Section 2001.1  Applicability

 

Unless otherwise provided, this Subpart is applicable to all individual and group accident and health policies and certificates, including coverage provided by a Health Maintenance Organization, except to the extent that such policies, certificates or coverage provides for excepted benefits or short-term, limited-duration health insurance coverage. Sections 2001.3 and 2001.13 apply to all individual and group policies, certificates, and coverage regardless of whether they provide excepted benefits or short-term, limited-duration health insurance coverage.

 

(Source:  Amended at 45 Ill. Reg. 11816, effective September 17, 2021)

 

Section 2001.2  Definitions and Cross-References

 

a)         The following definitions shall apply to this Part:

 

"ACA" means the Patient Protection and Affordable Care Act (42 USC 18001 et seq.).

 

"Code" means the Illinois Insurance Code [215 ILCS 5].

 

"Director" means the Director of the Illinois Department of Insurance.

 

"EHB" means essential health benefit or benefits.

 

"ERISA" means the Employee Retirement Income Security Act of 1974, as amended (29 USC 1001 et seq.).

 

"Excepted benefits", as defined at 26 USC 9832, means benefits under one or more (or any combination) of the following:

 

Benefits not subject to requirements:

 

Coverage only for accident, disability income insurance, or any combination thereof;

 

Coverage issued as a supplement to liability insurance;

 

Liability insurance, including general liability insurance and automobile liability insurance;

 

Workers' compensation or similar insurance;

 

Automobile medical payment insurance;

 

Credit-only insurance;

 

Coverage for on-site medical clinics;

 

Other similar insurance coverage under which benefits for medical care are secondary or incidental to other insurance benefits.

 

Benefits not subject to requirements if offered separately:

 

Limited scope dental or vision benefits; and

 

Benefits for long-term care, nursing home care, home health care, community-based care, or any combination thereof.

 

Benefits not subject to requirements if offered as independent, noncoordinated benefits:

 

Coverage only for a specified disease or illness;

 

Hospital indemnity or other fixed indemnity insurance paid as a fixed dollar amount per day or other period, paid per event or service, or upon benefits paid upon a basis other than period of time, regardless of the amount of expenses incurred.

 

Benefits not subject to requirements if offered as a separate insurance policy:  Medicare supplemental health insurance (as defined under section 1882(g)(1) of the Social Security Act (42 USC 1395ss(g)(1)), coverage supplemental to the coverage provided under 10 USC 55, and similar supplemental coverage provided to coverage under a group health plan.

 

"Health Benefits Exchange" or "Exchange" means the Illinois Health Benefits Exchange established pursuant to 42 USC 18031(b) and 215 ILCS 122/5-5, also known as the Illinois Health Insurance Marketplace.

 

"HHS" means the United States Department of Health and Human Services.

 

"Network Plan" means health insurance coverage of a health insurance issuer under which the financing and delivery of medical care (including items and services paid for as medical care) are provided, in whole or in part, through a defined set of providers under contract with the issuer.

 

"PHS Act" means the Public Health Service Act (42 USC 201 et seq.).

 

"Preexisting condition exclusion" means a limitation or exclusion of benefits (including a denial of coverage) based on the fact that the condition was present before the effective date of coverage (or if coverage is denied, the date of the denial) under a group health plan or group or individual health insurance coverage (or other coverage provided to federally eligible individuals pursuant to 45 CFR 148), whether or not any medical advice, diagnosis, care, or treatment was recommended or received before that day. A preexisting condition exclusion includes any limitation or exclusion of benefits (including a denial of coverage) applicable to an individual as a result of information relating to an individual's health status before the individual's effective date of coverage (or if coverage is denied, the date of the denial) under a group health plan, or group or individual health insurance coverage (or other coverage provided to federally eligible individuals pursuant to 45 CFR 148), such as a condition identified as a result of a pre-enrollment questionnaire or physical examination given to the individual, or review of medical records relating to the pre-enrollment period. (See 45 CFR 144.103.)

 

"SBC" means summary of benefits and coverage.

 

"Secretary" means the Secretary of the United States Department of Health and Human Services, except when specified otherwise within this Part.

 

"Waiting period" means, with respect to a group health plan and an individual who is a potential participant or beneficiary in the plan, the period of time that must pass with respect to the individual before the individual is eligible to be covered for benefits under the terms of the plan.  (See 42 USC 300gg(b)(4).)

 

b)         In this Part, parenthetical cross-references following rule text are to the federal statutes or regulations relating to that Illinois rule provision.

 

(Source:  Amended at 38 Ill. Reg. 23379, effective November 25, 2014)

 

Section 2001.3  Discretionary Clauses Prohibited

 

No policy, contract, certificate, endorsement, rider application or agreement offered or issued in this State, by a health carrier, to provide, deliver, arrange for, pay for or reimburse any of the costs of health care services or of a disability may contain a provision purporting to reserve discretion to the health carrier to interpret the terms of the contract, or to provide standards of interpretation or review that are inconsistent with the laws of this State.

 

(Source:  Added at 29 Ill. Reg. 10172, effective July 1, 2005)

 

Section 2001.4  Guaranteed Availability and Renewability of Coverage

 

a)         Guaranteed Availability of Coverage in the Individual and Group Market

Subject to subsections (b) through (d), a health insurance issuer that offers health insurance coverage in the individual or group market in this State must offer to any individual or employer in this State all products that are approved for sale in the applicable market, and must accept any individual or employer that applies for any of those products.  (45 CFR 147.106)

 

b)         Enrollment Periods

A health insurance issuer may restrict enrollment in health insurance coverage to open or special enrollment periods.

 

1)         Open Enrollment Periods

 

A)        Group Market

A health insurance issuer in the group market must allow an employer to purchase health insurance coverage for a group health plan at any point during the year. In the case of health insurance coverage offered in the small group market, a health insurance issuer may limit the availability of coverage to an annual enrollment period that begins November 15 and extends through December 15 of each year in the case of a plan sponsor that is unable to comply with a material plan provision relating to employer contribution or group participation rules as defined in 45 CFR 147.106(b)(3), pursuant to 215 ILCS 97/30(B)(3) and, in the case of a QHP offered in the Small Business Health Option Program (SHOP), as permitted by 45 CFR 156.285(c). With respect to coverage in the small group market, and in the large group market if such coverage is offered in a SHOP in a state, coverage must become effective consistent with the dates described in 45 CFR 155.725(h).

 

B)        Individual Market

A health insurance issuer in the individual market must allow an individual to purchase health insurance coverage during the initial and annual open enrollment periods described in 45 CFR 155.410(b) and (e). Coverage must become effective consistent with the dates described in 45 CFR 155.410(c) and (f).

 

2)         Limited Open Enrollment Periods

A health insurance issuer in the individual market must provide a limited open enrollment period for the events described in 45 CFR 155.420(d), excluding paragraphs (d)(3) (concerning citizenship status), (d)(8) (concerning Indians), and (d)(9) (concerning exceptional circumstances). In addition, a health insurance issuer in the individual market must provide, with respect to individuals enrolled in non-calendar year individual health insurance policies, a limited open enrollment period beginning on the date that is 30 calendar days prior to the date the policy year ends in 2014.

 

3)         Special Enrollment Periods

A health insurance issuer in the group and individual market must establish special enrollment periods for qualifying events as defined under section 603 of ERISA. These special enrollment periods are in addition to any other special enrollment periods that are required under federal and Illinois law.

 

4)         Length of Enrollment Periods

With respect to the group market, enrollees must be provided 30 calendar days after the date of the qualifying event described in subsection (b)(3) to elect coverage. With respect to the individual market, enrollees must be provided 60 calendar days after the date of an event described in subsections (b)(2) and (b)(3) to elect coverage.

 

5)         Effective Date of Coverage for Limited Open and Special Enrollment Periods

With respect to an election made under subsection (b)(2) or (b)(3), coverage must become effective consistent with the dates described in 45 CFR 155.420(b). (45 CFR 147.106)

 

c)         Special Rules for Network Plans

 

1)         In the case of a health insurance issuer that offers health insurance coverage in the group and individual market through a network plan, the issuer may do the following:

 

A)        Limit the employers that may apply for the coverage to those with eligible individuals in the group market who live, work or reside in the service area for the network plan, and limit the individuals who may apply for the coverage in the individual market to those who live or reside in the service area for the network plan.

 

B)        Within the service area of the plan, deny coverage to employers and individuals if the issuer has demonstrated to the Director the following:

 

i)          It will not have the capacity to deliver services adequately to enrollees of any additional groups or any additional individuals because of its obligations to existing group contract holders and enrollees.

 

ii)         It is applying this subsection (c)(1) uniformly to all employers and individuals without regard to the claims experience of those individuals, employers and their employees (and their dependents) or any health status-related factor relating to such individuals, employees, and dependents.

 

2)         An issuer that denies health insurance coverage to an individual or an employer in any service area, in accordance with subsection (c)(1)(B), may not offer coverage in the individual or group market, as applicable, within the service area to any individual or employer, as applicable, for a period of 180 calendar days after the date the coverage is denied. This subsection (c)(2) does not limit the issuer's ability to renew coverage already in force or relieve the issuer of the responsibility to renew that coverage.

 

3)         Coverage offered within a service area after the 180-day period specified in subsection (c)(2) is subject to the requirements of this Section. (45 CFR 147.106)

 

d)         Application of Financial Capacity Limits

 

1)         A health insurance issuer may deny health insurance coverage in the group or individual market if the issuer has demonstrated to the Director the following:

 

A)        It does not have the financial reserves necessary to offer additional coverage.

 

B)        It is applying this subsection (d)(1) uniformly to all employers or individuals in the group or individual market, as applicable, in this State consistent with applicable Illinois law and without regard to the claims experience of those individuals, employers and their employees (and their dependents) or any health status-related factor relating to those individuals, employees and dependents.

 

2)         An issuer that denies health insurance coverage to any employer or individual in this State under subsection (d)(1) may not offer coverage in the group or individual market, as applicable, in this State before the later of either of the following dates:

 

A)        The 181^st day after the date the issuer denies coverage;

 

B)        The date the issuer demonstrates to the Director, if required under applicable Illinois law, that the issuer has sufficient financial reserves to underwrite additional coverage.

 

3)         Subsection (d)(2) does not limit the issuer's ability to renew coverage already in force or relieve the issuer of the responsibility to renew that coverage.

 

4)         Coverage offered after the 180-day period specified in subsection (d)(2) is subject to the requirements of this Section.

 

5)         The Director may provide for the application of this subsection (d) on a service-area-specific basis. (45 CFR 147.106)

 

e)         Marketing

A health insurance issuer and its officials, employees, agents and representatives must comply with Illinois law regarding marketing by health insurance issuers and cannot employ marketing practices or benefit designs that will have the effect of discouraging the enrollment of individuals with significant health needs in health insurance coverage or discriminate based on an individual's race, color, national origin, present or predicted disability, age, sex, gender identity, sexual orientation, expected length of life, degree of medical dependency, quality of life, or other health conditions. (45 CFR 147.106)

 

f)         Guaranteed Renewability of Coverage General Rule.

Subject to subsections (g) through (i), a health insurance issuer offering health insurance coverage in the individual or group market is required to renew or continue in force the coverage at the option of the plan sponsor or the individual, as applicable. (45 CFR 147.106)

 

g)         Exceptions

An issuer may nonrenew or discontinue health insurance coverage offered in the group or individual market based only on one or more of the following:

 

1)         Nonpayment of Premiums

The plan sponsor or individual, as applicable, has failed to pay premiums or contributions in accordance with the terms of the health insurance coverage, including any timeliness requirements.

 

2)         Fraud

The plan sponsor or individual, as applicable, has performed an act or practice that constitutes fraud or made an intentional misrepresentation of material fact in connection with the coverage.

 

3)         Violation of Participation or Contribution Rules

In the case of group health insurance coverage, the plan sponsor has failed to comply with a material plan provision relating to employer contribution or group participation rules, pursuant to applicable Illinois law. For purposes of this subsection (g)(13), the following apply:

 

A)        The term "employer contribution rule" means a requirement relating to the minimum level or amount of employer contribution toward the premium for enrollment of participants and beneficiaries.

 

B)        The term "group participation rule" means a requirement relating to the minimum number of participants or beneficiaries that must be enrolled in relation to a specified percentage or number of eligible individuals or employees of an employer.

 

4)         Termination of Plan

The issuer is ceasing to offer coverage in the market in accordance with subsection (h) or (i) and applicable Illinois law.

 

5)         Enrollees' Movement Outside Service Area

For network plans, there is no longer any enrollee under the plan who lives, resides or works in the service area of the issuer (or in the area for which the issuer is authorized to do business) and, in the case of the small group market, the issuer applies the same criteria it would apply in denying enrollment in the plan under 45 CFR 147.104(c)(1)(i).

 

6)         Association Membership Ceases

For coverage made available in the small or large group market only through one or more bona fide associations, if the employer's membership in the bona fide association ceases, but only if the coverage is terminated uniformly without regard to any health status-related factor relating to any covered individual. (45 CFR 147.106)

 

h)         Discontinuing a Particular Product

In any case in which an issuer decides to discontinue offering a particular product offered in the group or individual market, that product may be discontinued by the issuer in accordance with applicable Illinois law in the applicable market only if the following occurs:

 

1)         The issuer provides notice in writing to each plan sponsor or individual, as applicable, provided that particular product in that market (and to all participants and beneficiaries covered under such coverage) of the discontinuation at least 90 calendar days before the date the coverage will be discontinued.

 

2)         The issuer offers to each plan sponsor or individual, as applicable, provided that particular product the option, on a guaranteed availability basis, to purchase all (or, in the case of the large group market, any) other health insurance coverage currently being offered by the issuer to a group health plan or individual health insurance coverage in that market.

 

3)         In exercising the option to discontinue that product and in offering the option of coverage under subsection (h)(2), the issuer acts uniformly without regard to the claims experience of those sponsors or individuals, as applicable, or any health status-related factor relating to any participants or beneficiaries covered or new participants or beneficiaries who may become eligible for such coverage. (45 CFR 147.106)

 

i)          Discontinuing All Coverage

 

1)         An issuer may elect to discontinue offering all health insurance coverage in the individual or group market, or all markets, in this State in accordance with applicable Illinois law only if:

 

A)        The issuer provides notice in writing to the Director and to each plan sponsor or individual, as applicable, (and all participants and beneficiaries covered under the coverage) of the discontinuation at least 180 calendar days prior to the date the coverage will be discontinued; and

 

B)        All health insurance policies issued or delivered for issuance in this State in the applicable market (or markets) are discontinued and not renewed.

 

2)         An issuer that elects to discontinue offering all health insurance coverage in a market (or markets) in this State as described in this subsection (i) may not issue coverage in the applicable market (or markets) in this State during the 5-year period beginning on the date of discontinuation of the last coverage not renewed. (45 CFR 147.106)

 

j)          Exception for Uniform Modification of Coverage

Only at the time of coverage renewal may issuers modify the health insurance coverage for a product offered to a group health plan in the following:

 

1)         Large group market;

 

2)         Small group market if, for coverage available in this market (other than only through one or more bona fide associations), the modification is consistent with Illinois law and is effective uniformly among group health plans with that product. (45 CFR 147.106)

 

k)         Application to Coverage Offered Only Through Associations

In the case of health insurance coverage that is made available by a health insurance issuer in the small or large group market to employers only through one or more associations, the reference to "plan sponsor" is deemed, with respect to coverage provided to an employer member of the association, to include a reference to the employer. (45 CFR 147.106)

 

l)          Applicability Date

The provisions of this Section apply for plan years (in the individual market, policy years) beginning on or after January 1, 2014. (45 CFR 147.106)

 

m)        Grandfathered Health Plans

This Section does not apply to grandfathered health plans in accordance with 45 CFR 147.140. (45 CFR 147.106)

 

(Source:  Added at 38 Ill. Reg. 2037, effective January 2, 2014)

 

Section 2001.5  Prohibition of Preexisting Condition Exclusions

 

a)         No Preexisting Condition Exclusions

 

1)         In General

A group health plan, or a health insurance issuer offering group or individual health insurance coverage, may not impose any preexisting condition exclusion (as defined in Section 2001.2). (45 CFR 147.108(a))

 

2)         Subsection (a) is illustrated by the examples appearing in 45 CFR 147.108.

 

b)         Applicability

 

1)         General Applicability Date

Except as provided in subsection (b)(2), this Section applies for plan years beginning on or after January 1, 2014; in the case of individual health insurance coverage, for policy years beginning, or applications denied, on or after January 1, 2014.

 

2)         Early Applicability Date for Children

This Section applies with respect to enrollees, including applicants for enrollment, who are under 19 years of age for plan years beginning on or after September 23, 2010; in the case of individual health insurance coverage, for policy years beginning, or applications denied, on or after September 23, 2010.

 

3)         Applicability to Grandfathered Health Plans

See 45 CFR 147.140 for determining the application of this Section to grandfathered health plans (providing that a grandfathered health plan that is a group health plan or group health insurance coverage must comply with the prohibition against preexisting condition exclusions; however, a grandfathered health plan that is individual health insurance coverage is not required to comply with PHS Act section 2704 ). (45 CFR 147.108(b))

 

4)         Subsection (b) is illustrated by the examples appearing in 45 CFR 147.108. 

 

(Source:  Added at 38 Ill. Reg. 2037, effective January 2, 2014)

 

Section 2001.6  No Lifetime or Annual Limits

 

a)         Prohibition

 

1)         Lifetime Limits

Except as provided in subsection (b), a group health plan, or a health insurance issuer offering group or individual health insurance coverage, may not establish any lifetime limit on the dollar amount of benefits for any individual.

 

2)         Annual Limits

 

A)        General Rule

Except as provided in subsections (a)(2)(B), (b) and (d), a group health plan, or a health insurance issuer offering group or individual health insurance coverage, may not establish any annual limit on the dollar amount of benefits for any individual.

 

B)        Exception for Health Flexible Spending Arrangements

A health flexible spending arrangement (as defined in section 106(c)(2) of the Internal Revenue Code (26 USC 106(c)(2)) is not subject to the requirement in subsection (a)(2)(A).  (45 CFR 147.126)

 

b)         Construction

 

1)         Permissible Limits on Specific Covered Benefits

This Section does not prevent a group health plan, or a health insurance issuer offering group or individual health insurance coverage, from placing annual or lifetime dollar limits with respect to any individual on specific covered benefits that are not essential health benefits to the extent that such limits are otherwise permitted under applicable federal or Illinois law. (The scope of essential health benefits is addressed in subsection (c)).

 

2)         Condition-Based Exclusions

This Section does not prevent a group health plan, or a health insurance issuer offering group or individual health insurance coverage, from excluding all benefits for a condition. However, if any benefits are provided for a condition, then the requirements of this Section apply. Other requirements of federal or Illinois law may require coverage of certain benefits.  (45 CFR 147.126)

 

c)         Definition of Essential Health Benefits

Essential health benefits shall be as defined in Section 2001.11(c).

 

d)         Restricted Annual Limits Permissible Prior to 2014

 

1)         In General

With respect to plan years (in the individual market, policy years) beginning prior to January 1, 2014, a group health plan, or a health insurance issuer offering group or individual health insurance coverage, may establish, for any individual, an annual limit on the dollar amount of benefits that are essential health benefits, provided the limit is no less than the amounts in the following schedule:

 

A)        For a plan year (in the individual market, policy year) beginning on or after September 23, 2010, but before September 23, 2011, $750,000.

 

B)        For a plan year (in the individual market, policy year) beginning on or after September 23, 2011, but before September 23, 2012, $1,250,000.

 

C)        For plan years (in the individual market, policy years) beginning on or after September 23, 2012, but before January 1, 2014, $2,000,000.

 

2)         Only Essential Health Benefits Taken Into Account

In determining whether an individual has received benefits that meet or exceed the applicable amount described in subsection (d)(1), a plan or issuer must take into account only essential health benefits.

 

3)         Waivers

For plan years (in the individual market, policy years) beginning before January 1, 2014, the requirements of subsection (d)(1) relating to annual limits may be waived (for such period as is specified by the Secretary) for a group health plan or health insurance coverage that has an annual dollar limit on benefits below the restricted annual limits provided under subsection (d)(1) if compliance with subsection (d)(1) would result in a significant decrease in access to benefits under the plan or health insurance coverage or would significantly increase premiums for the plan or health insurance coverage.  (45 CFR 147.126)

 

e)         Transitional Rules for Individuals Whose Coverage or Benefits Ended by Reason of Reaching a Lifetime Limit

 

1)         In General

The relief provided in the transitional rules of subsection (e) applies with respect to any individual:

 

A)        Whose coverage or benefits under a group health plan or group or individual health insurance coverage ended by reason of reaching a lifetime limit on the dollar value of all benefits for any individual (which, under this Section, is no longer permissible); and

 

B)        Who becomes eligible (or is required to become eligible) for benefits not subject to a lifetime limit on the dollar value of all benefits under the group health plan or group or individual health insurance coverage on the first day of the first plan year (in the individual market, policy year) beginning on or after September 23, 2010, by reason of the application of this Section.

 

2)         Notice and Enrollment Opportunity Requirements

 

A)        If an individual described in subsection (e)(1) is eligible for benefits (or is required to become eligible for benefits) under the group health plan, or group or individual health insurance coverage, described in subsection (e)(1), the plan and the issuer are required to give the individual written notice that the lifetime limit on the dollar value of all benefits no longer applies and that the individual, if covered, is once again eligible for benefits under the plan. Additionally, if the individual is not enrolled in the plan or health insurance coverage, or if an enrolled individual is eligible for but not enrolled in any benefit package under the plan or health insurance coverage, then the plan and issuer must also give such an individual an opportunity to enroll that continues for at least 30 days (including written notice of the opportunity to enroll). The notices and enrollment opportunity required under this subsection (e)(2)(A) must be provided beginning not later than the first day of the first plan year (in the individual market, policy year) beginning on or after September 23, 2010.

 

B)        The notices required under subsection (e)(2)(A) may be provided to an employee on behalf of the employee's dependent (in the individual market, to the primary subscriber on behalf of the primary subscriber's dependent). In addition, for a group health plan or group health insurance coverage, the notices may be included with other enrollment materials that a plan distributes to employees, provided the statement is prominent. For either notice, with respect to a group health plan or group health insurance coverage, if a notice satisfying the requirements of subsection (e)(2) is provided to an individual, the obligation to provide the notice with respect to that individual is satisfied for both the plan and the issuer.

 

3)         Effective Date of Coverage

In the case of an individual who enrolls under subsection (e)(2), coverage must take effect not later than the first day of the first plan year (in the individual market, policy year) beginning on or after September 23, 2010.

 

4)         Treatment of Enrollees in a Group Health Plan

Any individual enrolling in a group health plan pursuant to subsection (e)(2) must be treated as if the individual were a special enrollee, as provided under 45 CFR 146.117(d). Accordingly, the individual (and, if the individual would not be a participant once enrolled in the plan, the participant through whom the individual is otherwise eligible for coverage under the plan) must be offered all the benefit packages available to similarly situated individuals who did not lose coverage by reason of reaching a lifetime limit on the dollar value of all benefits. For this purpose, any difference in benefits or cost-sharing requirements constitutes a different benefit package. The individual also cannot be required to pay more for coverage than similarly situated individuals who did not lose coverage by reason of reaching a lifetime limit on the dollar value of all benefits.  (45 CFR 147.126)

 

5)         This subsection (e) is illustrated by the examples appearing in 45 CFR 147.126.

 

f)         Applicability Date

This Section applies for plan years (in the individual market, for policy years) beginning on or after September 23, 2010. See 45 CFR 147.140 for determining the application of this Section to grandfathered health plans (providing that the prohibitions on lifetime and annual limits apply to all grandfathered health plans that are group health plans and group health insurance coverage, including the special rules regarding restricted annual limits, and the prohibition on lifetime limits apply to individual health insurance coverage that is a grandfathered health plan but the rules on annual limits do not apply to individual health insurance coverage that is a grandfathered health plan). (45 CFR 147.126)

 

(Source:  Added at 38 Ill. Reg. 2037, effective January 2, 2014)

 

Section 2001.7  Prohibition on Rescissions

 

a)         Prohibition on Rescissions

 

1)         A group health plan, or a health insurance issuer offering group or individual health insurance coverage, must not rescind coverage under the plan, or under the policy, certificate, or contract of insurance, with respect to an individual (including a group to which the individual belongs or family coverage in which the individual is included) once the individual is covered under the plan or coverage, unless the individual (or a person seeking coverage on behalf of the individual) performs an act, practice or omission that constitutes fraud, or unless the individual makes an intentional misrepresentation of material fact, as prohibited by the terms of the plan or coverage. A group health plan, or a health insurance issuer offering group or individual health insurance coverage, must provide at least 30 days advance written notice to each participant (in the individual market, primary subscriber) who would be affected before coverage may be rescinded under this subsection (a)(1), regardless of, in the case of group coverage, whether the coverage is insured or self-insured, or whether the rescission applies to an entire group or only to an individual within the group. (This subsection (a)(1) applies regardless of any contestability period that may otherwise apply.)

 

2)         For purposes of this Section, a rescission is a cancellation or discontinuance of coverage that has retroactive effect. For example, a cancellation that treats a policy as void from the time of the individual's or group's enrollment is a rescission. As another example, a cancellation that voids benefits paid up to a year before the cancellation is also a rescission for this purpose. A cancellation or discontinuance of coverage is not a rescission if:

 

A)        The cancellation or discontinuance of coverage has only a prospective effect; or

 

B)        The cancellation or discontinuance of coverage is effective retroactively to the extent it is attributable to a failure to timely pay required premiums or contributions towards the cost of coverage.  (45 CFR 147.128)

 

3)         This subsection (a) is illustrated by the examples appearing in 45 CFR 147.128.

 

b)         Compliance with Other Requirements

Other requirements of federal or Illinois law may apply in connection with a rescission of coverage.  (45 CFR 147.128)

 

c)         Applicability Date

This Section applies for plan years (in the individual market, for policy years) beginning on or after September 23, 2010. See 45 CFR 147.140  for determining the application of this Section to grandfathered health plans (providing that the rules regarding rescissions and advance notice apply to all grandfathered health plans). (45 CFR 147.128)

 

(Source:  Added at 38 Ill. Reg. 2037, effective January 2, 2014)

 

Section 2001.8  Coverage of Preventive Health Services

 

a)         Services

 

1)         In General

Beginning at the time described in subsection (b), and subject to 45 CFR 147.131, a group health plan, or a health insurance issuer offering group or individual health insurance coverage, must provide coverage stated both in the policy and certificate (for group coverage) for all of the following items and services, and may not impose any cost-sharing requirements (such as a copayment, coinsurance or deductible) with respect to those items or services:

 

A)        Evidence-based items or services that have in effect a rating of A or B in the current recommendations of the United States Preventive Services Task Force with respect to the individual involved (except as otherwise provided in subsection (c));

 

B)        Immunizations for routine use in children, adolescents and adults that have in effect a recommendation from the Advisory Committee on Immunization Practices of the Centers for Disease Control and Prevention with respect to the individual involved (for this purpose, a recommendation from the Advisory Committee on Immunization Practices of the Centers for Disease Control and Prevention is considered in effect after it has been adopted by the Director of the Centers for Disease Control and Prevention, and a recommendation is considered to be for routine use if it is listed on the Immunization Schedules of the Centers for Disease Control and Prevention);

 

C)        With respect to infants, children and adolescents, evidence-informed preventive care and screenings provided for in comprehensive guidelines supported by the Health Resources and Services Administration; and

 

D)        With respect to women, to the extent not described in subsection (a)(1)(A), preventive care and screenings provided for in binding comprehensive health plan coverage guidelines supported by the Health Resources and Services Administration.

 

i)          In developing the binding health plan coverage guidelines specified in this subsection (a)(1)(D), the Health Resources and Services Administration shall be informed by evidence and may establish exemptions from those guidelines allowed with respect to group health plans established or maintained by religious employers and health insurance coverage provided in connection with group health plans established or maintained by religious employers with respect to any requirement to cover contraceptive services under such guidelines.

 

ii)         For purposes of this subsection (a)(1)(D), a "religious employer" is an organization that meets all of the following criteria:  The inculcation of religious values is the purpose of the organization; the organization primarily employs persons who share the religious tenets of the organization; the organization serves primarily persons who share the religious tenets of the organization; the organization is a nonprofit organization as described in section 6033(a)(1) and (a)(3)(A)(i) or (iii) of the Internal Revenue Code of 1986, as amended (26 USC 6033).

 

2)         Office Visits

 

A)        If an item or service described in subsection (a)(1) is billed separately (or is tracked as individual encounter data separately) from an office visit, then a plan or issuer may impose cost-sharing requirements with respect to the office visit.

 

B)        If an item or service described in subsection (a)(1) is not billed separately (or is not tracked as individual encounter data separately) from an office visit and the primary purpose of the office visit is the delivery of such an item or service, then a plan or issuer may not impose cost-sharing requirements with respect to the office visit.

 

C)        If an item or service described in subsection (a)(1) is not billed separately (or is not tracked as individual encounter data separately) from an office visit and the primary purpose of the office visit is not the delivery of such an item or service, then a plan or issuer may impose cost-sharing requirements with respect to the office visit.

 

D)        This subsection (a)(2) is illustrated by the examples appearing in 45 CFR 147.130.

 

3)         Out-of-Network Providers

Nothing in this Section requires a plan or issuer that has a network of providers to provide benefits for items or services described in subsection (a)(1) that are delivered by an out-of-network provider. Moreover, nothing in this Section precludes a plan or issuer that has a network of providers from imposing cost-sharing requirements for items or services described in subsection (a)(1) that are delivered by an out-of-network provider.

 

4)         Reasonable Medical Management

Nothing prevents a plan or issuer from using reasonable medical management techniques to determine the frequency, method, treatment or setting for an item or service described in subsection (a)(1) to the extent not specified in the recommendation or guideline.

 

5)         Services Not Described

Nothing in this Section prohibits a plan or issuer from providing coverage for items and services in addition to those recommended by the United States Preventive Services Task Force or the Advisory Committee on Immunization Practices of the Centers for Disease Control and Prevention, or provided for by guidelines supported by the Health Resources and Services Administration, or from denying coverage for items and services that are not recommended by that task force or that advisory committee, or under those guidelines. A plan or issuer may impose cost-sharing requirements for a treatment not described in subsection (a)(1), even if the treatment results from an item or service described in subsection (a)(1). (45 CFR 147.130)

 

b)         Timing

 

1)         In General

A plan or issuer must provide coverage pursuant to subsection (a)(1) for plan years (in the individual market, policy years) that begin on or after September 23, 2010, or, if later, for plan years (in the individual market, policy years) that begin on or after the date that is one year after the date the recommendation or guideline is issued.

 

2)         Changes in Recommendations or Guidelines

A plan or issuer is not required under this Section to provide coverage for any items and services specified in any recommendation or guideline described in subsection (a)(1) after the recommendation or guideline is no longer described in subsection (a)(1). Other requirements of federal or Illinois law may apply in connection with a plan or issuer ceasing to provide coverage for any such items or services, including PHS Act section 2715(d)(4), which requires a plan or issuer to give 60 days advance notice to an enrollee before any material modification will become effective. (45 CFR 147.130)

 

c)         Recommendations not Current

For purposes of subsection (a)(1)(A), and for purposes of any other provision of law, recommendations of the United States Preventive Service Task Force regarding breast cancer screening, mammography and prevention issued in or around November 2009 are not considered to be current. (45 CFR 147.130)

 

d)         Applicability Date

This Section applies for plan years (in the individual market, for policy years) beginning on or after September 23, 2010. See 45 CFR 147.140 for determining the application of this Section to grandfathered health plans (providing that the provisions of this Section regarding coverage of preventive health services do not apply to grandfathered health plans). (45 CFR 147.130)

 

(Source:  Added at 38 Ill. Reg. 2037, effective January 2, 2014)

 

Section 2001.9  Prohibiting Discrimination Against Participants and Beneficiaries Based on Health Status

 

a)         Health Factors

 

1)         The term health factor means, in relation to an individual, any of the following health status-related factors:

 

A)        Health status;

 

B)        Medical condition (including both physical and mental illnesses), as defined in 45 CFR 144.103;

 

C)        Claims experience;

 

D)        Receipt of health care;

 

E)        Medical history;

 

F)         Genetic information, as defined in 45 CFR 146.122(a);

 

G)        Evidence of insurability; or

 

H)        Disability.

 

2)         Evidence of insurability includes:

 

A)        Conditions arising out of acts of domestic violence; and

 

B)        Participation in activities such as motorcycling, snowmobiling, all-terrain vehicle riding, horseback riding, skiing, and other similar activities.

 

3)         The decision whether health coverage is elected for an individual (including the time chosen to enroll, such as under special enrollment or late enrollment) is not, itself, within the scope of any health factor. (However, under 45 CFR 146.117, a plan or issuer must treat special enrollees the same as similarly situated individuals who are enrolled when first eligible.) (45 CFR 146.121)

 

b)         Prohibited Discrimination in Rules for Eligibility

 

1)         In General

 

A)        A group health plan, and a health insurance issuer offering health insurance coverage in connection with a group health plan, may not establish any rule for eligibility (including continued eligibility) of any individual to enroll for benefits under the terms of the plan or group health insurance coverage that discriminates based on any health factor that relates to that individual or a dependent of that individual. This rule is subject to the provisions of subsection (b)(2) (explaining how this Section applies to benefits), subsection (b)(3) (allowing plans to impose certain preexisting condition exclusions), subsection (d) (containing rules for establishing groups of similarly situated individuals), subsection (e) (relating to nonconfinement, actively-at-work, and other service requirements), subsection (f) (relating to wellness programs), and subsection (g) (permitting favorable treatment of individuals with adverse health factors).

 

B)        For purposes of this Section, rules for eligibility include, but are not limited to, rules relating to:

 

i)          Enrollment;

 

ii)         The effective date of coverage;

 

iii)        Waiting (or affiliation) periods;

 

iv)        Late and special enrollment;

 

v)         Eligibility for benefit packages (including rules for individuals to change their selection among benefit packages);

 

vi)        Benefits (including rules relating to covered benefits, benefit restrictions, and cost-sharing mechanisms such as coinsurance, copayments, and deductibles), as described in subsections (b)(2) and (b)(3);

 

vii)       Continued eligibility; and

 

viii)      Terminating coverage (including disenrollment) of any individual under the plan. (45 CFR 146.121)

 

C)        This subsection (b)(1) is illustrated by the examples appearing in 45 CFR 146.121(b)(1)(iii).

 

2)         Application to Benefits

 

A)        General Rule

 

i)          Under this Section, a group health plan or group health insurance issuer is not required to provide coverage for any particular benefit to any group of similarly situated individuals.

 

ii)         However, benefits provided under a plan or through group health insurance coverage must be uniformly available to all similarly situated individuals (as described in subsection (d)). Likewise, any restriction on a benefit or benefits must apply uniformly to all similarly situated individuals and must not be directed at individual participants or beneficiaries based on any health factor of the participants or beneficiaries (determined based on all the relevant facts and circumstances). Thus, for example, a plan or issuer may limit or exclude benefits in relation to a specific disease or condition, limit or exclude benefits for certain types of treatments or drugs, or limit or exclude benefits based on a determination of whether the benefits are experimental or not medically necessary, but only if the benefit limitation or exclusion applies uniformly to all similarly situated individuals and is not directed at individual participants or beneficiaries based on any health factor of the participants or beneficiaries. In addition, a plan or issuer may impose annual, lifetime or other limits on benefits and may require the satisfaction of a deductible, copayment, coinsurance or other cost-sharing requirement in order to obtain a benefit if the limit or cost-sharing requirement applies uniformly to all similarly situated individuals and is not directed at individual participants or beneficiaries based on any health factor of the participants or beneficiaries. In the case of a cost-sharing requirement, see also subsection (b)(2)(B), which permits variances in the application of a cost-sharing mechanism made available under a wellness program. (Whether any plan provision or practice with respect to benefits complies with this subsection (b)(2)(A) does not affect whether the provision or practice is permitted under any other provision of ERISA, the Americans With Disabilities Act (42 USC 12101 et seq.), or any other law, whether State or federal.)

 

iii)        For purposes of this subsection (b)(2)(A), a plan amendment applicable to all individuals in one or more groups of similarly situated individuals under the plan and made effective no earlier than the first day of the first plan year after the amendment is adopted is not considered to be directed at any individual participants or beneficiaries.

 

iv)        This subsection (b)(2)(A) is illustrated by the examples appearing in 45 CFR 146.121(b)(2)(i)(D).

 

B)        Exception for Wellness Programs

A group health plan or group health insurance issuer may vary benefits, including cost-sharing mechanisms (such as a deductible, copayment or coinsurance), based on whether an individual has met the standards of a wellness program that satisfies the requirements of subsection (f).

 

C)        Specific Rule Relating to Source-of-Injury Exclusions

 

i)          If a group health plan or group health insurance coverage generally provides benefits for a type of injury, the plan or issuer may not deny benefits otherwise provided for treatment of the injury if the injury results from an act of domestic violence or a medical condition (including both physical and mental health conditions). This subsection (b)(2)(C)(i) applies in the case of an injury resulting from a medical condition even if the condition is not diagnosed before the injury.

 

ii)         This subsection (b)(2)(C) is illustrated by the examples appearing in 45 CFR 146.121(b)(2)(iii)(B).

 

3)         Relationship to 45 CFR 146.111

 

A)        A preexisting condition exclusion is permitted under this Section if it :

 

i)          Complies with 45 CFR 146.111;

 

ii)         Applies uniformly to all similarly situated individuals (as described in subsection (d)); and

 

iii)        Is not directed at individual participants or beneficiaries based on any health factor of the participants or beneficiaries. For purposes of this subsection (b)(3)(A)(iii), a plan amendment relating to a preexisting condition exclusion applicable to all individuals in one or more groups of similarly situated individuals under the plan and made effective no earlier than the first day of the first plan year after the amendment is adopted is not considered to be directed at any individual participants or beneficiaries. (45 CFR 146.121)

 

B)        This subsection (b)(3) is illustrated by the examples appearing in 45 CFR 146.121(b)(3)(ii).

 

c)         Prohibited Discrimination in Premiums or Contributions

 

1)         In General

 

A)        A group health plan, and a health insurance issuer offering health insurance coverage in connection with a group health plan, may not require an individual, as a condition of enrollment or continued enrollment under the plan or group health insurance coverage, to pay a premium or contribution that is greater than the premium or contribution for a similarly situated individual (described in subsection (d)) enrolled in the plan or group health insurance coverage based on any health factor that relates to the individual or a dependent of the individual.

 

B)        Discounts, rebates, payments in kind, and any other premium differential mechanisms are taken into account in determining an individual's premium or contribution rate. (For rules relating to cost-sharing mechanisms, see subsection (b)(2) (addressing benefits).)

 

2)         Rules Relating to Premium Rates

 

A)        Group Rating Based on Health Factors Not Restricted Under This Section

Nothing in this Section restricts the aggregate amount that an employer may be charged for coverage under a group health plan. But see 45 CFR 146.122(b), which prohibits adjustments in group premium or contribution rates based on genetic information.

 

B)        List Billing Based on a Health Factor Prohibited

However, a group health insurance issuer, or a group health plan, may not quote or charge an employer (or an individual) a different premium for an individual in a group of similarly situated individuals based on a health factor. (But see subsection (l) permitting favorable treatment of individuals with adverse health factors.)

 

C)        This subsection (c)(2) is illustrated by the examples appearing in 45 CFR 146.121(c)(2)(iii).

 

3)         Exception for Wellness Programs

Notwithstanding subsections (c)(1) and (c)(2), a plan or issuer may vary the amount of premium or contribution it requires similarly situated individuals to pay based on whether an individual has met the standards of a wellness program that satisfies the requirements of subsections (f) through (k). (45 CFR 146.121)

 

d)         Similarly Situated Individuals

The requirements of this Section apply only within a group of individuals who are treated as similarly situated individuals. A plan or issuer may treat participants as a group of similarly situated individuals separate from beneficiaries. In addition, participants may be treated as two or more distinct groups of similarly situated individuals and beneficiaries may be treated as two or more distinct groups of similarly situated individuals in accordance with this subsection (d). Moreover, if individuals have a choice of two or more benefit packages, individuals choosing one benefit package may be treated as one or more groups of similarly situated individuals distinct from individuals choosing another benefit package.

 

1)         Participants

Subject to subsection (d)(3), a plan or issuer may treat participants as two or more distinct groups of similarly situated individuals if the distinction between or among the groups of participants is based on a bona fide employment-based classification consistent with the employer's usual business practice. Whether an employment-based classification is bona fide is determined on the basis of all the relevant facts and circumstances. Relevant facts and circumstances include whether the employer uses the classification for purposes independent of qualification for health coverage (for example, determining eligibility for other employee benefits or determining other terms of employment). Subject to subsection (d)(3), examples of classifications that, based on all the relevant facts and circumstances, may be bona fide include full-time versus part-time status, different geographic location, membership in a collective bargaining unit, date of hire, length of service, current employee versus former employee status, and different occupations. However, a classification based on any health factor is not a bona fide employment-based classification unless the requirements of subsection (l) are satisfied (permitting favorable treatment of individuals with adverse health factors).

 

2)         Beneficiaries

 

A)        Subject to subsection (d)(3), a plan or issuer may treat beneficiaries as two or more distinct groups of similarly situated individuals if the distinction between or among the groups of beneficiaries is based on any of the following factors:

 

i)          A bona fide employment-based classification of the participant through whom the beneficiary is receiving coverage;

 

ii)         Relationship to the participant (for example, as a spouse or as a dependent child);

 

iii)        Marital status;

 

iv)        With respect to children of a participant, age or student status; or

 

v)         Any other factor if the factor is not a health factor.

 

B)        Subsection (d)(2)(A) does not prevent more favorable treatment of individuals with adverse health factors in accordance with subsection (g).

 

3)         Discrimination Directed at Individuals

Notwithstanding subsections (d)(1) and (d)(2), if the creation or modification of an employment or coverage classification is directed at individual participants or beneficiaries based on any health factor of the participants or beneficiaries, the classification is not permitted under this subsection (d) unless it is permitted under subsection (g) (permitting favorable treatment of individuals with adverse health factors). Thus, if an employer modified an employment-based classification to single out, based on a health factor, individual participants and beneficiaries and deny them health coverage, the new classification would not be permitted under this Section. (45 CFR 146.121)

 

4)         This subsection (d) is illustrated by the examples appearing at 45 CFR 146.121(d)(4).

 

e)         Nonconfinement and Actively-at-Work Provisions

 

1)         Nonconfinement Provisions

 

A)        General Rule

Under subsections (b) and (c), a plan or issuer may not establish a rule for eligibility (as described in subsection (b)(1)(B)) or set any individual's premium or contribution rate based on whether an individual is confined to a hospital or other health care institution. In addition, under subsections (b) and (c), a plan or issuer may not establish a rule for eligibility or set any individual's premium or contribution rate based on an individual's ability to engage in normal life activities, except to the extent permitted under subsections (e)(2)(B) and (e)(3) (permitting plans and issuers, under certain circumstances, to distinguish among employees based on the performance of services).

 

B)        Subsection (e)(1)(A) is illustrated by the examples appearing at 45 CFR 146.121(e)(1)(ii).

 

2)         Actively-at-Work and Continuous Service Provisions

 

A)        General Rule

 

i)          Under subsections (b) and (c) and subject to the exception for the first day of work described in subsection (e)(2)(B), a plan or issuer may not establish a rule for eligibility (as described in subsection (b)(1)(B)) or set any individual's premium or contribution rate based on whether an individual is actively at work (including whether an individual is continuously employed), unless absence from work due to any health factor (such as being absent from work on sick leave) is treated, for purposes of the plan or health insurance coverage, as being actively at work.

 

ii)         Subsection (e)(2)(A)(i) is illustrated by the examples appearing at 45 CFR 146.121(e)(2)(B).

 

B)        Exception for the First Day of Work

 

i)          Notwithstanding the general rule in subsection (e)(2)(A), a plan or issuer may establish a rule for eligibility that requires an individual to begin work for the employer sponsoring the plan (or, in the case of a multiemployer plan, to begin a job in covered employment) before coverage becomes effective, provided that such a rule for eligibility applies regardless of the reason for the absence.

 

ii)         This subsection (e)(2)(B) is illustrated by the examples appearing at 45 CFR 146.121(e)(2)(ii)(B).

 

3)         Relationship to Plan Provisions Defining Similarly Situated Individuals

 

A)        Notwithstanding subsection (e), a plan or issuer may establish rules for eligibility or set any individual's premium or contribution rate in accordance with the rules relating to similarly situated individuals in subsection (d). Accordingly, a plan or issuer may distinguish in rules for eligibility under the plan between full-time and part-time employees, between permanent and temporary or seasonal employees, between current and former employees, and between employees currently performing services and employees no longer performing services for the employer, subject to subsection (d). However, other federal or Illinois laws (including the COBRA continuation provisions and the Family and Medical Leave Act of 1993 (29 USC 2601 et seq.)) may require an employee or the employee's dependents to be offered coverage and set limits on the premium or contribution rate even though the employee is not performing services. (45 CFR 146.121)

 

B)        Subsection (e)(3)(A) is illustrated by the examples appearing at 45 CFR 146.121(e)(3)(ii).

 

f)         Nondiscriminatory Wellness Programs – In General

A wellness program is a program of health promotion or disease prevention. Subsections (b)(2)(B) and (c)(3) provide exceptions to the general prohibitions against discrimination based on a health factor for plan provisions that vary benefits (including cost-sharing mechanisms) or the premium or contribution for similarly situated individuals in connection with a wellness program that satisfies the requirements of subsections (f) through (k).  The following definitions govern in applying the provisions of subsections (f) through (k):

 

1)         Reward

Except where expressly provided otherwise, references in this Section to an individual obtaining a reward include both obtaining a reward (such as a discount or rebate of a premium or contribution, a waiver of all or part of a cost-sharing mechanism, an additional benefit, or any financial or other incentive) and avoiding a penalty (such as the absence of a premium surcharge or other financial or nonfinancial disincentive). References in this Section to a plan providing a reward include both providing a reward (such as a discount or rebate of a premium or contribution, a waiver of all or part of a cost-sharing mechanism, an additional benefit, or any financial or other incentive) and imposing a penalty (such as a surcharge or other financial or nonfinancial disincentive).

 

2)         Participatory Wellness Programs

If none of the conditions for obtaining a reward under a wellness program is based on an individual satisfying a standard that is related to a health factor (or if a wellness program does not provide a reward), the wellness program is a participatory wellness program. Examples of participatory wellness programs are:

 

A)        A program that reimburses employees for all or part of the cost for membership in a fitness center;

 

B)        A diagnostic testing program that provides a reward for participation in that program and does not base any part of the reward on outcomes;

 

C)        A program that encourages preventive care through the waiver of the copayment or deductible requirement under a group health plan for the costs of, for example, prenatal care or well-baby visits. (Note that, with respect to non-grandfathered plans, 45 CFR 147.130 requires benefits for certain preventive health services without the imposition of cost sharing.);

 

D)        A program that reimburses employees for the costs of participating, or that otherwise provides a reward for participating, in a smoking cessation program without regard to whether the employee quits smoking;

 

E)        A program that provides a reward to employees for attending a monthly, no-cost health education seminar; and

 

F)         A program that provides a reward to employees who complete a health risk assessment regarding current health status, without any further action (educational or otherwise) required by the employee with regard to the health issues identified as part of the assessment. (See also 45 CFR 146.122 for rules prohibiting collection of genetic information.)

 

3)         Health-Contingent Wellness Programs

A health-contingent wellness program is a program that requires an individual to satisfy a standard related to a health factor to obtain a reward (or requires an individual to undertake more than a similarly situated individual based on a health factor in order to obtain the same reward). A health-contingent wellness program may be an activity-only wellness program or an outcome-based wellness program.

 

4)         Activity-Only Wellness Programs

An activity-only wellness program is a type of health-contingent wellness program that requires an individual to perform or complete an activity related to a health factor in order to obtain a reward but does not require the individual to attain or maintain a specific health outcome. Examples include walking, diet or exercise programs, which some individuals may be unable to participate in or complete (or have difficulty participating in or completing) due to a health factor, such as severe asthma, pregnancy or a recent surgery. See subsection (h) for requirements applicable to activity-only wellness programs.

 

5)         Outcome-Based Wellness Programs

An outcome-based wellness program is a type of health-contingent wellness program that requires an individual to attain or maintain a specific health outcome (such as not smoking or attaining certain results on biometric screenings) in order to obtain a reward. To comply with the rules of subsections (f) through (k), an outcome-based wellness program typically has two tiers. That is, for individuals who do not attain or maintain the specific health outcome, compliance with an educational program or an activity may be offered as an alternative to achieve the same reward. This alternative pathway, however, does not mean that the overall program, which has an outcome-based component, is not an outcome-based wellness program. That is, if a measurement, test or screening is used as part of an initial standard and individuals who meet the standard are granted the reward, the program is considered an outcome-based wellness program. For example, if a wellness program tests individuals for specified medical conditions or risk factors (including biometric screening such as testing for high cholesterol, high blood pressure, abnormal body mass index, or high glucose level) and provides a reward to individuals identified as within a normal or healthy range for these medical conditions or risk factors, while requiring individuals who are identified as outside the normal or healthy range (or at risk) to take additional steps (such as meeting with a health coach, taking a health or fitness course, adhering to a health improvement action plan, complying with a walking or exercise program, or complying with a health care provider's plan of care) to obtain the same reward, the program is an outcome-based wellness program. See subsection (i) for requirements applicable to outcome-based wellness programs. (45 CFR 146.121)

 

g)         Requirement for Participatory Wellness Programs

A participatory wellness program, as described in subsection (f)(2), does not violate the provisions of this Section only if participation in the program is made available to all similarly situated individuals, regardless of health status.

 

h)         Requirements for Activity-Only Wellness Programs

A health-contingent wellness program that is an activity-only wellness program, as described in subsection (f)(4), does not violate the provisions of this Section only if all of the following requirements are satisfied:

 

1)         Frequency of Opportunity to Qualify

The program must give individuals eligible for the program the opportunity to qualify for the reward under the program at least once per year.

 

2)         Size of Reward

The reward for the activity-only wellness program, together with the reward for other health-contingent wellness programs with respect to the plan, must not exceed the applicable percentage (as defined in subsection (j)) of the total cost of employee-only coverage under the plan. However, if, in addition to employees, any class of dependents (such as spouses, or spouses and dependent children) may participate in the wellness program, the reward must not exceed the applicable percentage of the total cost of the coverage in which an employee and any dependents are enrolled. For purposes of this subsection (h)(2), the cost of coverage is determined based on the total amount of employer and employee contributions towards the cost of coverage for the benefit package under which the employee is (or the employee and any dependents are) receiving coverage.

 

3)         Reasonable Design

The program must be reasonably designed to promote health or prevent disease. A program satisfies this standard if it has a reasonable chance of improving the health of, or preventing disease in, participating individuals, and it is not overly burdensome, is not a subterfuge for discriminating based on a health factor, and is not highly suspect in the method chosen to promote health or prevent disease. This determination is based on all the relevant facts and circumstances.

 

4)         Uniform Availability and Reasonable Alternative Standards

The full reward under the activity-only wellness program must be available to all similarly situated individuals.

 

A)        Under this subsection (h)(4), a reward under an activity-only wellness program is not available to all similarly situated individuals for a period unless the program meets both of the following requirements:

 

i)          The program allows a reasonable alternative standard (or waiver of the otherwise applicable standard) for obtaining the reward for any individual for whom, for that period, it is unreasonably difficult due to a medical condition to satisfy the otherwise applicable standard; and

 

ii)         The program allows a reasonable alternative standard (or waiver of the otherwise applicable standard) for obtaining the reward for any individual for whom, for that period, it is medically inadvisable to attempt to satisfy the otherwise applicable standard.

 

B)        While plans and issuers are not required to determine a particular reasonable alternative standard in advance of an individual's request for one, if an individual is described in either subsection (h)(4)(A)(i) or (ii), a reasonable alternative standard must be furnished by the plan or issuer upon the individual's request or the condition for obtaining the reward must be waived.

 

C)        All the facts and circumstances are taken into account in determining whether a plan or issuer has furnished a reasonable alternative standard, including but not limited to the following:

 

i)          If the reasonable alternative standard is completion of an educational program, the plan or issuer must make the educational program available or assist the employee in finding such a program (instead of requiring an individual to find such a program unassisted), and may not require an individual to pay for the cost of the program;

 

ii)         The time commitment required must be reasonable (for example, requiring attendance nightly at a one-hour class would be unreasonable);

 

iii)        If the reasonable alternative standard is a diet program, the plan or issuer is not required to pay for the cost of food but must pay any membership or participation fee;

 

iv)        If an individual's personal physician states that a plan standard (including, if applicable, the recommendations of the plan's medical professional) is not medically appropriate for that individual, the plan or issuer must provide a reasonable alternative standard that accommodates the recommendations of the individual's personal physician with regard to medical appropriateness. Plans and issuers may impose standard cost sharing under the plan or coverage for medical items and services furnished pursuant to the physician's recommendations.

 

D)        To the extent that a reasonable alternative standard under an activity-only wellness program is, itself, an activity-only wellness program, it must comply with the requirements of this subsection (h) in the same manner as if it were an initial program standard. (Thus, for example, if a plan or issuer provides a walking program as a reasonable alternative standard to a running program, individuals for whom it is unreasonably difficult due to a medical condition to complete the walking program (or for whom it is medically inadvisable to attempt to complete the walking program) must be provided a reasonable alternative standard to the walking program.) To the extent that a reasonable alternative standard under an activity-only wellness program is, itself, an outcome-based wellness program, it must comply with the requirements of subsection (i), including subsection (i)(4)(D).

 

E)        If reasonable under the circumstances, a plan or issuer may seek verification, such as a statement from an individual's personal physician, that a health factor makes it unreasonably difficult for the individual to satisfy, or medically inadvisable for the individual to attempt to satisfy, the otherwise applicable standard of an activity-only wellness program. Plans and issuers may seek verification with respect to requests for a reasonable alternative standard for which it is reasonable to determine that medical judgment is required to evaluate the validity of the request.

 

5)         Notice of Availability of Reasonable Alternative Standard

The plan or issuer must disclose in all plan materials describing the terms of an activity-only wellness program the availability of a reasonable alternative standard to qualify for the reward (and, if applicable, the possibility of waiver of the otherwise applicable standard), including contact information for obtaining a reasonable alternative standard and a statement that recommendations of an individual's personal physician will be accommodated. If plan materials merely mention that such a program is available, without describing its terms, this disclosure is not required. Sample language is provided in subsection (k), as well as in certain examples of this Section. (45 CFR 146.121)

 

6)         The provisions of this subsection (h) are illustrated by the example appearing at 45 CFR 146.121(f)(4)(vi).

 

i)          Requirements for Outcome-Based Wellness Programs

A health-contingent wellness program that is an outcome-based wellness program, as described in subsection (f)(5), does not violate the provisions of this Section only if all of the following requirements are satisfied:

 

1)         Frequency of Opportunity to Qualify

The program must give individuals eligible for the program the opportunity to qualify for the reward under the program at least once per year.

 

2)         Size of Reward

The reward for the outcome-based wellness program, together with the reward for other health-contingent wellness programs with respect to the plan, must not exceed the applicable percentage (as defined in subsection (j)) of the total cost of employee-only coverage under the plan. However, if, in addition to employees, any class of dependents (such as spouses, or spouses and dependent children) may participate in the wellness program, the reward must not exceed the applicable percentage of the total cost of the coverage in which an employee and any dependents are enrolled. For purposes of this subsection (i)(2), the cost of coverage is determined based on the total amount of employer and employee contributions towards the cost of coverage for the benefit package under which the employee is (or the employee and any dependents are) receiving coverage.

 

3)         Reasonable Design

The program must be reasonably designed to promote health or prevent disease. A program satisfies this standard if it has a reasonable chance of improving the health of, or preventing disease in, participating individuals, and it is not overly burdensome, is not a subterfuge for discriminating based on a health factor, and is not highly suspect in the method chosen to promote health or prevent disease. This determination is based on all the relevant facts and circumstances. To ensure that an outcome-based wellness program is reasonably designed to improve health and does not act as a subterfuge for underwriting or reducing benefits based on a health factor, a reasonable alternative standard to qualify for the reward must be provided to any individual who does not meet the initial standard based on a measurement, test or screening that is related to a health factor, as explained in subsection (i)(4).

 

4)         Uniform Availability and Reasonable Alternative Standards

The full reward under the outcome-based wellness program must be available to all similarly situated individuals.

 

A)        Under this subsection (i)(4), a reward under an outcome-based wellness program is not available to all similarly situated individuals for a period unless the program allows a reasonable alternative standard (or waiver of the otherwise applicable standard) for obtaining the reward for any individual who does not meet the initial standard based on the measurement, test or screening, as described in this subsection (i)(4).

 

B)        While plans and issuers are not required to determine a particular reasonable alternative standard in advance of an individual's request for one, if an individual is described in subsection (i)(4)(A), a reasonable alternative standard must be furnished by the plan or issuer upon the individual's request or the condition for obtaining the reward must be waived.

 

C)        All the facts and circumstances are taken into account in determining whether a plan or issuer has furnished a reasonable alternative standard, including but not limited to the following:

 

i)          If the reasonable alternative standard is completion of an educational program, the plan or issuer must make the educational program available or assist the employee in finding such a program (instead of requiring an individual to find such a program unassisted), and may not require an individual to pay for the cost of the program.

 

ii)         The time commitment required must be reasonable (for example, requiring attendance nightly at a one-hour class would be unreasonable).

 

iii)        If the reasonable alternative standard is a diet program, the plan or issuer is not required to pay for the cost of food but must pay any membership or participation fee.

 

iv)        If an individual's personal physician states that a plan standard (including, if applicable, the recommendations of the plan's medical professional) is not medically appropriate for that individual, the plan or issuer must provide a reasonable alternative standard that accommodates the recommendations of the individual's personal physician with regard to medical appropriateness. Plans and issuers may impose standard cost sharing under the plan or coverage for medical items and services furnished pursuant to the physician's recommendations.

 

D)        To the extent that a reasonable alternative standard under an outcome-based wellness program is, itself, an activity-only wellness program, it must comply with the requirements of subsection (h) in the same manner as if it were an initial program standard. To the extent that a reasonable alternative standard under an outcome-based wellness program is, itself, another outcome-based wellness program, it must comply with the requirements of this subsection (i), subject to the following special rules:

 

i)          The reasonable alternative standard cannot be a requirement to meet a different level of the same standard without additional time to comply that takes into account the individual's circumstances. For example, if the initial standard is to achieve a BMI less than 30, the reasonable alternative standard cannot be to achieve a BMI less than 31 on that same date. However, if the initial standard is to achieve a BMI less than 30, a reasonable alternative standard for the individual could be to reduce the individual's BMI by a small amount or small percentage, over a realistic period of time, such as within a year.

 

ii)         An individual must be given the opportunity to comply with the recommendations of the individual's personal physician as a second reasonable alternative standard to meeting the reasonable alternative standard defined by the plan or issuer, but only if the physician joins in the request. The individual can make a request to involve a personal physician's recommendations at any time and the personal physician can adjust the physician's recommendations at any time, consistent with medical appropriateness.

 

E)        It is not reasonable to seek verification, such as a statement from an individual's personal physician, under an outcome-based wellness program that a health factor makes it unreasonably difficult for the individual to satisfy, or medically inadvisable for the individual to attempt to satisfy, the otherwise applicable standard as a condition of providing a reasonable alternative to the initial standard. However, if a plan or issuer provides an alternative standard to the otherwise applicable measurement, test or screening that involves an activity that is related to a health factor, then the rules of subsection (h) for activity-only wellness programs apply to that component of the wellness program and the plan or issuer may, if reasonable under the circumstances, seek verification that it is unreasonably difficult due to a medical condition for an individual to perform or complete the activity (or it is medically inadvisable to attempt to perform or complete the activity). (For example, if an outcome-based wellness program requires participants to maintain a certain healthy weight and provides a diet and exercise program for individuals who do not meet the targeted weight, a plan or issuer may seek verification, as described in subsection (i)(4)(D), if reasonable under the circumstances, that a second reasonable alternative standard is needed for certain individuals because, for those individuals, it would be unreasonably difficult due to a medical condition to comply, or medically inadvisable to attempt to comply, with the diet and exercise program, due to a medical condition.)

 

5)         Notice of Availability of Reasonable Alternative Standard

The plan or issuer must disclose in all plan materials describing the terms of an outcome-based wellness program, and in any disclosure that an individual did not satisfy an initial outcome-based standard, the availability of a reasonable alternative standard to qualify for the reward (and, if applicable, the possibility of waiver of the otherwise applicable standard), including contact information for obtaining a reasonable alternative standard and a statement that recommendations of an individual's personal physician will be accommodated. If plan materials merely mention that such a program is available, without describing its terms, this disclosure is not required. Sample language is provided in subsection (k), as well as in certain examples of this Section. (45 CFR 146.121)

 

6)         This subsection (i) is illustrated by the examples at 45 CFR 146.121(f)(4).

 

j)          Applicable Percentage

For purposes of subsections (f) through (k), the applicable percentage is provided

in Section 356z.17(e)(iii) of the Code.

 

k)         Sample Language

The following language, or substantially similar language, can be used to satisfy the notice requirement of subsection (h)(5) or (i)(5): "Your health plan is committed to helping you achieve your best health. Rewards for participating in a wellness program are available to all employees. If you think you might be unable to meet a standard for a reward under this wellness program, you might qualify for an opportunity to earn the same reward by different means. Contact us at [insert contact information] and we will work with you (and, if you wish, with your doctor) to find a wellness program with the same reward that is right for you in light of your health status." (45 CFR 146.121)

 

l)          More Favorable Treatment of Individuals with Adverse Health Factors Permitted

 

1)         In Rules for Eligibility

 

A)        Nothing in this Section prevents a group health plan or group health insurance issuer from establishing more favorable rules for eligibility (described in subsection (b)(1)) for individuals with an adverse health factor, such as disability, than for individuals without the adverse health factor. Moreover, nothing in this Section prevents a plan or issuer from charging a higher premium or contribution with respect to individuals with an adverse health factor if they would not be eligible for the coverage were it not for the adverse health factor. (However, other laws, including Illinois insurance laws, may set or limit premium rates; these laws are not affected by this Section.)

 

B)        This subsection (l)(1) is illustrated by the examples appearing at 45 CFR 146.121(g)(1)(ii).

 

2)         In Premiums or Contributions

 

A)        Nothing in this Section prevents a group health plan or group health insurance issuer from charging individuals a premium or contribution that is less than the premium (or contribution) for similarly situated individuals if the lower charge is based on an adverse health factor, such as disability. (45 CFR 146.121)

 

B)        This subsection (l)(2) is illustrated by the examples appearing at 45 CFR 146.121(g)(2)(ii).

 

m)        No Effect on Other Laws

Compliance with this Section is not determinative of compliance with any other provision of the PHS Act (including the COBRA continuation provisions) or any other Illinois or federal law, such as the Americans With Disabilities Act. Therefore, although this Section would not prohibit a plan or issuer from treating one group of similarly situated individuals differently from another (such as providing different benefit packages to current and former employees), other federal or Illinois laws may require that two separate groups of similarly situated individuals be treated the same for certain purposes (such as making the same benefit package available to COBRA qualified beneficiaries as is made available to active employees). In addition, although this Section generally does not impose new disclosure obligations on plans and issuers, this Section does not affect any other laws, including those that require accurate disclosures and prohibit intentional misrepresentation. (45 CFR 146.121)

 

n)         Applicability Dates

 

1)         Generally

This Section applies for plan years beginning on or after July 1, 2007.

 

2)         Special Rule for Self-Funded Nonfederal Governmental Plans Exempted Under 45 CFR 146.180

 

A)        If coverage has been denied to any individual because the sponsor of a self-funded nonfederal governmental plan has elected under 45 CFR 146.180 to exempt the plan from the requirements of this Section, and the plan sponsor subsequently chooses to bring the plan into compliance with the requirements of this Section, the plan:

 

i)          Must notify the individual that the plan will be coming into compliance with the requirements of this Section, specify the effective date of compliance, and inform the individual regarding any enrollment restrictions that may apply under the terms of the plan once the plan is in compliance with this Section (as a matter of administrative convenience, the notice may be disseminated to all employees);

 

ii)         Must give the individual an opportunity to enroll that continues for at least 30 days;

 

iii)        Must permit coverage to be effective as of the first day of plan coverage for which an exemption election under 45 CFR 146.180 (with regard to this Section) is no longer in effect; and

 

iv)        May not treat the individual as a late enrollee or a special enrollee.

 

B)        For purposes of this subsection (n)(2), an individual is considered to have been denied coverage if the individual failed to apply for coverage because, given an exemption election under 45 CFR 146.180, it was reasonable to believe that an application for coverage would have been denied based on a health factor. (45 CFR 146.121)

 

C)        This subsection (n)(2) is illustrated by the examples appearing at 45 CFR 146.121(i)(2)(iii).

 

(Source:  Amended at 45 Ill. Reg. 11816, effective September 17, 2021)

 

Section 2001.10  Summary of Benefits and Coverage and Uniform Glossary

 

a)         Summary of Benefits and Coverage in General

A group health plan (and its administrator as defined in section 3(16)(A) of ERISA), and a health insurance issuer offering group or individual health insurance coverage, is required to file for the Director's approval prior to use a written summary of benefits and coverage (SBC) for each benefit package and provide the SBC without charge to entities and individuals described in this subsection (a) in accordance with this Section.

 

1)         SBC Provided by a Group Health Insurance Issuer to a Group Health Plan

 

A)        Upon Application

A health insurance issuer offering group health insurance coverage must provide the SBC to a group health plan (or its sponsor) upon application for health coverage, as soon as practicable following receipt of the application, but in no event later than seven business days following receipt of the application.

 

B)        By First Day of Coverage (If There Are Changes)

If there is any change in the information required to be in the SBC that was provided upon application and before the first day of coverage, the issuer must update and provide a current SBC to the plan (or its sponsor) no later than the first day of coverage.

 

C)        Upon Renewal

If the issuer renews or reissues the policy, certificate or contract of insurance (for example, for a succeeding policy year), the issuer must provide a new SBC as follows:

 

i)          If written application is required (in either paper or electronic form) for renewal or reissuance, the SBC must be provided no later than the date the written application materials are distributed.

 

ii)         If renewal or reissuance is automatic, the SBC must be provided no later than 30 days prior to the first day of the new plan or policy year; however, with respect to an insured plan, if the policy, certificate or contract of insurance has not been issued or renewed before such 30-day period, the SBC must be provided as soon as practicable but in no event later than seven business days after issuance of the new policy, certificate or contract of insurance, or the receipt of written confirmation of intent to renew, whichever is earlier.

 

D)        Upon Request

If a group health plan (or its sponsor) requests an SBC or summary information about a health insurance product from a health insurance issuer offering group health insurance coverage, an SBC must be provided as soon as practicable, but in no event later than seven business days following receipt of the request.

 

2)         SBC Provided by a Group Health Insurance Issuer and a Group Health Plan to Participants and Beneficiaries

 

A)        In General

A group health plan (including its administrator, as defined under section 3(16) of ERISA), and a health insurance issuer offering group health insurance coverage, must provide an SBC to a participant or beneficiary (as defined under sections 3(7) and 3(8) of ERISA), and consistent with subsection (a)(3) of this Section, with respect to each benefit package offered by the plan or issuer for which the participant or beneficiary is eligible.

 

B)        Upon Application

The SBC must be provided as part of any written application materials that are distributed by the plan or issuer for enrollment. If the plan or issuer does not distribute written application materials for enrollment, the SBC must be distributed no later than the first date on which the participant is eligible to enroll in coverage for the participant or any beneficiaries.

 

C)        By First Day of Coverage (If There Are Changes)

If there is any change to the information required to be in the SBC that was provided upon application and before the first day of coverage, the plan or issuer must update and provide a current SBC to a participant or beneficiary no later than the first day of coverage.

 

D)        Special Enrollees

The plan or issuer must provide the SBC to special enrollees (as described in 45 CFR 146.117) no later than the date by which a summary plan description is required to be provided under the timeframe set forth in ERISA section 104(b)(1)(A), which is 90 days from enrollment.

 

E)        Upon Renewal

If the plan or issuer requires participants or beneficiaries to renew in order to maintain coverage (for example, for a succeeding plan year), the plan or issuer must provide a new SBC when the coverage is renewed, as follows:

 

i)          If written application is required for renewal (in either paper or electronic form), the SBC must be provided no later than the date on which the written application materials are distributed.

 

ii)         If renewal is automatic, the SBC must be provided no later than 30 days prior to the first day of the new plan or policy year; however, with respect to an insured plan, if the policy, certificate, or contract of insurance has not been issued or renewed before such 30-day period, the SBC must be provided as soon as practicable but in no event later than seven business days after issuance of the new policy, certificate or contract of insurance, or the receipt of written confirmation of intent to renew, whichever is earlier.

 

F)         Upon Request

A plan or issuer must provide the SBC to participants or beneficiaries upon request for an SBC or summary information about the health coverage, as soon as practicable, but in no event later than seven business days following receipt of the request.

 

3)         Special Rules to Prevent Unnecessary Duplication with Respect to Group Health Coverage

 

A)        An entity required to provide an SBC under subsection (a) with respect to an individual satisfies that requirement if another party provides the SBC, but only to the extent that the SBC is timely and complete in accordance with this Section. Therefore, for example, in the case of a group health plan funded through an insurance policy, the plan satisfies the requirement to provide an SBC with respect to an individual if the issuer provides a timely and complete SBC to the individual.

 

B)        If a single SBC is provided to a participant and any beneficiaries at the participant's last known address, then the requirement to provide the SBC to the participant and any beneficiaries is generally satisfied. However, if a beneficiary's last known address is different than the participant's last known address, a separate SBC is required to be provided to the beneficiary at the beneficiary's last known address.

 

C)        With respect to a group health plan that offers multiple benefit packages, the plan or issuer is required to provide a new SBC automatically upon renewal only with respect to the benefit package in which a participant or beneficiary is enrolled; SBCs are not required to be provided automatically upon renewal with respect to benefit packages in which the participant or beneficiary is not enrolled. However, if a participant or beneficiary requests an SBC with respect to another benefit package (or more than one other benefit package) for which the participant or beneficiary is eligible, the SBC (or SBCs, in the case of a request for SBCs relating to more than one benefit package) must be provided upon request as soon as practicable, but in no event later than seven business days following receipt of the request.

 

4)         SBC Provided by a Health Insurance Issuer Offering Individual Health Insurance Coverage

 

A)        Upon Application

A health insurance issuer offering individual health insurance coverage must provide an SBC to an individual covered under the policy (including every dependent) upon receiving an application for any health insurance policy, as soon as practicable following receipt of the application, but in no event later than seven business days following receipt of the application.

 

B)        By First Day of Coverage (If There Are Changes)

If there is any change in the information required to be in the SBC that was provided upon application and before the first day of coverage, the issuer must update and provide a current SBC to the individual no later than the first day of coverage.

 

C)        Upon Renewal

The issuer must provide the SBC to policyholders annually at renewal. The SBC must reflect any modified policy terms that would be effective on the first day of the new policy year. The SBC must be provided as follows:

 

i)          If written application is required (in either paper or electronic form) for renewal or reissuance, the SBC must be provided no later than the date on which the written application materials are distributed.

 

ii)         If renewal or reissuance is automatic, the SBC must be provided no later than 30 days prior to the first day of the new policy year; however, if the policy, certificate or contract of insurance has not been issued or renewed before such 30-day period, the SBC must be provided as soon as practicable but in no event later than seven business days after issuance of the new policy, certificate or contract of insurance, or the receipt of written confirmation of intent to renew, whichever is earlier.

 

D)        Upon Request

A health insurance issuer offering individual health insurance coverage must provide an SBC to any individual or dependent anytime an individual requests an SBC or summary information about a health insurance product as soon as practicable, but in no event later than seven business days following receipt of the request. For purposes of this subsection (a)(4)(D), a request for an SBC or summary information about a health insurance product includes a request made both before and after an individual submits an application for coverage.

 

5)         Special Rule to Prevent Unnecessary Duplication with Respect to Individual Health Insurance Coverage

If a single SBC is provided to an individual and any dependents at the individual's last known address, then the requirement to provide the SBC to the individual and any dependents is generally satisfied. However, if a dependent's last known address is different than the individual's last known address, a separate SBC is required to be provided to the dependent at the dependent's last known address.

 

b)         Summary of Benefits and Coverage − Content

 

1)         In General

Subject to subsection (b)(3), the SBC must include the following:

 

A)        Uniform definitions of standard insurance terms and medical terms so that consumers may compare health coverage and understand the terms of (or exceptions to) their coverage;

 

B)        A description of the coverage, including cost sharing, for each category of benefits;

 

C)        The exceptions, reductions and limitations of the coverage;

 

D)        The cost-sharing provisions of the coverage, including deductible, coinsurance and copayment obligations;

 

E)        The renewability and continuation of coverage provisions;

 

F)         Coverage examples, in accordance with subsection (b)(2);

 

G)        With respect to coverage beginning on or after January 1, 2014, a statement about whether the plan or coverage provides minimum essential coverage as defined under section 5000A(f) of the Internal Revenue Code (26 USC 5000A(f)) and whether the plan's or coverage's share of the total allowed costs of benefits provided under the plan or coverage meets applicable requirements;

 

H)        A statement that the SBC is only a summary and that the plan document or the policy, certificate or contract of insurance should be consulted to determine the governing contractual provisions of the coverage;

 

I)         Contact information for questions and obtaining a copy of the plan document or the insurance policy, certificate or contract of insurance (such as a telephone number for customer service and an Internet address for obtaining a copy of the plan document or the insurance policy, certificate or contract of insurance);

 

J)         For plans and issuers that maintain one or more networks of providers, an Internet address (or similar contact information) for obtaining a list of network providers;

 

K)        For plans and issuers that use a formulary in providing prescription drug coverage, an Internet address (or similar contact information) for obtaining information on prescription drug coverage; and

 

L)        An Internet address for obtaining the uniform glossary, as described in subsection (c), as well as a contact phone number to obtain a paper copy of the uniform glossary, and a disclosure that paper copies are available.

 

2)         Coverage Examples

The SBC must include coverage examples that illustrate benefits provided under the plan or coverage for common benefits scenarios (including pregnancy and serious or chronic medical conditions) in accordance with this subsection (b)(2).

 

A)        Number of Examples

The Secretary may identify up to six coverage examples that may be required in an SBC.

 

B)        Benefits Scenarios

For purposes of this subsection (b)(2), a benefits scenario is a hypothetical situation, consisting of a sample treatment plan for a specified medical condition during a specific period of time, based on recognized clinical practice guidelines as defined by the National Guideline Clearinghouse, Agency for Healthcare Research and Quality.

 

C)        Illustration of Benefit Provided

For purposes of this subsection (b)(2), to illustrate benefits provided under the plan or coverage for a particular benefits scenario, a plan or issuer simulates claims processing to generate an estimate of what an individual might expect to pay under the plan, policy or benefit package. The illustration of benefits provided will take into account any cost sharing, excluded benefits, and other limitations on coverage.

 

3)         Coverage Provided Outside the United States

In lieu of summarizing coverage for items and services provided outside the United States, a plan or issuer may provide an Internet address (or similar contact information) for obtaining information about benefits and coverage provided outside the United States. In any case, the plan or issuer must provide an SBC in accordance with this Section that accurately summarizes benefits and coverage available under the plan or coverage within the United States.  (45 CFR 147.200)

 

c)         Summary of Benefits and Coverage − Appearance

The SBC must be presented in a uniform format, use terminology understandable by the average plan enrollee (or, in the case of individual market coverage, the average individual covered under a health insurance policy), not exceed four double-sided pages in length, and not include print smaller than 12-point font. A health insurance issuer offering individual health insurance coverage must provide the SBC as a stand-alone document.  (45 CFR 147.200)

 

d)         Summary of Benefits and Coverage – Form

 

1)         An SBC provided by an issuer offering group health insurance coverage to a plan (or its sponsor) may be provided in paper form. Alternatively, the SBC may be provided electronically (such as by email or an Internet posting) if the following three conditions are satisfied:

 

A)        The format is readily accessible by the plan (or its sponsor);

 

B)        The SBC is provided in paper form free of charge upon request; and

 

C)        If the electronic form is an Internet posting, the issuer timely advises the plan (or its sponsor) in paper form or email that the documents are available on the Internet and provides the Internet address.

 

2)         An SBC provided by a group health plan or health insurance issuer to a participant or beneficiary may be provided in paper form. Alternatively, for non-federal governmental plans, the SBC may be provided electronically if the plan conforms to either the substance of the ERISA provisions at 29 CFR 2590.715-2715(a)(4)(ii), or the provisions governing electronic disclosure for individual health insurance issuers set forth in subsection (d)(3).

 

3)         An issuer offering individual health insurance coverage must provide an SBC in a manner that can reasonably be expected to provide actual notice in paper or electronic form.

 

A)        An issuer satisfies the requirements of subsection (d)(3) if the issuer:

 

i)          Hand-delivers a printed copy of the SBC to the individual or dependent;

 

ii)         Mails a printed copy of the SBC to the mailing address provided to the issuer by the individual or dependent;

 

iii)        Provides the SBC by email after obtaining the individual's or dependent's agreement to receive the SBC or other electronic disclosures by email;

 

iv)        Posts the SBC on the Internet and advises the individual or dependent in paper or electronic form, in a manner compliant with subsections (d)(3)(A)(i) through (iii), that the SBC is available on the Internet and includes the applicable Internet address; or

 

v)         Provides the SBC by any other method that can reasonably be expected to provide actual notice.

 

B)        An SBC may not be provided electronically unless:

 

i)          The format is readily accessible;

 

ii)         The SBC is placed in a location that is prominent and readily accessible;

 

iii)        The SBC is provided in an electronic form that can be electronically retained and printed;

 

iv)        The SBC is consistent with the appearance, content and language requirements of this Section;

 

v)         The issuer notifies the individual or dependent that the SBC is available in paper form without charge upon request and provides it upon request.

 

C)        Deemed Compliance

A health insurance issuer offering individual health insurance coverage that provides the content required under subsection (b) to the federal health reform Web portal described in 45 CFR 159.120 will be deemed to satisfy the requirements of subsection (a)(4)(D) with respect to a request for summary information about a health insurance product made prior to an application for coverage. However, nothing in this subsection (d)(3)(D) should be construed as otherwise limiting such issuer's obligations under this Section.  (45 CFR 147.200)

 

e)         Summary of Benefits and Coverage – Language

A group health plan or health insurance issuer must provide the SBC in a culturally and linguistically appropriate manner. For purposes of this subsection, a plan or issuer is considered to provide the SBC in a culturally and linguistically appropriate manner if the thresholds and standards of 45 CFR 147.136(e) are met as applied to the SBC. (45 CFR 147.200)

 

f)         Notice of Modification

If a group health plan, or health insurance issuer offering group or individual health insurance coverage, makes any material modification (as defined under section 102 of ERISA) in any of the terms of the plan or coverage that would affect the content of the SBC, that is not reflected in the most recently provided SBC, and that occurs other than in connection with a renewal or reissuance of coverage, the plan or issuer must provide notice of the modification to enrollees (or, in the case of individual market coverage, an individual covered under a health insurance policy) not later than 60 days prior to the date on which the modification will become effective. The notice of modification must be provided in a form that is consistent with subsection (d). (45 CFR 147.200)

 

g)         Uniform Glossary

 

1)         In General

A group health plan, and a health insurance issuer offering group health insurance coverage, must make available to participants and beneficiaries, and a health insurance issuer offering individual health insurance coverage must make available to applicants, policyholders and covered dependents, the uniform glossary described in subsection (g)(2) in accordance with the appearance and form and manner requirements of subsections (g)(3) and (g)(4).

 

2)         Health-Coverage-Related Terms and Medical Terms

The uniform glossary must provide uniform definitions of the following health-coverage-related terms and medical terms:

 

A)        Allowed amount, appeal, balance billing, co-insurance, complications of pregnancy, co-payment, deductible, durable medical equipment, emergency medical condition, emergency medical transportation, emergency room care, emergency services, excluded services, grievance, habilitation services, health insurance, home health care, hospice services, hospitalization, hospital outpatient care, in-network co-insurance, in-network co-payment, medically necessary, network, non-preferred provider, out-of-network co-insurance, out-of-network co-payment, out-of-pocket limit, physician services, plan, preauthorization, preferred provider, premium, prescription drug coverage, prescription drugs, primary care physician, primary care provider, provider, reconstructive surgery, rehabilitation services, skilled nursing care, specialist, usual customary and reasonable (UCR), and urgent care; and

 

B)        Such other terms as the Secretary determines are important to define so that individuals and employers may compare and understand the terms of coverage and medical benefits (including any exceptions to those benefits).

 

3)         Appearance

A group health plan, and a health insurance issuer, must ensure the uniform glossary is presented in a uniform format and uses terminology understandable by the average plan enrollee (or, in the case of individual market coverage, an average individual covered under a health insurance policy).

 

4)         Form and Manner

A plan or issuer must make the uniform glossary described in subsection (g) available upon request, in either paper or electronic form (as requested), within seven business days after receipt of the request.  (45 CFR 147.200)

 

h)         Preemption

For purposes of this Section, the provisions of PHS Act section 2724 continue to apply with respect to preemption of Illinois law. In addition, Illinois laws that require a health insurance issuer to provide an SBC that supplies less information than required under subsections (a), (b), (c), (d) and (e) are preempted by federal law.  (45 CFR 147.200)

 

i)          Failure to Provide

A health insurance issuer or a non-federal governmental health plan that willfully fails to provide information required under this Section is subject to a fine of not more than $1,000 for each such failure. A failure with respect to each covered individual constitutes a separate offense for purposes of this subsection (i). The Department and HHS will enforce these provisions in a manner consistent with 45 CFR 150.101 through 150.465.  (45 CFR 147.200)

 

j)          Applicability Date

 

1)         This Section is applicable to group health plans and group health insurance issuers in accordance with this subsection (j). (See 45 CFR 147.140(d), providing that this Section applies to grandfathered health plans.)

 

A)        For disclosures with respect to participants and beneficiaries who enroll or re-enroll through an open enrollment period (including re-enrollees and late enrollees), this Section applies beginning on the first day of the first open enrollment period that begins on or after September 23, 2012; and

 

B)        For disclosures with respect to participants and beneficiaries who enroll in coverage other than through an open enrollment period (including individuals who are newly eligible for coverage and special enrollees), this Section applies beginning on the first day of the first plan year that begins on or after September 23, 2012.

 

2)         For disclosures with respect to plans, and to individuals and dependents in the individual market, this Section is applicable to health insurance issuers beginning September 23, 2012. (45 CFR 147.200)

 

(Source:  Old Section 2001.10 renumbered to Section 2001.110 and new Section 2001.10 added at 38 Ill. Reg. 2037, effective January 2, 2014)

 

Section 2001.11  Essential Health Benefits

 

a)         Coverage for Essential Health Benefits Package

 

1)         A health insurance issuer that offers health insurance coverage in the individual or small group market shall ensure that the coverage includes an essential health benefits (EHB) package in accordance with the requirements in subsections (b) and (c). (See 42 USC 300gg-6(a).)

 

2)         The provisions of this Section regarding the inclusion of essential pediatric oral care benefits shall be deemed to be satisfied for qualified health plans made available in the small group market or individual market in Illinois outside the Health Benefits Exchange, issued for policy or plan years beginning on or after January 1, 2015, that do not include the essential pediatric oral care benefits if the health insurance issuer has obtained reasonable assurance that the pediatric oral care benefits are provided to the purchaser or enrollee of the qualified health plan. The health insurance issuer shall be deemed to have obtained reasonable assurance that the pediatric oral care benefits are provided to the purchaser of the qualified health plan if:

 

A)        At least one Exchange certified stand-alone dental plan that offers the minimum essential pediatric oral care benefits that are required under subsection (c)(1)(J) and it is available for purchase by the small group or individual purchaser;

 

B)        The health insurance issuer prominently discloses to the purchaser, or enrollee in the case of a group plan, in a form approved by the Director, at the time that it offers the qualified health plan, that the plan does not provide the essential pediatric oral care benefits; and

 

C)        The health insurance issuer has received and kept records of written, verbal or electronic confirmation from the purchaser, or enrollee in the case of a group plan, that he or she has obtained, or is obtaining, other coverage that includes essential pediatric oral care benefits.

 

b)         Essential Health Benefits Package

In this Section, the term "essential health benefits package" means, with respect to any health plan, coverage that:

 

1)         provides for the essential health benefits defined under subsection (c);

 

2)         limits cost-sharing for such coverage in accordance with Section 2001.12(a); and

 

3)         subject to Section 2001.12(i), provides either the bronze, silver, gold or platinum level of coverage described in Section 2001.12(b). (See 42 USC 18022(a) and (b).)

 

c)         Essential Health Benefits

 

1)         In General

Subject to subsection (c)(2), essential health benefits shall include at least the following general categories and the items and services covered within the categories:

 

A)        Ambulatory patient services;

 

B)        Emergency services;

 

C)        Hospitalization;

 

D)        Maternity and newborn care;

 

E)        Mental health and substance use disorder services, including behavioral health treatment;

 

F)         Prescription drugs;

 

G)        Rehabilitative and habilitative services and devices;

 

H)        Laboratory services;

 

I)         Preventive and wellness services and chronic disease management; and

 

J)         Pediatric services, including oral and vision care. (See 42 USC 18022(a) and (b).)

 

2)         Specific Requirements

Essential health benefits shall include:

 

A)        For plan years 2017-2019, those specific benefits and limits described in the Illinois EHB Benchmark Plan selected from the Blue Cross Blue Shield of Illinois plan in the Small Group Market designated "Blue PPO Gold 011", published by the Centers for Medicare & Medicaid Services, 7500 Security Boulevard, Baltimore, Maryland 21244 (http://www.cms.gov/CCIIO/

Resources/Data-Resources/Downloads/IL-BMP.zip). 

 

B)        For plan years 2020 onward, those specific benefits and limits described in the Illinois EHB Benchmark Plan designated "The Access to Care and Treatment Plan", published by the Centers for Medicare & Medicaid Services, 7500 Security Boulevard, Baltimore, Maryland 21244  (http://www.cms.gov/CCIIO/

Resources/Data-Resources/Downloads/2020-BPM-IL.zip).

 

This subsection (c)(2) does not include any later amendments or editions, if any, to the Illinois EHB Benchmark Plans.

 

(Source:  Amended at 43 Ill. Reg. 9378, effective August 26, 2019)

 

Section 2001.12  Cost-Sharing

 

a)         Cost-Sharing Under Group Health Plans

A group health plan shall ensure that any annual cost-sharing imposed under the plan does not exceed the limitations provided for under subsections (a)(1) and (2). (See 42 USC 300gg-6(b).)  Requirements relating to cost-sharing are:

 

1)         Annual Limitation on Cost-Sharing

 

A)        2014

The cost-sharing incurred under a health plan with respect to self-only coverage or coverage other than self-only coverage for a plan year beginning in 2014 shall not exceed the dollar amounts in effect under 26 USC 223(c)(2)(A)(ii) for self-only and family coverage, respectively, for taxable years beginning in 2014.

 

B)        2015 and Later

In the case of any plan year beginning in a calendar year after 2014, the limitation under this subsection (a)(1)(B) shall:

 

i)          in the case of self-only coverage, be equal to the dollar amount under subsection (a)(1)(A) for self-only coverage for plan years beginning in 2014, increased by an amount equal to the product of that amount and the premium adjustment percentage under subsection (a)(4) for the calendar year; and

 

ii)         in the case of other coverage, twice the amount in effect under subsection (a)(1)(B)(i).

 

C)        If the amount of any increase under subsection (a)(1)(B)(i) is not a multiple of $50, such increase shall be rounded to the next lowest multiple of $50.

 

2)         Annual Limitation on Deductibles for Employer-Sponsored Plans

 

A)        In General

 

i)          In the case of a health plan offered in the small group market, the deductible under the plan shall not exceed $2,000 in the case of a plan covering a single individual and $4,000 in the case of any other plan.

 

ii)         The amounts under subsection (a)(3)(A)(i) may be increased by the maximum amount of reimbursement that is reasonably available to a participant under a flexible spending arrangement described in 26 USC 106(c)(2) (determined without regard to any salary reduction arrangement).

 

B)        Indexing of Limits

In the case of any plan year beginning in a calendar year after 2014:

 

i)          the dollar amount under subsection (a)(1)(A)(i) shall be increased by an amount equal to the product of that amount and the premium adjustment percentage under subsection (a)(4) for the calendar year; and if the amount of any increase under subsection (a)(2)(B)(i) is not a multiple of $50, such increase shall be rounded to the next lowest multiple of $50.

 

ii)         the dollar amount under subsection (a)(1)(A)(ii) shall be increased to an amount equal to twice the amount in effect under subsection (a)(1)(A)(i) for plan years beginning in the calendar year, determined after application of subsection (a)(2)(B)(i).

 

C)        Actuarial Value

The limitation under this subsection (a) shall be applied in such a manner so as to not affect the actuarial value of any health plan, including a plan in the bronze level.

 

D)        Coordination with Preventive Limits

Nothing in this subsection (a) shall be construed to allow a plan to have a deductible under the plan apply to benefits described in section 2713 of the federal Public Health Service Act (45 CFR 130).

 

3)         Cost-Sharing

 

A)        In general, the term "cost-sharing" in this Section includes:

 

i)          deductibles, coinsurance, copayments or similar charges; and

 

ii)         any other expenditure required of an insured individual that is a qualified medical expense (within the meaning of 26 USC 223(d)(2)) with respect to EHB covered under the plan.

 

B)        Exceptions

The term "cost-sharing" in this Section does not include premiums, balance billing amounts for non-network providers, or spending for non-covered services.

 

4)         Premium Adjustment Percentage

For purposes of subsections (a)(1)(B)(i) and (a)(2)(B)(i), the premium adjustment percentage for any calendar year is the percentage (if any) by which the average per capita premium for health insurance coverage in the United States for the preceding calendar year (as estimated by the Secretary no later than October 1 of such preceding calendar year) exceeds such average per capita premium for 2013 (as determined by the Secretary). (See 42 USC 18022(c).)

 

b)         Levels of Coverage

The levels of coverage described in this subsection (b) are as follows:

 

1)         Bronze Level

A plan in the bronze level shall provide a level of coverage that is designed to provide benefits that are actuarially equivalent to 60 percent of the full actuarial value of the benefits provided under the plan.

 

2)         Silver Level

A plan in the silver level shall provide a level of coverage that is designed to provide benefits that are actuarially equivalent to 70 percent of the full actuarial value of the benefits provided under the plan.

 

3)         Gold Level

A plan in the gold level shall provide a level of coverage that is designed to provide benefits that are actuarially equivalent to 80 percent of the full actuarial value of the benefits provided under the plan.

 

4)         Platinum Level

A plan in the platinum level shall provide a level of coverage that is designed to provide benefits that are actuarially equivalent to 90 percent of the full actuarial value of the benefits provided under the plan. (See 42 USC 18022(d).)

 

c)         Actuarial Value (AV) Calculation for Determining Level of Coverage

 

1)         Calculation of AV

Subject to subsection (c)(2), to calculate the AV of a health plan, the issuer must use the AV Calculator developed and made available by HHS.

 

2)         Exception to the Use of the AV Calculator

If a health plan's design is not compatible with the AV Calculator, the issuer must meet the following:

 

A)        Submit the actuarial certification from an actuary, who is a member of the American Academy of Actuaries, on the chosen methodology identified in subsection (c)(2)(B) or (C).

 

B)        Calculate the plan's AV by:

 

i)          Estimating a fit of its plan design into the parameters of the AV Calculator; and

 

ii)         Having an actuary, who is a member of the American Academy of Actuaries, certify that the plan design was fit appropriately in accordance with generally accepted actuarial principles and methodologies.

 

C)        Use the AV Calculator to determine the AV for the plan provisions that fit within the calculator parameters and have an actuary, who is a member of the American Academy of Actuaries, calculate and certify, in accordance with generally accepted actuarial principles and methodologies, appropriate adjustments to the AV identified by the calculator, for plan design features that deviate substantially from the parameters of the AV Calculator.

 

D)        The calculation methods described in subsections (c)(2)(B) and (C) may include only in-network cost-sharing, including multi-tier networks.

 

3)         Employer Contributions to Health Savings Accounts and Amounts Made Available Under Certain Health Reimbursement Arrangements

For plans other than those in the individual market that at the time of purchase are offered in conjunction with a Health Savings Account (HSA) or with integrated Health Reimbursement Accounts (HRAs) that may be used only for cost-sharing, annual employer contributions to HSAs and amounts newly made available under such HRAs for the current year are:

 

A)        Counted towards the total anticipated medical spending of the standard population that is paid by the health plan; and

 

B)        Adjusted to reflect the expected spending for health care costs in a benefit year so that:

 

i)          Any current year HSA contributions are accounted for; and

 

ii)         The amounts newly made available under such integrated HRAs for the current year are accounted for.

 

4)         Use of State-Specific Standard Population for the Calculation of AV

Beginning in 2015, if submitted by the State and approved by HHS, a State-specific data set will be used as the standard population to calculate AV in accordance with subsection (c)(1). The data set may be approved by HHS if it is submitted in accordance with subsection (c)(5) and:

 

A)        Supports the calculation of AVs for the full range of health plans available in the market;

 

B)        Is derived from a non-elderly population and estimates those likely to be covered by private health plans on or after January 1, 2014;

 

C)        Is large enough that:

 

i)          The demographic and spending patterns are stable over time; and

 

ii)         It includes a substantial majority of the State's insured population, subject to the requirement in subsection (c)(4)(B);

 

D)        Is a statistically reliable and stable basis for area-specific calculations; and

 

E)        Contains claims data on health care services typically offered in the then-current market.

 

5)         Submission of State-Specific Data

AV will be calculated using the default standard population described in subsection (c)(6), unless a data set in a format specified by HHS that can support the use of the AV Calculator as described in subsection (c)(1) is submitted by a State and approved by HHS consistent with subsection (c)(4) by a date specified by HHS.

 

6)         Default Standard Population

The default standard population for AV calculation will be developed and summary statistics, such as in continuance tables, will be provided by HHS in a format that supports the calculation of AV as described in subsection (c)(1). (See 45 CFR 156.135.)

 

d)         Actuarial Value Levels of Coverage

 

1)         General Requirement for Levels of Coverage

AV, calculated as described in subsection (c), and within a de minimis variation as defined in subsection (d)(3), determines whether a health plan offers a bronze, silver, gold or platinum level of coverage.

 

2)         The levels of coverage are:

 

A)        A bronze health plan is a health plan that has an AV of 60 percent.

 

B)        A silver health plan is a health plan that has an AV of 70 percent.

 

C)        A gold health plan is a health plan that has an AV of 80 percent.

 

D)        A platinum health plan is a health plan that has as an AV of 90 percent.

 

3)         De Minimis Variation

The allowable variation in the AV of a health plan that does not result in a material difference in the true dollar value of the health plan is ±2 percentage points. (See 45 CFR 146.140.)

 

e)         Determination of Minimum Value

 

1)         Acceptable Methods for Determining Minimum Value

An employer-sponsored plan provides minimum value (MV) if the percentage of the total allowed costs of benefits provided under the plan is no less than 60 percent. An employer-sponsored plan may use one of the following methods to determine whether the percentage of the total allowed costs of benefits provided under the plan is not less than 60 percent:

 

A)        The MV Calculator to be made available by HHS and the Internal Revenue Service. The result derived from the calculator may be modified under subsection (e)(2).

 

B)        Any safe harbor established by HHS and the Internal Revenue Service.

 

C)        If the plan is a group health plan, it may seek certification by an actuary to determine MV if the plan contains non-standard features that are not suitable for either of the methods described in subsections (e)(1)(A) or (B). The determination of MV must be made by a member of the American Academy of Actuaries, based on an analysis performed in accordance with generally accepted actuarial principles and methodologies.

 

D)        If the plan is in the small group market that meets any of the levels of coverage, as described in subsection (d), it satisfies MV.

 

2)         Benefits that May Be Counted Towards the Determination of MV

 

A)        In the event that a group health plan uses the MV Calculator and offers an EHB outside of the parameters of the MV Calculator, the plan may seek an actuary, who is a member of the American Academy of Actuaries, to determine the value of that benefit and adjust the result derived from the MV Calculator to reflect that value.

 

B)        For the purposes of applying the options described in subsection (e)(1) in determining MV, a group health plan will be permitted to take into account all benefits provided by the plan that are included in any one of the EHB benchmarks.

 

3)         Standard Population

The standard population for MV determinations described in subsection (e)(1) is the standard population developed by HHS for such use and described through summary statistics issued by HHS. The standard population for MV must reflect the population covered by self-insured group health plans.

 

4)         Employer Contributions to Health Savings Accounts and Amounts Made Available Under Certain Health Reimbursement Arrangements

For employer-sponsored self-insured group health plans and insured group health plans that at the time of purchase are offered in conjunction with an HSA or with integrated HRAs that may be used only for cost-sharing, annual employer contributions to HSAs and amounts newly made available under such HRAs for the current year are:

 

A)        Counted towards the total anticipated medical spending of the standard population that is paid by the health plan; and

 

B)        Adjusted to reflect the expected spending for health care costs in a benefit year so that:

 

i)          Any current year HSA contributions are accounted for; and

 

ii)         The amounts newly made available under such integrated HRAs for the current year are accounted for. (45 CFR 156.145)

 

f)         Application

In determining the percentage of the total allowed costs of benefits provided under a group health plan or health insurance coverage that are provided by such plan or coverage, this Section shall apply.  (See 42 USC 18022(d)(2)(C).)

 

g)         Allowable Variance

There may be a de minimis variation in the actuarial valuations used in determining the level of coverage of a plan to account for differences in actuarial estimates.  (See 42 USC 18022(d)(3).)

 

h)         Plan Reference

In this Section, any reference to a bronze, silver, gold or platinum plan shall be treated as a reference to a qualified health plan providing a bronze, silver, gold or platinum level of coverage, as the case may be.  (See 42 USC 18022(d)(4).)

 

i)          Catastrophic Plan

 

1)         In General

A health plan not providing a bronze, silver, gold or platinum level of coverage shall be treated as meeting the requirements of subsection (b) with respect to any plan year if:

 

A)        the only individuals who are eligible to enroll in the plan are individuals described in subsection (c)(2); and

 

B)        the plan provides:

 

i)          except as provided in subsection (c)(1)(B)(ii), the essential health benefits determined under Section 2001.11(c), except that the plan provides no benefits for any plan year until the individual has incurred cost-sharing expenses in an amount equal to the annual limitation in effect under subsection (a)(1) for the plan year (except as provided for in PHS Act section 2713); and

 

ii)         coverage for at least three primary care visits.

 

2)         Individuals Eligible for Enrollment

An individual is described in this subsection (i)(2) for any plan year if the individual:

 

A)        has not attained the age of 30 before the beginning of the plan year; or

 

B)        has a certification in effect for any plan year under this Part that the individual is exempt from the requirement under 26 USC 5000A by reason of:

 

i)          26 USC 5000A(e)(1) (relating to individuals without affordable coverage); or

 

ii)         26 USC 5000A(e)(5) (relating to individuals with hardships).

 

3)         Restriction to Individual Market

If a health insurance issuer offers a health plan described in this subsection (i), the issuer may only offer the plan in the individual market.  (See 42 USC 18022(e).)

 

j)          Child-Only Plans

If a qualified health plan is offered through the Health Benefits Exchange in any level of coverage specified under subsection (c), the issuer shall also offer that plan through the Health Benefits Exchange in that level as a plan in which the only enrollees are individuals who, as of the beginning of a plan year, have not attained the age of 21, and such plan shall be treated as a qualified health plan.  (See 42 USC 18022(f).)

 

k)         Payments to Federally Qualified Health Centers

If any item or service covered by a qualified health plan is provided by a Federally Qualified Health Center (as defined in 42 USC 1396d(l)(2)(B)) to an enrollee of the plan, the offeror of the plan shall pay to the center for the item or service an amount that is not less than the amount of payment that would have been paid to the center under 42 USC 1396a(bb)) for such item or service. (See 42 USC 18022(g).)

 

l)          Mutually Agreed Payment Rates

Nothing in subsection (k) precludes a Qualified Health Plan issuer and a Federally Qualified Health Center from mutually agreeing upon payment rates other than those that would have been paid to the center under 42 USC 1396a(bb), as long as the mutually agreed upon rates are at least equal to the generally applicable payment rates of the issuer indicated in 45 CFR 156.235(d). (See 45 CFR 156.235(e).)

 

(Source:  Amended at 38 Ill. Reg. 23379, effective November 25, 2014)

 

Section 2001.13  Corporate Name Requirements

 

The name of the actual health insurance issuer shall be stated on all of its forms.  Policy forms or other items incorporated by reference shall not use a trade name, any insurance group designation, name of the parent company of the issuer, name of a particular division of the issuer, service mark, slogan, symbol or other device that, without disclosing the name of the actual issuer, would have the capacity and tendency to mislead or deceive as to the true identity of the issuer.

 

a)         There must be printed at the head of the policy the name of the issuer or issuers issuing the policy and the location of the home office of the issuer or issuers.  Devices, emblems or designs, and dates as are appropriate for the issuer issuing the policy may also be added.

 

b)         The complete issuer name, as registered with the Department, shall appear in the footer on all forms filed with the Department.

 

(Source:  Added at 44 Ill. Reg. 14721, effective August 28, 2020)

SUBPART B: PROVISIONS APPLICABLE TO INDIVIDUAL POLICIES

 

Section 2001.20  Construction of Accident and Health Insurance Policy Forms (Renumbered)

 

(Source:  Section 2001.20 renumbered to Section 2001.120 at 38 Ill. Reg. 2037, effective January 2, 2014)

 

Section 2001.30  Filing of Policy Forms (Renumbered)

 

(Source:  Section 2001.30 renumbered to Section 2001.l30 at 38 Ill. Reg. 2037, effective January 2, 2014)

 

Section 2001.110  Applicability

 

This Subpart shall apply to:

 

a)         Individual accident and health policy, certificate, endorsement, rider and application forms filed with the Department by both foreign and domestic companies with respect to Section 143, Article IX and Article XX of the Code.

 

b)         This Part shall also apply to individual policy, certificate, endorsement, rider and application forms filed in accordance with Section 356a of the Code.

 

c)         The filing procedure for accident and health forms as required by Section 355 of the Code.

 

d)         The filing procedure for accident and health insurance policy forms prescribed by 50 Ill. Adm. Code 916.

 

(Source:  Old Section 2001.10 renumbered to Section 2001.110 and amended at 38 Ill. Reg. 2037, effective January 2, 2014)

 

Section 2001.120  Construction of Accident and Health Insurance Policy Forms

 

a)         Section 356a − Form of Policy

Each policy form of a domestic company that is issued for delivery to a person residing in another state must be approved by the Director unless that policy form is subject to approval or disapproval by the other state.

 

b)         Section 357.1 − Accident and Health Policy Provisions Required

 

1)         In order to expedite departmental action on policies submitted for approval, it is requested that companies adhere to the statutory wording and order of the required provisions.  Policies submitted that include variations from the statutory words and order must be accompanied by a complete list of all variations and a justification for each.  Extensive variations, without adequate justification, will only result in delay in the processing of the policies.  The companies' cooperation in keeping variations to a minimum is essential.

 

2)         Each provision of Sections 357.2 through 357.113 of the Code  must be preceded by a caption and, if the captions differ in any respect from the captions appearing in the law, changes must be clearly indicated and justified pursuant to subsection (b)(1).

 

3)         Numbering of the "Required Provisions" will not be required.

 

c)         Section 359a − Application

 

1)         When an Industrial Accident and Health policy is issued upon signed application of the person to be insured, the application shall conform with Section 359a of the Code.

 

2)         The Application

 

A)        When changes are made on the application for administrative purposes only, the changes must be clearly indicated.

 

B)        When the application is subject to being changed for administrative purposes by the insurer, the application shall clearly indicate that any changes are not to be ascribed to the applicant.

 

d)         Section 361a − Age Limit

Any policy form containing an "age limit" shall contain in substance a provision setting forth the limitations of Section 361a of the Code.

 

e)         Section 362a − Non-Application to Certain Policies

Section 362a(3) of the Code does not apply to group accident and health insurance provided for under Section 356a(1)(c) of the Code.

 

f)         Section 368 − Industrial Accident and Health Insurance

The Department will require Industrial Accident and Health policy forms to be of the same form and content as other accident and health insurance policy forms required to be filed pursuant to Section 355 of the Code, except Industrial Accident and Health Policies shall be issued on a weekly premium basis and contain the words "Industrial Policy" printed on each form.

           

g)         Accident and Health Insurance

 

1)         Accident and health insurance may only be defined as insurance against bodily injury, disablement or death by accident and against disablement resulting from sickness or old age and every insurance appertaining thereto.

 

2)         Terms such as "external" and "violent" in connection with the definition of accident and health insurance are not acceptable.

 

h)         The information required in Section 356a(1)(a) and (b) of the Code must appear in the policy form itself or on its schedule page and cannot be added to the policy by rider, endorsement or supplement.  Although riders, endorsements and supplements, when attached to the policy form, become a part of the contract, it is evident the law intends that the information required by Section 356a(1)(a) and (b) be made a part of the policy form itself, since this Section specifically refers to the policy and distinguishes between the policy forms, riders and endorsements.

 

i)          Funeral benefits will not be permitted in accident and health contracts.

 

j)          If hospitals are defined in accident and health contract forms presented for use in this State, then an appropriate definition must be used.  A term such as "legally operated hospital", or any other definition that is definite and applicable in this State, will be accepted.

 

k)         Waiting period provisions in accident and health insurance contracts that stipulate the contract must be maintained in "continuous force" or "in force for (a specified number of)  months after the effective date of the policy" or "in force for (a specified number of)  months prior to the date of the loss" will not be accepted. Those provisions do not adequately and clearly cover reinstatements and, therefore, waiting periods must be based upon the loss occurring (a specified number of)  months after the effective date of the policy and read similar to:  No indemnity will be paid for loss that occurs, or commences, prior to (a specified number of)  months after the effective date of the policy.

 

l)          Additional waiting periods for certain designated diseases or illnesses based upon inception beyond the usual customary 15 to 30 days provided for in the insuring provisions are not permissible.  If additional waiting periods are deemed necessary by the company for certain diseases and illnesses, then the Department requires that waiting periods be based upon the loss occurring so many months after the effective date of the policy, rather than being based on the inception of the illness or disease.

 

m)        "Strict compliance provisions" in accident and health insurance contracts will not be acceptable for use in this State.

 

n)         Any specific requirement for medical attendance by a licensed physician, other than that attendance that is normally and customarily required for the disease or accident resulting in loss for which claim is made, will not be acceptable.

 

o)         In accident and health insurance contracts that include "medical attendance benefits" and "surgical benefits" and limits liability to only one, provision must be made for the payment of the greater benefit.

 

p)         Broad, indefinite, ambiguous and inconsistent language must be excluded from all accident and health insurance forms.  Examples of such wording are:

 

1)         The use of the words "indirectly" and "partly" in connection with Exclusions, Limitations and Reductions;

 

2)         The use of the word "reasonable" when used in connection with medical attendance or any other condition or requirement included in the policy form, unless use of that word results in the provision being more favorable to the insured;

 

3)         The use of such words as "appendages", "involving", "affecting", etc., in connection with specified physical conditions.  Medical terms should be definite.  For instance, various types of hernia should be spelled out, or the forms should provide a general statement that all types of hernia are meant.

 

q)         Surgical Benefit Provisions in accident and health insurance contracts must include and provide either:

 

1)         That all operations will be covered not to exceed a stipulated amount for any operation that may be performed; or

 

2)         A schedule of operations that includes:

 

A)        Comparable benefits for operations of comparable severity;

 

B)        A provision that requires the company to pay a benefit for any operation not listed in the schedule, based on an amount equivalent to that specified for a listed operation of comparable severity; and

 

C)        A provision that requires the company to pay for that operation that provides the largest benefit when the company's liability is limited to one operation when more than one is performed, under named or enumerated conditions.

 

r)          Surgical benefit provisions that are contingent upon payment of a hospital confinement benefit will not be approved.

 

s)         Benefits for hospital room that are based upon the actual expense incurred may be made contingent only upon a charge being made by the hospital. Benefits payable on a stated or flat rate basis, regardless of the amount of expense incurred, may make the benefit contingent upon hospital confinement of so many hours.

 

t)          Premium, Cancellation and Renewal Provisions

 

1)         Waiver of Premium Provisions must include a statement of coverage and of the insured's rights and obligations regarding the resumption of premium payments after the period of total disability has terminated, during which the premium has been waived.  This statement must read similarly to:  After the termination of the period of total disability, during which a premium has been waived, the insurance afforded in this contract shall continue in full force and effect until the next premium due date, at which time the insured shall have the right to resume the payment of premiums as provided in the contract.

 

2)         If a premium is to be charged for the period from the expiration of the period of total disability during which a premium has been waived and the expiration date of the policy, then a statement of this fact must be added to the provision, together with a provision that the insurer will notify the insured of the premium due.

 

3)         A policy that contains a cancellable provision may add at the end of the provision in (u)(2) "subject to the right of the insurer to cancel in accordance with the cancellation provision hereof".

 

4)         A policy in which the insurer reserves the right to refuse any renewal premiums shall add "unless not less than five days prior to the premium due date the insurer has delivered to the insured or has mailed to his last address as shown by records of the insurer, written notice of its intention not to renew this policy beyond the period for which the premium has been waived".

 

u)         Requirements for the so-called "franchise insurance" are different from those for individual contracts in the following respects:  Termination either by cancellation or refusal to renew any individual contracts of the group is prohibited, unless all like contracts of the group are terminated at the expiration of the contracts and upon at least ten days' notice in advance. The only other termination conditions that may be included in these contracts are those that terminate coverage because of nonpayment of premium, discontinuance of employment of the insured by the named employer, or the discontinuance of membership in the designated organization or association, and, in addition, coverage may be automatically terminated at a designated attained age.

 

v)         Policy forms that, in the opinion of the Department, will invite misrepresentations in the advertising and sale of the policy, due to the restrictive nature of the forms as a result of unusual and/or over-lapping exclusions, limitations, reductions or conditions, will not be accepted for use in this State.

 

w)        Time limitations, when included in benefit provisions, must be explained in terms such as hours, days, weeks, months or years.  Terms such as "immediately" or "reasonably" are not acceptable, unless use of those words makes the provision more favorable to the insured.

 

x)         Policy contracts issued by assessment companies must include a provision setting forth the contingent liability of the insured and should be based upon the regular premium provided in the policy and, in addition, such premium payments as may be required by the company from time to time. This provision should be placed in the contract with equal prominence to the benefit provisions.

 

y)         When a contingent liability provision is included in a contract issued by a mutual company as provided for in Section 55 of the Code, the contingent liability of the policyholder must be based upon not less than one nor more than ten times the amount of the premium expressed in the continuation paragraph of the policy.  This provision should be placed in the contract with equal prominence to the benefit provisions.

 

z)         Limited policy contracts will not be approved that, in the opinion of the Director, set forth in a more prominent manner the provisions for relatively large benefits for specified accidents of rare occurrence than provisions for relatively low benefits for accidents of more frequent occurrence.  Accumulative indemnities benefits are permissible, but schedules showing those benefits will not be approved in accident and health contracts.

 

aa)       Riders, Endorsements and Exclusions

 

1)         Riders and endorsements that are not complete in themselves must be accompanied by the fill-in material to be used with the riders and endorsements to be acceptable.

 

2)         Exclusion of coverage riders and endorsements, executed subsequent to the issuance of the policy, must provide for the signed acceptance of the insured in addition to a statement to the effect that the rider or endorsement is not valid unless signed by the insured.  Policy forms that unilaterally reduce benefits must be formally approved by the Director prior to the date they are attached to a policy issued or delivered in this State.

 

3)         Riders or endorsements submitted for the purpose of amending forms submitted in accordance with Section 355 of the Code will not be accepted for approval, unless the Director is given an adequate justification, in writing, for the use of the riders or endorsements.

 

bb)       Application

 

1)         Questions in an application pertaining to diseases or conditions must be broken down so that applicants may insert their answer at least after every four or five diseases or conditions listed, unless questions are grouped as to related diseases or conditions.

 

2)         Application forms that are completed by individuals for themselves and others cannot include a certification as to the correctness of the answers in the application without some qualifications, preferably in the Attestation Provision, and should read similar to "to the best of your knowledge", or "to the best of your knowledge and belief".  The courts have held that answers to the questions are given to the best of the applicant's belief, and the Department sees no reason why the aforementioned qualification should not be contained in the application.

 

3)         The receipt and/or application or policy provisions may provide that the insurance shall be effective upon issuance and the payment of the first premium while the insured is in good health.  Provisions that provide the insurance shall not become effective until delivery of the policy while the insured is in good health will not be acceptable.

 

cc)       When the application provides for a written proxy, that proxy must be executed over the separate signature of the applicant.  The signature required for the application in accordance with Section 359a of the Code  may not be used to satisfy this requirement.

 

dd)      Advertising appearing on an application form, or any other form that requires the approval of the Director, is reviewed and filed by the Director in conjunction with the approval of the form. This is in conformity with Section 143 of the Code.

 

ee)       The Director requires that any form, previously approved and subsequently revised, must be submitted under a new form number, and be approved in accordance with Section 143 of the Code.  This applies to advertising appearing on applications or other forms approved by the Director.  The only exception to this is advertising that contains statistical information, such as the amount of claims paid or assets.  For changes of this kind, the insurer need not submit a new form number, but only advise the Department in writing as to the change in the statistical information and the date of change.  Advertising is not subject to approval but is filed for informational purposes only. See 50 Ill. Adm. Code 916 for appropriate transmittal sheets and instructions.

 

(Source:  Section 2001.120 renumbered from 2001.20 and amended at 38 Ill. Reg. 2037, effective January 2, 2014)

 

Section 2001.130  Filing of Policy Forms

 

a)         Policy forms, riders and endorsements must be formally filed pursuant to 50 Ill. Adm. Code 916 as follows:

 

1)         Two copies of all forms shall be submitted in blank.  If the form does not clearly indicate the place for the name of the insured, the time the insurance becomes effective, and the benefits, it will be required that the forms be completed at the time of issuance.

 

2)         Each form must bear an identifying form number in the lower left corner of the first page.  The form number is limited to 30 characters. No other date, except the inclusion of a printing date and/or designation of a state where a special edition is required will be permitted in this space.

 

3)         The insurer shall file a letter of submission, or provide the following information in the Filing Description field under the General Information tab in the System for Electronic Rate and Form Filing (SERFF), containing:

 

A)        The name of the form, if any, and identifying form number;

 

B)        Whether the submission is a new form;

 

C)        If the form is intended to supersede another, the form number of the form replaced and the date it was approved by the Department, with all changes from the previously approved form highlighted.  Any changes not highlighted will not be deemed to be approved.

 

b)         Copies of the policy forms, riders and endorsements will be retained in the files of the Department.  The Department will provide notice of approval through SERFF.

 

c)         Under no circumstances will copies of forms be returned to the company with the Department's stamp of approval on the copies.  Notice of approval will be given by letter or copy of the submitted transmittal form with the Department's stamp affixed.

 

(Source:  Section 2001.130 renumbered from Section 2001.30 and amended at 38 Ill. Reg. 2037, effective January 2, 2014)

SUBPART C: PROVISIONS APPLICABLE TO GROUP POLICIES

 

Section 2001.210  Applicability

 

This Subpart is applicable to all group accident and health policies except to the extent that they provide excepted benefits.

 

(Source:  Added at 38 Ill. Reg. 2037, effective January 2, 2014)

 

Section 2001.220  Ban on Excessive Waiting Periods

 

A group health plan, and a health insurance issuer offering group health insurance coverage, must not apply any waiting period that exceeds 90 days (42 USC 300gg-7).

 

(Source:  Added at 38 Ill. Reg. 2037, effective January 2, 2014)