Subordinated debt

Subordinated debt means an obligation that is owed by an organization, that the creditor of the obligation, by law, agreement, or otherwise, has a lower repayment rank in the hierarchy of creditors than another creditor. The creditor would be entitled to repayment only after all higher ranking creditors' claims have been satisfied. A debt is fully subordinated if it has a lower repayment rank than all other classes of creditors.


42 CFR § 422.350

Scoping language

Basis and scope. This subpart is based on sections 1851 and 1855 of the Act which, in part,
(1) Authorize provider sponsored organizations, (PSOs), to contract as a MA plan;
(2) Require that a PSO meet certain qualifying requirements; and
(3) Provide for waiver of State licensure for PSOs under specified conditions.

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