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92_HB3400 LRB9205494JSpc 1 AN ACT concerning liability for the provision of health 2 care. 3 Be it enacted by the People of the State of Illinois, 4 represented in the General Assembly: 5 Section 1. Short title. This Act may be cited as the 6 Health Care Entity Liability Act. 7 Section 5. Definitions. In this Act: 8 "Appropriate and medically necessary" means the standard 9 for health care services as determined by physicians and 10 health care providers in accordance with the prevailing 11 practices and standards of the medical profession and 12 community. 13 "Enrollee" means an individual who is enrolled in a 14 health care plan, including covered dependents. 15 "Health care plan" means any plan whereby any person 16 undertakes to provide, arrange for, pay for, or reimburse any 17 part of the cost of any health care services. 18 "Health care provider" means a person or entity as 19 defined in Section 2-1003 of the Code of Civil Procedure. 20 "Health care treatment decision" means a determination 21 made when medical services are actually provided by the 22 health care plan and a decision that affects the quality of 23 the diagnosis, care, or treatment provided to the plan's 24 insureds or enrollees. 25 "Health insurance carrier" means an authorized insurance 26 company that issues policies of accident and health insurance 27 under the Illinois Insurance Code. 28 "Health maintenance organization" means an organization 29 licensed under the Health Maintenance Organization Act. 30 "Managed care entity" means any entity that delivers, 31 administers, or assumes risk for health care services with -2- LRB9205494JSpc 1 systems or techniques to control or influence the quality, 2 accessibility, utilization, or costs and prices of those 3 services to a defined enrollee population, but does not 4 include an employer acting on behalf of its employees or the 5 employees of one or more subsidiaries or affiliated 6 corporations of the employer. 7 "Physician" means: (1) an individual licensed to practice 8 medicine in this State; (2) a professional association, 9 professional service corporation, partnership, medical 10 corporation, or limited liability company, entitled to 11 lawfully engage in the practice of medicine; or (3) another 12 person wholly owned by physicians. 13 "Ordinary care" means, in the case of a health insurance 14 carrier, health maintenance organization, or managed care 15 entity, that degree of care that a health insurance carrier, 16 health maintenance organization, or managed care entity of 17 ordinary prudence would use under the same or similar 18 circumstances. In the case of a person who is an employee, 19 agent, ostensible agent, or representative of a health 20 insurance carrier, health maintenance organization, or 21 managed care entity, "ordinary care" means that degree of 22 care that a person of ordinary prudence in the same 23 profession, specialty, or area of practice as such person 24 would use in the same or similar circumstances. 25 Section 10. Duty of care; liability; applicability. 26 (a) A health insurance carrier, health maintenance 27 organization, or other managed care entity for a health care 28 plan has the duty to exercise ordinary care when making 29 health care treatment decisions and is liable for damages for 30 harm to an insured or enrollee proximately caused by its 31 failure to exercise such ordinary care. 32 (b) A health insurance carrier, health maintenance 33 organization, or other managed care entity for a health care -3- LRB9205494JSpc 1 plan is also liable for damages for harm to an insured or 2 enrollee proximately caused by the health care treatment 3 decisions made by its: 4 (1) employees; 5 (2) agents; 6 (3) ostensible agents; or 7 (4) representatives who are acting on its behalf 8 and over whom it has the right to exercise influence or 9 control or has actually exercised influence or control 10 that results in the failure to exercise ordinary care. 11 (c) The standards in subsections (a) and (b) create no 12 obligation on the part of the health insurance carrier, 13 health maintenance organization, or other managed care entity 14 to provide to an insured or enrollee treatment that is not 15 covered by the health care plan of the entity. 16 (d) A health insurance carrier, health maintenance 17 organization, or managed care entity may not remove a 18 physician or health care provider from its plan or refuse to 19 renew the physician or health care provider with its plan for 20 advocating on behalf of an enrollee for appropriate and 21 medically necessary health care for the enrollee. 22 (e) A health insurance carrier, health maintenance 23 organization, or other managed care entity may not enter into 24 a contract with a physician, hospital, or other health care 25 provider or pharmaceutical company which includes an 26 indemnification or hold harmless clause for the acts or 27 conduct of the health insurance carrier, health maintenance 28 organization, or other managed care entity. Any such 29 indemnification or hold harmless clause in an existing 30 contract is hereby declared void. 31 (f) Nothing in any law of this State prohibiting a 32 health insurance carrier, health maintenance organization, or 33 other managed care entity from practicing medicine or being 34 licensed to practice medicine may be asserted as a defense by -4- LRB9205494JSpc 1 the health insurance carrier, health maintenance 2 organization, or other managed care entity in an action 3 brought against it pursuant to this Section or any other law. 4 (g) In an action against a health insurance carrier, 5 health maintenance organization, or managed care entity, a 6 finding that a physician or other health care provider is an 7 employee, agent, ostensible agent, or representative of the 8 health insurance carrier, health maintenance organization, or 9 managed care entity shall not be based solely on proof that 10 the person's name appears in a listing of approved physicians 11 or health care providers made available to insureds or 12 enrollees under a health care plan. 13 (h) This Act does not apply to workers' compensation 14 insurance coverage subject to the Workers' Compensation Act. 15 (i) This Act applies only causes of action that accrue 16 on or after the effective date of this Act. 17 Section 15. Determination of medical necessity; 18 liability. 19 (a) The determination of whether a procedure or 20 treatment is medically necessary must be made by a physician. 21 (b) If the physician determines that a procedure or 22 treatment is medically necessary, the health care plan must 23 pay for the procedure or treatment. 24 Section 99. Effective date. This Act takes effect upon 25 becoming law.
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