(a)

1. (1) All risk-based provider organizations (RBPOs) shall be responsible for meeting the following solvency standards under this section:

   1. (A) At the time of initial licensure;
   2. (B) In the evaluation of their application; and
   3. (C) Continuously thereafter.

2. (2) All RBPOs acting as a carrier under Arkansas Code § 20-77-2703(4) shall be subject to this section in addition to any other provision in the Arkansas Insurance Code or rules applicable to its type of organization, unless excluded by:

   1. (A) This part;
   2. (B) The Medicaid Provider-Led Organized Care Act, Arkansas Code § 20-77-2701 et seq.; or
   3. (C) Medicaid preemption.

(b) Solvency standards. All RBPOs participating in the Organized Care Act Program shall:

1. (1)

   1. (A) Meet the reserve or capital requirements under Arkansas Code § 20-77-2706(f)(4) and any additional amounts needed to satisfy risk-based capital requirements under Arkansas Code § 23-63-1501 et seq. (hereafter, HMO-RBC).
   2. (B) The reserve requirements in Arkansas Code § 20-77-2706(f)(4) shall refer to the organization’s capital or capital and surplus under statutory accounting principles (SAP).
   3. (C) The Insurance Commissioner may adjust the reserve requirements of the RBPO from initial licensure, on a prospective basis, related to the timing of the RBPO assumption levels of partial to full risk in its business operations.
   4. (D) In addition, the commissioner may consider the extent to which the RBPO has reinsurance or stop loss coverage, or agreements with a licensed insurer or health maintenance organization (HMO), to cede risk, as a circumstance to reduce or modify reserve or capital requirements under this section.
   5. (E) The commissioner shall review and approve all such risk sharing agreements, including any major modifications thereof;
2. (2) Comply with SAP reporting and file quarterly and annual financial statements with the State Insurance Department under SAP in the same manner as is required of a health maintenance organization regulated by the department under Arkansas Code § 23-76-113;
3. (3) Comply with HMO-RBC requirements and reporting;
4. (4) Comply with Arkansas Code § 23-63-601 et seq., referring to assets and liabilities;
5. (5) Comply with Arkansas Code § 23-68-101 et seq., referring to rehabilitation and liquidation;
6. (6) Comply with Arkansas Code § 23-69-134, referring to home office and records and the penalty for unlawful removal of records;
7. (7) Comply with Arkansas Code § 23-76-122, related to examinations, in the same manner as a health maintenance organization;
8. (8) Comply with Arkansas Code §§ 23-60-101 – 23-60-108 and 23-60-110 referring to the scope of the Arkansas Insurance Code;
9. (9) Comply with Arkansas Code §§ 23-61-101, 23-61-201, and 23-61-301 referring to the Insurance Commissioner;
10. (10) Comply with Arkansas Code §§ 23-63-102 – 23-63-104, § 23-63-201 et seq., general provisions, and Arkansas Code § 23-63-301 et seq., referring to service of process, a registered agent as process agent, serving legal process, and time to plead;
11. (11) Comply with the annual independent audit under Arkansas Code § 23-63-216(a)(5) and actuarial requirements under Arkansas Code § 23-63-216(e)(1) and (2);
12. (12) Comply with the custody of assets requirements under Arkansas Code § 23-69-134; and
13. (13) Comply with the transfer of ownership requirements or acquisition provisions under Arkansas Code § 23-69-142.