Chapter 1753: PHYSICIAN-HEALTH PLAN PARTNERSHIP ACT; RISK-BASED CAPITAL FOR INSURERS MODEL ACT

1753.01 Physician-health plan partnership act definitions.

As used in this chapter "basic health care services," "enrollee," "health care facility," "health care services," "health insuring corporation," "medical record," "person," "primary care provider," "provider," "specialty health care services," "subscriber," and "supplemental health care services" have the same meanings as in section 1751.01 of the Revised Code.

Effective Date: 03-15-2001; 2008 HB125 06-25-2008

1753.03 [Repealed].

Effective Date: 10-01-1998; 2008 HB125 06-25-2008

1753.04 [Repealed].

Effective Date: 10-01-1998; 2008 HB125 06-25-2008

1753.05 [Repealed].

Effective Date: 10-01-1998; 2008 HB125 06-25-2008

1753.06 Notice of status of the provider's application.

A health insuring corporation shall notify a provider seeking to enter into a participation contract with the health insuring corporation of the status of the provider's application within one hundred twenty days after the health insuring corporation's receipt of the provider's completed application. That time period may be extended by a health insuring corporation if, due to extenuating circumstances, the health insuring corporation needs additional time to consider the application and notifies the provider of the reason for the delay.

Effective Date: 10-01-1998

1753.07 Information given to provider.

(A)

(1) Prior to entering into a participation contract with a provider under section 1751.13 of the Revised Code, a health insuring corporation shall disclose basic information regarding its programs and procedures to the provider. The information shall include all of the following:

(a) How a participating provider is reimbursed for the participating provider's services, including the range and structure of any financial risk sharing arrangements, a description of any incentive plans, and, if reimbursed according to a type of fee-for-service arrangement, the level of reimbursement for the participating provider's services;

(b) Insofar as division (A)(1) of section 3963.03 of the Revised Code is applicable, all of the information that is described in that division and is not included in division (A)(1)(a) of this section.

(2) Prior to entering into a participation contract with a provider under section 1751.13 of the Revised Code, a health insuring corporation shall disclose the following information upon the provider's request:

(a) How referrals to other participating providers or to nonparticipating providers are made;

(b) The availability of dispute resolution procedures and the potential for cost to be incurred;

(c) How a participating provider's name and address will be used in marketing materials.

(B) A health insuring corporation shall provide all of the following to a participating provider:

(1) Any material incorporated by reference into the participation contract, that is not otherwise available as a public record, if such material affects the participating provider;

(2) Administrative manuals related to provider participation, if any;

(3) Insofar as division (B) of section 3963.03 of the Revised Code is applicable, the summary disclosure form with the disclosures required under that division;

(4) A signed and dated copy of the final participation contract.

(C) Nothing in this section requires a health insuring corporation providing specialty health care services or supplemental health care services to disclose the health insuring corporation's aggregate maximum allowable fee table used to determine providers' fees or fee schedules.

Effective Date: 10-01-1998; 2008 HB125 06-25-2008

1753.08 [Repealed].

Effective Date: 10-01-1998; 2008 HB125 06-25-2008

1753.09 Terminating participation of provider.

(A) Except as provided in division (D) of this section, prior to terminating the participation of a provider on the basis of the participating provider's failure to meet the health insuring corporation's standards for quality or utilization in the delivery of health care services, a health insuring corporation shall give the participating provider notice of the reason or reasons for its decision to terminate the provider's participation and an opportunity to take corrective action. The health insuring corporation shall develop a performance improvement plan in conjunction with the participating provider. If after being afforded the opportunity to comply with the performance improvement plan, the participating provider fails to do so, the health insuring corporation may terminate the participation of the provider.

(B)

(1) A participating provider whose participation has been terminated under division (A) of this section may appeal the termination to the appropriate medical director of the health insuring corporation. The medical director shall give the participating provider an opportunity to discuss with the medical director the reason or reasons for the termination.

(2) If a satisfactory resolution of a participating provider's appeal cannot be reached under division (B)(1) of this section, the participating provider may appeal the termination to a panel composed of participating providers who have comparable or higher levels of education and training than the participating provider making the appeal. A representative of the participating provider's specialty shall be a member of the panel, if possible. This panel shall hold a hearing, and shall render its recommendation in the appeal within thirty days after holding the hearing. The recommendation shall be presented to the medical director and to the participating provider.

(3) The medical director shall review and consider the panel's recommendation before making a decision. The decision rendered by the medical director shall be final.

(C) A provider's status as a participating provider shall remain in effect during the appeal process set forth in division (B) of this section unless the termination was based on any of the reasons listed in division (D) of this section.

(D) Notwithstanding division (A) of this section, a provider's participation may be immediately terminated if the participating provider's conduct presents an imminent risk of harm to an enrollee or enrollees; or if there has occurred unacceptable quality of care, fraud, patient abuse, loss of clinical privileges, loss of professional liability coverage, incompetence, or loss of authority to practice in the participating provider's field; or if a governmental action has impaired the participating provider's ability to practice.

(E) Divisions (A) to (D) of this section apply only to providers who are natural persons.

(F)

(1) Nothing in this section prohibits a health insuring corporation from rejecting a provider's application for participation, or from terminating a participating provider's contract, if the health insuring corporation determines that the health care needs of its enrollees are being met and no need exists for the provider's or participating provider's services.

(2) Nothing in this section shall be construed as prohibiting a health insuring corporation from terminating a participating provider who does not meet the terms and conditions of the participating provider's contract.

(3) Nothing in this section shall be construed as prohibiting a health insuring corporation from terminating a participating provider's contract pursuant to any provision of the contract described in division (E)(2) of section 3963.02 of the Revised Code, except that, notwithstanding any provision of a contract described in that division, this section applies to the termination of a participating provider's contract for any of the causes described in divisions (A), (D), and (F)(1) and (2) of this section.

(G) The superintendent of insurance may adopt rules as necessary to implement and enforce sections 1753.06 , 1753.07 , and 1753.09 of the Revised Code. Such rules shall be adopted in accordance with Chapter 119. of the Revised Code.

Amended by 128th General AssemblyFile No.9, HB 1, §101.01, eff. 10/16/2009.

Effective Date: 10-01-1998; 2008 HB125 06-25-2008

1753.10 Categories of providers.

Nothing in this chapter or Chapter 1751. of the Revised Code requires a health insuring corporation to employ or contract with, or prohibits a health insuring corporation from employing or contracting with, any category of provider for the provision of basic or supplemental health care services, which health care services are within the recognized scope of practice of that category of provider.

Effective Date: 10-01-1998

1753.13 Obtaining covered obstetric and gynecological services without referral.

Every individual or group health insuring corporation policy, contract, or agreement that provides basic health care services but does not allow direct access to obstetricians or gynecologists shall permit a female enrollee to obtain covered obstetric and gynecological services from a participating obstetrician or gynecologist without obtaining a referral from the enrollee's primary care provider.

No individual or group health insuring corporation policy, contract, or agreement may limit the number of allowable visits to a participating obstetrician or gynecologist. A health insuring corporation may require a participating obstetrician or gynecologist to comply with the health insuring corporation's coverage protocols and procedures, including utilization review, for obstetric and gynecological services.

A health insuring corporation policy, contract, or agreement may not impose additional copayments for directly accessed obstetric and gynecological services, unless the policy, contract, or agreement imposes additional copayments for direct access to any participating provider other than a primary care provider.

Effective Date: 10-14-1999

1753.14 Procedures for standing referrals to specialists.

(A) A health insuring corporation that does not allow direct access to all specialists shall establish and implement a procedure by which an enrollee may receive a standing referral to a specialist. The procedure shall provide for a standing referral to a specialist if a primary care provider determines in consultation with a specialist that an enrollee needs continuing care from a specialist. The referral shall be made pursuant to a treatment plan approved by the health insuring corporation in consultation with the primary care provider, a specialist, and the enrollee. The treatment plan may limit the number of visits to the specialist, limit the period of time that the visits are authorized, or require that the specialist provide the primary care provider with regular reports on the health care provided to the enrollee.

(B) A health insuring corporation shall establish and implement a procedure by which an enrollee with a condition or disease that requires specialized medical care over a prolonged period of time and is life-threatening, degenerative, or disabling may receive a referral to a specialist who has expertise in treating the condition or disease for the purpose of having the specialist coordinate the enrollee's health care. The procedure shall provide for such a referral if a primary care provider determines in consultation with the specialist that the enrollee needs the specialist's expertise. The referral shall be made pursuant to a treatment plan approved by the health insuring corporation in consultation with the primary care provider, the specialist, and the enrollee. After the referral is made, the specialist is authorized to provide health care services to the enrollee in the same manner as the enrollee's primary care provider, subject to the terms of the treatment plan.

(C) The determinations described in divisions (A) and (B) of this section shall be made within three business days after a request for the determination is made by the enrollee or the enrollee's primary care provider and all appropriate medical records and other items of information necessary to make the determination have been provided.

(D) Once a determination in favor of a referral is made, the referral shall be made within four business days after the determination. This time period does not apply to standing referrals involving a rare or unusual condition for which appropriate specialists are limited in number or otherwise difficult to identify.

Divisions (A) and (B) of this section do not require a health insuring corporation to permit an enrollee to elect referral to a specialist who is not employed by or under contract with the health insuring corporation for the provision of health care services to the health insuring corporation's enrollees.

Effective Date: 10-01-1998

1753.16 Retroactively denying authorization.

A health insuring corporation or utilization review organization that authorizes a proposed admission, treatment, or health care service by a participating provider based upon the complete and accurate submission of all necessary information relative to an eligible enrollee shall not retroactively deny this authorization if the provider renders the health care service in good faith and pursuant to the authorization and all of the terms and conditions of the provider's contract with the health insuring corporation.

Effective Date: 10-01-1998

1753.21 Prescription drugs.

(A) If a policy, contract, or agreement of a health insuring corporation uses a restricted formulary of prescription drugs, the health insuring corporation shall do both of the following:

(1) Develop such a formulary in consultation with and with the approval of a pharmacy and therapeutics committee, a majority of the members of which are physicians affiliated with the health insuring corporation who may prescribe prescription drugs and pharmacists affiliated with the health insuring corporation; or in consultation with and with the approval of a pharmacy and therapeutics committee that is independent of the health insuring corporation consisting of physicians who may prescribe prescription drugs in their state of licensure and pharmacists who are authorized to practice in their state of licensure;

(2) Establish a procedure by which an enrollee may obtain, without penalty or additional cost sharing beyond that provided for formulary drugs under the enrollee's contract with the health insuring corporation, coverage of a specific nonformulary drug when the prescriber documents in the enrollee's medical record and certifies that the formulary alternative has been ineffective in the treatment of the enrollee's disease or condition, or that the formulary alternative causes or is reasonably expected by the prescriber to cause a harmful or adverse reaction in the enrollee.

(B) Nothing in this section shall be construed to require a health insuring corporation to place any particular pharmaceutical product or therapeutic class of product on any formulary, or to prohibit a health insuring corporation from restricting payments for any specific pharmaceutical product or therapeutic class of product, including, but not limited to, a requirement that the product be prescribed only by a defined specialist or subspecialist.

Effective Date: 10-01-1998

1753.23 Internal technology assessment process.

A health insuring corporation that provides basic health care services shall establish or use an internal technology assessment process for assessing whether a drug, device, protocol, procedure, or other therapy is proven to be safe and efficacious for a particular indication or condition when compared to alternative therapies, or whether it remains experimental or investigational. The health insuring corporation's internal technology assessment process shall meet all of the following criteria:

(A) Decisions are made by medical professionals, including physicians.

(B) The process includes a review of relevant medical evidence, including the following, if available:

(1) Peer-reviewed medical and scientific literature on the subject;

(2) Published opinions, actions, and other relevant documents of independent, external research organizations such as the national institute of health, the national cancer institute, the United States food and drug administration, the health care finance administration, and the agency for health care policy and research;

(3) Published opinions of medical experts or affected specialty societies.

(C) General coverage decisions, made pursuant to this process, that exclude drugs, devices, protocols, procedures, or other therapies on the basis that they are not safe or efficacious and remain experimental or investigational, are reviewed and updated as new scientific evidence becomes available.

(D) A description of the health insuring corporation's internal technology assessment process is made available to participating providers and enrollees, upon request.

(E) A copy of the health insuring corporation's specific coverage protocols and procedures is made available to participating providers and enrollees upon the request of an enrollee who has been denied coverage for a drug, device, protocol, procedure, or other therapy on the basis that it has been assessed as not being safe or efficacious for a particular indication or condition. Specific coverage protocols and procedures shall include a description of the evidence upon which the protocol or procedure is based, and shall contain the date the protocol or procedure was adopted.

(F) A drug or device that has received full market approval by the United States food and drug administration for treatment of a particular indication or condition cannot, for purposes of this assessment process, be considered experimental or investigational for that indication or condition.

Effective Date: 10-01-1998

1753.24 Amended and Renumbered RC 1751.85.

Effective Date: 05-01-2000

1753.28 Emergency services coverage.

(A) As used in this section:

(1) "Emergency medical condition" means a medical condition that manifests itself by such acute symptoms of sufficient severity, including severe pain, that a prudent layperson with an average knowledge of health and medicine could reasonably expect the absence of immediate medical attention to result in any of the following:

(a) Placing the health of the individual or, with respect to a pregnant woman, the health of the woman or her unborn child, in serious jeopardy;

(b) Serious impairment to bodily functions;

(c) Serious dysfunction of any bodily organ or part.

(2) "Emergency services" means the following:

(a) A medical screening examination, as required by federal law, that is within the capability of the emergency department of a hospital, including ancillary services routinely available to the emergency department, to evaluate an emergency medical condition;

(b) Such further medical examination and treatment that are required by federal law to stabilize an emergency medical condition and are within the capabilities of the staff and facilities available at the hospital, including any trauma and burn center of the hospital.

(3)

(a) "Stabilize" means the provision of such medical treatment as may be necessary to assure, within reasonable medical probability, that no material deterioration of an individual's medical condition is likely to result from or occur during a transfer, if the medical condition could result in any of the following:

(i) Placing the health of the individual or, with respect to a pregnant woman, the health of the woman or her unborn child, in serious jeopardy;

(ii) Serious impairment to bodily functions;

(iii) Serious dysfunction of any bodily organ or part.

(b) In the case of a woman having contractions, "stabilize" means such medical treatment as may be necessary to deliver, including the placenta.

(4) "Transfer" has the same meaning as in section 1867 of the "Social Security Act," 49 Stat. 620 (1935), 42 U.S.C.A. 1395dd , as amended.

(B) A health insuring corporation policy, contract, or agreement providing coverage of basic health care services shall cover emergency services for enrollees with emergency medical conditions without regard to the day or time the emergency services are rendered or to whether the enrollee, the hospital's emergency department where the services are rendered, or an emergency physician treating the enrollee, obtained prior authorization for the emergency services.

(C) A health insuring corporation policy, contract, or agreement providing coverage of basic health care services shall cover both of the following:

(1) Emergency services provided to an enrollee at a participating hospital's emergency department if the enrollee presents self with an emergency medical condition;

(2) Emergency services provided to an enrollee at a nonparticipating hospital's emergency department if the enrollee presents self with an emergency medical condition and one of the following circumstances applies:

(a) Due to circumstances beyond the enrollee's control, the enrollee was unable to utilize a participating hospital's emergency department without serious threat to life or health.

(b) A prudent layperson with an average knowledge of health and medicine would have reasonably believed that, under the circumstances, the time required to travel to a participating hospital's emergency department could result in one or more of the adverse health consequences described in division (A)(1) of this section.

(c) A person authorized by the health insuring corporation refers the enrollee to an emergency department and does not specify a participating hospital's emergency department.

(d) An ambulance takes the enrollee to a nonparticipating hospital other than at the direction of the enrollee.

(e) The enrollee is unconscious.

(f) A natural disaster precluded the use of a participating emergency department.

(g) The status of a hospital changed from participating to nonparticipating with respect to emergency services during a contract year and no good faith effort was made by the health insuring corporation to inform enrollees of this change.

(D) A health insuring corporation that provides coverage for emergency services shall inform enrollees of all of the following:

(1) The scope of coverage for emergency services;

(2) The appropriate use of emergency services, including the use of the 9-1-1 system and any other telephone access systems utilized to access prehospital emergency services;

(3) Any cost sharing provisions for emergency services;

(4) The procedures for obtaining emergency services and other medical services, so that enrollees are familiar with the location of the emergency departments of participating hospitals and with the location and availability of other participating facilities or settings at which they could receive medical services.

Effective Date: 10-01-1998

1753.281 [Repealed].

Effective Date: 03-31-2005; 03-30-2005

1753.30 Other insurance provisions.

Nothing in this chapter shall prevent or otherwise affect the application to any health care plan of those provisions of Title XVII [17] or XXXIX [39] of the Revised Code that would otherwise apply.

Effective Date: 10-01-1998

1753.31 Risk-based capital for insurers model act definitions.

As used in sections 1753.31 to 1753.43 of the Revised Code:

(A) "Adjusted RBC report" means an RBC report that has been adjusted by the superintendent of insurance in accordance with division (C) of section 1753.32 of the Revised Code.

(B) "Authorized control level RBC" means the number determined under the risk-based capital formula in accordance with the RBC instructions.

(C) "Company action level RBC" means the product of 2.0 and a health insuring corporation's authorized control level RBC.

(D) "Corrective order" means an order issued by the superintendent of insurance specifying corrective actions that the superintendent determines are required.

(E) "Domestic health insuring corporation" means a health insuring corporation domiciled in this state.

(F) "Foreign health insuring corporation" means a health insuring corporation holding a certificate of authority under Chapter 1751. of the Revised Code that is domiciled outside of this state.

(G) "Mandatory control level RBC" means the product of .70 and a health insuring corporation's authorized control level RBC.

(H) "NAIC" means the national association of insurance commissioners.

(I) "Net worth" means statutory capital and surplus.

(J) "RBC" means risk-based capital.

(K) "RBC instructions" means the RBC report, including risk-based capital instructions, as adopted by the NAIC and as amended by the NAIC from time to time in accordance with the procedures adopted by the NAIC. "RBC instructions" also includes any modifications adopted by the superintendent of insurance, as the superintendent considers to be necessary.

(L) "RBC level" means a health insuring corporation's action level RBC, regulatory action level RBC, authorized control level RBC, or mandatory control level RBC.

(M) "RBC plan" means a comprehensive financial plan containing the elements specified in division (B) of section 1753.33 of the Revised Code.

(N) "RBC report" means the report required by section 1753.32 of the Revised Code.

(O) "Regulatory action level RBC" means the product of 1.5 and a health insuring corporation's authorized control level RBC.

(P) "Revised RBC plan" means an RBC plan rejected by the superintendent of insurance and then revised by a health insuring corporation with or without incorporating the superintendent's recommendations.

(Q) "Total adjusted capital" means the sum of both of the following:

(1) A health insuring corporation's net worth as determined in accordance with the statutory accounting applicable to the annual financial statements required to be filed under section 1751.32 of the Revised Code;

(2) Such other items, if any, as the RBC instructions may provide.

Effective Date: 03-15-2001

1753.32 Annual report.

(A) Each domestic health insuring corporation shall, on or prior to the first day of March of every year, prepare and submit to the superintendent of insurance a report on its RBC levels as of the end of the calendar year just ended, in a form and containing such information as is required by the RBC instructions. In addition, a domestic health insuring corporation shall file its RBC report as follows:

(1) With the NAIC, in accordance with the RBC instructions;

(2) With the insurance regulatory authority of any other state in which the health insuring corporation is authorized to do business, if the insurance regulatory authority of that state has sent a written request to the health insuring corporation for the RBC report. The health insuring corporation shall file an RBC report with the requesting state no later than the later of:

(a) Fifteen days after the health insuring corporation's receipt of the insurance regulatory authority's request for the RBC report;

(b) Prior to the first day of March.

(B) A health insuring corporation's RBC levels shall be determined in accordance with the formula set forth in the RBC instructions. The formula shall take the following risks into account, and may adjust for the covariance between these risks, as determined in each case by applying the factors in the manner set forth in the RBC instructions:

(1) Asset risk;

(2) Credit risk;

(3) Underwriting risk;

(4) All other business risks and such other relevant risks as are set forth in the RBC instructions.

(C) If a domestic health insuring corporation files an RBC report that in the judgment of the superintendent is inaccurate, the superintendent shall adjust the RBC report to correct the inaccuracy and then shall provide a copy of the adjusted RBC report to the health insuring corporation. The superintendent shall also provide the health insuring corporation with a statement of the reasons for any adjustment.

(D) In enacting sections 1753.31 to 1753.43 of the Revised Code, the general assembly finds all of the following:

(1) An excess of capital over the amount produced by the risk-based capital requirements of sections 1753.31 to 1753.43 of the Revised Code, and the formulas, schedules, and instructions referenced in sections 1753.31 to 1753.43 of the Revised Code, is desirable in the business of insurance.

(2) Health insuring corporations, accordingly, should seek to maintain capital above the RBC levels required by sections 1753.31 to 1753.43 of the Revised Code.

(3) Additional capital is used and is useful in the business of insurance, helping to secure a health insuring corporation against various risks inherent in, or affecting, the business of insurance, which risks are not accounted for or are only partially measured by the risk-based capital requirements of sections 1753.31 to 1753.43 of the Revised Code.

Effective Date: 03-15-2001

1753.33 Company action level event.

(A) For purposes of sections 1753.31 to 1753.43 of the Revised Code, a "company action level event" is any of the following events:

(1) A health insuring corporation's filing of an RBC report that indicates that the health insuring corporation's total adjusted capital is greater than or equal to its regulatory action level RBC but less than its company action level RBC;

(2) A health insuring corporation's filing of an RBC report that indicates that the health insuring corporation's total adjusted capital is greater than or equal to its company action level RBC but less than the product of its authorized control level RBC and 3.0, and that triggers the trend test determined in accordance with the trend test calculation included in the RBC instructions;

(3) The notification by the superintendent of insurance to a health insuring corporation of an adjustment to the health insuring corporation's RBC report, which adjusted RBC report shows the health insuring corporation's total adjusted capital within the range described in division (A)(1) of this section, provided that the health insuring corporation does not challenge the adjusted RBC report under section 1753.37 of the Revised Code;

(4) The notification by the superintendent to a health insuring corporation, following the hearing required under section 1753.37 of the Revised Code, that the superintendent has rejected the health insuring corporation's challenge to an adjusted RBC report showing the health insuring corporation's total adjusted capital within the range described in division (A)(1) of this section.

(B) In the case of a company action level event, the health insuring corporation shall prepare and submit to the superintendent an RBC plan that shall do all of the following:

(1) Identify the conditions that contributed to the company action level event;

(2) Contain proposals of corrective actions that the health insuring corporation intends to take to eliminate the conditions contributing to the company action level event;

(3) Provide projections of the health insuring corporation's financial results in the current year and at least the two succeeding years, both in the absence of the proposed corrective actions and giving effect to the proposed corrective actions. The projections shall include projections of statutory balance sheets, operating income, net income, capital, surplus, and RBC levels. Projections for both new and renewal business may include separate projections for each major line of business, and may separately identify each significant income, expense, and benefit component of the projection.

(4) Identify the key assumptions impacting the health insuring corporation's projections made pursuant to division (B)(3) of this section, and describe the sensitivity of the projections to the assumptions;

(5) Identify the quality of, and problems associated with, the health insuring corporation's business, including, but not limited to, its assets, anticipated business growth and associated surplus strain, extraordinary exposure to risk, mix of business, and the use of reinsurance, if any, in each case.

(C) The RBC plan shall be submitted within forty-five days after a company action level event. However, if a health insuring corporation has challenged an adjusted RBC report pursuant to section 1753.37 of the Revised Code, an RBC plan need not be submitted unless the superintendent rejects the challenge following the hearing required under section 1753.37 of the Revised Code. If the superintendent rejects the health insuring corporation's challenge, the RBC plan shall be submitted within forty-five days after the superintendent's notification to the health insuring corporation of the superintendent's rejection of the challenge.

(D)

(1) Within sixty days after a health insuring corporation submits an RBC plan to the superintendent, the superintendent shall either require the health insuring corporation to implement the RBC plan or notify the health insuring corporation that the RBC plan is unsatisfactory in the judgment of the superintendent. If the superintendent has determined that the RBC plan is unsatisfactory, the notification to the health insuring corporation shall set forth the reasons for the determination, and may set forth proposed revisions that will render the RBC plan satisfactory in the judgment of the superintendent. Upon its receipt of such notification from the superintendent, the health insuring corporation shall prepare and submit a revised RBC plan, which may incorporate by reference any revisions proposed by the superintendent.

(2) If a health insuring corporation challenges, under section 1753.37 of the Revised Code, a notification by the superintendent that the health insuring corporation's RBC plan or a revised RBC plan is unsatisfactory, submission of a revised RBC plan need not be made unless the superintendent rejects the health insuring corporation's challenge and notifies the health insuring corporation of this rejection. A health insuring corporation shall submit a revised RBC plan to the superintendent within forty-five days after receiving notification from the superintendent that its RBC plan is unsatisfactory, or that its challenge to a notification made under division (D)(1) of this section has been rejected, as applicable.

(E) Notwithstanding division (D) of this section, if the superintendent notifies a health insuring corporation that its RBC plan or revised RBC plan is unsatisfactory, the superintendent may, at the superintendent's discretion but subject to the health insuring corporation's right to a hearing under section 1753.37 of the Revised Code, specify in the notification that the notification constitutes a regulatory action level event.

(F) Every domestic health insuring corporation that submits an RBC plan or revised RBC plan to the superintendent shall file a copy of the RBC plan or revised RBC plan with the insurance regulatory authority of every state in which the health insuring corporation is authorized to do business upon receiving the insurance regulatory authority's written request for a copy of the plan, if the state has a confidentiality law substantially similar to section 1753.38 of the Revised Code. The health insuring corporation shall file the copy in that state no later than the later of:

(1) Fifteen days after receiving the request for a copy of the plan;

(2) The date on which the RBC plan or revised RBC plan is filed pursuant to division (C) or (D) of this section.

Amended by 128th General AssemblyFile No.18, HB 300, §1, eff. 1/1/2012.

Effective Date: 03-15-2001

1753.34 Regulatory action level event.

(A) For purposes of sections 1753.31 to 1753.43 of the Revised Code, a "regulatory action level event" is any of the following events:

(1) The filing of an RBC report by a health insuring corporation that indicates that the health insuring corporation's total adjusted capital is greater than or equal to its authorized control level RBC but less than its regulatory action level RBC;

(2) The notification by the superintendent of insurance to a health insuring corporation of an adjustment to the health insuring corporation's RBC report, which adjusted RBC report shows the health insuring corporation's total adjusted capital within the range described in division (A)(1) of this section, provided that the health insuring corporation does not challenge the adjusted RBC report under section 1753.37 of the Revised Code;

(3) The notification by the superintendent to a health insuring corporation, following the hearing required under section 1753.37 of the Revised Code, that the superintendent has rejected the health insuring corporation's challenge to an adjusted RBC report showing the health insuring corporation's total adjusted capital within the range described in division (A)(1) of this section;

(4) The failure of a health insuring corporation to file an RBC report by the first day of March of every year, unless the health insuring corporation has provided an explanation for such failure that is satisfactory to the superintendent and has cured the failure within ten days after the filing date;

(5) The failure of a health insuring corporation to submit an RBC plan to the superintendent within the time period set forth in division (C) of section 1753.33 of the Revised Code;

(6) The notification by the superintendent to a health insuring corporation of both of the following:

(a) The RBC plan or revised RBC plan submitted by the health insuring corporation is unsatisfactory in the judgment of the superintendent;

(b) The notification by the superintendent constitutes a regulatory action level event with respect to the health insuring corporation, provided that the health insuring corporation does not challenge the determination under section 1753.37 of the Revised Code.

(7) The notification by the superintendent to a health insuring corporation, following the hearing required under section 1753.37 of the Revised Code, that the superintendent has rejected the health insuring corporation's challenge to the superintendent's determination under division (A)(6) of this section;

(8) The notification by the superintendent to a health insuring corporation that the superintendent has determined that the health insuring corporation has failed to adhere to its RBC plan or revised RBC plan, and this failure has had a substantial adverse effect on the ability of the health insuring corporation to eliminate the conditions leading to the company action level event in accordance with its RBC plan or revised RBC plan, provided that the health insuring corporation does not challenge this determination under section 1753.37 of the Revised Code;

(9) The notification by the superintendent to a health insuring corporation, following the hearing required under section 1753.37 of the Revised Code, that the superintendent has rejected the health insuring corporation's challenge to the superintendent's determination under division (A)(8) of this section.

(B) In the case of a regulatory action level event, the superintendent shall do all of the following:

(1) Require the health insuring corporation to prepare and submit an RBC plan or, if applicable, a revised RBC plan;

(2) Perform such examinations and analyses as the superintendent considers necessary of the assets, liabilities, and operations of the health insuring corporation, including a review of the health insuring corporation's RBC plan or revised RBC plan and the results of any sensitivity tests undertaken pursuant to the RBC instructions;

(3) Issue a corrective order, based upon the examinations and analyses performed under division (B)(2) of this section.

(C)

(1) The RBC plan or revised RBC plan required by division (B)(1) of this section shall be submitted to the superintendent within forty-five days after the regulatory action level event, except by a health insuring corporation that files a challenge to an adjusted RBC report or revised RBC plan pursuant to section 1753.37 of the Revised Code. If the superintendent determines the challenge is frivolous, the time limit for the submission of the RBC plan or revised RBC plan shall not be altered by the filing of the challenge.

(2) If a health insuring corporation files a nonfrivolous challenge to an adjusted RBC report or revised RBC plan, the RBC plan or revised RBC plan required by division (B)(1) of this section shall only be submitted to the superintendent if the superintendent rejects the challenge following the hearing required under section 1753.37 of the Revised Code. If the superintendent rejects the health insuring corporation's challenge, the RBC plan or revised RBC plan shall be submitted within forty-five days after the superintendent's notification to the health insuring corporation of the superintendent's rejection of the challenge.

(D) The superintendent may retain actuaries, investment experts, and such other consultants, as may be necessary in the superintendent's judgment, to review a health insuring corporation's RBC plan or revised RBC plan, to examine or analyze the assets, liabilities, and operation of the health insuring corporation, and to formulate a corrective order for the health insuring corporation. The fees, costs, and expenses relating to these consultants shall be borne by the affected health insuring corporation.

Effective Date: 03-15-2001

1753.35 Authorized control level event.

(A) For purposes of sections 1753.31 to 1753.43 of the Revised Code, an "authorized control level event" is any of the following events:

(1) The filing of an RBC report by a health insuring corporation that indicates that the health insuring corporation's total adjusted capital is greater than or equal to its mandatory control level RBC but less than its authorized control level RBC;

(2) The notification by the superintendent of insurance to a health insuring corporation of an adjustment to the health insuring corporation's RBC report, which adjusted RBC report shows the health insuring corporation's total adjusted capital within the range described in division (A)(1) of this section, provided that the health insuring corporation does not challenge the adjusted RBC report under section 1753.37 of the Revised Code;

(3) The notification by the superintendent to a health insuring corporation, following the hearing required under section 1753.37 of the Revised Code, that the superintendent has rejected the health insuring corporation's challenge to an adjusted RBC report showing the health insuring corporation's total adjusted capital within the range described in division (A)(1) of this section;

(4) The failure of a health insuring corporation to respond, in a manner satisfactory to the superintendent, to a corrective order issued under division (B)(3) of section 1753.34 of the Revised Code, provided that the health insuring corporation does not challenge the corrective order under section 1753.37 of the Revised Code;

(5) The failure of a health insuring corporation to respond, in a manner satisfactory to the superintendent, to a corrective order issued under division (B)(3) of section 1753.34 of the Revised Code subsequent to the superintendent's modification of an earlier order or the superintendent's rejection of the health insuring corporation's challenge of the order under section 1753.37 of the Revised Code.

(B) In the case of an authorized control level event, the superintendent shall do the following:

(1) Take the actions required under section 1753.34 of the Revised Code for regulatory action level events;

(2) If the superintendent considers it to be in the best interests of the subscribers and creditors of the health insuring corporation and of the public, take such actions as are necessary to place the health insuring corporation under regulatory control under sections 3903.01 to 3903.59 of the Revised Code. The authorized control level event shall be deemed sufficient grounds for the superintendent to take action under sections 3903.01 to 3903.59 of the Revised Code. Nothing in sections 1753.31 to 1753.43 of the Revised Code shall impair or restrict the rights, powers, and protections afforded to the superintendent and to health insuring corporations under sections 3903.01 to 3903.59 of the Revised Code.

Effective Date: 03-15-2001

1753.36 Mandatory control level event.

(A) For purposes of sections 1753.31 to 1753.43 of the Revised Code, a "mandatory control level event" is any of the following events:

(1) The filing of an RBC report by a health insuring corporation that indicates that the health insuring corporation's total adjusted capital is less than its mandatory control level RBC;

(2) The notification by the superintendent of insurance to a health insuring corporation of an adjustment to the health insuring corporation's RBC report, which adjusted RBC report shows the health insuring corporation's total adjusted capital at less than its mandatory control level RBC, provided the health insuring corporation does not challenge the adjusted RBC report under section 1753.37 of the Revised Code;

(3) The notification by the superintendent to the health insuring corporation, following the hearing required under section 1753.37 of the Revised Code, that the superintendent has rejected the health insuring corporation's challenge to an adjusted RBC report.

(B) In the case of a mandatory control level event, the superintendent shall take such actions as are necessary to place the health insuring corporation under regulatory control under sections 3903.01 to 3903.59 of the Revised Code. The mandatory control level event shall be deemed sufficient grounds for the superintendent to take action under sections 3903.01 to 3903.59 of the Revised Code. Nothing in sections 1753.31 to 1753.43 of the Revised Code shall impair or restrict the rights, powers, and protections afforded to the superintendent and to health insuring corporations under sections 3903.01 to 3903.59 of the Revised Code. However, the superintendent may defer action under this division for up to ninety days after the mandatory control level event if the superintendent finds that there is a reasonable expectation the health insuring corporation may be able to eliminate the conditions leading to the mandatory control level event within the ninety-day period.

Effective Date: 03-15-2001

1753.37 Right to confidential hearing - request for hearing - challenge to determination or action.

(A) A health insuring corporation has the right to a confidential hearing upon receiving any of the following from the superintendent of insurance:

(1) An adjusted RBC report;

(2) Notification that the health insuring corporation's RBC plan or revised RBC plan is unsatisfactory and a statement that the notification constitutes a regulatory action level event for the health insuring corporation;

(3) Notification that the superintendent has determined that the health insuring corporation has failed to adhere to its RBC plan or revised RBC plan, which failure has a substantial adverse effect on the ability of the health insuring corporation to eliminate the conditions leading to a company action level event in accordance with its RBC plan or revised RBC plan;

(4) A corrective order issued under division (B)(3) of section 1753.34 of the Revised Code.

(B) A health insuring corporation shall notify the superintendent of its request for a hearing within five days after its receipt of any item listed in division (A) of this section. Upon the superintendent's receipt of the health insuring corporation's request for a hearing, the superintendent shall set a date for the hearing, which date shall be no less than ten days and no more than thirty days after the superintendent's receipt of the health insuring corporation's request.

(C) A health insuring corporation may challenge any determination or action taken by the superintendent under sections 1753.31 to 1753.43 of the Revised Code at the hearing held pursuant to this section.

Effective Date: 03-15-2001

1753.38 Confidentiality.

(A) The superintendent of insurance shall keep all of the following confidential:

(1) An RBC report, to the extent that information contained in the report is not required to be included in an annual statement available to the public;

(2) An RBC plan;

(3) The results of, or reports on, examinations or analyses conducted pursuant to division (B)(2) of section 1753.34 of the Revised Code, and a corrective order issued pursuant to division (B)(3) of section 1753.34 of the Revised Code.

A disclosure to the superintendent of these plans, reports, information, and orders does not constitute a waiver of any applicable privilege or claim of confidentiality in the plans, reports, information, and orders.

(B) Notwithstanding division (A) of this section:

(1) The plans, reports, information, and orders described in division (A) of this section may be used by the superintendent in accordance with the insurance laws of this state.

(2) In the performance of the superintendent's duties, the superintendent may share the plans, reports, information, and orders with state, federal, and international regulatory agencies and law enforcement authorities, and with the NAIC and its affiliates and subsidiaries, provided that the recipient agrees to maintain the confidentiality of the plans, reports, information, and orders.

(C)

(1) The plans, reports, information, and orders described in division (A) of this section are not public records for purposes of section 149.43 of the Revised Code and shall not be subject to subpoena. The plans, reports, information, and orders shall not be subject to discovery or admissible in evidence in any private civil action.

(2) Neither the superintendent nor any person who receives the plans, reports, information, and orders while acting under the authority of the superintendent shall be permitted or required to testify in any private civil action concerning these plans, reports, information, and orders.

(D) A comparison of a health insuring corporation's total adjusted capital to any of its RBC levels shall not be used to rank health insuring corporations.

(E) RBC instructions, RBC reports, adjusted RBC reports, RBC plans, and revised RBC plans shall not be used by the superintendent for ratemaking, considered or introduced as evidence in any rate proceeding, or used by the superintendent to calculate or derive any elements of an appropriate premium level or rate of return for any line of insurance that a health insuring corporation or any affiliate is authorized to write.

(F) Except as otherwise required under Chapter 1751. or 1753. of the Revised Code, it is an unfair and deceptive act or practice in the business of insurance under sections 3901.19 to 3901.26 of the Revised Code for any person to make, publish, disseminate, circulate, or place before the public, or to cause, directly or indirectly, to be made, published, disseminated, circulated, or placed before the public, in a newspaper, magazine, or other publication, in the form of a notice, circular, pamphlet, letter, or poster, or over any radio or television station, or in any other manner, an advertisement, announcement, or statement, written or oral, that contains an assertion, representation, or statement, regarding the RBC levels of a health insuring corporation, or any component derived in the calculation of the RBC levels.

(G) If any materially false statement is published comparing a health insuring corporation's total adjusted capital to its RBC levels, or any inappropriate comparison of any other amount to any of the health insuring corporation's RBC levels is published, and the health insuring corporation is able to demonstrate to the superintendent with substantial proof the falsity of the statement or the inappropriateness of the comparison, then the health insuring corporation may publish with the superintendent's approval an announcement in a written publication to rebut the materially false statement or inappropriate comparison.

Effective Date: 03-15-2001

1753.39 Foreign health insuring corporation.

(A) Each foreign health insuring corporation shall submit to the superintendent of insurance, upon receiving the superintendent's written request, an RBC report for the calendar year just ended. The health insuring corporation shall submit the RBC report to the superintendent no later than the later of:

(1) The date a domestic health insuring corporation would be required to file an RBC report under section 1753.32 of the Revised Code;

(2) Fifteen days after the superintendent's request is received by the foreign health insuring corporation.

(B) Each foreign health insuring corporation shall, upon receiving the superintendent's written request, promptly submit to the superintendent a copy of any RBC plan or revised RBC plan filed with the insurance regulatory authority of any other state.

(C) The superintendent may require a foreign health insuring corporation to file an RBC plan with the superintendent in the case of a company action level event, regulatory action level event, or authorized control level event involving the foreign health insuring corporation, if the insurance regulatory authority of the state of domicile of the foreign health insuring corporation fails to require the foreign health insuring corporation to file an RBC plan in the manner specified under that state's RBC laws, if any. The failure of a foreign health insuring corporation to file an RBC plan or revised RBC plan with the superintendent as required shall be grounds for the superintendent to order the health insuring corporation to cease and desist from writing new business in this state.

(D) In the case of a mandatory control level event involving a foreign health insuring corporation, if no domiciliary receiver has been appointed for the foreign health insuring corporation under the rehabilitation and liquidation laws applicable in the state of domicile of the foreign health insuring corporation, the superintendent may make application to the court of common pleas as permitted in sections 3903.50 to 3903.59 of the Revised Code for an order directing the superintendent to liquidate the property of the foreign health insuring corporation found in this state. The occurrence of the mandatory control level event shall be deemed sufficient grounds for the superintendent to make application to the court.

Effective Date: 03-15-2001

1753.40 Immunity.

There shall be no liability on the part of, and no cause of action shall arise against, the superintendent of insurance, or the department of insurance, its employees, or its agents, for any action taken in their performance of the powers and duties under sections 1753.31 to 1753.43 of the Revised Code.

Effective Date: 03-15-2001

1753.41 When notices are effective.

Unless otherwise provided, all notices sent to a health insuring corporation by the superintendent of insurance that may result in regulatory action under sections 1753.31 to 1753.43 of the Revised Code shall be effective upon dispatch if transmitted by registered or certified mail. Any other notice transmitted shall be effective upon the health insuring corporation's receipt of the notice.

Effective Date: 03-15-2001

1753.42 Requirements for exemption of domestic corporation.

The superintendent of insurance may exempt any domestic health insuring corporation from the application of sections 1753.31 to 1753.43 of the Revised Code, if the health insuring corporation meets all of the following requirements:

(A) The health insuring corporation writes direct business in this state only.

(B) The health insuring corporation assumes no reinsurance in excess of five per cent of direct premium written.

(C) The health insuring corporation either:

(1) Writes direct annual premiums of two million dollars or less for basic health care services;

(2) Covers less than two thousand enrollees under policies, contracts, certificates, or agreements for supplemental health care services.

Effective Date: 03-15-2001

1753.43 Rules.

The superintendent of insurance may adopt rules in accordance with Chapter 119. of the Revised Code as are reasonably necessary for the implementation and operation of sections 1753.31 to 1753.43 of the Revised Code.

Effective Date: 03-15-2001