Common use of Risk Reserve Clause in Contracts

Risk Reserve. 1. The Contractor shall maintain a risk reserve approved by the Department in the event the Contractor becomes insolvent. The risk reserve accounts must be separate from any operating accounts. The Contractor must demonstrate that it has arrangements in place in the amount of one (1) month's total capitation revenue and one (1) month's average payment to Network Providers to cover expenses in the event it becomes insolvent. 2. The requirement in this Section may be met by one or more of following arrangements: a. Insolvency insurance; b. An irrevocable, unconditional and automatically renewable letter of credit for the benefit of the Department, which is in place for the entire term of this Agreement; c. A guarantee from an entity, acceptable to the Department, with sufficient financial strength and credit worthiness to assume the payment obligations of the Contractor in the event of a default in payment resulting from bankruptcy or insolvency; or d. Other arrangements, satisfactory to the Department, that are sufficient to ensure payment to Network Providers in the event of a default in payment resulting from bankruptcy or insolvency.

Risk Reserve. 1. The Contractor shall maintain a risk reserve approved by the Department in the event the Contractor becomes insolvent. The risk reserve accounts must be separate from any operating accounts. The Contractor must demonstrate that it has arrangements in place in the amount of one (1) month's total capitation revenue and one (1) month's average payment to Network Providers to cover expenses in the event it becomes insolvent. 2. The requirement in this Section may be met by one or more of the following arrangements: a. Insolvency insurance; b. An irrevocable, unconditional and automatically renewable letter of credit for the benefit of the Department, which is in place for the entire term of this Agreement; c. A guarantee from an entity, acceptable to the Department, with sufficient financial strength and credit worthiness to assume the payment obligations of the Contractor in the event of a default in payment resulting from bankruptcy or insolvency; or d. Other arrangements, satisfactory to the Department, that are sufficient to ensure payment to Network Providers in the event of a default in payment resulting from bankruptcy or insolvency.

Risk Reserve. 1. The Contractor shall maintain a risk reserve approved by the Department in the event the Contractor becomes insolvent. The risk reserve accounts must be separate from any operating accounts. The Contractor must demonstrate that it has arrangements in place in the amount of one (1) month's total capitation revenue and one (1) month's average payment to Network Providers to cover expenses in the event it becomes insolvent. 2. The requirement in this Section may be met by one or more of the following arrangements: a. Insolvency insurance; b. An irrevocable, unconditional and automatically renewable letter of credit for the benefit of the Department, which is in place for the entire term of this Agreement; c. A guarantee from an entity, acceptable to the Department, with sufficient financial strength and credit worthiness to assume the payment obligations of the Contractor in the event of a default in payment resulting from bankruptcy or insolvency; or d. Other arrangements, satisfactory to the Department, that are sufficient to ensure payment to Network Providers in the event of a default in payment resulting from bankruptcy or insolvency.