Rep. Karen May
Filed: 2/23/2012
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1 | AMENDMENT TO HOUSE BILL 3976
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2 | AMENDMENT NO. ______. Amend House Bill 3976 by replacing | ||||||
3 | everything after the enacting clause with the following:
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4 | "Section 5. The Illinois Insurance Code is amended by | ||||||
5 | adding Section 44.1 as follows: | ||||||
6 | (215 ILCS 5/44.1 new) | ||||||
7 | Sec. 44.1. Health insurance cooperatives. | ||||||
8 | (a) In addition to all other provisions of this Article not | ||||||
9 | in conflict with this Section, an entity seeking to organize | ||||||
10 | under this Article as a health insurance cooperative shall meet | ||||||
11 | all of the following requirements: | ||||||
12 | (1) The entity shall comply with all provisions | ||||||
13 | applicable to domestic mutual insurance companies under | ||||||
14 | this Code. | ||||||
15 | (2) The articles of incorporation of the entity shall | ||||||
16 | demonstrate that the entity is to be organized as a |
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1 | nonprofit member corporation and that the governance of the | ||||||
2 | entity shall be subject to a majority vote of all members. | ||||||
3 | (3) The activities of the entity shall include, but not | ||||||
4 | be limited to, the issuance of health care plans in the | ||||||
5 | individual and small group markets. | ||||||
6 | (4) Either the articles of incorporation or the bylaws | ||||||
7 | of the entity shall incorporate ethics and conflict of | ||||||
8 | interest standards and the governance requirements set | ||||||
9 | forth in Section 1322(c)(3)(C) of the federal Patient | ||||||
10 | Protection and Affordable Care Act. | ||||||
11 | (5) The entity or a related entity or any predecessor | ||||||
12 | of either shall not have been a health insurance issuer on | ||||||
13 | July 16, 2009. | ||||||
14 | (6) The entity shall not be sponsored by a State or | ||||||
15 | local government, any political subdivision thereof, or | ||||||
16 | any instrumentality of such government or political | ||||||
17 | subdivision. | ||||||
18 | (7) Surplus shall be used to lower premiums, to improve | ||||||
19 | benefits, or for other programs intended to improve the | ||||||
20 | quality of health care delivered to its members. | ||||||
21 | (8) No representative of a federal, State, or local | ||||||
22 | government, or any political instrumentality thereof, and | ||||||
23 | no representative of an entity described in paragraph (5) | ||||||
24 | of subsection (a) of this Section may serve on the board of | ||||||
25 | directors of the cooperative. | ||||||
26 | (b) Notwithstanding Section 37 of this Article, the |
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1 | corporate name of any organization seeking to organize under | ||||||
2 | this Article as a health insurance cooperative need not contain | ||||||
3 | the word "Mutual" but shall contain the phrase "Health | ||||||
4 | Insurance Cooperative". The corporate name shall not be the | ||||||
5 | same as, or deceptively similar to, the name of any domestic | ||||||
6 | organization or of any foreign or alien organization authorized | ||||||
7 | to transact business in this State. | ||||||
8 | (c) An entity seeking to be organized as a health insurance | ||||||
9 | cooperative shall submit an application to the Director | ||||||
10 | according to procedures and meeting such requirements as the | ||||||
11 | Director shall adopt by rule. No entity shall transact any | ||||||
12 | business of insurance until it has received a certificate of | ||||||
13 | authority as set forth in Section 51 of this Article. | ||||||
14 | (d) The Department may adopt rules for the administration | ||||||
15 | of the provisions of this Section. | ||||||
16 | Section 10. The Co-operative Act is amended by changing | ||||||
17 | Section 22 and by adding Section 30 as follows:
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18 | (805 ILCS 310/22) (from Ch. 32, par. 326)
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19 | Sec. 22. No corporation or association hereafter organized | ||||||
20 | or doing
business for profit in this State shall be entitled to | ||||||
21 | use the term
"Co-operative" as a part of its corporate or other | ||||||
22 | business name or title
unless it has complied with the | ||||||
23 | provisions of this Act, except (1) a corporation
organized | ||||||
24 | under the Business Corporation Act of 1983 for the purpose of |
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1 | ownership or administration of residential property on
a | ||||||
2 | cooperative basis, or (2) a cooperative corporation organized | ||||||
3 | under the General Not For Profit Corporation Act of 1986 or its | ||||||
4 | predecessor or successor statutes , or (3) a domestic mutual | ||||||
5 | insurance company licensed as a health insurance cooperative by | ||||||
6 | the Director of Insurance under Article III of the Illinois | ||||||
7 | Insurance Code . Any corporation
or association violating the | ||||||
8 | provision of this Section may be enjoined from
doing business | ||||||
9 | under such name at the instance of any shareholder of any
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10 | association or corporation organized under this Act.
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11 | (Source: P.A. 95-368, eff. 8-23-07.)
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12 | (805 ILCS 310/30 new) | ||||||
13 | Sec. 30. Health insurance cooperative. | ||||||
14 | (a) Notwithstanding any other provisions of this Act, | ||||||
15 | health insurance cooperatives may be organized under this | ||||||
16 | Section by one or more persons. | ||||||
17 | (b) The purpose of a health insurance cooperative is to | ||||||
18 | provide health care benefits for the individuals specified in | ||||||
19 | subsection (h) of this Section as a risk-bearing entity. | ||||||
20 | (c) A health insurance cooperative shall be designed so | ||||||
21 | that all of the following are accomplished: | ||||||
22 | (1) The members become better informed about health | ||||||
23 | care trends and cost increases. | ||||||
24 | (2) All members receive their health care benefits | ||||||
25 | under the group health care policy or plan negotiated under |
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1 | subsection (h) of this Section. | ||||||
2 | (3) The members are actively engaged in designing | ||||||
3 | health care benefit options that are offered by the insurer | ||||||
4 | and that meet the needs of their community. | ||||||
5 | (4) The health insurance risk of all of the members is | ||||||
6 | pooled. | ||||||
7 | (5) The members actively participate in health | ||||||
8 | improvement decisions for their community. | ||||||
9 | (d) The articles of a health insurance cooperative shall | ||||||
10 | set forth the name and address of at least one incorporator who | ||||||
11 | will act as the temporary board. | ||||||
12 | (e) Each health insurance cooperative shall be organized on | ||||||
13 | a membership basis with no capital stock. | ||||||
14 | (f) Any person that does business in, is located in, has a | ||||||
15 | principal office in, or resides in the geographic area in which | ||||||
16 | a health insurance cooperative is organized, that meets the | ||||||
17 | membership criteria established by the health insurance | ||||||
18 | cooperative in its bylaws, and that pays the membership fee may | ||||||
19 | be a member of the health insurance cooperative. | ||||||
20 | (g) Each health insurance cooperative shall file its | ||||||
21 | membership criteria, as well as any amendments to the criteria, | ||||||
22 | with the Director. | ||||||
23 | (h) Eligible members of the health insurance cooperative | ||||||
24 | include: | ||||||
25 | (1) An individual who is a member, officer, or eligible | ||||||
26 | employee of a company or organization with 100 or fewer |
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1 | employees. | ||||||
2 | (2) A self-employed individual. | ||||||
3 | (3) A dependent of an individual under items (1) and | ||||||
4 | (2) of this subsection (h) who receives coverage. | ||||||
5 | (i) Each health insurance cooperative shall submit to the | ||||||
6 | Director annually, no later than September 30, a report on the | ||||||
7 | health insurance cooperative described in this Section. | ||||||
8 | (j) The membership contract between the health insurance
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9 | cooperative and the member shall be for a term of 3 years. Upon
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10 | membership enrollment in the health insurance cooperative,
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11 | each member shall pay to the health insurance cooperative a | ||||||
12 | membership fee of at least $250. If a member withdraws from the | ||||||
13 | health insurance cooperative before the end of the contract | ||||||
14 | term, the member shall not be eligible to rejoin the health | ||||||
15 | insurance cooperative for a period of at least one year, and | ||||||
16 | the
health insurance cooperative may retain, as a penalty,
the | ||||||
17 | membership fee. | ||||||
18 | (k) As used in this Section, "Director" means the Director | ||||||
19 | of Insurance.
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20 | Section 99. Effective date. This Act takes effect upon | ||||||
21 | becoming law.".
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