PART 4521 HEALTH MAINTENANCE ORGANIZATION : Sections Listing

TITLE 50: INSURANCE
CHAPTER I: DEPARTMENT OF INSURANCE
SUBCHAPTER ww: HEALTH CARE SERVICE PLANS
PART 4521 HEALTH MAINTENANCE ORGANIZATION


AUTHORITY: Implementing and authorized by Sections 4-6.1, 4-17, 5-2 and 5-7 of the Health Maintenance Organization Act [215 ILCS 125/4-6.1, 4-17, 5-2 and 5-7]; 42 U.S.C. 300gg-22; and 45 CFR 150.101(b)(2) and 150.201.

SOURCE: Filed June 16, 1976, effective July 1, 1976; codified at 7 Ill. Reg. 3016; amended at 15 Ill. Reg. 199, effective December 28, 1990; amended at 20 Ill. Reg. 10639, effective July 25, 1996; recodified at 21 Ill. Reg. 1729; emergency amendment at 21 Ill. Reg. 15262, effective November 18, 1997, for a maximum of 150 days; amended at 22 Ill. Reg. 6671, effective March 31, 1998; amended at 23 Ill. Reg. 5690, effective May 3, 1999; emergency amendment at 26 Ill. Reg. 5146, effective March 25, 2002, for a maximum of 150 days; amended at 26 Ill. Reg. 13088, effective August 19, 2002; transferred from the Department of Insurance to the Department of Financial and Professional Regulation pursuant to Executive Order 2004-6 on July 1, 2004; amended at 28 Ill. Reg. 14412, effective October 19, 2004; amended at 30 Ill. Reg. 4732, effective March 2, 2006; transferred from the Department of Financial and Professional Regulation to the Department of Insurance pursuant to Executive Order 2009-4 on June 1, 2009; amended at 37 Ill. Reg. 14032, effective August 26, 2013; amended at 38 Ill. Reg. 2272, effective January 2, 2014; amended at 38 Ill. Reg. 23437, effective November 25, 2014; amended at 39 Ill. Reg. 6505, effective April 24, 2015; recodified from 50 Ill. Adm. Code 5421 to 50 Ill. Adm. Code 4521 at 41 Ill. Reg. 4985; amended at 43 Ill. Reg. 9386, effective August 26, 2019; amended at 48 Ill. Reg. 7266, effective April 30, 2024.

 

Section 4521.10  Scope

 

This Part shall apply to any Health Maintenance Organization (HMO) as defined in Section 1-2(9) of the Act.

 

(Source:  Amended at 30 Ill. Reg. 4732, effective March 2, 2006)

 

Section 4521.20  Definitions

 

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

 

"Act" means the Health Maintenance Organization Act [215 ILCS 125].

 

"Advertisement" has the meaning ascribed in Section 1-21(1) of the Act.

 

"Base Rates" means the rate generated before any classification deviations are applied.

 

"Basic Health Care Services" means emergency care, and inpatient hospital and physician care, outpatient medical services, mental health services and care for alcohol and drug abuse, infertility treatment, prenatal and postnatal care, delivery and inpatient services for maternity care, and preventative services required pursuant to 42 U.S.C. 300gg-13, all of which are subject to limitations set forth in this Part (see Section 1-2(3) of the Act).

 

"Cancellation" means the termination of a group contract, evidence of coverage, or individual contract by an HMO prior to the expiration date of the group contract, evidence of coverage, or individual contract.

 

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

 

"Consumer" means any enrollee, provided that the individual is not or has not been in the previous two years an employee (including the employee's spouse or dependent) of the HMO or affiliate of the HMO or a provider furnishing health care services to the HMO or affiliate of the HMO.

 

"Copayment" means the amount an enrollee must pay in order to receive a specific covered service that is not fully prepaid.

 

"Deductible" means the amount an enrollee is responsible to pay out of pocket before the HMO begins to pay the costs associated with treatment.

 

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

 

"Department" means the Illinois Department of Insurance.

 

"Department of Insurance Complaint" means a written complaint filed by or on behalf of an enrollee, with the Department pursuant to Section 4-6 of the Act, excluding complaints filed by Illinois Department of Healthcare and Family Services HMO members under Section 5-11 of the Public Aid Code [305 ILCS 5/5-11] and complaints subject to handling by the Centers for Medicare and Medicaid Services (CMMS) pursuant to a contract entered into between CMMS and the HMO.

 

"Enrollee" has the meaning ascribed in Section 1-2(4) of the Act.

 

"Evidence of Coverage" has the meaning ascribed in Section 1-2(5) of the Act.

 

"Governing Body" means the board of trustees, or directors, or, if otherwise designated in the basic organizational document bylaws, those individuals vested with the ultimate responsibility for the management of any organization that has been issued or is applying for a certificate of authority as an HMO.

 

"Grievance" means any written complaint submitted to the HMO by or on behalf of an enrollee regarding any aspect of the HMO relative to the enrollee, but shall not include any complaint by or on behalf of a provider.

 

"Grievance Committee" means individuals who have been appointed by the HMO to respond to grievances that have been filed on appeal from the HMO's simplified complaint process established pursuant to Section 4521.40(d).  At least 50% of the individuals on this committee shall be enrollees who are consumers.

 

"Group Contract" has the meaning ascribed in Section 1-2(6) of the Act.

 

"Health Care Plan" has the meaning ascribed in Section 1-2(7) of the Act.

 

"Health Care Services" has the meaning ascribed in Section 1-2(8) of the Act.

 

"HMO" means Health Maintenance Organization.

 

"Individual Contract" means a contract for health care services issued to and covering an individual.  The individual contract may include dependents of the subscriber.

 

"Limited Insurance Representative" means an individual appointed by an HMO to represent the HMO in the enrollment of recipients of Medicaid or Medicare in the HMO.

 

"Managed Care Organization" or "MCO" means a partnership, association, corporation, or other legal entity, including but not limited to individual practice associations (IPAs) and Physician Hospital Organizations (PHOs), that delivers or arranges for the delivery of health care services through providers it has contracted with or otherwise made arrangements with to furnish those health care services.

 

"Notice of Availability of the Department", as required by this Part, shall be no less informative than the following:

 

The regulations of the Illinois Department of Insurance (50 Ill. Adm. Code 4521.110(p)) require that we advise you that if you wish to take this matter up with the Illinois Department of Insurance it maintains a Consumer Division in Chicago at 122 S. Michigan Avenue, 19th Floor, Chicago, Illinois  60603 and in Springfield at 320 West Washington Street, Springfield, Illinois  62767-0001.  The Department can also be contacted by phone at (217) 782-4515 or its website at: https://idoi.illinois.gov.

 

"Nursing Home" means a skilled nursing care facility that is subject to licensure by the Illinois Department of Public Health under the Nursing Home Care Act [210 ILCS 45].

 

"Point of Service Plan" means a plan in which an eligible enrollee is covered under both an HMO evidence of coverage and an indemnity insurance policy or certificate and may select, on a point-of-service basis, between using the HMO or the indemnity benefit program.

 

"Primary Care Physician" means a provider who has contracted with an HMO to provide primary care services as defined by the contract and who is:

 

a physician licensed to practice medicine in all of its branches who spends a majority of clinical time engaged in general practice or in the practice of internal medicine, pediatrics, gynecology, obstetrics, or family practice;

 

a chiropractic physician licensed to treat human ailments without the use of drugs or operative surgery.

 

"Producer" means a person directly or indirectly associated with a health care plan who engages in solicitation or enrollment (see Section 1-2(13) of the Act).

 

"Provider" has the meaning ascribed in Section 1-2(12) of the Act.

 

"Renewal" means the issuance and delivery by an HMO of a group contract or individual contract superseding at the end of the contract period a contract previously issued and delivered by the same HMO or the issuance and delivery of a certificate or notice extending the term of the group or individual contract beyond its contract term.

 

"Solicitation" means any method by which information relative to an HMO is made known to the public for the purpose of informing or influencing potential enrollees to enroll in a Health Care Plan, regardless of the media or technique used.

 

"State" means any governing body, department or agency of the State of Illinois that has regulatory authority under the Act.

 

"Subscriber" has the meaning ascribed in Section 1-2(16) of the Act.

 

"Supplemental Health Care Services" means any health care service other than basic health care services.

 

"Usual and Customary Fee" means the fee, as reasonably determined by the HMO, that is based on the fee the provider who renders the service usually charges its patients for the same service.  The fee shall be within the range of usual fees other providers of similar type, training, and experience in a similar geographic area charge their patients for the same service, under similar or comparable circumstances.

 

(Source:  Amended at 48 Ill. Reg. 7266, effective April 30, 2024)

 

Section 4521.30  Valuation of Investments

 

a)         The "Purposes and Procedures Manual of the NAIC Investment Analysis Office", as of December 31, 2022 (National Association of Insurance Commissioners, One New York Plaza, Ste. 4210, New York NY  10004) (no later editions or amendments), available at https://www.naic.org, shall be used for valuing securities for which valuations are not otherwise defined by statute or rule.  The Director shall disallow any procedure prescribed by that manual if the Director deems it necessary to ascertain the condition and affairs of the company.  In making this determination, the Director shall consider such factors as:

 

1)         the nature of the investment (stocks or bonds);

 

2)         the financial condition of the issuing company;

 

3)         the applicability of other standardized accounting procedures; and

 

4)         other factors affecting the accuracy of the valuation.

 

b)         The following procedure shall be required for the listed investment:

 

1)         Real Estate

Written appraisals for real estate investments shall be submitted to the Department for review 15 days following the end of the month in which the real estate was acquired.  Real estate investments requiring approval under Section 3-1(h)(16)(iii) of the Act shall have an appraisal.  The appraisal shall be reviewed to ensure that the appraisal was performed by a member of the Appraisal Institute in the customary manner and that the appraisal supports the valuation amount expressed by the company in its annual statement. 

 

2)         Valuation of Investments Otherwise Defined

A company that has an investment that cannot be valued in accordance with the procedures outlined in subsection (b)(1) must file a request for valuation with the Department within 15 days following the end of the month in which the investment is acquired.  This request shall include, at a minimum, the following information:

 

A)        A description of the investment;

 

B)        Date of acquisition;

 

C)        Name of vendor;

 

D)        Cost of investment to company;

 

E)        Par value, if relevant;

 

F)         Rate and/or amount of interest, dividend or other compensation earned or accrued; and

 

G)        Any other significant terms of the investment.

 

(Source:  Amended at 48 Ill. Reg. 7266, effective April 30, 2024)

 

Section 4521.40  Grievance Procedure

 

a)         Every HMO shall submit for the Director's approval, and maintain, a system for the resolution of grievances concerning the provision of health care services or other matters concerning operation of the HMO as follows.  Each HMO shall:

 

1)         Submit to the Director for prior approval any proposed changes to the system by which grievances may be filed and reviewed;

 

2)         Maintain records of each grievance, filed with the HMO until the grievance is resolved and for a period of at least 3 years, that includes:

 

A)        A copy of the grievance, the date of its filing;

 

B)        The date and outcome of all consultations, hearings and hearing findings;

 

C)        The date and decisions of any appeal proceedings; and

 

D)        The date and proceedings of any litigation;

 

3)         Submit to the Director, in a form prescribed by the Director, a report by March 1 for the previous calendar year that includes at least the following:

 

A)        the total number of grievances handled;

 

B)        a compilation of causes underlying the grievances;

 

C)        the outcomes of the grievances;

 

D)        the elapsed time from receipt of the grievance by the HMO until its conclusion; and

 

E)        the number of malpractice claims filed and, if those claims have been completely adjudicated, a compilation of causes, disposition, form and amount of any settlements.

 

b)         Every HMO shall have a grievance committee with the authority to hear and resolve by majority vote grievances submitted to it as provided in subsection (a).

 

1)         Notwithstanding any other provisions of this Section, the grievance committee may, but is not required to, hear any grievance that alleges or indicates possible professional liability, commonly known as "malpractice".

 

2)         The committee is not empowered to resolve grievances in any manner, or prescribe any actions, that are in conflict with written policies of the HMO's Governing Body, but the committee may hear such grievances for the purpose of providing input to the Governing Body.

 

3)         The grievance committee shall meet at the main office of the HMO, or other office designated by the HMO if the main office is not within 50 miles of the grievant's home address. Consideration shall be given to the enrollee's request pertaining to the time and date of the meeting.  The enrollee shall have the right to attend and participate in the formal grievance proceedings.  The enrollee shall have the right to be represented by a designated representative of his or her choice.

 

4)         The filing of a grievance shall not preclude the enrollee from filing a complaint with the Department, nor shall it preclude the Department from investigating a complaint pursuant to its authority under Section 4-6 of the Act.

 

c)         The grievance procedures must be fully and clearly communicated to all enrollees and information concerning grievance procedures shall be readily available to the enrollee.

 

d)         Every HMO shall have simplified procedures for resolving complaints.  The procedures do not require review of the complaint by the grievance committee, but a log, file, or other similar records must be maintained to identify the general nature of the complaints.  Resolution of complaints shall not preclude the enrollees' rightful access to review by the grievance committee of a grievance.

 

e)         The HMO shall institute procedures that would require grievances to have a determination made by the grievance committee within 60 days from the date the grievance is received by the HMO.  A grievance may not be heard or voted upon unless at least 50% of the voting individuals of the committee are enrollees.  The determination by the grievance committee may be extended for a period not to exceed 30 days in the event of a delay in obtaining the documents or records necessary for the resolution of the grievance.  All requests for documents or records necessary for the resolution of the grievance shall be maintained in the HMO's grievance file.

 

f)         The grievance procedure shall provide the enrollee with a written acknowledgment of the grievance within 10 business days after receipt by the HMO.

 

g)         The enrollee shall be notified at the time of the hearing of the name and affiliation of those grievance committee members who are representatives of the HMO.

 

h)         The HMO shall institute procedures whereby any documentation furnished to the members of the grievance committee shall also be made available to the enrollee not less than 5 business days prior to the hearing of the grievance.  The HMO shall not present any evidence without the enrollee having been given the opportunity to be present.

 

i)          Notification in writing of the determination of the grievance committee shall be mailed to the enrollee within 5 business days after the determination.  Notice of the determination made at the final appeal step of the HMO's grievance process shall include a Notice of Availability of the Department that the HMO shall send to its enrollees explaining that the Department is available to respond to their inquiries.

 

j)          Prior to the resolution of a grievance filed by a subscriber or enrollee, coverage shall not be terminated for any reason that is the subject of the written grievance, except when the HMO has, in good faith, made a reasonable effort to resolve the written grievance through its grievance procedure and coverage is being terminated as provided for in Section 4521.111 of this Part.

 

(Source:  Amended at 37 Ill. Reg. 14032, effective August 26, 2013)

 

Section 4521.50  Contracts, Administrative Arrangements and Material Modifications

 

a)         Agreements or Contracts

 

1)         All sample agreements or contracts, with variable language bracketed, under which any person is delegated management duties or control of the HMO or that transfer a substantial part of any major function of the HMO, including but not limited to all reinsurance treaties, all agreements with providers, and all administrative service contracts, must be submitted to the Department of Insurance.  The HMO must file with the Department any contract amendments, renewals, addenda, or any other changes from those originally submitted.  The HMO must also file any material modifications to the application submitted pursuant to Section 2-1 of the Act including, but not limited to, extension of service area.

 

2)         The HMO must file with the Department of Public Health copies of all sample agreements with providers, as well as any amendments, addenda, or any other changes from the agreements originally submitted.

 

3)         On a quarterly basis, each HMO must submit a list identifying any MCO with which the HMO has a current contract.  The list must contain the name, address, and telephone number of the MCO, as well as the name of its Administrator, and must identify the bond or letter of credit issuer as required by subsection (d)(2), along with the expiration date and principal dollar amount for the instrument.  The quarterly report shall be due at the Department within 10 days following the end of each quarter.

 

4)         All types of written health care provider agreements must contain provisions under which the provider shall provide, arrange for, or participate in the quality assurance programs mandated by Section 2-8(b) of the Act, unless the Illinois Department of Public Health certifies that those programs will be fully implemented without any participation or action from the contracting provider.

 

5)         All provider agreements shall provide for at least 60 days' notice by the provider for termination with cause, as defined in the provider agreement, and at least 90 days' notice by the provider for termination without cause.  The HMO must inform the Department immediately of any known or intended termination, with or without cause, of an MCO.

 

6)         Subscribers must receive notice from the HMO at least 60 days in advance of any termination that would curtail or eliminate services to subscribers.  However, in the event that the HMO receives notice of less than 60 days from any provider for termination of any contract that would curtail or eliminate services to subscribers, the HMO must provide immediate notice to the subscribers.  The Notice shall include instructions regarding referrals which have been issued and appointments which may be pending.

 

7)         The contractual agreement between the provider and the HMO must contain evidence that the provider has professional liability insurance and that such insurance coverage is effective as of the effective date of such contract.  Furthermore, the contract must set forth that the Provider will give at least 15 days' advance notice of cancellation of such insurance.  In instances in which the HMO will provide physician services directly through employed physicians and not through a contractual arrangement with a provider, the HMO shall provide evidence to the Department that each individual physician has professional liability insurance or that the HMO has coverage on behalf of the employed physicians.

 

b)         The Director must disapprove any provider agreement if, at any time, the Director finds:

 

1)         that the charges to the HMO are based on factors unrelated to the value of providing services to the HMO;

 

2)         that the contract will significantly impact or threaten the financial viability of the HMO;

 

3)         that the provider agreement would transfer substantial control of the HMO or any powers vested in the board of directors, by statute, articles of incorporation, or bylaws, or substantially all of the basic functions of the HMO management;

 

4)         that the provider agreement contains provisions contrary to the Illinois Insurance Code;

 

5)         that the provider is or has been affiliated directly or indirectly, through ownership, control, management, reinsurance transactions or other insurance, or business relations with any person or persons known to have been involved in the improper manipulation of assets, accounts, or reinsurance; or

 

6)         that the provider agreement does not contain the provisions required by subsections (d) and (e).

 

c)         If the Director disapproves of any provider agreement, notice of that action shall be given to the HMO, listing the reasons for the disapproval in writing.  The Director shall grant any party to the provider agreement a hearing upon request according to Article XXIV of the Code.

 

d)         This subsection shall apply to all HMO agreements with MCOs authorized to furnish health care services, when the fees for furnishing, arranging or providing the health care services are capitated.

 

1)         All capitated MCO agreements shall contain a provision stating that the MCO will submit to the HMO copies of its quarterly financial statements, including the MCO's balance sheet and statements of income and cash flow within 45 days after the end of each fiscal period.  In addition, the HMOs shall require the MCO to submit within 90 days after the end of the MCO's fiscal year copies of its audited annual financial statements prepared in accordance with generally accepted accounting principles, if available.  The Department, at its discretion, may require the HMO to submit for inspection by the Department statements the HMO has received from the MCO.  This information shall be deemed confidential by the Department.

 

2)         All capitated MCO agreements shall contain provisions requiring the disclosure of the MCO's agreement to cooperate fully with, and disclose all relevant information requested by, the HMO's actuaries for the preparation of their opinion.

 

3)         All capitated MCO agreements shall contain provisions under which the HMO acknowledges that, in the event of the MCO's insolvency, the HMO is secondarily liable as the ultimate risk bearer for unpaid health care services rendered to its enrollees.

 

e)         All capitated provider agreements between the HMO and its capitated providers shall contain the following hold-harmless clause.  To the extent that any provider contract fails to incorporate the hold-harmless clause, the clause shall be deemed incorporated into those contracts by operation of law as of the date of the renewal of execution.

 

"The provider agrees that in no event, including but not limited to nonpayment by the HMO of amounts due the provider under this contract, insolvency of the HMO, or any breach of this contract by the HMO, shall the provider or its assignees or subcontractors have a right to or seek any type of payment from, bill, charge, collect a deposit from, or have any recourse against, the enrollee, persons acting on the enrollee's behalf (other than the HMO), the employer, or group contract holder for services provided pursuant to this contract, except for the payment of applicable copayments or deductibles for services covered by the organization or fees for services not covered by the HMO.  The requirements of this clause shall survive any termination of this contract for services rendered prior to its termination, regardless of the cause of the termination.  The HMO's enrollees, the persons acting on the enrollee's behalf (other than the HMO), and the employer or group contract holder shall be third-party beneficiaries of this clause.  This clause supersedes any oral or written agreement now existing or hereafter entered into between the provider and the enrollee, persons acting on the enrollee's behalf (other than the HMO), and the employer or group contract holder."

 

f)         The procedure to be followed by HMOs for extension of operations into additional counties in Illinois shall be as follows:

 

1)         Upon receipt of certification by the Illinois Department of Public Health, the HMO shall submit a letter to the Director amending its service area.  This letter will indicate that all subscription certificates, rates, provider agreements, and any other applicable documents to be used to service the extended area are those previously filed or, if not, that new or revised documents will be submitted to the Department for review.

 

2)         Each notification for extension of operations shall be accompanied by a list of the counties in which the HMO is authorized to operate prior to any requested extension of service area.

 

(Source:  Amended at 48 Ill. Reg. 7266, effective April 30, 2024)

 

Section 4521.60  Rates

 

a)         Subject to the requirements of 50 Ill. Adm. Code 2026, the HMO shall file all schedules of base rates to be used in conjunction with enrollee certificates.  The schedules shall be filed with the Director prior to the effective date and will be maintained as a public document by the Department.

 

b)         When the schedules of base rates are filed, percentage change from the previous filing for the schedules of base rates shall be included.

 

c)         Upon the request of the Director, the HMO shall submit actuarial documentation for any submitted rates, which shall be stamped "confidential" by the HMO.  Documentation shall include, but not be limited to, the major cost components, experience, assumptions and procedures used to develop the submitted rates.  The actuarial documentation shall be deemed confidential and proprietary by the Department unless specific authorization is given by the HMO.

 

(Source:  Amended at 38 Ill. Reg. 2272, effective January 2, 2014)

 

Section 4521.70  Subordinated Indebtedness

 

Subordinated indebtedness agreements (debenture) shall be submitted for the approval of the Director as required by Section 2-9 of the Act.

 

a)         The agreement must state that:

 

1)         All payments of principal and/or interest may be made only after the HMO has obtained approval from the Director;

 

2)         The obligation of the HMO under the debenture may not be offset or be subject to recoupment with respect to any liability or obligation owed to the HMO; and

 

3)         No agreement or interest securing the debentures, whether existing on the date of the debenture or subsequently entered, applies to the obligation under the debenture.

 

b)         The agreement shall bear interest either:

 

1)         At a fixed rate not exceeding the corporate base rate as reported by the largest bank (measured by assets) with its principal office located in Chicago, Illinois, in effect on the first business day of the month in which the subordinated indebtedness agreement is executed, plus 3% per annum; or

 

2)         At a variable rate equal to the corporate base rate determined on the first business day of each month during the term of the loan, plus 2% per annum.

 

c)         In no event shall the variable interest rate for any month exceed the initial rate for the loan or advance by more than 10% per annum. The HMO shall elect at the time of execution of the agreement whether the interest rate is to be fixed or floating for the term of the agreement.  The following shall be submitted for the Director's approval prior to execution of the subordinated indebtedness agreement:

 

1)         Duplicate copies of the entire subordinated indebtedness agreement.

 

2)         A certified copy of the resolution of the board of directors or the appropriate authoritative body of the HMO.  This resolution shall stipulate the maximum amount of subordinated indebtedness authorized.

 

d)         The Director shall be notified immediately in writing upon the execution of any subordinated indebtedness agreement as to the amount of the agreement and to whom payable.

 

e)         Accounting for the subordinated indebtedness on the HMO's financial statements shall be as follows:

 

1)         All outstanding subordinated indebtedness and interest accrued on the indebtedness shall be reported separately in the Annual Statement on page 3 and in any other financial statements of the company as a special surplus account.

 

2)         The issuance and repayment of the subordinated indebtedness, as well as the payment of the interest, shall be reflected as direct debits or credits to the net worth of the HMO's financial statement.

 

3)         The interest expense incurred on the subordinated indebtedness during the current period shall be reflected on the Statement of Revenue, Expenses and Net Worth of the HMO's financial statements.

 

f)         An HMO may only repay principal and make payment of interest on any subordinated indebtedness as provided under Section 2-9 of the Act.  No payment shall be authorized by the Director unless:

 

1)         The HMO's net worth is reasonable in relation to its outstanding liabilities and adequate for its financial needs; and

 

2)         The payment is consistent with the terms of the subordinated indebtedness agreement approved pursuant to subsection (a).

 

(Source:  Amended at 30 Ill. Reg. 4732, effective March 2, 2006)

 

Section 4521.80  Financial Reporting (Repealed)

 

(Source:  Repealed at 43 Ill. Reg. 9386, effective August 26, 2019)

 

Section 4521.90  Conflict of Interest and Required Disclosure

 

Each applicant for a Certificate of Authority shall file with the application, and shall immediately file any changes thereafter, disclosure of the following:

 

a)         Any contractual or financial arrangements between members of the Board of Directors/principal officers and the HMO, including:

 

1)         A description of any obligation, specified by contract or otherwise, to be met by each party in accordance with any such arrangements; and

 

2)         A listing of the dollar amounts of any consideration to be paid each party in accordance with any such arrangements.

 

b)         Any financial arrangements between members of the Board of Directors/principal officers and any provider or other person who also has a financial relationship with the HMO.  This disclosure shall include:

 

1)         A description of the obligations to be met by each party in accordance with any financial arrangements;

 

2)         A listing of the dollar amounts of the consideration to be paid each party in accordance with the arrangements; and

 

3)         A listing and description of any circumstances under which a director/principal officer is employed by or engages in a substantial commercial or professional relationship with any provider/other person.

 

c)         All directors, officers and executive directors, and/or any individual in a position of similar responsibility or any other individual, as required by the Director, shall submit a biographical statement in a form prescribed by the Director.

 

d)         A general description of the arrangements for providing compensation to agents.  For purposes of this subsection, compensation means any salary, commissions, incentives, emoluments, or any other item or event of value paid or payable to an agent and related to the performance of duties of an agent.

 

(Source:  Amended at 30 Ill. Reg. 4732, effective March 2, 2006)

 

Section 4521.100  Solicitation

 

a)         No HMO, or representative of the HMO, may cause or knowingly permit the use of advertising, solicitation, or any form of evidence of coverage that is untrue, misleading or deceptive.

 

1)         All information required to be disclosed pursuant to this Part shall set out conspicuously and in close conjunction with the statements to which the information relates under appropriate captions of the prominence that it shall not be minimized, rendered obscure or presented in an ambiguous fashion or intermingled with the context of the solicitation as to be confusing or misleading.

 

2)         The format and context of a solicitation of any HMO's plan or program shall be sufficiently complete and clear to avoid deception or the capacity or tendency to mislead or deceive.  Whether an advertisement has a capacity or tendency to mislead or deceive shall be determined by the Director from the overall impression that the advertisement may be reasonably expected to create upon a person of average education or intelligence within the segment of the public to which it is directed.

 

3)         Solicitations shall be truthful and not misleading in fact or implication.  Words or phrases, the meaning of which is clear only by employment or by familiarity with insurance, medical terminology or health care plans, shall not be used unless those words or phrases are otherwise explained in the solicitation.

 

4)         No solicitation shall omit information or use words, phrases, statements, references, or illustrations if an omission of the information or use of the words, phrases, statements, references or illustrations has the capacity, tendency or effect of misleading or deceiving prospective enrollees as to the nature or extent of any benefit payable, loss covered, premium payable or health care service provided.

 

b)         A detailed description of all training and educational programs provided to solicitors of the health care plan or to any person providing marketing activities shall be submitted to the Director upon application for a Certificate of Authority and any substantive changes in the programs shall be submitted to the Director 15 days prior to the intended effective date of the change.

 

c)         All brochures, media scripts, and any other marketing or advertising materials an HMO applying for Certificate of Authority plans to use must be filed with the Department.  The material must be filed before use and, in the event that the material can obviously not be filed, such as audiovisual presentations, a description of the solicitation activity must be filed.

 

d)         An advertisement or solicitation shall not directly or indirectly make unfair or incomplete comparisons of policies, plans, or benefits or comparisons of non-comparable plans or policies of other HMOs or insurers, and shall not disparage competitors, their policies or plans, services or business methods and shall not disparage or unfairly minimize a competing method of marketing insurance or health care services.

 

e)         No advertisement or marketing material of an HMO shall imply that certification by the Department is an endorsement of the HMO.

 

f)         An HMO shall provide its enrollees, no later than at the time of enrollment, or the time the individual contract or evidence of coverage is issued, lists of the names and locations of primary care physicians participating in the network applicable to the enrollee's benefit plan.  The lists shall disclose those providers who are not open for selection by the subscriber, as known to the HMO at the time the list is created.  The list shall also contain the following sentence in a prominent location:

 

NOTICE TO ENROLLEES:  While every provider listed in this document contracts with (the HMO) to provide primary care services, not every provider listed will be accepting new patients.  Although (the HMO) has identified those providers who were not accepting patients as known to (the HMO) at the time this (directory) was created, the status of any physician's practice may have changed.  For the most current information regarding the status of any physician's practice, please contact either the selected physician or (member services) at (phone number).

 

g)         Failure to comply with the requirements of this Section shall subject the HMO or its representative to corrective action the Director may order pursuant to Section 4-7 of the Act.

 

(Source:  Amended at 37 Ill. Reg. 14032, effective August 26, 2013)

 

Section 4521.110  Requirements for Group Contracts, Evidences of Coverage and Individual Contracts

 

a)         Any group contract, evidence of coverage, individual contract, enrollee handbook, enrollment application, identification card or other form that affects the terms and conditions applicable to the subscriber or enrollee in the provision of health care services must be filed with and approved by the Director prior to use in accordance with the filing requirements of Section 4521.112 of this Part and Section 4-13 of the Act.  The HMO shall issue to each subscriber or enrollee a group contract, evidence of coverage, or individual contract.  Any conflicting information between the valid current document referenced in this subsection issued to the subscriber or enrollee and the current group contract shall be interpreted according to whichever is most beneficial to the subscriber or enrollee.  Any group contract, evidence of coverage, or individual contract shall provide for the rendering of health care services as defined in that document for either a specific period of not less than 12 months from the date of issuance or for another period mutually agreed to by the HMO and the group or individual contractholder, and shall provide for renewal on a basis mutually agreed to by both parties, unless the HMO has given 31 days' written notice of nonrenewal prior to the renewal date of the contract.

 

b)         A detailed statement of any exceptions, exclusions, or limitations shall be set forth in the group contract, evidence of coverage, and individual contract for any type of health care service to be excepted.  Exception, exclusions, or limitations shall appear with the same prominence in the group contract, evidence of coverage, and individual contract as any benefit.

 

c)         The group contract, evidence of coverage, and individual contract shall set forth a detailed statement of the terms and conditions of maternity benefits and any related exceptions, exclusions, limitations, copayments, and deductibles.  Exceptions, exclusions, limitations, copayments, and deductibles applicable to prenatal and postnatal care shall be covered no differently than any other covered health care services provided pursuant to the contract, with the exception of a limitation for coverage of routine prenatal care or delivery when the enrollee is outside the service area against medical advice (except when the enrollee is outside of the service area due to circumstances beyond the enrollee's control) may be included in the group contract and evidence of coverage.

 

d)         Entire Contract.  The group contract, evidence of coverage, and individual contract shall contain a statement that the group contract evidence of coverage and individual contract, all applications, and any amendments shall constitute the entire agreement between the parties.  No portion of the charter, bylaws or other document of the HMO shall be part of a contract or evidence of coverage unless set forth in full in the document or attached to it.

 

e)         Eligibility Requirements.  The group contract, evidence of coverage, and individual contract shall contain eligibility requirements indicating the conditions that must be met to enroll in a health care plan, the limiting age for enrollees and eligible dependents including the effects of Medicare eligibility, and a clear statement regarding coverage of newborn children as set forth in Sections 4-8 and 4-9 of the Act.

 

f)         Benefits and Services Within the Service Area.  The group contract, evidence of coverage, and individual contract shall contain a specific description of benefits and services available within the HMO's designated service area.

 

g)         Emergency Care Services.  The group contract, evidence of coverage, and individual contract shall contain a specific description of benefits and services available for emergencies 24 hours per day, 7 days per week, including disclosure of any restrictions on emergency care services.  No group contract, evidence of coverage, or individual contract shall limit the coverage of emergency services within the service area to those providers having a contract with the HMO.

 

h)         Out-of-area Benefits and Services.  The group contract, evidence of coverage, and individual contract shall contain a specific description of benefits and services available out of the HMO's designated service area.

 

i)          Deductibles and Copayments 

 

1)         An HMO may require deductibles and copayments from enrollees as a condition for the receipt of specific health care services, including basic health care services.  Deductibles and copayments shall be the only allowable charge, other than premiums, assessed enrollees.  Nothing within this subsection (i) shall preclude the provider from charging reasonable administrative fees, such as service fees for checks returned for non-sufficient funds and missed appointments.

 

2)         Copayments and deductibles appearing in the policy shall be for specific dollar amounts or for specific percentages of the cost of the health care services.

 

3)         No combination of deductibles and copayments for basic health care services may exceed the annual maximum out-of-pocket expenses of a high-deductible health plan as defined in 26 U.S.C. 223.

 

4)         Deductibles and copayments applicable to supplemental health care services or catastrophic-only plans as defined under the federal Patient Protection and Affordable Care Act (Pub. L. 111-148), are not subject to the annual limitations described in this Section.

 

5)         This subsection (i) applies to enrollees and does not limit the health care plan payment for services provided by non-participating providers.

 

j)          Cancellation.  The group contract, evidence of coverage, and individual contract shall contain the conditions upon which they can be cancelled by the HMO or the enrollee as set forth in Section 4521.111.

 

k)         Reinstatement.  The group contract, evidence of coverage, and individual contract shall contain the conditions of the enrollee's right to reinstatement.

 

l)          Grace Period 

 

1)         A group contract or individual contract not involving the use of a premium tax credit shall provide for a grace period for the payment of any premium, except the first, during which coverage shall remain in effect if payment is made during the grace period.  The grace period for a group contract shall not be less than 10 days.  The grace period for an individual contract shall not be less than 31 days.  During the grace period, the HMO shall remain liable for providing the services and benefits contracted for.  The subscriber shall remain liable for the payment of the premium for the time coverage was in effect during the grace period and the enrollee shall remain liable for the payment of any applicable share of the premium for the time coverage was in effect, as well as for any copayments owed.

 

2)         Termination of coverage for individuals receiving advance payments of premium tax credits shall comply with the requirements of 45 CFR 155 and 45 CFR 156.270 (2020).

 

m)        No group contract, evidence of coverage, or individual contract may be delivered in this State unless the subscriber or enrollee is provided written notice required by Section 143c of the Illinois Insurance Code [215 ILCS 5/143c].

 

n)         Right to Examine Contract.  An individual contract, with the exception of an HMO Medicare contract entered into between the Health Care Financing Administration and the HMO under Title XVIII of the Social Security Act (42 U.S.C. 1395 through 1395lll), as amended from time to time, shall contain a provision stating that an enrollee who has entered into an agreement with an HMO shall be permitted to return the individual contract within ten days after receiving it and to receive a refund of the premium paid if the enrollee is not satisfied with the contract for any reason.  If the individual contract is returned to the HMO or to its representative through whom it was purchased, it is considered void from the beginning.  However, if services are rendered or claims are paid for the enrollee or dependent by the HMO during the 10-day examination period, the enrollee shall not be permitted to return the contract and receive a refund of the premium paid.

 

o)         An HMO Medicare contract entered into between the Health Care Financing Administration and the HMO under Title XVIII of the Social Security Act, as amended from time to time, shall be delivered to the enrollee at least 15 days prior to the effective date of the contract.  The enrollee shall be permitted to return the HMO Medicare contract prior to the effective date and to receive a refund of the premium paid if the enrollee is not satisfied with the contract for any reason, provided the enrollee complies with the disenrollment procedures of Title XVIII of the Social Security Act, as amended from time to time.

 

p)         Every HMO will provide to every enrollee of the HMO information that generally describes the philosophy, functions, and organization of the HMO and related institutions, and specific information that describes the appropriate use of the HMO's services, including a general description of benefits and limitations.  The HMO shall include in its enrollee information a description of the HMO's grievance procedure, directions for filing a grievance, and a Notice of Availability of the Department.

 

q)         Every HMO shall provide enrollees with an identification card that must prominently display the following information:

 

1)         the words "Health Maintenance Organization" or "HMO";

 

2)         disclaimer language concerning an enrollee's unauthorized use of providers not selected by the HMO;

 

3)         a current telephone number for the enrollees to use when health care services are required outside of normal office hours; and

 

4)         the name of all enrollees entitled to coverage, along with all other mandated information, if the HMO does not issue a card to each enrollee who is entitled to coverage.  In these situations, at least two cards must be issued to the primary enrollee upon enrollment and the HMO must issue additional cards to all enrollees at the request of the enrollee for no additional charge.  Notification of the right to order additional cards for no additional charge must be included with information required to be disseminated to enrollees under subsection (p).

 

r)          Enrollment Application.  No individual contract shall be issued except upon the signed enrollment application of the enrollee for whom coverage is being sought.  Any information or statement of the applicant shall appear on the application in the form of interrogatories by the HMO and answers by the applicant.  The enrollee shall not be bound by any statement made within an application for health care coverage unless a copy of the application is attached to the individual contract.  Group enrollment applications must be maintained on file by the HMO; otherwise, disputes arising from statements made within the applications will be resolved in the enrollee's favor.  Except for those instances involving fraud or material misrepresentation, an HMO's failure to investigate incomplete or conflicting answers on an enrollment application shall estop the HMO from subsequently denying coverage on the basis of those responses.

 

s)         Coordination of Benefits

 

1)         HMOs are permitted, but not required, to adopt coordination of benefits provisions for group contracts, evidence of coverage, or individual contracts to avoid over insurance and to provide for the orderly payment of claims when a person is covered by two or more group health insurance or health care plans.

 

2)         If an HMO adopts coordination of benefits, the provision must be consistent with the coordination of benefits requirements set forth in 50 Ill. Adm. Code 2009.

 

3)         To the extent necessary for an HMO to meet its obligations as a secondary carrier under 50 Ill. Adm. Code 2009, and when an enrollee has established a credit within the reserve bank, the HMO shall make payments for services that are:

 

A)        received from non-participating providers;

 

B)        provided outside its services areas; or

 

C)        not covered under the terms of health care plan.

 

t)          Dependents-termination of coverage-disability and dependency, proof-application.  Every group contract, evidence of coverage, or individual contract providing that coverage of a dependent person of an enrollee terminates upon attainment of the limiting age for dependent persons shall comply with the requirements of Section 4-9.1 of the Act.

 

u)         Conversion of Coverage

 

1)         The group contract and evidence of coverage shall contain a conversion provision that provides that each enrollee has the right to convert coverage to an individual or group HMO contract in the following circumstances:

 

A)        upon cancellation of eligibility for coverage under a group contract;

 

B)        upon cancellation of the group contract; or

 

C)        upon non-renewal of the group contract.

 

2)         The conversion contract shall cover the enrollee and the enrollee's eligible dependents who were covered by the group contract on the date of cancellation or non-renewal of coverage.  To obtain the conversion contract, an enrollee shall submit a written application, along with the application premium payment, within 31 days after the date the enrollee's coverage is cancelled.

 

3)         The HMO may require copayments and deductibles under a conversion contract that differ from the group contract.

 

4)         A conversion contract shall not be required to be made available if:

 

A)        The cancellation of the enrollee's coverage occurred for any of the reasons listed in Section 4521.111(a);

 

B)        The enrollee is covered by or is eligible for benefits under Title XVIII of the Social Security Act (42 U.S.C. 1395-1395lll);

 

C)        The enrollee is covered by similar hospital, medical, or surgical benefits under State or federal law;

 

D)        The enrollee is covered by similar hospital, medical, or surgical benefits under any arrangement of coverage for individuals in a group, whether on an insured or uninsured basis;

 

E)        The enrollee is covered for similar benefits through individual coverage;

 

F)         The enrollee has not been continuously covered during the three-month period immediately preceding cancellation of that person's coverage;

 

G)        The enrollee has moved outside of the service area of the health maintenance organization;

 

H)        The cancellation of the enrollee's coverage occurred in relation to the HMO being placed in rehabilitation or liquidation proceedings pursuant to Section 5-6 of the Act; or

 

I)         The group contract has been discontinued in its entirety and there is a succeeding carrier providing coverage to the group in its entirety.

 

5)         Benefits or coverage shall be considered "similar" if coverage is provided for at least 12 months under comprehensive type medical coverage.

 

6)         At a minimum, the conversion contract shall provide basic health care services.

 

7)         The conversion contract shall begin coverage of the enrollee and any dependents formerly covered under the group contract on the date of termination from the group or the former individual contract.

 

8)         Coverage shall be provided without requiring evidence of insurability and shall not impose any pre-existing condition limitations or exclusions.

 

v)         Discrimination between individuals of the same class in the terms and conditions of the health care plan, or in the amount charged for coverage under a health care plan except when the rate differential is based on sound actuarial principles, or in any other manner whatsoever, is prohibited.

 

w)        Grievance Procedure

The group contract, evidence of coverage, and individual contract shall set forth a full description of the HMO grievance procedure required by Section 4521.40.

 

x)         The provisions of 50 Ill. Adm. Code 2001, Subparts A and C, shall apply to this Part.

 

(Source:  Amended at 48 Ill. Reg. 7266, effective April 30, 2024)

 

Section 4521.111  Cancellation

 

a)         No HMO shall cancel a group or individual contract or evidence of coverage except for one or more of the following reasons:

 

1)         Failure of the enrollee to pay the amount due under the contract or evidence of coverage, for which the enrollee is legally responsible;

 

2)         Fraud or material misrepresentation in enrollment or in the use of services or facilities;

 

3)         Material violation of the terms of the contract or evidence of coverage;

 

4)         Failure of the enrollee and the primary care physician to establish a satisfactory patient-physician relationship if the enrollee has repeatedly refused to follow the plan of treatment ordered by the physician; it is shown that the HMO has in good faith provided the enrollee with the opportunity to select an alternative primary care physician; and the enrollee has been notified in writing at least 31 days in advance that the HMO considers such patient-physician relationship to be unsatisfactory;

 

5)         Under the Basic Outpatient Preventive and Primary Care Services for Children Program, failure to meet or continue to meet eligibility requirements as required by Section 4521.131 of this Part; or

 

6)         Other good cause agreed upon in the contract and approved by the Director pursuant to Section 4-13 of the Act.

 

b)         A group contract, evidence of coverage or individual contract may not be cancelled for any of the following reasons:

 

1)         The status of the enrollee's health;

 

2)         The enrollee has exercised his or her rights under the HMO's grievance system.

 

(Source:  Amended at 30 Ill. Reg. 4732, effective March 2, 2006)

 

Section 4521.112  Form Filing Requirements

 

Group contracts, evidences of coverage, individual contracts, enrollment applications or other forms that affect the terms and conditions applicable to the enrollee in the provision of health care services must be filed with the Department pursuant to 50 Ill. Adm. Code 916.  If the form is a revised version of a previously approved form, the HMO must provide the number of the previously approved form and the date it was approved by the Department, and highlight all changes from the previously approved form.  Any changes not highlighted will not be deemed to be approved.

 

(Source:  Amended at 37 Ill. Reg. 14032, effective August 26, 2013)

 

Section 4521.113  Point of Service Plan Requirements

 

a)         The filing as described in this subsection shall be comprised of an HMO filing and an indemnity filing.  The filing shall be coordinated by the HMO.  The filing must contain reasonable financial incentives for point of service members to utilize HMO services provided or arranged by the designated HMO primary care physician and shall include:

 

1)         Copies of all policy forms necessary to implement the point of service product, including the member handbook used to integrate the services provided by the HMO and the benefits provided by the indemnity carrier.

 

2)         Enrollment application and member identification card disclosing the names of both the HMO and indemnity carrier.

 

3)         Solicitation material.

 

4)         Copies of all contracts required by Section 4521.50 between the HMO and affiliated indemnity carrier detailing their respective responsibilities and obligations in offering a point of service product.

 

5)         The HMO shall include in its rate filing the rate level justification and a demonstration of how the out-of-network indemnity benefits to be provided by the affiliated indemnity carrier will impact on the HMO's rates and underlying utilization assumptions.  The documentation shall be deemed confidential by the Department unless specific authorization is given by the HMO.

 

6)         Written descriptions and illustrative flow charts of how the premium is received and distributed in a timely fashion and how claims will be handled for payment.

 

7)         A comparison of benefits offered by the HMO carrier and the indemnity carrier.

 

b)         Out-of-network claims shall be filed with the HMO.  The HMO is responsible for coordinating payment of all claims.

 

c)         Covered services rendered by a participating physician without proper authorization shall be covered at the out-of-network benefit level.

 

d)         For purposes of coordination of benefits, the two policies comprising the point of service product shall be considered to be one policy.

 

e)         For purposes of conversion and State continuation, the HMO shall provide each enrollee who has a POS plan the right to convert to either an HMO option or indemnity option.  The HMO may, but is not required to, offer the enrollee the right to continue under a POS option.  Once the enrollee has chosen an option, the other plan's options will no longer be available.  Should the enrollee choose to continue or convert coverage under a point of service plan, then the plan shall meet applicable standards for Illinois conversion or continuation requirements.  In the event of any inconsistency between these standards, then the most favorable to the enrollee shall apply.

 

(Source:  Amended at 37 Ill. Reg. 14032, effective August 26, 2013)

 

Section 4521.120  Internal Security Standards and Fidelity Bonds

 

The standards and provisions set forth in 50 Ill. Adm. Code 904 (Internal Security Standard and Fidelity Bonds) shall apply to HMOs.

 

(Source:  Amended at 30 Ill. Reg. 4732, effective March 2, 2006)

 

Section 4521.130  Basic Health Care Services

 

The provision of Basic Health Care Services shall not discriminate against any class of physician.  The following minimum standards shall meet the requirements for Basic Health Care Services, provided that services are medically necessary as determined by the enrollee's primary care physician and, if required by the HMO, are authorized on a prospective and timely basis by the HMO's Medical Director:

 

a)         Physician services, including primary care, consultation, referral, surgical, anesthesia or other as needed by the enrollee in any level of service delivery.  Physician services need not include organ transplants unless specifically authorized by a primary care physician and approved by the HMO's Medical Director;

 

b)         Outpatient diagnostic imaging, pathology services and radiation therapy;

 

c)         Non-mental health inpatient services, including all professional services, medications, surgically implanted devices and supplies used by the enrollee while an inpatient;

 

d)         Emergency services for accidental injury or emergency illness 24 hours per day, and 7 days per week.  Emergency services are covered benefits inside and out of the plan's service area.  Emergency treatment shall include outpatient visits and referrals for emergency mental health problems;

 

e)         Maternity care, including prenatal and post-natal care and care for complication of pregnancy of mother and care with respect to a newborn child from the moment of birth, which shall include the care and treatment of illness, injury, congenital defects, birth abnormalities and premature birth;

 

f)         Blood transfusion services, processing and the administration of whole blood and blood components and derivatives;

 

g)         Preventive health services as appropriate for the patient population, including a health evaluation program and immunizations to prevent or arrest the further manifestation of human illness or injury including but not limited to allergy injections and allergy serum.  A health evaluation program shall include at least periodic physical examinations and medical history, hearing and vision testing or screening, routine laboratory testing or screening, blood pressure testing, and uterine cervical cytological testing, and low dose mammography testing as required by Section 4-6.1 of the Act;

 

h)         45 days inpatient mental health care per year.  Care in a day hospital, residential non-hospital or intensive outpatient mode may be substituted on a two-to-one basis for inpatient hospital services as deemed appropriate by the primary care physician.  60 individual outpatient mental health care visits per enrollee per year, as appropriate for evaluation, short-term treatment and crisis intervention services.  Group outpatient mental health care visits may be substituted on a two-to-one basis for individual mental health care visits as deemed appropriate by the primary care physician;

 

i)          Alcoholism and Drug Abuse

 

1)         Diagnosis, detoxification and treatment of the medical complications of the abuse of or addiction to alcohol or drugs on either an inpatient or outpatient basis.

 

2)         Rehabilitation services on an inpatient basis, for up to 45 days inpatient care per year.  Care in a day hospital, residential non-hospital or intensive outpatient treatment mode may be substituted on a two-to-one basis for inpatient hospital services as deemed appropriate by the primary care physician.  60 individual outpatient care visits per enrollee per year as appropriate for evaluation, short-term treatment, and crisis intervention services.  Group outpatient care visits may be substituted on a two-to-one basis for individual outpatient visits as deemed appropriate by the primary care physician.  Prolonged rehabilitation services in a specialized inpatient or residential facility need not be a part of Basic Health Care Services;

 

j)          Outpatient Rehabilitative therapy (including but not limited to:  speech therapy, physical therapy, and occupational therapy directed at improving physical functioning of the member) up to 60 treatments per year for conditions which are expected to result in significant improvement within two months as determined by the primary care physician and if required by the HMO, are authorized on a prospective and timely basis by the HMO's Medical Director;

 

k)         Preventive services required pursuant to 42 USC 300gg-13;

 

l)          Essential health benefits as provided in 50 Ill. Adm. Code 2001.11;

 

m)        Additional minimum standards may apply under the ACA, including but not limited to plans required to provide Essential Health Benefits under sections 1302(a) and (b) and the Mental Health Parity and Addiction Equity Act (P.L. 110‑343).

 

(Source:  Amended at 38 Ill. Reg. 23437, effective November 25, 2014)

 

Section 4521.131  Basic Outpatient Preventive and Primary Health Care Services for Children

 

a)         Eligibility.

 

1)         A health maintenance organization may undertake to provide or arrange for and to pay for or reimburse the cost of basic outpatient preventive and primary health care services for children in Illinois who:

 

A)        are without health care coverage:

 

i)          through a parent's employment;

 

ii)         through failure to qualify for medical assistance under the Illinois Public Aid Code or failure to qualify for coverage under the State Children's Health Insurance Program of the Social Security Act as amended by the Balanced Budget Act of 1997, P.L. 105-33;

 

iii)        through any other health plan.  For purposes of this Section, health plan means a policy, contract, certificate or agreement offered by a carrier to provide, deliver, arrange for, pay for or reimburse any of the costs of health care services.  Health plan does not include accident-only, credit, dental, vision, Medicare supplement, partnership or traditional long-term care, or disability income insurance coverage issued as a supplement to liability insurance, worker's compensation or similar insurance, or automobile medical payment insurance or short-term and catastrophic health insurance policies, or a policy that pays on a cost-incurred basis, or student insurance;

 

iv)        due to a loss of medical assistance when a parent has moved from welfare to work and does not find employment that offers health care coverage;

 

B)        are 18 years of age or under;

 

C)        have resided in the State of Illinois for at least 30 days and continue to reside in the State of Illinois.

 

2)         The coverage will be made available to an adult on behalf of an enrollee.  For purposes of this Section, enrollee is defined as an eligible child on whose behalf the policy is purchased.  The financially responsible party (FRP) is the person or entity paying the premium on behalf of the enrollee.  The certificate and/or policy will be issued to the parent or legal guardian of the enrollee.  If the FRP and parent or legal guardian are different, both shall be listed on the face page of the certificate and/or policy.  The name of the enrollee shall also be listed on the face page of the certificate and/or policy.

 

b)         Required Basic Minimum Outpatient Preventive and Primary Health Care Services for Children to be Provided.  The following minimum standards shall meet the requirements for basic outpatient preventive and primary health care services to be provided under this subsection, provided that the services are medically necessary as determined by the enrollee's primary care physician, and if required by the HMO, are authorized on a prospective and timely basis by the HMO's medical director.

 

1)         Preventive health services provided by the enrollee's primary care physician in the office, as appropriate for the patient population, including a health evaluation program and immunizations to prevent or arrest the further manifestation of human illness or injury including, but not limited to, allergy injections and allergy serum.  The health evaluation program shall include at least periodic physical examinations and medical history, blood pressure testing, and uterine cervical cytological testing as required by Section 356u of the Illinois Insurance Code [215 ILCS 5/356u] as well as health education concerning appropriate health care practices;

 

2)         Basic or general physician services for illness or injury, provided by the enrollee's primary care physician in the office;

 

3)         Emergency services for accidental injury or emergency illness 24 hours per day, 7 days per week.  Emergency services are covered benefits inside and out of the plan's service area;

 

4)         Outpatient diagnostic x-rays and laboratory services provided, arranged or authorized by the enrollee's primary care physician.

 

c)         Supplemental Basic Health Care Services that may be Provided in Addition to Basic Outpatient Preventive and Primary Health Care Services for Children.  In addition to the minimum required health services listed in subsection (b), the HMO may offer Supplemental Basic Health Care Services, provided that the services are medically necessary as determined by the enrollee's primary care physician and, if required by the HMO, are authorized on a prospective and timely basis by the HMO's Medical Director.  Supplemental Basic Health Care Services includes any services listed in Section 4521.130 of this Part.  To the extent that Supplemental Basic Health Care Services are provided under this subsection, the minimum requirements of Section 4521.130 of this Part must be met for those services.

 

d)         Supplemental Services that may be Provided in Addition to Basic Outpatient Preventive and Primary Health Care Services for Children.  In addition to the Supplemental Basic Health Care Services provided in Section 4521.131(c) of this Section, the HMO may offer the following Supplemental Services:

 

1)         preventive dental services, including diagnostic services, x-rays and restorations (fillings);

 

2)         vision screening, including one pair of eyeglasses per year;

 

3)         prescription drugs.

 

e)         Copayments, Deductibles and Benefit Maximums for Basic Outpatient Preventive Services, Primary Health Care Services, Supplemental Basic Health Care Services and Supplemental Services for Children.  An HMO may require copayments of enrollees as a condition for the receipt of specific health care services under this Part.  Deductibles and copayments shall be the only allowable charge, other than premiums. Copayments shall be for a specific dollar amount.  Deductibles shall be either for a specific dollar amount or for a specific percentage of the cost of the health care service.  No single deductible or copayment for health services may exceed 25% of the usual and customary fee of the service to the HMO and must be waived when, in a calendar year, deductibles and copayments paid for the receipt of health care services exceed $500 per enrollee.  This subsection does not preclude the provider from charging reasonable administrative fees such as service fees for checks returned for non-sufficient funds and missed appointments.

 

f)         Necessary Disclosure Requirements.

 

1)         The policy or certificate issued under this Section shall prominently disclose all limitations, exclusions, copayments and deductibles. Such disclosure shall include, but is not limited to:

 

A)        A prominent statement on the first page of the policy or certificate, in either contrasting color or in boldface type at least equal to the size of type used for policy captions, as follows:

 

            "Notice to Buyer.  This is a limited benefit (policy) (certificate). Benefits provided are not intended to cover all of your medical expenses."

 

B)        Exclusion of inpatient hospital services.

 

C)        Statement that pre-existing conditions may not be excluded or limited.

 

D)        Exclusion of services that are not provided, arranged or authorized by the primary care physician, and if required by the HMO, are subject to authorization on a prospective and timely basis by the HMO's medical director, except for emergency services.

 

2)         In the event services are offered under this Section by the HMO and purchased on behalf of the enrollee, full disclosure of the scope of those limited benefits shall be prominently stated within the policy or certificate.

 

3)         Eligibility requirements shall be prominently disclosed in the policy or certificate.

 

4)         Terms of cancellation shall be prominently disclosed pursuant to Section 4521.111 of this Part.

 

g)         Advertising.  All advertising materials used to market policies pursuant to 50 Ill. Adm. Code 916 and/or certificates pursuant to this Part shall be filed and accepted by the Director in accordance with the requirements of Section 4-17 of the Act prior to use.

 

h)         Grace Period Extension.  For purposes of this Part, the grace periods of Section 4521.110(m) of this Part apply.  In the event an FRP, other than the parent or guardian, fails to pay the premium within the grace period, the parent or guardian will be so notified and be given an additional 30 days in which to pay the premium or obtain another FRP.

 

(Source:  Amended at 30 Ill. Reg. 4732, effective March 2, 2006)

 

Section 4521.132  Required Coverage for Reconstructive Surgery Following Mastectomies

 

a)         As required by the Federal Women's Health and Cancer Rights Act of 1998 (WHCRA) (42 USC 300gg-6, 300gg-52, incorporating 29 USC 1185(b)), every individual and group contract or evidence of coverage issued by a health maintenance organization that provides medical and surgical benefits with respect to a mastectomy shall provide, in a case of an enrollee who is receiving benefits in connection with a mastectomy and who elects breast reconstruction in connection with a mastectomy, coverage in a manner determined in consultation with the attending physician and the patient for:

 

1)         Reconstruction for the breast on which the mastectomy has been performed;

 

2)         Surgery and reconstruction of the other breast to produce a symmetrical appearance; and

 

3)         Prostheses and physical complications for all stages of mastectomy, including lymphedemas.

 

b)         This coverage may be subject to annual deductibles and coinsurance provisions as may be deemed appropriate and as are consistent with those established for other benefits under the plan coverage.  Written notice of the availability of coverage under this Part shall be delivered to the enrollee upon enrollment and annually thereafter.

 

c)         A health maintenance organization operating a health care plan shall provide notice to each enrollee under the plan regarding the coverage required by this Part.  The notice shall be in writing and prominently positioned in any literature or correspondence made available or distributed by the health maintenance organization and shall be transmitted the earlier of:

 

1)         In the next mailing made by the health maintenance organization to the enrollee;

 

2)         As part of any yearly informational packet sent to the enrollee.

 

d)         A health maintenance organization offering individual or group health insurance may not:

 

1)         Deny to an enrollee eligibility, or continued eligibility, to enroll or to renew coverage under the terms of the plan solely for the purpose of avoiding the requirements of this Part; or

 

2)         Penalize or otherwise reduce or limit the reimbursement of an attending provider or provide incentives (monetary or otherwise) to an attending provider to induce the provider to provide care to an enrollee in a manner inconsistent with this Part.

 

e)         Nothing in this Section shall be construed to prevent a health maintenance organization from negotiating the level and type of reimbursement with a provider for care provided in accordance with this Part.

 

(Source:  Amended at 30 Ill. Reg. 4732, effective March 2, 2006)

 

Section 4521.140  General Provisions

 

Every HMO, having been declared to be an entity to be regulated for the public good, shall take care to conduct all of its affairs within the declared Public Policy on Fair Employment.  The Congress of the United States and the General Assembly of Illinois have stated that discrimination in employment based upon race, color, religion, sex or national origin is illegal.  Every HMO will handle all matters relating to employment in the manner required by Section 2-102 of the Illinois Human Rights Act [775 ILCS 5/2-102] and Title VII of the Civil Rights Act of 1964 (42 USC 2000d et seq.) or any rule or regulation promulgated pursuant to either.

 

(Source:  Amended at 30 Ill. Reg. 4732, effective March 2, 2006)

 

Section 4521.141  HMO Producer Licensing Requirements

 

a)         HMO producer means an individual who solicits, negotiates, effects, procures, renews or continues enrollment in an HMO. The term HMO "producer" shall not include:

 

1)         any regular salaried officer or employee of an HMO or of a licensed HMO producer who devotes substantially all of his or her time to activities other than the solicitation of applications for HMO membership and receives no commission or other compensation directly dependent upon the business obtained and who does not solicit or accept from the public applications for membership;

 

2)         employers or their officers or employees or the trustees of any employee benefit plan to the extent that such employers, officers, employees, or trustees are engaged in the administration or operation of any program of employee benefits involving the use of membership in an HMO; provided that the employers, officers, employees, or trustees are not in any manner compensated directly or indirectly by the HMO issuing the HMO membership;

 

3)         banks or their officers and employees, to the extent that the banks, officers, and employees collect and remit charges by charging same against accounts of depositors on the orders of depositors.

 

b)         No persons may act as or hold themselves out to be an HMO producer unless duly licensed in accordance with the requirements of this Part.

 

c)         An individual applying for an HMO producer's license shall make application on a form specified by the Department and declare under penalty of refusal, suspension or revocation of the license that the statements made in the application are true, correct and complete to the best of the individual's knowledge and belief.  Before approving the application, the Director shall find that the individual:

 

1)         Is at least 18 years of age;

 

2)         Has not committed any act that is grounds for denial, suspension or revocation pursuant to Section 505.1 of the Illinois Insurance Code [215 ILCS 5/505.1];

 

3)         Has successfully passed the Class 1(b) examination as required by Section 494.1 of the Illinois Insurance Code [215 ILCS 5/494.1].

 

d)         The provisions of Article XXXI of the Illinois Insurance Code [215 ILCS 5/Art. XXXI] and the rules promulgated under that statute (50 Ill. Adm. Code:  Chapter I, Subchapter ii) shall be applicable to all HMO producers.

 

(Source:  Amended at 37 Ill. Reg. 14032, effective August 26, 2013)

 

Section 4521.142  Limited Insurance Representative Requirements − Public Aid and Medicare Enrollers

 

a)         No person may enroll recipients of Public Aid or Medicare in an HMO, either personally or by mail, unless the person is duly licensed by the Director  pursuant to this Part.

 

b)         The provisions of Article XXXI of the Illinois Insurance Code [215 ILCS 5/Art. XXXI.] and the regulations promulgated under that statute (50 Ill. Adm. Code:  Chapter I, Subchapter ii) shall be applicable to all HMO limited insurance representatives and HMO producers.

 

(Source:  Amended at 30 Ill. Reg. 4732, effective March 2, 2006)

 

Section 4521.150  Severability

 

If any Section, term or provision of this Part is adjudged invalid for any reason, that judgment shall not affect, impair or invalidate any other Section, term or provision of this Part and the remaining Sections, terms and provisions shall be and remain in full force and effect.

 

(Source:  Amended at 30 Ill. Reg. 4732, effective March 2, 2006)