Public Act 103-0094
 
SB1568 EnrolledLRB103 28639 BMS 55020 b

    AN ACT concerning regulation.
 
    Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
 
    Section 5. The Illinois Insurance Code is amended by
changing Section 370c.1 as follows:
 
    (215 ILCS 5/370c.1)
    Sec. 370c.1. Mental, emotional, nervous, or substance use
disorder or condition parity.
    (a) On and after July 23, 2021 (the effective date of
Public Act 102-135), every insurer that amends, delivers,
issues, or renews a group or individual policy of accident and
health insurance or a qualified health plan offered through
the Health Insurance Marketplace in this State providing
coverage for hospital or medical treatment and for the
treatment of mental, emotional, nervous, or substance use
disorders or conditions shall ensure prior to policy issuance
that:
        (1) the financial requirements applicable to such
    mental, emotional, nervous, or substance use disorder or
    condition benefits are no more restrictive than the
    predominant financial requirements applied to
    substantially all hospital and medical benefits covered by
    the policy and that there are no separate cost-sharing
    requirements that are applicable only with respect to
    mental, emotional, nervous, or substance use disorder or
    condition benefits; and
        (2) the treatment limitations applicable to such
    mental, emotional, nervous, or substance use disorder or
    condition benefits are no more restrictive than the
    predominant treatment limitations applied to substantially
    all hospital and medical benefits covered by the policy
    and that there are no separate treatment limitations that
    are applicable only with respect to mental, emotional,
    nervous, or substance use disorder or condition benefits.
    (b) The following provisions shall apply concerning
aggregate lifetime limits:
        (1) In the case of a group or individual policy of
    accident and health insurance or a qualified health plan
    offered through the Health Insurance Marketplace amended,
    delivered, issued, or renewed in this State on or after
    September 9, 2015 (the effective date of Public Act
    99-480) that provides coverage for hospital or medical
    treatment and for the treatment of mental, emotional,
    nervous, or substance use disorders or conditions the
    following provisions shall apply:
            (A) if the policy does not include an aggregate
        lifetime limit on substantially all hospital and
        medical benefits, then the policy may not impose any
        aggregate lifetime limit on mental, emotional,
        nervous, or substance use disorder or condition
        benefits; or
            (B) if the policy includes an aggregate lifetime
        limit on substantially all hospital and medical
        benefits (in this subsection referred to as the
        "applicable lifetime limit"), then the policy shall
        either:
                (i) apply the applicable lifetime limit both
            to the hospital and medical benefits to which it
            otherwise would apply and to mental, emotional,
            nervous, or substance use disorder or condition
            benefits and not distinguish in the application of
            the limit between the hospital and medical
            benefits and mental, emotional, nervous, or
            substance use disorder or condition benefits; or
                (ii) not include any aggregate lifetime limit
            on mental, emotional, nervous, or substance use
            disorder or condition benefits that is less than
            the applicable lifetime limit.
        (2) In the case of a policy that is not described in
    paragraph (1) of subsection (b) of this Section and that
    includes no or different aggregate lifetime limits on
    different categories of hospital and medical benefits, the
    Director shall establish rules under which subparagraph
    (B) of paragraph (1) of subsection (b) of this Section is
    applied to such policy with respect to mental, emotional,
    nervous, or substance use disorder or condition benefits
    by substituting for the applicable lifetime limit an
    average aggregate lifetime limit that is computed taking
    into account the weighted average of the aggregate
    lifetime limits applicable to such categories.
    (c) The following provisions shall apply concerning annual
limits:
        (1) In the case of a group or individual policy of
    accident and health insurance or a qualified health plan
    offered through the Health Insurance Marketplace amended,
    delivered, issued, or renewed in this State on or after
    September 9, 2015 (the effective date of Public Act
    99-480) that provides coverage for hospital or medical
    treatment and for the treatment of mental, emotional,
    nervous, or substance use disorders or conditions the
    following provisions shall apply:
            (A) if the policy does not include an annual limit
        on substantially all hospital and medical benefits,
        then the policy may not impose any annual limits on
        mental, emotional, nervous, or substance use disorder
        or condition benefits; or
            (B) if the policy includes an annual limit on
        substantially all hospital and medical benefits (in
        this subsection referred to as the "applicable annual
        limit"), then the policy shall either:
                (i) apply the applicable annual limit both to
            the hospital and medical benefits to which it
            otherwise would apply and to mental, emotional,
            nervous, or substance use disorder or condition
            benefits and not distinguish in the application of
            the limit between the hospital and medical
            benefits and mental, emotional, nervous, or
            substance use disorder or condition benefits; or
                (ii) not include any annual limit on mental,
            emotional, nervous, or substance use disorder or
            condition benefits that is less than the
            applicable annual limit.
        (2) In the case of a policy that is not described in
    paragraph (1) of subsection (c) of this Section and that
    includes no or different annual limits on different
    categories of hospital and medical benefits, the Director
    shall establish rules under which subparagraph (B) of
    paragraph (1) of subsection (c) of this Section is applied
    to such policy with respect to mental, emotional, nervous,
    or substance use disorder or condition benefits by
    substituting for the applicable annual limit an average
    annual limit that is computed taking into account the
    weighted average of the annual limits applicable to such
    categories.
    (d) With respect to mental, emotional, nervous, or
substance use disorders or conditions, an insurer shall use
policies and procedures for the election and placement of
mental, emotional, nervous, or substance use disorder or
condition treatment drugs on their formulary that are no less
favorable to the insured as those policies and procedures the
insurer uses for the selection and placement of drugs for
medical or surgical conditions and shall follow the expedited
coverage determination requirements for substance abuse
treatment drugs set forth in Section 45.2 of the Managed Care
Reform and Patient Rights Act.
    (e) This Section shall be interpreted in a manner
consistent with all applicable federal parity regulations
including, but not limited to, the Paul Wellstone and Pete
Domenici Mental Health Parity and Addiction Equity Act of
2008, final regulations issued under the Paul Wellstone and
Pete Domenici Mental Health Parity and Addiction Equity Act of
2008 and final regulations applying the Paul Wellstone and
Pete Domenici Mental Health Parity and Addiction Equity Act of
2008 to Medicaid managed care organizations, the Children's
Health Insurance Program, and alternative benefit plans.
    (f) The provisions of subsections (b) and (c) of this
Section shall not be interpreted to allow the use of lifetime
or annual limits otherwise prohibited by State or federal law.
    (g) As used in this Section:
    "Financial requirement" includes deductibles, copayments,
coinsurance, and out-of-pocket maximums, but does not include
an aggregate lifetime limit or an annual limit subject to
subsections (b) and (c).
    "Mental, emotional, nervous, or substance use disorder or
condition" means a condition or disorder that involves a
mental health condition or substance use disorder that falls
under any of the diagnostic categories listed in the mental
and behavioral disorders chapter of the current edition of the
International Classification of Disease or that is listed in
the most recent version of the Diagnostic and Statistical
Manual of Mental Disorders.
    "Treatment limitation" includes limits on benefits based
on the frequency of treatment, number of visits, days of
coverage, days in a waiting period, or other similar limits on
the scope or duration of treatment. "Treatment limitation"
includes both quantitative treatment limitations, which are
expressed numerically (such as 50 outpatient visits per year),
and nonquantitative treatment limitations, which otherwise
limit the scope or duration of treatment. A permanent
exclusion of all benefits for a particular condition or
disorder shall not be considered a treatment limitation.
"Nonquantitative treatment" means those limitations as
described under federal regulations (26 CFR 54.9812-1).
"Nonquantitative treatment limitations" include, but are not
limited to, those limitations described under federal
regulations 26 CFR 54.9812-1, 29 CFR 2590.712, and 45 CFR
146.136.
    (h) The Department of Insurance shall implement the
following education initiatives:
        (1) By January 1, 2016, the Department shall develop a
    plan for a Consumer Education Campaign on parity. The
    Consumer Education Campaign shall focus its efforts
    throughout the State and include trainings in the
    northern, southern, and central regions of the State, as
    defined by the Department, as well as each of the 5 managed
    care regions of the State as identified by the Department
    of Healthcare and Family Services. Under this Consumer
    Education Campaign, the Department shall: (1) by January
    1, 2017, provide at least one live training in each region
    on parity for consumers and providers and one webinar
    training to be posted on the Department website and (2)
    establish a consumer hotline to assist consumers in
    navigating the parity process by March 1, 2017. By January
    1, 2018 the Department shall issue a report to the General
    Assembly on the success of the Consumer Education
    Campaign, which shall indicate whether additional training
    is necessary or would be recommended.
        (2) The Department, in coordination with the
    Department of Human Services and the Department of
    Healthcare and Family Services, shall convene a working
    group of health care insurance carriers, mental health
    advocacy groups, substance abuse patient advocacy groups,
    and mental health physician groups for the purpose of
    discussing issues related to the treatment and coverage of
    mental, emotional, nervous, or substance use disorders or
    conditions and compliance with parity obligations under
    State and federal law. Compliance shall be measured,
    tracked, and shared during the meetings of the working
    group. The working group shall meet once before January 1,
    2016 and shall meet semiannually thereafter. The
    Department shall issue an annual report to the General
    Assembly that includes a list of the health care insurance
    carriers, mental health advocacy groups, substance abuse
    patient advocacy groups, and mental health physician
    groups that participated in the working group meetings,
    details on the issues and topics covered, and any
    legislative recommendations developed by the working
    group.
        (3) Not later than January 1 of each year, the
    Department, in conjunction with the Department of
    Healthcare and Family Services, shall issue a joint report
    to the General Assembly and provide an educational
    presentation to the General Assembly. The report and
    presentation shall:
            (A) Cover the methodology the Departments use to
        check for compliance with the federal Paul Wellstone
        and Pete Domenici Mental Health Parity and Addiction
        Equity Act of 2008, 42 U.S.C. 18031(j), and any
        federal regulations or guidance relating to the
        compliance and oversight of the federal Paul Wellstone
        and Pete Domenici Mental Health Parity and Addiction
        Equity Act of 2008 and 42 U.S.C. 18031(j).
            (B) Cover the methodology the Departments use to
        check for compliance with this Section and Sections
        356z.23 and 370c of this Code.
            (C) Identify market conduct examinations or, in
        the case of the Department of Healthcare and Family
        Services, audits conducted or completed during the
        preceding 12-month period regarding compliance with
        parity in mental, emotional, nervous, and substance
        use disorder or condition benefits under State and
        federal laws and summarize the results of such market
        conduct examinations and audits. This shall include:
                (i) the number of market conduct examinations
            and audits initiated and completed;
                (ii) the benefit classifications examined by
            each market conduct examination and audit;
                (iii) the subject matter of each market
            conduct examination and audit, including
            quantitative and nonquantitative treatment
            limitations; and
                (iv) a summary of the basis for the final
            decision rendered in each market conduct
            examination and audit.
            Individually identifiable information shall be
        excluded from the reports consistent with federal
        privacy protections.
            (D) Detail any educational or corrective actions
        the Departments have taken to ensure compliance with
        the federal Paul Wellstone and Pete Domenici Mental
        Health Parity and Addiction Equity Act of 2008, 42
        U.S.C. 18031(j), this Section, and Sections 356z.23
        and 370c of this Code.
            (E) The report must be written in non-technical,
        readily understandable language and shall be made
        available to the public by, among such other means as
        the Departments find appropriate, posting the report
        on the Departments' websites.
    (i) The Parity Advancement Fund is created as a special
fund in the State treasury. Moneys from fines and penalties
collected from insurers for violations of this Section shall
be deposited into the Fund. Moneys deposited into the Fund for
appropriation by the General Assembly to the Department shall
be used for the purpose of providing financial support of the
Consumer Education Campaign, parity compliance advocacy, and
other initiatives that support parity implementation and
enforcement on behalf of consumers.
    (j) The Department of Insurance and the Department of
Healthcare and Family Services shall convene and provide
technical support to a workgroup of 11 members that shall be
comprised of 3 mental health parity experts recommended by an
organization advocating on behalf of mental health parity
appointed by the President of the Senate; 3 behavioral health
providers recommended by an organization that represents
behavioral health providers appointed by the Speaker of the
House of Representatives; 2 representing Medicaid managed care
organizations recommended by an organization that represents
Medicaid managed care plans appointed by the Minority Leader
of the House of Representatives; 2 representing commercial
insurers recommended by an organization that represents
insurers appointed by the Minority Leader of the Senate; and a
representative of an organization that represents Medicaid
managed care plans appointed by the Governor.
    The workgroup shall provide recommendations to the General
Assembly on health plan data reporting requirements that
separately break out data on mental, emotional, nervous, or
substance use disorder or condition benefits and data on other
medical benefits, including physical health and related health
services no later than December 31, 2019. The recommendations
to the General Assembly shall be filed with the Clerk of the
House of Representatives and the Secretary of the Senate in
electronic form only, in the manner that the Clerk and the
Secretary shall direct. This workgroup shall take into account
federal requirements and recommendations on mental health
parity reporting for the Medicaid program. This workgroup
shall also develop the format and provide any needed
definitions for reporting requirements in subsection (k). The
research and evaluation of the working group shall include,
but not be limited to:
        (1) claims denials due to benefit limits, if
    applicable;
        (2) administrative denials for no prior authorization;
        (3) denials due to not meeting medical necessity;
        (4) denials that went to external review and whether
    they were upheld or overturned for medical necessity;
        (5) out-of-network claims;
        (6) emergency care claims;
        (7) network directory providers in the outpatient
    benefits classification who filed no claims in the last 6
    months, if applicable;
        (8) the impact of existing and pertinent limitations
    and restrictions related to approved services, licensed
    providers, reimbursement levels, and reimbursement
    methodologies within the Division of Mental Health, the
    Division of Substance Use Prevention and Recovery
    programs, the Department of Healthcare and Family
    Services, and, to the extent possible, federal regulations
    and law; and
        (9) when reporting and publishing should begin.
    Representatives from the Department of Healthcare and
Family Services, representatives from the Division of Mental
Health, and representatives from the Division of Substance Use
Prevention and Recovery shall provide technical advice to the
workgroup.
    (j-5) The Department of Insurance shall collect the
following information:
        (1) The number of employment disability insurance
    plans offered in this State, including, but not limited
    to:
            (A) individual short-term policies;
            (B) individual long-term policies;
            (C) group short-term policies; and
            (D) group long-term policies.
        (2) The number of policies referenced in paragraph (1)
    of this subsection that limit mental health and substance
    use disorder benefits.
        (3) The average defined benefit period for the
    policies referenced in paragraph (1) of this subsection,
    both for those policies that limit and those policies that
    have no limitation on mental health and substance use
    disorder benefits.
        (4) Whether the policies referenced in paragraph (1)
    of this subsection are purchased on a voluntary or
    non-voluntary basis.
        (5) The identities of the individuals, entities, or a
    combination of the 2, that assume the cost associated with
    covering the policies referenced in paragraph (1) of this
    subsection.
        (6) The average defined benefit period for plans that
    cover physical disability and mental health and substance
    abuse without limitation, including, but not limited to:
            (A) individual short-term policies;
            (B) individual long-term policies;
            (C) group short-term policies; and
            (D) group long-term policies.
        (7) The average premiums for disability income
    insurance issued in this State for:
            (A) individual short-term policies that limit
        mental health and substance use disorder benefits;
            (B) individual long-term policies that limit
        mental health and substance use disorder benefits;
            (C) group short-term policies that limit mental
        health and substance use disorder benefits;
            (D) group long-term policies that limit mental
        health and substance use disorder benefits;
            (E) individual short-term policies that include
        mental health and substance use disorder benefits
        without limitation;
            (F) individual long-term policies that include
        mental health and substance use disorder benefits
        without limitation;
            (G) group short-term policies that include mental
        health and substance use disorder benefits without
        limitation; and
            (H) group long-term policies that include mental
        health and substance use disorder benefits without
        limitation.
    The Department shall present its findings regarding
information collected under this subsection (j-5) to the
General Assembly no later than April 30, 2024. Information
regarding a specific insurance provider's contributions to the
Department's report shall be exempt from disclosure under
paragraph (t) of subsection (1) of Section 7 of the Freedom of
Information Act. The aggregated information gathered by the
Department shall not be exempt from disclosure under paragraph
(t) of subsection (1) of Section 7 of the Freedom of
Information Act.
    (k) An insurer that amends, delivers, issues, or renews a
group or individual policy of accident and health insurance or
a qualified health plan offered through the health insurance
marketplace in this State providing coverage for hospital or
medical treatment and for the treatment of mental, emotional,
nervous, or substance use disorders or conditions shall submit
an annual report, the format and definitions for which will be
developed by the workgroup in subsection (j), to the
Department, or, with respect to medical assistance, the
Department of Healthcare and Family Services starting on or
before July 1, 2020 that contains the following information
separately for inpatient in-network benefits, inpatient
out-of-network benefits, outpatient in-network benefits,
outpatient out-of-network benefits, emergency care benefits,
and prescription drug benefits in the case of accident and
health insurance or qualified health plans, or inpatient,
outpatient, emergency care, and prescription drug benefits in
the case of medical assistance:
        (1) A summary of the plan's pharmacy management
    processes for mental, emotional, nervous, or substance use
    disorder or condition benefits compared to those for other
    medical benefits.
        (2) A summary of the internal processes of review for
    experimental benefits and unproven technology for mental,
    emotional, nervous, or substance use disorder or condition
    benefits and those for other medical benefits.
        (3) A summary of how the plan's policies and
    procedures for utilization management for mental,
    emotional, nervous, or substance use disorder or condition
    benefits compare to those for other medical benefits.
        (4) A description of the process used to develop or
    select the medical necessity criteria for mental,
    emotional, nervous, or substance use disorder or condition
    benefits and the process used to develop or select the
    medical necessity criteria for medical and surgical
    benefits.
        (5) Identification of all nonquantitative treatment
    limitations that are applied to both mental, emotional,
    nervous, or substance use disorder or condition benefits
    and medical and surgical benefits within each
    classification of benefits.
        (6) The results of an analysis that demonstrates that
    for the medical necessity criteria described in
    subparagraph (A) and for each nonquantitative treatment
    limitation identified in subparagraph (B), as written and
    in operation, the processes, strategies, evidentiary
    standards, or other factors used in applying the medical
    necessity criteria and each nonquantitative treatment
    limitation to mental, emotional, nervous, or substance use
    disorder or condition benefits within each classification
    of benefits are comparable to, and are applied no more
    stringently than, the processes, strategies, evidentiary
    standards, or other factors used in applying the medical
    necessity criteria and each nonquantitative treatment
    limitation to medical and surgical benefits within the
    corresponding classification of benefits; at a minimum,
    the results of the analysis shall:
            (A) identify the factors used to determine that a
        nonquantitative treatment limitation applies to a
        benefit, including factors that were considered but
        rejected;
            (B) identify and define the specific evidentiary
        standards used to define the factors and any other
        evidence relied upon in designing each nonquantitative
        treatment limitation;
            (C) provide the comparative analyses, including
        the results of the analyses, performed to determine
        that the processes and strategies used to design each
        nonquantitative treatment limitation, as written, for
        mental, emotional, nervous, or substance use disorder
        or condition benefits are comparable to, and are
        applied no more stringently than, the processes and
        strategies used to design each nonquantitative
        treatment limitation, as written, for medical and
        surgical benefits;
            (D) provide the comparative analyses, including
        the results of the analyses, performed to determine
        that the processes and strategies used to apply each
        nonquantitative treatment limitation, in operation,
        for mental, emotional, nervous, or substance use
        disorder or condition benefits are comparable to, and
        applied no more stringently than, the processes or
        strategies used to apply each nonquantitative
        treatment limitation, in operation, for medical and
        surgical benefits; and
            (E) disclose the specific findings and conclusions
        reached by the insurer that the results of the
        analyses described in subparagraphs (C) and (D)
        indicate that the insurer is in compliance with this
        Section and the Mental Health Parity and Addiction
        Equity Act of 2008 and its implementing regulations,
        which includes 42 CFR Parts 438, 440, and 457 and 45
        CFR 146.136 and any other related federal regulations
        found in the Code of Federal Regulations.
        (7) Any other information necessary to clarify data
    provided in accordance with this Section requested by the
    Director, including information that may be proprietary or
    have commercial value, under the requirements of Section
    30 of the Viatical Settlements Act of 2009.
    (l) An insurer that amends, delivers, issues, or renews a
group or individual policy of accident and health insurance or
a qualified health plan offered through the health insurance
marketplace in this State providing coverage for hospital or
medical treatment and for the treatment of mental, emotional,
nervous, or substance use disorders or conditions on or after
January 1, 2019 (the effective date of Public Act 100-1024)
shall, in advance of the plan year, make available to the
Department or, with respect to medical assistance, the
Department of Healthcare and Family Services and to all plan
participants and beneficiaries the information required in
subparagraphs (C) through (E) of paragraph (6) of subsection
(k). For plan participants and medical assistance
beneficiaries, the information required in subparagraphs (C)
through (E) of paragraph (6) of subsection (k) shall be made
available on a publicly-available website whose web address is
prominently displayed in plan and managed care organization
informational and marketing materials.
    (m) In conjunction with its compliance examination program
conducted in accordance with the Illinois State Auditing Act,
the Auditor General shall undertake a review of compliance by
the Department and the Department of Healthcare and Family
Services with Section 370c and this Section. Any findings
resulting from the review conducted under this Section shall
be included in the applicable State agency's compliance
examination report. Each compliance examination report shall
be issued in accordance with Section 3-14 of the Illinois
State Auditing Act. A copy of each report shall also be
delivered to the head of the applicable State agency and
posted on the Auditor General's website.
(Source: P.A. 102-135, eff. 7-23-21; 102-579, eff. 8-25-21;
102-813, eff. 5-13-22.)

Effective Date: 1/1/2024