97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
SB1621

 

Introduced 2/9/2011, by Sen. Heather A. Steans

 

SYNOPSIS AS INTRODUCED:
 
215 ILCS 5/356z.16
215 ILCS 5/356z.19 new
215 ILCS 125/5-3  from Ch. 111 1/2, par. 1411.2
215 ILCS 130/4003  from Ch. 73, par. 1504-3
215 ILCS 165/10  from Ch. 32, par. 604

    Amends the Illinois Insurance Code. Provides that the provision concerning tobacco use cessation programs does not apply to short-term travel, disability income, long-term care, accident only, or limited or specified disease policies. Creates the Tobacco Dependence Coverage Law. Provides that group and individual accident and health policies and managed care plans issued to a resident of the State must provide coverage or reimbursement of up to $500 annually for a tobacco use cessation program for insureds who are 18 years of age or older. Provides that notice of the availability of coverage shall be delivered to the insured. Provides that an insurer may not deny eligibility or continued eligibility to enroll or renew coverage solely for the purpose of avoiding the requirements of the Law. Provides that an insurer may not penalize or reduce or limit the reimbursement of an attending provider or provide incentives to induce the provider to provide care that is inconsistent with the Law. Amends the Health Maintenance Organization Act, Limited Health Service Organization Act, and Voluntary Health Services Plans Act to provide that those Acts shall be subject to the provisions of the Illinois Insurance Code concerning tobacco use cessation programs.


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A BILL FOR

 

SB1621LRB097 07947 RPM 48065 b

1    AN ACT concerning insurance.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Insurance Code is amended by
5changing Section 356z.16 and adding Section 356z.19 as follows:
 
6    (215 ILCS 5/356z.16)
7    Sec. 356z.16. Applicability of mandated benefits to
8supplemental policies. Unless specified otherwise, the
9following Sections of the Illinois Insurance Code do not apply
10to short-term travel, disability income, long-term care,
11accident only, or limited or specified disease policies: 356b,
12356c, 356d, 356g, 356k, 356m, 356n, 356p, 356q, 356r, 356t,
13356u, 356w, 356x, 356z.1, 356z.2, 356z.4, 356z.5, 356z.6,
14356z.8, 356z.12, 356z.19, 367.2-5, and 367e.
15(Source: P.A. 96-180, eff. 1-1-10; 96-1000, eff. 7-2-10;
1696-1034, eff. 1-1-11.)
 
17    (215 ILCS 5/356z.19 new)
18    Sec. 356z.19. Tobacco use cessation programs.
19    (a) This Section may be referred to as the Tobacco
20Dependence Coverage Law.
21    (b) Tobacco use is the number one cause of preventable
22disease and death in Illinois, costing $4.1 billion annually in

 

 

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1direct health care costs and an additional $4.35 billion in
2lost productivity. In Illinois, the smoking rates are highest
3among African Americans (25.8%). Smoking rates among lesbian,
4gay, and bisexual adults range from 25% to 44%. The U.S. Public
5Health Service Clinical Practice Guideline 2008 Update found
6that tobacco dependence treatments are both clinically
7effective and highly cost effective. A study in the Journal of
8Preventive Medicine concluded that comprehensive smoking
9cessation treatment is one of the 3 most important and cost
10effective preventive services that can be provided in medical
11practice. Greater efforts are needed to achieve more of this
12potential value by increasing current low levels of
13performance.
14    (c) In this Section, "tobacco use cessation program" means
15a program recommended by a physician that follows
16evidence-based treatment, such as is outlined in the United
17States Public Health Service guidelines for tobacco use
18cessation. "Tobacco use cessation program" includes education
19and medical treatment components designed to assist a person in
20ceasing the use of tobacco products. "Tobacco use cessation
21program" includes education and counseling by physicians or
22associated medical personnel and all FDA approved medications
23for the treatment of tobacco dependence irrespective of whether
24they are available only over the counter, only by prescription,
25or both over the counter and by prescription.
26    (d) A group or individual policy of accident and health

 

 

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1insurance or managed care plan amended, delivered, issued, or
2renewed after the effective date of this amendatory Act of the
397th General Assembly to a resident of this State must provide
4coverage or reimbursement of up to $500 annually for a tobacco
5use cessation program for a person enrolled in the plan who is
618 years of age or older.
7    (e) Written notice of the availability of coverage under
8this Section shall be delivered to the insured upon enrollment
9and annually thereafter. An insurer may not deny to an insured
10eligibility or continued eligibility to enroll or to renew
11coverage under the terms of the plan solely for the purpose of
12avoiding the requirements of this Section. An insurer may not
13penalize or reduce or limit the reimbursement of an attending
14provider or provide incentives, monetary or otherwise, to an
15attending provider to induce the provider to provide care to an
16insured in a manner inconsistent with this Section.
 
17    Section 10. The Health Maintenance Organization Act is
18amended by changing Section 5-3 as follows:
 
19    (215 ILCS 125/5-3)  (from Ch. 111 1/2, par. 1411.2)
20    Sec. 5-3. Insurance Code provisions.
21    (a) Health Maintenance Organizations shall be subject to
22the provisions of Sections 133, 134, 137, 140, 141.1, 141.2,
23141.3, 143, 143c, 147, 148, 149, 151, 152, 153, 154, 154.5,
24154.6, 154.7, 154.8, 155.04, 355.2, 356g.5-1, 356m, 356v, 356w,

 

 

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1356x, 356y, 356z.2, 356z.4, 356z.5, 356z.6, 356z.8, 356z.9,
2356z.10, 356z.11, 356z.12, 356z.13, 356z.14, 356z.15, 356z.17,
3356z.18, 356z.19, 364.01, 367.2, 367.2-5, 367i, 368a, 368b,
4368c, 368d, 368e, 370c, 401, 401.1, 402, 403, 403A, 408, 408.2,
5409, 412, 444, and 444.1, paragraph (c) of subsection (2) of
6Section 367, and Articles IIA, VIII 1/2, XII, XII 1/2, XIII,
7XIII 1/2, XXV, and XXVI of the Illinois Insurance Code.
8    (b) For purposes of the Illinois Insurance Code, except for
9Sections 444 and 444.1 and Articles XIII and XIII 1/2, Health
10Maintenance Organizations in the following categories are
11deemed to be "domestic companies":
12        (1) a corporation authorized under the Dental Service
13    Plan Act or the Voluntary Health Services Plans Act;
14        (2) a corporation organized under the laws of this
15    State; or
16        (3) a corporation organized under the laws of another
17    state, 30% or more of the enrollees of which are residents
18    of this State, except a corporation subject to
19    substantially the same requirements in its state of
20    organization as is a "domestic company" under Article VIII
21    1/2 of the Illinois Insurance Code.
22    (c) In considering the merger, consolidation, or other
23acquisition of control of a Health Maintenance Organization
24pursuant to Article VIII 1/2 of the Illinois Insurance Code,
25        (1) the Director shall give primary consideration to
26    the continuation of benefits to enrollees and the financial

 

 

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1    conditions of the acquired Health Maintenance Organization
2    after the merger, consolidation, or other acquisition of
3    control takes effect;
4        (2)(i) the criteria specified in subsection (1)(b) of
5    Section 131.8 of the Illinois Insurance Code shall not
6    apply and (ii) the Director, in making his determination
7    with respect to the merger, consolidation, or other
8    acquisition of control, need not take into account the
9    effect on competition of the merger, consolidation, or
10    other acquisition of control;
11        (3) the Director shall have the power to require the
12    following information:
13            (A) certification by an independent actuary of the
14        adequacy of the reserves of the Health Maintenance
15        Organization sought to be acquired;
16            (B) pro forma financial statements reflecting the
17        combined balance sheets of the acquiring company and
18        the Health Maintenance Organization sought to be
19        acquired as of the end of the preceding year and as of
20        a date 90 days prior to the acquisition, as well as pro
21        forma financial statements reflecting projected
22        combined operation for a period of 2 years;
23            (C) a pro forma business plan detailing an
24        acquiring party's plans with respect to the operation
25        of the Health Maintenance Organization sought to be
26        acquired for a period of not less than 3 years; and

 

 

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1            (D) such other information as the Director shall
2        require.
3    (d) The provisions of Article VIII 1/2 of the Illinois
4Insurance Code and this Section 5-3 shall apply to the sale by
5any health maintenance organization of greater than 10% of its
6enrollee population (including without limitation the health
7maintenance organization's right, title, and interest in and to
8its health care certificates).
9    (e) In considering any management contract or service
10agreement subject to Section 141.1 of the Illinois Insurance
11Code, the Director (i) shall, in addition to the criteria
12specified in Section 141.2 of the Illinois Insurance Code, take
13into account the effect of the management contract or service
14agreement on the continuation of benefits to enrollees and the
15financial condition of the health maintenance organization to
16be managed or serviced, and (ii) need not take into account the
17effect of the management contract or service agreement on
18competition.
19    (f) Except for small employer groups as defined in the
20Small Employer Rating, Renewability and Portability Health
21Insurance Act and except for medicare supplement policies as
22defined in Section 363 of the Illinois Insurance Code, a Health
23Maintenance Organization may by contract agree with a group or
24other enrollment unit to effect refunds or charge additional
25premiums under the following terms and conditions:
26        (i) the amount of, and other terms and conditions with

 

 

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1    respect to, the refund or additional premium are set forth
2    in the group or enrollment unit contract agreed in advance
3    of the period for which a refund is to be paid or
4    additional premium is to be charged (which period shall not
5    be less than one year); and
6        (ii) the amount of the refund or additional premium
7    shall not exceed 20% of the Health Maintenance
8    Organization's profitable or unprofitable experience with
9    respect to the group or other enrollment unit for the
10    period (and, for purposes of a refund or additional
11    premium, the profitable or unprofitable experience shall
12    be calculated taking into account a pro rata share of the
13    Health Maintenance Organization's administrative and
14    marketing expenses, but shall not include any refund to be
15    made or additional premium to be paid pursuant to this
16    subsection (f)). The Health Maintenance Organization and
17    the group or enrollment unit may agree that the profitable
18    or unprofitable experience may be calculated taking into
19    account the refund period and the immediately preceding 2
20    plan years.
21    The Health Maintenance Organization shall include a
22statement in the evidence of coverage issued to each enrollee
23describing the possibility of a refund or additional premium,
24and upon request of any group or enrollment unit, provide to
25the group or enrollment unit a description of the method used
26to calculate (1) the Health Maintenance Organization's

 

 

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1profitable experience with respect to the group or enrollment
2unit and the resulting refund to the group or enrollment unit
3or (2) the Health Maintenance Organization's unprofitable
4experience with respect to the group or enrollment unit and the
5resulting additional premium to be paid by the group or
6enrollment unit.
7    In no event shall the Illinois Health Maintenance
8Organization Guaranty Association be liable to pay any
9contractual obligation of an insolvent organization to pay any
10refund authorized under this Section.
11    (g) Rulemaking authority to implement Public Act 95-1045,
12if any, is conditioned on the rules being adopted in accordance
13with all provisions of the Illinois Administrative Procedure
14Act and all rules and procedures of the Joint Committee on
15Administrative Rules; any purported rule not so adopted, for
16whatever reason, is unauthorized.
17(Source: P.A. 95-422, eff. 8-24-07; 95-520, eff. 8-28-07;
1895-876, eff. 8-21-08; 95-958, eff. 6-1-09; 95-978, eff. 1-1-09;
1995-1005, eff. 12-12-08; 95-1045, eff. 3-27-09; 95-1049, eff.
201-1-10; 96-328, eff. 8-11-09; 96-639, eff. 1-1-10; 96-833, eff.
216-1-10; 96-1000, eff. 7-2-10.)
 
22    Section 15. The Limited Health Service Organization Act is
23amended by changing Section 4003 as follows:
 
24    (215 ILCS 130/4003)  (from Ch. 73, par. 1504-3)

 

 

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1    Sec. 4003. Illinois Insurance Code provisions. Limited
2health service organizations shall be subject to the provisions
3of Sections 133, 134, 137, 140, 141.1, 141.2, 141.3, 143, 143c,
4147, 148, 149, 151, 152, 153, 154, 154.5, 154.6, 154.7, 154.8,
5155.04, 155.37, 355.2, 356v, 356z.10, 356z.19, 368a, 401,
6401.1, 402, 403, 403A, 408, 408.2, 409, 412, 444, and 444.1 and
7Articles IIA, VIII 1/2, XII, XII 1/2, XIII, XIII 1/2, XXV, and
8XXVI of the Illinois Insurance Code. For purposes of the
9Illinois Insurance Code, except for Sections 444 and 444.1 and
10Articles XIII and XIII 1/2, limited health service
11organizations in the following categories are deemed to be
12domestic companies:
13        (1) a corporation under the laws of this State; or
14        (2) a corporation organized under the laws of another
15    state, 30% of more of the enrollees of which are residents
16    of this State, except a corporation subject to
17    substantially the same requirements in its state of
18    organization as is a domestic company under Article VIII
19    1/2 of the Illinois Insurance Code.
20(Source: P.A. 95-520, eff. 8-28-07; 95-876, eff. 8-21-08.)
 
21    Section 20. The Voluntary Health Services Plans Act is
22amended by changing Section 10 as follows:
 
23    (215 ILCS 165/10)  (from Ch. 32, par. 604)
24    Sec. 10. Application of Insurance Code provisions. Health

 

 

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1services plan corporations and all persons interested therein
2or dealing therewith shall be subject to the provisions of
3Articles IIA and XII 1/2 and Sections 3.1, 133, 140, 143, 143c,
4149, 155.37, 354, 355.2, 356g, 356g.5, 356g.5-1, 356r, 356t,
5356u, 356v, 356w, 356x, 356y, 356z.1, 356z.2, 356z.4, 356z.5,
6356z.6, 356z.8, 356z.9, 356z.10, 356z.11, 356z.12, 356z.13,
7356z.14, 356z.15, 356z.18, 356z.19, 364.01, 367.2, 368a, 401,
8401.1, 402, 403, 403A, 408, 408.2, and 412, and paragraphs (7)
9and (15) of Section 367 of the Illinois Insurance Code.
10    Rulemaking authority to implement Public Act 95-1045, if
11any, is conditioned on the rules being adopted in accordance
12with all provisions of the Illinois Administrative Procedure
13Act and all rules and procedures of the Joint Committee on
14Administrative Rules; any purported rule not so adopted, for
15whatever reason, is unauthorized.
16(Source: P.A. 95-189, eff. 8-16-07; 95-331, eff. 8-21-07;
1795-422, eff. 8-24-07; 95-520, eff. 8-28-07; 95-876, eff.
188-21-08; 95-958, eff. 6-1-09; 95-978, eff. 1-1-09; 95-1005,
19eff. 12-12-08; 95-1045, eff. 3-27-09; 95-1049, eff. 1-1-10;
2096-328, eff. 8-11-09; 96-833, eff. 6-1-10; 96-1000, eff.
217-2-10.)