---
kind: "section"
citation: "42 U.S.C. § 300e–17"
title: "42"
title_heading: "The Public Health and Welfare"
number: "300e–17"
heading: "Financial disclosure"
release: "119-102"
date: "2026-07-12"
url: "https://uscodex.org/usc/42/300e-17"
units:
  - "Chapter 6A — Public Health Service"
  - "Subchapter XI — Health Maintenance Organizations"
---

# §300e–17. Financial disclosure

- (a) **Financial information reported to Secretary—** Each [health maintenance organization](/usc/42/300gg–91.md?p=b-3) shall, in accordance with [regulations](/usc/42/201.md?p=d) of the [Secretary](/usc/42/201.md?p=c), report to the [Secretary](/usc/42/201.md?p=c) financial information which shall include the following:
  - (1) Such information as the [Secretary](/usc/42/201.md?p=c) may require demonstrating that the [health maintenance organization](/usc/42/300gg–91.md?p=b-3) has a fiscally sound operation.
  - (2) A copy of the report, if any, filed with the Centers for Medicare & Medicaid [Services](/usc/42/201.md?p=a) containing the information required to be reported under [section 1320a–3 of this title](/usc/42/1320a–3.md) by disclosing entities and the information required to be supplied under [section 1396a(a)(38) of this title](/usc/42/1396a.md?p=a-38).
  - (3) A description of transactions, as specified by the [Secretary](/usc/42/201.md?p=c), between the [health maintenance organization](/usc/42/300gg–91.md?p=b-3) and a party in interest. Such transactions shall include—
    - (A) any sale or [exchange](/usc/42/300gg–91.md?p=d-21), or leasing of any property between the [health maintenance organization](/usc/42/300gg–91.md?p=b-3) and a party in interest;
    - (B) any furnishing for consideration of goods, [services](/usc/42/201.md?p=a) (including management [services](/usc/42/201.md?p=a)), or facilities between the [health maintenance organization](/usc/42/300gg–91.md?p=b-3) and a party in interest, but not including salaries paid to [employees](/usc/42/300gg–91.md?p=d-5) for [services](/usc/42/201.md?p=a) provided in the normal course of their employment and health [services](/usc/42/201.md?p=a) provided to [members](/usc/42/300e–1.md?p=3) by [hospitals](/usc/42/300s–3.md?p=1) and other [providers](/usc/42/299b–21.md?p=8) and by staff, [medical group](/usc/42/300e–1.md?p=4) (or groups), [individual practice association](/usc/42/300e–1.md?p=5) (or associations), or any combination thereof; and
    - (C) any lending of money or other extension of credit between a [health maintenance organization](/usc/42/300gg–91.md?p=b-3) and a party in interest.

  The [Secretary](/usc/42/201.md?p=c) may require that information reported respecting a [health maintenance organization](/usc/42/300gg–91.md?p=b-3) which controls, is controlled by, or is under common control with, another entity be in the form of a consolidated financial statement for the organization and such entity.

- (b) **“Party in interest” defined—** For the purposes of this section the term “party in interest” means:
  - (1) any [director](/usc/42/11851.md?p=5), officer, partner, or [employee](/usc/42/300gg–91.md?p=d-5) responsible for management or administration of a [health maintenance organization](/usc/42/300gg–91.md?p=b-3), any person who is directly or indirectly the beneficial [owner](/usc/42/13641.md?p=4) of more than 5 per centum of the equity of the organization, any person who is the beneficial [owner](/usc/42/13641.md?p=4) of a mortgage, deed of trust, note, or other interest secured by, and valuing more than 5 per centum of the [health maintenance organization](/usc/42/300gg–91.md?p=b-3), and, in the case of a [health maintenance organization](/usc/42/300gg–91.md?p=b-3) organized as a [nonprofit](/usc/42/300s–3.md?p=3) [corporation](/usc/42/2297h.md?p=2), an incorporator or [member](/usc/42/300e–1.md?p=3) of such [corporation](/usc/42/2297h.md?p=2) under applicable [State](/usc/42/201.md?p=f) [corporation](/usc/42/2297h.md?p=2) law;
  - (2) any entity in which a person described in [paragraph (1)](#b-1)—
    - (A) is an officer or [director](/usc/42/11851.md?p=5);
    - (B) is a partner (if such entity is organized as a partnership);
    - (C) has directly or indirectly a beneficial interest of more than 5 per centum of the equity; or
    - (D) has a mortgage, deed of trust, note, on other interest valuing more than 5 per centum of the assets of such entity;
  - (3) any person directly or indirectly controlling, controlled by, or under common control with a [health maintenance organization](/usc/42/300gg–91.md?p=b-3); and
  - (4) any spouse, child, or parent of an individual described in [paragraph (1)](#b-1).
- (c) **Information availability—** Each [health maintenance organization](/usc/42/300gg–91.md?p=b-3) shall make the information reported pursuant to [subsection (a)](#a) available to its enrollees upon reasonable request.
- (d) **Evaluation of transactions—** The [Secretary](/usc/42/201.md?p=c) shall, as he deems necessary, conduct an evaluation of transactions reported to the [Secretary](/usc/42/201.md?p=c) under [subsection (a)(3)](#a-3) for the purpose of determining their adverse impact, if any, on the fiscal soundness and reasonableness of charges to the [health maintenance organization](/usc/42/300gg–91.md?p=b-3) with respect to which they transpired. The [Secretary](/usc/42/201.md?p=c) shall evaluate the reported transactions of not less than five, or if there are more than twenty [health maintenance organizations](/usc/42/300gg–91.md?p=b-3) reporting such transactions, not less than one-fourth of the [health maintenance organizations](/usc/42/300gg–91.md?p=b-3) reporting any such transactions under [subsection (a)(3)](#a-3).
- (e) **Repealed. Pub. L. 99–660, title VIII, § 810, Nov. 14, 1986, 100 Stat. 3801—**
- (f) **Rates—** Nothing in this section shall be construed to confer upon the [Secretary](/usc/42/201.md?p=c) any authority to approve or disapprove the rates charged by any [health maintenance organization](/usc/42/300gg–91.md?p=b-3).
- (g) **Annual financial statement—** Any [health maintenance organization](/usc/42/300gg–91.md?p=b-3) failing to file with the [Secretary](/usc/42/201.md?p=c) the annual financial statement required in [subsection (a)](#a) shall be ineligible for any Federal assistance under this subchapter until such time as such statement is received by the [Secretary](/usc/42/201.md?p=c) and shall not be a qualified [health maintenance organization](/usc/42/300gg–91.md?p=b-3) for purposes of [section 300e–9 of this title](/usc/42/300e–9.md).
- (h) **Penalties—** Whoever knowingly and willfully makes or causes to be made any false statement or representation of a material fact in any statement filed pursuant to this section shall be guilty of a felony and upon conviction thereof shall be fined not more than $25,000 or imprisoned for not more than five years, or both.

## Source credit

(July 1, 1944, ch. 373, title XIII, § 1318, as added Pub. L. 95–559, § 9(a), Nov. 1, 1978, 92 Stat. 2135; amended Pub. L. 97–35, title IX, § 948, Aug. 13, 1981, 95 Stat. 577; Pub. L. 99–660, title VIII, § 810, Nov. 14, 1986, 100 Stat. 3801; Pub. L. 108–173, title IX, § 900(e)(2)(E), Dec. 8, 2003, 117 Stat. 2372.)

## Notes

### Editorial Notes

### Amendments

2003—Subsec. (a)(2). Pub. L. 108–173 substituted “Centers for Medicare & Medicaid Services” for “Health Care Financing Administration”.

1986—Subsec. (e). Pub. L. 99–660 struck out subsec. (e) which read as follows: “The Secretary shall file an annual report with the Congress on the operation of this section. Such report shall include—

“(1) an enumeration of standards and norms utilized to make the evaluations required under subsection (d) of this section;

“(2) an assessment of the degree of conformity or nonconformity of each health maintenance organization evaluated by the Secretary under subsection (d) of this section with such standards and norms;

“(3) what action, if any, the Secretary considers necessary under section 300e–11 of this title with respect to health maintenance organizations evaluated under subsection (d) of this section.”

1981—Subsec. (a). Pub. L. 97–35, § 948(a), (b), in par. (2) inserted reference to copy of the report, if any, filed with the Health Care Financing Administration, and in par. (3)(B) reorganized excluding provisions and, among revisions, inserted salaries paid to employees for services.

Subsec. (b)(1). Pub. L. 97–35, § 948(c), inserted “responsible for management or administration” after “employee”.

Subsec. (b)(4). Pub. L. 97–35, § 948(d), substituted “spouse, child, or parent” for “member of the immediate family”.

### Statutory Notes and Related Subsidiaries

### Effective Date of 1986 Amendment

Amendment by Pub. L. 99–660 effective Oct. 1, 1985, see section 815(a) of Pub. L. 99–660, set out as an Effective and Termination Dates of 1986 Amendment note under section 300e–1 of this title.