Kansas Statutes

Chapter 40: Insurance

Article 2d: Health Organization Risk-Based Capital Requirements

Statutes:

• 40-2d01: Risk-based capital requirements; definitions.
• 40-2d02: Risk-based capital report.
• 40-2d03: Determination of risk-based capital.
• 40-2d04: Risk-based capital report; adjustment.
• 40-2d05: Risk-based capital; company action level event; defined.
• 40-2d06: Risk-based capital; company action level event; submission of RBC plan.
• 40-2d07: Risk-based capital report; submission.
• 40-2d08: Risk-based capital plan; notification by commissioner.
• 40-2d09: Risk-based capital plan; notification of a regulatory action event.
• 40-2d10: Domestic health organization to file RBC plan in any state authorized to do business.
• 40-2d11: Regulatory action level event.
• 40-2d12: Regulatory action level event; commissioner's duties.
• 40-2d13: Corrective actions; submission of RBC plans, when.
• 40-2d14: Review of RBC plans; expenses.
• 40-2d15: Authorized control level event; defined.
• 40-2d16: Authorized control level event; commissioner's duties.
• 40-2d17: Mandatory control event; defined.
• 40-2d18: Mandatory control level event; commissioner's actions.
• 40-2d19: Hearing under Kansas administrative procedure act.
• 40-2d20: RBC reports, plans and corrective orders are confidential; not to be used for rate making.
• 40-2d21: Comparison of health organization's total adjusted capital to RBC levels, prohibited generally.
• 40-2d22: Provisions of act supplemental to other provisions of law.
• 40-2d23: Foreign health organization; RBC report.
• 40-2d24: Commissioner may require foreign health insurer to file RBC plan, when.
• 40-2d25: Mandatory control level event; foreign health organization; liquidation of property.
• 40-2d26: Notices by commissioner; effective, when.
• 40-2d27: Invalidity of act.
• 40-2d28: Regulatory action provisions; phase in.
• 40-2d29: Rules and regulations.
• 40-2d30: Health organization risk-based capital act; citation.

• 40-2d01: Risk-based capital requirements; definitions. As used in K.S.A. 40-2d01 through 40-2d30 and amendments thereto:

        (a)   "Adjusted RBC report" means an RBC report which has been adjusted by the commissioner in accordance with K.S.A. 40-2d04 and amendments thereto.

        (b)   "Corrective order" means an order issued by the commissioner specifying corrective actions which the commissioner has determined are required.

        (c)   "Domestic health organization" means any health organization which is licensed and organized in this state.

        (d)   "Foreign health organization" means any health organization not domiciled in this state which is licensed to do business in this state pursuant to articles 19a, 19c or 32 of chapter 40 of the Kansas Statutes Annotated, and amendments thereto.

        (e)   "NAIC" means the national association of insurance commissioners.

        (f)   "Health organization" means a health maintenance organization, limited health service organization, dental or vision plan, hospital, medical and dental indemnity or service corporation or other managed care organization licensed under articles 19a, 19c or 32 of chapter 40 of the Kansas Statutes Annotated, and amendments thereto. This definition shall not include an organization that is licensed as either a life and health insurer or a property and casualty insurer under articles 4, 5, 9, 10, 11, 12, 12a, 15 or 16 of chapter 40 of the Kansas Statutes Annotated, and amendments thereto, and that is otherwise subject to either the life or property and casualty RBC requirements in K.S.A. 40-2c01 et seq., and amendments thereto.

        (g)   "RBC" means risk-based capital.

        (h)   "RBC instructions" means the risk-based capital instructions for managed care organizations promulgated by the NAIC which are in effect on December 31, 1999, or any later version as adopted by the commissioner in rules and regulations.

        (i)   "RBC level" means a health organization's company action level RBC, regulatory action level RBC, authorized control level RBC, or mandatory control level RBC where:

        (1)   "Company action level RBC" means, with respect to any health organization, the product of 2.0 and its authorized control level RBC;

        (2)   "regulatory action level RBC" means the product of 1.5 and its authorized control level RBC;

        (3)   "authorized control level RBC" means the number determined under the risk-based capital formula in accordance with the RBC instructions; and

        (4)   "mandatory control level RBC" means the product of .70 and the authorized control level RBC.

        (j)   "RBC plan" means a comprehensive financial plan containing the elements specified in K.S.A. 40-2d05, and amendments thereto. If the commissioner rejects the RBC plan, and it is revised by the health organization, with or without the commissioner's recommendation, the plan shall be called the "revised RBC plan."

        (k)   "RBC report" means the report required by K.S.A. 40-2d02, 40-2d03 and 40-2d04 and amendments thereto.

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

        (1)   A health organization's capital and surplus as determined in accordance with the annual financial statements required to be filed under articles 19a, 19c or 32 of chapter 40 of the Kansas Statutes Annotated and amendments thereto; and

        (2)   such other items, if any, as the RBC instructions may provide.

        (m)   "Commissioner" means the commissioner of insurance.

        History:   L. 2000, ch. 147, § 2; July 1.

• 40-2d02: Risk-based capital report. (a) Except as provided in paragraph (b), every domestic health organization shall prepare and submit to the commissioner, on or before March 1, a report of its RBC levels as of the end of the calendar year just ended in a form and containing such information as is required by the RBC instructions. In addition, every domestic health organization shall file its RBC report:

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

        (2)   with the insurance commissioner in any state in which the health organization is authorized to do business, if such 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)   15 days from the receipt of notice to file its RBC report with that state; or

        (B)   the filing date otherwise specified in this subsection.

        (b)   The risk-based capital requirements of this section shall not apply to any health organization contracting with the Kansas department of social and rehabilitation services to provide services provided under title XIX and title XXI of the social security act or any other public benefits, provided the public benefit contracts represent at least 90% of the premium volume of the health organization.

        History:   L. 2000, ch. 147, § 3; July 1.

• 40-2d03: Determination of risk-based capital. (a) A health organization's RBC shall be determined in accordance with the formula set forth in the RBC instructions. The formula shall take into account and may adjust for the covariance between:

        (1)   Asset risk;

        (2)   credit risk;

        (3)   underwriting risk; and

        (4)   all other business risks and such other relevant risks as are set forth in the RBC instructions; determined in each case by applying the factors in the manner set forth in the RBC instructions.

        (b)   An excess of capital over the amount produced by the risk-based capital requirements contained in this act and the formulas, schedules and instructions referenced in this act is desirable in the business of insurance. Accordingly, each health organization should seek to maintain capital above the RBC levels required by this act. 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 act.

        History:   L. 2000, ch. 147, § 4; July 1.

• 40-2d04: Risk-based capital report; adjustment. 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 such health organization of the adjustment. The notice shall contain a statement of the reason for the adjustment. A RBC report as so adjusted is referred to as an adjusted RBC report.

        History:   L. 2000, ch. 147, § 5; July 1.

• 40-2d05: Risk-based capital; company action level event; defined. "Company action level event" means any of the following events:

        (a)   The filing of an RBC report by a health organization which indicates that a 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.

        (b)   The notification by the commissioner to the health organization of an adjusted RBC report that indicates the event described in subsection (a) if:

        (1)   The health organization does not challenge the adjusted RBC report pursuant to K.S.A. 40-2d19, and amendments thereto; or

        (2)   the commissioner has rejected such challenge after a hearing.

        History:   L. 2000, ch. 147, § 6; July 1.

• 40-2d06: Risk-based capital; company action level event; submission of RBC plan. In the event of a company action level event, the health organization shall prepare and submit to the commissioner an RBC plan which shall:

        (a)   Identify the conditions in the health organization's operation which contribute to the company action level event;

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

        (c)   provide projections of the health organization's financial results in the current year and at least the two succeeding years, both in the absence of the 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;

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

        (e)   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 in each case, if any.

        History:   L. 2000, ch. 147, § 7; July 1.

• 40-2d07: Risk-based capital report; submission. The RBC plan shall be submitted:

        (a)   Within 45 days of the company action level event; or

        (b)   within 45 days after notification to the health organization that the commissioner has rejected the health organization's challenge to an adjusted RBC report pursuant to K.S.A. 40-2d19 and amendments thereto.

        History:   L. 2000, ch. 147, § 8; July 1.

• 40-2d08: Risk-based capital plan; notification by commissioner. Within 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 state the reasons for the determination, and may state proposed revisions which, in the judgments of the commissioner, will render the RBC plan satisfactory. Upon notification from the commissioner, the health organization shall prepare a revised RBC plan and shall submit the revised RBC plan to the commissioner:

        (a)   Within 45 days after the notification from the commissioner; or

        (b)   within 45 days after a notification to the health organization that the commissioner has, pursuant to K.S.A. 40-2d19, and amendments thereto, rejected the health organization's challenge to the commissioner's original findings as authorized by this section.

        History:   L. 2000, ch. 147, § 9; July 1.

• 40-2d09: Risk-based capital plan; notification of a regulatory action event. 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, subject to the health organization's right to a hearing under K.S.A. 40-2d19, and amendments thereto, may specify in the notification that the notification constitutes a regulatory action level event.

        History:   L. 2000, ch. 147, § 10; July 1.

• 40-2d10: Domestic health organization to file RBC plan in any state authorized to do business. 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:

        (a)   Such state has an RBC provision substantially similar to K.S.A. 40-2d20, and amendments thereto; and

        (b)   the insurance commissioner of that state has notified the health organization of such insurance commissioner's 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:

        (1)   15 days after the receipt of notice to file a copy of its RBC plan or revised RBC plan with the state; or

        (2)   the date on which the final RBC plan or revised RBC plan is filed under K.S.A. 40-2d07 or 40-2d08, and amendments thereto.

        History:   L. 2000, ch. 147, § 11; July 1.

• 40-2d11: Regulatory action level event. "Regulatory action level event" means, with respect to any health organization, any of the following events:

        (a)   The filing of an RBC report by the health organization which 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;

        (b)   the notification by the commissioner to the health organization of an adjusted RBC report that indicates the event described in subsection (a) if:

        (1)   The health organization does not challenge the adjusted RBC report pursuant to K.S.A. 40-2d19, and amendments thereto; or

        (2)   the commissioner has rejected such challenge after a hearing; and

        (c)   the failure of the health organization to file an RBC report by the filing date, unless the health organization has provided an explanation for such failure which is satisfactory to the commissioner and has cured the failure within 10 days after the filing date;

        (d)   the failure of the health organization to submit an RBC plan to the commissioner within the time period set forth in K.S.A. 40-2d07, and amendments thereto;

        (e)   notification by the commissioner to the health organization that:

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

        (2) (A)   the health organization has not challenged the determination pursuant to K.S.A. 40-2d19, and amendments thereto; or

        (B)   the commissioner has rejected such challenge.

        (f)   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 such 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, if:

        (1)   The health organization has not challenged such determination pursuant to K.S.A. 40-2d19, and amendments thereto; or

        (2)   the commissioner has rejected such challenge after a hearing.

        History:   L. 2000, ch. 147, § 12; July 1.

• 40-2d12: Regulatory action level event; commissioner's duties. In the event of a regulatory action level event, the commissioner shall:

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

        (b)   perform such examination or analysis as the commissioner deems necessary of the assets, liabilities and operations of the health organization including a review of its RBC plan or revised RBC plan; and

        (c)   subsequent to the examination or analysis, issue a corrective order specifying such actions as the commissioner determines are required.

        History:   L. 2000, ch. 147, § 13; July 1.

• 40-2d13: Corrective actions; submission of RBC plans, when. In determining corrective actions, the commissioner may take into account such factors as are deemed relevant with respect to the health organization based upon the commissioner's 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:

        (a)   Within 45 days after the occurrence of the regulatory action level event;

        (b)   within 45 days after the notification to the health organization that the commissioner has rejected the health organization's challenge to an adjusted RBC report pursuant to K.S.A. 40-2d19, and amendments thereto; or

        (c)   within 45 days after notification to the health organization that the commissioner has rejected the health organization's challenge to a revised RBC plan pursuant to K.S.A. 40-2d19, and amendments thereto.

        History:   L. 2000, ch. 147, § 14; July 1.

• 40-2d14: Review of RBC plans; expenses. The commissioner may retain actuaries and investment experts and other consultants as may be 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 reasonable fees, costs and expenses relating to consultants shall be borne by the affected health organization or other party as directed by the commissioner.

        History:   L. 2000, ch. 147, § 15; July 1.

• 40-2d15: Authorized control level event; defined. "Authorized control level event" means any of the following events:

        (a)   The filing of an RBC report by the health organization which 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;

        (b)   the notification by the commissioner to the health organization of an adjusted RBC report that indicates the event described in subsection (a) if:

        (1)   The health organization does not challenge the adjusted RBC report pursuant to K.S.A. 40-2d19, and amendments thereto; or

        (2)   the commissioner has rejected such challenge after a hearing;

        (c)   the failure of the health organization to respond, in a manner satisfactory to the commissioner, to a corrective order if the health organization has not challenged the corrective order under K.S.A. 40-2d19, and amendments thereto; or

        (d)   if the commissioner has rejected the challenge to the corrective order or modified the corrective order pursuant to K.S.A. 40-2d19, and amendments thereto, 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.

        History:   L. 2000, ch. 147, § 16; July 1.

• 40-2d16: Authorized control level event; commissioner's duties. In the event of an authorized control level event with respect to a health organization, the commissioner:

        (a)   Shall take such actions as are required under K.S.A. 40-2d11 through 40-2d14, and amendments thereto, regarding a health organization with respect to which a regulatory action level event has occurred; or

        (b)   if the commissioner deems it to be in the best interests of the policyholders and creditors of the health organization and of the public, shall take such actions as are necessary to cause the health organization to be placed under regulatory control pursuant to K.S.A. 40-3605 et seq., and amendments thereto. In the event the commissioner takes such actions, the authorized control level event shall be deemed sufficient grounds for the commissioner to take action under K.S.A. 40-3605 et seq., and amendments thereto, and the commissioner shall have the rights, powers and duties with respect to the health organization as are set forth in K.S.A. 40-3605 et seq., and amendments thereto. In the event the commissioner takes actions under this subsection pursuant to an adjusted RBC report, the health organization shall be entitled to such protections as are afforded to health organizations under the provisions of K.S.A. 77-501 et seq., and amendments thereto, pertaining to summary proceedings.

        History:   L. 2000, ch. 147, § 17; July 1.

• 40-2d17: Mandatory control event; defined. "Mandatory control event" means any of the following events:

        (a)   The filing of an RBC report by the health organization which indicates that the health organization's total adjusted capital is less than its mandatory control level RBC;

        (b)   the notification by the commissioner to the health organization of an adjusted RBC report that indicates the event described in subsection (a) if:

        (1)   The health organization does not challenge the adjusted RBC report pursuant to K.S.A. 40-2d19 and amendments thereto; or

        (2)   the commissioner has rejected such challenge.

        History:   L. 2000, ch. 147, § 18; July 1.

• 40-2d18: Mandatory control level event; commissioner's actions. In the event of a mandatory control level event the commissioner shall take actions as are necessary to cause the health organization to be placed under regulatory control under K.S.A. 40-3605 et seq., and amendments thereto. In that event, the mandatory control level event shall be deemed sufficient grounds for the commissioner to take action under K.S.A. 40-3605 et seq., and amendments thereto, and the commissioner shall have the rights, powers and duties with respect to the health organization as are set forth in K.S.A. 40-3605 et seq., and amendments thereto. In the event the commissioner takes actions pursuant to an adjusted RBC report, the health organization shall be entitled to such protections as are afforded to health organizations under the provisions of K.S.A. 77-501 et seq. and amendments thereto, pertaining to summary proceedings. Notwithstanding any of the foregoing, the commissioner may forego action for up to 90 days after the mandatory control level event if there is a reasonable expectation that the mandatory control level event may be eliminated within the 90-day period.

        History:   L. 2000, ch. 147, § 19; July 1.

• 40-2d19: Hearing under Kansas administrative procedure act. (a) Upon notification to a health organization by the commissioner of an adjusted RBC report; or

        (b)   upon notification to an health organization by the commissioner that:

        (1)   The health organization's RBC plan or revised RBC plan is unsatisfactory; and

        (2)   such notification constitutes a regulatory action level event with respect to such health organization; or

        (c)   upon notification to any health organization by the commissioner that the health organization has failed to adhere to its RBC plan or revised RBC plan and that such failure has a substantial adverse effect on the ability of the health organization to eliminate the company action level event with respect to the health organization in accordance with its RBC plan or revised RBC plan; or

        (d)   upon notification to an health organization by the commissioner of a corrective order with respect to the health organization, the health organization shall have the right to a hearing under the Kansas administrative procedure act, at which the health organization may challenge any determination or action by the commissioner. The health organization shall notify the commissioner of its request for a hearing within five days after the notification by the commissioner under subsections (a), (b), (c) or (d). Upon receipt of the health organization's request for a hearing, the commissioner shall set a date for the hearing, which date shall be no less than 10 nor more than 30 days after receipt of the health organization's request. Such hearing shall be governed by K.S.A. 77-513 through 77-532 and amendments thereto.

        History:   L. 2000, ch. 147, § 20; July 1.

• 40-2d20: RBC reports, plans and corrective orders are confidential; not to be used for rate making. (a) All RBC reports, RBC plans and any corrective orders, including the working papers and the results of any analysis of a health organization performed under this act shall be kept confidential by the commissioner. This information shall not be made public or subject to subpoena, other than by the commissioner and then only for the purpose of enforcement actions taken by the commissioner pursuant to this act or any other provision of the insurance laws of this state.

        (b)   RBC instructions, RBC reports, adjusted RBC reports, RBC plans and revised RBC plans are intended solely for use by the commissioner in monitoring the solvency of health organizations and the need for possible corrective action with respect to health organizations and shall not be used by the commissioner for ratemaking nor considered or introduced as evidence in any rate proceeding nor used by the commissioner to calculate or derive any elements of an appropriate premium level or rate of return for any line of insurance which an health organization or any affiliate is authorized to write.

        (c) (1)   The commissioner may share or exchange any documents, materials or other information, including confidential and privileged documents referred to in subsection (a), received in the performance of the commissioner's duties under this act, with:

        (A)   The NAIC;

        (B)   other state, federal or international regulatory agencies; and

        (C)   other state, federal or international law enforcement authorities.

        (2) (A)   The sharing or exchanging of documents, materials or other information under this subsection shall be conditioned upon the recipient's authority and agreement to maintain the confidential and privileged status, if any, of the documents, materials or other information being shared or exchanged.

        (B)   No waiver of an existing privilege or claim of confidentiality in the documents, materials or information shall occur as a result of disclosure to the commissioner under this section or as a result of sharing as authorized by paragraph (1) of subsection (c).

        (3)   The commissioner of insurance is hereby authorized to adopt such rules and regulations establishing protocols governing the exchange of information as may be necessary to implement and carry out the provisions of this act.

        History:   L. 2000, ch. 147, § 21; July 1.

• 40-2d21: Comparison of health organization's total adjusted capital to RBC levels, prohibited generally. The comparison of a health organization's total adjusted capital to any of its RBC levels is a regulatory tool, and shall not be used to rank health organizations generally. Therefore, except as otherwise required under the provisions of this act, the making, publishing, disseminating, circulating or placing before the public, or causing, directly or indirectly to be made, published, disseminated, circulated or placed before the public, in a newspaper, magazine or other publication, or in the form of a notice, circular, pamphlet, letter or poster, or over any radio or television station, or in any other way, an advertisement, announcement or statement containing an assertion, representation or statement with regard to the RBC levels of any health organization, or of any component derived in the calculation, by any health organization, agent, broker or other person engaged in any manner in the insurance business is prohibited. Notwithstanding the foregoing, if any materially false statement with respect to the comparison regarding a health organization's total adjusted capital to any of its RBC levels or an inappropriate comparison of any other amount to the health organization's RBC levels is published in any written publication and the health organization is able to demonstrate to the commissioner with substantial proof the falsity or misrepresentative nature of such statement, the health organization may publish a rebuttal if the sole purpose of such publication is to rebut the materially false or improper statement.

        History:   L. 2000, ch. 147, § 22; July 1.

• 40-2d22: Provisions of act supplemental to other provisions of law. The provisions of this act are supplemental to any other provisions of the laws of this state, and shall not preclude nor limit any other powers or duties of the commissioner under such laws, including but not limited to K.S.A. 40-3605 et seq. and amendments thereto.

        History:   L. 2000, ch. 147, § 23; July 1.

• 40-2d23: Foreign health organization; RBC report. Any foreign health organization, upon the written request of the commissioner, shall submit to the commissioner an RBC report as of the end of the calendar year just ended the later of:

        (a)   The date an RBC report would be required to be filed by a domestic health organization under this act; or

        (b)   Fifteen days after the request is received by the foreign health organization.

        Any foreign health organization, at the written request of the commissioner, shall submit promptly to the commissioner a copy of any RBC plan that is filed with the insurance commissioner of any other state.

        History:   L. 2000, ch. 147, § 24; July 1.

• 40-2d24: Commissioner may require foreign health insurer to file RBC plan, when. In the event of a company action level event, regulatory action level event or authorized control level event with respect to any foreign health organization as determined under the RBC statute applicable in the state of domicile of the health organization or, if no RBC provision is in force in that state, under the provisions of this act, if the insurance commissioner of the state of domicile of the foreign health organization fails to require the foreign health organization to file an RBC plan in the manner specified under the RBC statute or, if there are no RBC provisions in force in the state, under K.S.A. 40-2d05, 40-2d06, 40-2d07, 40-2d08, 40-2d09 and 40-2d10, and amendments thereto, the commissioner may require the foreign health organization to file an RBC plan with the commissioner. In such event, the failure of the foreign health organization to file an RBC plan with the commissioner shall be grounds to order the health organization to cease and desist from writing new insurance business in this state.

        History:   L. 2000, ch. 147, § 25; July 1.

• 40-2d25: Mandatory control level event; foreign health organization; liquidation of property. In the event of a mandatory control level event with respect to any foreign health organization, if no domiciliary receiver has been appointed with respect to the foreign health organization under the rehabilitation and liquidation statute applicable in the state of domicile of the foreign health organization, the commissioner may make application to the district court as permitted under K.S.A. 40-3605 et seq. and amendments thereto with respect to the liquidation of property of foreign health organizations found in this state, and the occurrence of the mandatory control level event shall be considered adequate grounds for the application.

        History:   L. 2000, ch. 147, § 26; July 1.

• 40-2d26: Notices by commissioner; effective, when. All notices by the commissioner to a health organization which may result in regulatory action under this act shall be effective upon dispatch if transmitted by registered or certified mail, or in the case of any other transmission shall be effective upon the health organization's receipt of such notice.

        History:   L. 2000, ch. 147, § 27; July 1.

• 40-2d27: Invalidity of act. If any provision of this act, or the application of the act to any person or circumstance, is held invalid, such determination shall not affect the provisions or applications of this act which can be given effect without the invalid provision or application, and to that end the provisions of this act are severable.

        History:   L. 2000, ch. 147, § 28; July 1.

• 40-2d28: Regulatory action provisions; phase in. (a) Any regulatory action based upon any RBC report required to be filed by a health organization for such health organization's operations during calendar years 2000 and 2001 shall be subject to the following:

        (1)   In the event of a company action level event with respect to any health organization, the commissioner shall take no regulatory action under this act with respect to such health organization.

        (2)   In the event of a regulatory action level event with respect to any health organization under either subsection (a) or (b) of K.S.A. 40-2d11, and amendments thereto, the commissioner shall take such action with respect to such health organization under K.S.A. 40-2d05 through 40-2d10, inclusive, and amendments thereto, as the commissioner deems necessary.

        (3)   In the event of a regulatory action level event with respect to any health organization under any of subsections (c), (d), (e) or (f) of K.S.A. 40-2d11, and amendments thereto, or an authorized control level event, the commissioner shall take such action with respect to such health organization under K.S.A. 40-2d11 through 40-2d14, inclusive, and amendments thereto, as the commissioner deems necessary.

        (4)   In the event of a mandatory control level event with respect to any health organization, the commissioner shall take action with respect to such health organization as required under K.S.A. 40-2d15 and 40-2d16, and amendments thereto.

        (b)   The provisions of subsection (a) shall not limit the right of the commissioner to proceed as authorized by any other provision of chapter 40 of the Kansas Statutes Annotated, and amendments thereto or any rule and regulation adopted thereunder.

        History:   L. 2000, ch. 147, § 29; July 1.

• 40-2d29: Rules and regulations. The commissioner may adopt reasonable rules and regulations necessary for the implementation of this act.

        History:   L. 2000, ch. 147, § 30; July 1.

• 40-2d30: Health organization risk-based capital act; citation. K.S.A. 40-2d01 through 40-2d30, inclusive, and amendments thereto, shall constitute and may be cited as the health organization risk-based capital act.

        History:   L. 2000, ch. 147, § 31; July 1.