Code of Massachusetts Regulations
211 CMR - DIVISION OF INSURANCE
Title 211 CMR 43.00 - Health Maintenance Organizations (HMOs)
Section 43.05 - Deposit Requirements
Current through Register 1531, September 27, 2024
(1) Except as provided in 211 CMR 43.05(2) and (3), each HMO shall maintain a deposit with a trustee acceptable to the Commissioner through which a custodial or controlled account is utilized of cash, securities or any combination of these or other measures that are acceptable to him or her, which is to be used exclusively to protect the interests of policyholders, enrolled members, and the general public and which at all times shall have a value of not less than $1,000,000.
(2) All income from the deposit shall be an asset of the HMO. A HMO that has made a securities deposit may withdraw that deposit or any part thereof after making a substitute deposit of cash, securities or any combination of these or other measures of equal amount and value. The Commissioner shall approve any securities before they are deposited or substituted.
(3) The Commissioner may reduce or eliminate the deposit requirement if the HMO deposits with the state treasurer, insurance Commissioner or other official body of the state or jurisdiction of domicile, for the protection of policyholders, enrolled members and subscribers of such HMO and the general public, cash, acceptable securities or surety, and delivers to the Commissioner a certificate to such effect, duly authenticated by the appropriate entity holding the deposit.
(4) If in the opinion of the Commissioner the deposit requirement as established above would be inadequate to protect the interests of enrolled members, the deposit shall be appropriately adjusted in order to protect the interests of policyholders, enrolled members and subscribers of the HMO and the general public.
(5) The deposit shall be an admitted asset of the HMO in the determination of net worth pursuant to M.G.L. c. 176G, § 25. The Commissioner may use the deposit for administrative costs directly attributable to any receivership, administrative supervision, rehabilitation or liquidation pursuant to M.G.L. c. 176G, § 20. If the HMO is ordered into receivership, administrative supervision, rehabilitation or liquidation, the deposit shall be an asset subject to the provisions of M.G.L. c. 176G, § 20.
