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91_HB0733enr
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1 AN ACT in relation to health care.
2 Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
4 Section 1. Short title. This Act may be cited as the
5 Hospital Cooperation Act.
6 Section 5. Legislative findings. The General Assembly
7 finds that the goals of controlling health care costs and
8 improving the quality of and access to open-heart surgery in
9 Health Service Area V may be significantly enhanced by a
10 cooperative agreement that would be prohibited by State and
11 federal antitrust laws if undertaken without governmental
12 involvement. The purpose of this Act is to substitute
13 regulation for competition by creating an opportunity for the
14 State to review proposed agreements and to approve an
15 agreement under certain prescribed conditions and
16 circumstances under which an agreement is highly likely to
17 result in lower costs, greater access, and improved quality
18 for open-heart surgery in Health Service Area V, and would
19 not otherwise occur in the competitive health care
20 marketplace. The General Assembly intends that approval of an
21 agreement be accompanied by appropriate conditions,
22 supervision, and regulation to protect against private abuses
23 of economic power, and that an agreement approved by the
24 State Board and accompanied by appropriate conditions,
25 supervision, and regulation shall not be subject to State or
26 federal antitrust liability. The General Assembly finds that
27 the market for open-heart surgery is extremely diverse in
28 Illinois. Health Service Area V is believed to have
29 extraordinary rates of outmigration for open-heart surgery,
30 with residents traveling hundreds of miles, often
31 out-of-state, for care. Providing open-heart surgery close
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1 to home is medically useful to a patient's recovery, because
2 visits of families and friends can improve a patient's
3 psychosocial capacity to cope with disease. Providing
4 incentives to increase quality care for open-heart surgery in
5 areas without it is desirable.
6 Section 10. Definitions. In this Act:
7 "Access" means the financial, temporal, and geographic
8 availability of open-heart surgery to individuals who need
9 it.
10 "Applicants" means the parties to a cooperative agreement
11 for which a permit from the State Board is sought under this
12 Act.
13 "Cooperative agreement" means an agreement among 2 or
14 more health care providers for the sharing or allocation of
15 medical, diagnostic, or laboratory facilities or services
16 customarily offered by health care providers providing
17 open-heart surgery, including mergers, consolidations, or
18 other acquisitions.
19 "Cost" or "cost of health care" means the amount paid by
20 consumers or third-party payers for open-heart surgery.
21 "Criteria" means the cost, access, and quality of
22 open-heart surgery.
23 "Health care provider" or "provider" means any person
24 licensed by the State under the Hospital Licensing Act.
25 "Person" means an individual, legal entity, or affiliate.
26 "State Board" means the Cooperative Hospital Agreement
27 Board.
28 "Permitholder" means the party or parties to a
29 cooperative agreement for which a permit from the State Board
30 has been approved under this Act.
31 "Health Service Area V" means "HSA V" as defined by rule
32 of Illinois Health Facilities Planning Board in effect on the
33 effective date of this Act and consists of the following
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1 Illinois counties: Alexander, Bond, Clay, Crawford, Edwards,
2 Effingham, Fayette, Franklin, Gallatin, Hamilton, Hardin,
3 Jackson, Jasper, Jefferson, Johnson, Lawrence, Marion,
4 Massac, Perry, Pope, Pulaski, Randolph, Richland, Saline,
5 Union, Wabash, Washington, Wayne, White, and Williamson.
6 "Open-heart surgery" means a category of service which
7 utilizes any form of cardiac surgery which requires the
8 circulation of blood outside the body, as through a
9 heart-lung apparatus for carbon dioxide-oxygen exchange.
10 Section 15. Cooperative Hospital Agreement Board;
11 creation; members.
12 (a) The Cooperative Hospital Agreement Board is created
13 in the Office of the Director of Public Health. The State
14 Board shall consist of 11 members appointed by the Governor,
15 with the advice and consent of the Senate, from the following
16 groups and industries:
17 (1) Two practicing hospital administrators, one
18 from a hospital with fewer than 50 beds;
19 (2) One currently serving hospital board member;
20 (3) One practicing licensed physician;
21 (4) Two consumers;
22 (5) One health care payer;
23 (6) Two representatives from business and industry,
24 one of whom shall be an independent small business owner;
25 (7) One practicing attorney who has particular
26 knowledge or expertise in antitrust law; and
27 (8) One health care economist.
28 No more than 6 members of the State Board may be
29 affiliated with the same political party.
30 (b) The initial board shall be divided into one group of
31 4 members, one group of 3 members, and 2 groups of 2 members,
32 all as designated by the Governor. The term of the first
33 group shall expire on June 30, 2000, the term of the second
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1 group shall expire on June 30, 2001, the term of the third
2 group shall expire on June 30, 2002, and the term of the
3 fourth group shall expire on June 30, 2003. Thereafter, when
4 the term of any member expires, the successor shall be
5 appointed for a term of 4 years. Each member shall serve
6 until the member's resignation, death, or removal during that
7 member's term or, in the case of a member whose term has
8 expired, until a successor has been appointed and qualified.
9 The Governor shall fill any vacancy for the remainder of the
10 term. All members are eligible for reappointment but may
11 serve no more than 2 4-year terms, except that initial
12 appointees may serve 2 4-year terms in addition to their
13 initial term. No person may serve as a member of the State
14 Board or on the staff of the State Board while a member or on
15 the staff of the Illinois Health Facilities Planning Board.
16 (c) The nominees to membership on the State Board shall
17 disclose any potential conflicts of interest to the Governor
18 before accepting appointment. The State Board shall, as one
19 of its first actions, adopt rules to govern contacts and
20 communications between its members and applicants and shall
21 establish policies to require any member who has a conflict
22 of interest to immediately disclose that conflict and
23 disqualify himself or herself from voting in any proceeding
24 associated with the conflict of interest.
25 (d) One State Board member, designated by the Governor,
26 shall call and convene the initial organizational meeting of
27 the State Board and shall serve as its temporary chair. At
28 the initial meeting the State Board shall elect from its
29 membership a chair, vice-chair, and secretary. All State
30 Board officers shall hold office at the pleasure of the State
31 Board. The secretary, with whatever assistance the State
32 Board may prescribe, shall keep a record of the proceedings
33 of the State Board and shall be custodian of the minute
34 books, the State Board's official seal, and all books,
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1 documents, and papers filed with the State Board. Regular
2 meetings shall be held at least once every 3 months, at times
3 fixed by resolution of the State Board. Special meetings may
4 be held in accordance with the bylaws. All meetings of the
5 State Board shall be open to the public. A majority of the
6 State Board shall constitute a quorum for the transaction of
7 its business. Members shall receive reimbursement of their
8 expenses. All State Board meetings shall be deemed to have
9 been duly called and regularly held, and all orders and
10 proceedings of the State Board shall be deemed to have been
11 duly authorized, unless proved to the contrary.
12 (e) All State Board members shall serve at the pleasure
13 of the Governor, except that any member shall be removed by
14 the Governor if that member fails for any reason to attend 3
15 regular meetings during any 12-month period and the State
16 Board has not entered its approval of any absence in its
17 minutes. During their terms of office, all State Board
18 members are prohibited from being a party to a contract for
19 profit with the State Board.
20 (f) The Director of Public Health shall provide clerical
21 and professional staff and meeting facilities necessary for
22 the State Board to carry out its functions.
23 Section 20. Approval of cooperative agreements; powers
24 of the State Board. Approval of a cooperative agreement
25 requires a three-fourths vote of the State Board. On and
26 after March 1, 2000, the State Board shall not approve any
27 cooperative agreement. The State Board shall continue to
28 exercise all of its powers with respect to a cooperative
29 agreement approved before March 1, 2000, including without
30 limitation its power to terminate or modify its approval,
31 require the submission of reports and other information,
32 conduct audits, and subpoena witnesses and the production of
33 books, records, and documents.
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1 Section 25. Needs study. The State Board, in
2 consultation with the Attorney General, shall commission a
3 needs study to determine whether the goals of controlling
4 health care costs and improving the quality of and access to
5 open-heart surgery in Health Service Area V will be
6 significantly enhanced by a cooperative agreement that would
7 be prohibited by State or federal antitrust laws if
8 undertaken without governmental involvement. The study shall
9 be designed to determine whether hospital-based open-heart
10 surgery requires a cooperative agreement exempt from State
11 and federal antitrust laws and the feasibility of providing
12 open-heart surgery at a reasonable rate of return without
13 engaging in predatory pricing activities or any other abuse
14 of power, based upon reasonable assumptions of market
15 conditions in Health Service Area V. The study shall
16 consider all options for providing open-heart surgery for
17 Health Service Area V.
18 Section 30. Health care cooperative agreement; goals.
19 Acting by their boards of directors or boards of trustees or
20 as individuals, 2 or more health care providers may enter
21 into a cooperative agreement concerning sharing or allocation
22 of open-heart surgery facilities and services that shall be
23 designed to achieve the following goals in Health Service
24 Area V:
25 (1) reducing open-heart surgery costs for
26 consumers;
27 (2) improving access to open-heart surgery
28 services; and
29 (3) improving the quality of open-heart surgery
30 patient care.
31 Section 35. Approval of a health care cooperative
32 agreement.
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1 (a) Health care providers seeking to implement a
2 cooperative agreement that might be construed to be a
3 violation of State or federal antitrust laws but that is in
4 the best interest of the State and furthers the policies and
5 goals of this Act may apply for a permit from the State Board
6 as provided in this Section. This permit shall be in
7 addition to any permit or exemption required under any
8 provisions of the Illinois Health Facilities Planning Act.
9 Nothing in this Act shall be construed as requiring a health
10 care provider to obtain approval from the State Board of any
11 cooperative agreement. The decision to seek State Board
12 approval of a cooperative agreement shall be in the sole
13 discretion of the parties to the cooperative agreement. No
14 cooperative agreement implemented without first obtaining
15 approval from the State Board as provided in this Section
16 shall be eligible for any protection or immunity created by
17 Section 85.
18 (b) Applications for a permit shall be in a form
19 prescribed by the State Board but shall contain at least the
20 following:
21 (1) a descriptive title;
22 (2) a table of contents;
23 (3) names of each party to the application and the
24 address of the principal business office of each party;
25 (4) the names, addresses, and telephone numbers of
26 the persons authorized to receive notices and
27 communications with respect to the application;
28 (5) a verified statement by a responsible officer
29 of each party to the application attesting to the
30 accuracy and completeness of the enclosed information;
31 (6) background information relating to the proposed
32 agreement, including:
33 (A) a description of the proposed agreement;
34 (B) an identification of any tangential
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1 equipment associated with the proposed agreement;
2 (C) a description of that portion of Health
3 Service Area V involved in the proposed agreement;
4 (D) if the portion of Health Service Area V
5 described in item (C) is different from the portion
6 in which the applicants have engaged in the type of
7 business at issue over the last 5 years, a
8 description of how and why the portion differs;
9 (E) identification of all services that a
10 substantial share of consumers would consider
11 substitutes for open-heart surgery;
12 (F) identification of whether open-heart
13 surgery is currently being offered or is capable of
14 being offered by other providers in the portion of
15 Health Service Area V described in item (C);
16 (G) identification of the steps necessary,
17 under current market and regulatory conditions, for
18 other parties to enter the territory described in
19 item (C) and compete with the applicants;
20 (H) a description of the previous history of
21 dealings between the parties to the application;
22 (I) a detailed explanation of the projected
23 effects, including expected volume, change in price,
24 and increased revenue, of the agreement on each
25 party's current businesses, both generally and the
26 aspects of the business directly involved in the
27 proposed agreement;
28 (J) the present market share of the parties to
29 the application and of others affected by the
30 proposed agreement and projected market shares after
31 implementation of the proposed agreement;
32 (K) a statement of why the projected levels of
33 cost, access, and quality could not be achieved in
34 the existing market without the proposed agreement;
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1 (L) an explanation of how the agreement
2 relates to any Illinois health care plans for
3 delivery of health care; and
4 (M) a statement of any consideration received
5 or to be received by any party under the proposed
6 agreement;
7 (7) a detailed explanation or implementation plan
8 that states how and when the cooperative action
9 identified in the agreement will meet the goals specified
10 in Section 30;
11 (8) an explanation of the impact the agreement is
12 likely to have directly on the State, including the cost
13 of State employee health care, Medicaid costs, and
14 workers compensation costs;
15 (9) a copy of the proposed agreement; and
16 (10) a fee determined by the State Board, but in an
17 amount sufficient to cover the cost of processing
18 applications, including costs of the Attorney General and
19 the State Board, and the cost of periodic reviews and
20 supervision of the implementation of a cooperative
21 agreement under this Act.
22 (c) In addition to the information required in
23 subsection (b), the application must contain a written
24 description of the proposed agreement for purposes of
25 publication in the Illinois Register and in a newspaper of
26 general circulation in the area affected by the cooperative
27 agreement. The notice must include sufficient information to
28 advise the public of the nature of the proposed agreement and
29 to enable the public to provide meaningful comments
30 concerning the expected results of the agreement. The notice
31 must also state that any person may provide written comments
32 to the State Board, with copies to the applicants and to the
33 Attorney General, within 60 days after the notice's
34 publication. The State Board shall approve the notice before
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1 publication. If the State Board determines that the
2 submitted notice does not provide sufficient information, the
3 State Board may amend the notice before publication and may
4 consult with the applicants in preparing the amended notice.
5 The State Board shall not publish an amended notice without
6 the applicants' approval.
7 (d) For a proposed agreement involving multiple parties,
8 one joint application must be submitted on behalf of all
9 parties to the agreement.
10 (e) Trade secret information, as defined in the Freedom
11 of Information Act, shall be protected to the extent required
12 under that Act.
13 (f) If the Attorney General or the State Board
14 determines that an application is unclear, incomplete, or
15 provides an insufficient basis on which to base a decision,
16 the State Board shall return the application. The applicants
17 may complete or revise the application and resubmit it.
18 (g) The Attorney General or the State Board may decline
19 to review any application relating to agreements already in
20 effect before the submission of the application. However,
21 the State Board shall review any application if the review
22 is expressly provided for in a settlement agreement entered
23 into before the enactment of this Section by the applicants
24 and the Attorney General.
25 (h) Upon the showing of good cause, the State Board may
26 extend any of the time limits stated in this Act at the
27 request of the applicants or the Attorney General, except
28 that no application for permit to implement a cooperative
29 agreement shall be accepted by the State Board after October
30 31, 1999 or approved by the State Board after March 1, 2000.
31 Section 40. Notice and comment.
32 (a) The State Board shall cause the notice described in
33 subsection (c) of Section 35 to be published in the Illinois
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1 Register and in a newspaper of general circulation in the
2 area affected by the cooperative agreement. The State Board
3 shall also cause the notice to be delivered, by certified
4 mail, to persons affected by the proposed agreement and
5 identified in subparagraph (J) of paragraph (6) of subsection
6 (b) of Section 35. The State Board may send a copy of the
7 notice to any person together with a request that the person
8 comment as provided under subsection (b). Copies of the
9 request must be provided to the applicants.
10 (b) Within 30 days after the notice is published, any
11 person may mail to the State Board written comments with
12 respect to the application. Persons submitting comments
13 shall provide a copy of the comments to the applicants. The
14 applicants may mail to the State Board written responses to
15 any comments within 10 days after the deadline for mailing
16 comments. The applicants shall send a copy of the response
17 to the person submitting the comment.
18 (c) When an application for permit to implement a
19 cooperative agreement is made to the State Board, the State
20 Board shall commence a public hearing within a reasonable
21 period after receipt of the application, not to exceed 90
22 days. Notice of the hearing shall be made promptly to the
23 applicants, to the Attorney General, to any persons affected
24 by the proposed agreement and identified in subparagraph (J)
25 of paragraph (6) of subsection (b) of Section 35, and by
26 publication in a newspaper of general circulation in the area
27 affected by the cooperative agreement.
28 Section 45. Attorney General; review; recommendation.
29 (a) Upon receipt of an application for permit to
30 implement a cooperative agreement, the State Board shall
31 submit the application to the Attorney General for review.
32 The Attorney General shall review the application and shall
33 recommend to the State Board, in writing, the approval or
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1 denial of the application, provided the Attorney General's
2 review shall not include determinations under subsection (d)
3 or (e) of Section 50. If the Attorney General recommends to
4 the State Board the denial of an application, the Attorney
5 General shall state the reasons for that recommendation. The
6 State Board shall not approve any application if the Attorney
7 General recommends denial of the application, unless the
8 State Board determines there is a compelling State interest
9 in approving the application and there is a unanimous vote of
10 its members.
11 Section 50. Criteria for issuance of permit.
12 (a) The State Board may issue a permit to implement a
13 cooperative agreement if the Attorney General and the State
14 Board determine that the applicants have demonstrated by
15 clear and convincing evidence that:
16 (1) the goals specified in Section 30 are highly
17 likely to be met by implementing the proposed cooperative
18 agreement and would not otherwise occur under existing
19 market conditions or conditions likely to develop without
20 an exemption or immunity from State and federal
21 antitrust law; and
22 (2) the benefits resulting from the agreement are
23 highly likely to outweigh the disadvantages that may
24 result from the agreement, and that predatory pricing or
25 any other abuse of power will not occur. In making that
26 determination, the Attorney General and the State Board
27 shall employ a cost-benefit analysis and the needs study.
28 (b) In making a determination about cost, access, and
29 quality, the Attorney General and the State Board shall
30 consider the following factors, among others:
31 (1) whether the proposal is compatible with cost
32 containment or plans of the Illinois Health Facilities
33 Planning Board.
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1 (2) market structure:
2 (A) actual and potential sellers and buyers or
3 providers and purchasers;
4 (B) actual and potential consumers;
5 (C) geographic market area;
6 (D) new delivery mechanisms; and
7 (E) entry conditions;
8 (3) current market conditions;
9 (4) the historical behavior of the market;
10 (5) performance of other similar agreements;
11 (6) whether the proposal unnecessarily restrains
12 competition or restrains competition in ways not
13 reasonably related to the purposes of this Act;
14 (7) whether competition as it currently exists in
15 the market is likely to produce better results in terms
16 of cost, access and quality; and
17 (8) the financial condition of the applicants.
18 (c) The analysis of cost must focus on the individual
19 consumer of health care. Cost savings to be realized by
20 providers, health carriers, group purchasers, or other
21 participants in the health care system, are relevant only to
22 the extent that the savings are highly likely to be passed on
23 to the consumer. Where an application is submitted by
24 providers who are paid primarily by third party payers
25 unaffiliated with the providers, however, it is sufficient
26 for the providers to show that cost savings are highly likely
27 to be passed on to the unaffiliated third party payers and
28 the providers do not have the burden of proving that third
29 party payers with whom the providers are not affiliated will
30 pass on cost savings to individuals receiving coverage
31 through the third party payers. In making determinations as
32 to costs, the Attorney General and the State Board shall
33 consider, among other matters:
34 (1) the cost savings likely to result to the
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1 applicants;
2 (2) the extent to which the cost savings are likely
3 to be passed on to the consumer and in what form;
4 (3) the extent to which the proposed agreement is
5 likely to result in cost shifting by the applicants onto
6 other payers or purchasers of other products or services;
7 (4) the extent to which the cost shifting by the
8 applicants is likely to be followed by other persons in
9 the market;
10 (5) the current and anticipated supply and demand
11 for any products or services at issue;
12 (6) the representations and guarantees of the
13 applicants and their enforceability;
14 (7) likely effectiveness of regulation by the State
15 Board;
16 (8) inferences to be drawn from market structure;
17 (9) the cost of regulation, both for the State and
18 for the applicants; and
19 (10) any other factors tending to show that the
20 proposed agreement is or is not highly likely to reduce
21 cost.
22 (d) In making determinations as to access, the State
23 Board shall consider, among other matters:
24 (1) the extent to which the use of open-heart
25 surgery by the intended targeted population is highly
26 likely to increase or decrease; when a proposed agreement
27 is highly likely to increase access in one geographic
28 area, by lowering prices or otherwise expanding supply,
29 but limits access in another geographic area by removing
30 service capabilities from that second area, the State
31 Board shall articulate the criteria employed to balance
32 these effects;
33 (2) the extent to which the proposed agreement is
34 highly likely to make available a new and needed service
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1 or product to a certain geographic area; and
2 (3) the extent to which the proposed agreement is
3 highly likely to otherwise make open-heart surgery more
4 financially or geographically available to persons who
5 need them. If the State Board determines that the
6 proposed agreement is highly likely to increase access
7 and bases that determination on a projected increase in
8 utilization, the State Board shall also determine and
9 make a specific finding that the increase in utilization
10 does not reflect overutilization.
11 (e) In making determinations as to quality, the State
12 Board shall consider, among others, the extent to which the
13 proposed agreement is highly likely to:
14 (1) decrease morbidity and mortality;
15 (2) result in faster convalescence;
16 (3) result in fewer hospital days;
17 (4) permit providers to attain needed experience or
18 frequency of treatment, highly likely to lead to better
19 outcomes;
20 (5) increase patient satisfaction;
21 (6) results in modern health care facilities; and
22 (7) have any other features likely to improve or
23 reduce the quality of health care.
24 Section 55. Decision.
25 (a) The State Board shall issue a written decision
26 approving or denying the application for permit. The State
27 Board may condition approval on a modification of all or part
28 of the proposed agreement to eliminate any restriction on
29 competition that is not reasonably related to the goals of
30 reducing cost or improving access or quality. The State
31 Board shall, independently or upon recommendation of the
32 Attorney General, also establish conditions for approval that
33 are reasonably necessary to protect consumers against
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1 predatory pricing, insufficient competition, or other abuses
2 of private economic power and to ensure that the agreement is
3 appropriately supervised and regulated by the State.
4 (b) The State Board's decision shall make specific
5 findings of fact concerning the cost, access, and quality
6 criteria.
7 (c) A decision approving an application for permit shall
8 require the submission of specific data and reports
9 concerning the implementation of the agreement, including how
10 the agreement is accomplishing its goals, data relating to
11 cost, access, and quality, and to the extent feasible,
12 identify objective standards of cost, access, and quality by
13 which the success of the agreement will be measured. The
14 submission of the data and reports shall be required at least
15 annually. The Attorney General shall receive copies of any
16 reports received by the State Board.
17 Section 60. Appeal. The decision of the State Board to
18 approve or deny a permit to implement a cooperative agreement
19 is subject to the provisions of the Administrative Review
20 Law. Any person who is adversely affected by a decision of
21 the State Board to approve or deny a permit to implement a
22 cooperative agreement may have that decision judicially
23 reviewed.
24 Section 65. Supervision after approval.
25 (a) The State Board, in consultation with the Attorney
26 General, shall supervise, monitor, and regulate approved
27 agreements.
28 (b) The Attorney General and the State Board shall review
29 data submitted periodically by the permitholder. The permit
30 issued by the State Board shall set forth the time schedule
31 for the submission of data to the State Board and to the
32 Attorney General, which shall be at least once a year. The
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1 permit shall identify the data that must be submitted,
2 including all data relevant to the pricing and costs of
3 health care services, and the Attorney General and the State
4 Board may subsequently require the submission of additional
5 data or alter the time schedule. Upon review of the data
6 submitted, the State Board shall notify the permitholder of
7 whether the agreement or its implementation is in compliance
8 with the permit. Implementation of the agreement shall not
9 be in compliance if, at any time, the permitholder has either
10 (i) raised any prices in excess of the consumer price index
11 or (ii) lowered any prices in an amount greater than any
12 reduction in costs for the relevant services. If the
13 agreement or its implementation is not in compliance with the
14 permit, the Attorney General or the State Board shall
15 identify those respects in which the agreement or its
16 implementation does not conform to the permit. The Attorney
17 General or the State Board may require the submission of
18 information from any other market participant. A permitholder
19 receiving notification that an agreement or its
20 implementation is not in compliance has 30 days in which to
21 respond with additional data. The response may include a
22 proposal and a time schedule by which the permitholder will
23 bring the agreement or its implementation into compliance
24 with the permit. If the agreement or its implementation is
25 not in compliance and the State Board and the permitholder
26 cannot agree to the terms for bringing the agreement or its
27 implementation into compliance, the matter shall be set for a
28 hearing before a hearing officer appointed by the State
29 Board. The State Board shall publish notice in the Illinois
30 Register and in a newspaper of general circulation in the
31 area affected by the cooperative agreement one year after the
32 date of issuance of a permit approving an application, and at
33 2 year intervals thereafter, soliciting comments from the
34 public concerning the impact that the agreement or its
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1 implementation has had on cost, access, and quality. The
2 Attorney General and the State Board may request additional
3 oral or written information from the permitholder or from any
4 other source.
5 Section 70. Administrative fine. In addition to any
6 remedies available under Section 75, if the State Board
7 determines that a party to a cooperative agreement is not in
8 compliance with the terms of the agreement or its
9 implementation, the State Board may impose an administrative
10 fine of up to $10,000 for each day the party is not in
11 compliance.
12 Section 75. Revocation.
13 (a) The State Board may revoke a permit to implement a
14 cooperative agreement if it finds by clear and convincing
15 evidence that:
16 (1) Any of the following circumstances exist:
17 (A) the agreement or its implementation is not
18 in substantial compliance with the terms of the
19 application;
20 (B) the agreement or its implementation is not
21 in substantial compliance with the conditions of
22 approval;
23 (C) the agreement has not and is not likely to
24 substantially achieve the improvements in cost,
25 access, or quality identified in the permit as the
26 basis for the State Board's approval of the
27 agreement;
28 (D) the benefits resulting from the agreement
29 do not outweigh the disadvantages attributable to
30 any reduction in competition;
31 (E) the conditions in the market place have
32 changed to such an extent that competition would
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1 promote reductions in cost and improvements in
2 access and quality better than does the agreement at
3 issue; in order to revoke on the basis that
4 conditions in the marketplace have changed, the
5 State Board shall identify specific changes in the
6 marketplace and articulate why those changes warrant
7 revocation;
8 (F) the parties to the agreement fail to submit
9 periodic progress reports requested by the State
10 Board;
11 (G) materially misleading information was
12 submitted in the application; or
13 (H) the parties have failed to implement the
14 agreement with due diligence; and
15 (2) The parties to the agreement have failed to
16 provide reasonable proposals for alternatives to
17 revocation and have rejected modifications to or
18 restructuring of the agreement identified by the State
19 Board pursuant to subsection (d) of this Section.
20 (b) If a party to an agreement that is the subject of a
21 permit seeks to terminate its participation in the agreement,
22 the party shall file a notice of termination with the State
23 Board at least 30 days prior to the proposed effective date
24 of the termination. Upon receipt of a notice of termination,
25 the State Board may institute revocation proceedings. If any
26 parties seek to terminate the agreement, the parties shall
27 file a notice of termination at least 30 days prior to the
28 proposed effective date of the termination.
29 (c) The State Board shall begin a proceeding to revoke a
30 permit to implement a cooperative agreement by providing
31 written notice to the permitholder describing in detail the
32 basis for the proposed revocation. Notice of the proceeding
33 must be published in the Illinois Register. The notice must
34 invite the submission of comments to the State Board.
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1 (d) In deciding whether to revoke a permit to implement a
2 cooperative agreement, the State Board shall take into
3 account the hardship that the revocation may impose on the
4 applicants and any potential disruption of the market as a
5 whole. The State Board shall not revoke an approval if the
6 agreement can be modified, restructured, or regulated so as
7 to remedy the problem upon which the revocation proceeding is
8 based. The permitholder may submit proposals for alternatives
9 to revocation. Before approving an alternative to revocation
10 that involves modifying or restructuring an agreement, the
11 State Board shall publish notice in the Illinois Register
12 that any person may comment on the proposed modification or
13 restructuring within 20 days after publication of the notice.
14 The State Board shall not approve the modification or
15 restructuring until the comment period has concluded. An
16 approved modified or restructured agreement is subject to
17 supervision under Section 65.
18 (e) The permitholder cannot be held liable under State or
19 federal antitrust law for unintentional acts that occurred
20 while the permit was in effect, except to the extent that the
21 permitholder failed to comply with the terms of the permit.
22 The permitholder is fully subject to State and federal
23 antitrust law after the revocation becomes effective and may
24 be held liable for acts that occur after the revocation.
25 Section 80. Recordkeeping. The State Board shall
26 maintain a file of all agreements for which approval orders
27 are issued and that remain in effect.
28 Section 85. Health care provider cooperative agreements;
29 antitrust exemption.
30 (a) This Act does not confer authority to engage in
31 agreements, tacit, implied, or express, which are not
32 submitted to the State Board for approval if those agreements
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1 are in violation of State or federal antitrust laws. Conduct
2 seemingly pursuant to provisions of this law done without the
3 good faith intention to accomplish an agreement approved by
4 the State Board is not entitled to the protections and
5 immunities of this Section.
6 (b) It is the intent of this Act to require the State,
7 through the State Board, to provide direction, supervision,
8 and control over a cooperative agreement. To achieve the
9 goals specified in Section 30, this State direction,
10 supervision, and control will provide immunity from any civil
11 or criminal liability under the Illinois Antitrust Act and
12 State-action immunity under federal antitrust laws to (i)
13 health care providers, their governing board members, and
14 their officers, agents, and employees who take authorized
15 actions to implement a cooperative agreement approved under
16 this Act and (ii) persons representing health care providers
17 who participate in discussions or negotiations concerning the
18 allocation of open-heart surgery as authorized under this
19 Act.
20 Section 90. Health care cooperative agreement; Attorney
21 General action. The Attorney General shall have all the
22 powers necessary or convenient for the representation and
23 protection of the public interest in all proceedings under
24 this Act, including, without limitation, the right to
25 intervene as a party or otherwise participate in any
26 proceeding under this Act. Nothing in this Act shall limit
27 the authority of the Attorney General to initiate an action
28 to enforce the civil or criminal liability provisions of the
29 Illinois Antitrust Act if the Attorney General determines
30 that a health care provider, the members of its governing
31 board, or its officers, agents, or employees have exceeded
32 the scope of the actions authorized under this Act.
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1 Section 95. Rulemaking. If necessary to meet the March
2 1, 2000 approval deadline, the State Board shall adopt rules
3 for the operation of this Act under the emergency rulemaking
4 provisions of Section 5-45 of the Illinois Administrative
5 Procedure Act. Within 150 days of the adoption of rules
6 under Section 5-45, the State Board shall adopt identical or
7 different rules under the general rulemaking provisions of
8 Section 5-40 of that Act.
9 Section 100. Investigations. The Attorney General or
10 the State Board, at any time after an application is filed or
11 approved under this Act, may require by subpoena the
12 attendance and testimony of witnesses and the production of
13 documents for the purpose of investigating whether the
14 cooperative agreement satisfies the standards set forth in
15 this Act. The Attorney General or the State Board may seek a
16 court order compelling compliance with a subpoena issued
17 under this Section.
18 Section 200. The Illinois Antitrust Act is amended by
19 changing Section 5 as follows:
20 (740 ILCS 10/5) (from Ch. 38, par. 60-5)
21 Sec. 5. Exceptions. No provisions of this Act shall be
22 construed to make illegal:
23 (1) the activities of any labor organization or of
24 individual members thereof which are directed solely to labor
25 objectives which are legitimate under the laws of either the
26 State of Illinois or the United States;
27 (2) the activities of any agricultural or horticultural
28 cooperative organization, whether incorporated or
29 unincorporated, or of individual members thereof, which are
30 directed solely to objectives of such cooperative
31 organizations which are legitimate under the laws of either
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1 the State of Illinois or the United States;
2 (3) the activities of any public utility, as defined in
3 Section 3-105 of the Public Utilities Act to the extent that
4 such activities are subject to a clearly articulated and
5 affirmatively expressed State policy to replace competition
6 with regulation, where the conduct to be exempted is actively
7 supervised by the State itself;
8 (4) The activities of a telecommunications carrier, as
9 defined in Section 13-202 of the Public Utilities Act, to the
10 extent those activities relate to the provision of
11 noncompetitive telecommunications services under the Public
12 Utilities Act and are subject to the jurisdiction of the
13 Illinois Commerce Commission or to the activities of
14 telephone mutual concerns referred to in Section 13-202 of
15 the Public Utilities Act to the extent those activities
16 relate to the provision and maintenance of telephone service
17 to owners and customers;
18 (5) the activities (including, but not limited to, the
19 making of or participating in joint underwriting or joint
20 reinsurance arrangement) of any insurer, insurance agent,
21 insurance broker, independent insurance adjuster or rating
22 organization to the extent that such activities are subject
23 to regulation by the Director of Insurance of this State
24 under, or are permitted or are authorized by, the Insurance
25 Code or any other law of this State;
26 (6) the religious and charitable activities of any
27 not-for-profit corporation, trust or organization established
28 exclusively for religious or charitable purposes, or for both
29 purposes;
30 (7) the activities of any not-for-profit corporation
31 organized to provide telephone service on a mutual or
32 co-operative basis or electrification on a co-operative
33 basis, to the extent such activities relate to the marketing
34 and distribution of telephone or electrical service to owners
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1 and customers;
2 (8) the activities engaged in by securities dealers who
3 are (i) licensed by the State of Illinois or (ii) members of
4 the National Association of Securities Dealers or (iii)
5 members of any National Securities Exchange registered with
6 the Securities and Exchange Commission under the Securities
7 Exchange Act of 1934, as amended, in the course of their
8 business of offering, selling, buying and selling, or
9 otherwise trading in or underwriting securities, as agent,
10 broker, or principal, and activities of any National
11 Securities Exchange so registered, including the
12 establishment of commission rates and schedules of charges;
13 (9) the activities of any board of trade designated as a
14 "contract market" by the Secretary of Agriculture of the
15 United States pursuant to Section 5 of the Commodity Exchange
16 Act, as amended;
17 (10) the activities of any motor carrier, rail carrier,
18 or common carrier by pipeline, as defined in the Common
19 Carrier by Pipeline Law of the Public Utilities Act, to the
20 extent that such activities are permitted or authorized by
21 the Act or are subject to regulation by the Illinois Commerce
22 Commission;
23 (11) the activities of any State or national bank to the
24 extent that such activities are regulated or supervised by
25 officers of the State or federal government under the banking
26 laws of this State or the United States;
27 (12) the activities of any State or federal savings and
28 loan association to the extent that such activities are
29 regulated or supervised by officers of the state or federal
30 government under the savings and loan laws of this State or
31 the United States;
32 (13) the activities of any bona fide not-for-profit
33 association, society or board, of attorneys, practitioners of
34 medicine, architects, engineers, land surveyors or real
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1 estate brokers licensed and regulated by an agency of the
2 State of Illinois, in recommending schedules of suggested
3 fees, rates or commissions for use solely as guidelines in
4 determining charges for professional and technical services;
5 (14) Conduct involving trade or commerce (other than
6 import trade or import commerce) with foreign nations unless:
7 (a) such conduct has a direct, substantial, and
8 reasonably foreseeable effect:
9 (i) on trade or commerce which is not trade or
10 commerce with foreign nations, or on import trade or
11 import commerce with foreign nations; or
12 (ii) on export trade or export commerce with
13 foreign nations of a person engaged in such trade or
14 commerce in the United States; and
15 (b) such effect gives rise to a claim under the
16 provisions of this Act, other than this subsection (14).
17 (c) If this Act applies to conduct referred to in
18 this subsection (14) only because of the provisions of
19 paragraph (a)(ii), then this Act shall apply to such
20 conduct only for injury to export business in the United
21 States which affects this State; or
22 (15) the activities of a unit of local government or
23 school district and the activities of the employees, agents
24 and officers of a unit of local government or school district
25 ; or
26 (16) the activities of any person licensed by the State
27 of Illinois under the Hospital Licensing Act or such a
28 licensee's governing board members and officers, in
29 discussing, negotiating, and entering into a cooperative
30 agreement or in implementing an approved cooperative
31 agreement with another licensed hospital to develop and
32 jointly operate under State supervision hospital-based
33 open-heart surgery as authorized under the Hospital
34 Cooperation Act.
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1 (Source: P.A. 90-185, eff. 7-23-97; 90-561, eff. 12-16-97.)
2 Section 999. Effective date. This Act takes effect upon
3 becoming law.
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