Issuance of certificate of authority by commissioner for cooperative to purchase health-care coverage

(1) (a) (I) (A) On and after August 4, 2004, an unlicensed cooperative conducting business pursuant to this part 10 shall file an application with the commissioner for issuance of a certificate of authority to purchase health-care coverage for members and their eligible employees. An application shall include the following information: The name of the cooperative and any agent for service of process; details concerning provisions to govern the business and affairs of the cooperative, including management and organizational structure; an affidavit signed under oath by an officer of the organization that the cooperative is in compliance with sections 10-16-1004 (2)(c) and 10-16-1008 (3); and the names of managing personnel of the cooperative. The commissioner shall grant a certificate of authority to an applicant under this section unless the application fails to comply with this part 10. The commissioner shall establish an application filing fee, not to exceed one thousand one hundred dollars, to recover the direct costs of the commissioner in conducting the review required by this section. Each cooperative issued a certificate of authority pursuant to this section shall annually submit such information as the commissioner may reasonably require to determine that a cooperative continues to be in compliance with the provisions of this part 10. The commissioner shall establish a fee, not to exceed one thousand one hundred dollars annually, to recover the direct costs of the commissioner in determining annually that a cooperative is in compliance with the provisions of this part 10.

(B) Except as provided in section 10-16-1004 (3)(b), no cooperative shall take any action enumerated in section 10-16-1009 unless a certificate of authority has been issued pursuant to this section by the commissioner. Any person or entity applying to obtain a certificate of authority as required by section 10-16-1004 (2)(b) that fails to obtain a certificate of authority by December 1, 2004, shall cease to engage in any activity for which a certificate of authority is required pursuant to this part 10 until a certificate of authority is issued by the commissioner pursuant to this section and section 10-16-1006.

(C) Cooperatives that have been issued a certificate of authority by the executive director of the department of health care policy and financing prior to August 4, 2004, shall submit proof of such certificate of authority to the commissioner prior to November 1, 2004. The commissioner shall reissue a certificate of authority to the cooperative on or before December 1, 2004.

(II) A cooperative shall be required to post a fidelity or employee dishonesty bond or deposit with the commissioner a certificate of deposit or securities in a minimum amount equal to at least two months' premiums held by the cooperative or its administrator as of its annual renewal date in order to be granted a certificate of authority under this section. If a cooperative contracts with an outside administrator for all premium-handling functions, the cooperative itself will not be required to post a bond in order to comply with the provisions of this subparagraph

(II) so long as the cooperative submits to the commissioner evidence that such administrator has obtained a bond in the required amount.