1. A. Following the close of each fiscal year, the pool administrator shall determine the net premium, being premiums less administrative expense allowances, the pool expenses and claim expense losses for the year, taking into account investment income and other appropriate gains and losses. The assessment for each insurer shall be determined by multiplying the total cost of pool operation by a fraction, the numerator of which equals that insurer's premium and subscriber contract charges or their equivalent for health insurance written in the state during the preceding calendar year and the denominator of which equals the total of all premiums and subscriber contract charges written in the state; provided that premium income shall include receipts of medicaid managed care premiums but shall not include any payments by the secretary of human services pursuant to a contract issued under Section 1876 of the Social Security Act, as amended. The board may adopt other or additional methods of adjusting the formula to achieve equity of assessments among pool members, including assessment of health insurers and reinsurers based upon the number of persons they cover through primary, excess and stop-loss insurance in the state.
2. B. If assessments exceed actual losses and administrative expenses of the pool, the excess shall be held at interest and used by the board to offset future losses or to reduce pool premiums. As used in this subsection, "future losses" includes reserves for incurred but not reported claims.
3. C. The proportion of participation of each member in the pool shall be determined annually by the board based on annual statements and other reports deemed necessary by the board and filed with it by the member. Any deficit incurred by the pool shall be recouped by assessments apportioned among the members of the pool pursuant to the assessment formula provided by Subsection A of this section.
4. D. The board may abate or defer, in whole or in part, the assessment of a member of the pool if, in the opinion of the board, payment of the assessment would endanger the ability of the member to fulfill its contractual obligation. In the event an assessment against a member of the pool is abated or deferred in whole or in part, the amount by which such assessment is abated or deferred may be assessed against the other members in a manner consistent with the basis for assessments set forth in Subsection A of this section. The member receiving the abatement or deferment shall remain liable to the pool for the deficiency for four years.

History: 1978 Comp., § 59A-54-10, enacted by Laws 1987, ch. 154, § 10; 1991, ch. 200, § 7; 1994, ch. 58, § 1; 2001, ch. 352, § 6; 2003, ch. 395, § 3; 2005, ch. 301, § 5; 2005, ch. 305, § 5; 2007, ch. 361, § 9; 2018, ch. 57, § 28.

ANNOTATIONS

Cross references. — For Section 1876 of the Social Security Act, see 42 U.S.C. § 1395mm.

The 2018 amendment, effective January 1, 2020, revised the provision related to calculating the assessments apportioned among the members of the medical insurance pool; in Subsection A, after "the secretary of", deleted "health and"; in Subsection C, after "Subsection A of this section", deleted "provided that the assessment for any pool member shall be allowed as a fifty percent credit on the premium tax return for that member and a seventy-five percent credit on the premium tax return for that member for the assessments attributable to pool policy holders that receive premiums, in whole or in part, through the federal Ryan White CARE Act, the Ted R. Montoya hemophilia program at the university of New Mexico health sciences center, the children’s medical services bureau of the public health division of the department of health or other program receiving state funding or assistance".

Temporary provisions. — Laws 2018, ch. 57, § 30 provided that:

A. On January 1, 2020, all personnel directly involved with the audit and collection of the taxes imposed pursuant to the New Mexico Insurance Code prior to the effective date of this act, functions, appropriations, money, records, furniture, equipment and other property of, or attributable to, the financial audit bureau of the office of superintendent of insurance shall be transferred to the taxation and revenue department.

B. On January 1, 2020, no contractual obligations of the office of superintendent of insurance shall be binding on the taxation and revenue department.

The 2007 amendment, effective June 15, 2007, amended Subsection C to increase from thirty to fifty percent the credit for the assessment on pool members and increase from fifty to seventy-five percent the credit for assessments attributable to pool policy holders that receive premiums through the Ryan White CARE Act and the Ted R. Montoya hemophilia program, the children’s medical services bureau or other programs receiving state funding or assistance.

Applicability. — Laws 2007, ch. 361, § 10 provided that Laws 2007, ch. 361, § 9 applied to assessments made pursuant to the Medical Insurance Pool Act beginning on or after July 1, 2007.

The 2005 amendment, effective July 1, 2005, provided in Subsection C that the assessment for any pool member shall be allowed as a fifty-percent credit on the premium tax return for a member on a the low-income premium schedule pursuant to Section 59A-54-19(B) NMSA 1978. Laws 2005, ch. 301, § 5 enacted identical amendments to this section. The section was set out as amended by Laws 2005, ch. 305, § 3. See 12-1-8 NMSA 1978.

The 2003 amendment, effective June 20, 2003, added "including assessment of health insurers and reinsurers based upon the number of persons they cover through primary, excess and stop-loss insurance in the state" at the end of Subsection A.

The 2001 amendment, effective June 15, 2001, inserted "shall include receipts of medicaid managed care premiums but" in the second sentence of Subsection A.

The 1994 amendment, effective May 17, 1994, in the proviso clause in the second sentence in Subsection C, deleted "if" preceding "the assessment" and deleted "exceed seventy-five thousand dollars ($75,000) in any year, the excess over that amount" following "pool member".

The 1991 amendment, effective June 14, 1991, inserted "or their equivalent" near the middle of the second sentence in Subsection A.