103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
SB1762

 

Introduced 2/9/2023, by Sen. Ann Gillespie

 

SYNOPSIS AS INTRODUCED:
 
215 ILCS 5/356z.3
215 ILCS 5/356z.3a
215 ILCS 125/4.5-1

    Amends the Illinois Insurance Code. In provisions concerning required disclosures on contracts and evidences of coverage of accident and health insurance, provides that insurers must notify beneficiaries that nonparticipating providers may bill members for any amount up to the billed charge after the plan has paid its portion of the bill, except for specified services, including items or services provided to a Medicare beneficiary, insured, or enrollee. Provides that a health care provider shall not charge or collect from a Medicare beneficiary, insured, or enrollee any amount in excess of the Medicare-approved amount for any Medicare-covered item or service provided, and provides that the Department of Insurance has the authority to enforce that requirement. Defines terms. Makes a conforming change in the Health Maintenance Organization Act. Effective immediately.


LRB103 05845 BMS 50865 b

 

 

A BILL FOR

 

SB1762LRB103 05845 BMS 50865 b

1    AN ACT concerning regulation.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Insurance Code is amended by
5changing Sections 356z.3 and 356z.3a as follows:
 
6    (215 ILCS 5/356z.3)
7    Sec. 356z.3. Disclosure of limited benefit. An insurer
8that issues, delivers, amends, or renews an individual or
9group policy of accident and health insurance in this State
10after the effective date of this amendatory Act of the 92nd
11General Assembly and arranges, contracts with, or administers
12contracts with a provider whereby beneficiaries are provided
13an incentive to use the services of such provider must include
14the following disclosure on its contracts and evidences of
15coverage: "WARNING, LIMITED BENEFITS WILL BE PAID WHEN
16NON-PARTICIPATING PROVIDERS ARE USED. You should be aware that
17when you elect to utilize the services of a non-participating
18provider for a covered service in non-emergency situations,
19benefit payments to such non-participating provider are not
20based upon the amount billed. The basis of your benefit
21payment will be determined according to your policy's fee
22schedule, usual and customary charge (which is determined by
23comparing charges for similar services adjusted to the

 

 

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1geographical area where the services are performed), or other
2method as defined by the policy. YOU CAN EXPECT TO PAY MORE
3THAN THE COINSURANCE AMOUNT DEFINED IN THE POLICY AFTER THE
4PLAN HAS PAID ITS REQUIRED PORTION. Non-participating
5providers may bill members for any amount up to the billed
6charge after the plan has paid its portion of the bill, except
7as provided in Section 356z.3a of the Illinois Insurance Code
8for covered services received at a participating health care
9facility from a nonparticipating provider that are: (a)
10ancillary services, (b) items or services furnished as a
11result of unforeseen, urgent medical needs that arise at the
12time the item or service is furnished, or (c) items or services
13received when the facility or the non-participating provider
14fails to satisfy the notice and consent criteria specified
15under Section 356z.3a, or (d) items or services provided to a
16Medicare beneficiary, insured, or enrollee. Participating
17providers have agreed to accept discounted payments for
18services with no additional billing to the member other than
19co-insurance and deductible amounts. You may obtain further
20information about the participating status of professional
21providers and information on out-of-pocket expenses by calling
22the toll free telephone number on your identification card.".
23(Source: P.A. 102-901, eff. 1-1-23.)
 
24    (215 ILCS 5/356z.3a)
25    Sec. 356z.3a. Billing; emergency services;

 

 

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1nonparticipating providers.
2    (a) As used in this Section:
3    "Ancillary services" means:
4        (1) items and services related to emergency medicine,
5    anesthesiology, pathology, radiology, and neonatology that
6    are provided by any health care provider;
7        (2) items and services provided by assistant surgeons,
8    hospitalists, and intensivists;
9        (3) diagnostic services, including radiology and
10    laboratory services, except for advanced diagnostic
11    laboratory tests identified on the most current list
12    published by the United States Secretary of Health and
13    Human Services under 42 U.S.C. 300gg-132(b)(3);
14        (4) items and services provided by other specialty
15    practitioners as the United States Secretary of Health and
16    Human Services specifies through rulemaking under 42
17    U.S.C. 300gg-132(b)(3); and
18        (5) items and services provided by a nonparticipating
19    provider if there is no participating provider who can
20    furnish the item or service at the facility.
21    "Cost sharing" means the amount an insured, beneficiary,
22or enrollee is responsible for paying for a covered item or
23service under the terms of the policy or certificate. "Cost
24sharing" includes copayments, coinsurance, and amounts paid
25toward deductibles, but does not include amounts paid towards
26premiums, balance billing by out-of-network providers, or the

 

 

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1cost of items or services that are not covered under the policy
2or certificate.
3    "Emergency department of a hospital" means any hospital
4department that provides emergency services, including a
5hospital outpatient department.
6    "Emergency medical condition" has the meaning ascribed to
7that term in Section 10 of the Managed Care Reform and Patient
8Rights Act.
9    "Emergency medical screening examination" has the meaning
10ascribed to that term in Section 10 of the Managed Care Reform
11and Patient Rights Act.
12    "Emergency services" means, with respect to an emergency
13medical condition:
14        (1) in general, an emergency medical screening
15    examination, including ancillary services routinely
16    available to the emergency department to evaluate such
17    emergency medical condition, and such further medical
18    examination and treatment as would be required to
19    stabilize the patient regardless of the department of the
20    hospital or other facility in which such further
21    examination or treatment is furnished; or
22        (2) additional items and services for which benefits
23    are provided or covered under the coverage and that are
24    furnished by a nonparticipating provider or
25    nonparticipating emergency facility regardless of the
26    department of the hospital or other facility in which such

 

 

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1    items are furnished after the insured, beneficiary, or
2    enrollee is stabilized and as part of outpatient
3    observation or an inpatient or outpatient stay with
4    respect to the visit in which the services described in
5    paragraph (1) are furnished. Services after stabilization
6    cease to be emergency services only when all the
7    conditions of 42 U.S.C. 300gg-111(a)(3)(C)(ii)(II) and
8    regulations thereunder are met.
9    "Freestanding Emergency Center" means a facility licensed
10under Section 32.5 of the Emergency Medical Services (EMS)
11Systems Act.
12    "Health care facility" means, in the context of
13non-emergency services, any of the following:
14        (1) a hospital as defined in 42 U.S.C. 1395x(e);
15        (2) a hospital outpatient department;
16        (3) a critical access hospital certified under 42
17    U.S.C. 1395i-4(e);
18        (4) an ambulatory surgical treatment center as defined
19    in the Ambulatory Surgical Treatment Center Act; or
20        (5) any recipient of a license under the Hospital
21    Licensing Act that is not otherwise described in this
22    definition.
23    "Health care provider" means a provider as defined in
24subsection (d) of Section 370g. "Health care provider" does
25not include a provider of air ambulance or ground ambulance
26services.

 

 

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1    "Health care services" has the meaning ascribed to that
2term in subsection (a) of Section 370g.
3    "Health insurance issuer" has the meaning ascribed to that
4term in Section 5 of the Illinois Health Insurance Portability
5and Accountability Act.
6    "Medicare" means the health insurance program for the aged
7and disabled under Title XVIII of the Social Security Act.
8    "Medicare-approved amount" means the total payment that
9Medicare has agreed to pay a health care provider for a service
10or item.
11    "Nonparticipating emergency facility" means, with respect
12to the furnishing of an item or service under a policy of group
13or individual health insurance coverage, any of the following
14facilities that does not have a contractual relationship
15directly or indirectly with a health insurance issuer in
16relation to the coverage:
17        (1) an emergency department of a hospital;
18        (2) a Freestanding Emergency Center;
19        (3) an ambulatory surgical treatment center as defined
20    in the Ambulatory Surgical Treatment Center Act; or
21        (4) with respect to emergency services described in
22    paragraph (2) of the definition of "emergency services", a
23    hospital.
24    "Nonparticipating provider" means, with respect to the
25furnishing of an item or service under a policy of group or
26individual health insurance coverage, any health care provider

 

 

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1who does not have a contractual relationship directly or
2indirectly with a health insurance issuer in relation to the
3coverage.
4    "Participating emergency facility" means any of the
5following facilities that has a contractual relationship
6directly or indirectly with a health insurance issuer offering
7group or individual health insurance coverage setting forth
8the terms and conditions on which a relevant health care
9service is provided to an insured, beneficiary, or enrollee
10under the coverage:
11        (1) an emergency department of a hospital;
12        (2) a Freestanding Emergency Center;
13        (3) an ambulatory surgical treatment center as defined
14    in the Ambulatory Surgical Treatment Center Act; or
15        (4) with respect to emergency services described in
16    paragraph (2) of the definition of "emergency services", a
17    hospital.
18    For purposes of this definition, a single case agreement
19between an emergency facility and an issuer that is used to
20address unique situations in which an insured, beneficiary, or
21enrollee requires services that typically occur out-of-network
22constitutes a contractual relationship and is limited to the
23parties to the agreement.
24    "Participating health care facility" means any health care
25facility that has a contractual relationship directly or
26indirectly with a health insurance issuer offering group or

 

 

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1individual health insurance coverage setting forth the terms
2and conditions on which a relevant health care service is
3provided to an insured, beneficiary, or enrollee under the
4coverage. A single case agreement between an emergency
5facility and an issuer that is used to address unique
6situations in which an insured, beneficiary, or enrollee
7requires services that typically occur out-of-network
8constitutes a contractual relationship for purposes of this
9definition and is limited to the parties to the agreement.
10    "Participating provider" means any health care provider
11that has a contractual relationship directly or indirectly
12with a health insurance issuer offering group or individual
13health insurance coverage setting forth the terms and
14conditions on which a relevant health care service is provided
15to an insured, beneficiary, or enrollee under the coverage.
16    "Qualifying payment amount" has the meaning given to that
17term in 42 U.S.C. 300gg-111(a)(3)(E) and the regulations
18promulgated thereunder.
19    "Recognized amount" means the lesser of the amount
20initially billed by the provider or the qualifying payment
21amount.
22    "Stabilize" means "stabilization" as defined in Section 10
23of the Managed Care Reform and Patient Rights Act.
24    "Treating provider" means a health care provider who has
25evaluated the individual.
26    "Visit" means, with respect to health care services

 

 

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1furnished to an individual at a health care facility, health
2care services furnished by a provider at the facility, as well
3as equipment, devices, telehealth services, imaging services,
4laboratory services, and preoperative and postoperative
5services regardless of whether the provider furnishing such
6services is at the facility.
7    (b) Emergency services. When a beneficiary, insured, or
8enrollee receives emergency services from a nonparticipating
9provider or a nonparticipating emergency facility, the health
10insurance issuer shall ensure that the beneficiary, insured,
11or enrollee shall incur no greater out-of-pocket costs than
12the beneficiary, insured, or enrollee would have incurred with
13a participating provider or a participating emergency
14facility. Any cost-sharing requirements shall be applied as
15though the emergency services had been received from a
16participating provider or a participating facility. Cost
17sharing shall be calculated based on the recognized amount for
18the emergency services. If the cost sharing for the same item
19or service furnished by a participating provider would have
20been a flat-dollar copayment, that amount shall be the
21cost-sharing amount unless the provider has billed a lesser
22total amount. In no event shall the beneficiary, insured,
23enrollee, or any group policyholder or plan sponsor be liable
24to or billed by the health insurance issuer, the
25nonparticipating provider, or the nonparticipating emergency
26facility for any amount beyond the cost sharing calculated in

 

 

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1accordance with this subsection with respect to the emergency
2services delivered. Administrative requirements or limitations
3shall be no greater than those applicable to emergency
4services received from a participating provider or a
5participating emergency facility.
6    (b-5) Non-emergency services at participating health care
7facilities.
8        (1) When a beneficiary, insured, or enrollee utilizes
9    a participating health care facility and, due to any
10    reason, covered ancillary services are provided by a
11    nonparticipating provider during or resulting from the
12    visit, the health insurance issuer shall ensure that the
13    beneficiary, insured, or enrollee shall incur no greater
14    out-of-pocket costs than the beneficiary, insured, or
15    enrollee would have incurred with a participating provider
16    for the ancillary services. Any cost-sharing requirements
17    shall be applied as though the ancillary services had been
18    received from a participating provider. Cost sharing shall
19    be calculated based on the recognized amount for the
20    ancillary services. If the cost sharing for the same item
21    or service furnished by a participating provider would
22    have been a flat-dollar copayment, that amount shall be
23    the cost-sharing amount unless the provider has billed a
24    lesser total amount. In no event shall the beneficiary,
25    insured, enrollee, or any group policyholder or plan
26    sponsor be liable to or billed by the health insurance

 

 

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1    issuer, the nonparticipating provider, or the
2    participating health care facility for any amount beyond
3    the cost sharing calculated in accordance with this
4    subsection with respect to the ancillary services
5    delivered. In addition to ancillary services, the
6    requirements of this paragraph shall also apply with
7    respect to covered items or services furnished as a result
8    of unforeseen, urgent medical needs that arise at the time
9    an item or service is furnished, regardless of whether the
10    nonparticipating provider satisfied the notice and consent
11    criteria under paragraph (2) of this subsection.
12        (2) When a beneficiary, insured, or enrollee utilizes
13    a participating health care facility and receives
14    non-emergency covered health care services other than
15    those described in paragraph (1) of this subsection from a
16    nonparticipating provider during or resulting from the
17    visit, the health insurance issuer shall ensure that the
18    beneficiary, insured, or enrollee incurs no greater
19    out-of-pocket costs than the beneficiary, insured, or
20    enrollee would have incurred with a participating provider
21    unless the nonparticipating provider, or the participating
22    health care facility on behalf of the nonparticipating
23    provider, satisfies the notice and consent criteria
24    provided in 42 U.S.C. 300gg-132 and regulations
25    promulgated thereunder. If the notice and consent criteria
26    are not satisfied, then:

 

 

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1            (A) any cost-sharing requirements shall be applied
2        as though the health care services had been received
3        from a participating provider;
4            (B) cost sharing shall be calculated based on the
5        recognized amount for the health care services; and
6            (C) in no event shall the beneficiary, insured,
7        enrollee, or any group policyholder or plan sponsor be
8        liable to or billed by the health insurance issuer,
9        the nonparticipating provider, or the participating
10        health care facility for any amount beyond the cost
11        sharing calculated in accordance with this subsection
12        with respect to the health care services delivered.
13    (c) Notwithstanding any other provision of this Code,
14except when the notice and consent criteria are satisfied for
15the situation in paragraph (2) of subsection (b-5), any
16benefits a beneficiary, insured, or enrollee receives for
17services under the situations in subsection subsections (b) or
18(b-5) are assigned to the nonparticipating providers or the
19facility acting on their behalf. Upon receipt of the
20provider's bill or facility's bill, the health insurance
21issuer shall provide the nonparticipating provider or the
22facility with a written explanation of benefits that specifies
23the proposed reimbursement and the applicable deductible,
24copayment, or coinsurance amounts owed by the insured,
25beneficiary, or enrollee. The health insurance issuer shall
26pay any reimbursement subject to this Section directly to the

 

 

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1nonparticipating provider or the facility.
2    (d) For bills assigned under subsection (c), the
3nonparticipating provider or the facility may bill the health
4insurance issuer for the services rendered, and the health
5insurance issuer may pay the billed amount or attempt to
6negotiate reimbursement with the nonparticipating provider or
7the facility. Within 30 calendar days after the provider or
8facility transmits the bill to the health insurance issuer,
9the issuer shall send an initial payment or notice of denial of
10payment with the written explanation of benefits to the
11provider or facility. If attempts to negotiate reimbursement
12for services provided by a nonparticipating provider do not
13result in a resolution of the payment dispute within 30 days
14after receipt of written explanation of benefits by the health
15insurance issuer, then the health insurance issuer or
16nonparticipating provider or the facility may initiate binding
17arbitration to determine payment for services provided on a
18per-bill per bill basis. The party requesting arbitration
19shall notify the other party arbitration has been initiated
20and state its final offer before arbitration. In response to
21this notice, the nonrequesting party shall inform the
22requesting party of its final offer before the arbitration
23occurs. Arbitration shall be initiated by filing a request
24with the Department of Insurance.
25    (e) The Department of Insurance shall publish a list of
26approved arbitrators or entities that shall provide binding

 

 

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1arbitration. These arbitrators shall be American Arbitration
2Association or American Health Lawyers Association trained
3arbitrators. Both parties must agree on an arbitrator from the
4Department of Insurance's or its approved entity's list of
5arbitrators. If no agreement can be reached, then a list of 5
6arbitrators shall be provided by the Department of Insurance
7or the approved entity. From the list of 5 arbitrators, the
8health insurance issuer can veto 2 arbitrators and the
9provider or facility can veto 2 arbitrators. The remaining
10arbitrator shall be the chosen arbitrator. This arbitration
11shall consist of a review of the written submissions by both
12parties. The arbitrator shall not establish a rebuttable
13presumption that the qualifying payment amount should be the
14total amount owed to the provider or facility by the
15combination of the issuer and the insured, beneficiary, or
16enrollee. Binding arbitration shall provide for a written
17decision within 45 days after the request is filed with the
18Department of Insurance. Both parties shall be bound by the
19arbitrator's decision. The arbitrator's expenses and fees,
20together with other expenses, not including attorney's fees,
21incurred in the conduct of the arbitration, shall be paid as
22provided in the decision.
23    (f) (Blank).
24    (f-1) A health care provider shall not charge or collect
25from a Medicare beneficiary, insured, or enrollee any amount
26in excess of the Medicare-approved amount for any

 

 

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1Medicare-covered item or service provided.
2    (g) Section 368a of this Act shall not apply during the
3pendency of a decision under subsection (d). Upon the issuance
4of the arbitrator's decision, Section 368a applies with
5respect to the amount, if any, by which the arbitrator's
6determination exceeds the issuer's initial payment under
7subsection (c), or the entire amount of the arbitrator's
8determination if initial payment was denied. Any interest
9required to be paid to a provider under Section 368a shall not
10accrue until after 30 days of an arbitrator's decision as
11provided in subsection (d), but in no circumstances longer
12than 150 days from the date the nonparticipating
13facility-based provider billed for services rendered.
14    (h) Nothing in this Section shall be interpreted to change
15the prudent layperson provisions with respect to emergency
16services under the Managed Care Reform and Patient Rights Act.
17    (i) Nothing in this Section shall preclude a health care
18provider from billing a beneficiary, insured, or enrollee for
19reasonable administrative fees, such as service fees for
20checks returned for nonsufficient funds and missed
21appointments.
22    (j) Nothing in this Section shall preclude a beneficiary,
23insured, or enrollee from assigning benefits to a
24nonparticipating provider when the notice and consent criteria
25are satisfied under paragraph (2) of subsection (b-5) or in
26any other situation not described in subsection subsections

 

 

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1(b) or (b-5).
2    (k) Except when the notice and consent criteria are
3satisfied under paragraph (2) of subsection (b-5), if an
4individual receives health care services under the situations
5described in subsections (b) or (b-5), no referral requirement
6or any other provision contained in the policy or certificate
7of coverage shall deny coverage, reduce benefits, or otherwise
8defeat the requirements of this Section for services that
9would have been covered with a participating provider.
10However, this subsection shall not be construed to preclude a
11provider contract with a health insurance issuer, or with an
12administrator or similar entity acting on the issuer's behalf,
13from imposing requirements on the participating provider,
14participating emergency facility, or participating health care
15facility relating to the referral of covered individuals to
16nonparticipating providers.
17    (l) Except if the notice and consent criteria are
18satisfied under paragraph (2) of subsection (b-5),
19cost-sharing amounts calculated in conformity with this
20Section shall count toward any deductible or out-of-pocket
21maximum applicable to in-network coverage.
22    (m) The Department has the authority to enforce the
23requirements of this Section in the situations described in
24subsections (b), and (b-5), and (f-1), and in any other
25situation for which 42 U.S.C. Chapter 6A, Subchapter XXV,
26Parts D or E and regulations promulgated thereunder would

 

 

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1prohibit an individual from being billed or liable for
2emergency services furnished by a nonparticipating provider or
3nonparticipating emergency facility or for non-emergency
4health care services furnished by a nonparticipating provider
5at a participating health care facility.
6    (n) This Section does not apply with respect to air
7ambulance or ground ambulance services. This Section does not
8apply to any policy of excepted benefits or to short-term,
9limited-duration health insurance coverage.
10(Source: P.A. 102-901, eff. 7-1-22; revised 8-19-22.)
 
11    Section 10. The Health Maintenance Organization Act is
12amended by changing Section 4.5-1 as follows:
 
13    (215 ILCS 125/4.5-1)
14    Sec. 4.5-1. Point-of-service health service contracts.
15    (a) A health maintenance organization that offers a
16point-of-service contract:
17        (1) must include as in-plan covered services all
18    services required by law to be provided by a health
19    maintenance organization;
20        (2) must provide incentives, which shall include
21    financial incentives, for enrollees to use in-plan covered
22    services;
23        (3) may not offer services out-of-plan without
24    providing those services on an in-plan basis;

 

 

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1        (4) may include annual out-of-pocket limits and
2    lifetime maximum benefits allowances for out-of-plan
3    services that are separate from any limits or allowances
4    applied to in-plan services;
5        (5) may not consider emergency services, authorized
6    referral services, or non-routine services obtained out of
7    the service area to be point-of-service services;
8        (6) may treat as out-of-plan services those services
9    that an enrollee obtains from a participating provider,
10    but for which the proper authorization was not given by
11    the health maintenance organization; and
12        (7) after January 1, 2003 (the effective date of
13    Public Act 92-579) this amendatory Act of the 92nd General
14    Assembly, must include the following disclosure on its
15    point-of-service contracts and evidences of coverage:
16    "WARNING, LIMITED BENEFITS WILL BE PAID WHEN
17    NON-PARTICIPATING PROVIDERS ARE USED. You should be aware
18    that when you elect to utilize the services of a
19    non-participating provider for a covered service in
20    non-emergency situations, benefit payments to such
21    non-participating provider are not based upon the amount
22    billed. The basis of your benefit payment will be
23    determined according to your policy's fee schedule, usual
24    and customary charge (which is determined by comparing
25    charges for similar services adjusted to the geographical
26    area where the services are performed), or other method as

 

 

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1    defined by the policy. YOU CAN EXPECT TO PAY MORE THAN THE
2    COINSURANCE AMOUNT DEFINED IN THE POLICY AFTER THE PLAN
3    HAS PAID ITS REQUIRED PORTION. Non-participating providers
4    may bill members for any amount up to the billed charge
5    after the plan has paid its portion of the bill, except as
6    provided in Section 356z.3a of the Illinois Insurance Code
7    for covered services received at a participating health
8    care facility from a non-participating provider that are:
9    (a) ancillary services, (b) items or services furnished as
10    a result of unforeseen, urgent medical needs that arise at
11    the time the item or service is furnished, or (c) items or
12    services received when the facility or the
13    non-participating provider fails to satisfy the notice and
14    consent criteria specified under Section 356z.3a, or (d)
15    items or services provided to a Medicare beneficiary,
16    insured, or enrollee. Participating providers have agreed
17    to accept discounted payments for services with no
18    additional billing to the member other than co-insurance
19    and deductible amounts. You may obtain further information
20    about the participating status of professional providers
21    and information on out-of-pocket expenses by calling the
22    toll free telephone number on your identification card.".
23    (b) A health maintenance organization offering a
24point-of-service contract is subject to all of the following
25limitations:
26        (1) The health maintenance organization may not expend

 

 

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1    in any calendar quarter more than 20% of its total
2    expenditures for all its members for out-of-plan covered
3    services.
4        (2) If the amount specified in item (1) of this
5    subsection is exceeded by 2% in a quarter, the health
6    maintenance organization must effect compliance with item
7    (1) of this subsection by the end of the following
8    quarter.
9        (3) If compliance with the amount specified in item
10    (1) of this subsection is not demonstrated in the health
11    maintenance organization's next quarterly report, the
12    health maintenance organization may not offer the
13    point-of-service contract to new groups or include the
14    point-of-service option in the renewal of an existing
15    group until compliance with the amount specified in item
16    (1) of this subsection is demonstrated or until otherwise
17    allowed by the Director.
18        (4) A health maintenance organization failing, without
19    just cause, to comply with the provisions of this
20    subsection shall be required, after notice and hearing, to
21    pay a penalty of $250 for each day out of compliance, to be
22    recovered by the Director. Any penalty recovered shall be
23    paid into the General Revenue Fund. The Director may
24    reduce the penalty if the health maintenance organization
25    demonstrates to the Director that the imposition of the
26    penalty would constitute a financial hardship to the

 

 

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1    health maintenance organization.
2    (c) A health maintenance organization that offers a
3point-of-service product must do all of the following:
4        (1) File a quarterly financial statement detailing
5    compliance with the requirements of subsection (b).
6        (2) Track out-of-plan, point-of-service utilization
7    separately from in-plan or non-point-of-service,
8    out-of-plan emergency care, referral care, and urgent care
9    out of the service area utilization.
10        (3) Record out-of-plan utilization in a manner that
11    will permit such utilization and cost reporting as the
12    Director may, by rule, require.
13        (4) Demonstrate to the Director's satisfaction that
14    the health maintenance organization has the fiscal,
15    administrative, and marketing capacity to control its
16    point-of-service enrollment, utilization, and costs so as
17    not to jeopardize the financial security of the health
18    maintenance organization.
19        (5) Maintain, in addition to any other deposit
20    required under this Act, the deposit required by Section
21    2-6.
22        (6) Maintain cash and cash equivalents of sufficient
23    amount to fully liquidate 10 days' average claim payments,
24    subject to review by the Director.
25        (7) Maintain and file with the Director, reinsurance
26    coverage protecting against catastrophic losses on

 

 

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1    out-of-network out of network point-of-service services.
2    Deductibles may not exceed $100,000 per covered life per
3    year, and the portion of risk retained by the health
4    maintenance organization once deductibles have been
5    satisfied may not exceed 20%. Reinsurance must be placed
6    with licensed authorized reinsurers qualified to do
7    business in this State.
8    (d) A health maintenance organization may not issue a
9point-of-service contract until it has filed and had approved
10by the Director a plan to comply with the provisions of this
11Section. The compliance plan must, at a minimum, include
12provisions demonstrating that the health maintenance
13organization will do all of the following:
14        (1) Design the benefit levels and conditions of
15    coverage for in-plan covered services and out-of-plan
16    covered services as required by this Article.
17        (2) Provide or arrange for the provision of adequate
18    systems to:
19            (A) process and pay claims for all out-of-plan
20        covered services;
21            (B) meet the requirements for point-of-service
22        contracts set forth in this Section and any additional
23        requirements that may be set forth by the Director;
24        and
25            (C) generate accurate data and financial and
26        regulatory reports on a timely basis so that the

 

 

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1        Department of Insurance can evaluate the health
2        maintenance organization's experience with the
3        point-of-service contract and monitor compliance with
4        point-of-service contract provisions.
5        (3) Comply with the requirements of subsections (b)
6    and (c).
7(Source: P.A. 102-901, eff. 1-1-23; revised 12-9-22.)
 
8    Section 99. Effective date. This Act takes effect upon
9becoming law.