§ 27-4.7-5 - Regulatory action level event. - Rhode Island Statutes

SECTION 27-4.7-5

   § 27-4.7-5  Regulatory action level event.– (a) "Regulatory action level event" means, with respect to a healthorganization, any of the following events:

   (1) The filing of an RBC report by the health organizationthat indicates that the health organization's total adjusted capital is greaterthan or equal to its authorized control level RBC but less than its regulatoryaction level RBC;

   (2) Notification by the commissioner to a health organizationof an adjusted RBC report that indicates the event in subdivision (a)(1) ofthis section, provided the health organization does not challenge the adjustedRBC report under § 27-4.7-8;

   (3) If, pursuant to § 27-4.7-8, the health organizationchallenges an adjusted RBC report that indicates the event in subdivision(a)(1) of this section, the notification by the commissioner to the healthorganization that the commissioner has, after a hearing, rejected the healthorganization's challenge;

   (4) The failure of the health organization to file an RBCreport by the filing date, unless the health organization has provided anexplanation for the failure that is satisfactory to the commissioner and hascured the failure within ten (10) days after the filing date;

   (5) The failure of the health organization to submit an RBCplan to the commissioner within the time period set forth in § 27-4.7-4(c);

   (6) Notification by the commissioner to the healthorganization that:

   (i) The RBC plan or revised RBC plan submitted by the healthorganization is, in the judgment of the commissioner, unsatisfactory; and

   (ii) Notification constitutes a regulatory action level eventwith respect to the health organization, provided the health organization hasnot challenged the determination under § 27-4.7-8.

   (7) If, pursuant to § 27-4.7-8, the health organizationchallenges a determination by the commissioner under subdivision (6) of thissubsection, the notification by the commissioner to the health organizationthat the commissioner has, after a hearing, rejected the challenge;

   (8) Notification by the commissioner to the healthorganization that the health organization has failed to adhere to its RBC planor revised RBC plan, but only if the failure has a substantial adverse effecton the ability of the health organization to eliminate the company action levelevent in accordance with its RBC plan or revised RBC plan and the commissionerhas stated this in the notification, provided the health organization has notchallenged the determination under § 27-4.7-8; or

   (9) If, pursuant to § 27-4.7-8, the health organizationchallenges a determination by the commissioner under subdivision (8) of thissubsection, the notification by the commissioner to the health organizationthat the commissioner has, after a hearing, rejected the challenge.

   (b) In the event of a regulatory action level event thecommissioner shall:

   (1) Require the health organization to prepare and submit anRBC plan or, if applicable, a revised RBC plan;

   (2) Perform any examination or analysis that the commissionerdeems necessary of the assets, liabilities and operations of the healthorganization including a review of its RBC plan or revised RBC plan; and

   (3) Subsequent to the examination or analysis, issue an orderspecifying any corrective actions that the commissioner determines are required(a "corrective order").

   (c) In determining corrective actions, the commissioner maytake into account factors the commissioner deems relevant with respect to thehealth organization based upon the commissioner's examination or analysis ofthe assets, liabilities, and operations of the health organization, including,but not limited to, the results of any sensitivity tests undertaken pursuant tothe RBC instructions. The RBC plan or revised RBC plan shall be submitted:

   (1) Within forty-five (45) days after the occurrence of theregulatory action level event;

   (2) If the health organization challenges an adjusted RBCreport pursuant to § 27-4.7-8 and the challenge is not frivolous in thejudgment of the commissioner, within forty-five (45) days after thenotification to the health organization that the commissioner has, after ahearing, rejected the health organization's challenge; or

   (3) If the health organization challenges a revised RBC planpursuant to § 27-4.7-8 and the challenge is not frivolous in the judgmentof the commissioner, within forty-five (45) days after the notification to thehealth organization that the commissioner has, after a hearing, rejected thehealth organization's challenge.

   (d) The commissioner may retain actuaries and investmentexperts and other consultants that may be necessary in the judgment of thecommissioner to review the health organization's RBC plan or revised RBC plan,examine or analyze the assets, liabilities, and operations (includingcontractual relationships) of the health organization and formulate thecorrective order with respect to the health organization. The fees, costs, andexpenses relating to consultants shall be borne by the affected healthorganization or any other party as directed by the commissioner.