The Legislature of Alabama takes cognizance of the existence of many Alabama citizens who are unable to obtain adequate health care protection by reason of economic, physical or other related causes. It is the purpose of the Legislature to provide adequate health care protection through this plan to those persons not otherwise able to obtain such protection by insurance companies or voluntary association on a nonprofit basis.

Any insurer authorized and licensed to engage in the business of health insurance in this state may join with one or more other such insurers to offer to any resident of this state, who meets the qualifications established by the commissioner, insurance against major financial loss from accident or disease. Such insurance may be offered by such insurers in their own names or in the name of a voluntary unincorporated association or other organization formed by such insurers solely for the purpose of this plan. The forms of applications, certifications and policies of such insurance, the applicable premium rates, annual statement and all other information required by the department under Alabama law for organizations in the business of health insurance shall be filed with the commissioner for his approval. Any other information which the commissioner deems necessary for the efficient operation of the plan may also be required.

Each insurer or association electing to come under the provisions of this chapter shall charge the same premium for the same insurance coverage and be allowed the same percentage for expense of administration. Such premium rate and percentage for administration expense shall be determined and approved by the commissioner so as to maintain the nonprofit basis of the plan.

The premiums collected under the provisions of the health care plan are hereby exempt from the payment of premium tax under Chapter 4 of this title. Any losses suffered as a direct result of operation under the plan by those organizations electing to join and operate under the health care plan may be deducted from the premium tax submitted under the above-mentioned Chapter 4 which would normally be paid on individual accident and health insurance premiums collected, but total loss deduction shall not exceed 50 percent of such premium tax normally payable on premiums from individual accident and health insurance.

(a) The commissioner shall set up standards and promulgate regulations concerning the qualifications of those Alabama citizens entitled to utilize this plan, and no insurer or association operating under the plan shall allow anyone to be insured under the plan unless that person meets these qualifications. Any willful material misrepresentation by a person attempting to qualify under the plan shall be a misdemeanor and, upon conviction thereof, shall be punishable as prescribed in Section 13A-5-1.

(b) The commissioner may also make other necessary rules or regulations and may conduct any examination as to insurers at any reasonable time and may also, at his discretion, hold public hearings to determine qualifications of prospective insureds or rates and expenses of insurers in furtherance of this plan. The commissioner may also employ consultants, actuaries, attorneys or special investigators or examiners to assist him in the regulation of the plan and examination of the insurers, and the expense of these special assistants and consultants, along with any regular examination costs, will be borne by the concerned insurer.

This chapter shall be known as the Alabama Health Care Plan and may be referred to by that designation.