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90_SB0149
215 ILCS 5/356t new
215 ILCS 125/5-3 from Ch. 111 1/2, par. 1411.2
215 ILCS 130/3009 from Ch. 73, par. 1503-9
215 ILCS 165/10 from Ch. 32, par. 604
Amends the Illinois Insurance Code, Health Maintenance
Organization Act, Limited Health Service Organization Act,
and Voluntary Health Services Plans Act. Provides that
coverage under those Acts for breast cancer must include
coverage for high-dose chemotherapy with autologous bone
marrow transplantation.
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1 AN ACT in relation to insurance coverage for breast
2 cancer, amending 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 Insurance Code is amended by
6 adding Section 356t as follows:
7 (215 ILCS 5/356t new)
8 Sec. 356t. Breast cancer coverage. An individual or
9 group policy of accident and health insurance amended,
10 delivered, issued, or renewed after the effective date of
11 this amendatory Act of 1997 must provide coverage for the
12 treatment of breast cancer by high-dose chemotherapy with
13 autologous bone marrow transplantation and for expenses
14 arising from the treatment. Coverage under this Section may
15 not be subject to any greater coinsurance, copayment, or
16 deductible than that applicable for any other coverage under
17 the policy.
18 Section 10. The Health Maintenance Organization Act is
19 amended by changing Section 5-3 as follows:
20 (215 ILCS 125/5-3) (from Ch. 111 1/2, par. 1411.2)
21 Sec. 5-3. Insurance Code provisions.
22 (a) Health Maintenance Organizations shall be subject to
23 the provisions of Sections 133, 134, 137, 140, 141.1, 141.2,
24 141.3, 143, 143c, 147, 148, 149, 151, 152, 153, 154, 154.5,
25 154.6, 154.7, 154.8, 155.04, 355.2, 356m, 356t, 367i, 401,
26 401.1, 402, 403, 403A, 408, 408.2, and 412, paragraph (c) of
27 subsection (2) of Section 367, and Articles VIII 1/2, XII,
28 XII 1/2, XIII, XIII 1/2, and XXVI of the Illinois Insurance
29 Code.
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1 (b) For purposes of the Illinois Insurance Code, except
2 for Articles XIII and XIII 1/2, Health Maintenance
3 Organizations in the following categories are deemed to be
4 "domestic companies":
5 (1) a corporation authorized under the Medical
6 Service Plan Act, the Dental Service Plan Act, the Vision
7 Service Plan Act, the Pharmaceutical Service Plan Act,
8 the Voluntary Health Services Plan Act, or the Nonprofit
9 Health Care Service Plan Act;
10 (2) a corporation organized under the laws of this
11 State; or
12 (3) a corporation organized under the laws of
13 another state, 30% or more of the enrollees of which are
14 residents of this State, except a corporation subject to
15 substantially the same requirements in its state of
16 organization as is a "domestic company" under Article
17 VIII 1/2 of the Illinois Insurance Code.
18 (c) In considering the merger, consolidation, or other
19 acquisition of control of a Health Maintenance Organization
20 pursuant to Article VIII 1/2 of the Illinois Insurance Code,
21 (1) the Director shall give primary consideration
22 to the continuation of benefits to enrollees and the
23 financial conditions of the acquired Health Maintenance
24 Organization after the merger, consolidation, or other
25 acquisition of control takes effect;
26 (2)(i) the criteria specified in subsection (1)(b)
27 of Section 131.8 of the Illinois Insurance Code shall not
28 apply and (ii) the Director, in making his determination
29 with respect to the merger, consolidation, or other
30 acquisition of control, need not take into account the
31 effect on competition of the merger, consolidation, or
32 other acquisition of control;
33 (3) the Director shall have the power to require
34 the following information:
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1 (A) certification by an independent actuary of
2 the adequacy of the reserves of the Health
3 Maintenance Organization sought to be acquired;
4 (B) pro forma financial statements reflecting
5 the combined balance sheets of the acquiring company
6 and the Health Maintenance Organization sought to be
7 acquired as of the end of the preceding year and as
8 of a date 90 days prior to the acquisition, as well
9 as pro forma financial statements reflecting
10 projected combined operation for a period of 2
11 years;
12 (C) a pro forma business plan detailing an
13 acquiring party's plans with respect to the
14 operation of the Health Maintenance Organization
15 sought to be acquired for a period of not less than
16 3 years; and
17 (D) such other information as the Director
18 shall require.
19 (d) The provisions of Article VIII 1/2 of the Illinois
20 Insurance Code and this Section 5-3 shall apply to the sale
21 by any health maintenance organization of greater than 10% of
22 its enrollee population (including without limitation the
23 health maintenance organization's right, title, and interest
24 in and to its health care certificates).
25 (e) In considering any management contract or service
26 agreement subject to Section 141.1 of the Illinois Insurance
27 Code, the Director (i) shall, in addition to the criteria
28 specified in Section 141.2 of the Illinois Insurance Code,
29 take into account the effect of the management contract or
30 service agreement on the continuation of benefits to
31 enrollees and the financial condition of the health
32 maintenance organization to be managed or serviced, and (ii)
33 need not take into account the effect of the management
34 contract or service agreement on competition.
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1 (f) Except for small employer groups as defined in the
2 Small Employer Rating, Renewability and Portability Health
3 Insurance Act and except for medicare supplement policies as
4 defined in Section 363 of the Illinois Insurance Code, a
5 Health Maintenance Organization may by contract agree with a
6 group or other enrollment unit to effect refunds or charge
7 additional premiums under the following terms and conditions:
8 (i) the amount of, and other terms and conditions
9 with respect to, the refund or additional premium are set
10 forth in the group or enrollment unit contract agreed in
11 advance of the period for which a refund is to be paid or
12 additional premium is to be charged (which period shall
13 not be less than one year); and
14 (ii) the amount of the refund or additional premium
15 shall not exceed 20% of the Health Maintenance
16 Organization's profitable or unprofitable experience with
17 respect to the group or other enrollment unit for the
18 period (and, for purposes of a refund or additional
19 premium, the profitable or unprofitable experience shall
20 be calculated taking into account a pro rata share of the
21 Health Maintenance Organization's administrative and
22 marketing expenses, but shall not include any refund to
23 be made or additional premium to be paid pursuant to this
24 subsection (f)). The Health Maintenance Organization and
25 the group or enrollment unit may agree that the
26 profitable or unprofitable experience may be calculated
27 taking into account the refund period and the immediately
28 preceding 2 plan years.
29 The Health Maintenance Organization shall include a
30 statement in the evidence of coverage issued to each enrollee
31 describing the possibility of a refund or additional premium,
32 and upon request of any group or enrollment unit, provide to
33 the group or enrollment unit a description of the method used
34 to calculate (1) the Health Maintenance Organization's
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1 profitable experience with respect to the group or enrollment
2 unit and the resulting refund to the group or enrollment unit
3 or (2) the Health Maintenance Organization's unprofitable
4 experience with respect to the group or enrollment unit and
5 the resulting additional premium to be paid by the group or
6 enrollment unit.
7 In no event shall the Illinois Health Maintenance
8 Organization Guaranty Association be liable to pay any
9 contractual obligation of an insolvent organization to pay
10 any refund authorized under this Section.
11 (Source: P.A. 88-313; 89-90, eff. 6-30-95.)
12 Section 15. The Limited Health Service Organization Act
13 is amended by changing Section 3009 as follows:
14 (215 ILCS 130/3009) (from Ch. 73, par. 1503-9)
15 Sec. 3009. Point-of-service limited health service
16 contracts.
17 (a) An LHSO that offers a POS contract:
18 (1) shall include as in-plan covered services all
19 services required by law to be provided by an LHSO;
20 (2) shall provide incentives, which shall include
21 financial incentives, for enrollees to use in-plan
22 covered services;
23 (3) shall not offer services out-of-plan without
24 providing those services on an in-plan basis;
25 (4) may limit or exclude specific types of services
26 from coverage when obtained out-of-plan;
27 (5) may include annual out-of-pocket limits and
28 lifetime maximum benefits allowances for out-of-plan
29 services that are separate from any limits or allowances
30 applied to in-plan services;
31 (6) shall include an annual maximum benefit
32 allowance not to exceed $2,500 per year that is separate
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1 from any limits or allowances applied to in-plan
2 services;
3 (7) may limit the groups to which a POS product is
4 offered, however, if a POS product is offered to a group,
5 then it must be offered to all eligible members of that
6 group, when an LHSO provider is available;
7 (8) shall not consider emergency services,
8 authorized referral services, or non-routine services
9 obtained out of the service area to be POS services; and
10 (9) may treat as out-of-plan services those
11 services that an enrollee obtains from a participating
12 provider, but for which the proper authorization was not
13 given by the LHSO.
14 (b) An LHSO offering a POS contract shall be subject to
15 the following limitations:
16 (1) The LHSO shall not expend in any calendar
17 quarter more than 20% of its total limited health
18 services expenditures for all its members for out-of-plan
19 covered services.
20 (2) If the amount specified in paragraph (1) is
21 exceeded by 2% in a quarter, the LHSO shall effect
22 compliance with paragraph (1) by the end of the following
23 quarter.
24 (3) If compliance with the amount specified in
25 paragraph (1) is not demonstrated in the LHSO's next
26 quarterly report, the LHSO may not offer the POS contract
27 to new groups or include the POS option in the renewal of
28 an existing group until compliance with the amount
29 specified in paragraph (1) is demonstrated or otherwise
30 allowed by the Director.
31 (4) Any LHSO failing, without just cause, to comply
32 with the provisions of this subsection shall be required,
33 after notice and hearing, to pay a penalty of $250 for
34 each day out of compliance, to be recovered by the
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1 Director of Insurance. Any penalty recovered shall be
2 paid into the General Revenue Fund. The Director may
3 reduce the penalty if the LHSO demonstrates to the
4 Director that the imposition of the penalty would
5 constitute a financial hardship to the LHSO.
6 (c) Any LHSO that offers a POS product shall:
7 (1) File a quarterly financial statement detailing
8 compliance with the requirements of subsection (b).
9 (2) Track out-of-plan POS utilization separately
10 from in-plan or non-POS out-of-plan emergency care,
11 referral care, and urgent care out of the service area
12 utilization.
13 (3) Record out-of-plan utilization in a manner that
14 will permit such utilization and cost reporting as the
15 Director may, by regulation, require.
16 (4) Demonstrate to the Director's satisfaction that
17 the LHSO has the fiscal, administrative, and marketing
18 capacity to control its POS enrollment, utilization, and
19 costs so as not to jeopardize the financial security of
20 the LHSO.
21 (5) Maintain the deposit required by subsection (b)
22 of Section 2006 in addition to any other deposit required
23 under this Act.
24 (d) An LHSO shall not issue a POS contract until it has
25 filed and had approved by the Director a plan to comply with
26 the provisions of this Section. The compliance plan shall at
27 a minimum include provisions demonstrating that the LHSO will
28 do all of the following:
29 (1) Design the benefit levels and conditions of
30 coverage for in-plan covered services and out-of-plan
31 covered services as required by this Article.
32 (2) Provide or arrange for the provision of
33 adequate systems to:
34 (A) process and pay claims for all out-of-plan
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1 covered services;
2 (B) meet the requirements for a POS contract
3 set forth in this Section and any additional
4 requirements that may be set forth by the Director;
5 and
6 (C) generate accurate data and financial and
7 regulatory reports on a timely basis so that the
8 Department can evaluate the LHSO's experience with
9 the POS contract and monitor compliance with POS
10 contract provisions.
11 (3) Comply initially and on an ongoing basis with
12 the requirements of subsections (b) and (c).
13 (e) A POS contract must comply with the requirements of
14 Section 356t of the Illinois Insurance Code.
15 (Source: P.A. 87-1079; 88-667, eff. 9-16-94.)
16 Section 20. The Voluntary Health Services Plans Act is
17 amended by changing Section 10 as follows:
18 (215 ILCS 165/10) (from Ch. 32, par. 604)
19 Sec. 10. Application of Insurance Code provisions.
20 Health services plan corporations and all persons interested
21 therein or dealing therewith shall be subject to the
22 provisions of Article XII 1/2 and Sections 3.1, 133, 140,
23 143, 143c, 149, 354, 355.2, 356r, 356t, 367.2, 401, 401.1,
24 402, 403, 403A, 408, 408.2, and 412, and paragraphs (7) and
25 (15) of Section 367 of the Illinois Insurance Code.
26 (Source: P.A. 89-514, eff. 7-17-96.)