093_SB1080

 
                                     LRB093 10829 JLS 11285 b

 1        AN ACT concerning insurance coverage.

 2        Be  it  enacted  by  the People of the State of Illinois,
 3    represented in the General Assembly:

 4        Section 5.  The Illinois Insurance  Code  is  amended  by
 5    adding Section 356z.4 as follows:

 6        (215 ILCS 5/356z.4 new)
 7        Sec. 356z.4.  Morbid obesity.
 8        (a)  A  group or individual policy of accident and health
 9    insurance amended, delivered, issued, or  renewed  after  the
10    effective  date  of  this  amendatory Act of the 93rd General
11    Assembly must  provide  benefits  for  the  expenses  of  the
12    surgical  treatment  of  morbid  obesity  for  the  following
13    individuals:
14             (1)  individuals  with a body-mass index equal to or
15        greater than 40 kilograms per meter squared;
16             (2)  individuals with a body-mass index equal to  or
17        greater   than  35  kilograms  per  meter  squared,  with
18        comorbidities or coexisting medical conditions,  such  as
19        hypertension, cardiopulmonary conditions, sleep apnea, or
20        diabetes; and
21             (3)  individuals  who  meet  the  guidelines for the
22        surgical treatment of morbid obesity as set forth by  the
23        national institutes of health.
24        (b)  The  benefits  provided  under  subsection (a) shall
25    include  benefits  for  examinations  and  laboratory   tests
26    performed  in  accordance with the guidelines of the national
27    institutes of health for the  surgical  treatment  of  morbid
28    obesity.
29        (c)  The  benefits provided under subsection (a) shall be
30    no less extensive than those provided for any other medically
31    necessary surgical procedure under the policy  and  shall  be
 
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 1    subject to the same terms and conditions, including copayment
 2    charges.

 3        Section  10.  The  Health Maintenance Organization Act is
 4    amended by changing Section 5-3 as follows:

 5        (215 ILCS 125/5-3) (from Ch. 111 1/2, par. 1411.2)
 6        Sec. 5-3.  Insurance Code provisions.
 7        (a)  Health Maintenance Organizations shall be subject to
 8    the provisions of Sections 133, 134, 137, 140, 141.1,  141.2,
 9    141.3,  143,  143c, 147, 148, 149, 151, 152, 153, 154, 154.5,
10    154.6, 154.7, 154.8, 155.04, 355.2, 356m, 356v,  356w,  356x,
11    356y, 356z.2, 356z.4, 367i, 368a, 401, 401.1, 402, 403, 403A,
12    408,  408.2,  409,  412,  444,  and  444.1,  paragraph (c) of
13    subsection (2) of Section 367, and Articles  IIA,  VIII  1/2,
14    XII,  XII  1/2, XIII, XIII 1/2, XXV, and XXVI of the Illinois
15    Insurance Code.
16        (b)  For purposes of the Illinois Insurance Code,  except
17    for  Sections  444  and 444.1 and Articles XIII and XIII 1/2,
18    Health Maintenance Organizations in the following  categories
19    are deemed to be "domestic companies":
20             (1)  a   corporation  authorized  under  the  Dental
21        Service Plan Act or the Voluntary Health  Services  Plans
22        Act;
23             (2)  a  corporation organized under the laws of this
24        State; or
25             (3)  a  corporation  organized  under  the  laws  of
26        another state, 30% or more of the enrollees of which  are
27        residents  of this State, except a corporation subject to
28        substantially the  same  requirements  in  its  state  of
29        organization  as  is  a  "domestic company" under Article
30        VIII 1/2 of the Illinois Insurance Code.
31        (c)  In considering the merger, consolidation,  or  other
32    acquisition  of  control of a Health Maintenance Organization
 
                            -3-      LRB093 10829 JLS 11285 b
 1    pursuant to Article VIII 1/2 of the Illinois Insurance Code,
 2             (1)  the Director shall give  primary  consideration
 3        to  the  continuation  of  benefits  to enrollees and the
 4        financial conditions of the acquired  Health  Maintenance
 5        Organization  after  the  merger, consolidation, or other
 6        acquisition of control takes effect;
 7             (2)(i)  the criteria specified in subsection  (1)(b)
 8        of Section 131.8 of the Illinois Insurance Code shall not
 9        apply  and (ii) the Director, in making his determination
10        with respect  to  the  merger,  consolidation,  or  other
11        acquisition  of  control,  need not take into account the
12        effect on competition of the  merger,  consolidation,  or
13        other acquisition of control;
14             (3)  the  Director  shall  have the power to require
15        the following information:
16                  (A)  certification by an independent actuary of
17             the  adequacy  of  the  reserves   of   the   Health
18             Maintenance Organization sought to be acquired;
19                  (B)  pro  forma financial statements reflecting
20             the combined balance sheets of the acquiring company
21             and the Health Maintenance Organization sought to be
22             acquired as of the end of the preceding year and  as
23             of  a date 90 days prior to the acquisition, as well
24             as  pro  forma   financial   statements   reflecting
25             projected  combined  operation  for  a  period  of 2
26             years;
27                  (C)  a pro forma  business  plan  detailing  an
28             acquiring   party's   plans   with  respect  to  the
29             operation of  the  Health  Maintenance  Organization
30             sought  to be acquired for a period of not less than
31             3 years; and
32                  (D)  such other  information  as  the  Director
33             shall require.
34        (d)  The  provisions  of Article VIII 1/2 of the Illinois
 
                            -4-      LRB093 10829 JLS 11285 b
 1    Insurance Code and this Section 5-3 shall apply to  the  sale
 2    by any health maintenance organization of greater than 10% of
 3    its  enrollee  population  (including  without limitation the
 4    health maintenance organization's right, title, and  interest
 5    in and to its health care certificates).
 6        (e)  In  considering  any  management contract or service
 7    agreement subject to Section 141.1 of the Illinois  Insurance
 8    Code,  the  Director  (i)  shall, in addition to the criteria
 9    specified in Section 141.2 of the  Illinois  Insurance  Code,
10    take  into  account  the effect of the management contract or
11    service  agreement  on  the  continuation  of   benefits   to
12    enrollees   and   the   financial  condition  of  the  health
13    maintenance organization to be managed or serviced, and  (ii)
14    need  not  take  into  account  the  effect of the management
15    contract or service agreement on competition.
16        (f)  Except for small employer groups as defined  in  the
17    Small  Employer  Rating,  Renewability and Portability Health
18    Insurance Act and except for medicare supplement policies  as
19    defined  in  Section  363  of  the Illinois Insurance Code, a
20    Health Maintenance Organization may by contract agree with  a
21    group  or  other  enrollment unit to effect refunds or charge
22    additional premiums under the following terms and conditions:
23             (i)  the amount of, and other terms  and  conditions
24        with respect to, the refund or additional premium are set
25        forth  in the group or enrollment unit contract agreed in
26        advance of the period for which a refund is to be paid or
27        additional premium is to be charged (which  period  shall
28        not be less than one year); and
29             (ii)  the amount of the refund or additional premium
30        shall   not   exceed   20%   of  the  Health  Maintenance
31        Organization's profitable or unprofitable experience with
32        respect to the group or other  enrollment  unit  for  the
33        period  (and,  for  purposes  of  a  refund or additional
34        premium, the profitable or unprofitable experience  shall
 
                            -5-      LRB093 10829 JLS 11285 b
 1        be calculated taking into account a pro rata share of the
 2        Health   Maintenance  Organization's  administrative  and
 3        marketing expenses, but shall not include any  refund  to
 4        be made or additional premium to be paid pursuant to this
 5        subsection (f)).  The Health Maintenance Organization and
 6        the   group   or  enrollment  unit  may  agree  that  the
 7        profitable or unprofitable experience may  be  calculated
 8        taking into account the refund period and the immediately
 9        preceding 2 plan years.
10        The  Health  Maintenance  Organization  shall  include  a
11    statement in the evidence of coverage issued to each enrollee
12    describing the possibility of a refund or additional premium,
13    and  upon request of any group or enrollment unit, provide to
14    the group or enrollment unit a description of the method used
15    to  calculate  (1)  the  Health  Maintenance   Organization's
16    profitable experience with respect to the group or enrollment
17    unit and the resulting refund to the group or enrollment unit
18    or  (2)  the  Health  Maintenance Organization's unprofitable
19    experience with respect to the group or enrollment  unit  and
20    the  resulting  additional premium to be paid by the group or
21    enrollment unit.
22        In  no  event  shall  the  Illinois  Health   Maintenance
23    Organization  Guaranty  Association  be  liable  to  pay  any
24    contractual  obligation  of  an insolvent organization to pay
25    any refund authorized under this Section.
26    (Source: P.A. 91-357,  eff.  7-29-99;  91-406,  eff.  1-1-00;
27    91-549,  eff.  8-14-99;  91-605,  eff. 12-14-99; 91-788, eff.
28    6-9-00; 92-764, eff. 1-1-03.)

29        Section 15.  The Voluntary Health Services Plans  Act  is
30    amended by changing Section 10 as follows:

31        (215 ILCS 165/10) (from Ch. 32, par. 604)
32        Sec.   10.  Application  of  Insurance  Code  provisions.
 
                            -6-      LRB093 10829 JLS 11285 b
 1    Health services plan corporations and all persons  interested
 2    therein   or  dealing  therewith  shall  be  subject  to  the
 3    provisions of Articles IIA and XII 1/2 and Sections 3.1, 133,
 4    140, 143, 143c, 149, 155.37, 354, 355.2,  356r,  356t,  356u,
 5    356v,  356w, 356x, 356y, 356z.1, 356z.2, 356z.4, 367.2, 368a,
 6    401,  401.1,  402,  403,  403A,  408,  408.2,  and  412,  and
 7    paragraphs (7) and  (15)  of  Section  367  of  the  Illinois
 8    Insurance Code.
 9    (Source: P.A.  91-406,  eff.  1-1-00;  91-549,  eff. 8-14-99;
10    91-605, eff. 12-14-99;  91-788,  eff.  6-9-00;  92-130,  eff.
11    7-20-01;  92-440, eff. 8-17-01; 92-651, eff. 7-11-02; 92-764,
12    eff. 1-1-03.)