96TH GENERAL ASSEMBLY
State of Illinois
2009 and 2010
SB1999

 

Introduced 2/20/2009, by Sen. Carole Pankau

 

SYNOPSIS AS INTRODUCED:
 
215 ILCS 5/367e   from Ch. 73, par. 979e

    Amends the Illinois Insurance Code. Makes a technical change in a Section concerning continuation of group hospital, surgical and major medical coverage after termination of employment or membership.


LRB096 11335 RPM 21783 b

 

 

A BILL FOR

 

SB1999 LRB096 11335 RPM 21783 b

1     AN ACT concerning regulation.
 
2     Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
 
4     Section 5. The Illinois Insurance Code is amended by
5 changing Section 367e as follows:
 
6     (215 ILCS 5/367e)  (from Ch. 73, par. 979e)
7     Sec. 367e. Continuation of Group Hospital, Surgical and and
8 Major Medical Coverage After Termination of Employment or
9 Membership. A group policy delivered, issued for delivery,
10 renewed or amended in this state which insures employees or
11 members for hospital, surgical or major medical insurance on an
12 expense incurred or service basis, other than for specific
13 diseases or for accidental injuries only, shall provide that
14 employees or members whose insurance under the group policy
15 would otherwise terminate because of termination of employment
16 or membership or because of a reduction in hours below the
17 minimum required by the group plan shall be entitled to
18 continue their hospital, surgical and major medical insurance
19 under that group policy, for themselves and their eligible
20 dependents, subject to all of the group policy's terms and
21 conditions applicable to those forms of insurance and to the
22 following conditions:
23         1. Continuation shall only be available to an employee

 

 

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1     or member who has been continuously insured under the group
2     policy (and for similar benefits under any group policy
3     which it replaced) during the entire 3 months period ending
4     with such termination or reduction in hours below the
5     minimum required by the group plan.
6         2. Continuation shall not be available for any person
7     who is covered by Medicare, except for those individuals
8     who have been covered under a group Medicare supplement
9     policy. Neither shall continuation be available for any
10     person who is covered by any other insured or uninsured
11     plan which provides hospital, surgical or medical coverage
12     for individuals in a group and under which the person was
13     not covered immediately prior to such termination or
14     reduction in hours below the minimum required by the group
15     plan or who exercises his conversion privilege under the
16     group policy.
17         3. Continuation need not include dental, vision care,
18     prescription drug benefits, disability income, specified
19     disease, or similar supplementary benefits which are
20     provided under the group policy in addition to its
21     hospital, surgical or major medical benefits.
22         4. Upon termination or reduction in hours below the
23     minimum required by the group plan written notice of
24     continuation shall be presented to the employee or member
25     by the employer or mailed by the employer to the last known
26     address of the employee. An employee or member who wishes

 

 

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1     continuation of coverage must request such continuation in
2     writing within the ten-day period following the later of:
3     (i) the date of such termination or reduction in hours
4     below the minimum required by the group plan, or (ii) the
5     date the employee is given written notice of the right of
6     continuation by either the employer or the group
7     policyholder. In no event, however, may the employee or
8     member elect continuation more than 60 days after the date
9     of such termination or reduction in hours below the minimum
10     required by the group plan. Written notice of continuation
11     presented to the employee or member by the policyholder, or
12     mailed by the policyholder to the last known address of the
13     employee, shall constitute the giving of notice for the
14     purpose of this provision.
15         5. An employee or member electing continuation must pay
16     to the group policyholder or his employer, on a monthly
17     basis in advance, the total amount of premium required by
18     the insurer, including that portion of the premium
19     contributed by the policyholder or employer, if any, but
20     not more than the group rate for the insurance being
21     continued with appropriate reduction in premium for any
22     supplementary benefits which have been discontinued under
23     paragraph (3) of this Section. The premium rate required by
24     the insurer shall be the applicable premium required on the
25     due date of each payment.
26         6. Continuation of insurance under the group policy for

 

 

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1     any person shall terminate when he becomes eligible for
2     Medicare or is covered by any other insured or uninsured
3     plan which provides hospital, surgical or medical coverage
4     for individuals in a group and under which the person was
5     not covered immediately prior to such termination or
6     reduction in hours below the minimum required by the group
7     plan as provided in condition 2 above or, if earlier, at
8     the first to occur of the following:
9             (a) The date 9 months after the date the employee's
10         or member's insurance under the policy would otherwise
11         have terminated because of termination of employment
12         or membership or reduction in hours below the minimum
13         required by the group plan.
14             (b) If the employee or member fails to make timely
15         payment of a required contribution, the end of the
16         period for which contributions were made.
17             (c) The date on which the group policy is
18         terminated or, in the case of an employee, the date his
19         employer terminates participation under the group
20         policy. However, if this (c) applies and the coverage
21         ceasing by reason of such termination is replaced by
22         similar coverage under another group policy, the
23         following shall apply:
24                 (i) The employee or member shall have the right
25             to become covered under that other group policy,
26             for the balance of the period that he would have

 

 

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1             remained covered under the prior group policy in
2             accordance with condition 6 had a termination
3             described in this (c) not occurred.
4                 (ii) The prior group policy shall continue to
5             provide benefits to the extent of its accrued
6             liabilities and extensions of benefits as if the
7             replacement had not occurred.
8         7. A notification of the continuation privilege shall
9     be included in each certificate of coverage.
10         8. Continuation shall not be available for any employee
11     who was discharged because of the commission of a felony in
12     connection with his work, or because of theft in connection
13     with his work, for which the employer was in no way
14     responsible; provided the employee admitted his commission
15     of the felony or theft or such act has resulted in a
16     conviction or order of supervision by a court of competent
17     jurisdiction.
18     The requirements of this amendatory Act of 1983 shall apply
19 to any group policy as defined in this Section, delivered or
20 issued for delivery on or after 180 days following the
21 effective date of this amendatory Act of 1983.
22     The requirements of this amendatory Act of 1985 shall apply
23 to any group policy as defined in this Section, delivered,
24 issued for delivery, renewed or amended on or after 180 days
25 following the effective date of this amendatory Act of 1985.
26 (Source: P.A. 93-477, eff. 1-1-04.)