AUTHORITY: Implementing and authorized by the Health Maintenance Organization Act [215 ILCS 125].

SOURCE: Filed November 24, 1975; emergency amendment at 6 Ill. Reg. 10055, effective August 4, 1982, for a maximum of 150 days; amended at 6 Ill. Reg. 14846, effective November 23, 1982; codified at 8 Ill. Reg. 7273; Part repealed, new Part adopted at 12 Ill. Reg. 15583, effective October 1, 1988; amended at 14 Ill. Reg. 2403, effective February 15, 1990; amended at 34 Ill. Reg. 8104, effective June 2, 2010; Subchapter b recodified at 48 Ill. Reg. 17406.

SUBPART A: GENERAL PROVISIONS

 

Section 240.10  Authority, Scope and Purpose

 

a)         This Part is promulgated pursuant to the authority granted the Department of Public Health in Sections 2-2(a), 2-2(b) 5-4, 5-5(d) and 5-8 of the Health Maintenance Organization Act (Ill. Rev. Stat. 1987, ch. 111½, pars. 1404(a), 1404(b), 1412, 1413(d) and 1416) for the purpose of regulation and enhancement of Health Maintenance Organizations in Illinois. These regulations apply to certified Health Maintenance Organizations, as well as to applicants for an HMO Certificate of Authority, and are promulgated to carry out the Health Maintenance Organization Act and to facilitate the full and uniform implementation, enforcement and intent of the Act.

 

b)         Pursuant to the Act the Illinois Department of Public Health and the Illinois Department of Insurance have joint responsibility for the regulation of Health Maintenance Organizations (HMOs) in Illinois.  All applicants and certified programs are therefore bound by the Health Maintenance Organization rules of the Department of Insurance located at 50 Ill. Adm. Code 6101 as well as this Part. No person shall establish or operate a Health Maintenance Organization without obtaining a Certificate of Authority from the Department of Insurance.

 

c)         These regulations explain the requirements an HMO applicant must satisfy in order for the Department of Public Health to certify to the Department of Insurance that the applicant's proposed plan of operation meets the Department of Public Health requirements. Also included in this Part are the operational, recordkeeping and fee requirements applicable to HMOs.

 

Section 240.20  Definitions

 

            "Act" means the Health Maintenance Organization Act (Ill. Rev. Stat. 1987, ch. 111½, pars. 1401 et seq.).

 

            "Basic health care services" means emergency care, and inpatient hospital and physician care, outpatient medical services, mental health services and care for alcohol and drug abuse, including any reasonable deductibles and co-payments. (See also the Department of Insurance regulations located at 50 Ill. Adm. Code 6101.130.) (Section 1-2 of the Act)

 

            "Director of Department of Public Health" means the Director of the Illinois Department of Public Health, or such person or office as designated by the Director of the Department of Public Health to act in the Director's behalf.

 

            "Encounter" means a face to face contact between an enrollee and a basic health care service provider who has primary responsibility for assessing and treating the condition of the patient at a given contact and exercises independent judgement in the care of the enrollee.

 

            "Enrollee" or "member" means an individual who has been enrolled as a subscriber or as an eligible dependent of a subscriber and for whom the HMO has accepted the contractual responsibility for providing or arranging for at least, health care services and basic health care services.

 

            "Evidence of Coverage" means any certificate, agreement, or contract issued to an enrollee setting out the coverage to which he is entitled in exchange for a per capita prepaid sum. (Section 1-2 of the Act)

 

            "Grievance" means any written complaint by an enrollee regarding any aspect of the HMO relative to the enrollee. (See also the Department of Insurance regulations on HMO's, 50 Ill. Adm. Code 6101.40 for clarification.)

 

            "Health Care Plan" means any arrangement whereby any organization undertakes to provide, arrange for and pay for or reimburse the cost of basic health care services and at least part of such arrangement consists of arranging for or the provision of health care services, as distinguished from mere indemnification against the cost of such services, on a prepaid basis, through insurance or otherwise. (Section 1-2 of the Act)

 

            "Health Care Services" means any services included in the furnishing to any individual of medical or dental care, or the hospitalization or incident to the furnishing of such care or hospitalization as well as the furnishing to any person of any and all other services for the purpose of preventing, alleviating, curing or healing human illness or injury. (Section 1-2 of the Act)

 

            "Health Maintenance Organization" or "HMO" means any organization formed under the laws of this or another state to provide or arrange for one or more health care plans under a system which causes any part of the risk of health care delivery to be borne by the organization or its providers. (Section 1-2 of the Act)

 

            "Medical Director" means a physician licensed to practice medicine in all its branches in Illinois and who shall be responsible for final review when questions of medical practice arise in the HMO in order to assure the quality of health care services provided.

 

            "Peer Review" means the evaluation

 

            by similarly licensed practicing physicians of the effectiveness and efficiency of services ordered or performed by other similarly licensed practicing physicians, or

 

            by other professionals of the effectiveness and efficiency of services ordered or performed by other members of the profession whose work is being reviewed.

 

            "Plan Service Area" means the geographic territory to be served by the HMO.

 

            "Primary Care Physician" means a provider who has contracted with a Health Maintenance Organization to provide primary care services as defined by the contract and who is

 

            a physician licensed to practice medicine in all of its branches who spends a majority of clinical time engaged in general practice or in the practice of internal medicine, pediatrics, gynecology, obstetrics or family practice, or

 

            a chiropractic physician licensed to treat human ailments without the use of drugs or operative surgery.

 

            "Provider" means any physician, hospital facility, or other person which is licensed by state law or otherwise authorized by state, federal, or local law to furnish health care services. (Section 1-2 of the Act)

 

            "Quality Assessment Monitoring" means the planned, systematic, and routine collection of information by the HMO according to previously determined indicators of quality and appropriateness of patient care and clinical performance encompassing basic and supplemental health care services and providers. After periodic assessment and evaluation by the HMO, quality assessment monitoring can detect trends and identify opportunities for improving enrollees' care.

 

            "Supplemental Benefits" or "Selective Benefits" means any services or benefits provided by the HMO over and above those required as basic health care services.

 

            "Utilization Review" means the study of the appropriateness of the use of particular services and the appropriateness of the volume of services used.

 

(Source:  Amended at 14 Ill. Reg. 2403, effective February 15, 1990)

SUBPART B: APPLICATION FOR HMO CERTIFICATE OF AUTHORITY

 

Section 240.30  Submission of Application for HMO Certificate of Authority

 

The HMO application shall be submitted in triplicate (one original and two copies) to the Department of Insurance in a loose-leaf three-ring binder, indexed with the sections tabbed. The application requirements pertaining to information required by the Department of Public Health are described in Sections 240.40, 240.50, and 240.60 of this Part.

 

Section 240.40  Personnel, Organization and Provider Requirements

 

The application for an HMO Certificate of Authority shall contain the following information about the applicant's personnel, organization and providers:

 

a)         Organization charts which include descriptions of the administrative structure of the HMO and the HMO's relationship with the medical group, individual practice associations, or other provider arrangements, such as home health agencies, durable medical suppliers, nursing homes and laboratories.

 

b)         A flow of care chart or narrative which illustrates the movement and contacts of the enrollees through the primary and specialty care physicians of the HMO care system.

 

c)         A legible map or maps of the plan service areas by Zip Code to be served by the HMO showing the location of its offices and ambulatory health care facilities.

 

d)         A general description of any facilities to be used. An HMO that utilizes the services of physicians in their individual offices or contracts with groups of five or less participating physicians shall submit a map or maps of the locations of all such individual offices for such practitioners. All other HMOs shall submit a floor plan identifying the square footage available and a projection of the number of enrollees to be served in each ambulatory care facility.

 

e)         In addition to the Biographical Affidavit required by the Department of Insurance, the name, medical license number, resume and address of the medical director of the HMO.

 

f)         The name, resume and address of the chief administrative officer of the HMO.

 

g)         Job descriptions for the chief administrative officer and medical director positions.

 

h)         The name, medical license number and any Drug Enforcement Administration number issued to each physician with whom the HMO has agreements.

 

i)          Certification that each contract with providers requires the providers to assure that all nurses and other ancillary and paramedic personnel are licensed, certified or registered, as required to perform their duties.

 

j)          A list of each participating physician's name, medical license number, hospitals where the physician has admitting or staff privileges, each physician's specialty, and office address. The HMO shall provide evidence that the variety and composition of specialty participating plan physicians reflects the medical needs and characteristics of the enrollees in the plan service area. Such evidence may include historical data on the service needs experienced by the projected HMO population, survey data, or any other data concerning an assessment of the needs and characteristics of the projected HMO population.

 

k)         An explanation of how the HMO will make medically necessary services available twenty-four hours a day, seven days a week.

 

l)          The standards and procedures the HMO has developed for the selection of providers.

 

m)        Projections by the HMO for a two-year period that include projected enrollment levels, primary care physician to enrollee ratios, and plans for providing specialty care, laboratory, X-ray and hospital services. The HMO must provide evidence that the ratio and the projected ratios are consistent with its assessment and projection of enrollee needs and insure the availability and accessibility of health care services.

 

Section 240.50  Provision of Care Requirements

 

The application for an HMO Certificate of Authority shall contain the following information about the provision of health care services by the HMO:

 

a)         A copy of the evidence of coverage that will be issued to enrollees.

 

b)         A description of the HMO's referral system that will be used when an enrollee is in need of a health care service covered by the HMO plan, but not available through the participating plan physicians. The referral mechanism shall require that the provider make any appointments, hospitalization, surgical procedures and any other health services available to enrollees within a medically appropriate timeframe. This policy shall not be construed so as to relieve an enrollee of any financial obligation incurred when that enrollee fails or refuses to utilize the HMO referral system.

 

c)         A description of the medical record system of the HMO or HMO providers. The HMO and its providers shall meet the following medical record system requirements:

 

1)         Clinical records shall be maintained on each enrollee who receives health care services through the HMO. The medical records system shall be organized to facilitate retrieval and compilation of medical records information necessary to provide continuity of care among various member and nonmember providers who are directly involved in the care of the enrollee.

 

2)         There shall be a policy regarding the retention and retirement of enrollees' medical records.

 

3)         There shall be a policy regarding confidentiality, security and release of enrollees' medical records.

 

d)         Sample copies of all types of contracts entered into with providers. Copies of portions of actual contracts that pertain to the scope of services to be provided by the HMO shall be made available for review by the Department.

 

1)         The HMO's contracts shall contain the following:

 

A)        Descriptions of the arrangements for the provision of each of the types of services included in the evidence of coverage,

 

B)        Descriptions of how the providers will ensure that the HMO's enrollees will receive health care services at all times, and

 

C)        The provider's responsibilities within the HMO self-evaluation structure and activities described in Section 240.60 of this Part.

 

2)         Services which are to be provided by participating plan primary care physicians shall be covered by a written contract with the HMO.

 

3)         The HMO is not required to execute contracts for emergency and highly specialized services, such as pediatric cardiology, when the HMO provides the Department with documentation describing the mechanism for the provision of such services and the utilization review of such services. Emergency treatment shall include responses to emergency health problems as defined in the Department of Insurance Health Maintenance Organization rules located at 50 Ill. Adm. Code 6101.130 (d).

 

4)         If providers will be serving both HMO patients and fee-for-service clients, there shall be a statement in each HMO provider contract assuring no discrimination in the provision of health care services toward patients due to payment source.

 

e)         A description of the HMO's program of health education which shall relate to preventive health care and be oriented toward reducing health risks. This program can be provided by the HMO, or the HMO can choose to utilize health education programs currently being offered by entities other than the HMO.

 

f)         A plan for the implementation of an enrollee education program which shall relate to the use of the HMO system. Such a program shall describe the sources and types of care accessible and available within the HMO. The HMO shall include information on procedures for the coverage of emergency services both inside and out of the plan service area and within the terms of the enrollee certificate. When the scope of health care services available through the HMO changes, the enrollee education program shall be modified to communicate the changes in services available to enrollees.

 

g)         A description of how the HMO proposes to ensure the continued provision of health care services to enrollees in the event of the insolvency or unexpected closures of provider sites. Specific information shall be provided regarding hospitals and primary care provider sites.

 

Section 240.60  HMO Self-Evaluation Structure

 

a)         The application for an HMO Certificate of Authority shall contain a description of the actions that will be taken by the HMO to:

 

1)         Monitor, on an ongoing basis, the quality, availability and accessibility of care delivered under the auspices of the HMO, and

 

2)         Implement change, where necessary, based on problem identification, analysis and identification of corrective action.

 

b)         The application for an HMO Certificate of Authority shall contain a description of the quality assessment program adopted by the HMO, which shall meet the following requirements:

 

1)         The quality assessment program shall address both the medical and administrative aspects of the provision and delivery of health care services, such as availability, accessibility and continuity of care.

 

2)         The HMO shall have a written quality assessment plan that:

 

A)        Establishes goals, timeframes and objectives for the quality assessment program;

 

B)        Outlines the organizational structure that will be utilized in implementing the quality assessment monitoring activities and the recommendations that result from the quality assessment monitoring activities; and

 

C)        Describes the methodology and criteria that will be used to evaluate the health care services provided under the auspices of the HMO.

 

3)         Quality assessment monitoring activities shall include the following:

 

A)        Problems or concerns relative to the care rendered to enrollees shall be identified. Enrollees' accessibility to health care providers, appropriateness of utilization, and concerns identified by the HMO's medical or administrative staff and enrollees shall be considered.

 

B)        Problems or concerns identified by the quality assessment activities shall be evaluated in accordance with the written plan's methodology and criteria to determine whether problems or concerns do indeed exist, and what the causes of the problems or concerns are.

 

C)        An action plan shall be developed and implemented to correct the problems or concerns that have been verified. The action plan shall include an educational component for providers included in the action plan.

 

D)        Follow-up measures shall be implemented to evaluate the effectiveness of the action plan.

 

E)        The HMO shall have an ongoing process for monitoring the continued effectiveness of action plans in preventing problems from reoccurring, and in preventing problems from developing.

 

4)         The quality assessment program shall include physician participation, and all medical decisions shall be made by the medical director or the HMO's peer review body.

 

5)         Reports of quality assessment activities shall be made to the governing board of the HMO on a quarterly basis, at a minimum.

 

A)        Records and minutes shall be kept on meetings that pertain to quality assessment activities.

 

B)        Copies of reports of quality assessment activities shall be forwarded to the administrators of the HMO.

 

C)        The HMO shall make records and reports of quality assessment activities available for review by the Department, and the HMO shall submit the records to the Department upon request. In accordance with Sections 8-2101 and 8-2102 of the Code of Civil Procedure [735 ILCS 5], these records and reports shall be used solely for the purpose of evaluating and improving the quality of care rendered to enrollees through the HMO, and shall therefore not be admissible as evidence, nor discoverable in any action of any kind in any court or before any tribunal, board, agency or person. (Section 8-2102 of the Code of Civil Procedure)

 

c)         The application for an HMO Certificate of Authority shall contain a description of the medical record review program adopted by the HMO, which shall meet the following requirements:

 

1)         A written medical record review program shall:

 

A)        Establish minimum chart standards that shall be consistent with the medical record standards contained in this Part (see Section 240.90);

 

B)        Provide for a review and evaluation of the medical record documentation of primary care physicians pursuant to the HMO medical record review program, demonstrating that the HMO has assessed medical record practices; and

 

C)        Include a program of correction and education that will be implemented when deficiencies relative to chart documentation are found. Such a program shall include a means for the follow-up and correction of deficiencies.

 

2)         Reports of medical record review activities shall be made, at a minimum, on a quarterly basis.

 

A)        Records and minutes shall be kept on meetings that pertain to medical record review activities.

 

B)        Copies of reports of medical record review activities shall be forwarded to the administrators of the HMO.

 

C)        The HMO shall make records and reports of medical record review activities available for review by the Department, and the HMO shall submit the records to the Department upon request. In accordance with Sections 8-2101 and 8-2102 of the Code of Civil Procedure, these records and reports shall be used solely for the purpose of evaluating and improving the quality of care rendered to enrollees through the HMO, and shall therefore not be admissible as evidence, nor discoverable in any action of any kind in any court or before any tribunal, board, agency or person.  (Section 8-2102 of the Code of Civil Procedure)

 

3)         The HMO shall provide an outline of the organizational structure that will be used in implementing the medical record review activities and the recommendations that result from the medical record review activities.

 

d)         The application for an HMO Certificate of Authority shall contain a description of the utilization review program adopted by the HMO, which shall meet the following requirements:

 

1)         The utilization review program shall include procedures for the compilation of statistics that relate to health services information.

 

2)         The utilization review program shall review and evaluate health related statistical information, such as hospital admissions, ambulatory encounters, and the level of care utilized.

 

3)         The HMO shall outline the organizational structure that will be used in implementing the utilization review program activities and the recommendations that result from the utilization review activities.

 

4)         Reports of utilization review activities shall be made to the governing board of the HMO at a minimum, on a quarterly basis.

 

A)        Records and minutes shall be kept on meetings that pertain to utilization review activities.

 

B)        Copies of reports of utilization review activities shall be forwarded to the administrators of the HMO.

 

C)        The HMO shall make records and reports of utilization review activities available for review by the Department, and the HMO shall submit the records to the Department upon request. In accordance with Sections 8-2101 and 8-2102 of the Code of Civil Procedure, these records and reports shall be used solely for the purpose of evaluating and improving the quality of care rendered to enrollees through the HMO, and shall therefore not be admissible as evidence, nor discoverable in any action of any kind in any court or before any tribunal, board, agency or person.  (Section 8-2102 of the Code of Civil Procedure)

 

(Source:  Amended at 34 Ill. Reg. 8104, effective June 2, 2010)

SUBPART C: HMO OPERATING REQUIREMENTS

 

Section 240.80  General Operating Requirements

 

a)         The HMO operations shall be consistent with the information provided to the Department in the application.

 

b)         The HMO shall appoint a medical director prior to commencing operations. The medical director's credentials shall be submitted to the Department.

 

c)         The HMO shall develop and implement a process which will enable the HMO to maintain current information regarding each provider site under contract with the HMO, including the following:

 

1)         Attestation of the presence of valid certifications, registrations and licenses as required for physicians, nurses, and other ancillary and paramedic personnel who render care to enrollees at the provider site.

 

2)         The hours the provider site is open,

 

3)         The hours each physician is routinely available at the provider site,

 

4)         The extent to which twenty-four (24) hour a day, seven (7) day a week coverage is provided through the provider site,

 

5)         The number of HMO enrollees the provider site serves as well as the total number of patients served by the provider site.

 

d)         The HMO shall maintain a log that summarizes enrollee grievances and evidences HMO response to those grievances.

 

e)         The HMO's participating physicians, other than those whose scope of practice is limited to radiology, anesthesiology, pathology, or emergency medical services, shall have one of the following:

 

1)         admitting or staff privileges in at least one hospital within the plan service area, or

 

2)         documentation of an arrangement with a physician or physician group who has admitting or staff privileges within the plan service area to provide access to required hospital services. This documentation shall be maintained by the HMO.

 

f)         Within six (6) months of commencement of operation, the HMO shall establish operational medical records, quality assessment and utilization review programs as described in Section 240.60 of this Part.

 

g)         The HMO shall inform the Department of the procedure to be used in responding to an enrollee's need for an urgent appointment at a provider site.

 

h)         The HMO shall not cancel an enrollee's membership unless the HMO can present documentation verifying that:

 

1)         fraud or material misrepresentation in enrollment or in the use of services or facilities;

 

2)         material violation of the terms of the contract or evidence of coverage;

 

3)         termination of the group or individual contract under which the enrollee was covered, pursuant to the terms of the contract;

 

4)         failure of the enrollee and the primary care physician to establish a satisfactory patient-physician relationship if it is shown that:

 

i)          the HMO has, in good faith, provided the enrollee with the opportunity to select an alternative primary care physician; or

 

ii)         the enrollee has repeatedly refused to follow the plan of treatment ordered by the physician.

 

i)          In order to exercise the provisions of subsection (h) (4) of this Section, the HMO must notify the enrollee in writing at least 31 days in advance that the HMO considers the physician-patient relationship to be unsatisfactory and has outlined specific changes required to avoid termination.

 

j)          For purposes of subsection (h) of this Section, "material" means a fact or situation which is not merely technical in nature and results or could result in a substantive change in the situation. In addition, the definitions afforded this term by the courts of the State of Illinois shall apply when appropriate to the situation.

 

k)         For purposes of subsection (h) of this Section, "good faith" means honesty of purpose, freedom from intention to defraud and being faithful to one's duty or obligation. In addition, the definitions afforded this term by the courts of the State of Illinois shall apply when appropriate to the situation.

 

Section 240.90  HMO Provider Site Medical Record Requirements

 

a)         The HMO shall require each provider to maintain an active record for each enrollee who receives health care services. This record shall be kept current, complete, legible and available to the medical and administrative staff of the HMO and to the Department's representatives.

 

b)         The HMO shall require that each entry be indelibly added to the enrollee's record, dated and signed or initialed by the person making the entry. The HMO shall require each provider site to have a means of identifying the name and professional title of the individual who makes each entry.

 

c)         The medical record for each enrollee who has had a routine, scheduled appointment with one of the HMO's primary care physicians shall include the following information:

 

1)         identification,

 

2)         patient history,

 

3)         known past surgical procedures,

 

4)         known past and current diagnoses and problems, and

 

5)         known allergies and untoward reactions to drugs.

 

d)         The basic information collected pursuant to subsection (c) above shall be made available to each HMO provider with whom the enrollee has a scheduled encounter.

 

e)         The HMO provider site shall not be expected to have the basic information described in subsection (c) above for an enrollee whose only encounters with the HMO are unscheduled or of an emergency nature.

 

f)         The HMO shall require that the medical records for each enrollee who receives health care services contain the following information regarding each episode of care.

 

1)         reason for the encounter,

 

2)         evidence fo the provider's assessment of the enrollee's health problems,

 

3)         current diagnosis of the enrollee, including the results of any diagnostic tests,

 

4)         plan of treatment, including any therapies and health education, and

 

5)         if the basic information outlined in subsection (c) above is not available, any medical history relevant to the current episode of care.

 

g)         The HMO shall require each provider site to document that all outcomes of ancillary reports, such as laboratory tests and x-rays have been reviewed by the provider who ordered the reports. The HMO shall require each provider site to document that follow up actions have been taken regarding report results that are deemed significant by the provider who ordered the report.

 

Section 240.100  Required Information and Reports

 

a)         The HMO shall maintain a membership file that identifies the name, date of enrollment, date of birth, sex, and address for each enrollee.

 

b)         The following material changes to an Application for a Certificate of Authority shall be submitted to the Department:

 

1)         Changes in medical group, hospital, skilled nursing home or other medically related agreements which may affect the availability and accessibility of health care services to enrollees shall be communicated in writing to the Department no later than thirty days after the execution of such changes or termination of such agreements.

 

2)         Personnel changes in the Chief Administrative Officer or Medical Director positions shall be reported to the Department in writing upon the termination and commencement of such employment. A resume for the new appointees shall accompany each notice of appointment.

 

3)         Termination of any benefit or service by the HMO shall be reported to the Department within 48 hours by telephone and confirmed in writing within five working days.

 

4)         Changes in the HMO's medical record, quality assessment and utilization review plans shall be submitted no later than thirty days after the adoption of the new plan.

 

5)         Changes in the contracts concerning the information required in Section 240.50 (d) of this Part shall be filed with the Department at least thirty (30) days prior to entering into the revised Contracts.

 

c)         The HMO shall report to the Department semi-annually on or before the first day of September and the first day of March the results of the self evaluation activities regarding medical record review, quality assessment monitoring and utilization review. In accordance with Sections 8-2101 and 8-2102 of the Code of Civil Procedure (Ill. Rev. Stat. 1985, ch. 110, pars. 8-2101 and 8-2102), these records and reports shall be used solely for the purpose of evaluating and improving the quality of care rendered to enrollees through the HMO, and shall therefore not be admissible as evidence, nor discoverable in any action of any kind in any court or before any tribunal, board, agency or person.

 

d)         The HMO shall protect the confidentiality of its members from public disclosure of confidential medical information; however, the Department shall not be precluded from completing medical record reviews or obtaining information as allowed in this Part and the Act. The HMO and all contracted providers shall make available to the Department books, records and information regarding the provision of health care services to enrollees. In accordance with Sections 8-2101 and 8-2102 of the Code of Civil Procedure (Ill. Rev. Stat. 1985, ch. 110, pars. 8-2101 and 8-2102), these books, records and information shall be used solely for the purpose of evaluating and improving the quality of care rendered to enrollees through the HMO, and shall not be admissible as evidence, nor discoverable in any action of any kind in any court or before any tribunal, board, agency or person.

 

Section 240.110  Department Interventions

 

a)         The Department of Public Health shall make an examination concerning the quality of health care services of any health maintenance organization and providers with whom such organization has contracts, agreements, or other arrangements, pursuant to its health care plan as often as he deems it necessary for the protection of the interest of the people of this state, but not less frequently than once every three years (Section 5-4 of the Act). In determining whether an examination is necessary, the Department shall consider whether health care services are being made available and accessible as evidenced by the following factors:

 

1)         The number and nature of grievances received by the HMO,

 

2)         The number of enrollees in the plan service area relative to the number participating health care providers in the plan service area,

 

3)         The distribution of the enrollees and the providers throughout the plan service area,

 

4)         The hours providers are available, and

 

5)         The method by which after hours service is provided.

 

b)         Upon completion of the Department's inspection of an HMO provider site, the Department shall furnish verbal notification to the provider site of areas of provider site operations and records found during the inspection which fail to comply with this Part. HMO representatives may also be present at this conference.

 

c)         Upon completion of the Department's inspection of an HMO or HMO provider, the Department shall furnish to the HMO written notification of findings of noncompliance with this Part.

 

d)         The HMO shall respond to the Department's inspection findings of noncompliance within ten working days of receipt of the findings. The HMO's response shall indicate the actions to be taken by the HMO in order to remedy the noncompliance noted by the Department. When the HMO's response does not remedy the noncompliance, the Department shall notify the HMO in writing of why the response is unsatisfactory.

 

e)         When the Department determines that the HMO has failed to secure a provider's compliance with this Part, the Department may recommend to the Department of Insurance that the HMO be prohibited from adding more enrollees who would be provided health care services at the noncompliant site. Such a recommendation shall be made only when the noncompliance adversely affects the enrollees' availability and accessibility to health care services described in the evidence of coverage, and the HMO has demonstrated repeated inability to correct the deficiencies.

 

f)         When the Department determines that an HMO does not meet the minimum standards contained in this Part, and has repeatedly failed to remedy the noncompliance, then the Department shall certify the following to the Director of The Department of Insurance:

 

1)         That the Health Maintenance Organization does not meet the requirements of the act and this part, or

 

2)         That the Health Maintenance Organization is unable to fulfill its obligations to furnish health care services as required under its health care plan. Such certification shall inform the Department of Insurance that administrative review is warranted to consider suspension or revocation of the HMO's Certificate of Authority pursuant to Section 5-5 of the Act. (Ill. Rev. Stat. 1987, ch. 111½ , par. 1413)

 

Section 240.120  Fees

 

a)         The expenses of examining Health Maintenance Organizations shall be assessed against the organization being examined. (Section 5-4 of the Act)

 

b)         The annual fee for each health maintenance organization, which is based on the Department's estimate of cost for staff and other Department expenses to provide the examinations, shall be as follows:

 

1)         A fixed annual fee of $1200, plus

 

2)         An additional fee based on the individual HMO's enrollment in Illinois as follows:

 

A)        For the first 50,000 enrollees, the HMO shall pay $.03 per enrollee,

 

B)        For additional enrollees between 50,000 and 100,000, the HMO shall pay $.02 per enrollee, and

 

C)        The HMO shall pay $.01 for each enrollee in excess of 100,000.

 

c)         In computing the amount of the additional fee, the HMO shall use data from its most recent financial report filed with the Illinois Department of Insurance on or before March 1 of the year as based on enrollment as of December 31 of the previous year.

 

d)         The HMO shall pay the fees, which will be billed by the Department, no later than June 30 of the year in which the fees are billed.