Date of Adoption: August 28, 2001.
Purpose: Chapter 179, Laws of 2001, requires health care service contractors and health maintenance organizations to submit and file certain information with the insurance commissioner. This rule will set forth the instructions, methods and forms by which this information will be filed with the insurance commissioner.
Statutory Authority for Adoption: RCW 48.02.060, 48.44.050, 48.46.200, and section 16, chapter 179, Laws of 2001 (SHB 1792).
Under RCW 34.05.350 the agency for good cause finds that immediate adoption, amendment, or repeal of a rule is necessary for the preservation of the public health, safety, or general welfare, and that observing the time requirements of notice and opportunity to comment upon adoption of a permanent rule would be contrary to the public interest.
Reasons for this Finding: Chapter 179, Laws of 2001, contained an emergency clause and therefore was effective immediately. This law requires that certain information be submitted and filed with the insurance commissioner. This rule will set forth the forms and instructions for making these filings. The deadline for filing some of this information with the insurance commissioner is September of 2001. There is insufficient time to adopt a permanent rule setting forth the instructions and forms for making these filings before the deadline. The process to permanently adopt these changes will begin at the time of this emergency adoption.
Number of Sections Adopted in Order to Comply with Federal Statute: New 0, Amended 0, Repealed 0; Federal Rules or Standards: New 0, Amended 0, Repealed 0; or Recently Enacted State Statutes: New 21, Amended 0, Repealed 0.
Number of Sections Adopted at Request of a Nongovernmental Entity: New 0, Amended 0, Repealed 0.
Number of Sections Adopted on the Agency's Own Initiative: New 0, Amended 0, Repealed 0.
Number of Sections Adopted in Order to Clarify, Streamline, or Reform Agency Procedures: New 0, Amended 0, Repealed 0.
Number of Sections Adopted Using Negotiated Rule Making:
Pilot Rule Making:
or Other Alternative Rule Making:
Effective Date of Rule: Immediately.
August 28, 2001
HEALTH CARE SERVICE CONTRACTOR AND HEALTH MAINTENANCE HOLDING COMPANY REGULATION
(2) Two complete copies of Form A, and one copy of Forms B, C, and D, and E, including exhibits and all other papers and documents filed as a part thereof, shall be filed with the commissioner by:
(a) Personal delivery to: Insurance Commissioner of the State of Washington, Lacey Financial Plaza Building, Suite 102, 420 Golf Club Road, Lacey, WA 98503; or
(b) Mailed to: Insurance Commissioner of the State of Washington, Post Office Box 40259, Olympia, Washington 98504-0259.
At least one of the copies shall be manually signed in the manner prescribed on the form. Unsigned copies shall be conformed. If the signature of any person is affixed pursuant to a power of attorney or other similar authority, a copy of such power of attorney or other authority shall also be filed with the statement.
(3) Statements should be prepared on paper 8 1/2" x 11" in size and preferably bound at the top or the top left-hand corner. Exhibits and financial statements, unless specifically prepared for the filing, may be submitted in their original size. All copies of any statement, financial statements, or exhibits shall be clear, easily readable, and suitable for photocopying. Debits in credit categories and credits in debit categories shall be designated so as to be clearly distinguishable as such on photocopies. Statements shall be in the English language and monetary values shall be stated in United States currency. If any exhibit or other paper or document filed with the statement is in a foreign language, it shall be accompanied by a translation into the English language and any monetary value shown in a foreign currency normally shall be converted into United States currency.
(2) Where an item requires a summary or outline of the provisions of any document, only a brief statement shall be made as to the pertinent provisions of the document. In addition to such statement, the summary or outline may incorporate by reference particular parts of any exhibit or document currently on file with the commissioner which was filed within three years and may be qualified in its entirety by such reference.
(a) The person filing shall give such information on the subject as it possesses or can acquire without unreasonable effort or expense, together with the sources thereof; and
(b) The person filing shall include a statement either showing that unreasonable effort or expense would be involved or indicating the absence of any affiliation with the person within whose knowledge the information rests and stating the result of a request made to such person for the information.
(2) If it is impractical to furnish any required information, document, or report at the time it is required to be filed, there may be filed with the commissioner a separate document:
(a) Identifying the information, document, or report in question;
(b) Stating why the filing thereof at the time required is impractical; and
(c) Requesting an extension of time for filing the information, document, or report to a specified date. The request for extension shall be deemed granted unless the commissioner within sixty days after receipt thereof enters an order denying the request.
(2) "Executive officer" means chief executive officer, chief operating officer, chief financial officer, treasurer, secretary, controller, and any other individual performing functions corresponding to those performed by the foregoing officers under whatever title.
(3) "Ultimate controlling person" means that person who is not controlled by any other person.
(4) Unless the context otherwise requires, other terms found in these regulations and in section 1, chapter 179, Laws of 2001, are used as defined in that section 1, chapter 179, Laws of 2001. Other nomenclature or terminology is according to Title 48 RCW, or industry usage if not defined by Title 48 RCW.
(2) The first Form B filing following adoption of chapter 179, Laws of 2001, shall be for the calendar year 2000 and made on or before September 4, 2001. Thereafter, the Form B must be filed within fifteen days after the health carrier becomes subject to registration, and annually on or before May 15th of each year for the previous calendar year.
(2) For the time period from January 1, 2001, to August 31, 2001, if there has been a material change to the information provided in the first Form B filed after the adoption of chapter 179, Laws of 2001, an amendment to the Form B shall be filed on or before September 28, 2001.
(3) Amendments shall be filed in the Form B format with only those items which are being amended reported. Each such amendment shall include at the top of the cover page "Amendment No. (insert number) to Form B for (insert year)" and shall indicate the date of the change and not the date of the original filings.
(a) The statement or report contains substantially similar information required to be furnished on Form B; and
(b) The filing health carrier is the principal health carrier in the health carrier holding company system.
(2) The question of whether the filing health carrier is the principal health carrier in the health carrier holding company system is a question of fact and a health carrier filing a registration statement or report in lieu of Form B on behalf of an affiliated health carrier, shall set forth a brief statement of facts which will substantiate the filing health carrier's claim that it, in fact, is the principal health carrier in the health carrier holding company system.
(3) Any health carrier may take advantage of the provisions of section 4 (7) or (8), chapter 179, Laws of 2001, without obtaining the prior approval of the commissioner. The commissioner, however, reserves the right to require individual filings if he or she deems such filings necessary in the interest of clarity, ease of administration, or the public good.
(1) The number of authorized, issued, and outstanding voting securities of the health carrier;
(2) With respect to the person whose control is denied and all affiliates of such person, the number and percentage of shares of the subject's voting securities which are held of record or known to be beneficially owned, and the number of such shares concerning which there is a right to acquire, directly or indirectly;
(3) All material relationships and bases for affiliation between the health carrier and the person whose control is denied and all affiliates of such person;
(4) A statement explaining why such person should not be considered to control the health carrier.
(a) The amount of the proposed dividend or distribution;
(b) The date established for payment of the dividend or distribution;
(c) A statement as to whether the dividend or distribution is to be in cash or other property and, if in property, a description thereof, its cost, and its fair market value together with an explanation of the basis for valuation;
(d) A copy of the calculations determining that the proposed dividend or distribution is extraordinary. The work paper shall include the following information:
(i) The amounts, dates, and form of payment of all dividends or distributions (including regular dividends but excluding distributions of the health carriers own securities) paid within the period of twelve consecutive months ending on the date fixed for payment of the proposed dividend or distribution for which approval is sought and commencing on the day after the same day of the same month in the last preceding year;
(ii) The net worth of the health carrier as of the 31st day of December next preceding;
(iii) The net income of the health carrier for the twelve-month period ending the 31st day of December next preceding;
(iv) The net worth of the health carrier after payment of the dividend or distribution;
(v) The RBC level of the health carrier after payment of the dividend or distribution;
(e) A balance sheet and statement of income for the period intervening from the last annual statement filed with the commissioner and the end of the month preceding the month in which the request for dividend approval is submitted; and
(2) Each registered health carrier shall report to the commissioner all other dividends and other distributions to shareholders within five business days following the declaration thereof, and at least fifteen business days before payment, including the same information required by subsection (1)(a) and (d)(i) through (v) of this section.
(3) The reporting of either dividends or distributions, or both, shall be made under the form set forth in WAC 284-18A-960.