Annual and quarterly reports.

(1) Every health maintenance organization shall, annually within 3 months after the end of its fiscal year, or within an extension of time therefor as the office, for good cause, may grant, in a form prescribed by the commission, file a report with the office, verified by the oath of two officers of the organization or, if not a corporation, of two persons who are principal managing directors of the affairs of the organization, properly notarized, showing its condition on the last day of the immediately preceding reporting period. Such report shall include:

(a) A financial statement of the health maintenance organization filed by electronic means in a computer-readable form using a format acceptable to the office.

(b) A financial statement of the health maintenance organization filed on forms acceptable to the office.

(c) An audited financial statement of the health maintenance organization, including its balance sheet and a statement of operations for the preceding year certified by an independent certified public accountant, prepared in accordance with statutory accounting principles.

(d) The number of health maintenance contracts issued and outstanding and the number of health maintenance contracts terminated.

(e) The number and amount of damage claims for medical injury initiated against the health maintenance organization and any of the providers engaged by it during the reporting year, broken down into claims with and without formal legal process, and the disposition, if any, of each such claim.

(f) An actuarial certification that:

1. The health maintenance organization is actuarially sound, which certification shall consider the rates, benefits, and expenses of, and any other funds available for the payment of obligations of, the organization.

2. The rates being charged or to be charged are actuarially adequate to the end of the period for which rates have been guaranteed.

3. Incurred but not reported claims and claims reported but not fully paid have been adequately provided for.

4. The health maintenance organization has adequately provided for all obligations required by s. 641.35(3)(a).

(g) A report prepared by the certified public accountant and filed with the office describing material weaknesses in the health maintenance organization’s internal control structure as noted by the certified public accountant during the audit. The report must be filed with the annual audited financial report as required in paragraph (c). The health maintenance organization shall provide a description of remedial actions taken or proposed to correct material weaknesses, if the actions are not described in the independent certified public accountant’s report.

(h) Such other information relating to the performance of health maintenance organizations as is required by the commission or office.

(2) The office may require updates of the actuarial certification as to a particular health maintenance organization if the office has reasonable cause to believe that such reserves are understated to the extent of materially misstating the financial position of the health maintenance organization. Workpapers in support of the statement of the updated actuarial certification must be provided to the office upon request.

(3) Every health maintenance organization shall file quarterly, for the first three calendar quarters of each year, an unaudited financial statement of the organization as described in paragraphs (1)(a) and (b). The statement for the quarter ending March 31 shall be filed on or before May 15, the statement for the quarter ending June 30 shall be filed on or before August 15, and the statement for the quarter ending September 30 shall be filed on or before November 15. The quarterly report shall be verified by the oath of two officers of the organization, properly notarized.

(4) Any health maintenance organization that neglects to file an annual report or quarterly report in the form and within the time required by this section shall forfeit up to $1,000 for each day for the first 10 days during which the neglect continues and shall forfeit up to $2,000 for each day after the first 10 days during which the neglect continues; and, upon notice by the office to that effect, the organization’s authority to enroll new subscribers or to do business in this state shall cease while such default continues. The office shall deposit all sums collected by it under this section to the credit of the Insurance Regulatory Trust Fund. The office shall not collect more than $100,000 for each report.

(5) Each authorized health maintenance organization shall retain an independent certified public accountant, referred to in this section as “CPA,” who agrees by written contract with the health maintenance organization to comply with the provisions of this part.

(a) The CPA shall provide to the HMO audited financial statements consistent with this part.

(b) Any determination by the CPA that the health maintenance organization does not meet minimum surplus requirements as set forth in this part shall be stated by the CPA, in writing, in the audited financial statement.

(c) The completed work papers and any written communications between the CPA firm and the health maintenance organization relating to the audit of the health maintenance organization shall be made available for review on a visual-inspection-only basis by the office at the offices of the health maintenance organization, at the office, or at any other reasonable place as mutually agreed between the office and the health maintenance organization. The CPA must retain for review the work papers and written communications for a period of not less than 6 years.

(d) The CPA shall provide to the office a written report describing material weaknesses in the health maintenance organization’s internal control structure as noted during the audit.

(6) To facilitate uniformity in financial statements and to facilitate office analysis, the commission may by rule adopt the form for financial statements of a health maintenance organization, including supplements as approved by the National Association of Insurance Commissioners in 1995, and may adopt subsequent amendments thereto if the methodology remains substantially consistent, and may by rule require each health maintenance organization to submit to the office all or part of the information contained in the annual statement in a computer-readable form compatible with the electronic data processing system specified by the office.

(7) In addition to information called for and furnished in connection with its annual or quarterly statements, the health maintenance organization shall furnish to the office as soon as reasonably possible such information as to its material transactions which, in the office’s opinion, may have a material adverse effect on the health maintenance organization’s financial condition, as the office requests in writing. All such information furnished pursuant to the office’s request must be verified by the oath of two executive officers of the health maintenance organization.

(8) Each health maintenance organization shall file one copy of its annual statement convention blank in electronic form, along with such additional filings as prescribed by the commission for the preceding calendar year or quarter, with the National Association of Insurance Commissioners. Each health maintenance organization shall pay fees assessed by the National Association of Insurance Commissioners to cover costs associated with the filing and analysis of the documents by the National Association of Insurance Commissioners.