97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
SB1646

 

Introduced 2/9/2011, by Sen. Carole Pankau

 

SYNOPSIS AS INTRODUCED:
 
215 ILCS 5/367  from Ch. 73, par. 979

    Amends the Illinois Insurance Code in the provision concerning group accident and health insurance to provide that no group policy may be issued or delivered without a provision that if an employee presents to an employer proof that the employee is covered under another accident and health insurance policy, then the employee may decline coverage by opting out of the group coverage and that the amount, if any, that would be charged to the employee if the employee were to participate in the group coverage shall be deducted from the premium for group coverage. Effective immediately.


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A BILL FOR

 

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1    AN ACT concerning insurance.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Insurance Code is amended by
5changing Section 367 as follows:
 
6    (215 ILCS 5/367)  (from Ch. 73, par. 979)
7    Sec. 367. Group accident and health insurance.
8    (1) Group accident and health insurance is hereby declared
9to be that form of accident and health insurance covering not
10less than 2 employees, members, or employees of members,
11written under a master policy issued to any governmental
12corporation, unit, agency or department thereof, or to any
13corporation, copartnership, individual employer, or to any
14association upon application of an executive officer or trustee
15of such association having a constitution or bylaws and formed
16in good faith for purposes other than that of obtaining
17insurance, where officers, members, employees, employees of
18members or classes or department thereof, may be insured for
19their individual benefit. In addition a group accident and
20health policy may be written to insure any group which may be
21insured under a group life insurance policy. The term
22"employees" shall include the officers, managers and employees
23of subsidiary or affiliated corporations, and the individual

 

 

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1proprietors, partners and employees of affiliated individuals
2and firms, when the business of such subsidiary or affiliated
3corporations, firms or individuals, is controlled by a common
4employer through stock ownership, contract or otherwise.
5    (2) Any insurance company authorized to write accident and
6health insurance in this State shall have power to issue group
7accident and health policies. No policy of group accident and
8health insurance may be issued or delivered in this State
9unless a copy of the form thereof shall have been filed with
10the department and approved by it in accordance with Section
11355, and it contains in substance those provisions contained in
12Sections 357.1 through 357.30 as may be applicable to group
13accident and health insurance and the following provisions:
14        (a) A provision that the policy, the application of the
15    employer, or executive officer or trustee of any
16    association, and the individual applications, if any, of
17    the employees, members or employees of members insured
18    shall constitute the entire contract between the parties,
19    and that all statements made by the employer, or the
20    executive officer or trustee, or by the individual
21    employees, members or employees of members shall (in the
22    absence of fraud) be deemed representations and not
23    warranties, and that no such statement shall be used in
24    defense to a claim under the policy, unless it is contained
25    in a written application.
26        (b) A provision that the insurer will issue to the

 

 

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1    employer, or to the executive officer or trustee of the
2    association, for delivery to the employee, member or
3    employee of a member, who is insured under such policy, an
4    individual certificate setting forth a statement as to the
5    insurance protection to which he is entitled and to whom
6    payable.
7        (c) A provision that to the group or class thereof
8    originally insured shall be added from time to time all new
9    employees of the employer, members of the association or
10    employees of members eligible to and applying for insurance
11    in such group or class.
12        (d) A provision that if an employee presents to an
13    employer proof that the employee is covered under another
14    accident and health insurance policy, then the employee may
15    decline coverage by opting out of the group coverage and
16    that the amount, if any, that would be charged to the
17    employee if the employee were to participate in the group
18    coverage shall be deducted from the premium for group
19    coverage.
20    (3) Anything in this code to the contrary notwithstanding,
21any group accident and health policy may provide that all or
22any portion of any indemnities provided by any such policy on
23account of hospital, nursing, medical or surgical services,
24may, at the insurer's option, be paid directly to the hospital
25or person rendering such services; but the policy may not
26require that the service be rendered by a particular hospital

 

 

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1or person. Payment so made shall discharge the insurer's
2obligation with respect to the amount of insurance so paid.
3Nothing in this subsection (3) shall prohibit an insurer from
4providing incentives for insureds to utilize the services of a
5particular hospital or person.
6    (4) Special group policies may be issued to school
7districts providing medical or hospital service, or both, for
8pupils of the district injured while participating in any
9athletic activity under the jurisdiction of or sponsored or
10controlled by the district or the authorities of any school
11thereof. The provisions of this Section governing the issuance
12of group accident and health insurance shall, insofar as
13applicable, control the issuance of such policies issued to
14schools.
15    (5) No policy of group accident and health insurance may be
16issued or delivered in this State unless it provides that upon
17the death of the insured employee or group member the
18dependents' coverage, if any, continues for a period of at
19least 90 days subject to any other policy provisions relating
20to termination of dependents' coverage.
21    (6) No group hospital policy covering miscellaneous
22hospital expenses issued or delivered in this State shall
23contain any exception or exclusion from coverage which would
24preclude the payment of expenses incurred for the processing
25and administration of blood and its components.
26    (7) No policy of group accident and health insurance,

 

 

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1delivered in this State more than 120 days after the effective
2day of the Section, which provides inpatient hospital coverage
3for sicknesses shall exclude from such coverage the treatment
4of alcoholism. This subsection shall not apply to a policy
5which covers only specified sicknesses.
6    (8) No policy of group accident and health insurance, which
7provides benefits for hospital or medical expenses based upon
8the actual expenses incurred, issued or delivered in this State
9shall contain any specific exception to coverage which would
10preclude the payment of actual expenses incurred in the
11examination and testing of a victim of an offense defined in
12Sections 12-13 through 12-16 of the Criminal Code of 1961, or
13an attempt to commit such offense, to establish that sexual
14contact did occur or did not occur, and to establish the
15presence or absence of sexually transmitted disease or
16infection, and examination and treatment of injuries and trauma
17sustained by the victim of such offense, arising out of the
18offense. Every group policy of accident and health insurance
19which specifically provides benefits for routine physical
20examinations shall provide full coverage for expenses incurred
21in the examination and testing of a victim of an offense
22defined in Sections 12-13 through 12-16 of the Criminal Code of
231961, or an attempt to commit such offense, as set forth in
24this Section. This subsection shall not apply to a policy which
25covers hospital and medical expenses for specified illnesses
26and injuries only.

 

 

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1    (9) For purposes of enabling the recovery of State funds,
2any insurance carrier subject to this Section shall upon
3reasonable demand by the Department of Public Health disclose
4the names and identities of its insureds entitled to benefits
5under this provision to the Department of Public Health
6whenever the Department of Public Health has determined that it
7has paid, or is about to pay, hospital or medical expenses for
8which an insurance carrier is liable under this Section. All
9information received by the Department of Public Health under
10this provision shall be held on a confidential basis and shall
11not be subject to subpoena and shall not be made public by the
12Department of Public Health or used for any purpose other than
13that authorized by this Section.
14    (10) Whenever the Department of Public Health finds that it
15has paid all or part of any hospital or medical expenses which
16an insurance carrier is obligated to pay under this Section,
17the Department of Public Health shall be entitled to receive
18reimbursement for its payments from such insurance carrier
19provided that the Department of Public Health has notified the
20insurance carrier of its claim before the carrier has paid the
21benefits to its insureds or the insureds' assignees.
22    (11) (a) No group hospital, medical or surgical expense
23    policy shall contain any provision whereby benefits
24    otherwise payable thereunder are subject to reduction
25    solely on account of the existence of similar benefits
26    provided under other group or group-type accident and

 

 

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1    sickness insurance policies where such reduction would
2    operate to reduce total benefits payable under these
3    policies below an amount equal to 100% of total allowable
4    expenses provided under these policies.
5        (b) When dependents of insureds are covered under 2
6    policies, both of which contain coordination of benefits
7    provisions, benefits of the policy of the insured whose
8    birthday falls earlier in the year are determined before
9    those of the policy of the insured whose birthday falls
10    later in the year. Birthday, as used herein, refers only to
11    the month and day in a calendar year, not the year in which
12    the person was born. The Department of Insurance shall
13    promulgate rules defining the order of benefit
14    determination pursuant to this paragraph (b).
15    (12) Every group policy under this Section shall be subject
16to the provisions of Sections 356g and 356n of this Code.
17    (13) No accident and health insurer providing coverage for
18hospital or medical expenses on an expense incurred basis shall
19deny reimbursement for an otherwise covered expense incurred
20for any organ transplantation procedure solely on the basis
21that such procedure is deemed experimental or investigational
22unless supported by the determination of the Office of Health
23Care Technology Assessment within the Agency for Health Care
24Policy and Research within the federal Department of Health and
25Human Services that such procedure is either experimental or
26investigational or that there is insufficient data or

 

 

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1experience to determine whether an organ transplantation
2procedure is clinically acceptable. If an accident and health
3insurer has made written request, or had one made on its behalf
4by a national organization, for determination by the Office of
5Health Care Technology Assessment within the Agency for Health
6Care Policy and Research within the federal Department of
7Health and Human Services as to whether a specific organ
8transplantation procedure is clinically acceptable and said
9organization fails to respond to such a request within a period
10of 90 days, the failure to act may be deemed a determination
11that the procedure is deemed to be experimental or
12investigational.
13    (14) Whenever a claim for benefits by an insured under a
14dental prepayment program is denied or reduced, based on the
15review of x-ray films, such review must be performed by a
16dentist.
17(Source: P.A. 91-549, eff. 8-14-99.)
 
18    Section 99. Effective date. This Act takes effect upon
19becoming law.