| (a) An applicant for a certificate of authority to
operate an HMO must have unencumbered assets that satisfy the requirements
of Insurance Code §843.403 (concerning Minimum Net Worth).
(b) For the purpose of calculating assets to satisfy
the minimum net worth requirements of Insurance Code §843.403,
lawful money of the United States of America includes deposits in
an institution that is a member of the Federal Deposit Insurance Corporation.
Demand deposits, savings deposits, or time deposits, of the type that
are federally insured in solvent banks, savings and loan associations,
and their branches, which are organized under the laws of the United
States of America or under the laws of any state of the United States
of America may not exceed the greater of:
(1) the amount of federal deposit insurance coverage
pertaining to the deposit; or
(2) 10 percent of the issuing financial institution's
equity, provided that the institution's equity is in excess of $25
million.
(c) The applicant must maintain unencumbered assets
in excess of all of its liabilities by an amount equal to or greater
than the minimum net worth requirement until it receives its certificate
of authority; then the HMO must meet the minimum net worth requirements
of Insurance Code §843.403 by maintaining unencumbered assets
in excess of its liabilities by an amount equal to or greater than
the minimum net worth requirement.
(d) Foreign HMOs seeking admission to this state, which
are actively conducting business in other states, and approved nonprofit
health corporations authorized under Insurance Code §844.005
(concerning Provision of Certain Services on Behalf of Health Maintenance
Organizations), are required, at a minimum, to comply with Insurance
Code §843.403.
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