EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted. Green numbers along left margin indicate location on the printed bill (e.g., 5-15 indicates page 5, line 15).

1-1 Section 1. NRS 695C.055 is hereby amended to read as follows:

1-2 695C.055 1. The provisions of NRS 449.465, 679B.158, subsections

1-12 do not apply to the County Health System.

1-13 Sec. 2. NRS 695C.060 is hereby amended to read as follows:

1-14 695C.060 1. [Any] The County Health System established by

1-17 maintenance organization in compliance with this chapter. No person

2-1 [shall] may operate a health maintenance organization without obtaining a

2-2 certificate of authority under this chapter. A foreign corporation may

2-3 qualify under this chapter, subject to its qualification to do business in this

2-4 state as a foreign corporation.

2-5 2. No person [shall] may be certified to establish or operate a health

2-6 maintenance organization in this state, nor sell or offer to sell, or solicit

2-7 offers to purchase or receive advance or periodic consideration in

2-8 conjunction with health care plans unless [such] the health maintenance

2-9 organization provides or arranges for the provision of comprehensive

2-10 health care services.

2-11 3. Every health maintenance organization or person operating a health

2-12 maintenance organization shall submit an application for a certificate of

2-13 authority under NRS 695C.070 within 30 days after July 1, 1973. Each

2-14 such applicant may continue to operate until the commissioner acts upon

2-15 the application. [In the event that] If an application is denied under NRS

2-16 695C.090 and 695C.100, the applicant [shall] must thereafter be treated as

2-17 a health maintenance organization whose certificate of authority has been

2-18 revoked. For purposes of this subsection, a health maintenance organization

2-19 shall be deemed to be in operation only if health care services are being

2-20 provided to the public generally or to some group or groups thereof.

2-21 Sec. 3. NRS 41.0305 is hereby amended to read as follows:

2-22 41.0305 As used in NRS 41.0305 to 41.039, inclusive, the term

2-31 function, even though it does not exercise general governmental powers.

2-32 Sec. 4. The legislature finds and declares that the combination of

2-33 public needs and available resources for the provision of medical care to

2-34 patients uninsured or receiving public assistance in Clark County, the

2-35 state’s largest metropolitan area, and the lack of functioning precedents for

2-36 a unified system for this purpose, are unique to that county and that a

2-37 general law cannot be made applicable to the unified provision of that care.

2-38 Sec. 5. As used in sections 5 to 26, inclusive, of this act, unless the

2-39 context otherwise requires:

2-40 1. "Board" means the board of directors of the system.

2-41 2. "Department" means the department of human resources.

2-42 3. "Director" means the person appointed pursuant to section 14 of this

2-43 act.

3-1 4. "Division of insurance" means the division of insurance of the

3-2 department of business and industry.

3-3 5. "Program" means the program of services provided by the system.

3-4 6. "System" means the County Health System.

3-5 Sec. 6. 1. The County Health System is hereby created as a nonprofit

3-6 public corporation to serve a municipal and charitable purpose. The system

3-7 shall be deemed to be a local government for the purpose of eligibility for

3-8 any federal benefit related to the purposes of the system.

3-9 2. The board of county commissioners of Clark County, as hospital

3-10 trustees ex officio, shall appoint the board of directors of the corporation,

3-11 consisting of seven members nominated by the board of county

3-12 commissioners and two members nominated by the governor. Vacancies on

3-13 the board of directors must be filled in the same manner as the initial

3-14 appointments.

3-15 Sec. 7. 1. The nominees to serve as directors must reside or be

3-16 employed in Clark County and be broadly representative of the cities and

3-17 towns of the county and experienced in business or community affairs. A

3-18 director may not be an elected officer or an employee of the county, a

3-19 provider of health care or an employee of a provider of health care.

3-20 2. Except for the initial allotted terms of 1 year, the members of the

3-21 board shall serve for terms of 2 years. The members first appointed shall

3-22 choose by lot, at their first meeting, four members to serve for terms of 1

3-23 year.

3-24 Sec. 8. 1. The board shall hold at least six regular meetings each

3-25 year.

3-26 2. The board shall adopt rules for its proceedings. A majority of the

3-27 members constitutes a quorum, but the approval of an official act requires

3-28 four affirmative votes unless the number of members prohibited by conflict

3-29 of interest from voting reduces the number of members eligible to vote to

3-30 fewer than four, in which case approval of the official act requires

3-31 affirmative votes of all members eligible to vote on the matter.

3-32 3. Each member of the board is entitled to receive from the system $80

3-33 for each meeting of the board he attends, and the board may provide the

3-34 same remuneration for attendance at meetings of committees of the board,

3-35 but the total for all meetings attended in a calendar month may not exceed

3-36 $320. In addition, a member is entitled to reimbursement for actual and

3-37 necessary expenses for attending meetings, at the rate payable to county

3-38 officers and employees generally.

3-39 Sec. 9. 1. The board shall remove a member from office if a majority

3-40 of the other members find that he:

3-41 (a) Neither lives nor is employed in Clark County;

3-42 (b) Has been convicted of a felony;

4-1 (c) Has failed to attend three consecutive meetings of the board or a

4-2 majority of the meetings of the board held in the most recent calendar year,

4-3 unless good cause is shown, as determined by the board; or

4-4 (d) Has failed to perform his duties as a member of the board.

4-5 2. The board shall remove a member from office at the written request

4-6 of the governor or the board of county commissioners of Clark County,

4-7 whichever nominated the member, if the request sets forth the manner in

4-8 which he no longer meets the criteria for his nomination.

4-9 Sec. 10. The system may:

4-10 1. Operate as a health maintenance organization pursuant to the

4-11 provisions of chapter 695C of NRS;

4-12 2. Enter into agreements with public agencies to provide health care for

4-13 which the public agency is otherwise responsible;

4-14 3. Enter into agreements with private persons to provide health care for

4-15 which the system is responsible;

4-16 4. Acquire or dispose of any interest in real or personal property;

4-17 5. Borrow money from, otherwise become obligated to or accept

4-18 contributions, grants or other financial assistance from any person,

4-19 government or governmental agency for costs incurred in developing its

4-20 program of services and expenses incurred or anticipated in operating the

4-21 program;

4-22 6. Employ persons or contract for services required for the

4-23 performance of its duties; and

4-24 7. Sue or be sued.

4-25 Sec. 11. The system may, to the extent permitted by federal law, enter

4-26 into agreements to provide or arrange for the provision of health care, for

4-27 compensation, to persons who are uninsured or are eligible for benefits:

4-28 1. Under Medicaid or the program established pursuant to 42 U.S.C.

4-29 children from low-income families in this state; or

4-30 2. From the county under the provisions of chapter 428 of NRS for the

4-31 medically indigent.

4-32 Sec. 12. 1. Except as otherwise provided in this section, the system

4-33 may apply through the department for all waivers from federal regulation

4-34 and all approvals from the Federal Government which are necessary to

4-35 establish and operate its program of services, including a demonstration

4-36 project pursuant to 42 U.S.C. § 1315. The demonstration project may not

4-37 be used to curtail any existing rights of persons receiving Medicaid at the

4-38 time of the application.

4-39 2. An application for a waiver or approval may include providing

4-40 services pursuant to Medicaid through the program to persons who

4-41 otherwise would not receive medical assistance pursuant to Medicaid.

5-1 3. The system shall not apply for a waiver of the provisions concerning

5-2 payment to federally qualified health centers or noninstitutional providers

5-3 of health care pursuant to 42 U.S.C. § 1396(a)(10), (13), (30) or (37). As

5-4 used in this subsection, federally qualified health center has the meaning

5-5 ascribed to it in paragraph (a) of subsection 4 of NRS 422.273.

5-6 Sec. 13. 1. The county comptroller of Clark County, at least annually

5-7 and oftener if he deems it appropriate, shall review the financial condition

5-8 of the system, report his findings to the board of directors of the system and

5-9 the board of county commissioners of Clark County, and provide a copy of

5-10 his findings to any other public agency upon request. The county

5-11 comptroller may direct that other operation or financial audits of the system

5-12 be made.

5-13 2. Upon written request of the county comptroller, the system shall

5-14 provide full access to all its records and documents for the purpose of the

5-15 review and audits required by this section.

5-16 3. Clark County is not liable for any damage or loss resulting from an

5-17 act or omission of the county comptroller pursuant to this section, or from

5-18 the reliance of any person upon his findings.

5-19 Sec. 14. 1. The board shall appoint a director to manage the program

5-20 of services of the system. The person appointed must have experience in

5-21 the management of a similar program.

5-22 2. The director is responsible to the board and serves at the pleasure of

5-23 the board. He shall:

5-24 (a) Attend all meetings of the board and serve as its secretary, keeping

5-25 or causing to be kept minutes of its proceedings;

5-26 (b) Report regularly to the board concerning the administration of the

5-27 program;

5-28 (c) Report annually, and make such special reports as he considers

5-29 advisable, to the board of county commissioners of Clark County

5-30 concerning the work of the board of directors of the system;

5-31 (d) Direct and supervise all of the technical and administrative activities

5-32 of the system; and

5-33 (e) Coordinate the activities of the system with the personnel and

5-34 agencies of Clark County.

5-35 Sec. 15. 1. The board shall establish an advisory board of providers

5-36 of health care to furnish technical expertise and advice.

5-37 2. The advisory board must include the following members nominated

5-38 as set forth in this subsection and confirmed by a two-thirds vote of the

5-39 board:

5-40 (a) A hospital administrator nominated by the Nevada Association of

5-41 Hospitals and Health Systems;

5-42 (b) An administrator of a health maintenance organization nominated by

5-43 the Nevada Association of Health Maintenance Organizations;

6-1 (c) A physician nominated by the Clark County Medical Society;

6-2 (d) A representative of community health clinics nominated by the

6-3 director of community health clinics in Clark County;

6-4 (e) A pharmacist nominated by an association of pharmacists in Clark

6-5 County;

6-6 (f) A representative nominated by the Home Health Care Association of

6-7 Nevada; and

6-8 (g) A registered nurse nominated by the Nevada Nurses Association.

6-9 3. The board may appoint additional members. If any of the

6-10 organizations named in subsection 2 ceases to exist, the board shall

6-11 designate a successor nominating organization.

6-12 Sec. 16. 1. The board shall establish an advisory board to represent

6-13 patients, consisting of:

6-14 (a) Two members eligible for or receiving services under the program,

6-15 nominated by the director;

6-16 (b) One member nominated by the director of social services of Clark

6-17 County;

6-18 (c) One member nominated by the director of family and youth services

6-19 of Clark County;

6-20 (d) One member nominated by the legal aid society of Clark County;

6-21 and

6-22 (e) One member nominated by the Clark County chapter of the

6-23 American Association of Retired Persons.

6-24 2. The board may appoint additional members. If any of the

6-25 organizations named in subsection 1 ceases to exist, the board shall

6-26 designate a successor nominating organization. A nominated member must

6-27 be confirmed by a two-thirds vote of the board.

6-28 Sec. 17. 1. Each advisory board shall choose by lot at its first

6-29 meeting three members to serve for initial terms of 1 year. All other

6-30 members shall serve for terms of 2 years.

6-31 2. Each advisory board shall elect a chairman annually from among its

6-32 members.

6-33 3. Each advisory board shall hold at least six regular meetings each

6-34 year.

6-35 Sec. 18. Each member of an advisory board is entitled to receive from

6-36 the system $80 for each meeting of the advisory board that he attends, and

6-37 the board of directors may provide the same remuneration for attendance at

6-38 meetings of committees of the advisory board, but the total for all meetings

6-39 attended in a calendar month may not exceed $320. In addition, a member

6-40 is entitled to reimbursement for actual and necessary expenses for attending

6-41 meetings, at the rate payable to county officers and employees generally.

7-1 Sec. 19. A member of the board of directors or an advisory board shall

7-2 not participate in a decision concerning a proposed contract if he has a

7-3 conflict of interest. For the purposes of this section, a member does not

7-4 have a conflict of interest if:

7-5 1. He was nominated to represent the interests of a group of providers

7-6 of health care or services;

7-7 2. The contract authorizes him or other members of the group he

7-8 represents to provide services under the program of the system;

7-9 3. The terms of the contract are substantially similar to other contracts

7-10 with other members of the group he represents;

7-11 4. He does not influence or attempt to influence a fellow member of the

7-12 board or advisory board concerning the contract;

7-13 5. He discloses his interest in the contract to his fellow members and

7-14 abstains from voting; and

7-15 6. The board or advisory board notes the disclosure and decision in its

7-16 official records and enters into the contract in good faith by a sufficient

7-17 vote after reducing the number of votes required to take the action by the

7-18 number of members to whom this section specifically applies.

7-19 Sec. 20. 1. If the system obtains a certificate of authority to operate

7-20 as a health maintenance organization, it shall establish an automated

7-21 program for managing information, capable of timely producing detailed

7-22 and accurate information concerning the financial condition of the system

7-23 and other information generally required by the department in its contracts

7-24 with health maintenance organizations.

7-25 2. The department shall review the program and approve it if the

7-26 department determines that the program meets the requirements of

7-27 subsection 1. If the department approves the program, it may contract with

7-28 the system and make payments for the provision of services related to

7-29 health care. Such a contract need not comply with the requirements of

7-30 chapter 332 of NRS for competitive bidding.

7-31 Sec. 21. The department shall carry out capitated enrollment in

7-32 Medicaid pursuant to a contract with the system for the provision of

7-33 services related to health care to persons receiving medical assistance

7-34 pursuant to Medicaid in such a manner that appropriate levels of

7-35 administrative services will be provided to the providers of health care.

7-36 Such a contract must require the department to control the number of

7-37 persons receiving such services through the system to ensure that the

7-38 providers of services related to health care and the administrative structure

7-39 of the system are able to provide and support the provision of appropriate

7-40 and timely services.

8-1 Sec. 22. 1. In addition to any other information required to be

8-2 provided pursuant to Title 57 of NRS or a regulation adopted pursuant to

8-3 that Title, the system shall each month provide to the division of insurance,

8-4 the department and each member of the board a copy of:

8-5 (a) Detailed and accurate information concerning the financial condition

8-6 of the system as produced by the automated program established pursuant

8-7 to section 20 of this act;

8-8 (b) A projection of the assets and liabilities of the system, including

8-9 those incurred but not contained in the information provided pursuant to

8-10 paragraph (a); and

8-11 (c) An explanation of any material increase or decrease in current or

8-12 projected assets or liabilities.

8-13 2. Upon request, the system shall provide the information described in

8-14 paragraph (c) of subsection 1 to any hospital, group of physicians or clinic

8-15 that has contracted with the system to provide services related to health

8-16 care.

8-17 Sec. 23. In addition to any other information required to be provided

8-18 pursuant to Title 57 of NRS or a regulation adopted pursuant to that Title,

8-19 the system shall immediately notify the division of insurance, the

8-20 department and each member of the board in writing of any information or

8-21 situation that the director reasonably believes is likely to result in the

8-22 system’s becoming unable to satisfy its financial obligations. The notice

8-23 must describe the information or situation, the anticipated financial

8-24 consequences and the actions that the director or the system will take to

8-25 address those consequences.

8-26 Sec. 24. 1. The division of insurance shall not waive or change the

8-27 financial requirements of chapter 695C of NRS or of any regulation

8-28 adopted pursuant to that chapter as they apply to the system within 3 years

8-29 after the date the system begins to accept capitated payments.

8-30 2. If the system is not in compliance with the requirements described in

8-31 subsection 1, it shall develop, subject to the approval of the department and

8-32 the division of insurance, a program for stopping losses appropriate to the

8-33 risks incurred.

8-34 Sec. 25. If the department determines that the system may not be able

8-35 to meet its financial obligations to providers of health care who have

8-36 contracted with it for the provision of services involving the department,

8-37 the system shall submit its relevant financial records to the department. If

8-38 after reviewing those records the department determines that the system

8-39 will not be able to meet those obligations, the director of the department

8-40 shall immediately terminate all contracts between the system and the

8-41 department.

9-1 Sec. 26. 1. If the system ceases to function for the purposes for

9-2 which it was established and all of the obligations of the system have been

9-3 satisfied or the assets of the system have been exhausted, the board shall

9-4 dissolve the system.

9-5 2. The board shall, before it dissolves the system, notify the department

9-6 of its intent to do so. Within 30 days after receiving the notice, the

9-7 department shall conduct an audit of the records of the system to determine

9-8 its liabilities and assets and shall report the findings to the board within 10

9-9 days after it completes the audit.

9-10 3. The board shall prepare a plan to liquidate or otherwise dispose of

9-11 the assets and pay the liabilities of the system to the extent of the assets,

9-12 and present the plan to the department within 30 days after receiving the

9-13 results of the audit. The department shall approve or modify and approve

9-14 the plan within 30 days after receiving it. The board shall comply with the

9-15 plan as approved or modified.

9-16 4. If the system is dissolved, files for bankruptcy or ceases to function,

9-17 Clark County has the same priority as a provider of health care in the

9-18 disbursement of assets.