Bill Text: IL HB4780 | 2023-2024 | 103rd General Assembly | Introduced

---

Bill Title: Creates the Dental Loss Ratio Act. Sets forth provisions concerning dental loss ratio reporting. Provides that a health insurer or dental plan carrier that issues, sells, renews, or offers a specialized health insurance policy covering dental services shall, beginning January 1, 2025, annually submit to the Department of Insurance a dental loss ratio filing. Provides a formula for calculating minimum dental loss ratios. Sets forth provisions concerning minimum dental loss ratio requirements. Provides that the Department may adopt rules to implement the Act. Provides that the Act does not apply to an insurance policy issued, sold, renewed, or offered for health care services or coverage provided as a function of the State of Illinois Medicaid coverage for children or adults or disability insurance for covered benefits in the single specialized area of dental-only health care that pays benefits on a fixed benefit, cash payment-only basis. Defines terms. Effective January 1, 2025.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced) 2024-04-05 - Rule 19(a) / Re-referred to Rules Committee [HB4780 Detail]

Download: Illinois-2023-HB4780-Introduced.html

---

103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 HB4780 Introduced , by Rep. Jennifer Gong-Gershowitz SYNOPSIS AS INTRODUCED:
New Act
Creates the Dental Loss Ratio Act. Sets forth provisions concerning dental loss ratio reporting. Provides that a health insurer or dental plan carrier that issues, sells, renews, or offers a specialized health insurance policy covering dental services shall, beginning January 1, 2025, annually submit to the Department of Insurance a dental loss ratio filing. Provides a formula for calculating minimum dental loss ratios. Sets forth provisions concerning minimum dental loss ratio requirements. Provides that the Department may adopt rules to implement the Act. Provides that the Act does not apply to an insurance policy issued, sold, renewed, or offered for health care services or coverage provided as a function of the State of Illinois Medicaid coverage for children or adults or disability insurance for covered benefits in the single specialized area of dental-only health care that pays benefits on a fixed benefit, cash payment-only basis. Defines terms. Effective January 1, 2025.
LRB103 36283 AWJ 66380 b
A BILL FOR
HB4780 LRB103 36283 AWJ 66380 b
AN ACT concerning regulation.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 1. Short title. This Act may be referred to as the
Dental Loss Ratio Act.
Section 5. Definitions. As used in this Act:
"Dental care provider" means a dentist who bills for
services in Illinois.
"Dental loss ratio" means the ratio of incurred claims to
earned premiums as calculated using the formula under Section
10 of this Act.
"Dental plan carrier" means an entity subject to the
insurance laws, rules, and regulations of this State or
subject to the jurisdiction of the Director that contracts or
offers to contract to provide, deliver, arrange for, pay for,
or reimburse any of the costs of dental care services,
including an accident and health insurance company, a health
maintenance organization, a limited health service
organization, a dental service plan corporation, a health
services plan corporation, a voluntary health services plan,
or any other entity providing a plan of dental insurance,
dental benefits, or dental health care services.
"Department" means the Department of Insurance.

HB4780 - 2 - LRB103 36283 AWJ 66380 b
"Director" means the Director of Insurance.
"Earned premiums" means the portion of the premium paid in
the reporting year that is intended to provide coverage during
that reporting period.
"Incurred claims" means the claims for which services were
provided in that reporting year. "Incurred claims" includes
claims that were paid in the reporting year plus unpaid claim
reserves for claims paid after the reporting year.
Section 10. Dental loss ratio reporting.
(a) A health insurer or dental plan carrier that issues,
sells, renews, or offers a specialized health insurance policy
covering dental services shall, beginning January 1, 2025,
annually submit to the Department the dental loss ratio
calculated in accordance with subsection (c). The annual
filing shall, at a minimum, include rates, rating schedules,
and supporting documentation, including ratios of incurred
claims to earned premiums for each calendar year since the
plan's issuance. The required information shall be in the form
established by the Department and shall demonstrate that each
plan complies with the minimum dental loss ratio standards.
(b) The annual filing shall be made publicly available on
the Department's website.
(c) The dental loss ratio for a dental plan or dental
coverage of a health benefit plan shall be determined by
dividing the numerator by the denominator as follows:

HB4780 - 3 - LRB103 36283 AWJ 66380 b
(1) The numerator is the amount spent on dental care.
The amount spent on dental care includes:
(A) the amount expended for clinical dental
services that are services within the American Dental
Association's Code on Dental Procedures and
Nomenclature provided to enrollees that includes
payments under capitation contracts with dental
providers and covered by the contract for dental
clinical services or supplies covered by the contract;
(B) reserves and liabilities established to
account for claims that were incurred during the
reporting year but were not paid within 3 months of the
end of the reporting year; and
(C) any claim payment recovered by insurers from
providers or enrollees using utilization management
efforts that will be deducted from incurred claims
amounts.
(2) The calculation of the numerator does not include:
(A) overpayments that have already been received
from providers that should not be reported as a paid
claim; overpayment recoveries received from providers
must be deducted from incurred claims amounts;
(B) administrative costs, including, but not
limited to, infrastructure, personnel costs, or broker
payments;
(C) amounts paid to third-party vendors for

HB4780 - 4 - LRB103 36283 AWJ 66380 b
secondary network savings;
(D) amounts paid to third-party vendors for
network development, administrative fees, claims
processing, and utilization management; or
(E) amounts paid to providers for professional or
administrative services that do not represent
compensation or reimbursement for covered services
provided to an enrollee, including, but not limited
to, dental record copying costs, attorney's fees,
subrogation vendor fees, compensation to
paraprofessionals, janitors, quality assurance
analysts, administrative supervisors, secretaries to
dental personnel, and dental record clerks.
(3) The denominator is the total amount of the earned
premium revenues, excluding federal and State taxes and
licensing and regulatory fees paid after accounting for
any payments pursuant to federal law. In this paragraph,
"earned premium revenues" means all moneys paid by a
policyholder or subscriber as a condition of receiving
coverage from the issuer, including any fees or other
contributions associated with the dental plan.
(d) If the Director decides to conduct an examination
because the Director finds it necessary to verify a health
insurer's or dental plan carrier's representation in a dental
loss ratio report, then the Department shall provide the
health insurer or dental plan carrier with a notification 30

HB4780 - 5 - LRB103 36283 AWJ 66380 b
days before the commencement of the examination.
(e) The health insurer or dental plan carrier shall have
30 days after the date of notification to electronically
submit to the Department all requested records specified by
the Department. The Director may extend the time for a health
insurer or dental plan carrier to comply with this examination
upon a finding of good cause.
Section 15. Dental loss ratio requirement.
(a) A health insurer or dental plan carrier that issues,
sells, renews, or offers a specialized health insurance policy
covering dental services shall meet a minimum dental loss
ratio requirement of 80%.
(b) If the minimum dental loss ratio is not met, then the
Department shall require a corrective action plan from the
carrier to return excess premiums.
Section 20. Rulemaking. The Department may adopt rules to
implement this Act.
Section 25. Exemptions. This Act does not apply to an
insurance policy issued, sold, renewed, or offered for health
care services or coverage provided as a function of the State
of Illinois Medicaid coverage for children or adults or
disability insurance for covered benefits in the single
specialized area of dental-only health care that pays benefits

HB4780 - 6 - LRB103 36283 AWJ 66380 b
on a fixed benefit, cash payment-only basis.