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1 | AN ACT in relation to insurance.
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2 | Be it enacted by the People of the State of Illinois, | ||||||
3 | represented in the General Assembly:
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4 | Section 5. The Illinois Insurance Code is amended by | ||||||
5 | changing Section
351B-5 and adding Section 367.4 as follows:
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6 | (215 ILCS 5/351B-5) (from Ch. 73, par. 963B-5)
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7 | Sec. 351B-5. Applicability of other Code provisions. All | ||||||
8 | policies of
accident and health insurance issued
under this | ||||||
9 | Article shall be subject to the provisions of Sections 356c,
| ||||||
10 | subsection (a) of Section 356g, 356h, 356n, 367.4, 367c, 367d, | ||||||
11 | 370, 370a,
and 370e of this Code.
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12 | (Source: P.A. 86-1407; 87-792; 87-1066.)
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13 | (215 ILCS 5/367.4 new)
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14 | Sec. 367.4. Reporting of claims information to group health | ||||||
15 | plan sponsor.
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16 | (a) In this Section, "group health plan", "health insurance | ||||||
17 | coverage",
"health insurance issuer", and "plan sponsor" have | ||||||
18 | the meanings ascribed to
those terms in the Illinois Health | ||||||
19 | Insurance Portability and Accountability
Act.
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20 | "Summary health information" means information that may be
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21 | individually identifiable health information and
(i) that | ||||||
22 | summarizes the claims history, claims expenses, or type of
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23 | claims experienced by individuals for whom a plan sponsor has | ||||||
24 | provided
health benefits under a group health plan and
(ii) | ||||||
25 | from which the information identifying an individual, a | ||||||
26 | relative or employer of the individual, or a member of the | ||||||
27 | individual's household
has been deleted, except that | ||||||
28 | information describing geographic subdivisions of a State need | ||||||
29 | only be aggregated to the level of a 5-digit zip code.
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30 | (b) A group health plan, or a health insurance issuer or | ||||||
31 | health maintenance organization with
respect to a group health |
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1 | plan, shall disclose summary health
information to the plan | ||||||
2 | sponsor if the plan sponsor requests the
summary health | ||||||
3 | information for the purpose of (i) obtaining premium bids from | ||||||
4 | health plans for providing health
insurance coverage under the | ||||||
5 | group health plan or (ii) modifying, amending, or terminating | ||||||
6 | the group health plan. | ||||||
7 | The plan documents of the group health plan must be amended | ||||||
8 | to
incorporate provisions to do the following: | ||||||
9 | (1) Establish the permitted and required uses and | ||||||
10 | disclosures of
such information by the plan sponsor. | ||||||
11 | (2) Provide that the plan sponsor agrees to not use or | ||||||
12 | further disclose the information other than as
permitted or | ||||||
13 | required by the plan documents or as required by law.
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14 | (3) Provide that the plan sponsor agrees to not use or | ||||||
15 | disclose the information for employment-related
actions | ||||||
16 | and decisions or in connection with any other benefit or
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17 | employee benefit plan of the plan sponsor. | ||||||
18 | (4) Provide that the plan sponsor agrees to report to | ||||||
19 | the group health plan any use or disclosure of the
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20 | information that is inconsistent with the uses or | ||||||
21 | disclosures provided
for of which it becomes aware. | ||||||
22 | (5) Provide that the plan sponsor agrees to make | ||||||
23 | available the information required to provide an | ||||||
24 | accounting
of disclosures. | ||||||
25 | (6) Provide that the plan sponsor agrees to make its | ||||||
26 | internal practices, books, and records relating to the
use | ||||||
27 | and disclosure of the summary health information received | ||||||
28 | from the
group health plan available to the Director for | ||||||
29 | purposes of determining
compliance by the group health plan | ||||||
30 | with this Section. | ||||||
31 | (7) Provide that the plan sponsor agrees to, if | ||||||
32 | feasible, return or destroy all protected health | ||||||
33 | information
received from the group health plan that the | ||||||
34 | sponsor still maintains in
any form and retain no copies of | ||||||
35 | such information when no longer needed
for the purpose for | ||||||
36 | which disclosure was made, except that, if such
return or |
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1 | destruction is not feasible, limit further uses and
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2 | disclosures to those purposes that make the return or | ||||||
3 | destruction of the
information infeasible. | ||||||
4 | (c) A health insurance issuer may not report any | ||||||
5 | information required under
this Section the release of which is | ||||||
6 | prohibited by State or federal law or
regulation.
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7 | (d) A health insurance issuer must provide information | ||||||
8 | under this Section in
the aggregate, without any information | ||||||
9 | through which a specific individual
covered under the plan may | ||||||
10 | be identified.
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11 | (e) Information obtained by a plan sponsor under this | ||||||
12 | Section is
confidential. The sponsor may use the information | ||||||
13 | only for purposes relating to
obtaining and maintaining health | ||||||
14 | insurance coverage for the sponsor's
employees (if the sponsor | ||||||
15 | is an employer) or members (if the sponsor is an
employee | ||||||
16 | organization).
| ||||||
17 | Section 10. The Health Care Purchasing Group Act is amended | ||||||
18 | by changing
Section 5 as follows:
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19 | (215 ILCS 123/5)
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20 | Sec. 5. Purpose; applicability of Illinois Health | ||||||
21 | Insurance Portability
and Accountability Act.
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22 | (a) The purpose and intent of this Act is
to authorize the | ||||||
23 | formation, operation, and regulation of health care
purchasing | ||||||
24 | groups (referred to in this Act as "HPGs") as described by
this | ||||||
25 | Act, to authorize the sale and regulation of health
insurance | ||||||
26 | products for employers that are sold to HPGs, and to
encourage | ||||||
27 | the development of financially secure and cost
effective | ||||||
28 | markets for the basic health care needs of employers,
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29 | employees, and their dependents in this State.
Nothing in this | ||||||
30 | Act authorizes an employer to join with other employers to
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31 | self-insure through risk pooling.
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32 | (b) All health insurance contracts issued under this Act | ||||||
33 | are subject to
the Illinois Health Insurance Portability and | ||||||
34 | Accountability Act.
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1 | (c) All health insurance contracts issued under this Act | ||||||
2 | are subject to
Section 367.4 of the Illinois Insurance Code.
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3 | (Source: P.A. 90-337, eff. 1-1-98; 90-567, eff. 1-23-98.)
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4 | Section 15. The Health Maintenance Organization Act is | ||||||
5 | amended by changing
Section 5-3 as follows:
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6 | (215 ILCS 125/5-3) (from Ch. 111 1/2, par. 1411.2)
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7 | Sec. 5-3. Insurance Code provisions.
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8 | (a) Health Maintenance Organizations
shall be subject to | ||||||
9 | the provisions of Sections 133, 134, 137, 140, 141.1,
141.2, | ||||||
10 | 141.3, 143, 143c, 147, 148, 149, 151,
152, 153, 154, 154.5, | ||||||
11 | 154.6,
154.7, 154.8, 155.04, 355.2, 356m, 356v, 356w, 356x, | ||||||
12 | 356y,
356z.2, 356z.4, 356z.5, 367.2, 367.2-5, 367.4, 367i, | ||||||
13 | 368a, 368b, 368c,
368d, 368e,
401, 401.1, 402, 403, 403A,
408, | ||||||
14 | 408.2, 409, 412, 444,
and
444.1,
paragraph (c) of subsection | ||||||
15 | (2) of Section 367, and Articles IIA, VIII 1/2,
XII,
XII 1/2, | ||||||
16 | XIII, XIII 1/2, XXV, and XXVI of the Illinois Insurance Code.
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17 | (b) For purposes of the Illinois Insurance Code, except for | ||||||
18 | Sections 444
and 444.1 and Articles XIII and XIII 1/2, Health | ||||||
19 | Maintenance Organizations in
the following categories are | ||||||
20 | deemed to be "domestic companies":
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21 | (1) a corporation authorized under the
Dental Service | ||||||
22 | Plan Act or the Voluntary Health Services Plans Act;
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23 | (2) a corporation organized under the laws of this | ||||||
24 | State; or
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25 | (3) a corporation organized under the laws of another | ||||||
26 | state, 30% or more
of the enrollees of which are residents | ||||||
27 | of this State, except a
corporation subject to | ||||||
28 | substantially the same requirements in its state of
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29 | organization as is a "domestic company" under Article VIII | ||||||
30 | 1/2 of the
Illinois Insurance Code.
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31 | (c) In considering the merger, consolidation, or other | ||||||
32 | acquisition of
control of a Health Maintenance Organization | ||||||
33 | pursuant to Article VIII 1/2
of the Illinois Insurance Code,
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34 | (1) the Director shall give primary consideration to |
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1 | the continuation of
benefits to enrollees and the financial | ||||||
2 | conditions of the acquired Health
Maintenance Organization | ||||||
3 | after the merger, consolidation, or other
acquisition of | ||||||
4 | control takes effect;
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5 | (2)(i) the criteria specified in subsection (1)(b) of | ||||||
6 | Section 131.8 of
the Illinois Insurance Code shall not | ||||||
7 | apply and (ii) the Director, in making
his determination | ||||||
8 | with respect to the merger, consolidation, or other
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9 | acquisition of control, need not take into account the | ||||||
10 | effect on
competition of the merger, consolidation, or | ||||||
11 | other acquisition of control;
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12 | (3) the Director shall have the power to require the | ||||||
13 | following
information:
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14 | (A) certification by an independent actuary of the | ||||||
15 | adequacy
of the reserves of the Health Maintenance | ||||||
16 | Organization sought to be acquired;
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17 | (B) pro forma financial statements reflecting the | ||||||
18 | combined balance
sheets of the acquiring company and | ||||||
19 | the Health Maintenance Organization sought
to be | ||||||
20 | acquired as of the end of the preceding year and as of | ||||||
21 | a date 90 days
prior to the acquisition, as well as pro | ||||||
22 | forma financial statements
reflecting projected | ||||||
23 | combined operation for a period of 2 years;
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24 | (C) a pro forma business plan detailing an | ||||||
25 | acquiring party's plans with
respect to the operation | ||||||
26 | of the Health Maintenance Organization sought to
be | ||||||
27 | acquired for a period of not less than 3 years; and
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28 | (D) such other information as the Director shall | ||||||
29 | require.
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30 | (d) The provisions of Article VIII 1/2 of the Illinois | ||||||
31 | Insurance Code
and this Section 5-3 shall apply to the sale by | ||||||
32 | any health maintenance
organization of greater than 10% of its
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33 | enrollee population (including without limitation the health | ||||||
34 | maintenance
organization's right, title, and interest in and to | ||||||
35 | its health care
certificates).
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36 | (e) In considering any management contract or service |
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1 | agreement subject
to Section 141.1 of the Illinois Insurance | ||||||
2 | Code, the Director (i) shall, in
addition to the criteria | ||||||
3 | specified in Section 141.2 of the Illinois
Insurance Code, take | ||||||
4 | into account the effect of the management contract or
service | ||||||
5 | agreement on the continuation of benefits to enrollees and the
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6 | financial condition of the health maintenance organization to | ||||||
7 | be managed or
serviced, and (ii) need not take into account the | ||||||
8 | effect of the management
contract or service agreement on | ||||||
9 | competition.
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10 | (f) Except for small employer groups as defined in the | ||||||
11 | Small Employer
Rating, Renewability and Portability Health | ||||||
12 | Insurance Act and except for
medicare supplement policies as | ||||||
13 | defined in Section 363 of the Illinois
Insurance Code, a Health | ||||||
14 | Maintenance Organization may by contract agree with a
group or | ||||||
15 | other enrollment unit to effect refunds or charge additional | ||||||
16 | premiums
under the following terms and conditions:
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17 | (i) the amount of, and other terms and conditions with | ||||||
18 | respect to, the
refund or additional premium are set forth | ||||||
19 | in the group or enrollment unit
contract agreed in advance | ||||||
20 | of the period for which a refund is to be paid or
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21 | additional premium is to be charged (which period shall not | ||||||
22 | be less than one
year); and
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23 | (ii) the amount of the refund or additional premium | ||||||
24 | shall not exceed 20%
of the Health Maintenance | ||||||
25 | Organization's profitable or unprofitable experience
with | ||||||
26 | respect to the group or other enrollment unit for the | ||||||
27 | period (and, for
purposes of a refund or additional | ||||||
28 | premium, the profitable or unprofitable
experience shall | ||||||
29 | be calculated taking into account a pro rata share of the
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30 | Health Maintenance Organization's administrative and | ||||||
31 | marketing expenses, but
shall not include any refund to be | ||||||
32 | made or additional premium to be paid
pursuant to this | ||||||
33 | subsection (f)). The Health Maintenance Organization and | ||||||
34 | the
group or enrollment unit may agree that the profitable | ||||||
35 | or unprofitable
experience may be calculated taking into | ||||||
36 | account the refund period and the
immediately preceding 2 |
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1 | plan years.
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2 | The Health Maintenance Organization shall include a | ||||||
3 | statement in the
evidence of coverage issued to each enrollee | ||||||
4 | describing the possibility of a
refund or additional premium, | ||||||
5 | and upon request of any group or enrollment unit,
provide to | ||||||
6 | the group or enrollment unit a description of the method used | ||||||
7 | to
calculate (1) the Health Maintenance Organization's | ||||||
8 | profitable experience with
respect to the group or enrollment | ||||||
9 | unit and the resulting refund to the group
or enrollment unit | ||||||
10 | or (2) the Health Maintenance Organization's unprofitable
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11 | experience with respect to the group or enrollment unit and the | ||||||
12 | resulting
additional premium to be paid by the group or | ||||||
13 | enrollment unit.
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14 | In no event shall the Illinois Health Maintenance | ||||||
15 | Organization
Guaranty Association be liable to pay any | ||||||
16 | contractual obligation of an
insolvent organization to pay any | ||||||
17 | refund authorized under this Section.
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18 | (Source: P.A. 92-764, eff. 1-1-03; 93-102, eff. 1-1-04; 93-261, | ||||||
19 | eff. 1-1-04;
93-477, eff. 8-8-03; 93-529, eff. 8-14-03; revised | ||||||
20 | 9-25-03.)
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21 | Section 20. The Limited Health Service Organization Act is | ||||||
22 | amended by
changing Section 4003 as follows:
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23 | (215 ILCS 130/4003) (from Ch. 73, par. 1504-3)
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24 | Sec. 4003. Illinois Insurance Code provisions. Limited | ||||||
25 | health service
organizations shall be subject to the provisions | ||||||
26 | of Sections 133, 134, 137,
140, 141.1, 141.2, 141.3, 143, 143c, | ||||||
27 | 147, 148, 149, 151, 152, 153, 154, 154.5,
154.6, 154.7, 154.8, | ||||||
28 | 155.04, 155.37, 355.2, 356v, 367.4, 368a, 401, 401.1,
402,
403, | ||||||
29 | 403A, 408,
408.2, 409, 412, 444, and 444.1 and Articles IIA, | ||||||
30 | VIII 1/2, XII, XII 1/2,
XIII,
XIII 1/2, XXV, and XXVI of the | ||||||
31 | Illinois Insurance Code. For purposes of the
Illinois Insurance | ||||||
32 | Code, except for Sections 444 and 444.1 and Articles XIII
and | ||||||
33 | XIII 1/2, limited health service organizations in the following | ||||||
34 | categories
are deemed to be domestic companies:
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1 | (1) a corporation under the laws of this State; or
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2 | (2) a corporation organized under the laws of another | ||||||
3 | state, 30% of more
of the enrollees of which are residents | ||||||
4 | of this State, except a corporation
subject to | ||||||
5 | substantially the same requirements in its state of | ||||||
6 | organization as
is a domestic company under Article VIII | ||||||
7 | 1/2 of the Illinois Insurance Code.
| ||||||
8 | (Source: P.A. 91-549, eff. 8-14-99; 91-605, eff. 12-14-99; | ||||||
9 | 91-788, eff.
6-9-00; 92-440, eff. 8-17-01.)
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10 | Section 25. The Voluntary Health Services Plans Act is | ||||||
11 | amended by changing
Section 10 as follows:
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12 | (215 ILCS 165/10) (from Ch. 32, par. 604)
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13 | Sec. 10. Application of Insurance Code provisions. Health | ||||||
14 | services
plan corporations and all persons interested therein | ||||||
15 | or dealing therewith
shall be subject to the provisions of | ||||||
16 | Articles IIA and XII 1/2 and Sections
3.1, 133, 140, 143, 143c, | ||||||
17 | 149, 155.37, 354, 355.2, 356r, 356t, 356u, 356v,
356w, 356x, | ||||||
18 | 356y, 356z.1, 356z.2, 356z.4, 356z.5, 367.2, 367.4, 368a,
401, | ||||||
19 | 401.1,
402,
403, 403A, 408,
408.2, and 412, and paragraphs (7) | ||||||
20 | and (15) of Section 367 of the Illinois
Insurance Code.
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21 | (Source: P.A. 92-130, eff. 7-20-01; 92-440, eff. 8-17-01;
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22 | 92-651, eff. 7-11-02; 92-764, eff. 1-1-03; 93-102, eff. 1-1-04; | ||||||
23 | 93-529, eff.
8-14-03; revised 9-25-03.)
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