Ala. Admin. Code r. 482-1-080-.04 - Definitions
The following are the meanings to be applied to the terms used in this chapter:
(1) Uncovered
Expenditures. The costs of health care services which are covered by a health
maintenance organization, for which an enrollee would also be liable in the
event of the organization's insolvency.
(2) Covered expenditures. Liabilities for the
costs of health care services not included in uncovered expenditures.
(3) Accounts payable. Amounts due to
creditors for the acquisition of goods and services on a credit basis from
trade and other vendors other than health care providers.
(4) Accrued inpatient claims. Hospital and
institutional care claims incurred which are not reported and/or booked as
payables, including Incurred But Not Reported Claims.
(5) Accrued Physician Claims. Claims incurred
for physicians and ancillary services (such as laboratory and x-ray) by
providers under an arrangement with the Health Maintenance
Organization.
(6) Accrued Referral
Claims. Claims incurred for health care provider consultants and for referrals
to providers outside a Health Maintenance Organization arrangement or for a
professional service contract which is usually paid on a fee-for-service basis
outside of the usual contractual provider arrangements of the HMO.
(7) Accrued Other Medical Expenses. Other
incurred medical expenses including emergency room, out-of-area services,
payroll and other miscellaneous medical expenses.
(8) Accrued Medical Incentive Pool. The
accrual for withheld funds from individual practice associations, other medical
groups or other such arrangements in which the Health Maintenance Organization
may return incentive funds to providers.
(9) Unearned Premium. Income received or
booked in advance of the applicable payment period for which a liability exists
to render services in the future.
(10) Loans and Loans Payable. The principal
amounts on loans signed by the Health Maintenance Organization or for which the
Health Maintenance Organization is liable and are amounts which include federal
loans.
(11) Capital. The par value
of stock; the stated amount of owner's direct equity in the Health Maintenance
Organization for a stock HMO. For a partnership HMO, capital shall mean the
amount of the partners' equity or ownership accounts.
(12) Restricted Funds. Funds of the Health
Maintenance Organization which have been dedicated to specific groups or
purposes by the Health Maintenance Organization's governing body. This includes
but is not limited to declared dividends and group trust accounts.
(13) Capital Account. Capital Account of an
HMO shall be defined as the total of paid-in stated capital which is the total
of the par value for stock having par value or the amount of the consideration
received by the corporation for all shares of the corporation without par value
which have been issued plus such amounts which have been transferred to stated
capital in a manner permitted by law for a corporation or the total of the
partners' equity account in the case of a partnership. The amount shall not be
less than $100,000 for any licensed HMO and shall be maintained without
diminution or impairment while the HMO is licensed. This is the legal capital
of the HMO.
(14) Impairment or
Insolvency. A Health Maintenance Organization shall be deemed to be impaired or
insolvent when the HMO does not possess admitted assets at least equal to its
liabilities and capital account. A Health Maintenance Organization shall be
rehabilitated, liquidated or conserved under any of the reasons as set forth in
Sections 27-21A-18 and
27-32-6, Code of Ala.
1975.
(15) Admitted
Assets. Those assets which are assets which are legally admissible assets of
life insurers and include assets as allowable only in the amounts and
qualifications as described in Sections
27-41-1,
et
seq., Code of
Ala. 1975. The valuation of admissible assets are as determined
according to Sections
27-37-1,
et
seq., Code of
Ala. 1975. Any investment limitations based on a life insurance
company's capital and surplus in these preceding sections shall instead be
based on the capital account and deposit requirement amounts found in Section
27-21A-12
Code of Ala.
1975.
(16) Uncovered
liabilities. Obligations resulting from unpaid uncovered expenditures, the
outstanding indebtedness of loans which are not specifically subordinated to
uncovered medical and health care expenses or guaranteed by the sponsoring
organization (guaranteeing person), and all other monetary obligations which
are not similarly subordinated or guaranteed by subordination agreements,
sponsoring organization guarantees, or other arrangements these covered
expenditures, subordinated indebtedness, guarantees, and other arrangements
must be acceptable to the Commissioner and must be accepted by written approval
of the Commissioner.
Author: Commissioner of Insurance
Notes
Statutory Authority: Code of Ala. 1975, §§ 27-21A-19, 27-2-17.
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