Illinois General Assembly - Full Text of HB4125
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Full Text of HB4125  94th General Assembly



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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 5. The Illinois Insurance Code is amended by
5 changing Section 370c as follows:
6     (215 ILCS 5/370c)  (from Ch. 73, par. 982c)
7     Sec. 370c. Mental and emotional disorders.
8     (a) (1) On and after the effective date of this Section,
9 every insurer which delivers, issues for delivery or renews or
10 modifies group A&H policies providing coverage for hospital or
11 medical treatment or services for illness on an
12 expense-incurred basis shall offer to the applicant or group
13 policyholder subject to the insurers standards of
14 insurability, coverage for reasonable and necessary treatment
15 and services for mental, emotional or nervous disorders or
16 conditions, other than serious mental illnesses as defined in
17 item (2) of subsection (b), up to the limits provided in the
18 policy for other disorders or conditions, except (i) the
19 insured may be required to pay up to 50% of expenses incurred
20 as a result of the treatment or services, and (ii) the annual
21 benefit limit may be limited to the lesser of $10,000 or 25% of
22 the lifetime policy limit.
23     (2) Each insured that is covered for mental, emotional or
24 nervous disorders or conditions shall be free to select the
25 physician licensed to practice medicine in all its branches,
26 licensed clinical psychologist, licensed clinical social
27 worker, or licensed clinical professional counselor of his
28 choice to treat such disorders, and the insurer shall pay the
29 covered charges of such physician licensed to practice medicine
30 in all its branches, licensed clinical psychologist, licensed
31 clinical social worker, or licensed clinical professional
32 counselor up to the limits of coverage, provided (i) the



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1 disorder or condition treated is covered by the policy, and
2 (ii) the physician, licensed psychologist, licensed clinical
3 social worker, or licensed clinical professional counselor is
4 authorized to provide said services under the statutes of this
5 State and in accordance with accepted principles of his
6 profession.
7     (3) Insofar as this Section applies solely to licensed
8 clinical social workers and licensed clinical professional
9 counselors, those persons who may provide services to
10 individuals shall do so after the licensed clinical social
11 worker or licensed clinical professional counselor has
12 informed the patient of the desirability of the patient
13 conferring with the patient's primary care physician and the
14 licensed clinical social worker or licensed clinical
15 professional counselor has provided written notification to
16 the patient's primary care physician, if any, that services are
17 being provided to the patient. That notification may, however,
18 be waived by the patient on a written form. Those forms shall
19 be retained by the licensed clinical social worker or licensed
20 clinical professional counselor for a period of not less than 5
21 years.
22     (b) (1) An insurer that provides coverage for hospital or
23 medical expenses under a group policy of accident and health
24 insurance or health care plan amended, delivered, issued, or
25 renewed after the effective date of this amendatory Act of the
26 92nd General Assembly shall provide coverage under the policy
27 for treatment of serious mental illness under the same terms
28 and conditions as coverage for hospital or medical expenses
29 related to other illnesses and diseases. The coverage required
30 under this Section must provide for same durational limits,
31 amount limits, deductibles, and co-insurance requirements for
32 serious mental illness as are provided for other illnesses and
33 diseases. This subsection does not apply to coverage provided
34 to employees by employers who have 50 or fewer employees.
35     (2) "Serious mental illness" means the following
36 psychiatric illnesses as defined in the most current edition of



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1 the Diagnostic and Statistical Manual (DSM) published by the
2 American Psychiatric Association:
3         (A) schizophrenia;
4         (B) paranoid and other psychotic disorders;
5         (C) bipolar disorders (hypomanic, manic, depressive,
6     and mixed);
7         (D) major depressive disorders (single episode or
8     recurrent);
9         (E) schizoaffective disorders (bipolar or depressive);
10         (F) pervasive developmental disorders;
11         (G) obsessive-compulsive disorders;
12         (H) depression in childhood and adolescence;
13         (I) panic disorder; and
14         (J) post-traumatic stress disorders (acute, chronic,
15     or with delayed onset).
16     (3) Upon request of the reimbursing insurer, a provider of
17 treatment of serious mental illness shall furnish medical
18 records or other necessary data that substantiate that initial
19 or continued treatment is at all times medically necessary. An
20 insurer shall provide a mechanism for the timely review by a
21 provider holding the same license and practicing in the same
22 specialty as the patient's provider, who is unaffiliated with
23 the insurer, jointly selected by the patient (or the patient's
24 next of kin or legal representative if the patient is unable to
25 act for himself or herself), the patient's provider, and the
26 insurer in the event of a dispute between the insurer and
27 patient's provider regarding the medical necessity of a
28 treatment proposed by a patient's provider. If the reviewing
29 provider determines the treatment to be medically necessary,
30 the insurer shall provide reimbursement for the treatment.
31 Future contractual or employment actions by the insurer
32 regarding the patient's provider may not be based on the
33 provider's participation in this procedure. Nothing prevents
34 the insured from agreeing in writing to continue treatment at
35 his or her expense. When making a determination of the medical
36 necessity for a treatment modality for serous mental illness,



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1 an insurer must make the determination in a manner that is
2 consistent with the manner used to make that determination with
3 respect to other diseases or illnesses covered under the
4 policy, including an appeals process.
5     (4) A group health benefit plan:
6         (A) shall provide coverage based upon medical
7     necessity for the following treatment of mental illness in
8     each calendar year: ;
9             (i) 45 days of inpatient treatment; and
10             (ii) 35 visits for outpatient treatment including
11         group and individual outpatient treatment; and
12             (iii) for plans or policies delivered, issued for
13         delivery, renewed, or modified after the effective
14         date of this amendatory Act of the 94th General
15         Assembly, 20 additional outpatient visits for speech
16         therapy for treatment of pervasive developmental
17         disorders that will be in addition to speech therapy
18         provided pursuant to item (ii) of this subparagraph
19         (A);
20         (B) may not include a lifetime limit on the number of
21     days of inpatient treatment or the number of outpatient
22     visits covered under the plan; and
23         (C) shall include the same amount limits, deductibles,
24     copayments, and coinsurance factors for serious mental
25     illness as for physical illness.
26     (5) An issuer of a group health benefit plan may not count
27 toward the number of outpatient visits required to be covered
28 under this Section an outpatient visit for the purpose of
29 medication management and shall cover the outpatient visits
30 under the same terms and conditions as it covers outpatient
31 visits for the treatment of physical illness.
32     (6) An issuer of a group health benefit plan may provide or
33 offer coverage required under this Section through a managed
34 care plan.
35     (7) This Section shall not be interpreted to require a
36 group health benefit plan to provide coverage for treatment of:



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1         (A) an addiction to a controlled substance or cannabis
2     that is used in violation of law; or
3         (B) mental illness resulting from the use of a
4     controlled substance or cannabis in violation of law.
5     (8) (Blank).
6 (Source: P.A. 94-402, eff. 8-2-05; P.A. 94-584, eff. 8-15-05;
7 revised 8-19-05.)
8     Section 10. The Health Maintenance Organization Act is
9 amended by changing Section 5-3 as follows:
10     (215 ILCS 125/5-3)  (from Ch. 111 1/2, par. 1411.2)
11     Sec. 5-3. Insurance Code provisions.
12     (a) Health Maintenance Organizations shall be subject to
13 the provisions of Sections 133, 134, 137, 140, 141.1, 141.2,
14 141.3, 143, 143c, 147, 148, 149, 151, 152, 153, 154, 154.5,
15 154.6, 154.7, 154.8, 155.04, 355.2, 356m, 356v, 356w, 356x,
16 356y, 356z.2, 356z.4, 356z.5, 356z.6, 364.01, 367.2, 367.2-5,
17 367i, 368a, 368b, 368c, 368d, 368e, 370c, 401, 401.1, 402, 403,
18 403A, 408, 408.2, 409, 412, 444, and 444.1, paragraph (c) of
19 subsection (2) of Section 367, and Articles IIA, VIII 1/2, XII,
20 XII 1/2, XIII, XIII 1/2, XXV, and XXVI of the Illinois
21 Insurance Code.
22     (b) For purposes of the Illinois Insurance Code, except for
23 Sections 444 and 444.1 and Articles XIII and XIII 1/2, Health
24 Maintenance Organizations in the following categories are
25 deemed to be "domestic companies":
26         (1) a corporation authorized under the Dental Service
27     Plan Act or the Voluntary Health Services Plans Act;
28         (2) a corporation organized under the laws of this
29     State; or
30         (3) a corporation organized under the laws of another
31     state, 30% or more of the enrollees of which are residents
32     of this State, except a corporation subject to
33     substantially the same requirements in its state of
34     organization as is a "domestic company" under Article VIII



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1     1/2 of the Illinois Insurance Code.
2     (c) In considering the merger, consolidation, or other
3 acquisition of control of a Health Maintenance Organization
4 pursuant to Article VIII 1/2 of the Illinois Insurance Code,
5         (1) the Director shall give primary consideration to
6     the continuation of benefits to enrollees and the financial
7     conditions of the acquired Health Maintenance Organization
8     after the merger, consolidation, or other acquisition of
9     control takes effect;
10         (2)(i) the criteria specified in subsection (1)(b) of
11     Section 131.8 of the Illinois Insurance Code shall not
12     apply and (ii) the Director, in making his determination
13     with respect to the merger, consolidation, or other
14     acquisition of control, need not take into account the
15     effect on competition of the merger, consolidation, or
16     other acquisition of control;
17         (3) the Director shall have the power to require the
18     following information:
19             (A) certification by an independent actuary of the
20         adequacy of the reserves of the Health Maintenance
21         Organization sought to be acquired;
22             (B) pro forma financial statements reflecting the
23         combined balance sheets of the acquiring company and
24         the Health Maintenance Organization sought to be
25         acquired as of the end of the preceding year and as of
26         a date 90 days prior to the acquisition, as well as pro
27         forma financial statements reflecting projected
28         combined operation for a period of 2 years;
29             (C) a pro forma business plan detailing an
30         acquiring party's plans with respect to the operation
31         of the Health Maintenance Organization sought to be
32         acquired for a period of not less than 3 years; and
33             (D) such other information as the Director shall
34         require.
35     (d) The provisions of Article VIII 1/2 of the Illinois
36 Insurance Code and this Section 5-3 shall apply to the sale by



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1 any health maintenance organization of greater than 10% of its
2 enrollee population (including without limitation the health
3 maintenance organization's right, title, and interest in and to
4 its health care certificates).
5     (e) In considering any management contract or service
6 agreement subject to Section 141.1 of the Illinois Insurance
7 Code, the Director (i) shall, in addition to the criteria
8 specified in Section 141.2 of the Illinois Insurance Code, take
9 into account the effect of the management contract or service
10 agreement on the continuation of benefits to enrollees and the
11 financial condition of the health maintenance organization to
12 be managed or serviced, and (ii) need not take into account the
13 effect of the management contract or service agreement on
14 competition.
15     (f) Except for small employer groups as defined in the
16 Small Employer Rating, Renewability and Portability Health
17 Insurance Act and except for medicare supplement policies as
18 defined in Section 363 of the Illinois Insurance Code, a Health
19 Maintenance Organization may by contract agree with a group or
20 other enrollment unit to effect refunds or charge additional
21 premiums under the following terms and conditions:
22         (i) the amount of, and other terms and conditions with
23     respect to, the refund or additional premium are set forth
24     in the group or enrollment unit contract agreed in advance
25     of the period for which a refund is to be paid or
26     additional premium is to be charged (which period shall not
27     be less than one year); and
28         (ii) the amount of the refund or additional premium
29     shall not exceed 20% of the Health Maintenance
30     Organization's profitable or unprofitable experience with
31     respect to the group or other enrollment unit for the
32     period (and, for purposes of a refund or additional
33     premium, the profitable or unprofitable experience shall
34     be calculated taking into account a pro rata share of the
35     Health Maintenance Organization's administrative and
36     marketing expenses, but shall not include any refund to be



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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. 92-764, eff. 1-1-03; 93-102, eff. 1-1-04; 93-261,
24 eff. 1-1-04; 93-477, eff. 8-8-03; 93-529, eff. 8-14-03; 93-853,
25 eff. 1-1-05; 93-1000, eff. 1-1-05; revised 10-14-04.)