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91_SB0251enr
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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 and Patient Rights Act.
7 Section 5. Health care patient rights.
8 (a) The General Assembly finds that:
9 (1) A patient has the right to care consistent with
10 professional standards of practice to assure quality
11 nursing and medical practices, to choose the
12 participating physician responsible for coordinating his
13 or her care, to receive information concerning his or her
14 condition and proposed treatment, to refuse any treatment
15 to the extent permitted by law, and to privacy and
16 confidentiality of records except as otherwise provided
17 by law.
18 (2) A patient has the right, regardless of source
19 of payment, to examine and to receive a reasonable
20 explanation of his or her total bill for health care
21 services rendered by his or her physician or other health
22 care provider, including the itemized charges for
23 specific health care services received. A physician or
24 other health care provider has responsibility only for a
25 reasonable explanation of those specific health care
26 services provided by the health care provider.
27 (3) A patient has the right to timely prior notice
28 of the termination whenever a health care plan cancels or
29 refuses to renew an enrollee's participation in the plan.
30 (4) A patient has the right to privacy and
31 confidentiality in health care. This right may be
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1 expressly waived in writing by the patient or the
2 patient's guardian.
3 (5) An individual has the right to purchase any
4 health care services with that individual's own funds.
5 (b) Nothing in this Section shall preclude the health
6 care plan from sharing information for plan quality
7 assessment and improvement purposes as required by Section
8 80.
9 Section 10. Definitions:
10 "Adverse determination" means a determination by a health
11 care plan under Section 45 or by a utilization review program
12 under Section 85 that a health care service is not medically
13 necessary.
14 "Clinical peer" means a health care professional who is
15 in the same profession and the same or similar specialty as
16 the health care provider who typically manages the medical
17 condition, procedures, or treatment under review.
18 "Department" means the Department of Insurance.
19 "Emergency medical condition" means a medical condition
20 manifesting itself by acute symptoms of sufficient severity
21 (including, but not limited to, severe pain) such that a
22 prudent layperson, who possesses an average knowledge of
23 health and medicine, could reasonably expect the absence of
24 immediate medical attention to result in:
25 (1) placing the health of the individual (or, with
26 respect to a pregnant woman, the health of the woman or
27 her unborn child) in serious jeopardy;
28 (2) serious impairment to bodily functions; or
29 (3) serious dysfunction of any bodily organ or
30 part.
31 "Emergency medical screening examination" means a medical
32 screening examination and evaluation by a physician licensed
33 to practice medicine in all its branches, or to the extent
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1 permitted by applicable laws, by other appropriately licensed
2 personnel under the supervision of or in collaboration with a
3 physician licensed to practice medicine in all its branches
4 to determine whether the need for emergency services exists.
5 "Emergency services" means, with respect to an enrollee
6 of a health care plan, transportation services, including but
7 not limited to ambulance services, and covered inpatient and
8 outpatient hospital services furnished by a provider
9 qualified to furnish those services that are needed to
10 evaluate or stabilize an emergency medical condition.
11 "Emergency services" does not refer to post-stabilization
12 medical services.
13 "Enrollee" means any person and his or her dependents
14 enrolled in or covered by a health care plan.
15 "Health care plan" means a plan that establishes,
16 operates, or maintains a network of health care providers
17 that has entered into an agreement with the plan to provide
18 health care services to enrollees to whom the plan has the
19 ultimate obligation to arrange for the provision of or
20 payment for services through organizational arrangements for
21 ongoing quality assurance, utilization review programs, or
22 dispute resolution. Nothing in this definition shall be
23 construed to mean that an independent practice association or
24 a physician hospital organization that subcontracts with a
25 health care plan is, for purposes of that subcontract, a
26 health care plan.
27 For purposes of this definition, "health care plan" shall
28 not include the following:
29 (1) indemnity health insurance policies including
30 those using a contracted provider network;
31 (2) health care plans that offer only dental or
32 only vision coverage;
33 (3) preferred provider administrators, as defined
34 in Section 370g(g) of the Illinois Insurance Code;
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1 (4) employee or employer self-insured health
2 benefit plans under the federal Employee Retirement
3 Income Security Act of 1974;
4 (5) health care provided pursuant to the Workers'
5 Compensation Act or the Workers' Occupational Diseases
6 Act; and
7 (6) not-for-profit voluntary health services plans
8 with health maintenance organization authority in
9 existence as of January 1, 1999 that are affiliated with
10 a union and that only extend coverage to union members
11 and their dependents.
12 "Health care professional" means a physician, a
13 registered professional nurse, or other individual
14 appropriately licensed or registered to provide health care
15 services.
16 "Health care provider" means any physician, hospital
17 facility, or other person that is licensed or otherwise
18 authorized to deliver health care services. Nothing in this
19 Act shall be construed to define Independent Practice
20 Associations or Physician-Hospital Organizations as health
21 care providers.
22 "Health care services" means any services included in the
23 furnishing to any individual of medical care, or the
24 hospitalization incident to the furnishing of such care, as
25 well as the furnishing to any person of any and all other
26 services for the purpose of preventing, alleviating, curing,
27 or healing human illness or injury including home health and
28 pharmaceutical services and products.
29 "Medical director" means a physician licensed in any
30 state to practice medicine in all its branches appointed by a
31 health care plan.
32 "Person" means a corporation, association, partnership,
33 limited liability company, sole proprietorship, or any other
34 legal entity.
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1 "Physician" means a person licensed under the Medical
2 Practice Act of 1987.
3 "Post-stabilization medical services" means health care
4 services provided to an enrollee that are furnished in a
5 licensed hospital by a provider that is qualified to furnish
6 such services, and determined to be medically necessary and
7 directly related to the emergency medical condition following
8 stabilization.
9 "Stabilization" means, with respect to an emergency
10 medical condition, to provide such medical treatment of the
11 condition as may be necessary to assure, within reasonable
12 medical probability, that no material deterioration of the
13 condition is likely to result.
14 "Utilization review" means the evaluation of the medical
15 necessity, appropriateness, and efficiency of the use of
16 health care services, procedures, and facilities.
17 "Utilization review program" means a program established
18 by a person to perform utilization review.
19 Section 15. Provision of information.
20 (a) A health care plan shall provide annually to
21 enrollees and prospective enrollees, upon request, a complete
22 list of participating health care providers in the health
23 care plan's service area and a description of the following
24 terms of coverage:
25 (1) the service area;
26 (2) the covered benefits and services with all
27 exclusions, exceptions, and limitations;
28 (3) the pre-certification and other utilization
29 review procedures and requirements;
30 (4) a description of the process for the selection
31 of a primary care physician, any limitation on access to
32 specialists, and the plan's standing referral policy;
33 (5) the emergency coverage and benefits, including
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1 any restrictions on emergency care services;
2 (6) the out-of-area coverage and benefits, if any;
3 (7) the enrollee's financial responsibility for
4 copayments, deductibles, premiums, and any other
5 out-of-pocket expenses;
6 (8) the provisions for continuity of treatment in
7 the event a health care provider's participation
8 terminates during the course of an enrollee's treatment
9 by that provider;
10 (9) the appeals process, forms, and time frames for
11 health care services appeals, complaints, and external
12 independent reviews, administrative complaints, and
13 utilization review complaints, including a phone number
14 to call to receive more information from the health care
15 plan concerning the appeals process; and
16 (10) a statement of all basic health care services
17 and all specific benefits and services mandated to be
18 provided to enrollees by any State law or administrative
19 rule.
20 In the event of an inconsistency between any separate
21 written disclosure statement and the enrollee contract or
22 certificate, the terms of the enrollee contract or
23 certificate shall control.
24 (b) Upon written request, a health care plan shall
25 provide to enrollees a description of the financial
26 relationships between the health care plan and any health
27 care provider and, if requested, the percentage of
28 copayments, deductibles, and total premiums spent on
29 healthcare related expenses and the percentage of copayments,
30 deductibles, and total premiums spent on other expenses,
31 including administrative expenses, except that no health care
32 plan shall be required to disclose specific provider
33 reimbursement.
34 (c) A participating health care provider shall provide
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1 all of the following, where applicable, to enrollees upon
2 request:
3 (1) Information related to the health care
4 provider's educational background, experience, training,
5 specialty, and board certification, if applicable.
6 (2) The names of licensed facilities on the
7 provider panel where the health care provider presently
8 has privileges for the treatment, illness, or procedure
9 that is the subject of the request.
10 (3) Information regarding the health care
11 provider's participation in continuing education
12 programs and compliance with any licensure,
13 certification, or registration requirements, if
14 applicable.
15 (d) A health care plan shall provide the information
16 required to be disclosed under this Act upon enrollment and
17 annually thereafter in a legible and understandable format.
18 The Department shall promulgate rules to establish the format
19 based, to the extent practical, on the standards developed
20 for supplemental insurance coverage under Title XVIII of the
21 federal Social Security Act as a guide, so that a person can
22 compare the attributes of the various health care plans.
23 (e) The written disclosure requirements of this Section
24 may be met by disclosure to one enrollee in a household.
25 Section 20. Notice of nonrenewal or termination. A
26 health care plan must give at least 60 days notice of
27 nonrenewal or termination of a health care provider to the
28 health care provider and to the enrollees served by the
29 health care provider. The notice shall include a name and
30 address to which an enrollee or health care provider may
31 direct comments and concerns regarding the nonrenewal or
32 termination. Immediate written notice may be provided without
33 60 days notice when a health care provider's license has been
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1 disciplined by a State licensing board.
2 Section 25. Transition of services.
3 (a) A health care plan shall provide for continuity of
4 care for its enrollees as follows:
5 (1) If an enrollee's physician leaves the health
6 care plan's network of health care providers for reasons
7 other than termination of a contract in situations
8 involving imminent harm to a patient or a final
9 disciplinary action by a State licensing board and the
10 physician remains within the health care plan's service
11 area, the health care plan shall permit the enrollee to
12 continue an ongoing course of treatment with that
13 physician during a transitional period:
14 (A) of 90 days from the date of the notice of
15 physician's termination from the health care plan to
16 the enrollee of the physician's disaffiliation from
17 the health care plan if the enrollee has an ongoing
18 course of treatment; or
19 (B) if the enrollee has entered the third
20 trimester of pregnancy at the time of the
21 physician's disaffiliation, that includes the
22 provision of post-partum care directly related to
23 the delivery.
24 (2) Notwithstanding the provisions in item (1) of
25 this subsection, such care shall be authorized by the
26 health care plan during the transitional period only if
27 the physician agrees:
28 (A) to continue to accept reimbursement from
29 the health care plan at the rates applicable prior
30 to the start of the transitional period;
31 (B) to adhere to the health care plan's
32 quality assurance requirements and to provide to the
33 health care plan necessary medical information
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1 related to such care; and
2 (C) to otherwise adhere to the health care
3 plan's policies and procedures, including but not
4 limited to procedures regarding referrals and
5 obtaining preauthorizations for treatment.
6 (b) A health care plan shall provide for continuity of
7 care for new enrollees as follows:
8 (1) If a new enrollee whose physician is not a
9 member of the health care plan's provider network, but is
10 within the health care plan's service area, enrolls in
11 the health care plan, the health care plan shall permit
12 the enrollee to continue an ongoing course of treatment
13 with the enrollee's current physician during a
14 transitional period:
15 (A) of 90 days from the effective date of
16 enrollment if the enrollee has an ongoing course of
17 treatment; or
18 (B) if the enrollee has entered the third
19 trimester of pregnancy at the effective date of
20 enrollment, that includes the provision of
21 post-partum care directly related to the delivery.
22 (2) If an enrollee elects to continue to receive
23 care from such physician pursuant to item (1) of this
24 subsection, such care shall be authorized by the health
25 care plan for the transitional period only if the
26 physician agrees:
27 (A) to accept reimbursement from the health
28 care plan at rates established by the health care
29 plan; such rates shall be the level of reimbursement
30 applicable to similar physicians within the health
31 care plan for such services;
32 (B) to adhere to the health care plan's
33 quality assurance requirements and to provide to the
34 health care plan necessary medical information
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1 related to such care; and
2 (C) to otherwise adhere to the health care
3 plan's policies and procedures including, but not
4 limited to procedures regarding referrals and
5 obtaining preauthorization for treatment.
6 (c) In no event shall this Section be construed to
7 require a health care plan to provide coverage for benefits
8 not otherwise covered or to diminish or impair preexisting
9 condition limitations contained in the enrollee's contract.
10 Section 30. Prohibitions.
11 (a) No health care plan or its subcontractors may
12 prohibit or discourage health care providers by contract or
13 policy from discussing any health care services and health
14 care providers, utilization review and quality assurance
15 policies, terms and conditions of plans and plan policy with
16 enrollees, prospective enrollees, providers, or the public.
17 (b) No health care plan by contract, written policy, or
18 procedure may permit or allow an individual or entity to
19 dispense a different drug in place of the drug or brand of
20 drug ordered or prescribed without the express permission of
21 the person ordering or prescribing the drug, except as
22 provided under Section 3.14 of the Illinois Food, Drug and
23 Cosmetic Act.
24 (c) Any violation of this Section shall be subject to
25 the penalties under this Act.
26 Section 35. Medically appropriate health care
27 protection.
28 (a) No health care plan or its subcontractors shall
29 retaliate against a physician or other health care provider
30 who advocates for appropriate health care services for
31 patients.
32 (b) It is the public policy of the State of Illinois
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1 that a physician or any other health care provider be
2 encouraged to advocate for medically appropriate health care
3 services for his or her patients. For purposes of this
4 Section, "to advocate for medically appropriate health care
5 services" means to appeal a decision to deny payment for a
6 health care service pursuant to the reasonable grievance or
7 appeal procedure established by a health care plan or to
8 protest a decision, policy, or practice that the physician or
9 other health care provider, consistent with that degree of
10 learning and skill ordinarily possessed by physicians or
11 other health care providers practicing in the same or a
12 similar locality and under similar circumstances, reasonably
13 believes impairs the physician's or other health care
14 provider's ability to provide appropriate health care
15 services to his or her patients.
16 (c) This Section shall not be construed to prohibit a
17 health care plan or its subcontractors from making a
18 determination not to pay for a particular health care service
19 or to prohibit a medical group, independent practice
20 association, preferred provider organization, foundation,
21 hospital medical staff, hospital governing body or health
22 care plan from enforcing reasonable peer review or
23 utilization review protocols or determining whether a
24 physician or other health care provider has complied with
25 those protocols.
26 (d) Nothing in this Section shall be construed to
27 prohibit the governing body of a hospital or the hospital
28 medical staff from taking disciplinary actions against a
29 physician as authorized by law.
30 (e) Nothing in this Section shall be construed to
31 prohibit the Department of Professional Regulation from
32 taking disciplinary actions against a physician or other
33 health care provider under the appropriate licensing Act.
34 (f) Any violation of this Section shall be subject to
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1 the penalties under this Act.
2 Section 40. Access to specialists.
3 (a) All health care plans that require each enrollee to
4 select a health care provider for any purpose including
5 coordination of care shall permit an enrollee to choose any
6 available primary care physician licensed to practice
7 medicine in all its branches participating in the health care
8 plan for that purpose. The health care plan shall provide the
9 enrollee with a choice of licensed health care providers who
10 are accessible and qualified. Nothing in this Act shall be
11 construed to prohibit a health care plan from requiring a
12 health care provider to meet the health care plan's criteria
13 in order to coordinate access to health care.
14 (b) A health care plan shall establish a procedure by
15 which an enrollee who has a condition that requires ongoing
16 care from a specialist physician or other health care
17 provider may apply for a standing referral to a specialist
18 physician or other health care provider if a referral to a
19 specialist physician or other health care provider is
20 required for coverage. The application shall be made to the
21 enrollee's primary care physician. This procedure for a
22 standing referral must specify the necessary criteria and
23 conditions that must be met in order for an enrollee to
24 obtain a standing referral. A standing referral shall be
25 effective for the period necessary to provide the referred
26 services or one year, except in the event of termination of a
27 contract or policy in which case Section 25 on transition of
28 services shall apply, if applicable. A primary care physician
29 may renew and re-renew a standing referral.
30 (c) The enrollee may be required by the health care plan
31 to select a specialist physician or other health care
32 provider who has a referral arrangement with the enrollee's
33 primary care physician or to select a new primary care
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1 physician who has a referral arrangement with the specialist
2 physician or other health care provider chosen by the
3 enrollee. If a health care plan requires an enrollee to
4 select a new physician under this subsection, the health care
5 plan must provide the enrollee with both options provided in
6 this subsection. When a participating specialist with a
7 referral arrangement is not available, the primary care
8 physician, in consultation with the enrollee, shall arrange
9 for the enrollee to have access to a qualified participating
10 health care provider, and the enrollee shall be allowed to
11 stay with his or her primary care physician. If a secondary
12 referral is necessary, the specialist physician or other
13 health care provider shall advise the primary care physician.
14 The primary care physician shall be responsible for making
15 the secondary referral. In addition, the health care plan
16 shall require the specialist physician or other health care
17 provider to provide regular updates to the enrollee's primary
18 care physician.
19 (d) When the type of specialist physician or other
20 health care provider needed to provide ongoing care for a
21 specific condition is not represented in the health care
22 plan's provider network, the primary care physician shall
23 arrange for the enrollee to have access to a qualified
24 non-participating health care provider within a reasonable
25 distance and travel time at no additional cost beyond what
26 the enrollee would otherwise pay for services received within
27 the network. The referring physician shall notify the plan
28 when a referral is made outside the network.
29 (e) The enrollee's primary care physician shall remain
30 responsible for coordinating the care of an enrollee who has
31 received a standing referral to a specialist physician or
32 other health care provider. If a secondary referral is
33 necessary, the specialist physician or other health care
34 provider shall advise the primary care physician. The
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1 primary care physician shall be responsible for making the
2 secondary referral. In addition, the health care plan shall
3 require the specialist physician or other health care
4 provider to provide regular updates to the enrollee's primary
5 care physician.
6 (f) If an enrollee's application for any referral is
7 denied, an enrollee may appeal the decision through the
8 health care plan's external independent review process in
9 accordance with subsection (f) of Section 45 of this Act.
10 (g) Nothing in this Act shall be construed to require an
11 enrollee to select a new primary care physician when no
12 referral arrangement exists between the enrollee's primary
13 care physician and the specialist selected by the enrollee
14 and when the enrollee has a long-standing relationship with
15 his or her primary care physician.
16 (h) In promulgating rules to implement this Act, the
17 Department shall define "standing referral" and "ongoing
18 course of treatment".
19 Section 45. Health care services appeals, complaints,
20 and external independent reviews.
21 (a) A health care plan shall establish and maintain an
22 appeals procedure as outlined in this Act. Compliance with
23 this Act's appeals procedures shall satisfy a health care
24 plan's obligation to provide appeal procedures under any
25 other State law or rules. All appeals of a health care plan's
26 administrative determinations and complaints regarding its
27 administrative decisions shall be handled as required under
28 Section 50.
29 (b) When an appeal concerns a decision or action by a
30 health care plan, its employees, or its subcontractors that
31 relates to (i) health care services, including, but not
32 limited to, procedures or treatments, for an enrollee with an
33 ongoing course of treatment ordered by a health care
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1 provider, the denial of which could significantly increase
2 the risk to an enrollee's health, or (ii) a treatment
3 referral, service, procedure, or other health care service,
4 the denial of which could significantly increase the risk to
5 an enrollee's health, the health care plan must allow for the
6 filing of an appeal either orally or in writing. Upon
7 submission of the appeal, a health care plan must notify the
8 party filing the appeal, as soon as possible, but in no event
9 more than 24 hours after the submission of the appeal, of all
10 information that the plan requires to evaluate the appeal.
11 The health care plan shall render a decision on the appeal
12 within 24 hours after receipt of the required information.
13 The health care plan shall notify the party filing the appeal
14 and the enrollee, enrollee's primary care physician, and any
15 health care provider who recommended the health care service
16 involved in the appeal of its decision orally followed-up by
17 a written notice of the determination.
18 (c) For all appeals related to health care services
19 including, but not limited to, procedures or treatments for
20 an enrollee and not covered by subsection (b) above, the
21 health care plan shall establish a procedure for the filing
22 of such appeals. Upon submission of an appeal under this
23 subsection, a health care plan must notify the party filing
24 an appeal, within 3 business days, of all information that
25 the plan requires to evaluate the appeal. The health care
26 plan shall render a decision on the appeal within 15 business
27 days after receipt of the required information. The health
28 care plan shall notify the party filing the appeal, the
29 enrollee, the enrollee's primary care physician, and any
30 health care provider who recommended the health care service
31 involved in the appeal orally of its decision followed-up by
32 a written notice of the determination.
33 (d) An appeal under subsection (b) or (c) may be filed
34 by the enrollee, the enrollee's designee or guardian, the
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1 enrollee's primary care physician, or the enrollee's health
2 care provider. A health care plan shall designate a clinical
3 peer to review appeals, because these appeals pertain to
4 medical or clinical matters and such an appeal must be
5 reviewed by an appropriate health care professional. No one
6 reviewing an appeal may have had any involvement in the
7 initial determination that is the subject of the appeal. The
8 written notice of determination required under subsections
9 (b) and (c) shall include (i) clear and detailed reasons for
10 the determination, (ii) the medical or clinical criteria for
11 the determination, which shall be based upon sound clinical
12 evidence and reviewed on a periodic basis, and (iii) in the
13 case of an adverse determination, the procedures for
14 requesting an external independent review under subsection
15 (f).
16 (e) If an appeal filed under subsection (b) or (c) is
17 denied for a reason including, but not limited to, the
18 service, procedure, or treatment is not viewed as medically
19 necessary, denial of specific tests or procedures, denial of
20 referral to specialist physicians or denial of
21 hospitalization requests or length of stay requests, any
22 involved party may request an external independent review
23 under subsection (f) of the adverse determination.
24 (f) External independent review.
25 (1) The party seeking an external independent
26 review shall so notify the health care plan. The health
27 care plan shall seek to resolve all external independent
28 reviews in the most expeditious manner and shall make a
29 determination and provide notice of the determination no
30 more than 24 hours after the receipt of all necessary
31 information when a delay would significantly increase the
32 risk to an enrollee's health or when extended health care
33 services for an enrollee undergoing a course of treatment
34 prescribed by a health care provider are at issue.
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1 (2) Within 30 days after the enrollee receives
2 written notice of an adverse determination, if the
3 enrollee decides to initiate an external independent
4 review, the enrollee shall send to the health care plan a
5 written request for an external independent review,
6 including any information or documentation to support the
7 enrollee's request for the covered service or claim for a
8 covered service.
9 (3) Within 30 days after the health care plan
10 receives a request for an external independent review
11 from an enrollee, the health care plan shall:
12 (A) provide a mechanism for joint selection of
13 an external independent reviewer by the enrollee,
14 the enrollee's physician or other health care
15 provider, and the health care plan; and
16 (B) forward to the independent reviewer all
17 medical records and supporting documentation
18 pertaining to the case, a summary description of the
19 applicable issues including a statement of the
20 health care plan's decision, the criteria used, and
21 the medical and clinical reasons for that decision.
22 (4) Within 5 days after receipt of all necessary
23 information, the independent reviewer shall evaluate and
24 analyze the case and render a decision that is based on
25 whether or not the health care service or claim for the
26 health care service is medically appropriate. The
27 decision by the independent reviewer is final. If the
28 external independent reviewer determines the health care
29 service to be medically appropriate, the health care plan
30 shall pay for the health care service.
31 (5) The health care plan shall be solely
32 responsible for paying the fees of the external
33 independent reviewer who is selected to perform the
34 review.
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1 (6) An external independent reviewer who acts in
2 good faith shall have immunity from any civil or criminal
3 liability or professional discipline as a result of acts
4 or omissions with respect to any external independent
5 review, unless the acts or omissions constitute wilful
6 and wanton misconduct. For purposes of any proceeding,
7 the good faith of the person participating shall be
8 presumed.
9 (7) Future contractual or employment action by the
10 health care plan regarding the patient's physician or
11 other health care provider shall not be based solely on
12 the physician's or other health care provider's
13 participation in this procedure.
14 (8) For the purposes of this Section, an external
15 independent reviewer shall:
16 (A) be a clinical peer;
17 (B) have no direct financial interest in
18 connection with the case; and
19 (C) have not been informed of the specific
20 identity of the enrollee.
21 (g) Nothing in this Section shall be construed to
22 require a health care plan to pay for a health care service
23 not covered under the enrollee's certificate of coverage or
24 policy.
25 Section 50. Administrative complaints and Departmental
26 review.
27 (a) Administrative complaint process.
28 (1) A health care plan shall accept and review
29 appeals of its determinations and complaints related to
30 administrative issues initiated by enrollees or their
31 health care providers (complainant). All appeals of a
32 health care plan's determinations and complaints related
33 to health care services shall be handled as required
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1 under Section 45. Nothing in this Act shall be construed
2 to preclude an enrollee from filing a complaint with the
3 Department or as limiting the Department's ability to
4 investigate complaints. In addition, any enrollee not
5 satisfied with the plan's resolution of any complaint may
6 appeal that final plan decision to the Department.
7 (2) When a complaint against a health care plan
8 (respondent) is received by the Department, the
9 respondent shall be notified of the complaint. The
10 Department shall, in its notification, specify the date
11 when a report is to be received from the respondent,
12 which shall be no later than 21 days after notification
13 is sent to the respondent. A failure to reply by the date
14 specified may be followed by a collect telephone call or
15 collect telegram. Repeated instances of failing to reply
16 by the date specified may result in further regulatory
17 action.
18 (3) The respondent's report shall supply adequate
19 documentation that explains all actions taken or not
20 taken and that were the basis for the complaint. The
21 report shall include documents necessary to support the
22 respondent's position and any information requested by
23 the Department. The respondent's reply shall be in
24 duplicate, but duplicate copies of supporting documents
25 shall not be required. The respondent's reply shall
26 include the name, telephone number, and address of the
27 individual assigned to investigate or process the
28 complaint. The Department shall respect the
29 confidentiality of medical reports and other documents
30 that by law are confidential. Any other information
31 furnished by a respondent shall be marked "confidential"
32 if the respondent does not wish it to be released to the
33 complainant.
34 (b) Departmental review. The Department shall review
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1 the plan decision to determine whether it is consistent with
2 the plan and Illinois law and rules. Upon receipt of the
3 respondent's report, the Department shall evaluate the
4 material submitted and:
5 (1) advise the complainant of the action taken and
6 disposition of the complaint;
7 (2) pursue further investigation with the
8 respondent or complainant; or
9 (3) refer the investigation report to the
10 appropriate branch within the Department for further
11 regulatory action.
12 (c) The Department of Insurance and the Department of
13 Public Health shall coordinate the complaint review and
14 investigation process. The Department of Insurance and the
15 Department of Public Health shall jointly establish rules
16 under the Illinois Administrative Procedure Act implementing
17 this complaint process.
18 Section 55. Record of complaints.
19 (a) The Department shall maintain records concerning the
20 complaints filed against health care plans. To that end, the
21 Department shall require health care plans to annually report
22 complaints made to and resolutions by health care plans in a
23 manner determined by rule. The Department shall make a
24 summary of all data collected available upon request and
25 publish the summary on the World Wide Web.
26 (b) The Department shall maintain records on the number
27 of complaints filed against each health care plan.
28 (c) The Department shall maintain records classifying
29 each complaint by whether the complaint was filed by:
30 (1) a consumer or enrollee;
31 (2) a provider; or
32 (3) any other individual.
33 (d) The Department shall maintain records classifying
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1 each complaint according to the nature of the complaint as it
2 pertains to a specific function of the health care plan. The
3 complaints shall be classified under the following
4 categories:
5 (1) denial of care or treatment;
6 (2) denial of a diagnostic procedure;
7 (3) denial of a referral request;
8 (4) sufficient choice and accessibility of health
9 care providers;
10 (5) underwriting;
11 (6) marketing and sales;
12 (7) claims and utilization review;
13 (8) member services;
14 (9) provider relations; and
15 (10) miscellaneous.
16 (e) The Department shall maintain records classifying
17 the disposition of each complaint. The disposition of the
18 complaint shall be classified in one of the following
19 categories:
20 (1) complaint referred to the health care plan and
21 no further action necessary by the Department;
22 (2) no corrective action deemed necessary by the
23 Department; or
24 (3) corrective action taken by the Department.
25 (f) No Department publication or release of information
26 shall identify any enrollee, health care provider, or
27 individual complainant.
28 Section 60. Choosing a physician.
29 (a) A health care plan may also offer other arrangements
30 under which enrollees may access health care services from
31 contracted providers without a referral or authorization from
32 their primary care physician.
33 (b) The enrollee may be required by the health care plan
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1 to select a specialist physician or other health care
2 provider who has a referral arrangement with the enrollee's
3 primary care physician or to select a new primary care
4 physician who has a referral arrangement with the specialist
5 physician or other health care provider chosen by the
6 enrollee. If a health care plan requires an enrollee to
7 select a new physician under this subsection, the health care
8 plan must provide the enrollee with both options provided in
9 this subsection.
10 (c) The Director of Insurance and the Department of
11 Public Health each may promulgate rules to ensure appropriate
12 access to and quality of care for enrollees in any plan that
13 allows enrollees to access health care services from
14 contractual providers without a referral or authorization
15 from the primary care physician. The rules may include, but
16 shall not be limited to, a system for the retrieval and
17 compilation of enrollees' medical records.
18 Section 65. Emergency services prior to stabilization.
19 (a) A health care plan that provides or that is required
20 by law to provide coverage for emergency services shall
21 provide coverage such that payment under this coverage is not
22 dependent upon whether the services are performed by a plan
23 or non-plan health care provider and without regard to prior
24 authorization. This coverage shall be at the same benefit
25 level as if the services or treatment had been rendered by
26 the health care plan physician licensed to practice medicine
27 in all its branches or health care provider.
28 (b) Prior authorization or approval by the plan shall
29 not be required for emergency services.
30 (c) Coverage and payment shall only be retrospectively
31 denied under the following circumstances:
32 (1) upon reasonable determination that the
33 emergency services claimed were never performed;
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1 (2) upon timely determination that the emergency
2 evaluation and treatment were rendered to an enrollee who
3 sought emergency services and whose circumstance did not
4 meet the definition of emergency medical condition;
5 (3) upon determination that the patient receiving
6 such services was not an enrollee of the health care
7 plan; or
8 (4) upon material misrepresentation by the enrollee
9 or health care provider; "material" means a fact or
10 situation that is not merely technical in nature and
11 results or could result in a substantial change in the
12 situation.
13 (d) When an enrollee presents to a hospital seeking
14 emergency services, the determination as to whether the need
15 for those services exists shall be made for purposes of
16 treatment by a physician licensed to practice medicine in
17 all its branches or, to the extent permitted by applicable
18 law, by other appropriately licensed personnel under the
19 supervision of or in collaboration with a physician licensed
20 to practice medicine in all its branches. The physician or
21 other appropriate personnel shall indicate in the patient's
22 chart the results of the emergency medical screening
23 examination.
24 (e) The appropriate use of the 911 emergency telephone
25 system or its local equivalent shall not be discouraged or
26 penalized by the health care plan when an emergency medical
27 condition exists. This provision shall not imply that the use
28 of 911 or its local equivalent is a factor in determining the
29 existence of an emergency medical condition.
30 (f) The medical director's or his or her designee's
31 determination of whether the enrollee meets the standard of
32 an emergency medical condition shall be based solely upon the
33 presenting symptoms documented in the medical record at the
34 time care was sought. Only a clinical peer may make an
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1 adverse determination.
2 (g) Nothing in this Section shall prohibit the
3 imposition of deductibles, copayments, and co-insurance.
4 Nothing in this Section alters the prohibition on billing
5 enrollees contained in the Health Maintenance Organization
6 Act.
7 Section 70. Post-stabilization medical services.
8 (a) If prior authorization for covered post-stabilization
9 services is required by the health care plan, the plan shall
10 provide access 24 hours a day, 7 days a week to persons
11 designated by the plan to make such determinations, provided
12 that any determination made under this Section must be made
13 by a health care professional. The review shall be resolved
14 in accordance with the provisions of Section 85 and the time
15 requirements of this Section.
16 (b) The treating physician licensed to practice medicine
17 in all its branches or health care provider shall contact
18 the health care plan or delegated health care provider as
19 designated on the enrollee's health insurance card to obtain
20 authorization, denial, or arrangements for an alternate plan
21 of treatment or transfer of the enrollee.
22 (c) The treating physician licensed to practice
23 medicine in all its branches or health care provider shall
24 document in the enrollee's medical record the enrollee's
25 presenting symptoms; emergency medical condition; and time,
26 phone number dialed, and result of the communication for
27 request for authorization of post-stabilization medical
28 services. The health care plan shall provide reimbursement
29 for covered post-stabilization medical services if:
30 (1) authorization to render them is received from
31 the health care plan or its delegated health care
32 provider, or
33 (2) after 2 documented good faith efforts, the
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1 treating health care provider has attempted to contact
2 the enrollee's health care plan or its delegated health
3 care provider, as designated on the enrollee's health
4 insurance card, for prior authorization of
5 post-stabilization medical services and neither the plan
6 nor designated persons were accessible or the
7 authorization was not denied within 60 minutes of the
8 request. "Two documented good faith efforts" means the
9 health care provider has called the telephone number on
10 the enrollee's health insurance card or other available
11 number either 2 times or one time and an additional call
12 to any referral number provided. "Good faith" means
13 honesty of purpose, freedom from intention to defraud,
14 and being faithful to one's duty or obligation. For the
15 purpose of this Act, good faith shall be presumed.
16 (d) After rendering any post-stabilization medical
17 services, the treating physician licensed to practice
18 medicine in all its branches or health care provider shall
19 continue to make every reasonable effort to contact the
20 health care plan or its delegated health care provider
21 regarding authorization, denial, or arrangements for an
22 alternate plan of treatment or transfer of the enrollee until
23 the treating health care provider receives instructions from
24 the health care plan or delegated health care provider for
25 continued care or the care is transferred to another health
26 care provider or the patient is discharged.
27 (e) Payment for covered post-stabilization services may
28 be denied:
29 (1) if the treating health care provider does not
30 meet the conditions outlined in subsection (c);
31 (2) upon determination that the post-stabilization
32 services claimed were not performed;
33 (3) upon timely determination that the
34 post-stabilization services rendered were contrary to the
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1 instructions of the health care plan or its delegated
2 health care provider if contact was made between those
3 parties prior to the service being rendered;
4 (4) upon determination that the patient receiving
5 such services was not an enrollee of the health care
6 plan; or
7 (5) upon material misrepresentation by the enrollee
8 or health care provider; "material" means a fact or
9 situation that is not merely technical in nature and
10 results or could result in a substantial change in the
11 situation.
12 (f) Nothing in this Section prohibits a health care plan
13 from delegating tasks associated with the responsibilities
14 enumerated in this Section to the health care plan's
15 contracted health care providers or another entity. Only a
16 clinical peer may make an adverse determination. However,
17 the ultimate responsibility for coverage and payment
18 decisions may not be delegated.
19 (g) Coverage and payment for post-stabilization medical
20 services for which prior authorization or deemed approval is
21 received shall not be retrospectively denied.
22 (h) Nothing in this Section shall prohibit the
23 imposition of deductibles, copayments, and co-insurance.
24 Nothing in this Section alters the prohibition on billing
25 enrollees contained in the Health Maintenance Organization
26 Act.
27 Section 72. Pharmacy providers.
28 (a) Before entering into an agreement with pharmacy
29 providers, a health care plan must establish terms and
30 conditions that must be met by pharmacy providers desiring to
31 contract with the health care plan. The terms and conditions
32 shall not discriminate against a pharmacy provider. A health
33 care plan may not refuse to contract with a pharmacy provider
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1 that meets the terms and conditions established by the health
2 care plan. If a pharmacy provider rejects the terms and
3 conditions established, the health care plan may offer other
4 terms and conditions necessary to comply with network
5 adequacy requirements.
6 (b) A health care plan shall apply the same co-insurance,
7 copayment, and deductible factors to all drug prescriptions
8 filled by a pharmacy provider that participates in the health
9 care plan's network. Nothing in this subsection, however,
10 prohibits a health care plan from applying different
11 co-insurance, copayment, and deductible factors between brand
12 name drugs and generic drugs when a generic equivalent exists
13 for the brand name drug.
14 (c) A health care plan may not set a limit on the
15 quantity of drugs that an enrollee may obtain at one time
16 with a prescription unless the limit is applied uniformly to
17 all pharmacy providers in the health care plan's network.
18 Section 75. Consumer advisory committee.
19 (a) A health care plan shall establish a consumer
20 advisory committee. The consumer advisory committee shall
21 have the authority to identify and review consumer concerns
22 and make advisory recommendations to the health care plan.
23 The health care plan may also make requests of the consumer
24 advisory committee to provide feedback to proposed changes in
25 plan policies and procedures which will affect enrollees.
26 However, the consumer advisory committee shall not have the
27 authority to hear or resolve specific complaints or
28 grievances, but instead shall refer such complaints or
29 grievances to the health care plan's grievance committee.
30 (b) The health care plan shall randomly select 8
31 enrollees meeting the requirements of this Section to serve
32 on the consumer advisory committee. The health care plan must
33 continue to randomly select enrollees until 8 enrollees have
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1 agreed to serve on the consumer advisory committee. Upon
2 initial formation of the consumer advisory committee, the
3 health care plan shall appoint 4 enrollees to a 2 year term
4 and 4 enrollees to a one year term. Thereafter, as an
5 enrollee's term expires, the health care plan shall
6 re-appoint or appoint an enrollee to serve on the consumer
7 advisory committee for a 2 year term. Members of the consumer
8 advisory committee shall by majority vote elect a member of
9 the committee to serve as chair of the committee.
10 (c) An enrollee may not serve on the consumer advisory
11 committee if during the 2 years preceding service the
12 enrollee:
13 (1) has been an employee, officer, or director of
14 the plan, an affiliate of the plan, or a provider or
15 affiliate of a provider that furnishes health care
16 services to the plan or affiliate of the plan; or
17 (2) is a relative of a person specified in item
18 (1).
19 (d) A health care plan's consumer advisory committee
20 shall meet not less than quarterly.
21 (e) All meetings shall be held within the State of
22 Illinois. The costs of the meetings shall be borne by the
23 health care plan.
24 Section 80. Quality assessment program.
25 (a) A health care plan shall develop and implement a
26 quality assessment and improvement strategy designed to
27 identify and evaluate accessibility, continuity, and quality
28 of care. The health care plan shall have:
29 (1) an ongoing, written, internal quality
30 assessment program;
31 (2) specific written guidelines for monitoring and
32 evaluating the quality and appropriateness of care and
33 services provided to enrollees requiring the health care
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1 plan to assess:
2 (A) the accessibility to health care
3 providers;
4 (B) appropriateness of utilization;
5 (C) concerns identified by the health care
6 plan's medical or administrative staff and
7 enrollees; and
8 (D) other aspects of care and service directly
9 related to the improvement of quality of care;
10 (3) a procedure for remedial action to correct
11 quality problems that have been verified in accordance
12 with the written plan's methodology and criteria,
13 including written procedures for taking appropriate
14 corrective action;
15 (4) follow-up measures implemented to evaluate the
16 effectiveness of the action plan.
17 (b) The health care plan shall establish a committee
18 that oversees the quality assessment and improvement strategy
19 which includes physician and enrollee participation.
20 (c) Reports on quality assessment and improvement
21 activities shall be made to the governing body of the health
22 care plan not less than quarterly.
23 (d) The health care plan shall make available its
24 written description of the quality assessment program to the
25 Department of Public Health.
26 (e) With the exception of subsection (d), the Department
27 of Public Health shall accept evidence of accreditation with
28 regard to the health care network quality management and
29 performance improvement standards of:
30 (1) the National Commission on Quality Assurance
31 (NCQA);
32 (2) the American Accreditation Healthcare
33 Commission (URAC);
34 (3) the Joint Commission on Accreditation of
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1 Healthcare Organizations (JCAHO); or
2 (4) any other entity that the Director of Public
3 Health deems has substantially similar or more stringent
4 standards than provided for in this Section.
5 (f) If the Department of Public Health determines that a
6 health care plan is not in compliance with the terms of this
7 Section, it shall certify the finding to the Department of
8 Insurance. The Department of Insurance shall subject a health
9 care plan to penalties, as provided in this Act, for such
10 non-compliance.
11 Section 85. Utilization review program registration.
12 (a) No person may conduct a utilization review program
13 in this State unless once every 2 years the person registers
14 the utilization review program with the Department and
15 certifies compliance with the Health Utilization Management
16 Standards of the American Accreditation Healthcare Commission
17 (URAC) sufficient to achieve American Accreditation
18 Healthcare Commission (URAC) accreditation or submits
19 evidence of accreditation by the American Accreditation
20 Healthcare Commission (URAC) for its Health Utilization
21 Management Standards. Nothing in this Act shall be construed
22 to require a health care plan or its subcontractors to become
23 American Accreditation Healthcare Commission (URAC)
24 accredited.
25 (b) In addition, the Director of the Department, in
26 consultation with the Director of the Department of Public
27 Health, may certify alternative utilization review standards
28 of national accreditation organizations or entities in order
29 for plans to comply with this Section. Any alternative
30 utilization review standards shall meet or exceed those
31 standards required under subsection (a).
32 (c) The provisions of this Section do not apply to:
33 (1) persons providing utilization review program
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1 services only to the federal government;
2 (2) self-insured health plans under the federal
3 Employee Retirement Income Security Act of 1974, however,
4 this Section does apply to persons conducting a
5 utilization review program on behalf of these health
6 plans;
7 (3) hospitals and medical groups performing
8 utilization review activities for internal purposes
9 unless the utilization review program is conducted for
10 another person.
11 Nothing in this Act prohibits a health care plan or other
12 entity from contractually requiring an entity designated in
13 item (3) of this subsection to adhere to the utilization
14 review program requirements of this Act.
15 (d) This registration shall include submission of all of
16 the following information regarding utilization review
17 program activities:
18 (1) The name, address, and telephone number of the
19 utilization review programs.
20 (2) The organization and governing structure of the
21 utilization review programs.
22 (3) The number of lives for which utilization
23 review is conducted by each utilization review program.
24 (4) Hours of operation of each utilization review
25 program.
26 (5) Description of the grievance process for each
27 utilization review program.
28 (6) Number of covered lives for which utilization
29 review was conducted for the previous calendar year for
30 each utilization review program.
31 (7) Written policies and procedures for protecting
32 confidential information according to applicable State
33 and federal laws for each utilization review program.
34 (e) (1) 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 (A) kept confidential in accordance with applicable
4 State and federal laws; and
5 (B) 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 Summary data shall not be considered confidential if it
9 does not provide information to allow identification of
10 individual patients or health care providers.
11 (2) Only a health care professional may make
12 determinations regarding the medical necessity of health
13 care services during the course of utilization review.
14 (3) When making retrospective reviews, utilization
15 review programs shall base reviews solely on the medical
16 information available to the attending physician or
17 ordering provider at the time the health care services
18 were provided.
19 (4) When making prospective, concurrent, and
20 retrospective determinations, utilization review programs
21 shall collect only information that is necessary to make
22 the determination and shall not routinely require health
23 care providers to numerically code diagnoses or
24 procedures to be considered for certification, unless
25 required under State or federal Medicare or Medicaid
26 rules or regulations, but may request such code if
27 available, or routinely request copies of medical records
28 of all enrollees reviewed. During prospective or
29 concurrent review, copies of medical records shall only
30 be required when necessary to verify that the health care
31 services subject to review are medically necessary. In
32 these cases, only the necessary or relevant sections of
33 the medical record shall be required.
34 (f) If the Department finds that a utilization review
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1 program is not in compliance with this Section, the
2 Department shall issue a corrective action plan and allow a
3 reasonable amount of time for compliance with the plan. If
4 the utilization review program does not come into compliance,
5 the Department may issue a cease and desist order. Before
6 issuing a cease and desist order under this Section, the
7 Department shall provide the utilization review program with
8 a written notice of the reasons for the order and allow a
9 reasonable amount of time to supply additional information
10 demonstrating compliance with requirements of this Section
11 and to request a hearing. The hearing notice shall be sent
12 by certified mail, return receipt requested, and the hearing
13 shall be conducted in accordance with the Illinois
14 Administrative Procedure Act.
15 (g) A utilization review program subject to a corrective
16 action may continue to conduct business until a final
17 decision has been issued by the Department.
18 (h) Any adverse determination made by a health care plan
19 or its subcontractors may be appealed in accordance with
20 subsection (f) of Section 45.
21 (i) The Director may by rule establish a registration
22 fee for each person conducting a utilization review program.
23 All fees paid to and collected by the Director under this
24 Section shall be deposited into the Insurance Producer
25 Administration Fund.
26 Section 90. Office of Consumer Health Insurance.
27 (a) The Director of Insurance shall establish the Office
28 of Consumer Health Insurance within the Department of
29 Insurance to provide assistance and information to all health
30 care consumers within the State. Within the appropriation
31 allocated, the Office shall provide information and
32 assistance to all health care consumers by:
33 (1) assisting consumers in understanding health
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1 insurance marketing materials and the coverage provisions
2 of individual plans;
3 (2) educating enrollees about their rights within
4 individual plans;
5 (3) assisting enrollees with the process of filing
6 formal grievances and appeals;
7 (4) establishing and operating a toll-free "800"
8 telephone number line to handle consumer inquiries;
9 (5) making related information available in
10 languages other than English that are spoken as a primary
11 language by a significant portion of the State's
12 population, as determined by the Department;
13 (6) analyzing, commenting on, monitoring, and
14 making publicly available reports on the development and
15 implementation of federal, State, and local laws,
16 regulations, and other governmental policies and actions
17 that pertain to the adequacy of health care plans,
18 facilities, and services in the State;
19 (7) filing an annual report with the Governor, the
20 Director, and the General Assembly, which shall contain
21 recommendations for improvement of the regulation of
22 health insurance plans, including recommendations on
23 improving health care consumer assistance and patterns,
24 abuses, and progress that it has identified from its
25 interaction with health care consumers; and
26 (8) performing all duties assigned to the Office by
27 the Director.
28 (b) The report required under subsection (a)(7) shall be
29 filed by January 31, 2001 and each January 31 thereafter.
30 (c) Nothing in this Section shall be interpreted to
31 authorize access to or disclosure of individual patient or
32 health care professional or provider records.
33 Section 95. Prohibited activity. No health care plan or
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1 its subcontractors by contract, written policy, or procedure
2 shall contain any clause attempting to transfer or
3 transferring to a health care provider by indemnification,
4 hold harmless, or contribution requirements concerning any
5 liability relating to activities, actions, or omissions of
6 the health care plan or its officers, employees, or agents.
7 Nothing in this Section shall relieve any person or health
8 care provider from liability for his, her, or its own
9 negligence in the performance of his, her, or its duties
10 arising from treatment of a patient. The Illinois General
11 Assembly finds it to be against public policy for a person to
12 transfer liability in such a manner.
13 Section 100. Prohibition of waiver of rights. No health
14 care plan or contract shall contain any provision, policy, or
15 procedure that limits, restricts, or waives any of the rights
16 set forth in this Act. Any such policy or procedure shall be
17 void and unenforceable.
18 Section 105. Administration and enforcement. The
19 Director of Insurance may adopt rules necessary to implement
20 the Department's responsibilities under this Act.
21 To enforce the provisions of this Act, the Director may
22 issue a cease and desist order or require a health care plan
23 to submit a plan of correction for violations of this Act, or
24 both. Subject to the provisions of the Illinois
25 Administrative Procedure Act, the Director may, pursuant to
26 Section 403A of the Illinois Insurance Code, impose upon a
27 health care plan an administrative fine not to exceed
28 $250,000 for failure to submit a requested plan of
29 correction, failure to comply with its plan of correction, or
30 repeated violations of the Act.
31 Any person who believes that his or her health care plan
32 is in violation of the provisions of this Act may file a
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1 complaint with the Department. The Department shall review
2 all complaints received and investigate all of those
3 complaints that it deems to state a potential violation. The
4 Department shall establish rules to fairly, efficiently, and
5 timely review and investigate complaints. Health care plans
6 found to be in violation of this Act shall be penalized in
7 accordance with this Section.
8 Section 110. Applicability and scope. This Act applies
9 to policies and contracts amended, delivered, issued, or
10 renewed on or after the effective date of this Act. This Act
11 does not diminish a health care plan's duties and
12 responsibilities under other federal or State law or rules
13 promulgated thereunder.
14 Section 115. Effect on benefits under Workers'
15 Compensation Act and Workers' Occupational Diseases Act.
16 Nothing in this Act shall be construed to expand, modify, or
17 restrict the health care benefits provided to employees under
18 the Workers' Compensation Act and Workers' Occupational
19 Diseases Act.
20 Section 120. Severability. The provisions of this Act
21 are severable under Section 1.31 of the Statute on Statutes.
22 Section 200. The State Employees Group Insurance Act of
23 1971 is amended by changing Sections 3 and 10 and adding
24 Section 6.12 as follows:
25 (5 ILCS 375/3) (from Ch. 127, par. 523)
26 Sec. 3. Definitions. Unless the context otherwise
27 requires, the following words and phrases as used in this Act
28 shall have the following meanings. The Department may define
29 these and other words and phrases separately for the purpose
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1 of implementing specific programs providing benefits under
2 this Act.
3 (a) "Administrative service organization" means any
4 person, firm or corporation experienced in the handling of
5 claims which is fully qualified, financially sound and
6 capable of meeting the service requirements of a contract of
7 administration executed with the Department.
8 (b) "Annuitant" means (1) an employee who retires, or
9 has retired, on or after January 1, 1966 on an immediate
10 annuity under the provisions of Articles 2, 14, 15 (including
11 an employee who has retired under the optional retirement
12 program established under Section 15-158.2), paragraphs (2),
13 (3), or (5) of Section 16-106, or Article 18 of the Illinois
14 Pension Code; (2) any person who was receiving group
15 insurance coverage under this Act as of March 31, 1978 by
16 reason of his status as an annuitant, even though the annuity
17 in relation to which such coverage was provided is a
18 proportional annuity based on less than the minimum period of
19 service required for a retirement annuity in the system
20 involved; (3) any person not otherwise covered by this Act
21 who has retired as a participating member under Article 2 of
22 the Illinois Pension Code but is ineligible for the
23 retirement annuity under Section 2-119 of the Illinois
24 Pension Code; (4) the spouse of any person who is receiving a
25 retirement annuity under Article 18 of the Illinois Pension
26 Code and who is covered under a group health insurance
27 program sponsored by a governmental employer other than the
28 State of Illinois and who has irrevocably elected to waive
29 his or her coverage under this Act and to have his or her
30 spouse considered as the "annuitant" under this Act and not
31 as a "dependent"; or (5) an employee who retires, or has
32 retired, from a qualified position, as determined according
33 to rules promulgated by the Director, under a qualified local
34 government or a qualified rehabilitation facility or a
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1 qualified domestic violence shelter or service. (For
2 definition of "retired employee", see (p) post).
3 (b-5) "New SERS annuitant" means a person who, on or
4 after January 1, 1998, becomes an annuitant, as defined in
5 subsection (b), by virtue of beginning to receive a
6 retirement annuity under Article 14 of the Illinois Pension
7 Code, and is eligible to participate in the basic program of
8 group health benefits provided for annuitants under this Act.
9 (b-6) "New SURS annuitant" means a person who, on or
10 after January 1, 1998, becomes an annuitant, as defined in
11 subsection (b), by virtue of beginning to receive a
12 retirement annuity under Article 15 of the Illinois Pension
13 Code, and is eligible to participate in the basic program of
14 group health benefits provided for annuitants under this Act.
15 (b-7) "New TRS State annuitant" means a person who, on
16 or after July 1, 1998, becomes an annuitant, as defined in
17 subsection (b), by virtue of beginning to receive a
18 retirement annuity under Article 16 of the Illinois Pension
19 Code based on service as a teacher as defined in paragraph
20 (2), (3), or (5) of Section 16-106 of that Code, and is
21 eligible to participate in the basic program of group health
22 benefits provided for annuitants under this Act.
23 (c) "Carrier" means (1) an insurance company, a
24 corporation organized under the Limited Health Service
25 Organization Act or the Voluntary Health Services Plan Act, a
26 partnership, or other nongovernmental organization, which is
27 authorized to do group life or group health insurance
28 business in Illinois, or (2) the State of Illinois as a
29 self-insurer.
30 (d) "Compensation" means salary or wages payable on a
31 regular payroll by the State Treasurer on a warrant of the
32 State Comptroller out of any State, trust or federal fund, or
33 by the Governor of the State through a disbursing officer of
34 the State out of a trust or out of federal funds, or by any
SB251 Enrolled -39- LRB9102764EGfg
1 Department out of State, trust, federal or other funds held
2 by the State Treasurer or the Department, to any person for
3 personal services currently performed, and ordinary or
4 accidental disability benefits under Articles 2, 14, 15
5 (including ordinary or accidental disability benefits under
6 the optional retirement program established under Section
7 15-158.2), paragraphs (2), (3), or (5) of Section 16-106, or
8 Article 18 of the Illinois Pension Code, for disability
9 incurred after January 1, 1966, or benefits payable under the
10 Workers' Compensation or Occupational Diseases Act or
11 benefits payable under a sick pay plan established in
12 accordance with Section 36 of the State Finance Act.
13 "Compensation" also means salary or wages paid to an employee
14 of any qualified local government or qualified rehabilitation
15 facility or a qualified domestic violence shelter or service.
16 (e) "Commission" means the State Employees Group
17 Insurance Advisory Commission authorized by this Act.
18 Commencing July 1, 1984, "Commission" as used in this Act
19 means the Illinois Economic and Fiscal Commission as
20 established by the Legislative Commission Reorganization Act
21 of 1984.
22 (f) "Contributory", when referred to as contributory
23 coverage, shall mean optional coverages or benefits elected
24 by the member toward the cost of which such member makes
25 contribution, or which are funded in whole or in part through
26 the acceptance of a reduction in earnings or the foregoing of
27 an increase in earnings by an employee, as distinguished from
28 noncontributory coverage or benefits which are paid entirely
29 by the State of Illinois without reduction of the member's
30 salary.
31 (g) "Department" means any department, institution,
32 board, commission, officer, court or any agency of the State
33 government receiving appropriations and having power to
34 certify payrolls to the Comptroller authorizing payments of
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1 salary and wages against such appropriations as are made by
2 the General Assembly from any State fund, or against trust
3 funds held by the State Treasurer and includes boards of
4 trustees of the retirement systems created by Articles 2, 14,
5 15, 16 and 18 of the Illinois Pension Code. "Department"
6 also includes the Illinois Comprehensive Health Insurance
7 Board, the Board of Examiners established under the Illinois
8 Public Accounting Act, and the Illinois Rural Bond Bank.
9 (h) "Dependent", when the term is used in the context of
10 the health and life plan, means a member's spouse and any
11 unmarried child (1) from birth to age 19 including an adopted
12 child, a child who lives with the member from the time of the
13 filing of a petition for adoption until entry of an order of
14 adoption, a stepchild or recognized child who lives with the
15 member in a parent-child relationship, or a child who lives
16 with the member if such member is a court appointed guardian
17 of the child, or (2) age 19 to 23 enrolled as a full-time
18 student in any accredited school, financially dependent upon
19 the member, and eligible as a dependent for Illinois State
20 income tax purposes, or (3) age 19 or over who is mentally or
21 physically handicapped as defined in the Illinois Insurance
22 Code. For the health plan only, the term "dependent" also
23 includes any person enrolled prior to the effective date of
24 this Section who is dependent upon the member to the extent
25 that the member may claim such person as a dependent for
26 Illinois State income tax deduction purposes; no other such
27 person may be enrolled.
28 (i) "Director" means the Director of the Illinois
29 Department of Central Management Services.
30 (j) "Eligibility period" means the period of time a
31 member has to elect enrollment in programs or to select
32 benefits without regard to age, sex or health.
33 (k) "Employee" means and includes each officer or
34 employee in the service of a department who (1) receives his
SB251 Enrolled -41- LRB9102764EGfg
1 compensation for service rendered to the department on a
2 warrant issued pursuant to a payroll certified by a
3 department or on a warrant or check issued and drawn by a
4 department upon a trust, federal or other fund or on a
5 warrant issued pursuant to a payroll certified by an elected
6 or duly appointed officer of the State or who receives
7 payment of the performance of personal services on a warrant
8 issued pursuant to a payroll certified by a Department and
9 drawn by the Comptroller upon the State Treasurer against
10 appropriations made by the General Assembly from any fund or
11 against trust funds held by the State Treasurer, and (2) is
12 employed full-time or part-time in a position normally
13 requiring actual performance of duty during not less than 1/2
14 of a normal work period, as established by the Director in
15 cooperation with each department, except that persons elected
16 by popular vote will be considered employees during the
17 entire term for which they are elected regardless of hours
18 devoted to the service of the State, and (3) except that
19 "employee" does not include any person who is not eligible by
20 reason of such person's employment to participate in one of
21 the State retirement systems under Articles 2, 14, 15 (either
22 the regular Article 15 system or the optional retirement
23 program established under Section 15-158.2) or 18, or under
24 paragraph (2), (3), or (5) of Section 16-106, of the Illinois
25 Pension Code, but such term does include persons who are
26 employed during the 6 month qualifying period under Article
27 14 of the Illinois Pension Code. Such term also includes any
28 person who (1) after January 1, 1966, is receiving ordinary
29 or accidental disability benefits under Articles 2, 14, 15
30 (including ordinary or accidental disability benefits under
31 the optional retirement program established under Section
32 15-158.2), paragraphs (2), (3), or (5) of Section 16-106, or
33 Article 18 of the Illinois Pension Code, for disability
34 incurred after January 1, 1966, (2) receives total permanent
SB251 Enrolled -42- LRB9102764EGfg
1 or total temporary disability under the Workers' Compensation
2 Act or Occupational Disease Act as a result of injuries
3 sustained or illness contracted in the course of employment
4 with the State of Illinois, or (3) is not otherwise covered
5 under this Act and has retired as a participating member
6 under Article 2 of the Illinois Pension Code but is
7 ineligible for the retirement annuity under Section 2-119 of
8 the Illinois Pension Code. However, a person who satisfies
9 the criteria of the foregoing definition of "employee" except
10 that such person is made ineligible to participate in the
11 State Universities Retirement System by clause (4) of
12 subsection (a) of Section 15-107 of the Illinois Pension Code
13 is also an "employee" for the purposes of this Act.
14 "Employee" also includes any person receiving or eligible for
15 benefits under a sick pay plan established in accordance with
16 Section 36 of the State Finance Act. "Employee" also includes
17 each officer or employee in the service of a qualified local
18 government, including persons appointed as trustees of
19 sanitary districts regardless of hours devoted to the service
20 of the sanitary district, and each employee in the service of
21 a qualified rehabilitation facility and each full-time
22 employee in the service of a qualified domestic violence
23 shelter or service, as determined according to rules
24 promulgated by the Director.
25 (l) "Member" means an employee, annuitant, retired
26 employee or survivor.
27 (m) "Optional coverages or benefits" means those
28 coverages or benefits available to the member on his or her
29 voluntary election, and at his or her own expense.
30 (n) "Program" means the group life insurance, health
31 benefits and other employee benefits designed and contracted
32 for by the Director under this Act.
33 (o) "Health plan" means a self-insured health insurance
34 program offered by the State of Illinois for the purposes of
SB251 Enrolled -43- LRB9102764EGfg
1 benefiting employees by means of providing, among others,
2 wellness programs, utilization reviews, second opinions and
3 medical fee reviews, as well as for paying for hospital and
4 medical care up to the maximum coverage provided by the plan,
5 to its members and their dependents.
6 (p) "Retired employee" means any person who would be an
7 annuitant as that term is defined herein but for the fact
8 that such person retired prior to January 1, 1966. Such term
9 also includes any person formerly employed by the University
10 of Illinois in the Cooperative Extension Service who would be
11 an annuitant but for the fact that such person was made
12 ineligible to participate in the State Universities
13 Retirement System by clause (4) of subsection (a) of Section
14 15-107 of the Illinois Pension Code.
15 (p-6) "New SURS retired employee" means a person who, on
16 or after January 1, 1998, becomes a retired employee, as
17 defined in subsection (p), by virtue of being a person
18 formerly employed by the University of Illinois in the
19 Cooperative Extension Service who would be an annuitant but
20 for the fact that he or she was made ineligible to
21 participate in the State Universities Retirement System by
22 clause (4) of subsection (a) of Section 15-107 of the
23 Illinois Pension Code, and who is eligible to participate in
24 the basic program of group health benefits provided for
25 retired employees under this Act.
26 (q) "Survivor" means a person receiving an annuity as a
27 survivor of an employee or of an annuitant. "Survivor" also
28 includes: (1) the surviving dependent of a person who
29 satisfies the definition of "employee" except that such
30 person is made ineligible to participate in the State
31 Universities Retirement System by clause (4) of subsection
32 (a) of Section 15-107 of the Illinois Pension Code; and (2)
33 the surviving dependent of any person formerly employed by
34 the University of Illinois in the Cooperative Extension
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1 Service who would be an annuitant except for the fact that
2 such person was made ineligible to participate in the State
3 Universities Retirement System by clause (4) of subsection
4 (a) of Section 15-107 of the Illinois Pension Code.
5 (q-5) "New SERS survivor" means a survivor, as defined
6 in subsection (q), whose annuity is paid under Article 14 of
7 the Illinois Pension Code and is based on the death of (i) an
8 employee whose death occurs on or after January 1, 1998, or
9 (ii) a new SERS annuitant as defined in subsection (b-5).
10 (q-6) "New SURS survivor" means a survivor, as defined
11 in subsection (q), whose annuity is paid under Article 15 of
12 the Illinois Pension Code and is based on the death of (i) an
13 employee whose death occurs on or after January 1, 1998, (ii)
14 a new SURS annuitant as defined in subsection (b-6), or (iii)
15 a new SURS retired employee as defined in subsection (p-6).
16 (q-7) "New TRS State survivor" means a survivor, as
17 defined in subsection (q), whose annuity is paid under
18 Article 16 of the Illinois Pension Code and is based on the
19 death of (i) an employee who is a teacher as defined in
20 paragraph (2), (3), or (5) of Section 16-106 of that Code and
21 whose death occurs on or after July 1, 1998, or (ii) a new
22 TRS State annuitant as defined in subsection (b-7).
23 (r) "Medical services" means the services provided
24 within the scope of their licenses by practitioners in all
25 categories licensed under the Medical Practice Act of 1987.
26 (s) "Unit of local government" means any county,
27 municipality, township, school district, special district or
28 other unit, designated as a unit of local government by law,
29 which exercises limited governmental powers or powers in
30 respect to limited governmental subjects, any not-for-profit
31 association with a membership that primarily includes
32 townships and township officials, that has duties that
33 include provision of research service, dissemination of
34 information, and other acts for the purpose of improving
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1 township government, and that is funded wholly or partly in
2 accordance with Section 85-15 of the Township Code; any
3 not-for-profit corporation or association, with a membership
4 consisting primarily of municipalities, that operates its own
5 utility system, and provides research, training,
6 dissemination of information, or other acts to promote
7 cooperation between and among municipalities that provide
8 utility services and for the advancement of the goals and
9 purposes of its membership; the Southern Illinois Collegiate
10 Common Market, which is a consortium of higher education
11 institutions in Southern Illinois; and the Illinois
12 Association of Park Districts. "Qualified local government"
13 means a unit of local government approved by the Director and
14 participating in a program created under subsection (i) of
15 Section 10 of this Act.
16 (t) "Qualified rehabilitation facility" means any
17 not-for-profit organization that is accredited by the
18 Commission on Accreditation of Rehabilitation Facilities or
19 certified by the Department of Human Services (as successor
20 to the Department of Mental Health and Developmental
21 Disabilities) to provide services to persons with
22 disabilities and which receives funds from the State of
23 Illinois for providing those services, approved by the
24 Director and participating in a program created under
25 subsection (j) of Section 10 of this Act.
26 (u) "Qualified domestic violence shelter or service"
27 means any Illinois domestic violence shelter or service and
28 its administrative offices funded by the Department of Human
29 Services (as successor to the Illinois Department of Public
30 Aid), approved by the Director and participating in a program
31 created under subsection (k) of Section 10.
32 (v) "TRS benefit recipient" means a person who:
33 (1) is not a "member" as defined in this Section;
34 and
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1 (2) is receiving a monthly benefit or retirement
2 annuity under Article 16 of the Illinois Pension Code;
3 and
4 (3) either (i) has at least 8 years of creditable
5 service under Article 16 of the Illinois Pension Code, or
6 (ii) was enrolled in the health insurance program offered
7 under that Article on January 1, 1996, or (iii) is the
8 survivor of a benefit recipient who had at least 8 years
9 of creditable service under Article 16 of the Illinois
10 Pension Code or was enrolled in the health insurance
11 program offered under that Article on the effective date
12 of this amendatory Act of 1995, or (iv) is a recipient or
13 survivor of a recipient of a disability benefit under
14 Article 16 of the Illinois Pension Code.
15 (w) "TRS dependent beneficiary" means a person who:
16 (1) is not a "member" or "dependent" as defined in
17 this Section; and
18 (2) is a TRS benefit recipient's: (A) spouse, (B)
19 dependent parent who is receiving at least half of his or
20 her support from the TRS benefit recipient, or (C)
21 unmarried natural or adopted child who is (i) under age
22 19, or (ii) enrolled as a full-time student in an
23 accredited school, financially dependent upon the TRS
24 benefit recipient, eligible as a dependent for Illinois
25 State income tax purposes, and either is under age 24 or
26 was, on January 1, 1996, participating as a dependent
27 beneficiary in the health insurance program offered under
28 Article 16 of the Illinois Pension Code, or (iii) age 19
29 or over who is mentally or physically handicapped as
30 defined in the Illinois Insurance Code.
31 (x) "Military leave with pay and benefits" refers to
32 individuals in basic training for reserves, special/advanced
33 training, annual training, emergency call up, or activation
34 by the President of the United States with approved pay and
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1 benefits.
2 (y) "Military leave without pay and benefits" refers to
3 individuals who enlist for active duty in a regular component
4 of the U.S. Armed Forces or other duty not specified or
5 authorized under military leave with pay and benefits.
6 (z) "Community college benefit recipient" means a person
7 who:
8 (1) is not a "member" as defined in this Section;
9 and
10 (2) is receiving a monthly survivor's annuity or
11 retirement annuity under Article 15 of the Illinois
12 Pension Code; and
13 (3) either (i) was a full-time employee of a
14 community college district or an association of community
15 college boards created under the Public Community College
16 Act (other than an employee whose last employer under
17 Article 15 of the Illinois Pension Code was a community
18 college district subject to Article VII of the Public
19 Community College Act) and was eligible to participate in
20 a group health benefit plan as an employee during the
21 time of employment with a community college district
22 (other than a community college district subject to
23 Article VII of the Public Community College Act) or an
24 association of community college boards, or (ii) is the
25 survivor of a person described in item (i).
26 (aa) "Community college dependent beneficiary" means a
27 person who:
28 (1) is not a "member" or "dependent" as defined in
29 this Section; and
30 (2) is a community college benefit recipient's: (A)
31 spouse, (B) dependent parent who is receiving at least
32 half of his or her support from the community college
33 benefit recipient, or (C) unmarried natural or adopted
34 child who is (i) under age 19, or (ii) enrolled as a
SB251 Enrolled -48- LRB9102764EGfg
1 full-time student in an accredited school, financially
2 dependent upon the community college benefit recipient,
3 eligible as a dependent for Illinois State income tax
4 purposes and under age 23, or (iii) age 19 or over and
5 mentally or physically handicapped as defined in the
6 Illinois Insurance Code.
7 (Source: P.A. 89-21, eff. 6-21-95; 89-25, eff. 6-21-95;
8 89-76, eff. 7-1-95; 89-324, eff. 8-13-95; 89-430, eff.
9 12-15-95; 89-502, eff. 7-1-96; 89-507, eff. 7-1-97; 89-628,
10 eff. 8-9-96; 90-14, eff. 7-1-97; 90-65, eff. 7-7-97; 90-448,
11 eff. 8-16-97; 90-497, eff. 8-18-97; 90-511, eff. 8-22-97;
12 90-582, eff. 5-27-98; 90-655, eff. 7-30-98.)
13 (5 ILCS 375/6.12 new)
14 Sec. 6.12. Managed Care Reform and Patient Rights Act.
15 The program of health benefits is subject to the provisions
16 of the Managed Care Reform and Patient Rights Act, except the
17 fee for service program shall only be required to comply with
18 Section 85 and the definition of "emergency medical
19 condition" in Section 10 of the Managed Care Reform and
20 Patient Rights Act.
21 (5 ILCS 375/10) (from Ch. 127, par. 530)
22 Sec. 10. Payments by State; premiums.
23 (a) The State shall pay the cost of basic
24 non-contributory group life insurance and, subject to member
25 paid contributions set by the Department or required by this
26 Section, the basic program of group health benefits on each
27 eligible member, except a member, not otherwise covered by
28 this Act, who has retired as a participating member under
29 Article 2 of the Illinois Pension Code but is ineligible for
30 the retirement annuity under Section 2-119 of the Illinois
31 Pension Code, and part of each eligible member's and retired
32 member's premiums for health insurance coverage for enrolled
SB251 Enrolled -49- LRB9102764EGfg
1 dependents as provided by Section 9. The State shall pay the
2 cost of the basic program of group health benefits only after
3 benefits are reduced by the amount of benefits covered by
4 Medicare for all retired members and retired dependents aged
5 65 years or older who are entitled to benefits under Social
6 Security or the Railroad Retirement system or who had
7 sufficient Medicare-covered government employment except that
8 such reduction in benefits shall apply only to those retired
9 members or retired dependents who (1) first become eligible
10 for such Medicare coverage on or after July 1, 1992; or (2)
11 remain eligible for, but no longer receive Medicare coverage
12 which they had been receiving on or after July 1, 1992. The
13 Department may determine the aggregate level of the State's
14 contribution on the basis of actual cost of medical services
15 adjusted for age, sex or geographic or other demographic
16 characteristics which affect the costs of such programs.
17 The cost of participation in the basic program of group
18 health benefits for the dependent or survivor of a living or
19 deceased retired employee who was formerly employed by the
20 University of Illinois in the Cooperative Extension Service
21 and would be an annuitant but for the fact that he or she was
22 made ineligible to participate in the State Universities
23 Retirement System by clause (4) of subsection (a) of Section
24 15-107 of the Illinois Pension Code shall not be greater than
25 the cost of participation that would otherwise apply to that
26 dependent or survivor if he or she were the dependent or
27 survivor of an annuitant under the State Universities
28 Retirement System.
29 (a-1) Beginning January 1, 1998, for each person who
30 becomes a new SERS annuitant and participates in the basic
31 program of group health benefits, the State shall contribute
32 toward the cost of the annuitant's coverage under the basic
33 program of group health benefits an amount equal to 5% of
34 that cost for each full year of creditable service upon which
SB251 Enrolled -50- LRB9102764EGfg
1 the annuitant's retirement annuity is based, up to a maximum
2 of 100% for an annuitant with 20 or more years of creditable
3 service. The remainder of the cost of a new SERS annuitant's
4 coverage under the basic program of group health benefits
5 shall be the responsibility of the annuitant.
6 (a-2) Beginning January 1, 1998, for each person who
7 becomes a new SERS survivor and participates in the basic
8 program of group health benefits, the State shall contribute
9 toward the cost of the survivor's coverage under the basic
10 program of group health benefits an amount equal to 5% of
11 that cost for each full year of the deceased employee's or
12 deceased annuitant's creditable service in the State
13 Employees' Retirement System of Illinois on the date of
14 death, up to a maximum of 100% for a survivor of an employee
15 or annuitant with 20 or more years of creditable service.
16 The remainder of the cost of the new SERS survivor's coverage
17 under the basic program of group health benefits shall be the
18 responsibility of the survivor.
19 (a-3) Beginning January 1, 1998, for each person who
20 becomes a new SURS annuitant and participates in the basic
21 program of group health benefits, the State shall contribute
22 toward the cost of the annuitant's coverage under the basic
23 program of group health benefits an amount equal to 5% of
24 that cost for each full year of creditable service upon which
25 the annuitant's retirement annuity is based, up to a maximum
26 of 100% for an annuitant with 20 or more years of creditable
27 service. The remainder of the cost of a new SURS annuitant's
28 coverage under the basic program of group health benefits
29 shall be the responsibility of the annuitant.
30 (a-4) Beginning January 1, 1998, for each person who
31 becomes a new SURS retired employee and participates in the
32 basic program of group health benefits, the State shall
33 contribute toward the cost of the retired employee's coverage
34 under the basic program of group health benefits an amount
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1 equal to 5% of that cost for each full year that the retired
2 employee was an employee as defined in Section 3, up to a
3 maximum of 100% for a retired employee who was an employee
4 for 20 or more years. The remainder of the cost of a new
5 SURS retired employee's coverage under the basic program of
6 group health benefits shall be the responsibility of the
7 retired employee.
8 (a-5) Beginning January 1, 1998, for each person who
9 becomes a new SURS survivor and participates in the basic
10 program of group health benefits, the State shall contribute
11 toward the cost of the survivor's coverage under the basic
12 program of group health benefits an amount equal to 5% of
13 that cost for each full year of the deceased employee's or
14 deceased annuitant's creditable service in the State
15 Universities Retirement System on the date of death, up to a
16 maximum of 100% for a survivor of an employee or annuitant
17 with 20 or more years of creditable service. The remainder
18 of the cost of the new SURS survivor's coverage under the
19 basic program of group health benefits shall be the
20 responsibility of the survivor.
21 (a-6) Beginning July 1, 1998, for each person who
22 becomes a new TRS State annuitant and participates in the
23 basic program of group health benefits, the State shall
24 contribute toward the cost of the annuitant's coverage under
25 the basic program of group health benefits an amount equal to
26 5% of that cost for each full year of creditable service as a
27 teacher as defined in paragraph (2), (3), or (5) of Section
28 16-106 of the Illinois Pension Code upon which the
29 annuitant's retirement annuity is based, up to a maximum of
30 100% for an annuitant with 20 or more years of such
31 creditable service. The remainder of the cost of a new TRS
32 State annuitant's coverage under the basic program of group
33 health benefits shall be the responsibility of the annuitant.
34 (a-7) Beginning July 1, 1998, for each person who
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1 becomes a new TRS State survivor and participates in the
2 basic program of group health benefits, the State shall
3 contribute toward the cost of the survivor's coverage under
4 the basic program of group health benefits an amount equal to
5 5% of that cost for each full year of the deceased employee's
6 or deceased annuitant's creditable service as a teacher as
7 defined in paragraph (2), (3), or (5) of Section 16-106 of
8 the Illinois Pension Code on the date of death, up to a
9 maximum of 100% for a survivor of an employee or annuitant
10 with 20 or more years of such creditable service. The
11 remainder of the cost of the new TRS State survivor's
12 coverage under the basic program of group health benefits
13 shall be the responsibility of the survivor.
14 (a-8) A new SERS annuitant, new SERS survivor, new SURS
15 annuitant, new SURS retired employee, new SURS survivor, new
16 TRS State annuitant, or new TRS State survivor may waive or
17 terminate coverage in the program of group health benefits.
18 Any such annuitant, survivor, or retired employee who has
19 waived or terminated coverage may enroll or re-enroll in the
20 program of group health benefits only during the annual
21 benefit choice period, as determined by the Director; except
22 that in the event of termination of coverage due to
23 nonpayment of premiums, the annuitant, survivor, or retired
24 employee may not re-enroll in the program.
25 (a-9) No later than May 1 of each calendar year, the
26 Director of Central Management Services shall certify in
27 writing to the Executive Secretary of the State Employees'
28 Retirement System of Illinois the amounts of the Medicare
29 supplement health care premiums and the amounts of the health
30 care premiums for all other retirees who are not Medicare
31 eligible.
32 A separate calculation of the premiums based upon the
33 actual cost of each health care plan shall be so certified.
34 The Director of Central Management Services shall provide
SB251 Enrolled -53- LRB9102764EGfg
1 to the Executive Secretary of the State Employees' Retirement
2 System of Illinois such information, statistics, and other
3 data as he or she may require to review the premium amounts
4 certified by the Director of Central Management Services.
5 (b) State employees who become eligible for this program
6 on or after January 1, 1980 in positions normally requiring
7 actual performance of duty not less than 1/2 of a normal work
8 period but not equal to that of a normal work period, shall
9 be given the option of participating in the available
10 program. If the employee elects coverage, the State shall
11 contribute on behalf of such employee to the cost of the
12 employee's benefit and any applicable dependent supplement,
13 that sum which bears the same percentage as that percentage
14 of time the employee regularly works when compared to normal
15 work period.
16 (c) The basic non-contributory coverage from the basic
17 program of group health benefits shall be continued for each
18 employee not in pay status or on active service by reason of
19 (1) leave of absence due to illness or injury, (2) authorized
20 educational leave of absence or sabbatical leave, or (3)
21 military leave with pay and benefits. This coverage shall
22 continue until expiration of authorized leave and return to
23 active service, but not to exceed 24 months for leaves under
24 item (1) or (2). This 24-month limitation and the requirement
25 of returning to active service shall not apply to persons
26 receiving ordinary or accidental disability benefits or
27 retirement benefits through the appropriate State retirement
28 system or benefits under the Workers' Compensation or
29 Occupational Disease Act.
30 (d) The basic group life insurance coverage shall
31 continue, with full State contribution, where such person is
32 (1) absent from active service by reason of disability
33 arising from any cause other than self-inflicted, (2) on
34 authorized educational leave of absence or sabbatical leave,
SB251 Enrolled -54- LRB9102764EGfg
1 or (3) on military leave with pay and benefits.
2 (e) Where the person is in non-pay status for a period
3 in excess of 30 days or on leave of absence, other than by
4 reason of disability, educational or sabbatical leave, or
5 military leave with pay and benefits, such person may
6 continue coverage only by making personal payment equal to
7 the amount normally contributed by the State on such person's
8 behalf. Such payments and coverage may be continued: (1)
9 until such time as the person returns to a status eligible
10 for coverage at State expense, but not to exceed 24 months,
11 (2) until such person's employment or annuitant status with
12 the State is terminated, or (3) for a maximum period of 4
13 years for members on military leave with pay and benefits and
14 military leave without pay and benefits (exclusive of any
15 additional service imposed pursuant to law).
16 (f) The Department shall establish by rule the extent
17 to which other employee benefits will continue for persons in
18 non-pay status or who are not in active service.
19 (g) The State shall not pay the cost of the basic
20 non-contributory group life insurance, program of health
21 benefits and other employee benefits for members who are
22 survivors as defined by paragraphs (1) and (2) of subsection
23 (q) of Section 3 of this Act. The costs of benefits for
24 these survivors shall be paid by the survivors or by the
25 University of Illinois Cooperative Extension Service, or any
26 combination thereof. However, the State shall pay the amount
27 of the reduction in the cost of participation, if any,
28 resulting from the amendment to subsection (a) made by this
29 amendatory Act of the 91st General Assembly.
30 (h) Those persons occupying positions with any
31 department as a result of emergency appointments pursuant to
32 Section 8b.8 of the Personnel Code who are not considered
33 employees under this Act shall be given the option of
34 participating in the programs of group life insurance, health
SB251 Enrolled -55- LRB9102764EGfg
1 benefits and other employee benefits. Such persons electing
2 coverage may participate only by making payment equal to the
3 amount normally contributed by the State for similarly
4 situated employees. Such amounts shall be determined by the
5 Director. Such payments and coverage may be continued until
6 such time as the person becomes an employee pursuant to this
7 Act or such person's appointment is terminated.
8 (i) Any unit of local government within the State of
9 Illinois may apply to the Director to have its employees,
10 annuitants, and their dependents provided group health
11 coverage under this Act on a non-insured basis. To
12 participate, a unit of local government must agree to enroll
13 all of its employees, who may select coverage under either
14 the State group health insurance plan or a health maintenance
15 organization that has contracted with the State to be
16 available as a health care provider for employees as defined
17 in this Act. A unit of local government must remit the
18 entire cost of providing coverage under the State group
19 health insurance plan or, for coverage under a health
20 maintenance organization, an amount determined by the
21 Director based on an analysis of the sex, age, geographic
22 location, or other relevant demographic variables for its
23 employees, except that the unit of local government shall not
24 be required to enroll those of its employees who are covered
25 spouses or dependents under this plan or another group policy
26 or plan providing health benefits as long as (1) an
27 appropriate official from the unit of local government
28 attests that each employee not enrolled is a covered spouse
29 or dependent under this plan or another group policy or plan,
30 and (2) at least 85% of the employees are enrolled and the
31 unit of local government remits the entire cost of providing
32 coverage to those employees. Employees of a participating
33 unit of local government who are not enrolled due to coverage
34 under another group health policy or plan may enroll at a
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1 later date subject to submission of satisfactory evidence of
2 insurability and provided that no benefits shall be payable
3 for services incurred during the first 6 months of coverage
4 to the extent the services are in connection with any
5 pre-existing condition. A participating unit of local
6 government may also elect to cover its annuitants. Dependent
7 coverage shall be offered on an optional basis, with the
8 costs paid by the unit of local government, its employees, or
9 some combination of the two as determined by the unit of
10 local government. The unit of local government shall be
11 responsible for timely collection and transmission of
12 dependent premiums.
13 The Director shall annually determine monthly rates of
14 payment, subject to the following constraints:
15 (1) In the first year of coverage, the rates shall
16 be equal to the amount normally charged to State
17 employees for elected optional coverages or for enrolled
18 dependents coverages or other contributory coverages, or
19 contributed by the State for basic insurance coverages on
20 behalf of its employees, adjusted for differences between
21 State employees and employees of the local government in
22 age, sex, geographic location or other relevant
23 demographic variables, plus an amount sufficient to pay
24 for the additional administrative costs of providing
25 coverage to employees of the unit of local government and
26 their dependents.
27 (2) In subsequent years, a further adjustment shall
28 be made to reflect the actual prior years' claims
29 experience of the employees of the unit of local
30 government.
31 In the case of coverage of local government employees
32 under a health maintenance organization, the Director shall
33 annually determine for each participating unit of local
34 government the maximum monthly amount the unit may contribute
SB251 Enrolled -57- LRB9102764EGfg
1 toward that coverage, based on an analysis of (i) the age,
2 sex, geographic location, and other relevant demographic
3 variables of the unit's employees and (ii) the cost to cover
4 those employees under the State group health insurance plan.
5 The Director may similarly determine the maximum monthly
6 amount each unit of local government may contribute toward
7 coverage of its employees' dependents under a health
8 maintenance organization.
9 Monthly payments by the unit of local government or its
10 employees for group health insurance or health maintenance
11 organization coverage shall be deposited in the Local
12 Government Health Insurance Reserve Fund. The Local
13 Government Health Insurance Reserve Fund shall be a
14 continuing fund not subject to fiscal year limitations. All
15 expenditures from this fund shall be used for payments for
16 health care benefits for local government and rehabilitation
17 facility employees, annuitants, and dependents, and to
18 reimburse the Department or its administrative service
19 organization for all expenses incurred in the administration
20 of benefits. No other State funds may be used for these
21 purposes.
22 A local government employer's participation or desire to
23 participate in a program created under this subsection shall
24 not limit that employer's duty to bargain with the
25 representative of any collective bargaining unit of its
26 employees.
27 (j) Any rehabilitation facility within the State of
28 Illinois may apply to the Director to have its employees,
29 annuitants, and their dependents provided group health
30 coverage under this Act on a non-insured basis. To
31 participate, a rehabilitation facility must agree to enroll
32 all of its employees and remit the entire cost of providing
33 such coverage for its employees, except that the
34 rehabilitation facility shall not be required to enroll those
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1 of its employees who are covered spouses or dependents under
2 this plan or another group policy or plan providing health
3 benefits as long as (1) an appropriate official from the
4 rehabilitation facility attests that each employee not
5 enrolled is a covered spouse or dependent under this plan or
6 another group policy or plan, and (2) at least 85% of the
7 employees are enrolled and the rehabilitation facility remits
8 the entire cost of providing coverage to those employees.
9 Employees of a participating rehabilitation facility who are
10 not enrolled due to coverage under another group health
11 policy or plan may enroll at a later date subject to
12 submission of satisfactory evidence of insurability and
13 provided that no benefits shall be payable for services
14 incurred during the first 6 months of coverage to the extent
15 the services are in connection with any pre-existing
16 condition. A participating rehabilitation facility may also
17 elect to cover its annuitants. Dependent coverage shall be
18 offered on an optional basis, with the costs paid by the
19 rehabilitation facility, its employees, or some combination
20 of the 2 as determined by the rehabilitation facility. The
21 rehabilitation facility shall be responsible for timely
22 collection and transmission of dependent premiums.
23 The Director shall annually determine quarterly rates of
24 payment, subject to the following constraints:
25 (1) In the first year of coverage, the rates shall
26 be equal to the amount normally charged to State
27 employees for elected optional coverages or for enrolled
28 dependents coverages or other contributory coverages on
29 behalf of its employees, adjusted for differences between
30 State employees and employees of the rehabilitation
31 facility in age, sex, geographic location or other
32 relevant demographic variables, plus an amount sufficient
33 to pay for the additional administrative costs of
34 providing coverage to employees of the rehabilitation
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1 facility and their dependents.
2 (2) In subsequent years, a further adjustment shall
3 be made to reflect the actual prior years' claims
4 experience of the employees of the rehabilitation
5 facility.
6 Monthly payments by the rehabilitation facility or its
7 employees for group health insurance shall be deposited in
8 the Local Government Health Insurance Reserve Fund.
9 (k) Any domestic violence shelter or service within the
10 State of Illinois may apply to the Director to have its
11 employees, annuitants, and their dependents provided group
12 health coverage under this Act on a non-insured basis. To
13 participate, a domestic violence shelter or service must
14 agree to enroll all of its employees and pay the entire cost
15 of providing such coverage for its employees. A
16 participating domestic violence shelter may also elect to
17 cover its annuitants. Dependent coverage shall be offered on
18 an optional basis, with employees, or some combination of the
19 2 as determined by the domestic violence shelter or service.
20 The domestic violence shelter or service shall be responsible
21 for timely collection and transmission of dependent premiums.
22 The Director shall annually determine quarterly rates of
23 payment, subject to the following constraints:
24 (1) In the first year of coverage, the rates shall
25 be equal to the amount normally charged to State
26 employees for elected optional coverages or for enrolled
27 dependents coverages or other contributory coverages on
28 behalf of its employees, adjusted for differences between
29 State employees and employees of the domestic violence
30 shelter or service in age, sex, geographic location or
31 other relevant demographic variables, plus an amount
32 sufficient to pay for the additional administrative costs
33 of providing coverage to employees of the domestic
34 violence shelter or service and their dependents.
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1 (2) In subsequent years, a further adjustment shall
2 be made to reflect the actual prior years' claims
3 experience of the employees of the domestic violence
4 shelter or service.
5 (3) In no case shall the rate be less than the
6 amount normally charged to State employees or contributed
7 by the State on behalf of its employees.
8 Monthly payments by the domestic violence shelter or
9 service or its employees for group health insurance shall be
10 deposited in the Local Government Health Insurance Reserve
11 Fund.
12 (l) A public community college or entity organized
13 pursuant to the Public Community College Act may apply to the
14 Director initially to have only annuitants not covered prior
15 to July 1, 1992 by the district's health plan provided health
16 coverage under this Act on a non-insured basis. The
17 community college must execute a 2-year contract to
18 participate in the Local Government Health Plan. Those
19 annuitants enrolled initially under this contract shall have
20 no benefits payable for services incurred during the first 6
21 months of coverage to the extent the services are in
22 connection with any pre-existing condition. Any annuitant
23 who may enroll after this initial enrollment period shall be
24 subject to submission of satisfactory evidence of
25 insurability and to the pre-existing conditions limitation.
26 The Director shall annually determine monthly rates of
27 payment subject to the following constraints: for those
28 community colleges with annuitants only enrolled, first year
29 rates shall be equal to the average cost to cover claims for
30 a State member adjusted for demographics, Medicare
31 participation, and other factors; and in the second year, a
32 further adjustment of rates shall be made to reflect the
33 actual first year's claims experience of the covered
34 annuitants.
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1 (m) The Director shall adopt any rules deemed necessary
2 for implementation of this amendatory Act of 1989 (Public Act
3 86-978).
4 (Source: P.A. 89-53, eff. 7-1-95; 89-236, eff. 8-4-95;
5 89-324, eff. 8-13-95; 89-626, eff. 8-9-96; 90-65, eff.
6 7-7-97; 90-582, eff. 5-27-98; 90-655, eff. 7-30-98; revised
7 8-3-98.)
8 Section 205. The State Mandates Act is amended by adding
9 Section 8.23 as follows:
10 (30 ILCS 805/8.23 new)
11 Sec. 8.23. Exempt mandate. Notwithstanding Sections 6
12 and 8 of this Act, no reimbursement by the State is required
13 for the implementation of any mandate created by this
14 amendatory Act of the 91st General Assembly.
15 Section 210. The Counties Code is amended by adding
16 Section 5-1069.8 as follows:
17 (55 ILCS 5/5-1069.8 new)
18 Sec. 5-1069.8. Managed Care Reform and Patient Rights
19 Act. All counties, including home rule counties, are subject
20 to the provisions of the Managed Care Reform and Patient
21 Rights Act. The requirement under this Section that health
22 care benefits provided by counties comply with the Managed
23 Care Reform and Patient Rights Act is an exclusive power and
24 function of the State and is a denial and limitation of home
25 rule county powers under Article VII, Section 6, subsection
26 (h) of the Illinois Constitution.
27 Section 215. The Illinois Municipal Code is amended by
28 adding Section 10-4-2.8 as follows:
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1 (65 ILCS 5/10-4-2.8 new)
2 Sec. 10-4-2.8. Managed Care Reform and Patient Rights
3 Act. The corporate authorities of all municipalities are
4 subject to the provisions of the Managed Care Reform and
5 Patient Rights Act. The requirement under this Section that
6 health care benefits provided by municipalities comply with
7 the Managed Care Reform and Patient Rights Act is an
8 exclusive power and function of the State and is a denial and
9 limitation of home rule municipality powers under Article
10 VII, Section 6, subsection (h) of the Illinois Constitution.
11 Section 220. The Illinois Insurance Code is amended by
12 changing Section 370g and adding Sections 155.36, 370s, and
13 511.118 as follows:
14 (215 ILCS 5/155.36 new)
15 Sec. 155.36. Managed Care Reform and Patient Rights Act.
16 Insurance companies that transact the kinds of insurance
17 authorized under Class 1(b) or Class 2(a) of Section 4 of
18 this Code shall comply with Section 85 and the definition of
19 the term "emergency medical condition" in Section 10 of the
20 Managed Care Reform and Patient Rights Act.
21 (215 ILCS 5/370g) (from Ch. 73, par. 982g)
22 Sec. 370g. Definitions. As used in this Article, the
23 following definitions apply:
24 (a) "Health care services" means health care services or
25 products rendered or sold by a provider within the scope of
26 the provider's license or legal authorization. The term
27 includes, but is not limited to, hospital, medical, surgical,
28 dental, vision and pharmaceutical services or products.
29 (b) "Insurer" means an insurance company or a health
30 service corporation authorized in this State to issue
31 policies or subscriber contracts which reimburse for expenses
SB251 Enrolled -63- LRB9102764EGfg
1 of health care services.
2 (c) "Insured" means an individual entitled to
3 reimbursement for expenses of health care services under a
4 policy or subscriber contract issued or administered by an
5 insurer.
6 (d) "Provider" means an individual or entity duly
7 licensed or legally authorized to provide health care
8 services.
9 (e) "Noninstitutional provider" means any person
10 licensed under the Medical Practice Act of 1987, as now or
11 hereafter amended.
12 (f) "Beneficiary" means an individual entitled to
13 reimbursement for expenses of or the discount of provider
14 fees for health care services under a program where the
15 beneficiary has an incentive to utilize the services of a
16 provider which has entered into an agreement or arrangement
17 with an administrator.
18 (g) "Administrator" means any person, partnership or
19 corporation, other than an insurer or health maintenance
20 organization holding a certificate of authority under the
21 "Health Maintenance Organization Act", as now or hereafter
22 amended, that arranges, contracts with, or administers
23 contracts with a provider whereby beneficiaries are provided
24 an incentive to use the services of such provider.
25 (h) "Emergency medical condition" means a medical
26 condition manifesting itself by acute symptoms of sufficient
27 severity (including severe pain) such that a prudent
28 layperson, who possesses an average knowledge of health and
29 medicine, could reasonably expect the absence of immediate
30 medical attention to result in:
31 (1) placing the health of the individual (or, with
32 respect to a pregnant woman, the health of the woman or
33 her unborn child) in serious jeopardy;
34 (2) serious impairment to bodily functions; or
SB251 Enrolled -64- LRB9102764EGfg
1 (3) serious dysfunction of any bodily organ or
2 part. "Emergency" means an accidental bodily injury or
3 emergency medical condition which reasonably requires the
4 beneficiary or insured to seek immediate medical care
5 under circumstances or at locations which reasonably
6 preclude the beneficiary or insured from obtaining needed
7 medical care from a preferred provider.
8 (Source: P.A. 88-400.)
9 (215 ILCS 5/370s new)
10 Sec. 370s. Managed Care Reform and Patient Rights Act.
11 All administrators shall comply with Sections 55 and 85 of
12 the Managed Care Reform and Patient Rights Act.
13 (215 ILCS 5/511.118 new)
14 Sec. 511.118. Managed Care Reform and Patient Rights
15 Act. All administrators are subject to the provisions of
16 Sections 55 and 85 of the Managed Care Reform and Patient
17 Rights Act.
18 Section 225. The Comprehensive Health Insurance Plan Act
19 is amended by adding Section 8.6 as follows:
20 (215 ILCS 105/8.6 new)
21 Sec. 8.6. Managed Care Reform and Patient Rights Act.
22 The plan is subject to the provisions of the Managed Care
23 Reform and Patient Rights Act.
24 Section 230. The Health Care Purchasing Group Act is
25 amended by changing Sections 15 and 20 as follows:
26 (215 ILCS 123/15)
27 Sec. 15. Health care purchasing groups; membership;
28 formation.
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1 (a) An HPG may be an organization formed by 2 or more
2 employers with no more than 500 covered employees each 2,500
3 covered individuals, an HPG sponsor or a risk-bearer for
4 purposes of contracting for health insurance under this Act
5 to cover employees and dependents of HPG members. An HPG
6 shall not be prevented from supplementing health insurance
7 coverage purchased under this Act by contracting for services
8 from entities licensed and authorized in Illinois to provide
9 those services under the Dental Service Plan Act, the Limited
10 Health Service Organization Act, or Voluntary Health Services
11 Plans Act. An HPG may be a separate legal entity or simply a
12 group of 2 or more employers with no more than 500 covered
13 employees each 2,500 covered individuals aggregated under
14 this Act by an HPG sponsor or risk-bearer for insurance
15 purposes. There shall be no limit as to the number of HPGs
16 that may operate in any geographic area of the State. No
17 insurance risk may be borne or retained by the HPG. All
18 health insurance contracts issued to the HPG must be
19 delivered or issued for delivery in Illinois.
20 (b) Members of an HPG must be Illinois domiciled
21 employers, except that an employer domiciled elsewhere may
22 become a member of an Illinois HPG for the sole purpose of
23 insuring its employees whose place of employment is located
24 within this State. HPG membership may include employers
25 having no more than 500 covered employees each 2,500 covered
26 individuals.
27 (c) If an HPG is formed by any 2 or more employers with
28 no more than 500 covered employees each 2,500 covered
29 individuals, it is authorized to negotiate, solicit, market,
30 obtain proposals for, and enter into group or master health
31 insurance contracts on behalf of its members and their
32 employees and employee dependents so long as it meets all of
33 the following requirements:
34 (1) The HPG must be an organization having the
SB251 Enrolled -66- LRB9102764EGfg
1 legal capacity to contract and having its legal situs in
2 Illinois.
3 (2) The principal persons responsible for the
4 conduct of the HPG must perform their HPG related
5 functions in Illinois.
6 (3) No HPG may collect premium in its name or hold
7 or manage premium or claim fund accounts unless duly
8 licensed and qualified as a managing general agent
9 pursuant to Section 141a of the Illinois Insurance Code
10 or 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 to that employer the total cost of the insurance. Dues,
15 fees, or charges to be paid to the HPG, HPG sponsor, or
16 any other entity as a condition to purchasing the
17 insurance must be itemized. The HPG shall also disclose
18 to its members the amount of any dividends, experience
19 refunds, or other such payments it receives from the
20 risk-bearer.
21 (5) An HPG must register with the Director before
22 entering into a group or master health insurance contract
23 on behalf of its members and must renew the registration
24 annually on forms and at times prescribed by the Director
25 in rules specifying, at minimum, (i) the identity of the
26 officers and directors, trustees, or attorney-in-fact of
27 the HPG; (ii) a certification that those persons have not
28 been convicted of any felony offense involving a breach
29 of fiduciary duty or improper manipulation of accounts;
30 and (iii) the number of employer members then enrolled in
31 the HPG, together with any other information that may be
32 needed to carry out the purposes of this Act.
33 (6) At the time of initial registration and each
34 renewal thereof an HPG shall pay a fee of $100 to the
SB251 Enrolled -67- LRB9102764EGfg
1 Director.
2 (d) If an HPG is formed by an HPG sponsor or risk-bearer
3 and the HPG performs no marketing, negotiation, solicitation,
4 or proposing of insurance to HPG members, exclusive of
5 ministerial acts performed by individual employers to service
6 their own employees, then a group or master health insurance
7 contract may be issued in the name of the HPG and held by an
8 HPG sponsor, risk-bearer, or designated employer member
9 within the State. In these cases the HPG requirements
10 specified in subsection (c) shall not be applicable, however:
11 (1) the group or master health insurance contract
12 must contain a provision permitting the contract to be
13 enforced through legal action initiated by any employer
14 member or by an employee of an HPG member who has paid
15 premium for the coverage provided;
16 (2) the group or master health insurance contract
17 must be available for inspection and copying by any HPG
18 member, employee, or insured dependent at a designated
19 location within the State at all normal business hours;
20 and
21 (3) any information concerning HPG membership
22 required by rule under item (5) of subsection (c) must be
23 provided by the HPG sponsor in its registration and
24 renewal forms or by the risk-bearer in its annual
25 reports.
26 (Source: P.A. 90-337, eff. 1-1-98; 90-655, eff. 7-30-98.)
27 (215 ILCS 123/20)
28 Sec. 20. HPG sponsors. Except as provided by Sections 15
29 and 25 of this Act, only a corporation authorized by the
30 Secretary of State to transact business in Illinois may
31 sponsor one or more HPGs with no more than 100,000 10,000
32 covered individuals by negotiating, soliciting, or servicing
33 health insurance contracts for HPGs and their members. Such a
SB251 Enrolled -68- LRB9102764EGfg
1 corporation may assert and maintain authority to act as an
2 HPG sponsor by complying with all of the following
3 requirements:
4 (1) The principal officers and directors
5 responsible for the conduct of the HPG sponsor must
6 perform their HPG sponsor related functions in Illinois.
7 (2) No insurance risk may be borne or retained by
8 the HPG sponsor; all health insurance contracts issued to
9 HPGs through the HPG sponsor must be delivered in
10 Illinois.
11 (3) No HPG sponsor may collect premium in its name
12 or hold or manage premium or claim fund accounts unless
13 duly qualified and licensed as a managing general agent
14 pursuant to Section 141a of the Illinois Insurance Code
15 or as a third party administrator pursuant to Section
16 511.105 of the Illinois Insurance Code.
17 (4) If the HPG gives an offer, application, notice,
18 or proposal of insurance to an employer, it must disclose
19 the total cost of the insurance. Dues, fees, or charges
20 to be paid to the HPG, HPG sponsor, or any other entity
21 as a condition to purchasing the insurance must be
22 itemized. The HPG shall also disclose to its members the
23 amount of any dividends, experience refunds, or other
24 such payments it receives from the risk-bearer.
25 (5) An HPG sponsor must register with the Director
26 before negotiating or soliciting any group or master
27 health insurance contract for any HPG and must renew the
28 registration annually on forms and at times prescribed by
29 the Director in rules specifying, at minimum, (i) the
30 identity of the officers and directors of the HPG sponsor
31 corporation; (ii) a certification that those persons have
32 not been convicted of any felony offense involving a
33 breach of fiduciary duty or improper manipulation of
34 accounts; (iii) the number of employer members then
SB251 Enrolled -69- LRB9102764EGfg
1 enrolled in each HPG sponsored; (iv) the date on which
2 each HPG was issued a group or master health insurance
3 contract, if any; and (v) the date on which each such
4 contract, if any, was terminated.
5 (6) At the time of initial registration and each
6 renewal thereof an HPG sponsor shall pay a fee of $100 to
7 the Director.
8 (Source: P.A. 90-337, eff. 1-1-98.)
9 Section 235. The Health Maintenance Organization Act is
10 amended by changing Sections 2-2 and 6-7 and adding Section
11 5-3.6 as follows:
12 (215 ILCS 125/2-2) (from Ch. 111 1/2, par. 1404)
13 Sec. 2-2. Determination by Director; Health Maintenance
14 Advisory Board.
15 (a) Upon receipt of an application for issuance of a
16 certificate of authority, the Director shall transmit copies
17 of such application and accompanying documents to the
18 Director of the Illinois Department of Public Health. The
19 Director of the Department of Public Health shall then
20 determine whether the applicant for certificate of authority,
21 with respect to health care services to be furnished: (1) has
22 demonstrated the willingness and potential ability to assure
23 that such health care service will be provided in a manner to
24 insure both availability and accessibility of adequate
25 personnel and facilities and in a manner enhancing
26 availability, accessibility, and continuity of service; and
27 (2) has arrangements, established in accordance with
28 regulations promulgated by the Department of Public Health
29 for an ongoing quality of health care assurance program
30 concerning health care processes and outcomes. Upon
31 investigation, the Director of the Department of Public
32 Health shall certify to the Director whether the proposed
SB251 Enrolled -70- LRB9102764EGfg
1 Health Maintenance Organization meets the requirements of
2 this subsection (a). If the Director of the Department of
3 Public Health certifies that the Health Maintenance
4 Organization does not meet such requirements, he shall
5 specify in what respect it is deficient.
6 There is created in the Department of Public Health a
7 Health Maintenance Advisory Board composed of 11 members.
8 Nine 9 members shall who have practiced in the health field,
9 4 of which shall have been or are currently affiliated with a
10 Health Maintenance Organization. Two of the members shall be
11 members of the general public, one of whom is over 50 years
12 of age. Each member shall be appointed by the Director of
13 the Department of Public Health and serve at the pleasure of
14 that Director and shall receive no compensation for services
15 rendered other than reimbursement for expenses. Six Five
16 members of the Board shall constitute a quorum. A vacancy in
17 the membership of the Advisory Board shall not impair the
18 right of a quorum to exercise all rights and perform all
19 duties of the Board. The Health Maintenance Advisory Board
20 has the power to review and comment on proposed rules and
21 regulations to be promulgated by the Director of the
22 Department of Public Health within 30 days after those
23 proposed rules and regulations have been submitted to the
24 Advisory Board.
25 (b) Issuance of a certificate of authority shall be
26 granted if the following conditions are met:
27 (1) the requirements of subsection (c) of Section
28 2-1 have been fulfilled;
29 (2) the persons responsible for the conduct of the
30 affairs of the applicant are competent, trustworthy, and
31 possess good reputations, and have had appropriate
32 experience, training or education;
33 (3) the Director of the Department of Public Health
34 certifies that the Health Maintenance Organization's
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1 proposed plan of operation meets the requirements of this
2 Act;
3 (4) the Health Care Plan furnishes basic health
4 care services on a prepaid basis, through insurance or
5 otherwise, except to the extent of reasonable
6 requirements for co-payments or deductibles as authorized
7 by this Act;
8 (5) the Health Maintenance Organization is
9 financially responsible and may reasonably be expected to
10 meet its obligations to enrollees and prospective
11 enrollees; in making this determination, the Director
12 shall consider:
13 (A) the financial soundness of the applicant's
14 arrangements for health services and the minimum
15 standard rates, co-payments and other patient
16 charges used in connection therewith;
17 (B) the adequacy of working capital, other
18 sources of funding, and provisions for
19 contingencies; and
20 (C) that no certificate of authority shall be
21 issued if the initial minimum net worth of the
22 applicant is less than $2,000,000. The initial net
23 worth shall be provided in cash and securities in
24 combination and form acceptable to the Director;
25 (6) the agreements with providers for the provision
26 of health services contain the provisions required by
27 Section 2-8 of this Act; and
28 (7) any deficiencies identified by the Director
29 have been corrected.
30 (Source: P.A. 86-620; 86-1475.)
31 (215 ILCS 125/5-3.6 new)
32 Sec. 5-3.6. Managed Care Reform and Patient Rights Act.
33 Health maintenance organizations are subject to the
SB251 Enrolled -72- LRB9102764EGfg
1 provisions of the Managed Care Reform and Patient Rights Act.
2
3 (215 ILCS 125/6-7) (from Ch. 111 1/2, par. 1418.7)
4 Sec. 6-7. Board of Directors. The board of directors of
5 the Association consists of not less than 7 5 nor more than
6 11 9 members serving terms as established in the plan of
7 operation. The members of the board are to be selected by
8 member organizations subject to the approval of the Director,
9 except the Director shall name 2 members who are current
10 enrollees, one of whom is over 50 years of age. Vacancies on
11 the board must be filled for the remaining period of the term
12 in the manner described in the plan of operation. To select
13 the initial board of directors, and initially organize the
14 Association, the Director must give notice to all member
15 organizations of the time and place of the organizational
16 meeting. In determining voting rights at the organizational
17 meeting each member organization is entitled to one vote in
18 person or by proxy. If the board of directors is not
19 selected at the organizational meeting, the Director may
20 appoint the initial members.
21 In approving selections or in appointing members to the
22 board, the Director must consider, whether all member
23 organizations are fairly represented.
24 Members of the board may be reimbursed from the assets of
25 the Association for expenses incurred by them as members of
26 the board of directors but members of the board may not
27 otherwise be compensated by the Association for their
28 services.
29 (Source: P.A. 85-20.)
30 Section 240. The Limited Health Service Organization Act
31 is amended by adding Section 4002.6 as follows:
SB251 Enrolled -73- LRB9102764EGfg
1 (215 ILCS 130/4002.6 new)
2 Sec. 4002.6. Managed Care Reform and Patient Rights Act.
3 Except for health care plans offering only dental services or
4 only vision services, limited health service organizations
5 are subject to the provisions of the Managed Care Reform and
6 Patient Rights Act.
7 Section 245. The Voluntary Health Services Plans Act is
8 amended by adding Section 15.30 as follows:
9 (215 ILCS 165/15.30 new)
10 Sec. 15.30. Managed Care Reform and Patient Rights Act.
11 A health service plan corporation is subject to the
12 provisions of the Managed Care Reform and Patient Rights Act.
13
14 Section 250. The Illinois Public Aid Code is amended by
15 adding Section 5-16.12 as follows:
16 (305 ILCS 5/5-16.12 new)
17 Sec. 5-16.12. Managed Care Reform and Patient Rights
18 Act. The medical assistance program and other programs
19 administered by the Department are subject to the provisions
20 of the Managed Care Reform and Patient Rights Act. The
21 Department may adopt rules to implement those provisions.
22 These rules shall require compliance with that Act in the
23 medical assistance managed care programs and other programs
24 administered by the Department. The medical assistance
25 fee-for-service program is not subject to the provisions of
26 the Managed Care Reform and Patient Rights Act.
27 Nothing in the Managed Care Reform and Patient Rights Act
28 shall be construed to mean that the Department is a health
29 care plan as defined in that Act simply because the
30 Department enters into contractual relationships with health
SB251 Enrolled -74- LRB9102764EGfg
1 care plans.
2 Section 299. Effective date. This Section and Section
3 200 of this Act take effect upon becoming law; Sections 25
4 and 85 take effect July 1, 2000; and the remaining Sections
5 of this Act take effect January 1, 2000.
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