Rep. Karen May

Filed: 3/30/2012

 

 


 

 


 
09700HB3976ham003LRB097 16441 RPM 68296 a

1
AMENDMENT TO HOUSE BILL 3976

2    AMENDMENT NO. ______. Amend House Bill 3976, AS AMENDED, by
3replacing everything after the enacting clause with the
4following:
 
5    "Section 5. The Health Care Purchasing Group Act is amended
6by changing Sections 10 and 15 as follows:
 
7    (215 ILCS 123/10)
8    Sec. 10. Definitions. Words and phrases used in this Act,
9unless defined in this Section, have the meanings attributed to
10them in Section 5 of the Illinois Health Insurance Portability
11and Accountability Act.
12    "Director" means the Director of Insurance.
13    "Employer" means an individual, sole proprietorship,
14partnership, firm, corporation, association, or any other
15legal entity that has one or more employees and is legally
16doing business in this State.

 

 

09700HB3976ham003- 2 -LRB097 16441 RPM 68296 a

1    "Health insurance contract", "group or master health
2insurance contract" and "insurance" refer to the forms of
3insurance obligations which a "risk-bearer" as defined in this
4Section has been authorized to issue.
5    "Risk-bearer" means an insurance company licensed in this
6State and authorized to transact the kinds of business
7described in clause (b) of Class 1 and clause (a) of Class 2 of
8Section 4 of the Illinois Insurance Code and entities
9authorized under the Health Maintenance Organization Act.
10(Source: P.A. 90-337, eff. 1-1-98; 90-567, eff. 1-23-98.)
 
11    (215 ILCS 123/15)
12    Sec. 15. Health care purchasing groups; membership;
13formation.
14    (a) An HPG may be an organization formed by 2 or more
15employers with no more than 2,500 500 covered employees each,
16an HPG sponsor or a risk-bearer for purposes of contracting for
17health insurance under this Act to cover employees and
18dependents of HPG members. An HPG shall not be prevented from
19supplementing health insurance coverage purchased under this
20Act by contracting for services from entities licensed and
21authorized in Illinois to provide those services under the
22Dental Service Plan Act, the Limited Health Service
23Organization Act, or Voluntary Health Services Plans Act. An
24HPG may be a separate legal entity or simply a group of 2 or
25more employers with no more than 2,500 500 covered employees

 

 

09700HB3976ham003- 3 -LRB097 16441 RPM 68296 a

1each aggregated under this Act by an HPG sponsor or risk-bearer
2for insurance purposes. There shall be no limit as to the
3number of HPGs that may operate in any geographic area of the
4State. No insurance risk may be borne or retained by the HPG.
5All health insurance contracts issued to the HPG must be
6delivered or issued for delivery in Illinois.
7    (b) Members of an HPG must be Illinois domiciled employers,
8except that an employer domiciled elsewhere may become a member
9of an Illinois HPG for the sole purpose of insuring its
10employees whose place of employment is located within this
11State. HPG membership may include employers having no more than
122,500 500 covered employees each.
13    (c) If an HPG is formed by any 2 or more employers with no
14more than 2,500 500 covered employees each, it is authorized to
15negotiate, solicit, market, obtain proposals for, and enter
16into group or master health insurance contracts on behalf of
17its members and their employees and employee dependents so long
18as it meets all of the following requirements:
19        (1) The HPG must be an organization having the legal
20    capacity to contract and having its legal situs in
21    Illinois.
22        (2) The principal persons responsible for the conduct
23    of the HPG must perform their HPG related functions in
24    Illinois.
25        (3) No HPG may collect premium in its name or hold or
26    manage premium or claim fund accounts unless duly licensed

 

 

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1    and qualified as a managing general agent pursuant to
2    Section 141a of the Illinois Insurance Code or a third
3    party administrator pursuant to Section 511.105 of the
4    Illinois Insurance Code.
5        (4) If the HPG gives an offer, application, notice, or
6    proposal of insurance to an employer, it must disclose to
7    that employer the total cost of the insurance. Dues, fees,
8    or charges to be paid to the HPG, HPG sponsor, or any other
9    entity as a condition to purchasing the insurance must be
10    itemized. The HPG shall also disclose to its members the
11    amount of any dividends, experience refunds, or other such
12    payments it receives from the risk-bearer.
13        (5) An HPG must register with the Director before
14    entering into a group or master health insurance contract
15    on behalf of its members and must renew the registration
16    annually on forms and at times prescribed by the Director
17    in rules specifying, at minimum, (i) the identity of the
18    officers and directors, trustees, or attorney-in-fact of
19    the HPG; (ii) a certification that those persons have not
20    been convicted of any felony offense involving a breach of
21    fiduciary duty or improper manipulation of accounts; and
22    (iii) the number of employer members then enrolled in the
23    HPG, together with any other information that may be needed
24    to carry out the purposes of this Act.
25        (6) At the time of initial registration and each
26    renewal thereof an HPG shall pay a fee of $100 to the

 

 

09700HB3976ham003- 5 -LRB097 16441 RPM 68296 a

1    Director.
2    (d) If an HPG is formed by an HPG sponsor or risk-bearer
3and the HPG performs no marketing, negotiation, solicitation,
4or proposing of insurance to HPG members, exclusive of
5ministerial acts performed by individual employers to service
6their own employees, then a group or master health insurance
7contract may be issued in the name of the HPG and held by an HPG
8sponsor, risk-bearer, or designated employer member within the
9State. In these cases the HPG requirements specified in
10subsection (c) shall not be applicable, however:
11        (1) the group or master health insurance contract must
12    contain a provision permitting the contract to be enforced
13    through legal action initiated by any employer member or by
14    an employee of an HPG member who has paid premium for the
15    coverage provided;
16        (2) the group or master health insurance contract must
17    be available for inspection and copying by any HPG member,
18    employee, or insured dependent at a designated location
19    within the State at all normal business hours; and
20        (3) any information concerning HPG membership required
21    by rule under item (5) of subsection (c) must be provided
22    by the HPG sponsor in its registration and renewal forms or
23    by the risk-bearer in its annual reports.
24(Source: P.A. 90-337, eff. 1-1-98; 90-655, eff. 7-30-98;
2591-617, eff. 1-1-00.)".