Full Text of HB3976 97th General Assembly
HB3976ham001 97TH GENERAL ASSEMBLY | Rep. Karen May Filed: 2/23/2012
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| 1 | | AMENDMENT TO HOUSE BILL 3976
| 2 | | AMENDMENT NO. ______. Amend House Bill 3976 by replacing | 3 | | everything after the enacting clause with the following:
| 4 | | "Section 5. The Illinois Insurance Code is amended by | 5 | | adding Section 44.1 as follows: | 6 | | (215 ILCS 5/44.1 new) | 7 | | Sec. 44.1. Health insurance cooperatives. | 8 | | (a) In addition to all other provisions of this Article not | 9 | | in conflict with this Section, an entity seeking to organize | 10 | | under this Article as a health insurance cooperative shall meet | 11 | | all of the following requirements: | 12 | | (1) The entity shall comply with all provisions | 13 | | applicable to domestic mutual insurance companies under | 14 | | this Code. | 15 | | (2) The articles of incorporation of the entity shall | 16 | | demonstrate that the entity is to be organized as a |
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| 1 | | nonprofit member corporation and that the governance of the | 2 | | entity shall be subject to a majority vote of all members. | 3 | | (3) The activities of the entity shall include, but not | 4 | | be limited to, the issuance of health care plans in the | 5 | | individual and small group markets. | 6 | | (4) Either the articles of incorporation or the bylaws | 7 | | of the entity shall incorporate ethics and conflict of | 8 | | interest standards and the governance requirements set | 9 | | forth in Section 1322(c)(3)(C) of the federal Patient | 10 | | Protection and Affordable Care Act. | 11 | | (5) The entity or a related entity or any predecessor | 12 | | of either shall not have been a health insurance issuer on | 13 | | July 16, 2009. | 14 | | (6) The entity shall not be sponsored by a State or | 15 | | local government, any political subdivision thereof, or | 16 | | any instrumentality of such government or political | 17 | | subdivision. | 18 | | (7) Surplus shall be used to lower premiums, to improve | 19 | | benefits, or for other programs intended to improve the | 20 | | quality of health care delivered to its members. | 21 | | (8) No representative of a federal, State, or local | 22 | | government, or any political instrumentality thereof, and | 23 | | no representative of an entity described in paragraph (5) | 24 | | of subsection (a) of this Section may serve on the board of | 25 | | directors of the cooperative. | 26 | | (b) Notwithstanding Section 37 of this Article, the |
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| 1 | | corporate name of any organization seeking to organize under | 2 | | this Article as a health insurance cooperative need not contain | 3 | | the word "Mutual" but shall contain the phrase "Health | 4 | | Insurance Cooperative". The corporate name shall not be the | 5 | | same as, or deceptively similar to, the name of any domestic | 6 | | organization or of any foreign or alien organization authorized | 7 | | to transact business in this State. | 8 | | (c) An entity seeking to be organized as a health insurance | 9 | | cooperative shall submit an application to the Director | 10 | | according to procedures and meeting such requirements as the | 11 | | Director shall adopt by rule. No entity shall transact any | 12 | | business of insurance until it has received a certificate of | 13 | | authority as set forth in Section 51 of this Article. | 14 | | (d) The Department may adopt rules for the administration | 15 | | of the provisions of this Section. | 16 | | Section 10. The Co-operative Act is amended by changing | 17 | | Section 22 and by adding Section 30 as follows:
| 18 | | (805 ILCS 310/22) (from Ch. 32, par. 326)
| 19 | | Sec. 22. No corporation or association hereafter organized | 20 | | or doing
business for profit in this State shall be entitled to | 21 | | use the term
"Co-operative" as a part of its corporate or other | 22 | | business name or title
unless it has complied with the | 23 | | provisions of this Act, except (1) a corporation
organized | 24 | | under the Business Corporation Act of 1983 for the purpose of |
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| 1 | | ownership or administration of residential property on
a | 2 | | cooperative basis, or (2) a cooperative corporation organized | 3 | | under the General Not For Profit Corporation Act of 1986 or its | 4 | | predecessor or successor statutes , or (3) a domestic mutual | 5 | | insurance company licensed as a health insurance cooperative by | 6 | | the Director of Insurance under Article III of the Illinois | 7 | | Insurance Code . Any corporation
or association violating the | 8 | | provision of this Section may be enjoined from
doing business | 9 | | under such name at the instance of any shareholder of any
| 10 | | association or corporation organized under this Act.
| 11 | | (Source: P.A. 95-368, eff. 8-23-07.)
| 12 | | (805 ILCS 310/30 new) | 13 | | Sec. 30. Health insurance cooperative. | 14 | | (a) Notwithstanding any other provisions of this Act, | 15 | | health insurance cooperatives may be organized under this | 16 | | Section by one or more persons. | 17 | | (b) The purpose of a health insurance cooperative is to | 18 | | provide health care benefits for the individuals specified in | 19 | | subsection (h) of this Section as a risk-bearing entity. | 20 | | (c) A health insurance cooperative shall be designed so | 21 | | that all of the following are accomplished: | 22 | | (1) The members become better informed about health | 23 | | care trends and cost increases. | 24 | | (2) All members receive their health care benefits | 25 | | under the group health care policy or plan negotiated under |
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| 1 | | subsection (h) of this Section. | 2 | | (3) The members are actively engaged in designing | 3 | | health care benefit options that are offered by the insurer | 4 | | and that meet the needs of their community. | 5 | | (4) The health insurance risk of all of the members is | 6 | | pooled. | 7 | | (5) The members actively participate in health | 8 | | improvement decisions for their community. | 9 | | (d) The articles of a health insurance cooperative shall | 10 | | set forth the name and address of at least one incorporator who | 11 | | will act as the temporary board. | 12 | | (e) Each health insurance cooperative shall be organized on | 13 | | a membership basis with no capital stock. | 14 | | (f) Any person that does business in, is located in, has a | 15 | | principal office in, or resides in the geographic area in which | 16 | | a health insurance cooperative is organized, that meets the | 17 | | membership criteria established by the health insurance | 18 | | cooperative in its bylaws, and that pays the membership fee may | 19 | | be a member of the health insurance cooperative. | 20 | | (g) Each health insurance cooperative shall file its | 21 | | membership criteria, as well as any amendments to the criteria, | 22 | | with the Director. | 23 | | (h) Eligible members of the health insurance cooperative | 24 | | include: | 25 | | (1) An individual who is a member, officer, or eligible | 26 | | employee of a company or organization with 100 or fewer |
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| 1 | | employees. | 2 | | (2) A self-employed individual. | 3 | | (3) A dependent of an individual under items (1) and | 4 | | (2) of this subsection (h) who receives coverage. | 5 | | (i) Each health insurance cooperative shall submit to the | 6 | | Director annually, no later than September 30, a report on the | 7 | | health insurance cooperative described in this Section. | 8 | | (j) The membership contract between the health insurance
| 9 | | cooperative and the member shall be for a term of 3 years. Upon
| 10 | | membership enrollment in the health insurance cooperative,
| 11 | | each member shall pay to the health insurance cooperative a | 12 | | membership fee of at least $250. If a member withdraws from the | 13 | | health insurance cooperative before the end of the contract | 14 | | term, the member shall not be eligible to rejoin the health | 15 | | insurance cooperative for a period of at least one year, and | 16 | | the
health insurance cooperative may retain, as a penalty,
the | 17 | | membership fee. | 18 | | (k) As used in this Section, "Director" means the Director | 19 | | of Insurance.
| 20 | | Section 99. Effective date. This Act takes effect upon | 21 | | becoming law.".
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