Rep. Greg Harris

Filed: 3/31/2009





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2     AMENDMENT NO. ______. Amend House Bill 3923, AS AMENDED, by
3 replacing everything after the enacting clause with the
4 following:
5     "Section 5. The Illinois Insurance Code is amended by
6 adding Sections 359a.1 and 359a.2 and Article XLV and by
7 changing Section 370c as follows:
8     (215 ILCS 5/359a.1 new)
9     Sec. 359a.1. Standard small group applications. The
10 Director shall develop, by rule, a standard application form
11 for use by small employers applying for coverage under a health
12 benefit plan offered by small employer carriers. Small employer
13 carriers shall be required to use the standard application form
14 not less than 6 months after the rules developing the form
15 become effective. The Director shall revise the standard
16 application form at least every 3 years. For purposes of this



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1 Section, "health benefit plan", "small employer", and "small
2 employer carrier" shall have the meaning given those terms in
3 the Small Employer Health Insurance Rating Act.
4     (215 ILCS 5/359a.2 new)
5     Sec. 359a.2. Standard individual market health statements.
6 The Director shall develop, by rule, a standard health
7 statement for use by individuals applying for a health benefit
8 plan in the individual market. All carriers who offer health
9 benefit plans in the individual market and evaluate the health
10 status of individuals shall be required to use the standard
11 health statement not less than 6 months after the statement
12 becomes effective and thereafter may not use any other method
13 to determine the health status of an individual. Nothing in
14 this Section shall prevent a carrier from using health
15 information after enrollment for the purpose of providing
16 services or arranging for the provision of services under a
17 health benefit plan. For purposes of this Section, "health
18 benefit plan" shall have the meaning given the term in the
19 Small Employer Health Insurance Rating Act and "individual
20 market" shall have meaning given the term in the Illinois
21 Health Insurance Portability and Accountability Act.
22     (215 ILCS 5/370c)  (from Ch. 73, par. 982c)
23     Sec. 370c. Mental and emotional disorders.
24     (a) (1) On and after the effective date of this Section,



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1 every insurer which delivers, issues for delivery or renews or
2 modifies group A&H policies providing coverage for hospital or
3 medical treatment or services for illness on an
4 expense-incurred basis shall offer to the applicant or group
5 policyholder subject to the insurers standards of
6 insurability, coverage for reasonable and necessary treatment
7 and services for mental, emotional or nervous disorders or
8 conditions, other than serious mental illnesses as defined in
9 item (2) of subsection (b), up to the limits provided in the
10 policy for other disorders or conditions, except (i) the
11 insured may be required to pay up to 50% of expenses incurred
12 as a result of the treatment or services, and (ii) the annual
13 benefit limit may be limited to the lesser of $10,000 or 25% of
14 the lifetime policy limit.
15     (2) Each insured that is covered for mental, emotional or
16 nervous disorders or conditions shall be free to select the
17 physician licensed to practice medicine in all its branches,
18 licensed clinical psychologist, licensed clinical social
19 worker, licensed clinical professional counselor, or licensed
20 marriage and family therapist of his choice to treat such
21 disorders, and the insurer shall pay the covered charges of
22 such physician licensed to practice medicine in all its
23 branches, licensed clinical psychologist, licensed clinical
24 social worker, licensed clinical professional counselor, or
25 licensed marriage and family therapist up to the limits of
26 coverage, provided (i) the disorder or condition treated is



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1 covered by the policy, and (ii) the physician, licensed
2 psychologist, licensed clinical social worker, licensed
3 clinical professional counselor, or licensed marriage and
4 family therapist is authorized to provide said services under
5 the statutes of this State and in accordance with accepted
6 principles of his profession.
7     (3) Insofar as this Section applies solely to licensed
8 clinical social workers, licensed clinical professional
9 counselors, and licensed marriage and family therapists, those
10 persons who may provide services to individuals shall do so
11 after the licensed clinical social worker, licensed clinical
12 professional counselor, or licensed marriage and family
13 therapist has informed the patient of the desirability of the
14 patient conferring with the patient's primary care physician
15 and the licensed clinical social worker, licensed clinical
16 professional counselor, or licensed marriage and family
17 therapist has provided written notification to the patient's
18 primary care physician, if any, that services are being
19 provided to the patient. That notification may, however, be
20 waived by the patient on a written form. Those forms shall be
21 retained by the licensed clinical social worker, licensed
22 clinical professional counselor, or licensed marriage and
23 family therapist for a period of not less than 5 years.
24     (b) (1) An insurer that provides coverage for hospital or
25 medical expenses under a group policy of accident and health
26 insurance or health care plan amended, delivered, issued, or



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1 renewed after the effective date of this amendatory Act of the
2 92nd General Assembly shall provide coverage under the policy
3 for treatment of serious mental illness under the same terms
4 and conditions as coverage for hospital or medical expenses
5 related to other illnesses and diseases. The coverage required
6 under this Section must provide for same durational limits,
7 amount limits, deductibles, and co-insurance requirements for
8 serious mental illness as are provided for other illnesses and
9 diseases. This subsection does not apply to coverage provided
10 to employees by employers who have 50 or fewer employees.
11     (2) "Serious mental illness" means the following
12 psychiatric illnesses as defined in the most current edition of
13 the Diagnostic and Statistical Manual (DSM) published by the
14 American Psychiatric Association:
15         (A) schizophrenia;
16         (B) paranoid and other psychotic disorders;
17         (C) bipolar disorders (hypomanic, manic, depressive,
18     and mixed);
19         (D) major depressive disorders (single episode or
20     recurrent);
21         (E) schizoaffective disorders (bipolar or depressive);
22         (F) pervasive developmental disorders;
23         (G) obsessive-compulsive disorders;
24         (H) depression in childhood and adolescence;
25         (I) panic disorder;
26         (J) post-traumatic stress disorders (acute, chronic,



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1     or with delayed onset); and
2         (K) anorexia nervosa and bulimia nervosa.
3     (3) (Blank). Upon request of the reimbursing insurer, a
4 provider of treatment of serious mental illness shall furnish
5 medical records or other necessary data that substantiate that
6 initial or continued treatment is at all times medically
7 necessary. An insurer shall provide a mechanism for the timely
8 review by a provider holding the same license and practicing in
9 the same specialty as the patient's provider, who is
10 unaffiliated with the insurer, jointly selected by the patient
11 (or the patient's next of kin or legal representative if the
12 patient is unable to act for himself or herself), the patient's
13 provider, and the insurer in the event of a dispute between the
14 insurer and patient's provider regarding the medical necessity
15 of a treatment proposed by a patient's provider. If the
16 reviewing provider determines the treatment to be medically
17 necessary, the insurer shall provide reimbursement for the
18 treatment. Future contractual or employment actions by the
19 insurer regarding the patient's provider may not be based on
20 the provider's participation in this procedure. Nothing
21 prevents the insured from agreeing in writing to continue
22 treatment at his or her expense. When making a determination of
23 the medical necessity for a treatment modality for serous
24 mental illness, an insurer must make the determination in a
25 manner that is consistent with the manner used to make that
26 determination with respect to other diseases or illnesses



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1 covered under the policy, including an appeals process.
2     (4) A group health benefit plan:
3         (A) shall provide coverage based upon medical
4     necessity for the following treatment of mental illness in
5     each calendar year:
6             (i) 45 days of inpatient treatment; and
7             (ii) beginning on June 26, 2006 (the effective date
8         of Public Act 94-921), 60 visits for outpatient
9         treatment including group and individual outpatient
10         treatment; and
11             (iii) for plans or policies delivered, issued for
12         delivery, renewed, or modified after January 1, 2007
13         (the effective date of Public Act 94-906), 20
14         additional outpatient visits for speech therapy for
15         treatment of pervasive developmental disorders that
16         will be in addition to speech therapy provided pursuant
17         to item (ii) of this subparagraph (A);
18         (B) may not include a lifetime limit on the number of
19     days of inpatient treatment or the number of outpatient
20     visits covered under the plan; and
21         (C) shall include the same amount limits, deductibles,
22     copayments, and coinsurance factors for serious mental
23     illness as for physical illness.
24     (5) An issuer of a group health benefit plan may not count
25 toward the number of outpatient visits required to be covered
26 under this Section an outpatient visit for the purpose of



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1 medication management and shall cover the outpatient visits
2 under the same terms and conditions as it covers outpatient
3 visits for the treatment of physical illness.
4     (6) An issuer of a group health benefit plan may provide or
5 offer coverage required under this Section through a managed
6 care plan.
7     (7) This Section shall not be interpreted to require a
8 group health benefit plan to provide coverage for treatment of:
9         (A) an addiction to a controlled substance or cannabis
10     that is used in violation of law; or
11         (B) mental illness resulting from the use of a
12     controlled substance or cannabis in violation of law.
13     (8) (Blank).
14     (9) On and after June 1, 2010, coverage for the treatment
15 of mental and emotional disorders as provided by subsections
16 (a) and (b) of this Section shall not be denied under the
17 policy, provided that services are medically necessary as
18 determined by the insured's treating physician. For purposes of
19 this Section, "medically necessary" means health care services
20 appropriate, in terms of type, frequency, level, setting, and
21 duration, to the enrollee's diagnosis or condition, and
22 diagnostic testing and preventive services. Medically
23 necessary care must be consistent with generally accepted
24 practice parameters as determined by health care providers in
25 the same or similar general specialty as typically manages the
26 condition, procedure, or treatment at issue and must be



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1 intended to either help restore or maintain the enrollee's
2 health or prevent deterioration of the enrollee's condition.
3 Upon request of the reimbursing insurer, a provider of
4 treatment of serious mental illness shall furnish medical
5 records or other necessary data that substantiate that initial
6 or continued treatment is at all times medically necessary.
7 (Source: P.A. 94-402, eff. 8-2-05; 94-584, eff. 8-15-05;
8 94-906, eff. 1-1-07; 94-921, eff. 6-26-06; 95-331, eff.
9 8-21-07; 95-972, eff. 9-22-08; 95-973, eff. 1-1-09; revised
10 10-14-08.)
11     (215 ILCS 5/Art. XLV heading new)

13     (215 ILCS 5/1501 new)
14     Sec. 1501. Short title. This Law may be cited as the
15 Minimum Medical Loss Ratio Law.
16     (215 ILCS 5/1505 new)
17     Sec. 1505. Purpose. The General Assembly recognizes that a
18 significant share of the premium dollars paid by individuals
19 and small employers to health insurers and health maintenance
20 organizations is directed toward administrative and marketing
21 activities and profit. It is the intent of this Law to ensure
22 that premium costs for consumers more accurately reflect the
23 value of health care they receive by increasing the portion of



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1 premium dollars dedicated to medical services.
2     (215 ILCS 5/1510 new)
3     Sec. 1510. Definitions. In this Law:
4     "Company" means any entity that provides health insurance
5 in this State. For the purposes of this Law, company includes a
6 licensed insurance company, a health maintenance organization,
7 or any other entity providing a plan of health insurance or
8 health benefits subject to State insurance regulation.
9     "Division" means the Division of Insurance within the
10 Illinois Department of Financial and Professional Regulation.
11     "Health benefit plan" means any hospital or medical
12 expense-incurred policy, hospital or medical service plan
13 contract, or health maintenance organization subscriber
14 contract. "Health benefit plan" shall not include
15 accident-only, credit, dental, vision, Medicare supplement,
16 hospital indemnity, long term care, specific disease, stop loss
17 or disability income insurance, coverage issued as a supplement
18 to liability insurance, workers' compensation or similar
19 insurance, or automobile medical payment insurance.
20     "Health care benefits" means health care services that are
21 either provided or reimbursed by a managed care entity or its
22 contracted providers as benefits to its policyholders and
23 insurers. Health care benefits shall include:
24         (A) The costs of programs or activities, including
25     training and the provision of informational materials that



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1     are determined as part of the regulation to improve the
2     provision of quality care, improve health care outcomes, or
3     encourage the use of evidence-based medicine.
4         (B) Disease management expenses using cost-effective
5     evidence-based guidelines.
6         (C) Plan medical advice by telephone.
7         (D) Payments to providers as risk pool payments of
8     pay-for-performance initiatives.
9 "Health care benefits" shall not include administrative costs
10 as determined by the Division.
11     "Individual market" means the individual market as defined
12 by the Illinois Health Insurance Portability and
13 Accountability Act.
14     "Small group market" means "small group market" as defined
15 by the Illinois Health Insurance Portability and
16 Accountability Act.
17     (215 ILCS 5/1515 new)
18     Sec. 1515. Minimum medical loss requirement for companies
19 offering coverage in the individual and small group market.
20     (a) Any company selling a health benefit plan in the
21 individual or small group market shall, on and after June 1,
22 2011, expend in the form of health care benefits no less than
23 75% of the aggregate dues, fees, premiums, or other periodic
24 payments received by the company. For purposes of this Section,
25 the company may deduct from the aggregate dues, fees, premiums,



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1 or other periodic payments received by the company the amount
2 of income taxes or other taxes that the company expensed.
3     (b) To assess compliance with this Section, a company with
4 a valid certificate of authority may average its total costs
5 across all health benefit plans issued, amended, or renewed in
6 Illinois, and all health benefit plans issued, amended, or
7 renewed by its affiliated companies that are licensed to
8 operate in Illinois.
9     (c) The Division shall adopt rules to implement this
10 Section and to establish uniform reporting by companies of the
11 information necessary to determine compliance with this
12 Section.
13     (d) The Division may exclude from the determination of
14 compliance with the requirement of subsection (a) of this
15 Section any new health benefit plans for up to the first 2
16 years that these health benefit plans are offered for sale in
17 Illinois, provided that the Division determines that the new
18 health benefit plans are substantially different from the
19 existing health benefit plans being issued, amended, or renewed
20 by the company seeking the exclusion.
21     Section 10. The Managed Care Reform and Patient Rights Act
22 is amended by changing Section 90 as follows:
23     (215 ILCS 134/90)
24     Sec. 90. Office of Consumer Health Insurance.



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1     (a) The Director of Insurance shall establish the Office of
2 Consumer Health Insurance within the Department of Insurance to
3 provide assistance and information to all health care consumers
4 within the State and to ensure that persons covered by health
5 insurance companies or health care plans are provided benefits
6 due under the Illinois Insurance Code and related statutes and
7 are protected from health insurance company and health care
8 plan actions or policy provisions that are unjust, unfair,
9 inequitable, ambiguous, misleading, inconsistent, deceptive,
10 or contrary to the law or to the public policy of this State or
11 that unreasonably or deceptively affect the risk purposed to be
12 assumed. Within the appropriation allocated, the Office shall
13 provide information and assistance to all health care
14 consumers. by The responsibilities of the Office shall include,
15 but not be limited to, the following:
16         (1) assisting consumers in understanding health
17     insurance marketing materials and the coverage provisions
18     of individual plans;
19         (2) educating enrollees about their rights within
20     individual plans;
21         (3) assisting enrollees with the process of filing
22     formal grievances and appeals;
23         (4) establishing and operating a toll-free "800"
24     telephone number line to handle consumer inquiries;
25         (5) making related information available in languages
26     other than English that are spoken as a primary language by



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1     a significant portion of the State's population, as
2     determined by the Department;
3         (6) analyzing, commenting on, monitoring, and making
4     publicly available reports on the development and
5     implementation of federal, State, and local laws,
6     regulations, and other governmental policies and actions
7     that pertain to the adequacy of health care plans,
8     facilities, and services in the State;
9         (7) filing an annual report with the Governor, the
10     Director, and the General Assembly, which shall contain
11     recommendations for improvement of the regulation of
12     health insurance plans, including recommendations on
13     improving health care consumer assistance and patterns,
14     abuses, and progress that it has identified from its
15     interaction with health care consumers; and
16         (8) performing oversight of health insurance companies
17     and health care plans with respect to:
18             (A) improper claims practices as set forth in
19         Sections 154.5 and 154.6 of the Illinois Insurance
20         Code;
21             (B) emergency services;
22             (C) compliance with this Act;
23             (D) ensuring proper coverage for mental health
24         treatment;
25             (E) reviewing insurance company and health care
26         plan underwriting, rating, and rescission practices;



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1         and
2             (F) reviewing insurance company and health care
3         plan billing practices, including, but not limited to,
4         consumer cost-sharing that results from co-pay,
5         deductible, and provider network provisions;
6         (9) assisting health insurance company and health care
7     plan consumers with respect to the exercise of the
8     grievance and appeals rights established in this Act;
9         (10) if an external independent review decision
10     upholds a determination adverse to the patient, the patient
11     has the right to appeal the final decision to the Office;
12     if the external review decision is found by the Director
13     through the Office to have been arbitrary and capricious,
14     then the Director, with consultation from a licensed
15     medical professional, may overturn the external review
16     decision and require the health insurance company or health
17     care plan to pay for the health care service or treatment;
18     such decision, if any, shall be made solely on the legal or
19     medical merits of the claim; and
20         (11) (8) performing all duties assigned to the Office
21     by the Director.
22     (b) The report required under subsection (a)(7) shall be
23 filed by January 31, 2001 and each January 31 thereafter.
24     (c) Nothing in this Section shall be interpreted to
25 authorize access to or disclosure of individual patient or
26 health care professional or provider records.



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1     (d) The Director, in his or her discretion, may issue a
2 Notice of Hearing requiring a health insurance company or
3 health care plan to appear at a hearing for the purpose of
4 determining the health insurance company or health care plan's
5 compliance with the duties and responsibilities listed in this
6 Act and in the Illinois Insurance Code.
7     (e) Nothing in this Section shall diminish or affect the
8 powers and authority of the Director of Insurance otherwise set
9 forth in this Act and in the Illinois Insurance Code.
10 (Source: P.A. 91-617, eff. 1-1-00.)
11     Section 99. Effective date. This Act takes effect January
12 1, 2010.".