(1) Each HMO will be required to make an evaluation of its statement of total revenues and expenses prior to each annual report filing to ensure that the net income before taxes is no less than 2% of total revenues. If the HMO fails to meet the 2% requirement then the HMO will be required to provide the Office, as a part of its annual report filing, a corrective action plan. The corrective action plan will be reviewed in conjunction with the subsequent quarterly filings which will include information which indicates the progress being made, and an explanation as to any negative variances that exist.
    (2) Any HMO whose performance over any four (4) quarterly reporting periods, on a cumulative basis, whose net income before taxes is less than 2% of total revenues may be required to file a corrective action plan. This plan will also be reviewed on a quarterly basis and subject to the same reporting requirements stated in subsection (1), above.
    (3) Any HMO whose net earnings before taxes is less than two (2) percent of total revenues, but not a loss, and whose statutory surplus is 200 percent of the required amount (after dividends declared or taken) may request, in writing, a waiver for filing the corrective action plan. A waiver shall be granted if all of the following criteria are met:
    (a) The HMO is eligible to request as described above;
    (b) The HMO was not operating under a corrective plan during the preceding fiscal year; and,
    (c) The HMO is in full compliance with Florida Statutes Chapter 641, and this rule chapter except for paragraph (1) of this section.
    (4) The Office shall approve a corrective action plan complying with Florida Statutes § 641.23(3), if the plan meets all of the following criteria in that the plan includes:
    (a) A statement of the fundamental problems causing the net income to be less than 2 percent of total revenues;
    (b) A description of how the problems will be solved and what operational changes will be made;
    (c) A specific reasonable time schedule for implementation;
    (d) Projections of net income through the fiscal year in which net income is projected to exceed 2 percent of total revenue; and,
    (e) A pro forma projecting the anticipated program. Pro forma projections must be submitted electronically on Form OIR-A2-2212, Pro Forma Projections, effective 09/18, hereby incorporated by reference and available at http://www.flrules.org/Gateway/reference.asp?No=Ref-10585, via the Office’s Regulatory Electronic Filing System (REFS) at https://www.floir.com/iportal.
Rulemaking Authority 641.36 FS. Law Implemented 641.23(3) FS. History-New 5-28-92, Amended 8-15-94, Formerly 4-191.076, Amended 8-15-19.