State of Illinois
90th General Assembly

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[ Introduced ][ Engrossed ][ Senate Amendment 001 ]
[ Conference Committee Report 001 ]


      215 ILCS 105/5            from Ch. 73, par. 1305
          Amends  the  Comprehensive  Health  Insurance  Plan  Act.
      Provides that the  Plan  shall  be  administered  by  a  plan
      administrator rather than an administering carrier.  Provides
      that  criteria  for bids to administer the Plan shall include
      disclosure of discounts or income that may be derived by  the
      Plan  and  the  timeliness  of  claim  processing procedures.
      Effective July 1, 1997.
HB1400 Enrolled                                LRB9002243JSgc
 1        AN ACT concerning  health  insurance  coverage,  amending
 2    named Acts.
 3        Be  it  enacted  by  the People of the State of Illinois,
 4    represented in the General Assembly:
 5        Section 5.  The Illinois Health Insurance Portability and
 6    Accountability  Act  is  amended  by  adding  Section  50  as
 7    follows:
 8        (215 ILCS 97/50 new)
 9        Sec. 50.  Guaranteed renewability  of  individual  health
10    insurance coverage.
11        (A)  In  general.   Except as provided in this Section, a
12    health  insurance  issuer  that  provides  individual  health
13    insurance coverage to an individual shall renew  or  continue
14    in force such coverage at the option of the individual.
15        (B)  General  exceptions.   A health insurance issuer may
16    nonrenew or  discontinue  health  insurance  coverage  of  an
17    individual in the individual market based only on one or more
18    of the following:
19             (1)  Nonpayment  of  premiums.   The  individual has
20        failed to pay premiums  or  contributions  in  accordance
21        with  the  terms  of the health insurance coverage or the
22        issuer has not received timely premium payments.
23             (2)  Fraud.  The individual has performed an act  or
24        practice  that  constitutes  fraud or made an intentional
25        misrepresentation of material fact under the terms of the
26        coverage.
27             (3)  Termination of plan.  The issuer is ceasing  to
28        offer  coverage  in  the  individual market in accordance
29        with  subsection  (C)  of  this  Section  and  applicable
30        Illinois law.
31             (4)  Movement outside the service area.  In the case
HB1400 Enrolled            -2-                 LRB9002243JSgc
 1        of a health insurance issuer that offers health insurance
 2        coverage in  the  market  through  a  network  plan,  the
 3        individual  no  longer  resides,  lives,  or works in the
 4        service area (or in an  area  for  which  the  issuer  is
 5        authorized  to do business), but only if such coverage is
 6        terminated under this paragraph uniformly without  regard
 7        to   any   health   status-related   factor   of  covered
 8        individuals.
 9             (5)  Association membership ceases.  In the case  of
10        health  insurance  coverage that is made available in the
11        individual market only through  one  or  more  bona  fide
12        associations,  the  membership  of  the individual in the
13        association (on  the  basis  of  which  the  coverage  is
14        provided) ceases, but only if such coverage is terminated
15        under  this  paragraph  uniformly  without  regard to any
16        health status-related factor of covered individuals.
17        (C)  Requirements for uniform termination of coverage.
18             (1)  Particular type of coverage  not  offered.   In
19        any  case  in  which  an  issuer  decides  to discontinue
20        offering a particular type of health  insurance  coverage
21        offered  in  the individual market, coverage of such type
22        may be discontinued by the issuer only if:
23                  (a)  the issuer provides notice to each covered
24             individual provided coverage of this  type  in  such
25             market  of  such  discontinuation  at  least 90 days
26             prior to the date of  the  discontinuation  of  such
27             coverage;
28                  (b)  the  issuer  offers, to each individual in
29             the individual  market  provided  coverage  of  this
30             type,  the  option  to purchase any other individual
31             health insurance coverage currently being offered by
32             the issuer for individuals in such market; and
33                  (c)  in exercising the  option  to  discontinue
34             coverage  of that type and in offering the option of
HB1400 Enrolled            -3-                 LRB9002243JSgc
 1             coverage under subparagraph  (b),  the  issuer  acts
 2             uniformly    without    regard    to    any   health
 3             status-related factor  of  enrolled  individuals  or
 4             individuals   who   may  become  eligible  for  such
 5             coverage.
 6             (2)  Discontinuance of all coverage.
 7                  (a)  In general.  Subject to subparagraph  (c),
 8             in  any  case  in  which  a  health insurance issuer
 9             elects to discontinue offering all health  insurance
10             coverage  in  the  individual  market  in  Illinois,
11             health insurance coverage may be discontinued by the
12             issuer only if:
13                       (i)  the  issuer  provides  notice  to the
14                  Director  and  to  each   individual   of   the
15                  discontinuation  at least 180 days prior to the
16                  date of the expiration of such coverage; and
17                       (ii)  all  health  insurance   issued   or
18                  delivered  for  issuance  in  Illinois  in such
19                  market is discontinued and coverage under  such
20                  health insurance coverage in such market is not
21                  renewed.
22                  (b)  Prohibition  on  market  reentry.   In the
23             case of a discontinuation under subparagraph (a)  in
24             the  individual  market,  the issuer may not provide
25             for the issuance of any health insurance coverage in
26             Illinois involved during the 5-year period beginning
27             on the date  of  the  discontinuation  of  the  last
28             health insurance coverage not so renewed.
29        (D)  Exception  for uniform modification of coverage.  At
30    the time of coverage renewal, a health insurance  issuer  may
31    modify  the  health  insurance  coverage  for  a  policy form
32    offered to individuals in the individual market  so  long  as
33    the   modification   is  consistent  with  Illinois  law  and
34    effective on a uniform basis among all individuals with  that
HB1400 Enrolled            -4-                 LRB9002243JSgc
 1    policy form.
 2        (E)  Application   to   coverage   offered  only  through
 3    associations.  In applying this Section in the case of health
 4    insurance  coverage  that  is  made  available  by  a  health
 5    insurance issuer in the individual market to individuals only
 6    through  one  or  more  associations,  a  reference   to   an
 7    "individual"  is  deemed  to  include  a reference to such an
 8    association (of which the individual is a member).
 9        Section 10.  The Comprehensive Health Insurance Plan  Act
10    is amended by changing Sections 5 and 12 as follows:
11        (215 ILCS 105/5) (from Ch. 73, par. 1305)
12        Sec. 5.  Plan administrator Administering Carrier.
13        a.  The  board  shall  select  a  plan  administrator  an
14    administering  carrier  through a competitive bidding process
15    to administer  the  plan.   The  board  shall  evaluate  bids
16    submitted under this Section based on criteria established by
17    the board which shall include:
18        (1)  The  administrator's  carrier's  proven  ability  to
19    handle other large group accident and health benefit plans.
20        (2)  The efficiency and timeliness of the administrator's
21    carrier's claim processing paying procedures.
22        (3)  An   estimate   of   total   net  cost  charges  for
23    administering the plan, including any discounts or income the
24    Plan could expect to receive or benefit from.
25        (4)  The administrator's ability to apply effective  cost
26    containment  programs  and  procedures  and of the carrier to
27    administer the plan in a cost-efficient manner.
28        (5)  The  financial  condition  and  stability   of   the
29    administrator carrier.
30        b.  The  plan  administrator  administering carrier shall
31    serve for a period of 5 years subject to  removal  for  cause
32    and  subject  to the terms, conditions and limitations of the
HB1400 Enrolled            -5-                 LRB9002243JSgc
 1    contract  between  the  board  and  the  plan   administrator
 2    administering  carrier.   At  least  one  year  prior  to the
 3    expiration of each 5 year period of service  by  the  current
 4    plan  administrator an administering carrier, the board shall
 5    begin to advertise for and accept bids to serve as  the  plan
 6    administrator administering carrier for the succeeding 5 year
 7    period.   Selection  of  the plan administrator administering
 8    carrier for the succeeding period shall be made  at  least  6
 9    months prior to the end of the current 5 year period.
10        c.  The  plan  administrator  administering carrier shall
11    perform such eligibility and  administrative  claims  payment
12    functions  relating  to  the  plan  as  may be assigned to it
13    including:
14        (1)  The establishment  of  administering  carrier  shall
15    establish  a  premium  billing  procedure  for  collection of
16    premiums from plan participants.  Billings shall be made on a
17    periodic basis as determined by the board.
18        (2)  Processing of claims and  various  cost  containment
19    functions.
20        (3) (2)  Other  The  administering  carrier shall perform
21    all necessary functions to assure timely payment of  benefits
22    to participants under the plan, including:
23        (a)  Making  available information relating to the proper
24    manner of submitting a claim for benefits under the plan  and
25    distributing forms upon which submissions shall be made.
26        (b)  Evaluating the eligibility of each claim for payment
27    under the plan.
28        (c)  The  administrator  administering  carrier  shall be
29    governed by the requirements of Part 919 of Title 50  of  the
30    Illinois  Administrative  Code, promulgated by the Department
31    of Insurance, regarding the handling  of  claims  under  this
32    Act.
33        d.  The  administrator administering carrier shall submit
34    regular reports to the board regarding the operation  of  the
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 1    plan.  The frequency, content and form of the report shall be
 2    as determined by the board.
 3        e.  The  administrator administering carrier shall pay or
 4    be reimbursed for claims expenses from the  premium  payments
 5    received  from  or  on  behalf  of  plan participants. If the
 6    administrator's   administering   carrier's    payments    or
 7    reimbursements  for  claims  expenses  exceed  the portion of
 8    premiums  allocated  by  the  board  for  payment  of  claims
 9    expenses,  the  board  shall  provide  to  the  administering
10    carrier additional funds to the administrator for payment  or
11    reimbursement of such claims expenses.
12        f.  The administrator administering carrier shall be paid
13    as provided in the board's contract between the Board and the
14    plan   administrator   with  the  administering  carrier  for
15    expenses incurred in the performance of its services.
16    (Source: P.A. 85-1013.)
17        (215 ILCS 105/12) (from Ch. 73, par. 1312)
18        Sec. 12.  Deficit or surplus.
19        a.  If premiums or other receipts by the Board exceed the
20    amount required for the  operation  of  the  Plan,  including
21    actual  losses  and  administrative expenses of the Plan, the
22    Board shall direct that the excess be held at interest, in  a
23    bank designated by the Board, or used to offset future losses
24    or  to  reduce  Plan  premiums.  In this subsection, the term
25    "future  losses"  includes  reserves  for  incurred  but  not
26    reported claims.
27        b.  Any deficit incurred or expected to  be  incurred  on
28    behalf  of  eligible  persons  who  qualify for plan coverage
29    under  Section  7  of  this  Act  shall  be  recouped  by  an
30    appropriation made by the General Assembly.
31        c.  For the purposes of this Section, a deficit shall  be
32    incurred   when  anticipated  losses  and  incurred  but  not
33    reported  claims  expenses  exceed  anticipated  income  from
HB1400 Enrolled            -7-                 LRB9002243JSgc
 1    earned premiums net of administrative expenses.
 2        d.  Any deficit incurred or expected to  be  incurred  on
 3    behalf of federally eligible individuals who qualify for Plan
 4    coverage under Section 15 of this Act shall be recouped by an
 5    assessment  of  all  insurers  made  in  accordance  with the
 6    provisions of this Section.  The Board shall within  90  days
 7    of  the  effective  date  of  this amendatory Act of 1997 and
 8    within the first  quarter  of  each  fiscal  year  thereafter
 9    assess all insurers for the anticipated deficit in accordance
10    with the provisions of this Section.  The board may also make
11    additional  assessments  no  more than 4 times a year to fund
12    unanticipated deficits,  implementation  expenses,  and  cash
13    flow needs.
14        e.  An   insurer's  assessment  shall  be  determined  by
15    multiplying the total assessment, as determined in subsection
16    d. of this Section, by a fraction,  the  numerator  of  which
17    equals  that  insurer's  direct  Illinois premiums during the
18    preceding calendar year and the denominator of  which  equals
19    the  total  of  all  insurers' direct Illinois premiums.  The
20    Board may exempt those insurers  whose  share  as  determined
21    under  this  subsection  would be so minimal as to not exceed
22    the estimated cost of levying the assessment.
23        f.  The Board shall charge and collect from each  insurer
24    the  amounts  determined  to  be due under this Section.  The
25    assessment shall be billed by Board invoice  based  upon  the
26    insurer's  direct  Illinois  premium  income  as shown in its
27    annual statement for the preceding  calendar  year  as  filed
28    with the Director.  The invoice shall be due upon receipt and
29    must  be  paid  no  later  than  30 days after receipt by the
30    insurer.
31        g.  When an insurer fails to pay the full amount  of  any
32    assessment of $100 or more due under this Section there shall
33    be added to the amount due as a penalty the greater of $50 or
34    an  amount  equal  to  5% of the deficiency for each month or
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 1    part of a month that the deficiency remains unpaid.
 2        h.  Amounts collected under this Section shall be paid to
 3    the Board for  deposit  into  the  Plan  Fund  authorized  by
 4    Section 3 of this Act.
 5        i.  An insurer may petition the Director for an abatement
 6    or  deferment  of all or part of an assessment imposed by the
 7    Board.  The Director may abate or defer, in whole or in part,
 8    the assessment if, in the opinion of the Director, payment of
 9    the assessment would endanger the ability of the  insurer  to
10    fulfill   its  contractual  obligations.   In  the  event  an
11    assessment against an insurer is abated or deferred in  whole
12    or  in  part, the amount by which the assessment is abated or
13    deferred shall be assessed against the other  insurers  in  a
14    manner consistent with the basis for assessments set forth in
15    this  subsection.   The  insurer  receiving a deferment shall
16    remain liable to the plan for the deficiency for 4 years.
17        j.  The board shall establish procedures  for  appeal  by
18    any  insurer  subject to assessment pursuant to this Section.
19    Such procedures shall require that:
20             (1)  Any insurer that wishes to appeal  all  or  any
21        part of an assessment made pursuant to this Section shall
22        first  pay  the  amount of the assessment as set forth in
23        the  invoice  provided  by  the  board  within  the  time
24        provided in subsection f.  of  this  Section.  The  board
25        shall  hold  such payments in a separate interest-bearing
26        account. The payments shall be accompanied by a statement
27        in writing that the payment is  made  under  appeal.  The
28        statement  shall  specify the grounds for the appeal. The
29        insurer may be represented in its appeal  by  counsel  or
30        other representative of its choosing.
31             (2)  Within  90  days  following  the  payment of an
32        assessment under appeal by any insurer, the  board  shall
33        notify  the  insurer  or representative designated by the
34        insurer in writing of its determination with  respect  to
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 1        the  appeal and the basis or bases for that determination
 2        unless the Board notifies the insurer that  a  reasonable
 3        amount  of  additional  time  is  required to resolve the
 4        issues raised by the appeal.
 5             (3)  The board  shall  refer  to  the  Director  any
 6        question concerning the amount of direct Illinois premium
 7        income  as shown in an insurer's annual statement for the
 8        preceding calendar year on file with the Director on  the
 9        invoice  date  of the assessment.  Unless additional time
10        is required to resolve the question, the  Director  shall
11        within  60  days  report  to  the  board  in  writing his
12        determination respecting the amount  of  direct  Illinois
13        premium  income  on  file  on  the  invoice  date  of the
14        assessment.
15             (4)  In the event  the  board  determines  that  the
16        insurer is entitled to a refund, the refund shall be paid
17        within  30  days  following the date upon which the board
18        makes  its  determination,  together  with  the   accrued
19        interest.  Interest on any refund due an insurer shall be
20        paid at the rate actually earned  by  the  Board  on  the
21        separate account.
22             (5)  The  amount  of  any  such refund shall then be
23        assessed against all insurers in a manner consistent with
24        the basis for assessment as otherwise authorized by  this
25        Section.
26             (6)  The  board's  determination with respect to any
27        appeal received pursuant to this subsection  shall  be  a
28        final administrative decision as defined in Section 3-101
29        of  the  Code  of Civil Procedure.  The provisions of the
30        Administrative Review Law shall apply to and  govern  all
31        proceedings    for   the   judicial   review   of   final
32        administrative decisions of the board.
33             (7)  If an insurer fails to appeal an assessment  in
34        accordance  with  the  provisions of this subsection, the
HB1400 Enrolled            -10-                LRB9002243JSgc
 1        insurer shall be deemed  to  have  waived  its  right  of
 2        appeal.
 3        The   provisions   of   this   subsection  apply  to  all
 4    assessments made in any calendar  year  ending  on  or  after
 5    December 31, 1997.
 6    (Source: P.A. 90-30, eff. 7-1-97.)
 7        Section  15.  The  Health  Care  Purchasing  Group Act is
 8    amended by changing Sections 5, 10, 35, 40,  45,  and  65  as
 9    follows:
10        (215 ILCS 123/5)
11        Sec.   5.   Purpose;  applicability  of  Illinois  Health
12    Insurance Portability and Accountability Act.
13        (a)  The purpose and intent of this Act is  to  authorize
14    the  formation,  operation,  and  regulation  of  health care
15    purchasing groups (referred to in  this  Act  as  "HPGs")  as
16    described  by  this Act, to authorize the sale and regulation
17    of health insurance products for employers that are  sold  to
18    HPGs,  and to encourage the development of financially secure
19    and cost effective markets for the basic health care needs of
20    employers, employees, and their  dependents  in  this  State.
21    Nothing in this Act authorizes an employer to join with other
22    employers to self-insure through risk pooling.
23        (b)  All health insurance contracts issued under this Act
24    are  subject to the Illinois Health Insurance Portability and
25    Accountability Act.
26    (Source: P.A. 90-337, eff. 1-1-98.)
27        (215 ILCS 123/10)
28        Sec. 10. Definitions. Words and phrases As used  in  this
29    Act,  unless  defined  in  this  Section,  have  the meanings
30    attributed to them  in  Section  5  of  the  Illinois  Health
31    Insurance Portability and Accountability Act.:
HB1400 Enrolled            -11-                LRB9002243JSgc
 1        "Director" means the Director of Insurance.
 2        "Employee"  means a person who works on a full-time basis
 3    for the employer, with a normal week of 30 or more hours, and
 4    has satisfied any applicable waiting periods  for  insurance.
 5    "Employee" may also include a sole proprietor, a partner of a
 6    partnership,   a   retired   employee,   or   an  independent
 7    contractor, provided the sole  proprietor,  partner,  retired
 8    employee,   or  independent  contractor  is  included  as  an
 9    employee under a health benefit plan  of  the  employer.   It
10    does  not  need  to  include  an  employee  who  works  on  a
11    part-time, temporary, seasonal, or substitute basis.
12        "Employer"  may  include any legal form of doing business
13    or  employing  people,   including   a   self-employed   sole
14    proprietor.
15        "Health  benefit  plan"  means  any  hospital  or medical
16    expense-incurred policy or certificate, hospital  or  medical
17    service  plan  contract,  or  health maintenance organization
18    subscriber contract. Health benefit plan shall not include  a
19    policy  or  certificate of individual, accident-only, credit,
20    dental,  vision,  medicare  supplement,  hospital  indemnity,
21    specified  disease,  long  term  care  or  disability  income
22    insurance, coverage  issued  as  a  supplement  to  liability
23    insurance,  workers'  compensation  or  similar insurance, or
24    automobile medical payment insurance.
25        "Health insurance  contract",  "group  or  master  health
26    insurance  contract"  and  "insurance"  refer to the forms of
27    insurance obligations which a  "risk-bearer"  as  defined  in
28    this Section has been authorized to issue.
29        "Late  enrollee"  means  an  employee  or  dependent  who
30    requests  enrollment  in a health benefit plan of an employer
31    following the initial  enrollment  period  during  which  the
32    individual  is  entitled  to  enroll  under  the terms of the
33    health  insurance  contract,  provided   that   the   initial
34    enrollment  period is a period of at least 30 days.  However,
HB1400 Enrolled            -12-                LRB9002243JSgc
 1    an employee or dependent  shall  not  be  considered  a  late
 2    enrollee if:
 3        (1)  The individual meets each of the following:
 4             (A)  the   individual  was  covered  under  a  prior
 5        employer based health benefit plan at  the  time  of  the
 6        initial enrollment;
 7             (B)  the  individual  lost coverage under qualifying
 8        previous  coverage  as  a  result   of   termination   of
 9        employment or eligibility, the involuntary termination of
10        the  qualifying  previous  coverage, death of a spouse or
11        divorce; and
12             (C)  the individual requests  enrollment  within  30
13        days  after  the  termination  of the qualifying previous
14        coverage;
15        (2)  the individual  is  employed  by  an  employer  that
16    offers   multiple   health  insurance  alternatives  and  the
17    individual  elects  a  different  coverage  during  an   open
18    enrollment period; or
19        (3)  a  court  has  ordered  coverage  be  provided for a
20    spouse or minor or dependent child under a covered employee's
21    health insurance contract and request for enrollment is  made
22    within 30 days after issuance of the court order.
23        "Preexisting  condition" means a condition that, during a
24    period of no more than 12 months  immediately  preceding  the
25    effective date of coverage, had manifested itself in a manner
26    that would cause an ordinarily prudent person to seek medical
27    advice,  diagnosis,  care, or treatment, or for which medical
28    advice, diagnosis, care,  or  treatment  was  recommended  or
29    received.
30        "Risk-bearer" means an insurance company licensed in this
31    State  and  authorized  to  transact  the  kinds  of business
32    described in clause (b) of Class 1 and clause (a) of Class  2
33    of  Section  4  of  the  Illinois Insurance Code and entities
34    authorized under the Health Maintenance Organization Act.
HB1400 Enrolled            -13-                LRB9002243JSgc
 1    (Source: P.A. 90-337, eff. 1-1-98.)
 2        (215 ILCS 123/35)
 3        Sec. 35. Underwriting provisions.  All  health  insurance
 4    contracts  issued  under  this  Act  shall  be subject to the
 5    portability  and  preexisting  condition  provisions  of  the
 6    Illinois Health Insurance Portability and Accountability Act.
 7    following provisions, as applicable:
 8             (1)  Preexisting condition  limitation:   No  health
 9        insurance   contract  or  certificate  issued  under  the
10        contract  shall  exclude  or   limit   coverage   for   a
11        preexisting  condition for a period beyond 12 months from
12        the effective date of a person's coverage.
13             (2)  Portability of coverage:  Preexisting condition
14        limitation periods shall  be  reduced  to  the  extent  a
15        person  was  covered  under a prior employer-based health
16        benefit plan, notwithstanding the benefit levels  of  the
17        prior plan, if:
18                  (A)  the person is not a late enrollee; and
19                  (B)  the  prior  coverage  was  continuous to a
20             date not more than 30 days prior  to  the  effective
21             date   of   the   new  coverage,  exclusive  of  any
22             applicable waiting period.
23             (3)  If  a  risk-bearer  offers   coverage   to   an
24        employer, the  risk-bearer shall offer coverage to all of
25        the  employees  of  an  employer and their dependents.  A
26        risk-bearer shall not  offer  coverage  to  only  certain
27        individuals  of  an employer group, except in the case of
28        late enrollees.
29             (4)  As to employees to whom portability  provisions
30        do  not  apply,  a  risk-bearer shall not modify a health
31        insurance contract or certificate thereunder with respect
32        to an employer or any employee  or  dependent,  except  a
33        risk-bearer  may restrict or exclude coverage or benefits
HB1400 Enrolled            -14-                LRB9002243JSgc
 1        for a specific condition  for  a  maximum  period  of  12
 2        months  from  the  effective  date  of  the employee's or
 3        dependant's coverage by way of rider or endorsement.   As
 4        to   employees   to  whom  the  portability  of  coverage
 5        provisions apply, no riders or endorsements may reduce or
 6        limit benefits to be provided under  the  portability  of
 7        coverage provisions.
 8    (Source: P.A. 90-337, eff. 1-1-98.)
 9        (215 ILCS 123/40)
10        Sec.  40.  Renewability.   All health insurance contracts
11    issued  under  this  Act  are  subject  to  the  renewability
12    provisions of the Illinois Health Insurance  Portability  and
13    Accountability Act.
14        (a)  A  health  insurance  contract  subject  to this Act
15    shall be renewable with respect to all insured  employees  or
16    dependents,  at  the option of the HPG or employer, whichever
17    is a party to the master health insurance contract, except in
18    any of the following cases:
19             (1)  nonpayment of required premiums;
20             (2)  fraud or misrepresentation of the employer  or,
21        with  respect  to  coverage  of  individual insureds, the
22        insureds or their representatives;
23             (3)  noncompliance with  the  risk-bearer's  minimum
24        participation requirements;
25             (4)  noncompliance  with  the risk-bearer's employer
26        contribution requirements;
27             (5)  noncompliance with contract provisions;
28             (6)  repeated   misuse   of   a   provider   network
29        provision;
30             (7)  the risk-bearer elects to non-renew all of  its
31        health   insurance  contracts  delivered  or  issued  for
32        delivery to HPGs or employers under this Act; or
33             (8)  the Director finds that the continuation of the
HB1400 Enrolled            -15-                LRB9002243JSgc
 1        coverage would:
 2                  (A)  Not be in the best interests of the policy
 3             holders or certificate holders; or
 4                  (B)  Impair the risk-bearer's ability  to  meet
 5             its contractual obligations.
 6        (b)  A  risk-bearer  that  elects  not  to renew a health
 7    insurance contract under item (7)  of  subsection  (a)  shall
 8    provide  notice  of the decision not to renew coverage to all
 9    affected employers and to the official in charge of insurance
10    regulation  in  each  state  in  which  an  affected  insured
11    individual is known to reside at least 180 days prior to  the
12    nonrenewal   of   any   health   insurance  contract  by  the
13    risk-bearer. Notice to an official  in  charge  of  insurance
14    regulation   under this subsection shall be provided at least
15    3 working days before the notice to the  affected  employers.
16    Further, the risk-bearer shall be prohibited from writing new
17    business under this Act for a period of 5 years from the date
18    of notice to the Director.
19    (Source: P.A. 90-337, eff. 1-1-98.)
20        (215 ILCS 123/45)
21        Sec.  45. Disclosure requirements. In connection with the
22    offering  for  sale  of  any  health  insurance  contract  or
23    certificate under  the  contract  to  an  HPG  sponsor,  HPG,
24    employer, and employee, a risk-bearer shall make a reasonable
25    disclosure,  as  part of its solicitation and sales materials
26    of all of the following:
27        (1)  the provisions of  the  health  insurance  contracts
28    concerning  the  risk-bearer's  right to change premium rates
29    and the factors, other than  claim  experience,  that  affect
30    changes in premium rates;
31        (2)  that the rating restrictions contained in Section 30
32    of  the  Small  Employer Rating, Renewability and Portability
33    Health  Insurance  Act  are  not  applicable  to  the  health
HB1400 Enrolled            -16-                LRB9002243JSgc
 1    insurance contract being offered;
 2        (2)(3)  the  provisions  relating  to   renewability   of
 3    policies and contracts;
 4        (3)(4)  the   provisions   relating  to  any  preexisting
 5    condition provision; and
 6        (4)(5)  the   provisions    relating    to    portability
 7    provisions.
 8    (Source: P.A. 90-337, eff. 1-1-98.)
 9        (215 ILCS 123/65)
10        Sec. 65. Fees.
11        (a)  The  Director shall charge, collect, and give proper
12    acquittance for the payment all fees  provided  for  by  this
13    Act,  except  that  any Illinois corporations licensed by the
14    Department of Insurance pursuant to  the  provisions  of  the
15    Illinois  Insurance  Code,  the  Dental Service Plan Act, the
16    Health  Maintenance  Organization  Act,  the  Limited  Health
17    Service Organization Act, the Vision Service Plan Act and the
18    Voluntary Health Services Plans Act or licensed  as  a  third
19    party  administrator or as a managing general agent is exempt
20    from the registration fee imposed under this Act.
21        (b)  Any funds collected under  provisions  of  this  Act
22    shall  be  deposited in the Insurance Producer Administration
23    Fund treated in the manner provided  in  subsection  (11)  of
24    Section 408 of the Illinois Insurance Code.
25    (Source: P.A. 90-337, eff. 1-1-98.)
26        (215 ILCS 123/50 rep.)
27        Section  20.  The  Health  Care  Purchasing  Group Act is
28    amended by repealing Section 50.
29        Section 99.  Effective date.  This Act takes effect  upon
30    becoming law.

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