Alabama Administrative Code › Title 482 - ALABAMA DEPARTMENT OF INSURANCE › Chapter 482-1-083 - GOVERNING RULES OF THE ALABAMA HEALTH MAINTENANCE ORGANIZATION GUARANTY ASSOCIATION › Section 482-1-083-.04 - Assessments

Current through Register Vol. 42, No. 9, June 28, 2024
(1) For the purpose
			 of providing the funds necessary to carry out the powers and duties of the
			 Association, the Board of Directors shall assess the member HMOs at such time
			 and for such amounts as the Board finds necessary. Assessments shall be due not
			 less than thirty (30) days after prior written notice to member HMOs and shall
			 accrue interest at six percent per annum on and after the due date. The Board
			 in its discretion may provide for installment payments of an assessment in a
			 manner deemed appropriate to meet the needs of the Association.
(2) There shall be two classes of
			 assessments, as follows:
(a) Class A
			 assessments shall be made for the purpose of meeting administrative costs,
			 costs of examinations of HMOs requested by the Board, and other general
			 expenses of the Association not related to a particular insolvent
			 HMO.
(b) Class B assessments shall
			 be made to the extent necessary to carry out the powers and duties of the
			 Association under Section
			 27-21A-12(i), the
			 Plan, and any other Insurance Departmental Regulations or Public Health
			 Departmental Regulations with regard to an insolvent HMO.
(c) The amount of any Class A Assessment
			 shall be determined by the Board and may be made on a non-pro rata basis. Such
			 assessment shall not exceed $2,000 per member HMO per calendar year. This
			 assessment for administrative expenses shall not be deductible from premium
			 taxes payable by member HMOs in excess of the amount deductible by life
			 insurers.
(d) Class B assessments
			 against member HMOs shall be in the proportion that the premiums received on
			 all business conducted in this state by each assessed member HMO for the
			 calendar year preceding the assessment bears to such premiums received on all
			 business conducted in this state by all assessed member HMOs for said
			 year.
(e) Assessments for funds to
			 meet the requirements of the Association with respect to an insolvent member
			 HMO shall be made when necessary to implement the purposes of the Association.
			 Computation of assessments shall be made with a reasonable degree of accuracy,
			 based upon premium information provided to the Association by the
			 Commissioner.
(f) The Association
			 may abate or defer, in whole or in part, the assessment of a member HMO if, in
			 the opinion of the Board, payment of the assessment would endanger the ability
			 of the member HMO to fulfill its contractual obligations to enrollees. In the
			 event an assessment against a member HMO is abated, or deferred in whole or in
			 part, the amount by which such assessment is abated or deferred may be assessed
			 against the other member HMOs in a manner consistent with the basis for
			 assessments set forth in this rule.
(g) The total of all assessments upon a
			 member HMO shall not in any one calendar year exceed one percent of such HMO's
			 premiums received on covered contracts in this state during the calendar year
			 preceding the assessment. If the maximum assessment, together with the other
			 assets of the Association, does not provide in any one year an amount
			 sufficient to carry out the responsibilities of the Association, the necessary
			 additional funds shall be assessed as soon thereafter as permitted by the
			 Plan.
(h) The Board may refund to
			 member HMOs, in proportion to the contribution of each HMO, the amount by which
			 the assets of the account exceed the amount the Board finds is necessary to
			 carry out during the coming year the obligations of the Association, including
			 assets accruing from net realized gains and income from investments. A
			 reasonable amount may be maintained in any account to provide funds for the
			 continued expenses of the Association and for future losses.
(i) The Association shall issue to each HMO
			 paying an assessment, other than a Class A assessment, a certificate of
			 contribution, in a form prescribed by the Commissioner, for the amount of the
			 assessment so paid. A certificate of contribution may be shown by the HMO in
			 its financial statement as an admitted asset and for such amount not to exceed
			 ten percent of admitted assets for a period of five years after the
			 contribution is made, if any, or until the HMO has fully deducted its
			 contribution from its premium tax liability in such form or in such amount as
			 the Commissioner may approve.
(j)
(1) A member HMO may offset against its
			 premium tax liability (or liabilities) to this states an assessment described
			 in this rule to the extent of twenty (20) percent of the amount of such
			 assessment for each of the five calendar years following the year in which such
			 assessment is paid.
(2) Any sums
			 which are acquired by refund, pursuant to this rule, from the Association by
			 member HMOs, and which theretofore have been offset against premium taxes as
			 provided in Paragraph (1) above, shall be paid by such HMOs to this state in
			 such manner as the Commissioner may require. The Association shall notify the
			 Commissioner that such refunds have been made.
Author:
Commissioner of Insurance