31A-8-209 - Minimum capital or minimum permanent surplus. - Utah Statutes

31A-8-209. Minimum capital or minimum permanent surplus.
(1) (a) A health maintenance organization being organized or operating under this chaptershall have and maintain a minimum capital or minimum permanent surplus of $100,000.
(b) Each health maintenance organization authorized to do business in this state shall haveand maintain qualified assets as defined in Subsection 31A-17-201(2) in an amount not less thanthe total of:
(i) the health maintenance organization's liabilities;
(ii) the health maintenance organization's minimum capital or minimum permanentsurplus required by Subsection (1)(a); and
(iii) the greater of:
(A) the company action level RBC as defined in Subsection 31A-17-601(8)(b); or
(B) $1,300,000.
(2) (a) The minimum required capital or minimum permanent surplus for a limited healthplan may not:
(i) be less than $10,000; or
(ii) exceed $100,000.
(b) The initial minimum required capital or minimum permanent surplus for a limitedhealth plan required by Subsection (2)(a) shall be set by the commissioner, after:
(i) a hearing; and
(ii) consideration of:
(A) the services to be provided by the limited health plan;
(B) the size and geographical distribution of the population the limited health plananticipates serving;
(C) the nature of the limited health plan's arrangements with providers; and
(D) the arrangements, agreements, and relationships of the limited health plan in place orreasonably anticipated with respect to:
(I) insolvency insurance;
(II) reinsurance;
(III) lenders subordinating to the interests of enrollees and trade creditors;
(IV) personal and corporate financial guarantees;
(V) provider withholds and assessments;
(VI) surety bonds;
(VII) hold harmless agreements in provider contracts; and
(VIII) other arrangements, agreements, and relationships impacting the security ofenrollees.
(c) Upon a material change in the scope or nature of a limited health plan's operations, thecommissioner may, after a hearing, alter the limited health plan's minimum required capital orminimum permanent surplus.
(3) The commissioner may allow the minimum capital or permanent surplus account ofan organization to be designated by some other name.
(4) A pattern of persistent deviation from the accounting and investment standards underthis section may be grounds for the commissioner to find that the one or more persons withauthority to make the organization's accounting or investment decisions are incompetent forpurposes of Subsection 31A-5-410(3).

Amended by Chapter 308, 2002 General Session