PARRIS N. GLENDENING, Governor

Ch. 57

On or before the last day of February of each year, the Board shall determine and
report to the Commissioner the net loss of the Pool for the previous calendar year,
including administrative expenses and incurred losses for the year, taking into account
investment income and other appropriate gains and losses.

(b) Recoupment from reinsuring carriers.

Any net loss for the year shall be recouped by assessments imposed on reinsuring

carriers.

(c) Assessment formula.

(1) As part of the plan of operation, the Board shall establish a formula to
make assessments against reinsuring carriers.

(2) The assessment formula shall be based on:

(i) each reinsuring carrier's share of the total premiums earned in the
preceding calendar year from health benefit plans that are delivered or issued for delivery
in the State by reinsuring carriers; and

(ii) each reinsuring carrier's share of the premiums earned in the
preceding calendar year from newly issued health benefit plans that are delivered or
issued for delivery during that calendar year in the State by reinsuring carriers.

(3) The assessment formula may not result in an assessment share for a
reinsuring carrier that is less than 50% nor more than 150% of an amount that is based on
the proportion of the reinsuring carrier's total premiums earned in the preceding
calendar year from health benefit plans that are delivered or issued for delivery in the
State to total premiums earned by all reinsuring carriers in the preceding calendar year
from health benefit plans that are delivered or issued for delivery in the State.

(4) As appropriate and with the approval of the Commissioner, the Board
may change the assessment formula established in accordance with this subsection.

(5) The Board may provide for assessment shares attributable to premiums
from all health benefit plans and to premiums from newly issued health benefit plans to
vary during a transition period.

(6) Subject to the approval of the Commissioner, the Board shall make an
adjustment to the assessment formula for reinsuring carriers that are approved health
maintenance organizations and that are federally qualified under the Health
Maintenance Organization Act of 1973 to the extent that restrictions are placed on the
health maintenance organizations that are not imposed on other carriers.

(7) Premiums and benefits paid by a reinsuring carrier that are less than an
amount determined by the Board to justify the cost of collection may not be considered in
determining assessments.

(d) Estimate of assessments needed.

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