093_HB3580
LRB093 02404 JLS 02412 b
1 AN ACT concerning small employer health 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 25 as follows:
6 (215 ILCS 93/25)
7 Sec. 25. Premium Rates. (a) Premium rates for health
8 benefit plans subject to this Act shall be established on the
9 basis of community-based rates and not on the basis of
10 experience-based rates. The Department shall issue rules
11 necessary to implement this Section. subject to all of the
12 following provisions:
13 (1) The index rate for a rating period for any
14 class of business shall not exceed the index rate for any
15 other class of business by more than 20%.
16 (2) For a class of business, the premium rates
17 charged during a rating period to small employers with
18 similar case characteristics for the same or similar
19 coverage, or the rates that could be charged to such
20 employers under the rating system for that class of
21 business, shall not vary from the index rate by more than
22 25% of the index rate.
23 (3) The percentage increase in the premium rate
24 charged to a small employer for a new rating period shall
25 not exceed the sum of the following:
26 (A) the percentage change in the new business
27 premium rate measured from the first day of the
28 prior rating period to the first day of the new
29 rating period. In the case of a health benefit plan
30 into which the small employer carrier is no longer
31 enrolling new small employers, the small employer
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1 carrier shall use the percentage change in the base
2 premium rate;
3 (B) an adjustment, not to exceed 15% annually
4 and adjusted pro rata for rating periods of less
5 than one year, due to claim experience, health
6 status, or duration of coverage of the employees or
7 dependents of the small employer as determined from
8 the small employer carrier's rate manual for the
9 class of business; and
10 (C) any adjustment due to change in coverage
11 or change in the case characteristics of the small
12 employer as determined from the small employer
13 carrier's rate manual for the class of business.
14 (4) Adjustments in rates for a new rating period
15 due to claim experience, health status and duration of
16 coverage shall not be charged to individual employees or
17 dependents. Any such adjustment shall be applied
18 uniformly to the rates charged for all employees and
19 dependents of the small employer.
20 (5) In the case of health benefit plans delivered
21 or issued for delivery prior to the effective date of
22 this Act, a premium rate for a rating period may exceed
23 the ranges set forth in items (1) and (2) of subsection
24 (a) for a period of 3 years following the effective date
25 of this Act. In such case, the percentage increase in
26 the premium rate charged to a small employer for a new
27 rating period shall not exceed the sum of the following:
28 (A) the percentage change in the new business
29 premium rate measured from the first day of the
30 prior rating period to the first day of the new
31 rating period; in the case of a class of business
32 into which the small employer carrier is no longer
33 enrolling new small employes, the small employer
34 carrier shall use the percentage change in the base
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1 premium rate, provided that such change does not
2 exceed, on a percentage basis, the change in the new
3 business premium rate for the most similar class of
4 business into which the small employer carrier is
5 actively enrolling new small employers; and
6 (B) any adjustment due to change in coverage
7 or change in the case characteristics of the small
8 employer as determined from the carrier's rate
9 manual for the class of business.
10 (6) Small employer carriers shall apply rating
11 factors, including case characteristics, consistently
12 with respect to all small employers in a class of
13 business. A small employer carrier shall treat all health
14 benefit plans issued or renewed in the same calendar
15 month as having the same rating period.
16 (7) For the purposes of this subsection, a health
17 benefit plan that contains a restricted network provision
18 shall not be considered similar coverage to a health
19 benefit plan that does not contain such a provision,
20 provided that the restriction of benefits to network
21 providers results in substantial differences in claim
22 costs.
23 (b) A small employer carrier shall not transfer a small
24 employer involuntarily into or out of a class of business. A
25 small employer carrier shall not offer to transfer a small
26 employer into or out of a class of business unless such offer
27 is made to transfer all small employers in the class of
28 business without regard to case characteristics, claim
29 experience, health status or duration of coverage since
30 issue.
31 (Source: P.A. 91-510, eff. 1-1-00.)