Sen. Laura Fine

Filed: 3/21/2023

 

 


 

 


 
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1
AMENDMENT TO SENATE BILL 1912

2    AMENDMENT NO. ______. Amend Senate Bill 1912 by replacing
3everything after the enacting clause with the following:
 
4    "Section 5. The Department of Insurance Law is amended by
5adding Section 1405-26 as follows:
 
6    (20 ILCS 1405/1405-26 new)
7    Sec. 1405-26. Office of the Healthcare Advocate.
8    (a) The Department of Insurance shall establish the Office
9of the Healthcare Advocate within the State health benefits
10exchange established by the State of Illinois in accordance
11with Section 1311 of the federal Patient Protection and
12Affordable Care Act. The Office shall be administered by the
13Chief Health Care Advocate, who shall report to the Director.
14The Advocate shall be an individual with expertise and
15experience in the fields of health insurance and consumer
16advocacy. The Advocate may employ legal counsel, independent

 

 

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1actuaries, and other employees and contractors as needed to
2carry out the duties of the Office.
3    (b) The Advocate shall evaluate data, in consultation with
4an actuary, to assess individual and small group health
5benefit plan rate filings, networks, and affordability; and
6represent the interests of individuals and small business
7owners in public hearings held pursuant to subsection (e) of
8Section 355 of the Illinois Insurance Code and subsection (f)
9of Section 4-12 of the Health Maintenance Organization Act.
10    (c) The Advocate shall have access to the unredacted
11actuarial memos that insurers send to the Department as part
12of the rate filings.
13    (d) The Advocate shall develop and recommend affordability
14standards that must be considered by the Director in any
15decision to approve, disapprove, or modify rates. These
16affordability standards include, but are not limited to, the
17following:
18        (1) trends, including historical rates for existing
19    products and national and regional medical and health
20    insurance trends;
21        (2) inflation;
22        (3) price comparisons to other market rates for
23    similar products;
24        (4) the ability of low-income individuals to pay for
25    health insurance;
26        (5) the ability of small businesses to pay for health

 

 

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1    insurance;
2        (6) health insurers' efforts to control administrative
3    costs; and
4        (7) effective strategies implemented by health
5    insurers to increase affordability, including payment
6    reform across the delivery system.
7    (e) In the performance of the Advocate's duties, the
8Advocate shall act independently of the Department. Any
9recommendations made or positions taken by the Advocate do not
10reflect those of the Department.
11    (f) The Department may adopt reasonable rules necessary to
12implement this Section.
 
13    Section 10. The Illinois Insurance Code is amended by
14changing Section 355 as follows:
 
15    (215 ILCS 5/355)  (from Ch. 73, par. 967)
16    Sec. 355. Accident and health policies; provisions.
17policies-Provisions.)
18    (a) As used in this Section:
19    "Inadequate rate" means a rate:
20        (1) that is insufficient to sustain projected losses
21    and expenses to which the rate applies; and
22        (2) the continued use of which endangers the solvency
23    of an insurer using that rate.
24    "Plain language" shall have the same meaning as "plain

 

 

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1writing" as used in the federal Plain Writing Act of 2010, and
2subsequent guidance documents, including the Federal Plain
3Language Guidelines.
4    "Unreasonable rate increase" means a rate increase that
5the Director determines to be excessive, unjustified, or
6unfairly discriminatory in accordance with 45 CFR 154.205.
7    (b) No policy of insurance against loss or damage from the
8sickness, or from the bodily injury or death of the insured by
9accident shall be issued or delivered to any person in this
10State until a copy of the form thereof and of the
11classification of risks and the premium rates pertaining
12thereto have been filed with the Director; nor shall it be so
13issued or delivered until the Director shall have approved
14such policy pursuant to the provisions of Section 143. If the
15Director disapproves the policy form he shall make a written
16decision stating the respects in which such form does not
17comply with the requirements of law and shall deliver a copy
18thereof to the company and it shall be unlawful thereafter for
19any such company to issue any policy in such form.
20    (c) Beginning for plan year 2026, rate increases for all
21individual and small group accident and health insurance
22policies subject to the standards of 45 CFR Part 154 must be
23filed with the Department for approval. Unreasonable rate
24increases or inadequate rates shall be modified or
25disapproved.
26    (d) Beginning for plan year 2025, when an insurer files a

 

 

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1schedule or table of premium rates for individual or small
2group health benefit plans, the insurer shall post notice of
3the rate filing and a filing summary in plain language on the
4insurer's website. The Department shall post all insurers'
5rate filings and summaries on the Department's website. All
6summaries shall include a brief justification of any rate
7increase or decrease requested, including the number of
8individual members, the medical loss ratio, medical trend,
9administrative costs, and any other information requested by
10the Director. The plain language summary shall include
11notification of the public comment period established in
12subsection (e).
13    (e) The Department shall open a 30-day public comment
14period on the rate filings beginning on the date that all of
15the rate filings are posted on the website. The Department
16shall post all of the comments received to the Department's
17website within 5 business days after the comment period ends.
18    (f) The Department shall hold a public hearing within 10
19days after the public comments are posted on the Department's
20website. All insurers and health maintenance organizations
21selling plans in the individual and small group markets shall
22appear at the public hearing to explain their rate filings and
23justifications.
24    (g) After the close of the public comment period described
25in subsection (e), the Department shall issue a decision to
26approve, disapprove, or modify a rate filing. The Department

 

 

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1shall notify the insurer of the decision, make the decision
2available to the public by posting it on the Department's
3website, and include an explanation of the findings and
4rationale that are the basis for the decision.
5    (h) If, following the issuance of a decision but before
6the effective date of the premium rates approved by the
7decision, an event occurs that materially affects the
8Director's decision to approve, deny, or modify the rates, the
9Director may consider supplemental facts or data reasonably
10related to the event.
11    (i) The Department shall adopt rules implementing the
12procedures described in subsections (d) through (h).
13(Source: P.A. 79-777.)
 
14    Section 15. The Health Maintenance Organization Act is
15amended by changing Section 4-12 as follows:
 
16    (215 ILCS 125/4-12)  (from Ch. 111 1/2, par. 1409.5)
17    Sec. 4-12. Changes in Rate Methodology and Benefits,
18Material Modifications. A health maintenance organization
19shall file with the Director, prior to use, a notice of any
20change in rate methodology, or benefits and of any material
21modification of any matter or document furnished pursuant to
22Section 2-1, together with such supporting documents as are
23necessary to fully explain the change or modification.
24    (a) Contract modifications described in subsections

 

 

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1(c)(5), (c)(6) and (c)(7) of Section 2-1 shall include all
2form agreements between the organization and enrollees,
3providers, administrators of services and insurers of health
4maintenance organizations.
5    (b) Material transactions or series of transactions other
6than those described in subsection (a) of this Section, the
7total annual value of which exceeds the greater of $100,000 or
85% of net earned subscription revenue for the most current
9twelve month period as determined from filed financial
10statements.
11    (c) Any agreement between the organization and an insurer
12shall be subject to the provisions of the laws of this State
13regarding reinsurance as provided in Article XI of the
14Illinois Insurance Code. All reinsurance agreements must be
15filed. Approval of the Director is required for all agreements
16except the following: individual stop loss, aggregate excess,
17hospitalization benefits or out-of-area of the participating
18providers unless 20% or more of the organization's total risk
19is reinsured, in which case all reinsurance agreements require
20approval.
21    (d) Beginning for plan year 2026, rate increases for all
22individual and small group accident and health insurance
23policies subject to the standards of 45 CFR Part 154 must be
24filed with the Department for approval. Unreasonable rate
25increases in relation to benefits under the policy provided or
26inadequate rates shall be modified or disapproved.

 

 

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1    (e) Beginning for plan year 2025, when a health
2maintenance organization files a schedule or table of premium
3rates for individual or small group health benefit plans, the
4health maintenance organization shall post notice of the rate
5filing and a filing summary in plain language on the
6organization's website. The Department shall post all
7insurers' rate filings and summaries on the Department's
8website. All summaries shall include a brief justification of
9any rate increase or decrease requested, including the number
10of individual members, the medical loss ratio, medical trend,
11administrative costs, and any other information requested by
12the Director. The plain language summary shall include
13notification of the public comment period established in
14subsection (f).
15    (f) The Department shall open a 30-day public comment
16period on the rate filings beginning on the date that all of
17the rate filings are posted on the website. The Department
18shall post all of the comments received to the Department's
19website within 5 business days after the comment period ends.
20    (g) The Department shall hold a public hearing within 10
21days after the public comments are posted on the Department's
22website. All insurers and health maintenance organizations
23selling plans in the individual and small group markets shall
24appear at the public hearing to explain their rate filings and
25justifications.
26    (h) After the close of the public comment period described

 

 

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1in subsection (f), the Department shall issue a decision to
2approve, disapprove, or modify a rate filing. The Department
3shall notify the health maintenance organization of the
4decision, make the decision available to the public by posting
5it on the Department's website, and include an explanation of
6the findings and rationale that are the basis for the
7decision.
8    (i) If, following the issuance of a decision but before
9the effective date of the premium rates approved by the
10decision, an event occurs that materially affects the
11Director's decision to approve, deny, or modify the rates, the
12Director may consider supplemental facts or data reasonably
13related to the event.
14    (j) The Department shall adopt rules implementing the
15procedures described in subsections (e) through (i).
16    (k) As used in this Section:
17    "Inadequate rate" means a rate:
18        (1) that is insufficient to sustain projected losses
19    and expenses to which the rate applies; and
20        (2) the continued use of which endangers the solvency
21    of an insurer using that rate.
22    "Plain language" shall have the same meaning as "plain
23writing" as used in the federal Plain Writing Act of 2010, and
24subsequent guidance documents, including the Federal Plain
25Language Guidelines.
26    "Unreasonable rate increase" means a rate increase that

 

 

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1the Director determines to be excessive, unjustified, or
2unfairly discriminatory in accordance with 45 CFR 154.205.
3(Source: P.A. 86-620.)".