Texas Statutes
Subchapter L. Financial Regulation of Health Maintenance Organizations
Section 843.406. Hazardous Financial Condition

Sec. 843.406. HAZARDOUS FINANCIAL CONDITION. (a) If the financial condition of a health maintenance organization indicates that the continued operation of the health maintenance organization could be hazardous to its enrollees or creditors or the public, the commissioner may, after notice and opportunity for hearing:
(1) suspend or revoke the health maintenance organization's certificate of authority; or
(2) order the health maintenance organization to take action reasonably necessary to correct the condition, including by:
(A) reducing by reinsurance the total amount of present and potential liability for benefits;
(B) reducing the volume of new business being accepted;
(C) reducing expenses by specified methods;
(D) suspending or limiting for a period the writing of new business; or
(E) increasing the health maintenance organization's capital and surplus by contribution.
(b) In a manner consistent with the purposes of this section, the commissioner by rule may establish:
(1) uniform standards and criteria for early warning that the continued operation of a health maintenance organization could be hazardous to the health maintenance organization's enrollees or creditors or the public; and
(2) standards for evaluating the financial condition of a health maintenance organization.
Added by Acts 2001, 77th Leg., ch. 1419, Sec. 1, eff. June 1, 2003.

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