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90_SB1922
215 ILCS 5/356w new
215 ILCS 5/370s 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, the Health
Maintenance Organization Act, the Limited Health Service
Organization Act, and the Voluntary Health Services Plans
Act. Provides that coverage under those Acts must include
coverage for diabetes self-management training and education
and for specified equipment and drugs used in the treatment
of diabetes. Effective January 1, 1999.
SRS90SB0086MNge
SRS90SB0086MNge
1 AN ACT concerning insurance coverage for diabetes
2 self-management training and education, 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 Sections 356w and 370s as follows:
7 (215 ILCS 5/356w new)
8 Sec. 356w. Diabetes self-management training and
9 education.
10 (a) A group policy of accident and health insurance that
11 is amended, delivered, issued, or renewed after the effective
12 date of this amendatory Act of 1998 shall provide coverage
13 for outpatient self-management training and education,
14 equipment, and supplies, as set forth in this Section, for
15 the treatment of diabetes.
16 (b) As used in this Section:
17 "Diabetes self-management training" means instruction in
18 an outpatient setting which enables a diabetic patient to
19 understand the diabetic management process and daily
20 management of diabetic therapy as a means of avoiding
21 frequent hospitalizations and complications. Diabetes
22 self-management training shall include, but not be limited
23 to, medical nutrition therapy.
24 "Medical nutrition therapy" shall have the meaning
25 ascribed to "medical nutrition care" in the Dietetic and
26 Nutrition Services Practice Act.
27 "Attending physician" means a physician licensed to
28 practice medicine in all of its branches providing care to
29 the individual. The attending physician for an individual
30 enrolled in a health maintenance organization is the
31 individual's primary care physician.
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1 "Qualified provider" for an individual that is enrolled
2 in:
3 (1) an insurance plan or health maintenance
4 organization that uses a primary care physician to
5 control access to specialty care means (A) the
6 individual's attending physician licensed to practice
7 medicine in all of its branches, (B) a network physician
8 licensed to practice medicine in all of its branches to
9 whom the individual has been referred by the attending
10 physician, or (C) a certified, registered, or licensed
11 network health care professional with expertise in
12 diabetes management to whom the individual has been
13 referred by the attending physician.
14 (2) an insurance plan means (A) a physician
15 licensed to practice medicine in all of its branches or
16 (B) a certified, registered, or licensed health care
17 professional with expertise in diabetes management to
18 whom the individual has been referred by the attending
19 physician.
20 (c) Coverage under this Section for diabetes
21 self-management training, including medical nutrition
22 education, shall be limited to the following:
23 (1) Up to 3 medically necessary visits, upon
24 initial diagnosis of diabetes by the patient's attending
25 physician, to a qualified provider.
26 (2) Up to 2 medically necessary visits, upon a
27 diagnosis by a patient's attending physician that
28 represents a significant change in the patient's symptoms
29 or condition, to a qualified provider.
30 Payment by the insurer or health maintenance
31 organization for the coverage required for diabetes
32 self-management training pursuant to the provisions of this
33 Section shall be required only upon certification by the
34 qualified provider providing the training that the patient
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1 has successfully completed diabetes self-management training.
2 Coverage under this subsection (c) for diabetes
3 self-management training shall be subject to the same
4 deductible, co-payment, and coinsurance provisions that apply
5 to coverage under the policy for other services provided by
6 the same type of provider.
7 (d) Coverage shall be provided for the following
8 medically necessary equipment when medically necessary and
9 prescribed by the attending physician licensed to practice
10 medicine in all of its branches if an individual's group
11 policy of accident and health insurance provides for a
12 durable medical equipment benefit. Coverage for the
13 following items shall be subject to deductible, co-payment
14 and co-insurance provisions provided for under the policy or
15 a durable medical equipment rider to the policy:
16 (1) blood glucose monitors;
17 (2) blood glucose monitors for the legally blind;
18 (3) cartridges for the legally blind;
19 (4) lancets and lancing devices; and
20 (e) Coverage shall be provided for the following
21 medically necessary pharmaceuticals and supplies when
22 medically necessary and prescribed by the attending physician
23 licensed to practice medicine in all of its branches if an
24 individual's group policy of accident and health insurance
25 provides for a drug benefit. Coverage for the following
26 items shall be subject to the same deductible, co-payment,
27 and co-insurance provisions under the policy or a drug rider
28 to the policy:
29 (1) insulin that is on the insurer's or health
30 maintenance organization's drug formulary;
31 (2) syringes and needles;
32 (3) test strips for glucose monitors; and
33 (4) FDA approved oral agents used to control blood
34 sugar that are on the insurer's or health maintenance
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1 organization's drug formulary.
2 (5) glucagon emergency kits.
3 (f) Coverage shall be provided for regular foot care
4 exams by the attending physician or by a network physician to
5 whom the attending physician has referred the patient.
6 Coverage for regular foot care exams shall subject to the
7 same deductible, co-payment, and co-insurance provisions that
8 apply under the policy for other services provided by the
9 same type of provider.
10 (g) If authorized by the attending physician, diabetes
11 self-management training may be provided as a part of an
12 office visit, group setting, or home visit.
13 (h) This Section shall not apply to agreements,
14 contracts, or policies that provide coverage for a specified
15 diagnosis or other limited benefit coverage.
16 (215 ILCS 5/370s new)
17 Sec. 370s. Diabetes self-management training. All
18 insurers and administrators are subject to Section 356w of
19 this Code.
20 Section 10. The Health Maintenance Organization Act is
21 amended by changing Section 5-3 as follows:
22 (215 ILCS 125/5-3) (from Ch. 111 1/2, par. 1411.2)
23 (Text of Section before amendment by P.A. 90-372)
24 Sec. 5-3. Insurance Code provisions.
25 (a) Health Maintenance Organizations shall be subject to
26 the provisions of Sections 133, 134, 137, 140, 141.1, 141.2,
27 141.3, 143, 143c, 147, 148, 149, 151, 152, 153, 154, 154.5,
28 154.6, 154.7, 154.8, 155.04, 355.2, 356m, 356v, 356w, 356t,
29 367i, 401, 401.1, 402, 403, 403A, 408, 408.2, and 412,
30 paragraph (c) of subsection (2) of Section 367, and Articles
31 VIII 1/2, XII, XII 1/2, XIII, XIII 1/2, and XXVI of the
-5- SRS990SB0086MNge
1 Illinois Insurance Code.
2 (b) For purposes of the Illinois Insurance Code, except
3 for Articles XIII and XIII 1/2, Health Maintenance
4 Organizations in the following categories are deemed to be
5 "domestic companies":
6 (1) a corporation authorized under the Medical
7 Service Plan Act, the Dental Service Plan Act, the
8 Pharmaceutical Service Plan Act, or the Voluntary Health
9 Services Plans Plan Act, or the Nonprofit Health Care
10 Service Plan Act;
11 (2) a corporation organized under the laws of this
12 State; or
13 (3) a corporation organized under the laws of
14 another state, 30% or more of the enrollees of which are
15 residents of this State, except a corporation subject to
16 substantially the same requirements in its state of
17 organization as is a "domestic company" under Article
18 VIII 1/2 of the Illinois Insurance Code.
19 (c) In considering the merger, consolidation, or other
20 acquisition of control of a Health Maintenance Organization
21 pursuant to Article VIII 1/2 of the Illinois Insurance Code,
22 (1) the Director shall give primary consideration
23 to the continuation of benefits to enrollees and the
24 financial conditions of the acquired Health Maintenance
25 Organization after the merger, consolidation, or other
26 acquisition of control takes effect;
27 (2)(i) the criteria specified in subsection (1)(b)
28 of Section 131.8 of the Illinois Insurance Code shall not
29 apply and (ii) the Director, in making his determination
30 with respect to the merger, consolidation, or other
31 acquisition of control, need not take into account the
32 effect on competition of the merger, consolidation, or
33 other acquisition of control;
34 (3) the Director shall have the power to require
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1 the following information:
2 (A) certification by an independent actuary of
3 the adequacy of the reserves of the Health
4 Maintenance Organization sought to be acquired;
5 (B) pro forma financial statements reflecting
6 the combined balance sheets of the acquiring company
7 and the Health Maintenance Organization sought to be
8 acquired as of the end of the preceding year and as
9 of a date 90 days prior to the acquisition, as well
10 as pro forma financial statements reflecting
11 projected combined operation for a period of 2
12 years;
13 (C) a pro forma business plan detailing an
14 acquiring party's plans with respect to the
15 operation of the Health Maintenance Organization
16 sought to be acquired for a period of not less than
17 3 years; and
18 (D) such other information as the Director
19 shall require.
20 (d) The provisions of Article VIII 1/2 of the Illinois
21 Insurance Code and this Section 5-3 shall apply to the sale
22 by any health maintenance organization of greater than 10% of
23 its enrollee population (including without limitation the
24 health maintenance organization's right, title, and interest
25 in and to its health care certificates).
26 (e) In considering any management contract or service
27 agreement subject to Section 141.1 of the Illinois Insurance
28 Code, the Director (i) shall, in addition to the criteria
29 specified in Section 141.2 of the Illinois Insurance Code,
30 take into account the effect of the management contract or
31 service agreement on the continuation of benefits to
32 enrollees and the financial condition of the health
33 maintenance organization to be managed or serviced, and (ii)
34 need not take into account the effect of the management
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1 contract or service agreement on competition.
2 (f) Except for small employer groups as defined in the
3 Small Employer Rating, Renewability and Portability Health
4 Insurance Act and except for medicare supplement policies as
5 defined in Section 363 of the Illinois Insurance Code, a
6 Health Maintenance Organization may by contract agree with a
7 group or other enrollment unit to effect refunds or charge
8 additional premiums under the following terms and conditions:
9 (i) the amount of, and other terms and conditions
10 with respect to, the refund or additional premium are set
11 forth in the group or enrollment unit contract agreed in
12 advance of the period for which a refund is to be paid or
13 additional premium is to be charged (which period shall
14 not be less than one year); and
15 (ii) the amount of the refund or additional premium
16 shall not exceed 20% of the Health Maintenance
17 Organization's profitable or unprofitable experience with
18 respect to the group or other enrollment unit for the
19 period (and, for purposes of a refund or additional
20 premium, the profitable or unprofitable experience shall
21 be calculated taking into account a pro rata share of the
22 Health Maintenance Organization's administrative and
23 marketing expenses, but shall not include any refund to
24 be made or additional premium to be paid pursuant to this
25 subsection (f)). The Health Maintenance Organization and
26 the group or enrollment unit may agree that the
27 profitable or unprofitable experience may be calculated
28 taking into account the refund period and the immediately
29 preceding 2 plan years.
30 The Health Maintenance Organization shall include a
31 statement in the evidence of coverage issued to each enrollee
32 describing the possibility of a refund or additional premium,
33 and upon request of any group or enrollment unit, provide to
34 the group or enrollment unit a description of the method used
-8- SRS990SB0086MNge
1 to calculate (1) the Health Maintenance Organization's
2 profitable experience with respect to the group or enrollment
3 unit and the resulting refund to the group or enrollment unit
4 or (2) the Health Maintenance Organization's unprofitable
5 experience with respect to the group or enrollment unit and
6 the resulting additional premium to be paid by the group or
7 enrollment unit.
8 In no event shall the Illinois Health Maintenance
9 Organization Guaranty Association be liable to pay any
10 contractual obligation of an insolvent organization to pay
11 any refund authorized under this Section.
12 (Source: P.A. 89-90, eff. 6-30-95; 90-25, eff. 1-1-98;
13 90-177, eff. 7-23-97; revised 11-21-97.)
14 (Text of Section after amendment by P.A. 90-372)
15 Sec. 5-3. Insurance Code provisions.
16 (a) Health Maintenance Organizations shall be subject to
17 the provisions of Sections 133, 134, 137, 140, 141.1, 141.2,
18 141.3, 143, 143c, 147, 148, 149, 151, 152, 153, 154, 154.5,
19 154.6, 154.7, 154.8, 155.04, 355.2, 356m, 356v, 356w, 356t,
20 367i, 401, 401.1, 402, 403, 403A, 408, 408.2, and 412,
21 paragraph (c) of subsection (2) of Section 367, and Articles
22 VIII 1/2, XII, XII 1/2, XIII, XIII 1/2, and XXVI of the
23 Illinois Insurance Code.
24 (b) For purposes of the Illinois Insurance Code, except
25 for Articles XIII and XIII 1/2, Health Maintenance
26 Organizations in the following categories are deemed to be
27 "domestic companies":
28 (1) a corporation authorized under the Medical
29 Service Plan Act, the Dental Service Plan Act or, the
30 Voluntary Health Services Plans Plan Act, or the
31 Nonprofit Health Care Service Plan Act;
32 (2) a corporation organized under the laws of this
33 State; or
34 (3) a corporation organized under the laws of
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1 another state, 30% or more of the enrollees of which are
2 residents of this State, except a corporation subject to
3 substantially the same requirements in its state of
4 organization as is a "domestic company" under Article
5 VIII 1/2 of the Illinois Insurance Code.
6 (c) In considering the merger, consolidation, or other
7 acquisition of control of a Health Maintenance Organization
8 pursuant to Article VIII 1/2 of the Illinois Insurance Code,
9 (1) the Director shall give primary consideration
10 to the continuation of benefits to enrollees and the
11 financial conditions of the acquired Health Maintenance
12 Organization after the merger, consolidation, or other
13 acquisition of control takes effect;
14 (2)(i) the criteria specified in subsection (1)(b)
15 of Section 131.8 of the Illinois Insurance Code shall not
16 apply and (ii) the Director, in making his determination
17 with respect to the merger, consolidation, or other
18 acquisition of control, need not take into account the
19 effect on competition of the merger, consolidation, or
20 other acquisition of control;
21 (3) the Director shall have the power to require
22 the following information:
23 (A) certification by an independent actuary of
24 the adequacy of the reserves of the Health
25 Maintenance Organization sought to be acquired;
26 (B) pro forma financial statements reflecting
27 the combined balance sheets of the acquiring company
28 and the Health Maintenance Organization sought to be
29 acquired as of the end of the preceding year and as
30 of a date 90 days prior to the acquisition, as well
31 as pro forma financial statements reflecting
32 projected combined operation for a period of 2
33 years;
34 (C) a pro forma business plan detailing an
-10- SRS990SB0086MNge
1 acquiring party's plans with respect to the
2 operation of the Health Maintenance Organization
3 sought to be acquired for a period of not less than
4 3 years; and
5 (D) such other information as the Director
6 shall require.
7 (d) The provisions of Article VIII 1/2 of the Illinois
8 Insurance Code and this Section 5-3 shall apply to the sale
9 by any health maintenance organization of greater than 10% of
10 its enrollee population (including without limitation the
11 health maintenance organization's right, title, and interest
12 in and to its health care certificates).
13 (e) In considering any management contract or service
14 agreement subject to Section 141.1 of the Illinois Insurance
15 Code, the Director (i) shall, in addition to the criteria
16 specified in Section 141.2 of the Illinois Insurance Code,
17 take into account the effect of the management contract or
18 service agreement on the continuation of benefits to
19 enrollees and the financial condition of the health
20 maintenance organization to be managed or serviced, and (ii)
21 need not take into account the effect of the management
22 contract or service agreement on competition.
23 (f) Except for small employer groups as defined in the
24 Small Employer Rating, Renewability and Portability Health
25 Insurance Act and except for medicare supplement policies as
26 defined in Section 363 of the Illinois Insurance Code, a
27 Health Maintenance Organization may by contract agree with a
28 group or other enrollment unit to effect refunds or charge
29 additional premiums under the following terms and conditions:
30 (i) the amount of, and other terms and conditions
31 with respect to, the refund or additional premium are set
32 forth in the group or enrollment unit contract agreed in
33 advance of the period for which a refund is to be paid or
34 additional premium is to be charged (which period shall
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1 not be less than one year); and
2 (ii) the amount of the refund or additional premium
3 shall not exceed 20% of the Health Maintenance
4 Organization's profitable or unprofitable experience with
5 respect to the group or other enrollment unit for the
6 period (and, for purposes of a refund or additional
7 premium, the profitable or unprofitable experience shall
8 be calculated taking into account a pro rata share of the
9 Health Maintenance Organization's administrative and
10 marketing expenses, but shall not include any refund to
11 be made or additional premium to be paid pursuant to this
12 subsection (f)). The Health Maintenance Organization and
13 the group or enrollment unit may agree that the
14 profitable or unprofitable experience may be calculated
15 taking into account the refund period and the immediately
16 preceding 2 plan years.
17 The Health Maintenance Organization shall include a
18 statement in the evidence of coverage issued to each enrollee
19 describing the possibility of a refund or additional premium,
20 and upon request of any group or enrollment unit, provide to
21 the group or enrollment unit a description of the method used
22 to calculate (1) the Health Maintenance Organization's
23 profitable experience with respect to the group or enrollment
24 unit and the resulting refund to the group or enrollment unit
25 or (2) the Health Maintenance Organization's unprofitable
26 experience with respect to the group or enrollment unit and
27 the resulting additional premium to be paid by the group or
28 enrollment unit.
29 In no event shall the Illinois Health Maintenance
30 Organization Guaranty Association be liable to pay any
31 contractual obligation of an insolvent organization to pay
32 any refund authorized under this Section.
33 (Source: P.A. 89-90, eff. 6-30-95; 90-25, eff. 1-1-98;
34 90-177, eff. 7-23-97; 90-372, eff. 7-1-98; revised 11-21-97.)
-12- SRS990SB0086MNge
1 Section 15. The Limited Health Service Organization Act
2 is amended by changing Section 3009 as follows:
3 (215 ILCS 130/3009) (from Ch. 73, par. 1503-9)
4 Sec. 3009. Point-of-service limited health service
5 contracts.
6 (a) An LHSO that offers a POS contract:
7 (1) shall include as in-plan covered services all
8 services required by law to be provided by an LHSO;
9 (2) shall provide incentives, which shall include
10 financial incentives, for enrollees to use in-plan
11 covered services;
12 (3) shall not offer services out-of-plan without
13 providing those services on an in-plan basis;
14 (4) may limit or exclude specific types of services
15 from coverage when obtained out-of-plan;
16 (5) may include annual out-of-pocket limits and
17 lifetime maximum benefits allowances for out-of-plan
18 services that are separate from any limits or allowances
19 applied to in-plan services;
20 (6) shall include an annual maximum benefit
21 allowance not to exceed $2,500 per year that is separate
22 from any limits or allowances applied to in-plan
23 services;
24 (7) may limit the groups to which a POS product is
25 offered, however, if a POS product is offered to a group,
26 then it must be offered to all eligible members of that
27 group, when an LHSO provider is available;
28 (8) shall not consider emergency services,
29 authorized referral services, or non-routine services
30 obtained out of the service area to be POS services; and
31 (9) may treat as out-of-plan services those
32 services that an enrollee obtains from a participating
33 provider, but for which the proper authorization was not
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1 given by the LHSO.
2 (b) An LHSO offering a POS contract shall be subject to
3 the following limitations:
4 (1) The LHSO shall not expend in any calendar
5 quarter more than 20% of its total limited health
6 services expenditures for all its members for out-of-plan
7 covered services.
8 (2) If the amount specified in paragraph (1) is
9 exceeded by 2% in a quarter, the LHSO shall effect
10 compliance with paragraph (1) by the end of the following
11 quarter.
12 (3) If compliance with the amount specified in
13 paragraph (1) is not demonstrated in the LHSO's next
14 quarterly report, the LHSO may not offer the POS contract
15 to new groups or include the POS option in the renewal of
16 an existing group until compliance with the amount
17 specified in paragraph (1) is demonstrated or otherwise
18 allowed by the Director.
19 (4) Any LHSO failing, without just cause, to comply
20 with the provisions of this subsection shall be required,
21 after notice and hearing, to pay a penalty of $250 for
22 each day out of compliance, to be recovered by the
23 Director of Insurance. Any penalty recovered shall be
24 paid into the General Revenue Fund. The Director may
25 reduce the penalty if the LHSO demonstrates to the
26 Director that the imposition of the penalty would
27 constitute a financial hardship to the LHSO.
28 (c) Any LHSO that offers a POS product shall:
29 (1) File a quarterly financial statement detailing
30 compliance with the requirements of subsection (b).
31 (2) Track out-of-plan POS utilization separately
32 from in-plan or non-POS out-of-plan emergency care,
33 referral care, and urgent care out of the service area
34 utilization.
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1 (3) Record out-of-plan utilization in a manner that
2 will permit such utilization and cost reporting as the
3 Director may, by regulation, require.
4 (4) Demonstrate to the Director's satisfaction that
5 the LHSO has the fiscal, administrative, and marketing
6 capacity to control its POS enrollment, utilization, and
7 costs so as not to jeopardize the financial security of
8 the LHSO.
9 (5) Maintain the deposit required by subsection (b)
10 of Section 2006 in addition to any other deposit required
11 under this Act.
12 (d) An LHSO shall not issue a POS contract until it has
13 filed and had approved by the Director a plan to comply with
14 the provisions of this Section. The compliance plan shall at
15 a minimum include provisions demonstrating that the LHSO will
16 do all of the following:
17 (1) Design the benefit levels and conditions of
18 coverage for in-plan covered services and out-of-plan
19 covered services as required by this Article.
20 (2) Provide or arrange for the provision of
21 adequate systems to:
22 (A) process and pay claims for all out-of-plan
23 covered services;
24 (B) meet the requirements for a POS contract
25 set forth in this Section and any additional
26 requirements that may be set forth by the Director;
27 and
28 (C) generate accurate data and financial and
29 regulatory reports on a timely basis so that the
30 Department can evaluate the LHSO's experience with
31 the POS contract and monitor compliance with POS
32 contract provisions.
33 (3) Comply initially and on an ongoing basis with
34 the requirements of subsections (b) and (c).
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1 (e) A limited health service organization that offers a
2 POS contract must comply with Section 356w of the Illinois
3 Insurance Code.
4 (Source: P.A. 87-1079; 88-667, eff. 9-16-94.)
5 Section 20. The Voluntary Health Services Plans Act is
6 amended by changing Section 10 as follows:
7 (215 ILCS 165/10) (from Ch. 32, par. 604)
8 Sec. 10. Application of Insurance Code provisions.
9 Health services plan corporations and all persons interested
10 therein or dealing therewith shall be subject to the
11 provisions of Article XII 1/2 and Sections 3.1, 133, 140,
12 143, 143c, 149, 354, 355.2, 356r, 356t, 356u, 356v, 356w,
13 367.2, 401, 401.1, 402, 403, 403A, 408, 408.2, and 412, and
14 paragraphs (7) and (15) of Section 367 of the Illinois
15 Insurance Code.
16 (Source: P.A. 89-514, eff. 7-17-96; 90-7, eff. 6-10-97;
17 90-25, eff. 1-1-98; revised 10-14-97.)
18 Section 95. No acceleration or delay. Where this Act
19 makes changes in a statute that is represented in this Act by
20 text that is not yet or no longer in effect (for example, a
21 Section represented by multiple versions), the use of that
22 text does not accelerate or delay the taking effect of (i)
23 the changes made by this Act or (ii) provisions derived from
24 any other Public Act.
25 Section 99. Effective date. This Act takes effect
26 January 1, 1999.