SB3114 - 104th General Assembly
TRANSPARENCY IN DOWNCODING ACT
Last Action
Senate Sponsors
Sen. David Koehler - Julie A. Morrison - Cristina Castro - Robert Peters, Laura Fine, Andrew S. Chesney, Christopher Belt, Graciela Guzmán, Paul Faraci, Suzy Glowiak Hilton, Linda Holmes, Ram Villivalam, Mike Porfirio, Meg Loughran Cappel, Doris Turner, Sally J. Turner, Sue Rezin, Napoleon Harris, III, Rachel Ventura, Elgie R. Sims, Jr., Lakesia Collins, Michael W. Halpin and Mike Simmons
House Sponsors
(Rep. Sharon Chung)
Statutes Amended In Order of Appearance
New Act
Synopsis As Introduced
Creates the Transparency in Downcoding Act. Provides that the Act applies to certain policies of health insurance amended, delivered, issued, or renewed on or after the effective date of the Act, except for employee or employer self-insured health benefit plans under the federal Employee Retirement Income Security Act of 1974 and health care provided pursuant to the Workers' Compensation Act or the Workers' Occupational Diseases Act. Prohibits a health insurance issuer from using an automated process, system, or tool to downcode a claim; from downcoding a claim based solely on the reported diagnosis codes; and from using downcoding practices in a targeted or discriminatory manner against physicians who routinely treat patients with complex or chronic conditions. Requires downcoding decisions to be made by a physician licensed to practice medicine in all its branches in any United States jurisdiction and of the same or similar specialty as a physician who typically manages the medical condition or disease. Sets forth provisions concerning notification requirements for downcoded claims; the appeal process for downcoded claims; enforcement by the Department of Insurance; and penalties. Provides that any pattern or practice of discriminatory downcoding identified by the Director of Insurance or another regulatory authority shall be subject to enforcement actions, including fines, restitution, or suspension of the health insurance issuer's license in this State. Effective immediately.
Senate Floor Amendment No. 1
Adds reference to:
305 ILCS 5/5-5.12g new
Replaces everything after the enacting clause. Creates the Transparency in Downcoding Act. Provides that the Act applies to certain policies of health insurance amended, delivered, issued, or renewed on or after the effective date of the Act, except for employee or employer self-insured health benefit plans under the federal Employee Retirement Income Security Act of 1974 and health care provided pursuant to the Workers' Compensation Act or the Workers' Occupational Diseases Act. Establishes home rule provisions. Prohibits a health care payor from implementing any policy or using any algorithm or other automated process, system, or tool that bypasses the evaluation of all information included by the billing physician to downcode a claim. Provides that a health care payor may use an automated process to identify claims that may justify a downcoding determination. Provides that all downcoding determinations must be made or reviewed by a natural person using the most recently released American Medical Association Current Procedural Terminology coding guidelines and considering all information included by the billing provider on the claim submission in such determination. Prohibits a health care payor from downcoding a claim based solely on the reported diagnosis codes. Sets forth provisions concerning notification requirements and the dispute process for downcoded claims. Prohibits a health care payor from using downcoding practices in a targeted or discriminatory manner against physicians who routinely treat patients with complex or chronic conditions. Establishes administration and enforcement provisions. Amends the Illinois Public Aid Code. Provides that, notwithstanding any other provision of law to the contrary, all managed care organizations shall comply with the requirements of the Transparency in Downcoding Act. Effective January 1, 2028.
Senate Floor Amendment No. 2
Adds reference to:
305 ILCS 5/5-5.12g new
Replaces everything after the enacting clause. Creates the Transparency in Downcoding Act. Provides that, subject to federal requirements, the Act applies to certain policies of health insurance amended, delivered, issued, or renewed on or after the effective date of the Act, except for employee or employer self-insured health benefit plans under the federal Employee Retirement Income Security Act of 1974 and health care provided pursuant to the Workers' Compensation Act or the Workers' Occupational Diseases Act. Prohibits home rule units from regulating downcoding of medical claims in policies issued, amended, delivered, or renewed on or after January 1, 2028. Prohibits a health care payor from implementing any policy or using any algorithm or other automated process, system, or tool that bypasses the evaluation of all information included by the billing health care professional to downcode a claim. Provides that a health care payor may use an automated process to identify claims that may justify a downcoding determination. Provides that all downcoding determinations must be made or reviewed by a natural person following American Medical Association Current Procedural Terminology coding guidelines in effect at the time. Prohibits a health care payor from downcoding a claim based solely on the reported diagnosis codes. Sets forth provisions concerning notification requirements and the dispute process for downcoded claims. Prohibits a health care payor from using downcoding practices in a targeted or discriminatory manner against health care professionals who routinely treat patients with complex or chronic conditions. Establishes administration and enforcement provisions. Amends the Illinois Public Aid Code. Provides that, notwithstanding any other provision of law to the contrary, all managed care organizations shall comply with the requirements of the Transparency in Downcoding Act. Effective January 1, 2028.
Actions
| Date | Chamber | Action |
|---|---|---|
| 2/02/2026 | Senate | Filed with Secretary by Sen. David Koehler |
| 2/02/2026 | Senate | First Reading |
| 2/02/2026 | Senate | Referred to Assignments |
| 2/10/2026 | Senate | Assigned to Insurance |
| 2/17/2026 | Senate | Added as Chief Co-Sponsor Sen. Julie A. Morrison |
| 2/17/2026 | Senate | Added as Co-Sponsor Sen. Laura Fine |
| 2/17/2026 | Senate | Postponed - Insurance |
| 2/18/2026 | Senate | Added as Co-Sponsor Sen. Andrew S. Chesney |
| 2/19/2026 | Senate | Added as Co-Sponsor Sen. Christopher Belt |
| 2/19/2026 | Senate | Added as Co-Sponsor Sen. Graciela Guzmán |
| 2/24/2026 | Senate | Added as Co-Sponsor Sen. Paul Faraci |
| 2/24/2026 | Senate | Added as Co-Sponsor Sen. Suzy Glowiak Hilton |
| 2/25/2026 | Senate | Added as Co-Sponsor Sen. Linda Holmes |
| 2/25/2026 | Senate | Added as Co-Sponsor Sen. Ram Villivalam |
| 2/26/2026 | Senate | Added as Co-Sponsor Sen. Mike Porfirio |
| 2/26/2026 | Senate | Added as Co-Sponsor Sen. Meg Loughran Cappel |
| 2/26/2026 | Senate | Added as Chief Co-Sponsor Sen. Cristina Castro |
| 2/27/2026 | Senate | Added as Co-Sponsor Sen. Doris Turner |
| 3/03/2026 | Senate | Added as Chief Co-Sponsor Sen. Robert Peters |
| 3/03/2026 | Senate | Added as Co-Sponsor Sen. Sally J. Turner |
| 3/03/2026 | Senate | Postponed - Insurance |
| 3/04/2026 | Senate | Added as Co-Sponsor Sen. Sue Rezin |
| 3/05/2026 | Senate | Added as Co-Sponsor Sen. Napoleon Harris, III |
| 3/11/2026 | Senate | Do Pass as Amended Insurance; 010-000-000 |
| 3/11/2026 | Senate | Placed on Calendar Order of 2nd Reading March 12, 2026 |
| 3/12/2026 | Senate | Second Reading |
| 3/12/2026 | Senate | Placed on Calendar Order of 3rd Reading March 24, 2026 |
| 3/23/2026 | Senate | Added as Co-Sponsor Sen. Rachel Ventura |
| 3/26/2026 | Senate | Senate Floor Amendment No. 1 Filed with Secretary by Sen. David Koehler |
| 3/26/2026 | Senate | Senate Floor Amendment No. 1 Referred to Assignments |
| 3/26/2026 | Senate | Added as Co-Sponsor Sen. Elgie R. Sims, Jr. |
| 4/09/2026 | Senate | Added as Co-Sponsor Sen. Lakesia Collins |
| 4/14/2026 | Senate | Senate Floor Amendment No. 1 Assignments Refers to Insurance |
| 4/14/2026 | Senate | Senate Floor Amendment No. 1 Recommend Do Adopt Insurance; 011-000-000 |
| 4/17/2026 | Senate | Rule 2-10 Third Reading Deadline Established As May 8, 2026 |
| 5/06/2026 | Senate | Senate Floor Amendment No. 2 Filed with Secretary by Sen. David Koehler |
| 5/06/2026 | Senate | Senate Floor Amendment No. 2 Referred to Assignments |
| 5/08/2026 | Senate | Rule 2-10 Third Reading Deadline Established As May 15, 2026 |
| 5/12/2026 | Senate | Senate Floor Amendment No. 2 Assignments Refers to Insurance |
| 5/13/2026 | Senate | Senate Floor Amendment No. 2 Recommend Do Adopt Insurance; 013-000-000 |
| 5/14/2026 | Senate | Recalled to Second Reading |
| 5/14/2026 | Senate | Senate Floor Amendment No. 1 Adopted; Koehler |
| 5/14/2026 | Senate | Senate Floor Amendment No. 2 Adopted; Koehler |
| 5/14/2026 | Senate | Placed on Calendar Order of 3rd Reading |
| 5/14/2026 | Senate | Third Reading - Passed; 059-000-000 |
| 5/14/2026 | Senate | Added as Co-Sponsor Sen. Michael W. Halpin |
| 5/14/2026 | Senate | Added as Co-Sponsor Sen. Mike Simmons |
| 5/14/2026 | House | Arrived in House |
| 5/14/2026 | House | Chief House Sponsor Rep. Sharon Chung |