§ 33-20-13 — Management of corporations; general powers; requirements as to reserves, minimum subscriber's surpluses, and charges

(a) Health care corporations shall be governed and conducted as corporations and the necessary expenses of administering the affairs of the corporations may be paid from the payments collected from subscribers. (b) A health care corporation may in its discretion limit the benefits that it will furnish, may divide such benefits as it elects to furnish into classes or kinds, and may furnish different benefits with different kinds or classes of contracts. A health care corporation may also select the hospitals and other participating facilities with which it shall contract and may establish its own standards for approval of such facilities or classes of facilities as it shall determine appropriate, as well as levels of payment which may differ between participating and nonparticipating facilities and different classes of facilities, provided that the contracts shall be fair and reasonable and the standards and levels of payment shall be fair and reasonable and shall not be unfairly discriminatory against any persons or facilities or classes of persons or facilities. (c) A health care corporation shall establish and maintain at all times proper reserves subject to the approval of the Commissioner in accordance with such standards and requirements as the Commissioner may establish by rule or regulation after any notice and hearing required for unearned subscription fees, for unpaid claims, for unreported claims, and for other known liabilities. (d) A health care corporation shall at all times maintain a minimum subscriber's surplus of not less than $1 million or such higher amount as the Commissioner may require by rule or regulation after any required notice and hearing for the protection of the subscribers. (e) A health care corporation shall be required to charge a minimum of one-half of 1 percent of income at risk on all accounts as a contribution towards subscriber's surplus and such funds derived therefrom shall be contributed to such health care corporation's subscriber's surplus under such terms and conditions as the Commissioner may reasonably require by order or regulation after any required notice and hearing, provided that, if the Commissioner determines after notice and hearing that the level of accumulated subscriber's surplus for a health care corporation is in excess of that reasonably required for the protection of the corporation's subscribers, the Commissioner shall have the authority to suspend the operation of this subsection until such time as the corporation's accumulated subscriber's surplus has returned to a level which is adequate for the protection of policyholders but not excessive.