State of Illinois
91st General Assembly
Legislation

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91_SB1969

 
                                               LRB9109009JSpc

 1        AN  ACT  to  amend  the  Managed  Care Reform and Patient
 2    Rights Act by adding Section 97.

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

 5        Section  5.  The  Managed  Care Reform and Patient Rights
 6    Act is amended by adding Section 97 as follows:

 7        (215 ILCS 134/97 new)
 8        Sec. 97.  Health care entity liability.
 9        (a)  In this Section:
10        "Appropriate and medically necessary" means the  standard
11    for  health  care  services  as  determined by physicians and
12    health care  providers  in  accordance  with  the  prevailing
13    practices   and  standards  of  the  medical  profession  and
14    community.
15        "Enrollee" means an  individual  who  is  enrolled  in  a
16    health care plan, including covered dependents.
17        "Health  care  plan"  means  any  plan whereby any person
18    undertakes to provide, arrange for, pay for, or reimburse any
19    part of the cost of any health care services.
20        "Health care  provider"  means  a  person  or  entity  as
21    defined in Section 2-1003 of the Code of Civil Procedure.
22        "Health  care  treatment  decision" means a determination
23    made when medical  services  are  actually  provided  by  the
24    health  care  plan and a decision that affects the quality of
25    the diagnosis, care, or  treatment  provided  to  the  plan's
26    insureds or enrollees.
27        "Health  insurance carrier" means an authorized insurance
28    company that issues policies of accident and health insurance
29    under the Illinois Insurance Code.
30        "Health maintenance organization" means  an  organization
31    licensed under the Health Maintenance Organization Act.
 
                            -2-                LRB9109009JSpc
 1        "Managed  care  entity"  means  any entity that delivers,
 2    administers, or assumes risk for health  care  services  with
 3    systems  or  techniques  to control or influence the quality,
 4    accessibility, utilization, or  costs  and  prices  of  those
 5    services  to  a  defined  enrollee  population,  but does not
 6    include an employer purchasing coverage or acting  on  behalf
 7    of its employees or the employees of one or more subsidiaries
 8    or affiliated corporations of the employer.
 9        "Physician" means: (1) an individual licensed to practice
10    medicine  in  this  State;  (2)  a  professional association,
11    professional  service   corporation,   partnership,   medical
12    corporation,   or  limited  liability  company,  entitled  to
13    lawfully engage in the practice of medicine; or  (3)  another
14    person wholly owned by physicians.
15        "Ordinary  care" means, in the case of a health insurance
16    carrier, health maintenance  organization,  or  managed  care
17    entity,  that degree of care that a health insurance carrier,
18    health maintenance organization, or managed  care  entity  of
19    ordinary  prudence  would  use  under  the  same  or  similar
20    circumstances.   In  the case of a person who is an employee,
21    agent,  ostensible  agent,  or  representative  of  a  health
22    insurance  carrier,  health  maintenance   organization,   or
23    managed  care  entity,  "ordinary  care" means that degree of
24    care  that  a  person  of  ordinary  prudence  in  the   same
25    profession,  specialty,  or  area  of practice as such person
26    would use in the same or similar circumstances.
27        (b)  A  health  insurance  carrier,  health   maintenance
28    organization,  or other managed care entity for a health care
29    plan has the duty  to  exercise  ordinary  care  when  making
30    health care treatment decisions and is liable for damages for
31    harm  to  an  insured  or  enrollee proximately caused by its
32    failure to exercise such ordinary care.
33        (c)  A  health  insurance  carrier,  health   maintenance
34    organization,  or other managed care entity for a health care
 
                            -3-                LRB9109009JSpc
 1    plan is also liable for damages for harm  to  an  insured  or
 2    enrollee  proximately  caused  by  the  health care treatment
 3    decisions made by its:
 4             (1)  employees;
 5             (2)  agents;
 6             (3)  ostensible agents; or
 7             (4)  representatives who are acting  on  its  behalf
 8        and  over  whom it has the right to exercise influence or
 9        control or has actually exercised  influence  or  control
10        that results in the failure to exercise ordinary care.
11        (d)  The  standards  in subsections (b) and (c) create no
12    obligation on the  part  of  the  health  insurance  carrier,
13    health maintenance organization, or other managed care entity
14    to  provide  to  an insured or enrollee treatment that is not
15    covered by the health care plan of the entity.
16        (e)  A  health  insurance  carrier,  health   maintenance
17    organization,  or  managed  care  entity  may  not  remove  a
18    physician  or health care provider from its plan or refuse to
19    renew the physician or health care provider with its plan for
20    advocating on behalf  of  an  enrollee  for  appropriate  and
21    medically necessary health care for the enrollee.
22        (f)  A   health  insurance  carrier,  health  maintenance
23    organization, or other managed care entity may not enter into
24    a contract with a physician, hospital, or other  health  care
25    provider   or   pharmaceutical   company  which  includes  an
26    indemnification or hold  harmless  clause  for  the  acts  or
27    conduct  of  the health insurance carrier, health maintenance
28    organization,  or  other  managed  care  entity.   Any   such
29    indemnification  or  hold  harmless  clause  in  an  existing
30    contract is hereby declared void.
31        (g)  Nothing  in  any  law  of  this  State prohibiting a
32    health insurance carrier, health maintenance organization, or
33    other managed care entity from practicing medicine  or  being
34    licensed to practice medicine may be asserted as a defense by
 
                            -4-                LRB9109009JSpc
 1    the    health    insurance    carrier,   health   maintenance
 2    organization, or other  managed  care  entity  in  an  action
 3    brought against it pursuant to this Section or any other law.
 4        (h)  In  an  action  against  a health insurance carrier,
 5    health maintenance organization, or managed  care  entity,  a
 6    finding  that a physician or other health care provider is an
 7    employee, agent, ostensible agent, or representative  of  the
 8    health insurance carrier, health maintenance organization, or
 9    managed  care  entity shall not be based solely on proof that
10    the person's name appears in a listing of approved physicians
11    or health  care  providers  made  available  to  insureds  or
12    enrollees under a health care plan.
13        (i)  This Section does not apply to workers' compensation
14    insurance coverage subject to the Workers' Compensation Act.
15        (j)  This  Section does not apply to actions seeking only
16    a review of  an  adverse  utilization  review  determination.
17    This  Section applies only to causes of action that accrue on
18    or after the effective  date  of  this  Act.  An  insured  or
19    enrollee seeking damages under this Section has the right and
20    duty  to  submit  the claim to arbitration in accordance with
21    the  Uniform  Arbitration  Act.   No  agreement  between  the
22    parties to submit the claim to arbitration is  necessary.   A
23    health insurance carrier, health maintenance organization, or
24    managed  care  entity  shall  have  no  liability  under this
25    Section unless the claim is first submitted to arbitration in
26    accordance with the Uniform Arbitration Act.   The  award  in
27    matters  arbitrated  pursuant  to  this Section shall be made
28    within 30 days  after  notification  of  the  arbitration  is
29    provided to all parties.
30        (k)  The   determination   of   whether  a  procedure  or
31    treatment is medically necessary must be made by a physician.
32        (l)  If the physician  determines  that  a  procedure  or
33    treatment  is  medically necessary, the health care plan must
34    pay for the procedure or treatment.
 
                            -5-                LRB9109009JSpc
 1        (m)  This Section does not apply  to  licensed  insurance
 2    agents.

 3        Section  99.  Effective date.  This Act takes effect upon
 4    becoming law.

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