Hospital and Medical Services Corporation Surplus Reviews
District law requires the Department of Insurance, Securities and Banking to review the surplus of any non-profit corporation organized in the District (or under an act of Congress) that offers a hospital service plan or medical service plan. Currently, there is only one non-profit corporation subject to such reviews: Group Hospitalization and Medical Services, Inc. or GHMSI, a subsidiary of CareFirst, Inc., doing business in the District as CareFirst BlueCross BlueShield (CareFirst).
CareFirst must file a financial report with DISB by June 1 of each year which details the company’s surplus, describes the appropriate level of surplus necessary for the company to meet the National Association of Insurance Commissioners’ Risk Based Capital Requirements for health insurers, and examines whether the company’s surplus should be considered excessive under District law. CareFirst’s most recent filings – and responses to those filings – are available here.
DISB also conducts periodic hearings about the portion of CareFirst’s surplus that is attributable to the District. The purpose of the hearings is to determine whether CareFirst’s surplus is unreasonably large and inconsistent with its obligations to engage in community health reinvestment. DISB currently is reviewing CareFirst’s surplus for the year ended December 31, 2011; more information is available here. Information on DISB’s review of CareFirst’s surplus for the year ended December 31, 2008 is available here.