan as the realization of general revenue.

Source:  CSL 2-94-06, 5-7, modified.

      1057.  Remedies.

     (1)  The Board is authorized to take civil action and impose liens, if necessary, to collect overdue premiums or any amount imposed or authorized under this Act Chapter; and

     (2)  If any person liable to pay any amount under this Act Chapter neglects or refuses to pay the same after demand, the amount including any fine or interest assessed pursuant to Section 5-7 1056 of this Act Chapter, together with any costs that may accrue in addition thereto shall be a lien in favor of the Plan upon all property and rights to property, whether real or personal, belonging to such person and may be collected by levy upon such property in the same manner as the levy of an execution.

Source:  CSL 2-94-06, 5-8, modified.

Cross-reference:  The constitutional provisions on health are found in Art. X, Sections 6 and 7 of the Chuuk State Constitution.
 
 

Title VI. SUBCHAPTER F
Trust Fund

1060.  Remedies.
1061.  Management of Fund.
1062.  Authorization.

      1060.  Remedies.
     The Board shall establish a Trust Fund, which shall be administered exclusively for the purpose of this Act Chapter.  All payments or benefits under this Act Chapter shall be paid from the Fund.  The Fund shall consist of:

     (1)  All assessments for universal coverage as provided under this Act Chapter;

     (2)  All premiums collected from enrollees and employers;

     (3)  All money received as subsidies to the Plan from the Chuuk State Government, the National Government, or any other source for payment to the Fund; and

     (4)  All co-payments, fines, penalties and interest payments collected pursuant to this Act Chapter.

Source:  CSL 2-94-06, 6-1, modified.

Cross-reference:  The constitutional provisions on health are found in Art. X, Sections 6 and 7 of the Chuuk State Constitution.  Sections 6 and 7 state as follows:

     Section 6.  The State Government shall provide for the protection and promotion of health, and shall ensure, within the limits of its resources, that no person is discriminated against in the distribution of medical care, or is refused medical care because of that person's inability to pay.
     Section 7.  The State Government shall provide for the establishment and administration of a comprehensive system of medical or health insurance which is mandatory for all employed residents of the State of Chuuk while present in the State.  All revenues received under this system of medical or health insurance, and all other revenues received by the Health Department as payment for medicine and medical services, shall be separated from any general fund established by the Legislature and used only for medical purposes.

      1061.  Management of Fund.
     The Executive Director shall be the custodian of the Fund and shall administer the Fund in accordance with the rules and regulations established by the Board.  All monies in the Fund shall be held in trust solely for the purposes of this Act Chapter.  With the approval and under the direction of the Board, the Executive Director may, from time to time, invest such monies in the Fund as are in excess of the amount deemed necessary for a reasonable future period.  The investments shall at all times be so made that all the assets of the fund shall be readily convertible into cash when needed for the purposes of this Act Chapter.

Source:  CSL 2-94-06, 6-2, modified.

      1062.  Authorization.
     There is hereby authorized for appropriation such sums from such Fund of the Chuuk State Treasury as may be determined annually to pay assessments required thereof by Section 5-1 1050 of this Act Chapter and to assist in the financing of the Trust Fund to be established pursuant to Section 6-1 1060 of this Act Chapter.  All sums appropriated shall remain available until fully expended.

Source:  CSL 2-94-06, 6-3, modified.

Cross-reference:  The constitutional provisions on health are found in Art. X, Sections 6 and 7 of the Chuuk State Constitution.
 
 

Title VII. SUBCHAPTER G
Administration

1068.  Consultation Requirements.
1069.  Fiscal and Operational Integrity.
1070.  Third-party Administrators and Consultants.
1071.  Determination and appeals.
1072.  Budget Preparation.
1073.  Tax Exemption.
1074.  Corporate Debts and Obligations.
1075.  Immunity from Liability.
1076.  Records and Reporting.

      1068.  Consultation Requirements.
     The Board shall establish appropriate measures to assure that it consults with enrollees and providers on a regular basis and is advised of the impact of its policies and procedures on such individuals.

Source:  CSL 2-94-06, 7-1.

Cross-reference:  The constitutional provisions on health are found in Art. X, Sections 6 and 7 of the Chuuk State Constitution.

      1069.  Fiscal and Operational Integrity.
     The Board shall take all measures necessary to assure the fiscal and operational integrity of the Plan and shall review the Plan no less often than quarterly for such purposes.  Review shall include utilization reviews, reviews of financial statements, reviews of premium and benefit schedules, and reviews of operational policies and procedures.  In particular, the Board shall take all measures necessary to assure that:

     (1)  Its policies and procedures support the health care objectives of Chuuk State;

     (2)  Payments for benefits do not exceed revenues to the fund; and

     (3)  Only payments for benefits which the Plan is obligated to provide are made.

Source:  CSL 2-94-06, 7-2, modified.

      1070.  Third-party Administrators and Consultants.
     The Board may retain the services of third-party administrators or qualified health care or business consultants, as it deems necessary for the successful operation of the Plan.
 
Source:  CSL 2-94-06, 7-3.
 
      1071.  Determination and appeals.
     Except as otherwise provided in this act Chapter, determinations of eligibility, covered services, qualified providers, benefit amount, premium amounts to be billed, and all other matters arising in the implementation of the Plan shall be made by the Executive Director may be made to the Board in accordance with procedures specified in the regulations.

Source:  CSL 2-94-06, 7-4, modified.

      1072.  Budget Preparation.

     (1)  The Executive Director shall prepare in advance of each fiscal year an annual budget for the Plan, taking into consideration anticipated capital and operating expenditures and anticipated revenues.  The Plan shall use the same fiscal year as that of the Chuuk State Government. The budget shall indicate the operating capital, and maintenance requirements  of the Plan that will be met with anticipated revenues of the Plan, and such essential requirements as cannot be met without increase in revenues of outside financial assistance.  The annual budget shall be reviewed and approved by the Board; and

     (2)  The estimated administrative costs budgeted for any fiscal year of the Plan shall not exceed an expenditure maximum equal to ten percent of the Plan's estimated income for such year.  For purposes of this Section, "administrative costs" include the costs of salaries and wages, maintenance of branch offices, patient and physician care coordination, third-party administrator contractual service fees, office supplies and equipment, as well as actuarial, auditing, legal, computer, financial management, accounting, and similar services.  For purposes of this Section, "income" includes universal coverage payments made, premiums collected, investment income, fines, penalties and interest collected.  "Income" also includes such subsidiary funds received from the Chuuk State Government, the National Government, or any other sources for payment to the Fund that are not allocated to any particular or specific use or category of expenditures; provided that the specific approval of the Board must be obtained for any budgeted administrative cost from such particular or special use of category funds in excess of the expenditure maximum prescribed in this Section.

Source:  CSL 2-94-06, 7-5, modified.

      1073.  Tax Exemption.
     The plan shall exist and operate solely for the benefit of the public and shall to the extent allowed by law be exempt from any taxes or assessments on any of its property, operations, or activities.  Nothing herein shall be deemed to exempt employees and independent contractors of the plan from tax liability for income received from the plan.

Source:  CSL 2-94-06, 7-6.

      1074.  Corporate Debts and Obligations.
     Unless otherwise expressly provided by law, the Chuuk State Government shall not be liable or responsible for any debts or obligations of the Plan.

Source:  CSL 2-94-06, 7-7, modified.

      1075.  Immunity from Liability.
     The Plan and officers, employees and Board members of the Plan shall be immune from liability for acts or omissions with respect to service for the Plan to the same extent as the Chuuk State Government and officers, directing boards and employees of the Chuuk State Government with respect to Government service.

Source:  CSL 2-94-06, 7-8, modified.

      1076.  Records and Reporting.

     (1)  The Executive Director shall keep accurate records of the Plan's business transactions.  Such records shall include, but not be limited to, accounting of all income and expenditures, assets (both tangible and intangible), and liabilities of the Plan.  The Executive Director shall prepare and submit to the Board a monthly report, which shall include the monthly financial report.  The Board, not later than 90 days after the close of each fiscal year, shall submit to the Governor and the Chuuk State Legislature, a complete report showing the activities of the Plan during the fiscal year, the present financial condition of the Plan, and such other matters as the Board shall deem appropriate;

     (2)  The personal records of the Plan shall be confidential.  No officer, employee, or Board member of the Plan shall disclose any personal records obtained by him in any manner in connection with his service as such officer, employee, or Board member, or otherwise.  For purposes of this Section, the term "officer, employee, or Board member" includes a former officer, employee or Board member.  "Personal records" means any records concerning any individual enrollee or employer;

     (3)  The books of account of the Plan shall be audited by the Chuuk State Public Auditor annually.

Source:  CSL 2-94-06, 7-9, modified.

Cross-reference:  The constitutional provisions on health are found in Art. X, Sections 6 and 7 of the Chuuk State Constitution.
 
 
 

Title VIII. SUBCHAPTER H
Support for the Essential Level
of Health Insurance Coverage

1080.  Intent.
1081.  Financing.
1082.  Health Care Premium Fund.
1083.  Appropriation Requests.
1084.  Authorization.
1085.  Review.

      1080.  Intent.
     The Chuuk State Legislature is of the mind that all persons eligible for enrollment in the Plan will in fact be enrolled.  To this end, the Chuuk State Legislature anticipates creating a source of public financing, which along with other mandated sources of financing, will ensure that all such persons are accorded the essential level coverage under the Plan.

Source:  CSL 2-94-06, 8-1, modified.

Cross-reference:  The constitutional provisions on health are found in Art. X, Sections 6 and 7 of the Chuuk State Constitution.  Sections 6 and 7 state as follows:

     Section 6.  The State Government shall provide for the protection and promotion of health, and shall ensure, within the limits of its resources, that no person is discriminated against in the distribution of medical care, or is refused medical care because of that person's inability to pay.
     Section 7.  The State Government shall provide for the establishment and administration of a comprehensive system of medical or health insurance which is mandatory for all employed residents of the State of Chuuk while present in the State.  All revenues received under this system of medical or health insurance, and all other revenues received by the Health Department as payment for medicine and medical services, shall be separated from any general fund established by the Legislature and used only for medical purposes.

      1081.  Financing.
     Not later than July 1, 1994, the Board of the Plan shall submit to the Legislature a detailed proposal for the financing of the essential level of coverage under the Plan.  Such proposal shall include the sources, levels and expected revenues to be collected and shall include such draft legislation to amend this Title Chapter as the Plan deems necessary to secure financing.

Source:  CSL 2-94-06, 8-2, modified.

      1082.  Health Care Premium Fund.
     There is hereby created within the Chuuk State Treasury a Health Care Premium Fund to which all collections imposed by this Title Chapter, along with all civil penalties and interest with respect thereto, shall be deposited.

Source:  CSL 2-94-06, 8-3, modified.

      1083.  Appropriation Requests.
     The Plan shall, following consultation with appropriate officials of the State and National Governments, present an annual request to the Chuuk State Legislature for appropriation from the Fund to provide the State Government's share of payments necessary to finance the essential level of health care coverage for all eligible enrollees.  Such request shall include information as to the level of support being requested of the National Government and other sources for financing the essential level of coverage provided by the Plan.

Source:  CSL 2-94-06, 8-4, modified.

      1084.  Authorization.
     There is hereby authorized for appropriation from the Health Care Premium Fund such amounts as may be determined annually in the Comprehensive Budget Act for the sole purpose of assisting in the financing of an essential level of health care coverage for all persons eligible therefor under this act Chapter. Sums so appropriated shall be administered and expended by the Plan in accordance with this act Chapter and shall remain available until fully expended.

Source:  CSL 2-94-06, 8-5, modified.

      1085.  Review.
     The Plan shall periodically undertake a comprehensive review of the financial demands of maintaining an essential level of health care coverage as provided by this act Chapter and the revenue generation capacities of this Title Chapter along with National Government assistance and other means of support for this coverage; and shall thereafter make recommendations to the Chuuk State Legislature as to modifications to the financing systems of this Title Chapter and other methods and sources of support.

Source:  CSL 2-94-06, 8-6, modified.

Cross-reference:  The constitutional provisions on health are found in Art. X, Sections 6 and 7 of the Chuuk State Constitution.
 
 
 

Title IX.  SUBCHAPTER I
Government Assistance

1090.  Government Assistance to the Plan.
1091.  Initial Administration.
1092.  Authorization for Initial Financing.

      1090.  Government Assistance to the Plan.
     For the purpose of planning, undertaking and carrying out the provisions of this Act Chapter and the subsequent operation of the Plan established hereunder, and where permissible under law, the Chuuk State Government, or any agency or political subdivision thereof, may if the Chief Executive Officer of the respective Governmental Branch or political subdivision determines that the project is of importance and benefit to that branch or political subdivision and be of advantage to the people of this State:

     (1)  Dedicate, sell, convey or lease interests in real or personal properties, rights or privileges that it may have to the Plan;

     (2)  Incur expenses on behalf of the plan subject to reimbursement under such conditions as may be agreed upon with the Board of the Plan;

     (3)  Do any and all things necessary to aid or cooperate in the planning or carrying out the duties, powers and obligations of the Plan;

     (4)  Lend, advance, grant or contribute funds to the Plan and provide for or waive the repayment of any such funds loaned or advanced; and

     (5)   Contract with or furnish services to the Plan upon conditions and terms as may be agreed upon.

Source:  CSL 2-94-06, 9-1, modified.

Cross-reference:  The constitutional provisions on health are found in Art. X, Sections 6 and 7 of the Chuuk State Constitution.  Sections 6 and 7 state as follows:

     Section 6.  The State Government shall provide for the protection and promotion of health, and shall ensure, within the limits of its resources, that no person is discriminated against in the distribution of medical care, or is refused medical care because of that person's inability to pay.
     Section 7.  The State Government shall provide for the establishment and administration of a comprehensive system of medical or health insurance which is mandatory for all employed residents of the State of Chuuk while present in the State.  All revenues received under this system of medical or health insurance, and all other revenues received by the Health Department as payment for medicine and medical services, shall be separated from any general fund established by the Legislature and used only for medical purposes.

      1091.  Initial Administration.
     In addition to such assistance as may be provided under Section 9-1 1090 of this Title Chapter, the Governor shall provide the initial Board of Trustees appointed under this act Chapter with office space and administrative assistance for the first 12 twelve months of its operations, unless such space and assistance is otherwise acquired by the Board.

Source:  CSL 2-94-06, 9-2, modified.

      1092.  Authorization for Initial Financing.
     There is hereby authorized for appropriation from the General Fund of the Chuuk State Treasury the sum of $10,000, or so much thereof as may be appropriated and necessary for the start-up and initial administration of the Plan established by this act Chapter, for the development of the detailed proposal for the financing of the Plan as required by Section 8-2 1081 of this act Chapter, and for the complete review of the contents of this statute as required by Section 10-1 1098 of this Act Chapter.  Prior to the organization of the first Board of Trustees of the Plan under this Act Chapter, not more than 35 percent of the monies appropriated under the authorization of this Section may be administered and expended by the Governor solely for the purposes specified in this Section.  Following the organization of the Board, the Governor shall cause the remainder of monies appropriated hereunder and not expended or obligated for expenditure by the Governor to be deposited in the Trust Fund established by the Board pursuant to Section 6-1 1060 of this Act Chapter.  Monies so deposited in the Trust Fund may only be expended by the Plan for the purposes specified in this Section, and shall remain available therein until fully expended. The Board, in its annual report to the Governor and the Legislature as provided by Section 7-9 1076 of this Act Chapter, shall provide a full accounting of the use of monies appropriated under the authorization of this Section, inclusive of such uses and expenditures by the Office of the Governor prior to the transfer of the appropriation to the Trust Fund.

Source:  CSL 2-94-06, 9-3, modified.

Cross-reference:  The constitutional provisions on health are found in Art. X, Sections 6 and 7 of the Chuuk State Constitution.
 
 
 

Title X. SUBCHAPTER J
Effective Date

1098.  Effective Date.

      1098.  Effective Date.
     This Act Chapter shall take effect upon the approval of the Governor, or upon its becoming law without such approval; provided, however, that no level of coverage may be extended, no mandatory premiums may be imposed, nor obligation to provide benefits deriving therefrom may be undertaken prior to the enactment of a financing system for coverage of persons under the essential level of care pursuant to Title VII Subchapter G of this act Chapter; provided further, that in addition to the requirements of Section 8-2 1081 of this act Chapter, the Board of the Plan shall within six months following its initial organization, conduct a complete review of the contents of this act Chapter and shall thereafter present to the Legislature a full report as to its proposed implementation of the Plan along with such draft legislation as the Board deems necessary to amend this act Chapter to fully realize the purpose of this act Chapter and to ensure compliance of the Plan with all existing laws and regulations.

Source:  CSL 2-94-06, 10-1, modified.

Cross-reference:  The constitutional provisions on health are found in Art. X, Sections 6 and 7 of the Chuuk State Constitution.

Editor's note:  CSL 2-94-06 was signed into law by the Governor on April 24, 1994.