§ 131E-297. Hazardous financial condition. - North Carolina Statutes

§ 131E‑297. Hazardous financial condition.

(a)        Whenever the financial condition of any provider sponsoredorganization indicates a condition such that the continued operation of theprovider sponsored organization might be hazardous to its beneficiaries, creditors,or the general public, then the Division may order the provider sponsoredorganization to take any action that may be reasonably necessary to rectify theexisting condition, including one or more of the following steps:

(1)        To reduce the total amount of present and potentialliability for benefits by reinsurance;

(2)        To reduce the volume of new business being accepted;

(3)        To reduce the expenses by specified methods;

(4)        To suspend or limit the writing of new business for a periodof time;

(5)        To require an increase to the provider sponsoredorganization's net worth by contribution;

(6)        To add or delete sponsoring providers;

(7)        To increase the amount of payments from the PSO whichsponsoring providers agree to forego; or

(8)        To require additional guaranties from sponsoring providersor from parents of sponsoring providers.

(b)        If the Division determines that the standards in G.S. 131E‑286,131E‑288, and 131E‑289 do not provide sufficient early warning thatthe continued operation of any provider sponsored organization might behazardous to its beneficiaries, creditors, or the general public, the Divisionmay adopt rules to set uniform standards and criteria for such an early warningand to set standards for evaluating the financial condition of any providersponsored organization, which standards shall be consistent with the purposesexpressed in subsection (a) of this section. (1998‑227, s. 1.)