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90_SB0276
215 ILCS 125/2-1.1 new
215 ILCS 125/2-1.2 new
215 ILCS 125/2-1.3 new
215 ILCS 125/2-1.4 new
215 ILCS 125/2-1.5 new
215 ILCS 125/2-1.6 new
215 ILCS 125/2-1.7 new
215 ILCS 125/4-17 new
215 ILCS 125/Art. VII heading new
215 ILCS 125/7-1 new
215 ILCS 125/7-2 new
215 ILCS 125/7-3 new
215 ILCS 125/7-4 new
215 ILCS 125/7-5 new
215 ILCS 125/7-6 new
215 ILCS 125/7-7 new
215 ILCS 125/7-8 new
215 ILCS 125/7-9 new
215 ILCS 125/7-10 new
215 ILCS 125/7-11 new
Amends the Health Maintenance Organization Act. Imposes
certain requirements for holding a certificate of authority
under which health care services are provided through the use
of managed care, including disclosure standards,
credentialing standards and an appeals process for providers,
the development of community service plans, and that health
maintenance organizations provide a point-of-service option.
Provides for certification of utilization review agents by
the Department of Insurance. Establishes criteria for
obtaining a certificate. Requires the Director of Insurance
to establish a statewide dispute resolution system. Provides
penalties for violation. Effective immediately.
LRB9002231JSmg
LRB9002231JSmg
1 AN ACT concerning the regulation of health maintenance
2 organizations, amending a named Act.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The Health Maintenance Organization Act is
6 amended by adding Sections 2-1.1, 2-1.2, 2-1.3, 2-1.4, 2-1.5,
7 2-1.6, 2-1.7, and 4-17 and Article VII as follows:
8 (215 ILCS 125/2-1.1 new)
9 Sec. 2-1.1. Requirements for holding a certificate of
10 authority.
11 (a) In addition to any other requirements of this Act,
12 beginning January 1, 1998 and annually thereafter, as a
13 condition for holding a certificate of authority issued
14 pursuant to this Act under which health care services are
15 provided through the use of managed care, the Director shall
16 require the disclosure of the following information to each
17 enrollee or prospective enrollee, upon request:
18 (1) a description of premiums, co-payments,
19 co-insurance and deductibles, covered benefits,
20 exclusions and limitations, including experimental or
21 investigational coverage exclusions for treatment, drugs
22 or devices;
23 (2) a description of limitations on an insured's
24 choice of a primary and specialist or other participating
25 provider, including notice of any financial
26 responsibilities for an insured such as co-insurance or
27 other expenditures that result from such choice;
28 (3) a description of all prior authorization or
29 other requirements for treatments and services and a
30 description of utilization review mechanisms used by the
31 health maintenance organization, including
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1 preauthorization review, concurrent review, post-service
2 review, post-payment review and any other procedures that
3 may cause an insured to be denied a referral or coverage
4 for a particular service;
5 (4) a description of any financial arrangements or
6 contractual provisions with participating providers or
7 utilization review agents, including withholds and
8 incentive payments to providers, which may restrict
9 referral or treatment options or limit the services
10 offered to an insured;
11 (5) a list, updated no less than annually, of the
12 name, address, telephone number, office hours, ability to
13 accept new enrollees, specialty, and professional
14 credentials;
15 (6) a description of the internal grievance
16 procedure to be used to resolve disputes between a health
17 maintenance organization and an enrollee or enrollee's
18 participating provider;
19 (7) a description of the procedures for providing
20 care and coverage for emergency health services received
21 outside of the health maintenance organization's service
22 area and any notification or other requirements for
23 enrollees;
24 (8) a summary of the health maintenance
25 organization's quality assurance procedures;
26 (9) a description of how the health maintenance
27 organization will address the needs of non-English
28 speaking enrollees;
29 (10) the ratio of participating providers,
30 including primary care physicians and specialists, to
31 enrollees, and the average length of time that passes
32 between the request for routine, specialty care, medical
33 test, or hospital services by an enrollee and when such
34 care is rendered;
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1 (11) the rate of disenrollment by enrollees and
2 participating providers;
3 (12) the governance structure of the health
4 maintenance organization and how enrollees and
5 participating providers may participate in the
6 development of the policies of the health maintenance
7 organization; and
8 (13) a description of how to obtain information
9 regarding a health maintenance organization, including
10 notice of a toll-free telephone number for inquiries.
11 Information required under this Section shall be provided
12 in a clear and coherent manner using words with common
13 everyday language.
14 (b) A health maintenance organization shall disclose to
15 the Director each year the following information:
16 (1) the location of its facilities;
17 (2) the names and credentials of all health care
18 providers that will provide services pursuant to contract
19 or other agreement;
20 (3) a statement of the process established to
21 credential health care providers;
22 (4) a description of the population to be enrolled
23 and the proposed service area;
24 (5) a statement of the times, places, and manner of
25 providing services under the plan;
26 (6) a statement of the services covered by the plan
27 and a description of the procedures to be followed in the
28 event that an enrollee receives emergency or other health
29 care services from a health care provider outside the
30 plan, including a statement of the additional costs to
31 the enrollee of such care;
32 (7) a statement of its quality assurance mechanisms
33 including peer review and utilization review procedures;
34 (8) a statement of the enrollee grievance system
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1 and complaint procedures to be followed by an enrollee, a
2 person acting on behalf of an enrollee, or a health care
3 provider, including a description of the mechanism which
4 may be used to seek reconsideration or appeal, from
5 adverse determination by the utilization review agent;
6 (9) a copy of any proposed contract to be made
7 between the plan organization and health care providers
8 and utilization review agents;
9 (10) the policies and procedures to ensure that all
10 applicable State and federal laws to protect the
11 confidentiality of individual medical and treatment
12 records are followed; and
13 (11) a copy of the materials provided to enrollees
14 and prospective enrollees of the plan pursuant to Section
15 2-1.3.
16 (c) Each year, a health maintenance organization must
17 provide documentation to the Director that it:
18 (1) demonstrates the capability of organizing,
19 managing, promoting, and operating an organization that
20 provides medical and other health care services that meet
21 quality, continuity, and other treatment standards
22 prescribed by the Director in a manner that is timely,
23 effective, and convenient for enrollees;
24 (2) includes a sufficient number of health care
25 providers within defined categories, including specialty
26 providers, throughout the proposed service area to meet
27 the needs of its enrollees and provides its enrollees
28 adequate flexibility to choose a health care provider;
29 (3) demonstrates that financial incentives offered
30 to health care providers to minimize improper
31 over-utilization or under-utilization of health care
32 services will not impair the quality or access to care
33 provided to plan enrollees nor interfere with health care
34 providers' adherence to appropriate professional
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1 standards;
2 (4) provides adequate methods to monitor quality of
3 care including peer review and utilization review and
4 establishes mechanisms to resolve complaints and
5 grievances initiated by any plan enrollee;
6 (5) agrees to provide ready access to the Director
7 of all data, records and information it collects and
8 maintains, and to provide such reports as the Director
9 shall reasonably require concerning medical and health
10 care services costs, quality, and utilization under this
11 Act to the extent that such access and reports are
12 required to enable the Director to perform his or her
13 responsibilities pursuant to this Act, provided that
14 patient identifying information shall only be disclosed
15 in compliance with applicable State or federal laws;
16 (6) complies with any other requirement the
17 Director determines is necessary to provide quality
18 medical and other health care services to enrollees;
19 (7) establishes procedures for managing the care of
20 individuals with chronic, degenerative, disabling, or
21 life threatening diseases or conditions, as defined by
22 the Director in consultation with consumers and providers
23 with expertise in the care and treatment of chronic
24 illnesses, which shall include special case managers or
25 the designation by a chronically ill individual of a
26 specialist as his or her primary care physician;
27 (8) offers enrollees or in groups of 3 or more
28 employees the choice of obtaining any or all medical or
29 health care services that are covered by the plan from
30 health care providers not participating in the plan
31 pursuant to contract, employment, or other association;
32 provided, however, that in no event shall an enrollee
33 elect to have a non-participating health care provider
34 serve as the enrollee's primary care practitioner
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1 responsible for supervising and coordinating the care of
2 the enrollee. For purposes of this item, such coverage
3 may be subject to reasonable, appropriate, and affordable
4 annual deductibles and co-insurance, subject to a
5 reasonable and affordable out-of-pocket limit, as
6 prescribed by the Director; and
7 (9) establishes procedures for managing and
8 providing for the care of non-English speaking persons.
9 (215 ILCS 125/2-1.2 new)
10 Sec. 2-1.2. Internal grievance procedures. The Director
11 shall issue rules for health maintenance organization
12 grievance procedures to be established by health maintenance
13 organizations. The rules shall establish standards for:
14 (1) the process for initiating a grievance, both
15 orally and in writing;
16 (2) notice to enrollees of their right to file
17 grievances and the procedures to initiate such a
18 grievance;
19 (3) reviews of grievances; and
20 (4) notification to enrollees of resolution of a
21 grievance, including appropriate time frames.
22 (215 ILCS 125/2-1.3 new)
23 Sec. 2-1.3. Disclosure to enrollees.
24 (a) A health maintenance organization shall provide all
25 of the following information to its enrolled members at the
26 time of enrollment and annually thereafter, with additional
27 updates provided as required by the Director, make the
28 information available to the general public on request, and
29 file copies of the information with the Director subject to
30 subsection (b) of this Section:
31 (1) All services and benefits provided under the
32 contract, including any service or benefit maximum,
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1 limitations and exclusions; and any services excluded on
2 the basis of being experimental or investigational and
3 the criteria used for that determination. The
4 information shall, on request, include any prescription
5 drug formulary.
6 (2) An explanation of procedures used in
7 authorizing, referring, certifying, approving, reviewing,
8 limiting and denying (including appeals) services or
9 benefits requested or used by a provider or enrollee.
10 This shall include the terms for access to providers
11 within the plan as well as providers outside the plan.
12 Criteria specific to a decision shall be provided in a
13 timely manner to the provider or enrollee on request; and
14 all criteria for decisions shall be filed with the
15 Director.
16 (3) A listing of all primary practitioners and
17 specialists available to an enrollee, with any
18 limitations on their availability. The listing shall
19 include each practitioner's name, address, telephone
20 number, licensure, specialty, board certification, and
21 hospital affiliation. On request, the information shall
22 include statistics on the frequency with which individual
23 practitioners have performed specific procedures and
24 treatments.
25 (4) Criteria and procedures for selection and
26 termination of providers for and from the health
27 maintenance organization, including statistics relating
28 to disenrollment of providers.
29 (5) Numbers and ratios of primary care
30 practitioners and specialists available under the plan to
31 the number of enrollees.
32 (6) A description of financial arrangements,
33 compensation, and incentives with providers within and
34 not within the plan, and with utilization review
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1 organizations.
2 (7) Procedures for enrollee and provider
3 grievances, including time periods for making decisions.
4 (8) A description of the plan's quality assurance
5 procedures. The plan's accreditation survey results and
6 outcomes reporting shall be available on request and
7 shall be filed with the Director.
8 (9) A statement of the enrollee's financial
9 responsibility for services and benefits, including
10 services provided by providers within and not within the
11 plan, including deductibles, co-payments, and
12 co-insurance.
13 (10) Statistics on enrollee satisfaction, including
14 reenrollment, disenrollment, complaints in specific
15 categories, and times required for getting access to
16 various services.
17 (11) The plan contract.
18 (12) The percentage of premium income expended on
19 health services for enrollees and administrative
20 services.
21 (13) Procedures and terms for enrollees selecting
22 and changing primary care practitioners and specialists.
23 (14) Procedures for protecting the confidentiality
24 of medical records and other patient information.
25 (15) Telephone numbers for obtaining information
26 about the plan.
27 (16) Members of the governing body, officers,
28 senior administrative staff, and a description of the
29 ownership of the health maintenance organization,
30 including the identity of any person or entity owning 5%
31 or more of the equity of the entity and whether the
32 entity is owned and operated as a for-profit or
33 not-for-profit entity.
34 (17) A certified financial statement shall be
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1 provided on request and filed with the Director.
2 (18) Such other information as the Director shall
3 require.
4 (b) Enrollees shall be provided information relating to
5 the enrollee's contract. Enrollees and members of the
6 general public shall receive on request information as to any
7 contract offered by the health maintenance organization. The
8 Director shall receive for filing information as to all
9 contracts offered by the health maintenance organization.
10 The information provided, made available, and filed under
11 subsection (a) of this Section shall be subject to the rules
12 of the Director as to form, content, and frequency of
13 updating. It shall be fully and clearly stated, so as to
14 facilitate understanding and comparison, and shall exclude
15 information that is misleading or unreasonably confusing.
16 (215 ILCS 125/2-1.4 new)
17 Sec. 2-1.4. Credentialing process; appeal.
18 (a) A health maintenance organization shall establish a
19 credentialing process for all participating providers that
20 complies with all of the following:
21 (1) Credentials health care providers based on
22 objective standards of quality developed in consultation
23 with appropriately qualified health care providers.
24 (2) Affords all health care providers within the
25 plan's geographic service area the ability to apply for
26 credentials and to enter into a written contract with the
27 plan if the health care provider meets with the plan's
28 credentialing standards. When a health care provider is
29 denied credentials, the plan must apprise the health care
30 provider denied credentials of the grounds, including
31 economic considerations, for the denial in writing.
32 (3) Guarantees access to specialized treatment
33 expertise by entering into agreements with centers of
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1 specialized care to ensure that enrollees may elect to
2 receive the specialized treatment expertise of such
3 centers or by permitting enrollees to obtain specialized
4 treatment from such centers even in the event that the
5 health maintenance organization does not have agreements
6 with such centers or such centers are outside the network
7 of the plan. A managed care plan shall be deemed to be
8 in accordance with this item if the agreement of such
9 plan provides that, with respect to conditions within the
10 specialized treatment expertise of the center involved,
11 the plan, at the enrollee's election, will refer medical
12 cases involving such conditions to such center in a
13 timely manner, and will inform enrollees routinely of the
14 availability of referral care and has established an
15 appeal mechanism through which the enrollee may challenge
16 denials or referrals to such centers. For the purposes
17 of this Section, centers of specialized care shall
18 include, but are not limited to, National Cancer
19 Institute-designated cancer centers, hospital
20 AIDS-designated centers and other specialized centers as
21 may be designated by the Director.
22 (4) Includes a procedure for each health care
23 provider application to be reviewed by a credentialing
24 committee with appropriate representation of the health
25 care provider's specialty or professional discipline.
26 (5) Makes available to health care providers and
27 enrollees for inspection upon written request all
28 standards including economic consideration utilized as
29 part of the credentialing process.
30 (b) A health maintenance organization shall create
31 appeals mechanisms and procedures by which credential
32 denials, credential reductions, or provider terminations may
33 be challenged, including notice of the underlying complaint,
34 an opportunity to be heard and, where the plan seeks to
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1 terminate a provider, an opportunity to complete a corrective
2 action plan. No such opportunity shall be offered to any
3 provider where the termination is necessary to protect the
4 life, health or safety of plan enrollees.
5 (c) A health maintenance organization shall establish a
6 mechanism with defined rights under which health care
7 providers participating in the plan are assured input into
8 the plan's medical policy, utilization review, quality
9 assurance procedures, credentialing criteria, and medical
10 management procedures.
11 (d) A health maintenance organization is prohibited
12 from:
13 (1) using economic consideration or economic
14 profiling of providers unless such considerations or
15 profiles utilize objective criteria adjusted to recognize
16 case mix, severity of illness, age and provider practice
17 costs;
18 (2) terminating any health care provider from the
19 managed care plan without cause, provided that cause in
20 such an instance shall not include advocating for a
21 particular treatment or services on behalf of an
22 enrollee; and
23 (3) making any payment, either directly or
24 indirectly, to a health care provider or group of
25 providers as an inducement to reduce or to limit
26 medically necessary services provided to an enrollee.
27 (215 ILCS 125/2-1.5 new)
28 Sec. 2-1.5. Community service plans. A health
29 maintenance organization offering comprehensive health
30 benefits pursuant to this Act shall file by January 1, 1998,
31 and thereafter annually, a community service plan with the
32 Director which identifies the unmet health care needs of the
33 region or service areas the organization serves and the
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1 organization's efforts to meet such needs. Such efforts may
2 include, but shall not be limited to, outreach activities in
3 medically unserved or underserved communities such as health
4 education and counselling for such populations; primary and
5 preventive medicine such as immunization, mammography
6 testing, lead paint screening, blood pressure, cholesterol or
7 sexually-transmitted disease testing; and contracting with
8 health facilities that serve high percentages of uninsured
9 persons. Beginning January 1, 1998, and annually thereafter,
10 the plan shall detail the health maintenance organization's
11 financial commitment to meeting such needs.
12 (215 ILCS 125/2-1.6 new)
13 Sec. 2-1.6. Obligation to offer a comprehensive
14 point-of-service health benefits policy in the individual
15 market.
16 (a) For the purpose of this Section, a "comprehensive
17 point-of-service health benefits policy" shall mean a policy
18 in compliance with Article XX of the Illinois Insurance Code
19 that has been approved by the Director and that includes all
20 of the following features:
21 (1) Inpatient care, including:
22 (A) room, board and general nursing care for
23 an unlimited number of days;
24 (B) maternity care and routine nursery care
25 during mother's birth-related hospital confinement
26 for up to 30 days;
27 (C) psychiatric care for up to 30 inpatient
28 days per calendar year; and
29 (D) physical medicine and rehabilitation.
30 (2) Outpatient care, including:
31 (A) ambulatory surgery;
32 (B) surgery;
33 (C) mammography screening;
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1 (D) blood;
2 (E) treatment of initial visit for sudden and
3 serious illness and accidental injury;
4 (F) presurgical testing;
5 (G) chemotherapy;
6 (H) radiation therapy;
7 (I) physical therapy for up to 90 visits per
8 calendar year following surgery or hospitalization;
9 (J) outpatient kidney dialysis; and
10 (K) diagnostic x-rays and laboratory services.
11 (3) Special care, including:
12 (A) home health care for up to 200 visits per
13 calendar year;
14 (B) hospice care for up to 210 days; and
15 (C) skilled nursing facility for up to 365
16 days when preceded by a hospital stay.
17 (4) Physician services, including:
18 (A) surgery;
19 (B) anesthesia;
20 (C) surgical assistance;
21 (D) maternity care;
22 (E) primary and preventive care and well-baby
23 and well-child care;
24 (F) consultation services of one for each
25 specialty;
26 (G) in-hospital doctor visits;
27 (H) home and office visits;
28 (I) psychiatric care for up to 30 inpatient
29 visits per calendar year and outpatient psychiatric
30 care and psychiatric emergency visits; and
31 (J) second surgical opinion.
32 (5) Other professional services and supplies,
33 including:
34 (A) x-ray, radium, and radionuclide therapy;
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1 (B) electroconvulsive therapy;
2 (C) diagnostic x-ray and laboratory services;
3 (D) chemotherapy;
4 (E) supplies and medical equipment;
5 (F) private duty nursing, when pre-approved,
6 up to $5,000 per calendar year and $10,000 lifetime;
7 (G) prosthetic and orthotic appliances and
8 durable medical equipment;
9 (H) ambulance services;
10 (I) outpatient physical therapy visits;
11 (J) inpatient physician medicine and
12 rehabilitation; and
13 (K) mammography screening.
14 (6) Insulin and prescription drugs subject to a
15 deductible not to exceed $10 per prescription and $100
16 per covered person per calendar year or $300 per covered
17 family per calendar year. A policy issued pursuant to
18 this Section may require that such drugs be obtained
19 through a participating or in-house pharmacy or through
20 the mail, provided that the Director determines that such
21 arrangement does not impose an undue burden on a
22 consumer.
23 (7) The ability to receive services out of network,
24 subject to a deductible not to exceed $1,000 per
25 individual and $2,000 per family and co-insurance
26 payments at a ratio of 80:20, provided that out-of-pocket
27 costs for co-insurance and deductibles do not exceed
28 $2,500 per individual or $5,000 per family annually, and
29 provided further that a lifetime maximum for
30 out-of-network benefits of no less than $500,000 may be
31 imposed and that co-insurance payments shall be based on
32 a usual, customary, or reasonable fee schedule filed with
33 the Department or a comparable index used for
34 out-of-network benefits for small groups.
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1 (8) For in-network services, a co-payment not to
2 exceed $10 per visit.
3 (b) Notwithstanding any other provision of law, every
4 health maintenance organization engaged in writing or
5 renewing comprehensive health services policies shall offer a
6 comprehensive point-of-service health benefits policy
7 approved by the Director to individuals within its service
8 area on or before July 1, 1998.
9 (c) The Director shall develop a plan for the marketing
10 to individuals of comprehensive point-of-service health
11 benefits policies offered to individuals under this Section.
12 The plan shall include the publication, no less than
13 semi-annually, of a manual containing the names, addresses,
14 and telephone numbers of the health maintenance organizations
15 offering the policies and a description of the benefits and
16 premiums in such a manner that facilitates consumer
17 comparison. The Director shall also establish and maintain a
18 toll-free telephone number at the Department to provide
19 information about the policies.
20 (d) Before December 1, 1997, and not less than annually
21 thereafter, the Director shall conduct hearings in various
22 areas of the State to solicit testimony related to the
23 affordability of such policies and the adequacy of benefits.
24 (215 ILCS 125/2-1.7 new)
25 Sec. 2-1.7. Reimbursement for emergency room care. The
26 Director shall issue uniform rules for the reimbursement of
27 emergency care rendered in emergency rooms of general
28 hospitals. The rules shall include, but not be limited to,
29 standards delineating the responsibilities for notification
30 between health care providers and health maintenance
31 organizations; standards for treatment and payment for stable
32 and nonstable cases; and, resolution of disputes between
33 general hospitals, patients, and health maintenance
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1 organizations. For the purposes of this Section, "emergency
2 care" means those health care procedures, treatments, or
3 services, including psychiatric stabilization and medical
4 detoxification from drugs or alcohol, that are provided after
5 the sudden onset of what reasonably appears to be a medical
6 condition that manifests itself by symptoms of sufficient
7 severity, including severe pain, that the absence of
8 immediate medical attention could reasonably be expected by a
9 prudent layperson, who possesses an average knowledge of
10 health and medicine, to result in:
11 (1) placing the patient's health in serious
12 jeopardy;
13 (2) serious impairment to bodily functions; or
14 (3) serious dysfunction of any bodily organ or
15 part.
16 (215 ILCS 125/4-17 new)
17 Sec. 4-17. Drug; use for other purpose; clinical trials.
18 (a) No contract or evidence of coverage amended,
19 delivered, issued, or renewed in this State after the
20 effective date of this amendatory Act of 1997 which provides
21 coverage for prescribed drugs or devices approved by the Food
22 and Drug Administration of the United States government shall
23 exclude coverage of any such drug or device on the basis that
24 such drug or device has not been specifically approved by the
25 Food and Drug Administration for treatment of the disease or
26 condition for which it has been prescribed, provided,
27 however, that such drug or device must:
28 (1) be recognized for treatment of the specific
29 disease or condition in the American Medical Association
30 Drug Evaluation, the American Hospital Formulary Service
31 Drug Information, or the United States Pharmacopoeia Drug
32 Information;
33 (2) be covered for reimbursement by the Illinois
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1 Department of Public Aid under Article V of the Illinois
2 Public Aid Code; or
3 (3) be recommended for such use by article and or
4 editorial comment in a peer-reviewed medical or
5 scientific journal.
6 (b) Every contract or evidence of coverage amended,
7 delivered, issued, or renewed in this State that provides
8 hospital, medical or surgical, or prescription drug coverage
9 shall cover the patient costs incurred in clinical trials of
10 treatments for life-threatening, degenerative, or permanently
11 disabling conditions or a condition associated with or a
12 complication of such a condition, to the extent such costs
13 would be covered for noninvestigational treatments, providing
14 that all of the following conditions are satisfied:
15 (1) treatment is provided with a therapeutic or
16 palliative intent;
17 (2) treatment is being provided pursuant to a
18 clinical trial approved by one of the National Institutes
19 of Health (NIH), an NIH cooperative group or an NIH
20 center, the FDA in the form of an investigational new
21 drug (IND) exemption, the Department of Veterans Affairs,
22 or a qualified nongovernmental research entity as
23 identified in guidelines issued by individual NIH
24 Institutes for center support grants;
25 (3) the proposed therapy has been reviewed and
26 approved by a qualified institutional review board (IRB);
27 (4) the facility and personnel providing the
28 treatment are capable of doing so by virtue of their
29 experience and training;
30 (5) there is no clearly superior,
31 noninvestigational alternative to the protocol treatment;
32 and
33 (6) the available clinical or preclinical data
34 provide a reasonable expectation that the protocol
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1 treatment will be at least as efficacious as the
2 alternative.
3 (c) As used in this Section, "cooperative groups" mean
4 formal networks of facilities that collaborate on research
5 projects and have an established, NIH-approved peer review
6 program operating within their groups. These include, but
7 are not limited to, the National Cancer Institute (NCI)
8 Clinical Cooperative Groups, the NCI Community Clinical
9 Oncology Program (CCOP), the AIDS Clinical Trials Group
10 (ACTG), and the Community Programs for Clinical Research in
11 AIDS (CPCRA).
12 As used in this Section, patient costs shall include all
13 costs of health services required to provide treatment
14 according to the design of the trial. Such costs shall not
15 include the costs of any investigational drugs or devices
16 themselves, the costs of any nonhealth services that might be
17 required for a person to receive the treatment, the costs of
18 managing the research, or costs that would not be covered
19 under the contract for noninvestigational treatments. The
20 costs of drugs and devices that have been approved for sale
21 by the Food and Drug Administration shall be covered whether
22 or not the Food and Drug Administration has approved the drug
23 or device for use in treating the patient's particular
24 condition.
25 (215 ILCS 125/Art. VII heading new)
26 ARTICLE VII. UTILIZATION REVIEW
27 (215 ILCS 125/7-1 new)
28 Sec. 7-1. Definitions. For purposes of this Article,
29 unless the context clearly requires otherwise:
30 "Adverse determination" means a determination by a
31 utilization review agent that proposed or provided health
32 care procedures, treatments, or services are not medically
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1 necessary or appropriate, are considered experimental, are
2 not approved or authorized for a specific level of care, or
3 are otherwise denied.
4 "Certificate" means a certificate of registration granted
5 by the Director to a utilization review agent pursuant to the
6 provisions of this Article.
7 "Enrollee" means a person covered by a health plan and
8 includes a person who is covered as an eligible dependent of
9 another person.
10 "Health care procedures, treatments, and services"
11 include services rendered by a person or entity duly licensed
12 or legally authorized to provide health care services.
13 "Utilization review agent" means any person or entity,
14 not affiliated with a facility, performing utilization review
15 that is either a component of, affiliated with, under
16 contract with, or acting on behalf of:
17 (1) an employer or any other entity that provides,
18 offers to provide, or administers health care benefits
19 for persons in this State, including, but not limited to,
20 preferred provider organizations;
21 (2) a self-insured health insurance plan; or
22 (3) a third party that provides or administers
23 health benefits, including:
24 (A) a health maintenance organization licensed
25 under this Act; or
26 (B) a utilization review agent located outside
27 of this State, if it conducts utilization review
28 activities relating to persons in this State.
29 "Utilization review" means the review to determine
30 whether health care procedures, treatments, or services that
31 have been provided, are being provided, or are proposed to be
32 provided to a patient or a group of patients, whether
33 undertaken prior to, concurrent with, or subsequent to the
34 delivery of such procedures, treatments, and services, are
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1 medically necessary, appropriate, considered experimental,
2 not approved for or authorized for a specific level of care,
3 or are otherwise denied. For the purposes of this Article
4 none of the following shall be considered utilization review:
5 (1) denials based on failure to obtain procedures,
6 treatments, or services from a designated or approved
7 provider as required under the health benefit plan of
8 coverage;
9 (2) any review or determination where the dispute
10 resolution process of Section 4-6 applies;
11 (3) the determination of any plan of coverage
12 issues other than issues of whether health care
13 procedures, treatments, or services are medically
14 necessary or appropriate, are considered experimental,
15 are not approved or authorized for a specific level of
16 care, or are otherwise denied.
17 "Emergency care" means those health care procedures,
18 treatments, or services, including psychiatric stabilization
19 and medical detoxification from drugs or alcohol, that are
20 provided after the sudden onset of what reasonably appears to
21 be a medical condition that manifests itself by symptoms of
22 sufficient severity, including severe pain, that the absence
23 of immediate medical attention could reasonably be expected
24 by a prudent layperson, who possesses an average knowledge of
25 health and medicine, to result in:
26 (1) placing the patient's health in serious
27 jeopardy;
28 (2) serious impairment to bodily function; or
29 (3) serious dysfunction of any bodily organ or
30 part.
31 (215 ILCS 125/7-2 new)
32 Sec. 7-2. Application for certificate.
33 (a) A utilization review agent may not conduct
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1 utilization review unless it has been granted a certificate
2 by the Director pursuant to this Article.
3 (b) The application for a certificate shall be submitted
4 to the Director on forms prescribed by the Director and
5 accompanied by supporting documentation which shall include
6 the following:
7 (1) a utilization review plan which shall include:
8 (A) the specific review standards, criteria,
9 and procedures to be used in evaluating proposed or
10 delivered health care procedures, treatments, and
11 services that have been provided, are being
12 provided, or are proposed to be provided, including
13 provision for access to such review standards,
14 criteria, and procedures by providers and recipients
15 of such proposed or delivered procedures, treatments
16 and services;
17 (B) a description of the procedure by which
18 such review standards, criteria, and procedures
19 shall be established, evaluated, and periodically
20 updated under the supervision of licensed health
21 care professionals with demonstrated experience and
22 expertise in the relevant field and shall be in
23 compliance with the operating regulations of the
24 relevant agency which licenses the health care
25 facility or program;
26 (C) those circumstances, if any, under which
27 utilization review may be delegated to a licensed
28 facility's utilization review program;
29 (D) the provisions by which an enrollee, a
30 person acting on behalf of an enrollee, or the
31 enrollee's health care provider may seek
32 reconsideration of or appeal from adverse
33 determinations by the utilization review agent,
34 including provisions to ensure a timely appeal and
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1 that enrollees, people acting on behalf of
2 enrollees, or the enrollee's health care provider
3 are informed of their right to appeal adverse
4 determinations;
5 (E) procedures by which a decision on a
6 request for utilization review for services
7 requiring preauthorization shall comply with time
8 frames as prescribed by the Director by rule; and
9 (F) A description of an emergency care policy,
10 which shall include the procedures under which an
11 emergency admission shall be made or emergency
12 treatment shall be given;
13 (2) the qualifications of the personnel either
14 employed to perform or under contract to perform the
15 utilization review, including provisions that require
16 that any adverse determinations shall be made by health
17 care professionals with demonstrated experience in the
18 health care procedure, treatment, or service under
19 review;
20 (3) provisions to ensure that appropriate personnel
21 of the utilization review agent are reasonably accessible
22 by toll-free telephone at times to be prescribed by the
23 Director by rule, but in no event less than 40 hours per
24 week during normal business hours, to discuss patient
25 care and allow response to telephone requests, to ensure
26 that such utilization review agent has a telephone system
27 capable of accepting, recording, or providing
28 instructions to incoming telephone calls during other
29 than normal business hours, and to ensure response to
30 accepted or recorded messages not less than one working
31 day after the date on which the call was received;
32 (4) the policies and procedures to ensure that all
33 applicable State and federal laws to protect the
34 confidentiality of individual medical and treatment
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1 records are followed;
2 (5) a copy of the materials designed to inform
3 applicable patients and providers of the requirements of
4 the utilization review plan, including, when requested,
5 the specific review standards, criteria, and procedures
6 used by the utilization review agent relevant to the
7 matter under review, and provisions that such materials
8 shall be made available to patients and providers by the
9 utilization review agent at a reasonable charge;
10 (6) a list of the third party payors for which the
11 utilization review agent is performing utilization review
12 in this State; and
13 (7) such other information as the Director may
14 reasonably require.
15 (c) Applications for certifications pursuant to this
16 Section and certification renewals pursuant to Section 7-3 of
17 this Article shall be accompanied by an application fee or
18 certification renewal fee. The Director shall determine such
19 fee which will reasonably cover the costs to the Department
20 of administering this Article.
21 (215 ILCS 125/7-3 new)
22 Sec. 7-3. Issuance of certificate.
23 (a) The Director shall review an application and issue a
24 certificate to an applicant that has complied with the
25 requirements of Section 7-2 of this Article and has met the
26 following criteria for utilization review agents:
27 (1) employs or will otherwise secure the services
28 of adequate personnel qualified within the relevant field
29 to determine the necessity of health care procedures,
30 treatments, and services as defined in Section 7-1 of
31 this Article;
32 (2) demonstrates the ability to render utilization
33 review decisions and appeals to review decisions in a
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1 timely manner as provided in this Section;
2 (3) agrees to provide ready access to the Director
3 to all data, records, and information it collects and
4 maintains and to provide such reports, as the Director
5 shall reasonably require, to the Director concerning its
6 utilization review activities under this Article to the
7 extent such access and reports are required to enable the
8 Director to perform his or her responsibilities pursuant
9 to this Article, provided that patient identifying
10 information shall only be disclosed in compliance with
11 applicable State or federal laws; and
12 (4) provides assurances that the utilization review
13 personnel shall not have a conflict of interest based on
14 hospital or professional affiliation in conducting
15 utilization review.
16 (b) A certificate issued under this Article is not
17 transferable.
18 (c) A certificate issued under this Article is valid for
19 a period of not more than 2 years and may be renewed for
20 additional periods of 2 years.
21 (d) A certificate may be renewed for an additional 2
22 year period if the applicant is otherwise entitled to a
23 certificate and submits to the Director a renewal
24 application, on forms prescribed by the Director, setting
25 forth the information that is required to be submitted
26 pursuant to this Article and satisfactory evidence of
27 compliance with the requirements of this Article.
28 (e) The Director may grant an individual health
29 maintenance organization licensed pursuant to this Act a
30 waiver from any requirements of Section 7-2 of this Article
31 on a finding that the health maintenance organization has
32 practices that substantially accomplish the purposes of the
33 waived requirement and that the waiver is consistent with the
34 purposes of this Article.
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1 (215 ILCS 125/7-4 new)
2 Sec. 7-4. Denial or revocation of certificate.
3 (a) The Director shall deny a certificate to any
4 applicant if:
5 (1) the utilization review plan fails to contain
6 all the information required under Section 7-2 of this
7 Article; or
8 (2) the applicant fails to meet all requirements of
9 Sections 7-2 and 7-3 of this Article.
10 (b) The Director may revoke a certificate if the holder
11 does not comply with performance assurances under this
12 Article, fails to continue to meet approval criteria
13 established pursuant to Section 7-3 of this Article, or
14 violates any provision of this Article.
15 (c) Before denying or revoking a certificate under this
16 Article, the Director shall provide the applicant or
17 certificate holder reasonable time to supply additional
18 information demonstrating compliance with this Article.
19 In denying a certificate to an applicant, the Director
20 shall provide to the applicant a notice detailing the
21 specific deficiencies identified consistent with the
22 standards set forth in this Section.
23 Within 15 days of the date of a notice of rejection or
24 revocation from the Director pursuant to this Section, an
25 applicant or certificate holder may request a hearing
26 pursuant to the Illinois Administrative Procedure Act. The
27 Director shall notify the applicant or certificate holder of
28 a date and place for a hearing to be commenced not later than
29 60 days from the date of such notification.
30 Any rejection or revocation by the Director is reviewable
31 under the Administrative Review Law.
32 (215 ILCS 125/7-5 new)
33 Sec. 7-5. Reporting requirements. The Director shall
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1 establish reporting requirements to evaluate the
2 effectiveness of utilization review agents and to determine
3 if the utilization review programs are in compliance with the
4 provisions of this Article and applicable rules.
5 (215 ILCS 125/7-6 new)
6 Sec. 7-6. Notice of adverse determinations made by
7 utilization review agents.
8 (a) A utilization review agent shall notify the
9 enrollee, or a person acting on behalf of the enrollee, and
10 the enrollee's health care provider of an adverse
11 determination made in a utilization review.
12 (b) The notification required by this Section shall be
13 consistent with rules promulgated by the Director as to time
14 and manner, but shall be transmitted within no more than 3
15 working days if the enrollee is not hospitalized and in no
16 more than one working day if the enrollee is hospitalized at
17 the time of the adverse determination.
18 (c) The notification by the utilization review agent
19 must include:
20 (1) the clinical basis for the adverse
21 determination; and
22 (2) a description of the procedure for a timely
23 appeal, including information on how to obtain the
24 specific review standards, criteria, and procedures used
25 in making the adverse determination.
26 (215 ILCS 125/7-7 new)
27 Sec. 7-7. Appeal of adverse determinations of utilization
28 review agents.
29 (a) A utilization review agent shall maintain and make
30 available a written description of the appeal procedure of an
31 adverse determination.
32 (b) The procedures for appeals shall be reasonable and
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1 timely and shall include the following:
2 (1) a provision that an enrollee, a person acting
3 on behalf of the enrollee, or the enrollee's health care
4 provider may appeal the adverse determination and shall
5 be provided, on request, a clear and concise statement of
6 the clinical basis for the adverse determination and the
7 procedures to be followed in undertaking the appeal;
8 (2) a provision that a decision on an appeal shall
9 be made in consultation with a health care provider who
10 has expertise in managing the medical condition,
11 procedure, or treatment under appeal for review of the
12 adverse determination, who is in the same licensed
13 profession as the health care provider who proposed or
14 delivered such health care procedures, treatments, or
15 services, and who has not previously reviewed the case,
16 and in the case that the provider is a physician in a
17 specialty who was acting in that specialty, the decision
18 on appeal shall be made by another physician in the same
19 or similar specialty;
20 (3) a method for an expedited appeal procedure for
21 denials of continued stays for hospitalized and
22 residential care patients; and
23 (4) written notification to the appealing party of
24 the determination of the appeal, as soon as practicable,
25 but in no case later than 14 days after receiving all the
26 required documentation of the appeal. If the appeal is
27 denied, the written notification shall include the
28 clinical basis for the appeal's denial, licensure and
29 area of expertise of the health care provider making the
30 denial, in the case of a physician making the denial the
31 specialty of the physician, and a description of the
32 procedure for initiating dispute resolution under Section
33 7-8 of this Article.
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1 (215 ILCS 125/7-8 new)
2 Sec. 7-8. Dispute resolution system.
3 (a) The Director shall establish a statewide utilization
4 review dispute resolution system composed of regional
5 organizations to resolve disputes between a utilization
6 review agent or a managed care entity and an enrollee, a
7 person acting on behalf of an enrollee, or the enrollee's
8 health care provider. The Director shall enter into
9 agreements with an independent entity or entities to
10 administer the dispute resolution system.
11 (b) The Director shall adopt uniform and necessary rules
12 for the regional organizations including, but not limited to:
13 (1) procedures and time limits to initiate dispute
14 resolution proceedings;
15 (2) procedures for notification of all parties
16 involved in the dispute upon initiation and determination
17 of a dispute resolution proceeding;
18 (3) time limits for resolving disputes;
19 (4) required documents to be submitted, including,
20 but not limited to, those required under Section 7-7 of
21 this Article;
22 (5) procedures for regular review of compliance
23 with regional organization determinations; and
24 (6) procedures to ensure maintenance of
25 confidentiality pursuant to this Act and other applicable
26 law.
27 (c) To be approved as a regional organization for
28 utilization review dispute resolution, an entity must meet
29 the following criteria:
30 (1) it shall employ or otherwise secure the
31 services of adequate personnel qualified to review such
32 disputes;
33 (2) it shall demonstrate the ability to render
34 determinations in a timely manner and independently of
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1 conflicts of interests;
2 (3) it shall provide ready access by the Director
3 to all data, records, and information it collects and
4 maintains concerning its dispute resolution activities;
5 and
6 (4) it shall agree to provide to the Director such
7 data, information, and reports as the Director determines
8 necessary to evaluate the dispute resolution process
9 provided pursuant to this Article.
10 (d) When a final determination has been made by a
11 utilization review agent pursuant to Section 7-7 of this
12 Article, the enrollee, a person acting on behalf of an
13 enrollee, or the enrollee's health care provider may appeal
14 the decision to the regional organization.
15 (e) All determinations by regional organizations for
16 utilization review dispute resolution shall be binding upon
17 the parties, subject to judicial review.
18 (215 ILCS 125/7-9 new)
19 Sec. 7-9. Required and prohibited practices.
20 (a) A utilization review agent shall have written
21 procedures for assuring that patient-specific information
22 obtained during the process of utilization review will be:
23 (1) kept confidential in accordance with applicable
24 State and federal laws;
25 (2) used solely for the purpose of utilization
26 review, quality assurance, and discharge planning and
27 catastrophic case management; and
28 (3) shared only with those who are authorized in
29 writing by the enrollee or a person acting on behalf of
30 the enrollee to receive such information or where
31 otherwise permitted or required by law.
32 (b) Summary data shall not be considered confidential if
33 it does not provide information to allow identification of
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1 individual patients.
2 (c) A utilization review agent shall not, with respect
3 to utilization review activities, permit or provide
4 compensation or anything of value to its employees or agents,
5 condition employment of its employees or agents, set its
6 employee or agent evaluations, or set its employee or agent
7 performance standards based on the value or volume of adverse
8 determinations, deductions, or limitations on lengths of
9 stay, benefits, services, or charges or on the number or
10 frequency of telephone calls or other contacts with health
11 care providers or patients. A utilization review agent shall
12 not permit or provide compensation or anything of value to
13 any health care provider in a manner that would discourage a
14 health care provider from providing appropriate patient care.
15 (d) If a health care procedure, treatment, or service
16 has been preauthorized or approved for a patient by a
17 utilization review agent, the utilization review agent shall
18 not subsequently revise or modify the specific standards
19 criteria, and procedures used for the utilization review for
20 services delivered to that patient.
21 (e) In no event shall utilization review for purposes of
22 continuing payment be requested of a patient or provider or
23 facility providing services to be undertaken more frequently
24 than is reasonably required to assess whether the health care
25 procedures, treatments, or services under review are
26 medically necessary or appropriate, considered experimental,
27 not approved or authorized for a specific level of care, or
28 otherwise denied.
29 (f) Utilization review agents shall collect only such
30 information as is necessary to make a utilization review
31 determination and shall not routinely request copies of
32 medical records of all patients in connection with reviews
33 conducted concurrently with or prior to the delivery of
34 health care procedures, treatments, and services. Record
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1 requests shall be made on a reasonable basis relating to
2 characteristics of the patient, provider, condition, or
3 health care procedure, treatment, or service.
4 (g) In no event shall information be obtained from the
5 providers of health care procedures, treatments, or services
6 for the use of the utilization review agent by persons other
7 than physicians, registered nurses, physician assistants,
8 other health care providers, medical record technologists, or
9 administrative personnel who have received appropriate formal
10 orientation and training.
11 (h) The utilization review agent shall not undertake
12 utilization review and managed care at the site of the
13 provision of health care procedure, treatment, or service
14 unless the utilization review agent:
15 (1) identifies himself or herself by name and the
16 name of his or her organization, including displaying
17 photographic identification which includes the name of
18 the employer and clearly identifies the individual as an
19 employee of the utilization review agent;
20 (2) whenever possible, schedules reviews at least
21 one business day in advance with the appropriate health
22 care provider;
23 (3) if requested by a health care provider, assures
24 that the on-site review staff register with the
25 appropriate contact person, if available, prior to
26 requesting any clinical information or assistance from
27 the health care provider; and
28 (4) obtains written consent from the enrollee,
29 person acting on behalf of the enrollee, or enrollee's
30 health care provider before interviewing the patient or
31 the patient's family or observing or participating in any
32 health care procedure, treatment, or service being
33 provided to the enrollee.
34 (i) A utilization review agent shall not base an adverse
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1 determination on a refusal to consent to observing or
2 participating in any health care procedure, treatment, or
3 service.
4 (j) A utilization review agent shall not base an adverse
5 determination on lack of reasonable access to a health care
6 provider's medical or treatment records unless the
7 utilization review agent has provided reasonable notice to
8 the health care provider and has complied with all provisions
9 of subsection (h) of this Section.
10 (k) Neither the utilization review agent nor the entity
11 for which the agent provides utilization review shall take
12 any action with respect to a patient or provider of health
13 care procedures, treatments, or services that is intended to
14 penalize such enrollee, person acting on behalf of the
15 enrollee, or the enrollee's health care provider for, or to
16 discourage such enrollee, person acting on behalf of an
17 enrollee, or the enrollee's health care provider from
18 undertaking an appeal, dispute resolution, or judicial review
19 of an adverse determination.
20 (l) A decision to approve or deny an enrollee continued
21 inpatient treatment shall be communicated to the enrollee's
22 health care provider within 24 hours after a properly
23 documented request is submitted to the utilization review
24 agent, regardless of whether that request is made before the
25 end of the previously certified treatment period.
26 (m) In no event shall an enrollee, a person acting on
27 behalf of an enrollee, an enrollee's health care provider,
28 any other health care provider, or any other person or entity
29 be required to inform or contact the utilization review agent
30 prior to the provision of emergency care, including emergency
31 treatment or emergency admission.
32 (215 ILCS 125/7-10 new)
33 Sec. 7-10. Penalties.
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1 (a) Any person or utilization review agent who shall
2 disclose, compel another person to disclose, or procure the
3 disclosure of confidential patient information in violation
4 of this Article shall be subject to a civil penalty not to
5 exceed $5,000 for each occurrence.
6 (b) Any person engaged in utilization review activity
7 under this Article who willfully violates any law or rule
8 relating to patient information with respect to patient
9 information acquired in the course of utilization review
10 shall be guilty of a Class A misdemeanor.
11 (215 ILCS 125/7-11 new)
12 Sec. 7-11. Rules.
13 (a) The Director shall promulgate such rules as are
14 necessary to implement the provisions of this Article.
15 (b) In developing the rules, the Director shall consider
16 the recommendations of health care providers, utilization
17 review agents, and payors and consumers of health care
18 services, resources, and treatments.
19 (c) The Director shall maintain and regularly update and
20 make available to providers of health care procedures,
21 treatments, and services, and to the public, upon request, a
22 list of utilization review agents that have received
23 certificates in accordance with this Article.
24 Section 99. Effective date. This Act takes effect upon
25 becoming law.