SOLVENCY STANDARDS.

SEC. 4706. SOLVENCY STANDARDS. Section 1903(m)(1) (42 U.S.C. 1396b(m)(1)) is amended— (1) in subparagraph (A)(ii), by inserting “, meets the requirements of subparagraph (C)(i) (if applicable),” after “provision is satisfactory to the State”, and (2) by adding at the end the following: “(C)(i) Subject to clause (ii), a provision meets the requirements of this subparagraph for an organization if the organization meets solvency standards established by the State for private health maintenance organizations or is licensed or certified by the State as a risk-bearing entity. “(ii) Clause (i) shall not apply to an organization if— “(I) the organization is not responsible for the provision (directly or through arrangements with providers of services) of inpatient hospital services and physicians’ services; “(II) the organization is a public entity; “(III) the solvency of the organization is guaranteed by the State; or “(IV) the organization is (or is controlled by) one or more Federally-qualified health centers and meets solvency standards established by the State for such an organization. For purposes of subclause (IV), the term ‘control’ means the possession, whether direct or indirect, of the power to direct or cause the direction of the management and policies of the organization through membership, board representation, or an ownership interest equal to or greater than 50.1 percent.”.