Section 2699.6173 - Disqualification of Member Employers(a) A member employer shall be disqualified from participation in the program if any of the following occur: (1) Their guaranteed association is disqualified and the member employer does not change its status to sole employer pursuant to 2699.6171.(2) It is found by the program pursuant to Section 2699.6119(b) to no longer be a qualified member employer.(3) It is found by the program to no longer be in compliance with the participation requirements as set forth in Section 2699.6111.(4) It fails to pay the monthly employer premium for the enrolled member employees and enrolled dependents as set forth in Sections 2699.6311 and 2699.6315 of this part.(5) It so requests in writing. Such requests shall be provided to the program at least thirty (30) calendar days prior to the effective date of the requested disqualification.(6) It has committed an act of fraud or misrepresentation to circumvent the statutes or regulations of the program.(b) When a participating member employer is disqualified pursuant to (a)(1), (a)(2), (a)(3), or (a)(4) above, the program shall notify the employer, each enrolled member employee and the qualified guaranteed association of the disqualification and the fact that all member employees and dependents will be disenrolled. Notices sent to enrolled member employees shall be sent to their addresses of record. (1) The notice shall be in writing and include the following information: (A) The reason for the disqualification,(B) The effective date of disqualification, and(C) The final day of coverage provided through the program.(2) When an employer is disqualified pursuant to (a)(4), the notice shall be sent after thirty-one (31) calendar days following the premium due date and also include a statement that the employer may again be qualified if the employer meets the requirements of Section 2699.6323 and a statement of the requirements of Section 2699.6323.(c) An employer which is disqualified pursuant to (a)(1), (a)(2) or, (a)(3) above may reapply to the program whenever it again meets the requirements to be a qualified sole employer or it again meets the requirements to be a qualified member employer.(d) An employer which is disqualified pursuant to (a)(5) or (a)(6) above, or an employer disqualified pursuant to (a)(4) above which does not reinstate pursuant to Section 2699.6319, cannot participate in the program for one (1) year from the date of disqualification.(e) Member employees of member employers which are disqualified may apply to be individual members sponsored by a qualified guaranteed association if the individuals have not committed fraud or violated the program's rules to the detriment of the program.Cal. Code Regs. Tit. 10, § 2699.6173
1. Renumbering and amendment of former section 2699.626.2 to section 2699.6173 filed 5-27-94; operative 5-27-94 (Register 94, No. 21).
2. Amendment of subsection (a)(2), new subsection (a)(3) and subsection renumbering, and amendment of subsections (b), (b)(2), (c) and (d) filed 5-5-97; operative 7-1-97 (Register 97, No. 19). Note: Authority cited: Section 10731, Insurance Code. Reference: Section 10731, Insurance Code.
1. Renumbering and amendment of former section 2699.626.2 to section 2699.6173 filed 5-27-94; operative 5-27-94 (Register 94, No. 21).
2. Amendment of subsection (a)(2), new subsection (a)(3) and subsection renumbering, and amendment of subsections (b), (b)(2), (c) and (d) filed 5-5-97; operative 7-1-97 (Register 97, No. 19).