Full Text of HB1530 97th General Assembly
HB1530sam003 97TH GENERAL ASSEMBLY | Sen. William Delgado Filed: 5/20/2011
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| 1 | | AMENDMENT TO HOUSE BILL 1530
| 2 | | AMENDMENT NO. ______. Amend House Bill 1530 by replacing | 3 | | everything after the enacting clause with the following:
| 4 | | "Section 5. The Illinois Insurance Code is amended by | 5 | | changing Section 370c and by adding Section 370c.1 as follows:
| 6 | | (215 ILCS 5/370c) (from Ch. 73, par. 982c)
| 7 | | Sec. 370c. Mental and emotional disorders.
| 8 | | (a) (1) On and after the effective date of this amendatory | 9 | | Act of the 97th General Assembly Section ,
every insurer which | 10 | | amends, delivers, issues, or renews delivers, issues for | 11 | | delivery or renews or modifies
group accident and health A&H | 12 | | policies providing coverage for hospital or medical treatment | 13 | | or
services for illness on an expense-incurred basis shall | 14 | | offer to the
applicant or group policyholder subject to the | 15 | | insurer's insurers standards of
insurability, coverage for | 16 | | reasonable and necessary treatment and services
for mental, |
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| 1 | | emotional or nervous disorders or conditions, other than | 2 | | serious
mental illnesses as defined in item (2) of subsection | 3 | | (b), consistent with the parity requirements of Section 370c.1 | 4 | | of this Code up to the limits
provided in the policy for other | 5 | | disorders or conditions, except (i) the
insured may be required | 6 | | to pay up to 50% of expenses incurred as a result
of the | 7 | | treatment or services, and (ii) the annual benefit limit may be
| 8 | | limited to the lesser of $10,000 or 25% of the lifetime policy | 9 | | limit .
| 10 | | (2) Each insured that is covered for mental, emotional , or | 11 | | nervous , or substance use
disorders or conditions shall be free | 12 | | to select the physician licensed to
practice medicine in all | 13 | | its branches, licensed clinical psychologist,
licensed | 14 | | clinical social worker, licensed clinical professional | 15 | | counselor, or licensed marriage and family therapist , licensed | 16 | | speech-language pathologist, or other licensed or certified | 17 | | professional at a program licensed pursuant to the Illinois | 18 | | Alcoholism and Other Drug Abuse and Dependency Act of
his | 19 | | choice to treat such disorders, and
the insurer shall pay the | 20 | | covered charges of such physician licensed to
practice medicine | 21 | | in all its branches, licensed clinical psychologist,
licensed | 22 | | clinical social worker, licensed clinical professional | 23 | | counselor, or licensed marriage and family therapist , licensed | 24 | | speech-language pathologist, or other licensed or certified | 25 | | professional at a program licensed pursuant to the Illinois | 26 | | Alcoholism and Other Drug Abuse and Dependency Act up
to the |
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| 1 | | limits of coverage, provided (i)
the disorder or condition | 2 | | treated is covered by the policy, and (ii) the
physician, | 3 | | licensed psychologist, licensed clinical social worker, | 4 | | licensed
clinical professional counselor, or licensed marriage | 5 | | and family therapist , licensed speech-language pathologist, or | 6 | | other licensed or certified professional at a program licensed | 7 | | pursuant to the Illinois Alcoholism and Other Drug Abuse and | 8 | | Dependency Act is
authorized to provide said services under the | 9 | | statutes of this State and in
accordance with accepted | 10 | | principles of his profession.
| 11 | | (3) Insofar as this Section applies solely to licensed | 12 | | clinical social
workers, licensed clinical professional | 13 | | counselors, and licensed marriage and family therapists, | 14 | | licensed speech-language pathologist, and other licensed or | 15 | | certified professionals at programs licensed pursuant to the | 16 | | Illinois Alcoholism and Other Drug Abuse and Dependency Act, | 17 | | those persons who may
provide services to individuals shall do | 18 | | so
after the licensed clinical social worker, licensed clinical | 19 | | professional
counselor, or licensed marriage and family | 20 | | therapist , licensed speech-language pathologist, or other | 21 | | licensed or certified professional at a program licensed | 22 | | pursuant to the Illinois Alcoholism and Other Drug Abuse and | 23 | | Dependency Act has informed the patient of the
desirability of | 24 | | the patient conferring with the patient's primary care
| 25 | | physician and the licensed clinical social worker, licensed | 26 | | clinical
professional counselor, or licensed marriage and |
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| 1 | | family therapist , licensed speech-language pathologist, or | 2 | | other licensed or certified professional at a program licensed | 3 | | pursuant to the Illinois Alcoholism and Other Drug Abuse and | 4 | | Dependency Act has
provided written
notification to the | 5 | | patient's primary care physician, if any, that services
are | 6 | | being provided to the patient. That notification may, however, | 7 | | be
waived by the patient on a written form. Those forms shall | 8 | | be retained by
the licensed clinical social worker, licensed | 9 | | clinical professional counselor, or licensed marriage and | 10 | | family therapist , licensed speech-language pathologist, or | 11 | | other licensed or certified professional at a program licensed | 12 | | pursuant to the Illinois Alcoholism and Other Drug Abuse and | 13 | | Dependency Act
for a period of not less than 5 years.
| 14 | | (b) (1) An insurer that provides coverage for hospital or | 15 | | medical
expenses under a group policy of accident and health | 16 | | insurance or
health care plan amended, delivered, issued, or | 17 | | renewed on or after the effective
date of this amendatory Act | 18 | | of the 97th 92nd General Assembly shall provide coverage
under | 19 | | the policy for treatment of serious mental illness and | 20 | | substance use disorders consistent with the parity | 21 | | requirements of Section 370c.1 of this Code under the same | 22 | | terms
and conditions as coverage for hospital or medical | 23 | | expenses related to other
illnesses and diseases. The coverage | 24 | | required under this Section must provide
for same durational | 25 | | limits, amount limits, deductibles, and co-insurance
| 26 | | requirements for serious mental illness as are provided for |
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| 1 | | other illnesses
and diseases . This subsection does not apply to | 2 | | any group policy of accident and health insurance or health | 3 | | care plan for any plan year of a small employer as defined in | 4 | | Section 5 of the Illinois Health Insurance Portability and | 5 | | Accountability Act coverage provided to
employees by employers | 6 | | who have 50 or fewer employees .
| 7 | | (2) "Serious mental illness" means the following | 8 | | psychiatric illnesses as
defined in the most current edition of | 9 | | the Diagnostic and Statistical Manual
(DSM) published by the | 10 | | American Psychiatric Association:
| 11 | | (A) schizophrenia;
| 12 | | (B) paranoid and other psychotic disorders;
| 13 | | (C) bipolar disorders (hypomanic, manic, depressive, | 14 | | and mixed);
| 15 | | (D) major depressive disorders (single episode or | 16 | | recurrent);
| 17 | | (E) schizoaffective disorders (bipolar or depressive);
| 18 | | (F) pervasive developmental disorders;
| 19 | | (G) obsessive-compulsive disorders;
| 20 | | (H) depression in childhood and adolescence;
| 21 | | (I) panic disorder; | 22 | | (J) post-traumatic stress disorders (acute, chronic, | 23 | | or with delayed onset); and
| 24 | | (K) anorexia nervosa and bulimia nervosa. | 25 | | (2.5) "Substance use disorder" means the following mental | 26 | | disorders as defined in the most current edition of the |
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| 1 | | Diagnostic and Statistical Manual (DSM) published by the | 2 | | American Psychiatric Association: | 3 | | (A) substance abuse disorders; | 4 | | (B) substance dependence disorders; and | 5 | | (C) substance induced disorders. | 6 | | (3) Unless otherwise prohibited by federal law and | 7 | | consistent with the parity requirements of Section 370c.1 of | 8 | | this Code, Upon request of the reimbursing insurer, a provider | 9 | | of treatment of
serious mental illness or substance use | 10 | | disorder shall furnish medical records or other necessary data
| 11 | | that substantiate that initial or continued treatment is at all | 12 | | times medically
necessary. An insurer shall provide a mechanism | 13 | | for the timely review by a
provider holding the same license | 14 | | and practicing in the same specialty as the
patient's provider, | 15 | | who is unaffiliated with the insurer, jointly selected by
the | 16 | | patient (or the patient's next of kin or legal representative | 17 | | if the
patient is unable to act for himself or herself), the | 18 | | patient's provider, and
the insurer in the event of a dispute | 19 | | between the insurer and patient's
provider regarding the | 20 | | medical necessity of a treatment proposed by a patient's
| 21 | | provider. If the reviewing provider determines the treatment to | 22 | | be medically
necessary, the insurer shall provide | 23 | | reimbursement for the treatment. Future
contractual or | 24 | | employment actions by the insurer regarding the patient's
| 25 | | provider may not be based on the provider's participation in | 26 | | this procedure.
Nothing prevents
the insured from agreeing in |
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| 1 | | writing to continue treatment at his or her
expense. When | 2 | | making a determination of the medical necessity for a treatment
| 3 | | modality for serious serous mental illness or substance use | 4 | | disorder , an insurer must make the determination in a
manner | 5 | | that is consistent with the manner used to make that | 6 | | determination with
respect to other diseases or illnesses | 7 | | covered under the policy, including an
appeals process. Medical | 8 | | necessity determinations for substance use disorders shall be | 9 | | made in accordance with appropriate patient placement criteria | 10 | | established by the American Society of Addiction Medicine.
| 11 | | (4) A group health benefit plan amended, delivered, issued, | 12 | | or renewed on or after the effective date of this amendatory | 13 | | Act of the 97th General Assembly :
| 14 | | (A) shall provide coverage based upon medical | 15 | | necessity for the following
treatment of mental illness and | 16 | | substance use disorders consistent with the parity | 17 | | requirements of Section 370c.1 of this Code; provided, | 18 | | however, that in each calendar year coverage shall not be | 19 | | less than the following :
| 20 | | (i) 45 days of inpatient treatment; and
| 21 | | (ii) beginning on June 26, 2006 (the effective date | 22 | | of Public Act 94-921), 60 visits for outpatient | 23 | | treatment including group and individual
outpatient | 24 | | treatment; and | 25 | | (iii) for plans or policies delivered, issued for | 26 | | delivery, renewed, or modified after January 1, 2007 |
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| 1 | | (the effective date of Public Act 94-906),
20 | 2 | | additional outpatient visits for speech therapy for | 3 | | treatment of pervasive developmental disorders that | 4 | | will be in addition to speech therapy provided pursuant | 5 | | to item (ii) of this subparagraph (A); and
| 6 | | (B) may not include a lifetime limit on the number of | 7 | | days of inpatient
treatment or the number of outpatient | 8 | | visits covered under the plan . ; and
| 9 | | (C) (Blank). shall include the same amount limits, | 10 | | deductibles, copayments, and
coinsurance factors for | 11 | | serious mental illness as for physical illness.
| 12 | | (5) An issuer of a group health benefit plan may not count | 13 | | toward the number
of outpatient visits required to be covered | 14 | | under this Section an outpatient
visit for the purpose of | 15 | | medication management and shall cover the outpatient
visits | 16 | | under the same terms and conditions as it covers outpatient | 17 | | visits for
the treatment of physical illness.
| 18 | | (6) An issuer of a group health benefit
plan may provide or | 19 | | offer coverage required under this Section through a
managed | 20 | | care plan.
| 21 | | (7) (Blank). This Section shall not be interpreted to | 22 | | require a group health benefit
plan to provide coverage for | 23 | | treatment of:
| 24 | | (A) an addiction to a controlled substance or cannabis | 25 | | that is used in
violation of law; or
| 26 | | (B) mental illness resulting from the use of a |
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| 1 | | controlled substance or
cannabis in violation of law.
| 2 | | (8)
(Blank).
| 3 | | (9) With respect to substance use disorders, coverage for | 4 | | inpatient treatment shall include coverage for treatment in a | 5 | | residential treatment center licensed by the Department of | 6 | | Public Health or the Department of Human Services, Division of | 7 | | Alcoholism and Substance Abuse. | 8 | | (c) This Section shall not be interpreted to require | 9 | | coverage for speech therapy or other habilitative services for | 10 | | those individuals covered under Section 356z.15
of this Code. | 11 | | (Source: P.A. 95-331, eff. 8-21-07; 95-972, eff. 9-22-08; | 12 | | 95-973, eff. 1-1-09; 95-1049, eff. 1-1-10; 96-328, eff. | 13 | | 8-11-09; 96-1000, eff. 7-2-10.) | 14 | | (215 ILCS 5/370c.1 new) | 15 | | Sec. 370c.1. Mental health parity. | 16 | | (a) On and after the effective date of this amendatory Act | 17 | | of the 97th General Assembly, every insurer that amends, | 18 | | delivers, issues, or renews a group policy of accident and | 19 | | health insurance in this State providing coverage for hospital | 20 | | or medical treatment and for the treatment of mental, | 21 | | emotional, nervous, or substance use disorders or conditions | 22 | | shall ensure that: | 23 | | (1) the financial requirements applicable to such | 24 | | mental, emotional, nervous, or substance use disorder or | 25 | | condition benefits are no more restrictive than the |
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| 1 | | predominant financial requirements applied to | 2 | | substantially all hospital and medical benefits covered by | 3 | | the policy and that there are no separate cost-sharing | 4 | | requirements that are applicable only with respect to | 5 | | mental, emotional, nervous, or substance use disorder or | 6 | | condition benefits; and | 7 | | (2) the treatment limitations applicable to such | 8 | | mental, emotional, nervous, or substance use disorder or | 9 | | condition benefits are no more restrictive than the | 10 | | predominant treatment limitations applied to substantially | 11 | | all hospital and medical benefits covered by the policy and | 12 | | that there are no separate treatment limitations that are | 13 | | applicable only with respect to mental, emotional, | 14 | | nervous, or substance use disorder or condition benefits. | 15 | | (b) The following provisions shall apply concerning | 16 | | aggregate lifetime limits: | 17 | | (1) In the case of a group policy of accident and | 18 | | health insurance amended, delivered, issued, or renewed in | 19 | | this State on or after the effective date of this | 20 | | amendatory Act of the 97th General Assembly that provides | 21 | | coverage for hospital or medical treatment and for the | 22 | | treatment of mental, emotional, nervous, or substance use | 23 | | disorders or conditions the following provisions shall | 24 | | apply: | 25 | | (A) if the policy does not include an aggregate | 26 | | lifetime limit on substantially all hospital and |
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| 1 | | medical benefits, then the policy may not impose any | 2 | | aggregate lifetime limit on mental, emotional, | 3 | | nervous, or substance use disorder or condition | 4 | | benefits; or | 5 | | (B) if the policy includes an aggregate lifetime | 6 | | limit on substantially all hospital and medical | 7 | | benefits (in this subsection referred to as the | 8 | | "applicable lifetime limit"), then the policy shall | 9 | | either: | 10 | | (i) apply the applicable lifetime limit both | 11 | | to the hospital and medical benefits to which it | 12 | | otherwise would apply and to mental, emotional, | 13 | | nervous, or substance use disorder or condition | 14 | | benefits and not distinguish in the application of | 15 | | the limit between the hospital and medical | 16 | | benefits and mental, emotional, nervous, or | 17 | | substance use disorder or condition benefits; or | 18 | | (ii) not include any aggregate lifetime limit | 19 | | on mental, emotional, nervous, or substance use | 20 | | disorder or condition benefits that is less than | 21 | | the applicable lifetime limit. | 22 | | (2) In the case of a policy that is not described in | 23 | | paragraph (1) of subsection (b) of this Section and that | 24 | | includes no or different aggregate lifetime limits on | 25 | | different categories of hospital and medical benefits, the | 26 | | Director shall establish rules under which subparagraph |
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| 1 | | (B) of paragraph (1) of subsection (b) of this Section is | 2 | | applied to such policy with respect to mental, emotional, | 3 | | nervous, or substance use disorder or condition benefits by | 4 | | substituting for the applicable lifetime limit an average | 5 | | aggregate lifetime limit that is computed taking into | 6 | | account the weighted average of the aggregate lifetime | 7 | | limits applicable to such categories. | 8 | | (c) The following provisions shall apply concerning annual | 9 | | limits: | 10 | | (1) In the case of a group policy of accident and | 11 | | health insurance amended, delivered, issued, or renewed in | 12 | | this State on or after the effective date of this | 13 | | amendatory Act of the 97th General Assembly that provides | 14 | | coverage for hospital or medical treatment and for the | 15 | | treatment of mental, emotional, nervous, or substance use | 16 | | disorders or conditions the following provisions shall | 17 | | apply: | 18 | | (A) if the policy does not include an annual limit | 19 | | on substantially all hospital and medical benefits, | 20 | | then the policy may not impose any annual limits on | 21 | | mental, emotional, nervous, or substance use disorder | 22 | | or condition benefits; or | 23 | | (B) if the policy includes an annual limit on | 24 | | substantially all hospital and medical benefits (in | 25 | | this subsection referred to as the "applicable annual | 26 | | limit"), then the policy shall either: |
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| 1 | | (i) apply the applicable annual limit both to | 2 | | the hospital and medical benefits to which it | 3 | | otherwise would apply and to mental, emotional, | 4 | | nervous, or substance use disorder or condition | 5 | | benefits and not distinguish in the application of | 6 | | the limit between the hospital and medical | 7 | | benefits and mental, emotional, nervous, or | 8 | | substance use disorder or condition benefits; or | 9 | | (ii) not include any annual limit on mental, | 10 | | emotional, nervous, or substance use disorder or | 11 | | condition benefits that is less than the | 12 | | applicable annual limit. | 13 | | (2) In the case of a policy that is not described in | 14 | | paragraph (1) of subsection (c) of this Section and that | 15 | | includes no or different annual limits on different | 16 | | categories of hospital and medical benefits, the Director | 17 | | shall establish rules under which subparagraph (B) of | 18 | | paragraph (1) of subsection (c) of this Section is applied | 19 | | to such policy with respect to mental, emotional, nervous, | 20 | | or substance use disorder or condition benefits by | 21 | | substituting for the applicable annual limit an average | 22 | | annual limit that is computed taking into account the | 23 | | weighted average of the annual limits applicable to such | 24 | | categories. | 25 | | (d) This Section shall be interpreted in a manner | 26 | | consistent with the interim final regulations promulgated by |
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| 1 | | the U.S. Department of Health and Human Services at 75 FR 5410, | 2 | | including the prohibition against applying a cumulative | 3 | | financial requirement or cumulative quantitative treatment | 4 | | limitation for mental, emotional, nervous, or substance use | 5 | | disorder benefits that accumulates separately from any | 6 | | cumulative financial requirement or cumulative quantitative | 7 | | treatment limitation established for hospital and medical | 8 | | benefits in the same classification. | 9 | | (e) The provisions of subsections (b) and (c) of this | 10 | | Section shall not be interpreted to allow the use of lifetime | 11 | | or annual limits otherwise prohibited by State or federal law. | 12 | | (f) This Section shall not apply to individual health | 13 | | insurance coverage as defined in Section 5 of the Illinois | 14 | | Health Insurance Portability and Accountability Act. | 15 | | (g) As used in this Section: | 16 | | "Financial requirement" includes deductibles, copayments, | 17 | | coinsurance, and out-of-pocket maximums, but does not include | 18 | | an aggregate lifetime limit or an annual limit subject to | 19 | | subsections (b) and (c). | 20 | | "Treatment limitation" includes limits on benefits based | 21 | | on the frequency of treatment, number of visits, days of | 22 | | coverage, days in a waiting period, or other similar limits on | 23 | | the scope or duration of treatment. "Treatment limitation" | 24 | | includes both quantitative treatment limitations, which are | 25 | | expressed numerically (such as 50 outpatient visits per year), | 26 | | and nonquantitative treatment limitations, which otherwise |
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| 1 | | limit the scope or duration of treatment. A permanent exclusion | 2 | | of all benefits for a particular condition or disorder shall | 3 | | not be considered a treatment limitation. | 4 | | Section 10. The Health Maintenance Organization Act is | 5 | | amended by changing Section 5-3 as follows:
| 6 | | (215 ILCS 125/5-3) (from Ch. 111 1/2, par. 1411.2)
| 7 | | Sec. 5-3. Insurance Code provisions.
| 8 | | (a) Health Maintenance Organizations
shall be subject to | 9 | | the provisions of Sections 133, 134, 137, 140, 141.1,
141.2, | 10 | | 141.3, 143, 143c, 147, 148, 149, 151,
152, 153, 154, 154.5, | 11 | | 154.6,
154.7, 154.8, 155.04, 355.2, 356g.5-1, 356m, 356v, 356w, | 12 | | 356x, 356y,
356z.2, 356z.4, 356z.5, 356z.6, 356z.8, 356z.9, | 13 | | 356z.10, 356z.11, 356z.12, 356z.13, 356z.14, 356z.15, 356z.17, | 14 | | 356z.18, 364.01, 367.2, 367.2-5, 367i, 368a, 368b, 368c, 368d, | 15 | | 368e, 370c, 370c.1,
401, 401.1, 402, 403, 403A,
408, 408.2, | 16 | | 409, 412, 444,
and
444.1,
paragraph (c) of subsection (2) of | 17 | | Section 367, and Articles IIA, VIII 1/2,
XII,
XII 1/2, XIII, | 18 | | XIII 1/2, XXV, and XXVI of the Illinois Insurance Code.
| 19 | | (b) For purposes of the Illinois Insurance Code, except for | 20 | | Sections 444
and 444.1 and Articles XIII and XIII 1/2, Health | 21 | | Maintenance Organizations in
the following categories are | 22 | | deemed to be "domestic companies":
| 23 | | (1) a corporation authorized under the
Dental Service | 24 | | Plan Act or the Voluntary Health Services Plans Act;
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| 1 | | (2) a corporation organized under the laws of this | 2 | | State; or
| 3 | | (3) a corporation organized under the laws of another | 4 | | state, 30% or more
of the enrollees of which are residents | 5 | | of this State, except a
corporation subject to | 6 | | substantially the same requirements in its state of
| 7 | | organization as is a "domestic company" under Article VIII | 8 | | 1/2 of the
Illinois Insurance Code.
| 9 | | (c) In considering the merger, consolidation, or other | 10 | | acquisition of
control of a Health Maintenance Organization | 11 | | pursuant to Article VIII 1/2
of the Illinois Insurance Code,
| 12 | | (1) the Director shall give primary consideration to | 13 | | the continuation of
benefits to enrollees and the financial | 14 | | conditions of the acquired Health
Maintenance Organization | 15 | | after the merger, consolidation, or other
acquisition of | 16 | | control takes effect;
| 17 | | (2)(i) the criteria specified in subsection (1)(b) of | 18 | | Section 131.8 of
the Illinois Insurance Code shall not | 19 | | apply and (ii) the Director, in making
his determination | 20 | | with respect to the merger, consolidation, or other
| 21 | | acquisition of control, need not take into account the | 22 | | effect on
competition of the merger, consolidation, or | 23 | | other acquisition of control;
| 24 | | (3) the Director shall have the power to require the | 25 | | following
information:
| 26 | | (A) certification by an independent actuary of the |
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| 1 | | adequacy
of the reserves of the Health Maintenance | 2 | | Organization sought to be acquired;
| 3 | | (B) pro forma financial statements reflecting the | 4 | | combined balance
sheets of the acquiring company and | 5 | | the Health Maintenance Organization sought
to be | 6 | | acquired as of the end of the preceding year and as of | 7 | | a date 90 days
prior to the acquisition, as well as pro | 8 | | forma financial statements
reflecting projected | 9 | | combined operation for a period of 2 years;
| 10 | | (C) a pro forma business plan detailing an | 11 | | acquiring party's plans with
respect to the operation | 12 | | of the Health Maintenance Organization sought to
be | 13 | | acquired for a period of not less than 3 years; and
| 14 | | (D) such other information as the Director shall | 15 | | require.
| 16 | | (d) The provisions of Article VIII 1/2 of the Illinois | 17 | | Insurance Code
and this Section 5-3 shall apply to the sale by | 18 | | any health maintenance
organization of greater than 10% of its
| 19 | | enrollee population (including without limitation the health | 20 | | maintenance
organization's right, title, and interest in and to | 21 | | its health care
certificates).
| 22 | | (e) In considering any management contract or service | 23 | | agreement subject
to Section 141.1 of the Illinois Insurance | 24 | | Code, the Director (i) shall, in
addition to the criteria | 25 | | specified in Section 141.2 of the Illinois
Insurance Code, take | 26 | | into account the effect of the management contract or
service |
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| 1 | | agreement on the continuation of benefits to enrollees and the
| 2 | | financial condition of the health maintenance organization to | 3 | | be managed or
serviced, and (ii) need not take into account the | 4 | | effect of the management
contract or service agreement on | 5 | | competition.
| 6 | | (f) Except for small employer groups as defined in the | 7 | | Small Employer
Rating, Renewability and Portability Health | 8 | | Insurance Act and except for
medicare supplement policies as | 9 | | defined in Section 363 of the Illinois
Insurance Code, a Health | 10 | | Maintenance Organization may by contract agree with a
group or | 11 | | other enrollment unit to effect refunds or charge additional | 12 | | premiums
under the following terms and conditions:
| 13 | | (i) the amount of, and other terms and conditions with | 14 | | respect to, the
refund or additional premium are set forth | 15 | | in the group or enrollment unit
contract agreed in advance | 16 | | of the period for which a refund is to be paid or
| 17 | | additional premium is to be charged (which period shall not | 18 | | be less than one
year); and
| 19 | | (ii) the amount of the refund or additional premium | 20 | | shall not exceed 20%
of the Health Maintenance | 21 | | Organization's profitable or unprofitable experience
with | 22 | | respect to the group or other enrollment unit for the | 23 | | period (and, for
purposes of a refund or additional | 24 | | premium, the profitable or unprofitable
experience shall | 25 | | be calculated taking into account a pro rata share of the
| 26 | | Health Maintenance Organization's administrative and |
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| 1 | | marketing expenses, but
shall not include any refund to be | 2 | | made or additional premium to be paid
pursuant to this | 3 | | subsection (f)). The Health Maintenance Organization and | 4 | | the
group or enrollment unit may agree that the profitable | 5 | | or unprofitable
experience may be calculated taking into | 6 | | account the refund period and the
immediately preceding 2 | 7 | | plan years.
| 8 | | The Health Maintenance Organization shall include a | 9 | | statement in the
evidence of coverage issued to each enrollee | 10 | | describing the possibility of a
refund or additional premium, | 11 | | and upon request of any group or enrollment unit,
provide to | 12 | | the group or enrollment unit a description of the method used | 13 | | to
calculate (1) the Health Maintenance Organization's | 14 | | profitable experience with
respect to the group or enrollment | 15 | | unit and the resulting refund to the group
or enrollment unit | 16 | | or (2) the Health Maintenance Organization's unprofitable
| 17 | | experience with respect to the group or enrollment unit and the | 18 | | resulting
additional premium to be paid by the group or | 19 | | enrollment unit.
| 20 | | In no event shall the Illinois Health Maintenance | 21 | | Organization
Guaranty Association be liable to pay any | 22 | | contractual obligation of an
insolvent organization to pay any | 23 | | refund authorized under this Section.
| 24 | | (g) Rulemaking authority to implement Public Act 95-1045, | 25 | | if any, is conditioned on the rules being adopted in accordance | 26 | | with all provisions of the Illinois Administrative Procedure |
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| 1 | | Act and all rules and procedures of the Joint Committee on | 2 | | Administrative Rules; any purported rule not so adopted, for | 3 | | whatever reason, is unauthorized. | 4 | | (Source: P.A. 95-422, eff. 8-24-07; 95-520, eff. 8-28-07; | 5 | | 95-876, eff. 8-21-08; 95-958, eff. 6-1-09; 95-978, eff. 1-1-09; | 6 | | 95-1005, eff. 12-12-08; 95-1045, eff. 3-27-09; 95-1049, eff. | 7 | | 1-1-10; 96-328, eff. 8-11-09; 96-639, eff. 1-1-10; 96-833, eff. | 8 | | 6-1-10; 96-1000, eff. 7-2-10.)
| 9 | | Section 99. Effective date. This Act takes effect upon | 10 | | becoming law.".
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