P.R. Laws tit. 26, § 9288
(a) Except as approved in accordance with subsection (d) of this section, each limited health service organization shall at all times have and maintain tangible net equity equal to the greater of fifty thousand dollars ($50,000); or two percent (2%) of the organization's annual gross premium income.
(b) For purposes of this section, “net equity” means the excess of total assets over total liabilities, excluding liabilities which have been subordinated in a manner acceptable to the Commissioner. “Tangible net equity” means equity reduced by the value assigned to intangible assets including, but not limited to, goodwill; going concern value; organizational expense; starting-up costs; long-term prepayments of deferred charges; nonreturnable deposits; and obligations of officers, directors, owners, or affiliates, except short-term obligations of affiliates for goods or services arising in the normal course of business that are payable on the same terms as equivalent transactions with nonaffiliates and that are not past due.
(c)
(1) At the time of approval, each limited health service organization shall deposit with the Commissioner assets eligible for deposit in the amount of six hundred thousand dollars ($600,000), as provided in § 802 of this title.
(2) The deposit shall be an admitted asset of the limited health service organization in the determination of tangible net equity.
(3) All income from deposits shall be an asset of the limited health service organization. A limited health service organization may withdraw a deposit or any part thereof after making a substitute deposit of equal amount and value. Any securities shall be approved by the Commissioner before being substituted.
(4) The deposit shall be used to protect the interests of subscribers and to assure continuation of limited healthcare services to subscribers of a limited health service organization that is in rehabilitation. If a limited health service organization is placed in receivership or liquidation, the deposit shall be an asset subject to provisions applicable to a liquidation process.
(d) Upon application by a limited health service organization, the Commissioner may waive some or all of the requirements of subsection (a) of this section for any period of time the Commissioner deems proper if the limited health service organization has a net equity of at least five million dollars ($5,000,000).
History —Aug. 29, 2011, No. 194, added as § 16.180 on Aug. 23, 2012, No. 203, § 2, eff. 90 days after Aug. 23, 2012.