State of Illinois
90th General Assembly

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      New Act
      5 ILCS 375/6.9 new
      55 ILCS 5/5-1069.8 new
      65 ILCS 5/10-4-2.8 new
      215 ILCS 5/155.31 new
      215 ILCS 5/356t new
      215 ILCS 5/370s new
      215 ILCS 5/511.118 new
      215 ILCS 105/8.6 new
      215 ILCS 125/5-3.5 new
      215 ILCS 130/4002.5 new
      215 ILCS 110/48 new
      215 ILCS 165/15.25 new
      305 ILCS 5/5-16.8 new
          Creates the Managed Care Patient  Rights  Act.   Provides
      that  patients  who  receive health care under a managed care
      program have rights to certain coverage and service standards
      including, but not limited to, quality health  care  service,
      privacy  and confidentiality, freedom of choice of physician,
      explanation of bills, and protection from revocation of prior
      authorization.   Provides  for  the  Illinois  Department  of
      Public  Health  to  establish  standards  to  ensure  patient
      protection,  quality  of  care,  fairness  to physicians, and
      utilization review safeguards.  Requires managed  care  plans
      and   utilization   review  plans  to  be  certified  by  the
      Department of Public Health.  Amends various Acts to  require
      compliance  by  health  care  providers  under  the  Illinois
      Insurance  Code,  Comprehensive  Health  Insurance  Plan Act,
      Health Maintenance Organization Act, Limited  Health  Service
      Organization  Act, Voluntary Health Services Plans Act, State
      Employees  Group  Insurance  Act  of  1971,  Counties   Code,
      Illinois  Municipal  Code,  and  Illinois  Public  Aid  Code.
      Effective immediately.
 1        AN  ACT  to  create  the Managed Care Patient Rights Act,
 2    amending named Acts.
 3        Be it enacted by the People of  the  State  of  Illinois,
 4    represented in the General Assembly:
 6        Section  1-1.  Short title.  This Act may be cited as the
 7    Managed Care Patient Rights Act.
 8        Section  1-5.   Legislative  purpose.   The   legislature
 9    hereby finds and declares that:
10        (a)  Managed  care consists of systems or techniques that
11    are used to affect access to and control payments for  health
12    care services.  Managed care plans can be organized in a vast
13    number  of  structures,  including  licensed  and  unlicensed
14    components  that can restrict access to health care services.
15    As this  State's  health  care  market  becomes  increasingly
16    dominated by managed care  plans that utilize various managed
17    care techniques that include decisions regarding coverage and
18    the  appropriateness  of  health  care,  it  is a vital State
19    governmental function to protect patients and ensure fair and
20    equitable managed care practices.
21        (b)  Managed care plans, including  insurance  companies,
22    are  responsible  for  making  coverage decisions that have a
23    direct effect on the  health  of  patients.   Some  of  these
24    managed  care  plans  make  decisions  concerning the medical
25    necessity, appropriateness  of  alternative  treatments,  and
26    length  of  hospital stays. Further, these managed care plans
27    can restrict patients' ability to make  choices  about  their
28    health    care    providers.        Strong   provider-patient
29    relationships,  particularly  for  patients  with  acute   or
30    chronic  medical  conditions,  enhances the curative process.
                            -2-               LRB9001044JSgcB
 1    Maintaining continuity of care as patients  change  providers
 2    and health plans is essential to the health and well-being of
 3    the  patients  enrolled  in the managed care plans.  It is in
 4    the interest of the health  of  the  public  to  insure  that
 5    decisions about the availability of health care providers and
 6    the willingness of payors to pay for medically necessary care
 7    are made in an appropriate manner.
 8        (c)  This   legislation   establishes   a   managed  care
 9    patient's right to, at a minimum, all of the following:
10             (1)  Quality health care services.
11             (2)  Identification  of  his  or  her  participating
12        providers.
13             (3)  Reasonable explanation of the patient's plan of
14        care.
15             (4)  A reasonable explanation of  bills  for  health
16        care services.
17             (5)  Clear  and  understandable  explanation  of the
18        terms and conditions of coverage.
19             (6)  Timely  notification  of  individual   coverage
20        termination.
21             (7)  Privacy  and  confidentiality  in  health  care
22        services.
23             (8)  Freedom   to  purchase  necessary  health  care
24        services.
25             (9)  Freedom of choice of  physician  to  coordinate
26        health  care,  including  a  prohibition  of  retaliation
27        against   physicians  who  advocate  medically  necessary
28        health care for their patients.
29             (10)  Protection   from    revocation    of    prior
30        authorization.
31             (11)  Prohibition   of   prior   authorization   for
32        emergency care.
33             (12)  Timely  and  clear  notification  of  provider
34        termination.
                            -3-               LRB9001044JSgcB
 1    These  rights  shall be implemented through the regulation of
 2    managed care plans and utilization review programs.
 3        (d)  The Department  of  Public  Health  is  required  to
 4    establish   standards   for   the  certification  of  certain
 5    functions common  to  licensed  insurance  companies,  health
 6    maintenance  organizations, self-insured employer or employee
 7    organizations, and other managed care plans.  These functions
 8    shall  be  certified  as  qualified  managed  care  plans  or
 9    qualified  utilization  review   programs.    Standards   are
10    required  to  ensure  patient  protection,  quality  of care,
11    fairness  to  physician  and  other  health  care  providers,
12    utilization review safeguards, and coverage options  for  all
13    patients,  including  the  ability  to  enroll  in a point of
14    service plan.
15        Section 1-10.  Definitions.  As used in this Act:
16        "Board" means the State Board of Health.
17        "Department" means the Department of Public Health.
18        "Director" means the Director of Public Health.
19        "Enrollee" means an individual and his or her  dependents
20    who are enrolled in a managed care plan.
21        "Health   care  provider"  means  a  physician,  dentist,
22    podiatrist, registered professional nurse, clinic,  hospital,
23    federally  qualified  health  center,  rural  health  clinic,
24    ambulatory  surgical  treatment center, pharmacy, laboratory,
25    physician  organization,  preferred  provider   organization,
26    independent  practice  association,  or  other  appropriately
27    licensed provider of health care services.
28        "Health  care  services"  means  services,  supplies,  or
29    products  rendered  or  sold by a health care provider within
30    the scope of the provider's license.  The term includes,  but
31    is  not  limited  to,  hospital,  medical,  surgical, dental,
32    podiatric, pharmacy, vision, home health, and  pharmaceutical
33    products.
                            -4-               LRB9001044JSgcB
 1        "Managed  care  plan"    means  a  plan that establishes,
 2    operates, or maintains a network  of  health  care  providers
 3    that  have  entered  into agreements with the plan to provide
 4    health care services to enrollees  where  the  plan  has  the
 5    ultimate and direct contractual obligation to the enrollee to
 6    arrange  for the provision of or pay for health care services
 7    through:
 8                  (1)  organizational  arrangements  for  ongoing
 9             quality assurance, utilization review  programs,  or
10             dispute resolution; or
11                  (2)  financial  incentives for persons enrolled
12             in the plan to use the participating  providers  and
13             procedures covered by the plan.
14             A  managed  care plan may be established or operated
15        by any entity including  a  licensed  insurance  company,
16        hospital  or  medical  service  plan,  health maintenance
17        organization,  limited   health   service   organization,
18        preferred     provider    organization,    third    party
19        administrator, or an employer or employee organization.
20        "Participating provider" means  a  health  care  provider
21    that  has  entered into an agreement with a managed care plan
22    to provide health care services to a patient enrolled in  the
23    managed care plan.
24        "Patient"  means  any  person  who  has  received  or  is
25    receiving health care services from a health care provider.
26        "Primary  care"  means  the provision of a broad range of
27    personal  medical  care  (preventive,  diagnostic,  curative,
28    counseling,  or  rehabilitative)  in   a   manner   that   is
29    accessible,  comprehensive,  and  coordinated  over time by a
30    physician licensed to practice medicine in all its branches.
31        "Principal  care"  means   the   provision   of   ongoing
32    preventive,     diagnostic,    curative,    counseling,    or
33    rehabilitative care, provided or coordinated by  a  physician
34    licensed  to  practice  medicine in all its branches, that is
                            -5-               LRB9001044JSgcB
 1    focused on a specific organ system,  disease,  or  condition.
 2    Principal  care  may  be  provided concurrently with or apart
 3    from primary care.
 4        "Qualified managed care plan" means a managed  care  plan
 5    that  the  Director certifies upon application by the plan as
 6    meeting the requirements of this Act.
 7        "Qualified   utilization   review   program"   means    a
 8    utilization  review  program that the Director certifies upon
 9    application by the program as  meeting  the  requirements  of
10    this Act.
11        "Utilization  review  program" means a system operated by
12    or on behalf of a  managed  care  plan  for  the  purpose  of
13    reviewing  the medical necessity, appropriateness, or quality
14    of health care services and supplies provided or proposed  to
15    be   provided  by  the  managed  care  plan  using  specified
16    guidelines.   The   system    may    include    pre-admission
17    certification,  the  application  of  appropriately developed
18    clinically-based guidelines, length of stay review, discharge
19    planning,  preauthorization  of  ambulatory  procedures,  and
20    retrospective review.
22        Section 5-5.  Managed care patient rights.
23        (a)  A patient has the  right  to  care  consistent  with
24    professional  standards of practice to assure quality nursing
25    and medical practices, to be informed  of  the  name  of  the
26    participating  physician  responsible for coordinating his or
27    her care,  to  receive  information  concerning  his  or  her
28    condition  and proposed treatment, to refuse any treatment to
29    the  extent  permitted   by   law,   and   to   privacy   and
30    confidentiality  of  records  except as otherwise provided by
31    law.
32        (b)  A patient has the right,  regardless  of  source  of
                            -6-               LRB9001044JSgcB
 1    payment,  to  examine and to receive a reasonable explanation
 2    of his or her total bill for health care services rendered by
 3    his or her physician or other health care provider, including
 4    the  itemized  charges  for  specific  health  care  services
 5    received.  A physician or other health care provider shall be
 6    responsible  only  for  a  reasonable  explanation  of  these
 7    specific health care services provided  by  the  health  care
 8    provider.
 9        (c)  A  patient  has  the right to timely prior notice of
10    the termination in the event a managed care plan  cancels  or
11    refuses to renew an individual's participation in the  plan.
12        (d)  A   patient   has   the   right   to   privacy   and
13    confidentiality  in  health  care.  A physician, other health
14    care provider, managed  care  plan,  and  utilization  review
15    program  shall  refrain from disclosing the nature or details
16    of health care services provided to patients, except that the
17    information may be disclosed to the patient, the party making
18    treatment decisions if the patient  is  incapable  of  making
19    decisions  regarding the health care services provided, those
20    parties directly involved with  providing  treatment  to  the
21    patient  or  processing the payment for the treatment only in
22    accordance with Section 5-40, those parties  responsible  for
23    peer  review,  utilization review, and quality assurance, and
24    those parties required to be notified under  the  Abused  and
25    Neglected   Child   Reporting   Act,  the  Illinois  Sexually
26    Transmissible  Disease  Control  Act,  or   where   otherwise
27    authorized  or  required by law.  This right may be expressly
28    waived in writing by the patient or the  patient's  guardian,
29    but  a  managed  care plan, a physician, or other health care
30    provider may not  condition  the  provision  of  health  care
31    services  on  the  patient's  or guardian's agreement to sign
32    such a waiver.
33        (e)  An individual has the right to purchase  any  health
34    care  services  with that individual's own funds, whether the
                            -7-               LRB9001044JSgcB
 1    health care services  are  covered  within  the  individual's
 2    basic  benefit  package  or  from any health care provider or
 3    plan received as a benefit  of  employment  or  from  another
 4    source.   Employers  shall  not  be prohibited from providing
 5    coverage for benefits in addition those mandated by law.
 6        Section  5-10.    Medically   appropriate   health   care
 7    protection.
 8        (a)  No  managed  care  plan  shall  retaliate  against a
 9    physician or other health care  provider  who  advocates  for
10    appropriate health care for their patients.
11        (b)  It  is  the  public  policy of the State of Illinois
12    that a  physician  or  any  other  health  care  provider  be
13    encouraged  to advocate for medically appropriate health care
14    for his or her patients.  For purposes of this  Section,  "to
15    advocate  for  medically  appropriate  health  care" means to
16    appeal a payor's decision  to  deny  payment  for  a  service
17    pursuant  to  the  reasonable  grievance  or appeal procedure
18    established by a managed care plan or third-party  payor,  or
19    to protest a decision, policy, or practice that the physician
20    or  another health care provider, consistent with that degree
21    of learning and skill ordinarily possessed by  physicians  or
22    other  health  care  providers  practicing  in  the same or a
23    similar locality and under similar circumstances,  reasonably
24    believes   impairs  the  physician's  or  other  health  care
25    provider's ability to provide appropriate health care to  his
26    or her patients.
27        (c)  The  application  and  rendering  by any person of a
28    decision to terminate  an  employment  or  other  contractual
29    relationship  with or otherwise penalize a physician or other
30    health care provider  for advocating for  appropriate  health
31    care  consistent  with  the  degree  of  learning  and  skill
32    ordinarily  possessed  by  physicians  or  other  health care
33    providers practicing in the same or a  similar  locality  and
                            -8-               LRB9001044JSgcB
 1    under  similar  circumstances  violates  the public policy of
 2    this State and constitutes a business offense subject to  the
 3    penalty under Section 20-15.
 4        (d)  This  Section  shall  not be construed to prohibit a
 5    payor from making a determination not to pay for a particular
 6    health  care  service  or  to  prohibit  a   medical   group,
 7    independent    practice   association,   preferred   provider
 8    organization, foundation, hospital  medical  staff,  hospital
 9    governing  body,  or  payor  from  enforcing  reasonable peer
10    review or utilization review protocols or determining whether
11    a physician or other health care provider has  complied  with
12    those protocols.
13        (e)  Nothing  in  this  Section  shall  be  construed  to
14    prohibit  the  governing  body  of a hospital or the hospital
15    medical staff  from  taking  disciplinary  action  against  a
16    physician as authorized by law.
17        (f)  Nothing  in  this  Section  shall  be  construed  to
18    prohibit  the  Department  of  Professional  Regulation  from
19    taking  disciplinary  action  against  a  physician  or other
20    health care provider under the appropriate licensing Act.
21        Section 5-20.  Choice of physician.
22        (a)  All managed care plans that require each enrollee to
23    select a participating provider  for  any  purpose  including
24    coordination  of care shall allow all enrollees to choose any
25    primary care physician licensed to practice medicine  in  all
26    its  branches participating in the managed care plan for that
27    purpose.
28        (b)  In  addition,  all  enrollees   with   an   ongoing,
29    recurring,  or  chronic disease or condition shall be allowed
30    to choose any participating physician  licensed  to  practice
31    medicine  in  all  its  branches  to  provide principal care,
32    without referral from the provider  coordinating  care.   The
33    decision regarding selection of any physician for any purpose
                            -9-               LRB9001044JSgcB
 1    must be made by the enrollee and the physician.   The managed
 2    care  plan's Medical Review Board shall define those diseases
 3    and conditions that shall be considered  ongoing,  recurring,
 4    or chronic diseases and conditions for the managed care plan.
 5        (c)  The  enrollee  may  be  required by the managed care
 6    plan to select a principal care physician who has a  referral
 7    arrangement  with the enrollee's primary care physician or to
 8    select a new  primary  care  physician  who  has  a  referral
 9    arrangement  with  the principal care physician chosen by the
10    enrollee.  If a managed care plan  requires  an  enrollee  to
11    select a new physician under this subsection (c), the managed
12    care  plan  must  provide  the  enrollee  with  both  options
13    provided in this subsection (c).
14        (d)  Nothing  shall  prohibit  the managed care plan from
15    requiring prior  authorization  or  approval  from  either  a
16    primary  care  physician  or  a  principal care physician for
17    referrals for additional health care services.  Nothing shall
18    prohibit the managed care plan from requiring  the  principal
19    care  physician to coordinate referrals for additional health
20    care services with the primary care physician.
21        Section 5-25.  Prohibited  restraints  on  communication.
22    No  managed  care plan may prohibit or discourage health care
23    providers  from  discussing  any  alternative   health   care
24    services   and  providers,  utilization  review  and  quality
25    assurance policies, terms and conditions of  plans  and  plan
26    policies with enrollees, prospective enrollees, providers, or
27    the  public.   Any violation of this Section shall be subject
28    to the penalties set forth in Sections 20-15 and 20-55.
29        Section 5-30.  Procedure authorization.  A  managed  care
30    plan  that  authorizes  a  specific  type  of  treatment by a
31    provider shall  not rescind or modify the authorization after
32    the provider renders the health care service  in  good  faith
                            -10-              LRB9001044JSgcB
 1    and pursuant to the authorization.  This Section shall not be
 2    construed  to  expand  or alter the benefits available to the
 3    enrollee under a managed care plan.
 4        Section 5-40.  Patient confidential records.   A  managed
 5    care plan shall not release any information to an employer or
 6    anyone  else,  except as specifically authorized by law, that
 7    would directly or indirectly  indicate  to  the  employer  or
 8    anyone  else  that  an  enrollee is receiving or has received
 9    health care services from a health care provider  covered  by
10    the  managed  care plan, unless expressly authorized to do so
11    in writing by the enrollee.
12        Section 5-45.  Emergency care.  All  managed  care  plans
13    shall  provide  care  for an emergency, as defined in Section
14    3.5 of the Emergency Medical Services (EMS) Systems Act, such
15    that payment for this coverage is not dependent upon  whether
16    or   not   the  health  care  services  are  performed  by  a
17    participating  provider.  The  managed  care  plan  shall  be
18    notified, after the patient is stabilized, of any nonemergent
19    health care services needed by the patient.  The managed care
20    plan must respond to the request for  authorization  for  any
21    needed   health   care   services   within   30   minutes  of
22    notification.  In the absence of a response, the health  care
23    services shall be deemed approved.
24        Section 5-50.  Notices of payment or denial.  All managed
25    care  plans  shall provide enrollees with detailed notices of
26    payment and denial.  The notices of denial shall be signed by
27    the individual responsible for denying payment and include an
28    address  and  accessible  phone  number  of  the   individual
29    responsible  for  denying  payment.   Further,  the notice of
30    denial shall clearly state the procedures for  appealing  the
31    denial.   The  enrollee  shall  be  given  the opportunity to
                            -11-              LRB9001044JSgcB
 1    respond to any denial and explain any discrepancies.
 2        Section  5-55.  Prohibition  of  waiver  of  rights.   No
 3    managed care plan or contract  shall  contain  any  provision
 4    which limits, restricts or waives any of the rights set forth
 5    in this Act.
 7                           REVIEW PROGRAMS
 8        Section  10-5.   Certification  of managed care plans and
 9    utilization review programs.
10        (a)  Certification.   All   managed   care   plans   with
11    enrollees   in   Illinois  and  utilization  review  programs
12    reviewing health care services provided in Illinois  must  be
13    certified   by  the  Department  in  addition  to  any  other
14    licensure  required  by  law  in  order  to  do  business  in
15    Illinois.    The  Director  shall  establish  a  process  for
16    certification of managed care plans and of utilization review
17    programs.  Certification  of  managed  care  plans  shall  be
18    supplemental to the existing regulation of managed care plans
19    by   the   Department   of   Insurance.   The   certification
20    requirements of Sections 10-15, 10-20, 10-25,  10-30,  10-35,
21    10-40,  10-45,  and  10-60  shall  be  incorporated  into the
22    licensure   requirements   under   the   Health   Maintenance
23    Organization  Act  and  the  program  requirements   of   the
24    Department  of  Public  Aid  and  the   Department  of  Human
25    Services, and no further certification under this Article  is
26    required.   With respect to all other managed care plans, the
27    Department   of   Insurance  shall  transmit  copies  of  any
28    application for issuance of a certificate of authority to the
29    Director of the Department of Public Health.  The Director of
30    the Department of Public Health shall then determine  whether
31    the  applicant for the certificate of authority, with respect
                            -12-              LRB9001044JSgcB
 1    to  the  delivery  of  health   care   services:   (1)    has
 2    demonstrated  the willingness and potential ability to assure
 3    that such health care services will be provided in  a  manner
 4    to insure both availability, accessibility, and continuity of
 5    health  care  services with adequate personnel and facilities
 6    and (2) has  arrangements,  established  in  accordance  with
 7    regulations  adopted  by the Department of Public Health, for
 8    continuing compliance with the requirements of the Act.  Upon
 9    investigation,  the  Director  of  the  Department  of Public
10    Health shall certify to the Director  of  the  Department  of
11    Insurance   whether   the   proposed  managed  care  plan  or
12    utilization review program meets  the  requirements  of  this
13    Act.   If  the  Director  of  the Department of Public Health
14    certifies that the managed care plan  or  utilization  review
15    program  does  not meet the requirements, he shall specify in
16    writing the deficiencies. The Director of the  Department  of
17    Insurance  shall not issue a certificate of authority, unless
18    the Director of the Department  of  Public  Health  certifies
19    that  the managed care plan's or utilization review program's
20    proposed plan of operation meets  the  requirements  of  this
21    Act.
22        (b)  Review  and  recertification.   The  Director  shall
23    establish    procedures   for   the   periodic   review   and
24    recertification of qualified managed care plans and qualified
25    utilization review programs.
26        (c)  Termination of certification.   The  Director  shall
27    terminate the certification of a previously qualified managed
28    care  plan  or  a qualified utilization review program if the
29    Director determines that the plan or program no longer  meets
30    the   applicable   requirements  for  certification.   Before
31    effecting a termination, the Director shall provide the  plan
32    or  program  notice  and  opportunity  for  a  hearing on the
33    proposed  termination  in  accordance  with  Sections  20-35,
34    20-40, and 20-45 of this Act.
                            -13-              LRB9001044JSgcB
 1        (d)  Recognition of accreditation.  If the Director finds
 2    that a national accreditation body establishes a  requirement
 3    or  requirements  for accreditation of a managed care plan or
 4    utilization review program that are at least equivalent to  a
 5    requirement  established  under Article 10, the Director may,
 6    to the extent appropriate, treat a managed  care  plan  or  a
 7    utilization  review  program  thus  accredited as meeting the
 8    requirements of Article  10.  The  requirements  of  Sections
 9    10-25,  10-30,  10-35, and 10-60(b)(3) and (6), however, must
10    be adhered to by all certified entities.
11        Section 10-10.   Managed  care  plan.   Requirements  for
12    certification. The Director shall establish standards for the
13    certification  of  qualified  managed care plans that conduct
14    business in this State,  including  standards  set  forth  in
15    Sections 10-15 through 10-50.
16        Section 10-15.  Managed care plan information.
17        (a)  Prospective  enrollees in managed care plans must be
18    provided  written  information  disclosing  the   terms   and
19    conditions  of  the  managed care plans so that they can make
20    informed decisions about accepting a certain system of health
21    care delivery.  Where the  managed  care  plan  is  described
22    orally to prospective enrollees, the oral description must be
23    easily understood, truthful, and objective in the terms used.
24        (b)  All  managed care plans must be described in writing
25    in a  legible  and  understandable  format,  consistent  with
26    standards developed for supplemental insurance coverage under
27    Title  XVIII  of the Social Security Act. This format must be
28    standardized so that prospective enrollees  can  compare  the
29    attributes  of  the  managed  care plans. Specific items that
30    must be included are:
31             (1)  coverage   provisions,   benefits,   and    any
32        exclusions  or  limitations of: (i)  health care services
                            -14-              LRB9001044JSgcB
 1        or (ii) physicians or other providers;
 2             (2)  any and all prior authorization or other review
 3        requirements    including    preauthorization     review,
 4        concurrent   review,  post-service  review,  post-payment
 5        review, and any procedures that may lead the  patient  to
 6        be  denied  coverage  for or not be provided a particular
 7        health care service;
 8             (3)  a detailed explanation of the managed care plan
 9        policy  describing  how  the  managed  care  plan   shall
10        facilitate the continuity of care for enrollees receiving
11        health care services from non-participating providers;
12             (4)  a detailed explanation of how managed care plan
13        limitations  affect  enrollees,  including information on
14        enrollee  financial   responsibility   for   payment   of
15        co-payments, deductibles, coinsurance, and non-covered or
16        out-of-plan health care services;
17             (5)  a   detailed  explanation  of  the  percent  of
18        premium going to pay for  care  and  percent  of  premium
19        going to pay for administration;
20             (6)  educational  materials  explaining  the  proper
21        utilization of emergency  care in accordance with Section
22        5-45 prepared by the Department of Public Health;
23             (7)  enrollee  satisfaction  statistics,  including,
24        but  not  limited  to,    reenrollment,  and  reasons for
25        leaving a managed care plan; and
26             (8)  explanation  of  how  the  managed  care   plan
27        compensates   health   care   providers   and  how  those
28        compensation arrangements may  impact  the  provision  of
29        health care services.
30        Section 10-20.  Access to providers.   Managed care plans
31    must demonstrate that they have adequate access to physicians
32    in  appropriate  medical  specialties  and  other health care
33    providers, so that all covered health care services  will  be
                            -15-              LRB9001044JSgcB
 1    provided  in  a  timely  fashion.  This requirement cannot be
 2    waived and must be met in  all  geographic  areas  where  the
 3    managed care plan has enrollees, including rural areas.
 4        Section  10-25.   Fairness  in  contracting.  All managed
 5    care  plans  must  provide  that  any  individual   physician
 6    licensed  to  practice  medicine  in  all  its  branches, any
 7    pharmacy, any federally qualified health center, any dentist,
 8    and any podiatrist, that consistently  meets  the  reasonable
 9    terms  and  conditions  established  by  a  managed care plan
10    including,  but  not  limited  to,  credentialing  standards,
11    adherence  to   quality   assurance   program   requirements,
12    utilization  management  guidelines, contract procedures, and
13    provider network size and accessibility requirements must  be
14    accepted  by  the  managed  care  plan.  Any physician or any
15    other health care provider who is either terminated  from  or
16    denied  inclusion in the medical staff or provider network of
17    the managed care plan shall be given, within 10 business days
18    after  that  determination,  a  written  explanation  of  the
19    reasons for his or her  exclusion  or  termination  from  the
20    medical  staff  or  provider  network  and  an opportunity to
21    appeal.
22        Section 10-30.  Managed care plan medical staff.
23        (a)  Within 12 months after the effective  date  of  this
24    Act, all managed care plans shall be required to establish an
25    independent  medical  staff  comprised  of  all participating
26    physicians licensed to practice medicine in all its branches.
27    The  medical  staff  must  be  organized  and   operated   in
28    accordance  with  written rules and regulations.  These rules
29    and regulations must be written and approved by  the  medical
30    staff  and  the  managed care plan's governing body.  Neither
31    the medical staff nor the managed care plan's governing  body
32    may  unilaterally  amend  the  rules  and  regulations.   The
                            -16-              LRB9001044JSgcB
 1    medical  staff  must  elect from its members a Medical Review
 2    Board representative by medical specialty and geographic area
 3    of the medical staff.  The  Medical  Review  Board  shall  be
 4    established  in  the  medical staff rules and regulations and
 5    shall be comprised of a minimum of 25 physicians with no more
 6    than 20%  of  the  physicians  being  from  any  one  medical
 7    specialty.   The  managed  care  plans must grant the Medical
 8    Review  Board   defined   rights   under   which   physicians
 9    participating  in  the managed care plan collaborate with the
10    managed care plan to  establish  the  plan's  medical  policy
11    (including, but not limited to,  delivery of any covered: (i)
12    health  care services, (ii) pharmaceuticals, (iii) procedures
13    and  (iv)  technology),  utilization  review   criteria   and
14    procedures,   quality   assurance  procedures,  credentialing
15    criteria, and medical management  procedures.    The  Medical
16    Review   Board   may  make  recommendations,  but  shall  not
17    determine the managed  care  plan's  covered  services.   The
18    medical  staff  and Medical Review Board must report directly
19    to the managed care plan's governing body.
20        (b)  The  medical  staff  rules  and  regulations   shall
21    provide  due  process  procedures  for  all actions granting,
22    reducing, restricting, suspending, revoking, denying, or  not
23    renewing   medical  staff  membership  and  privileges.   The
24    managed  care  plan's  governing  body  shall   not   control
25    evaluation  of  credentials  of  applicants for medical staff
26    membership and privileges or  the  exercise  of  professional
27    judgment.   The managed care plan's governing body shall make
28    all final medical staff membership and  privilege  decisions.
29    The  Department  shall develop standardized application forms
30    for credentialing. This information shall be verified by  the
31    managed care plans from primary sources.
32        Section 10-35.  Credentialing.
33        (a)  A  managed  care  plan  shall  allow  all physicians
                            -17-              LRB9001044JSgcB
 1    within the managed care plan's  geographic  service  area  to
 2    apply  for  medical  staff membership and clinical privileges
 3    under established medical staff rules and  regulations.   All
 4    physicians   within   the   managed   care   plan   shall  be
 5    recredentialed no more often than once every 2 years.
 6             (1)  In accordance with the criteria in  this  item,
 7        items  (2)  and  (3),  and  subsection (b), credentialing
 8        shall be performed in a  timely  manner  by  the  medical
 9        staff  directly  or  through  a contract with a physician
10        organization  approved  by  the  medical  staff.      The
11        credentialing  process  shall  be  completed  in a timely
12        manner  not  to  exceed  6  months.   For   purposes   of
13        credentialing:    "Adverse  decision"  means  a  decision
14        reducing, restricting, suspending, revoking, denying,  or
15        not  renewing medical staff membership including, but not
16        limited  to,  limitations  on  access  to   institutional
17        equipment,  facilities  and personnel.  "Economic factor"
18        means any information or reasons for decisions  unrelated
19        to quality of care or professional competency.
20                  (A)  The credentialing process shall begin upon
21             application  of a physician to the managed care plan
22             for inclusion.
23                  (B)  An application  shall  be  reviewed  by  a
24             credentialing  committee  with representation of the
25             applicant's medical specialty.
26                  (C)  Credentialing shall be based on  objective
27             standards  of  quality  with  input  from physicians
28             credentialed in  the  managed  care  plan,  and  the
29             standards  shall  be  available  to  applicants  and
30             medical  staff  members. Any profiling of physicians
31             must be adjusted to recognize case mix, severity  of
32             illness,  age  of  patients, and other features of a
33             physician's practice including all economic  factors
34             that  may  account  for  higher  than  or lower than
                            -18-              LRB9001044JSgcB
 1             expected costs.  Profiles must be made available  to
 2             those  so profiled.  When graduate medical education
 3             is   a   consideration   in   credentialing,   equal
 4             recognition shall  be  given  to  training  programs
 5             accredited  by  the  Accrediting Council on Graduate
 6             Medical Education or  by  the  American  Osteopathic
 7             Association.   The  lack of  board certification may
 8             not be the single or exclusive criteria  for  denial
 9             of participation.
10                  (D)  A  managed  care  plan  is prohibited from
11             excluding health care providers solely because those
12             health care providers treat a substantial number  of
13             patients   with  conditions  or illnesses  which may
14             require costly care or treatment.
15                  (E)  The medical staff shall make credentialing
16             recommendations to the managed care plan's governing
17             body.  All governing  body  credentialing  decisions
18             shall be made on the record, and the applicant shall
19             be provided with all reasons used if the application
20             is denied or the credentials not renewed.
21                  (F)  Prior   to   initiation  of  a  proceeding
22             leading to termination of a contract, the  physician
23             shall   be   provided  notice,  an  opportunity  for
24             discussion, and an opportunity  to  enter  into  and
25             complete  a  corrective action plan, except in cases
26             where there is imminent harm to patient health or  a
27             license  probation, suspension, or revocation action
28             by the Department of Professional Regulation.
29             (2)  Minimum procedures for initial  applicants  for
30        medical staff membership and privileges shall include the
31        following:
32                  (A)  Written   procedures   relating   to   the
33             acceptance  and processing of initial applicants for
34             medical staff membership.
                            -19-              LRB9001044JSgcB
 1                  (B)  Written  procedures  to  be  followed   in
 2             determining  an applicant's qualifications for being
 3             granted medical staff membership and privileges.
 4                  (C)  Written  criteria  to   be   followed   in
 5             evaluating an applicant's qualifications.
 6                  (D)  An  evaluation  of  an applicant's current
 7             health  status  and  current   license   status   in
 8             Illinois.
 9                  (E)  A  written response to each applicant that
10             explains the  reason  or  reasons  for  any  adverse
11             decision, including all reasons based in whole or in
12             part  on  the  applicant's medical qualifications or
13             any other basis, including economic factors.
14             (3)  Minimum  procedures  with  respect  to  medical
15        staff membership and privilege determinations  concerning
16        current  members  of  the medical staff shall include the
17        following:
18                  (A)  A written notice of an adverse decision by
19             the governing body of the managed care plan.
20                  (B)  An  explanation  of  the  reasons  for  an
21             adverse decision including all reasons based on  the
22             quality   of   medical  care  or  any  other  basis,
23             including economic factors.
24                  (C)  A statement of the medical staff  member's
25             right  to  request  a  fair  hearing  on the adverse
26             decision before a hearing panel whose membership  is
27             mutually  agreed  upon  by the medical staff and the
28             governing  body  of  the  managed  care  plan.   The
29             hearing panel shall have  independent  authority  to
30             recommend  action  to  the  governing  body  of  the
31             managed  care plan.  Upon the request of the medical
32             staff member or the governing body  of  the  managed
33             care  plan,  the  hearing  panel shall make findings
34             concerning the nature of each basis for any  adverse
                            -20-              LRB9001044JSgcB
 1             decision   recommended   to   and  accepted  by  the
 2             governing body of the managed care plan.  Nothing in
 3             this item  (C)  limits  a  managed  care  plan's  or
 4             medical  staff's right to summarily suspend, without
 5             a prior hearing, a person's medical staff membership
 6             or privileges if the continuation of practice  of  a
 7             medical staff member constitutes an immediate danger
 8             to  the  public.   A fair hearing shall be commenced
 9             within 15 days after the  suspension  and  completed
10             without  delay.   Nothing  in this item (C) limits a
11             medical staff's right  to  permit,  in  the  medical
12             staff  rules  and regulations, summary suspension of
13             membership    or    privileges     in     designated
14             administrative    circumstances    as   specifically
15             approved by the medical staff.  This provision  must
16             specifically   describe   both   the  administrative
17             circumstances  that  can   result   in   a   summary
18             suspension and the length of the summary suspension.
19             The  opportunity  for a fair hearing is required for
20             any   administrative   summary   suspension.     Any
21             requested  hearing  must be commenced within 15 days
22             after the summary suspension and  completed  without
23             delay.   Adverse  decisions other than suspension or
24             other restrictions on the treatment or admission  of
25             patients  may  be  imposed  summarily  and without a
26             hearing     under     designated      administrative
27             circumstances  as  specifically  provided for in the
28             medical staff rules and regulations as  approved  by
29             the medical staff.
30                  (D)  A  statement  of  the  member's  right  to
31             inspect  all  pertinent  information  in the managed
32             care plan's possession with respect to the decision.
33                  (E)  A  statement  of  the  member's  right  to
34             present witnesses and other evidence at the  hearing
                            -21-              LRB9001044JSgcB
 1             on the decision.
 2                  (F)  A  written  notice and written explanation
 3             of the decision resulting from the hearing.
 4                  (G)  Notice  shall  be  given  15  days  before
 5             implementation   of   an   adverse   medical   staff
 6             membership    or    privileges    decision     based
 7             substantially  on  economic  factors.   This  notice
 8             shall  be  given  after  the  medical  staff  member
 9             exhausts   all   applicable  procedures  under  this
10             Section, including item (C) of this  item  (3),  and
11             under  the  medical  staff  rules and regulations in
12             order to  allow  sufficient  time  for  the  orderly
13             provision of patient care.
14                  (H)  Nothing  in this item (3) limits a medical
15             staff member's  right  to  waive,  in  writing,  the
16             rights  provided  in  items  (A) through (H) of this
17             item (3) upon being granted  the  written  exclusive
18             right to provide particular health care services for
19             a  managed  care  plan,  either individually or as a
20             member of a group.
21        (b)  Every   adverse   medical   staff   membership   and
22    privileges decision based substantially on  economic  factors
23    shall  be  reported by the managed care plan's governing body
24    to the Board of Health  before  the  decision  takes  effect.
25    These reports shall not be disclosed in any form that reveals
26    the  identity  of  any  physician.   These  reports  shall be
27    utilized to study the effects that medical  staff  membership
28    decisions  based upon economic factors have on access to care
29    and the availability of physician services.  The Board  shall
30    submit  an  initial  study  to  the  Governor and the General
31    Assembly by July 1, 1998, and  subsequent  reports  shall  be
32    submitted periodically thereafter.
33        (c)  All  other participating providers shall be provided
34    a due process appeal from all adverse participation decisions
                            -22-              LRB9001044JSgcB
 1    by the managed care plan's  governing  body.   The  providers
 2    shall  be provided notice, an opportunity for discussion, and
 3    an opportunity to enter into and complete a corrective action
 4    plan, except in cases where there is imminent harm to patient
 5    health or license probation, suspension or revocation  action
 6    by the applicable licensing agency.
 7        Section    10-40.    Records.     Procedures   shall   be
 8    established to ensure that all applicable federal  and  State
 9    laws  designed  to protect the confidentiality of health care
10    provider records and individual medical records are followed.
11    These records shall be afforded the  protections  of  Section
12    8-2101  through 8-2105 of the Code of Civil Procedure and may
13    not be disclosed to any court, tribunal or  board  except  in
14    accordance with this provision.
15        Section 10-45.  Provider termination.
16        (a)  The  Director  shall  adopt rules requiring that all
17    participating   provider   agreements   contain    provisions
18    concerning  timely and reasonable notices to be given between
19    the parties and for the managed care plan to  provide  timely
20    and   reasonable  notice  to  its  enrollees.   In  order  to
21    facilitate  transfer  of  health  care  services,  reasonable
22    advance notice of provider termination shall be given to  the
23    provider  and  enrollees.   Notice  shall be given for events
24    including, but   not  limited  to,  termination  of  provider
25    agreements or managed care plan services.  Notice of provider
26    termination  to  enrollees shall be in a form approved by the
27    Director.
28        (b)  When a managed care plan terminates a contract  with
29    an  entire  medical  group,  physician organization, or other
30    health care provider  organization,  the  managed  care  plan
31    shall  notify enrollees who have selected that medical group,
32    physician  organization,  or  other  health   care   provider
                            -23-              LRB9001044JSgcB
 1    organization of the termination.
 2        (c)  When  a  managed  care plan terminates a contractual
 3    arrangement with an individual health care provider within  a
 4    medical  group,  physician organization, or other health care
 5    provider organization, the managed care plan may request that
 6    medical group, physician organization, or other  health  care
 7    provider   organization  to  notify  the  enrollees  who  are
 8    patients of that health care provider of the termination.
 9        (d)  Whenever  a  managed  care  plan  indicates  that  a
10    provider's contract is being terminated for  any  reason,  it
11    shall provide a detailed written statement to the health care
12    provider of the reasons for termination.
13        Section 10-50.  Complaint handling procedure.
14        (a)  Every  managed  care  plan  and  utilization  review
15    program  shall  establish  and  maintain  a  complaint system
16    providing  reasonable  procedures  for  resolving  complaints
17    initiated   by   enrollees   or   health    care    providers
18    (complainant).  Nothing herein shall be construed to preclude
19    an enrollee or a health care provider from filing a complaint
20    with  the  Director  or as limiting the Director's ability to
21    investigate complaints.
22        (b)  When a  complaint  is  received  by  the  Department
23    against  a  managed  care  plan (respondent),  the respondent
24    shall be notified of the complaint.  The Department shall, in
25    its notification, specify the date when a  report  is  to  be
26    received from the respondent, which shall be no later than 21
27    days after notification is sent to the respondent.  A failure
28    to  reply  by the date specified may be followed by a collect
29    telephone call or collect telegram.   Repeated  instances  of
30    failing  to reply by the date specified may result in further
31    regulatory action.
32        (c)  Contents of response or report.
33             (1)  The   respondent    shall    supply    adequate
                            -24-              LRB9001044JSgcB
 1        documentation  which  explains  all  actions taken or not
 2        taken and which were the basis for the complaint.
 3             (2)  Documents necessary to support the respondent's
 4        position and information  requested  by  the  Department,
 5        shall be furnished with the respondent's reply.
 6             (3)  The  respondent's  reply shall be in duplicate,
 7        but duplicate copies of supporting documents shall not be
 8        required.
 9             (4)  The respondent's reply shall include the  name,
10        telephone  number, and address of the individual assigned
11        to the complaint.
12             (5)  The    Department     shall     respect     the
13        confidentiality  of  medical  reports and other documents
14        which by law are  confidential.   Any  other  information
15        furnished  by a respondent shall be marked "confidential"
16        if the respondent does not wish it to be released to  the
17        complainant.
18        (d)  Follow-up   conclusion.    Upon   receipt   of   the
19    respondent's   report,  the  Department  shall  evaluate  the
20    material submitted; and
21             (1)  advise the complainant of the action taken  and
22        disposition of its complaint;
23             (2)  pursue further investigation with respondent or
24        complainant; or
25             (3)  refer   the   investigation   report   to   the
26        appropriate  branch  within  the  Department  for further
27        regulatory action.
28        (e)  The Department of Public Health  and  Department  of
29    Insurance   shall   coordinate   the   complaint  review  and
30    investigation and establish joint rules  under  the  Illinois
31    Administrative  Procedure  Act  implementing this coordinated
32    complaint process.
33        Section 10-60.  Qualified utilization review programs.
                            -25-              LRB9001044JSgcB
 1        (a)  The  Director  shall  establish  standards  for  the
 2    certification of qualified utilization review programs.
 3        (b)  All programs must have a medical director, who is  a
 4    physician  licensed to practice medicine in all its branches,
 5    responsible for all clinical decisions by the program and who
 6    shall assure that the medical review or utilization practices
 7    they use, and the medical review or utilization practices  of
 8    payors  or reviewers with whom they contract, comply with the
 9    following requirements:
10             (1)  Screening  criteria,  weighing  elements,   and
11        computer  algorithms  utilized  in the review process and
12        their  method  of  development,  must  be   released   to
13        applicable  participating providers and be made available
14        to the public.
15             (2)  The criteria including,  but  not  limited  to,
16        pre-admission,   medical   necessity,   length  of  stay,
17        discharge  planning,  follow-up   care,   and   medically
18        acceptable treatment alternatives  must be based on sound
19        scientific  principles  and developed in cooperation with
20        practicing  physicians,  other   affected   health   care
21        providers, and consumer representatives.
22             (3)  Any person who recommends denial of coverage or
23        payment  or  determines  that  a  service  shall  not  be
24        provided  based  on  medical necessity standards, must be
25        licensed in Illinois and of the same licensed  profession
26        as  the  provider  who  provided, ordered or proposed the
27        services.
28             (4)  An enrollee or provider (upon assignment of  an
29        enrollee)  who  has  had  a claim denied as not medically
30        necessary must be  provided  an  opportunity  for  a  due
31        process  appeal  to  a  qualified physician consultant or
32        qualified provider peer review group not involved in  the
33        initial review.
34             (5)  Upon  request,  physicians  and  other affected
                            -26-              LRB9001044JSgcB
 1        health care providers shall be  provided  the  names  and
 2        credentials   of   all   individuals  conducting  medical
 3        necessity   or   appropriateness   review,   subject   to
 4        reasonable safeguards and standards.
 5             (6)  In  accordance   with   Section   5-45,   prior
 6        authorization  shall  not  be  required  for  care for an
 7        emergency, as defined in Section  3.5  of  the  Emergency
 8        Medical  Services  (EMS)  Systems  Act,  and  patient  or
 9        participating  provider  requests for prior authorization
10        of nonemergent health care services must be answered  the
11        same day as the request.
12             (7)  Qualified  personnel with the minimum licensure
13        status of registered professional nurse must be available
14        for  same-day  telephone  responses  to  inquiries  about
15        medical necessity, including certification  of  continued
16        length of stay.
17             (8)  Programs  and  managed  care  plans must ensure
18        that  enrollees,  in  managed  care  plans  where   prior
19        authorization  is  a  condition to coverage of a service,
20        are  informed  in  writing   of   the   reasons   medical
21        information  is  needed  and  provided  with  appropriate
22        medical  information  release consent forms for use where
23        services requiring prior authorization are recommended or
24        proposed by their participating providers.
25             (9)  When prior approval  for  a  service  or  other
26        covered item is obtained, it shall be considered approval
27        for  the   purpose  requested,  and  the service shall be
28        considered to be  covered,  in  accordance  with  Section
29        5-30.
30        Section 10-65.  Quality assurance requirements.
31        (a)  Every   managed  care  plan  shall  have  a  Quality
32    Assurance Plan developed by the Medical Review Board  through
33    a   designated  Quality  Assurance  Committee  or  through  a
                            -27-              LRB9001044JSgcB
 1    contract  with  a  physician  organization   for   measuring,
 2    assessing and improving quality.  The managed care plan must:
 3             (1)  Have  a  written  quality  assurance plan which
 4        sets standards and evaluates, at a minimum:
 5                  (A)  Provider availability and accessibility.
 6                  (B)  Appropriateness  of  care,  including  the
 7             provision of all medically necessary care.
 8                  (C)  Coordination and continuity of care.
 9                  (D)  Patient satisfaction.
10             (2)  Assess quality using:
11                  (A)  Enrollee and provider  quality  assessment
12             surveys to be conducted at least annually.
13                  (B)  A  log maintained by the managed care plan
14             including utilization review  functions  identifying
15             the   number  and  types  of  patient  and  provider
16             grievances with the resolutions to those issues.
17                  (C)  Utilization  and   outcome   reports   and
18             studies   whereby  relevant  case  mix  and  patient
19             demographic information are taken into account.
20             (3)  Establish mechanisms for  quality  improvement,
21        which  include  implementation of corrective action plans
22        in response to confirmed quality of care  or  quality  of
23        service identified problems.
24        The  Department  shall  require  managed  care  plans  to
25    prepare  and  submit  quarterly  aggregate  quality assurance
26    reports.  These reports shall include, but not be limited to,
27    provider   availability   and   accessibility   and   patient
28    satisfaction information compiled in aggregate  by  diagnosis
29    and  by participating provider category. Quality reports must
30    be made available, when requested, to prospective  enrollees,
31    enrollees, health care providers and the public.  The quality
32    assurance  information  or  data  may  not be released in any
33    manner which tends to identify any enrollee  or  health  care
34    provider.   This  information  or  data shall be afforded the
                            -28-              LRB9001044JSgcB
 1    protections of Section 8-2101 through 8-2105 of the  Code  of
 2    Civil Procedure.
 3        (b)  Every  managed  care plan shall implement procedures
 4    for ensuring that  all  applicable  federal  and  State  laws
 5    designed  to  protect  the  confidentiality  of  provider and
 6    individual medical records are followed.
 7        Section 10-70.  Application of certification standards.
 8        (a)  In general.  Standards shall first  be  established,
 9    under  this  Article,  by  no  later than 18 months after the
10    effective date of this Act.  In  developing  standards  under
11    this Article, the Director shall:
12             (1)  review  standards  in  use  by national private
13        accreditation organizations;
14             (2)  recognize,   to   the    extent    appropriate,
15        differences in the organizational structure and operation
16        of managed care plans, and utilization review programs;
17             (3)  establish    procedures    for    the    timely
18        consideration   of   applications  for  certification  by
19        managed care plans and utilization review programs; and
20             (4)  establish grievance  procedures  for  enrollees
21        and  participating  providers to appeal managed care plan
22        and utilization review program  decisions.
23        (b)  Revision   of   standards.    The   Director   shall
24    periodically review  the  standards  established  under  this
25    Article,  and  may  revise the standards from time to time to
26    assure that such standards continue  to  reflect  appropriate
27    policies  and  practices for the cost-effective and medically
28    appropriate use of health care services within  managed  care
29    plans and utilization review programs.
31        Section  20-5.   Responsibilities  of  the State Board of
                            -29-              LRB9001044JSgcB
 1    Health.
 2        (a)  The Board shall advise the Director regarding public
 3    health policy and managed care.
 4        (b)  The Board  shall  review  the  final  draft  of  all
 5    proposed  administrative  rules under this Act within 90 days
 6    of submission by the Department.  The Department  shall  take
 7    into  consideration  any  comments and recommendations of the
 8    Board regarding the proposed rules prior to submission to the
 9    Secretary  of  State  for  initial   publication.    If   the
10    Department  disagrees  with the recommendations of the Board,
11    it shall submit a written response outlining the reasons  for
12    not accepting the recommendations.
13        (c)  The  Board  shall  receive  and  report in aggregate
14    information from all reports mandated by law or rule.   These
15    reports  shall  be  made to the Illinois General Assembly and
16    the Governor.
17        (d)  The Board shall monitor  and  otherwise  advise  the
18    Department  on  the administration and enforcement of the Act
19    as the Board deems appropriate.
20        Section 20-10.  Responsibilities of the Department.
21        (a)  The Department shall, after  review  by  the  Board,
22    adopt  rules  for  managed  care  plan and utilization review
23    program certification under this Act that shall include,  but
24    not be limited to, the following:
25             (1)  Further  definition  of  managed care plans and
26        utilization review programs.
27             (2)  License application information required by the
28        Department.
29             (3)  Certification  requirements  for  managed  care
30        plans and utilization review programs.
31             (4)  License application and renewal fees which  may
32        cover   the   cost  of  administering  the  certification
33        program.
                            -30-              LRB9001044JSgcB
 1             (5)  Information including mandated reports that may
 2        be necessary for the Department and Board to monitor  and
 3        evaluate  the  certified  entities.   These reports shall
 4        include  but  not  be  limited  to  coverage   decisions,
 5        credentialing  decisions, participating provider capacity
 6        and any other necessary information.
 7             (6)  Administrative  fines  that  may  be   assessed
 8        against managed care plans or utilization review programs
 9        by the Department for violations of this Act or the rules
10        adopted under this Act.
11        (b)  The Department shall issue, renew, deny, suspend, or
12    revoke licenses for certification.
13        (c)  The  Department shall perform inspections of managed
14    care  plans  and  utilization  review  programs   as   deemed
15    necessary  by  the  Department to ensure compliance with this
16    Act or rules.
17        (d)  The  Department  shall  deposit  application   fees,
18    renewal  fees,  and  fines into the Regulatory Evaluation and
19    Basic Enforcement Fund.
20        (e)  All managed care plan and utilization review program
21    records  including  any  patient  records  reviewed  by   the
22    Department  shall  be  afforded  the  protections of Sections
23    8-2101 through 8-2105 of the Code of Civil Procedure.
24        Section 20-15.  Violations; penalties.
25        (a)  After July 1, 1998, any person opening, operating or
26    maintaining a managed care plan or utilization review program
27    without a certificate issued under this Act  and  any  person
28    who  violates  Sections  5-10  or  5-55  of this Act shall be
29    guilty of a business offense punishable upon conviction by  a
30    fine  of  $10,000.   Each  day  a  violation  continues shall
31    constitute a separate offense.
32        Section 20-20.  Conflicts.  To the extent of any conflict
                            -31-              LRB9001044JSgcB
 1    between this Act and any other Act, this   Act prevails  over
 2    the conflicting provision.
 3        Section  20-25.   Illinois  Administrative Procedure Act.
 4    The Illinois Administrative Procedure Act is hereby expressly
 5    adopted and  incorporated  herein  and  shall  apply  to  the
 6    Department  as  if  all  of  the  provisions of such Act were
 7    included in this Act; except  that  in  case  of  a  conflict
 8    between  the  Illinois  Administrative Procedure Act and this
 9    Act, the provisions of this Act shall control.
10        Section  20-30.   Certificate  denial,   suspension,   or
11    revocation and fine assessment.  A certificate may be denied,
12    suspended,  or  revoked,  the renewal of a certificate may be
13    denied, or an administrative fee may be assessed for  any  of
14    the following reasons:
15        (1)  Violation  of any provision of this Act or the rules
16    adopted by the Department under this Act.
17        (2)  Conviction of the owner or operator of the certified
18    entity (i) of a felony or (ii) of any other crime  under  the
19    laws  of  any state or of the United States arising out of or
20    in connection with the operation of a health  care  facility.
21    An  owner  shall  be  defined as any person with at least a 5
22    percent ownership interest in  the  entity.   The  record  of
23    conviction  or  a  certified  copy  of it shall be conclusive
24    evidence of conviction.
25        (3)  An encumbrance on a health care  license  issued  in
26    Illinois  or  any other state to the owner or operator of the
27    certified entity.
28        (4)  Revocation of any facility  license  issued  by  the
29    Department  during  the  previous  5  years  or  surrender or
30    expiration of the license during the pendency  of  action  by
31    the  Department  to  revoke or suspend the license during the
32    previous 5 years, if (i) the prior license was issued to  the
                            -32-              LRB9001044JSgcB
 1    individual  applicant  or  an owner  of the applicant or (ii)
 2    any affiliate of the individual applicant  or  owner  of  the
 3    applicant  or  affiliate  of the applicant was a owner of the
 4    prior license.
 5        Section 20-35.  Investigation of applicant or certificate
 6    holder; notice.  The Department may on its  own  motion,  and
 7    shall  on  the  verified  complaint  in writing of any person
 8    setting forth facts which if proven would constitute  grounds
 9    for  the  denial of an application for a certificate, refusal
10    to renew a  certificate,  suspension  of  a  certificate,  or
11    revocation  of  a  certificate,  investigate the applicant or
12    certificate holder.  The  Department,  after  notice  and  an
13    opportunity  for  a  hearing,  may  deny an application for a
14    certificate,  revoke  a  certificate,  refuse  to   renew   a
15    certificate  or  assess  an administrative fine under Section
16    20-30  of   this   Act.    Before   denying   a   certificate
17    application,  refusing  to  renew a certificate, suspending a
18    certificate, revoking a certificate, or assessing a fine, the
19    Department  shall notify the applicant or certificate  holder
20    in  writing.  The notice shall specify the charges or reasons
21    for the Department's contemplated action.  If  the  applicant
22    or  certificate  holder desires a hearing on the Department's
23    contemplated action, he or she must request a hearing  within
24    10  days  after receiving the notice.  A failure to request a
25    hearing within 10 days  shall  constitute  a  waiver  of  the
26    applicant's or certificate holder's right to a hearing.
27        Section  20-40.   Hearings.   The hearing requested under
28    Section 20-35 shall  be  conducted  by  the  Director  or  an
29    individual designated in writing by the Director as a hearing
30    officer.   The  Director  or  hearing  officer may compel, by
31    subpoena  or  subpoena  duces  tecum,  the   attendance   and
32    testimony  of  witnesses  and  the  production  of  books and
                            -33-              LRB9001044JSgcB
 1    papers.  The Director or hearing officer may administer oaths
 2    to witnesses.  The hearing shall  be  conducted  at  a  place
 3    designated  by  the  Department.   The  procedures  governing
 4    hearings  and  the  issuance  of  final orders under this Act
 5    shall be according to rules adopted by the  Department.   All
 6    subpoenas  issued  by  the Director or hearing officer may be
 7    served as in  civil  actions.   The  fees  of  witnesses  for
 8    attendance  and  travel  shall  be  the  same as the fees for
 9    witnesses before the circuit court and shall be paid  by  the
10    party  to  the  proceedings  at whose request the subpoena is
11    issued.  If a subpoena  is  issued  at  the  request  of  the
12    Department,  the  witness fee shall be paid by the Department
13    as an administrative expense.  If a witness refuses to attend
14    or testify, or to produce books  or  papers,  concerning  any
15    matter  on  which  he  or she might be lawfully examined, the
16    circuit court of the county in which the hearing is held,  on
17    application  of  any  party  to  the  proceeding,  may compel
18    obedience by a proceeding for  contempt  as  in  cases  of  a
19    refusal to obey a similar order of the court.
20        Section  20-45.   Final  orders.  The Director or hearing
21    officer shall make findings of fact and conclusions of law in
22    the matters that are the subject  of  the  hearing,  and  the
23    Director  shall  render  a decision, or the hearing officer a
24    proposal for decision, within 45 days after  the  termination
25    of  the  hearing  unless  additional  time is required by the
26    Director or hearing officer for a proper disposition  of  the
27    matter.   A  copy of the final decision of the Director shall
28    be served on the applicant or certificate holder in person or
29    by certified mail.
30        Section 20-50.  Judicial review; deposit for costs.
31        (a)  All final administrative decisions of the Department
32    under this Act shall be subject to judicial review under  the
                            -34-              LRB9001044JSgcB
 1    provisions  of  the  Administrative  Review Law and the rules
 2    adopted under that Law.  "Administrative decision" is defined
 3    as  in  Section  3-101  of  the  Code  of  Civil   Procedure.
 4    Proceedings  for  judicial  review  shall be commenced in the
 5    circuit court of the county in which the party  applying  for
 6    review  resides.   If  that  party  is not a resident of this
 7    State, however, the venue shall be in Sangamon County.
 8        (b)  The Department shall not be required to certify  any
 9    record  or  file  any  answer  or  otherwise  appear  in  any
10    proceeding  for  judicial  review unless the party filing the
11    complaint deposits with the clerk of the  circuit  court  the
12    sum  of  $0.95  per  page  for  the  costs  of certification.
13    Failure by the plaintiff to make the deposit shall be grounds
14    for dismissing the action.
15        Section 20-55.  Injunction.  The operation or maintenance
16    of a managed care  plan  or  utilization  review  program  in
17    violation  of  this  Act  or the rules adopted under this Act
18    including,  but  not  limited  to,  retaliation   against   a
19    physician  or  other  health  care provider is declared to be
20    inimical to the public welfare.  The Director, in addition to
21    other remedies provided in this Act, may bring an  action  in
22    the  name  of  the  People of the State, through the Attorney
23    General, for an injunction to restrain a  violation  of  this
24    Act  or  the  rules  or  to  enjoin  the  future operation or
25    maintenance of the managed care plan  or  utilization  review
26    program.
27        Section 20-60.  Managed care malpractice.  In any action,
28    whether  in  tort,  contract,  or otherwise, all managed care
29    plans and utilization review programs shall be held liable to
30    enrollees for any injuries incurred due to decisions  of  the
31    managed  care  plan or utilization review program that result
32    in unreasonable  delay,  reduction  or  denial  of  medically
                            -35-              LRB9001044JSgcB
 1    necessary health care services, care or treatment, covered by
 2    the enrollee's plan as recommended by a health care provider.
 3        Section  20-65.   Severability.  If any provision of this
 4    Act is held by a court to be invalid, such  invalidity  shall
 5    not  affect the remaining provisions of this Act, and to this
 6    end the provisions of this Act are hereby declared severable.
 8        Section 90-5.  The State Employees Group Insurance Act of
 9    1971 is amended by adding Section 6.9 as follows:
10        (5 ILCS 375/6.9 new)
11        Sec. 6.9.  Managed Care Patient Rights Act.  The  program
12    of  health  benefits  is  subject  to  the  provisions of the
13    Managed Care Patient Rights  Act  and  Section  356t  of  the
14    Illinois Insurance Code.
15        Section  90-10.   The  Counties Code is amended by adding
16    Section 5-1069.8 as follows:
17        (55 ILCS 5/5-1069.8 new)
18        Sec. 5-1069.8.  Managed Care  Patient  Rights  Act.   All
19    counties,  including  home  rule counties, are subject to the
20    provisions of the Managed Care Patient Rights Act and Section
21    356t of the Illinois Insurance Code.  The  requirement  under
22    this  Section  that health care benefits provided by counties
23    comply with  the  Managed  Care  Patient  Rights  Act  is  an
24    exclusive power and function of the State and is a denial and
25    limitation  of  home  rule  county  powers under Article VII,
26    Section 6, subsection (h) of the Illinois Constitution.
27        Section 90-15.  The Illinois Municipal Code is amended by
                            -36-              LRB9001044JSgcB
 1    adding 10-4-2.8 as follows:
 2        (65 ILCS 5/10-4-2.8 new)
 3        Sec. 10-4-2.8.  Managed Care  Patient  Rights  Act.   The
 4    corporate  authorities  of  all municipalities are subject to
 5    the provisions of the Managed Care  Patient  Rights  Act  and
 6    Section 356t of the Illinois Insurance Code.  The requirement
 7    under  this  Section  that  health  care benefits provided by
 8    municipalities comply with the Managed  Care  Patient  Rights
 9    Act  is an exclusive power and function of the State and is a
10    denial and limitation of home rule municipality powers  under
11    Article  VII,  Section  6,  subsection  (h)  of  the Illinois
12    Constitution.
13        Section 90-20.  The Illinois Insurance Code is changed by
14    adding Sections 155.31, 356t, 370s, and 511.118  as follows:
15        (215 ILCS 5/155.31 new)
16        Sec. 155.31.  Managed Care Patient Rights Act provisions.
17    Insurance  companies  providing  coverage  for  health   care
18    services  are  subject  to the provisions of the Managed Care
19    Patient Rights Act.  The provisions of Article  10  shall  be
20    implemented  through  existing  Department  of  Public Health
21    certification procedures.
22        (215 ILCS 5/356t new)
23        Sec. 356t.  Choice  requirements  for  point  of  service
24    plans.
25        (a)  An   employer,  self-insured  employer  or  employee
26    organization,  labor  union,  association  or  other   person
27    providing,  offering,  or  making  available  to employees or
28    individuals  a managed care plan, as defined in  the  Managed
29    Care  Patient  Rights  Act, shall offer to all  enrollees the
30    opportunity to obtain coverage  through a "point of  service"
                            -37-              LRB9001044JSgcB
 1    plan, at the time of enrollment and once annually thereafter.
 2    The "point of service" plan shall provide coverage for health
 3    care  services when such health care services are provided by
 4    any health care provider  without  the  necessary  referrals,
 5    prior authorization, or other utilization review requirements
 6    of the managed care plan.
 7        (b)  A  point  of service plan may charge an enrollee who
 8    opts to obtain  point  of  service  coverage  an  alternative
 9    premium  that  takes into account the actuarial value of such
10    coverage.
11        (c)  A point  of  service  plan  may  require  reasonable
12    payment  of  coinsurance,  co-payments  or  deductibles.  The
13    co-insurance rate on the point of service plan shall  not  be
14    greater  than 20 percentage points more than the co-insurance
15    rate on  the  underlying  plan.   The  maximum  out-of-pocket
16    amount  shall  not exceed $5,000 for an individual and $7,500
17    for family coverage.
18        (215 ILCS 5/370s new)
19        Sec.  370s.   Managed  Care  Patient  Rights  Act.    All
20    insurers  and administrators are subject to the provisions of
21    the  Managed Care Patient Rights Act and Section 356t of this
22    Code.
23        (215 ILCS 5/511.118 new)
24        Sec. 511.118.   Managed Care  Patient  Rights  Act.   All
25    administrators  are  subject to the provisions of the Managed
26    Care Patient Rights Act and Section 356t of this Code.
27        Section 90-25.  The Comprehensive Health  Insurance  Plan
28    Act is amended by adding Section 8.6 as follows:
29        (215 ILCS 105/8.6 new)
30        Sec.  8.6.   Managed  Care  Patient Rights Act.  The plan
                            -38-              LRB9001044JSgcB
 1    shall be subject  to  the  provisions  of  the  Managed  Care
 2    Patient Rights Act and Section 356t of the Illinois Insurance
 3    Code.
 4        Section  90-30.   The Health Maintenance Organization Act
 5    is amended by adding Section 5-3.5 as follows:
 6        (215 ILCS 125/5-3.5 new)
 7    Sec. 5-3.5.   Managed Care  Patient  Rights  Act  provisions.
 8    Health   maintenance   organizations   are   subject  to  the
 9    provisions Article 5, Sections 10-15,  10-20,  10-25,  10-30,
10    10-35,  10-40,  10-50, and 10-60 of Article 10 and Article 20
11    of the Managed Care Patient Rights Act and  Section  356t  of
12    the Illinois Insurance Code.
13        Section  90-35.   The Limited Health Service Organization
14    Act is amended by adding Section 4002.5 as follows:
15        (215 ILCS 130/4002.5 new)
16        Sec.  4002.5.     Managed   Care   Patient   Rights   Act
17    provisions.  Limited health service organizations are subject
18    to the provisions of the  Managed Care Patient Rights Act and
19    Section 356t of the Illinois Insurance Code.
20        Section 90-40.  The Dental Service Plan Act is amended by
21    adding Section 48 as follows:
22        (215 ILCS 110/48 new)
23        Sec.  48.   Managed  Care  Patient Rights Act provisions.
24    Dental Service Plans are subject to  the  provisions  of  the
25    Managed  Care  Patient  Rights  Act  and  Section 356t of the
26    Illinois Insurance Code.  For purposes of the Dental  Service
27    Plan  Act  the  term  physician  as  used in the Managed Care
28    Patient Rights Act shall mean dentist.
                            -39-              LRB9001044JSgcB
 1        Section 90-45.  The Voluntary Health Services  Plans  Act
 2    is amended by adding Section 15.25 as follows:
 3        (215 ILCS 165/15.25 new)
 4        Sec.  15.25.  Managed  Care Patient Rights Act.  A health
 5    service plan corporation is subject to the provisions of  the
 6    Managed  Care  Patient  Rights  Act  and  Section 356t of the
 7    Illinois Insurance Code.
 8        Section 90-50.  The Illinois Public Aid Code  is  amended
 9    by adding Section 5-16.8 as follows:
10        (305 ILCS 5/5-16.8 new)
11        Sec.  5-16.8.   Managed  Care  Patient  Rights  Act.  The
12    medical assistance program is subject to  the  provisions  of
13    the  Managed  Care Patient Rights Act and Section 356t of the
14    Illinois Insurance Code.  The Illinois Department shall adopt
15    rules to  implement  these  provisions.   These  rules  shall
16    require  compliance with Article 5, and Section 10-15, 10-20,
17    10-25, 10-30, 10-35, 10-40, 10-50 and 10-60 of Article 10  of
18    the Managed Care Patient Rights Act in the medical assistance
19    program  including managed care components defined in Section
20    5-16.3.
21                    ARTICLE 99.  EFFECTIVE DATE.
22        Section 99-1. Effective date.  This Act takes effect upon
23    becoming law.

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