Rhode Island General Laws 27-41-13.3. Waiver, surplus notes, and risk-based capital requirements
(a) The director may waive any of the net worth or total adjusted capital requirements, or both, as set forth in § 27-41-13.1 or § 27-41-13.2, whenever satisfied that the health maintenance organization has sufficient net worth or total adjusted capital, or both, and an adequate history of generating net income to ensure its financial viability for the next year, or its performance and obligations are guaranteed by an organization with sufficient net worth and an adequate history of generating net income, or the assets of the health maintenance organization or its contracts with insurers, hospital or medical service corporations, governments, or other organizations are sufficient to reasonably assure the performance of its obligations; provided, however, that in no event shall the net worth requirement be less than two million five hundred thousand dollars ($2,500,000).
Terms Used In Rhode Island General Laws 27-41-13.3
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Director: means the director of the department of business regulation or his or her duly appointed agents. See Rhode Island General Laws 27-41-2
- Health maintenance organization: means a single public or private organization that:
(i) Provides or makes available to enrolled participants healthcare services, including at least the following basic healthcare services: usual physician services, hospitalization, laboratory, x-ray, emergency, and preventive services, and out-of-area coverage, and the services of licensed midwives;
(ii) Is compensated, except for copayments, for the provision of the basic healthcare services listed in subsection (20)(i) of this section to enrolled participants on a predetermined periodic rate basis;
(iii)(A) Provides physicians' services primarily:
(I) Directly through physicians who are either employees or partners of the organization; or
(II) Through arrangements with individual physicians or one or more groups of physicians organized on a group practice or individual practice basis;
(B) "Health maintenance organization" does not include prepaid plans offered by entities regulated under chapter 1, 2, 19, or 20 of this title that do not meet the criteria above and do not purport to be health maintenance organizations; and
(iv) Provides the services of licensed midwives primarily:
(A) Directly through licensed midwives who are either employees or partners of the organization; or
(B) Through arrangements with individual licensed midwives or one or more groups of licensed midwives organized on a group practice or individual practice basis. See Rhode Island General Laws 27-41-2
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Total adjusted capital: means the sum of:
(i) A health maintenance organization's statutory capital and surplus (i. See Rhode Island General Laws 27-41-2
(b) Surplus notes.
(1) In determining net worth, no debt is considered fully subordinated unless the subordination clause is in a form acceptable to the director. Any interest obligation relating to the repayment of any subordinated debt must be similarly subordinated.
(2) The interest expenses relating to the repayment of any fully subordinated debt are considered covered expenses.
(3) Any debt incurred by a note meeting the requirements of this section, and otherwise acceptable to the director, is not considered a liability and is recorded as equity.
(c) In addition to the net worth and capital requirements of § 27-41-13.1 through § 27-41-13.3, all requirements of chapter 4.7 of this title shall apply to health maintenance organizations.
History of Section.
P.L. 2005, ch. 176, § 2.