State of Illinois
92nd General Assembly
Legislation

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92_HB2003

 
                                               LRB9203349JSpc

 1        AN ACT concerning insurance.

 2        Be it enacted by the People of  the  State  of  Illinois,
 3    represented in the General Assembly:

 4        Section  5.  The  Small  Employer Health Insurance Rating
 5    Act is amended by changing Section 10 as follows:

 6        (215 ILCS 93/10)
 7        Sec. 10.  Definitions.  For purposes of this Act:
 8        "Actuarial certification" means a written statement by  a
 9    member   of  the  American  Academy  of  Actuaries  or  other
10    individual acceptable to the Director that a  small  employer
11    carrier is in compliance with the provisions of Section 25 of
12    this  Act,  based upon an examination which includes a review
13    of the appropriate records and of the  actuarial  assumptions
14    and  methods  utilized  by  the  small  employer  carrier  in
15    establishing  premium rates for the applicable health benefit
16    plans.
17        "Base premium rate" means for each class of  business  as
18    to  a rating period, the lowest premium rate charged or which
19    could be charged under a rating  system  for  that  class  of
20    business  by  the  small  employer carrier to small employers
21    with similar case characteristics for  health  benefit  plans
22    with the same or similar coverage.
23        "Carrier"   means   any   entity  which  provides  health
24    insurance in this State.   For  the  purposes  of  this  Act,
25    carrier  includes  a  licensed  insurance  company, a prepaid
26    hospital  or  medical  service  plan,  a  health  maintenance
27    organization,  or any other entity providing a plan of health
28    insurance or  health  benefits  subject  to  state  insurance
29    regulation.
30        "Case  characteristics"  means demographic, geographic or
31    other objective characteristics of a small employer, that are
 
                            -2-                LRB9203349JSpc
 1    considered  by   the   small   employer   carrier,   in   the
 2    determination of premium rates for the small employer.  Claim
 3    experience, health status, and duration of coverage shall not
 4    be  characteristics  for  the  purposes of the Small Employer
 5    Health Insurance Rating Act.
 6        "Class of business" means all or a separate  grouping  of
 7    small employers established pursuant to Section 20.
 8        "Director" means the Director of Insurance.
 9        "Department" means the Department of Insurance.
10        "Health  benefit  plan" or "plan" shall mean any hospital
11    or  medical  expense-incurred  policy,  hospital  or  medical
12    service plan contract,  or  health  maintenance  organization
13    subscriber  contract.   Health benefit plan shall not include
14    individual, accident-only, credit, dental,  vision,  medicare
15    supplement,  hospital  indemnity,  long  term  care, specific
16    disease, stop loss or disability income  insurance,  coverage
17    issued  as  a  supplement  to  liability  insurance, workers'
18    compensation or  similar  insurance,  or  automobile  medical
19    payment insurance.
20        "Index  rate"  means,  for each class of business as to a
21    rating  period  for  small  employers   with   similar   case
22    characteristics,  the  arithmetic mean of the applicable base
23    premium rate and the corresponding highest premium rate.
24        "Late enrollee" has the meaning given that  term  in  the
25    Illinois Health Insurance Portability and Accountability Act.
26        "New  business  premium  rate"  means,  for each class of
27    business as to a  rating  period,  the  lowest  premium  rate
28    charged  or  offered  or  which  could  have  been charged or
29    offered by the small employer carrier to small employers with
30    similar case characteristics for newly issued health  benefit
31    plans with the same or similar coverage.
32        "Objective    characteristics"    means   measurable   or
33    observable   phenomena.    An   example   of   a   measurable
34    characteristic would be the number of employees who were late
 
                            -3-                LRB9203349JSpc
 1    enrollees.  Examples of observable characteristics  would  be
 2    geographic   location  of  the  employer  or  gender  of  the
 3    employee.
 4        "Premium" means all monies paid by a small  employer  and
 5    eligible  employees as a condition of receiving coverage from
 6    a  small  employer  carrier,  including  any  fees  or  other
 7    contributions associated with the health benefit plan.
 8        "Rating period"  means  the  calendar  period  for  which
 9    premium  rates  established  by  a small employer carrier are
10    assumed to be in effect.
11        "Small employer" has the meaning given that term  in  the
12    Illinois Health Insurance Portability and Accountability Act,
13    except  that  an  employer  participating  in  a  health care
14    purchasing  group  in  accordance  with   the   Health   Care
15    Purchasing Group Act is not a small employer under this Act.
16        "Small  employer  carrier"  means  a  carrier that offers
17    health benefit plans covering employees of one or more  small
18    employers in this State.
19    (Source: P.A. 91-510, eff. 1-1-00.)

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