 |
 |
to fill out a simple form to connect to Employee Leasing Services in your area.
|
|
|
|
|
Lupton v. Blue Cross8/1/2000
Appeal by plaintiffs from order entered 14 June 1999 by Judge Ben F. Tennille in Durham County Superior Court. Heard in the Court of Appeals 8 June 2000.
On 30 June 1997, plaintiff Roland Giduz filed a class action against defendant Blue Cross and Blue Shield of North Carolina (Blue Cross) alleging, inter alia, violations of N.C. Gen. Stat. § 58-65-95. On 8 May 1998, plaintiff Bradshaw B. Lupton filed a class action against Blue Cross and filed an amended complaint on 28 October 1998, making allegations identical to those of Giduz. Pursuant to Rule 2.1 of the General Rules of Practice for the Superior and District Courts, the Chief Justice of our Supreme Court designated both actions as exceptional and assigned them to the Special Superior Court for Complex Business Cases. The trial court consolidated the two actions and substituted Lupton as the named plaintiff.
Blue Cross is a non-profit medical service corporation governed by Articles 65 and 66 of Chapter 58 of the North Carolina General Statutes. Chapter 58 requires that health insurers and medical service corporations maintain monetary "reserves" such that the solvency of the insurer will not likely be threatened if claims or other expenses are higher than forecast in any given year. Under N.C. Gen. Stat. § 58-65-95, Blue Cross is required to maintain a minimum monetary "reserve" to provide for contingent expenditures. Specifically:
Every such corporation [subject to this Article]
shall accumulate and maintain, ..., a special
contingent surplus or reserve at the following rates
annually of its gross annual collections from
membership dues, exclusive of receipts from cost
plus plans, until the reserve equals an amount that
is three times its average monthly expenditures for
claims and administrative and selling expenses:
(1) First $200,000...............4%
(2) Next $200,000.................2%
(3) All above $400,000...........1% N.C. Gen. Stat. § 58-65-95(b)(1999).
Additionally, the reserve may not "exceed an amount equal to six times the average monthly expenditures for claims and administrative and selling expenses." N.C. Gen. Stat. § 58-65-95(c)(1999).
Under our State's statutory rate making scheme, the Commissioner of Insurance (Commissioner) determines whether the rates filed by an insurer are reasonable. N.C. Gen. Stat. § 58-65-40 provides in part:
No corporation subject to the provisions of this Article and Article 66 of this Chapter shall enter into any contract with a subscriber after the enactment hereof unless and until it shall have filed with the Commissioner of Insurance a full schedule of rates to be paid by the subscribers to such contracts and shall have obtained the Commissioner's approval thereof. The Commissioner may refuse approval if he finds that such rates are excessive, inadequate or unfairly discriminatory; or do not exhibit a reasonable relationship to the benefits provided by such contracts. At all times such rates and form of subscribers' contracts shall be subject to modification and approval of the Commissioner of Insurance under rules and regulations adopted by the Commissioner, in conformity to this Article and Article 66 of this Chapter. N.C. Gen. Stat. § 58-65-40 (1999).
Under N.C. Gen. Stat. § 58-2-75(a)(1999), judicial review of the Commissioner's rate determination may be obtained by petition within 30 days of the Commissioner's decision. If no petition is filed, "the parties aggrieved shall be deemed to have waived the right to have the merits of the order or decision reviewed and ther
Page 1 2 3 North Carolina Employee Leasing Services
Employee Leasing Services
|
| |
to fill out a simple form to connect to Employee Leasing Services in your area.
|
|