State of Illinois
90th General Assembly
Legislation

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[ Introduced ][ Engrossed ][ Senate Amendment 001 ]

90_HB0705enr

      215 ILCS 5/356t new
      215 ILCS 125/5-3          from Ch. 111 1/2, par. 1411.2
      215 ILCS 130/3009         from Ch. 73, par. 1503-9
      215 ILCS 165/10           from Ch. 32, par. 604
          Amends the Illinois Insurance  Code,  Health  Maintenance
      Organization  Act,  Limited  Health Service Organization Act,
      and Voluntary  Health  Services  Plans  Act.   Provides  that
      health   benefit  coverage  under  those  Acts  must  include
      coverage for child health supervision services  for  children
      under  the  age  of  6.   Child  health  supervision services
      provide for a periodic  review  of  a  child's  physical  and
      emotional  status  by  a  physician  or  under  a physician's
      supervision. Defines terms.  Effective immediately.
                                                     LRB9002464JScc
HB0705 Enrolled                                LRB9002464JScc
 1        AN ACT regarding health insurance for children.
 2        Be it enacted by the People of  the  State  of  Illinois,
 3    represented in the General Assembly:
 4        Section  1.   Short  title.  This Act may be cited as the
 5    Children's Health Insurance Program Act.
 6        Section 5.  Legislative  intent.   The  General  Assembly
 7    finds  that,  for  the  economic  and  social  benefit of all
 8    citizens of the State, it is important to  enable  low-income
 9    children  of  this  State,  to the extent funding permits, to
10    access health benefits coverage, especially preventive health
11    care.  The General Assembly  recognizes  that  assistance  to
12    help   families   purchase  health  benefits  for  low-income
13    children must be provided in a fair and equitable fashion and
14    must treat all children at the same income level in a similar
15    fashion.   The  State  of  Illinois  should  help  low-income
16    families  transition  from  a  health   care   system   where
17    government  partners with families to provide health benefits
18    to low-income children to a system where families with higher
19    incomes eventually transition into private or employer  based
20    health  plans.   This  Act  is  not  intended  to  create  an
21    entitlement.
22        Section 10.  Definitions.  As used in this Act:
23        "Benchmarking"  means health benefits coverage as defined
24    in Section 2103 of the Social Security Act.
25        "Child" means a person under the age of 19.
26        "Department" means the Department of Public Aid.
27        "Medical assistance" means health care benefits  provided
28    under Article V of the Illinois Public Aid Code.
29        "Medical  visit"  means  a  hospital,  dental, physician,
30    optical, or  other  health  care  visit  where  services  are
HB0705 Enrolled            -2-                 LRB9002464JScc
 1    provided pursuant to this Act.
 2        "Program"  means the Children's Health Insurance Program,
 3    which includes subsidizing the cost  of  privately  sponsored
 4    health  insurance  and  purchasing  or  providing health care
 5    benefits for eligible children.
 6        "Resident"  means  a  person  who  meets  the   residency
 7    requirements as defined in Section 5-3 of the Illinois Public
 8    Aid Code.
 9        Section  15.   Operation of the Program.  There is hereby
10    created a Children's Health Insurance Program.   The  Program
11    shall   operate   subject   to  appropriation  and  shall  be
12    administered by the Department of Public Aid.  The Department
13    shall have the powers and authority granted to the Department
14    under the Illinois  Public  Aid  Code.   The  Department  may
15    contract  with  a Third Party Administrator or other entities
16    to administer and oversee any portion of this Program.
17        Section 20.  Eligibility.
18        (a)  To be eligible for this Program, a person must be  a
19    person  who  has  a  child eligible under this Act and who is
20    eligible under a waiver of federal requirements  pursuant  to
21    an application made pursuant to subdivision (a)(1) of Section
22    40 of this Act or who is a child who:
23             (1)  is  a  child  who  is  not eligible for medical
24        assistance;
25             (2)  is a child whose annual  household  income,  as
26        determined  by  the  Department,  is  above  133%  of the
27        federal poverty level and at or below 185% of the federal
28        poverty level;
29             (3)  is a  resident of the State of Illinois; and
30             (4)  is a  child  who  is  either  a  United  States
31        citizen or included in one of the following categories of
32        non-citizens:
HB0705 Enrolled            -3-                 LRB9002464JScc
 1                  (A)  unmarried  dependent  children of either a
 2             United States  Veteran  honorably  discharged  or  a
 3             person on active military duty;
 4                  (B)  refugees   under   Section   207   of  the
 5             Immigration and Nationality Act;
 6                  (C)  asylees   under   Section   208   of   the
 7             Immigration and Nationality Act;
 8                  (D)  persons  for  whom  deportation  has  been
 9             withheld under Section  243(h)  of  the  Immigration
10             and Nationality Act;
11                  (E)  persons  granted  conditional  entry under
12             Section 203(a)(7) of the Immigration and Nationality
13             Act as in effect prior to April 1, 1980;
14                  (F)  persons lawfully  admitted  for  permanent
15             residence under the Immigration and Nationality Act;
16             and
17                  (G)  parolees,  for  at  least  one year, under
18             Section 212(d)(5) of the Immigration and Nationality
19             Act.
20        Those children who are in the  categories  set  forth  in
21    subdivisions  (4)(F) and (4)(G) of this subsection, who enter
22    the United States on or after August 22, 1996, shall  not  be
23    eligible  for 5 years beginning on the date the child entered
24    the United States.
25        (b)  A  child  who  is  determined  to  be  eligible  for
26    assistance shall remain eligible for 12 months, provided  the
27    child  maintains  his  or her residence in the State, has not
28    yet attained 19 years of age, and is not excluded pursuant to
29    subsection (c).  Eligibility shall be  re-determined  by  the
30    Department at least annually.
31        (c)  A  child  shall  not  be eligible for coverage under
32    this Program if:
33             (1)  the premium required pursuant to Section 30  of
34        this Act has not been paid.  If the required premiums are
HB0705 Enrolled            -4-                 LRB9002464JScc
 1        not paid the liability of the Program shall be limited to
 2        benefits  incurred  under the Program for the time period
 3        for which  premiums  had  been  paid.   If  the  required
 4        monthly   premium   is  not  paid,  the  child  shall  be
 5        ineligible for re-enrollment for a minimum  period  of  3
 6        months.   Re-enrollment  shall  be completed prior to the
 7        next covered medical visit and the first month's required
 8        premium shall be paid in  advance  of  the  next  covered
 9        medical  visit.   The  Department  shall promulgate rules
10        regarding grace periods, notice requirements, and hearing
11        procedures pursuant to this subsection;
12             (2)  the child is an inmate of a public  institution
13        or a patient in an institution for mental diseases; or
14             (3)  the  child  is  a  member  of  a family that is
15        eligible for health benefits covered under the  State  of
16        Illinois  health benefits plan on the basis of a member's
17        employment with a public agency.
18        Section 25.  Health benefits for children.
19        (a)  The  Department  shall,  subject  to  appropriation,
20    provide health benefits coverage to eligible children by:
21             (1)  Subsidizing the  cost  of  privately  sponsored
22        health   insurance,   including   employer  based  health
23        insurance,  to  assist  families  to  take  advantage  of
24        available privately sponsored health insurance for  their
25        eligible children; and
26             (2)  Purchasing  or  providing  health care benefits
27        for eligible  children.   The  health  benefits  provided
28        under   this   subdivision   (a)(2)   shall,  subject  to
29        appropriation and without regard to any  applicable  cost
30        sharing  under  Section  30, be identical to the benefits
31        provided for children under  the  State's  approved  plan
32        under  Title  XIX  of the Social Security Act.  Providers
33        under  this  subdivision  (a)(2)  shall  be  subject   to
HB0705 Enrolled            -5-                 LRB9002464JScc
 1        approval  by  the Department to provide health care under
 2        the Illinois Public Aid Code and shall be  reimbursed  at
 3        the  same  rate  as  providers under the State's approved
 4        plan under Title XIX  of  the  Social  Security  Act.  In
 5        addition,   providers   may   retain   co-payments   when
 6        determined appropriate by the Department.
 7        (b)  The  subsidization  provided pursuant to subdivision
 8    (a)(1) shall be credited to the family of the eligible child.
 9        (c)  The Department is prohibited from  denying  coverage
10    to  a  child  who is enrolled in a privately sponsored health
11    insurance plan pursuant to  subdivision  (a)(1)  because  the
12    plan  does  not  meet  federal benchmarking standards or cost
13    sharing and contribution requirements.  To  be  eligible  for
14    inclusion   in   the   Program,   the   plan   shall  contain
15    comprehensive major medical coverage which shall  consist  of
16    physician  and hospital inpatient services. The Department is
17    prohibited from denying coverage to a child who  is  enrolled
18    in  a  privately  sponsored health insurance plan pursuant to
19    subdivision  (a)(1)  because  the  plan  offers  benefits  in
20    addition to physician and hospital inpatient services.
21        (d)  The total dollar amount of subsidizing coverage  per
22    child per month pursuant to subdivision (a)(1) shall be equal
23    to  the  average dollar payments, less premiums incurred, per
24    child  per  month  pursuant  to  subdivision  (a)(2).     The
25    Department shall set this amount prospectively based upon the
26    prior  fiscal year's experience adjusted for incurred but not
27    reported claims and estimated increases or decreases  in  the
28    cost  of  medical  care.   Payments  obligated before July 1,
29    1999, will be computed using State Fiscal Year 1996  payments
30    for  children  eligible  for  Medical  Assistance  and income
31    assistance under the Aid to Families with Dependent  Children
32    Program,   with   appropriate   adjustments   for   cost  and
33    utilization changes through January 1, 1999.  The  Department
34    is   prohibited   from   providing   a  subsidy  pursuant  to
HB0705 Enrolled            -6-                 LRB9002464JScc
 1    subdivision (a)(1) that is more than the individual's monthly
 2    portion of the premium.
 3        (e)  An eligible  child  may  obtain  immediate  coverage
 4    under  this  Program  only  once  during a medical visit.  If
 5    coverage lapses, re-enrollment shall be completed in  advance
 6    of  the  next  covered  medical  visit  and the first month's
 7    required premium shall be paid  in  advance  of  any  covered
 8    medical visit.
 9        (f)  In   order   to   accelerate   and   facilitate  the
10    development of networks to deliver services  to  children  in
11    areas   outside   counties  with  populations  in  excess  of
12    3,000,000, in  the  event  less  than  25%  of  the  eligible
13    children in a county or contiguous counties has enrolled with
14    a Health Maintenance Organization pursuant to Section 5-11 of
15    the  Illinois Public Aid Code, the Department may develop and
16    implement  demonstration  projects  to   create   alternative
17    networks  designed to enhance enrollment and participation in
18    the program.  The Department  shall  prescribe  by  rule  the
19    criteria,    standards,    and   procedures   for   effecting
20    demonstration projects under this Section.
21        Section 30.  Cost sharing.
22        (a)  Children  enrolled  in  a  health  benefits  program
23    pursuant to subdivision (a)(2) of Section 25 shall be subject
24    to the following cost sharing requirements:
25             (1)  There  shall  be  no  co-payment  required  for
26        well-baby or well-child care,  including  age-appropriate
27        immunizations as required under federal law.
28             (2)  Health   insurance  premiums  for  children  in
29        families whose household income is at or  above  150%  of
30        the  federal  poverty  level  shall  be  payable monthly,
31        subject to rules promulgated by the Department for  grace
32        periods and advance payments, and shall be as follows:
33                  (A)  $15 per month for one child.
HB0705 Enrolled            -7-                 LRB9002464JScc
 1                  (B)  $25 per month for 2 children.
 2                  (C)  $30 per month for 3 or more children.
 3             (3)  Co-payments  for  children  in  families  whose
 4        income  is  below 150% of the federal poverty level, at a
 5        minimum and to the extent permitted  under  federal  law,
 6        shall  be  $2  for  all  medical visits and prescriptions
 7        provided under this Act.
 8             (4)  Co-payments  for  children  in  families  whose
 9        income is at or above 150% of the federal poverty  level,
10        at  a  minimum  and to the extent permitted under federal
11        law shall be as follows:
12                  (A)  $5 for medical visits.
13                  (B)  $3 for generic prescriptions  and  $5  for
14             brand name prescriptions.
15                  (C)  $25   for   emergency   room   use  for  a
16             non-emergency situation as defined by the Department
17             by rule.
18             (5)  The maximum amount  of  out-of-pocket  expenses
19        for co-payments shall be $100 per family per year.
20        (b)  Individuals enrolled in a privately sponsored health
21    insurance  plan  pursuant to subdivision (a)(1) of Section 25
22    shall be subject to the cost sharing provisions as stated  in
23    the privately sponsored health insurance plan.
24        Section 35.  Funding.
25        (a)  This  Program is not an entitlement and shall not be
26    construed to create  an  entitlement.   Eligibility  for  the
27    Program is subject to appropriation of funds by the State and
28    federal  governments.  Subdivision (a)(2) of Section 25 shall
29    operate and be funded only if subdivision (a)(1)  of  Section
30    25  is  operational and funded. The estimated net State share
31    of appropriated funds for subdivision (a)(2)  of  Section  25
32    shall   be   equal  to  the  estimated  net  State  share  of
33    appropriated funds for subdivision (a)(1) of Section 25.
HB0705 Enrolled            -8-                 LRB9002464JScc
 1        (b)  Any requirement  imposed  under  this  Act  and  any
 2    implementation  of  this Act by the Department shall cease in
 3    the  event  (1)  continued  receipt  of  federal  funds   for
 4    implementation of this Act requires an amendment to this Act,
 5    or  (2)  federal  funds for implementation of the Act are not
 6    otherwise available.
 7        (c)  Payments under this Act shall be  appropriated  from
 8    the General Revenue Fund.
 9        (d)  Benefits  under  this Act shall be available only as
10    long as the intergovernmental  agreements  made  pursuant  to
11    Section 12-4.7 and Article XV of the Illinois Public Aid Code
12    and  entered  into between the Department and the Cook County
13    Board of Commissioners continue to exist.
14        Section 40.  Waivers.
15        (a)  The Department shall request any  necessary  waivers
16    of  federal requirements in order to allow receipt of federal
17    funding for:
18             (1)  the coverage of families with eligible children
19        under this Act; and
20             (2)  for  the  coverage  of   children   who   would
21        otherwise be eligible under this Act, but who have health
22        insurance.
23        (b)  The  failure  of  the  responsible federal agency to
24    approve a waiver for children who would otherwise be eligible
25    under this Act  but  who  have  health  insurance  shall  not
26    prevent  the  implementation  of  any  Section  of  this  Act
27    provided that there are sufficient appropriated funds.
28        Section 45.  Study.
29        (a)  The Department shall conduct a study which includes,
30    but is not limited to, the following:
31             (1)  Establishes  estimates,  broken down by regions
32        of the State, of  the  number  of  children  with  health
HB0705 Enrolled            -9-                 LRB9002464JScc
 1        insurance coverage and without health insurance coverage;
 2        the number of children who are eligible for Medicaid, and
 3        of  that number, the number who are enrolled in Medicaid;
 4        the number of children with access to dependent  coverage
 5        through  an  employer, and of that number, the number who
 6        are enrolled in dependent coverage through an employer.
 7             (2)  Ascertains,  for  the  population  of  children
 8        potentially eligible for coverage under any component  of
 9        the  Program, the extent of access to dependent coverage,
10        how many children are enrolled in dependent coverage, the
11        comprehensiveness of dependent coverage benefit  packages
12        available,  and the amount of cost sharing currently paid
13        by the employees.
14        (b)  The Department shall submit the preliminary  results
15    of  the  study  to  the  Governor and the General Assembly by
16    December 1, 1998 and shall submit the final  results  to  the
17    Governor and the General Assembly by May 1, 1999.
18        Section  50.   Program  evaluation.  The Department shall
19    conduct 2 evaluations of the  effectiveness  of  the  program
20    implemented  under  this  Act.  The first evaluation shall be
21    for the first  6  full  months  of  implementation,  and  the
22    evaluation  shall  be  completed  within  90  days after that
23    period.  The second evaluation shall be for the first 12 full
24    months of implementation and shall  be  completed  within  90
25    days after that period.
26        Section 55.  Contracts with non-governmental bodies.  All
27    contracts with non-governmental bodies that are determined by
28    the Department to be necessary for the implementation of this
29    Section  are  deemed to be purchase of care as defined in the
30    Illinois Procurement Code.
31        Section 60.  Emergency rulemaking.   Prior  to  June  30,
HB0705 Enrolled            -10-                LRB9002464JScc
 1    1999,  the  Department may adopt rules necessary to establish
 2    and implement this  Section  through  the  use  of  emergency
 3    rulemaking  in  accordance  with Section 5-45 of the Illinois
 4    Administrative Procedure Act.  For purposes of that Act,  the
 5    General   Assembly  finds  that  the  adoption  of  rules  to
 6    implement this Section is deemed an emergency  and  necessary
 7    for the public interest, safety, and welfare.
 8        Section  96.  Inseverability.  The provisions of this Act
 9    are mutually dependent and inseverable.  If any provision  or
10    its  application  to  any  person  or  circumstance  is  held
11    invalid, then this entire Act is invalid.
12        Section  97.  Repealer.  This Act is repealed on June 30,
13    2001.
14        Section 98.  The Illinois  Health  Insurance  Portability
15    and  Accountability  Act is amended by changing Section 20 as
16    follows:
17        (215 ILCS 97/20)
18        Sec. 20.  Increased  portability  through  limitation  on
19    preexisting condition exclusions.
20        (A)  Limitation   of   preexisting   condition  exclusion
21    period; crediting for periods of previous coverage.   Subject
22    to  subsection  (D),  a  group  health  plan,  and  a  health
23    insurance  issuer  offering  group health insurance coverage,
24    may, with respect to a participant or beneficiary,  impose  a
25    preexisting condition exclusion only if:
26             (1)  the  exclusion  relates to a condition (whether
27        physical or mental),  regardless  of  the  cause  of  the
28        condition,  for which medical advice, diagnosis, care, or
29        treatment was recommended or received within the  6-month
30        period ending on the enrollment date;
HB0705 Enrolled            -11-                LRB9002464JScc
 1             (2)  the  exclusion extends for a period of not more
 2        than 12 months (or 18  months  in  the  case  of  a  late
 3        enrollee) after the enrollment date; and
 4             (3)  the  period  of  any such preexisting condition
 5        exclusion is reduced by the aggregate of the  periods  of
 6        creditable  coverage  (if  any,  as defined in subsection
 7        (C)(1)) applicable to the participant or  beneficiary  as
 8        of the enrollment date.
 9        (B)  Preexisting  condition  exclusion.   A  group health
10    plan, and  health  insurance  issuer  offering  group  health
11    insurance  coverage, may not impose any preexisting condition
12    exclusion relating to pregnancy as a preexisting condition.
13        Genetic information shall not be treated as  a  condition
14    described  in subsection (A)(1) in the absence of a diagnosis
15    of the condition related to such information.
16        (C)  Rules relating to crediting previous coverage.
17             (1)  Creditable coverage defined.  For  purposes  of
18        this  Act,  the  term  "creditable  coverage" means, with
19        respect to an  individual,  coverage  of  the  individual
20        under any of the following:
21                  (a)  A group health plan.
22                  (b)  Health insurance coverage.
23                  (c)  Part  A  or  part  B of title XVIII of the
24             Social Security Act.
25                  (d)  Title XIX  of  the  Social  Security  Act,
26             other  than  coverage  consisting solely of benefits
27             under Section 1928.
28                  (e)  Chapter 55  of  title  10,  United  States
29             Code.
30                  (f)  A  medical  care  program  of  the  Indian
31             Health Service or of a tribal organization.
32                  (g)  A State health benefits risk pool.
33                  (h)  A  health plan offered under chapter 89 of
34             title 5, United States Code.
HB0705 Enrolled            -12-                LRB9002464JScc
 1                  (i)  A  public  health  plan  (as  defined   in
 2             regulations).
 3                  (j)  A  health  benefit plan under Section 5(e)
 4             of the Peace Corps Act (22 U.S.C. 2504(e)).
 5                  (k)  Title XXI of the federal  Social  Security
 6             Act, State Children's Health Insurance Program.
 7             Such  term  does  not  include  coverage  consisting
 8        solely of coverage of excepted benefits.
 9             (2)  Excepted  benefits.   For purposes of this Act,
10        the term "excepted benefits" means benefits under one  or
11        more of the following:
12                  (a)  Benefits not subject to requirements:
13                       (i)  Coverage   only   for   accident,  or
14                  disability income insurance, or any combination
15                  thereof.
16                       (ii)  Coverage issued as a  supplement  to
17                  liability insurance.
18                       (iii)  Liability    insurance,   including
19                  general  liability  insurance  and   automobile
20                  liability insurance.
21                       (iv)  Workers'   compensation  or  similar
22                  insurance.
23                       (v)  Automobile medical payment insurance.
24                       (vi)  Credit-only insurance.
25                       (vii)  Coverage   for   on-site    medical
26                  clinics.
27                       (viii)  Other  similar insurance coverage,
28                  specified in regulations, under which  benefits
29                  for medical care are secondary or incidental to
30                  other insurance benefits.
31                  (b)  Benefits  not  subject  to requirements if
32             offered separately:
33                       (i)  Limited  scope   dental   or   vision
34                  benefits.
HB0705 Enrolled            -13-                LRB9002464JScc
 1                       (ii)  Benefits for long-term care, nursing
 2                  home  care,  home  health care, community-based
 3                  care, or any combination thereof.
 4                       (iii)  Such   other    similar,    limited
 5                  benefits as are specified in rules.
 6                  (c)  Benefits  not  subject  to requirements if
 7             offered, as independent, noncoordinated benefits:
 8                       (i)  Coverage only for a specified disease
 9                  or illness.
10                       (ii)  Hospital indemnity  or  other  fixed
11                  indemnity insurance.
12                  (d)  Benefits  not  subject  to requirements if
13             offered  as  separate  insurance  policy.   Medicare
14             supplemental  health  insurance  (as  defined  under
15             Section 1882(g)(1)  of  the  Social  Security  Act),
16             coverage supplemental to the coverage provided under
17             chapter  55  of  title  10,  United States Code, and
18             similar supplemental coverage provided  to  coverage
19             under a group health plan.
20             (3)  Not  counting periods before significant breaks
21        in coverage.
22                  (a)  In  general.   A  period   of   creditable
23             coverage  shall  not  be  counted,  with  respect to
24             enrollment of an individual  under  a  group  health
25             plan,   if,   after   such  period  and  before  the
26             enrollment date, there was a 63- day  period  during
27             all  of  which  the individual was not covered under
28             any creditable coverage.
29                  (b)  Waiting period not treated as a  break  in
30             coverage.   For  purposes  of  subparagraph  (a) and
31             subsection (D)(3), any period that an individual  is
32             in  a  waiting period for any coverage under a group
33             health plan (or for group health insurance coverage)
34             or is  in  an  affiliation  period  (as  defined  in
HB0705 Enrolled            -14-                LRB9002464JScc
 1             subsection  (G)(2))  shall not be taken into account
 2             in   determining   the   continuous   period   under
 3             subparagraph (a).
 4             (4)  Method of crediting coverage.
 5                  (a)  Standard  method.   Except  as   otherwise
 6             provided  under  subparagraph  (b),  for purposes of
 7             applying subsection (A)(3), a group health plan, and
 8             a health  insurance  issuer  offering  group  health
 9             insurance   coverage,   shall   count  a  period  of
10             creditable coverage without regard to  the  specific
11             benefits covered during the period.
12                  (b)  Election  of  alternative method.  A group
13             health plan, or a health insurance  issuer  offering
14             group   health   insurance,   may   elect  to  apply
15             subsection (A)(3)  based  on  coverage  of  benefits
16             within  each  of  several  classes  or categories of
17             benefits specified in  regulations  rather  than  as
18             provided  under  subparagraph  (a).   Such  election
19             shall   be   made   on   a  uniform  basis  for  all
20             participants and beneficiaries.  Under such election
21             a group health plan or issuer shall count  a  period
22             of  creditable coverage with respect to any class or
23             category of benefits if any  level  of  benefits  is
24             covered within such class or category.
25                  (c)  Plan  notice.   In the case of an election
26             with  respect  to  a   group   health   plan   under
27             subparagraph  (b)  (whether  or not health insurance
28             coverage is provided in connection with such  plan),
29             the plan shall:
30                       (i)  prominently  state  in any disclosure
31                  statements concerning the plan,  and  state  to
32                  each  enrollee  at the time of enrollment under
33                  the plan, that the plan has made such election;
34                  and
HB0705 Enrolled            -15-                LRB9002464JScc
 1                       (ii)  include   in   such   statements   a
 2                  description of the effect of this election.
 3                  (d)  Issuer notice.  In the case of an election
 4             under  subparagraph  (b)  with  respect  to   health
 5             insurance coverage offered by an issuer in the small
 6             or large group market, the issuer:
 7                       (i)  shall   prominently   state   in  any
 8                  disclosure statements concerning the  coverage,
 9                  and  to  each employer at the time of the offer
10                  or sale of the coverage, that  the  issuer  has
11                  made such election; and
12                       (ii)  shall  include  in such statements a
13                  description of the effect of such election.
14             (5)  Establishment of period.  Periods of creditable
15        coverage  with  respect  to  an   individual   shall   be
16        established   through   presentation   or  certifications
17        described in subsection (E) or in such  other  manner  as
18        may be specified in regulations.
19        (D)  Exceptions:
20             (1)  Exclusion  not  applicable to certain newborns.
21        Subject to paragraph (3), a  group  health  plan,  and  a
22        health  insurance  issuer offering group health insurance
23        coverage,  may  not  impose  any  preexisting   condition
24        exclusion  in  the  case  of an individual who, as of the
25        last day of the 30-day period beginning with the date  of
26        birth, is covered under creditable coverage.
27             (2)  Exclusion  not  applicable  to  certain adopted
28        children.  Subject to paragraph (3), a group health plan,
29        and a  health  insurance  issuer  offering  group  health
30        insurance   coverage,  may  not  impose  any  preexisting
31        condition exclusion in the case of a child who is adopted
32        or placed for adoption before attaining 18 years  of  age
33        and  who,  as  of  the  last  day  of  the  30-day period
34        beginning on the date of the adoption  or  placement  for
HB0705 Enrolled            -16-                LRB9002464JScc
 1        adoption, is covered under creditable coverage.
 2             The  previous  sentence  shall not apply to coverage
 3        before  the  date  of  such  adoption  or  placement  for
 4        adoption.
 5             (3)  Loss if break in coverage.  Paragraphs (1)  and
 6        (2)  shall no longer apply to an individual after the end
 7        of the first  63-day  period  during  all  of  which  the
 8        individual was not covered under any creditable coverage.
 9        (E)  Certifications and disclosure of coverage.
10             (1)  Requirement  for  Certification  of  Period  of
11        Creditable Coverage.
12                  (a)  A   group   health   plan,  and  a  health
13             insurance issuer  offering  group  health  insurance
14             coverage,  shall provide the certification described
15             in subparagraph (b):
16                       (i)  at the time an individual  ceases  to
17                  be  covered under the plan or otherwise becomes
18                  covered under a COBRA continuation provision;
19                       (ii)  in  the  case   of   an   individual
20                  becoming covered under such a provision, at the
21                  time  the individual ceases to be covered under
22                  such provision; and
23                       (iii)  on the  request  on  behalf  of  an
24                  individual  made not later than 24 months after
25                  the date of cessation of the coverage described
26                  in clause (i) or (ii), whichever is later.
27             The certification under clause (i) may be  provided,
28             to the extent practicable, at a time consistent with
29             notices   required   under   any   applicable  COBRA
30             continuation provision.
31                  (b)  The  certification   described   in   this
32             subparagraph is a written certification  of:
33                       (i)  the  period of creditable coverage of
34                  the individual under such plan and the coverage
HB0705 Enrolled            -17-                LRB9002464JScc
 1                  (if  any)   under   such   COBRA   continuation
 2                  provision; and
 3                       (ii)  the  waiting  period  (if  any) (and
 4                  affiliation period, if applicable) imposed with
 5                  respect to  the  individual  for  any  coverage
 6                  under such plan.
 7                  (c)  To  the  extent  that medical care under a
 8             group health plan consists of group health insurance
 9             coverage, the plan is deemed to have  satisfied  the
10             certification  requirement  under  this paragraph if
11             the health insurance issuer  offering  the  coverage
12             provides  for  such certification in accordance with
13             this paragraph.
14             (2)  Disclosure of information on previous benefits.
15        In the  case  of  an  election  described  in  subsection
16        (C)(4)(b)  by  a  group  health  plan or health insurance
17        issuer, if the plan or issuer enrolls an  individual  for
18        coverage  under  the  plan  and the individual provides a
19        certification  of  coverage  of  the   individual   under
20        paragraph (1):
21                  (a)  upon  request  of such plan or issuer, the
22             entity which issued the  certification  provided  by
23             the  individual  shall  promptly  disclose  to  such
24             requesting plan or issuer information on coverage of
25             classes  and categories of health benefits available
26             under such entity's plan or coverage; and
27                  (b)  such entity may charge the requesting plan
28             or issuer for the reasonable cost of disclosing such
29             information.
30             (3)  Rules.  The Department shall establish rules to
31        prevent an entity's failure to provide information  under
32        paragraph (1) or (2) with respect to previous coverage of
33        an  individual  from  adversely  affecting any subsequent
34        coverage of the individual  under  another  group  health
HB0705 Enrolled            -18-                LRB9002464JScc
 1        plan or health insurance coverage.
 2             (4)  Treatment of certain plans as group health plan
 3        for  notice  provision.  A program under which creditable
 4        coverage described in subparagraph (c), (d), (e), or  (f)
 5        of  Section  20(C)(1)  is  provided shall be treated as a
 6        group health plan for purposes of this Section.
 7        (F)  Special enrollment periods.
 8             (1)  Individuals losing  other  coverage.   A  group
 9        health plan, and a health insurance issuer offering group
10        health  insurance  coverage  in  connection  with a group
11        health plan, shall permit an employee  who  is  eligible,
12        but  not  enrolled,  for  coverage under the terms of the
13        plan (or a dependent of such an employee if the dependent
14        is eligible, but not enrolled, for  coverage  under  such
15        terms) to enroll for coverage under the terms of the plan
16        if each of the following conditions is met:
17                  (a)  The  employee  or  dependent  was  covered
18             under  a  group  health plan or had health insurance
19             coverage at the time coverage was previously offered
20             to the employee or dependent.
21                  (b)  The employee stated  in  writing  at  such
22             time  that  coverage  under  a  group health plan or
23             health  insurance  coverage  was  the   reason   for
24             declining  enrollment,  but only if the plan sponsor
25             or issuer (if applicable) required such a  statement
26             at  such  time and provided the employee with notice
27             of such requirement (and the  consequences  of  such
28             requirement) at such time.
29                  (c)  The  employee's  or  dependent's  coverage
30             described in subparagraph (a):
31                       (i)  was   under   a   COBRA  continuation
32                  provision and the coverage under such provision
33                  was exhausted; or
34                       (ii)  was not under such a  provision  and
HB0705 Enrolled            -19-                LRB9002464JScc
 1                  either  the coverage was terminated as a result
 2                  of  loss  of  eligibility  for   the   coverage
 3                  (including  as  a  result  of legal separation,
 4                  divorce, death, termination of  employment,  or
 5                  reduction in the number of hours of employment)
 6                  or employer contributions towards such coverage
 7                  were terminated.
 8                  (d)  Under  the terms of the plan, the employee
 9             requests such enrollment  not  later  than  30  days
10             after  the  date of exhaustion of coverage described
11             in subparagraph (c)(i) or termination of coverage or
12             employer  contributions  described  in  subparagraph
13             (c)(ii).
14             (2)  For dependent beneficiaries.
15                  (a)  In general.  If:
16                       (i)  a group health  plan  makes  coverage
17                  available  with  respect  to  a dependent of an
18                  individual,
19                       (ii)  the  individual  is  a   participant
20                  under  the  plan (or has met any waiting period
21                  applicable to becoming a participant under  the
22                  plan  and  is eligible to be enrolled under the
23                  plan but for  a  failure  to  enroll  during  a
24                  previous enrollment period), and
25                       (iii)  a  person  becomes such a dependent
26                  of the individual through marriage,  birth,  or
27                  adoption or placement for adoption,
28             then  the  group  health  plan  shall  provide for a
29             dependent special  enrollment  period  described  in
30             subparagraph (b) during which the person (or, if not
31             otherwise  enrolled, the individual) may be enrolled
32             under the plan as a dependent of the individual, and
33             in the case of the birth or adoption of a child, the
34             spouse of  the  individual  may  be  enrolled  as  a
HB0705 Enrolled            -20-                LRB9002464JScc
 1             dependent  of  the  individual  if  such  spouse  is
 2             otherwise eligible for coverage.
 3                  (b)  Dependent  special  enrollment  period.  A
 4             dependent  special  enrollment  period  under   this
 5             subparagraph  shall  be a period of not less than 30
 6             days and shall begin on the later of:
 7                       (i)  the date dependent coverage  is  made
 8                  available; or
 9                       (ii)  the  date of the marriage, birth, or
10                  adoption or placement for adoption (as the case
11                  may be) described in subparagraph (a)(iii).
12                  (c)  No waiting period.  If an individual seeks
13             to enroll a dependent during the first  30  days  of
14             such  a  dependent  special  enrollment  period, the
15             coverage of the dependent shall become effective:
16                       (i)  in the case of  marriage,  not  later
17                  than the first day of the first month beginning
18                  after   the  date  the  completed  request  for
19                  enrollment is received;
20                       (ii)  in the case of a dependent's  birth,
21                  as of the date of such birth; or
22                       (iii)  in   the   case  of  a  dependent's
23                  adoption or placement for adoption, the date of
24                  such adoption or placement for adoption.
25        (G)  Use of affiliation period by HMOs as alternative  to
26    preexisting condition exclusion.
27             (1)  In  general.  A health maintenance organization
28        which offers health insurance coverage in connection with
29        a group  health  plan  and  which  does  not  impose  any
30        pre-existing condition exclusion allowed under subsection
31        (A)  with  respect  to any particular coverage option may
32        impose an affiliation period for  such  coverage  option,
33        but only if:
34                  (a)  such  period  is applied uniformly without
HB0705 Enrolled            -21-                LRB9002464JScc
 1             regard to any health status-related factors; and
 2                  (b)  such period does not exceed 2 months (or 3
 3             months in the case of a late enrollee).
 4             (2)  Affiliation period.
 5                  (a)  Defined.  For purposes of  this  Act,  the
 6             term  "affiliation  period"  means  a  period which,
 7             under the terms of  the  health  insurance  coverage
 8             offered by the health maintenance organization, must
 9             expire  before the health insurance coverage becomes
10             effective.  The  organization  is  not  required  to
11             provide health care services or benefits during such
12             period  and  no  premium  shall  be  charged  to the
13             participant or beneficiary for any  coverage  during
14             the period.
15                  (b)  Beginning.  Such period shall begin on the
16             enrollment date.
17                  (c)  Runs  concurrently  with  waiting periods.
18             An  affiliation  period  under  a  plan  shall   run
19             concurrently with any waiting period under the plan.
20             (3)  Alternative   methods.   A  health  maintenance
21        organization  described  in   paragraph   (1)   may   use
22        alternative   methods,   from  those  described  in  such
23        paragraph, to address adverse selection  as  approved  by
24        the Department.
25    (Source: P.A. 90-30, eff. 7-1-97.)
26        Section  99.  Effective Date.  This Act takes effect upon
27    becoming law.

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