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91_HB0626ham001
LRB9100964JSmbam02
1 AMENDMENT TO HOUSE BILL 626
2 AMENDMENT NO. . Amend House Bill 626 by replacing
3 everything after the enacting clause with the following:
4 "Section 1. Short title. This Act may be cited as the
5 Managed Care Reform Act.
6 Section 5. Definitions. For purposes of this Act, the
7 following words shall have the meanings provided in this
8 Section, unless otherwise indicated:
9 "Adverse determination" means a determination by a
10 utilization review program that an admission, extension of a
11 stay, or other health care service has been reviewed and,
12 based on the information provided, is not medically
13 necessary.
14 "Clinical" means medical, nursing, or other health care
15 professional opinion, decision, or judgment.
16 "Clinical peer reviewer" or "clinical personnel" means:
17 (1) in the case of physician reviewers, a State
18 licensed physician who is of the same category in the
19 same or similar specialty as the health care provider who
20 typically manages the medical condition, procedure or
21 treatment under review; or
22 (2) in the case of non-physician reviewers, a State
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1 licensed or registered health care professional who is in
2 the same profession and same or similar specialty as the
3 health care provider who typically manages the medical
4 condition, procedure, or treatment under review.
5 Nothing herein shall be construed to change any
6 statutorily defined scope of practice.
7 "Department" means the Department of Insurance.
8 "Director" means the Director of Insurance.
9 "Emergency medical condition" means a medical condition
10 manifesting itself by acute symptoms of sufficient severity
11 (including but not limited to severe pain) such that a
12 prudent layperson, who possesses an average knowledge of
13 health and medicine, could reasonably expect the absence of
14 immediate medical attention to result in:
15 (1) placing the health of the individual (or, with
16 respect to a pregnant woman, the health of the woman or
17 her unborn child) in serious jeopardy;
18 (2) serious impairment to bodily functions; or
19 (3) serious dysfunction of any bodily organ or
20 part.
21 "Emergency medical screening examination" means a medical
22 screening examination and evaluation by a physician licensed
23 to practice medicine in all its branches or, to the extent
24 permitted by applicable laws, by other appropriate personnel
25 under the supervision of or in collaboration with a physician
26 licensed to practice medicine in all its branches to
27 determine whether the need for emergency services exists.
28 "Emergency services" means, with respect to an enrollee
29 of a managed care plan, transportation services and covered
30 inpatient and outpatient hospital services furnished by a
31 provider qualified to furnish those services that are needed
32 to evaluate or stabilize an emergency medical condition.
33 "Emergency services" does not refer to post-stabilization
34 medical services.
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1 "Enrollee" means a person enrolled in a managed care
2 plan.
3 "Health care professional" means a physician, registered
4 professional nurse, or other person appropriately licensed or
5 registered pursuant to the laws of this State to provide
6 health care services.
7 "Health care provider" means a health care professional,
8 hospital, facility, or other person appropriately licensed or
9 otherwise authorized to furnish health care services or
10 arrange for the delivery of health care services in this
11 State.
12 "Health care services" means any services included in the
13 furnishing to any individual of medical care, or the
14 hospitalization or incident to the furnishing of such care or
15 hospitalization as well as the furnishing to any person of
16 any and all other services for the purpose of preventing,
17 alleviating, curing, or healing human illness or injury
18 including home health and pharmaceutical services and
19 products.
20 "Informal policy or procedure" means a nonwritten policy
21 or procedure, the existence of which may be proven by an
22 admission of an authorized agent of a managed care plan or
23 statistical evidence supported by anecdotal evidence.
24 "Managed care plan" means a plan that establishes,
25 operates, or maintains a network of health care providers
26 that have entered into agreements with the plan to provide
27 health care services to enrollees where the plan has the
28 ultimate obligation to the enrollee to arrange for the
29 provision of or pay for services through:
30 (1) organizational arrangements for ongoing quality
31 assurance, utilization review programs, or dispute
32 resolution; or
33 (2) financial incentives for persons enrolled in
34 the plan to use the participating providers and
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1 procedures covered by the plan.
2 A managed care plan may be established or operated by any
3 entity including, but not necessarily limited to, a licensed
4 insurance company, hospital or medical service plan, health
5 maintenance organization, limited health service
6 organization, preferred provider organization, third party
7 administrator, independent practice association, or employer
8 or employee organization.
9 For purposes of this definition, "managed care plan"
10 shall not include the following:
11 (1) strict indemnity health insurance policies or
12 plans issued by an insurer that does not require approval
13 of a primary care provider or other similar coordinator
14 to access health care services;
15 (2) managed care plans that offer only dental or
16 vision coverage;
17 (3) employee or employer self-insured health
18 benefit plans preempted from State regulation under the
19 federal Employee Retirement Income Security Act of 1974;
20 (4) not-for-profit health maintenance organizations
21 in existence as of January 1, 1999 and affiliated with a
22 union which only extend coverage to union members; and
23 (5) health care provided pursuant to the Workers'
24 Compensation Act or the Workers' Occupational Diseases
25 Act.
26 "Medical director" means a physician licensed in any
27 state to practice medicine in all its branches appointed by a
28 managed care plan.
29 "Person" means a corporation, association, partnership,
30 limited liability company, sole proprietorship, or any other
31 legal entity.
32 "Physician" means a person licensed under the Medical
33 Practice Act of 1987.
34 "Post-stabilization medical services" means health care
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1 services provided to an enrollee that are furnished in a
2 licensed hospital by a physician or health care provider that
3 is qualified to furnish such services, and determined to be
4 medically necessary and directly related to the emergency
5 medical condition following stabilization.
6 "Primary care" means the provision of a broad range of
7 personal health care services (preventive, diagnostic,
8 curative, counseling, or rehabilitative) in a manner that is
9 accessible and comprehensive and coordinated by a physician
10 licensed to practice medicine in all its branches.
11 "Primary care physician" means a physician who has
12 contracted with a managed care plan to provide primary care
13 services as defined by the contract and who is a physician
14 licensed to practice medicine in all of its branches. Nothing
15 in this definition shall be construed to prohibit a managed
16 care plan from requiring a physician to meet a managed care
17 plan's criteria in order to coordinate access to health care.
18 "Stabilization" means, with respect to an emergency
19 medical condition, to provide such medical treatment of the
20 condition as may be necessary to assure, within reasonable
21 medical probability, that no material deterioration of the
22 condition is likely to result from or occur during the
23 transfer of the enrollee from a facility.
24 "Specialist" means a health care professional who
25 concentrates practice in a recognized specialty field of
26 care.
27 "Utilization review" means the evaluation of the medical
28 necessity, appropriateness, and efficiency of the use of
29 health care services, procedures, and facilities.
30 "Utilization review program" means a program established
31 by a person to perform utilization review.
32 Section 10. Disclosure of information.
33 (a) An enrollee, and upon request a prospective enrollee
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1 prior to enrollment, shall be supplied with written
2 disclosure information, containing at least the information
3 specified in this Section, if applicable, which may be
4 incorporated into the member handbook or the enrollee
5 contract or certificate. All written descriptions shall be in
6 readable and understandable format, consistent with standards
7 developed for supplemental insurance coverage under Title
8 XVIII of the Social Security Act. The Department shall
9 promulgate rules to standardize this format so that potential
10 enrollees can compare the attributes of the various managed
11 care plans. In the event of any inconsistency between any
12 separate written disclosure statement and the enrollee
13 contract or certificate, the terms of the enrollee contract
14 or certificate shall be controlling. The information to be
15 disclosed shall include, at a minimum, all of the following:
16 (1) A description of coverage provisions, health
17 care benefits, benefit maximums, including benefit
18 limitations, and exclusions of coverage, including the
19 definition of medical necessity used in determining
20 whether benefits will be covered.
21 (2) A description of all prior authorization or
22 other requirements for treatments, pharmaceuticals, and
23 services.
24 (3) A description of utilization review policies
25 and procedures used by the managed care plan, including
26 the circumstances under which utilization review will be
27 undertaken, the toll-free telephone number of the
28 utilization review program, the timeframes under which
29 utilization review decisions must be made for
30 prospective, retrospective, and concurrent decisions, the
31 right to reconsideration, the right to an appeal,
32 including the expedited and standard appeals processes
33 and the timeframes for those appeals, the right to
34 designate a representative, a notice that all denials of
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1 claims will be made by clinical personnel, and that all
2 notices of denials will include information about the
3 basis of the decision and further appeal rights, if any.
4 (4) A description prepared annually of the types of
5 methodologies the managed care plan uses to reimburse
6 providers specifying the type of methodology that is used
7 to reimburse particular types of providers or reimburse
8 for the provision of particular types of services,
9 provided, however, that nothing in this item should be
10 construed to require disclosure of individual contracts
11 or the specific details of any financial arrangement
12 between a managed care plan and a health care provider.
13 (5) An explanation of a enrollee's financial
14 responsibility for payment of premiums, coinsurance,
15 co-payments, deductibles, and any other charges, annual
16 limits on an enrollee's financial responsibility, caps on
17 payments for covered services and financial
18 responsibility for non-covered health care procedures,
19 treatments, or services provided within the managed care
20 plan.
21 (6) An explanation of an enrollee's financial
22 responsibility for payment when services are provided by
23 a health care provider who is not part of the managed
24 care plan or by any provider without required
25 authorization or when a procedure, treatment, or service
26 is not a covered health care benefit.
27 (7) A description of the grievance procedures to be
28 used to resolve disputes between a managed care plan and
29 an enrollee, including the right to file a grievance
30 regarding any dispute between an enrollee and a managed
31 care plan, the right to file a grievance orally when the
32 dispute is about referrals or covered benefits, the
33 toll-free telephone number that enrollees may use to file
34 an oral grievance, the timeframes and circumstances for
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1 expedited and standard grievances, the right to appeal a
2 grievance determination and the procedures for filing the
3 appeal, the timeframes and circumstances for expedited
4 and standard appeals, the right to designate a
5 representative, a notice that all disputes involving
6 clinical decisions will be made by clinical personnel,
7 and that all notices of determination will include
8 information about the basis of the decision and further
9 appeal rights, if any.
10 (8) A description of the procedure for providing
11 care and coverage 24 hours a day for emergency services.
12 The description shall include the definition of emergency
13 services, notice that emergency services are not subject
14 to prior approval, and an explanation of the enrollee's
15 financial and other responsibilities regarding obtaining
16 those services, including when those services are
17 received outside the managed care plan's service area.
18 (9) A description of procedures for enrollees to
19 select and access the managed care plan's primary and
20 specialty care providers, including notice of how to
21 determine whether a participating provider is accepting
22 new patients.
23 (10) A description of the procedures for changing
24 primary and specialty care providers within the managed
25 care plan.
26 (11) Notice that an enrollee may obtain a referral
27 to a health care provider outside of the managed care
28 plan's network or panel when the managed care plan does
29 not have a health care provider with appropriate training
30 and experience in the network or panel to meet the
31 particular health care needs of the enrollee and the
32 procedure by which the enrollee can obtain the referral.
33 (12) Notice that an enrollee with a condition that
34 requires ongoing care from a specialist may request a
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1 standing referral to the specialist and the procedure for
2 requesting and obtaining a standing referral.
3 (13) Notice that an enrollee with (i) a
4 life-threatening condition or disease or (ii) a
5 degenerative or disabling condition or disease, either of
6 which requires specialized medical care over a prolonged
7 period of time, may request a specialist responsible for
8 providing or coordinating the enrollee's medical care and
9 the procedure for requesting and obtaining the
10 specialist.
11 (14) A description of the mechanisms by which
12 enrollees may participate in the development of the
13 policies of the managed care plan.
14 (15) A description of how the managed care plan
15 addresses the needs of non-English speaking enrollees.
16 (16) Notice of all appropriate mailing addresses
17 and telephone numbers to be utilized by enrollees seeking
18 information or authorization.
19 (17) A listing by specialty, which may be in a
20 separate document that is updated annually, of the name,
21 address, and telephone number of all participating
22 providers, including facilities, and, in addition, in the
23 case of physicians, category of license and board
24 certification, if applicable.
25 (b) Upon request of an enrollee or prospective enrollee,
26 a managed care plan shall do all of the following:
27 (1) Provide a list of the names, business
28 addresses, and official positions of the members of the
29 board of directors, officers, controlling persons,
30 owners, and partners of the managed care plan.
31 (2) Provide a copy of the most recent annual
32 certified financial statement of the managed care plan,
33 including a balance sheet and summary of receipts and
34 disbursements and the ratio of (i) premium dollars going
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1 to administrative expenses to (ii) premium dollars going
2 to direct care, prepared by a certified public
3 accountant. The Department shall promulgate rules to
4 standardize the information that must be contained in the
5 statement and the statement's format.
6 (3) Provide information relating to consumer
7 complaints compiled in accordance with subsection (b) of
8 Section 25 of this Act and the rules promulgated under
9 this Act.
10 (4) Provide the procedures for protecting the
11 confidentiality of medical records and other enrollee
12 information.
13 (5) Allow enrollees and prospective enrollees to
14 inspect drug formularies used by the managed care plan
15 and disclose whether individual drugs are included or
16 excluded from coverage and whether a drug requires prior
17 authorization. An enrollee or prospective enrollee may
18 seek information as to the inclusion or exclusion of a
19 specific drug. A managed care plan need only release the
20 information if the enrollee or prospective enrollee or
21 his or her dependent needs, used, or may need or use the
22 drug.
23 (6) Provide a written description of the
24 organizational arrangements and ongoing procedures of the
25 managed care plan's quality assurance program.
26 (7) Provide a description of the procedures
27 followed by the managed care plan in making decisions
28 about the experimental or investigational nature of
29 individual drugs, medical devices, or treatments in
30 clinical trials.
31 (8) Provide individual health care professional
32 affiliations with participating hospitals, if any.
33 (9) Upon written request, provide specific written
34 clinical review criteria relating to a particular
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1 condition or disease and, where appropriate, other
2 clinical information that the managed care plan might
3 consider in its utilization review; the managed care plan
4 may include with the information a description of how it
5 will be used in the utilization review process. An
6 enrollee or prospective enrollee may seek information as
7 to specific clinical review criteria. A managed care
8 plan need only release the information if the enrollee or
9 prospective enrollee or his or her dependent has, may
10 have, or is at risk of contracting a particular condition
11 or disease.
12 (10) Provide the written application procedures and
13 minimum qualification requirements for health care
14 providers to be considered by the managed care plan.
15 (11) Disclose other information as required by the
16 Director.
17 (12) To the extent the information provided under
18 item (5) or (9) of this subsection is proprietary to the
19 managed care plan, the enrollee or prospective enrollee
20 shall only use the information for the purposes of
21 assisting the enrollee or prospective enrollee in
22 evaluating the covered services provided by the managed
23 care plan. Any misuse of proprietary data is prohibited,
24 provided that the managed care plan has labeled or
25 identified the data as proprietary.
26 (c) Nothing in this Section shall prevent a managed care
27 plan from changing or updating the materials that are made
28 available to enrollees or prospective enrollees.
29 (d) If a primary care provider ceases participation in
30 the managed care plan, the managed care plan shall provide
31 written notice within 15 business days from the date that the
32 managed care plan becomes aware of the change in status to
33 each of the enrollees who have chosen the provider as their
34 primary care provider. If an enrollee is in an ongoing course
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1 of treatment with any other participating provider who
2 becomes unavailable to continue to provide services to the
3 enrollee and the managed care plan is aware of the ongoing
4 course of treatment, the managed care plan shall provide
5 written notice within 15 business days from the date that the
6 managed care plan becomes aware of the unavailability to the
7 enrollee. The notice shall also describe the procedures for
8 continuing care.
9 (e) A managed care plan offering to indemnify enrollees
10 for non-participating provider services shall file a report
11 with the Director twice a year showing the percentage
12 utilization for the preceding 6 month period of
13 non-participating provider services in such form and
14 providing such other information as the Director shall
15 prescribe.
16 (f) The written information disclosure requirements of
17 this Section may be met by disclosure to one enrollee in a
18 household.
19 Section 15. General grievance procedure.
20 (a) A managed care plan shall establish and maintain a
21 grievance procedure, as described in this Act. Compliance
22 with this Act's grievance procedures shall satisfy a managed
23 care plan's obligation to provide grievance procedures under
24 any other State law or rules.
25 A copy of the grievance procedures, including all forms
26 used to process a grievance, shall be filed with the
27 Director. Any subsequent material modifications to the
28 documents also shall be filed. In addition, a managed care
29 plan shall file annually with the Director a certificate of
30 compliance stating that the managed care plan has established
31 and maintains, for each of its plans, grievance procedures
32 that fully comply with the provisions of this Act. The
33 Director has authority to disapprove a filing that fails to
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1 comply with this Act or applicable rules.
2 (b) A managed care plan shall provide written notice of
3 the grievance procedure to all enrollees in the member
4 handbook and to an enrollee at any time that the managed care
5 plan denies access to a referral or determines that a
6 requested benefit is not covered pursuant to the terms of the
7 contract. In the event that a managed care plan denies a
8 service as an adverse determination, the managed care plan
9 shall inform the enrollee or the enrollee's designee of the
10 appeal rights under this Act.
11 The notice to an enrollee describing the grievance
12 process shall explain the process for filing a grievance with
13 the managed care plan, the timeframes within which a
14 grievance determination must be made, and the right of an
15 enrollee to designate a representative to file a grievance on
16 behalf of the enrollee. Information required to be disclosed
17 or provided under this Section must be provided in a
18 reasonable and understandable format.
19 The managed care plan shall assure that the grievance
20 procedure is reasonably accessible to those who do not speak
21 English.
22 (c) A managed care plan shall not retaliate or take any
23 discriminatory action against an enrollee because an enrollee
24 has filed a grievance or appeal or requested an external
25 independent review.
26 Section 20. Grievance review.
27 (a) The managed care plan may require an enrollee to
28 file a grievance in writing, by letter or by a grievance form
29 which shall be made available by the managed care plan,
30 however, an enrollee must be allowed to submit an oral
31 grievance in connection with (i) a denial of, or failure to
32 pay for, a referral or service or (ii) a determination as to
33 whether a benefit is covered pursuant to the terms of the
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1 enrollee's contract. A grievance may also be filed by a
2 health care professional or health care provider. In
3 connection with the submission of an oral grievance, a
4 managed care plan shall, within 24 hours, reduce the
5 complaint to writing and give the enrollee written
6 acknowledgment of the grievance prepared by the managed care
7 plan summarizing the nature of the grievance and requesting
8 any information that the enrollee needs to provide before the
9 grievance can be processed. The acknowledgment shall be
10 mailed within the 24-hour period to the enrollee, who shall
11 sign and return the acknowledgment, with any amendments and
12 requested information, in order to initiate the grievance.
13 The grievance acknowledgment shall prominently state that the
14 enrollee must sign and return the acknowledgment to initiate
15 the grievance. A managed care plan may elect not to require a
16 signed acknowledgment when no additional information is
17 necessary to process the grievance, and an oral grievance
18 shall be initiated at the time of the telephone call.
19 Except as authorized in this subsection, a managed care
20 plan shall designate personnel to accept the filing of an
21 enrollee's grievance by toll-free telephone no less than 40
22 hours per week during normal business hours and shall have a
23 telephone system available to take calls during other than
24 normal business hours and shall respond to all such calls no
25 later than the next business day after the call was recorded.
26 In the case of grievances subject to item (i) of subsection
27 (b) of this Section, telephone access must be available on a
28 24 hour a day, 7 day a week basis.
29 (b) Within 48 hours of receipt of a written grievance,
30 the managed care plan shall provide written acknowledgment of
31 the grievance, including the name, address, qualifying
32 credentials, and telephone number of the individuals or
33 department designated by the managed care plan to respond to
34 the grievance. All grievances shall be resolved in an
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1 expeditious manner, and in any event, no more than (i) 24
2 hours after the receipt of all necessary information when a
3 delay would significantly increase the risk to an enrollee's
4 health or when extended health care services, procedures, or
5 treatments for an enrollee undergoing a course of treatment
6 prescribed by a health care provider are at issue, (ii) 15
7 days after the receipt of all necessary information in the
8 case of requests for referrals or determinations concerning
9 whether a requested benefit is covered pursuant to the
10 contract, and (iii) 30 days after the receipt of all
11 necessary information in all other instances.
12 (c) The managed care plan shall designate one or more
13 qualified personnel to review the grievance. When the
14 grievance pertains to medical or clinical matters, the
15 personnel shall include, but not be limited to, one or more
16 appropriately licensed or registered health care
17 professionals. When the grievance pertains to non-medical or
18 non-clinical matters, the personnel making the determination
19 must have had no involvement in the initial determination and
20 be at a higher level than the personnel who made the initial
21 grievance determination.
22 (d) The notice of a determination of the grievance shall
23 be made in writing to the enrollee or to the enrollee's
24 designee. In the case of a determination made in conformance
25 with item (i) of subsection (b) of this Section, notice shall
26 be made by telephone directly to the enrollee with written
27 notice to follow within 2 business days.
28 (e) The notice of a determination shall include (i)
29 clear and detailed reasons for the determination, including
30 any contract basis for the determination, and the evidence
31 relied upon in making that determination, (ii) in cases where
32 the determination has a medical or clinical basis, the
33 medical or clinical criteria for the determination, and (iii)
34 the procedures for the filing of an appeal of the
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1 determination, including a form for the filing of an appeal,
2 requesting an external independent review, and filing a
3 complaint with the Department of Insurance.
4 Section 25. Grievance and complaint registry.
5 (a) A managed care plan shall maintain a register
6 consisting of a written record of all grievances and
7 complaints initiated during the past 3 years. The register
8 shall be maintained in a manner that is reasonably clear and
9 accessible to the Director.
10 (b) The Department shall maintain records concerning the
11 complaints filed against managed care plans with the
12 Department and shall require managed care plans to annually
13 report complaints made to and resolutions by managed care
14 plans in a manner determined by rule. The Department shall
15 make a summary of all data collected available upon request
16 and publish the summary on the World Wide Web.
17 (c) The Department shall maintain records on the number
18 of complaints filed against each managed care plan.
19 (d) The Department shall maintain records classifying
20 each complaint by whether the complaint was filed by:
21 (1) a consumer or enrollee;
22 (2) a physician or health care provider; or
23 (3) any other individual.
24 (e) The Department shall maintain records classifying
25 each complaint according to the nature of the complaint as it
26 pertains to a specific function of the managed care plan.
27 The complaints shall be classified under the following
28 categories:
29 (1) denial of care or treatment;
30 (2) denial of a diagnostic procedure;
31 (3) denial of a referral request;
32 (4) sufficient choice and accessibility of health
33 care providers;
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1 (5) underwriting;
2 (6) marketing and sales;
3 (7) claims and utilization review;
4 (8) member services;
5 (9) provider relations; and
6 (10) miscellaneous.
7 (f) The Department shall maintain records classifying
8 the disposition of each complaint. The disposition of the
9 complaint shall be classified in one of the following
10 categories:
11 (1) complaint referred to the managed care plan and
12 no further action necessary by the Department;
13 (2) no corrective action deemed necessary by the
14 Department; or
15 (3) corrective action taken by the Department.
16 (g) No Department publication or release of information
17 shall identify any enrollee, physician, health care provider,
18 or individual complainant.
19 Section 30. External independent review.
20 (a) If an enrollee's or enrollee's health care
21 professional's or health care provider's or designee's
22 request for a covered service or claim for a covered service
23 is denied under the grievance review under Section 20 because
24 the service is not viewed as medically necessary including,
25 but not limited to, denial of specific tests or procedures,
26 denial of referral to specialist physicians, denial of
27 hospitalization requests or length of stay requests, the
28 enrollee or enrollee's health care professional or health
29 care provider or designee may initiate an external
30 independent review.
31 The managed care plan shall seek to resolve all external
32 independent reviews in the most expeditious manner and shall
33 make a determination and provide notice no more than 24 hours
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1 after the receipt of all necessary information when a delay
2 would significantly increase the risk to an enrollee's health
3 or when extended health care services, procedures, or
4 treatments for an enrollee undergoing a course of treatment
5 prescribed by a health care provider are at issue.
6 (b) Within 30 days after the enrollee receives written
7 notice of such an adverse decision, if the enrollee decides
8 to initiate an external independent review, the enrollee
9 shall send to the managed care plan a written request for an
10 external independent review, including any material
11 justification or documentation to support the enrollee's
12 request for the covered service or claim for a covered
13 service.
14 (c) Within 30 days after the managed care plan receives
15 a request for an external independent review from an
16 enrollee, the managed care plan shall:
17 (1) provide a mechanism for jointly selecting an
18 external independent reviewer by the enrollee, primary
19 care physician, and managed care plan; and
20 (2) forward to the independent reviewer all medical
21 records and supporting documentation pertaining to the
22 case, a summary description of the applicable issues
23 including a statement of the managed care plan's
24 decision, and the criteria used and the medical or
25 clinical reasons for that decision.
26 (d) Within 5 days of receipt of all necessary
27 information, the independent reviewer or reviewers shall
28 evaluate and analyze the case and render a decision that is
29 based on whether or not the service or claim for the service
30 is medically necessary. The decision by the independent
31 reviewer or reviewers is final.
32 (e) Pursuant to subsection (c) of this Section, an
33 external independent reviewer shall:
34 (1) have no direct financial interest in or
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1 connection to the case;
2 (2) for physician services, be State licensed
3 physicians who are board certified or board eligible by
4 the appropriate American Medical Specialty Board, if
5 applicable, and who are in the same or similar scope of
6 practice as a physician who typically manages the medical
7 condition, procedure, or treatment under review;
8 (3) for other health care professional services, be
9 State licensed health care professionals with the same
10 category of license as the health care professional
11 recommending the services; and
12 (4) have not been informed of the specific identity
13 of the enrollee or the enrollee's treating provider.
14 (f) If an appropriate reviewer pursuant to subsection
15 (e) of this Section for a particular case is not on the list
16 established by the Director, the parties shall choose a
17 reviewer who is mutually acceptable.
18 Section 35. Independent reviewers.
19 (a) From information filed with the Director on or
20 before March 1 of each year, the Director of the Illinois
21 Department of Public Health shall compile a list of external
22 independent reviewers and organizations that represent
23 external independent reviewers from lists provided by managed
24 care plans and by any State and county public health
25 department and State professional associations that wish to
26 submit a list to the Director. The Director may consult with
27 other persons about the suitability of any reviewer or any
28 potential reviewer. The Director shall annually review the
29 list and add and remove names as appropriate. On or before
30 June 1 of each year, the Director shall publish the list in
31 the Illinois Register.
32 (b) The managed care plan shall be solely responsible
33 for paying the fees of the external independent reviewer who
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1 is selected to perform the review.
2 (c) An external independent reviewer who acts in good
3 faith shall have immunity from any civil or criminal
4 liability or professional discipline as a result of acts or
5 omissions with respect to any external independent review,
6 unless the acts or omissions constitute wilful and wanton
7 misconduct. For purposes of any proceeding, the good faith
8 of the person participating shall be presumed.
9 (d) The Director's decision to add a name to or remove a
10 name from the list of independent reviewers pursuant to
11 subsection (a) is not subject to administrative appeal or
12 judicial review.
13 Section 40. Health care professional applications and
14 terminations.
15 (a) A managed care plan shall, upon request, make
16 available and disclose to health care professionals written
17 application procedures and minimum qualification requirements
18 that a health care professional must meet in order to be
19 considered by the managed care plan. The managed care plan
20 shall consult with appropriately qualified health care
21 professionals in developing its qualification requirements.
22 (b) A managed care plan may not terminate a contract of
23 employment or refuse to renew a contract on the basis of any
24 action protected under Section 45 of this Act or solely
25 because a health care professional has:
26 (1) filed a complaint against the managed care
27 plan;
28 (2) appealed a decision of the managed care plan
29 including requesting an external independent review; or
30 (3) requested a hearing pursuant to this Section.
31 (c) A managed care plan shall provide to a health care
32 professional, in writing, the reasons for the contract
33 termination or non-renewal.
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1 (d) A managed care plan shall provide an opportunity for
2 a hearing to any health care professional terminated by the
3 managed care plan, or non-renewed if the health care
4 professional has had a contract or contracts with the managed
5 care plan for at least 24 of the past 36 months.
6 (e) After the notice provided pursuant to subsection
7 (c), the health care professional shall have 21 days to
8 request a hearing, and the hearing must be held within 15
9 days after receipt of the request for a hearing. The hearing
10 shall be held before a panel appointed by the managed care
11 plan.
12 The hearing panel shall be composed of 5 individuals, the
13 majority of whom shall be clinical peer reviewers and, to the
14 extent possible, in the same discipline and the same or
15 similar specialty as the health care professional under
16 review.
17 The hearing panel shall render a written decision on the
18 proposed action within 14 business days. The decision shall
19 be one of the following:
20 (1) reinstatement of the health care professional
21 by the managed care plan;
22 (2) provisional reinstatement subject to conditions
23 set forth by the panel; or
24 (3) termination of the health care professional.
25 The decision of the hearing panel shall be final.
26 A decision by the hearing panel to terminate a health
27 care professional shall be effective not less than 15 days
28 after the receipt by the health care professional of the
29 hearing panel's decision.
30 A hearing under this subsection shall provide the health
31 care professional in question with the right to examine
32 pertinent information, to present witnesses, and to ask
33 questions of an authorized representative of the plan.
34 (f) A managed care plan may terminate or decline to
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1 renew a health care professional, without a prior hearing, in
2 cases involving imminent harm to patient care, a
3 determination of intentional falsification of reports to the
4 plan or a final disciplinary action by a state licensing
5 board or other governmental agency that impairs the health
6 care professional's ability to practice. A professional
7 terminated for one of the these reasons shall be given
8 written notice to that effect. Within 21 days after the
9 termination, a health care professional terminated because of
10 imminent harm to patient care or a determination of
11 intentional falsification of reports to the plan shall
12 receive a hearing. The hearing shall be held before a panel
13 appointed by the managed care plan. The panel shall be
14 composed of 5 individuals the majority of whom shall be
15 clinical peer reviewers and, to the extent possible, in the
16 same discipline and the same or similar specialty as the
17 health care professional under review. The hearing panel
18 shall render a decision on the proposed action within 14
19 days. The panel shall issue a written decision either
20 supporting the termination or ordering the health care
21 professional's reinstatement. The decision of the hearing
22 panel shall be final.
23 If the hearing panel upholds the managed care plan's
24 termination of the health care professional under this
25 subsection, the managed care plan shall forward the decision
26 to the appropriate professional disciplinary agency in
27 accordance with subsection (b) of Section 65.
28 Any hearing under this subsection shall provide the
29 health care professional in question with the right to
30 examine pertinent information, to present witnesses, and to
31 ask questions of an authorized representative of the plan.
32 (g) For any hearing under this Section, because the
33 candid and conscientious evaluation of clinical practices is
34 essential to the provision of health care, it is the policy
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1 of this State to encourage peer review by health care
2 professionals. Therefore, no managed care plan and no
3 individual who participates in a hearing or who is a member,
4 agent, or employee of a managed care plan shall be liable for
5 criminal or civil damages or professional discipline as a
6 result of the acts, omissions, decisions, or any other
7 conduct, direct or indirect, associated with a hearing panel,
8 except for wilful and wanton misconduct. Nothing in this
9 Section shall relieve any person, health care provider,
10 health care professional, facility, organization, or
11 corporation from liability for his, her, or its own
12 negligence in the performance of his, her, or its duties or
13 arising from treatment of a patient. The hearing panel
14 information shall not be subject to inspection or disclosure
15 except upon formal written request by an authorized
16 representative of a duly authorized State agency or pursuant
17 to a court order issued in a pending action or proceeding.
18 (h) A managed care plan shall develop and implement
19 policies and procedures to ensure that health care
20 professionals are at least annually informed of information
21 maintained by the managed care plan to evaluate the
22 performance or practice of the health care professional. The
23 managed care plan shall consult with health care
24 professionals in developing methodologies to collect and
25 analyze health care professional data. Managed care plans
26 shall provide the information and data and analysis to health
27 care professionals. The information, data, or analysis shall
28 be provided on at least an annual basis in a format
29 appropriate to the nature and amount of data and the volume
30 and scope of services provided. Any data used to evaluate
31 the performance or practice of a health care professional
32 shall be measured against stated criteria and a comparable
33 group of health care professionals who use similar treatment
34 modalities and serve a comparable patient population. Upon
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1 receipt of the information or data, a health care
2 professional shall be given the opportunity to explain the
3 unique nature of the health care professional's patient
4 population that may have a bearing on the health care
5 professional's data and to work cooperatively with the
6 managed care plan to improve performance.
7 (i) Any contract provision or procedure or informal
8 policy or procedure in violation of this Section violates the
9 public policy of the State of Illinois and is void and
10 unenforceable.
11 Section 45. Prohibitions.
12 (a) No managed care plan or its subcontractors shall by
13 contract, written policy or written procedure, or informal
14 policy or procedure prohibit or restrict any health care
15 professional or provider from disclosing to any enrollee,
16 patient, designated representative or, where appropriate,
17 prospective enrollee, (hereinafter collectively referred to
18 as enrollee) any information that the professional or
19 provider deems appropriate regarding:
20 (1) a condition or a course of treatment with an
21 enrollee including the availability of other therapies,
22 consultations, or tests; or
23 (2) the provisions, terms, or requirements of the
24 managed care plan's products as they relate to the
25 enrollee, where applicable.
26 (b) No managed care plan or its subcontractors shall by
27 contract, written policy or procedure, or informal policy or
28 procedure prohibit or restrict any health care professional
29 or provider from filing a complaint, making a report, or
30 commenting to an appropriate governmental body regarding the
31 policies or practices of the managed care plan that the
32 provider believes may negatively impact upon the quality of,
33 or access to, patient care.
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1 (c) No managed care plan or its subcontractors shall
2 retaliate against a health care professional or health care
3 provider who advocates for appropriate health care services
4 for patients. It is the public policy of the State of
5 Illinois that a health care professional or health care
6 provider be encouraged to advocate for medically appropriate
7 health care services for his or her patients. This Section
8 shall not be construed to prohibit a managed care plan from
9 making a determination not to pay for a particular health
10 care service or to prohibit a medical group, independent
11 practice association, preferred provider organization,
12 foundation, hospital medical staff, hospital governing body
13 or managed care plan from enforcing reasonable peer review or
14 utilization review protocols or determining whether a health
15 care professional or health care provider has complied with
16 those protocols. Nothing in this Section shall be construed
17 to prohibit the governing body of a hospital or the hospital
18 medical staff from taking disciplinary actions against a
19 physician as authorized by law. Nothing in this Section shall
20 be construed to prohibit the Department of Professional
21 Regulation from taking disciplinary actions against a health
22 care professional or provider under the appropriate licensing
23 Act.
24 (d) No managed care plan or its subcontractors by
25 contract, written policy, or procedure shall contain any
26 clause attempting to transfer or transferring to a physician
27 or health care professional or provider by indemnification or
28 otherwise, any civil or professional liability relating to
29 activities, actions, or omissions of the managed care plan or
30 its officers, employees, or agents as opposed to those of the
31 health care provider. A managed care plan shall be
32 responsible for any civil or professional liability relating
33 to activities, actions, or omissions of the plan or its
34 officers, employees, or agents. If a physician or health
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1 care professional or provider performs activities, such as
2 quality assurance or utilization review, on behalf of the
3 plan or its subcontractors, then the physician or health care
4 professional or provider is acting as agent of the plan.
5 Nothing in this Section shall relieve any person, health care
6 provider, health care professional, or facility from
7 liability for his, her, or its own negligence in the
8 performance of his, her, or its duties or arising from
9 treatment of a patient.
10 (e) No contract between a managed care plan or its
11 subcontractors and a health care professional or provider
12 shall contain any incentive plan that includes specific
13 payment made directly, in any form, to a health care
14 professional or provider as an inducement to deny, reduce,
15 limit, or delay specific, medically necessary and appropriate
16 services provided with respect to a specific enrollee or
17 groups of enrollees with similar medical conditions. Nothing
18 in this Section shall be construed to prohibit contracts that
19 contain incentive plans that involve general payments, such
20 as capitation payments or shared-risk arrangements, that are
21 not tied to specific medical decisions involving specific
22 enrollees or groups of enrollees with similar medical
23 conditions. The payments rendered or to be rendered to
24 health care professionals or providers under these
25 arrangements shall be deemed confidential information.
26 (f) No managed care plan or its subcontractors shall by
27 contract, written policy or procedure, or informal policy or
28 procedure permit, allow, or encourage an individual or entity
29 to dispense a different drug in place of the drug or brand of
30 drug ordered or prescribed without the express permission of
31 the person ordering or prescribing, except this prohibition
32 does not prohibit the interchange of different brands of the
33 same generically equivalent drug product, as provided under
34 Section 3.14 of the Illinois Food, Drug and Cosmetic Act.
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1 (g) Any contract provision, written policy or procedure,
2 or informal policy or procedure in violation of this Section
3 violates the public policy of the State of Illinois and is
4 void and unenforceable.
5 Section 50. Network of providers.
6 (a) At least once every 3 years, and upon application
7 for expansion of service area, a managed care plan shall
8 obtain certification from the Director of Public Health that
9 the managed care plan maintains a network of health care
10 professionals, providers, and facilities adequate to meet the
11 comprehensive health needs of its enrollees and to provide an
12 appropriate choice of health care professionals and providers
13 sufficient to provide the services covered under its
14 enrollee's contracts by determining that:
15 (1) there are a sufficient number of geographically
16 accessible participating professionals, providers, and
17 facilities;
18 (2) there are opportunities to select from at least
19 3 primary care physicians pursuant to travel and distance
20 time standards, providing that these standards account
21 for the conditions of accessing physicians in rural
22 areas; and
23 (3) there are sufficient professionals or providers
24 in all covered areas of specialty practice to meet the
25 needs of the enrollment population.
26 (b) The following criteria shall be considered by the
27 Director of Public Health at the time of a review:
28 (1) professional-enrollee and provider-enrollee
29 ratios by specialty;
30 (2) primary care physician-enrollee ratios;
31 (3) safe and adequate staffing of health care
32 professionals or providers in all participating
33 facilities based on:
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1 (A) severity of patient illness and functional
2 capacity;
3 (B) factors affecting the period and quality
4 of patient recovery; and
5 (C) any other factor substantially related to
6 the condition and health care needs of patients;
7 (4) geographic accessibility;
8 (5) the number of grievances filed by enrollees
9 relating to waiting times for appointments,
10 appropriateness of referrals, and other indicators of a
11 managed care plan's capacity;
12 (6) hours of operation;
13 (7) the managed care plan's ability to provide
14 culturally and linguistically competent care to meet the
15 needs of its enrollee population; and
16 (8) the volume of technological and speciality
17 services available to serve the needs of enrollees
18 requiring technologically advanced or specialty care.
19 (c) A managed care plan shall report on an annual basis
20 the number of enrollees and the number of participating
21 professionals and providers in the managed care plan.
22 Section 55. Referral to specialists.
23 (a) All managed care plans that require each enrollee to
24 select a health care provider for any purpose including
25 coordination of care shall allow all enrollees to choose any
26 primary care physician licensed to practice medicine in all
27 its branches or any health care professional participating in
28 the managed care plan for that purpose. The managed care plan
29 shall provide the enrollee with a choice of licensed health
30 care professionals who are accessible and qualified.
31 (b) A managed care plan shall establish a procedure by
32 which an enrollee who has a condition that requires ongoing
33 care from a specialist physician or health care professional
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1 may apply for a standing referral to a specialist physician
2 or health care professional if a referral to a specialist
3 physician or health care professional is required for
4 coverage. The application shall be made to the enrollee's
5 primary care physician. This procedure for a standing
6 referral must specify the necessary criteria and conditions
7 that must be met in order for an enrollee to obtain a
8 standing referral. A standing referral shall be effective for
9 the period necessary to provide the referred services or one
10 year. A primary care physician may renew a standing referral.
11 (c) The enrollee may be required by the managed care
12 plan to select a specialist physician or health care
13 professional who has a referral arrangement with the
14 enrollee's primary care physician or to select a new primary
15 care physician who has a referral arrangement with the
16 specialist physician or health care professional chosen by
17 the enrollee. If a managed care plan requires an enrollee to
18 select a new physician under this subsection, the managed
19 care plan must provide the enrollee with both options
20 provided in this subsection.
21 (d) When the type of specialist physician or other
22 health care provider needed to provide ongoing care for a
23 specific condition does not have a referral arrangement with
24 the enrollee's primary care physician, the primary care
25 physician shall arrange for the enrollee to have access to a
26 qualified health care provider in the plan's provider network
27 who is within a reasonable distance and travel time. When the
28 type of specialist physician or health care professional
29 needed to provide ongoing care for a specific condition is
30 not represented in the managed care plan's network of
31 physicians or health care professionals, the primary care
32 physician shall arrange for the enrollee to have access to a
33 qualified non-participating physician or health care
34 professional within a reasonable distance and travel time at
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1 no additional cost to the enrollee beyond what the enrollee
2 would otherwise pay for services received within the plan's
3 network.
4 (e) The enrollee's primary care physician shall remain
5 responsible for coordinating the care of an enrollee who has
6 received a standing referral to a specialist physician or
7 health care professional. If a secondary referral is
8 necessary, the specialist physician or health care
9 professional shall advise the primary care physician. The
10 primary care physician shall be responsible for making the
11 secondary referral. In addition, the managed care plan shall
12 require the specialist physician or health care professional
13 to provide regular updates to the enrollee's primary care
14 physician.
15 (f) If an enrollee's application for any referral is
16 denied, an enrollee may appeal the decision through the
17 managed care plan's external independent review process in
18 accordance with Section 30 of this Act.
19 Section 60. Transition of services.
20 (a) A managed care plan shall provide for continuity of
21 care for its enrollees as follows:
22 (1) If an enrollee's physician leaves the managed
23 care plan's network of physicians or health care
24 professionals for reasons other than termination of a
25 contract in situations involving imminent harm to a
26 patient or a final disciplinary action by a State
27 licensing board and the physician remains within the
28 managed care plan's service area, the managed care plan
29 shall permit the enrollee to continue an ongoing course
30 of treatment with that physician during a transitional
31 period:
32 (A) of at least 90 days from the date of the notice
33 of physician's termination from the managed care
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1 plan to the enrollee of the physician's
2 disaffiliation from the managed care plan if the
3 enrollee has an ongoing course of treatment; or
4 (B) if the enrollee has entered the second
5 trimester of pregnancy at the time of the
6 physician's disaffiliation, that includes the
7 provision of post-partum care directly related to
8 the delivery.
9 (2) Notwithstanding the provisions in item (1)of
10 this subsection, such care shall be authorized by the
11 managed care plan during the transitional period only if
12 the physician agrees:
13 (A) to continue to accept reimbursement from
14 the managed care plan at the rates applicable prior
15 to the start of the transitional period;
16 (B) to adhere to the managed care plan's
17 quality assurance requirements and to provide to the
18 managed care plan necessary medical information
19 related to such care; and
20 (C) to otherwise adhere to the managed care
21 plan's policies and procedures, including but not
22 limited to procedures regarding referrals and
23 obtaining preauthorizations for treatment.
24 (b) A managed care plan shall provide for continuity of
25 care for new enrollees as follows:
26 (1) If a new enrollee whose physician is not a
27 member of the managed care plan's physician or
28 professional network, but is within the managed care
29 plan's service area, enrolls in the managed care plan,
30 the managed care plan shall permit the enrollee to
31 continue an ongoing course of treatment with the
32 enrollee's current physician during a transitional
33 period:
34 (A) of at least 90 days from the effective date of
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1 enrollment if the enrollee has an ongoing course of
2 treatment; or
3 (B) if the enrollee has entered the second
4 trimester of pregnancy at the effective date of
5 enrollment, that includes the provision of post-partum
6 care directly related to the delivery.
7 (2) If an enrollee elects to continue to receive
8 care from such physician pursuant to item (1) of this
9 subsection, such care shall be authorized by the managed
10 care plan for the transitional period only if the
11 physician agrees:
12 (A) to accept reimbursement from the managed
13 care plan at rates established by the managed care
14 plan; such rates shall be the level of reimbursement
15 applicable to similar physicians within the managed
16 care plan for such services;
17 (B) to adhere to the managed care plan's
18 quality assurance requirements and to provide to the
19 managed care plan necessary medical information
20 related to such care; and
21 (C) to otherwise adhere to the managed care
22 plan's policies and procedures including, but not
23 limited to procedures regarding referrals and
24 obtaining preauthorization for treatment.
25 (c) In no event shall this Section be construed to
26 require a managed care plan to provide coverage for benefits
27 not otherwise covered or to diminish or impair preexisting
28 condition limitations contained in the enrollee's contract.
29 Section 65. Duty to report.
30 (a) A managed care plan shall report to the appropriate
31 professional disciplinary agency, after compliance and in
32 accordance with the provisions of this Section:
33 (1) termination of a health care provider contract
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1 for commission of an act or acts that may directly
2 threaten patient care, and not of an administrative
3 nature, or that a person may be mentally or physically
4 disabled in such a manner as to endanger a patient under
5 that person's care;
6 (2) voluntary or involuntary termination of a
7 contract or employment or other affiliation with the
8 managed care plan to avoid the imposition of disciplinary
9 measures.
10 The managed care plan shall only make the report after it
11 has provided the health care professional with a hearing on
12 the matter. (This hearing shall not impair or limit the
13 managed care plan's ability to terminate the professional.
14 Its purpose is solely to ensure that a sufficient basis
15 exists for making the report.) The hearing shall be held
16 before a panel appointed by the managed care plan. The
17 hearing panel shall be composed of 5 persons appointed by the
18 plan, the majority of whom shall be clinical peer reviewers,
19 to the extent possible, in the same discipline and the same
20 specialty as the health care professional under review. The
21 hearing panel shall determine whether the proposed basis for
22 the report is supported by a preponderance of the evidence.
23 The panel shall render its determination within 14 days. If
24 a majority of the panel finds the proposed basis for the
25 report is supported by a preponderance of the evidence, the
26 managed care plan shall make the required report within 21
27 days.
28 Any hearing under this Section shall provide the health
29 care professional in question with the right to examine
30 pertinent information, to present witnesses, and to ask
31 questions of an authorized representative of the plan.
32 If a hearing has been held pursuant to subsection (f) of
33 Section 40 and the hearing panel sustained a plan's
34 termination of a health care professional, no additional
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1 hearing is required, and the plan shall make the report
2 required under this Section.
3 (b) Reports made pursuant to this Section shall be made
4 in writing to the appropriate professional disciplinary
5 agency. Written reports shall include the name, address,
6 profession, and license number of the individual and a
7 description of the action taken by the managed care plan,
8 including the reason for the action and the date thereof, or
9 the nature of the action or conduct that led to the
10 resignation, termination of contract, or withdrawal, and the
11 date thereof.
12 For any hearing under this Section, because the candid
13 and conscientious evaluation of clinical practices is
14 essential to the provision of health care, it is the policy
15 of this State to encourage peer review by health care
16 professionals. Therefore, no managed care plan and no
17 individual who participates in a hearing or who is a member,
18 agent, or employee of a managed care plan shall be liable for
19 criminal or civil damages or professional discipline as a
20 result of the acts, omissions, decisions, or any other
21 conduct, direct or indirect, associated with a hearing panel,
22 except for wilful and wanton misconduct. Nothing in this
23 Section shall relieve any person, health care provider,
24 health care professional, facility, organization, or
25 corporation from liability for his, her, or its own
26 negligence in the performance of his, her, or its duties or
27 arising from treatment of a patient. The hearing panel
28 information shall not be subject to inspection or disclosure
29 except upon formal written request by an authorized
30 representative of a duly authorized State agency or pursuant
31 to a court order issued in a pending action or proceeding.
32 Section 70. Disclosure of information.
33 (a) A health care professional affiliated with a managed
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1 care plan shall make available, upon request, in written form
2 at his or her office, to his or her patients or prospective
3 patients the following:
4 (1) information related to the health care
5 professional's educational background, experience,
6 training, specialty and board certification, if
7 applicable, number of years in practice, and hospitals
8 where he or she has privileges;
9 (2) information regarding the health care
10 professional's participation in continuing education
11 programs and compliance with any licensure,
12 certification, or registration requirements, if
13 applicable; and
14 (3) the location of the health care professional's
15 primary practice setting and the identification of any
16 translation services available.
17 Section 75. Utilization review program registration.
18 (a) No person may conduct a utilization review program
19 in this State unless once every 2 years the person registers
20 the utilization review program with the Department and
21 certifies compliance with all of the Health Utilization
22 Management Standards of the American Accreditation Healthcare
23 Commission (URAC) or submits evidence of accreditation by the
24 American Accreditation Healthcare Commission (URAC) for its
25 Health Utilization Management Standards.
26 (b) The Director, in consultation with the Director of
27 Public Health, may certify alternative utilization review
28 standards of national accreditation organizations or entities
29 in order for plans to comply with this Section. Any
30 alternative utilization review standards shall meet or exceed
31 those standards required under subsection (a). In addition,
32 the Director, in consultation with the Director of Public
33 Health, may adopt additional utilization review requirements
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1 by rule.
2 (c) The provisions of this Section do not apply to:
3 (1) persons providing utilization review program
4 services only to the federal government;
5 (2) self-insured managed care plans preempted from
6 State regulation under the federal Employee Retirement
7 Income Security Act of 1974, however, this Section does
8 apply to persons conducting a utilization review program
9 on behalf of these managed care plans; and
10 (3) hospitals and medical groups performing
11 utilization review activities for internal purposes
12 unless the utilization review program is conducted for
13 another person.
14 Nothing in this Act prohibits a managed care plan or
15 other entity from contractually requiring an entity
16 designated in item (3) of this subsection to adhere to the
17 utilization review program requirements of this Act.
18 (d) This registration shall include submission of all of
19 the following information regarding utilization review
20 program activities:
21 (1) The name, address, and telephone of the
22 utilization review programs.
23 (2) The organization and governing structure of the
24 utilization review programs.
25 (3) The number of lives for which utilization
26 review is conducted by each utilization review program.
27 (4) Hours of operation of each utilization review
28 program.
29 (5) Description of the grievance process for each
30 utilization review program.
31 (6) Number of covered lives for which utilization
32 review was conducted for the previous calendar year for
33 each utilization review program.
34 (7) Written policies and procedures for protecting
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1 confidential information according to applicable State
2 and federal laws for each utilization review program.
3 (e) The Department shall investigate utilization review
4 program compliance with the requirements of this Section. If
5 the Department finds that a utilization review program is not
6 in compliance with this Section, the Department shall issue a
7 corrective action plan and allow a reasonable amount of time
8 for compliance with the plan. If the utilization review
9 program does not come into compliance, the Department may
10 issue a cease and desist order. Before issuing a cease and
11 desist order under this Section, the Department shall provide
12 the utilization review program with a written notice of the
13 reasons for the order and allow a reasonable amount of time
14 to supply additional information demonstrating compliance
15 with requirements of this Section and to request a hearing.
16 The hearing notice shall be sent by certified mail, return
17 receipt requested, and the hearing shall be conducted in
18 accordance with the Illinois Administrative Procedure Act.
19 (f) A utilization review program subject to a corrective
20 action may continue to conduct business until a final
21 decision has been issued by the Department.
22 Section 80. Appeal of adverse determinations by
23 utilization review programs.
24 (a) An enrollee, the enrollee's designee, and, in
25 connection with retrospective adverse determinations, the
26 enrollee's health care provider may appeal an adverse
27 determination rendered by a utilization review program
28 pursuant to Sections 15, 20, and 30.
29 (b) A utilization review program shall establish
30 mechanisms that facilitate resolution of the appeal
31 including, but not limited to, the sharing of information
32 from the enrollee's health care provider and the utilization
33 review program by telephonic means or by facsimile. The
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1 utilization review program shall provide reasonable access to
2 its clinical peer reviewer in a prompt manner.
3 (c) Appeals shall be reviewed by a clinical peer
4 reviewer other than the clinical peer reviewer who rendered
5 the adverse determination.
6 Section 85. Required and prohibited practices.
7 (a) A utilization review program shall have written
8 procedures for assuring that patient-specific information
9 obtained during the process of utilization review will be:
10 (1) kept confidential in accordance with applicable
11 State and federal laws; and
12 (2) shared only with the enrollee, the enrollee's
13 designee, the enrollee's health care provider, and those
14 who are authorized by law to receive the information.
15 (b) Summary data shall not be considered confidential
16 if it does not provide information to allow identification of
17 individual patients.
18 (c) Any health care professional who makes
19 determinations regarding the medical necessity of health care
20 services during the course of utilization review shall be
21 appropriately licensed or registered.
22 (d) A utilization review program shall not, with respect
23 to utilization review activities, permit or provide
24 compensation or anything of value to its employees, agents,
25 or contractors based on:
26 (1) either a percentage of the amount by which a
27 claim is reduced for payment or the number of claims or
28 the cost of services for which the person has denied
29 authorization or payment; or
30 (2) any other method that encourages the rendering
31 of an adverse determination.
32 (e) If a health care service has been specifically
33 pre-authorized or approved for an enrollee by a utilization
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1 review program, a utilization review program shall not,
2 pursuant to retrospective review, revise or modify the
3 specific standards, criteria, or procedures used for the
4 utilization review for procedures, treatment, and services
5 delivered to the enrollee during the same course of
6 treatment.
7 (f) Utilization review shall not be conducted more
8 frequently than is reasonably required to assess whether the
9 health care services under review are medically necessary.
10 The Department may promulgate rules governing the frequency
11 of utilization reviews for managed care plans of differing
12 size and geographic location.
13 (g) When making prospective, concurrent, and
14 retrospective determinations, utilization review programs
15 shall collect only information that is necessary to make the
16 determination and shall not routinely require health care
17 providers to numerically code diagnoses or procedures to be
18 considered for certification, unless required under State or
19 federal Medicare or Medicaid rules or regulations, or
20 routinely request copies of medical records of all patients
21 reviewed. During prospective or concurrent review, copies of
22 medical records shall only be required when necessary to
23 verify that the health care services subject to the review
24 are medically necessary. In these cases, only the necessary
25 or relevant sections of the medical record shall be required.
26 A utilization review program may request copies of partial or
27 complete medical records retrospectively.
28 (h) In no event shall information be obtained from
29 health care providers for the use of the utilization review
30 program by persons other than health care professionals,
31 medical record technologists, or administrative personnel who
32 have received appropriate training.
33 (i) The utilization review program shall not undertake
34 utilization review at the site of the provision of health
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1 care services unless the utilization review program staff
2 person:
3 (1) identifies himself or herself by name and the
4 name of his or her organization, including displaying
5 photographic identification that includes the name of the
6 utilization review program and staff person and clearly
7 identifies the individual as representative of the
8 utilization review program;
9 (2) whenever possible, schedules review at least
10 one business day in advance with the appropriate health
11 care provider;
12 (3) if requested by a health care provider, assures
13 that the on-site review staff register with the
14 appropriate contact person, if available, prior to
15 requesting any clinical information or assistance from
16 the health care provider; and
17 (4) obtains consent from the enrollee or the
18 enrollee's designee before interviewing the patient's
19 family or observing any health care service being
20 provided to the enrollee.
21 This subsection does not apply to health care
22 professionals engaged in providing care, case management, or
23 making on-site discharge decisions.
24 (j) A utilization review program shall not base an
25 adverse determination on a refusal to consent to observing
26 any health care service.
27 (k) A utilization review program shall not base an
28 adverse determination on lack of reasonable access to a
29 health care provider's medical or treatment records unless
30 the utilization review program has provided reasonable notice
31 to both the enrollee or the enrollee's designee and the
32 enrollee's health care provider and has complied with all
33 provisions of subsection (i) of this Section. The Department
34 may promulgate rules defining reasonable notice and the time
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1 period within which medical and treatment records must be
2 turned over.
3 (l) Neither the utilization review program nor the
4 entity for which the program provides utilization review
5 shall take any action with respect to a patient or a health
6 care provider that is intended to penalize the enrollee, the
7 enrollee's designee, or the enrollee's health care provider
8 for, or to discourage the enrollee, the enrollee's designee,
9 or the enrollee's health care provider from, undertaking an
10 appeal, dispute resolution, or judicial review of an adverse
11 determination.
12 (m) In no event shall an enrollee, an enrollee's
13 designee, an enrollee's health care provider, any other
14 health care provider, or any other person or entity be
15 required to inform or contact the utilization review program
16 prior to the provision of emergency services as defined in
17 this Act.
18 (n) A health care professional providing health care
19 services to an enrollee shall be prohibited from serving as
20 the clinical peer reviewer for that enrollee in connection
21 with the health care services being provided to the enrollee.
22 Section 90. Annual consumer satisfaction survey. The
23 Director shall develop and administer a survey of persons who
24 have been enrolled in a managed care plan in the most recent
25 calendar year to collect information on relative plan
26 performance including, but not limited to, arrangement for
27 delivery of care. This survey shall:
28 (1) be administered annually by the Director, or by
29 an independent agency or organization selected by the
30 Director;
31 (2) be administered to a scientifically selected
32 representative sample of current enrollees from each
33 plan, as well as persons who have disenrolled from a plan
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1 in the last calendar year; and
2 (3) emphasize the collection of information from
3 persons who have used the managed care plan to a
4 significant degree, as defined by rule.
5 Selected data from the annual survey shall be made
6 available to current and prospective enrollees as part of a
7 consumer guidebook or managed care report card of health plan
8 performance, which the Department shall develop and publish.
9 The elements to be included in the guidebook shall be
10 reassessed on an ongoing basis by the Department. The
11 consumer guidebook shall be updated at least annually.
12 Section 95. Managed care patient rights. In addition to
13 all other requirements of this Act, a managed care plan shall
14 ensure that an enrollee has the following rights:
15 (1) A patient has the right to care consistent with
16 professional standards of practice to assure quality nursing
17 and medical practices, to choose the participating physician
18 responsible for coordinating his or her care, to receive
19 information concerning his or her condition and proposed
20 treatment, to refuse any treatment to the extent permitted by
21 law, and to privacy and confidentiality of records except as
22 otherwise provided by law.
23 (2) A patient has the right, regardless of source of
24 payment, to examine and to receive a reasonable explanation
25 of his or her total bill for health care services rendered by
26 his or her physician or other health care provider, including
27 the itemized charges for specific health care services
28 received. A physician or other health care provider shall be
29 responsible only for a reasonable explanation of these
30 specific health care services provided by the health care
31 provider.
32 (3) A patient has the right to privacy and
33 confidentiality in health care. This right may be expressly
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1 waived in writing by the patient or the patient's guardian.
2 Section 100. Health care entity liability.
3 (a) In this Section:
4 "Appropriate and medically necessary" means the standard
5 for health care services as determined by physicians and
6 health care providers in accordance with the prevailing
7 practices and standards of the medical profession and
8 community.
9 "Enrollee" means an individual who is enrolled in a
10 health care plan, including covered dependents.
11 "Health care plan" means any plan whereby any person
12 undertakes to provide, arrange for, pay for, or reimburse any
13 part of the cost of any health care services.
14 "Health care provider" means a person or entity as
15 defined in Section 2-1003 of the Code of Civil Procedure.
16 "Health care treatment decision" means a determination
17 made when medical services are actually provided by the
18 health care plan and a decision that affects the quality of
19 the diagnosis, care, or treatment provided to the plan's
20 insureds or enrollees.
21 "Health insurance carrier" means an authorized insurance
22 company that issues policies of accident and health insurance
23 under the Illinois Insurance Code.
24 "Health maintenance organization" means an organization
25 licensed under the Health Maintenance Organization Act.
26 "Managed care entity" means any entity that delivers,
27 administers, or assumes risk for health care services with
28 systems or techniques to control or influence the quality,
29 accessibility, utilization, or costs and prices of those
30 services to a defined enrollee population, but does not
31 include an employer purchasing coverage or acting on behalf
32 of its employees or the employees of one or more subsidiaries
33 or affiliated corporations of the employer.
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1 "Physician" means: (1) an individual licensed to practice
2 medicine in this State; (2) a professional association,
3 professional service corporation, partnership, medical
4 corporation, or limited liability company, entitled to
5 lawfully engage in the practice of medicine; or (3) another
6 person wholly owned by physicians.
7 "Ordinary care" means, in the case of a health insurance
8 carrier, health maintenance organization, or managed care
9 entity, that degree of care that a health insurance carrier,
10 health maintenance organization, or managed care entity of
11 ordinary prudence would use under the same or similar
12 circumstances. In the case of a person who is an employee,
13 agent, ostensible agent, or representative of a health
14 insurance carrier, health maintenance organization, or
15 managed care entity, "ordinary care" means that degree of
16 care that a person of ordinary prudence in the same
17 profession, specialty, or area of practice as such person
18 would use in the same or similar circumstances.
19 (b) A health insurance carrier, health maintenance
20 organization, or other managed care entity for a health care
21 plan has the duty to exercise ordinary care when making
22 health care treatment decisions and is liable for damages for
23 harm to an insured or enrollee proximately caused by its
24 failure to exercise such ordinary care.
25 (c) A health insurance carrier, health maintenance
26 organization, or other managed care entity for a health care
27 plan is also liable for damages for harm to an insured or
28 enrollee proximately caused by the health care treatment
29 decisions made by its:
30 (1) employees;
31 (2) agents;
32 (3) ostensible agents; or
33 (4) representatives who are acting on its behalf
34 and over whom it has the right to exercise influence or
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1 control or has actually exercised influence or control
2 that results in the failure to exercise ordinary care.
3 (d) The standards in subsections (b) and (c) create no
4 obligation on the part of the health insurance carrier,
5 health maintenance organization, or other managed care entity
6 to provide to an insured or enrollee treatment that is not
7 covered by the health care plan of the entity.
8 (e) A health insurance carrier, health maintenance
9 organization, or managed care entity may not remove a
10 physician or health care provider from its plan or refuse to
11 renew the physician or health care provider with its plan for
12 advocating on behalf of an enrollee for appropriate and
13 medically necessary health care for the enrollee.
14 (f) A health insurance carrier, health maintenance
15 organization, or other managed care entity may not enter into
16 a contract with a physician, hospital, or other health care
17 provider or pharmaceutical company which includes an
18 indemnification or hold harmless clause for the acts or
19 conduct of the health insurance carrier, health maintenance
20 organization, or other managed care entity. Any such
21 indemnification or hold harmless clause in an existing
22 contract is hereby declared void.
23 (g) Nothing in any law of this State prohibiting a
24 health insurance carrier, health maintenance organization, or
25 other managed care entity from practicing medicine or being
26 licensed to practice medicine may be asserted as a defense by
27 the health insurance carrier, health maintenance
28 organization, or other managed care entity in an action
29 brought against it pursuant to this Section or any other law.
30 (h) In an action against a health insurance carrier,
31 health maintenance organization, or managed care entity, a
32 finding that a physician or other health care provider is an
33 employee, agent, ostensible agent, or representative of the
34 health insurance carrier, health maintenance organization, or
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1 managed care entity shall not be based solely on proof that
2 the person's name appears in a listing of approved physicians
3 or health care providers made available to insureds or
4 enrollees under a health care plan.
5 (i) This Section does not apply to workers' compensation
6 insurance coverage subject to the Workers' Compensation Act.
7 (j) This Section does not apply to actions seeking only
8 a review of an adverse utilization review determination.
9 This Section applies only to causes of action that accrue on
10 or after the effective date of this Act. An insured or
11 enrollee seeking damages under this Section has the right and
12 duty to submit the claim to arbitration in accordance with
13 the Uniform Arbitration Act. No agreement between the
14 parties to submit the claim to arbitration is necessary. A
15 health insurance carrier, health maintenance organization, or
16 managed care entity shall have no liability under this
17 Section unless the claim is first submitted to arbitration in
18 accordance with the Uniform Arbitration Act. The award in
19 matters arbitrated pursuant to this Section shall be made
20 within 30 days after notification of the arbitration is
21 provided to all parties.
22 (k) The determination of whether a procedure or
23 treatment is medically necessary must be made by a physician.
24 (l) If the physician determines that a procedure or
25 treatment is medically necessary, the health care plan must
26 pay for the procedure or treatment.
27 (m) This Section does not apply to licensed insurance
28 agents.
29 Section 105. Waiver. Any agreement that purports to
30 waive, limit, disclaim or in any way diminish the rights set
31 forth in this Act is void as contrary to public policy.
32 Section 110. Administration of Act.
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1 (a) The Department shall administer this Act.
2 (b) All managed care plans and utilization review
3 programs providing or reviewing services in Illinois shall
4 annually certify compliance with this Act and rules adopted
5 under this Act to the Department in addition to any other
6 licensure required by law. The Director shall establish by
7 rule a process for this certification including fees to cover
8 the costs associated with implementing this Act. All fees
9 and fines assessed under this Act shall be deposited in the
10 Managed Care Reform Fund, a special fund hereby created in
11 the State treasury. Moneys in the Fund shall be used by the
12 Department only to enforce and administer this Act. The
13 certification requirements of this Act shall be incorporated
14 into program requirements of the Department of Public Aid and
15 Department of Human Services and no further certification
16 under this Act is required.
17 (c) The Director shall take enforcement action under
18 this Act including, but not limited to, the assessment of
19 civil fines and injunctive relief for any failure to comply
20 with this Act or any violation of the Act or rules by a
21 managed care plan or any utilization review program.
22 (d) The Department shall have the authority to impose
23 fines on any managed care plan or any utilization review
24 program. The Department shall adopt rules pursuant to this
25 Act that establish a system of fines related to the type and
26 level of violation or repeat violation, including but not
27 limited to:
28 (1) A fine not exceeding $10,000 for a violation
29 that created a condition or occurrence presenting a
30 substantial probability that death or serious harm to an
31 individual will or did result therefrom; and
32 (2) A fine not exceeding $5,000 for a violation
33 that creates or created a condition or occurrence that
34 threatens the health, safety, or welfare of an
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1 individual.
2 Each day a violation continues shall constitute a
3 separate offense. These rules shall include an opportunity
4 for a hearing in accordance with the Illinois Administrative
5 Procedure Act. All final decisions of the Department shall
6 be reviewable under the Administrative Review Law.
7 (e) Notwithstanding the existence or pursuit of any
8 other remedy, the Director may, through the Attorney General,
9 seek an injunction to restrain or prevent any person or
10 entity from functioning or operating in violation of this Act
11 or rule.
12 Section 115. Emergency services prior to stabilization.
13 (a) A managed care plan subject to this Act that
14 provides or that is required by law to provide coverage for
15 emergency services shall provide coverage such that payment
16 under this coverage is not dependent upon whether the
17 services are performed by a plan or non-plan physician or
18 health care provider and without regard to prior
19 authorization. This coverage shall be at the same benefit
20 level as if the services or treatment had been rendered by
21 the managed care plan physician or health care provider.
22 (b) Prior authorization or approval by the plan shall
23 not be required for emergency services.
24 (c) Coverage and payment shall not be retrospectively
25 denied, with the following exceptions:
26 (1) upon reasonable determination that the
27 emergency services claimed were never performed;
28 (2) upon reasonable determination that the
29 emergency evaluation and treatment were rendered to an
30 enrollee who sought emergency services and whose
31 circumstance did not meet the definition of emergency
32 medical condition;
33 (3) upon determination that the patient receiving
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1 such services was not an enrollee of the health insurance
2 plan; or
3 (4) upon material misrepresentation by the enrollee
4 or health care provider; "material" means a fact or
5 situation that is not merely technical in nature and
6 results or could result in a substantial change in the
7 situation.
8 (d) When an enrollee presents to a hospital seeking
9 emergency services, the determination as to whether the need
10 for those services exists shall be made for purposes of
11 treatment by a physician licensed to practice medicine in all
12 its branches or, to the extent permitted by applicable law,
13 by other appropriately licensed personnel under the
14 supervision of or in collaboration with a physician licensed
15 to practice medicine in all its branches. The physician or
16 other appropriate personnel shall indicate in the patient's
17 chart the results of the emergency medical screening
18 examination. The managed care plan shall compensate the
19 health care professional or provider for the emergency
20 medical screening examination.
21 (e) The appropriate use of the 911 emergency telephone
22 system or its local equivalent shall not be discouraged or
23 penalized by the health insurance plan when an emergency
24 medical condition exists. This provision shall not imply that
25 the use of 911 or its local equivalent is a factor in
26 determining the existence of an emergency medical condition.
27 (f) Nothing in this Section alters the prohibition on
28 billing enrollees contained in the Health Maintenance
29 Organization Act. Nothing in this Section shall prohibit the
30 imposition of deductibles, co-payments, and co-insurance.
31 Section 120. Post-stabilization medical services.
32 (a) If prior authorization for covered post-stabilization
33 services is required by the managed care plan, the plan shall
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1 provide access 24 hours a day, 7 days a week to persons
2 designated by the plan to make such determinations.
3 (b) The treating physician or health care provider shall
4 contact the managed care plan or delegated physician or
5 health care provider as designated on the enrollee's health
6 insurance card to obtain authorization, denial, or
7 arrangements for an alternate plan of treatment or transfer
8 of the enrollee.
9 (c) The treating physician licensed to practice medicine
10 in all its branches or health care provider shall document in
11 the enrollee's medical record the enrollee's presenting
12 symptoms; emergency medical condition; and time, phone number
13 dialed, and result of the communication for request for
14 authorization of post stabilization medical services. The
15 managed care plan shall provide reimbursement for covered
16 post-stabilization medical services if:
17 (1) authorization to render them is received from
18 the managed care plan or its delegated physician or
19 health care provider; or
20 (2) after 2 documented good faith efforts, the
21 treating physician or health care provider has attempted
22 to contact the enrollee's managed care plan or its
23 delegated physician or health care provider, as
24 designated on the enrollee's health insurance card, for
25 prior authorization of post-stabilization medical
26 services and neither the plan nor designated persons were
27 accessible or the authorization was not denied within 60
28 minutes of the request. "Two documented good faith
29 efforts" means the physician or health care provider has
30 called the telephone number on the enrollee's health
31 insurance card or other available number either 2 times
32 or one time and made an additional call to any referral
33 number provided. "Good faith" means honesty of purpose,
34 freedom from intention to defraud, and being faithful to
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1 one's duty or obligation. For the purpose of this Act,
2 good faith shall be presumed.
3 (d) After rendering any post-stabilization medical
4 services, the treating physician or health care provider
5 shall continue to make every reasonable effort to contact the
6 managed care plan or its delegated physician or health care
7 provider regarding authorization, denial, or arrangements for
8 an alternate plan of treatment or transfer of the enrollee
9 until the treating physician or health care provider receives
10 instructions from the managed care plan or delegated
11 physician or health care provider for continued care or the
12 care is transferred to another physician or health care
13 provider or the patient is discharged.
14 (e) Payment for covered post-stabilization services may
15 be denied:
16 (1) if the treating physician or health care
17 provider does not meet the conditions outlined in
18 subsection (c);
19 (2) upon determination that the post-stabilization
20 services claimed were not performed;
21 (3) upon determination that the post-stabilization
22 services rendered were contrary to the instructions of
23 the managed care plan or its delegated physician or
24 health care provider if contact was made between those
25 parties prior to the service being rendered;
26 (4) upon determination that the patient receiving
27 such services was not an enrollee of the managed care
28 plan; or
29 (5) upon material misrepresentation by the enrollee
30 or health care provider; "material" means a fact or
31 situation that is not merely technical in nature and
32 results or could result in a substantial change in the
33 situation.
34 (f) Coverage and payment for post-stabilization medical
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1 services for which prior authorization or deemed approval is
2 received shall not be retrospectively denied.
3 (g) Nothing in this Section prohibits a managed care
4 plan from delegating tasks associated with the
5 responsibilities enumerated in this Section to the managed
6 care plan's contracted health care providers or another
7 entity. However, the ultimate responsibility for coverage
8 and payment decisions may not be delegated.
9 (h) Nothing in this Section shall prohibit the
10 imposition of deductibles, co-payments, and co-insurance.
11 Section 125. Prescription drugs. A managed care plan
12 that provides coverage for prescribed drugs approved by the
13 federal Food and Drug Administration shall not exclude
14 coverage of any drug on the basis that the drug has been
15 prescribed for the treatment of a particular indication for
16 which the drug has not been approved by the federal Food and
17 Drug Administration. The drug, however, must be approved by
18 the federal Food and Drug Administration and must be
19 recognized for the treatment of that particular indication
20 for which the drug has been prescribed in any one of the
21 following established reference compendia:
22 (1) the American Hospital Formulary Service Drug
23 Information;
24 (2) the United States Pharmacopoeia Drug
25 Information; or
26 (3) if not recognized by the authorities in item
27 (1) or (2), recommended for that particular indication in
28 formal clinical studies, the results of which have been
29 published in at least 2 peer reviewed professional
30 medical journals published in the United States or Great
31 Britain.
32 Any coverage required by this Section shall also include
33 those medically necessary services associated with the
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1 administration of a drug.
2 Despite the provisions of this Section, coverage shall
3 not be required for any experimental or investigational drugs
4 or any drug that the federal Food and Drug Administration has
5 determined to be contraindicated for treatment of the
6 specific indication for which the drug has been prescribed.
7 Nothing in this Section shall be construed, expressly or by
8 implication, to create, impair, alter, limit, notify,
9 enlarge, abrogate, or prohibit reimbursement for drugs used
10 in the treatment of any other disease or condition.
11 Section 130. Applicability and scope. This Act applies
12 to policies and contracts amended, delivered, issued, or
13 renewed on or after the effective date of this Act. This Act
14 does not diminish a managed care plan's duties and
15 responsibilities under other federal or State law or rules
16 promulgated thereunder.
17 Section 135. Effect on benefits under Workers'
18 Compensation Act and Workers' Occupational Diseases Act.
19 Nothing in this Act shall be construed to expand, modify, or
20 restrict the health care benefits provided to employees under
21 the Workers' Compensation Act and Workers' Occupational
22 Diseases Act.
23 Section 140. Conflicts with federal law. When health
24 care services are provided by a managed care plan subject to
25 this Act to a person who is a recipient of medical assistance
26 under Article V of the Illinois Public Aid Code, the rights,
27 benefits, requirements, and procedures available or
28 authorized under this Act shall not apply to the extent that
29 there are provisions of federal law that conflict. In the
30 event of a conflict, federal law shall prevail.
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1 Section 145. Severability. The provisions of this Act
2 are severable under Section 1.31 of the Statute on Statutes.
3 Section 150. The State Employees Group Insurance Act of
4 1971 is amended by adding Section 6.12 as follows:
5 (5 ILCS 375/6.12 new)
6 Sec. 6.12. Managed Care Reform Act. The program of
7 health benefits is subject to the provisions of the Managed
8 Care Reform Act.
9 Section 155. The Civil Administrative Code of Illinois
10 is amended by adding Sections 56.3 and 56.4 as follows:
11 (20 ILCS 1405/56.3 new)
12 Sec. 56.3. Office of Consumer Health Insurance.
13 (a) The Director of Insurance shall establish the Office
14 of Consumer Health Insurance within the Department of
15 Insurance to provide assistance, advocacy, and information to
16 all health care consumers within the State. The staff
17 responsible shall have direct line reporting responsibility
18 to the Director. Within the appropriation allocated, the
19 office shall provide information and assistance to all health
20 care consumers by:
21 (1) assisting consumers in understanding health
22 insurance marketing materials and the coverage provisions
23 of individual plans including, but not limited to,
24 advocacy for consumers before plans and governmental and
25 nongovernmental agencies;
26 (2) educating enrollees about their rights within
27 individual plans;
28 (3) assisting enrollees in filing formal grievances
29 and appeals;
30 (4) investigating enrollee complaints;
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1 (5) establishing and operating an 800 telephone
2 line to handle consumer inquiries;
3 (6) making information available in languages other
4 than English that are spoken as a primary language by a
5 significant portion of the State's population, as
6 determined by the Department;
7 (7) analyzing, commenting on, monitoring, and
8 making publicly available reports on the development and
9 implementation of federal, State and local laws,
10 regulations, and other governmental policies and actions
11 that pertain to the adequacy of managed care plans,
12 facilities, and services in the State;
13 (8) filing an annual report with the Director and
14 the General Assembly, which shall include recommendations
15 for improvement to the regulation of health insurance
16 plans; and
17 (9) performing all duties assigned to the Office by
18 the Director.
19 (b) Beginning March 1, 2000, the Office shall report, on
20 at least a quarterly basis, any patterns identified from the
21 consumer complaints addressed by the office to the Director
22 and the Governor. By January 1, 2001, and each January 1
23 thereafter, the Director shall make an annual written report
24 to the General Assembly regarding activities of the Office,
25 including recommendations on improving health care consumer
26 assistance and complaint resolution processes.
27 (c) Nothing in this Section shall be interpreted to
28 authorize access to or disclosure of individual patient or
29 health professional or provider records.
30 (20 ILCS 1405/56.4 new)
31 Sec. 56.4. Retaliation. A managed care plan or health
32 care provider may not retaliate or take adverse action
33 against an enrollee or patient who, in good faith, makes a
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1 complaint against a managed care plan, health plan company,
2 or health care provider.
3 Section 160. The State Finance Act is amended by adding
4 Section 5.490 as follows:
5 (30 ILCS 105/5.490 new)
6 Sec. 5.490. The Managed Care Reform Fund.
7 Section 165. The State Mandates Act is amended by adding
8 Section 8.23 as follows:
9 (30 ILCS 805/8.23 new)
10 Sec. 8.23. Exempt mandate. Notwithstanding Sections 6
11 and 8 of this Act, no reimbursement by the State is required
12 for the implementation of any mandate created by this
13 amendatory Act of 1999.
14 Section 170. The Counties Code is amended by adding
15 Section 5-1069.8 as follows:
16 (55 ILCS 5/5-1069.8 new)
17 Sec. 5-1069.8. Managed Care Reform Act. All counties,
18 including home rule counties, are subject to the provisions
19 of the Managed Care Reform Act. The requirement under this
20 Section that health care benefits provided by counties comply
21 with the Managed Care Reform Act is an exclusive power and
22 function of the State and is a denial and limitation of home
23 rule county powers under Article VII, Section 6, subsection
24 (h) of the Illinois Constitution.
25 Section 175. The Illinois Municipal Code is amended by
26 adding 10-4-2.8 as follows:
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1 (65 ILCS 5/10-4-2.8 new)
2 Sec. 10-4-2.8. Managed Care Reform Act. The corporate
3 authorities of all municipalities are subject to the
4 provisions of the Managed Care Reform Act. The requirement
5 under this Section that health care benefits provided by
6 municipalities comply with the Managed Care Reform Act is an
7 exclusive power and function of the State and is a denial and
8 limitation of home rule municipality powers under Article
9 VII, Section 6, subsection (h) of the Illinois Constitution.
10 Section 180. The School Code is amended by adding
11 Section 10-22.3g as follows:
12 (105 ILCS 5/10-22.3g new)
13 Sec. 10-22.3g. Managed Care Reform Act. Insurance
14 protection and benefits for employees are subject to the
15 Managed Care Reform Act.
16 Section 185. The Illinois Insurance Code is amended by
17 changing Section 370g and adding Sections 155.36, 370s, and
18 511.118 as follows:
19 (215 ILCS 5/155.36 new)
20 Sec. 155.36. Managed Care Reform Act. Insurance
21 companies that transact the kinds of insurance authorized
22 under Class 1(b) or Class 2(a) of Section 4 of this Code
23 shall comply with Sections 25 and 75 and the definition of
24 the term "emergency medical condition" in Section 5 of the
25 Managed Care Reform Act.
26 (215 ILCS 5/370g) (from Ch. 73, par. 982g)
27 Sec. 370g. Definitions. As used in this Article, the
28 following definitions apply:
29 (a) "Health care services" means health care services or
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1 products rendered or sold by a provider within the scope of
2 the provider's license or legal authorization. The term
3 includes, but is not limited to, hospital, medical, surgical,
4 dental, vision and pharmaceutical services or products.
5 (b) "Insurer" means an insurance company or a health
6 service corporation authorized in this State to issue
7 policies or subscriber contracts which reimburse for expenses
8 of health care services.
9 (c) "Insured" means an individual entitled to
10 reimbursement for expenses of health care services under a
11 policy or subscriber contract issued or administered by an
12 insurer.
13 (d) "Provider" means an individual or entity duly
14 licensed or legally authorized to provide health care
15 services.
16 (e) "Noninstitutional provider" means any person
17 licensed under the Medical Practice Act of 1987, as now or
18 hereafter amended.
19 (f) "Beneficiary" means an individual entitled to
20 reimbursement for expenses of or the discount of provider
21 fees for health care services under a program where the
22 beneficiary has an incentive to utilize the services of a
23 provider which has entered into an agreement or arrangement
24 with an administrator.
25 (g) "Administrator" means any person, partnership or
26 corporation, other than an insurer or health maintenance
27 organization holding a certificate of authority under the
28 "Health Maintenance Organization Act", as now or hereafter
29 amended, that arranges, contracts with, or administers
30 contracts with a provider whereby beneficiaries are provided
31 an incentive to use the services of such provider.
32 (h) "Emergency medical condition" means a medical
33 condition manifesting itself by acute symptoms of sufficient
34 severity (including but not limited to severe pain) such that
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1 a prudent layperson, who possesses an average knowledge of
2 health and medicine, could reasonably expect the absence of
3 immediate medical attention to result in:
4 (1) placing the health of the individual (or, with
5 respect to a pregnant woman, the health of the woman or
6 her unborn child) in serious jeopardy;
7 (2) serious impairment to bodily functions; or
8 (3) serious dysfunction of any bodily organ or
9 part. "Emergency" means an accidental bodily injury or
10 emergency medical condition which reasonably requires the
11 beneficiary or insured to seek immediate medical care
12 under circumstances or at locations which reasonably
13 preclude the beneficiary or insured from obtaining needed
14 medical care from a preferred provider.
15 (Source: P.A. 88-400.)
16 (215 ILCS 5/370s new)
17 Sec. 370s. Managed Care Reform Act. All administrators
18 shall comply with Section 25 and 75 of the Managed Care
19 Reform Act.
20 (215 ILCS 5/511.118 new)
21 Sec. 511.118. Managed Care Reform Act. All
22 administrators are subject to the provisions of Section 25
23 and 75 of the Managed Care Reform Act.
24 Section 190. The Comprehensive Health Insurance Plan Act
25 is amended by adding Section 8.6 as follows:
26 (215 ILCS 105/8.6 new)
27 Sec. 8.6. Managed Care Reform Act. The plan is subject
28 to the provisions of the Managed Care Reform Act.
29 Section 195. The Health Care Purchasing Group Act is
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1 amended by changing Sections 15 and 20 as follows:
2 (215 ILCS 123/15)
3 Sec. 15. Health care purchasing groups; membership;
4 formation.
5 (a) An HPG may be an organization formed by 2 or more
6 employers with no more than 500 covered employees each 2,500
7 covered individuals, an HPG sponsor or a risk-bearer for
8 purposes of contracting for health insurance under this Act
9 to cover employees and dependents of HPG members. An HPG
10 shall not be prevented from supplementing health insurance
11 coverage purchased under this Act by contracting for services
12 from entities licensed and authorized in Illinois to provide
13 those services under the Dental Service Plan Act, the Limited
14 Health Service Organization Act, or Voluntary Health Services
15 Plans Act. An HPG may be a separate legal entity or simply a
16 group of 2 or more employers with no more than 500 covered
17 employees each 2,500 covered individuals aggregated under
18 this Act by an HPG sponsor or risk-bearer for insurance
19 purposes. There shall be no limit as to the number of HPGs
20 that may operate in any geographic area of the State. No
21 insurance risk may be borne or retained by the HPG. All
22 health insurance contracts issued to the HPG must be
23 delivered or issued for delivery in Illinois.
24 (b) Members of an HPG must be Illinois domiciled
25 employers, except that an employer domiciled elsewhere may
26 become a member of an Illinois HPG for the sole purpose of
27 insuring its employees whose place of employment is located
28 within this State. HPG membership may include employers
29 having no more than 500 covered employees each 2,500 covered
30 individuals.
31 (c) If an HPG is formed by any 2 or more employers with
32 no more than 500 covered employees each 2,500 covered
33 individuals, it is authorized to negotiate, solicit, market,
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1 obtain proposals for, and enter into group or master health
2 insurance contracts on behalf of its members and their
3 employees and employee dependents so long as it meets all of
4 the following requirements:
5 (1) The HPG must be an organization having the
6 legal capacity to contract and having its legal situs in
7 Illinois.
8 (2) The principal persons responsible for the
9 conduct of the HPG must perform their HPG related
10 functions in Illinois.
11 (3) No HPG may collect premium in its name or hold
12 or manage premium or claim fund accounts unless duly
13 licensed and qualified as a managing general agent
14 pursuant to Section 141a of the Illinois Insurance Code
15 or a third party administrator pursuant to Section
16 511.105 of the Illinois Insurance Code.
17 (4) If the HPG gives an offer, application, notice,
18 or proposal of insurance to an employer, it must disclose
19 to that employer the total cost of the insurance. Dues,
20 fees, or charges to be paid to the HPG, HPG sponsor, or
21 any other entity as a condition to purchasing the
22 insurance must be itemized. The HPG shall also disclose
23 to its members the amount of any dividends, experience
24 refunds, or other such payments it receives from the
25 risk-bearer.
26 (5) An HPG must register with the Director before
27 entering into a group or master health insurance contract
28 on behalf of its members and must renew the registration
29 annually on forms and at times prescribed by the Director
30 in rules specifying, at minimum, (i) the identity of the
31 officers and directors, trustees, or attorney-in-fact of
32 the HPG; (ii) a certification that those persons have not
33 been convicted of any felony offense involving a breach
34 of fiduciary duty or improper manipulation of accounts;
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1 and (iii) the number of employer members then enrolled in
2 the HPG, together with any other information that may be
3 needed to carry out the purposes of this Act.
4 (6) At the time of initial registration and each
5 renewal thereof an HPG shall pay a fee of $100 to the
6 Director.
7 (d) If an HPG is formed by an HPG sponsor or risk-bearer
8 and the HPG performs no marketing, negotiation, solicitation,
9 or proposing of insurance to HPG members, exclusive of
10 ministerial acts performed by individual employers to service
11 their own employees, then a group or master health insurance
12 contract may be issued in the name of the HPG and held by an
13 HPG sponsor, risk-bearer, or designated employer member
14 within the State. In these cases the HPG requirements
15 specified in subsection (c) shall not be applicable, however:
16 (1) the group or master health insurance contract
17 must contain a provision permitting the contract to be
18 enforced through legal action initiated by any employer
19 member or by an employee of an HPG member who has paid
20 premium for the coverage provided;
21 (2) the group or master health insurance contract
22 must be available for inspection and copying by any HPG
23 member, employee, or insured dependent at a designated
24 location within the State at all normal business hours;
25 and
26 (3) any information concerning HPG membership
27 required by rule under item (5) of subsection (c) must be
28 provided by the HPG sponsor in its registration and
29 renewal forms or by the risk-bearer in its annual
30 reports.
31 (Source: P.A. 90-337, eff. 1-1-98; 90-655, eff. 7-30-98.)
32 (215 ILCS 123/20)
33 Sec. 20. HPG sponsors. Except as provided by Sections 15
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1 and 25 of this Act, only a corporation authorized by the
2 Secretary of State to transact business in Illinois may
3 sponsor one or more HPGs with no more than 100,000 10,000
4 covered individuals by negotiating, soliciting, or servicing
5 health insurance contracts for HPGs and their members. Such a
6 corporation may assert and maintain authority to act as an
7 HPG sponsor by complying with all of the following
8 requirements:
9 (1) The principal officers and directors
10 responsible for the conduct of the HPG sponsor must
11 perform their HPG sponsor related functions in Illinois.
12 (2) No insurance risk may be borne or retained by
13 the HPG sponsor; all health insurance contracts issued to
14 HPGs through the HPG sponsor must be delivered in
15 Illinois.
16 (3) No HPG sponsor may collect premium in its name
17 or hold or manage premium or claim fund accounts unless
18 duly qualified and licensed as a managing general agent
19 pursuant to Section 141a of the Illinois Insurance Code
20 or as a third party administrator pursuant to Section
21 511.105 of the Illinois Insurance Code.
22 (4) If the HPG gives an offer, application, notice,
23 or proposal of insurance to an employer, it must disclose
24 the total cost of the insurance. Dues, fees, or charges
25 to be paid to the HPG, HPG sponsor, or any other entity
26 as a condition to purchasing the insurance must be
27 itemized. The HPG shall also disclose to its members the
28 amount of any dividends, experience refunds, or other
29 such payments it receives from the risk-bearer.
30 (5) An HPG sponsor must register with the Director
31 before negotiating or soliciting any group or master
32 health insurance contract for any HPG and must renew the
33 registration annually on forms and at times prescribed by
34 the Director in rules specifying, at minimum, (i) the
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1 identity of the officers and directors of the HPG sponsor
2 corporation; (ii) a certification that those persons have
3 not been convicted of any felony offense involving a
4 breach of fiduciary duty or improper manipulation of
5 accounts; (iii) the number of employer members then
6 enrolled in each HPG sponsored; (iv) the date on which
7 each HPG was issued a group or master health insurance
8 contract, if any; and (v) the date on which each such
9 contract, if any, was terminated.
10 (6) At the time of initial registration and each
11 renewal thereof an HPG sponsor shall pay a fee of $100 to
12 the Director.
13 (Source: P.A. 90-337, eff. 1-1-98.)
14 Section 200. The Health Maintenance Organization Act is
15 amended by changing Sections 2-2 and 6-7 and adding Section
16 5-3.6 as follows:
17 (215 ILCS 125/2-2) (from Ch. 111 1/2, par. 1404)
18 Sec. 2-2. Determination by Director; Health Maintenance
19 Advisory Board.
20 (a) Upon receipt of an application for issuance of a
21 certificate of authority, the Director shall transmit copies
22 of such application and accompanying documents to the
23 Director of the Illinois Department of Public Health. The
24 Director of the Department of Public Health shall then
25 determine whether the applicant for certificate of authority,
26 with respect to health care services to be furnished: (1) has
27 demonstrated the willingness and potential ability to assure
28 that such health care service will be provided in a manner to
29 insure both availability and accessibility of adequate
30 personnel and facilities and in a manner enhancing
31 availability, accessibility, and continuity of service; and
32 (2) has arrangements, established in accordance with rules
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1 regulations promulgated by the Department of Public Health
2 for an ongoing quality of health care assurance program
3 concerning health care processes and outcomes. Upon
4 investigation, the Director of the Department of Public
5 Health shall certify to the Director whether the proposed
6 Health Maintenance Organization meets the requirements of
7 this subsection (a). If the Director of the Department of
8 Public Health certifies that the Health Maintenance
9 Organization does not meet such requirements, he or she shall
10 specify in what respect it is deficient.
11 There is created in the Department of Public Health a
12 Health Maintenance Advisory Board composed of 11 members.
13 Nine of the 11 9 members shall who have practiced in the
14 health field and, 4 of those 9 which shall have been or shall
15 be are currently affiliated with a Health Maintenance
16 Organization. Two of the members shall be members of the
17 general public, one of whom is over 65 years of age. Each
18 member shall be appointed by the Director of the Department
19 of Public Health and serve at the pleasure of that Director
20 and shall receive no compensation for services rendered other
21 than reimbursement for expenses. Six Five members of the
22 Board shall constitute a quorum. A vacancy in the membership
23 of the Advisory Board shall not impair the right of a quorum
24 to exercise all rights and perform all duties of the Board.
25 The Health Maintenance Advisory Board has the power to review
26 and comment on proposed rules and regulations to be
27 promulgated by the Director of the Department of Public
28 Health within 30 days after those proposed rules and
29 regulations have been submitted to the Advisory Board.
30 (b) Issuance of a certificate of authority shall be
31 granted if the following conditions are met:
32 (1) the requirements of subsection (c) of Section
33 2-1 have been fulfilled;
34 (2) the persons responsible for the conduct of the
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1 affairs of the applicant are competent, trustworthy, and
2 possess good reputations, and have had appropriate
3 experience, training or education;
4 (3) the Director of the Department of Public Health
5 certifies that the Health Maintenance Organization's
6 proposed plan of operation meets the requirements of this
7 Act;
8 (4) the Health Care Plan furnishes basic health
9 care services on a prepaid basis, through insurance or
10 otherwise, except to the extent of reasonable
11 requirements for co-payments or deductibles as authorized
12 by this Act;
13 (5) the Health Maintenance Organization is
14 financially responsible and may reasonably be expected to
15 meet its obligations to enrollees and prospective
16 enrollees; in making this determination, the Director
17 shall consider:
18 (A) the financial soundness of the applicant's
19 arrangements for health services and the minimum
20 standard rates, co-payments and other patient
21 charges used in connection therewith;
22 (B) the adequacy of working capital, other
23 sources of funding, and provisions for
24 contingencies; and
25 (C) that no certificate of authority shall be
26 issued if the initial minimum net worth of the
27 applicant is less than $2,000,000. The initial net
28 worth shall be provided in cash and securities in
29 combination and form acceptable to the Director;
30 (6) the agreements with providers for the provision
31 of health services contain the provisions required by
32 Section 2-8 of this Act; and
33 (7) any deficiencies identified by the Director
34 have been corrected.
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1 (Source: P.A. 86-620; 86-1475.)
2 (215 ILCS 125/5-3.6 new)
3 Sec. 5-3.6. Managed Care Reform Act. Health
4 maintenance organizations are subject to the provisions of
5 the Managed Care Reform Act.
6 (215 ILCS 125/6-7) (from Ch. 111 1/2, par. 1418.7)
7 Sec. 6-7. Board of Directors. The board of directors of
8 the Association shall consist consists of not less than 7 5
9 nor more than 11 9 members serving terms as established in
10 the plan of operation. The members of the board are to be
11 selected by member organizations subject to the approval of
12 the Director provided, however, that 2 members shall be
13 enrollees, one of whom is over 65 years of age. Vacancies on
14 the board must be filled for the remaining period of the term
15 in the manner described in the plan of operation. To select
16 the initial board of directors, and initially organize the
17 Association, the Director must give notice to all member
18 organizations of the time and place of the organizational
19 meeting. In determining voting rights at the organizational
20 meeting each member organization is entitled to one vote in
21 person or by proxy. If the board of directors is not
22 selected at the organizational meeting, the Director may
23 appoint the initial members.
24 In approving selections or in appointing members to the
25 board, the Director must consider, whether all member
26 organizations are fairly represented.
27 Members of the board may be reimbursed from the assets of
28 the Association for expenses incurred by them as members of
29 the board of directors but members of the board may not
30 otherwise be compensated by the Association for their
31 services.
32 (Source: P.A. 85-20.)
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1 Section 205. The Limited Health Service Organization Act
2 is amended by adding Section 4002.6 as follows:
3 (215 ILCS 130/4002.6 new)
4 Sec. 4002.6. Managed Care Reform Act. Except for health
5 care plans offering only dental services or only vision
6 services, limited health service organizations are subject to
7 the provisions of the Managed Care Reform Act.
8 Section 210. The Voluntary Health Services Plans Act is
9 amended by adding Section 15.30 as follows:
10 (215 ILCS 165/15.30 new)
11 Sec. 15.30. Managed Care Reform Act. A health service
12 plan corporation is subject to the provisions of the Managed
13 Care Reform Act.
14 Section 215. The Illinois Public Aid Code is amended by
15 adding Section 5-16.12 as follows:
16 (305 ILCS 5/5-16.12 new)
17 Sec. 5-16.12. Managed Care Reform Act. The medical
18 assistance program and other programs administered by the
19 Department are subject to the provisions of the Managed Care
20 Reform Act. The Department may adopt rules to implement those
21 provisions. These rules shall require compliance with that
22 Act in the medical assistance managed care programs and other
23 programs administered by the Department. The medical
24 assistance fee-for-service program is not subject to the
25 provisions of the Managed Care Reform Act.
26 Section 250. Effective date. This Act takes effect
27 January 1, 2000.".