Rep. Mary E. Flowers
Filed: 5/1/2008
 
 

 




 

 		












09500HB2286ham001

LRB095 01343 RPM 49610 a






1

AMENDMENT TO HOUSE BILL 2286




2
    AMENDMENT NO. ______. Amend House Bill 2286 by replacing 
3
everything after the enacting clause with the following:


 
4
    "Section 5. The State Employees Group Insurance Act of 1971 
5
is amended  by changing Section 6.11 as follows:
 


6
    (5 ILCS 375/6.11)


7
    Sec. 6.11. Required health benefits; Illinois Insurance 
8
Code
requirements.  The program of health
benefits shall provide 
9
the post-mastectomy care benefits required to be covered
by a 
10
policy of accident and health insurance under Section 356t of 
11
the Illinois
Insurance Code.  The program of health benefits 
12
shall provide the coverage
required under Sections 356f.1, 
13
356g.5,
356u, 356w, 356x, 356z.2, 356z.4, 356z.6, and 356z.9, 
14
and 356z.10
356z.9 of the
Illinois Insurance Code.
The program 
15
of health benefits must comply with Section 155.37 of the

16
Illinois Insurance Code.

 


 






09500HB2286ham001
- 2 -
LRB095 01343 RPM 49610 a




1
(Source: P.A. 95-189, eff. 8-16-07; 95-422, eff. 8-24-07; 
2
95-520, eff. 8-28-07; revised 12-4-07.)

 
3
    Section 10. The Counties Code is amended  by changing 
4
Section 5-1069.3 as follows:
 
5
    (55 ILCS 5/5-1069.3)

6
    Sec. 5-1069.3. Required health benefits.   If a county, 
7
including a home
rule
county, is a self-insurer for purposes of 
8
providing health insurance coverage
for its employees, the 
9
coverage shall include coverage for the post-mastectomy
care 
10
benefits required to be covered by a policy of accident and 
11
health
insurance under Section 356t and the coverage required 
12
under Sections 356f.1, 356g.5, 356u,
356w, 356x, 356z.6, and 
13
356z.9, and 356z.10
356z.9 of
the Illinois Insurance Code.  The 
14
requirement that health benefits be covered
as provided in this 
15
Section is an
exclusive power and function of the State and is 
16
a denial and limitation under
Article VII, Section 6, 
17
subsection (h) of the Illinois Constitution.  A home
rule county 
18
to which this Section applies must comply with every provision 
19
of
this Section.


20
(Source: P.A. 95-189, eff. 8-16-07; 95-422, eff. 8-24-07; 
21
95-520, eff. 8-28-07; revised 12-4-07.)

 
22
    Section 15. The Illinois Municipal Code is amended  by 
23
changing Section 10-4-2.3 as follows:
 
 


 






09500HB2286ham001
- 3 -
LRB095 01343 RPM 49610 a




1
    (65 ILCS 5/10-4-2.3)

2
    Sec. 10-4-2.3. Required health benefits.   If a 
3
municipality, including a
home rule municipality, is a 
4
self-insurer for purposes of providing health
insurance 
5
coverage for its employees, the coverage shall include coverage 
6
for
the post-mastectomy care benefits required to be covered by 
7
a policy of
accident and health insurance under Section 356t 
8
and the coverage required
under Sections 356f.1, 356g.5, 356u, 
9
356w, 356x, 356z.6, and 356z.9, and  356z.10
356z.9 of the 
10
Illinois
Insurance
Code.  The requirement that health
benefits 
11
be covered as provided in this is an exclusive power and 
12
function of
the State and is a denial and limitation under 
13
Article VII, Section 6,
subsection (h) of the Illinois 
14
Constitution.  A home rule municipality to which
this Section 
15
applies must comply with every provision of this Section.


16
(Source: P.A. 95-189, eff. 8-16-07; 95-422, eff. 8-24-07; 
17
95-520, eff. 8-28-07; revised 12-4-07.)




 
18
    Section 20. The School Code is amended  by changing Section 
19
10-22.3f as follows:
 
20
    (105 ILCS 5/10-22.3f)

21
    Sec. 10-22.3f. Required health benefits.   Insurance 
22
protection and
benefits
for employees shall provide the 
23
post-mastectomy care benefits required to be
covered by a 
 


 






09500HB2286ham001
- 4 -
LRB095 01343 RPM 49610 a




1
policy of accident and health insurance under Section 356t and 
2
the
coverage required under Sections 356f.1, 356g.5, 356u, 
3
356w, 356x,

356z.6, and 356z.9 of
the
Illinois Insurance Code.


4
(Source: P.A. 95-189, eff. 8-16-07; 95-422, eff. 8-24-07; 
5
revised 12-4-07.)


 
6
    Section 25. The Illinois Insurance Code  is amended  by 
7
adding Section 356f.1 as follows:
 
8
    (215 ILCS 5/356f.1 new)

9
    Sec. 356f.1. Recision, cancellation, or limiting of a plan 
10
contract.
11
    (a) No insurer or health care service plan shall engage in 
12
the practice of postclaims underwriting. For purposes of this 
13
Section, "postclaims underwriting" means the rescinding, 
14
canceling, or limiting of a plan contract due to the plan's 
15
failure to complete medical underwriting and resolve all 
16
reasonable questions arising from written information 
17
submitted on or with an application before issuing the plan 
18
contract. This subsection (a) shall not limit a plan's remedies 
19
upon a showing of willful misrepresentation.
20
    (b) Notwithstanding any other provision of law, a health 
21
care service plan shall seek and receive final approval from 
22
the Division of Insurance prior to rescinding a plan contract 
23
of a subscriber or enrollee. No later than January 1, 2010, the 
24
Department shall contract with one or more appropriately 
 


 






09500HB2286ham001
- 5 -
LRB095 01343 RPM 49610 a




1
qualified independent review organizations to conduct the 
2
review required by this subsection (b). The Department shall 
3
ensure that the review organization shall not have any 
4
material, professional, familial, or financial affiliation 
5
with the health care service plan.
6
    (c) Notwithstanding any other rulemaking authority that 
7
may exist, neither the Governor nor any agency or agency head 
8
under the jurisdiction of the Governor has any authority to 
9
make or promulgate rules to implement or enforce the provisions 
10
of this amendatory Act of the 95th General Assembly.  If, 
11
however, the Governor believes that rules are necessary to 
12
implement or enforce the provisions of this amendatory Act of 
13
the 95th General Assembly, the Governor may suggest rules to 
14
the General Assembly by filing them with the Clerk of the House 
15
and the Secretary of the Senate and by requesting that the 
16
General Assembly authorize such rulemaking by law, enact those 
17
suggested rules into law, or take any other appropriate action 
18
in the General Assembly's discretion.   Nothing contained in this 
19
amendatory Act of the 95th General Assembly shall be 
20
interpreted to grant rulemaking authority under any other 
21
Illinois statute where such authority is not otherwise 
22
explicitly given.  For the purposes of this amendatory Act of 
23
the 95th General Assembly, "rules" is given the meaning 
24
contained in Section 1-70 of the Illinois Administrative 
25
Procedure Act, and "agency" and "agency head" are given the 
26
meanings contained in Sections 1-20 and 1-25 of the Illinois 
 


 






09500HB2286ham001
- 6 -
LRB095 01343 RPM 49610 a




1
Administrative Procedure Act to the extent that such 
2
definitions apply to agencies or agency heads under the 
3
jurisdiction of the Governor.


 
4
    Section 30. The Health Maintenance Organization Act is 
5
amended  by changing Section 5-3 as follows:
 


6
    (215 ILCS 125/5-3)  (from Ch. 111 1/2, par. 1411.2)


7
    Sec. 5-3. Insurance Code provisions. 

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, 356f.1, 356m, 356v, 356w, 
12
356x, 356y,
356z.2, 356z.4, 356z.5, 356z.6, 356z.8, 356z.9, 
13
356z.10
356z.9, 364.01, 367.2, 367.2-5, 367i, 368a, 368b, 368c, 
14
368d, 368e, 370c,
401, 401.1, 402, 403, 403A,
408, 408.2, 409, 
15
412, 444,
and
444.1,
paragraph (c) of subsection (2) of Section 
16
367, and Articles IIA, VIII 1/2,
XII,
XII 1/2, XIII, XIII 1/2, 
17
XXV, and XXVI of the Illinois Insurance Code.

18
    (b) For purposes of the Illinois Insurance Code, except for 
19
Sections 444
and 444.1 and Articles XIII and XIII 1/2, Health 
20
Maintenance Organizations in
the following categories are 
21
deemed to be "domestic companies":


22
        (1) a corporation authorized under the
Dental Service 
23
    Plan Act or the Voluntary Health Services Plans Act;


24
        (2) a corporation organized under the laws of this 
 


 






09500HB2286ham001
- 7 -
LRB095 01343 RPM 49610 a




1
    State; or


2
        (3) a corporation organized under the laws of another 
3
    state, 30% or 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
    (c) In considering the merger, consolidation, or other 
9
acquisition of
control of a Health Maintenance Organization 
10
pursuant to Article VIII 1/2
of the Illinois Insurance Code,


11
        (1) the Director shall give primary consideration to 
12
    the continuation of
benefits to enrollees and the financial 
13
    conditions of the acquired Health
Maintenance Organization 
14
    after the merger, consolidation, or other
acquisition of 
15
    control takes effect;


16
        (2)(i) the criteria specified in subsection (1)(b) of 
17
    Section 131.8 of
the Illinois Insurance Code shall not 
18
    apply and (ii) the Director, in making
his determination 
19
    with respect to the merger, consolidation, or other

20
    acquisition of control, need not take into account the 
21
    effect on
competition of the merger, consolidation, or 
22
    other acquisition of control;


23
        (3) the Director shall have the power to require the 
24
    following
information:


25
            (A) certification by an independent actuary of the 
26
        adequacy
of the reserves of the Health Maintenance 
 


 






09500HB2286ham001
- 8 -
LRB095 01343 RPM 49610 a




1
        Organization sought to be acquired;


2
            (B) pro forma financial statements reflecting the 
3
        combined balance
sheets of the acquiring company and 
4
        the Health Maintenance Organization sought
to be 
5
        acquired as of the end of the preceding year and as of 
6
        a date 90 days
prior to the acquisition, as well as pro 
7
        forma financial statements
reflecting projected 
8
        combined operation for a period of 2 years;


9
            (C) a pro forma business plan detailing an 
10
        acquiring party's plans with
respect to the operation 
11
        of the Health Maintenance Organization sought to
be 
12
        acquired for a period of not less than 3 years; and


13
            (D) such other information as the Director shall 
14
        require.

15
    (d) The provisions of Article VIII 1/2 of the Illinois 
16
Insurance Code
and this Section 5-3 shall apply to the sale by 
17
any health maintenance
organization of greater than 10% of its

18
enrollee population (including without limitation the health 
19
maintenance
organization's right, title, and interest in and to 
20
its health care
certificates).

21
    (e) In considering any management contract or service 
22
agreement subject
to Section 141.1 of the Illinois Insurance 
23
Code, the Director (i) shall, in
addition to the criteria 
24
specified in Section 141.2 of the Illinois
Insurance Code, take 
25
into account the effect of the management contract or
service 
26
agreement on the continuation of benefits to enrollees and the

 


 






09500HB2286ham001
- 9 -
LRB095 01343 RPM 49610 a




1
financial condition of the health maintenance organization to 
2
be managed or
serviced, and (ii) need not take into account the 
3
effect of the management
contract or service agreement on 
4
competition.

5
    (f) Except for small employer groups as defined in the 
6
Small Employer
Rating, Renewability and Portability Health 
7
Insurance Act and except for
medicare supplement policies as 
8
defined in Section 363 of the Illinois
Insurance Code, a Health 
9
Maintenance Organization may by contract agree with a
group or 
10
other enrollment unit to effect refunds or charge additional 
11
premiums
under the following terms and conditions:


12
        (i) the amount of, and other terms and conditions with 
13
    respect to, the
refund or additional premium are set forth 
14
    in the group or enrollment unit
contract agreed in advance 
15
    of the period for which a refund is to be paid or

16
    additional premium is to be charged (which period shall not 
17
    be less than one
year); and


18
        (ii) the amount of the refund or additional premium 
19
    shall not exceed 20%
of the Health Maintenance 
20
    Organization's profitable or unprofitable experience
with 
21
    respect to the group or other enrollment unit for the 
22
    period (and, for
purposes of a refund or additional 
23
    premium, the profitable or unprofitable
experience shall 
24
    be calculated taking into account a pro rata share of the

25
    Health Maintenance Organization's administrative and 
26
    marketing expenses, but
shall not include any refund to be 
 


 






09500HB2286ham001
- 10 -
LRB095 01343 RPM 49610 a




1
    made or additional premium to be paid
pursuant to this 
2
    subsection (f)).  The Health Maintenance Organization and 
3
    the
group or enrollment unit may agree that the profitable 
4
    or unprofitable
experience may be calculated taking into 
5
    account the refund period and the
immediately preceding 2 
6
    plan years.

7
    The Health Maintenance Organization shall include a 
8
statement in the
evidence of coverage issued to each enrollee 
9
describing the possibility of a
refund or additional premium, 
10
and upon request of any group or enrollment unit,
provide to 
11
the group or enrollment unit a description of the method used 
12
to
calculate (1) the Health Maintenance Organization's 
13
profitable experience with
respect to the group or enrollment 
14
unit and the resulting refund to the group
or enrollment unit 
15
or (2) the Health Maintenance Organization's unprofitable

16
experience with respect to the group or enrollment unit and the 
17
resulting
additional premium to be paid by the group or 
18
enrollment unit.

19
    In no event shall the Illinois Health Maintenance 
20
Organization
Guaranty Association be liable to pay any 
21
contractual obligation of an
insolvent organization to pay any 
22
refund authorized under this Section.

23
(Source: P.A. 94-906, eff. 1-1-07; 94-1076, eff. 12-29-06; 
24
95-422, eff. 8-24-07; 95-520, eff. 8-28-07; revised 12-4-07.)

 
25
    Section 35. The Limited Health Service Organization Act is 
 


 






09500HB2286ham001
- 11 -
LRB095 01343 RPM 49610 a




1
amended  by changing Section 4003 as follows:
 



2
    (215 ILCS 130/4003)  (from Ch. 73, par. 1504-3)


3
    Sec. 4003. Illinois Insurance Code provisions. Limited 
4
health service
organizations shall be subject to the provisions 
5
of Sections 133, 134, 137,
140, 141.1, 141.2, 141.3, 143, 143c, 
6
147, 148, 149, 151, 152, 153, 154, 154.5,
154.6, 154.7, 154.8, 
7
155.04, 155.37, 355.2, 356f.1, 356v, 356z.10
356z.9, 368a, 401, 
8
401.1,
402,
403, 403A, 408,
408.2, 409, 412, 444, and 444.1 and 
9
Articles IIA, VIII 1/2, XII, XII 1/2,
XIII,
XIII 1/2, XXV, and 
10
XXVI of the Illinois Insurance Code.  For purposes of the

11
Illinois Insurance Code, except for Sections 444 and 444.1 and 
12
Articles XIII
and XIII 1/2, limited health service 
13
organizations in the following categories
are deemed to be 
14
domestic companies:


15
        (1) a corporation under the laws of this State; or


16
        (2) a corporation organized under the laws of another 
17
    state, 30% of more
of the enrollees of which are residents 
18
    of this State, except a corporation
subject to 
19
    substantially the same requirements in its state of 
20
    organization as
is a domestic company under Article VIII 
21
    1/2 of the Illinois Insurance Code.

22
(Source: P.A. 95-520, eff. 8-28-07; revised 12-5-07.)


 
23
    Section 37. The Managed Care Reform and Patient Rights Act  
24
is amended  by changing Section 20 as follows:
 



 


 






09500HB2286ham001
- 12 -
LRB095 01343 RPM 49610 a




1
    (215 ILCS 134/20)


2
    Sec. 20. Notice of nonrenewal or termination. A health care 
3
plan must
give at least 60
days notice of nonrenewal or 
4
termination of a health
care provider to the health care

5
provider and to the enrollees served by the health care 
6
provider.
The notice shall include a name and address to which 
7
an enrollee or health care
provider may direct
comments and 
8
concerns regarding the nonrenewal or termination.
Immediate 
9
written notice may be provided without 60 days notice when a 
10
health
care provider's license has been disciplined by a State 
11
licensing board. All health care plans shall comply with 
12
Section 356f.1 of the Illinois Insurance Code. 

13
(Source: P.A. 91-617, eff. 1-1-00.)


 
14
    Section 40. The Voluntary Health Services Plans Act is 
15
amended  by changing Section 10 as follows:
 



16
    (215 ILCS 165/10)  (from Ch. 32, par. 604)


17
    Sec. 10. Application of Insurance Code provisions. Health 
18
services
plan corporations and all persons interested therein 
19
or dealing therewith
shall be subject to the provisions of 
20
Articles IIA and XII 1/2 and Sections
3.1, 133, 140, 143, 143c, 
21
149, 155.37, 354, 355.2, 356f.1, 356g.5, 356r, 356t, 356u, 
22
356v,
356w, 356x, 356y, 356z.1, 356z.2, 356z.4, 356z.5, 356z.6, 
23
356z.8, 356z.9,
356z.10
356z.9, 364.01, 367.2, 368a, 401, 
 


 






09500HB2286ham001
- 13 -
LRB095 01343 RPM 49610 a




1
401.1,
402,
403, 403A, 408,
408.2, and 412, and paragraphs (7) 
2
and (15) of Section 367 of the Illinois
Insurance Code.

3
(Source: P.A. 94-1076, eff. 12-29-06; 95-189, eff. 8-16-07; 
4
95-331, eff. 8-21-07; 95-422, eff. 8-24-07; 95-520, eff. 
5
8-28-07; revised 12-5-07.)".