[ Search ] [ Legislation ] [ Bill Summary ]
[ Home ] [ Back ] [ Bottom ]
| [ Introduced ] |
90_HB0673eng
215 ILCS 5/122-1 from Ch. 73, par. 734-1
215 ILCS 5/1003 from Ch. 73, par. 1065.703
215 ILCS 105/8 from Ch. 73, par. 1308
Amends the Illinois Insurance Code. Provides that
persons who provide coverage for naprapathic services are
subject to the jurisdiction of the Department of Insurance.
Includes a naprapath within the scope of the term "medical
professional" under the Insurance Information and Privacy
Protection Article of the Code. Amends the Comprehensive
Health Insurance Plan Act. Includes coverage for naprapathic
services under the minimum benefits available under that Act.
LRB9003688JSgc
HB0673 Engrossed LRB9003688JSgc
1 AN ACT concerning naprapathic services, amending named
2 Acts.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The Illinois Insurance Code is amended by
6 changing Sections 122-1 and 1003 as follows:
7 (215 ILCS 5/122-1) (from Ch. 73, par. 734-1)
8 Sec. 122-1. The authority and jurisdiction of Insurance
9 Department. Notwithstanding any other provision of law, and
10 except as provided herein, any person or other entity which
11 provides coverage in this State for medical, surgical,
12 chiropractic, naprapathic, physical therapy, speech
13 pathology, audiology, professional mental health, dental,
14 hospital, ophthalmologic, or optometric expenses, whether
15 such coverage is by direct-payment, reimbursement, or
16 otherwise, shall be presumed to be subject to the
17 jurisdiction of the Department unless the person or other
18 entity shows that while providing such coverage it is subject
19 to the jurisdiction of another agency of this state, any
20 subdivision of this state, or the Federal Government, or is a
21 plan of self-insurance or other employee welfare benefit
22 program of an individual employer or labor union established
23 or maintained under or pursuant to a collective bargaining
24 agreement or other arrangement which provides for health care
25 services solely for its employees or members and their
26 dependents.
27 (Source: P.A. 86-753.)
28 (215 ILCS 5/1003) (from Ch. 73, par. 1065.703)
29 Sec. 1003. Definitions. As used in this Article: (A)
30 "Adverse underwriting decision" means:
HB0673 Engrossed -2- LRB9003688JSgc
1 (1) any of the following actions with respect to
2 insurance transactions involving insurance coverage which is
3 individually underwritten:
4 (a) a declination of insurance coverage,
5 (b) a termination of insurance coverage,
6 (c) failure of an agent to apply for insurance coverage
7 with a specific insurance institution which the agent
8 represents and which is requested by an applicant,
9 (d) in the case of a property or casualty insurance
10 coverage:
11 (i) placement by an insurance institution or agent of a
12 risk with a residual market mechanism, an unauthorized
13 insurer or an insurance institution which specializes in
14 substandard risks, or
15 (ii) the charging of a higher rate on the basis of
16 information which differs from that which the applicant or
17 policyholder furnished, or
18 (e) in the case of life, health or disability insurance
19 coverage, an offer to insure at higher than standard rates.
20 (2) Notwithstanding paragraph (1) above, the following
21 actions shall not be considered adverse underwriting
22 decisions but the insurance institution or agent responsible
23 for their occurrence shall nevertheless provide the applicant
24 or policyholder with the specific reason or reasons for their
25 occurrence:
26 (a) the termination of an individual policy form on a
27 class or statewide basis,
28 (b) a declination of insurance coverage solely because
29 such coverage is not available on a class or statewide basis,
30 or
31 (c) the rescission of a policy.
32 (B) "Affiliate" or "affiliated" means a person that
33 directly, or indirectly through one or more intermediaries,
34 controls, is controlled by or is under common control with
HB0673 Engrossed -3- LRB9003688JSgc
1 another person.
2 (C) "Agent" means an individual, firm, partnership,
3 association or corporation who is involved in the
4 solicitation, negotiation or binding of coverages for or on
5 applications or policies of insurance, covering property or
6 risks located in this State. For the purposes of this
7 Article, both "Insurance Agent" and "Insurance Broker", as
8 defined in Section 490, shall be considered an agent.
9 (D) "Applicant" means any person who seeks to contract
10 for insurance coverage other than a person seeking group
11 insurance that is not individually underwritten.
12 (E) "Director" means the Director of Insurance.
13 (F) "Consumer report" means any written, oral or other
14 communication of information bearing on a natural person's
15 credit worthiness, credit standing, credit capacity,
16 character, general reputation, personal characteristics or
17 mode of living which is used or expected to be used in
18 connection with an insurance transaction.
19 (G) "Consumer reporting agency" means any person who:
20 (1) regularly engages, in whole or in part, in the
21 practice of assembling or preparing consumer reports for a
22 monetary fee,
23 (2) obtains information primarily from sources other than
24 insurance institutions, and
25 (3) furnishes consumer reports to other persons.
26 (H) "Control", including the terms "controlled by" or
27 "under common control with", means the possession, direct or
28 indirect, of the power to direct or cause the direction of
29 the management and policies of a person, whether through the
30 ownership of voting securities, by contract other than a
31 commercial contract for goods or nonmanagement services, or
32 otherwise, unless the power is the result of an official
33 position with or corporate office held by the person.
34 (I) "Declination of insurance coverage" means a denial,
HB0673 Engrossed -4- LRB9003688JSgc
1 in whole or in part, by an insurance institution or agent of
2 requested insurance coverage.
3 (J) "Individual" means any natural person who:
4 (1) in the case of property or casualty insurance, is a
5 past, present or proposed named insured or certificateholder;
6 (2) in the case of life, health or disability insurance,
7 is a past, present or proposed principal insured or
8 certificateholder;
9 (3) is a past, present or proposed policyowner;
10 (4) is a past or present applicant;
11 (5) is a past or present claimant; or
12 (6) derived, derives or is proposed to derive insurance
13 coverage under an insurance policy or certificate subject to
14 this Article.
15 (K) "Institutional source" means any person or
16 governmental entity that provides information about an
17 individual to an agent, insurance institution or
18 insurance-support organization, other than:
19 (1) an agent,
20 (2) the individual who is the subject of the
21 information, or
22 (3) a natural person acting in a personal capacity
23 rather than in a business or professional capacity.
24 (L) "Insurance institution" means any corporation,
25 association, partnership, reciprocal exchange, inter-insurer,
26 Lloyd's insurer, fraternal benefit society or other person
27 engaged in the business of insurance, health maintenance
28 organizations as defined in Section 2 of the "Health
29 Maintenance Organization Act", medical service plans as
30 defined in Section 2 of "The Medical Service Plan Act",
31 hospital service corporation under "The Nonprofit Health Care
32 Service Plan Act", voluntary health services plans as defined
33 in Section 2 of "The Voluntary Health Services Plans Act",
34 vision service plans as defined in Section 2 of "The Vision
HB0673 Engrossed -5- LRB9003688JSgc
1 Service Plan Act", dental service plans as defined in Section
2 4 of "The Dental Service Plan Act", and pharmaceutical
3 service plans as defined in Section 4 of "The Pharmaceutical
4 Service Plan Act". "Insurance institution" shall not include
5 agents or insurance-support organizations.
6 (M) "Insurance-support organization" means: (1) any
7 person who regularly engages, in whole or in part, in the
8 practice of assembling or collecting information about
9 natural persons for the primary purpose of providing the
10 information to an insurance institution or agent for
11 insurance transactions, including:
12 (a) the furnishing of consumer reports or investigative
13 consumer reports to an insurance institution or agent for use
14 in connection with an insurance transaction, or
15 (b) the collection of personal information from
16 insurance institutions, agents or other insurance-support
17 organizations for the purpose of detecting or preventing
18 fraud, material misrepresentation or material nondisclosure
19 in connection with insurance underwriting or insurance claim
20 activity.
21 (2) Notwithstanding paragraph (1) above, the following
22 persons shall not be considered "insurance-support
23 organizations" for purposes of this Article: agents,
24 government institutions, insurance institutions, medical care
25 institutions and medical professionals.
26 (N) "Insurance transaction" means any transaction
27 involving insurance primarily for personal, family or
28 household needs rather than business or professional needs
29 which entails:
30 (1) the determination of an individual's eligibility for
31 an insurance coverage, benefit or payment, or
32 (2) the servicing of an insurance application, policy,
33 contract or certificate.
34 (O) "Investigative consumer report" means a consumer
HB0673 Engrossed -6- LRB9003688JSgc
1 report or portion thereof in which information about a
2 natural person's character, general reputation, personal
3 characteristics or mode of living is obtained through
4 personal interviews with the person's neighbors, friends,
5 associates, acquaintances or others who may have knowledge
6 concerning such items of information.
7 (P) "Medical-care institution" means any facility or
8 institution that is licensed to provide health care services
9 to natural persons, including but not limited to: hospitals,
10 skilled nursing facilities, home-health agencies, medical
11 clinics, rehabilitation agencies and public-health agencies
12 and health-maintenance organizations.
13 (Q) "Medical professional" means any person licensed or
14 certified to provide health care services to natural
15 persons, including but not limited to, a physician, dentist,
16 nurse, optometrist, chiropractor, naprapath, pharmacist,
17 physical or occupational therapist, psychiatric social
18 worker, speech therapist, clinical dietitian or clinical
19 psychologist.
20 (R) "Medical-record information" means personal
21 information which:
22 (1) relates to an individual's physical or mental
23 condition, medical history or medical treatment, and
24 (2) is obtained from a medical professional or
25 medical-care institution, from the individual, or from the
26 individual's spouse, parent or legal guardian.
27 (S) "Person" means any natural person, corporation,
28 association, partnership or other legal entity.
29 (T) "Personal information" means any individually
30 identifiable information gathered in connection with an
31 insurance transaction from which judgments can be made about
32 an individual's character, habits, avocations, finances,
33 occupation, general reputation, credit, health or any other
34 personal characteristics. "Personal information" includes an
HB0673 Engrossed -7- LRB9003688JSgc
1 individual's name and address and "medical-record
2 information" but does not include "privileged information".
3 (U) "Policyholder" means any person who:
4 (1) in the case of individual property or casualty
5 insurance, is a present named insured;
6 (2) in the case of individual life, health or disability
7 insurance, is a present policyowner; or
8 (3) in the case of group insurance which is individually
9 underwritten, is a present group certificateholder.
10 (V) "Pretext interview" means an interview whereby a
11 person, in an attempt to obtain information about a natural
12 person, performs one or more of the following acts:
13 (1) pretends to be someone he or she is not,
14 (2) pretends to represent a person he or she is not in
15 fact representing,
16 (3) misrepresents the true purpose of the interview, or
17 (4) refuses to identify himself or herself upon request.
18 (W) "Privileged information" means any individually
19 identifiable information that: (1) relates to a claim for
20 insurance benefits or a civil or criminal proceeding
21 involving an individual, and (2) is collected in connection
22 with or in reasonable anticipation of a claim for insurance
23 benefits or civil or criminal proceeding involving an
24 individual; provided, however, information otherwise meeting
25 the requirements of this subsection shall nevertheless be
26 considered "personal information" under this Article if it is
27 disclosed in violation of Section 1014 of this Article.
28 (X) "Residual market mechanism" means an association,
29 organization or other entity described in Article XXXIII of
30 this Act, or Section 7-501 of "The Illinois Vehicle Code".
31 (Y) "Termination of insurance coverage" or "termination
32 of an insurance policy" means either a cancellation or
33 nonrenewal of an insurance policy, in whole or in part, for
34 any reason other than the failure to pay a premium as
HB0673 Engrossed -8- LRB9003688JSgc
1 required by the policy.
2 (Z) "Unauthorized insurer" means an insurance institution
3 that has not been granted a certificate of authority by the
4 Director to transact the business of insurance in this State.
5 (Source: P.A. 82-108.)
6 Section 10. The Comprehensive Health Insurance Plan Act
7 is amended by changing Section 8 as follows:
8 (215 ILCS 105/8) (from Ch. 73, par. 1308)
9 Sec. 8. Minimum benefits.
10 a. Availability. The Plan shall offer in an annually
11 renewable policy major medical expense coverage to every
12 eligible person who is not eligible for Medicare. Major
13 medical expense coverage offered by the Plan shall pay an
14 eligible person's covered expenses, subject to limit on the
15 deductible and coinsurance payments authorized under
16 paragraph (4) of subsection d of this Section, up to a
17 lifetime benefit limit of $500,000 per covered individual.
18 The maximum limit under this subsection shall not be altered
19 by the Board, and no actuarial equivalent benefit may be
20 substituted by the Board. Any person who otherwise would
21 qualify for coverage under the Plan, but is excluded because
22 he or she is eligible for Medicare, shall be eligible for any
23 separate Medicare supplement policy which the Board may
24 offer.
25 b. Covered expenses. Covered expenses shall be limited
26 to the reasonable and customary charge, including negotiated
27 fees, in the locality for the following services and articles
28 when medically necessary and prescribed by a person licensed
29 and practicing within the scope of his or her profession as
30 authorized by State law:
31 (1) Hospital room and board and any other hospital
32 services, except that inpatient hospitalization for the
HB0673 Engrossed -9- LRB9003688JSgc
1 treatment of mental and emotional disorders shall only be
2 covered for a maximum of 45 days in a calendar year.
3 (2) Professional services for the diagnosis or
4 treatment of injuries, illnesses or conditions, other
5 than dental, or outpatient mental as described in
6 paragraph (17), which are rendered by a physician or
7 chiropractor, or by other licensed professionals at the
8 physician's or chiropractor's direction.
9 (3) If surgery has been recommended, a second
10 opinion may be required. The charge for a second opinion
11 as to whether the surgery is required will be paid in
12 full without regard to deductible or co-payment
13 requirements. If the second opinion differs from the
14 first, the charge for a third opinion, if desired, will
15 also be paid in full without regard to deductible or
16 co-payment requirements. Regardless of whether the
17 second opinion or third opinion confirms the original
18 recommendation, it is the patient's decision whether to
19 undergo surgery.
20 (4) Drugs requiring a physician's or other legally
21 authorized prescription.
22 (5) Skilled nursing care provided in a skilled
23 nursing facility for not more than 120 days in a calendar
24 year, provided the service commences within 14 days
25 following a confinement of at least 3 consecutive days in
26 a hospital for the same condition.
27 (6) Services of a home health agency in accord with
28 a home health care plan, up to a maximum of 270 visits
29 per year.
30 (7) Services of a licensed hospice for not more
31 than 180 days during a policy year.
32 (8) Use of radium or other radioactive materials.
33 (9) Oxygen.
34 (10) Anesthetics.
HB0673 Engrossed -10- LRB9003688JSgc
1 (11) Orthoses and prostheses other than dental.
2 (12) Rental or purchase in accordance with Board
3 policies or procedures of durable medical equipment,
4 other than eyeglasses or hearing aids, for which there is
5 no personal use in the absence of the condition for which
6 it is prescribed.
7 (13) Diagnostic x-rays and laboratory tests.
8 (14) Oral surgery for excision of partially or
9 completely unerupted impacted teeth or the gums and
10 tissues of the mouth, when not performed in connection
11 with the routine extraction or repair of teeth, and oral
12 surgery and procedures, including orthodontics and
13 prosthetics necessary for craniofacial or maxillofacial
14 conditions and to correct congenital defects or injuries
15 due to accident.
16 (15) Physical, speech, and functional occupational
17 therapy as medically necessary and provided by
18 appropriate licensed professionals.
19 (16) Transportation provided by a licensed
20 ambulance service to the nearest health care facility
21 qualified to treat the illness, injury or condition,
22 subject to the provisions of the Emergency Medical
23 Systems (EMS) Act.
24 (17) The first 50 professional outpatient visits
25 for diagnosis and treatment of mental and emotional
26 disorders rendered during the year, up to a maximum of
27 $80 per visit.
28 (18) Human organ or tissue transplants specified by
29 the Board that are performed at a hospital designated by
30 the Board as a participating transplant center for that
31 specific organ or tissue transplant.
32 (19) Naprapathic services, as appropriate, provided
33 by a licensed naprapathic practitioner.
34 c. Exclusion. Covered expenses of the Plan shall not
HB0673 Engrossed -11- LRB9003688JSgc
1 include the following:
2 (1) Any charge for treatment for cosmetic purposes
3 other than for reconstructive surgery when the service is
4 incidental to or follows surgery resulting from injury,
5 sickness or other diseases of the involved part or
6 surgery for the repair or treatment of a congenital
7 bodily defect to restore normal bodily functions.
8 (2) Any charge for care that is primarily for rest,
9 custodial, educational, or domiciliary purposes.
10 (3) Any charge for services in a private room to
11 the extent it is in excess of the institution's charge
12 for its most common semiprivate room, unless a private
13 room is prescribed as medically necessary by a physician.
14 (4) That part of any charge for room and board or
15 for services rendered or articles prescribed by a
16 physician, dentist, or other health care personnel that
17 exceeds the reasonable and customary charge in the
18 locality or for any services or supplies not medically
19 necessary for the diagnosed injury or illness.
20 (5) Any charge for services or articles the
21 provision of which is not within the scope of licensure
22 of the institution or individual providing the services
23 or articles.
24 (6) Any expense incurred prior to the effective
25 date of coverage by the Plan for the person on whose
26 behalf the expense is incurred.
27 (7) Dental care, dental surgery, dental treatment
28 or dental appliances, except as provided in paragraph
29 (14) of subsection b of this Section.
30 (8) Eyeglasses, contact lenses, hearing aids or
31 their fitting.
32 (9) Illness or injury due to (A) war or any acts of
33 war; (B) commission of, or attempt to commit, a felony;
34 or (C) aviation activities, except when traveling as a
HB0673 Engrossed -12- LRB9003688JSgc
1 fare-paying passenger on a commercial airline.
2 (10) Services of blood donors and any fee for
3 failure to replace blood provided to an eligible person
4 each policy year.
5 (11) Personal supplies or services provided by a
6 hospital or nursing home, or any other nonmedical or
7 nonprescribed supply or service.
8 (12) Routine maternity charges for a pregnancy,
9 except where added as optional coverage with payment of
10 an additional premium for pregnancy resulting from
11 conception occurring after the effective date of the
12 optional coverage.
13 (13) Expenses of obtaining an abortion, induced
14 miscarriage or induced premature birth unless, in the
15 opinion of a physician, those procedures are necessary
16 for the preservation of life of the woman seeking such
17 treatment, or except an induced premature birth intended
18 to produce a live viable child and the procedure is
19 necessary for the health of the mother or unborn child.
20 (14) Any expense or charge for services, drugs, or
21 supplies that are: (i) not provided in accord with
22 generally accepted standards of current medical practice;
23 (ii) for procedures, treatments, equipment, transplants,
24 or implants, any of which are investigational,
25 experimental, or for research purposes; (iii)
26 investigative and not proven safe and effective; or (iv)
27 for, or resulting from, a gender transformation
28 operation.
29 (15) Any expense or charge for routine physical
30 examinations or tests.
31 (16) Any expense for which a charge is not made in
32 the absence of insurance or for which there is no legal
33 obligation on the part of the patient to pay.
34 (17) Any expense incurred for benefits provided
HB0673 Engrossed -13- LRB9003688JSgc
1 under the laws of the United States and this State,
2 including Medicare and Medicaid and other medical
3 assistance, military service-connected disability
4 payments, medical services provided for members of the
5 armed forces and their dependents or employees of the
6 armed forces of the United States, and medical services
7 financed on behalf of all citizens by the United States.
8 (18) Any expense or charge for in vitro
9 fertilization, artificial insemination, or any other
10 artificial means used to cause pregnancy.
11 (19) Any expense or charge for oral contraceptives
12 used for birth control or any other temporary birth
13 control measures.
14 (20) Any expense or charge for sterilization or
15 sterilization reversals.
16 (21) Any expense or charge for weight loss
17 programs, exercise equipment, or treatment of obesity,
18 except when certified by a physician as morbid obesity
19 (at least 2 times normal body weight).
20 (22) Any expense or charge for acupuncture
21 treatment unless used as an anesthetic agent for a
22 covered surgery.
23 (23) Any expense or charge for or related to organ
24 or tissue transplants other than those performed at a
25 hospital with a Board approved organ transplant program
26 that has been designated by the Board as a preferred or
27 exclusive provider organization for that specific organ
28 or tissue.
29 (24) Any expense or charge for procedures,
30 treatments, equipment, or services that are provided in
31 special settings for research purposes or in a controlled
32 environment, are being studied for safety, efficiency,
33 and effectiveness, and are awaiting endorsement by the
34 appropriate national medical speciality college for
HB0673 Engrossed -14- LRB9003688JSgc
1 general use within the medical community.
2 d. Premiums, deductibles, and coinsurance.
3 (1) Premiums charged for coverage issued by the
4 Plan may not be unreasonable in relation to the benefits
5 provided, the risk experience and the reasonable expenses
6 of providing the coverage.
7 (2) Separate schedules of premium rates based on
8 sex, age and geographical location shall apply for
9 individual risks.
10 (3) The Plan may provide for separate premium rates
11 for optional family coverage for the spouse or one or
12 more dependents of any person eligible to be insured
13 under the Plan who is also the oldest adult member of the
14 family and remains continuously enrolled in the Plan as
15 the primary enrollee. The rates shall be such percentage
16 of the applicable individual Plan rate as the Board, in
17 accordance with appropriate actuarial principles, shall
18 establish for each spouse or dependent.
19 (4) The Board shall determine, in accordance with
20 appropriate actuarial principles, the average rates that
21 individual standard risks in this State are charged by at
22 least 5 of the largest insurers providing coverage to
23 residents of Illinois that is substantially similar to
24 the Plan coverage. In the event at least 5 insurers do
25 not offer substantially similar coverage, the rates shall
26 be established using reasonable actuarial techniques and
27 shall reflect anticipated claims experience, expenses,
28 and other appropriate risk factors relating to the Plan.
29 Rates for Plan coverage shall be 135% of rates so
30 established as applicable for individual standard risks;
31 provided, however, if after determining that the
32 appropriations made pursuant to Section 12 of this Act
33 are insufficient to ensure that total income from all
34 sources will equal or exceed the total incurred costs and
HB0673 Engrossed -15- LRB9003688JSgc
1 expenses for the current number of enrollees, the board
2 shall raise premium rates above this 135% standard to the
3 level it deems necessary to ensure the financial solvency
4 of the Plan for enrollees already in the Plan. All rates
5 and rate schedules shall be submitted to the board for
6 approval.
7 (5) The Plan coverage defined in Section 6 shall
8 provide for a choice of deductibles as authorized by the
9 Board per individual per annum. If 2 individual members
10 of a family satisfy the same applicable deductibles, no
11 other member of that family who is eligible for coverage
12 under the Plan shall be required to meet any deductibles
13 for the balance of that calendar year. The deductibles
14 must be applied first to the authorized amount of covered
15 expenses incurred by the covered person. A mandatory
16 coinsurance requirement shall be imposed at the rate
17 authorized by the Board in excess of the mandatory
18 deductible, the coinsurance in the aggregate not to
19 exceed such amounts as are authorized by the Board per
20 annum. At its discretion the Board may, however, offer
21 catastrophic coverages or other policies that provide for
22 larger deductibles with or without coinsurance
23 requirements. The deductibles and coinsurance factors
24 may be adjusted annually according to the Medical
25 Component of the Consumer Price Index.
26 (6) The Plan may provide for and employ cost
27 containment measures and requirements including, but not
28 limited to, preadmission certification, second surgical
29 opinion, concurrent utilization review programs,
30 individual case management, preferred provider
31 organizations, and other cost effective arrangements for
32 paying for covered expenses.
33 e. Scope of coverage. Except as provided in subsection
34 c of this Section, if the covered expenses incurred by the
HB0673 Engrossed -16- LRB9003688JSgc
1 eligible person exceed the deductible for major medical
2 expense coverage in a calendar year, the Plan shall pay at
3 least 80% of any additional covered expenses incurred by the
4 person during the calendar year.
5 f. Preexisting conditions.
6 (1) Six months: Plan coverage shall exclude charges
7 or expenses incurred during the first 6 months following
8 the effective date of coverage as to any condition if:
9 (a) the condition had manifested itself within the 6
10 month period immediately preceding the effective date of
11 coverage in such a manner as would cause an ordinarily
12 prudent person to seek diagnosis, care or treatment; or
13 (b) medical advice, care or treatment was recommended or
14 received within the 6 month period immediately preceding
15 the effective date of coverage.
16 (2) (Blank).
17 (3) Waiver: The preexisting condition exclusions as
18 set forth in paragraph (1) of this subsection shall be
19 waived to the extent to which the eligible person: (a)
20 has satisfied similar exclusions under any prior health
21 insurance policy or plan that was involuntarily
22 terminated; (b) is ineligible for any continuation or
23 conversion rights that would continue or provide
24 substantially similar coverage following that
25 termination; and (c) has applied for Plan coverage not
26 later than 30 days following the involuntary termination.
27 No policy or plan shall be deemed to have been
28 involuntarily terminated if the master policyholder or
29 other controlling party elected to change insurance
30 coverage from one company or plan to another even if that
31 decision resulted in a discontinuation of coverage for
32 any individual under the plan, either totally or for any
33 medical condition. For each eligible person who qualifies
34 for and elects this waiver, there shall be added to each
HB0673 Engrossed -17- LRB9003688JSgc
1 payment of premium, on a prorated basis, a surcharge of
2 up to 10% of the otherwise applicable annual premium for
3 as long as that individual's coverage under the Plan
4 remains in effect or 60 months, whichever is less.
5 g. Other sources primary; nonduplication of benefits.
6 (1) The Plan shall be the last payor of benefits
7 whenever any other benefit or source of third party
8 payment is available. Subject to the provisions of
9 subsection e of Section 7, benefits otherwise payable
10 under Plan coverage shall be reduced by all amounts paid
11 or payable by Medicare or any other government program or
12 through any health insurance or other health benefit
13 plan, whether insured or otherwise, or through any third
14 party liability, settlement, judgment, or award,
15 regardless of the date of the settlement, judgment, or
16 award, whether the settlement, judgment, or award is in
17 the form of a contract, agreement, or trust on behalf of
18 a minor or otherwise and whether the settlement,
19 judgment, or award is payable to the covered person, his
20 or her dependent, estate, personal representative, or
21 guardian in a lump sum or over time, and by all hospital
22 or medical expense benefits paid or payable under any
23 worker's compensation coverage, automobile medical
24 payment, or liability insurance, whether provided on the
25 basis of fault or nonfault, and by any hospital or
26 medical benefits paid or payable under or provided
27 pursuant to any State or federal law or program.
28 (2) The Plan shall have a cause of action against
29 any covered person or any other person or entity for the
30 recovery of any amount paid to the extent the amount was
31 for treatment, services, or supplies not covered in this
32 Section or in excess of benefits as set forth in this
33 Section.
34 (3) Whenever benefits are due from the Plan because
HB0673 Engrossed -18- LRB9003688JSgc
1 of sickness or an injury to a covered person resulting
2 from a third party's wrongful act or negligence and the
3 covered person has recovered or may recover damages from
4 a third party or its insurer, the Plan shall have the
5 right to reduce benefits or to refuse to pay benefits
6 that otherwise may be payable by the amount of damages
7 that the covered person has recovered or may recover
8 regardless of the date of the sickness or injury or the
9 date of any settlement, judgment, or award resulting from
10 that sickness or injury.
11 During the pendency of any action or claim that is
12 brought by or on behalf of a covered person against a
13 third party or its insurer, any benefits that would
14 otherwise be payable except for the provisions of this
15 paragraph (3) shall be paid if payment by or for the
16 third party has not yet been made and the covered person
17 or, if incapable, that person's legal representative
18 agrees in writing to pay back promptly the benefits paid
19 as a result of the sickness or injury to the extent of
20 any future payments made by or for the third party for
21 the sickness or injury. This agreement is to apply
22 whether or not liability for the payments is established
23 or admitted by the third party or whether those payments
24 are itemized.
25 Any amounts due the plan to repay benefits may be
26 deducted from other benefits payable by the Plan after
27 payments by or for the third party are made.
28 (4) Benefits due from the Plan may be reduced or
29 refused as an offset against any amount otherwise
30 recoverable under this Section.
31 h. Right of subrogation; recoveries.
32 (1) Whenever the Plan has paid benefits because of
33 sickness or an injury to any covered person resulting
34 from a third party's wrongful act or negligence, or for
HB0673 Engrossed -19- LRB9003688JSgc
1 which an insurer is liable in accordance with the
2 provisions of any policy of insurance, and the covered
3 person has recovered or may recover damages from a third
4 party that is liable for the damages, the Plan shall have
5 the right to recover the benefits it paid from any
6 amounts that the covered person has received or may
7 receive regardless of the date of the sickness or injury
8 or the date of any settlement, judgment, or award
9 resulting from that sickness or injury. The Plan shall
10 be subrogated to any right of recovery the covered person
11 may have under the terms of any private or public health
12 care coverage or liability coverage, including coverage
13 under the Workers' Compensation Act or the Workers'
14 Occupational Diseases Act, without the necessity of
15 assignment of claim or other authorization to secure the
16 right of recovery. To enforce its subrogation right, the
17 Plan may (i) intervene or join in an action or proceeding
18 brought by the covered person or his personal
19 representative, including his guardian, conservator,
20 estate, dependents, or survivors, against any third party
21 or the third party's insurer that may be liable or (ii)
22 institute and prosecute legal proceedings against any
23 third party or the third party's insurer that may be
24 liable for the sickness or injury in an appropriate court
25 either in the name of the Plan or in the name of the
26 covered person or his personal representative, including
27 his guardian, conservator, estate, dependents, or
28 survivors.
29 (2) If any action or claim is brought by or on
30 behalf of a covered person against a third party or the
31 third party's insurer, the covered person or his personal
32 representative, including his guardian, conservator,
33 estate, dependents, or survivors, shall notify the Plan
34 by personal service or registered mail of the action or
HB0673 Engrossed -20- LRB9003688JSgc
1 claim and of the name of the court in which the action or
2 claim is brought, filing proof thereof in the action or
3 claim. The Plan may, at any time thereafter, join in the
4 action or claim upon its motion so that all orders of
5 court after hearing and judgment shall be made for its
6 protection. No release or settlement of a claim for
7 damages and no satisfaction of judgment in the action
8 shall be valid without the written consent of the Plan to
9 the extent of its interest in the settlement or judgment
10 and of the covered person or his personal representative.
11 (3) In the event that the covered person or his
12 personal representative fails to institute a proceeding
13 against any appropriate third party before the fifth
14 month before the action would be barred, the Plan may, in
15 its own name or in the name of the covered person or
16 personal representative, commence a proceeding against
17 any appropriate third party for the recovery of damages
18 on account of any sickness, injury, or death to the
19 covered person. The covered person shall cooperate in
20 doing what is reasonably necessary to assist the Plan in
21 any recovery and shall not take any action that would
22 prejudice the Plan's right to recovery. The Plan shall
23 pay to the covered person or his personal representative
24 all sums collected from any third party by judgment or
25 otherwise in excess of amounts paid in benefits under the
26 Plan and amounts paid or to be paid as costs, attorneys
27 fees, and reasonable expenses incurred by the Plan in
28 making the collection or enforcing the judgment.
29 (4) In the event that a covered person or his
30 personal representative, including his guardian,
31 conservator, estate, dependents, or survivors, recovers
32 damages from a third party for sickness or injury caused
33 to the covered person, the covered person or the personal
34 representative shall pay to the Plan from the damages
HB0673 Engrossed -21- LRB9003688JSgc
1 recovered the amount of benefits paid or to be paid on
2 behalf of the covered person.
3 (5) When the action or claim is brought by the
4 covered person alone and the covered person incurs a
5 personal liability to pay attorney's fees and costs of
6 litigation, the Plan's claim for reimbursement of the
7 benefits provided to the covered person shall be the full
8 amount of benefits paid to or on behalf of the covered
9 person under this Act less a pro rata share that
10 represents the Plan's reasonable share of attorney's fees
11 paid by the covered person and that portion of the cost
12 of litigation expenses determined by multiplying by the
13 ratio of the full amount of the expenditures to the full
14 amount of the judgement, award, or settlement.
15 (6) In the event of judgment or award in a suit or
16 claim against a third party or insurer, the court shall
17 first order paid from any judgement or award the
18 reasonable litigation expenses incurred in preparation
19 and prosecution of the action or claim, together with
20 reasonable attorney's fees. After payment of those
21 expenses and attorney's fees, the court shall apply out
22 of the balance of the judgment or award an amount
23 sufficient to reimburse the Plan the full amount of
24 benefits paid on behalf of the covered person under this
25 Act, provided the court may reduce and apportion the
26 Plan's portion of the judgement proportionate to the
27 recovery of the covered person. The burden of producing
28 evidence sufficient to support the exercise by the court
29 of its discretion to reduce the amount of a proven charge
30 sought to be enforced against the recovery shall rest
31 with the party seeking the reduction. The court may
32 consider the nature and extent of the injury, economic
33 and non-economic loss, settlement offers, comparative
34 negligence as it applies to the case at hand, hospital
HB0673 Engrossed -22- LRB9003688JSgc
1 costs, physician costs, and all other appropriate costs.
2 The Plan shall pay its pro rata share of the attorney
3 fees based on the Plan's recovery as it compares to the
4 total judgment. Any reimbursement rights of the Plan
5 shall take priority over all other liens and charges
6 existing under the laws of this State with the exception
7 of any attorney liens filed under the Attorneys Lien Act.
8 (7) The Plan may compromise or settle and release
9 any claim for benefits provided under this Act or waive
10 any claims for benefits, in whole or in part, for the
11 convenience of the Plan or if the Plan determines that
12 collection would result in undue hardship upon the
13 covered person.
14 (Source: P.A. 89-486, eff. 6-21-96.)