Public Act 094-0906
 		





HB4125 Enrolled
LRB094 13838 LJB 48711 b






    AN ACT concerning insurance.

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

 
    Section 5. The Illinois Insurance Code is amended  by 
changing Section 370c as follows:
 



    (215 ILCS 5/370c)  (from Ch. 73, par. 982c)


    Sec. 370c. Mental and emotional disorders. 

    (a) (1) On and after the effective date of this Section,

every insurer which delivers, issues for delivery or renews or 
modifies
group A&H policies providing coverage for hospital or 
medical treatment or
services for illness on an 
expense-incurred basis shall offer to the
applicant or group 
policyholder subject to the insurers standards of

insurability, coverage for reasonable and necessary treatment 
and services
for mental, emotional or nervous disorders or 
conditions, other than serious
mental illnesses as defined in 
item (2) of subsection (b), up to the limits
provided in the 
policy for other disorders or conditions, except (i) the

insured may be required to pay up to 50% of expenses incurred 
as a result
of the treatment or services, and (ii) the annual 
benefit limit may be
limited to the lesser of $10,000 or 25% of 
the lifetime policy limit.

    (2) Each insured that is covered for mental, emotional or 
nervous
disorders or conditions shall be free to select the 
physician licensed to
practice medicine in all its branches, 
licensed clinical psychologist,
licensed clinical social 
worker, or licensed clinical professional counselor of
his 
choice to treat such disorders, and
the insurer shall pay the 
covered charges of such physician licensed to
practice medicine 
in all its branches, licensed clinical psychologist,
licensed 
clinical social worker, or licensed clinical professional 
counselor up
to the limits of coverage, provided (i)
the 
disorder or condition treated is covered by the policy, and 
(ii) the
physician, licensed psychologist, licensed clinical 
social worker, or licensed
clinical professional counselor is

authorized to provide said services under the statutes of this 
State and in
accordance with accepted principles of his 
profession.

    (3) Insofar as this Section applies solely to licensed 
clinical social
workers and licensed clinical professional 
counselors, those persons who may
provide services to 
individuals shall do so
after the licensed clinical social 
worker or licensed clinical professional
counselor has 
informed the patient of the
desirability of the patient 
conferring with the patient's primary care
physician and the 
licensed clinical social worker or licensed clinical

professional counselor has
provided written
notification to 
the patient's primary care physician, if any, that services
are 
being provided to the patient.  That notification may, however, 
be
waived by the patient on a written form.  Those forms shall 
be retained by
the licensed clinical social worker or licensed 
clinical professional counselor
for a period of not less than 5 
years.

    (b) (1) An insurer that provides coverage for hospital or 
medical
expenses under a group policy of accident and health 
insurance or
health care plan amended, delivered, issued, or 
renewed after the effective
date of this amendatory Act of the 
92nd General Assembly shall provide coverage
under the policy 
for treatment of serious mental illness under the same terms

and conditions as coverage for hospital or medical expenses 
related to other
illnesses and diseases.  The coverage required 
under this Section must provide
for same durational limits, 
amount limits, deductibles, and co-insurance
requirements for 
serious mental illness as are provided for other illnesses
and 
diseases.  This subsection does not apply to coverage provided 
to
employees by employers who have 50 or fewer employees.

    (2) "Serious mental illness" means the following 
psychiatric illnesses as
defined in the most current edition of 
the Diagnostic and Statistical Manual
(DSM) published by the 
American Psychiatric Association:


        (A) schizophrenia;


        (B) paranoid and other psychotic disorders;


        (C) bipolar disorders (hypomanic, manic, depressive, 
    and mixed);


        (D) major depressive disorders (single episode or 
    recurrent);


        (E) schizoaffective disorders (bipolar or depressive);


        (F) pervasive developmental disorders;


        (G) obsessive-compulsive disorders;


        (H) depression in childhood and adolescence;


        (I) panic disorder; and
        (J) post-traumatic stress disorders (acute, chronic, 
    or with delayed onset).


    (3) Upon request of the reimbursing insurer, a provider of 
treatment of
serious mental illness shall furnish medical 
records or other necessary data
that substantiate that initial 
or continued treatment is at all times medically
necessary.  An 
insurer shall provide a mechanism for the timely review by a

provider holding the same license and practicing in the same 
specialty as the
patient's provider, who is unaffiliated with 
the insurer, jointly selected by
the patient (or the patient's 
next of kin or legal representative if the
patient is unable to 
act for himself or herself), the patient's provider, and
the 
insurer in the event of a dispute between the insurer and 
patient's
provider regarding the medical necessity of a 
treatment proposed by a patient's
provider.  If the reviewing 
provider determines the treatment to be medically
necessary, 
the insurer shall provide reimbursement for the treatment.  
Future
contractual or employment actions by the insurer 
regarding the patient's
provider may not be based on the 
provider's participation in this procedure.
Nothing prevents

the insured from agreeing in writing to continue treatment at 
his or her
expense.  When making a determination of the medical 
necessity for a treatment
modality for serous mental illness, 
an insurer must make the determination in a
manner that is 
consistent with the manner used to make that determination with

respect to other diseases or illnesses covered under the 
policy, including an
appeals process.

    (4) A group health benefit plan:


        (A) shall provide coverage based upon medical 
    necessity for the following
treatment of mental illness in 
    each calendar year: ;


            (i) 45 days of inpatient treatment; and


            (ii) 35 visits for outpatient treatment including 
        group and individual
outpatient treatment; and
            (iii) for plans or policies delivered, issued for 
        delivery, renewed, or modified after the effective 
        date of this amendatory Act of the 94th General 
        Assembly,
20 additional outpatient visits for speech 
        therapy for treatment of pervasive developmental 
        disorders that will be in addition to speech therapy 
        provided pursuant to item (ii) of this subparagraph 
        (A);



        (B) may not include a lifetime limit on the number of 
    days of inpatient
treatment or the number of outpatient 
    visits covered under the plan; and


        (C) shall include the same amount limits, deductibles, 
    copayments, and
coinsurance factors for serious mental 
    illness as for physical illness.

    (5) An issuer of a group health benefit plan may not count 
toward the number
of outpatient visits required to be covered 
under this Section an outpatient
visit for the purpose of 
medication management and shall cover the outpatient
visits 
under the same terms and conditions as it covers outpatient 
visits for
the treatment of physical illness.

    (6) An issuer of a group health benefit
plan may provide or 
offer coverage required under this Section through a
managed 
care plan.

    (7) This Section shall not be interpreted to require a 
group health benefit
plan to provide coverage for treatment of:


        (A) an addiction to a controlled substance or cannabis 
    that is used in
violation of law; or


        (B) mental illness resulting from the use of a 
    controlled substance or
cannabis in violation of law.

    (8)
(Blank).

(Source: P.A. 94-402, eff. 8-2-05; P.A. 94-584, eff. 8-15-05; 
revised 8-19-05.)

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



    (215 ILCS 125/5-3)  (from Ch. 111 1/2, par. 1411.2)



    Sec. 5-3. Insurance Code provisions. 

    (a) Health Maintenance Organizations
shall be subject to 
the provisions of Sections 133, 134, 137, 140, 141.1,
141.2, 
141.3, 143, 143c, 147, 148, 149, 151,
152, 153, 154, 154.5, 
154.6,
154.7, 154.8, 155.04, 355.2, 356m, 356v, 356w, 356x, 
356y,
356z.2, 356z.4, 356z.5, 356z.6, 364.01, 367.2, 367.2-5, 
367i, 368a, 368b, 368c, 368d, 368e, 370c,
401, 401.1, 402, 403, 
403A,
408, 408.2, 409, 412, 444,
and
444.1,
paragraph (c) of 
subsection (2) of Section 367, and Articles IIA, VIII 1/2,
XII,

XII 1/2, XIII, XIII 1/2, XXV, and XXVI of the Illinois 
Insurance Code.

    (b) For purposes of the Illinois Insurance Code, except for 
Sections 444
and 444.1 and Articles XIII and XIII 1/2, Health 
Maintenance Organizations in
the following categories are 
deemed to be "domestic companies":


        (1) a corporation authorized under the
Dental Service 
    Plan Act or the Voluntary Health Services Plans Act;


        (2) a corporation organized under the laws of this 
    State; or


        (3) a corporation organized under the laws of another 
    state, 30% or more
of the enrollees of which are residents 
    of this State, except a
corporation subject to 
    substantially the same requirements in its state of

    organization as is a "domestic company" under Article VIII 
    1/2 of the
Illinois Insurance Code.

    (c) In considering the merger, consolidation, or other 
acquisition of
control of a Health Maintenance Organization 
pursuant to Article VIII 1/2
of the Illinois Insurance Code,


        (1) the Director shall give primary consideration to 
    the continuation of
benefits to enrollees and the financial 
    conditions of the acquired Health
Maintenance Organization 
    after the merger, consolidation, or other
acquisition of 
    control takes effect;


        (2)(i) the criteria specified in subsection (1)(b) of 
    Section 131.8 of
the Illinois Insurance Code shall not 
    apply and (ii) the Director, in making
his determination 
    with respect to the merger, consolidation, or other

    acquisition of control, need not take into account the 
    effect on
competition of the merger, consolidation, or 
    other acquisition of control;


        (3) the Director shall have the power to require the 
    following
information:


            (A) certification by an independent actuary of the 
        adequacy
of the reserves of the Health Maintenance 
        Organization sought to be acquired;


            (B) pro forma financial statements reflecting the 
        combined balance
sheets of the acquiring company and 
        the Health Maintenance Organization sought
to be 
        acquired as of the end of the preceding year and as of 
        a date 90 days
prior to the acquisition, as well as pro 
        forma financial statements
reflecting projected 
        combined operation for a period of 2 years;


            (C) a pro forma business plan detailing an 
        acquiring party's plans with
respect to the operation 
        of the Health Maintenance Organization sought to
be 
        acquired for a period of not less than 3 years; and


            (D) such other information as the Director shall 
        require.

    (d) The provisions of Article VIII 1/2 of the Illinois 
Insurance Code
and this Section 5-3 shall apply to the sale by 
any health maintenance
organization of greater than 10% of its

enrollee population (including without limitation the health 
maintenance
organization's right, title, and interest in and to 
its health care
certificates).

    (e) In considering any management contract or service 
agreement subject
to Section 141.1 of the Illinois Insurance 
Code, the Director (i) shall, in
addition to the criteria 
specified in Section 141.2 of the Illinois
Insurance Code, take 
into account the effect of the management contract or
service 
agreement on the continuation of benefits to enrollees and the

financial condition of the health maintenance organization to 
be managed or
serviced, and (ii) need not take into account the 
effect of the management
contract or service agreement on 
competition.

    (f) Except for small employer groups as defined in the 
Small Employer
Rating, Renewability and Portability Health 
Insurance Act and except for
medicare supplement policies as 
defined in Section 363 of the Illinois
Insurance Code, a Health 
Maintenance Organization may by contract agree with a
group or 
other enrollment unit to effect refunds or charge additional 
premiums
under the following terms and conditions:


        (i) the amount of, and other terms and conditions with 
    respect to, the
refund or additional premium are set forth 
    in the group or enrollment unit
contract agreed in advance 
    of the period for which a refund is to be paid or

    additional premium is to be charged (which period shall not 
    be less than one
year); and


        (ii) the amount of the refund or additional premium 
    shall not exceed 20%
of the Health Maintenance 
    Organization's profitable or unprofitable experience
with 
    respect to the group or other enrollment unit for the 
    period (and, for
purposes of a refund or additional 
    premium, the profitable or unprofitable
experience shall 
    be calculated taking into account a pro rata share of the

    Health Maintenance Organization's administrative and 
    marketing expenses, but
shall not include any refund to be 
    made or additional premium to be paid
pursuant to this 
    subsection (f)).  The Health Maintenance Organization and 
    the
group or enrollment unit may agree that the profitable 
    or unprofitable
experience may be calculated taking into 
    account the refund period and the
immediately preceding 2 
    plan years.

    The Health Maintenance Organization shall include a 
statement in the
evidence of coverage issued to each enrollee 
describing the possibility of a
refund or additional premium, 
and upon request of any group or enrollment unit,
provide to 
the group or enrollment unit a description of the method used 
to
calculate (1) the Health Maintenance Organization's 
profitable experience with
respect to the group or enrollment 
unit and the resulting refund to the group
or enrollment unit 
or (2) the Health Maintenance Organization's unprofitable

experience with respect to the group or enrollment unit and the 
resulting
additional premium to be paid by the group or 
enrollment unit.

    In no event shall the Illinois Health Maintenance 
Organization
Guaranty Association be liable to pay any 
contractual obligation of an
insolvent organization to pay any 
refund authorized under this Section.

(Source: P.A. 92-764, eff. 1-1-03; 93-102, eff. 1-1-04; 93-261, 
eff. 1-1-04; 93-477, eff. 8-8-03; 93-529, eff. 8-14-03; 93-853, 
eff. 1-1-05; 93-1000, eff. 1-1-05; revised 10-14-04.)