215 ILCS 130/2004
2021 Illinois Compiled Statutes|Chapter 215 - INSURANCE|215 ILCS 130/ - Limited Health Service Organization Act.|Article 2 - Certificate Of Authority; General Corporate And Financial Requirements

 (from Ch. 73, par. 1502-4)Sec. 2004.     Required minimum net worth; impairment.(a) A limited health service organization issued a certificate of  authority shall have and at all times maintain net worth of not less than  the greater of:(1) $50,000; or(2) 2% of the organization's annual gross premium     income, up to a maximum of $500,000.(b) A limited health service organization that has annual uncovered  expenses in excess of $50,000, as reported on the most recent annual  financial statement filed with the Director, shall maintain additional net  worth equal to 25% of such uncovered expenses in excess of $50,000 in  addition to the net worth required by subsection (a), subject to the maximum  net worth set forth in item (2) of subsection (a).(c) A limited health service organization that has been approved by  the Director to offer a POS contract shall have and at all times maintain  net worth of not less than the greater of:(1) $100,000 if the LHSO's expenditures for     out-of-plan covered services do not exceed 10% of its total limited health expenditure in any calendar quarter; or(2) $100,000 plus an additional $10,000 for each     percentage point that the LHSO's expenditures for out-of-plan covered services exceeds 10% of its total limited health service expenditure in any calendar quarter up to $200,000; or(3) the amount set forth in item (2) of subsection     (a).(d) A deficiency in meeting amounts required in subsection (a), (b), or (c)  shall require (1) filing with the Director a plan of correction of the  deficiency, acceptable to the Director and (2) correction of the deficiency  within a reasonable time, not to exceed 60 days unless an extension of  time, not to exceed 60 additional days, is granted by the Director.  Such a  deficiency will be deemed an impairment, and failure to correct the  deficiency in the prescribed time shall be grounds for suspension or  revocation pursuant to subsection (h) of Section 4005 of this Act.(e) Unless allowed by the Director, no limited health service  organization, officer, director, trustee, producer or employee of such  organization may renew, issue, or deliver, or cause to be renewed, issued or  delivered, any evidence of coverage in this State, for which a premium is  charged or collected, when the organization writing such coverage is  insolvent or impaired, and the fact of such insolvency or impairment is  known to the organization, officer, director, producer or employee of such  organization.  An organization is impaired when a deficiency exists in  meeting the amounts required in subsection (a), (b), or (c) of this Section.  However, the existence of an impairment does not prevent the issuance or  renewal of any evidence of coverage when the enrollee exercises an option  granted under the plan to obtain new, renewed or converted coverage.  Any organization, officer, director, producer or employee of such  organization violating this subsection shall be guilty of a Class A  misdemeanor.    (Source: P.A. 87-1079; 88-667, eff. 9-16-94.)