Initial Net Worth. An applicant may not obtain a certificate of authority unless the applicant has an initial net worth of at least: $1,500,000; or $1,000,000, based on evidence from the applicant's financial plan, as required by 42 CFR §422.384, demonstrating to the Commissioner's satisfaction that the applicant has available to it an administrative infrastructure that the Commissioner considers appropriate to reduce, control, or eliminate start-up administrative costs. Minimum Net Worth. After issuance of a certificate of authority, a provider-sponsored organization shall maintain at least the minimum net worth required under this section. Except as provided in §C of this regulation, each provider-sponsored organization shall maintain a minimum net worth equal to the greater of: $1,000,000; 2 percent of annual premium revenues as reported on the most recent annual financial statement filed with the Commissioner on the first $150,000,000 of premium and 1 percent of annual premium revenues on the premium in excess of $150,000,000; An amount equal to the sum of 3 months uncovered health care expenditures as reported on the most recent financial statement filed with the Commissioner; or Using the most recent annual financial statement filed with the Commissioner, an amount equal to the sum of: 8 percent of annual health care expenditures paid on a non-capitated basis to non-affiliated providers, 4 percent of annual health care expenditures paid on a capitated basis to non-affiliated providers plus annual health care expenditures paid on a non-capitated basis to affiliated providers, and Annual health care expenditures that are paid on a capitated basis to affiliated providers that are not included in the calculation of the net worth requirement under §§A and B(2)(d)(i) and (ii) of this regulation. Determining Net Worth. In determining net worth: A debt may not be considered fully subordinated unless the subordination clause is in a form acceptable to the Commissioner; Any interest obligation relating to the repayment of a subordinated debt shall be similarly subordinated; The interest expense relating to the repayment of any fully subordinated debt shall be considered covered expenses; and Any debt incurred by a note meeting the requirements of this section, and otherwise acceptable to the Commissioner, is not considered a liability and shall be recorded as equity. Composition of Assets. To meet the minimum net worth requirements, a provider-sponsored organization shall have the following composition of assets: At the time of application, at least $750,000 of the minimum net worth shall be in cash or cash equivalents; After the effective date of the Medicare+Choice contract, the greater of $750,000 or 40 percent of the minimum net worth amount shall be in cash or cash equivalents; During the licensing process, up to 10 percent of the minimum net worth amount may be comprised of intangible assets except that, if a provider-sponsored organization keeps $1,000,000 in cash or cash equivalents and does not use the administrative reduction, then up to 20 percent of that provider-sponsored organization's minimum net worth may be comprised of intangible assets; After the licensing process, a provider-sponsored organization shall keep the greater of $1,000,000 or 67 percent of the ongoing minimum net worth in cash or cash equivalents to qualify for the 20 percent level on intangibles; Subject to §D(1)—(4) of this regulation, health care delivery assets may be admitted at 100 percent of their value according to generally accepted accounting principles (GAAP); and Subject to §D(1)—(5) of this regulation, other assets may be admitted according to their value under statutory accounting practices (SAP).