Self-Insured Health Care Providers
Eligibility for Self-Insurance Any health care provider or health care system that wants to become self-insured must meet the eligibility criteria prescribed in K.S.A. 40-3414 and amendments thereto.
Application for Certificate of Self-Insurance A health care provider that wants to become self-insured must submit a letter of intent to the Board at least six months prior to the date when the health care provider wants to become self-insured. If the health care provider is an individual professional, the letter must be signed by the health care provider. If the health care provider is a partnership, the letter must be signed by all partners. If the health care provider is a medical care facility or health care system, the letter must be signed by the legal representative of the governing authority. If the health care provider is a corporation or a limited liability company, the letter must be signed by the chairperson of the board of directors.
Within 60 days of the letter of intent to become self insured, the health care provider must submit to the Board the following information:
(1) a copy of the health care provider's most recent audited financial statement;
(2) a description of the health care provider's financial condition including any material changes after the most recent audited financial statement;
(3) a copy of the minutes of the meeting of the governing authority which reflects approval of the creation of a separate segregated fund for payment of claims, or a copy of a resolution adopted by the governing authority authorizing creation of a separate segregated fund for payment of claims;
(4) a statement of the amount of liquid assets to be reserved for settlement of claims or payment of judgments against the health care provider; and
(5) a description of the procedures that will be used by the health care provider in the event a claim is filed against the health care provider including: (a) the method of reporting claims to the Board of Governors; (b) the positions and names of individuals responsible for reporting claims to the Board of Governors; and (c) the methods that will be used by the health care provider to investigate and evaluate claims.
Within 90 days of the letter of intent to become self insured, the health care provider must submit to the Board the following information:
(1) a history of claims for the previous five years identifying paid losses for closed claims and loss reserves for open claims;
(2) an independent actuary's report indicating recommended reserves for self insurance of the health care provider including reserves for prior acts; and
(3) a copy of the liability insurance policy or declarations page providing insurance coverage for employees who are not health care providers, or an explanation of separate self insured coverage independent of the self-insurance of health care providers.
Quarterly Reports of Reserves A self-insured health care provider must submit a statement every three months which reports the current balance in the segregated fund established for payment of claims.
Notice of Material Change If a self insured health care provider experiences a material change in its ownership, financial condition, or procedures for handling self-insured professional liability claims, the health care provider must notify the Board of the material change within 30 days of knowledge of the change.
Renewal of Certificate of Self Insurance A self-insured health care provider must annually resubmit updated information described above (except for the letter of intent) in order to maintain continuous self-insured status.
Revocation of Certificate of Self Insurance The Board may revoke a certificate of self insurance for:
(1) failure to pay the premium surcharge required by subsection (c) of K.S.A. 40-3402 and amendments thereto;
(2) failure to submit quarterly statements of reserves;
(3) failure to annually resubmit the required information described above; or
(4) a change in the ownership, financial condition, or procedures for handling claims.
If you have any questions contact Lorie Anderson at 785-291-3475. The "Self -Insurance Certificate Application and Instructions" may be downloaded from the forms page.
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