Colorado § 10-16-412 - Statutory deposit.

§ 10-16-412. Statutory deposit.

(1) Unless otherwise provided in subsections (2) and (3) of this section, each health maintenance organization shall furnish cash or securities acceptable to the commissioner to be held by the commissioner under joint control in the same manner as prescribed in sections 10-3-206, 10-3-210, and 10-3-211. The primary purpose of this deposit shall be to protect the interests of the enrollees and to assure continuation of health-care services to enrollees of a health maintenance organization and to cover reasonable administration costs attributed to rehabilitation, liquidation, or conservation under section 10-16-418.

(2) (a) Every health maintenance organization shall have an initial deposit of three hundred thousand dollars.

(b) (Deleted by amendment, L. 99, p. 83, § 3, effective July 1, 1999.)

(3) Health maintenance organizations shall establish and maintain the following minimum deposits:

(a) The following schedule, based upon enrollment levels achieved on December 31 of the preceding year:

(I) to (III) (Deleted by amendment, L. 99, p. 83, § 3, effective July 1, 1999.)

(IV) $300,000: Enrollment of less than 60,000;

(V) $350,000: Enrollment of 60,000 but less than 100,000;

(VI) $400,000: Enrollment of 100,000 or more.

(b) The statutory deposit shall at all times equal or exceed twenty-five percent of the health maintenance organization's uncovered expenditures for the previous calendar year. At such time as the deposit is less than twenty-five percent of the health maintenance organization's uncovered expenditures for the previous calendar year, additional deposits will be required to maintain this level. The maximum deposit required, however, shall not exceed one million dollars.

(4) (a) If the initial application of this section would create undue financial risks to the enrollees of a health maintenance organization, such health maintenance organization may, within thirty days after July 1, 1999, file with the commissioner a request to phase in the requirements of this section over a period not to exceed three years or another time period as approved by the commissioner.

(b) Any request made pursuant to paragraph (a) of this subsection (4) shall include a complete analysis, in a form prescribed by the commissioner, of the impact upon the health maintenance organization making the request, that is expected to result from application of this section and, if a phase-in is requested, a description of the health maintenance organization's plan for the phase-in period. The commissioner shall not deny a request for a phase-in except upon notice and an opportunity for a hearing as provided in section 24-4-105, C.R.S.

(c) Any request for a hearing made pursuant to paragraph (b) of this subsection (4) shall include a description of the basis upon which relief is sought. Upon receipt of such a request, the commissioner shall, with regard to the health maintenance organization making the request, postpone the effective date of the section pending the conclusion of the hearing and the taking of final agency action thereon. The hearing shall commence within sixty days after the commissioner receives the request and shall be conducted in accordance with section 24-4-105, C.R.S.

Source: L. 92: Entire article R&RE, p. 1704, § 1, effective July 1. L. 99: (2) and (3) amended and (4) added, p. 83, § 3, effective July 1. L. 2019: (3)(a)(IV) amended, (HB 19-1291), ch. 188, p. 2094, § 5, effective August 2.

Editor's note: This section is similar to former § 10-17-114.5 as it existed prior to 1992.