(215 ILCS 125/6-9) (from Ch. 111 1/2, par. 1418.9)
Sec. 6-9. Assessments.
(1) For the purpose of providing the funds necessary to carry out the powers and duties of the Association, the board of directors shall assess the member organizations, at such times and for such amounts as the board finds necessary. Assessments shall be due not less than 30 days after written notice to the member organizations and shall accrue interest from the due date at such adjusted rate as is established under Section 531.09 of the Illinois Insurance Code and such interest shall be compounded daily.
(2) There shall be 2 classes of assessments, as follows:
(a) Class A assessments shall be made for the purpose
of meeting administrative costs and other general expenses and examinations conducted under the authority of the Director under subsection (5) of Section 6-12.
(b) Class B assessments shall be made to the extent
necessary to carry out the powers and duties of the Association under Section 6-8 with regard to an impaired or insolvent domestic organization or insolvent foreign or alien organizations.
(3)(a) The amount of any Class A assessment shall be determined by the Board and may be made on a non-pro rata basis.
(b) Class B assessments against member organizations shall be in the proportion that the premiums received on health maintenance organization business in this State by each assessed member organization on covered health care plan certificates for the calendar year preceding the assessment bears to such premiums received on health maintenance organization business in this State for the calendar year preceding the assessment by all assessed member organizations.
(c) Assessments to meet the requirements of the Association with respect to an impaired or insolvent organization shall not be made until necessary to implement the purposes of this Article. Classification of assessments under subsection (2) and computations of assessments under this subsection shall be made with a reasonable degree of accuracy, recognizing that exact determinations may not always be possible.
(4)(a) The Association may abate or defer, in whole or in part, the assessment of a member organization if, in the opinion of the board, payment of the assessment would endanger the ability of the member organization to fulfill its contractual obligations.
(b) The total of all assessments upon a member organization may not in any one calendar year exceed 2% of such organization's premiums in this State during the calendar year preceding the assessment on the covered health care plan certificates.
(5) In the event an assessment against a member organization is abated, or deferred, in whole or in part, because of the limitations set forth in subsection (4) of this Section, the amount by which such assessment is abated or deferred, may be assessed against the other member organizations in a manner consistent with the basis for assessments set forth in this Section. If the maximum assessment, together with the other assets of the Association, does not provide in any one year an amount sufficient to carry out the responsibilities of the Association, the necessary additional funds may be assessed as soon thereafter as permitted by this Article.
(6) The board may, by an equitable method as established in the plan of operation, refund to member organizations, in proportion to the contribution of each organization, the amount by which the assets of the fund exceed the amount the board finds is necessary to carry out during the coming year the obligations of the Association, including assets accruing from net realized gains and income from investments. A reasonable amount may be retained in the fund to provide moneys for the continuing expenses of the Association and for future losses.
(7) An assessment is deemed to occur on the date upon which the board votes such assessment. The board may defer calling the payment of the assessment or may call for payment in one or more installments.
(8) It is proper for any member organization, in determining its rates to consider the amount reasonably necessary to meet its assessment obligations under this Article.
(9) The Association must issue to each organization paying a Class B assessment under this Article a certificate of contribution, in a form prescribed by the Director, for the amount of the assessment so paid. All outstanding certificates are of equal dignity and priority without reference to amounts or dates of issue. A certificate of contribution may be shown by the organization in its financial statement as an admitted asset in such form and for such amount, if any, and period of time as the Director may approve, provided the organization shall in any event at its option have the right to show a certificate of contribution as an asset at percentages of the original face amount for calendar years as follows:
100% for the calendar year after the year of issuance;
80% for the second calendar year after the year of issuance;
60% for the third calendar year after the year of issuance;
40% for the fourth calendar year after the year of issuance;
20% for the fifth calendar year after the year of issuance.
(10) The Association may request information of member organizations in order to aid in the exercise of its power under this Section and member organizations shall promptly comply with a request.
(Source: P.A. 96-1450, eff. 8-20-10.)
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Last modified: February 18, 2015