Mich. Comp. Laws » Michigan Compiled Laws / Chapter 550 / Act 350 of 1980
Michigan Compiled Laws

Mich. Comp. Laws § 550.1201 (2026)

Health care corporation; incorporation; number of persons; payment of cash or other material benefit to subscriber; applicable laws; charitable and benevolent institution; exemption from taxation; certificate of authority; health care benefits and certificates.

✓ current as of July 2026
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THE NONPROFIT HEALTH CARE CORPORATION REFORM ACT


Act 350 of 1980


550.1201 Health care corporation; incorporation; number of persons; payment of cash or other material benefit to subscriber; applicable laws; charitable and benevolent institution; exemption from taxation; certificate of authority; health care benefits and certificates.

Sec. 201.

    (1) A health care corporation shall not be incorporated in this state except under this act.

    (2) Not less than 7 persons, all of whom shall be residents of this state, may form a health care corporation under this act for the purpose of providing 1 or more health care benefits at the expense of the corporation to persons or groups of persons who become subscribers to the plan, under certificates which will entitle each subscriber to certain health care services by providers with which the corporation has contracted for that purpose.

    (3) A certificate shall not provide for the payment of cash or any other material benefit to a subscriber or the estate of a subscriber on account of death, illness, or injury except where payment is made to a subscriber for health care services by a provider who has not entered into a participating contract with the corporation or to reimburse a subscriber who has made, or is obligated to make, payment directly to a provider.

    (4) A health care corporation shall not be subject to the laws of this state with respect to insurance corporations, except as provided in this act. A health care corporation shall not be subject to the laws of this state with respect to corporations generally.

    (5) A health care corporation subject to this act is declared to be a charitable and benevolent institution, and its funds and property shall be exempt from taxation by this state or any political subdivision of this state.

    (6) A person shall not act as a health care corporation or issue a certificate except as authorized by and pursuant to a certificate of authority granted to the person by the commissioner pursuant to this act.

    (7) A health care corporation shall provide only the kinds of health care benefits and certificates authorized by this act. A health care corporation shall not make or issue a certificate relative to health care benefits except as approved or otherwise authorized under this act.

History: 1980, Act 350, Eff. Apr. 3, 1981

PopularName Notes:

Blue Cross-Blue Shield

PopularName Notes:

Act 350
Notes of Decisions
Cited in 3 cases, 1997–1997 · leading case: Blue Cross & Blue Shield v. Eaton Rapids Cmty. Hosp., 561 N.W.2d 488 (Mich. Ct. App. 1997).
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Blue Cross & Blue Shield v. Eaton Rapids Cmty. Hosp., 561 N.W.2d 488 (Mich. Ct. App. 1997). · cites it 2× “Bcbsm points out that § 201(5) of the nhccra, MCL 550.1201(5); MSA 24.660(201)(5), exempts bcbsm’s funds and property from “taxation” by the state and its political subdivisions, and suggests that “taxation” includes taxation of any kind, including taxation of costs under MCR 2.”
Sluiter v. Blue Cross & Blue Shield of Michigan, 979 F. Supp. 1131 (E.D. Mich. 1997). · cites it 2× “Blue Cross also *1137 argues that they are not an insurance company because the Michigan Legislature does not regulate them in such a way.”
Foster v. Blue Cross & Blue Shield of Michigan, 969 F. Supp. 1020 (E.D. Mich. 1997). · cites it 2× “Mich.Comp.Laws Ann. §§ 550.1201 to 550.1313.”
Mich. Comp. Laws § 550.1201(5): 1 case
Blue Cross & Blue Shield v. Eaton Rapids Cmty. Hosp., 561 N.W.2d 488 (Mich. Ct. App. 1997). “Bcbsm points out that § 201(5) of the nhccra, MCL 550.1201(5); MSA 24.660(201)(5), exempts bcbsm’s funds and property from “taxation” by the state and its political subdivisions, and suggests that “taxation” includes taxation of any kind, including taxation of costs under MCR 2.”
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