PRINTER'S NO. 654
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
640
Session of
2019
INTRODUCED BY DeLUCA, CALTAGIRONE, MURT AND HILL-EVANS,
MARCH 1, 2019
REFERRED TO COMMITTEE ON HEALTH, MARCH 1, 2019
AN ACT
Amending Titles 10 (Charities), 15 (Corporations and
Unincorporated Associations) and 40 (Insurance) of the
Pennsylvania Consolidated Statutes, in boards of directors,
providing for scope of chapter, for definitions and for
prohibition; in officers, directors and members, further
providing for compensation of directors; in hospital plan
corporations, further providing for definitions and providing
for prohibition; and, in professional health services plan
corporations, further providing for definitions and for board
of directors.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Title 10 of the Pennsylvania Consolidated
Statutes is amended by adding parts to read:
PART I
PRELIMINARY PROVISIONS
(Reserved)
PART II
NONPROFIT ORGANIZATIONS
Chapter
21. Preliminary Provisions (Reserved)
23. Boards of Directors
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CHAPTER 21
PRELIMINARY PROVISIONS
(Reserved)
CHAPTER 23
BOARDS OF DIRECTORS
Sec.
2301. Scope of chapter.
2302. Definitions.
2303. Prohibition.
§ 2301. Scope of chapter.
This chapter relates to boards of directors of nonprofit
organizations.
§ 2302. Definitions.
The following words and phrases when used in this chapter
shall have the meanings given to them in this section unless the
context clearly indicates otherwise:
"Board of directors." The group of persons vested with the
management of the business and affairs of a nonprofit
organization irrespective of the name by which the group is
designated. The term does not include another body.
"Director." A person designated, elected or appointed, by
that or any other name or title, to act as a director, and his
successors. The term does not include a member of another body.
"Nonprofit organization." An entity listed under section
501(c)(3) of the Internal Revenue Code of 1986 (Public Law 99-
514, 26 U.S.C. § 501(c)(3)).
§ 2303. Prohibition.
A director may not receive compensation for services as a
director of a nonprofit organization.
Section 2. Section 5730 of Title 15 is amended to read:
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§ 5730. Compensation of directors.
[Except as otherwise restricted in the bylaws, the board of
directors of a nonprofit corporation shall have the authority to
fix the compensation of directors for their services as
directors, and a director may be a salaried officer of the
corporation.] A director may not receive compensation for
services as a director.
Section 3. Section 6101 introductory paragraph of Title 40
is amended and the section is amended by adding definitions to
read:
§ 6101. Definitions.
The following words and phrases when used in this chapter
shall have[, unless the context clearly indicates otherwise,]
the meanings given to them in this section unless the context
clearly indicates otherwise:
"Compensation." Anything given or received as an equivalent
for services. The term does not include reimbursement for costs
and expenses reasonably incurred by the independent officer,
director or trustee in the course and support of services.
* * *
"Independent officer, director or trustee." An officer,
director or trustee of a hospital plan corporation who is not
serving as an employee, or the equivalent of an employee, of the
hospital plan corporation.
* * *
Section 4. Title 40 is amended by adding a section to read:
§ 6128. Prohibition.
A hospital plan corporation may not provide compensation to
an independent officer, director or trustee for services as an
independent officer, director or trustee.
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Section 5. Section 6302(a) introductory paragraph of Title
40 is amended and the subsection is amended by adding a
definition to read:
§ 6302. Definitions.
(a) General rule.--The following words and phrases when used
in this chapter shall have[, unless the context clearly
indicates otherwise,] the meanings given to them in this section
unless the context clearly indicates otherwise:
* * *
"Compensation." Anything given or received as an equivalent
for services. The term does not include reimbursement for costs
and expenses reasonably incurred by the independent officer,
director or trustee in the course and support of services.
* * *
Section 6. Section 6328(b) of Title 40 is amended by adding
a paragraph to read:
§ 6328. Board of directors.
* * *
(b) General medical service corporation.--
* * *
(7) A general medical service corporation may not
provide compensation to a director for services as a
director.
Section 7. This act shall take effect in 60 days.
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