As Passed by the Senate 1
123rd General Assembly 4
Regular Session Am. H. B. No. 714 5
1999-2000 6
REPRESENTATIVES EVANS-NETZLEY-GOODMAN-BRITTON-JONES- 8
SMITH-BENDER-SCHURING-JOLIVETTE-WILLAMOWSKI-CLANCY- 9
GARDNER-HOLLISTER-WINKLER-TIBERI-BUCHY-O'BRIEN-SALERNO- 11
SENATORS HOTTINGER-NEIN-WACHTMANN-SPADA
_________________________________________________________________ 13
A B I L L
To amend section 1753.01 and to enact sections 15
1753.31 to 1753.43 of the Revised Code to apply, 16
with modifications, the National Association of 17
Insurance Commissioners' Risk-Based Capital for
Insurers Model Act to health insuring 18
corporations.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO: 20
Section 1. That section 1753.01 be amended and sections 22
1753.31, 1753.32, 1753.33, 1753.34, 1753.35, 1753.36, 1753.37, 23
1753.38, 1753.39, 1753.40, 1753.41, 1753.42, and 1753.43 of the 24
Revised Code be enacted to read as follows: 25
Sec. 1753.01. As used in this chapter: 34
(A) "Economic profiling" means a health insuring 36
corporation's use of economic performance data and economic 37
information in determining whether to contract with a provider 38
for the provision of covered health care services to enrollees as 40
a participating provider.
(B) "Basic health care services," "enrollee," "health care 42
facility," "health care services," "health insuring corporation," 43
"medical record," "PERSON," "PRIMARY CARE PROVIDER," "provider," 45
and "SUBSCRIBER," AND "supplemental health care services" have 47
the same meanings as in section 1751.01 of the Revised Code. 49
Sec. 1753.31. AS USED IN SECTIONS 1753.31 TO 1753.43 OF 51
2
THE REVISED CODE: 53
(A) "ADJUSTED RBC REPORT" MEANS AN RBC REPORT THAT HAS 56
BEEN ADJUSTED BY THE SUPERINTENDENT OF INSURANCE IN ACCORDANCE 57
WITH DIVISION (C) OF SECTION 1753.32 OF THE REVISED CODE. 58
(B) "AUTHORIZED CONTROL LEVEL RBC" MEANS THE NUMBER 60
DETERMINED UNDER THE RISK-BASED CAPITAL FORMULA IN ACCORDANCE 62
WITH THE RBC INSTRUCTIONS. 63
(C) "COMPANY ACTION LEVEL RBC" MEANS THE PRODUCT OF 2.0 65
AND A HEALTH INSURING CORPORATION'S AUTHORIZED CONTROL LEVEL RBC. 66
(D) "CORRECTIVE ORDER" MEANS AN ORDER ISSUED BY THE 68
SUPERINTENDENT OF INSURANCE SPECIFYING CORRECTIVE ACTIONS THAT 69
THE SUPERINTENDENT DETERMINES ARE REQUIRED. 70
(E) "DOMESTIC HEALTH INSURING CORPORATION" MEANS A HEALTH 72
INSURING CORPORATION DOMICILED IN THIS STATE. 73
(F) "FOREIGN HEALTH INSURING CORPORATION" MEANS A HEALTH 75
INSURING CORPORATION HOLDING A CERTIFICATE OF AUTHORITY UNDER 76
CHAPTER 1751. OF THE REVISED CODE THAT IS DOMICILED OUTSIDE OF 77
THIS STATE.
(G) "MANDATORY CONTROL LEVEL RBC" MEANS THE PRODUCT OF .70 79
AND A HEALTH INSURING CORPORATION'S AUTHORIZED CONTROL LEVEL RBC. 80
(H) "NAIC" MEANS THE NATIONAL ASSOCIATION OF INSURANCE 82
COMMISSIONERS. 83
(I) "NET WORTH" MEANS STATUTORY CAPITAL AND SURPLUS. 85
(J) "RBC" MEANS RISK-BASED CAPITAL. 87
(K) "RBC INSTRUCTIONS" MEANS THE RBC REPORT, INCLUDING 90
RISK-BASED CAPITAL INSTRUCTIONS, AS ADOPTED BY THE NAIC AND AS 91
AMENDED BY THE NAIC FROM TIME TO TIME IN ACCORDANCE WITH THE 92
PROCEDURES ADOPTED BY THE NAIC. "RBC INSTRUCTIONS" ALSO INCLUDES 93
ANY MODIFICATIONS ADOPTED BY THE SUPERINTENDENT OF INSURANCE, AS 94
THE SUPERINTENDENT CONSIDERS TO BE NECESSARY. 96
(L) "RBC LEVEL" MEANS A HEALTH INSURING CORPORATION'S 98
ACTION LEVEL RBC, REGULATORY ACTION LEVEL RBC, AUTHORIZED CONTROL 101
LEVEL RBC, OR MANDATORY CONTROL LEVEL RBC. 102
(M) "RBC PLAN" MEANS A COMPREHENSIVE FINANCIAL PLAN 104
3
CONTAINING THE ELEMENTS SPECIFIED IN DIVISION (B) OF SECTION 105
1753.33 OF THE REVISED CODE. 106
(N) "RBC REPORT" MEANS THE REPORT REQUIRED BY SECTION 108
1753.32 OF THE REVISED CODE. 109
(O) "REGULATORY ACTION LEVEL RBC" MEANS THE PRODUCT OF 1.5 111
AND A HEALTH INSURING CORPORATION'S AUTHORIZED CONTROL LEVEL RBC. 112
(P) "REVISED RBC PLAN" MEANS AN RBC PLAN REJECTED BY THE 114
SUPERINTENDENT OF INSURANCE AND THEN REVISED BY A HEALTH INSURING 115
CORPORATION WITH OR WITHOUT INCORPORATING THE SUPERINTENDENT'S 116
RECOMMENDATIONS. 117
(Q) "TOTAL ADJUSTED CAPITAL" MEANS THE SUM OF BOTH OF THE 119
FOLLOWING: 120
(1) A HEALTH INSURING CORPORATION'S NET WORTH AS 122
DETERMINED IN ACCORDANCE WITH THE STATUTORY ACCOUNTING APPLICABLE 123
TO THE ANNUAL FINANCIAL STATEMENTS REQUIRED TO BE FILED UNDER 124
SECTION 1751.32 OF THE REVISED CODE;
(2) SUCH OTHER ITEMS, IF ANY, AS THE RBC INSTRUCTIONS MAY 126
PROVIDE. 127
Sec. 1753.32. (A) EACH DOMESTIC HEALTH INSURING 129
CORPORATION SHALL, ON OR PRIOR TO THE FIRST DAY OF MARCH OF EVERY 130
YEAR, PREPARE AND SUBMIT TO THE SUPERINTENDENT OF INSURANCE A 131
REPORT ON ITS RBC LEVELS AS OF THE END OF THE CALENDAR YEAR JUST 132
ENDED, IN A FORM AND CONTAINING SUCH INFORMATION AS IS REQUIRED 133
BY THE RBC INSTRUCTIONS. IN ADDITION, A DOMESTIC HEALTH INSURING 135
CORPORATION SHALL FILE ITS RBC REPORT AS FOLLOWS:
(1) WITH THE NAIC, IN ACCORDANCE WITH THE RBC 138
INSTRUCTIONS;
(2) WITH THE INSURANCE REGULATORY AUTHORITY OF ANY OTHER 140
STATE IN WHICH THE HEALTH INSURING CORPORATION IS AUTHORIZED TO 141
DO BUSINESS, IF THE INSURANCE REGULATORY AUTHORITY OF THAT STATE 142
HAS SENT A WRITTEN REQUEST TO THE HEALTH INSURING CORPORATION FOR 143
THE RBC REPORT. THE HEALTH INSURING CORPORATION SHALL FILE AN 144
RBC REPORT WITH THE REQUESTING STATE NO LATER THAN THE LATER OF: 145
(a) FIFTEEN DAYS AFTER THE HEALTH INSURING CORPORATION'S 147
4
RECEIPT OF THE INSURANCE REGULATORY AUTHORITY'S REQUEST FOR THE 148
RBC REPORT; 149
(b) PRIOR TO THE FIRST DAY OF MARCH. 151
(B) A HEALTH INSURING CORPORATION'S RBC LEVELS SHALL BE 153
DETERMINED IN ACCORDANCE WITH THE FORMULA SET FORTH IN THE RBC 154
INSTRUCTIONS. THE FORMULA SHALL TAKE THE FOLLOWING RISKS INTO 155
ACCOUNT, AND MAY ADJUST FOR THE COVARIANCE BETWEEN THESE RISKS, 156
AS DETERMINED IN EACH CASE BY APPLYING THE FACTORS IN THE MANNER
SET FORTH IN THE RBC INSTRUCTIONS: 157
(1) ASSET RISK; 159
(2) CREDIT RISK; 161
(3) UNDERWRITING RISK; 163
(4) ALL OTHER BUSINESS RISKS AND SUCH OTHER RELEVANT RISKS 165
AS ARE SET FORTH IN THE RBC INSTRUCTIONS. 166
(C) IF A DOMESTIC HEALTH INSURING CORPORATION FILES AN RBC 169
REPORT THAT IN THE JUDGMENT OF THE SUPERINTENDENT IS INACCURATE, 170
THE SUPERINTENDENT SHALL ADJUST THE RBC REPORT TO CORRECT THE 171
INACCURACY AND THEN SHALL PROVIDE A COPY OF THE ADJUSTED RBC 172
REPORT TO THE HEALTH INSURING CORPORATION. THE SUPERINTENDENT 173
SHALL ALSO PROVIDE THE HEALTH INSURING CORPORATION WITH A 175
STATEMENT OF THE REASONS FOR ANY ADJUSTMENT.
(D) IN ENACTING SECTIONS 1753.31 TO 1753.43 OF THE REVISED 178
CODE, THE GENERAL ASSEMBLY FINDS ALL OF THE FOLLOWING: 179
(1) AN EXCESS OF CAPITAL OVER THE AMOUNT PRODUCED BY THE 181
RISK-BASED CAPITAL REQUIREMENTS OF SECTIONS 1753.31 TO 1753.43 OF 182
THE REVISED CODE, AND THE FORMULAS, SCHEDULES, AND INSTRUCTIONS 183
REFERENCED IN SECTIONS 1753.31 TO 1753.43 OF THE REVISED CODE, IS 184
DESIRABLE IN THE BUSINESS OF INSURANCE. 185
(2) HEALTH INSURING CORPORATIONS, ACCORDINGLY, SHOULD SEEK 187
TO MAINTAIN CAPITAL ABOVE THE RBC LEVELS REQUIRED BY SECTIONS 188
1753.31 TO 1753.43 OF THE REVISED CODE. 189
(3) ADDITIONAL CAPITAL IS USED AND IS USEFUL IN THE 191
BUSINESS OF INSURANCE, HELPING TO SECURE A HEALTH INSURING 192
CORPORATION AGAINST VARIOUS RISKS INHERENT IN, OR AFFECTING, THE 193
5
BUSINESS OF INSURANCE, WHICH RISKS ARE NOT ACCOUNTED FOR OR ARE 194
ONLY PARTIALLY MEASURED BY THE RISK-BASED CAPITAL REQUIREMENTS OF 195
SECTIONS 1753.31 TO 1753.43 OF THE REVISED CODE. 196
Sec. 1753.33. (A) FOR PURPOSES OF SECTIONS 1753.31 TO 198
1753.43 OF THE REVISED CODE, A "COMPANY ACTION LEVEL EVENT" IS 199
ANY OF THE FOLLOWING EVENTS: 200
(1) A HEALTH INSURING CORPORATION'S FILING OF AN RBC 202
REPORT THAT INDICATES THAT THE HEALTH INSURING CORPORATION'S 203
TOTAL ADJUSTED CAPITAL IS GREATER THAN OR EQUAL TO ITS REGULATORY 204
ACTION LEVEL RBC BUT LESS THAN ITS COMPANY ACTION LEVEL RBC; 205
(2) THE NOTIFICATION BY THE SUPERINTENDENT OF INSURANCE TO 207
A HEALTH INSURING CORPORATION OF AN ADJUSTMENT TO THE HEALTH 208
INSURING CORPORATION'S RBC REPORT, WHICH ADJUSTED RBC REPORT 209
SHOWS THE HEALTH INSURING CORPORATION'S TOTAL ADJUSTED CAPITAL 210
WITHIN THE RANGE DESCRIBED IN DIVISION (A)(1) OF THIS SECTION, 211
PROVIDED THAT THE HEALTH INSURING CORPORATION DOES NOT CHALLENGE 212
THE ADJUSTED RBC REPORT UNDER SECTION 1753.37 OF THE REVISED 214
CODE;
(3) THE NOTIFICATION BY THE SUPERINTENDENT TO A HEALTH 216
INSURING CORPORATION, FOLLOWING THE HEARING REQUIRED UNDER 217
SECTION 1753.37 OF THE REVISED CODE, THAT THE SUPERINTENDENT HAS 218
REJECTED THE HEALTH INSURING CORPORATION'S CHALLENGE TO AN 219
ADJUSTED RBC REPORT SHOWING THE HEALTH INSURING CORPORATION'S 220
TOTAL ADJUSTED CAPITAL WITHIN THE RANGE DESCRIBED IN DIVISION 221
(A)(1) OF THIS SECTION.
(B) IN THE CASE OF A COMPANY ACTION LEVEL EVENT, THE 223
HEALTH INSURING CORPORATION SHALL PREPARE AND SUBMIT TO THE 224
SUPERINTENDENT AN RBC PLAN THAT SHALL DO ALL OF THE FOLLOWING: 225
(1) IDENTIFY THE CONDITIONS THAT CONTRIBUTED TO THE 227
COMPANY ACTION LEVEL EVENT; 228
(2) CONTAIN PROPOSALS OF CORRECTIVE ACTIONS THAT THE 230
HEALTH INSURING CORPORATION INTENDS TO TAKE TO ELIMINATE THE 231
CONDITIONS CONTRIBUTING TO THE COMPANY ACTION LEVEL EVENT; 232
(3) PROVIDE PROJECTIONS OF THE HEALTH INSURING 234
6
CORPORATION'S FINANCIAL RESULTS IN THE CURRENT YEAR AND AT LEAST 235
THE TWO SUCCEEDING YEARS, BOTH IN THE ABSENCE OF THE PROPOSED 236
CORRECTIVE ACTIONS AND GIVING EFFECT TO THE PROPOSED CORRECTIVE 237
ACTIONS. THE PROJECTIONS SHALL INCLUDE PROJECTIONS OF STATUTORY 238
BALANCE SHEETS, OPERATING INCOME, NET INCOME, CAPITAL, SURPLUS,
AND RBC LEVELS. PROJECTIONS FOR BOTH NEW AND RENEWAL BUSINESS 240
MAY INCLUDE SEPARATE PROJECTIONS FOR EACH MAJOR LINE OF BUSINESS, 241
AND MAY SEPARATELY IDENTIFY EACH SIGNIFICANT INCOME, EXPENSE, AND 242
BENEFIT COMPONENT OF THE PROJECTION.
(4) IDENTIFY THE KEY ASSUMPTIONS IMPACTING THE HEALTH 244
INSURING CORPORATION'S PROJECTIONS MADE PURSUANT TO DIVISION 245
(B)(3) OF THIS SECTION, AND DESCRIBE THE SENSITIVITY OF THE 246
PROJECTIONS TO THE ASSUMPTIONS; 247
(5) IDENTIFY THE QUALITY OF, AND PROBLEMS ASSOCIATED WITH, 249
THE HEALTH INSURING CORPORATION'S BUSINESS, INCLUDING, BUT NOT 250
LIMITED TO, ITS ASSETS, ANTICIPATED BUSINESS GROWTH AND 251
ASSOCIATED SURPLUS STRAIN, EXTRAORDINARY EXPOSURE TO RISK, MIX OF 252
BUSINESS, AND THE USE OF REINSURANCE, IF ANY, IN EACH CASE. 253
(C) THE RBC PLAN SHALL BE SUBMITTED WITHIN FORTY-FIVE DAYS 255
AFTER A COMPANY ACTION LEVEL EVENT. HOWEVER, IF A HEALTH 256
INSURING CORPORATION HAS CHALLENGED AN ADJUSTED RBC REPORT 257
PURSUANT TO SECTION 1753.37 OF THE REVISED CODE, AN RBC PLAN NEED 258
NOT BE SUBMITTED UNLESS THE SUPERINTENDENT REJECTS THE CHALLENGE 259
FOLLOWING THE HEARING REQUIRED UNDER SECTION 1753.37 OF THE 260
REVISED CODE. IF THE SUPERINTENDENT REJECTS THE HEALTH INSURING 261
CORPORATION'S CHALLENGE, THE RBC PLAN SHALL BE SUBMITTED WITHIN 262
FORTY-FIVE DAYS AFTER THE SUPERINTENDENT'S NOTIFICATION TO THE 263
HEALTH INSURING CORPORATION OF THE SUPERINTENDENT'S REJECTION OF 264
THE CHALLENGE.
(D)(1) WITHIN SIXTY DAYS AFTER A HEALTH INSURING 266
CORPORATION SUBMITS AN RBC PLAN TO THE SUPERINTENDENT, THE 267
SUPERINTENDENT SHALL EITHER REQUIRE THE HEALTH INSURING 268
CORPORATION TO IMPLEMENT THE RBC PLAN OR NOTIFY THE HEALTH 269
INSURING CORPORATION THAT THE RBC PLAN IS UNSATISFACTORY IN THE 270
7
JUDGMENT OF THE SUPERINTENDENT. IF THE SUPERINTENDENT HAS 271
DETERMINED THAT THE RBC PLAN IS UNSATISFACTORY, THE NOTIFICATION 272
TO THE HEALTH INSURING CORPORATION SHALL SET FORTH THE REASONS 274
FOR THE DETERMINATION, AND MAY SET FORTH PROPOSED REVISIONS THAT
WILL RENDER THE RBC PLAN SATISFACTORY IN THE JUDGMENT OF THE 276
SUPERINTENDENT. UPON ITS RECEIPT OF SUCH NOTIFICATION FROM THE
SUPERINTENDENT, THE HEALTH INSURING CORPORATION SHALL PREPARE AND 278
SUBMIT A REVISED RBC PLAN, WHICH MAY INCORPORATE BY REFERENCE ANY 279
REVISIONS PROPOSED BY THE SUPERINTENDENT. 280
(2) IF A HEALTH INSURING CORPORATION CHALLENGES, UNDER 282
SECTION 1753.37 OF THE REVISED CODE, A NOTIFICATION BY THE 283
SUPERINTENDENT THAT THE HEALTH INSURING CORPORATION'S RBC PLAN OR 284
A REVISED RBC PLAN IS UNSATISFACTORY, SUBMISSION OF A REVISED RBC 285
PLAN NEED NOT BE MADE UNLESS THE SUPERINTENDENT REJECTS THE 286
HEALTH INSURING CORPORATION'S CHALLENGE AND NOTIFIES THE HEALTH 287
INSURING CORPORATION OF THIS REJECTION. A HEALTH INSURING 288
CORPORATION SHALL SUBMIT A REVISED RBC PLAN TO THE SUPERINTENDENT 289
WITHIN FORTY-FIVE DAYS AFTER RECEIVING NOTIFICATION FROM THE 290
SUPERINTENDENT THAT ITS RBC PLAN IS UNSATISFACTORY, OR THAT ITS 291
CHALLENGE TO A NOTIFICATION MADE UNDER DIVISION (D)(1) OF THIS 292
SECTION HAS BEEN REJECTED, AS APPLICABLE.
(E) NOTWITHSTANDING DIVISION (D) OF THIS SECTION, IF THE 294
SUPERINTENDENT NOTIFIES A HEALTH INSURING CORPORATION THAT ITS 295
RBC PLAN OR REVISED RBC PLAN IS UNSATISFACTORY, THE 296
SUPERINTENDENT MAY, AT THE SUPERINTENDENT'S DISCRETION BUT 297
SUBJECT TO THE HEALTH INSURING CORPORATION'S RIGHT TO A HEARING 298
UNDER SECTION 1753.37 OF THE REVISED CODE, SPECIFY IN THE
NOTIFICATION THAT THE NOTIFICATION CONSTITUTES A REGULATORY 299
ACTION LEVEL EVENT. 300
(F) EVERY DOMESTIC HEALTH INSURING CORPORATION THAT 302
SUBMITS AN RBC PLAN OR REVISED RBC PLAN TO THE SUPERINTENDENT 303
SHALL FILE A COPY OF THE RBC PLAN OR REVISED RBC PLAN WITH THE 304
INSURANCE REGULATORY AUTHORITY OF EVERY STATE IN WHICH THE HEALTH 305
INSURING CORPORATION IS AUTHORIZED TO DO BUSINESS UPON RECEIVING
8
THE INSURANCE REGULATORY AUTHORITY'S WRITTEN REQUEST FOR A COPY 306
OF THE PLAN, IF THE STATE HAS A CONFIDENTIALITY LAW SUBSTANTIALLY 307
SIMILAR TO SECTION 1753.38 OF THE REVISED CODE. THE HEALTH 308
INSURING CORPORATION SHALL FILE THE COPY IN THAT STATE NO LATER 309
THAN THE LATER OF: 310
(1) FIFTEEN DAYS AFTER RECEIVING THE REQUEST FOR A COPY OF 312
THE PLAN; 313
(2) THE DATE ON WHICH THE RBC PLAN OR REVISED RBC PLAN IS 315
FILED PURSUANT TO DIVISION (C) OR (D) OF THIS SECTION. 316
Sec. 1753.34. (A) FOR PURPOSES OF SECTIONS 1753.31 TO 318
1753.43 OF THE REVISED CODE, A "REGULATORY ACTION LEVEL EVENT" IS 319
ANY OF THE FOLLOWING EVENTS: 320
(1) THE FILING OF AN RBC REPORT BY A HEALTH INSURING 322
CORPORATION THAT INDICATES THAT THE HEALTH INSURING CORPORATION'S 323
TOTAL ADJUSTED CAPITAL IS GREATER THAN OR EQUAL TO ITS AUTHORIZED
CONTROL LEVEL RBC BUT LESS THAN ITS REGULATORY ACTION LEVEL RBC; 324
(2) THE NOTIFICATION BY THE SUPERINTENDENT OF INSURANCE TO 326
A HEALTH INSURING CORPORATION OF AN ADJUSTMENT TO THE HEALTH 327
INSURING CORPORATION'S RBC REPORT, WHICH ADJUSTED RBC REPORT 328
SHOWS THE HEALTH INSURING CORPORATION'S TOTAL ADJUSTED CAPITAL 329
WITHIN THE RANGE DESCRIBED IN DIVISION (A)(1) OF THIS SECTION, 330
PROVIDED THAT THE HEALTH INSURING CORPORATION DOES NOT CHALLENGE 331
THE ADJUSTED RBC REPORT UNDER SECTION 1753.37 OF THE REVISED 333
CODE;
(3) THE NOTIFICATION BY THE SUPERINTENDENT TO A HEALTH 335
INSURING CORPORATION, FOLLOWING THE HEARING REQUIRED UNDER 336
SECTION 1753.37 OF THE REVISED CODE, THAT THE SUPERINTENDENT HAS 337
REJECTED THE HEALTH INSURING CORPORATION'S CHALLENGE TO AN 338
ADJUSTED RBC REPORT SHOWING THE HEALTH INSURING CORPORATION'S 339
TOTAL ADJUSTED CAPITAL WITHIN THE RANGE DESCRIBED IN DIVISION 340
(A)(1) OF THIS SECTION;
(4) THE FAILURE OF A HEALTH INSURING CORPORATION TO FILE 342
AN RBC REPORT BY THE FIRST DAY OF MARCH OF EVERY YEAR, UNLESS THE 343
HEALTH INSURING CORPORATION HAS PROVIDED AN EXPLANATION FOR SUCH 344
9
FAILURE THAT IS SATISFACTORY TO THE SUPERINTENDENT AND HAS CURED 345
THE FAILURE WITHIN TEN DAYS AFTER THE FILING DATE; 346
(5) THE FAILURE OF A HEALTH INSURING CORPORATION TO SUBMIT 348
AN RBC PLAN TO THE SUPERINTENDENT WITHIN THE TIME PERIOD SET 349
FORTH IN DIVISION (C) OF SECTION 1753.33 OF THE REVISED CODE; 350
(6) THE NOTIFICATION BY THE SUPERINTENDENT TO A HEALTH 352
INSURING CORPORATION OF BOTH OF THE FOLLOWING: 353
(a) THE RBC PLAN OR REVISED RBC PLAN SUBMITTED BY THE 355
HEALTH INSURING CORPORATION IS UNSATISFACTORY IN THE JUDGMENT OF 356
THE SUPERINTENDENT; 357
(b) THE NOTIFICATION BY THE SUPERINTENDENT CONSTITUTES A 359
REGULATORY ACTION LEVEL EVENT WITH RESPECT TO THE HEALTH INSURING 360
CORPORATION, PROVIDED THAT THE HEALTH INSURING CORPORATION DOES 362
NOT CHALLENGE THE DETERMINATION UNDER SECTION 1753.37 OF THE 363
REVISED CODE.
(7) THE NOTIFICATION BY THE SUPERINTENDENT TO A HEALTH 365
INSURING CORPORATION, FOLLOWING THE HEARING REQUIRED UNDER 366
SECTION 1753.37 OF THE REVISED CODE, THAT THE SUPERINTENDENT HAS 367
REJECTED THE HEALTH INSURING CORPORATION'S CHALLENGE TO THE 369
SUPERINTENDENT'S DETERMINATION UNDER DIVISION (A)(6) OF THIS 370
SECTION;
(8) THE NOTIFICATION BY THE SUPERINTENDENT TO A HEALTH 372
INSURING CORPORATION THAT THE SUPERINTENDENT HAS DETERMINED THAT 373
THE HEALTH INSURING CORPORATION HAS FAILED TO ADHERE TO ITS RBC 374
PLAN OR REVISED RBC PLAN, AND THIS FAILURE HAS HAD A SUBSTANTIAL 375
ADVERSE EFFECT ON THE ABILITY OF THE HEALTH INSURING CORPORATION 376
TO ELIMINATE THE CONDITIONS LEADING TO THE COMPANY ACTION LEVEL 377
EVENT IN ACCORDANCE WITH ITS RBC PLAN OR REVISED RBC PLAN, 378
PROVIDED THAT THE HEALTH INSURING CORPORATION DOES NOT CHALLENGE 379
THIS DETERMINATION UNDER SECTION 1753.37 OF THE REVISED CODE; 380
(9) THE NOTIFICATION BY THE SUPERINTENDENT TO A HEALTH 382
INSURING CORPORATION, FOLLOWING THE HEARING REQUIRED UNDER 383
SECTION 1753.37 OF THE REVISED CODE, THAT THE SUPERINTENDENT HAS 384
REJECTED THE HEALTH INSURING CORPORATION'S CHALLENGE TO THE 385
10
SUPERINTENDENT'S DETERMINATION UNDER DIVISION (A)(8) OF THIS 386
SECTION.
(B) IN THE CASE OF A REGULATORY ACTION LEVEL EVENT, THE 388
SUPERINTENDENT SHALL DO ALL OF THE FOLLOWING: 389
(1) REQUIRE THE HEALTH INSURING CORPORATION TO PREPARE AND 391
SUBMIT AN RBC PLAN OR, IF APPLICABLE, A REVISED RBC PLAN; 392
(2) PERFORM SUCH EXAMINATIONS AND ANALYSES AS THE 394
SUPERINTENDENT CONSIDERS NECESSARY OF THE ASSETS, LIABILITIES, 395
AND OPERATIONS OF THE HEALTH INSURING CORPORATION, INCLUDING A 396
REVIEW OF THE HEALTH INSURING CORPORATION'S RBC PLAN OR REVISED 397
RBC PLAN AND THE RESULTS OF ANY SENSITIVITY TESTS UNDERTAKEN 399
PURSUANT TO THE RBC INSTRUCTIONS;
(3) ISSUE A CORRECTIVE ORDER, BASED UPON THE EXAMINATIONS 401
AND ANALYSES PERFORMED UNDER DIVISION (B)(2) OF THIS SECTION. 402
(C)(1) THE RBC PLAN OR REVISED RBC PLAN REQUIRED BY 405
DIVISION (B)(1) OF THIS SECTION SHALL BE SUBMITTED TO THE 407
SUPERINTENDENT WITHIN FORTY-FIVE DAYS AFTER THE REGULATORY ACTION 408
LEVEL EVENT, EXCEPT BY A HEALTH INSURING CORPORATION THAT FILES A 409
CHALLENGE TO AN ADJUSTED RBC REPORT OR REVISED RBC PLAN PURSUANT 410
TO SECTION 1753.37 OF THE REVISED CODE. IF THE SUPERINTENDENT 411
DETERMINES THE CHALLENGE IS FRIVOLOUS, THE TIME LIMIT FOR THE 412
SUBMISSION OF THE RBC PLAN OR REVISED RBC PLAN SHALL NOT BE 413
ALTERED BY THE FILING OF THE CHALLENGE.
(2) IF A HEALTH INSURING CORPORATION FILES A NONFRIVOLOUS 415
CHALLENGE TO AN ADJUSTED RBC REPORT OR REVISED RBC PLAN, THE RBC 416
PLAN OR REVISED RBC PLAN REQUIRED BY DIVISION (B)(1) OF THIS 417
SECTION SHALL ONLY BE SUBMITTED TO THE SUPERINTENDENT IF THE 418
SUPERINTENDENT REJECTS THE CHALLENGE FOLLOWING THE HEARING
REQUIRED UNDER SECTION 1753.37 OF THE REVISED CODE. IF THE 419
SUPERINTENDENT REJECTS THE HEALTH INSURING CORPORATION'S 420
CHALLENGE, THE RBC PLAN OR REVISED RBC PLAN SHALL BE SUBMITTED 421
WITHIN FORTY-FIVE DAYS AFTER THE SUPERINTENDENT'S NOTIFICATION TO 422
THE HEALTH INSURING CORPORATION OF THE SUPERINTENDENT'S REJECTION 423
OF THE CHALLENGE.
11
(D) THE SUPERINTENDENT MAY RETAIN ACTUARIES, INVESTMENT 425
EXPERTS, AND SUCH OTHER CONSULTANTS, AS MAY BE NECESSARY IN THE 426
SUPERINTENDENT'S JUDGMENT, TO REVIEW A HEALTH INSURING 427
CORPORATION'S RBC PLAN OR REVISED RBC PLAN, TO EXAMINE OR ANALYZE 428
THE ASSETS, LIABILITIES, AND OPERATION OF THE HEALTH INSURING 429
CORPORATION, AND TO FORMULATE A CORRECTIVE ORDER FOR THE HEALTH
INSURING CORPORATION. THE FEES, COSTS, AND EXPENSES RELATING TO 430
THESE CONSULTANTS SHALL BE BORNE BY THE AFFECTED HEALTH INSURING 431
CORPORATION. 432
Sec. 1753.35. (A) FOR PURPOSES OF SECTIONS 1753.31 TO 434
1753.43 OF THE REVISED CODE, AN "AUTHORIZED CONTROL LEVEL EVENT" 435
IS ANY OF THE FOLLOWING EVENTS: 436
(1) THE FILING OF AN RBC REPORT BY A HEALTH INSURING 438
CORPORATION THAT INDICATES THAT THE HEALTH INSURING CORPORATION'S 439
TOTAL ADJUSTED CAPITAL IS GREATER THAN OR EQUAL TO ITS MANDATORY
CONTROL LEVEL RBC BUT LESS THAN ITS AUTHORIZED CONTROL LEVEL RBC; 440
(2) THE NOTIFICATION BY THE SUPERINTENDENT OF INSURANCE TO 442
A HEALTH INSURING CORPORATION OF AN ADJUSTMENT TO THE HEALTH 443
INSURING CORPORATION'S RBC REPORT, WHICH ADJUSTED RBC REPORT 444
SHOWS THE HEALTH INSURING CORPORATION'S TOTAL ADJUSTED CAPITAL 445
WITHIN THE RANGE DESCRIBED IN DIVISION (A)(1) OF THIS SECTION, 446
PROVIDED THAT THE HEALTH INSURING CORPORATION DOES NOT CHALLENGE 447
THE ADJUSTED RBC REPORT UNDER SECTION 1753.37 OF THE REVISED 449
CODE;
(3) THE NOTIFICATION BY THE SUPERINTENDENT TO A HEALTH 451
INSURING CORPORATION, FOLLOWING THE HEARING REQUIRED UNDER 452
SECTION 1753.37 OF THE REVISED CODE, THAT THE SUPERINTENDENT HAS 453
REJECTED THE HEALTH INSURING CORPORATION'S CHALLENGE TO AN 454
ADJUSTED RBC REPORT SHOWING THE HEALTH INSURING CORPORATION'S 455
TOTAL ADJUSTED CAPITAL WITHIN THE RANGE DESCRIBED IN DIVISION 456
(A)(1) OF THIS SECTION;
(4) THE FAILURE OF A HEALTH INSURING CORPORATION TO 458
RESPOND, IN A MANNER SATISFACTORY TO THE SUPERINTENDENT, TO A 459
CORRECTIVE ORDER ISSUED UNDER DIVISION (B)(3) OF SECTION 1753.34 460
12
OF THE REVISED CODE, PROVIDED THAT THE HEALTH INSURING 462
CORPORATION DOES NOT CHALLENGE THE CORRECTIVE ORDER UNDER SECTION 464
1753.37 OF THE REVISED CODE; 465
(5) THE FAILURE OF A HEALTH INSURING CORPORATION TO 467
RESPOND, IN A MANNER SATISFACTORY TO THE SUPERINTENDENT, TO A 468
CORRECTIVE ORDER ISSUED UNDER DIVISION (B)(3) OF SECTION 1753.34 469
OF THE REVISED CODE SUBSEQUENT TO THE SUPERINTENDENT'S 471
MODIFICATION OF AN EARLIER ORDER OR THE SUPERINTENDENT'S 472
REJECTION OF THE HEALTH INSURING CORPORATION'S CHALLENGE OF THE 473
ORDER UNDER SECTION 1753.37 OF THE REVISED CODE. 474
(B) IN THE CASE OF AN AUTHORIZED CONTROL LEVEL EVENT, THE 476
SUPERINTENDENT SHALL DO THE FOLLOWING: 477
(1) TAKE THE ACTIONS REQUIRED UNDER SECTION 1753.34 OF THE 479
REVISED CODE FOR REGULATORY ACTION LEVEL EVENTS; 482
(2) IF THE SUPERINTENDENT CONSIDERS IT TO BE IN THE BEST 484
INTERESTS OF THE SUBSCRIBERS AND CREDITORS OF THE HEALTH INSURING 485
CORPORATION AND OF THE PUBLIC, TAKE SUCH ACTIONS AS ARE NECESSARY 486
TO PLACE THE HEALTH INSURING CORPORATION UNDER REGULATORY CONTROL 487
UNDER SECTIONS 3903.01 TO 3903.59 OF THE REVISED CODE. THE 488
AUTHORIZED CONTROL LEVEL EVENT SHALL BE DEEMED SUFFICIENT GROUNDS 489
FOR THE SUPERINTENDENT TO TAKE ACTION UNDER SECTIONS 3903.01 TO 490
3903.59 OF THE REVISED CODE. NOTHING IN SECTIONS 1753.31 TO 491
1753.43 OF THE REVISED CODE SHALL IMPAIR OR RESTRICT THE RIGHTS, 492
POWERS, AND PROTECTIONS AFFORDED TO THE SUPERINTENDENT AND TO 493
HEALTH INSURING CORPORATIONS UNDER SECTIONS 3903.01 TO 3903.59 OF 494
THE REVISED CODE. 495
Sec. 1753.36. (A) FOR PURPOSES OF SECTIONS 1753.31 TO 497
1753.43 OF THE REVISED CODE, A "MANDATORY CONTROL LEVEL EVENT" IS 498
ANY OF THE FOLLOWING EVENTS: 499
(1) THE FILING OF AN RBC REPORT BY A HEALTH INSURING 501
CORPORATION THAT INDICATES THAT THE HEALTH INSURING CORPORATION'S 502
TOTAL ADJUSTED CAPITAL IS LESS THAN ITS MANDATORY CONTROL LEVEL 503
RBC;
(2) THE NOTIFICATION BY THE SUPERINTENDENT OF INSURANCE TO 505
13
A HEALTH INSURING CORPORATION OF AN ADJUSTMENT TO THE HEALTH 506
INSURING CORPORATION'S RBC REPORT, WHICH ADJUSTED RBC REPORT 507
SHOWS THE HEALTH INSURING CORPORATION'S TOTAL ADJUSTED CAPITAL AT 508
LESS THAN ITS MANDATORY CONTROL LEVEL RBC, PROVIDED THE HEALTH 509
INSURING CORPORATION DOES NOT CHALLENGE THE ADJUSTED RBC REPORT 510
UNDER SECTION 1753.37 OF THE REVISED CODE; 511
(3) THE NOTIFICATION BY THE SUPERINTENDENT TO THE HEALTH 513
INSURING CORPORATION, FOLLOWING THE HEARING REQUIRED UNDER 514
SECTION 1753.37 OF THE REVISED CODE, THAT THE SUPERINTENDENT HAS 515
REJECTED THE HEALTH INSURING CORPORATION'S CHALLENGE TO AN 516
ADJUSTED RBC REPORT.
(B) IN THE CASE OF A MANDATORY CONTROL LEVEL EVENT, THE 518
SUPERINTENDENT SHALL TAKE SUCH ACTIONS AS ARE NECESSARY TO PLACE 519
THE HEALTH INSURING CORPORATION UNDER REGULATORY CONTROL UNDER 520
SECTIONS 3903.01 TO 3903.59 OF THE REVISED CODE. THE MANDATORY 521
CONTROL LEVEL EVENT SHALL BE DEEMED SUFFICIENT GROUNDS FOR THE 522
SUPERINTENDENT TO TAKE ACTION UNDER SECTIONS 3903.01 TO 3903.59 523
OF THE REVISED CODE. NOTHING IN SECTIONS 1753.31 TO 1753.43 OF 524
THE REVISED CODE SHALL IMPAIR OR RESTRICT THE RIGHTS, POWERS, AND 525
PROTECTIONS AFFORDED TO THE SUPERINTENDENT AND TO HEALTH INSURING
CORPORATIONS UNDER SECTIONS 3903.01 TO 3903.59 OF THE REVISED 526
CODE. HOWEVER, THE SUPERINTENDENT MAY DEFER ACTION UNDER THIS 527
DIVISION FOR UP TO NINETY DAYS AFTER THE MANDATORY CONTROL LEVEL 528
EVENT IF THE SUPERINTENDENT FINDS THAT THERE IS A REASONABLE 529
EXPECTATION THE HEALTH INSURING CORPORATION MAY BE ABLE TO 530
ELIMINATE THE CONDITIONS LEADING TO THE MANDATORY CONTROL LEVEL 531
EVENT WITHIN THE NINETY-DAY PERIOD.
Sec. 1753.37. (A) A HEALTH INSURING CORPORATION HAS THE 533
RIGHT TO A CONFIDENTIAL HEARING UPON RECEIVING ANY OF THE 534
FOLLOWING FROM THE SUPERINTENDENT OF INSURANCE: 535
(1) AN ADJUSTED RBC REPORT; 537
(2) NOTIFICATION THAT THE HEALTH INSURING CORPORATION'S 539
RBC PLAN OR REVISED RBC PLAN IS UNSATISFACTORY AND A STATEMENT 540
THAT THE NOTIFICATION CONSTITUTES A REGULATORY ACTION LEVEL EVENT 541
14
FOR THE HEALTH INSURING CORPORATION; 542
(3) NOTIFICATION THAT THE SUPERINTENDENT HAS DETERMINED 544
THAT THE HEALTH INSURING CORPORATION HAS FAILED TO ADHERE TO ITS 545
RBC PLAN OR REVISED RBC PLAN, WHICH FAILURE HAS A SUBSTANTIAL 546
ADVERSE EFFECT ON THE ABILITY OF THE HEALTH INSURING CORPORATION 547
TO ELIMINATE THE CONDITIONS LEADING TO A COMPANY ACTION LEVEL 549
EVENT IN ACCORDANCE WITH ITS RBC PLAN OR REVISED RBC PLAN; 550
(4) A CORRECTIVE ORDER ISSUED UNDER DIVISION (B)(3) OF 552
SECTION 1753.34 OF THE REVISED CODE. 553
(B) A HEALTH INSURING CORPORATION SHALL NOTIFY THE 555
SUPERINTENDENT OF ITS REQUEST FOR A HEARING WITHIN FIVE DAYS 556
AFTER ITS RECEIPT OF ANY ITEM LISTED IN DIVISION (A) OF THIS 557
SECTION. UPON THE SUPERINTENDENT'S RECEIPT OF THE HEALTH 558
INSURING CORPORATION'S REQUEST FOR A HEARING, THE SUPERINTENDENT 559
SHALL SET A DATE FOR THE HEARING, WHICH DATE SHALL BE NO LESS 560
THAN TEN DAYS AND NO MORE THAN THIRTY DAYS AFTER THE
SUPERINTENDENT'S RECEIPT OF THE HEALTH INSURING CORPORATION'S 561
REQUEST. 562
(C) A HEALTH INSURING CORPORATION MAY CHALLENGE ANY 564
DETERMINATION OR ACTION TAKEN BY THE SUPERINTENDENT UNDER 565
SECTIONS 1753.31 TO 1753.43 OF THE REVISED CODE AT THE HEARING 566
HELD PURSUANT TO THIS SECTION. 567
Sec. 1753.38. (A) THE SUPERINTENDENT OF INSURANCE SHALL 569
KEEP ALL OF THE FOLLOWING CONFIDENTIAL: 570
(1) AN RBC REPORT, TO THE EXTENT THAT INFORMATION 572
CONTAINED IN THE REPORT IS NOT REQUIRED TO BE INCLUDED IN AN 573
ANNUAL STATEMENT AVAILABLE TO THE PUBLIC; 574
(2) AN RBC PLAN; 576
(3) THE RESULTS OF, OR REPORTS ON, EXAMINATIONS OR 578
ANALYSES CONDUCTED PURSUANT TO DIVISION (B)(2) OF SECTION 1753.34 579
OF THE REVISED CODE, AND A CORRECTIVE ORDER ISSUED PURSUANT TO 581
DIVISION (B)(3) OF SECTION 1753.34 OF THE REVISED CODE. 582
A DISCLOSURE TO THE SUPERINTENDENT OF THESE PLANS, REPORTS, 584
INFORMATION, AND ORDERS DOES NOT CONSTITUTE A WAIVER OF ANY 585
15
APPLICABLE PRIVILEGE OR CLAIM OF CONFIDENTIALITY IN THE PLANS, 586
REPORTS, INFORMATION, AND ORDERS. 587
(B) NOTWITHSTANDING DIVISION (A) OF THIS SECTION: 589
(1) THE PLANS, REPORTS, INFORMATION, AND ORDERS DESCRIBED 591
IN DIVISION (A) OF THIS SECTION MAY BE USED BY THE SUPERINTENDENT 592
IN ACCORDANCE WITH THE INSURANCE LAWS OF THIS STATE. 593
(2) IN THE PERFORMANCE OF THE SUPERINTENDENT'S DUTIES, THE 595
SUPERINTENDENT MAY SHARE THE PLANS, REPORTS, INFORMATION, AND 596
ORDERS WITH STATE, FEDERAL, AND INTERNATIONAL REGULATORY AGENCIES 597
AND LAW ENFORCEMENT AUTHORITIES, AND WITH THE NAIC AND ITS 598
AFFILIATES AND SUBSIDIARIES, PROVIDED THAT THE RECIPIENT AGREES 599
TO MAINTAIN THE CONFIDENTIALITY OF THE PLANS, REPORTS, 600
INFORMATION, AND ORDERS. 601
(C)(1) THE PLANS, REPORTS, INFORMATION, AND ORDERS 603
DESCRIBED IN DIVISION (A) OF THIS SECTION ARE NOT PUBLIC RECORDS 604
FOR PURPOSES OF SECTION 149.43 OF THE REVISED CODE AND SHALL NOT 605
BE SUBJECT TO SUBPOENA. THE PLANS, REPORTS, INFORMATION, AND 607
ORDERS SHALL NOT BE SUBJECT TO DISCOVERY OR ADMISSIBLE IN 608
EVIDENCE IN ANY PRIVATE CIVIL ACTION. 609
(2) NEITHER THE SUPERINTENDENT NOR ANY PERSON WHO RECEIVES 611
THE PLANS, REPORTS, INFORMATION, AND ORDERS WHILE ACTING UNDER 612
THE AUTHORITY OF THE SUPERINTENDENT SHALL BE PERMITTED OR 613
REQUIRED TO TESTIFY IN ANY PRIVATE CIVIL ACTION CONCERNING THESE 614
PLANS, REPORTS, INFORMATION, AND ORDERS. 615
(D) A COMPARISON OF A HEALTH INSURING CORPORATION'S TOTAL 617
ADJUSTED CAPITAL TO ANY OF ITS RBC LEVELS SHALL NOT BE USED TO 618
RANK HEALTH INSURING CORPORATIONS. 619
(E) RBC INSTRUCTIONS, RBC REPORTS, ADJUSTED RBC REPORTS, 622
RBC PLANS, AND REVISED RBC PLANS SHALL NOT BE USED BY THE 623
SUPERINTENDENT FOR RATEMAKING, CONSIDERED OR INTRODUCED AS 624
EVIDENCE IN ANY RATE PROCEEDING, OR USED BY THE SUPERINTENDENT TO 625
CALCULATE OR DERIVE ANY ELEMENTS OF AN APPROPRIATE PREMIUM LEVEL 626
OR RATE OF RETURN FOR ANY LINE OF INSURANCE THAT A HEALTH 627
INSURING CORPORATION OR ANY AFFILIATE IS AUTHORIZED TO WRITE. 628
16
(F) EXCEPT AS OTHERWISE REQUIRED UNDER CHAPTER 1751. OR 630
1753. OF THE REVISED CODE, IT IS AN UNFAIR AND DECEPTIVE ACT OR 632
PRACTICE IN THE BUSINESS OF INSURANCE UNDER SECTIONS 3901.19 TO 634
3901.26 OF THE REVISED CODE FOR ANY PERSON TO MAKE, PUBLISH, 635
DISSEMINATE, CIRCULATE, OR PLACE BEFORE THE PUBLIC, OR TO CAUSE, 637
DIRECTLY OR INDIRECTLY, TO BE MADE, PUBLISHED, DISSEMINATED,
CIRCULATED, OR PLACED BEFORE THE PUBLIC, IN A NEWSPAPER, 638
MAGAZINE, OR OTHER PUBLICATION, IN THE FORM OF A NOTICE, 639
CIRCULAR, PAMPHLET, LETTER, OR POSTER, OR OVER ANY RADIO OR 640
TELEVISION STATION, OR IN ANY OTHER MANNER, AN ADVERTISEMENT, 641
ANNOUNCEMENT, OR STATEMENT, WRITTEN OR ORAL, THAT CONTAINS AN 642
ASSERTION, REPRESENTATION, OR STATEMENT, REGARDING THE RBC LEVELS 643
OF A HEALTH INSURING CORPORATION, OR ANY COMPONENT DERIVED IN THE 644
CALCULATION OF THE RBC LEVELS.
(G) IF ANY MATERIALLY FALSE STATEMENT IS PUBLISHED 646
COMPARING A HEALTH INSURING CORPORATION'S TOTAL ADJUSTED CAPITAL 647
TO ITS RBC LEVELS, OR ANY INAPPROPRIATE COMPARISON OF ANY OTHER 648
AMOUNT TO ANY OF THE HEALTH INSURING CORPORATION'S RBC LEVELS IS 649
PUBLISHED, AND THE HEALTH INSURING CORPORATION IS ABLE TO 650
DEMONSTRATE TO THE SUPERINTENDENT WITH SUBSTANTIAL PROOF THE 651
FALSITY OF THE STATEMENT OR THE INAPPROPRIATENESS OF THE
COMPARISON, THEN THE HEALTH INSURING CORPORATION MAY PUBLISH WITH 652
THE SUPERINTENDENT'S APPROVAL AN ANNOUNCEMENT IN A WRITTEN 653
PUBLICATION TO REBUT THE MATERIALLY FALSE STATEMENT OR 654
INAPPROPRIATE COMPARISON. 655
Sec. 1753.39. (A) EACH FOREIGN HEALTH INSURING 657
CORPORATION SHALL SUBMIT TO THE SUPERINTENDENT OF INSURANCE, UPON 658
RECEIVING THE SUPERINTENDENT'S WRITTEN REQUEST, AN RBC REPORT FOR 659
THE CALENDAR YEAR JUST ENDED. THE HEALTH INSURING CORPORATION 660
SHALL SUBMIT THE RBC REPORT TO THE SUPERINTENDENT NO LATER THAN 661
THE LATER OF:
(1) THE DATE A DOMESTIC HEALTH INSURING CORPORATION WOULD 663
BE REQUIRED TO FILE AN RBC REPORT UNDER SECTION 1753.32 OF THE 665
REVISED CODE;
17
(2) FIFTEEN DAYS AFTER THE SUPERINTENDENT'S REQUEST IS 667
RECEIVED BY THE FOREIGN HEALTH INSURING CORPORATION. 668
(B) EACH FOREIGN HEALTH INSURING CORPORATION SHALL, UPON 670
RECEIVING THE SUPERINTENDENT'S WRITTEN REQUEST, PROMPTLY SUBMIT 671
TO THE SUPERINTENDENT A COPY OF ANY RBC PLAN OR REVISED RBC PLAN 672
FILED WITH THE INSURANCE REGULATORY AUTHORITY OF ANY OTHER STATE. 673
(C) THE SUPERINTENDENT MAY REQUIRE A FOREIGN HEALTH 675
INSURING CORPORATION TO FILE AN RBC PLAN WITH THE SUPERINTENDENT 676
IN THE CASE OF A COMPANY ACTION LEVEL EVENT, REGULATORY ACTION 677
LEVEL EVENT, OR AUTHORIZED CONTROL LEVEL EVENT INVOLVING THE 678
FOREIGN HEALTH INSURING CORPORATION, IF THE INSURANCE REGULATORY 679
AUTHORITY OF THE STATE OF DOMICILE OF THE FOREIGN HEALTH INSURING 680
CORPORATION FAILS TO REQUIRE THE FOREIGN HEALTH INSURING 681
CORPORATION TO FILE AN RBC PLAN IN THE MANNER SPECIFIED UNDER 682
THAT STATE'S RBC LAWS, IF ANY. THE FAILURE OF A FOREIGN HEALTH 683
INSURING CORPORATION TO FILE AN RBC PLAN OR REVISED RBC PLAN WITH 684
THE SUPERINTENDENT AS REQUIRED SHALL BE GROUNDS FOR THE 685
SUPERINTENDENT TO ORDER THE HEALTH INSURING CORPORATION TO CEASE
AND DESIST FROM WRITING NEW BUSINESS IN THIS STATE. 686
(D) IN THE CASE OF A MANDATORY CONTROL LEVEL EVENT 688
INVOLVING A FOREIGN HEALTH INSURING CORPORATION, IF NO 689
DOMICILIARY RECEIVER HAS BEEN APPOINTED FOR THE FOREIGN HEALTH 690
INSURING CORPORATION UNDER THE REHABILITATION AND LIQUIDATION 691
LAWS APPLICABLE IN THE STATE OF DOMICILE OF THE FOREIGN HEALTH 692
INSURING CORPORATION, THE SUPERINTENDENT MAY MAKE APPLICATION TO 693
THE COURT OF COMMON PLEAS AS PERMITTED IN SECTIONS 3903.50 TO 694
3903.59 OF THE REVISED CODE FOR AN ORDER DIRECTING THE 695
SUPERINTENDENT TO LIQUIDATE THE PROPERTY OF THE FOREIGN HEALTH
INSURING CORPORATION FOUND IN THIS STATE. THE OCCURRENCE OF THE 696
MANDATORY CONTROL LEVEL EVENT SHALL BE DEEMED SUFFICIENT GROUNDS 697
FOR THE SUPERINTENDENT TO MAKE APPLICATION TO THE COURT. 698
Sec. 1753.40. THERE SHALL BE NO LIABILITY ON THE PART OF, 700
AND NO CAUSE OF ACTION SHALL ARISE AGAINST, THE SUPERINTENDENT OF 701
INSURANCE, OR THE DEPARTMENT OF INSURANCE, ITS EMPLOYEES, OR ITS 702
18
AGENTS, FOR ANY ACTION TAKEN IN THEIR PERFORMANCE OF THE POWERS 703
AND DUTIES UNDER SECTIONS 1753.31 TO 1753.43 OF THE REVISED CODE. 704
Sec. 1753.41. UNLESS OTHERWISE PROVIDED, ALL NOTICES SENT 706
TO A HEALTH INSURING CORPORATION BY THE SUPERINTENDENT OF 707
INSURANCE THAT MAY RESULT IN REGULATORY ACTION UNDER SECTIONS 708
1753.31 TO 1753.43 OF THE REVISED CODE SHALL BE EFFECTIVE UPON 709
DISPATCH IF TRANSMITTED BY REGISTERED OR CERTIFIED MAIL. ANY 710
OTHER NOTICE TRANSMITTED SHALL BE EFFECTIVE UPON THE HEALTH
INSURING CORPORATION'S RECEIPT OF THE NOTICE. 711
Sec. 1753.42. THE SUPERINTENDENT OF INSURANCE MAY EXEMPT 713
ANY DOMESTIC HEALTH INSURING CORPORATION FROM THE APPLICATION OF 714
SECTIONS 1753.31 TO 1753.43 OF THE REVISED CODE, IF THE HEALTH 715
INSURING CORPORATION MEETS ALL OF THE FOLLOWING REQUIREMENTS: 716
(A) THE HEALTH INSURING CORPORATION WRITES DIRECT BUSINESS 718
IN THIS STATE ONLY. 719
(B) THE HEALTH INSURING CORPORATION ASSUMES NO REINSURANCE 721
IN EXCESS OF FIVE PER CENT OF DIRECT PREMIUM WRITTEN. 722
(C) THE HEALTH INSURING CORPORATION EITHER: 724
(1) WRITES DIRECT ANNUAL PREMIUMS OF TWO MILLION DOLLARS 726
OR LESS FOR BASIC HEALTH CARE SERVICES; 727
(2) COVERS LESS THAN TWO THOUSAND ENROLLEES UNDER 729
POLICIES, CONTRACTS, CERTIFICATES, OR AGREEMENTS FOR SUPPLEMENTAL 730
HEALTH CARE SERVICES. 731
Sec. 1753.43. THE SUPERINTENDENT OF INSURANCE MAY ADOPT 733
RULES IN ACCORDANCE WITH CHAPTER 119. OF THE REVISED CODE AS ARE 734
REASONABLY NECESSARY FOR THE IMPLEMENTATION AND OPERATION OF 735
SECTIONS 1753.31 TO 1753.43 OF THE REVISED CODE. 736
Section 2. That existing section 1753.01 of the Revised 738
Code is hereby repealed. 739
Section 3. The authorized control level RBC, as defined by 741
division (B) of section 1753.31 of the Revised Code, as enacted 742
by this act, shall be adjusted for use in reports filed for 743
periods through December 31, 2002. Notwithstanding division (B) 744
of section 1753.31 of the Revised Code, the authorized control 745
19
level RBC for use in reports filed for the period ending December 746
31, 2001, shall be the product of 0.80 and the number determined 747
under the risk-based capital formula in accordance with the RBC 748
instructions; the authorized control level RBC for use in reports 749
filed for the period ending December 31, 2002, shall be the 750
product of 0.90 and the number determined under the risk-based 751
capital formula in accordance with the RBC instructions. 752
Thereafter, the authorized control level RBC shall be determined 753
in accordance with division (B) of section 1753.31 of the Revised 754
Code without this adjustment.