Health care plans operated by cooperative associations

2. The bill specifies that establishing and maintaining these plans may be the primary, as opposed to exclusive, purpose of the cooperative association.

3. Current law provides that cooperative associations may enter into contracts for services with physicians and surgeons, optometrists, chiropractors, and dentists.

The bill allows contracts with other providers, too.

4. The bill adds that nothing in the provisions pertaining to the purpose of the cooperative association as being primarily to establish and operate a health care plan precludes a cooperative association from owning an interest in other entities for improving member services or for investment.

5. Under current law, a cooperative association may not spend more than 5 percent of capital stock or membership fees on promotional expenses. The bill provides that this limit does not apply to a cooperative association operating a health care plan.

6. Current law prohibits a contract by or on behalf of a cooperative association from providing for the payment of cash or other material benefit to a subscriber or the subscriber's estate on account of death, illness, or injury. The bill eliminates this provision.

7. Under current law, a cooperative association may stipulate in a plan that it will pay a nonparticipating physician and surgeon, optometrist, chiropractor, or dentist outside of the cooperative association's normal territory for care rendered to a member or a member's covered dependent who needs the care when he or she is outside the cooperative association's territory in which the plan benefits are normally available. Under the bill, a cooperative association may stipulate in its plans that it will pay a nonparticipating physician and surgeon, optometrist, chiropractor, dentist, or other provider for health care rendered to a covered person, without limitation to being outside the association's normal territory.

8. Current law provides that a cooperative association may provide benefits only to its members. The bill allows a cooperative association to offer its services to nonmembers, too.

9. Finally, the bill makes various technical changes, such as conforming the language to current statutory drafting practice and eliminating redundant provisions.