House committee substitute to the 2nd edition makes the following changes.  

Amends new GS 58-65-177(c) (pertaining to transfers in connection with reorganization) to provide that as part of reorganization a hospital service corporation may transfer cash, investments, or equity ownership interests in affiliates or subsidiaries to the nonprofit holding corporation and its subsidiaries by dividend, distribution, or otherwise (was, could transfer property, assets, rights, liabilities, equity, or ownership interests in subsidiaries or other owned business entities, and other interests). Now provides that the total statutory value of cash, investments, and ownership interests in affiliates or subsidiaries, net of liabilities, transferred as part of a reorganization may not exceed 25% of the hospital service corporation's admitted assets as of its most current annual statement filed with the Commissioner of Insurance (Commissioner). Specifies that any affiliate or subsidiary of the hospital service corporation transferred as part of a reorganization cannot be an insurer engaged in the issuance of health insurance policies.

Makes organizational changes to GS 58-65-181(b) (operation of nonprofit holding corporation and subsidiaries). Requires the nonprofit holding corporation to file annual with its financial statement executive compensation information for its CEO, CFO, and next eight highest paid executive officers. Requires an annual report to the Commissioner describing the nonprofit holding corporation’s strategic investment activities for the preceding year. Requires the governing board of the nonprofit holding corporation to be comprised solely of individuals on the governing board of the hospital service corporation.

Amends GS 58-65-183 (operation of a hospital service corporation) to specify that neither a reorganization nor any other transaction permitted by the Part (was, just reorganization) constitute or require a conversion of the hospital service corporation pursuant to GS 58-65-131, GS 58-65-132, GS 58-65-133, or any other law of this State. Also specifies that neither a reorganization nor any other transaction permitted by the Part (was, just reorganization) will require the nonprofit holding corporation, hospital service corporation, or any affiliate of either to make any distribution or payment to any person or entity.