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| [ Introduced ] | [ Senate Amendment 002 ] |
91_SB0579eng SB579 Engrossed LRB9101022JSpc 1 AN ACT concerning the delivery of health care services. 2 Be it enacted by the People of the State of Illinois, 3 represented in the General Assembly: 4 Section 1. Short title. This Act may be cited as the 5 Managed Care Patient Rights Act. 6 Section 5. Health care patient rights. 7 (a) A patient has the right to care consistent with 8 professional standards of practice to assure quality nursing 9 and medical practices, to choose the participating physician 10 responsible for coordinating his or her care, to receive 11 information concerning his or her condition and proposed 12 treatment, to refuse any treatment to the extent permitted by 13 law, and to privacy and confidentiality of records except as 14 otherwise provided by law. 15 (b) A patient has the right, regardless of source of 16 payment, to examine and to receive a reasonable explanation 17 of his or her total bill for health care services rendered by 18 his or her physician or other health care provider, including 19 the itemized charges for specific health care services 20 received. A physician or other health care provider shall be 21 responsible only for a reasonable explanation of those 22 specific health care services provided by the health care 23 provider. 24 (c) A patient has the right to timely prior notice of 25 the termination in the event a health care plan cancels or 26 refuses to renew an enrollee's participation in the plan. 27 (d) A patient has the right to privacy and 28 confidentiality in health care. This right may be expressly 29 waived in writing by the patient or the patient's guardian. 30 (e) An individual has the right to purchase any health 31 care services with that individual's own funds. SB579 Engrossed -2- LRB9101022JSpc 1 (f) Nothing in this Section shall preclude the health 2 care plan from sharing information for plan quality 3 assessment and improvement purposes as required by Section 4 70. 5 Section 10. Definitions: 6 "Department" means the Department of Insurance. 7 "Emergency medical condition" means a medical condition 8 manifesting itself by acute symptoms of sufficient severity 9 (including, but not limited to, severe pain) such that a 10 prudent layperson, who possesses an average knowledge of 11 health and medicine, could reasonably expect the absence of 12 immediate medical attention to result in: 13 (1) placing the health of the individual (or, with 14 respect to a pregnant woman, the health of the woman or 15 her unborn child) in serious jeopardy; 16 (2) serious impairment to bodily functions; or 17 (3) serious dysfunction of any bodily organ or 18 part. 19 "Emergency medical screening examination" means a medical 20 screening examination and evaluation by a physician licensed 21 to practice medicine in all its branches, or to the extent 22 permitted by applicable laws, by other appropriately licensed 23 personnel under the supervision of or in collaboration with a 24 physician licensed to practice medicine in all its branches 25 to determine whether the need for emergency services exists. 26 "Emergency services" means, with respect to an enrollee 27 of a health plan, transportation services and covered 28 inpatient and outpatient hospital services furnished by a 29 provider qualified to furnish those services that are needed 30 to evaluate or stabilize an emergency medical condition. 31 "Emergency services" does not refer to post-stabilization 32 medical services. 33 "Enrollee" means any person and his or her dependents SB579 Engrossed -3- LRB9101022JSpc 1 enrolled in or covered by a health care plan. 2 "Health care plan" means a plan that establishes, 3 operates, or maintains a network of health care providers 4 that have entered into agreements with the plan to provide 5 health care services to enrollees to whom the plan has the 6 obligation to arrange for the provision of or payment for 7 services through organizational arrangements for ongoing 8 quality assurance, utilization review programs, or dispute 9 resolution. 10 For purposes of this definition, "health care plan" shall 11 not include the following: 12 (1) indemnity health insurance policies including 13 those using a contracted provider network; 14 (2) health care plans that offer only dental or 15 only vision coverage; 16 (3) preferred provider administrators, as defined 17 in Section 370g(g) of the Illinois Insurance Code; 18 (4) employee or employer self-insured health 19 benefit plans under the federal Employee Retirement 20 Income Security Act of 1974; and 21 (5) health care provided pursuant to the Workers' 22 Compensation Act or the Workers' Occupational Diseases 23 Act. 24 "Health care provider" means any physician, hospital 25 facility, or other person that is licensed or otherwise 26 authorized to deliver health care services. Nothing in this 27 Act shall be construed to define Independent Practice 28 Associations or Physician-Hospital Organizations as health 29 care providers. 30 "Health care services" means any services included in the 31 furnishing to any individual of medical care, or the 32 hospitalization incident to the furnishing of such care, as 33 well as the furnishing to any person of any and all other 34 services for the purpose of preventing, alleviating, curing, SB579 Engrossed -4- LRB9101022JSpc 1 or healing human illness or injury including home health and 2 pharmaceutical services and products. 3 "Medical director" means a physician licensed in any 4 state to practice medicine in all its branches appointed by a 5 health care plan. 6 "Person" means a corporation, association, partnership, 7 limited liability company, sole proprietorship, or any other 8 legal entity. 9 "Physician" means a person licensed under the Medical 10 Practice Act of 1987. 11 "Post-stabilization medical services" means health care 12 services provided to an enrollee that are furnished in a 13 licensed hospital by a provider that is qualified to furnish 14 such services, and determined to be medically necessary and 15 directly related to the emergency medical condition following 16 stabilization. 17 "Stabilization" means, with respect to an emergency 18 medical condition, to provide such medical treatment of the 19 condition as may be necessary to assure, within reasonable 20 medical probability, that no material deterioration of the 21 condition is likely to result. 22 "Utilization review" means the evaluation of the medical 23 necessity, appropriateness, and efficiency of the use of 24 health care services, procedures, and facilities. 25 "Utilization review program" means a program established 26 by a person to perform utilization review. 27 Section 15. Provision of information. 28 (a) A health care plan shall provide to enrollees and 29 prospective enrollees, upon request, a list of participating 30 health care providers in the health care plan's service area 31 and a description of the following terms of coverage: 32 (1) the service area; 33 (2) covered benefits and services, exclusions or SB579 Engrossed -5- LRB9101022JSpc 1 limitations; 2 (3) precertification and other utilization review 3 procedures and requirements; 4 (4) a description of the limitations on access to 5 specialists; 6 (5) emergency coverage and benefits; 7 (6) out-of-area coverages and benefits, if any; 8 (7) the enrollee's financial responsibility for 9 copayments, deductibles, and any other out-of-pocket 10 expenses; 11 (8) provisions for continuity of treatment in the 12 event a health care provider's participation terminates 13 during the course of an enrollee's treatment by that 14 provider; and 15 (9) the grievance process, including the telephone 16 number to call to receive information concerning 17 grievance procedures. 18 (b) Upon written request, a health care plan shall 19 provide to enrollees a description of the financial 20 relationships between the health care plan and any health 21 care provider, except that no health care plan shall be 22 required to disclose specific reimbursement to providers. 23 (c) A participating health care provider shall provide 24 all of the following, where applicable, to enrollees upon 25 request: 26 (1) Information related to the health care 27 provider's educational background, experience, training, 28 specialty, and board certification, if applicable. 29 (2) The names of licensed facilities on the 30 provider panel where the health care provider presently 31 has privileges for the treatment, illness, or procedure 32 that is the subject of the request. 33 (3) Information regarding the health care 34 provider's participation in continuing education programs SB579 Engrossed -6- LRB9101022JSpc 1 and compliance with any licensure, certification, or 2 registration requirements, if applicable. 3 (d) A health care plan shall provide the information 4 required to be disclosed under this Act in a legible and 5 understandable format consistent with the standards developed 6 for supplemental insurance coverage under Title XVIII of the 7 federal Social Security Act. 8 Section 20. Notice of nonrenewal or termination. A 9 health care plan must give at least 60 days notice of 10 nonrenewal or termination of a health care provider to the 11 health care provider and to the enrollees served by the 12 health care provider. The notice shall include a name and 13 address to which an enrollee or health care provider may 14 direct comments and concerns regarding the nonrenewal or 15 termination. Immediate written notice may be provided without 16 60 days notice when a health care provider's license has been 17 disciplined by a State licensing board. 18 Section 25. Transition of services. 19 (a) A health care plan shall provide for continuity of 20 care for its enrollees as follows: 21 (1) If an enrollee's physician leaves the health 22 care plan's network of health care providers for reasons 23 other than termination of a contract in situations 24 involving imminent harm to a patient or a final 25 disciplinary action by a State licensing board and the 26 physician remains within the health care plan's service 27 area, the health care plan shall permit the enrollee to 28 continue an ongoing course of treatment with that 29 physician during a transitional period: 30 (A) of 90 days from the date of the notice of 31 physician's termination from the health care plan to 32 the enrollee of the physician's disaffiliation from SB579 Engrossed -7- LRB9101022JSpc 1 the health care plan if the enrollee has an ongoing 2 course of treatment; or 3 (B) if the enrollee has entered the third 4 trimester of pregnancy at the time of the 5 physician's disaffiliation, that includes the 6 provision of post-partum care directly related to 7 the delivery. 8 (2) Notwithstanding the provisions in item (1) of 9 this subsection, such care shall be authorized by the 10 health care plan during the transitional period only if 11 the physician agrees: 12 (A) to continue to accept reimbursement from 13 the health care plan at the rates applicable prior 14 to the start of the transitional period; 15 (B) to adhere to the health care plan's 16 quality assurance requirements and to provide to the 17 health care plan necessary medical information 18 related to such care; and 19 (C) to otherwise adhere to the health care 20 plan's policies and procedures, including but not 21 limited to procedures regarding referrals and 22 obtaining preauthorizations for treatment. 23 (b) A health care plan shall provide for continuity of 24 care for new enrollees as follows: 25 (1) If a new enrollee whose physician is not a 26 member of the health care plan's provider network, but is 27 within the health care plan's service area, enrolls in 28 the health care plan, the health care plan shall permit 29 the enrollee to continue an ongoing course of treatment 30 with the enrollee's current physician during a 31 transitional period: 32 (A) of 90 days from the effective date of 33 enrollment if the enrollee has an ongoing course of 34 treatment; or SB579 Engrossed -8- LRB9101022JSpc 1 (B) if the enrollee has entered the third 2 trimester of pregnancy at the effective date of 3 enrollment, that includes the provision of 4 post-partum care directly related to the delivery. 5 (2) If an enrollee elects to continue to receive 6 care from such physician pursuant to item (1) of this 7 subsection, such care shall be authorized by the health 8 care plan for the transitional period only if the 9 physician agrees: 10 (A) to accept reimbursement from the health 11 care plan at rates established by the health care 12 plan; such rates shall be the level of reimbursement 13 applicable to similar physicians within the health 14 care plan for such services; 15 (B) to adhere to the health care plan's 16 quality assurance requirements and to provide to the 17 health care plan necessary medical information 18 related to such care; and 19 (C) to otherwise adhere to the health care 20 plan's policies and procedures including, but not 21 limited to procedures regarding referrals and 22 obtaining preauthorization for treatment. 23 (c) In no event shall this Section be construed to 24 require a health care plan to provide coverage for benefits 25 not otherwise covered or to diminish or impair preexisting 26 condition limitations contained in the enrollee's contract. 27 Section 30. Restraints on communications prohibited. 28 (a) No health care plan or its subcontractors may 29 prohibit or discourage health care providers by contract or 30 policy from discussing any health care services and health 31 care providers, utilization review and quality assurance 32 policies, terms and conditions of plans and plan policy with 33 enrollees, prospective enrollees, providers, or the public. SB579 Engrossed -9- LRB9101022JSpc 1 (b) Any violation of this Section shall be subject to 2 the penalties under this Act. 3 Section 35. Medically appropriate health care 4 protection. 5 (a) No health care plan or its subcontractors shall 6 retaliate against a physician or other health care provider 7 who advocates for appropriate health care services for 8 patients. 9 (b) It is the public policy of the State of Illinois 10 that a physician or any other health care provider be 11 encouraged to advocate for medically appropriate health care 12 services for his or her patients. For purposes of this 13 Section, "to advocate for medically appropriate health care 14 services" means to appeal a decision to deny payment for a 15 health care service pursuant to the reasonable grievance or 16 appeal procedure established by a health care plan or to 17 protest a decision, policy, or practice that the physician or 18 other health care provider, consistent with that degree of 19 learning and skill ordinarily possessed by physicians or 20 other health care providers practicing in the same or a 21 similar locality and under similar circumstances, reasonably 22 believes impairs the physician's or other health care 23 provider's ability to provide appropriate health care 24 services to his or her patients. 25 (c) This Section shall not be construed to prohibit a 26 health care plan or its subcontractors from making a 27 determination not to pay for a particular health care service 28 or to prohibit a medical group, independent practice 29 association, preferred provider organization, foundation, 30 hospital medical staff, hospital governing body or health 31 care plan from enforcing reasonable peer review or 32 utilization review protocols or determining whether a 33 physician or other health care provider has complied with SB579 Engrossed -10- LRB9101022JSpc 1 those protocols. 2 (d) Nothing in this Section shall be construed to 3 prohibit the governing body of a hospital or the hospital 4 medical staff from taking disciplinary actions against a 5 physician as authorized by law. 6 (e) Nothing in this Section shall be construed to 7 prohibit the Department of Professional Regulation from 8 taking disciplinary actions against a physician or other 9 health care provider under the appropriate licensing Act. 10 Section 40. Access to specialists. 11 (a) All health care plans that require each enrollee to 12 select a health care provider for any purpose including 13 coordination of care shall ensure that any enrollee may 14 choose any primary care physician licensed to practice 15 medicine in all its branches participating in the health care 16 plan for that purpose. The health care plan shall provide the 17 enrollee with a choice of licensed health care providers who 18 are accessible and qualified. Nothing in this Act shall be 19 construed to prohibit a health care plan from requiring a 20 health care provider to meet the health care plan's criteria 21 in order to coordinate access to health care. 22 (b) A health care plan shall establish a procedure by 23 which an enrollee who has a condition that requires ongoing 24 care from a specialist physician or other health care 25 provider may apply for a standing referral to a specialist 26 physician or other health care provider if a referral to a 27 specialist physician or other health care provider is 28 required for coverage. The application shall be made to the 29 enrollee's primary care physician. This procedure for a 30 standing referral must specify the necessary criteria and 31 conditions that must be met in order for an enrollee to 32 obtain a standing referral. A standing referral shall be 33 effective for the period necessary to provide the referred SB579 Engrossed -11- LRB9101022JSpc 1 services or one year, except in the event of termination of a 2 contract or policy in which case Section 25 on transition of 3 services shall apply, if applicable. A primary care physician 4 may renew a standing referral. 5 (c) The enrollee may be required by the health care plan 6 to select a specialist physician or other health care 7 provider who has a referral arrangement with the enrollee's 8 primary care physician or to select a new primary care 9 physician who has a referral arrangement with the specialist 10 physician or other health care provider chosen by the 11 enrollee. If a health care plan requires an enrollee to 12 select a new physician under this subsection, the health care 13 plan must provide the enrollee with both options provided in 14 this subsection. 15 (d) When the type of specialist physician or other 16 health care provider needed to provide ongoing care for a 17 specific condition is not represented in the health care 18 plan's provider network, the primary care physician shall 19 arrange for the enrollee to have access to a qualified 20 non-participating health care provider within a reasonable 21 distance and travel time. The referring physician shall 22 notify the plan when a referral is made outside the network. 23 (e) The enrollee's primary care physician shall remain 24 responsible for coordinating the care of an enrollee who has 25 received a standing referral to a specialist physician or 26 other health care provider. If a secondary referral is 27 necessary, the specialist physician or other health care 28 provider shall advise the primary care physician. The 29 primary care physician shall be responsible for making the 30 secondary referral. In addition, the health care plan shall 31 require the specialist physician or other health care 32 provider to provide regular updates to the enrollee's primary 33 care physician. 34 (f) If an enrollee's application for any referral is SB579 Engrossed -12- LRB9101022JSpc 1 denied, an enrollee may appeal the decision through the 2 health care plan's medical necessity second opinion process 3 in accordance with Section 45 of this Act. 4 Section 45. Medical necessity; second opinion. A health 5 care plan shall provide a mechanism for the timely review by 6 a physician or other health care provider holding the same 7 class of license as the patient's physician or other health 8 care provider, who is unaffiliated with the health care plan, 9 jointly selected by the patient (or the patient's next of kin 10 or legal representative if the patient is unable to act for 11 himself), the patient's physician or other health care 12 provider, and the health care plan in the event of a dispute 13 between the patient's physician or other health care provider 14 and the health care plan regarding the medical necessity of a 15 service or a referral. If the reviewing physician or other 16 health care provider determines the service to be medically 17 necessary or the referral to be appropriate, the health care 18 plan shall pay for the service. Future contractual or 19 employment action by the health care plan regarding the 20 patient's physician or other health care provider shall not 21 be based solely on the physician's or other health care 22 provider's participation in this procedure. 23 Section 50. Choosing a physician. 24 (a) A health care plan may also offer other arrangements 25 under which enrollees may access health care services from 26 contracted providers without a referral or authorization from 27 their primary care physician. 28 (b) The enrollee may be required by the health care plan 29 to select a specialist physician or other health care 30 provider who has a referral arrangement with the enrollee's 31 primary care physician or to select a new primary care 32 physician who has a referral arrangement with the specialist SB579 Engrossed -13- LRB9101022JSpc 1 physician or other health care provider chosen by the 2 enrollee. If a health care plan requires an enrollee to 3 select a new physician under this subsection, the health care 4 plan must provide the enrollee with both options provided in 5 this subsection. 6 (c) The Director of Insurance and the Department of 7 Public Health each may promulgate rules to ensure appropriate 8 access to and quality of care for enrollees in any plan that 9 allows enrollees to access health care services from 10 contractual providers without a referral or authorization 11 from the primary care physician. The rules may include, but 12 shall not be limited to, a system for the retrieval and 13 compilation of enrollees' medical records. 14 Section 55. Emergency services prior to stabilization. 15 (a) A health care plan that provides or that is required 16 by law to provide coverage for emergency services shall 17 provide coverage such that payment under this coverage is not 18 dependent upon whether the services are performed by a plan 19 or non-plan health care provider and without regard to prior 20 authorization. This coverage shall be at the same benefit 21 level as if the services or treatment had been rendered by 22 the health care plan physician licensed to practice medicine 23 in all its branches or health care provider. 24 (b) Prior authorization or approval by the plan shall 25 not be required for emergency services. 26 (c) Coverage and payment shall not be retrospectively 27 denied, with the following exceptions: 28 (1) upon reasonable determination that the 29 emergency services claimed were never performed; 30 (2) upon determination that the emergency 31 evaluation and treatment were rendered to an enrollee who 32 sought emergency services and whose circumstance did not 33 meet the definition of emergency medical condition; SB579 Engrossed -14- LRB9101022JSpc 1 (3) upon determination that the patient receiving 2 such services was not an enrollee of the health care 3 plan; or 4 (4) upon material misrepresentation by the enrollee 5 or health care provider; "material" means a fact or 6 situation that is not merely technical in nature and 7 results or could result in a substantial change in the 8 situation. 9 (d) When an enrollee presents to a hospital seeking 10 emergency services, the determination as to whether the need 11 for those services exists shall be made for purposes of 12 treatment by a physician licensed to practice medicine in 13 all its branches or, to the extent permitted by applicable 14 law, by other appropriately licensed personnel under the 15 supervision of or in collaboration with a physician licensed 16 to practice medicine in all its branches. The physician or 17 other appropriate personnel shall indicate in the patient's 18 chart the results of the emergency medical screening 19 examination. 20 (e) The appropriate use of the 911 emergency telephone 21 system or its local equivalent shall not be discouraged or 22 penalized by the health care plan when an emergency medical 23 condition exists. This provision shall not imply that the use 24 of 911 or its local equivalent is a factor in determining the 25 existence of an emergency medical condition. 26 (f) The medical director's or his or her designee's 27 determination of whether the enrollee meets the standard of 28 an emergency medical condition shall be based solely upon the 29 presenting symptoms documented in the medical record at the 30 time care was sought. 31 (g) Nothing in this Section shall prohibit the 32 imposition of deductibles, co-payments, and co-insurance. 33 Section 60. Post-stabilization medical services. SB579 Engrossed -15- LRB9101022JSpc 1 (a) If prior authorization for covered post-stabilization 2 services is required by the health care plan, the plan shall 3 provide access 24 hours a day, 7 days a week to persons 4 designated by the plan to make such determinations. 5 (b) The treating physician licensed to practice medicine 6 in all its branches or health care provider shall contact 7 the health care plan or delegated health care provider as 8 designated on the enrollee's health insurance card to obtain 9 authorization, denial, or arrangements for an alternate plan 10 of treatment or transfer of the enrollee. 11 (c) The treating physician licensed to practice 12 medicine in all its branches or health care provider shall 13 document in the enrollee's medical record the enrollee's 14 presenting symptoms; emergency medical condition; and time, 15 phone number dialed, and result of the communication for 16 request for authorization of post-stabilization medical 17 services. The health care plan shall provide reimbursement 18 for covered post-stabilization medical services if: 19 (1) authorization to render them is received from 20 the health care plan or its delegated health care 21 provider, or 22 (2) after 2 documented good faith efforts, the 23 treating health care provider has attempted to contact 24 the enrollee's health care plan or its delegated health 25 care provider, as designated on the enrollee's health 26 insurance card, for prior authorization of 27 post-stabilization medical services and neither the plan 28 nor designated persons were accessible or the 29 authorization was not denied within 60 minutes of the 30 request. "Two documented good faith efforts" means the 31 health care provider has called the telephone number on 32 the enrollee's health insurance card or other available 33 number either 2 times or one time and an additional call 34 to any referral number provided. "Good faith" means SB579 Engrossed -16- LRB9101022JSpc 1 honesty of purpose, freedom from intention to defraud, 2 and being faithful to one's duty or obligation. For the 3 purpose of this Act, good faith shall be presumed. 4 (d) After rendering any post-stabilization medical 5 services, the treating physician licensed to practice 6 medicine in all its branches or health care provider shall 7 continue to make every reasonable effort to contact the 8 health care plan or its delegated health care provider 9 regarding authorization, denial, or arrangements for an 10 alternate plan of treatment or transfer of the enrollee until 11 the treating health care provider receives instructions from 12 the health care plan or delegated health care provider for 13 continued care or the care is transferred to another health 14 care provider or the patient is discharged. 15 (e) Payment for covered post-stabilization services may 16 be denied: 17 (1) if the treating health care provider does not 18 meet the conditions outlined in subsection (c); 19 (2) upon determination that the post-stabilization 20 services claimed were not performed; 21 (3) upon determination that the post-stabilization 22 services rendered were contrary to the instructions of 23 the health care plan or its delegated health care 24 provider if contact was made between those parties prior 25 to the service being rendered; 26 (4) upon determination that the patient receiving 27 such services was not an enrollee of the health care 28 plan; or 29 (5) upon material misrepresentation by the enrollee 30 or health care provider; "material" means a fact or 31 situation that is not merely technical in nature and 32 results or could result in a substantial change in the 33 situation. 34 (f) Nothing in this Section prohibits a health care plan SB579 Engrossed -17- LRB9101022JSpc 1 from delegating tasks associated with the responsibilities 2 enumerated in this Section to the health care plan's 3 contracted health care providers or another entity. 4 However, the ultimate responsibility for coverage and payment 5 decisions may not be delegated. 6 (g) Coverage and payment for post-stabilization medical 7 services for which prior authorization or deemed approval is 8 received shall not be retrospectively denied. 9 (h) Nothing in this Section shall prohibit the 10 imposition of deductibles, co-payments, and co-insurance. 11 Section 65. Consumer advisory committee. 12 (a) A health care plan shall establish a consumer 13 advisory committee. The consumer advisory committee shall 14 have the authority to identify and review consumer concerns 15 and make advisory recommendations to the health care plan. 16 The health care plan may also make requests of the consumer 17 advisory committee to provide feedback to proposed changes in 18 plan policies and procedures which will affect enrollees. 19 However, the consumer advisory committee shall not have the 20 authority to hear or resolve specific complaints or 21 grievances, but instead shall refer such complaints or 22 grievances to the health care plan's grievance committee. 23 (b) The health care plan shall randomly select 8 24 enrollees meeting the requirements of this Section to serve 25 on the consumer advisory committee. Upon initial formation 26 of the consumer advisory committee, the health care plan 27 shall appoint 4 enrollees to a 2 year term and 4 enrollees to 28 a one year term. Thereafter, as an enrollee's term expires, 29 the health care plan shall re-appoint or appoint an enrollee 30 to serve on the consumer advisory committee for a 2 year 31 term. Members of the consumer advisory committee shall by 32 majority vote elect a member of the committee to serve as 33 chair of the committee. SB579 Engrossed -18- LRB9101022JSpc 1 (c) An enrollee may not serve on the consumer advisory 2 committee if during the 2 years preceding service the 3 enrollee: 4 (1) has been an employee, officer, or director of 5 the plan, an affiliate of the plan, or a provider or 6 affiliate of a provider that furnishes health care 7 services to the plan or affiliate of the plan; or 8 (2) is a relative of a person specified in item 9 (1). 10 (d) A health care plan's consumer advisory committee 11 shall meet not less than quarterly. 12 (e) All meetings shall be held within the State of 13 Illinois. The costs of the meetings shall be borne by the 14 health care plan. 15 Section 70. Quality assessment program. 16 (a) A health care plan shall develop and implement a 17 quality assessment and improvement strategy designed to 18 identify and evaluate accessibility, continuity, and quality 19 of care. The health care plan shall have: 20 (1) an ongoing, written, internal quality 21 assessment program; 22 (2) specific written guidelines for monitoring and 23 evaluating the quality and appropriateness of care and 24 services provided to enrollees requiring the health care 25 plan to assess: 26 (A) the accessibility to health care 27 providers; 28 (B) appropriateness of utilization; 29 (C) concerns identified by the health care 30 plan's medical or administrative staff and 31 enrollees; and 32 (D) other aspects of care and service directly 33 related to the improvement of quality of care; SB579 Engrossed -19- LRB9101022JSpc 1 (3) a procedure for remedial action to correct 2 quality problems that have been verified in accordance 3 with the written plan's methodology and criteria, 4 including written procedures for taking appropriate 5 corrective action; 6 (4) follow-up measures implemented to evaluate the 7 effectiveness of the action plan. 8 (b) The health care plan shall establish a committee 9 that oversees the quality assessment and improvement strategy 10 which includes physician and enrollee participation. 11 (c) Reports on quality assessment and improvement 12 activities shall be made to the governing body of the health 13 care plan not less than quarterly. 14 (d) The health care plan shall make available its 15 written description of the quality assessment program to the 16 Department of Public Health. 17 (e) With the exception of subsection (d), the Department 18 of Public Health shall accept evidence of accreditation with 19 regard to the health care network quality management and 20 performance improvement standards of: 21 (1) the National Commission on Quality Assurance 22 (NCQA); 23 (2) the American Accreditation Healthcare 24 Commission (URAC); 25 (3) the Joint Commission on Accreditation of 26 Healthcare Organizations (JCAHO); or 27 (4) any other entity that the Director of Public 28 Health deems has substantially similar or more stringent 29 standards than provided for in this Section. 30 Section 75. Complaints. 31 (a) A health care plan shall establish and maintain a 32 complaint system providing reasonable procedures for 33 resolving complaints initiated by enrollees (complainant) SB579 Engrossed -20- LRB9101022JSpc 1 which shall provide for an expedited review of cases 2 involving imminent threat to the health of an enrollee. 3 Nothing in this Act shall be construed to preclude an 4 enrollee from filing a complaint with the Department or as 5 limiting the Department's ability to investigate complaints. 6 In addition, any enrollee not satisfied with the plan's 7 resolution of any complaint may appeal that final plan 8 decision to the Department. 9 (b) When a complaint against a health care plan 10 (respondent) is received by the Department, the respondent 11 shall be notified of the complaint. The Department shall, in 12 its notification, specify the date when a report is to be 13 received from the respondent, which shall be no later than 21 14 days after notification is sent to the respondent. A failure 15 to reply by the date specified may be followed by a collect 16 telephone call or collect telegram. Repeated instances of 17 failing to reply by the date specified may result in further 18 regulatory action. 19 (c) The respondent's report shall supply adequate 20 documentation that explains all actions taken or not taken 21 and that were the basis for the complaint. The report shall 22 include documents necessary to support the respondent's 23 position and any information requested by the Department. The 24 respondent's reply shall be in duplicate, but duplicate 25 copies of supporting documents shall not be required. The 26 respondent's reply shall include the name, telephone number, 27 and address of the individual assigned to investigate or 28 process the complaint. The Department shall respect the 29 confidentiality of medical reports and other documents that 30 by law are confidential. Any other information furnished by 31 a respondent shall be marked "confidential" if the respondent 32 does not wish it to be released to the complainant. 33 (d) The Department shall review the plan decision to 34 determine whether it is consistent with the plan and Illinois SB579 Engrossed -21- LRB9101022JSpc 1 law and rules. 2 (e) Upon receipt of the respondent's report, the 3 Department shall evaluate the material submitted; and 4 (1) advise the complainant of the action taken and 5 disposition of its complaint; 6 (2) pursue further investigation with respondent or 7 complainant; or 8 (3) refer the investigation report to the 9 appropriate branch within the Department for further 10 regulatory action. 11 (f) The Department of Insurance and the Department of 12 Public Health shall coordinate the complaint review and 13 investigation process. The Department of Insurance and the 14 Department of Public Health shall jointly establish rules 15 under the Illinois Administrative Procedure Act implementing 16 this complaint process. 17 Section 80. Record of complaints. 18 (a) The Department shall maintain records concerning the 19 complaints filed against health care plans with the 20 Department and shall require health care plans to annually 21 report complaints made to and resolutions by health care 22 plans in a manner determined by rule. The Department shall 23 make a summary of all data collected available upon request 24 and publish the summary on the World Wide Web. 25 (b) The Department shall maintain records on the number 26 of complaints filed against each health care plan. 27 (c) The Department shall maintain records classifying 28 each complaint by whether the complaint was filed by: 29 (1) a consumer or enrollee; 30 (2) a provider; or 31 (3) any other individual. 32 (d) The Department shall maintain records classifying 33 each complaint according to the nature of the complaint as it SB579 Engrossed -22- LRB9101022JSpc 1 pertains to a specific function of the health care plan. The 2 complaints shall be classified under the following 3 categories: 4 (1) denial of care or treatment; 5 (2) denial of a diagnostic procedure; 6 (3) denial of a referral request; 7 (4) sufficient choice and accessibility of health 8 care providers; 9 (5) underwriting; 10 (6) marketing and sales; 11 (7) claims and utilization review; 12 (8) member services; 13 (9) provider relations; and 14 (10) miscellaneous. 15 (e) The Department shall maintain records classifying 16 the disposition of each complaint. The disposition of the 17 complaint shall be classified in one of the following 18 categories: 19 (1) complaint referred to the health care plan and 20 no further action necessary by the Department; 21 (2) no corrective action deemed necessary by the 22 Department; or 23 (3) corrective action taken by the Department. 24 (f) No Department publication or release of information 25 shall identify any enrollee, health care provider, or 26 individual complainant. 27 Section 85. Utilization review program registration. 28 (a) No person may conduct a utilization review program 29 in this State unless once every 2 years the person registers 30 the utilization review program with the Department and 31 certifies compliance with all of the Health Utilization 32 Management Standards of the American Accreditation Healthcare 33 Commission (URAC) or submits evidence of accreditation by the SB579 Engrossed -23- LRB9101022JSpc 1 American Accreditation Healthcare Commission (URAC) for its 2 Health Utilization Management Standards. 3 (b) In addition, the Director of the Department, in 4 consultation with the Director of the Department of Public 5 Health, may certify alternative utilization review standards 6 of national accreditation organizations or entities in order 7 for plans to comply with this Section. Any alternative 8 utilization review standards shall meet or exceed those 9 standards required under subsection (a). 10 (c) The provisions of this Section do not apply to: 11 (1) persons providing utilization review program 12 services only to the federal government; 13 (2) self-insured health plans under the federal 14 Employee Retirement Income Security Act of 1974, however, 15 this Section does apply to persons conducting a 16 utilization review program on behalf of these health 17 plans; 18 (3) hospitals and medical groups performing 19 utilization review activities for internal purposes 20 unless the utilization review program is conducted for 21 another person. 22 Nothing in this Act prohibits a health care plan or other 23 entity from contractually requiring an entity designated in 24 item (3) of this subsection to adhere to the utilization 25 review program requirements of this Act. 26 (d) This registration shall include submission of all of 27 the following information regarding utilization review 28 program activities: 29 (1) The name, address, and telephone number of the 30 utilization review programs. 31 (2) The organization and governing structure of the 32 utilization review programs. 33 (3) The number of lives for which utilization 34 review is conducted by each utilization review program. SB579 Engrossed -24- LRB9101022JSpc 1 (4) Hours of operation of each utilization review 2 program. 3 (5) Description of the grievance process for each 4 utilization review program. 5 (6) Number of covered lives for which utilization 6 review was conducted for the previous calendar year for 7 each utilization review program. 8 (7) Written policies and procedures for protecting 9 confidential information according to applicable State 10 and federal laws for each utilization review program. 11 (e) If the Department finds that a utilization review 12 program is not in compliance with this Section, the 13 Department shall issue a corrective action plan and allow a 14 reasonable amount of time for compliance with the plan. If 15 the utilization review program does not come into compliance, 16 the Department may issue a cease and desist order. Before 17 issuing a cease and desist order under this Section, the 18 Department shall provide the utilization review program with 19 a written notice of the reasons for the order and allow a 20 reasonable amount of time to supply additional information 21 demonstrating compliance with requirements of this Section 22 and to request a hearing. The hearing notice shall be sent 23 by certified mail, return receipt requested, and the hearing 24 shall be conducted in accordance with the Illinois 25 Administrative Procedure Act. 26 (f) A utilization review program subject to a corrective 27 action may continue to conduct business until a final 28 decision has been issued by the Department. 29 Section 90. Prohibited activity. No health care plan or 30 its subcontractors by contract, written policy, or procedure 31 shall contain any clause attempting to transfer or 32 transferring to a health care provider by indemnification, 33 hold harmless, or contribution requirements concerning any SB579 Engrossed -25- LRB9101022JSpc 1 liability relating to activities, actions, or omissions of 2 the health care plan or its officers, employees, or agents. 3 Nothing in this Section shall relieve any person or health 4 care provider from liability for his, her, or its own 5 negligence in the performance of his, her, or its duties 6 arising from treatment of a patient. The Illinois General 7 Assembly finds it to be against public policy for a person to 8 transfer liability in such a manner. 9 Section 95. Prohibition of waiver of rights. No health 10 care plan or contract shall contain any provision, policy, or 11 procedure that limits, restricts, or waives any of the rights 12 set forth in this Act. Any such policy or procedure shall be 13 void and unenforceable. 14 Section 100. Administration and enforcement. The 15 Director of Insurance may adopt rules necessary to implement 16 the Department's responsibilities under this Act. 17 To enforce the provisions of this Act, the Director may 18 issue a cease and desist order or require a health care plan 19 to submit a plan of correction for violations of this Act, or 20 both. Subject to the provisions of the Illinois 21 Administrative Procedure Act, the Director may impose an 22 administrative fine on a health care plan of up to $5,000 for 23 failure to submit a requested plan of correction, failure to 24 comply with its plan of correction, or repeated violations of 25 the Act. 26 Section 105. Applicability and scope. This Act applies 27 to policies and contracts amended, delivered, issued, or 28 renewed on or after the effective date of this Act. This Act 29 does not diminish a health care plan's duties and 30 responsibilities under other federal or State law or rules 31 promulgated thereunder. SB579 Engrossed -26- LRB9101022JSpc 1 Section 110. Effect on benefits under Workers' 2 Compensation Act and Workers' Occupational Diseases Act. 3 Nothing in this Act shall be construed to expand, modify, or 4 restrict the health care benefits provided to employees under 5 the Workers' Compensation Act and Workers' Occupational 6 Diseases Act. 7 Section 115. Severability. The provisions of this Act 8 are severable under Section 1.31 of the Statute on Statutes. 9 Section 200. The State Employees Group Insurance Act of 10 1971 is amended by adding Section 6.12 as follows: 11 (5 ILCS 375/6.12 new) 12 Sec. 6.12. Managed Care Patient Rights Act. The program 13 of health benefits is subject to the provisions of the 14 Managed Care Patient Rights Act. 15 Section 205. The State Mandates Act is amended by adding 16 Section 8.23 as follows: 17 (30 ILCS 805/8.23 new) 18 Sec. 8.23. Exempt mandate. Notwithstanding Sections 6 19 and 8 of this Act, no reimbursement by the State is required 20 for the implementation of any mandate created by this 21 amendatory Act of 1999. 22 Section 210. The Counties Code is amended by adding 23 Section 5-1069.8 as follows: 24 (55 ILCS 5/5-1069.8 new) 25 Sec. 5-1069.8. Managed Care Patient Rights Act. All 26 counties, including home rule counties, are subject to the 27 provisions of the Managed Care Patient Rights Act. The SB579 Engrossed -27- LRB9101022JSpc 1 requirement under this Section that health care benefits 2 provided by counties comply with the Managed Care Patient 3 Rights Act is an exclusive power and function of the State 4 and is a denial and limitation of home rule county powers 5 under Article VII, Section 6, subsection (h) of the Illinois 6 Constitution. 7 Section 215. The Illinois Municipal Code is amended by 8 adding Section 10-4-2.8 as follows: 9 (65 ILCS 5/10-4-2.8 new) 10 Sec. 10-4-2.8. Managed Care Patient Rights Act. The 11 corporate authorities of all municipalities are subject to 12 the provisions of the Managed Care Patient Rights Act. The 13 requirement under this Section that health care benefits 14 provided by municipalities comply with the Managed Care 15 Patient Rights Act is an exclusive power and function of the 16 State and is a denial and limitation of home rule 17 municipality powers under Article VII, Section 6, subsection 18 (h) of the Illinois Constitution. 19 Section 220. The Illinois Insurance Code is amended by 20 changing Section 370g and adding Sections 155.36, 370s and 21 511.118 as follows: 22 (215 ILCS 5/155.36 new) 23 Sec. 155.36. Managed Care Patient Rights Act. Insurance 24 companies that transact the kinds of insurance authorized 25 under Class 1(b) or Class 2(a) of Section 4 of this Code 26 shall comply with Section 85 and the definition of the term 27 "emergency medical condition" in Section 10 of the Managed 28 Care Patient Rights Act. 29 (215 ILCS 5/370g) (from Ch. 73, par. 982g) SB579 Engrossed -28- LRB9101022JSpc 1 Sec. 370g. Definitions. As used in this Article, the 2 following definitions apply: 3 (a) "Health care services" means health care services or 4 products rendered or sold by a provider within the scope of 5 the provider's license or legal authorization. The term 6 includes, but is not limited to, hospital, medical, surgical, 7 dental, vision and pharmaceutical services or products. 8 (b) "Insurer" means an insurance company or a health 9 service corporation authorized in this State to issue 10 policies or subscriber contracts which reimburse for expenses 11 of health care services. 12 (c) "Insured" means an individual entitled to 13 reimbursement for expenses of health care services under a 14 policy or subscriber contract issued or administered by an 15 insurer. 16 (d) "Provider" means an individual or entity duly 17 licensed or legally authorized to provide health care 18 services. 19 (e) "Noninstitutional provider" means any person 20 licensed under the Medical Practice Act of 1987, as now or 21 hereafter amended. 22 (f) "Beneficiary" means an individual entitled to 23 reimbursement for expenses of or the discount of provider 24 fees for health care services under a program where the 25 beneficiary has an incentive to utilize the services of a 26 provider which has entered into an agreement or arrangement 27 with an administrator. 28 (g) "Administrator" means any person, partnership or 29 corporation, other than an insurer or health maintenance 30 organization holding a certificate of authority under the 31 "Health Maintenance Organization Act", as now or hereafter 32 amended, that arranges, contracts with, or administers 33 contracts with a provider whereby beneficiaries are provided 34 an incentive to use the services of such provider. SB579 Engrossed -29- LRB9101022JSpc 1 (h) "Emergency medical condition" means a medical 2 condition manifesting itself by acute symptoms of sufficient 3 severity (including severe pain) such that a prudent 4 layperson, who possesses an average knowledge of health and 5 medicine, could reasonably expect the absence of immediate 6 medical attention to result in: 7 (1) placing the health of the individual (or, with 8 respect to a pregnant woman, the health of the woman or 9 her unborn child) in serious jeopardy; 10 (2) serious impairment to bodily functions; or 11 (3) serious dysfunction of any bodily organ or 12 part."Emergency" means an accidental bodily injury or13emergency medical condition which reasonably requires the14beneficiary or insured to seek immediate medical care15under circumstances or at locations which reasonably16preclude the beneficiary or insured from obtaining needed17medical care from a preferred provider.18 (Source: P.A. 88-400.) 19 (215 ILCS 5/370s new) 20 Sec. 370s. Managed Care Patient Rights Act. All 21 administrators shall comply with Sections 80 and 85 of the 22 Managed Care Patient Rights Act. 23 (215 ILCS 5/511.118 new) 24 Sec. 511.118. Managed Care Patient Rights Act. All 25 administrators are subject to the provisions of Sections 80 26 and 85 of the Managed Care Patient Rights Act. 27 Section 225. The Comprehensive Health Insurance Plan Act 28 is amended by adding Section 8.6 as follows: 29 (215 ILCS 105/8.6 new) 30 Sec. 8.6. Managed Care Patient Rights Act. The plan is SB579 Engrossed -30- LRB9101022JSpc 1 subject to the provisions of the Managed Care Patient Rights 2 Act. 3 Section 230. The Health Care Purchasing Group Act is 4 amended by changing Sections 15 and 20 as follows: 5 (215 ILCS 123/15) 6 Sec. 15. Health care purchasing groups; membership; 7 formation. 8 (a) An HPG may be an organization formed by 2 or more 9 employers with no more than 500 covered employees each2,50010covered individuals, an HPG sponsor or a risk-bearer for 11 purposes of contracting for health insurance under this Act 12 to cover employees and dependents of HPG members. An HPG 13 shall not be prevented from supplementing health insurance 14 coverage purchased under this Act by contracting for services 15 from entities licensed and authorized in Illinois to provide 16 those services under the Dental Service Plan Act, the Limited 17 Health Service Organization Act, or Voluntary Health Services 18 Plans Act. An HPG may be a separate legal entity or simply a 19 group of 2 or more employers with no more than 500 covered 20 employees each2,500 covered individualsaggregated under 21 this Act by an HPG sponsor or risk-bearer for insurance 22 purposes. There shall be no limit as to the number of HPGs 23 that may operate in any geographic area of the State. No 24 insurance risk may be borne or retained by the HPG. All 25 health insurance contracts issued to the HPG must be 26 delivered or issued for delivery in Illinois. 27 (b) Members of an HPG must be Illinois domiciled 28 employers, except that an employer domiciled elsewhere may 29 become a member of an Illinois HPG for the sole purpose of 30 insuring its employees whose place of employment is located 31 within this State. HPG membership may include employers 32 having no more than 500 covered employees each2,500 coveredSB579 Engrossed -31- LRB9101022JSpc 1individuals. 2 (c) If an HPG is formed by any 2 or more employers with 3 no more than 500 covered employees each2,500 covered4individuals, it is authorized to negotiate, solicit, market, 5 obtain proposals for, and enter into group or master health 6 insurance contracts on behalf of its members and their 7 employees and employee dependents so long as it meets all of 8 the following requirements: 9 (1) The HPG must be an organization having the 10 legal capacity to contract and having its legal situs in 11 Illinois. 12 (2) The principal persons responsible for the 13 conduct of the HPG must perform their HPG related 14 functions in Illinois. 15 (3) No HPG may collect premium in its name or hold 16 or manage premium or claim fund accounts unless duly 17 licensed and qualified as a managing general agent 18 pursuant to Section 141a of the Illinois Insurance Code 19 or a third party administrator pursuant to Section 20 511.105 of the Illinois Insurance Code. 21 (4) If the HPG gives an offer, application, notice, 22 or proposal of insurance to an employer, it must disclose 23 to that employer the total cost of the insurance. Dues, 24 fees, or charges to be paid to the HPG, HPG sponsor, or 25 any other entity as a condition to purchasing the 26 insurance must be itemized. The HPG shall also disclose 27 to its members the amount of any dividends, experience 28 refunds, or other such payments it receives from the 29 risk-bearer. 30 (5) An HPG must register with the Director before 31 entering into a group or master health insurance contract 32 on behalf of its members and must renew the registration 33 annually on forms and at times prescribed by the Director 34 in rules specifying, at minimum, (i) the identity of the SB579 Engrossed -32- LRB9101022JSpc 1 officers and directors, trustees, or attorney-in-fact of 2 the HPG; (ii) a certification that those persons have not 3 been convicted of any felony offense involving a breach 4 of fiduciary duty or improper manipulation of accounts; 5 and (iii) the number of employer members then enrolled in 6 the HPG, together with any other information that may be 7 needed to carry out the purposes of this Act. 8 (6) At the time of initial registration and each 9 renewal thereof an HPG shall pay a fee of $100 to the 10 Director. 11 (d) If an HPG is formed by an HPG sponsor or risk-bearer 12 and the HPG performs no marketing, negotiation, solicitation, 13 or proposing of insurance to HPG members, exclusive of 14 ministerial acts performed by individual employers to service 15 their own employees, then a group or master health insurance 16 contract may be issued in the name of the HPG and held by an 17 HPG sponsor, risk-bearer, or designated employer member 18 within the State. In these cases the HPG requirements 19 specified in subsection (c) shall not be applicable, however: 20 (1) the group or master health insurance contract 21 must contain a provision permitting the contract to be 22 enforced through legal action initiated by any employer 23 member or by an employee of an HPG member who has paid 24 premium for the coverage provided; 25 (2) the group or master health insurance contract 26 must be available for inspection and copying by any HPG 27 member, employee, or insured dependent at a designated 28 location within the State at all normal business hours; 29 and 30 (3) any information concerning HPG membership 31 required by rule under item (5) of subsection (c) must be 32 provided by the HPG sponsor in its registration and 33 renewal forms or by the risk-bearer in its annual 34 reports. SB579 Engrossed -33- LRB9101022JSpc 1 (Source: P.A. 90-337, eff. 1-1-98; 90-655, eff. 7-30-98.) 2 (215 ILCS 123/20) 3 Sec. 20. HPG sponsors. Except as provided by Sections 15 4 and 25 of this Act, only a corporation authorized by the 5 Secretary of State to transact business in Illinois may 6 sponsor one or more HPGs with no more than 100,00010,0007 covered individuals by negotiating, soliciting, or servicing 8 health insurance contracts for HPGs and their members. Such a 9 corporation may assert and maintain authority to act as an 10 HPG sponsor by complying with all of the following 11 requirements: 12 (1) The principal officers and directors 13 responsible for the conduct of the HPG sponsor must 14 perform their HPG sponsor related functions in Illinois. 15 (2) No insurance risk may be borne or retained by 16 the HPG sponsor; all health insurance contracts issued to 17 HPGs through the HPG sponsor must be delivered in 18 Illinois. 19 (3) No HPG sponsor may collect premium in its name 20 or hold or manage premium or claim fund accounts unless 21 duly qualified and licensed as a managing general agent 22 pursuant to Section 141a of the Illinois Insurance Code 23 or as a third party administrator pursuant to Section 24 511.105 of the Illinois Insurance Code. 25 (4) If the HPG gives an offer, application, notice, 26 or proposal of insurance to an employer, it must disclose 27 the total cost of the insurance. Dues, fees, or charges 28 to be paid to the HPG, HPG sponsor, or any other entity 29 as a condition to purchasing the insurance must be 30 itemized. The HPG shall also disclose to its members the 31 amount of any dividends, experience refunds, or other 32 such payments it receives from the risk-bearer. 33 (5) An HPG sponsor must register with the Director SB579 Engrossed -34- LRB9101022JSpc 1 before negotiating or soliciting any group or master 2 health insurance contract for any HPG and must renew the 3 registration annually on forms and at times prescribed by 4 the Director in rules specifying, at minimum, (i) the 5 identity of the officers and directors of the HPG sponsor 6 corporation; (ii) a certification that those persons have 7 not been convicted of any felony offense involving a 8 breach of fiduciary duty or improper manipulation of 9 accounts; (iii) the number of employer members then 10 enrolled in each HPG sponsored; (iv) the date on which 11 each HPG was issued a group or master health insurance 12 contract, if any; and (v) the date on which each such 13 contract, if any, was terminated. 14 (6) At the time of initial registration and each 15 renewal thereof an HPG sponsor shall pay a fee of $100 to 16 the Director. 17 (Source: P.A. 90-337, eff. 1-1-98.) 18 Section 235. The Health Maintenance Organization Act is 19 amended by changing Sections 2-2 and 6-7 and adding Section 20 5-3.6 as follows: 21 (215 ILCS 125/2-2) (from Ch. 111 1/2, par. 1404) 22 Sec. 2-2. Determination by Director; Health Maintenance 23 Advisory Board. 24 (a) Upon receipt of an application for issuance of a 25 certificate of authority, the Director shall transmit copies 26 of such application and accompanying documents to the 27 Director of the Illinois Department of Public Health. The 28 Director of the Department of Public Health shall then 29 determine whether the applicant for certificate of authority, 30 with respect to health care services to be furnished: (1) has 31 demonstrated the willingness and potential ability to assure 32 that such health care service will be provided in a manner to SB579 Engrossed -35- LRB9101022JSpc 1 insure both availability and accessibility of adequate 2 personnel and facilities and in a manner enhancing 3 availability, accessibility, and continuity of service; and 4 (2) has arrangements, established in accordance with 5 regulations promulgated by the Department of Public Health 6 for an ongoing quality of health care assurance program 7 concerning health care processes and outcomes. Upon 8 investigation, the Director of the Department of Public 9 Health shall certify to the Director whether the proposed 10 Health Maintenance Organization meets the requirements of 11 this subsection (a). If the Director of the Department of 12 Public Health certifies that the Health Maintenance 13 Organization does not meet such requirements, he shall 14 specify in what respect it is deficient. 15 There is created in the Department of Public Health a 16 Health Maintenance Advisory Board composed of 11 members. 17 Nine9members shallwhohave practiced in the health field, 18 4 of which shall have been or are currently affiliated with a 19 Health Maintenance Organization. Two of the members shall be 20 members of the general public, one of whom is over 50 years 21 of age. Each member shall be appointed by the Director of 22 the Department of Public Health and serve at the pleasure of 23 that Director and shall receive no compensation for services 24 rendered other than reimbursement for expenses. SixFive25 members of the Board shall constitute a quorum. A vacancy in 26 the membership of the Advisory Board shall not impair the 27 right of a quorum to exercise all rights and perform all 28 duties of the Board. The Health Maintenance Advisory Board 29 has the power to review and comment on proposed rules and 30 regulations to be promulgated by the Director of the 31 Department of Public Health within 30 days after those 32 proposed rules and regulations have been submitted to the 33 Advisory Board. 34 (b) Issuance of a certificate of authority shall be SB579 Engrossed -36- LRB9101022JSpc 1 granted if the following conditions are met: 2 (1) the requirements of subsection (c) of Section 3 2-1 have been fulfilled; 4 (2) the persons responsible for the conduct of the 5 affairs of the applicant are competent, trustworthy, and 6 possess good reputations, and have had appropriate 7 experience, training or education; 8 (3) the Director of the Department of Public Health 9 certifies that the Health Maintenance Organization's 10 proposed plan of operation meets the requirements of this 11 Act; 12 (4) the Health Care Plan furnishes basic health 13 care services on a prepaid basis, through insurance or 14 otherwise, except to the extent of reasonable 15 requirements for co-payments or deductibles as authorized 16 by this Act; 17 (5) the Health Maintenance Organization is 18 financially responsible and may reasonably be expected to 19 meet its obligations to enrollees and prospective 20 enrollees; in making this determination, the Director 21 shall consider: 22 (A) the financial soundness of the applicant's 23 arrangements for health services and the minimum 24 standard rates, co-payments and other patient 25 charges used in connection therewith; 26 (B) the adequacy of working capital, other 27 sources of funding, and provisions for 28 contingencies; and 29 (C) that no certificate of authority shall be 30 issued if the initial minimum net worth of the 31 applicant is less than $2,000,000. The initial net 32 worth shall be provided in cash and securities in 33 combination and form acceptable to the Director; 34 (6) the agreements with providers for the provision SB579 Engrossed -37- LRB9101022JSpc 1 of health services contain the provisions required by 2 Section 2-8 of this Act; and 3 (7) any deficiencies identified by the Director 4 have been corrected. 5 (Source: P.A. 86-620; 86-1475.) 6 (215 ILCS 125/5-3.6 new) 7 Sec. 5-3.6. Managed Care Patient Rights Act. Health 8 maintenance organizations are subject to the provisions of 9 the Managed Care Patient Rights Act. 10 (215 ILCS 125/6-7) (from Ch. 111 1/2, par. 1418.7) 11 Sec. 6-7. Board of Directors. The board of directors of 12 the Association consists of not less than 75nor more than 13 119members serving terms as established in the plan of 14 operation. The members of the board are to be selected by 15 member organizations subject to the approval of the Director, 16 except the Director shall name 2 members who are current 17 enrollees, one of whom is over 50 years of age. Vacancies on 18 the board must be filled for the remaining period of the term 19 in the manner described in the plan of operation. To select 20 the initial board of directors, and initially organize the 21 Association, the Director must give notice to all member 22 organizations of the time and place of the organizational 23 meeting. In determining voting rights at the organizational 24 meeting each member organization is entitled to one vote in 25 person or by proxy. If the board of directors is not 26 selected at the organizational meeting, the Director may 27 appoint the initial members. 28 In approving selections or in appointing members to the 29 board, the Director must consider, whether all member 30 organizations are fairly represented. 31 Members of the board may be reimbursed from the assets of 32 the Association for expenses incurred by them as members of SB579 Engrossed -38- LRB9101022JSpc 1 the board of directors but members of the board may not 2 otherwise be compensated by the Association for their 3 services. 4 (Source: P.A. 85-20.) 5 Section 240. The Limited Health Service Organization Act 6 is amended by adding Section 4002.6 as follows: 7 (215 ILCS 130/4002.6 new) 8 Sec. 4002.6. Managed Care Patient Rights Act. Except 9 for health care plans offering only dental services or only 10 vision services, limited health service organizations are 11 subject to the provisions of the Managed Care Patient Rights 12 Act. 13 Section 245. The Voluntary Health Services Plans Act is 14 amended by adding Section 15.30 as follows: 15 (215 ILCS 165/15.30 new) 16 Sec. 15.30. Managed Care Patient Rights Act. A health 17 service plan corporation is subject to the provisions of the 18 Managed Care Patient Rights Act. 19 Section 250. The Illinois Public Aid Code is amended by 20 adding Section 5-16.12 as follows: 21 (305 ILCS 5/5-16.12 new) 22 Sec. 5-16.12. Managed Care Patient Rights Act. The 23 medical assistance program and other programs administered by 24 the Department are subject to the provisions of the Managed 25 Care Patient Rights Act. The Department may adopt rules to 26 implement those provisions. These rules shall require 27 compliance with that Act in the medical assistance managed 28 care programs and other programs administered by the SB579 Engrossed -39- LRB9101022JSpc 1 Department. The medical assistance fee-for-service program 2 is not subject to the provisions of the Managed Care Patient 3 Rights Act. 4 Section 299. Effective date. This Act takes effect 5 January 1, 2000, except that Section 85 takes effect July 1, 6 2000. SB579 Engrossed -40- LRB9101022JSpc 1 INDEX 2 Statutes amended in order of appearance 3 5 ILCS 375/6.12 new 4 30 ILCS 805/8.23 new 5 55 ILCS 5/5-1069.8 new 6 65 ILCS 5/10-4-2.8 new 7 215 ILCS 5/155.36 new 8 215 ILCS 5/370g from Ch. 73, par. 982g 9 215 ILCS 5/370s new 10 215 ILCS 5/511.118 new 11 215 ILCS 105/8.6 new 12 215 ILCS 123/15 13 215 ILCS 123/20 14 215 ILCS 125/2-2 from Ch. 111 1/2, par. 1404 15 215 ILCS 125/5-3.6 new 16 215 ILCS 125/6-7 from Ch. 111 1/2, par. 1418.7 17 215 ILCS 130/4002.6 new 18 215 ILCS 165/15.30 new 19 305 ILCS 5/5-16.12 new