As Reported by the Senate Insurance, Commerce 2
and Labor Committee 2
123rd General Assembly 5
Regular Session Am. H. B. No. 714 6
1999-2000 7
REPRESENTATIVES EVANS-NETZLEY-GOODMAN-BRITTON-JONES- 9
SMITH-BENDER-SCHURING-JOLIVETTE-WILLAMOWSKI-CLANCY- 10
GARDNER-HOLLISTER-WINKLER-TIBERI-BUCHY-O'BRIEN-SALERNO- 12
SENATOR HOTTINGER
_________________________________________________________________ 14
A B I L L
To amend section 1753.01 and to enact sections 16
1753.31 to 1753.43 of the Revised Code to apply, 17
with modifications, the National Association of 18
Insurance Commissioners' Risk-Based Capital for
Insurers Model Act to health insuring 19
corporations.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO: 21
Section 1. That section 1753.01 be amended and sections 23
1753.31, 1753.32, 1753.33, 1753.34, 1753.35, 1753.36, 1753.37, 24
1753.38, 1753.39, 1753.40, 1753.41, 1753.42, and 1753.43 of the 25
Revised Code be enacted to read as follows: 26
Sec. 1753.01. As used in this chapter: 35
(A) "Economic profiling" means a health insuring 37
corporation's use of economic performance data and economic 38
information in determining whether to contract with a provider 39
for the provision of covered health care services to enrollees as 41
a participating provider.
(B) "Basic health care services," "enrollee," "health care 43
facility," "health care services," "health insuring corporation," 44
"medical record," "PERSON," "PRIMARY CARE PROVIDER," "provider," 46
and "SUBSCRIBER," AND "supplemental health care services" have 48
the same meanings as in section 1751.01 of the Revised Code. 50
2
Sec. 1753.31. AS USED IN SECTIONS 1753.31 TO 1753.43 OF 52
THE REVISED CODE: 54
(A) "ADJUSTED RBC REPORT" MEANS AN RBC REPORT THAT HAS 57
BEEN ADJUSTED BY THE SUPERINTENDENT OF INSURANCE IN ACCORDANCE 58
WITH DIVISION (C) OF SECTION 1753.32 OF THE REVISED CODE. 59
(B) "AUTHORIZED CONTROL LEVEL RBC" MEANS THE NUMBER 61
DETERMINED UNDER THE RISK-BASED CAPITAL FORMULA IN ACCORDANCE 63
WITH THE RBC INSTRUCTIONS. 64
(C) "COMPANY ACTION LEVEL RBC" MEANS THE PRODUCT OF 2.0 66
AND A HEALTH INSURING CORPORATION'S AUTHORIZED CONTROL LEVEL RBC. 67
(D) "CORRECTIVE ORDER" MEANS AN ORDER ISSUED BY THE 69
SUPERINTENDENT OF INSURANCE SPECIFYING CORRECTIVE ACTIONS THAT 70
THE SUPERINTENDENT DETERMINES ARE REQUIRED. 71
(E) "DOMESTIC HEALTH INSURING CORPORATION" MEANS A HEALTH 73
INSURING CORPORATION DOMICILED IN THIS STATE. 74
(F) "FOREIGN HEALTH INSURING CORPORATION" MEANS A HEALTH 76
INSURING CORPORATION HOLDING A CERTIFICATE OF AUTHORITY UNDER 77
CHAPTER 1751. OF THE REVISED CODE THAT IS DOMICILED OUTSIDE OF 78
THIS STATE.
(G) "MANDATORY CONTROL LEVEL RBC" MEANS THE PRODUCT OF .70 80
AND A HEALTH INSURING CORPORATION'S AUTHORIZED CONTROL LEVEL RBC. 81
(H) "NAIC" MEANS THE NATIONAL ASSOCIATION OF INSURANCE 83
COMMISSIONERS. 84
(I) "NET WORTH" MEANS STATUTORY CAPITAL AND SURPLUS. 86
(J) "RBC" MEANS RISK-BASED CAPITAL. 88
(K) "RBC INSTRUCTIONS" MEANS THE RBC REPORT, INCLUDING 91
RISK-BASED CAPITAL INSTRUCTIONS, AS ADOPTED BY THE NAIC AND AS 92
AMENDED BY THE NAIC FROM TIME TO TIME IN ACCORDANCE WITH THE 93
PROCEDURES ADOPTED BY THE NAIC. "RBC INSTRUCTIONS" ALSO INCLUDES 94
ANY MODIFICATIONS ADOPTED BY THE SUPERINTENDENT OF INSURANCE, AS 95
THE SUPERINTENDENT CONSIDERS TO BE NECESSARY. 97
(L) "RBC LEVEL" MEANS A HEALTH INSURING CORPORATION'S 99
ACTION LEVEL RBC, REGULATORY ACTION LEVEL RBC, AUTHORIZED CONTROL 102
LEVEL RBC, OR MANDATORY CONTROL LEVEL RBC. 103
3
(M) "RBC PLAN" MEANS A COMPREHENSIVE FINANCIAL PLAN 105
CONTAINING THE ELEMENTS SPECIFIED IN DIVISION (B) OF SECTION 106
1753.33 OF THE REVISED CODE. 107
(N) "RBC REPORT" MEANS THE REPORT REQUIRED BY SECTION 109
1753.32 OF THE REVISED CODE. 110
(O) "REGULATORY ACTION LEVEL RBC" MEANS THE PRODUCT OF 1.5 112
AND A HEALTH INSURING CORPORATION'S AUTHORIZED CONTROL LEVEL RBC. 113
(P) "REVISED RBC PLAN" MEANS AN RBC PLAN REJECTED BY THE 115
SUPERINTENDENT OF INSURANCE AND THEN REVISED BY A HEALTH INSURING 116
CORPORATION WITH OR WITHOUT INCORPORATING THE SUPERINTENDENT'S 117
RECOMMENDATIONS. 118
(Q) "TOTAL ADJUSTED CAPITAL" MEANS THE SUM OF BOTH OF THE 120
FOLLOWING: 121
(1) A HEALTH INSURING CORPORATION'S NET WORTH AS 123
DETERMINED IN ACCORDANCE WITH THE STATUTORY ACCOUNTING APPLICABLE 124
TO THE ANNUAL FINANCIAL STATEMENTS REQUIRED TO BE FILED UNDER 125
SECTION 1751.32 OF THE REVISED CODE;
(2) SUCH OTHER ITEMS, IF ANY, AS THE RBC INSTRUCTIONS MAY 127
PROVIDE. 128
Sec. 1753.32. (A) EACH DOMESTIC HEALTH INSURING 130
CORPORATION SHALL, ON OR PRIOR TO THE FIRST DAY OF MARCH OF EVERY 131
YEAR, PREPARE AND SUBMIT TO THE SUPERINTENDENT OF INSURANCE A 132
REPORT ON ITS RBC LEVELS AS OF THE END OF THE CALENDAR YEAR JUST 133
ENDED, IN A FORM AND CONTAINING SUCH INFORMATION AS IS REQUIRED 134
BY THE RBC INSTRUCTIONS. IN ADDITION, A DOMESTIC HEALTH INSURING 136
CORPORATION SHALL FILE ITS RBC REPORT AS FOLLOWS:
(1) WITH THE NAIC, IN ACCORDANCE WITH THE RBC 139
INSTRUCTIONS;
(2) WITH THE INSURANCE REGULATORY AUTHORITY OF ANY OTHER 141
STATE IN WHICH THE HEALTH INSURING CORPORATION IS AUTHORIZED TO 142
DO BUSINESS, IF THE INSURANCE REGULATORY AUTHORITY OF THAT STATE 143
HAS SENT A WRITTEN REQUEST TO THE HEALTH INSURING CORPORATION FOR 144
THE RBC REPORT. THE HEALTH INSURING CORPORATION SHALL FILE AN 145
RBC REPORT WITH THE REQUESTING STATE NO LATER THAN THE LATER OF: 146
4
(a) FIFTEEN DAYS AFTER THE HEALTH INSURING CORPORATION'S 148
RECEIPT OF THE INSURANCE REGULATORY AUTHORITY'S REQUEST FOR THE 149
RBC REPORT; 150
(b) PRIOR TO THE FIRST DAY OF MARCH. 152
(B) A HEALTH INSURING CORPORATION'S RBC LEVELS SHALL BE 154
DETERMINED IN ACCORDANCE WITH THE FORMULA SET FORTH IN THE RBC 155
INSTRUCTIONS. THE FORMULA SHALL TAKE THE FOLLOWING RISKS INTO 156
ACCOUNT, AND MAY ADJUST FOR THE COVARIANCE BETWEEN THESE RISKS, 157
AS DETERMINED IN EACH CASE BY APPLYING THE FACTORS IN THE MANNER
SET FORTH IN THE RBC INSTRUCTIONS: 158
(1) ASSET RISK; 160
(2) CREDIT RISK; 162
(3) UNDERWRITING RISK; 164
(4) ALL OTHER BUSINESS RISKS AND SUCH OTHER RELEVANT RISKS 166
AS ARE SET FORTH IN THE RBC INSTRUCTIONS. 167
(C) IF A DOMESTIC HEALTH INSURING CORPORATION FILES AN RBC 170
REPORT THAT IN THE JUDGMENT OF THE SUPERINTENDENT IS INACCURATE, 171
THE SUPERINTENDENT SHALL ADJUST THE RBC REPORT TO CORRECT THE 172
INACCURACY AND THEN SHALL PROVIDE A COPY OF THE ADJUSTED RBC 173
REPORT TO THE HEALTH INSURING CORPORATION. THE SUPERINTENDENT 174
SHALL ALSO PROVIDE THE HEALTH INSURING CORPORATION WITH A 176
STATEMENT OF THE REASONS FOR ANY ADJUSTMENT.
(D) IN ENACTING SECTIONS 1753.31 TO 1753.43 OF THE REVISED 179
CODE, THE GENERAL ASSEMBLY FINDS ALL OF THE FOLLOWING: 180
(1) AN EXCESS OF CAPITAL OVER THE AMOUNT PRODUCED BY THE 182
RISK-BASED CAPITAL REQUIREMENTS OF SECTIONS 1753.31 TO 1753.43 OF 183
THE REVISED CODE, AND THE FORMULAS, SCHEDULES, AND INSTRUCTIONS 184
REFERENCED IN SECTIONS 1753.31 TO 1753.43 OF THE REVISED CODE, IS 185
DESIRABLE IN THE BUSINESS OF INSURANCE. 186
(2) HEALTH INSURING CORPORATIONS, ACCORDINGLY, SHOULD SEEK 188
TO MAINTAIN CAPITAL ABOVE THE RBC LEVELS REQUIRED BY SECTIONS 189
1753.31 TO 1753.43 OF THE REVISED CODE. 190
(3) ADDITIONAL CAPITAL IS USED AND IS USEFUL IN THE 192
BUSINESS OF INSURANCE, HELPING TO SECURE A HEALTH INSURING 193
5
CORPORATION AGAINST VARIOUS RISKS INHERENT IN, OR AFFECTING, THE 194
BUSINESS OF INSURANCE, WHICH RISKS ARE NOT ACCOUNTED FOR OR ARE 195
ONLY PARTIALLY MEASURED BY THE RISK-BASED CAPITAL REQUIREMENTS OF 196
SECTIONS 1753.31 TO 1753.43 OF THE REVISED CODE. 197
Sec. 1753.33. (A) FOR PURPOSES OF SECTIONS 1753.31 TO 199
1753.43 OF THE REVISED CODE, A "COMPANY ACTION LEVEL EVENT" IS 200
ANY OF THE FOLLOWING EVENTS: 201
(1) A HEALTH INSURING CORPORATION'S FILING OF AN RBC 203
REPORT THAT INDICATES THAT THE HEALTH INSURING CORPORATION'S 204
TOTAL ADJUSTED CAPITAL IS GREATER THAN OR EQUAL TO ITS REGULATORY 205
ACTION LEVEL RBC BUT LESS THAN ITS COMPANY ACTION LEVEL RBC; 206
(2) THE NOTIFICATION BY THE SUPERINTENDENT OF INSURANCE TO 208
A HEALTH INSURING CORPORATION OF AN ADJUSTMENT TO THE HEALTH 209
INSURING CORPORATION'S RBC REPORT, WHICH ADJUSTED RBC REPORT 210
SHOWS THE HEALTH INSURING CORPORATION'S TOTAL ADJUSTED CAPITAL 211
WITHIN THE RANGE DESCRIBED IN DIVISION (A)(1) OF THIS SECTION, 212
PROVIDED THAT THE HEALTH INSURING CORPORATION DOES NOT CHALLENGE 213
THE ADJUSTED RBC REPORT UNDER SECTION 1753.37 OF THE REVISED 215
CODE;
(3) THE NOTIFICATION BY THE SUPERINTENDENT TO A HEALTH 217
INSURING CORPORATION, FOLLOWING THE HEARING REQUIRED UNDER 218
SECTION 1753.37 OF THE REVISED CODE, THAT THE SUPERINTENDENT HAS 219
REJECTED THE HEALTH INSURING CORPORATION'S CHALLENGE TO AN 220
ADJUSTED RBC REPORT SHOWING THE HEALTH INSURING CORPORATION'S 221
TOTAL ADJUSTED CAPITAL WITHIN THE RANGE DESCRIBED IN DIVISION 222
(A)(1) OF THIS SECTION.
(B) IN THE CASE OF A COMPANY ACTION LEVEL EVENT, THE 224
HEALTH INSURING CORPORATION SHALL PREPARE AND SUBMIT TO THE 225
SUPERINTENDENT AN RBC PLAN THAT SHALL DO ALL OF THE FOLLOWING: 226
(1) IDENTIFY THE CONDITIONS THAT CONTRIBUTED TO THE 228
COMPANY ACTION LEVEL EVENT; 229
(2) CONTAIN PROPOSALS OF CORRECTIVE ACTIONS THAT THE 231
HEALTH INSURING CORPORATION INTENDS TO TAKE TO ELIMINATE THE 232
CONDITIONS CONTRIBUTING TO THE COMPANY ACTION LEVEL EVENT; 233
6
(3) PROVIDE PROJECTIONS OF THE HEALTH INSURING 235
CORPORATION'S FINANCIAL RESULTS IN THE CURRENT YEAR AND AT LEAST 236
THE TWO SUCCEEDING YEARS, BOTH IN THE ABSENCE OF THE PROPOSED 237
CORRECTIVE ACTIONS AND GIVING EFFECT TO THE PROPOSED CORRECTIVE 238
ACTIONS. THE PROJECTIONS SHALL INCLUDE PROJECTIONS OF STATUTORY 239
BALANCE SHEETS, OPERATING INCOME, NET INCOME, CAPITAL, SURPLUS,
AND RBC LEVELS. PROJECTIONS FOR BOTH NEW AND RENEWAL BUSINESS 241
MAY INCLUDE SEPARATE PROJECTIONS FOR EACH MAJOR LINE OF BUSINESS, 242
AND MAY SEPARATELY IDENTIFY EACH SIGNIFICANT INCOME, EXPENSE, AND 243
BENEFIT COMPONENT OF THE PROJECTION.
(4) IDENTIFY THE KEY ASSUMPTIONS IMPACTING THE HEALTH 245
INSURING CORPORATION'S PROJECTIONS MADE PURSUANT TO DIVISION 246
(B)(3) OF THIS SECTION, AND DESCRIBE THE SENSITIVITY OF THE 247
PROJECTIONS TO THE ASSUMPTIONS; 248
(5) IDENTIFY THE QUALITY OF, AND PROBLEMS ASSOCIATED WITH, 250
THE HEALTH INSURING CORPORATION'S BUSINESS, INCLUDING, BUT NOT 251
LIMITED TO, ITS ASSETS, ANTICIPATED BUSINESS GROWTH AND 252
ASSOCIATED SURPLUS STRAIN, EXTRAORDINARY EXPOSURE TO RISK, MIX OF 253
BUSINESS, AND THE USE OF REINSURANCE, IF ANY, IN EACH CASE. 254
(C) THE RBC PLAN SHALL BE SUBMITTED WITHIN FORTY-FIVE DAYS 256
AFTER A COMPANY ACTION LEVEL EVENT. HOWEVER, IF A HEALTH 257
INSURING CORPORATION HAS CHALLENGED AN ADJUSTED RBC REPORT 258
PURSUANT TO SECTION 1753.37 OF THE REVISED CODE, AN RBC PLAN NEED 259
NOT BE SUBMITTED UNLESS THE SUPERINTENDENT REJECTS THE CHALLENGE 260
FOLLOWING THE HEARING REQUIRED UNDER SECTION 1753.37 OF THE 261
REVISED CODE. IF THE SUPERINTENDENT REJECTS THE HEALTH INSURING 262
CORPORATION'S CHALLENGE, THE RBC PLAN SHALL BE SUBMITTED WITHIN 263
FORTY-FIVE DAYS AFTER THE SUPERINTENDENT'S NOTIFICATION TO THE 264
HEALTH INSURING CORPORATION OF THE SUPERINTENDENT'S REJECTION OF 265
THE CHALLENGE.
(D)(1) WITHIN SIXTY DAYS AFTER A HEALTH INSURING 267
CORPORATION SUBMITS AN RBC PLAN TO THE SUPERINTENDENT, THE 268
SUPERINTENDENT SHALL EITHER REQUIRE THE HEALTH INSURING 269
CORPORATION TO IMPLEMENT THE RBC PLAN OR NOTIFY THE HEALTH 270
7
INSURING CORPORATION THAT THE RBC PLAN IS UNSATISFACTORY IN THE 271
JUDGMENT OF THE SUPERINTENDENT. IF THE SUPERINTENDENT HAS 272
DETERMINED THAT THE RBC PLAN IS UNSATISFACTORY, THE NOTIFICATION 273
TO THE HEALTH INSURING CORPORATION SHALL SET FORTH THE REASONS 275
FOR THE DETERMINATION, AND MAY SET FORTH PROPOSED REVISIONS THAT
WILL RENDER THE RBC PLAN SATISFACTORY IN THE JUDGMENT OF THE 277
SUPERINTENDENT. UPON ITS RECEIPT OF SUCH NOTIFICATION FROM THE
SUPERINTENDENT, THE HEALTH INSURING CORPORATION SHALL PREPARE AND 279
SUBMIT A REVISED RBC PLAN, WHICH MAY INCORPORATE BY REFERENCE ANY 280
REVISIONS PROPOSED BY THE SUPERINTENDENT. 281
(2) IF A HEALTH INSURING CORPORATION CHALLENGES, UNDER 283
SECTION 1753.37 OF THE REVISED CODE, A NOTIFICATION BY THE 284
SUPERINTENDENT THAT THE HEALTH INSURING CORPORATION'S RBC PLAN OR 285
A REVISED RBC PLAN IS UNSATISFACTORY, SUBMISSION OF A REVISED RBC 286
PLAN NEED NOT BE MADE UNLESS THE SUPERINTENDENT REJECTS THE 287
HEALTH INSURING CORPORATION'S CHALLENGE AND NOTIFIES THE HEALTH 288
INSURING CORPORATION OF THIS REJECTION. A HEALTH INSURING 289
CORPORATION SHALL SUBMIT A REVISED RBC PLAN TO THE SUPERINTENDENT 290
WITHIN FORTY-FIVE DAYS AFTER RECEIVING NOTIFICATION FROM THE 291
SUPERINTENDENT THAT ITS RBC PLAN IS UNSATISFACTORY, OR THAT ITS 292
CHALLENGE TO A NOTIFICATION MADE UNDER DIVISION (D)(1) OF THIS 293
SECTION HAS BEEN REJECTED, AS APPLICABLE.
(E) NOTWITHSTANDING DIVISION (D) OF THIS SECTION, IF THE 295
SUPERINTENDENT NOTIFIES A HEALTH INSURING CORPORATION THAT ITS 296
RBC PLAN OR REVISED RBC PLAN IS UNSATISFACTORY, THE 297
SUPERINTENDENT MAY, AT THE SUPERINTENDENT'S DISCRETION BUT 298
SUBJECT TO THE HEALTH INSURING CORPORATION'S RIGHT TO A HEARING 299
UNDER SECTION 1753.37 OF THE REVISED CODE, SPECIFY IN THE
NOTIFICATION THAT THE NOTIFICATION CONSTITUTES A REGULATORY 300
ACTION LEVEL EVENT. 301
(F) EVERY DOMESTIC HEALTH INSURING CORPORATION THAT 303
SUBMITS AN RBC PLAN OR REVISED RBC PLAN TO THE SUPERINTENDENT 304
SHALL FILE A COPY OF THE RBC PLAN OR REVISED RBC PLAN WITH THE 305
INSURANCE REGULATORY AUTHORITY OF EVERY STATE IN WHICH THE HEALTH 306
8
INSURING CORPORATION IS AUTHORIZED TO DO BUSINESS UPON RECEIVING
THE INSURANCE REGULATORY AUTHORITY'S WRITTEN REQUEST FOR A COPY 307
OF THE PLAN, IF THE STATE HAS A CONFIDENTIALITY LAW SUBSTANTIALLY 308
SIMILAR TO SECTION 1753.38 OF THE REVISED CODE. THE HEALTH 309
INSURING CORPORATION SHALL FILE THE COPY IN THAT STATE NO LATER 310
THAN THE LATER OF: 311
(1) FIFTEEN DAYS AFTER RECEIVING THE REQUEST FOR A COPY OF 313
THE PLAN; 314
(2) THE DATE ON WHICH THE RBC PLAN OR REVISED RBC PLAN IS 316
FILED PURSUANT TO DIVISION (C) OR (D) OF THIS SECTION. 317
Sec. 1753.34. (A) FOR PURPOSES OF SECTIONS 1753.31 TO 319
1753.43 OF THE REVISED CODE, A "REGULATORY ACTION LEVEL EVENT" IS 320
ANY OF THE FOLLOWING EVENTS: 321
(1) THE FILING OF AN RBC REPORT BY A HEALTH INSURING 323
CORPORATION THAT INDICATES THAT THE HEALTH INSURING CORPORATION'S 324
TOTAL ADJUSTED CAPITAL IS GREATER THAN OR EQUAL TO ITS AUTHORIZED
CONTROL LEVEL RBC BUT LESS THAN ITS REGULATORY ACTION LEVEL RBC; 325
(2) THE NOTIFICATION BY THE SUPERINTENDENT OF INSURANCE TO 327
A HEALTH INSURING CORPORATION OF AN ADJUSTMENT TO THE HEALTH 328
INSURING CORPORATION'S RBC REPORT, WHICH ADJUSTED RBC REPORT 329
SHOWS THE HEALTH INSURING CORPORATION'S TOTAL ADJUSTED CAPITAL 330
WITHIN THE RANGE DESCRIBED IN DIVISION (A)(1) OF THIS SECTION, 331
PROVIDED THAT THE HEALTH INSURING CORPORATION DOES NOT CHALLENGE 332
THE ADJUSTED RBC REPORT UNDER SECTION 1753.37 OF THE REVISED 334
CODE;
(3) THE NOTIFICATION BY THE SUPERINTENDENT TO A HEALTH 336
INSURING CORPORATION, FOLLOWING THE HEARING REQUIRED UNDER 337
SECTION 1753.37 OF THE REVISED CODE, THAT THE SUPERINTENDENT HAS 338
REJECTED THE HEALTH INSURING CORPORATION'S CHALLENGE TO AN 339
ADJUSTED RBC REPORT SHOWING THE HEALTH INSURING CORPORATION'S 340
TOTAL ADJUSTED CAPITAL WITHIN THE RANGE DESCRIBED IN DIVISION 341
(A)(1) OF THIS SECTION;
(4) THE FAILURE OF A HEALTH INSURING CORPORATION TO FILE 343
AN RBC REPORT BY THE FIRST DAY OF MARCH OF EVERY YEAR, UNLESS THE 344
9
HEALTH INSURING CORPORATION HAS PROVIDED AN EXPLANATION FOR SUCH 345
FAILURE THAT IS SATISFACTORY TO THE SUPERINTENDENT AND HAS CURED 346
THE FAILURE WITHIN TEN DAYS AFTER THE FILING DATE; 347
(5) THE FAILURE OF A HEALTH INSURING CORPORATION TO SUBMIT 349
AN RBC PLAN TO THE SUPERINTENDENT WITHIN THE TIME PERIOD SET 350
FORTH IN DIVISION (C) OF SECTION 1753.33 OF THE REVISED CODE; 351
(6) THE NOTIFICATION BY THE SUPERINTENDENT TO A HEALTH 353
INSURING CORPORATION OF BOTH OF THE FOLLOWING: 354
(a) THE RBC PLAN OR REVISED RBC PLAN SUBMITTED BY THE 356
HEALTH INSURING CORPORATION IS UNSATISFACTORY IN THE JUDGMENT OF 357
THE SUPERINTENDENT; 358
(b) THE NOTIFICATION BY THE SUPERINTENDENT CONSTITUTES A 360
REGULATORY ACTION LEVEL EVENT WITH RESPECT TO THE HEALTH INSURING 361
CORPORATION, PROVIDED THAT THE HEALTH INSURING CORPORATION DOES 363
NOT CHALLENGE THE DETERMINATION UNDER SECTION 1753.37 OF THE 364
REVISED CODE.
(7) THE NOTIFICATION BY THE SUPERINTENDENT TO A HEALTH 366
INSURING CORPORATION, FOLLOWING THE HEARING REQUIRED UNDER 367
SECTION 1753.37 OF THE REVISED CODE, THAT THE SUPERINTENDENT HAS 368
REJECTED THE HEALTH INSURING CORPORATION'S CHALLENGE TO THE 370
SUPERINTENDENT'S DETERMINATION UNDER DIVISION (A)(6) OF THIS 371
SECTION;
(8) THE NOTIFICATION BY THE SUPERINTENDENT TO A HEALTH 373
INSURING CORPORATION THAT THE SUPERINTENDENT HAS DETERMINED THAT 374
THE HEALTH INSURING CORPORATION HAS FAILED TO ADHERE TO ITS RBC 375
PLAN OR REVISED RBC PLAN, AND THIS FAILURE HAS HAD A SUBSTANTIAL 376
ADVERSE EFFECT ON THE ABILITY OF THE HEALTH INSURING CORPORATION 377
TO ELIMINATE THE CONDITIONS LEADING TO THE COMPANY ACTION LEVEL 378
EVENT IN ACCORDANCE WITH ITS RBC PLAN OR REVISED RBC PLAN, 379
PROVIDED THAT THE HEALTH INSURING CORPORATION DOES NOT CHALLENGE 380
THIS DETERMINATION UNDER SECTION 1753.37 OF THE REVISED CODE; 381
(9) THE NOTIFICATION BY THE SUPERINTENDENT TO A HEALTH 383
INSURING CORPORATION, FOLLOWING THE HEARING REQUIRED UNDER 384
SECTION 1753.37 OF THE REVISED CODE, THAT THE SUPERINTENDENT HAS 385
10
REJECTED THE HEALTH INSURING CORPORATION'S CHALLENGE TO THE 386
SUPERINTENDENT'S DETERMINATION UNDER DIVISION (A)(8) OF THIS 387
SECTION.
(B) IN THE CASE OF A REGULATORY ACTION LEVEL EVENT, THE 389
SUPERINTENDENT SHALL DO ALL OF THE FOLLOWING: 390
(1) REQUIRE THE HEALTH INSURING CORPORATION TO PREPARE AND 392
SUBMIT AN RBC PLAN OR, IF APPLICABLE, A REVISED RBC PLAN; 393
(2) PERFORM SUCH EXAMINATIONS AND ANALYSES AS THE 395
SUPERINTENDENT CONSIDERS NECESSARY OF THE ASSETS, LIABILITIES, 396
AND OPERATIONS OF THE HEALTH INSURING CORPORATION, INCLUDING A 397
REVIEW OF THE HEALTH INSURING CORPORATION'S RBC PLAN OR REVISED 398
RBC PLAN AND THE RESULTS OF ANY SENSITIVITY TESTS UNDERTAKEN 400
PURSUANT TO THE RBC INSTRUCTIONS;
(3) ISSUE A CORRECTIVE ORDER, BASED UPON THE EXAMINATIONS 402
AND ANALYSES PERFORMED UNDER DIVISION (B)(2) OF THIS SECTION. 403
(C)(1) THE RBC PLAN OR REVISED RBC PLAN REQUIRED BY 406
DIVISION (B)(1) OF THIS SECTION SHALL BE SUBMITTED TO THE 408
SUPERINTENDENT WITHIN FORTY-FIVE DAYS AFTER THE REGULATORY ACTION 409
LEVEL EVENT, EXCEPT BY A HEALTH INSURING CORPORATION THAT FILES A 410
CHALLENGE TO AN ADJUSTED RBC REPORT OR REVISED RBC PLAN PURSUANT 411
TO SECTION 1753.37 OF THE REVISED CODE. IF THE SUPERINTENDENT 412
DETERMINES THE CHALLENGE IS FRIVOLOUS, THE TIME LIMIT FOR THE 413
SUBMISSION OF THE RBC PLAN OR REVISED RBC PLAN SHALL NOT BE 414
ALTERED BY THE FILING OF THE CHALLENGE.
(2) IF A HEALTH INSURING CORPORATION FILES A NONFRIVOLOUS 416
CHALLENGE TO AN ADJUSTED RBC REPORT OR REVISED RBC PLAN, THE RBC 417
PLAN OR REVISED RBC PLAN REQUIRED BY DIVISION (B)(1) OF THIS 418
SECTION SHALL ONLY BE SUBMITTED TO THE SUPERINTENDENT IF THE 419
SUPERINTENDENT REJECTS THE CHALLENGE FOLLOWING THE HEARING
REQUIRED UNDER SECTION 1753.37 OF THE REVISED CODE. IF THE 420
SUPERINTENDENT REJECTS THE HEALTH INSURING CORPORATION'S 421
CHALLENGE, THE RBC PLAN OR REVISED RBC PLAN SHALL BE SUBMITTED 422
WITHIN FORTY-FIVE DAYS AFTER THE SUPERINTENDENT'S NOTIFICATION TO 423
THE HEALTH INSURING CORPORATION OF THE SUPERINTENDENT'S REJECTION 424
11
OF THE CHALLENGE.
(D) THE SUPERINTENDENT MAY RETAIN ACTUARIES, INVESTMENT 426
EXPERTS, AND SUCH OTHER CONSULTANTS, AS MAY BE NECESSARY IN THE 427
SUPERINTENDENT'S JUDGMENT, TO REVIEW A HEALTH INSURING 428
CORPORATION'S RBC PLAN OR REVISED RBC PLAN, TO EXAMINE OR ANALYZE 429
THE ASSETS, LIABILITIES, AND OPERATION OF THE HEALTH INSURING 430
CORPORATION, AND TO FORMULATE A CORRECTIVE ORDER FOR THE HEALTH
INSURING CORPORATION. THE FEES, COSTS, AND EXPENSES RELATING TO 431
THESE CONSULTANTS SHALL BE BORNE BY THE AFFECTED HEALTH INSURING 432
CORPORATION. 433
Sec. 1753.35. (A) FOR PURPOSES OF SECTIONS 1753.31 TO 435
1753.43 OF THE REVISED CODE, AN "AUTHORIZED CONTROL LEVEL EVENT" 436
IS ANY OF THE FOLLOWING EVENTS: 437
(1) THE FILING OF AN RBC REPORT BY A HEALTH INSURING 439
CORPORATION THAT INDICATES THAT THE HEALTH INSURING CORPORATION'S 440
TOTAL ADJUSTED CAPITAL IS GREATER THAN OR EQUAL TO ITS MANDATORY
CONTROL LEVEL RBC BUT LESS THAN ITS AUTHORIZED CONTROL LEVEL RBC; 441
(2) THE NOTIFICATION BY THE SUPERINTENDENT OF INSURANCE TO 443
A HEALTH INSURING CORPORATION OF AN ADJUSTMENT TO THE HEALTH 444
INSURING CORPORATION'S RBC REPORT, WHICH ADJUSTED RBC REPORT 445
SHOWS THE HEALTH INSURING CORPORATION'S TOTAL ADJUSTED CAPITAL 446
WITHIN THE RANGE DESCRIBED IN DIVISION (A)(1) OF THIS SECTION, 447
PROVIDED THAT THE HEALTH INSURING CORPORATION DOES NOT CHALLENGE 448
THE ADJUSTED RBC REPORT UNDER SECTION 1753.37 OF THE REVISED 450
CODE;
(3) THE NOTIFICATION BY THE SUPERINTENDENT TO A HEALTH 452
INSURING CORPORATION, FOLLOWING THE HEARING REQUIRED UNDER 453
SECTION 1753.37 OF THE REVISED CODE, THAT THE SUPERINTENDENT HAS 454
REJECTED THE HEALTH INSURING CORPORATION'S CHALLENGE TO AN 455
ADJUSTED RBC REPORT SHOWING THE HEALTH INSURING CORPORATION'S 456
TOTAL ADJUSTED CAPITAL WITHIN THE RANGE DESCRIBED IN DIVISION 457
(A)(1) OF THIS SECTION;
(4) THE FAILURE OF A HEALTH INSURING CORPORATION TO 459
RESPOND, IN A MANNER SATISFACTORY TO THE SUPERINTENDENT, TO A 460
12
CORRECTIVE ORDER ISSUED UNDER DIVISION (B)(3) OF SECTION 1753.34 461
OF THE REVISED CODE, PROVIDED THAT THE HEALTH INSURING 463
CORPORATION DOES NOT CHALLENGE THE CORRECTIVE ORDER UNDER SECTION 465
1753.37 OF THE REVISED CODE; 466
(5) THE FAILURE OF A HEALTH INSURING CORPORATION TO 468
RESPOND, IN A MANNER SATISFACTORY TO THE SUPERINTENDENT, TO A 469
CORRECTIVE ORDER ISSUED UNDER DIVISION (B)(3) OF SECTION 1753.34 470
OF THE REVISED CODE SUBSEQUENT TO THE SUPERINTENDENT'S 472
MODIFICATION OF AN EARLIER ORDER OR THE SUPERINTENDENT'S 473
REJECTION OF THE HEALTH INSURING CORPORATION'S CHALLENGE OF THE 474
ORDER UNDER SECTION 1753.37 OF THE REVISED CODE. 475
(B) IN THE CASE OF AN AUTHORIZED CONTROL LEVEL EVENT, THE 477
SUPERINTENDENT SHALL DO THE FOLLOWING: 478
(1) TAKE THE ACTIONS REQUIRED UNDER SECTION 1753.34 OF THE 480
REVISED CODE FOR REGULATORY ACTION LEVEL EVENTS; 483
(2) IF THE SUPERINTENDENT CONSIDERS IT TO BE IN THE BEST 485
INTERESTS OF THE SUBSCRIBERS AND CREDITORS OF THE HEALTH INSURING 486
CORPORATION AND OF THE PUBLIC, TAKE SUCH ACTIONS AS ARE NECESSARY 487
TO PLACE THE HEALTH INSURING CORPORATION UNDER REGULATORY CONTROL 488
UNDER SECTIONS 3903.01 TO 3903.59 OF THE REVISED CODE. THE 489
AUTHORIZED CONTROL LEVEL EVENT SHALL BE DEEMED SUFFICIENT GROUNDS 490
FOR THE SUPERINTENDENT TO TAKE ACTION UNDER SECTIONS 3903.01 TO 491
3903.59 OF THE REVISED CODE. NOTHING IN SECTIONS 1753.31 TO 492
1753.43 OF THE REVISED CODE SHALL IMPAIR OR RESTRICT THE RIGHTS, 493
POWERS, AND PROTECTIONS AFFORDED TO THE SUPERINTENDENT AND TO 494
HEALTH INSURING CORPORATIONS UNDER SECTIONS 3903.01 TO 3903.59 OF 495
THE REVISED CODE. 496
Sec. 1753.36. (A) FOR PURPOSES OF SECTIONS 1753.31 TO 498
1753.43 OF THE REVISED CODE, A "MANDATORY CONTROL LEVEL EVENT" IS 499
ANY OF THE FOLLOWING EVENTS: 500
(1) THE FILING OF AN RBC REPORT BY A HEALTH INSURING 502
CORPORATION THAT INDICATES THAT THE HEALTH INSURING CORPORATION'S 503
TOTAL ADJUSTED CAPITAL IS LESS THAN ITS MANDATORY CONTROL LEVEL 504
RBC;
13
(2) THE NOTIFICATION BY THE SUPERINTENDENT OF INSURANCE TO 506
A HEALTH INSURING CORPORATION OF AN ADJUSTMENT TO THE HEALTH 507
INSURING CORPORATION'S RBC REPORT, WHICH ADJUSTED RBC REPORT 508
SHOWS THE HEALTH INSURING CORPORATION'S TOTAL ADJUSTED CAPITAL AT 509
LESS THAN ITS MANDATORY CONTROL LEVEL RBC, PROVIDED THE HEALTH 510
INSURING CORPORATION DOES NOT CHALLENGE THE ADJUSTED RBC REPORT 511
UNDER SECTION 1753.37 OF THE REVISED CODE; 512
(3) THE NOTIFICATION BY THE SUPERINTENDENT TO THE HEALTH 514
INSURING CORPORATION, FOLLOWING THE HEARING REQUIRED UNDER 515
SECTION 1753.37 OF THE REVISED CODE, THAT THE SUPERINTENDENT HAS 516
REJECTED THE HEALTH INSURING CORPORATION'S CHALLENGE TO AN 517
ADJUSTED RBC REPORT.
(B) IN THE CASE OF A MANDATORY CONTROL LEVEL EVENT, THE 519
SUPERINTENDENT SHALL TAKE SUCH ACTIONS AS ARE NECESSARY TO PLACE 520
THE HEALTH INSURING CORPORATION UNDER REGULATORY CONTROL UNDER 521
SECTIONS 3903.01 TO 3903.59 OF THE REVISED CODE. THE MANDATORY 522
CONTROL LEVEL EVENT SHALL BE DEEMED SUFFICIENT GROUNDS FOR THE 523
SUPERINTENDENT TO TAKE ACTION UNDER SECTIONS 3903.01 TO 3903.59 524
OF THE REVISED CODE. NOTHING IN SECTIONS 1753.31 TO 1753.43 OF 525
THE REVISED CODE SHALL IMPAIR OR RESTRICT THE RIGHTS, POWERS, AND 526
PROTECTIONS AFFORDED TO THE SUPERINTENDENT AND TO HEALTH INSURING
CORPORATIONS UNDER SECTIONS 3903.01 TO 3903.59 OF THE REVISED 527
CODE. HOWEVER, THE SUPERINTENDENT MAY DEFER ACTION UNDER THIS 528
DIVISION FOR UP TO NINETY DAYS AFTER THE MANDATORY CONTROL LEVEL 529
EVENT IF THE SUPERINTENDENT FINDS THAT THERE IS A REASONABLE 530
EXPECTATION THE HEALTH INSURING CORPORATION MAY BE ABLE TO 531
ELIMINATE THE CONDITIONS LEADING TO THE MANDATORY CONTROL LEVEL 532
EVENT WITHIN THE NINETY-DAY PERIOD.
Sec. 1753.37. (A) A HEALTH INSURING CORPORATION HAS THE 534
RIGHT TO A CONFIDENTIAL HEARING UPON RECEIVING ANY OF THE 535
FOLLOWING FROM THE SUPERINTENDENT OF INSURANCE: 536
(1) AN ADJUSTED RBC REPORT; 538
(2) NOTIFICATION THAT THE HEALTH INSURING CORPORATION'S 540
RBC PLAN OR REVISED RBC PLAN IS UNSATISFACTORY AND A STATEMENT 541
14
THAT THE NOTIFICATION CONSTITUTES A REGULATORY ACTION LEVEL EVENT 542
FOR THE HEALTH INSURING CORPORATION; 543
(3) NOTIFICATION THAT THE SUPERINTENDENT HAS DETERMINED 545
THAT THE HEALTH INSURING CORPORATION HAS FAILED TO ADHERE TO ITS 546
RBC PLAN OR REVISED RBC PLAN, WHICH FAILURE HAS A SUBSTANTIAL 547
ADVERSE EFFECT ON THE ABILITY OF THE HEALTH INSURING CORPORATION 548
TO ELIMINATE THE CONDITIONS LEADING TO A COMPANY ACTION LEVEL 550
EVENT IN ACCORDANCE WITH ITS RBC PLAN OR REVISED RBC PLAN; 551
(4) A CORRECTIVE ORDER ISSUED UNDER DIVISION (B)(3) OF 553
SECTION 1753.34 OF THE REVISED CODE. 554
(B) A HEALTH INSURING CORPORATION SHALL NOTIFY THE 556
SUPERINTENDENT OF ITS REQUEST FOR A HEARING WITHIN FIVE DAYS 557
AFTER ITS RECEIPT OF ANY ITEM LISTED IN DIVISION (A) OF THIS 558
SECTION. UPON THE SUPERINTENDENT'S RECEIPT OF THE HEALTH 559
INSURING CORPORATION'S REQUEST FOR A HEARING, THE SUPERINTENDENT 560
SHALL SET A DATE FOR THE HEARING, WHICH DATE SHALL BE NO LESS 561
THAN TEN DAYS AND NO MORE THAN THIRTY DAYS AFTER THE
SUPERINTENDENT'S RECEIPT OF THE HEALTH INSURING CORPORATION'S 562
REQUEST. 563
(C) A HEALTH INSURING CORPORATION MAY CHALLENGE ANY 565
DETERMINATION OR ACTION TAKEN BY THE SUPERINTENDENT UNDER 566
SECTIONS 1753.31 TO 1753.43 OF THE REVISED CODE AT THE HEARING 567
HELD PURSUANT TO THIS SECTION. 568
Sec. 1753.38. (A) THE SUPERINTENDENT OF INSURANCE SHALL 570
KEEP ALL OF THE FOLLOWING CONFIDENTIAL: 571
(1) AN RBC REPORT, TO THE EXTENT THAT INFORMATION 573
CONTAINED IN THE REPORT IS NOT REQUIRED TO BE INCLUDED IN AN 574
ANNUAL STATEMENT AVAILABLE TO THE PUBLIC; 575
(2) AN RBC PLAN; 577
(3) THE RESULTS OF, OR REPORTS ON, EXAMINATIONS OR 579
ANALYSES CONDUCTED PURSUANT TO DIVISION (B)(2) OF SECTION 1753.34 580
OF THE REVISED CODE, AND A CORRECTIVE ORDER ISSUED PURSUANT TO 582
DIVISION (B)(3) OF SECTION 1753.34 OF THE REVISED CODE. 583
A DISCLOSURE TO THE SUPERINTENDENT OF THESE PLANS, REPORTS, 585
15
INFORMATION, AND ORDERS DOES NOT CONSTITUTE A WAIVER OF ANY 586
APPLICABLE PRIVILEGE OR CLAIM OF CONFIDENTIALITY IN THE PLANS, 587
REPORTS, INFORMATION, AND ORDERS. 588
(B) NOTWITHSTANDING DIVISION (A) OF THIS SECTION: 590
(1) THE PLANS, REPORTS, INFORMATION, AND ORDERS DESCRIBED 592
IN DIVISION (A) OF THIS SECTION MAY BE USED BY THE SUPERINTENDENT 593
IN ACCORDANCE WITH THE INSURANCE LAWS OF THIS STATE. 594
(2) IN THE PERFORMANCE OF THE SUPERINTENDENT'S DUTIES, THE 596
SUPERINTENDENT MAY SHARE THE PLANS, REPORTS, INFORMATION, AND 597
ORDERS WITH STATE, FEDERAL, AND INTERNATIONAL REGULATORY AGENCIES 598
AND LAW ENFORCEMENT AUTHORITIES, AND WITH THE NAIC AND ITS 599
AFFILIATES AND SUBSIDIARIES, PROVIDED THAT THE RECIPIENT AGREES 600
TO MAINTAIN THE CONFIDENTIALITY OF THE PLANS, REPORTS, 601
INFORMATION, AND ORDERS. 602
(C)(1) THE PLANS, REPORTS, INFORMATION, AND ORDERS 604
DESCRIBED IN DIVISION (A) OF THIS SECTION ARE NOT PUBLIC RECORDS 605
FOR PURPOSES OF SECTION 149.43 OF THE REVISED CODE AND SHALL NOT 606
BE SUBJECT TO SUBPOENA. THE PLANS, REPORTS, INFORMATION, AND 608
ORDERS SHALL NOT BE SUBJECT TO DISCOVERY OR ADMISSIBLE IN 609
EVIDENCE IN ANY PRIVATE CIVIL ACTION. 610
(2) NEITHER THE SUPERINTENDENT NOR ANY PERSON WHO RECEIVES 612
THE PLANS, REPORTS, INFORMATION, AND ORDERS WHILE ACTING UNDER 613
THE AUTHORITY OF THE SUPERINTENDENT SHALL BE PERMITTED OR 614
REQUIRED TO TESTIFY IN ANY PRIVATE CIVIL ACTION CONCERNING THESE 615
PLANS, REPORTS, INFORMATION, AND ORDERS. 616
(D) A COMPARISON OF A HEALTH INSURING CORPORATION'S TOTAL 618
ADJUSTED CAPITAL TO ANY OF ITS RBC LEVELS SHALL NOT BE USED TO 619
RANK HEALTH INSURING CORPORATIONS. 620
(E) RBC INSTRUCTIONS, RBC REPORTS, ADJUSTED RBC REPORTS, 623
RBC PLANS, AND REVISED RBC PLANS SHALL NOT BE USED BY THE 624
SUPERINTENDENT FOR RATEMAKING, CONSIDERED OR INTRODUCED AS 625
EVIDENCE IN ANY RATE PROCEEDING, OR USED BY THE SUPERINTENDENT TO 626
CALCULATE OR DERIVE ANY ELEMENTS OF AN APPROPRIATE PREMIUM LEVEL 627
OR RATE OF RETURN FOR ANY LINE OF INSURANCE THAT A HEALTH 628
16
INSURING CORPORATION OR ANY AFFILIATE IS AUTHORIZED TO WRITE. 629
(F) EXCEPT AS OTHERWISE REQUIRED UNDER CHAPTER 1751. OR 631
1753. OF THE REVISED CODE, IT IS AN UNFAIR AND DECEPTIVE ACT OR 633
PRACTICE IN THE BUSINESS OF INSURANCE UNDER SECTIONS 3901.19 TO 635
3901.26 OF THE REVISED CODE FOR ANY PERSON TO MAKE, PUBLISH, 636
DISSEMINATE, CIRCULATE, OR PLACE BEFORE THE PUBLIC, OR TO CAUSE, 638
DIRECTLY OR INDIRECTLY, TO BE MADE, PUBLISHED, DISSEMINATED,
CIRCULATED, OR PLACED BEFORE THE PUBLIC, IN A NEWSPAPER, 639
MAGAZINE, OR OTHER PUBLICATION, IN THE FORM OF A NOTICE, 640
CIRCULAR, PAMPHLET, LETTER, OR POSTER, OR OVER ANY RADIO OR 641
TELEVISION STATION, OR IN ANY OTHER MANNER, AN ADVERTISEMENT, 642
ANNOUNCEMENT, OR STATEMENT, WRITTEN OR ORAL, THAT CONTAINS AN 643
ASSERTION, REPRESENTATION, OR STATEMENT, REGARDING THE RBC LEVELS 644
OF A HEALTH INSURING CORPORATION, OR ANY COMPONENT DERIVED IN THE 645
CALCULATION OF THE RBC LEVELS.
(G) IF ANY MATERIALLY FALSE STATEMENT IS PUBLISHED 647
COMPARING A HEALTH INSURING CORPORATION'S TOTAL ADJUSTED CAPITAL 648
TO ITS RBC LEVELS, OR ANY INAPPROPRIATE COMPARISON OF ANY OTHER 649
AMOUNT TO ANY OF THE HEALTH INSURING CORPORATION'S RBC LEVELS IS 650
PUBLISHED, AND THE HEALTH INSURING CORPORATION IS ABLE TO 651
DEMONSTRATE TO THE SUPERINTENDENT WITH SUBSTANTIAL PROOF THE 652
FALSITY OF THE STATEMENT OR THE INAPPROPRIATENESS OF THE
COMPARISON, THEN THE HEALTH INSURING CORPORATION MAY PUBLISH WITH 653
THE SUPERINTENDENT'S APPROVAL AN ANNOUNCEMENT IN A WRITTEN 654
PUBLICATION TO REBUT THE MATERIALLY FALSE STATEMENT OR 655
INAPPROPRIATE COMPARISON. 656
Sec. 1753.39. (A) EACH FOREIGN HEALTH INSURING 658
CORPORATION SHALL SUBMIT TO THE SUPERINTENDENT OF INSURANCE, UPON 659
RECEIVING THE SUPERINTENDENT'S WRITTEN REQUEST, AN RBC REPORT FOR 660
THE CALENDAR YEAR JUST ENDED. THE HEALTH INSURING CORPORATION 661
SHALL SUBMIT THE RBC REPORT TO THE SUPERINTENDENT NO LATER THAN 662
THE LATER OF:
(1) THE DATE A DOMESTIC HEALTH INSURING CORPORATION WOULD 664
BE REQUIRED TO FILE AN RBC REPORT UNDER SECTION 1753.32 OF THE 666
17
REVISED CODE;
(2) FIFTEEN DAYS AFTER THE SUPERINTENDENT'S REQUEST IS 668
RECEIVED BY THE FOREIGN HEALTH INSURING CORPORATION. 669
(B) EACH FOREIGN HEALTH INSURING CORPORATION SHALL, UPON 671
RECEIVING THE SUPERINTENDENT'S WRITTEN REQUEST, PROMPTLY SUBMIT 672
TO THE SUPERINTENDENT A COPY OF ANY RBC PLAN OR REVISED RBC PLAN 673
FILED WITH THE INSURANCE REGULATORY AUTHORITY OF ANY OTHER STATE. 674
(C) THE SUPERINTENDENT MAY REQUIRE A FOREIGN HEALTH 676
INSURING CORPORATION TO FILE AN RBC PLAN WITH THE SUPERINTENDENT 677
IN THE CASE OF A COMPANY ACTION LEVEL EVENT, REGULATORY ACTION 678
LEVEL EVENT, OR AUTHORIZED CONTROL LEVEL EVENT INVOLVING THE 679
FOREIGN HEALTH INSURING CORPORATION, IF THE INSURANCE REGULATORY 680
AUTHORITY OF THE STATE OF DOMICILE OF THE FOREIGN HEALTH INSURING 681
CORPORATION FAILS TO REQUIRE THE FOREIGN HEALTH INSURING 682
CORPORATION TO FILE AN RBC PLAN IN THE MANNER SPECIFIED UNDER 683
THAT STATE'S RBC LAWS, IF ANY. THE FAILURE OF A FOREIGN HEALTH 684
INSURING CORPORATION TO FILE AN RBC PLAN OR REVISED RBC PLAN WITH 685
THE SUPERINTENDENT AS REQUIRED SHALL BE GROUNDS FOR THE 686
SUPERINTENDENT TO ORDER THE HEALTH INSURING CORPORATION TO CEASE
AND DESIST FROM WRITING NEW BUSINESS IN THIS STATE. 687
(D) IN THE CASE OF A MANDATORY CONTROL LEVEL EVENT 689
INVOLVING A FOREIGN HEALTH INSURING CORPORATION, IF NO 690
DOMICILIARY RECEIVER HAS BEEN APPOINTED FOR THE FOREIGN HEALTH 691
INSURING CORPORATION UNDER THE REHABILITATION AND LIQUIDATION 692
LAWS APPLICABLE IN THE STATE OF DOMICILE OF THE FOREIGN HEALTH 693
INSURING CORPORATION, THE SUPERINTENDENT MAY MAKE APPLICATION TO 694
THE COURT OF COMMON PLEAS AS PERMITTED IN SECTIONS 3903.50 TO 695
3903.59 OF THE REVISED CODE FOR AN ORDER DIRECTING THE 696
SUPERINTENDENT TO LIQUIDATE THE PROPERTY OF THE FOREIGN HEALTH
INSURING CORPORATION FOUND IN THIS STATE. THE OCCURRENCE OF THE 697
MANDATORY CONTROL LEVEL EVENT SHALL BE DEEMED SUFFICIENT GROUNDS 698
FOR THE SUPERINTENDENT TO MAKE APPLICATION TO THE COURT. 699
Sec. 1753.40. THERE SHALL BE NO LIABILITY ON THE PART OF, 701
AND NO CAUSE OF ACTION SHALL ARISE AGAINST, THE SUPERINTENDENT OF 702
18
INSURANCE, OR THE DEPARTMENT OF INSURANCE, ITS EMPLOYEES, OR ITS 703
AGENTS, FOR ANY ACTION TAKEN IN THEIR PERFORMANCE OF THE POWERS 704
AND DUTIES UNDER SECTIONS 1753.31 TO 1753.43 OF THE REVISED CODE. 705
Sec. 1753.41. UNLESS OTHERWISE PROVIDED, ALL NOTICES SENT 707
TO A HEALTH INSURING CORPORATION BY THE SUPERINTENDENT OF 708
INSURANCE THAT MAY RESULT IN REGULATORY ACTION UNDER SECTIONS 709
1753.31 TO 1753.43 OF THE REVISED CODE SHALL BE EFFECTIVE UPON 710
DISPATCH IF TRANSMITTED BY REGISTERED OR CERTIFIED MAIL. ANY 711
OTHER NOTICE TRANSMITTED SHALL BE EFFECTIVE UPON THE HEALTH
INSURING CORPORATION'S RECEIPT OF THE NOTICE. 712
Sec. 1753.42. THE SUPERINTENDENT OF INSURANCE MAY EXEMPT 714
ANY DOMESTIC HEALTH INSURING CORPORATION FROM THE APPLICATION OF 715
SECTIONS 1753.31 TO 1753.43 OF THE REVISED CODE, IF THE HEALTH 716
INSURING CORPORATION MEETS ALL OF THE FOLLOWING REQUIREMENTS: 717
(A) THE HEALTH INSURING CORPORATION WRITES DIRECT BUSINESS 719
IN THIS STATE ONLY. 720
(B) THE HEALTH INSURING CORPORATION ASSUMES NO REINSURANCE 722
IN EXCESS OF FIVE PER CENT OF DIRECT PREMIUM WRITTEN. 723
(C) THE HEALTH INSURING CORPORATION EITHER: 725
(1) WRITES DIRECT ANNUAL PREMIUMS OF TWO MILLION DOLLARS 727
OR LESS FOR BASIC HEALTH CARE SERVICES; 728
(2) COVERS LESS THAN TWO THOUSAND ENROLLEES UNDER 730
POLICIES, CONTRACTS, CERTIFICATES, OR AGREEMENTS FOR SUPPLEMENTAL 731
HEALTH CARE SERVICES. 732
Sec. 1753.43. THE SUPERINTENDENT OF INSURANCE MAY ADOPT 734
RULES IN ACCORDANCE WITH CHAPTER 119. OF THE REVISED CODE AS ARE 735
REASONABLY NECESSARY FOR THE IMPLEMENTATION AND OPERATION OF 736
SECTIONS 1753.31 TO 1753.43 OF THE REVISED CODE. 737
Section 2. That existing section 1753.01 of the Revised 739
Code is hereby repealed. 740
Section 3. The authorized control level RBC, as defined by 742
division (B) of section 1753.31 of the Revised Code, as enacted 743
by this act, shall be adjusted for use in reports filed for 744
periods through December 31, 2002. Notwithstanding division (B) 745
19
of section 1753.31 of the Revised Code, the authorized control 746
level RBC for use in reports filed for the period ending December 747
31, 2001, shall be the product of 0.80 and the number determined 748
under the risk-based capital formula in accordance with the RBC 749
instructions; the authorized control level RBC for use in reports 750
filed for the period ending December 31, 2002, shall be the 751
product of 0.90 and the number determined under the risk-based 752
capital formula in accordance with the RBC instructions. 753
Thereafter, the authorized control level RBC shall be determined 754
in accordance with division (B) of section 1753.31 of the Revised 755
Code without this adjustment.