26-48-202;

26-48-202;

(xii) "Total adjusted capital" means the sum of:

(A) A health organization's statutory capital and surplus as determined in accordance with the statutory accounting applicable to the annual financial statements required to be filed under W.S. 26-3-123 or 26-34-110; and

(B) Such other items, if any, as the RBC instructions may provide.

26-48-202. Risk-based capital reports.

(a) A domestic health organization shall, annually on or prior to March 1, prepare and submit to the commissioner a report of its RBC levels as of the end of the calendar year just ended, in a form and containing information as required by the RBC instructions. In addition, every domestic health organization shall file its RBC report:

(i) With the NAIC in accordance with the RBC instructions; and

(ii) With the insurance commissioner in any state in which the health organization is authorized to do business, if the insurance commissioner has notified the health organization of its request in writing, in which case the health organization shall file its RBC report not later than the later of:

(A) Fifteen (15) days from the receipt of notice to file its RBC report with that state; or

(B) March 1.

(b) A health organization's RBC shall be determined in accordance with the formula set forth in the RBC instructions and this article. The formula shall take the following into account, and may adjust for the covariance between the following which are determined in each case by applying the factors in the manner set forth in the RBC instructions:

(i) Asset risk;

(ii) Credit risk;

(iii) Underwriting risk; and

(iv) All other business risks and other relevant risks as are set forth in the RBC instructions.

(c) If a domestic health organization files an RBC report which in the judgment of the commissioner is inaccurate, the commissioner shall adjust the RBC report to correct the inaccuracy and shall notify the health organization of the adjustment. The notice shall contain a statement of the reasons for the adjustment. An RBC report as so adjusted is referred to as an "adjusted RBC report".

(d) An excess of capital over the amount produced by the risk-based capital requirements contained in this article and the formulas, schedules and instructions referenced in this article is desirable in the business of health insurance. Accordingly, health organizations should seek to maintain capital above the RBC levels required by this article. Additional capital is used and useful in the insurance business and helps to secure a health organization against various risks inherent in, or affecting, the business of insurance and not accounted for or only partially measured by the risk-based capital requirements contained in this article.

26-48-203. Company action level event.  (a) "Company action level event" means any of the following events:

(i) The filing of an RBC report by a health organization that indicates that the health organization's total adjusted capital is greater than or equal to its regulatory action level RBC but less than its company action level RBC;

(ii) If a health organization has total adjusted capital which is greater than or equal to its company action level RBC but less than the product of its authorized control level RBC and three (3) and triggers the trend test determined in accordance with the trend test calculation included in the health RBC instructions;

(iii) Notification by the commissioner to the health organization of an adjusted RBC report that indicates an event in paragraph (i) or (ii) of this subsection, provided the health organization does not challenge the adjusted RBC report under W.S. 26-48-207; or

(iv) If a health organization challenges an adjusted RBC report that indicates the event in paragraph (i) or (ii) of this subsection under W.S. 26-48-207, the notification by the commissioner to the health organization that the commissioner has, after a hearing, rejected the health organization's challenge.

(b) In the event of a company action level event, the health organization shall prepare and submit to the commissioner an RBC plan which shall:

(i) Identify the conditions that contribute to the company action level event;

(ii) Contain proposals of corrective actions that the health organization intends to take and that would be expected to result in the elimination of the company action level event;

(iii) Provide projections of the health organization's financial results in the current year and at least the two (2) succeeding years, both in the absence of proposed corrective actions and giving effect to the proposed corrective actions, including projections of statutory balance sheets, operating income, net income, capital and surplus and RBC levels. The projections for both new and renewal business may include separate projections for each major line of business and separately identify each significant income, expense and benefit component;

(iv) Identify the key assumptions impacting the health organization's projections and the sensitivity of the projections to the assumptions; and

(v) Identify the quality of, and problems associated with, the health organization's business, including but not limited to its assets, anticipated business growth and associated surplus strain, extraordinary exposure to risk, mix of business and use of reinsurance, if any, in each case.

(c) The RBC plan shall be submitted:

(i) Within forty-five (45) days of the company action level event; or

(ii) If the health organization challenges an adjusted RBC report under W.S. 26-48-207, within forty-five (45) days after notification to the health organization that the commissioner has, after a hearing, rejected the health organization's challenge.

(d) Within sixty (60) days after the submission by a health organization of an RBC plan to the commissioner, the commissioner shall notify the health organization whether the RBC plan shall be implemented or is, in the judgment of the commissioner, unsatisfactory. If the commissioner determines the RBC plan is unsatisfactory, the notification to the health organization shall set forth the reasons for the determination, and may set forth proposed revisions which will render the RBC plan satisfactory, in the judgment of the commissioner. Upon notification from the commissioner, the health organization shall prepare a revised RBC plan, which may incorporate by reference any revisions proposed by the commissioner, and shall submit the revised RBC plan to the commissioner:

(i) Within forty-five (45) days after the notification from the commissioner; or

(ii) If the health organization challenges the notification from the commissioner under W.S. 26-48-207, within forty-five (45) days after a notification to the health organization that the commissioner has, after a hearing, rejected the health organization's challenge.  (e) In the event of a notification by the commissioner to a health organization that the health organization's RBC plan or revised RBC plan is unsatisfactory, the commissioner may, subject to the health organization's right to a hearing under W.S. 26-48-207, specify in the notification that the notification constitutes a regulatory action level event.

(f) Every domestic health organization that files an RBC plan or revised RBC plan with the commissioner shall file a copy of the RBC plan or revised RBC plan with the insurance commissioner in any state in which the health organization is authorized to do business if:

(i) The state has an RBC provision substantially similar to W.S. 26-48-208(a); and

(ii) The insurance commissioner of that state has notified the health organization of its request for the filing in writing, in which case the health organization shall file a copy of the RBC plan or revised RBC plan in that state no later than the later of:

(A) Fifteen (15) days after the receipt of notice to file a copy of its RBC plan or revised RBC plan with the state; or

(B) The date on which the RBC plan or revised RBC plan is filed under subsections (c) and (d) of this section.

26-48-204. Regulatory action level event.

(a) "Regulatory action level event" means, with respect to a health organization, any of the following events:

(i) The filing of an RBC report by the health organization that indicates that the health organization's total adjusted capital is greater than or equal to its authorized control level RBC but less than its regulatory action level RBC;

(ii) Notification by the commissioner to a health organization of an adjusted RBC report that indicates the event in paragraph (i) of this subsection, provided the health organization does not challenge the adjusted RBC report under W.S. 26-48-207;

(iii) If the health organization challenges an adjusted RBC report that indicates the event in paragraph (i) of this subsection under W.S. 26-48-207, the notification by the commissioner to the health organization that the commissioner has, after a hearing, rejected the health organization's challenge;

(iv) The failure of the health organization to file an RBC report annually by March 1, unless the health organization has provided an explanation for the failure that is satisfactory to the commissioner and has cured the failure within ten (10) days after the filing date;

(v) The failure of the health organization to submit an RBC plan to the commissioner within the time period set forth in W.S. 26-48-203(c);

(vi) Notification by the commissioner to the health organization that:

(A) The RBC plan or revised RBC plan submitted by the health organization is, in the judgment of the commissioner, unsatisfactory; and

(B) Such notification constitutes a regulatory action level event with respect to the health organization, provided the health organization has not challenged the determination under W.S. 26-48-207.

(vii) If the health organization challenges a determination by the commissioner under paragraph (vi) of this subsection under W.S. 26-48-207, the notification by the commissioner to the health organization that the commissioner has, after a hearing, rejected the challenge;

(viii) Notification by the commissioner to the health organization that the health organization has failed to adhere to its RBC plan or revised RBC plan, but only if the failure has a substantial adverse effect on the ability of the health organization to eliminate the company action level event in accordance with its RBC plan or revised RBC plan and the commissioner has so stated in the notification, provided the health organization has not challenged the determination under W.S. 26-48-207; or

(ix) If the health organization challenges a determination by the commissioner under paragraph (viii) of this subsection under W.S. 26-48-207, the notification by the commissioner to the health organization that the commissioner has, after a hearing, rejected the challenge.

(b) In the event of a regulatory action level event the commissioner shall:

(i) Require the health organization to prepare and submit an RBC plan or, if applicable, a revised RBC plan;

(ii) Perform an examination or analysis as he deems necessary of the assets, liabilities and operations of the health organization including a review of its RBC plan or revised RBC plan; and

(iii) Subsequent to the examination or analysis, issue an order specifying such corrective actions as he shall determine are required.

(c) In determining corrective actions, the commissioner may take into account factors he deems relevant with respect to the health organization based upon his examination or analysis of the assets, liabilities and operations of the health organization, including, but not limited to, the results of any sensitivity tests undertaken pursuant to the RBC instructions. The RBC plan or revised RBC plan shall be submitted:

(i) Within forty-five (45) days after the occurrence of the regulatory action level event;

(ii) If the health organization challenges an adjusted RBC report under W.S. 26-48-207 and the challenge is not frivolous in the judgment of the commissioner, within forty- five (45) days after the notification to the health organization that the commissioner has, after a hearing, rejected the health organization's challenge; or

(iii) If the health organization challenges a revised RBC plan under W.S. 26-48-207 and the challenge is not frivolous in the judgment of the commissioner, within forty-five (45) days after the notification to the health organization that the commissioner has, after a hearing, rejected the health organization's challenge.

(d) The commissioner may retain actuaries and investment experts and other consultants necessary in the judgment of the commissioner to review the health organization's RBC plan or revised RBC plan, examine or analyze the assets, liabilities and operations of the health organization and formulate the corrective order with respect to the health organization. The fees, costs and expenses relating to consultants shall be borne by the affected health organization or other party as directed by the commissioner.

26-48-205. Authorized control level event.

(a) "Authorized control level event" means any of the following events:

(i) The filing of an RBC report by the health organization that indicates that the health organization's total adjusted capital is greater than or equal to its mandatory control level RBC but less than its authorized control level RBC;

(ii) The notification by the commissioner to the health organization of an adjusted RBC report that indicates the event in paragraph (i) of this subsection, provided the health organization does not challenge the adjusted RBC report under W.S. 26-48-207;

(iii) If the health organization challenges an adjusted RBC report that indicates the event in paragraph (i) of this subsection under W.S. 26-48-207, notification by the commissioner to the health organization that the commissioner has, after a hearing, rejected the health organization's challenge;

(iv) The failure of the health organization to respond, in a manner satisfactory to the commissioner, to a corrective order, provided the health organization has not challenged the corrective order under W.S. 26-48-207; or

(v) If the health organization has challenged a corrective order under W.S. 26-48-207 and the commissioner has, after a hearing, rejected the challenge or modified the corrective order, the failure of the health organization to respond, in a manner satisfactory to the commissioner, to the corrective order subsequent to rejection or modification by the commissioner.

(b) In the event of an authorized control level event with respect to a health organization, the commissioner shall:  (i) Take such actions as are required under W.S.