Sen. Susan Garrett

Filed: 5/5/2009

 

 


 

 


 
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1
AMENDMENT TO HOUSE BILL 2325

2     AMENDMENT NO. ______. Amend House Bill 2325 by replacing
3 everything after the enacting clause with the following:
 
4     "Section 5. The Illinois Insurance Code is amended by
5 changing Section 367e as follows:
 
6     (215 ILCS 5/367e)  (from Ch. 73, par. 979e)
7     Sec. 367e. Continuation of Group Hospital, Surgical and
8 Major Medical Coverage After Termination of Employment or
9 Membership. A group policy delivered, issued for delivery,
10 renewed or amended in this state which insures employees or
11 members for hospital, surgical or major medical insurance on an
12 expense incurred or service basis, other than for specific
13 diseases or for accidental injuries only, shall provide that
14 employees or members whose insurance under the group policy
15 would otherwise terminate because of termination of employment
16 or membership or because of a reduction in hours below the

 

 

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1 minimum required by the group plan shall be entitled to
2 continue their hospital, surgical and major medical insurance
3 under that group policy, for themselves and their eligible
4 dependents, subject to all of the group policy's terms and
5 conditions applicable to those forms of insurance and to the
6 following conditions:
7         1. Continuation shall only be available to an employee
8     or member who has been continuously insured under the group
9     policy (and for similar benefits under any group policy
10     which it replaced) during the entire 3 months period ending
11     with such termination or reduction in hours below the
12     minimum required by the group plan. With respect to an
13     employee or member who is involuntarily terminated between
14     September 1, 2008 and December 31, 2009, continuation shall
15     be available if the employee or member was insured under
16     the group policy on the day prior to the termination.
17         2. Continuation shall not be available for any person
18     who is covered by Medicare, except for those individuals
19     who have been covered under a group Medicare supplement
20     policy. Neither shall continuation be available for any
21     person who is covered by any other insured or uninsured
22     plan which provides hospital, surgical or medical coverage
23     for individuals in a group and under which the person was
24     not covered immediately prior to such termination or
25     reduction in hours below the minimum required by the group
26     plan or who exercises his conversion privilege under the

 

 

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1     group policy.
2         3. Continuation need not include dental, vision care,
3     prescription drug benefits, disability income, specified
4     disease, or similar supplementary benefits which are
5     provided under the group policy in addition to its
6     hospital, surgical or major medical benefits.
7         4. Upon termination or reduction in hours below the
8     minimum required by the group plan written notice of
9     continuation shall be presented to the employee or member
10     and the insurer by the employer or mailed by the employer
11     to the last known address of the employee. With respect to
12     an employee or member who is terminated or whose reduction
13     in hours below the minimum required by the group occurs
14     after the effective date of this amendatory Act of the 96th
15     General Assembly, this written notice must be given
16     directly to the employee or member or sent via certified
17     mail within 10 days after the employee's or member's
18     termination or reduction in hours below the minimum
19     required by the group plan. An employee or member who
20     wishes continuation of coverage must request such
21     continuation in writing within the 30 day ten-day period
22     following the later of: (i) the date of such termination or
23     reduction in hours below the minimum required by the group
24     plan, or (ii) the date the employee is given written notice
25     of the right of continuation by either the employer, or the
26     group policyholder, or insurer. The written notice

 

 

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1     provided to an employee or member who is terminated or
2     whose reduction in hours below the minimum required by the
3     group occurs after the effective date of this amendatory
4     Act of the 96th General Assembly must include an
5     explanation that his or her option for continuation
6     coverage will expire within the 30 day period following the
7     later of (i) the date of such termination of employment or
8     reduction in hours below the minimum required by the group
9     plan, or (ii) the date the employee is given written notice
10     of the right of continuation by either the employer, group
11     policyholder, or insurer. In no event, however, may the
12     employee or member elect continuation more than 60 days
13     after the date of such termination or reduction in hours
14     below the minimum required by the group plan. Written
15     notice of continuation presented to the employee or member
16     by the policyholder, or mailed by the policyholder to the
17     last known address of the employee, shall constitute the
18     giving of notice for the purpose of this provision.
19         In the event the employer fails or refuses to provide
20     notice of continuation rights to the employee or member,
21     the insurer is required to mail notice of the continuation
22     rights to the employee or member at the last known address
23     of the employee. In the event the employee or member
24     contacts the insurer regarding continuation rights and
25     advises that notice has not been provided by the employer
26     or group policyholder, the insurer shall mail out notice to

 

 

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1     that individual. An employee or member shall have 30 days
2     from receipt of the notice to elect continuation.
3         4a. Unless contrary to the provisions of, or any rules
4     promulgated pursuant to, Section 3001(a)(7) of Title III of
5     Division B of the federal American Recovery and
6     Reinvestment Act of 2009, with respect to employees or
7     members of health plans that are subject solely to State
8     continuation coverage and who are terminated or whose
9     reduction in hours below the minimum required by the group
10     occurs between the effective date of this amendatory Act of
11     the 96th General Assembly and December 31, 2009, the notice
12     requirements of this Section are not satisfied unless
13     notice is presented to the employee or member by the
14     insurer informing the employee or member of the
15     availability of premium reduction with respect to such
16     coverage under the American Recovery and Reinvestment Act
17     of 2009. Such written notice shall conform to all
18     applicable requirements set forth in Section 3001(a)(7) of
19     Title III of Division B of the federal American Recovery
20     and Reinvestment Act of 2009. The Department shall publish
21     models for the notification that shall be provided by
22     insurers pursuant to this paragraph 4a.
23         4b. Unless contrary to the provisions of, or any rules
24     promulgated pursuant to, Section 3001(a)(7) of Title III of
25     Division B of the federal American Recovery and
26     Reinvestment Act of 2009, with respect to employees or

 

 

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1     members of health plans that are subject solely to State
2     continuation coverage who were terminated or whose
3     reduction in hours below the minimum required by the group
4     occurred between September 1, 2008 and the effective date
5     of this amendatory Act of the 96th General Assembly and who
6     have an election of continuation of coverage pursuant to
7     this Section in effect, notice shall be presented to the
8     employee or member by the insurer informing the employee or
9     member of the availability of premium reduction with
10     respect to such coverage under the American Recovery and
11     Reinvestment Act of 2009. Such written notice shall conform
12     to all applicable requirements set forth in Section
13     3001(a)(7) of Title III of Division B of the federal
14     American Recovery and Reinvestment Act of 2009 and shall be
15     sent to the employee or member within 14 days of the
16     effective date of this amendatory Act of the 96th General
17     Assembly. The Department shall publish models for the
18     notification that shall be provided by insurers pursuant to
19     this paragraph 4b.
20         5. An employee or member electing continuation must pay
21     to the group policyholder or his employer, on a monthly
22     basis in advance, the total amount of premium required by
23     the insurer, including that portion of the premium
24     contributed by the policyholder or employer, if any, but
25     not more than the group rate for the insurance being
26     continued with appropriate reduction in premium for any

 

 

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1     supplementary benefits which have been discontinued under
2     paragraph (3) of this Section. The premium rate required by
3     the insurer shall be the applicable premium required on the
4     due date of each payment.
5         6. Continuation of insurance under the group policy for
6     any person shall terminate when he becomes eligible for
7     Medicare or is covered by any other insured or uninsured
8     plan which provides hospital, surgical or medical coverage
9     for individuals in a group and under which the person was
10     not covered immediately prior to such termination or
11     reduction in hours below the minimum required by the group
12     plan as provided in condition 2 above or, if earlier, at
13     the first to occur of the following:
14             (a) The date 12 9 months after the date the
15         employee's or member's insurance under the policy
16         would otherwise have terminated because of termination
17         of employment or membership or reduction in hours below
18         the minimum required by the group plan.
19             (b) If the employee or member fails to make timely
20         payment of a required contribution, the end of the
21         period for which contributions were made.
22             (c) The date on which the group policy is
23         terminated or, in the case of an employee, the date his
24         employer terminates participation under the group
25         policy. However, if this (c) applies and the coverage
26         ceasing by reason of such termination is replaced by

 

 

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1         similar coverage under another group policy, the
2         following shall apply:
3                 (i) The employee or member shall have the right
4             to become covered under that other group policy,
5             for the balance of the period that he would have
6             remained covered under the prior group policy in
7             accordance with condition 6 had a termination
8             described in this (c) not occurred.
9                 (ii) The prior group policy shall continue to
10             provide benefits to the extent of its accrued
11             liabilities and extensions of benefits as if the
12             replacement had not occurred.
13         7. A notification of the continuation privilege shall
14     be included in each certificate of coverage.
15         8. Continuation shall not be available for any employee
16     who was discharged because of the commission of a felony in
17     connection with his work, or because of theft in connection
18     with his work, for which the employer was in no way
19     responsible; provided the employee admitted his commission
20     of the felony or theft or such act has resulted in a
21     conviction or order of supervision by a court of competent
22     jurisdiction.
23         9. An employee or member without an election of
24     continuation of coverage pursuant to this Section in effect
25     on the effective date of this amendatory Act of the 96th
26     General Assembly may elect continuation pursuant to this

 

 

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1     paragraph 9 if the employee or member: (i) would be an
2     assistance eligible individual as defined in Section
3     3001(a)(3) of Title III of Division B of the federal
4     American Recovery and Reinvestment Act of 2009, if such an
5     election were in effect and (ii) at the time of termination
6     was eligible for continuation pursuant to paragraphs 1 and
7     2 of this Section.
8         Unless contrary to the provisions of, or any rules
9     promulgated pursuant to, Section 3001(a)(7) of Title III of
10     Division B of the federal American Recovery and
11     Reinvestment Act of 2009, written notice of continuation
12     pursuant to this paragraph 9 shall be presented to the
13     employee or member by the insurer or mailed by the insurer
14     to the last known address of the employee or member within
15     30 days after the effective date of this amendatory Act of
16     the 96th General Assembly. Such written notice shall
17     conform to all applicable requirements set forth in section
18     3001(a)(7) of Title III of Division B of the federal
19     American Recovery and Reinvestment Act of 2009. The
20     Department shall publish models for the notification that
21     shall be provided by insurers pursuant to this paragraph 9.
22         An employee or member electing continuation of
23     coverage under this paragraph 9 must request such
24     continuation in writing within 60 days after the date the
25     employee or member receives written notice of the right of
26     continuation by the insurer.

 

 

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1         Continuation of coverage elected pursuant to this
2     paragraph 9 shall commence with the first period of
3     coverage beginning on or after February 17, 2009, the
4     effective date of the federal American Recovery and
5     Reinvestment Act of 2009, and shall not extend beyond the
6     period of continuation that would have been required if the
7     coverage had been elected pursuant to paragraph 4 of this
8     Section.
9         With respect to an employee or member who elects
10     continuation of coverage under this paragraph 9, the period
11     beginning on the date of the employee's or member's
12     involuntary termination of employment and ending on the
13     date of the first period of coverage on or after February
14     17, 2009 shall be disregarded for purposes of determining
15     the 63-day period referred to in Section 20 of the Illinois
16     Health Insurance Portability and Accountability Act.
17     The requirements of this amendatory Act of 1983 shall apply
18 to any group policy as defined in this Section, delivered or
19 issued for delivery on or after 180 days following the
20 effective date of this amendatory Act of 1983.
21     The requirements of this amendatory Act of 1985 shall apply
22 to any group policy as defined in this Section, delivered,
23 issued for delivery, renewed or amended on or after 180 days
24 following the effective date of this amendatory Act of 1985.
25 (Source: P.A. 93-477, eff. 1-1-04.)
 

 

 

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1     Section 10. The Health Maintenance Organization Act is
2 amended by changing Section 4-9.2 as follows:
 
3     (215 ILCS 125/4-9.2)  (from Ch. 111 1/2, par. 1409.2-2)
4     Sec. 4-9.2. Continuation of group HMO coverage after
5 termination of employee or membership. A group contract
6 delivered, issued for delivery, renewed, or amended in this
7 State that covers employees or members for health care services
8 shall provide that employees or members whose coverage under
9 the group contract would otherwise terminate because of
10 termination of employment or membership or because of a
11 reduction in hours below the minimum required by the group
12 contract shall be entitled to continue their coverage under
13 that group contract, for themselves and their eligible
14 dependents, subject to all of the group contract's terms and
15 conditions applicable to those forms of coverage and to the
16 following conditions:
17         (1) Continuation shall only be available to an employee
18     or member who has been continuously covered under the group
19     contract (and for similar benefits under any group contract
20     that it replaced) during the entire 3 month period ending
21     with the termination of employment or membership or
22     reduction in hours below the minimum required by the group
23     contract. With respect to an employee or member who is
24     involuntarily terminated between September 1, 2008 and
25     December 31, 2009, continuation shall be available if the

 

 

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1     employee or member was insured under the group policy on
2     the day prior to such termination.
3         (2) Continuation shall not be available for any
4     enrollee who is covered by Medicare, except for those
5     individuals who have been covered under a group Medicare
6     supplement policy. Continuation shall not be available for
7     any enrollee who is covered by any other insured or
8     uninsured plan that provides hospital, surgical, or
9     medical coverage for individuals in a group and under which
10     the enrollee was not covered immediately before
11     termination or reduction in hours below the minimum
12     required by the group contract or who exercises his or her
13     conversion privilege under the group policy.
14         (3) Continuation need not include dental, vision care,
15     prescription drug, or similar supplementary benefits that
16     are provided under the group contract in addition to its
17     basic health care services.
18         (4) Upon termination or reduction in hours below the
19     minimum required by the group contract, written notice of
20     continuation shall be presented to the employee or member
21     and the HMO by the employer or mailed by the employer to
22     the last known address of the employee. With respect to an
23     employee or member who is terminated or whose reduction in
24     hours below the minimum required by the group occurs after
25     the effective date of this amendatory Act of the 96th
26     General Assembly, this written notice must be given

 

 

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1     directly to the employee or member or sent via certified
2     mail within 10 days after the employee's or member's
3     termination or reduction in hours below the minimum
4     required by the group plan. An employee or member who
5     wishes continuation of coverage must request continuation
6     in writing within the 30 10 day period following the later
7     of (i) the date of termination or reduction in hours below
8     the minimum required by the group contract or (ii) the date
9     the employee is given written notice of the right of
10     continuation by either the employer, or the group
11     policyholder, or HMO. The written notice provided to an
12     employee or member who is terminated or whose reduction in
13     hours below the minimum required by the group occurs after
14     the effective date of this amendatory Act of the 96th
15     General Assembly must include an explanation that his or
16     her option for continuation coverage will expire within the
17     30 day period following the later of (i) the date of such
18     termination of employment or reduction in hours below the
19     minimum required by the group plan or (ii) the date the
20     employee is given written notice of the right of
21     continuation by either the employer, group policyholder,
22     or HMO. In no event, however, shall the employee or member
23     elect continuation more than 60 days after the date of
24     termination or reduction in hours below the minimum
25     required by the group contract. Written notice of
26     continuation presented to the employee or member by the

 

 

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1     policyholder or HMO, or mailed by the policyholder or HMO
2     to the last known address of the employee, shall constitute
3     the giving of notice for the purpose of this paragraph.
4         
5         In the event the employer fails or refuses to provide
6     notice of continuation rights to the employee or member,
7     the HMO is required to mail notice of the continuation
8     rights to the employee or member at the last known address
9     of the employee. In the event the employee or member
10     contacts the HMO regarding continuation rights and advises
11     that notice has not been provided by the employer or group
12     policyholder, the HMO shall mail out notice to that
13     individual. An employee or member shall have 30 days from
14     receipt of the notice to elect continuation.
15         (4a) Unless contrary to the provisions of, or any rules
16     promulgated pursuant to, Section 3001(a)(7) of Title III of
17     Division B of the federal American Recovery and
18     Reinvestment Act of 2009, with respect to employees or
19     members of health plans that are subject solely to State
20     continuation coverage and who are terminated or whose
21     reduction in hours below the minimum required by the group
22     occurs between the effective date of this amendatory Act of
23     the 96th General Assembly and December 31, 2009, the notice
24     requirements of this Section are not satisfied unless
25     notice is presented to the employee or member by the HMO
26     informing the employee or member of the availability of

 

 

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1     premium reduction with respect to such coverage under the
2     American Recovery and Reinvestment Act of 2009. Such
3     written notice shall conform to all applicable
4     requirements set forth in Section 3001(a)(7) of Title III
5     of Division B of the federal American Recovery and
6     Reinvestment Act of 2009. The Department shall publish
7     models for the notification that shall be provided by HMOs
8     pursuant to this paragraph (4a).
9         (4b) Unless contrary to the provisions of, or any rules
10     promulgated pursuant to, Section 3001(a)(7) of Title III of
11     Division B of the federal American Recovery and
12     Reinvestment Act of 2009, with respect to employees or
13     members of health plans that are subject solely to State
14     continuation coverage who were terminated or whose
15     reduction in hours below the minimum required by the group
16     occurred between September 1, 2008, and the effective date
17     of this amendatory Act of the 96th General Assembly and who
18     have an election of continuation of coverage pursuant to
19     this Section in effect, notice shall be presented to the
20     employee or member by the HMO informing the employee or
21     member of the availability of premium reduction with
22     respect to such coverage under the American Recovery and
23     Reinvestment Act of 2009. Such written notice shall conform
24     to all applicable requirements set forth in Section
25     3001(a)(7) of Title III of Division B of the federal
26     American Recovery and Reinvestment Act of 2009 and shall be

 

 

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1     sent to the employee or member within 14 days of the
2     effective date of this amendatory Act of the 96th General
3     Assembly. The Department shall publish models for the
4     notification that shall be provided by HMOs pursuant to
5     this paragraph (4b).
6         (5) An employee or member electing continuation must
7     pay to the group policyholder or his employer, on a monthly
8     basis in advance, the total amount of premium required by
9     the HMO, including that portion of the premium contributed
10     by the policyholder or employer, if any, but not more than
11     the group rate for the coverage being continued with
12     appropriate reduction in premium for any supplementary
13     benefits that have been discontinued under paragraph (3) of
14     this Section. The premium rate required by the HMO shall be
15     the applicable premium required on the due date of each
16     payment.
17         (6) Continuation of coverage under the group contract
18     for any person shall terminate when the person becomes
19     eligible for Medicare or is covered by any other insured or
20     uninsured plan that provides hospital, surgical, or
21     medical coverage for individuals in a group and under which
22     the person was not covered immediately before termination
23     or reduction in hours below the minimum required by the
24     group contract as provided in paragraph (2) of this Section
25     or, if earlier, at the first to occur of the following:
26             (a) The expiration of 12 9 months after the

 

 

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1         employee's or member's coverage because of termination
2         of employment or membership or reduction in hours below
3         the minimum required by the group contract.
4             (b) If the employee or member fails to make timely
5         payment of a required contribution, the end of the
6         period for which contributions were made.
7             (c) The date on which the group contract is
8         terminated or, in the case of an employee, the date his
9         or her employer terminates participation under the
10         group contract. If, however, this paragraph applies
11         and the coverage ceasing by reason of termination is
12         replaced by similar coverage under another group
13         contract, then (i) the employee or member shall have
14         the right to become covered under the replacement group
15         contract for the balance of the period that he or she
16         would have remained covered under the prior group
17         contract in accordance with paragraph (6) had a
18         termination described in this item (c) not occurred and
19         (ii) the prior group contract shall continue to provide
20         benefits to the extent of its accrued liabilities and
21         extensions of benefits as if the replacement had not
22         occurred.
23         (7) A notification of the continuation privilege shall
24     be included in each evidence of coverage.
25         (8) Continuation shall not be available for any
26     employee who was discharged because of the commission of a

 

 

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1     felony in connection with his or her work, or because of
2     theft in connection with his or her work, for which the
3     employer was in no way responsible if the employee (i)
4     admitted to committing the felony or theft or (ii) was
5     convicted or placed under supervision by a court of
6     competent jurisdiction.
7         (9) An employee or member without an election of
8     continuation of coverage pursuant to this Section in effect
9     on the effective date of this amendatory Act of the 96th
10     General Assembly may elect continuation pursuant to this
11     paragraph (9) if the employee or member: (i) would be an
12     assistance eligible individual as defined in Section
13     3001(a)(3) of Title III of Division B of the federal
14     American Recovery and Reinvestment Act of 2009 if such an
15     election were in effect and (ii) at the time of termination
16     was eligible for continuation pursuant to paragraphs (1)
17     and (2) of this Section.
18         Unless contrary to the provisions of, or any rules
19     promulgated pursuant to, Section 3001(a)(7) of Title III of
20     Division B of the federal American Recovery and
21     Reinvestment Act of 2009, written notice of continuation
22     pursuant to this paragraph (9) shall be presented to the
23     employee or member by the HMO or mailed by the HMO to the
24     last known address of the employee or member within 30 days
25     after effective date of this amendatory Act of the 96th
26     General Assembly. The written notice shall conform to all

 

 

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1     applicable requirements set forth in section 3001(a)(7) of
2     Title III of Division B of the federal American Recovery
3     and Reinvestment Act of 2009. The Department shall publish
4     models for the notification that shall be provided by HMOs
5     pursuant to this paragraph (9).
6         An employee or member electing continuation of
7     coverage under this paragraph (9) must request such
8     continuation in writing within 60 days after the date the
9     employee or member receives written notice of the right of
10     continuation by the HMO.
11         Continuation of coverage elected pursuant to this
12     paragraph (9) shall commence with the first period of
13     coverage beginning on or after February 17, 2009, the
14     effective date of the federal American Recovery and
15     Reinvestment Act of 2009, and shall not extend beyond the
16     period of continuation that would have been required if the
17     coverage had been elected pursuant to paragraph (4) of this
18     Section.
19         With respect to an employee or member who elects
20     continuation of coverage under this paragraph (9), the
21     period beginning on the date of the employee or member's
22     involuntary termination of employment and ending on the
23     date of the first period of coverage on or after February
24     17, 2009 shall be disregarded for purposes of determining
25     the 63-day period referred to in Section 20 of the Illinois
26     Health Insurance Portability and Accountability Act.

 

 

09600HB2325sam001 - 20 - LRB096 09782 RPM 26158 a

1     The requirements of this amendatory Act of 1992 shall apply
2 to any group contract, as defined in this Section, delivered or
3 issued for delivery on or after 180 days following the
4 effective date of this amendatory Act of 1992.
5 (Source: P.A. 93-477, eff. 1-1-04.)
 
6     Section 99. Effective date. This Act takes effect upon
7 becoming law.".