95TH GENERAL ASSEMBLY
State of Illinois
2007 and 2008
SB2386

 

Introduced 2/14/2008, by Sen. M. Maggie Crotty

 

SYNOPSIS AS INTRODUCED:
 
215 ILCS 5/356z.11 new
215 ILCS 125/5-3   from Ch. 111 1/2, par. 1411.2
215 ILCS 165/10   from Ch. 32, par. 604

    Amends the Illinois Insurance Code, the Health Maintenance Organization Act, and the Voluntary Health Services Plans Act to provide coverage for prosthetic devices that equals those benefits provided under federal laws for health insurance for the aged and disabled. Provides that a policy or plan may require prior authorization for prosthetic devices in the same manner that prior authorization is required for any other covered benefit. Provides that covered benefits are limited to the most appropriate model that adequately meets the medical needs of the patient as determined by the insured's treating physician. Provides that repairs and replacements of prosthetic devices are also covered, subject to copayments and deductibles, unless necessitated by misuse or loss. Provides that a policy or plan may require that, if coverage is provided through a managed care plan, the benefits mandated pursuant to the provision shall be covered benefits only if the prosthetic devices are provided by a vendor and prosthetic services are render by a provider who contracts with or is designated by the carrier, to the extent that a carrier provides in-network and out-of-network service, the coverage for the prosthetic device shall be offered no less extensively. Effective immediately.


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A BILL FOR

 

SB2386 LRB095 18326 KBJ 44410 b

1     AN ACT concerning regulation.
 
2     Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
 
4     Section 5. The Illinois Insurance Code is amended by adding
5 Section 356z.11 as follows:
 
6     (215 ILCS 5/356z.11 new)
7     Sec. 356z.11. Prosthetic devices.
8     (a) A group or individual policy of accident or health
9 insurance or managed care plan amended, delivered, issued of
10 renewed after the effective date of this amendatory Act of the
11 95th General Assembly must provide coverage for prosthetic
12 devices that equal the coverage provided under federal laws for
13 health insurance for the aged and disabled. For purposes of
14 this Section "prosthetic device" means an artificial device to
15 replace, in whole or in part, an arm or leg.
16     (b) A policy or plan may require prior authorization for
17 prosthetic devices in the same manner that prior authorization
18 is required for any other covered benefit. Covered benefits are
19 limited to the most appropriate model that adequately meets the
20 medical needs of the patient as determined by the insured's
21 treating physician.
22     (c) Repairs and replacements of prosthetic devices are also
23 covered, subject to copayments and deductibles, unless

 

 

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1 necessitated by misuse or loss.
2     (d) A policy or plan may require that, if coverage is
3 provided through a managed care plan, the benefits mandated
4 pursuant to this Section shall be covered benefits only if the
5 prosthetic devices are provided by a vendor and prosthetic
6 services are render by a provider who contracts with or is
7 designated by the carrier, to the extent that a carrier
8 provides in-network and out-of-network service, the coverage
9 for the prosthetic device shall be offered no less extensively.
 
10     Section 10. The Health Maintenance Organization Act is
11 amended by changing Section 5-3 as follows:
 
12     (215 ILCS 125/5-3)  (from Ch. 111 1/2, par. 1411.2)
13     Sec. 5-3. Insurance Code provisions.
14     (a) Health Maintenance Organizations shall be subject to
15 the provisions of Sections 133, 134, 137, 140, 141.1, 141.2,
16 141.3, 143, 143c, 147, 148, 149, 151, 152, 153, 154, 154.5,
17 154.6, 154.7, 154.8, 155.04, 355.2, 356m, 356v, 356w, 356x,
18 356y, 356z.2, 356z.4, 356z.5, 356z.6, 356z.8, 356z.9, 356z.10,
19 356z.11 356z.9, 364.01, 367.2, 367.2-5, 367i, 368a, 368b, 368c,
20 368d, 368e, 370c, 401, 401.1, 402, 403, 403A, 408, 408.2, 409,
21 412, 444, and 444.1, paragraph (c) of subsection (2) of Section
22 367, and Articles IIA, VIII 1/2, XII, XII 1/2, XIII, XIII 1/2,
23 XXV, and XXVI of the Illinois Insurance Code.
24     (b) For purposes of the Illinois Insurance Code, except for

 

 

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1 Sections 444 and 444.1 and Articles XIII and XIII 1/2, Health
2 Maintenance Organizations in the following categories are
3 deemed to be "domestic companies":
4         (1) a corporation authorized under the Dental Service
5     Plan Act or the Voluntary Health Services Plans Act;
6         (2) a corporation organized under the laws of this
7     State; or
8         (3) a corporation organized under the laws of another
9     state, 30% or more of the enrollees of which are residents
10     of this State, except a corporation subject to
11     substantially the same requirements in its state of
12     organization as is a "domestic company" under Article VIII
13     1/2 of the Illinois Insurance Code.
14     (c) In considering the merger, consolidation, or other
15 acquisition of control of a Health Maintenance Organization
16 pursuant to Article VIII 1/2 of the Illinois Insurance Code,
17         (1) the Director shall give primary consideration to
18     the continuation of benefits to enrollees and the financial
19     conditions of the acquired Health Maintenance Organization
20     after the merger, consolidation, or other acquisition of
21     control takes effect;
22         (2)(i) the criteria specified in subsection (1)(b) of
23     Section 131.8 of the Illinois Insurance Code shall not
24     apply and (ii) the Director, in making his determination
25     with respect to the merger, consolidation, or other
26     acquisition of control, need not take into account the

 

 

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1     effect on competition of the merger, consolidation, or
2     other acquisition of control;
3         (3) the Director shall have the power to require the
4     following information:
5             (A) certification by an independent actuary of the
6         adequacy of the reserves of the Health Maintenance
7         Organization sought to be acquired;
8             (B) pro forma financial statements reflecting the
9         combined balance sheets of the acquiring company and
10         the Health Maintenance Organization sought to be
11         acquired as of the end of the preceding year and as of
12         a date 90 days prior to the acquisition, as well as pro
13         forma financial statements reflecting projected
14         combined operation for a period of 2 years;
15             (C) a pro forma business plan detailing an
16         acquiring party's plans with respect to the operation
17         of the Health Maintenance Organization sought to be
18         acquired for a period of not less than 3 years; and
19             (D) such other information as the Director shall
20         require.
21     (d) The provisions of Article VIII 1/2 of the Illinois
22 Insurance Code and this Section 5-3 shall apply to the sale by
23 any health maintenance organization of greater than 10% of its
24 enrollee population (including without limitation the health
25 maintenance organization's right, title, and interest in and to
26 its health care certificates).

 

 

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1     (e) In considering any management contract or service
2 agreement subject to Section 141.1 of the Illinois Insurance
3 Code, the Director (i) shall, in addition to the criteria
4 specified in Section 141.2 of the Illinois Insurance Code, take
5 into account the effect of the management contract or service
6 agreement on the continuation of benefits to enrollees and the
7 financial condition of the health maintenance organization to
8 be managed or serviced, and (ii) need not take into account the
9 effect of the management contract or service agreement on
10 competition.
11     (f) Except for small employer groups as defined in the
12 Small Employer Rating, Renewability and Portability Health
13 Insurance Act and except for medicare supplement policies as
14 defined in Section 363 of the Illinois Insurance Code, a Health
15 Maintenance Organization may by contract agree with a group or
16 other enrollment unit to effect refunds or charge additional
17 premiums under the following terms and conditions:
18         (i) the amount of, and other terms and conditions with
19     respect to, the refund or additional premium are set forth
20     in the group or enrollment unit contract agreed in advance
21     of the period for which a refund is to be paid or
22     additional premium is to be charged (which period shall not
23     be less than one year); and
24         (ii) the amount of the refund or additional premium
25     shall not exceed 20% of the Health Maintenance
26     Organization's profitable or unprofitable experience with

 

 

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1     respect to the group or other enrollment unit for the
2     period (and, for purposes of a refund or additional
3     premium, the profitable or unprofitable experience shall
4     be calculated taking into account a pro rata share of the
5     Health Maintenance Organization's administrative and
6     marketing expenses, but shall not include any refund to be
7     made or additional premium to be paid pursuant to this
8     subsection (f)). The Health Maintenance Organization and
9     the group or enrollment unit may agree that the profitable
10     or unprofitable experience may be calculated taking into
11     account the refund period and the immediately preceding 2
12     plan years.
13     The Health Maintenance Organization shall include a
14 statement in the evidence of coverage issued to each enrollee
15 describing the possibility of a refund or additional premium,
16 and upon request of any group or enrollment unit, provide to
17 the group or enrollment unit a description of the method used
18 to calculate (1) the Health Maintenance Organization's
19 profitable experience with respect to the group or enrollment
20 unit and the resulting refund to the group or enrollment unit
21 or (2) the Health Maintenance Organization's unprofitable
22 experience with respect to the group or enrollment unit and the
23 resulting additional premium to be paid by the group or
24 enrollment unit.
25     In no event shall the Illinois Health Maintenance
26 Organization Guaranty Association be liable to pay any

 

 

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1 contractual obligation of an insolvent organization to pay any
2 refund authorized under this Section.
3 (Source: P.A. 94-906, eff. 1-1-07; 94-1076, eff. 12-29-06;
4 95-422, eff. 8-24-07; 95-520, eff. 8-28-07; revised 12-4-07.)
 
5     Section 15. The Voluntary Health Services Plans Act is
6 amended by changing Section 10 as follows:
 
7     (215 ILCS 165/10)  (from Ch. 32, par. 604)
8     Sec. 10. Application of Insurance Code provisions. Health
9 services plan corporations and all persons interested therein
10 or dealing therewith shall be subject to the provisions of
11 Articles IIA and XII 1/2 and Sections 3.1, 133, 140, 143, 143c,
12 149, 155.37, 354, 355.2, 356g.5, 356r, 356t, 356u, 356v, 356w,
13 356x, 356y, 356z.1, 356z.2, 356z.4, 356z.5, 356z.6, 356z.8,
14 356z.9, 356z.10, 356z.11 356z.9, 364.01, 367.2, 368a, 401,
15 401.1, 402, 403, 403A, 408, 408.2, and 412, and paragraphs (7)
16 and (15) of Section 367 of the Illinois Insurance Code.
17 (Source: P.A. 94-1076, eff. 12-29-06; 95-189, eff. 8-16-07;
18 95-331, eff. 8-21-07; 95-422, eff. 8-24-07; 95-520, eff.
19 8-28-07; revised 12-5-07.)
 
20     Section 99. Effective date. This Act takes effect upon
21 becoming law.