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91_HB0626eng
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1 AN ACT concerning the delivery of health care services,
2 amending named Acts.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 1. Short title. This Act may be cited as the
6 Managed Care Reform Act.
7 Section 5. Definitions. For purposes of this Act, the
8 following words shall have the meanings provided in this
9 Section, unless otherwise indicated:
10 "Adverse determination" means a determination by a
11 utilization review program that an admission, extension of a
12 stay, or other health care service has been reviewed and,
13 based on the information provided, is not medically
14 necessary.
15 "Clinical" means medical, nursing, or other health care
16 professional opinion, decision, or judgment.
17 "Clinical peer reviewer" or "clinical personnel" means:
18 (1) in the case of physician reviewers, a State
19 licensed physician who is of the same category in the
20 same or similar specialty as the health care provider who
21 typically manages the medical condition, procedure or
22 treatment under review; or
23 (2) in the case of non-physician reviewers, a State
24 licensed or registered health care professional who is in
25 the same profession and same or similar specialty as the
26 health care provider who typically manages the medical
27 condition, procedure, or treatment under review.
28 Nothing herein shall be construed to change any
29 statutorily defined scope of practice.
30 "Department" means the Department of Insurance.
31 "Director" means the Director of Insurance.
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1 "Emergency medical condition" means a medical condition
2 manifesting itself by acute symptoms of sufficient severity
3 (including but not limited to severe pain) such that a
4 prudent layperson, who possesses an average knowledge of
5 health and medicine, could reasonably expect the absence of
6 immediate medical attention to result in:
7 (1) placing the health of the individual (or, with
8 respect to a pregnant woman, the health of the woman or
9 her unborn child) in serious jeopardy;
10 (2) serious impairment to bodily functions; or
11 (3) serious dysfunction of any bodily organ or
12 part.
13 "Emergency medical screening examination" means a medical
14 screening examination and evaluation by a physician licensed
15 to practice medicine in all its branches or, to the extent
16 permitted by applicable laws, by other appropriate personnel
17 under the supervision of or in collaboration with a physician
18 licensed to practice medicine in all its branches to
19 determine whether the need for emergency services exists.
20 "Emergency services" means, with respect to an enrollee
21 of a managed care plan, transportation services and covered
22 inpatient and outpatient hospital services furnished by a
23 provider qualified to furnish those services that are needed
24 to evaluate or stabilize an emergency medical condition.
25 "Emergency services" does not refer to post-stabilization
26 medical services.
27 "Enrollee" means a person enrolled in a managed care
28 plan.
29 "Health care professional" means a physician, registered
30 professional nurse, or other person appropriately licensed or
31 registered pursuant to the laws of this State to provide
32 health care services.
33 "Health care provider" means a health care professional,
34 hospital, facility, or other person appropriately licensed or
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1 otherwise authorized to furnish health care services or
2 arrange for the delivery of health care services in this
3 State.
4 "Health care services" means any services included in the
5 furnishing to any individual of medical care, or the
6 hospitalization or incident to the furnishing of such care or
7 hospitalization as well as the furnishing to any person of
8 any and all other services for the purpose of preventing,
9 alleviating, curing, or healing human illness or injury
10 including home health and pharmaceutical services and
11 products.
12 "Informal policy or procedure" means a nonwritten policy
13 or procedure, the existence of which may be proven by an
14 admission of an authorized agent of a managed care plan or
15 statistical evidence supported by anecdotal evidence.
16 "Managed care plan" means a plan that establishes,
17 operates, or maintains a network of health care providers
18 that have entered into agreements with the plan to provide
19 health care services to enrollees where the plan has the
20 ultimate obligation to the enrollee to arrange for the
21 provision of or pay for services through:
22 (1) organizational arrangements for ongoing quality
23 assurance, utilization review programs, or dispute
24 resolution; or
25 (2) financial incentives for persons enrolled in
26 the plan to use the participating providers and
27 procedures covered by the plan.
28 A managed care plan may be established or operated by any
29 entity including, but not necessarily limited to, a licensed
30 insurance company, hospital or medical service plan, health
31 maintenance organization, limited health service
32 organization, preferred provider organization, third party
33 administrator, independent practice association, or employer
34 or employee organization.
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1 For purposes of this definition, "managed care plan"
2 shall not include the following:
3 (1) strict indemnity health insurance policies or
4 plans issued by an insurer that does not require approval
5 of a primary care provider or other similar coordinator
6 to access health care services;
7 (2) managed care plans that offer only dental or
8 vision coverage;
9 (3) employee or employer self-insured health
10 benefit plans preempted from State regulation under the
11 federal Employee Retirement Income Security Act of 1974;
12 (4) not-for-profit health maintenance organizations
13 in existence as of January 1, 1999 and affiliated with a
14 union which only extend coverage to union members; and
15 (5) health care provided pursuant to the Workers'
16 Compensation Act or the Workers' Occupational Diseases
17 Act.
18 "Medical director" means a physician licensed in any
19 state to practice medicine in all its branches appointed by a
20 managed care plan.
21 "Person" means a corporation, association, partnership,
22 limited liability company, sole proprietorship, or any other
23 legal entity.
24 "Physician" means a person licensed under the Medical
25 Practice Act of 1987.
26 "Post-stabilization medical services" means health care
27 services provided to an enrollee that are furnished in a
28 licensed hospital by a physician or health care provider that
29 is qualified to furnish such services, and determined to be
30 medically necessary and directly related to the emergency
31 medical condition following stabilization.
32 "Primary care" means the provision of a broad range of
33 personal health care services (preventive, diagnostic,
34 curative, counseling, or rehabilitative) in a manner that is
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1 accessible and comprehensive and coordinated by a physician
2 licensed to practice medicine in all its branches.
3 "Primary care physician" means a physician who has
4 contracted with a managed care plan to provide primary care
5 services as defined by the contract and who is a physician
6 licensed to practice medicine in all of its branches. Nothing
7 in this definition shall be construed to prohibit a managed
8 care plan from requiring a physician to meet a managed care
9 plan's criteria in order to coordinate access to health care.
10 "Stabilization" means, with respect to an emergency
11 medical condition, to provide such medical treatment of the
12 condition as may be necessary to assure, within reasonable
13 medical probability, that no material deterioration of the
14 condition is likely to result from or occur during the
15 transfer of the enrollee from a facility.
16 "Specialist" means a health care professional who
17 concentrates practice in a recognized specialty field of
18 care.
19 "Utilization review" means the evaluation of the medical
20 necessity, appropriateness, and efficiency of the use of
21 health care services, procedures, and facilities.
22 "Utilization review program" means a program established
23 by a person to perform utilization review.
24 Section 10. Disclosure of information.
25 (a) An enrollee, and upon request a prospective enrollee
26 prior to enrollment, shall be supplied with written
27 disclosure information, containing at least the information
28 specified in this Section, if applicable, which may be
29 incorporated into the member handbook or the enrollee
30 contract or certificate. All written descriptions shall be in
31 readable and understandable format, consistent with standards
32 developed for supplemental insurance coverage under Title
33 XVIII of the Social Security Act. The Department shall
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1 promulgate rules to standardize this format so that potential
2 enrollees can compare the attributes of the various managed
3 care plans. In the event of any inconsistency between any
4 separate written disclosure statement and the enrollee
5 contract or certificate, the terms of the enrollee contract
6 or certificate shall be controlling. The information to be
7 disclosed shall include, at a minimum, all of the following:
8 (1) A description of coverage provisions, health
9 care benefits, benefit maximums, including benefit
10 limitations, and exclusions of coverage, including the
11 definition of medical necessity used in determining
12 whether benefits will be covered.
13 (2) A description of all prior authorization or
14 other requirements for treatments, pharmaceuticals, and
15 services.
16 (3) A description of utilization review policies
17 and procedures used by the managed care plan, including
18 the circumstances under which utilization review will be
19 undertaken, the toll-free telephone number of the
20 utilization review program, the time frames under which
21 utilization review decisions must be made for
22 prospective, retrospective, and concurrent decisions, the
23 right to reconsideration, the right to an appeal,
24 including the expedited and standard appeals processes
25 and the time frames for those appeals, the right to
26 designate a representative, a notice that all denials of
27 claims will be made by clinical personnel, and that all
28 notices of denials will include information about the
29 basis of the decision and further appeal rights, if any.
30 (4) A description prepared annually of the types of
31 methodologies the managed care plan uses to reimburse
32 providers specifying the type of methodology that is used
33 to reimburse particular types of providers or reimburse
34 for the provision of particular types of services,
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1 provided, however, that nothing in this item should be
2 construed to require disclosure of individual contracts
3 or the specific details of any financial arrangement
4 between a managed care plan and a health care provider.
5 (5) An explanation of an enrollee's financial
6 responsibility for payment of premiums, coinsurance,
7 co-payments, deductibles, and any other charges, annual
8 limits on an enrollee's financial responsibility, caps on
9 payments for covered services and financial
10 responsibility for non-covered health care procedures,
11 treatments, or services provided within the managed care
12 plan.
13 (6) An explanation of an enrollee's financial
14 responsibility for payment when services are provided by
15 a health care provider who is not part of the managed
16 care plan or by any provider without required
17 authorization or when a procedure, treatment, or service
18 is not a covered health care benefit.
19 (7) A description of the grievance procedures to be
20 used to resolve disputes between a managed care plan and
21 an enrollee, including the right to file a grievance
22 regarding any dispute between an enrollee and a managed
23 care plan, the right to file a grievance orally when the
24 dispute is about referrals or covered benefits, the
25 toll-free telephone number that enrollees may use to file
26 an oral grievance, the time frames and circumstances for
27 expedited and standard grievances, the right to appeal a
28 grievance determination and the procedures for filing the
29 appeal, the time frames and circumstances for expedited
30 and standard appeals, the right to designate a
31 representative, a notice that all disputes involving
32 clinical decisions will be made by clinical personnel,
33 and that all notices of determination will include
34 information about the basis of the decision and further
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1 appeal rights, if any.
2 (8) A description of the procedure for providing
3 care and coverage 24 hours a day for emergency services.
4 The description shall include the definition of emergency
5 services, notice that emergency services are not subject
6 to prior approval, and an explanation of the enrollee's
7 financial and other responsibilities regarding obtaining
8 those services, including when those services are
9 received outside the managed care plan's service area.
10 (9) A description of procedures for enrollees to
11 select and access the managed care plan's primary and
12 specialty care providers, including notice of how to
13 determine whether a participating provider is accepting
14 new patients.
15 (10) A description of the procedures for changing
16 primary and specialty care providers within the managed
17 care plan.
18 (11) Notice that an enrollee may obtain a referral
19 to a health care provider outside of the managed care
20 plan's network or panel when the managed care plan does
21 not have a health care provider with appropriate training
22 and experience in the network or panel to meet the
23 particular health care needs of the enrollee and the
24 procedure by which the enrollee can obtain the referral.
25 (12) Notice that an enrollee with a condition that
26 requires ongoing care from a specialist may request a
27 standing referral to the specialist and the procedure for
28 requesting and obtaining a standing referral.
29 (13) Notice that an enrollee with (i) a
30 life-threatening condition or disease or (ii) a
31 degenerative or disabling condition or disease, either of
32 which requires specialized medical care over a prolonged
33 period of time, may request a specialist responsible for
34 providing or coordinating the enrollee's medical care and
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1 the procedure for requesting and obtaining the
2 specialist.
3 (14) A description of the mechanisms by which
4 enrollees may participate in the development of the
5 policies of the managed care plan.
6 (15) A description of how the managed care plan
7 addresses the needs of non-English speaking enrollees.
8 (16) Notice of all appropriate mailing addresses
9 and telephone numbers to be utilized by enrollees seeking
10 information or authorization.
11 (17) A listing by specialty, which may be in a
12 separate document that is updated annually, of the name,
13 address, and telephone number of all participating
14 providers, including facilities, and, in addition, in the
15 case of physicians, category of license and board
16 certification, if applicable.
17 (b) Upon request of an enrollee or prospective enrollee,
18 a managed care plan shall do all of the following:
19 (1) Provide a list of the names, business
20 addresses, and official positions of the members of the
21 board of directors, officers, controlling persons,
22 owners, and partners of the managed care plan.
23 (2) Provide a copy of the most recent annual
24 certified financial statement of the managed care plan,
25 including a balance sheet and summary of receipts and
26 disbursements and the ratio of (i) premium dollars going
27 to administrative expenses to (ii) premium dollars going
28 to direct care, prepared by a certified public
29 accountant. The Department shall promulgate rules to
30 standardize the information that must be contained in the
31 statement and the statement's format.
32 (3) Provide information relating to consumer
33 complaints compiled in accordance with subsection (b) of
34 Section 25 of this Act and the rules promulgated under
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1 this Act.
2 (4) Provide the procedures for protecting the
3 confidentiality of medical records and other enrollee
4 information.
5 (5) Allow enrollees and prospective enrollees to
6 inspect drug formularies used by the managed care plan
7 and disclose whether individual drugs are included or
8 excluded from coverage and whether a drug requires prior
9 authorization. An enrollee or prospective enrollee may
10 seek information as to the inclusion or exclusion of a
11 specific drug. A managed care plan need only release the
12 information if the enrollee or prospective enrollee or
13 his or her dependent needs, used, or may need or use the
14 drug.
15 (6) Provide a written description of the
16 organizational arrangements and ongoing procedures of the
17 managed care plan's quality assurance program.
18 (7) Provide a description of the procedures
19 followed by the managed care plan in making decisions
20 about the experimental or investigational nature of
21 individual drugs, medical devices, or treatments in
22 clinical trials.
23 (8) Provide individual health care professional
24 affiliations with participating hospitals, if any.
25 (9) Upon written request, provide specific written
26 clinical review criteria relating to a particular
27 condition or disease and, where appropriate, other
28 clinical information that the managed care plan might
29 consider in its utilization review; the managed care plan
30 may include with the information a description of how it
31 will be used in the utilization review process. An
32 enrollee or prospective enrollee may seek information as
33 to specific clinical review criteria. A managed care
34 plan need only release the information if the enrollee or
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1 prospective enrollee or his or her dependent has, may
2 have, or is at risk of contracting a particular condition
3 or disease.
4 (10) Provide the written application procedures and
5 minimum qualification requirements for health care
6 providers to be considered by the managed care plan.
7 (11) Disclose other information as required by the
8 Director.
9 (12) To the extent the information provided under
10 item (5) or (9) of this subsection is proprietary to the
11 managed care plan, the enrollee or prospective enrollee
12 shall only use the information for the purposes of
13 assisting the enrollee or prospective enrollee in
14 evaluating the covered services provided by the managed
15 care plan. Any misuse of proprietary data is prohibited,
16 provided that the managed care plan has labeled or
17 identified the data as proprietary.
18 (c) Nothing in this Section shall prevent a managed care
19 plan from changing or updating the materials that are made
20 available to enrollees or prospective enrollees.
21 (d) If a primary care provider ceases participation in
22 the managed care plan, the managed care plan shall provide
23 written notice within 15 business days from the date that the
24 managed care plan becomes aware of the change in status to
25 each of the enrollees who have chosen the provider as their
26 primary care provider. If an enrollee is in an ongoing course
27 of treatment with any other participating provider who
28 becomes unavailable to continue to provide services to the
29 enrollee and the managed care plan is aware of the ongoing
30 course of treatment, the managed care plan shall provide
31 written notice within 15 business days from the date that the
32 managed care plan becomes aware of the unavailability to the
33 enrollee. The notice shall also describe the procedures for
34 continuing care.
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1 (e) A managed care plan offering to indemnify enrollees
2 for non-participating provider services shall file a report
3 with the Director twice a year showing the percentage
4 utilization for the preceding 6 month period of
5 non-participating provider services in such form and
6 providing such other information as the Director shall
7 prescribe.
8 (f) The written information disclosure requirements of
9 this Section may be met by disclosure to one enrollee in a
10 household.
11 Section 15. General grievance procedure.
12 (a) A managed care plan shall establish and maintain a
13 grievance procedure, as described in this Act. Compliance
14 with this Act's grievance procedures shall satisfy a managed
15 care plan's obligation to provide grievance procedures under
16 any other State law or rules.
17 A copy of the grievance procedures, including all forms
18 used to process a grievance, shall be filed with the
19 Director. Any subsequent material modifications to the
20 documents also shall be filed. In addition, a managed care
21 plan shall file annually with the Director a certificate of
22 compliance stating that the managed care plan has established
23 and maintains, for each of its plans, grievance procedures
24 that fully comply with the provisions of this Act. The
25 Director has authority to disapprove a filing that fails to
26 comply with this Act or applicable rules.
27 (b) A managed care plan shall provide written notice of
28 the grievance procedure to all enrollees in the member
29 handbook and to an enrollee at any time that the managed care
30 plan denies access to a referral or determines that a
31 requested benefit is not covered pursuant to the terms of the
32 contract. In the event that a managed care plan denies a
33 service as an adverse determination, the managed care plan
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1 shall inform the enrollee or the enrollee's designee of the
2 appeal rights under this Act.
3 The notice to an enrollee describing the grievance
4 process shall explain the process for filing a grievance with
5 the managed care plan, the time frames within which a
6 grievance determination must be made, and the right of an
7 enrollee to designate a representative to file a grievance on
8 behalf of the enrollee. Information required to be disclosed
9 or provided under this Section must be provided in a
10 reasonable and understandable format.
11 The managed care plan shall assure that the grievance
12 procedure is reasonably accessible to those who do not speak
13 English.
14 (c) A managed care plan shall not retaliate or take any
15 discriminatory action against an enrollee because an enrollee
16 has filed a grievance or appeal or requested an external
17 independent review.
18 Section 20. Grievance review.
19 (a) The managed care plan may require an enrollee to
20 file a grievance in writing, by letter or by a grievance form
21 which shall be made available by the managed care plan,
22 however, an enrollee must be allowed to submit an oral
23 grievance in connection with (i) a denial of, or failure to
24 pay for, a referral or service or (ii) a determination as to
25 whether a benefit is covered pursuant to the terms of the
26 enrollee's contract. A grievance may also be filed by a
27 health care professional or health care provider. In
28 connection with the submission of an oral grievance, a
29 managed care plan shall, within 24 hours, reduce the
30 complaint to writing and give the enrollee written
31 acknowledgment of the grievance prepared by the managed care
32 plan summarizing the nature of the grievance and requesting
33 any information that the enrollee needs to provide before the
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1 grievance can be processed. The acknowledgment shall be
2 mailed within the 24-hour period to the enrollee, who shall
3 sign and return the acknowledgment, with any amendments and
4 requested information, in order to initiate the grievance.
5 The grievance acknowledgment shall prominently state that the
6 enrollee must sign and return the acknowledgment to initiate
7 the grievance. A managed care plan may elect not to require a
8 signed acknowledgment when no additional information is
9 necessary to process the grievance, and an oral grievance
10 shall be initiated at the time of the telephone call.
11 Except as authorized in this subsection, a managed care
12 plan shall designate personnel to accept the filing of an
13 enrollee's grievance by toll-free telephone no less than 40
14 hours per week during normal business hours and shall have a
15 telephone system available to take calls during other than
16 normal business hours and shall respond to all such calls no
17 later than the next business day after the call was recorded.
18 In the case of grievances subject to item (i) of subsection
19 (b) of this Section, telephone access must be available on a
20 24 hour a day, 7 day a week basis.
21 (b) Within 48 hours of receipt of a written grievance,
22 the managed care plan shall provide written acknowledgment of
23 the grievance, including the name, address, qualifying
24 credentials, and telephone number of the individuals or
25 department designated by the managed care plan to respond to
26 the grievance. All grievances shall be resolved in an
27 expeditious manner, and in any event, no more than (i) 24
28 hours after the receipt of all necessary information when a
29 delay would significantly increase the risk to an enrollee's
30 health or when extended health care services, procedures, or
31 treatments for an enrollee undergoing a course of treatment
32 prescribed by a health care provider are at issue, (ii) 15
33 days after the receipt of all necessary information in the
34 case of requests for referrals or determinations concerning
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1 whether a requested benefit is covered pursuant to the
2 contract, and (iii) 30 days after the receipt of all
3 necessary information in all other instances.
4 (c) The managed care plan shall designate one or more
5 qualified personnel to review the grievance. When the
6 grievance pertains to medical or clinical matters, the
7 personnel shall include, but not be limited to, one or more
8 appropriately licensed or registered health care
9 professionals. When the grievance pertains to non-medical or
10 non-clinical matters, the personnel making the determination
11 must have had no involvement in the initial determination and
12 be at a higher level than the personnel who made the initial
13 grievance determination.
14 (d) The notice of a determination of the grievance shall
15 be made in writing to the enrollee or to the enrollee's
16 designee. In the case of a determination made in conformance
17 with item (i) of subsection (b) of this Section, notice shall
18 be made by telephone directly to the enrollee with written
19 notice to follow within 2 business days.
20 (e) The notice of a determination shall include (i)
21 clear and detailed reasons for the determination, including
22 any contract basis for the determination, and the evidence
23 relied upon in making that determination, (ii) in cases where
24 the determination has a medical or clinical basis, the
25 medical or clinical criteria for the determination, and (iii)
26 the procedures for the filing of an appeal of the
27 determination, including a form for the filing of an appeal,
28 requesting an external independent review, and filing a
29 complaint with the Department of Insurance.
30 Section 25. Grievance and complaint registry.
31 (a) A managed care plan shall maintain a register
32 consisting of a written record of all grievances and
33 complaints initiated during the past 3 years. The register
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1 shall be maintained in a manner that is reasonably clear and
2 accessible to the Director.
3 (b) The Department shall maintain records concerning the
4 complaints filed against managed care plans with the
5 Department and shall require managed care plans to annually
6 report complaints made to and resolutions by managed care
7 plans in a manner determined by rule. The Department shall
8 make a summary of all data collected available upon request
9 and publish the summary on the World Wide Web.
10 (c) The Department shall maintain records on the number
11 of complaints filed against each managed care plan.
12 (d) The Department shall maintain records classifying
13 each complaint by whether the complaint was filed by:
14 (1) a consumer or enrollee;
15 (2) a physician or health care provider; or
16 (3) any other individual.
17 (e) The Department shall maintain records classifying
18 each complaint according to the nature of the complaint as it
19 pertains to a specific function of the managed care plan.
20 The complaints shall be classified under the following
21 categories:
22 (1) denial of care or treatment;
23 (2) denial of a diagnostic procedure;
24 (3) denial of a referral request;
25 (4) sufficient choice and accessibility of health
26 care providers;
27 (5) underwriting;
28 (6) marketing and sales;
29 (7) claims and utilization review;
30 (8) member services;
31 (9) provider relations; and
32 (10) miscellaneous.
33 (f) The Department shall maintain records classifying
34 the disposition of each complaint. The disposition of the
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1 complaint shall be classified in one of the following
2 categories:
3 (1) complaint referred to the managed care plan and
4 no further action necessary by the Department;
5 (2) no corrective action deemed necessary by the
6 Department; or
7 (3) corrective action taken by the Department.
8 (g) No Department publication or release of information
9 shall identify any enrollee, physician, health care provider,
10 or individual complainant.
11 Section 30. External independent review.
12 (a) If an enrollee's or enrollee's health care
13 professional's or health care provider's or designee's
14 request for a covered service or claim for a covered service
15 is denied under the grievance review under Section 20 because
16 the service is not viewed as medically necessary including,
17 but not limited to, denial of specific tests or procedures,
18 denial of referral to specialist physicians, denial of
19 hospitalization requests or length of stay requests, the
20 enrollee or enrollee's health care professional or health
21 care provider or designee may initiate an external
22 independent review.
23 The managed care plan shall seek to resolve all external
24 independent reviews in the most expeditious manner and shall
25 make a determination and provide notice no more than 24 hours
26 after the receipt of all necessary information when a delay
27 would significantly increase the risk to an enrollee's health
28 or when extended health care services, procedures, or
29 treatments for an enrollee undergoing a course of treatment
30 prescribed by a health care provider are at issue.
31 (b) Within 30 days after the enrollee receives written
32 notice of such an adverse decision, if the enrollee decides
33 to initiate an external independent review, the enrollee
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1 shall send to the managed care plan a written request for an
2 external independent review, including any material
3 justification or documentation to support the enrollee's
4 request for the covered service or claim for a covered
5 service.
6 (c) Within 30 days after the managed care plan receives
7 a request for an external independent review from an
8 enrollee, the managed care plan shall:
9 (1) provide a mechanism for jointly selecting an
10 external independent reviewer by the enrollee, primary
11 care physician, and managed care plan; and
12 (2) forward to the independent reviewer all medical
13 records and supporting documentation pertaining to the
14 case, a summary description of the applicable issues
15 including a statement of the managed care plan's
16 decision, and the criteria used and the medical or
17 clinical reasons for that decision.
18 (d) Within 5 days of receipt of all necessary
19 information, the independent reviewer or reviewers shall
20 evaluate and analyze the case and render a decision that is
21 based on whether or not the service or claim for the service
22 is medically necessary. The decision by the independent
23 reviewer or reviewers is final.
24 (e) Pursuant to subsection (c) of this Section, an
25 external independent reviewer shall:
26 (1) have no direct financial interest in or
27 connection to the case;
28 (2) for physician services, be State licensed
29 physicians who are board certified or board eligible by
30 the appropriate American Medical Specialty Board, if
31 applicable, and who are in the same or similar scope of
32 practice as a physician who typically manages the medical
33 condition, procedure, or treatment under review;
34 (3) for other health care professional services, be
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1 State licensed health care professionals with the same
2 category of license as the health care professional
3 recommending the services; and
4 (4) have not been informed of the specific identity
5 of the enrollee or the enrollee's treating provider.
6 (f) If an appropriate reviewer pursuant to subsection
7 (e) of this Section for a particular case is not on the list
8 established by the Director, the parties shall choose a
9 reviewer who is mutually acceptable.
10 Section 35. Independent reviewers.
11 (a) From information filed with the Director on or
12 before March 1 of each year, the Director of the Illinois
13 Department of Public Health shall compile a list of external
14 independent reviewers and organizations that represent
15 external independent reviewers from lists provided by managed
16 care plans and by any State and county public health
17 department and State professional associations that wish to
18 submit a list to the Director. The Director may consult with
19 other persons about the suitability of any reviewer or any
20 potential reviewer. The Director shall annually review the
21 list and add and remove names as appropriate. On or before
22 June 1 of each year, the Director shall publish the list in
23 the Illinois Register.
24 (b) The managed care plan shall be solely responsible
25 for paying the fees of the external independent reviewer who
26 is selected to perform the review.
27 (c) An external independent reviewer who acts in good
28 faith shall have immunity from any civil or criminal
29 liability or professional discipline as a result of acts or
30 omissions with respect to any external independent review,
31 unless the acts or omissions constitute wilful and wanton
32 misconduct. For purposes of any proceeding, the good faith
33 of the person participating shall be presumed.
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1 (d) The Director's decision to add a name to or remove a
2 name from the list of independent reviewers pursuant to
3 subsection (a) is not subject to administrative appeal or
4 judicial review.
5 Section 40. Health care professional applications and
6 terminations.
7 (a) A managed care plan shall, upon request, make
8 available and disclose to health care professionals written
9 application procedures and minimum qualification requirements
10 that a health care professional must meet in order to be
11 considered by the managed care plan. The managed care plan
12 shall consult with appropriately qualified health care
13 professionals in developing its qualification requirements.
14 (b) A managed care plan may not terminate a contract of
15 employment or refuse to renew a contract on the basis of any
16 action protected under Section 45 of this Act or solely
17 because a health care professional has:
18 (1) filed a complaint against the managed care
19 plan;
20 (2) appealed a decision of the managed care plan
21 including requesting an external independent review; or
22 (3) requested a hearing pursuant to this Section.
23 (c) A managed care plan shall provide to a health care
24 professional, in writing, the reasons for the contract
25 termination or non-renewal.
26 (d) A managed care plan shall provide an opportunity for
27 a hearing to any health care professional terminated by the
28 managed care plan, or non-renewed if the health care
29 professional has had a contract or contracts with the managed
30 care plan for at least 24 of the past 36 months.
31 (e) After the notice provided pursuant to subsection
32 (c), the health care professional shall have 21 days to
33 request a hearing, and the hearing must be held within 15
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1 days after receipt of the request for a hearing. The hearing
2 shall be held before a panel appointed by the managed care
3 plan.
4 The hearing panel shall be composed of 5 individuals, the
5 majority of whom shall be clinical peer reviewers and, to the
6 extent possible, in the same discipline and the same or
7 similar specialty as the health care professional under
8 review.
9 The hearing panel shall render a written decision on the
10 proposed action within 14 business days. The decision shall
11 be one of the following:
12 (1) reinstatement of the health care professional
13 by the managed care plan;
14 (2) provisional reinstatement subject to conditions
15 set forth by the panel; or
16 (3) termination of the health care professional.
17 The decision of the hearing panel shall be final.
18 A decision by the hearing panel to terminate a health
19 care professional shall be effective not less than 15 days
20 after the receipt by the health care professional of the
21 hearing panel's decision.
22 A hearing under this subsection shall provide the health
23 care professional in question with the right to examine
24 pertinent information, to present witnesses, and to ask
25 questions of an authorized representative of the plan.
26 (f) A managed care plan may terminate or decline to
27 renew a health care professional, without a prior hearing, in
28 cases involving imminent harm to patient care, a
29 determination of intentional falsification of reports to the
30 plan or a final disciplinary action by a state licensing
31 board or other governmental agency that impairs the health
32 care professional's ability to practice. A professional
33 terminated for one of the these reasons shall be given
34 written notice to that effect. Within 21 days after the
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1 termination, a health care professional terminated because of
2 imminent harm to patient care or a determination of
3 intentional falsification of reports to the plan shall
4 receive a hearing. The hearing shall be held before a panel
5 appointed by the managed care plan. The panel shall be
6 composed of 5 individuals the majority of whom shall be
7 clinical peer reviewers and, to the extent possible, in the
8 same discipline and the same or similar specialty as the
9 health care professional under review. The hearing panel
10 shall render a decision on the proposed action within 14
11 days. The panel shall issue a written decision either
12 supporting the termination or ordering the health care
13 professional's reinstatement. The decision of the hearing
14 panel shall be final.
15 If the hearing panel upholds the managed care plan's
16 termination of the health care professional under this
17 subsection, the managed care plan shall forward the decision
18 to the appropriate professional disciplinary agency in
19 accordance with subsection (b) of Section 65.
20 Any hearing under this subsection shall provide the
21 health care professional in question with the right to
22 examine pertinent information, to present witnesses, and to
23 ask questions of an authorized representative of the plan.
24 (g) For any hearing under this Section, because the
25 candid and conscientious evaluation of clinical practices is
26 essential to the provision of health care, it is the policy
27 of this State to encourage peer review by health care
28 professionals. Therefore, no managed care plan and no
29 individual who participates in a hearing or who is a member,
30 agent, or employee of a managed care plan shall be liable for
31 criminal or civil damages or professional discipline as a
32 result of the acts, omissions, decisions, or any other
33 conduct, direct or indirect, associated with a hearing panel,
34 except for wilful and wanton misconduct. Nothing in this
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1 Section shall relieve any person, health care provider,
2 health care professional, facility, organization, or
3 corporation from liability for his, her, or its own
4 negligence in the performance of his, her, or its duties or
5 arising from treatment of a patient. The hearing panel
6 information shall not be subject to inspection or disclosure
7 except upon formal written request by an authorized
8 representative of a duly authorized State agency or pursuant
9 to a court order issued in a pending action or proceeding.
10 (h) A managed care plan shall develop and implement
11 policies and procedures to ensure that health care
12 professionals are at least annually informed of information
13 maintained by the managed care plan to evaluate the
14 performance or practice of the health care professional. The
15 managed care plan shall consult with health care
16 professionals in developing methodologies to collect and
17 analyze health care professional data. Managed care plans
18 shall provide the information and data and analysis to health
19 care professionals. The information, data, or analysis shall
20 be provided on at least an annual basis in a format
21 appropriate to the nature and amount of data and the volume
22 and scope of services provided. Any data used to evaluate
23 the performance or practice of a health care professional
24 shall be measured against stated criteria and a comparable
25 group of health care professionals who use similar treatment
26 modalities and serve a comparable patient population. Upon
27 receipt of the information or data, a health care
28 professional shall be given the opportunity to explain the
29 unique nature of the health care professional's patient
30 population that may have a bearing on the health care
31 professional's data and to work cooperatively with the
32 managed care plan to improve performance.
33 (i) Any contract provision or procedure or informal
34 policy or procedure in violation of this Section violates the
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1 public policy of the State of Illinois and is void and
2 unenforceable.
3 Section 45. Prohibitions.
4 (a) No managed care plan or its subcontractors shall by
5 contract, written policy or written procedure, or informal
6 policy or procedure prohibit or restrict any health care
7 professional or provider from disclosing to any enrollee,
8 patient, designated representative or, where appropriate,
9 prospective enrollee, (hereinafter collectively referred to
10 as enrollee) any information that the professional or
11 provider deems appropriate regarding:
12 (1) a condition or a course of treatment with an
13 enrollee including the availability of other therapies,
14 consultations, or tests; or
15 (2) the provisions, terms, or requirements of the
16 managed care plan's products as they relate to the
17 enrollee, where applicable.
18 (b) No managed care plan or its subcontractors shall by
19 contract, written policy or procedure, or informal policy or
20 procedure prohibit or restrict any health care professional
21 or provider from filing a complaint, making a report, or
22 commenting to an appropriate governmental body regarding the
23 policies or practices of the managed care plan that the
24 provider believes may negatively impact upon the quality of,
25 or access to, patient care.
26 (c) No managed care plan or its subcontractors shall
27 retaliate against a health care professional or health care
28 provider who advocates for appropriate health care services
29 for patients. It is the public policy of the State of
30 Illinois that a health care professional or health care
31 provider be encouraged to advocate for medically appropriate
32 health care services for his or her patients. This Section
33 shall not be construed to prohibit a managed care plan from
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1 making a determination not to pay for a particular health
2 care service or to prohibit a medical group, independent
3 practice association, preferred provider organization,
4 foundation, hospital medical staff, hospital governing body
5 or managed care plan from enforcing reasonable peer review or
6 utilization review protocols or determining whether a health
7 care professional or health care provider has complied with
8 those protocols. Nothing in this Section shall be construed
9 to prohibit the governing body of a hospital or the hospital
10 medical staff from taking disciplinary actions against a
11 physician as authorized by law. Nothing in this Section shall
12 be construed to prohibit the Department of Professional
13 Regulation from taking disciplinary actions against a health
14 care professional or provider under the appropriate licensing
15 Act.
16 (d) No managed care plan or its subcontractors by
17 contract, written policy, or procedure shall contain any
18 clause attempting to transfer or transferring to a physician
19 or health care professional or provider by indemnification or
20 otherwise, any civil or professional liability relating to
21 activities, actions, or omissions of the managed care plan or
22 its officers, employees, or agents as opposed to those of the
23 health care provider. A managed care plan shall be
24 responsible for any civil or professional liability relating
25 to activities, actions, or omissions of the plan or its
26 officers, employees, or agents. If a physician or health
27 care professional or provider performs activities, such as
28 quality assurance or utilization review, on behalf of the
29 plan or its subcontractors, then the physician or health care
30 professional or provider is acting as agent of the plan.
31 Nothing in this Section shall relieve any person, health care
32 provider, health care professional, or facility from
33 liability for his, her, or its own negligence in the
34 performance of his, her, or its duties or arising from
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1 treatment of a patient.
2 (e) No contract between a managed care plan or its
3 subcontractors and a health care professional or provider
4 shall contain any incentive plan that includes specific
5 payment made directly, in any form, to a health care
6 professional or provider as an inducement to deny, reduce,
7 limit, or delay specific, medically necessary and appropriate
8 services provided with respect to a specific enrollee or
9 groups of enrollees with similar medical conditions. Nothing
10 in this Section shall be construed to prohibit contracts that
11 contain incentive plans that involve general payments, such
12 as capitation payments or shared-risk arrangements, that are
13 not tied to specific medical decisions involving specific
14 enrollees or groups of enrollees with similar medical
15 conditions. The payments rendered or to be rendered to
16 health care professionals or providers under these
17 arrangements shall be deemed confidential information.
18 (f) No managed care plan or its subcontractors shall by
19 contract, written policy or procedure, or informal policy or
20 procedure permit, allow, or encourage an individual or entity
21 to dispense a different drug in place of the drug or brand of
22 drug ordered or prescribed without the express permission of
23 the person ordering or prescribing, except this prohibition
24 does not prohibit the interchange of different brands of the
25 same generically equivalent drug product, as provided under
26 Section 3.14 of the Illinois Food, Drug and Cosmetic Act.
27 (g) Any contract provision, written policy or procedure,
28 or informal policy or procedure in violation of this Section
29 violates the public policy of the State of Illinois and is
30 void and unenforceable.
31 Section 50. Network of providers.
32 (a) At least once every 3 years, and upon application
33 for expansion of service area, a managed care plan shall
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1 obtain certification from the Director of Public Health that
2 the managed care plan maintains a network of health care
3 professionals, providers, and facilities adequate to meet the
4 comprehensive health needs of its enrollees and to provide an
5 appropriate choice of health care professionals and providers
6 sufficient to provide the services covered under its
7 enrollee's contracts by determining that:
8 (1) there are a sufficient number of geographically
9 accessible participating professionals, providers, and
10 facilities;
11 (2) there are opportunities to select from at least
12 3 primary care physicians pursuant to travel and distance
13 time standards, providing that these standards account
14 for the conditions of accessing physicians in rural
15 areas; and
16 (3) there are sufficient professionals or providers
17 in all covered areas of specialty practice to meet the
18 needs of the enrollment population.
19 (b) The following criteria shall be considered by the
20 Director of Public Health at the time of a review:
21 (1) professional-enrollee and provider-enrollee
22 ratios by specialty;
23 (2) primary care physician-enrollee ratios;
24 (3) safe and adequate staffing of health care
25 professionals or providers in all participating
26 facilities based on:
27 (A) severity of patient illness and functional
28 capacity;
29 (B) factors affecting the period and quality
30 of patient recovery; and
31 (C) any other factor substantially related to
32 the condition and health care needs of patients;
33 (4) geographic accessibility;
34 (5) the number of grievances filed by enrollees
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1 relating to waiting times for appointments,
2 appropriateness of referrals, and other indicators of a
3 managed care plan's capacity;
4 (6) hours of operation;
5 (7) the managed care plan's ability to provide
6 culturally and linguistically competent care to meet the
7 needs of its enrollee population; and
8 (8) the volume of technological and speciality
9 services available to serve the needs of enrollees
10 requiring technologically advanced or specialty care.
11 (c) A managed care plan shall report on an annual basis
12 the number of enrollees and the number of participating
13 professionals and providers in the managed care plan.
14 Section 55. Referral to specialists.
15 (a) All managed care plans that require each enrollee to
16 select a health care provider for any purpose including
17 coordination of care shall allow all enrollees to choose any
18 primary care physician licensed to practice medicine in all
19 its branches or any health care professional participating in
20 the managed care plan for that purpose. The managed care plan
21 shall provide the enrollee with a choice of licensed health
22 care professionals who are accessible and qualified.
23 (b) A managed care plan shall establish a procedure by
24 which an enrollee who has a condition that requires ongoing
25 care from a specialist physician or health care professional
26 may apply for a standing referral to a specialist physician
27 or health care professional if a referral to a specialist
28 physician or health care professional is required for
29 coverage. The application shall be made to the enrollee's
30 primary care physician. This procedure for a standing
31 referral must specify the necessary criteria and conditions
32 that must be met in order for an enrollee to obtain a
33 standing referral. A standing referral shall be effective for
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1 the period necessary to provide the referred services or one
2 year. A primary care physician may renew a standing referral.
3 (c) The enrollee may be required by the managed care
4 plan to select a specialist physician or health care
5 professional who has a referral arrangement with the
6 enrollee's primary care physician or to select a new primary
7 care physician who has a referral arrangement with the
8 specialist physician or health care professional chosen by
9 the enrollee. If a managed care plan requires an enrollee to
10 select a new physician under this subsection, the managed
11 care plan must provide the enrollee with both options
12 provided in this subsection.
13 (d) When the type of specialist physician or other
14 health care provider needed to provide ongoing care for a
15 specific condition does not have a referral arrangement with
16 the enrollee's primary care physician, the primary care
17 physician shall arrange for the enrollee to have access to a
18 qualified health care provider in the plan's provider network
19 who is within a reasonable distance and travel time. When the
20 type of specialist physician or health care professional
21 needed to provide ongoing care for a specific condition is
22 not represented in the managed care plan's network of
23 physicians or health care professionals, the primary care
24 physician shall arrange for the enrollee to have access to a
25 qualified non-participating physician or health care
26 professional within a reasonable distance and travel time at
27 no additional cost to the enrollee beyond what the enrollee
28 would otherwise pay for services received within the plan's
29 network.
30 (e) The enrollee's primary care physician shall remain
31 responsible for coordinating the care of an enrollee who has
32 received a standing referral to a specialist physician or
33 health care professional. If a secondary referral is
34 necessary, the specialist physician or health care
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1 professional shall advise the primary care physician. The
2 primary care physician shall be responsible for making the
3 secondary referral. In addition, the managed care plan shall
4 require the specialist physician or health care professional
5 to provide regular updates to the enrollee's primary care
6 physician.
7 (f) If an enrollee's application for any referral is
8 denied, an enrollee may appeal the decision through the
9 managed care plan's external independent review process in
10 accordance with Section 30 of this Act.
11 Section 60. Transition of services.
12 (a) A managed care plan shall provide for continuity of
13 care for its enrollees as follows:
14 (1) If an enrollee's physician leaves the managed
15 care plan's network of physicians or health care
16 professionals for reasons other than termination of a
17 contract in situations involving imminent harm to a
18 patient or a final disciplinary action by a State
19 licensing board and the physician remains within the
20 managed care plan's service area, the managed care plan
21 shall permit the enrollee to continue an ongoing course
22 of treatment with that physician during a transitional
23 period:
24 (A) of at least 90 days from the date of the
25 notice of physician's termination from the managed
26 care plan to the enrollee of the physician's
27 disaffiliation from the managed care plan if the
28 enrollee has an ongoing course of treatment; or
29 (B) if the enrollee has entered the second
30 trimester of pregnancy at the time of the
31 physician's disaffiliation, that includes the
32 provision of post-partum care directly related to
33 the delivery.
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1 (2) Notwithstanding the provisions in item (1) of
2 this subsection, such care shall be authorized by the
3 managed care plan during the transitional period only if
4 the physician agrees:
5 (A) to continue to accept reimbursement from
6 the managed care plan at the rates applicable prior
7 to the start of the transitional period;
8 (B) to adhere to the managed care plan's
9 quality assurance requirements and to provide to the
10 managed care plan necessary medical information
11 related to such care; and
12 (C) to otherwise adhere to the managed care
13 plan's policies and procedures, including but not
14 limited to procedures regarding referrals and
15 obtaining preauthorizations for treatment.
16 (b) A managed care plan shall provide for continuity of
17 care for new enrollees as follows:
18 (1) If a new enrollee whose physician is not a
19 member of the managed care plan's physician or
20 professional network, but is within the managed care
21 plan's service area, enrolls in the managed care plan,
22 the managed care plan shall permit the enrollee to
23 continue an ongoing course of treatment with the
24 enrollee's current physician during a transitional
25 period:
26 (A) of at least 90 days from the effective
27 date of enrollment if the enrollee has an ongoing
28 course of treatment; or
29 (B) if the enrollee has entered the second
30 trimester of pregnancy at the effective date of
31 enrollment, that includes the provision of
32 post-partum care directly related to the delivery.
33 (2) If an enrollee elects to continue to receive
34 care from such physician pursuant to item (1) of this
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1 subsection, such care shall be authorized by the managed
2 care plan for the transitional period only if the
3 physician agrees:
4 (A) to accept reimbursement from the managed
5 care plan at rates established by the managed care
6 plan; such rates shall be the level of reimbursement
7 applicable to similar physicians within the managed
8 care plan for such services;
9 (B) to adhere to the managed care plan's
10 quality assurance requirements and to provide to the
11 managed care plan necessary medical information
12 related to such care; and
13 (C) to otherwise adhere to the managed care
14 plan's policies and procedures including, but not
15 limited to procedures regarding referrals and
16 obtaining preauthorization for treatment.
17 (c) In no event shall this Section be construed to
18 require a managed care plan to provide coverage for benefits
19 not otherwise covered or to diminish or impair preexisting
20 condition limitations contained in the enrollee's contract.
21 Section 65. Duty to report.
22 (a) A managed care plan shall report to the appropriate
23 professional disciplinary agency, after compliance and in
24 accordance with the provisions of this Section:
25 (1) termination of a health care provider contract
26 for commission of an act or acts that may directly
27 threaten patient care, and not of an administrative
28 nature, or that a person may be mentally or physically
29 disabled in such a manner as to endanger a patient under
30 that person's care;
31 (2) voluntary or involuntary termination of a
32 contract or employment or other affiliation with the
33 managed care plan to avoid the imposition of disciplinary
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1 measures.
2 The managed care plan shall only make the report after it
3 has provided the health care professional with a hearing on
4 the matter. (This hearing shall not impair or limit the
5 managed care plan's ability to terminate the professional.
6 Its purpose is solely to ensure that a sufficient basis
7 exists for making the report.) The hearing shall be held
8 before a panel appointed by the managed care plan. The
9 hearing panel shall be composed of 5 persons appointed by the
10 plan, the majority of whom shall be clinical peer reviewers,
11 to the extent possible, in the same discipline and the same
12 specialty as the health care professional under review. The
13 hearing panel shall determine whether the proposed basis for
14 the report is supported by a preponderance of the evidence.
15 The panel shall render its determination within 14 days. If
16 a majority of the panel finds the proposed basis for the
17 report is supported by a preponderance of the evidence, the
18 managed care plan shall make the required report within 21
19 days.
20 Any hearing under this Section shall provide the health
21 care professional in question with the right to examine
22 pertinent information, to present witnesses, and to ask
23 questions of an authorized representative of the plan.
24 If a hearing has been held pursuant to subsection (f) of
25 Section 40 and the hearing panel sustained a plan's
26 termination of a health care professional, no additional
27 hearing is required, and the plan shall make the report
28 required under this Section.
29 (b) Reports made pursuant to this Section shall be made
30 in writing to the appropriate professional disciplinary
31 agency. Written reports shall include the name, address,
32 profession, and license number of the individual and a
33 description of the action taken by the managed care plan,
34 including the reason for the action and the date thereof, or
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1 the nature of the action or conduct that led to the
2 resignation, termination of contract, or withdrawal, and the
3 date thereof.
4 For any hearing under this Section, because the candid
5 and conscientious evaluation of clinical practices is
6 essential to the provision of health care, it is the policy
7 of this State to encourage peer review by health care
8 professionals. Therefore, no managed care plan and no
9 individual who participates in a hearing or who is a member,
10 agent, or employee of a managed care plan shall be liable for
11 criminal or civil damages or professional discipline as a
12 result of the acts, omissions, decisions, or any other
13 conduct, direct or indirect, associated with a hearing panel,
14 except for wilful and wanton misconduct. Nothing in this
15 Section shall relieve any person, health care provider,
16 health care professional, facility, organization, or
17 corporation from liability for his, her, or its own
18 negligence in the performance of his, her, or its duties or
19 arising from treatment of a patient. The hearing panel
20 information shall not be subject to inspection or disclosure
21 except upon formal written request by an authorized
22 representative of a duly authorized State agency or pursuant
23 to a court order issued in a pending action or proceeding.
24 Section 70. Disclosure of information.
25 (a) A health care professional affiliated with a managed
26 care plan shall make available, upon request, in written form
27 at his or her office, to his or her patients or prospective
28 patients the following:
29 (1) information related to the health care
30 professional's educational background, experience,
31 training, specialty and board certification, if
32 applicable, number of years in practice, and hospitals
33 where he or she has privileges;
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1 (2) information regarding the health care
2 professional's participation in continuing education
3 programs and compliance with any licensure,
4 certification, or registration requirements, if
5 applicable; and
6 (3) the location of the health care professional's
7 primary practice setting and the identification of any
8 translation services available.
9 Section 75. Utilization review program registration.
10 (a) No person may conduct a utilization review program
11 in this State unless once every 2 years the person registers
12 the utilization review program with the Department and
13 certifies compliance with all of the Health Utilization
14 Management Standards of the American Accreditation Healthcare
15 Commission (URAC) or submits evidence of accreditation by the
16 American Accreditation Healthcare Commission (URAC) for its
17 Health Utilization Management Standards.
18 (b) The Director, in consultation with the Director of
19 Public Health, may certify alternative utilization review
20 standards of national accreditation organizations or entities
21 in order for plans to comply with this Section. Any
22 alternative utilization review standards shall meet or exceed
23 those standards required under subsection (a). In addition,
24 the Director, in consultation with the Director of Public
25 Health, may adopt additional utilization review requirements
26 by rule.
27 (c) The provisions of this Section do not apply to:
28 (1) persons providing utilization review program
29 services only to the federal government;
30 (2) self-insured managed care plans preempted from
31 State regulation under the federal Employee Retirement
32 Income Security Act of 1974, however, this Section does
33 apply to persons conducting a utilization review program
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1 on behalf of these managed care plans; and
2 (3) hospitals and medical groups performing
3 utilization review activities for internal purposes
4 unless the utilization review program is conducted for
5 another person.
6 Nothing in this Act prohibits a managed care plan or
7 other entity from contractually requiring an entity
8 designated in item (3) of this subsection to adhere to the
9 utilization review program requirements of this Act.
10 (d) This registration shall include submission of all of
11 the following information regarding utilization review
12 program activities:
13 (1) The name, address, and telephone of the
14 utilization review programs.
15 (2) The organization and governing structure of the
16 utilization review programs.
17 (3) The number of lives for which utilization
18 review is conducted by each utilization review program.
19 (4) Hours of operation of each utilization review
20 program.
21 (5) Description of the grievance process for each
22 utilization review program.
23 (6) Number of covered lives for which utilization
24 review was conducted for the previous calendar year for
25 each utilization review program.
26 (7) Written policies and procedures for protecting
27 confidential information according to applicable State
28 and federal laws for each utilization review program.
29 (e) The Department shall investigate utilization review
30 program compliance with the requirements of this Section. If
31 the Department finds that a utilization review program is not
32 in compliance with this Section, the Department shall issue a
33 corrective action plan and allow a reasonable amount of time
34 for compliance with the plan. If the utilization review
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1 program does not come into compliance, the Department may
2 issue a cease and desist order. Before issuing a cease and
3 desist order under this Section, the Department shall provide
4 the utilization review program with a written notice of the
5 reasons for the order and allow a reasonable amount of time
6 to supply additional information demonstrating compliance
7 with requirements of this Section and to request a hearing.
8 The hearing notice shall be sent by certified mail, return
9 receipt requested, and the hearing shall be conducted in
10 accordance with the Illinois Administrative Procedure Act.
11 (f) A utilization review program subject to a corrective
12 action may continue to conduct business until a final
13 decision has been issued by the Department.
14 Section 80. Appeal of adverse determinations by
15 utilization review programs.
16 (a) An enrollee, the enrollee's designee, and, in
17 connection with retrospective adverse determinations, the
18 enrollee's health care provider may appeal an adverse
19 determination rendered by a utilization review program
20 pursuant to Sections 15, 20, and 30.
21 (b) A utilization review program shall establish
22 mechanisms that facilitate resolution of the appeal
23 including, but not limited to, the sharing of information
24 from the enrollee's health care provider and the utilization
25 review program by telephonic means or by facsimile. The
26 utilization review program shall provide reasonable access to
27 its clinical peer reviewer in a prompt manner.
28 (c) Appeals shall be reviewed by a clinical peer
29 reviewer other than the clinical peer reviewer who rendered
30 the adverse determination.
31 Section 85. Required and prohibited practices.
32 (a) A utilization review program shall have written
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1 procedures for assuring that patient-specific information
2 obtained during the process of utilization review will be:
3 (1) kept confidential in accordance with applicable
4 State and federal laws; and
5 (2) shared only with the enrollee, the enrollee's
6 designee, the enrollee's health care provider, and those
7 who are authorized by law to receive the information.
8 (b) Summary data shall not be considered confidential
9 if it does not provide information to allow identification of
10 individual patients.
11 (c) Any health care professional who makes
12 determinations regarding the medical necessity of health care
13 services during the course of utilization review shall be
14 appropriately licensed or registered.
15 (d) A utilization review program shall not, with respect
16 to utilization review activities, permit or provide
17 compensation or anything of value to its employees, agents,
18 or contractors based on:
19 (1) either a percentage of the amount by which a
20 claim is reduced for payment or the number of claims or
21 the cost of services for which the person has denied
22 authorization or payment; or
23 (2) any other method that encourages the rendering
24 of an adverse determination.
25 (e) If a health care service has been specifically
26 pre-authorized or approved for an enrollee by a utilization
27 review program, a utilization review program shall not,
28 pursuant to retrospective review, revise or modify the
29 specific standards, criteria, or procedures used for the
30 utilization review for procedures, treatment, and services
31 delivered to the enrollee during the same course of
32 treatment.
33 (f) Utilization review shall not be conducted more
34 frequently than is reasonably required to assess whether the
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1 health care services under review are medically necessary.
2 The Department may promulgate rules governing the frequency
3 of utilization reviews for managed care plans of differing
4 size and geographic location.
5 (g) When making prospective, concurrent, and
6 retrospective determinations, utilization review programs
7 shall collect only information that is necessary to make the
8 determination and shall not routinely require health care
9 providers to numerically code diagnoses or procedures to be
10 considered for certification, unless required under State or
11 federal Medicare or Medicaid rules or regulations, or
12 routinely request copies of medical records of all patients
13 reviewed. During prospective or concurrent review, copies of
14 medical records shall only be required when necessary to
15 verify that the health care services subject to the review
16 are medically necessary. In these cases, only the necessary
17 or relevant sections of the medical record shall be required.
18 A utilization review program may request copies of partial or
19 complete medical records retrospectively.
20 (h) In no event shall information be obtained from
21 health care providers for the use of the utilization review
22 program by persons other than health care professionals,
23 medical record technologists, or administrative personnel who
24 have received appropriate training.
25 (i) The utilization review program shall not undertake
26 utilization review at the site of the provision of health
27 care services unless the utilization review program staff
28 person:
29 (1) identifies himself or herself by name and the
30 name of his or her organization, including displaying
31 photographic identification that includes the name of the
32 utilization review program and staff person and clearly
33 identifies the individual as representative of the
34 utilization review program;
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1 (2) whenever possible, schedules review at least
2 one business day in advance with the appropriate health
3 care provider;
4 (3) if requested by a health care provider, assures
5 that the on-site review staff register with the
6 appropriate contact person, if available, prior to
7 requesting any clinical information or assistance from
8 the health care provider; and
9 (4) obtains consent from the enrollee or the
10 enrollee's designee before interviewing the patient's
11 family or observing any health care service being
12 provided to the enrollee.
13 This subsection does not apply to health care
14 professionals engaged in providing care, case management, or
15 making on-site discharge decisions.
16 (j) A utilization review program shall not base an
17 adverse determination on a refusal to consent to observing
18 any health care service.
19 (k) A utilization review program shall not base an
20 adverse determination on lack of reasonable access to a
21 health care provider's medical or treatment records unless
22 the utilization review program has provided reasonable notice
23 to both the enrollee or the enrollee's designee and the
24 enrollee's health care provider and has complied with all
25 provisions of subsection (i) of this Section. The Department
26 may promulgate rules defining reasonable notice and the time
27 period within which medical and treatment records must be
28 turned over.
29 (l) Neither the utilization review program nor the
30 entity for which the program provides utilization review
31 shall take any action with respect to a patient or a health
32 care provider that is intended to penalize the enrollee, the
33 enrollee's designee, or the enrollee's health care provider
34 for, or to discourage the enrollee, the enrollee's designee,
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1 or the enrollee's health care provider from, undertaking an
2 appeal, dispute resolution, or judicial review of an adverse
3 determination.
4 (m) In no event shall an enrollee, an enrollee's
5 designee, an enrollee's health care provider, any other
6 health care provider, or any other person or entity be
7 required to inform or contact the utilization review program
8 prior to the provision of emergency services as defined in
9 this Act.
10 (n) A health care professional providing health care
11 services to an enrollee shall be prohibited from serving as
12 the clinical peer reviewer for that enrollee in connection
13 with the health care services being provided to the enrollee.
14 Section 90. Annual consumer satisfaction survey. The
15 Director shall develop and administer a survey of persons who
16 have been enrolled in a managed care plan in the most recent
17 calendar year to collect information on relative plan
18 performance including, but not limited to, arrangement for
19 delivery of care. This survey shall:
20 (1) be administered annually by the Director, or by
21 an independent agency or organization selected by the
22 Director;
23 (2) be administered to a scientifically selected
24 representative sample of current enrollees from each
25 plan, as well as persons who have disenrolled from a plan
26 in the last calendar year; and
27 (3) emphasize the collection of information from
28 persons who have used the managed care plan to a
29 significant degree, as defined by rule.
30 Selected data from the annual survey shall be made
31 available to current and prospective enrollees as part of a
32 consumer guidebook or managed care report card of health plan
33 performance, which the Department shall develop and publish.
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1 The elements to be included in the guidebook shall be
2 reassessed on an ongoing basis by the Department. The
3 consumer guidebook shall be updated at least annually.
4 Section 95. Managed care patient rights. In addition to
5 all other requirements of this Act, a managed care plan shall
6 ensure that an enrollee has the following rights:
7 (1) A patient has the right to care consistent with
8 professional standards of practice to assure quality nursing
9 and medical practices, to choose the participating physician
10 responsible for coordinating his or her care, to receive
11 information concerning his or her condition and proposed
12 treatment, to refuse any treatment to the extent permitted by
13 law, and to privacy and confidentiality of records except as
14 otherwise provided by law.
15 (2) A patient has the right, regardless of source of
16 payment, to examine and to receive a reasonable explanation
17 of his or her total bill for health care services rendered by
18 his or her physician or other health care provider, including
19 the itemized charges for specific health care services
20 received. A physician or other health care provider shall be
21 responsible only for a reasonable explanation of these
22 specific health care services provided by the health care
23 provider.
24 (3) A patient has the right to privacy and
25 confidentiality in health care. This right may be expressly
26 waived in writing by the patient or the patient's guardian.
27 Section 100. Health care entity liability.
28 (a) In this Section:
29 "Appropriate and medically necessary" means the standard
30 for health care services as determined by physicians and
31 health care providers in accordance with the prevailing
32 practices and standards of the medical profession and
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1 community.
2 "Enrollee" means an individual who is enrolled in a
3 health care plan, including covered dependents.
4 "Health care plan" means any plan whereby any person
5 undertakes to provide, arrange for, pay for, or reimburse any
6 part of the cost of any health care services.
7 "Health care provider" means a person or entity as
8 defined in Section 2-1003 of the Code of Civil Procedure.
9 "Health care treatment decision" means a determination
10 made when medical services are actually provided by the
11 health care plan and a decision that affects the quality of
12 the diagnosis, care, or treatment provided to the plan's
13 insureds or enrollees.
14 "Health insurance carrier" means an authorized insurance
15 company that issues policies of accident and health insurance
16 under the Illinois Insurance Code.
17 "Health maintenance organization" means an organization
18 licensed under the Health Maintenance Organization Act.
19 "Managed care entity" means any entity that delivers,
20 administers, or assumes risk for health care services with
21 systems or techniques to control or influence the quality,
22 accessibility, utilization, or costs and prices of those
23 services to a defined enrollee population, but does not
24 include an employer purchasing coverage or acting on behalf
25 of its employees or the employees of one or more subsidiaries
26 or affiliated corporations of the employer.
27 "Physician" means: (1) an individual licensed to practice
28 medicine in this State; (2) a professional association,
29 professional service corporation, partnership, medical
30 corporation, or limited liability company, entitled to
31 lawfully engage in the practice of medicine; or (3) another
32 person wholly owned by physicians.
33 "Ordinary care" means, in the case of a health insurance
34 carrier, health maintenance organization, or managed care
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1 entity, that degree of care that a health insurance carrier,
2 health maintenance organization, or managed care entity of
3 ordinary prudence would use under the same or similar
4 circumstances. In the case of a person who is an employee,
5 agent, ostensible agent, or representative of a health
6 insurance carrier, health maintenance organization, or
7 managed care entity, "ordinary care" means that degree of
8 care that a person of ordinary prudence in the same
9 profession, specialty, or area of practice as such person
10 would use in the same or similar circumstances.
11 (b) A health insurance carrier, health maintenance
12 organization, or other managed care entity for a health care
13 plan has the duty to exercise ordinary care when making
14 health care treatment decisions and is liable for damages for
15 harm to an insured or enrollee proximately caused by its
16 failure to exercise such ordinary care.
17 (c) A health insurance carrier, health maintenance
18 organization, or other managed care entity for a health care
19 plan is also liable for damages for harm to an insured or
20 enrollee proximately caused by the health care treatment
21 decisions made by its:
22 (1) employees;
23 (2) agents;
24 (3) ostensible agents; or
25 (4) representatives who are acting on its behalf
26 and over whom it has the right to exercise influence or
27 control or has actually exercised influence or control
28 that results in the failure to exercise ordinary care.
29 (d) The standards in subsections (b) and (c) create no
30 obligation on the part of the health insurance carrier,
31 health maintenance organization, or other managed care entity
32 to provide to an insured or enrollee treatment that is not
33 covered by the health care plan of the entity.
34 (e) A health insurance carrier, health maintenance
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1 organization, or managed care entity may not remove a
2 physician or health care provider from its plan or refuse to
3 renew the physician or health care provider with its plan for
4 advocating on behalf of an enrollee for appropriate and
5 medically necessary health care for the enrollee.
6 (f) A health insurance carrier, health maintenance
7 organization, or other managed care entity may not enter into
8 a contract with a physician, hospital, or other health care
9 provider or pharmaceutical company which includes an
10 indemnification or hold harmless clause for the acts or
11 conduct of the health insurance carrier, health maintenance
12 organization, or other managed care entity. Any such
13 indemnification or hold harmless clause in an existing
14 contract is hereby declared void.
15 (g) Nothing in any law of this State prohibiting a
16 health insurance carrier, health maintenance organization, or
17 other managed care entity from practicing medicine or being
18 licensed to practice medicine may be asserted as a defense by
19 the health insurance carrier, health maintenance
20 organization, or other managed care entity in an action
21 brought against it pursuant to this Section or any other law.
22 (h) In an action against a health insurance carrier,
23 health maintenance organization, or managed care entity, a
24 finding that a physician or other health care provider is an
25 employee, agent, ostensible agent, or representative of the
26 health insurance carrier, health maintenance organization, or
27 managed care entity shall not be based solely on proof that
28 the person's name appears in a listing of approved physicians
29 or health care providers made available to insureds or
30 enrollees under a health care plan.
31 (i) This Section does not apply to workers' compensation
32 insurance coverage subject to the Workers' Compensation Act.
33 (j) This Section does not apply to actions seeking only
34 a review of an adverse utilization review determination.
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1 This Section applies only to causes of action that accrue on
2 or after the effective date of this Act. An insured or
3 enrollee seeking damages under this Section has the right and
4 duty to submit the claim to arbitration in accordance with
5 the Uniform Arbitration Act. No agreement between the
6 parties to submit the claim to arbitration is necessary. A
7 health insurance carrier, health maintenance organization, or
8 managed care entity shall have no liability under this
9 Section unless the claim is first submitted to arbitration in
10 accordance with the Uniform Arbitration Act. The award in
11 matters arbitrated pursuant to this Section shall be made
12 within 30 days after notification of the arbitration is
13 provided to all parties.
14 (k) The determination of whether a procedure or
15 treatment is medically necessary must be made by a physician.
16 (l) If the physician determines that a procedure or
17 treatment is medically necessary, the health care plan must
18 pay for the procedure or treatment.
19 (m) This Section does not apply to licensed insurance
20 agents.
21 Section 105. Waiver. Any agreement that purports to
22 waive, limit, disclaim or in any way diminish the rights set
23 forth in this Act is void as contrary to public policy.
24 Section 110. Administration of Act.
25 (a) The Department shall administer this Act.
26 (b) All managed care plans and utilization review
27 programs providing or reviewing services in Illinois shall
28 annually certify compliance with this Act and rules adopted
29 under this Act to the Department in addition to any other
30 licensure required by law. The Director shall establish by
31 rule a process for this certification including fees to cover
32 the costs associated with implementing this Act. All fees
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1 and fines assessed under this Act shall be deposited in the
2 Managed Care Reform Fund, a special fund hereby created in
3 the State treasury. Moneys in the Fund shall be used by the
4 Department only to enforce and administer this Act. The
5 certification requirements of this Act shall be incorporated
6 into program requirements of the Department of Public Aid and
7 Department of Human Services and no further certification
8 under this Act is required.
9 (c) The Director shall take enforcement action under
10 this Act including, but not limited to, the assessment of
11 civil fines and injunctive relief for any failure to comply
12 with this Act or any violation of the Act or rules by a
13 managed care plan or any utilization review program.
14 (d) The Department shall have the authority to impose
15 fines on any managed care plan or any utilization review
16 program. The Department shall adopt rules pursuant to this
17 Act that establish a system of fines related to the type and
18 level of violation or repeat violation, including but not
19 limited to:
20 (1) A fine not exceeding $10,000 for a violation
21 that created a condition or occurrence presenting a
22 substantial probability that death or serious harm to an
23 individual will or did result therefrom; and
24 (2) A fine not exceeding $5,000 for a violation
25 that creates or created a condition or occurrence that
26 threatens the health, safety, or welfare of an
27 individual.
28 Each day a violation continues shall constitute a
29 separate offense. These rules shall include an opportunity
30 for a hearing in accordance with the Illinois Administrative
31 Procedure Act. All final decisions of the Department shall
32 be reviewable under the Administrative Review Law.
33 (e) Notwithstanding the existence or pursuit of any
34 other remedy, the Director may, through the Attorney General,
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1 seek an injunction to restrain or prevent any person or
2 entity from functioning or operating in violation of this Act
3 or rule.
4 Section 115. Emergency services prior to stabilization.
5 (a) A managed care plan subject to this Act that
6 provides or that is required by law to provide coverage for
7 emergency services shall provide coverage such that payment
8 under this coverage is not dependent upon whether the
9 services are performed by a plan or non-plan physician or
10 health care provider and without regard to prior
11 authorization. This coverage shall be at the same benefit
12 level as if the services or treatment had been rendered by
13 the managed care plan physician or health care provider.
14 (b) Prior authorization or approval by the plan shall
15 not be required for emergency services.
16 (c) Coverage and payment shall not be retrospectively
17 denied, with the following exceptions:
18 (1) upon reasonable determination that the
19 emergency services claimed were never performed;
20 (2) upon reasonable determination that the
21 emergency evaluation and treatment were rendered to an
22 enrollee who sought emergency services and whose
23 circumstance did not meet the definition of emergency
24 medical condition;
25 (3) upon determination that the patient receiving
26 such services was not an enrollee of the health insurance
27 plan; or
28 (4) upon material misrepresentation by the enrollee
29 or health care provider; "material" means a fact or
30 situation that is not merely technical in nature and
31 results or could result in a substantial change in the
32 situation.
33 (d) When an enrollee presents to a hospital seeking
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1 emergency services, the determination as to whether the need
2 for those services exists shall be made for purposes of
3 treatment by a physician licensed to practice medicine in all
4 its branches or, to the extent permitted by applicable law,
5 by other appropriately licensed personnel under the
6 supervision of or in collaboration with a physician licensed
7 to practice medicine in all its branches. The physician or
8 other appropriate personnel shall indicate in the patient's
9 chart the results of the emergency medical screening
10 examination. The managed care plan shall compensate the
11 health care professional or provider for the emergency
12 medical screening examination.
13 (e) The appropriate use of the 911 emergency telephone
14 system or its local equivalent shall not be discouraged or
15 penalized by the health insurance plan when an emergency
16 medical condition exists. This provision shall not imply that
17 the use of 911 or its local equivalent is a factor in
18 determining the existence of an emergency medical condition.
19 (f) Nothing in this Section alters the prohibition on
20 billing enrollees contained in the Health Maintenance
21 Organization Act. Nothing in this Section shall prohibit the
22 imposition of deductibles, co-payments, and co-insurance.
23 Section 120. Post-stabilization medical services.
24 (a) If prior authorization for covered post-stabilization
25 services is required by the managed care plan, the plan shall
26 provide access 24 hours a day, 7 days a week to persons
27 designated by the plan to make such determinations.
28 (b) The treating physician or health care provider shall
29 contact the managed care plan or delegated physician or
30 health care provider as designated on the enrollee's health
31 insurance card to obtain authorization, denial, or
32 arrangements for an alternate plan of treatment or transfer
33 of the enrollee.
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1 (c) The treating physician licensed to practice medicine
2 in all its branches or health care provider shall document in
3 the enrollee's medical record the enrollee's presenting
4 symptoms; emergency medical condition; and time, phone number
5 dialed, and result of the communication for request for
6 authorization of post stabilization medical services. The
7 managed care plan shall provide reimbursement for covered
8 post-stabilization medical services if:
9 (1) authorization to render them is received from
10 the managed care plan or its delegated physician or
11 health care provider; or
12 (2) after 2 documented good faith efforts, the
13 treating physician or health care provider has attempted
14 to contact the enrollee's managed care plan or its
15 delegated physician or health care provider, as
16 designated on the enrollee's health insurance card, for
17 prior authorization of post-stabilization medical
18 services and neither the plan nor designated persons were
19 accessible or the authorization was not denied within 60
20 minutes of the request. "Two documented good faith
21 efforts" means the physician or health care provider has
22 called the telephone number on the enrollee's health
23 insurance card or other available number either 2 times
24 or one time and made an additional call to any referral
25 number provided. "Good faith" means honesty of purpose,
26 freedom from intention to defraud, and being faithful to
27 one's duty or obligation. For the purpose of this Act,
28 good faith shall be presumed.
29 (d) After rendering any post-stabilization medical
30 services, the treating physician or health care provider
31 shall continue to make every reasonable effort to contact the
32 managed care plan or its delegated physician or health care
33 provider regarding authorization, denial, or arrangements for
34 an alternate plan of treatment or transfer of the enrollee
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1 until the treating physician or health care provider receives
2 instructions from the managed care plan or delegated
3 physician or health care provider for continued care or the
4 care is transferred to another physician or health care
5 provider or the patient is discharged.
6 (e) Payment for covered post-stabilization services may
7 be denied:
8 (1) if the treating physician or health care
9 provider does not meet the conditions outlined in
10 subsection (c);
11 (2) upon determination that the post-stabilization
12 services claimed were not performed;
13 (3) upon determination that the post-stabilization
14 services rendered were contrary to the instructions of
15 the managed care plan or its delegated physician or
16 health care provider if contact was made between those
17 parties prior to the service being rendered;
18 (4) upon determination that the patient receiving
19 such services was not an enrollee of the managed care
20 plan; or
21 (5) upon material misrepresentation by the enrollee
22 or health care provider; "material" means a fact or
23 situation that is not merely technical in nature and
24 results or could result in a substantial change in the
25 situation.
26 (f) Coverage and payment for post-stabilization medical
27 services for which prior authorization or deemed approval is
28 received shall not be retrospectively denied.
29 (g) Nothing in this Section prohibits a managed care
30 plan from delegating tasks associated with the
31 responsibilities enumerated in this Section to the managed
32 care plan's contracted health care providers or another
33 entity. However, the ultimate responsibility for coverage
34 and payment decisions may not be delegated.
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1 (h) Nothing in this Section shall prohibit the
2 imposition of deductibles, co-payments, and co-insurance.
3 Section 125. Prescription drugs. A managed care plan
4 that provides coverage for prescribed drugs approved by the
5 federal Food and Drug Administration shall not exclude
6 coverage of any drug on the basis that the drug has been
7 prescribed for the treatment of a particular indication for
8 which the drug has not been approved by the federal Food and
9 Drug Administration. The drug, however, must be approved by
10 the federal Food and Drug Administration and must be
11 recognized for the treatment of that particular indication
12 for which the drug has been prescribed in any one of the
13 following established reference compendia:
14 (1) the American Hospital Formulary Service Drug
15 Information;
16 (2) the United States Pharmacopoeia Drug
17 Information; or
18 (3) if not recognized by the authorities in item
19 (1) or (2), recommended for that particular indication in
20 formal clinical studies, the results of which have been
21 published in at least 2 peer reviewed professional
22 medical journals published in the United States or Great
23 Britain.
24 Any coverage required by this Section shall also include
25 those medically necessary services associated with the
26 administration of a drug.
27 Despite the provisions of this Section, coverage shall
28 not be required for any experimental or investigational drugs
29 or any drug that the federal Food and Drug Administration has
30 determined to be contraindicated for treatment of the
31 specific indication for which the drug has been prescribed.
32 Nothing in this Section shall be construed, expressly or by
33 implication, to create, impair, alter, limit, notify,
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1 enlarge, abrogate, or prohibit reimbursement for drugs used
2 in the treatment of any other disease or condition.
3 Section 130. Applicability and scope. This Act applies
4 to policies and contracts amended, delivered, issued, or
5 renewed on or after the effective date of this Act. This Act
6 does not diminish a managed care plan's duties and
7 responsibilities under other federal or State law or rules
8 promulgated thereunder.
9 Section 135. Effect on benefits under Workers'
10 Compensation Act and Workers' Occupational Diseases Act.
11 Nothing in this Act shall be construed to expand, modify, or
12 restrict the health care benefits provided to employees under
13 the Workers' Compensation Act and Workers' Occupational
14 Diseases Act.
15 Section 140. Conflicts with federal law. When health
16 care services are provided by a managed care plan subject to
17 this Act to a person who is a recipient of medical assistance
18 under Article V of the Illinois Public Aid Code, the rights,
19 benefits, requirements, and procedures available or
20 authorized under this Act shall not apply to the extent that
21 there are provisions of federal law that conflict. In the
22 event of a conflict, federal law shall prevail.
23 Section 145. Severability. The provisions of this Act
24 are severable under Section 1.31 of the Statute on Statutes.
25 Section 150. The State Employees Group Insurance Act of
26 1971 is amended by adding Section 6.12 as follows:
27 (5 ILCS 375/6.12 new)
28 Sec. 6.12. Managed Care Reform Act. The program of
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1 health benefits is subject to the provisions of the Managed
2 Care Reform Act.
3 Section 155. The Civil Administrative Code of Illinois
4 is amended by adding Sections 56.3 and 56.4 as follows:
5 (20 ILCS 1405/56.3 new)
6 Sec. 56.3. Office of Consumer Health Insurance.
7 (a) The Director of Insurance shall establish the Office
8 of Consumer Health Insurance within the Department of
9 Insurance to provide assistance, advocacy, and information to
10 all health care consumers within the State. The staff
11 responsible shall have direct line reporting responsibility
12 to the Director. Within the appropriation allocated, the
13 office shall provide information and assistance to all health
14 care consumers by:
15 (1) assisting consumers in understanding health
16 insurance marketing materials and the coverage provisions
17 of individual plans including, but not limited to,
18 advocacy for consumers before plans and governmental and
19 nongovernmental agencies;
20 (2) educating enrollees about their rights within
21 individual plans;
22 (3) assisting enrollees in filing formal grievances
23 and appeals;
24 (4) investigating enrollee complaints;
25 (5) establishing and operating an 800 telephone
26 line to handle consumer inquiries;
27 (6) making information available in languages other
28 than English that are spoken as a primary language by a
29 significant portion of the State's population, as
30 determined by the Department;
31 (7) analyzing, commenting on, monitoring, and
32 making publicly available reports on the development and
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1 implementation of federal, State and local laws,
2 regulations, and other governmental policies and actions
3 that pertain to the adequacy of managed care plans,
4 facilities, and services in the State;
5 (8) filing an annual report with the Director and
6 the General Assembly, which shall include recommendations
7 for improvement to the regulation of health insurance
8 plans; and
9 (9) performing all duties assigned to the Office by
10 the Director.
11 (b) Beginning March 1, 2000, the Office shall report, on
12 at least a quarterly basis, any patterns identified from the
13 consumer complaints addressed by the Office to the Director
14 and the Governor. By January 1, 2001, and each January 1
15 thereafter, the Director shall make an annual written report
16 to the General Assembly regarding activities of the Office,
17 including recommendations on improving health care consumer
18 assistance and complaint resolution processes.
19 (c) Nothing in this Section shall be interpreted to
20 authorize access to or disclosure of individual patient or
21 health professional or provider records.
22 (20 ILCS 1405/56.4 new)
23 Sec. 56.4. Retaliation. A managed care plan or health
24 care provider may not retaliate or take adverse action
25 against an enrollee or patient who, in good faith, makes a
26 complaint against a managed care plan, health plan company,
27 or health care provider.
28 Section 160. The State Finance Act is amended by adding
29 Section 5.490 as follows:
30 (30 ILCS 105/5.490 new)
31 Sec. 5.490. The Managed Care Reform Fund.
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1 Section 165. The State Mandates Act is amended by adding
2 Section 8.23 as follows:
3 (30 ILCS 805/8.23 new)
4 Sec. 8.23. Exempt mandate. Notwithstanding Sections 6
5 and 8 of this Act, no reimbursement by the State is required
6 for the implementation of any mandate created by this
7 amendatory Act of 1999.
8 Section 170. The Counties Code is amended by adding
9 Section 5-1069.8 as follows:
10 (55 ILCS 5/5-1069.8 new)
11 Sec. 5-1069.8. Managed Care Reform Act. All counties,
12 including home rule counties, are subject to the provisions
13 of the Managed Care Reform Act. The requirement under this
14 Section that health care benefits provided by counties comply
15 with the Managed Care Reform Act is an exclusive power and
16 function of the State and is a denial and limitation of home
17 rule county powers under Article VII, Section 6, subsection
18 (h) of the Illinois Constitution.
19 Section 175. The Illinois Municipal Code is amended by
20 adding Section 10-4-2.8 as follows:
21 (65 ILCS 5/10-4-2.8 new)
22 Sec. 10-4-2.8. Managed Care Reform Act. The corporate
23 authorities of all municipalities are subject to the
24 provisions of the Managed Care Reform Act. The requirement
25 under this Section that health care benefits provided by
26 municipalities comply with the Managed Care Reform Act is an
27 exclusive power and function of the State and is a denial and
28 limitation of home rule municipality powers under Article
29 VII, Section 6, subsection (h) of the Illinois Constitution.
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1 Section 180. The School Code is amended by adding
2 Section 10-22.3g as follows:
3 (105 ILCS 5/10-22.3g new)
4 Sec. 10-22.3g. Managed Care Reform Act. Insurance
5 protection and benefits for employees are subject to the
6 Managed Care Reform Act.
7 Section 185. The Illinois Insurance Code is amended by
8 changing Section 370g and adding Sections 155.36, 370s, and
9 511.118 as follows:
10 (215 ILCS 5/155.36 new)
11 Sec. 155.36. Managed Care Reform Act. Insurance
12 companies that transact the kinds of insurance authorized
13 under Class 1(b) or Class 2(a) of Section 4 of this Code
14 shall comply with Sections 25 and 75 and the definition of
15 the term "emergency medical condition" in Section 5 of the
16 Managed Care Reform Act.
17 (215 ILCS 5/370g) (from Ch. 73, par. 982g)
18 Sec. 370g. Definitions. As used in this Article, the
19 following definitions apply:
20 (a) "Health care services" means health care services or
21 products rendered or sold by a provider within the scope of
22 the provider's license or legal authorization. The term
23 includes, but is not limited to, hospital, medical, surgical,
24 dental, vision and pharmaceutical services or products.
25 (b) "Insurer" means an insurance company or a health
26 service corporation authorized in this State to issue
27 policies or subscriber contracts which reimburse for expenses
28 of health care services.
29 (c) "Insured" means an individual entitled to
30 reimbursement for expenses of health care services under a
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1 policy or subscriber contract issued or administered by an
2 insurer.
3 (d) "Provider" means an individual or entity duly
4 licensed or legally authorized to provide health care
5 services.
6 (e) "Noninstitutional provider" means any person
7 licensed under the Medical Practice Act of 1987, as now or
8 hereafter amended.
9 (f) "Beneficiary" means an individual entitled to
10 reimbursement for expenses of or the discount of provider
11 fees for health care services under a program where the
12 beneficiary has an incentive to utilize the services of a
13 provider which has entered into an agreement or arrangement
14 with an administrator.
15 (g) "Administrator" means any person, partnership or
16 corporation, other than an insurer or health maintenance
17 organization holding a certificate of authority under the
18 "Health Maintenance Organization Act", as now or hereafter
19 amended, that arranges, contracts with, or administers
20 contracts with a provider whereby beneficiaries are provided
21 an incentive to use the services of such provider.
22 (h) "Emergency medical condition" means a medical
23 condition manifesting itself by acute symptoms of sufficient
24 severity (including but not limited to severe pain) such that
25 a prudent layperson, who possesses an average knowledge of
26 health and medicine, could reasonably expect the absence of
27 immediate medical attention to result in:
28 (1) placing the health of the individual (or, with
29 respect to a pregnant woman, the health of the woman or
30 her unborn child) in serious jeopardy;
31 (2) serious impairment to bodily functions; or
32 (3) serious dysfunction of any bodily organ or
33 part. "Emergency" means an accidental bodily injury or
34 emergency medical condition which reasonably requires the
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1 beneficiary or insured to seek immediate medical care
2 under circumstances or at locations which reasonably
3 preclude the beneficiary or insured from obtaining needed
4 medical care from a preferred provider.
5 (Source: P.A. 88-400.)
6 (215 ILCS 5/370s new)
7 Sec. 370s. Managed Care Reform Act. All administrators
8 shall comply with Sections 25 and 75 of the Managed Care
9 Reform Act.
10 (215 ILCS 5/511.118 new)
11 Sec. 511.118. Managed Care Reform Act. All
12 administrators are subject to the provisions of Sections 25
13 and 75 of the Managed Care Reform Act.
14 Section 190. The Comprehensive Health Insurance Plan Act
15 is amended by adding Section 8.6 as follows:
16 (215 ILCS 105/8.6 new)
17 Sec. 8.6. Managed Care Reform Act. The plan is subject
18 to the provisions of the Managed Care Reform Act.
19 Section 195. The Health Care Purchasing Group Act is
20 amended by changing Sections 15 and 20 as follows:
21 (215 ILCS 123/15)
22 Sec. 15. Health care purchasing groups; membership;
23 formation.
24 (a) An HPG may be an organization formed by 2 or more
25 employers with no more than 500 covered employees each 2,500
26 covered individuals, an HPG sponsor or a risk-bearer for
27 purposes of contracting for health insurance under this Act
28 to cover employees and dependents of HPG members. An HPG
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1 shall not be prevented from supplementing health insurance
2 coverage purchased under this Act by contracting for services
3 from entities licensed and authorized in Illinois to provide
4 those services under the Dental Service Plan Act, the Limited
5 Health Service Organization Act, or Voluntary Health Services
6 Plans Act. An HPG may be a separate legal entity or simply a
7 group of 2 or more employers with no more than 500 covered
8 employees each 2,500 covered individuals aggregated under
9 this Act by an HPG sponsor or risk-bearer for insurance
10 purposes. There shall be no limit as to the number of HPGs
11 that may operate in any geographic area of the State. No
12 insurance risk may be borne or retained by the HPG. All
13 health insurance contracts issued to the HPG must be
14 delivered or issued for delivery in Illinois.
15 (b) Members of an HPG must be Illinois domiciled
16 employers, except that an employer domiciled elsewhere may
17 become a member of an Illinois HPG for the sole purpose of
18 insuring its employees whose place of employment is located
19 within this State. HPG membership may include employers
20 having no more than 500 covered employees each 2,500 covered
21 individuals.
22 (c) If an HPG is formed by any 2 or more employers with
23 no more than 500 covered employees each 2,500 covered
24 individuals, it is authorized to negotiate, solicit, market,
25 obtain proposals for, and enter into group or master health
26 insurance contracts on behalf of its members and their
27 employees and employee dependents so long as it meets all of
28 the following requirements:
29 (1) The HPG must be an organization having the
30 legal capacity to contract and having its legal situs in
31 Illinois.
32 (2) The principal persons responsible for the
33 conduct of the HPG must perform their HPG related
34 functions in Illinois.
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1 (3) No HPG may collect premium in its name or hold
2 or manage premium or claim fund accounts unless duly
3 licensed and qualified as a managing general agent
4 pursuant to Section 141a of the Illinois Insurance Code
5 or a third party administrator pursuant to Section
6 511.105 of the Illinois Insurance Code.
7 (4) If the HPG gives an offer, application, notice,
8 or proposal of insurance to an employer, it must disclose
9 to that employer the total cost of the insurance. Dues,
10 fees, or charges to be paid to the HPG, HPG sponsor, or
11 any other entity as a condition to purchasing the
12 insurance must be itemized. The HPG shall also disclose
13 to its members the amount of any dividends, experience
14 refunds, or other such payments it receives from the
15 risk-bearer.
16 (5) An HPG must register with the Director before
17 entering into a group or master health insurance contract
18 on behalf of its members and must renew the registration
19 annually on forms and at times prescribed by the Director
20 in rules specifying, at minimum, (i) the identity of the
21 officers and directors, trustees, or attorney-in-fact of
22 the HPG; (ii) a certification that those persons have not
23 been convicted of any felony offense involving a breach
24 of fiduciary duty or improper manipulation of accounts;
25 and (iii) the number of employer members then enrolled in
26 the HPG, together with any other information that may be
27 needed to carry out the purposes of this Act.
28 (6) At the time of initial registration and each
29 renewal thereof an HPG shall pay a fee of $100 to the
30 Director.
31 (d) If an HPG is formed by an HPG sponsor or risk-bearer
32 and the HPG performs no marketing, negotiation, solicitation,
33 or proposing of insurance to HPG members, exclusive of
34 ministerial acts performed by individual employers to service
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1 their own employees, then a group or master health insurance
2 contract may be issued in the name of the HPG and held by an
3 HPG sponsor, risk-bearer, or designated employer member
4 within the State. In these cases the HPG requirements
5 specified in subsection (c) shall not be applicable, however:
6 (1) the group or master health insurance contract
7 must contain a provision permitting the contract to be
8 enforced through legal action initiated by any employer
9 member or by an employee of an HPG member who has paid
10 premium for the coverage provided;
11 (2) the group or master health insurance contract
12 must be available for inspection and copying by any HPG
13 member, employee, or insured dependent at a designated
14 location within the State at all normal business hours;
15 and
16 (3) any information concerning HPG membership
17 required by rule under item (5) of subsection (c) must be
18 provided by the HPG sponsor in its registration and
19 renewal forms or by the risk-bearer in its annual
20 reports.
21 (Source: P.A. 90-337, eff. 1-1-98; 90-655, eff. 7-30-98.)
22 (215 ILCS 123/20)
23 Sec. 20. HPG sponsors. Except as provided by Sections 15
24 and 25 of this Act, only a corporation authorized by the
25 Secretary of State to transact business in Illinois may
26 sponsor one or more HPGs with no more than 100,000 10,000
27 covered individuals by negotiating, soliciting, or servicing
28 health insurance contracts for HPGs and their members. Such a
29 corporation may assert and maintain authority to act as an
30 HPG sponsor by complying with all of the following
31 requirements:
32 (1) The principal officers and directors
33 responsible for the conduct of the HPG sponsor must
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1 perform their HPG sponsor related functions in Illinois.
2 (2) No insurance risk may be borne or retained by
3 the HPG sponsor; all health insurance contracts issued to
4 HPGs through the HPG sponsor must be delivered in
5 Illinois.
6 (3) No HPG sponsor may collect premium in its name
7 or hold or manage premium or claim fund accounts unless
8 duly qualified and licensed as a managing general agent
9 pursuant to Section 141a of the Illinois Insurance Code
10 or as a third party administrator pursuant to Section
11 511.105 of the Illinois Insurance Code.
12 (4) If the HPG gives an offer, application, notice,
13 or proposal of insurance to an employer, it must disclose
14 the total cost of the insurance. Dues, fees, or charges
15 to be paid to the HPG, HPG sponsor, or any other entity
16 as a condition to purchasing the insurance must be
17 itemized. The HPG shall also disclose to its members the
18 amount of any dividends, experience refunds, or other
19 such payments it receives from the risk-bearer.
20 (5) An HPG sponsor must register with the Director
21 before negotiating or soliciting any group or master
22 health insurance contract for any HPG and must renew the
23 registration annually on forms and at times prescribed by
24 the Director in rules specifying, at minimum, (i) the
25 identity of the officers and directors of the HPG sponsor
26 corporation; (ii) a certification that those persons have
27 not been convicted of any felony offense involving a
28 breach of fiduciary duty or improper manipulation of
29 accounts; (iii) the number of employer members then
30 enrolled in each HPG sponsored; (iv) the date on which
31 each HPG was issued a group or master health insurance
32 contract, if any; and (v) the date on which each such
33 contract, if any, was terminated.
34 (6) At the time of initial registration and each
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1 renewal thereof an HPG sponsor shall pay a fee of $100 to
2 the Director.
3 (Source: P.A. 90-337, eff. 1-1-98.)
4 Section 200. The Health Maintenance Organization Act is
5 amended by changing Sections 2-2 and 6-7 and adding Section
6 5-3.6 as follows:
7 (215 ILCS 125/2-2) (from Ch. 111 1/2, par. 1404)
8 Sec. 2-2. Determination by Director; Health Maintenance
9 Advisory Board.
10 (a) Upon receipt of an application for issuance of a
11 certificate of authority, the Director shall transmit copies
12 of such application and accompanying documents to the
13 Director of the Illinois Department of Public Health. The
14 Director of the Department of Public Health shall then
15 determine whether the applicant for certificate of authority,
16 with respect to health care services to be furnished: (1) has
17 demonstrated the willingness and potential ability to assure
18 that such health care service will be provided in a manner to
19 insure both availability and accessibility of adequate
20 personnel and facilities and in a manner enhancing
21 availability, accessibility, and continuity of service; and
22 (2) has arrangements, established in accordance with rules
23 regulations promulgated by the Department of Public Health
24 for an ongoing quality of health care assurance program
25 concerning health care processes and outcomes. Upon
26 investigation, the Director of the Department of Public
27 Health shall certify to the Director whether the proposed
28 Health Maintenance Organization meets the requirements of
29 this subsection (a). If the Director of the Department of
30 Public Health certifies that the Health Maintenance
31 Organization does not meet such requirements, he or she shall
32 specify in what respect it is deficient.
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1 There is created in the Department of Public Health a
2 Health Maintenance Advisory Board composed of 11 members.
3 Nine of the 11 9 members shall who have practiced in the
4 health field and, 4 of those 9 which shall have been or shall
5 be are currently affiliated with a Health Maintenance
6 Organization. Two of the members shall be members of the
7 general public, one of whom is over 65 years of age. Each
8 member shall be appointed by the Director of the Department
9 of Public Health and serve at the pleasure of that Director
10 and shall receive no compensation for services rendered other
11 than reimbursement for expenses. Six Five members of the
12 Board shall constitute a quorum. A vacancy in the membership
13 of the Advisory Board shall not impair the right of a quorum
14 to exercise all rights and perform all duties of the Board.
15 The Health Maintenance Advisory Board has the power to review
16 and comment on proposed rules and regulations to be
17 promulgated by the Director of the Department of Public
18 Health within 30 days after those proposed rules and
19 regulations have been submitted to the Advisory Board.
20 (b) Issuance of a certificate of authority shall be
21 granted if the following conditions are met:
22 (1) the requirements of subsection (c) of Section
23 2-1 have been fulfilled;
24 (2) the persons responsible for the conduct of the
25 affairs of the applicant are competent, trustworthy, and
26 possess good reputations, and have had appropriate
27 experience, training or education;
28 (3) the Director of the Department of Public Health
29 certifies that the Health Maintenance Organization's
30 proposed plan of operation meets the requirements of this
31 Act;
32 (4) the Health Care Plan furnishes basic health
33 care services on a prepaid basis, through insurance or
34 otherwise, except to the extent of reasonable
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1 requirements for co-payments or deductibles as authorized
2 by this Act;
3 (5) the Health Maintenance Organization is
4 financially responsible and may reasonably be expected to
5 meet its obligations to enrollees and prospective
6 enrollees; in making this determination, the Director
7 shall consider:
8 (A) the financial soundness of the applicant's
9 arrangements for health services and the minimum
10 standard rates, co-payments and other patient
11 charges used in connection therewith;
12 (B) the adequacy of working capital, other
13 sources of funding, and provisions for
14 contingencies; and
15 (C) that no certificate of authority shall be
16 issued if the initial minimum net worth of the
17 applicant is less than $2,000,000. The initial net
18 worth shall be provided in cash and securities in
19 combination and form acceptable to the Director;
20 (6) the agreements with providers for the provision
21 of health services contain the provisions required by
22 Section 2-8 of this Act; and
23 (7) any deficiencies identified by the Director
24 have been corrected.
25 (Source: P.A. 86-620; 86-1475.)
26 (215 ILCS 125/5-3.6 new)
27 Sec. 5-3.6. Managed Care Reform Act. Health
28 maintenance organizations are subject to the provisions of
29 the Managed Care Reform Act.
30 (215 ILCS 125/6-7) (from Ch. 111 1/2, par. 1418.7)
31 Sec. 6-7. Board of Directors. The board of directors of
32 the Association shall consist consists of not less than 7 5
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1 nor more than 11 9 members serving terms as established in
2 the plan of operation. The members of the board are to be
3 selected by member organizations subject to the approval of
4 the Director provided, however, that 2 members shall be
5 enrollees, one of whom is over 65 years of age. Vacancies on
6 the board must be filled for the remaining period of the term
7 in the manner described in the plan of operation. To select
8 the initial board of directors, and initially organize the
9 Association, the Director must give notice to all member
10 organizations of the time and place of the organizational
11 meeting. In determining voting rights at the organizational
12 meeting each member organization is entitled to one vote in
13 person or by proxy. If the board of directors is not
14 selected at the organizational meeting, the Director may
15 appoint the initial members.
16 In approving selections or in appointing members to the
17 board, the Director must consider, whether all member
18 organizations are fairly represented.
19 Members of the board may be reimbursed from the assets of
20 the Association for expenses incurred by them as members of
21 the board of directors but members of the board may not
22 otherwise be compensated by the Association for their
23 services.
24 (Source: P.A. 85-20.)
25 Section 205. The Limited Health Service Organization Act
26 is amended by adding Section 4002.6 as follows:
27 (215 ILCS 130/4002.6 new)
28 Sec. 4002.6. Managed Care Reform Act. Except for health
29 care plans offering only dental services or only vision
30 services, limited health service organizations are subject to
31 the provisions of the Managed Care Reform Act.
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1 Section 210. The Voluntary Health Services Plans Act is
2 amended by adding Section 15.30 as follows:
3 (215 ILCS 165/15.30 new)
4 Sec. 15.30. Managed Care Reform Act. A health service
5 plan corporation is subject to the provisions of the Managed
6 Care Reform Act.
7 Section 215. The Illinois Public Aid Code is amended by
8 adding Section 5-16.12 as follows:
9 (305 ILCS 5/5-16.12 new)
10 Sec. 5-16.12. Managed Care Reform Act. The medical
11 assistance program and other programs administered by the
12 Department are subject to the provisions of the Managed Care
13 Reform Act. The Department may adopt rules to implement those
14 provisions. These rules shall require compliance with that
15 Act in the medical assistance managed care programs and other
16 programs administered by the Department. The medical
17 assistance fee-for-service program is not subject to the
18 provisions of the Managed Care Reform Act.
19 Section 250. Effective date. This Act takes effect
20 January 1, 2000.
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