Illinois General Assembly - Full Text of SB2885
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Full Text of SB2885  97th General Assembly


Sen. Kwame Raoul

Filed: 4/17/2012





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2    AMENDMENT NO. ______. Amend Senate Bill 2885, AS AMENDED,
3by replacing everything after the enacting clause with the
5    "Section 5. The Health Care Purchasing Group Act is amended
6by changing Sections 10 and 15 as follows:
7    (215 ILCS 123/10)
8    Sec. 10. Definitions. Words and phrases used in this Act,
9unless defined in this Section, have the meanings attributed to
10them in Section 5 of the Illinois Health Insurance Portability
11and Accountability Act.
12    "Director" means the Director of Insurance.
13    "Employer" means an individual, sole proprietorship,
14partnership, firm, corporation, association, or any other
15legal entity that has one or more employees and is legally
16doing business in this State. "Employer" includes employers as



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1defined in the Illinois Health Insurance Portability and
2Accountability Act.
3    "Health insurance contract", "group or master health
4insurance contract" and "insurance" refer to the forms of
5insurance obligations which a "risk-bearer" as defined in this
6Section has been authorized to issue.
7    "Risk-bearer" means an insurance company licensed in this
8State and authorized to transact the kinds of business
9described in clause (b) of Class 1 and clause (a) of Class 2 of
10Section 4 of the Illinois Insurance Code and entities
11authorized under the Health Maintenance Organization Act.
12(Source: P.A. 90-337, eff. 1-1-98; 90-567, eff. 1-23-98.)
13    (215 ILCS 123/15)
14    Sec. 15. Health care purchasing groups; membership;
16    (a) An HPG may be an organization formed by 2 or more
17employers with no more than 2,500 500 covered employees each,
18an HPG sponsor or a risk-bearer for purposes of contracting for
19health insurance under this Act to cover employees and
20dependents of HPG members. An HPG shall not be prevented from
21supplementing health insurance coverage purchased under this
22Act by contracting for services from entities licensed and
23authorized in Illinois to provide those services under the
24Dental Service Plan Act, the Limited Health Service
25Organization Act, or Voluntary Health Services Plans Act. An



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1HPG may be a separate legal entity or simply a group of 2 or
2more employers with no more than 2,500 500 covered employees
3each aggregated under this Act by an HPG sponsor or risk-bearer
4for insurance purposes. There shall be no limit as to the
5number of HPGs that may operate in any geographic area of the
6State. No insurance risk may be borne or retained by the HPG.
7All health insurance contracts issued to the HPG must be
8delivered or issued for delivery in Illinois.
9    (b) Members of an HPG must be Illinois domiciled employers,
10except that an employer domiciled elsewhere may become a member
11of an Illinois HPG for the sole purpose of insuring its
12employees whose place of employment is located within this
13State. HPG membership may include employers having no more than
142,500 500 covered employees each.
15    (c) If an HPG is formed by any 2 or more employers with no
16more than 2,500 500 covered employees each, it shall utilize a
17licensed insurance producer is authorized to negotiate,
18solicit, market, obtain proposals for, and enter into group or
19master health insurance contracts on behalf of its members and
20their employees and employee dependents so long as it meets all
21of the following requirements:
22        (1) The HPG must be an organization having the legal
23    capacity to contract and having its legal situs in
24    Illinois.
25        (2) The principal persons responsible for the conduct
26    of the HPG must perform their HPG related functions in



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1    Illinois.
2        (3) No HPG may collect premium in its name or hold or
3    manage premium or claim fund accounts unless duly licensed
4    and qualified as a managing general agent pursuant to
5    Section 141a of the Illinois Insurance Code or a third
6    party administrator pursuant to Section 511.105 of the
7    Illinois Insurance Code.
8        (4) If the HPG gives an offer, application, notice, or
9    proposal of insurance to an employer, it must disclose to
10    that employer the total cost of the insurance. Dues, fees,
11    or charges to be paid to the HPG, HPG sponsor, or any other
12    entity as a condition to purchasing the insurance must be
13    itemized. The HPG shall also disclose to its members the
14    amount of any dividends, experience refunds, or other such
15    payments it receives from the risk-bearer.
16        (5) An HPG must register with the Director before
17    entering into a group or master health insurance contract
18    on behalf of its members and must renew the registration
19    annually on forms and at times prescribed by the Director
20    in rules specifying, at minimum, (i) the identity of the
21    officers and directors, trustees, or attorney-in-fact of
22    the HPG; (ii) a certification that those persons have not
23    been convicted of any felony offense involving a breach of
24    fiduciary duty or improper manipulation of accounts; and
25    (iii) the number of employer members then enrolled in the
26    HPG, together with any other information that may be needed



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1    to carry out the purposes of this Act.
2        (6) At the time of initial registration and each
3    renewal thereof an HPG shall pay a fee of $100 to the
4    Director.
5    (d) If an HPG is formed by an HPG sponsor or risk-bearer
6and the HPG performs no marketing, negotiation, solicitation,
7or proposing of insurance to HPG members, exclusive of
8ministerial acts performed by individual employers to service
9their own employees, then a group or master health insurance
10contract may be issued in the name of the HPG and held by an HPG
11sponsor, risk-bearer, or designated employer member within the
12State. In these cases the HPG requirements specified in
13subsection (c) shall not be applicable, however:
14        (1) the group or master health insurance contract must
15    contain a provision permitting the contract to be enforced
16    through legal action initiated by any employer member or by
17    an employee of an HPG member who has paid premium for the
18    coverage provided;
19        (2) the group or master health insurance contract must
20    be available for inspection and copying by any HPG member,
21    employee, or insured dependent at a designated location
22    within the State at all normal business hours; and
23        (3) any information concerning HPG membership required
24    by rule under item (5) of subsection (c) must be provided
25    by the HPG sponsor in its registration and renewal forms or
26    by the risk-bearer in its annual reports.



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1(Source: P.A. 90-337, eff. 1-1-98; 90-655, eff. 7-30-98;
291-617, eff. 1-1-00.)".