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Public Act 097-0142


 

Public Act 0142 97TH GENERAL ASSEMBLY

  
  
  

 


 
Public Act 097-0142
 
SB1555 EnrolledLRB097 05655 RPM 45717 b

    AN ACT concerning insurance.
 
    Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
 
ARTICLE 5.
ILLINOIS HEALTH BENEFITS EXCHANGE

 
    Section 5-1. Short title. This Article may be cited as the
Illinois Health Benefits Exchange Law.
 
    Section 5-3. Legislative intent. The General Assembly
finds the health benefits exchanges authorized by the federal
Patient Protection and Affordable Care Act represent one of a
number of ways in which the State can address coverage gaps and
provide individual consumers and small employers access to
greater coverage options. The General Assembly also finds that
the State is best positioned to implement an exchange that is
sensitive to the coverage gaps and market landscape unique to
this State.
    The purpose of this Law is to ensure that the State is
making sufficient progress towards establishing an exchange
within the guidelines outlined by the federal law and to
protect Illinoisans from undue federal regulation. Although
the federal law imposes a number of core requirements on
state-level exchanges, the State has significant flexibility
in the design and operation of a State exchange that make it
prudent for the State to carefully analyze, plan, and prepare
for the exchange. The General Assembly finds that in order for
the State to craft a tenable exchange that meets the
fundamental goals outlined by the Patient Protection and
Affordable Care Act of expanding access to affordable coverage
and improving the quality of care, the implementation process
should (1) provide for broad stakeholder representation; (2)
foster a robust and competitive marketplace, both inside and
outside of the exchange; and (3) provide for a broad-based
approach to the fiscal solvency of the exchange.
 
    Section 5-5. State health benefits exchange. It is
declared that this State, beginning October 1, 2013, in
accordance with Section 1311 of the federal Patient Protection
and Affordable Care Act, shall establish a State health
benefits exchange to be known as the Illinois Health Benefits
Exchange in order to help individuals and small employers with
no more than 50 employees shop for, select, and enroll in
qualified, affordable private health plans that fit their needs
at competitive prices. The Exchange shall separate coverage
pools for individuals and small employers and shall supplement
and not supplant any existing private health insurance market
for individuals and small employers.
 
    Section 5-10. Exchange functions.
    (a) The Illinois Health Benefits Exchange shall meet the
core functions identified by Section 1311 of the Patient
Protection and Affordable Care Act and subsequent federal
guidance and regulations.
    (b) In order to meet the deadline of October 1, 2013
established by federal law to have operational a State
exchange, the Department of Insurance and the Commission on
Governmental Forecasting and Accountability is authorized to
apply for, accept, receive, and use as appropriate for and on
behalf of the State any grant money provided by the federal
government and to share federal grant funding with, give
support to, and coordinate with other agencies of the State and
federal government or third parties as determined by the
Governor.
 
    Section 5-15. Illinois Health Benefits Exchange
Legislative Study Committee.
    (a) There is created an Illinois Health Benefits Exchange
Legislative Study Committee to conduct a study regarding State
implementation and establishment of the Illinois Health
Benefits Exchange.
    (b) Members of the Legislative Study Committee shall be
appointed as follows: 3 members of the Senate shall be
appointed by the President of the Senate; 3 members of the
Senate shall be appointed by the Minority Leader of the Senate;
3 members of the House of Representatives shall be appointed by
the Speaker of the House of Representatives; and 3 members of
the House of Representatives shall be appointed by the Minority
Leader of the House of Representatives. Each legislative leader
shall select one member to serve as co-chair of the committee.
    (c) Members of the Legislative Study Committee shall be
appointed within 30 days after the effective date of this Law.
The co-chairs shall convene the first meeting of the committee
no later than 45 days after the effective date of this Law.
 
    Section 5-20. Committee study. No later than September 30,
2011, the Committee shall report all findings concerning the
implementation and establishment of the Illinois Health
Benefits Exchange to the executive and legislative branches,
including, but not limited to, (1) the governance and structure
of the Exchange, (2) financial sustainability of the Exchange,
and (3) stakeholder engagement, including an ongoing role for
the Legislative Study Committee or other legislative oversight
of the Exchange. The Committee shall report its findings with
regard to (A) the operating model of the Exchange, (B) the size
of the employers to be offered coverage through the Exchange,
(C) coverage pools for individuals and businesses within the
Exchange, and (D) the development of standards for the coverage
of full-time and part-time employees and their dependents. The
Committee study shall also include recommendations concerning
prospective action on behalf of the General Assembly as it
relates to the establishment of the Exchange in 2011, 2012,
2013, and 2014.
 
    Section 5-25. Federal action. This Law shall be null and
void if Congress and the President take action to repeal or
replace, or both, Section 1311 of the Affordable Care Act.
 
ARTICLE 10.
HEALTH SAVINGS ACCOUNT

 
    Section 10-1. Short title. This Article may be cited as
the State Employee Health Savings Account Law.
 
    Section 10-5. Definitions. As used in this Law:
    (a) "Deductible" means the total deductible of a high
deductible health plan for an eligible individual and all the
dependents of that eligible individual for a calendar year.
    (b) "Dependent" means an eligible individual's spouse or
child, as defined in Section 152 of the Internal Revenue Code
of 1986. "Dependent" includes a party to a civil union, as
defined under Section 10 of the Illinois Religious Freedom
Protection and Civil Union Act.
    (c) "Eligible individual" means an employee, as defined in
Section 3 of the State Employees Group Insurance Act of 1971,
who contributes to health savings accounts on the employees'
behalf, who:
        (1) is covered by a high deductible health plan
    individually or with dependents; and
        (2) is not covered under any health plan that is not a
    high deductible health plan, except for:
            (i) coverage for accidents;
            (ii) workers' compensation insurance;
            (iii) insurance for a specified disease or
        illness;
            (iv) insurance paying a fixed amount per day per
        hospitalization; and
            (v) tort liabilities; and
        (3) establishes a health savings account or on whose
    behalf the health savings account is established.
    (d) "Employer" means a State agency, department, or other
entity that employs an eligible individual.
    (e) "Health savings account" or "account" means a trust or
custodial account established under a State program
exclusively to pay the qualified medical expenses of an
eligible individual, or his or her dependents, that meets all
of the following requirements:
        (1) Except in the case of a rollover contribution, no
    contribution may be accepted:
            (A) unless it is in cash; or
            (B) to the extent that the contribution, when added
        to the previous contributions to the Account for the
        calendar year, exceeds the lesser of (i) 100% of the
        eligible individual's deductible or (ii) the
        contribution level set for that year by the Internal
        Revenue Service.
        (2) The trustee or custodian is a bank, an insurance
    company, or another person approved by the Director of
    Insurance.
        (3) No part of the trust assets shall be invested in
    life insurance contracts.
        (4) The assets of the account shall not be commingled
    with other property except as allowed for under Individual
    Retirement Accounts.
        (5) Eligible individual's interest in the account is
    nonforfeitable.
    (f) "Health savings account program" or "program" means a
program that includes all of the following:
        (1) The purchase by an eligible individual or by an
    employer of a high deductible health plan.
        (2) The contribution into a health savings account by
    an eligible individual or on behalf of an employee or by
    his or her employer. The total annual contribution may not
    exceed the amount of the deductible or the amounts listed
    in sub-item (B) of item (1) of subsection (f) of this
    Section.
    (g) "High deductible" means:
        (1) In the case of self-only coverage, an annual
    deductible that is not less than the level set by the
    Internal Revenue Service and that, when added to the other
    annual out-of-pocket expenses required to be paid under the
    plan for covered benefits, does not exceed $5,000; and
        (2) In the case of family coverage, an annual
    deductible of not less than the level set by the Internal
    Revenue Service and that, when added to the other annual
    out-of-pocket expenses required to be paid under the plan
    for covered benefits, does not exceed $10,000.
    A plan shall not fail to be treated as a high deductible
plan by reason of a failure to have a deductible for preventive
care or, in the case of network plans, for having out-of-pocket
expenses that exceed these limits on an annual deductible for
services that are provided outside the network.
    (h) "High deductible health plan" means a health coverage
policy, certificate, or contract that provides for payments for
covered benefits that exceed the high deductible.
    (i) "Qualified medical expense" means an expense paid by
the eligible individual for medical care described in Section
213(d) of the Internal Revenue Code of 1986.
 
    Section 10-10. Application; authorized contributions.
    (a) Beginning in taxable year 2011, each employer shall
make available to each eligible individual a health savings
account program, if that individual chooses to enroll in the
program. An employer shall deposit $2,750 annually into an
eligible individual's health savings account. Unused funds in a
health savings account shall become the property of the account
holder at the end of a taxable year.
    (b) Beginning in taxable year 2011, an eligible individual
may deposit contributions into a health savings account. The
amount of deposit may not exceed the amount of the deductible
for the policy.
 
    Section 10-15. Use of funds.
    (a) The trustee or custodian must use the funds held in a
health savings account solely (i) for the purpose of paying the
qualified medical expenses of the eligible individual or his or
her dependents, (ii) to purchase a health coverage policy,
certificate, or contract, or (iii) to pay for health insurance
other than a Medicare supplemental policy for those who are
Medicare eligible.
    (b) Funds held in a health savings account may not be used
to cover expenses of the eligible individual or his or her
dependents that are otherwise covered, including, but not
limited to, medical expense covered under an automobile
insurance policy, worker's compensation insurance policy or
self-insured plan, or another employer-funded health coverage
policy, certificate, or contract.
 
ARTICLE 90.
AMENDATORY PROVISIONS

 
    (20 ILCS 4045/Act rep.)
    Section 90-10. The Health Care Justice Act is repealed.
 
ARTICLE 99.
EFFECTIVE DATE

 
    Section 99. Effective date. This Act takes effect upon
becoming law.

Effective Date: 7/14/2011