SB2063 104TH GENERAL ASSEMBLY

LRB104 08937 BAB 18992 b

104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
SB2063

Introduced 2/6/2025, by Sen. Paul Faraci

SYNOPSIS AS INTRODUCED:

215 ILCS 5/155.18	from Ch. 73, par. 767.18
215 ILCS 5/155.18b new

Amends the Illinois Insurance Code. Provides that companies that issue medical liability insurance must evaluate premium rates based on the specific scope of practice of each insured physician who specializes in obstetric and gynecologic services (OB-GYN), considering whether the OB-GYN provides obstetric services, including childbirth, or limits the OB-GYN's practice to gynecologic services only. Requires companies that issue medical liability insurance to classify OB-GYNs who do not provide obstetric services as lower-risk providers for the purposes of determining premium rates. Requires the Department of Insurance to establish guidelines for companies that issue medical liability insurance to classify and adjust premiums based on the risk profiles of OB-GYNs.

A BILL FOR

AN ACT concerning regulation.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 1. This Act may be referred to as the OB-GYN Malpractice Premium Adjustment Law.

Section 5. The Illinois Insurance Code is amended by changing Section 155.18 and by adding Section 155.18b as follows:

(215 ILCS 5/155.18) (from Ch. 73, par. 767.18)

Sec. 155.18. (a) This Section shall apply to insurance on risks based upon negligence by a physician, hospital or other health care provider, referred to herein as medical liability insurance. This Section shall not apply to contracts of reinsurance, nor to any farm, county, district or township mutual insurance company transacting business under an Act entitled "An Act relating to local mutual district, county and township insurance companies", approved March 13, 1936, as now or hereafter amended, nor to any such company operating under a special charter.

To the extent that the provisions of this Section conflict with the provisions of Section 155.18b, the provisions of Section 155.18b control.

(b) The following standards shall apply to the making and use of rates pertaining to all classes of medical liability insurance:

(1) Rates shall not be excessive or inadequate, as herein defined, nor shall they be unfairly discriminatory. No rate shall be held to be excessive unless such rate is unreasonably high for the insurance provided, and a reasonable degree of competition does not exist in the area with respect to the classification to which such rate is applicable.

No rate shall be held inadequate unless it is unreasonably low for the insurance provided and continued use of it would endanger solvency of the company.

(2) Consideration shall be given, to the extent applicable, to past and prospective loss experience within and outside this State, to a reasonable margin for underwriting profit and contingencies, to past and prospective expenses both countrywide and those especially applicable to this State, and to all other factors, including judgment factors, deemed relevant within and outside this State.

Consideration may also be given in the making and use of rates to dividends, savings or unabsorbed premium deposits allowed or returned by companies to their policyholders, members or subscribers.

(3) The systems of expense provisions included in the rates for use by any company or group of companies may differ from those of other companies or groups of companies to reflect the operating methods of any such company or group with respect to any kind of insurance, or with respect to any subdivision or combination thereof.

(4) Risks may be grouped by classifications for the establishment of rates and minimum premiums. Classification rates may be modified to produce rates for individual risks in accordance with rating plans which establish standards for measuring variations in hazards or expense provisions, or both. Such standards may measure any difference among risks that have a probable effect upon losses or expenses. Such classifications or modifications of classifications of risks may be established based upon size, expense, management, individual experience, location or dispersion of hazard, or any other reasonable considerations and shall apply to all risks under the same or substantially the same circumstances or conditions. The rate for an established classification should be related generally to the anticipated loss and expense factors of the class.

(c) Every company writing medical liability insurance shall file with the Director of Insurance the rates and rating schedules it uses for medical liability insurance.

(1) This filing shall occur at least annually and as often as the rates are changed or amended.

(2) For the purposes of this Section any change in premium to the company's insureds as a result of a change in the company's base rates or a change in its increased limits factors shall constitute a change in rates and shall require a filing with the Director.

(3) It shall be certified in such filing by an officer of the company and a qualified actuary that the company's rates are based on sound actuarial principles and are not inconsistent with the company's experience.

(d) If after a hearing the Director finds:

(1) that any rate, rating plan or rating system violates the provisions of this Section applicable to it, he may issue an order to the company which has been the subject of the hearing specifying in what respects such violation exists and stating when, within a reasonable period of time, the further use of such rate or rating system by such company in contracts of insurance made thereafter shall be prohibited;

(2) that the violation of any of the provisions of this Section applicable to it by any company which has been the subject of hearing was wilful, he may suspend or revoke, in whole or in part, the certificate of authority of such company with respect to the class of insurance which has been the subject of the hearing.

(Source: P.A. 103-426, eff. 8-4-23.)

(215 ILCS 5/155.18b new)

Sec. 155.18b. Medical liability insurance for obstetricians and gynecologists.

(a) The purpose of this Section is to ensure fair and equitable medical malpractice premiums for obstetricians and gynecologists (OB-GYNs) by requiring companies that issue medical liability insurance to consider reduced liability risk for OB-GYNs who do not perform childbirth or obstetric services.

(b) As used in this Act:

"Gynecologic services" means medical care or procedures related to female reproductive health, excluding obstetric services.

"OB-GYN" means a physician, as defined in the Medical Practice Act of 1987, who specializes in obstetric and gynecologic services.

"Obstetric services" means any medical care, procedure, or treatment related to pregnancy, labor, delivery, and postpartum care.

(c) Companies that issue medical liability insurance must evaluate premium rates based on the specific scope of practice of each insured OB-GYN, considering whether the OB-GYN:

(1) provides obstetric services, including childbirth; or

(2) limits the OB-GYN's practice to gynecologic services only.

(d) Companies that issue medical liability insurance must classify OB-GYNs who do not provide obstetric services as lower-risk providers for the purposes of determining premium rates.

(e) The Department shall establish guidelines for companies that issue medical liability insurance to classify and adjust premiums based on the risk profiles of OB-GYNs.

(f) To the extent that the provisions of this Section conflict with the provisions of Section 155.18, the provisions of this Section control.