SB1506 Engrossed LRB096 10769 RPM 20965 b

1     AN ACT concerning insurance.
 
2     Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
 
4     Section 1. Short title. This Act may be cited as the Health
5 Carrier External Review Act.
 
6     Section 5. Purpose and intent. The purpose of this Act is
7 to provide uniform standards for the establishment and
8 maintenance of external review procedures to assure that
9 covered persons have the opportunity for an independent review
10 of an adverse determination or final adverse determination, as
11 defined in this Act.
 
12     Section 10. Definitions. For the purposes of this Act:
13     "Adverse determination" means a determination by a health
14 carrier or its designee utilization review organization that an
15 admission, availability of care, continued stay, or other
16 health care service that is a covered benefit has been reviewed
17 and, based upon the information provided, does not meet the
18 health carrier's requirements for medical necessity,
19 appropriateness, health care setting, level of care, or
20 effectiveness, and the requested service or payment for the
21 service is therefore denied, reduced, or terminated.
22     "Authorized representative" means:

 

 

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1         (1) a person to whom a covered person has given express
2     written consent to represent the covered person in an
3     external review;
4         (2) a person authorized by law to provide substituted
5     consent for a covered person; or
6         (3) a family member of the covered person or the
7     covered person's health care provider only when the covered
8     person is unable to provide consent.
9     "Best evidence" means evidence based on:
10         (1) randomized clinical trials;
11         (2) if randomized clinical trials are not available,
12     then cohort studies or case-control studies;
13         (3) if items (1) and (2) are not available, then
14     case-series; or
15         (4) if items (1), (2), and (3) are not available, then
16     expert opinion.
17     "Case-series" means an evaluation of a series of patients
18 with a particular outcome, without the use of a control group.
19     "Clinical review criteria" means the written screening
20 procedures, decision abstracts, clinical protocols, and
21 practice guidelines used by a health carrier to determine the
22 necessity and appropriateness of health care services.
23     "Cohort study" means a prospective evaluation of 2 groups
24 of patients with only one group of patients receiving specific
25 intervention.
26     "Covered benefits" or "benefits" means those health care

 

 

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1 services to which a covered person is entitled under the terms
2 of a health benefit plan.
3     "Covered person" means a policyholder, subscriber,
4 enrollee, or other individual participating in a health benefit
5 plan.
6     "Director" means the Director of the Division of Insurance
7 within the Illinois Department of Financial and Professional
8 Regulation.
9     "Emergency medical condition" means the sudden onset of a
10 health condition or illness that requires immediate medical
11 attention, where failure to provide medical attention would
12 result in a serious impairment to bodily functions, serious
13 dysfunction of a bodily organ or part, or would place the
14 person's health in serious jeopardy.
15     "Emergency services" means health care items and services
16 furnished or required to evaluate and treat an emergency
17 medical condition.
18     "Evidence-based standard" means the conscientious,
19 explicit, and judicious use of the current best evidence based
20 on an overall systematic review of the research in making
21 decisions about the care of individual patients.
22     "Expert opinion" means a belief or an interpretation by
23 specialists with experience in a specific area about the
24 scientific evidence pertaining to a particular service,
25 intervention, or therapy.
26     "Facility" means an institution providing health care

 

 

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1 services or a health care setting.
2     "Final adverse determination" means an adverse
3 determination involving a covered benefit that has been upheld
4 by a health carrier, or its designee utilization review
5 organization, at the completion of the health carrier's
6 internal grievance process procedures as set forth by the
7 American Accreditation Health Care Commission.
8     "Health benefit plan" means a policy, contract,
9 certificate, plan, or agreement offered or issued by a health
10 carrier to provide, deliver, arrange for, pay for, or reimburse
11 any of the costs of health care services.
12     "Health care provider" or "provider" means a physician or
13 other health care practitioner licensed, accredited, or
14 certified to perform specified health care services consistent
15 with State law, responsible for recommending health care
16 services on behalf of a covered person.
17     "Health care services" means services for the diagnosis,
18 prevention, treatment, cure, or relief of a health condition,
19 illness, injury, or disease.
20     "Health carrier" means an entity subject to the insurance
21 laws and regulations of this State, or subject to the
22 jurisdiction of the Director, that contracts or offers to
23 contract to provide, deliver, arrange for, pay for, or
24 reimburse any of the costs of health care services, including a
25 sickness and accident insurance company, a health maintenance
26 organization, a nonprofit hospital and health service

 

 

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1 corporation, or any other entity providing a plan of health
2 insurance, health benefits, or health care services. "Health
3 carrier" also means Limited Health Service Organizations
4 (LHSO) and Voluntary Health Service Plans.
5     "Health carrier" does not include a managed care plan as
6 defined in the Managed Care Reform and Patient Rights Act.
7     "Health information" means information or data, whether
8 oral or recorded in any form or medium, and personal facts or
9 information about events or relationships that relate to:
10         (1) the past, present, or future physical, mental, or
11     behavioral health or condition of an individual or a member
12     of the individual's family;
13         (2) the provision of health care services to an
14     individual; or
15         (3) payment for the provision of health care services
16     to an individual.
17     "Independent review organization" means an entity that
18 conducts independent external reviews of adverse
19 determinations and final adverse determinations.
20     "Medical or scientific evidence" means evidence found in
21 the following sources:
22         (1) peer-reviewed scientific studies published in or
23     accepted for publication by medical journals that meet
24     nationally recognized requirements for scientific
25     manuscripts and that submit most of their published
26     articles for review by experts who are not part of the

 

 

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1     editorial staff;
2         (2) peer-reviewed medical literature, including
3     literature relating to therapies reviewed and approved by a
4     qualified institutional review board, biomedical
5     compendia, and other medical literature that meet the
6     criteria of the National Institutes of Health's Library of
7     Medicine for indexing in Index Medicus (Medline) and
8     Elsevier Science Ltd. for indexing in Excerpta Medicus
9     (EMBASE);
10         (3) medical journals recognized by the Secretary of
11     Health and Human Services under Section 1861(t)(2) of the
12     federal Social Security Act;
13         (4) the following standard reference compendia:
14             (a) The American Hospital Formulary Service-Drug
15         Information;
16             (b) Drug Facts and Comparisons;
17             (c) The American Dental Association Accepted
18         Dental Therapeutics; and
19             (d) The United States Pharmacopoeia-Drug
20         Information;
21         (5) findings, studies, or research conducted by or
22     under the auspices of federal government agencies and
23     nationally recognized federal research institutes,
24     including:
25             (a) the federal Agency for Healthcare Research and
26         Quality;

 

 

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1             (b) the National Institutes of Health;
2             (c) the National Cancer Institute;
3             (d) the National Academy of Sciences;
4             (e) the Centers for Medicare & Medicaid Services;
5             (f) the federal Food and Drug Administration; and
6             (g) any national board recognized by the National
7         Institutes of Health for the purpose of evaluating the
8         medical value of health care services; or
9         (6) any other medical or scientific evidence that is
10     comparable to the sources listed in items (1) through (5).
11     "Protected health information" means health information
12 (i) that identifies an individual who is the subject of the
13 information; or (ii) with respect to which there is a
14 reasonable basis to believe that the information could be used
15 to identify an individual.
16     "Retrospective review" means a review of medical necessity
17 conducted after services have been provided to a patient, but
18 does not include the review of a claim that is limited to an
19 evaluation of reimbursement levels, veracity of documentation,
20 accuracy of coding, or adjudication for payment.
21     "Utilization review" has the meaning provided by the
22 American Accreditation Health Care Commission.
23     "Utilization review organization" means a utilization
24 review program as defined by the American Accreditation Health
25 Care Commission.
 

 

 

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1     Section 15. Applicability and scope.
2     (a) Except as provided in subsection (b) of this Section,
3 this Act shall apply to all health carriers.
4     (b) The provisions of this Act shall not apply to a policy
5 or certificate that provides coverage only for a specified
6 disease, specified accident or accident-only coverage, credit,
7 dental, disability income, hospital indemnity, long-term care
8 insurance as defined by Article XIXA of the Illinois Insurance
9 Code, vision care, or any other limited supplemental benefit; a
10 Medicare supplement policy of insurance as defined by the
11 Director by regulation; coverage under a plan through Medicare,
12 Medicaid, or the federal employees health benefits program; any
13 coverage issued under Chapter 55 of Title 10, U.S. Code and any
14 coverage issued as supplement to that coverage; any coverage
15 issued as supplemental to liability insurance, workers'
16 compensation, or similar insurance; automobile medical-payment
17 insurance or any insurance under which benefits are payable
18 with or without regard to fault, whether written on a group
19 blanket or individual basis; or any managed care plan as
20 defined in the Managed Care Reform and Patient Rights Act.
 
21     Section 20. Notice of right to external review.
22     (a) At the same time the health carrier sends written
23 notice of an adverse determination upon completion of the
24 health carrier's utilization review process as provided by the
25 American Accreditation Health Care Commission and a final

 

 

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1 adverse determination, a health carrier shall notify a covered
2 person and a covered person's health care provider in writing
3 of the covered person's right to request an external review as
4 provided by this Act.
5         (1) The written notice required shall include the
6     following, or substantially equivalent, language: "We have
7     denied your request for the provision of or payment for a
8     health care service or course of treatment. You have the
9     right to have our decision reviewed by an independent
10     review organization not associated with us if our decision
11     involved making a judgment as to the medical necessity,
12     appropriateness, health care setting, level of care, or
13     effectiveness of the health care service or treatment you
14     requested by submitting a written request for an external
15     review to us. Upon receipt of your request an independent
16     review organization registered with the Department of
17     Financial and Professional Regulation, Division of
18     Insurance will be assigned to review our decision.".
19         (2) The notice shall also include the appropriate
20     statements and information set forth in subsections (b) and
21     (c) of this Section.
22     (b) The health carrier shall include in the notice required
23 under subsection (a) of this Section for a notice related to an
24 adverse determination, a statement informing the covered
25 person that:
26         (1) if the covered person has a medical condition where

 

 

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1     the timeframe for completion of an expedited internal
2     review of a grievance involving an adverse determination
3     would seriously jeopardize the life or health of the
4     covered person or would jeopardize the covered person's
5     ability to regain maximum function or if the adverse
6     determination involves a denial of coverage based on a
7     determination that the recommended or requested health
8     care service or treatment is experimental or
9     investigational and the covered person's treating
10     physician certifies in writing that the recommended or
11     requested health care service or treatment that is the
12     subject of the adverse determination would be
13     significantly less effective if not promptly initiated,
14     then the covered person or the covered person's authorized
15     representative may file a request for an expedited external
16     review at the same time the covered person or the covered
17     person's authorized representative files a request for an
18     expedited internal appeal involving an adverse
19     determination as set forth by the American Accreditation
20     Health Care Commission. The independent review
21     organization assigned to conduct the expedited external
22     review will determine whether the covered person shall be
23     required to complete the expedited review of the grievance
24     prior to conducting the expedited external review; and
25         (2) the covered person or the covered person's
26     authorized representative may file a grievance under the

 

 

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1     health carrier's internal grievance process as set forth by
2     the American Accreditation Health Care Commission, but if
3     the health carrier has not issued a written decision to the
4     covered person or the covered person's authorized
5     representative within 30 days following the date the
6     covered person or the covered person's authorized
7     representative files the grievance with the health carrier
8     and the covered person or the covered person's authorized
9     representative has not requested or agreed to a delay, then
10     the covered person or the covered person's authorized
11     representative may file a request for external review and
12     shall be considered to have exhausted the health carrier's
13     internal grievance process.
14     (c) The health carrier shall include in the notice required
15 under subsection (a) of this Section for a notice related to a
16 final adverse determination, a statement informing the covered
17 person that:
18         (1) if the covered person has a medical condition where
19     the timeframe for completion of a standard external review
20     would seriously jeopardize the life or health of the
21     covered person or would jeopardize the covered person's
22     ability to regain maximum function, then the covered person
23     or the covered person's authorized representative may file
24     a request for an expedited external review; or
25         (2) if a final adverse determination concerns:
26             (i) an admission, availability of care, continued

 

 

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1         stay, or health care service for which the covered
2         person received emergency services, but has not been
3         discharged from a facility, then the covered person, or
4         the covered person's authorized representative, may
5         request an expedited external review; or
6             (ii) a denial of coverage based on a determination
7         that the recommended or requested health care service
8         or treatment is experimental or investigational, and
9         the covered person's health care provider certifies in
10         writing that the recommended or requested health care
11         service or treatment that is the subject of the request
12         would be significantly less effective if not promptly
13         initiated, then the covered person or the covered
14         person's authorized representative may request an
15         expedited external review.
16     (d) In addition to the information to be provided pursuant
17 to subsections (a), (b), and (c) of this Section, the health
18 carrier shall include a copy of the description of both the
19 required standard and expedited external review procedures.
20 The description shall highlight the external review procedures
21 that give the covered person or the covered person's authorized
22 representative the opportunity to submit additional
23 information, including any forms used to process an external
24 review.
 
25     Section 25. Request for external review. A covered person

 

 

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1 or the covered person's authorized representative may make a
2 request for a standard external or expedited external review of
3 an adverse determination or final adverse determination.
4 Requests under this Section shall be made directly to the
5 health carrier that made the adverse or final adverse
6 determination. All requests for external review shall be in
7 writing except for requests for expedited external reviews
8 which may me made orally. Health carriers must provide covered
9 persons with forms to request external reviews.
 
10     Section 30. Exhaustion of internal grievance process.
11     (a) Except as provided in item (1) of subsection (b) of
12 Section 20 of this Act, a request for an external review shall
13 not be made until the covered person has exhausted the health
14 carrier's internal grievance process as set forth by the
15 American Accreditation Health Care Commission.
16     (b) A covered person shall be considered to have exhausted
17 the health carrier's internal grievance process for purposes of
18 this Section if the covered person or the covered person's
19 authorized representative filed a request for an internal
20 review of an adverse determination pursuant to the American
21 Accreditation Health Care Commission and has not received a
22 written decision on the request from the health carrier within
23 30 days after the request is filed, except to the extent the
24 covered person or the covered person's authorized
25 representative requested or agreed to a delay.

 

 

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1     (c) Notwithstanding subsection (b) of this Section, a
2 covered person or the covered person's authorized
3 representative may not make a request for an external review of
4 an adverse determination involving a retrospective review
5 determination until the covered person has exhausted the health
6 carrier's internal grievance process.
7     (d) Upon request for an expedited external review pursuant
8 to item (1) of subsection (b) of Section 20 of this Act, the
9 independent review organization conducting the external review
10 shall determine whether the covered person shall be required to
11 complete the expedited review process set forth by the American
12 Accreditation Health Care Commission before it conducts the
13 expedited external review. Upon determination that the covered
14 person must first complete the expedited grievance review
15 process, the independent review organization immediately shall
16 notify the covered person and, if applicable, the covered
17 person's authorized representative of this determination and
18 that it will not proceed with the expedited external review
19 until completion of the expedited grievance review process and
20 that covered person's grievance at the completion of the
21 expedited grievance review process remains unresolved.
22     (e) A covered person need not exhaust a health carrier's
23 internal grievance procedures as set forth by the American
24 Accreditation Health Care Commission, if the health carrier
25 agrees to waive the exhaustion requirement.
 

 

 

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1     Section 35. Standard external review.
2     (a) Within 4 months after the date of receipt of a notice
3 of an adverse determination or final adverse determination, a
4 covered person or the covered person's authorized
5 representative may file a request for an external review with
6 the health carrier.
7     (b) Within 5 business days following the date of receipt of
8 the external review request, the health carrier shall complete
9 a preliminary review of the request to determine whether:
10         (1) the individual is or was a covered person in the
11     health benefit plan at the time the health care service was
12     requested or at the time the health care service was
13     provided;
14         (2) either of the following situations is applicable:
15             (A) the health care service that is the subject of
16         the adverse determination or the final adverse
17         determination is a covered service under the covered
18         person's health benefit plan, but the health carrier
19         has determined that the health care service is not
20         covered because it does not meet the health carrier's
21         requirements for medical necessity, appropriateness,
22         health care setting, level of care, or effectiveness;
23         or
24             (B) the recommended or requested health care
25         service or treatment that is the subject of the adverse
26         determination or final adverse determination is a

 

 

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1         covered benefit under the covered person's health
2         benefit plan except for the health carrier's
3         determination that the service or treatment is
4         experimental or investigational for a particular
5         medical condition and is not explicitly listed as an
6         excluded benefit under the covered person's health
7         benefit plan with the health carrier;
8         (3) the covered person's treating physician has
9     certified that one of the following situations is
10     applicable:
11             (A) standard health care services or treatments
12         have not been effective in improving the condition of
13         the covered person;
14             (B) standard health care services or treatments
15         are not medically appropriate for the covered person;
16         or
17             (C) there is no available standard health care
18         service or treatment covered by the health carrier that
19         is more beneficial than the recommended or requested
20         health care service or treatment described in item (4)
21         of this subsection (b);
22         (4) the covered person's treating physician:
23             (A) has recommended a health care service or
24         treatment that the physician certifies, in writing, is
25         likely to be more beneficial to the covered person, in
26         the physician's opinion, than any available standard

 

 

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1         health care service or treatment; or
2             (B) who is a licensed, board certified, or board
3         eligible physician qualified to practice in the area of
4         medicine appropriate to treat the covered person's
5         condition, has certified in writing that
6         scientifically valid studies using accepted protocols
7         demonstrate that the health care service or treatment
8         requested by the covered person that is the subject of
9         the adverse determination or final adverse
10         determination is likely to be more beneficial to the
11         covered person than any available standard health care
12         services or treatments;
13         (5) the covered person has exhausted the health
14     carrier's internal grievance process as set forth in
15     Section 30 of this Act; and
16         (6) the covered person has provided all the information
17     and forms required to process an external review as
18     specified in this Act.
19     (c) Within one business day after completion of the
20 preliminary review, the health carrier shall notify the covered
21 person and, if applicable, the covered person's authorized
22 representative in writing whether the request is complete and
23 eligible for external review. If the request:
24         (1) is not complete, the health carrier shall inform
25     the covered person and, if applicable, the covered person's
26     authorized representative in writing and include in the

 

 

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1     notice what information or materials are required by this
2     Act to make the request complete; or
3         (2) is not eligible for external review, the health
4     carrier shall inform the covered person and, if applicable,
5     the covered person's authorized representative in writing
6     and include in the notice the reasons for its
7     ineligibility.
8     The notice of initial determination of ineligibility shall
9 include a statement informing the covered person and, if
10 applicable, the covered person's authorized representative
11 that a health carrier's initial determination that the external
12 review request is ineligible for review may be appealed to the
13 Director by filing a complaint with the Director.
14     Notwithstanding a health carrier's initial determination
15 that the request is ineligible for external review, the
16 Director may determine that a request is eligible for external
17 review and require that it be referred for external review. In
18 making such determination, the Director's decision shall be in
19 accordance with the terms of the covered person's health
20 benefit plan and shall be subject to all applicable provisions
21 of this Act.
22     (d) Whenever a request is eligible for external review the
23 health carrier shall, within 5 business days:
24         (1) assign an independent review organization from the
25     list of approved independent review organizations compiled
26     and maintained by the Director; and

 

 

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1         (2) notify in writing the covered person and, if
2     applicable, the covered person's authorized representative
3     of the request's eligibility and acceptance for external
4     review and the name of the independent review organization.
5     The health carrier shall include in the notice provided to
6 the covered person and, if applicable, the covered person's
7 authorized representative a statement that the covered person
8 or the covered person's authorized representative may, within 5
9 business days following the date of receipt of the notice
10 provided pursuant to item (2) of this subsection (d), submit in
11 writing to the assigned independent review organization
12 additional information that the independent review
13 organization shall consider when conducting the external
14 review. The independent review organization is not required to,
15 but may, accept and consider additional information submitted
16 after 5 business days.
17     (e) The assignment of an approved independent review
18 organization to conduct an external review in accordance with
19 this Section shall be done on a random basis among those
20 approved independent review organizations qualified to conduct
21 external review except for instances of conflict of interest
22 concerns pursuant to this Act.
23     (f) Upon assignment of an independent review organization,
24 the health carrier or its designee utilization review
25 organization shall, within 5 business days, provide to the
26 assigned independent review organization the documents and any

 

 

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1 information considered in making the adverse determination or
2 final adverse determination; in such cases, the following
3 provisions shall apply:
4         (1) Except as provided in item (2) of this subsection
5     (f), failure by the health carrier or its utilization
6     review organization to provide the documents and
7     information within the specified time frame shall not delay
8     the conduct of the external review.
9         (2) If the health carrier or its utilization review
10     organization fails to provide the documents and
11     information within the specified time frame, the assigned
12     independent review organization may terminate the external
13     review and make a decision to reverse the adverse
14     determination or final adverse determination.
15         (3) Within one business day after making the decision
16     to terminate the external review and make a decision to
17     reverse the adverse determination or final adverse
18     determination under item (2) of this subsection (f), the
19     independent review organization shall notify the health
20     carrier, the covered person and, if applicable, the covered
21     person's authorized representative, of its decision to
22     reverse the adverse determination.
23     (g) Upon receipt of the information from the health carrier
24 or its utilization review organization, the assigned
25 independent review organization shall review all of the
26 information and documents and any other information submitted

 

 

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1 in writing to the independent review organization by the
2 covered person and the covered person's authorized
3 representative.
4     (h) Upon receipt of any information submitted by the
5 covered person or the covered person's authorized
6 representative, the independent review organization shall
7 forward the information to the health carrier within 1 business
8 day.
9         (1) Upon receipt of the information, if any, the health
10     carrier may reconsider its adverse determination or final
11     adverse determination that is the subject of the external
12     review.
13         (2) Reconsideration by the health carrier of its
14     adverse determination or final adverse determination shall
15     not delay or terminate the external review.
16         (3) The external review may only be terminated if the
17     health carrier decides, upon completion of its
18     reconsideration, to reverse its adverse determination or
19     final adverse determination and provide coverage or
20     payment for the health care service that is the subject of
21     the adverse determination or final adverse determination.
22     In such cases, the following provisions shall apply:
23             (A) Within one business day after making the
24         decision to reverse its adverse determination or final
25         adverse determination, the health carrier shall notify
26         the covered person, if applicable, the covered

 

 

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1         person's authorized representative, and the assigned
2         independent review organization in writing of its
3         decision.
4             (B) Upon notice from the health carrier that the
5         health carrier has made a decision to reverse its
6         adverse determination or final adverse determination,
7         the assigned independent review organization shall
8         terminate the external review.
9     (i) In addition to the documents and information provided
10 by the health carrier or its utilization review organization
11 and the covered person and the covered person's authorized
12 representative, if any, the independent review organization,
13 to the extent the information or documents are available and
14 the independent review organization considers them
15 appropriate, shall consider the following in reaching a
16 decision:
17         (1) for an adverse determination or final adverse
18     determination:
19             (A) the covered person's pertinent medical
20         records;
21             (B) the covered person's health care provider's
22         recommendation;
23             (C) consulting reports from appropriate health
24         care providers and other documents submitted by the
25         health carrier, the covered person, the covered
26         person's authorized representative, or the covered

 

 

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1         person's treating provider;
2             (D) the terms of coverage under the covered
3         person's health benefit plan with the health carrier to
4         ensure that the independent review organization's
5         decision is not contrary to the terms of coverage under
6         the covered person's health benefit plan with the
7         health carrier;
8             (E) the most appropriate practice guidelines,
9         which shall include applicable evidence-based
10         standards and may include any other practice
11         guidelines developed by the federal government,
12         national or professional medical societies, boards,
13         and associations;
14             (F) any applicable clinical review criteria
15         developed and used by the health carrier or its
16         designee utilization review organization; and
17             (G) the opinion of the independent review
18         organization's clinical reviewer or reviewers after
19         considering paragraphs (A) through (G) of this item (1)
20         of this subsection (i) to the extent the information or
21         documents are available and the clinical reviewer or
22         reviewers considers the information or documents
23         appropriate;
24         (2) for an adverse determination or final adverse
25     determination that involves a denial of coverage based on a
26     determination that the health care service or treatment

 

 

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1     recommended or requested is experimental or
2     investigational:
3             (A) the covered person's pertinent medical
4         records;
5             (B) the covered person's health care provider's
6         recommendation;
7             (C) consulting reports from appropriate health
8         care providers and other documents submitted by the
9         health carrier, the covered person, the covered
10         person's authorized representative, or the covered
11         person's treating physician or health care
12         professional;
13             (D) the terms of coverage under the covered
14         person's health benefit plan with the health carrier to
15         ensure that, but for the health carrier's
16         determination that the recommended or requested health
17         care service or treatment that is the subject of the
18         opinion is experimental or investigational, the
19         independent review organization's opinion is not
20         contrary to the terms of coverage under the covered
21         person's health benefit plan with the health carrier;
22         and
23             (E) whether and to what extent:
24                 (i) the recommended or requested health care
25             service or treatment has been approved by the
26             federal Food and Drug Administration, if

 

 

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1             applicable, for the condition; or
2                 (ii) medical or scientific evidence or
3             evidence-based standards demonstrate that the
4             expected benefits of the recommended or requested
5             health care service or treatment is more likely
6             than not to be beneficial to the covered person
7             than any available standard health care service or
8             treatment and the adverse risks of the recommended
9             or requested health care service or treatment
10             would not be substantially increased over those of
11             available standard health care services or
12             treatments; or
13         (3) except for an expedited external review, for an
14     adverse determination or final adverse determination that
15     involves a denial of coverage based on a determination that
16     the health care service or treatment recommended or
17     requested is experimental or investigational, each
18     clinical reviewer selected by the independent review
19     organization shall provide its opinion to the independent
20     review organization in writing and include the following
21     information:
22             (A) a description of the covered person's medical
23         condition;
24             (B) a description of the indicators relevant to
25         determining whether there is sufficient evidence to
26         demonstrate that the recommended or requested health

 

 

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1         care service or treatment is more likely than not to be
2         beneficial to the covered person than any available
3         standard health care services or treatments and the
4         adverse risks of the recommended or requested health
5         care service or treatment would not be substantially
6         increased over those of available standard health care
7         services or treatments;
8             (C) a description and analysis of any medical or
9         scientific evidence considered in reaching the
10         opinion;
11             (D) a description and analysis of any
12         evidence-based standard; and
13             (E) information on whether the reviewer's
14         rationale for the opinion is based on paragraphs (i) or
15         (ii) of subitem (E) of item (2) of this subsection (i).
16     (j) Within 5 days after the date of receipt of all
17 necessary information, the assigned independent review
18 organization shall provide written notice of its decision to
19 uphold or reverse the adverse determination or the final
20 adverse determination to the health carrier, the covered person
21 and, if applicable, the covered person's authorized
22 representative. In reaching a decision, the assigned
23 independent review organization is not bound by any decisions
24 or conclusions reached during the health carrier's utilization
25 review process as set forth by the American Accreditation
26 Health Care Commission. In such cases, the following provisions

 

 

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1 shall apply:
2         (1) The independent review organization shall include
3     in the notice:
4             (A) a general description of the reason for the
5         request for external review;
6             (B) the date the independent review organization
7         received the assignment from the health carrier to
8         conduct the external review;
9             (C) the time period during which the external
10         review was conducted;
11             (D) references to the evidence or documentation,
12         including the evidence-based standards, considered in
13         reaching its decision.
14             (E) the date of its decision; and
15             (F) the principal reason or reasons for its
16         decision, including what applicable, if any,
17         evidence-based standards that were a basis for its
18         decision.
19         (2) For reviews of experimental or investigational
20     treatments, the notice shall include the following
21     information:
22             (A) a general description of the reason for the
23         request for external review;
24             (B) the written opinion of each clinical reviewer,
25         including the recommendation of each clinical reviewer
26         as to whether the recommended or requested health care

 

 

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1         service or treatment should be covered and the
2         rationale for the reviewer's recommendation;
3             (C) the date that the independent review
4         organization received assignment from the health
5         carrier to conduct the external review;
6             (D) the time period during which the external
7         review was conducted; and
8             (E) the principal reason or reasons for its
9         decision.
10         (3) Upon receipt of a notice of a decision reversing
11     the adverse determination or final adverse determination,
12     the health carrier immediately shall approve the coverage
13     that was the subject of the adverse determination or final
14     adverse determination.
 
15     Section 40. Expedited external review.
16     (a) A covered person or a covered person's authorized
17 representative may file a request for an expedited external
18 review with the health carrier either orally or in writing at
19 the time the covered person receives:
20         (1) an adverse determination, if:
21             (A) the adverse determination involves a medical
22         condition of the covered person for which the timeframe
23         for completion of an expedited internal review of a
24         grievance involving an adverse determination as set
25         forth by the American Accreditation Health Care

 

 

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1         Commission would seriously jeopardize the life or
2         health of the covered person or would jeopardize the
3         covered person's ability to regain maximum function;
4         and
5             (B) the covered person or the covered person's
6         authorized representative has filed a request for an
7         expedited review of a grievance involving an adverse
8         determination as set forth by the American
9         Accreditation Health Care Commission; or
10         (2) a final adverse determination, if:
11             (A) the covered person has a medical condition
12         where the timeframe for completion of a standard
13         external review would seriously jeopardize the life or
14         health of the covered person or would jeopardize the
15         covered person's ability to regain maximum function;
16         or
17             (B) the final adverse determination concerns an
18         admission, availability of care, continued stay, or
19         health care service for which the covered person
20         received emergency services but has not been
21         discharged from a facility.
22     (b) Upon receipt of a request for an expedited external
23 review as provided in Section 20 of this Act, the health
24 carrier shall determine whether the request meets the
25 reviewability requirements set forth in subsection (b) of
26 Section 35 of this Act. The health carrier shall immediately

 

 

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1 notify the covered person and, if applicable, the covered
2 person's authorized representative of its eligibility
3 determination. The notice of initial determination shall
4 include a statement informing the covered person and, if
5 applicable, the covered person's authorized representative
6 that a health carrier's initial determination that an external
7 review request is ineligible for review may be appealed to the
8 Director.
9     (c) The Director may determine that a request is eligible
10 for external review under subsection (b) of Section 35 of this
11 Act, notwithstanding a health carrier's initial determination
12 that the request is ineligible and require that it be referred
13 for external review. In making a determination, the Director's
14 decision shall be made in accordance with the terms of the
15 covered person's health benefit plan and shall be subject to
16 all applicable provisions of this Act.
17     (d) Whenever a request is eligible for external review, the
18 health carrier shall immediately assign an independent review
19 organization from the list of approved independent review
20 organizations compiled and maintained by the Director to
21 conduct the expedited review. In such cases, the following
22 provisions shall apply:
23         (1) The assignment by the health carrier of an approved
24     independent review organization to conduct an external
25     review in accordance with this Section shall be done on a
26     random basis among those approved independent review

 

 

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1     organizations except as may be prohibited by conflict of
2     interest concerns pursuant to Section 60 of this Act.
3         (2) Immediately upon assigning an independent review
4     organization to perform an expedited external review, but
5     in no case less than 24 hours after assigning the
6     independent review organization, the health carrier or its
7     designee utilization review organization shall provide or
8     transmit all necessary documents and information
9     considered in making the final adverse determination to the
10     assigned independent review organization electronically or
11     by telephone or facsimile or any other available
12     expeditious method.
13         (3) If the health carrier or its utilization review
14     organization fails to provide the documents and
15     information within the specified timeframe, the assigned
16     independent review organization may terminate the external
17     review and make a decision to reverse the adverse
18     determination or final adverse determination.
19         (4) Within one business day after making the decision
20     to terminate the external review and make a decision to
21     reverse the adverse determination or final adverse
22     determination under item (2) of this subsection (d), the
23     independent review organization shall notify the health
24     carrier, the covered person and, if applicable, the covered
25     person's authorized representative of its decision to
26     reverse the adverse determination.

 

 

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1     (e) In addition to the documents and information provided
2 by the health carrier or its utilization review organization
3 and any documents and information provided by the covered
4 person and the covered person's authorized representative, the
5 independent review organization shall consider the following
6 in reaching a decision:
7         (1) for an adverse determination or final adverse
8     determination, the provisions included in subitems (A)
9     through (G) of item (1) of subsection (i) of Section 35 of
10     this Act; or
11         (2) for an adverse determination or final adverse
12     determination that involves a denial of coverage based on a
13     determination that the health care service or treatment
14     recommended or requested is experimental or
15     investigational, the provisions included in subitems (A)
16     through (E) of item (2) of subsection (i) of Section 35 of
17     this Act.
18     (f) As expeditiously as the covered person's medical
19 condition or circumstances requires, but in no event more than
20 72 hours after the receipt of all pertinent information, the
21 assigned independent review organization shall:
22         (1) make a decision to uphold or reverse the final
23     adverse determination; and
24         (2) notify the health carrier, the covered person, the
25     covered person's health care provider, and if applicable,
26     the covered person's authorized representative, of the

 

 

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1     decision.
2     (g) In reaching a decision, the assigned independent review
3 organization is not bound by any decisions or conclusions
4 reached during the health carrier's utilization review process
5 or the health carrier's internal grievance process as set forth
6 by the American Accreditation Health Care Commission.
7     (h) Upon receipt of notice of a decision reversing the
8 final adverse determination, the health carrier shall
9 immediately approve the coverage that was the subject of the
10 final adverse determination. Within 48 hours after the date of
11 providing the notice required in this subsection (h), the
12 assigned independent review organization shall provide written
13 confirmation of the decision to the health carrier, the covered
14 person, and if applicable, the covered person's authorized
15 representative including the information set forth in
16 subsection (j) of Section 35 of this Act as applicable.
17     (i) An expedited external review may not be provided for
18 retrospective adverse or final adverse determinations.
 
19     Section 45. Binding nature of external review decision. An
20 external review decision is binding on the health carrier. An
21 external review decision is binding on the covered person
22 except to the extent the covered person has other remedies
23 available under applicable federal or State law. A covered
24 person or the covered person's authorized representative may
25 not file a subsequent request for external review involving the

 

 

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1 same adverse determination or final adverse determination for
2 which the covered person has already received an external
3 review decision pursuant to this Act.
 
4     Section 50. Approval of independent review organizations.
5     (a) The Director shall approve independent review
6 organizations eligible to be assigned to conduct external
7 reviews under this Act.
8     (b) In order to be eligible for approval by the Director
9 under this Section to conduct external reviews under this Act
10 an independent review organization:
11         (1) except as otherwise provided in this Section, shall
12     be accredited by a nationally recognized private
13     accrediting entity that the Director has determined has
14     independent review organization accreditation standards
15     that are equivalent to or exceed the minimum qualifications
16     for independent review; and
17         (2) shall submit an application for approval in
18     accordance with subsection (d) of this Section.
19     (c) The Director shall develop an application form for
20 initially approving and for reapproving independent review
21 organizations to conduct external reviews.
22     (d) Any independent review organization wishing to be
23 approved to conduct external reviews under this Act shall
24 submit the application form and include with the form all
25 documentation and information necessary for the Director to

 

 

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1 determine if the independent review organization satisfies the
2 minimum qualifications established under this Act. The
3 Director may:
4         (1) approve independent review organizations that are
5     not accredited by a nationally recognized private
6     accrediting entity if there are no acceptable nationally
7     recognized private accrediting entities providing
8     independent review organization accreditation; and
9         (2) by rule establish an application fee that
10     independent review organizations shall submit to the
11     Director with an application for approval and renewing.
12     (e) An approval is effective for 2 years, unless the
13 Director determines before its expiration that the independent
14 review organization is not satisfying the minimum
15 qualifications established under this Act.
16     (f) Whenever the Director determines that an independent
17 review organization has lost its accreditation or no longer
18 satisfies the minimum requirements established under this Act,
19 the Director shall terminate the approval of the independent
20 review organization and remove the independent review
21 organization from the list of independent review organizations
22 approved to conduct external reviews under this Act that is
23 maintained by the Director.
24     (g) The Director shall maintain and periodically update a
25 list of approved independent review organizations.
26     (h) The Director may promulgate regulations to carry out

 

 

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1 the provisions of this Section.
 
2     Section 55. Minimum qualifications for independent review
3 organizations.
4     (a) To be approved to conduct external reviews, an
5 independent review organization shall have and maintain
6 written policies and procedures that govern all aspects of both
7 the standard external review process and the expedited external
8 review process set forth in this Act that include, at a
9 minimum:
10         (1) a quality assurance mechanism that ensures that:
11             (A) external reviews are conducted within the
12         specified timeframes and required notices are provided
13         in a timely manner;
14             (B) selection of qualified and impartial clinical
15         reviewers to conduct external reviews on behalf of the
16         independent review organization and suitable matching
17         of reviewers to specific cases and that the independent
18         review organization employs or contracts with an
19         adequate number of clinical reviewers to meet this
20         objective;
21             (C) the health carrier, the covered person, and the
22         covered person's authorized representative shall not
23         choose or control the choice of the physicians or other
24         health care professionals to be selected to conduct the
25         external review;

 

 

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1             (D) confidentiality of medical and treatment
2         records and clinical review criteria; and
3             (E) any person employed by or under contract with
4         the independent review organization adheres to the
5         requirements of this Act;
6         (2) a toll-free telephone service operating on a
7     24-hour-day, 7-day-a-week basis that accepts, receives,
8     and records information related to external reviews and
9     provides appropriate instructions; and
10         (3) an agreement to maintain and provide to the
11     Director the information set out in Section 70 of this Act.
12     (b) All clinical reviewers assigned by an independent
13 review organization to conduct external reviews shall be
14 physicians or other appropriate health care providers who meet
15 the following minimum qualifications:
16         (1) be an expert in the treatment of the covered
17     person's medical condition that is the subject of the
18     external review;
19         (2) be knowledgeable about the recommended health care
20     service or treatment through recent or current actual
21     clinical experience treating patients with the same or
22     similar medical condition of the covered person;
23         (3) hold a non-restricted license in a state of the
24     United States and, for physicians, a current certification
25     by a recognized American medical specialty board in the
26     area or areas appropriate to the subject of the external

 

 

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1     review;
2         (4) have no history of disciplinary actions or
3     sanctions, including loss of staff privileges or
4     participation restrictions, that have been taken or are
5     pending by any hospital, governmental agency or unit, or
6     regulatory body that raise a substantial question as to the
7     clinical reviewer's physical, mental, or professional
8     competence or moral character; and
9         (5) for purposes of conducting an external review of
10     experimental or investigational treatment adverse
11     determinations, through clinical experience in the past 3
12     years, be an expert in the treatment of the covered
13     person's condition and knowledgeable about the recommended
14     or requested health care service or treatment; neither the
15     covered person, the covered person's authorized
16     representative, if applicable, nor the health carrier
17     shall choose or control the choice of the physicians or
18     other health care professionals selected to conduct the
19     external review.
20     (c) In addition to the requirements set forth in subsection
21 (a), an independent review organization may not own or control,
22 be a subsidiary of, or in any way be owned, or controlled by,
23 or exercise control with a health benefit plan, a national,
24 State, or local trade association of health benefit plans, or a
25 national, State, or local trade association of health care
26 providers.

 

 

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1     (d) Conflicts of interest prohibited. In addition to the
2 requirements set forth in subsections (a), (b), and (c) of this
3 Section, to be approved pursuant to this Act to conduct an
4 external review of a specified case, neither the independent
5 review organization selected to conduct the external review nor
6 any clinical reviewer assigned by the independent organization
7 to conduct the external review may have a material
8 professional, familial or financial conflict of interest with
9 any of the following:
10         (1) the health carrier that is the subject of the
11     external review;
12         (2) the covered person whose treatment is the subject
13     of the external review or the covered person's authorized
14     representative;
15         (3) any officer, director or management employee of the
16     health carrier that is the subject of the external review;
17         (4) the health care provider, the health care
18     provider's medical group or independent practice
19     association recommending the health care service or
20     treatment that is the subject of the external review;
21         (5) the facility at which the recommended health care
22     service or treatment would be provided; or
23         (6) the developer or manufacturer of the principal
24     drug, device, procedure, or other therapy being
25     recommended for the covered person whose treatment is the
26     subject of the external review.

 

 

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1     (e) An independent review organization that is accredited
2 by a nationally recognized private accrediting entity that has
3 independent review accreditation standards that the Director
4 has determined are equivalent to or exceed the minimum
5 qualifications of this Section shall be presumed to be in
6 compliance with this Section and shall be eligible for approval
7 under this Section.
8     (f) An independent review organization shall be unbiased.
9 An independent review organization shall establish and
10 maintain written procedures to ensure that it is unbiased in
11 addition to any other procedures required under this Section.
 
12     Section 60. Hold harmless for independent review
13 organizations. No independent review organization or clinical
14 reviewer working on behalf of an independent review
15 organization or an employee, agent or contractor of an
16 independent review organization shall be liable for damages to
17 any person for any opinions rendered or acts or omissions
18 performed within the scope of the organization's or person's
19 duties under the law during or upon completion of an external
20 review conducted pursuant to this Act, unless the opinion was
21 rendered or act or omission performed in bad faith or involved
22 gross negligence.
 
23     Section 65. External review reporting requirements.
24     (a) Each health carrier shall maintain written records in

 

 

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1 the aggregate on all requests for external review for each
2 calendar year and submit a report to the Director in the format
3 specified by the Director by March 1 of each year.
4     (b) The report shall include in the aggregate:
5         (1) the total number of requests for external review;
6         (2) the total number of requests for expedited external
7     review;
8         (3) the total number of requests for external review
9     denied;
10         (4) the number of requests for external review
11     resolved, including:
12             (A) the number of requests for external review
13         resolved upholding the adverse determination or final
14         adverse determination;
15             (B) the number of requests for external review
16         resolved reversing the adverse determination or final
17         adverse determination;
18             (C) the number of requests for expedited external
19         review resolved upholding the adverse determination or
20         final adverse determination; and
21             (D) the number of requests for expedited external
22         review resolved reversing the adverse determination or
23         final adverse determination;
24         (5) the average length of time for resolution for an
25     external review;
26         (6) the average length of time for resolution for an

 

 

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1     expedited external review;
2         (7) a summary of the types of coverages or cases for
3     which an external review was sought, as specified below:
4             (A) denial of care or treatment (dissatisfaction
5         regarding prospective non-authorization of a request
6         for care or treatment recommended by a provider
7         excluding diagnostic procedures and referral requests;
8         partial approvals and care terminations are also
9         considered to be denials);
10             (B) denial of diagnostic procedure
11         (dissatisfaction regarding prospective
12         non-authorization of a request for a diagnostic
13         procedure recommended by a provider; partial approvals
14         are also considered to be denials);
15             (C) denial of referral request (dissatisfaction
16         regarding non-authorization of a request for a
17         referral to another provider recommended by a PCP);
18             (D) claims and utilization review (dissatisfaction
19         regarding the concurrent or retrospective evaluation
20         of the coverage, medical necessity, efficiency or
21         appropriateness of health care services or treatment
22         plans; prospective "Denials of care or treatment",
23         "Denials of diagnostic procedures" and "Denials of
24         referral requests" should not be classified in this
25         category, but the appropriate one above);
26         (8) the number of external reviews that were terminated

 

 

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1     as the result of a reconsideration by the health carrier of
2     its adverse determination or final adverse determination
3     after the receipt of additional information from the
4     covered person or the covered person's authorized
5     representative; and
6         (9) any other information the Director may request or
7     require.
 
8     Section 70. Funding of external review. The health carrier
9 shall be solely responsible for paying the cost of external
10 reviews conducted by independent review organizations.
 
11     Section 75. Disclosure requirements.
12     (a) Each health carrier shall include a description of the
13 external review procedures in, or attached to, the policy,
14 certificate, membership booklet, and outline of coverage or
15 other evidence of coverage it provides to covered persons.
16     (b) The description required under subsection (a) of this
17 Section shall include a statement that informs the covered
18 person of the right of the covered person to file a request for
19 an external review of an adverse determination or final adverse
20 determination with the health carrier. The statement shall
21 explain that external review is available when the adverse
22 determination or final adverse determination involves an issue
23 of medical necessity, appropriateness, health care setting,
24 level of care, or effectiveness. The statement shall include

 

 

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1 the toll-free telephone number and address of the Office of
2 Consumer Health Insurance within the Division of Insurance.
 
3     Section 97. Severability. The provisions of this Act are
4 severable under Section 1.31 of the Statute on Statutes.
 
5     Section 99. Effective date. This Act takes effect January
6 1, 2010.