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Public Act 103-0747 | ||||
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AN ACT concerning regulation. | ||||
Be it enacted by the People of the State of Illinois, | ||||
represented in the General Assembly: | ||||
Section 5. The Illinois Insurance Code is amended by | ||||
changing Section 363 as follows: | ||||
(215 ILCS 5/363) (from Ch. 73, par. 975) | ||||
Sec. 363. Medicare supplement policies; minimum standards. | ||||
(1) Except as otherwise specifically provided therein, | ||||
this Section and Section 363a of this Code shall apply to: | ||||
(a) all Medicare supplement policies and subscriber | ||||
contracts delivered or issued for delivery in this State | ||||
on and after January 1, 1989; and | ||||
(b) all certificates issued under group Medicare | ||||
supplement policies or subscriber contracts, which | ||||
certificates are issued or issued for delivery in this | ||||
State on and after January 1, 1989. | ||||
This Section shall not apply to "Accident Only" or | ||||
"Specified Disease" types of policies. The provisions of this | ||||
Section are not intended to prohibit or apply to policies or | ||||
health care benefit plans, including group conversion | ||||
policies, provided to Medicare eligible persons, which | ||||
policies or plans are not marketed or purported or held to be | ||||
Medicare supplement policies or benefit plans. |
(2) For the purposes of this Section and Section 363a, the | ||
following terms have the following meanings: | ||
(a) "Applicant" means: | ||
(i) in the case of individual Medicare supplement | ||
policy, the person who seeks to contract for insurance | ||
benefits, and | ||
(ii) in the case of a group Medicare policy or | ||
subscriber contract, the proposed certificate holder. | ||
(b) "Certificate" means any certificate delivered or | ||
issued for delivery in this State under a group Medicare | ||
supplement policy. | ||
(c) "Medicare supplement policy" means an individual | ||
policy of accident and health insurance, as defined in | ||
paragraph (a) of subsection (2) of Section 355a of this | ||
Code, or a group policy or certificate delivered or issued | ||
for delivery in this State by an insurer, fraternal | ||
benefit society, voluntary health service plan, or health | ||
maintenance organization, other than a policy issued | ||
pursuant to a contract under Section 1876 of the federal | ||
Social Security Act (42 U.S.C. Section 1395 et seq.) or a | ||
policy issued under a demonstration project specified in | ||
42 U.S.C. Section 1395ss(g)(1), or any similar | ||
organization, that is advertised, marketed, or designed | ||
primarily as a supplement to reimbursements under Medicare | ||
for the hospital, medical, or surgical expenses of persons | ||
eligible for Medicare. |
(d) "Issuer" includes insurance companies, fraternal | ||
benefit societies, voluntary health service plans, health | ||
maintenance organizations, or any other entity providing | ||
Medicare supplement insurance, unless the context clearly | ||
indicates otherwise. | ||
(e) "Medicare" means the Health Insurance for the Aged | ||
Act, Title XVIII of the Social Security Amendments of | ||
1965. | ||
(3) No Medicare supplement insurance policy, contract, or | ||
certificate, that provides benefits that duplicate benefits | ||
provided by Medicare, shall be issued or issued for delivery | ||
in this State after December 31, 1988. No such policy, | ||
contract, or certificate shall provide lesser benefits than | ||
those required under this Section or the existing Medicare | ||
Supplement Minimum Standards Regulation, except where | ||
duplication of Medicare benefits would result. | ||
(4) Medicare supplement policies or certificates shall | ||
have a notice prominently printed on the first page of the | ||
policy or attached thereto stating in substance that the | ||
policyholder or certificate holder shall have the right to | ||
return the policy or certificate within 30 days of its | ||
delivery and to have the premium refunded directly to him or | ||
her in a timely manner if, after examination of the policy or | ||
certificate, the insured person is not satisfied for any | ||
reason. | ||
(5) A Medicare supplement policy or certificate may not |
deny a claim for losses incurred more than 6 months from the | ||
effective date of coverage for a preexisting condition. The | ||
policy may not define a preexisting condition more | ||
restrictively than a condition for which medical advice was | ||
given or treatment was recommended by or received from a | ||
physician within 6 months before the effective date of | ||
coverage. | ||
(6) An issuer of a Medicare supplement policy shall: | ||
(a) not deny coverage to an applicant under 65 years | ||
of age who meets any of the following criteria: | ||
(i) becomes eligible for Medicare by reason of | ||
disability if the person makes application for a | ||
Medicare supplement policy within 6 months of the | ||
first day on which the person enrolls for benefits | ||
under Medicare Part B; for a person who is | ||
retroactively enrolled in Medicare Part B due to a | ||
retroactive eligibility decision made by the Social | ||
Security Administration, the application must be | ||
submitted within a 6-month period beginning with the | ||
month in which the person received notice of | ||
retroactive eligibility to enroll; | ||
(ii) has Medicare and an employer group health | ||
plan (either primary or secondary to Medicare) that | ||
terminates or ceases to provide all such supplemental | ||
health benefits; | ||
(iii) is insured by a Medicare Advantage plan that |
includes a Health Maintenance Organization, a | ||
Preferred Provider Organization, and a Private | ||
Fee-For-Service or Medicare Select plan and the | ||
applicant moves out of the plan's service area; the | ||
insurer goes out of business, withdraws from the | ||
market, or has its Medicare contract terminated; or | ||
the plan violates its contract provisions or is | ||
misrepresented in its marketing; or | ||
(iv) is insured by a Medicare supplement policy | ||
and the insurer goes out of business, withdraws from | ||
the market, or the insurance company or agents | ||
misrepresent the plan and the applicant is without | ||
coverage; | ||
(b) make available to persons eligible for Medicare by | ||
reason of disability each type of Medicare supplement | ||
policy the issuer makes available to persons eligible for | ||
Medicare by reason of age; | ||
(c) not charge individuals who become eligible for | ||
Medicare by reason of disability and who are under the age | ||
of 65 premium rates for any medical supplemental insurance | ||
benefit plan offered by the issuer that exceed the | ||
issuer's highest rate on the current rate schedule filed | ||
with the Division of Insurance for that plan to | ||
individuals who are age 65 or older; and | ||
(d) provide the rights granted by items (a) through | ||
(d), for 6 months after the effective date of this |
amendatory Act of the 95th General Assembly, to any person | ||
who had enrolled for benefits under Medicare Part B prior | ||
to this amendatory Act of the 95th General Assembly who | ||
otherwise would have been eligible for coverage under item | ||
(a). | ||
(7) The Director shall issue reasonable rules and | ||
regulations for the following purposes: | ||
(a) To establish specific standards for policy | ||
provisions of Medicare policies and certificates. The | ||
standards shall be in accordance with the requirements of | ||
this Code. No requirement of this Code relating to minimum | ||
required policy benefits, other than the minimum standards | ||
contained in this Section and Section 363a, shall apply to | ||
Medicare supplement policies and certificates. The | ||
standards may cover, but are not limited to the following: | ||
(A) Terms of renewability. | ||
(B) Initial and subsequent terms of eligibility. | ||
(C) Non-duplication of coverage. | ||
(D) Probationary and elimination periods. | ||
(E) Benefit limitations, exceptions and | ||
reductions. | ||
(F) Requirements for replacement. | ||
(G) Recurrent conditions. | ||
(H) Definition of terms. | ||
(I) Requirements for issuing rebates or credits to | ||
policyholders if the policy's loss ratio does not |
comply with subsection (7) of Section 363a. | ||
(J) Uniform methodology for the calculating and | ||
reporting of loss ratio information. | ||
(K) Assuring public access to loss ratio | ||
information of an issuer of Medicare supplement | ||
insurance. | ||
(L) Establishing a process for approving or | ||
disapproving proposed premium increases. | ||
(M) Establishing a policy for holding public | ||
hearings prior to approval of premium increases. | ||
(N) Establishing standards for Medicare Select | ||
policies. | ||
(O) Prohibited policy provisions not otherwise | ||
specifically authorized by statute that, in the | ||
opinion of the Director, are unjust, unfair, or | ||
unfairly discriminatory to any person insured or | ||
proposed for coverage under a medicare supplement | ||
policy or certificate. | ||
(b) To establish minimum standards for benefits and | ||
claims payments, marketing practices, compensation | ||
arrangements, and reporting practices for Medicare | ||
supplement policies. | ||
(c) To implement transitional requirements of Medicare | ||
supplement insurance benefits and premiums of Medicare | ||
supplement policies and certificates to conform to | ||
Medicare program revisions. |
(8) If an individual is at least 65 years of age but no | ||
more than 75 years of age and has an existing Medicare | ||
supplement policy, the individual is entitled to an annual | ||
open enrollment period lasting 45 days, commencing with the | ||
individual's birthday, and the individual may purchase any | ||
Medicare supplement policy with the same issuer or any | ||
affiliate authorized to transact business in this State that | ||
offers benefits equal to or lesser than those provided by the | ||
previous coverage. During this open enrollment period, an | ||
issuer of a Medicare supplement policy shall not deny or | ||
condition the issuance or effectiveness of Medicare | ||
supplemental coverage, nor discriminate in the pricing of | ||
coverage, because of health status, claims experience, receipt | ||
of health care, or a medical condition of the individual. An | ||
issuer shall provide notice of this annual open enrollment | ||
period for eligible Medicare supplement policyholders at the | ||
time that the application is made for a Medicare supplement | ||
policy or certificate. The notice shall be in a form that may | ||
be prescribed by the Department. | ||
(Source: P.A. 102-142, eff. 1-1-22 .) | ||
Section 99. Effective date. This Act takes effect January | ||
1, 2026. |