CA Health & Safety Code Section 1374.68

A health care service plan that offers a point-of-service plan contract shall do all of the following:

(a)

Deposit with the director or, at the discretion of the director, with any organization or trustee acceptable to the director through which a custodial or controlled account is maintained, cash, securities, or any combination of these, which is acceptable to the director, that at all times have a fair market value equal to the greater of either one of the following:

(1)

Two hundred thousand dollars ($200,000).

(2)

One hundred twenty percent of the plan’s current monthly claims payable plus incurred but not reported balance for coverage out-of-network coverage or services provided under point-of-service contracts.

(b)

Track out-of-network point-of-service utilization separately from in-network utilization.

(c)

Record point-of-service utilization in a manner that will permit utilization and cost reporting as the director may require.

(d)

Demonstrate to the satisfaction of the director that the health care service plan has the fiscal, administrative, and marketing capacity to control its point-of-service plan contract enrollment, utilization, and costs so as not to jeopardize the financial viability or organizational and administrative capacity of the health care service plan.

(e)

Maintain the deposit required under subdivision (a) in a manner agreed to by the director, subject to subdivision (a) of Section 1377 and any regulations adopted thereunder.

(f)

Any deposit made pursuant to this section shall be a credit against any deposit required by subdivision (a) of Section 1377.