Illinois General Assembly - Full Text of HB2296
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Full Text of HB2296  103rd General Assembly


Sen. Laura Fine

Filed: 5/24/2023





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2    AMENDMENT NO. ______. Amend House Bill 2296, AS AMENDED,
3by replacing everything after the enacting clause with the
5    "Section 5. The Department of Insurance Law is amended by
6adding Section 1405-50 as follows:
7    (20 ILCS 1405/1405-50 new)
8    Sec. 1405-50. Health insurance coverage, affordability,
9and cost transparency annual report.
10    (a) On or before May 1, 2026, and each May 1 thereafter,
11the Department of Insurance shall report to the Governor and
12the General Assembly on health insurance coverage,
13affordability, and cost trends, including:
14        (1) medical cost trends by major service category,
15    including prescription drugs;
16        (2) utilization patterns of services by major service



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1    categories;
2        (3) impact of benefit changes, including essential
3    health benefits and non-essential health benefits;
4        (4) enrollment trends;
5        (5) demographic shifts;
6        (6) geographic factors and variations, including
7    changes in provider availability;
8        (7) health care quality improvement initiatives;
9        (8)inflation and other factors impacting this State's
10    economic condition;
11        (9) the availability of financial assistance and tax
12    credits to pay for health insurance coverage for
13    individuals and small businesses;
14        (10) trends in out-of-pocket costs for consumers; and
15        (11) factors contributing to costs that are not
16    otherwise specified in paragraphs (1) through (10) of this
17    subsection.
18    (b) This report shall not attribute any information or
19trend to a specific company and shall not disclose any
20information otherwise considered confidential or proprietary.
21    Section 10. The Illinois Insurance Code is amended by
22changing Section 355 as follows:
23    (215 ILCS 5/355)  (from Ch. 73, par. 967)
24    Sec. 355. Accident and health policies; provisions.



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2    (a) As used in this Section:
3    "Inadequate rate" means a rate:
4        (1) that is insufficient to sustain projected losses
5    and expenses to which the rate applies; and
6        (2) the continued use of which endangers the solvency
7    of an insurer using that rate.
8    "Large employer" has the meaning provided in the Illinois
9Health Insurance Portability and Accountability Act.
10    "Plain language" has the meaning provided in the federal
11Plain Writing Act of 2010 and subsequent guidance documents,
12including the Federal Plain Language Guidelines.
13    "Unreasonable rate increase" means a rate increase that
14the Director determines to be excessive, unjustified, or
15unfairly discriminatory in accordance with 45 CFR 154.205.
16    (b) No policy of insurance against loss or damage from the
17sickness, or from the bodily injury or death of the insured by
18accident shall be issued or delivered to any person in this
19State until a copy of the form thereof and of the
20classification of risks and the premium rates pertaining
21thereto have been filed with the Director; nor shall it be so
22issued or delivered until the Director shall have approved
23such policy pursuant to the provisions of Section 143. If the
24Director disapproves the policy form, he or she shall make a
25written decision stating the respects in which such form does
26not comply with the requirements of law and shall deliver a



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1copy thereof to the company and it shall be unlawful
2thereafter for any such company to issue any policy in such
3form. On and after January 1, 2025, any form filing submitted
4for large employer group accident and health insurance shall
5be automatically deemed approved within 90 days of the
6submission date unless the Director extends by not more than
7an additional 30 days the period within which the form shall be
8approved or disapproved by giving written notice to the
9insurer of such extension before the expiration of the 90
10days. Any form in receipt of such an extension shall be
11automatically deemed approved within 120 days of the
12submission date. The Director may toll the filing due to a
13conflict in legal interpretation of federal or State law as
14long as the tolling is applied uniformly to all applicable
15forms, written notification is provided to the insurer prior
16to the tolling, the duration of the tolling is provided within
17the notice to the insurer, and justification for the tolling
18is posted to the Department's website. The Director may
19disapprove the filing if the insurer fails to respond to an
20objection or request for additional information within the
21timeframe identified for response. As used in this subsection,
22"large employer" has the meaning given in Section 5 of the
23federal Health Insurance Portability and Accountability Act.
24    (c) For plan year 2026 and thereafter, premium rates for
25all individual and small group accident and health insurance
26policies must be filed with the Department for approval.



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1Unreasonable rate increases or inadequate rates shall be
2modified or disapproved. For any plan year during which the
3Illinois Health Benefits Exchange operates as a full
4State-based exchange, the Department shall provide insurers at
5least 30 days' notice of the deadline to submit rate filings.
6    (d) For plan year 2025 and thereafter, the Department
7shall post all insurers' rate filings and summaries on the
8Department's website 5 business days after the rate filing
9deadline set by the Department in annual guidance. The rate
10filings and summaries posted to the Department's website shall
11exclude information that is proprietary or trade secret
12information protected under paragraph (g) of subsection (1) of
13Section 7 of the Freedom of Information Act or confidential or
14privileged under any applicable insurance law or rule. All
15summaries shall include a brief justification of any rate
16increase or decrease requested, including the number of
17individual members, the medical loss ratio, medical trend,
18administrative costs, and any other information required by
19rule. The plain writing summary shall include notification of
20the public comment period established in subsection (e).
21    (e) The Department shall open a 30-day public comment
22period on the rate filings beginning on the date that all of
23the rate filings are posted on the Department's website. The
24Department shall post all of the comments received to the
25Department's website within 5 business days after the comment
26period ends.



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1    (f) After the close of the public comment period described
2in subsection (e), the Department, beginning for plan year
32026, shall issue a decision to approve, disapprove, or modify
4a rate filing within 60 days. Any rate filing or any rates
5within a filing on which the Director does not issue a decision
6within 60 days shall automatically be deemed approved. The
7Director's decision shall take into account the actuarial
8justifications and public comments. The Department shall
9notify the insurer of the decision, make the decision
10available to the public by posting it on the Department's
11website, and include an explanation of the findings, actuarial
12justifications, and rationale that are the basis for the
13decision. Any company whose rate has been modified or
14disapproved shall be allowed to request a hearing within 10
15days after the action taken. The action of the Director in
16disapproving a rate shall be subject to judicial review under
17the Administrative Review Law.
18    (g) If, following the issuance of a decision but before
19the effective date of the premium rates approved by the
20decision, an event occurs that materially affects the
21Director's decision to approve, deny, or modify the rates, the
22Director may consider supplemental facts or data reasonably
23related to the event.
24    (h) The Department shall adopt rules implementing the
25procedures described in subsections (d) through (g) by March
2631, 2024.



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1    (i) Subsection (a) and subsections (c) through (h) of this
2Section do not apply to grandfathered health plans as defined
3in 45 CFR 147.140; excepted benefits as defined in 42 U.S.C.
4300gg-91; student health insurance coverage as defined in 45
5CFR 147.145; the large group market as defined in Section 5 of
6the Illinois Health Insurance Portability and Accountability
7Act; or short-term, limited-duration health insurance coverage
8as defined in Section 5 of the Short-Term, Limited-Duration
9Health Insurance Coverage Act. For a filing of premium rates
10or classifications of risk for any of these types of coverage,
11the Director's initial review period shall not exceed 60 days
12to issue informal objections to the company that request
13additional clarification, explanation, substantiating
14documentation, or correction of concerns identified in the
15filing before the company implements the premium rates,
16classifications, or related rate-setting methodologies
17described in the filing, except that the Director may extend
18by not more than an additional 30 days the period of initial
19review by giving written notice to the company of such
20extension before the expiration of the initial 60-day period.
21Nothing in this subsection shall confer authority upon the
22Director to approve, modify, or disapprove rates where that
23authority is not provided by other law. Nothing in this
24subsection shall prohibit the Director from conducting any
25investigation, examination, hearing, or other formal
26administrative or enforcement proceeding with respect to a



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1company's rate filing or implementation thereof under
2applicable law at any time, including after the period of
3initial review.
4(Source: P.A. 79-777.)
5    Section 15. The Health Maintenance Organization Act is
6amended by changing Section 4-12 as follows:
7    (215 ILCS 125/4-12)  (from Ch. 111 1/2, par. 1409.5)
8    Sec. 4-12. Changes in Rate Methodology and Benefits,
9Material Modifications. A health maintenance organization
10shall file with the Director, prior to use, a notice of any
11change in rate methodology, or benefits and of any material
12modification of any matter or document furnished pursuant to
13Section 2-1, together with such supporting documents as are
14necessary to fully explain the change or modification.
15    (a) Contract modifications described in subsections
16(c)(5), (c)(6) and (c)(7) of Section 2-1 shall include all
17form agreements between the organization and enrollees,
18providers, administrators of services and insurers of health
19maintenance organizations.
20    (b) Material transactions or series of transactions other
21than those described in subsection (a) of this Section, the
22total annual value of which exceeds the greater of $100,000 or
235% of net earned subscription revenue for the most current
2412-month twelve month period as determined from filed



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1financial statements.
2    (c) Any agreement between the organization and an insurer
3shall be subject to the provisions of the laws of this State
4regarding reinsurance as provided in Article XI of the
5Illinois Insurance Code. All reinsurance agreements must be
6filed. Approval of the Director is required for all agreements
7except the following: individual stop loss, aggregate excess,
8hospitalization benefits or out-of-area of the participating
9providers unless 20% or more of the organization's total risk
10is reinsured, in which case all reinsurance agreements require
12    (d) In addition to any applicable provisions of this Act,
13premium rate filings shall be subject to subsections (a) and
14(c) through (i) of Section 355 of the Illinois Insurance Code.
15(Source: P.A. 86-620.)
16    Section 20. The Limited Health Service Organization Act is
17amended by changing Section 3006 as follows:
18    (215 ILCS 130/3006)  (from Ch. 73, par. 1503-6)
19    Sec. 3006. Changes in rate methodology and benefits;
20material modifications; addition of limited health services.
21    (a) A limited health service organization shall file with
22the Director prior to use, a notice of any change in rate
23methodology, charges or benefits and of any material
24modification of any matter or document furnished pursuant to



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1Section 2001, together with such supporting documents as are
2necessary to fully explain the change or modification.
3        (1) Contract modifications described in paragraphs (5)
4    and (6) of subsection (c) of Section 2001 shall include
5    all agreements between the organization and enrollees,
6    providers, administrators of services and insurers of
7    limited health services; also other material transactions
8    or series of transactions, the total annual value of which
9    exceeds the greater of $100,000 or 5% of net earned
10    subscription revenue for the most current 12 month period
11    as determined from filed financial statements.
12        (2) Contract modification for reinsurance. Any
13    agreement between the organization and an insurer shall be
14    subject to the provisions of Article XI of the Illinois
15    Insurance Code, as now or hereafter amended. All
16    reinsurance agreements must be filed with the Director.
17    Approval of the Director in required agreements must be
18    filed. Approval of the director is required for all
19    agreements except individual stop loss, aggregate excess,
20    hospitalization benefits or out-of-area of the
21    participating providers, unless 20% or more of the
22    organization's total risk is reinsured, in which case all
23    reinsurance agreements shall require approval.
24    (b) If a limited health service organization desires to
25add one or more additional limited health services, it shall
26file a notice with the Director and, at the same time, submit



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1the information required by Section 2001 if different from
2that filed with the prepaid limited health service
3organization's application. Issuance of such an amended
4certificate of authority shall be subject to the conditions of
5Section 2002 of this Act.
6    (c) In addition to any applicable provisions of this Act,
7premium rate filings shall be subject to subsection (i) of
8Section 355 of the Illinois Insurance Code.
9(Source: P.A. 86-600.)".