![]() |
Code of Federal Regulations (Last Updated: July 5, 2024) |
![]() |
Title 42 - Public Health |
![]() |
Chapter IV - Centers for Medicare & Medicaid Services, Department of Health and Human Services |
![]() |
SubChapter B - Medicare Program |
![]() |
Part 417 - Health Maintenance Organizations, Competitive Medical Plans, and Health Care Prepayment Plans |
![]() |
Subpart C - Qualified Health Maintenance Organizations: Organization and Operation |
§ 417.126 - Recordkeeping and reporting requirements.
-
§ 417.126 Recordkeeping and reporting requirements.
(a) General reporting and disclosure requirements. Each HMO must have an effective procedure to develop, compile, evaluate, and report to CMS, to its enrollees, and to the general public, at the times and in the manner that CMS requires, and while safeguarding the confidentiality of the doctor-patient relationship, statistics and other information with respect to the following:
(1) The cost of its operations.
(2) The patterns of utilization of its services.
(3) The availability, accessibility, and acceptability of its services.
(4) To the extent practical, developments in the health status of its enrollees.
(5) Information demonstrating that the HMO has a fiscally sound operation.
(6) Other matters that CMS may require.
(b) Significant business transactions. Each HMO must report to CMS annually, within 120 days of the end of its fiscal year (unless for good cause shown, CMS authorizes an extension of time), the following:
(1) A description of significant business transactions (as defined in paragraph (c) of this section) between the HMO and a party in interest.
(2) With respect to those transactions -
(i) A showing that the costs of the transactions listed in paragraph (c) of this section do not exceed the costs that would be incurred if these transactions were with someone who is not a party in interest; or
(ii) If they do exceed, a justification that the higher costs are consistent with prudent management and fiscal soundness requirements.
(3) A combined financial statement for the HMO and a party in interest if either of the following conditions is met:
(i) Thirty-five percent or more of the costs of operation of the HMO go to a party in interest.
(ii) Thirty-five percent or more of the revenue of a party in interest is from the HMO.
(c) “Significant business transaction” defined. As used in paragraph (b) of this section -
(1) Business transaction means any of the following kinds of transactions:
(i) Sale, exchange or lease of property.
(ii) Loan of money or extension of credit.
(iii) Goods, services, or facilities furnished for a monetary consideration, including management services, but not including -
(A) Salaries paid to employees for services performed in the normal course of their employment; or
(B) Health services furnished to the HMO's enrollees by hospitals and other providers, and by HMO staff, medical groups, or IPAs, or by any combination of those entities.
(2) Significant business transaction means any business transaction or series of transactions of the kind specified in paragraph (c)(1) of this section that, during any fiscal year of the HMO, have a total value that exceeds $25,000 or 5 percent of the HMO's total operating expenses, whichever is less.
(d) Requirements for combined financial statements.
(1) The combined financial statements required by paragraph (b)(3) of this section must display in separate columns the financial information for the HMO and each of these parties in interest.
(2) Inter-entity transactions must be eliminated in the consolidated column.
(3) These statements must have been examined by an independent auditor in accordance with generally accepted accounting principles, and must include appropriate opinions and notes.
(4) Upon written request from an HMO showing good cause, CMS may waive the requirement that its combined financial statement include the financial information required in this paragraph (d) with respect to a particular entity.
(e) Reporting and disclosure under ERISA.
(1) For any employees' health benefits plan that includes an HMO in its offerings, the HMO must furnish, upon request, the information the plan needs to fulfill its reporting and disclosure obligations (with respect to the particular HMO) under the Employee Retirement Income Security Act of 1974 (ERISA).
(i) The HMO must furnish the information to the employer or the employer's designee, or to the plan administrator, as the term “administrator” is defined in ERISA.
(ii) Loan of money or extension of credit.
(iii) Goods, services, or facilities furnished for a monetary consideration, including management services, but not including -
(A) Salaries paid to employees for services performed in the normal course of their employment; or
(B) Health services furnished to the HMO's enrollees by hospitals and other providers, and by HMO staff, medical groups, or IPAs, or by any combination of those entities.
(2) Significant business transaction means any business transaction or series of transactions of the kind specified in paragraph (c)(1) of this section that, during any fiscal year of the HMO, have a total value that exceeds $25,000 or 5 percent of the HMO's total operating expenses, whichever is less.
(d) Requirements for combined financial statements. (1) The combined financial statements required by paragraph (b)(3) of this section must display in separate columns the financial information for the HMO and each of these parties in interest.
(2) Inter-entity transactions must be eliminated in the consolidated column.
(3) These statements must have been examined by an independent auditor in accordance with generally accepted accounting principles, and must include appropriate opinions and notes.
(4) Upon written request from an HMO showing good cause, CMS may waive the requirement that its combined financial statement include the financial information required in this paragraph (d) with respect to a particular entity.
(e) Reporting and disclosure under ERISA.
(1) For any employees' health benefits plan that includes an HMO in its offerings, the HMO must furnish, upon request, the information the plan needs to fulfill its reporting and disclosure obligations (with respect to the particular HMO) under the Employee Retirement Income Security Act of 1974 (ERISA).
(2) The HMO must furnish the information to the employer or the employer's designee, or to the plan administrator, as the term “administrator” is defined in ERISA.