Bill Text: IL HB5471 | 2009-2010 | 96th General Assembly | Introduced

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Bill Title: Amends the Managed Care Reform and Patient Rights Act and the Health Carrier External Review Act to provide that a determination by the Director of Insurance to uphold an external review decision that is adverse to an enrollee is subject to the process of administrative review pursuant to the Code of Civil Procedure. Further amends the Health Carrier External Review Act. Provides that when a health carrier sends any request for payment to a covered person, the health carrier shall include a written statement of the health care patient rights. Provides that the Office of Consumer Health Insurance within the Department of Insurance shall provide consultation and case management and shall establish a toll-free phone number for covered persons. Provides that every health carrier shall expend in the form of health care benefits no less than 85% of the aggregate dues, fees, and premiums received by the health carrier. Provides that a health carrier may average its total costs across all health benefit plans in compliance with the provision concerning minimum medical loss expenditures. Contains a nonacceleration clause. Makes other changes.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2010-03-26 - Rule 19(a) / Re-referred to Rules Committee [HB5471 Detail]

Download: Illinois-2009-HB5471-Introduced.html

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96TH GENERAL ASSEMBLY State of Illinois 2009 and 2010 HB5471 Introduced 2/5/2010, by Rep. Mary E. Flowers SYNOPSIS AS INTRODUCED:
215 ILCS 134/45
215 ILCS 180/20
215 ILCS 180/25
215 ILCS 180/45
215 ILCS 180/80 new
Amends the Managed Care Reform and Patient Rights Act and the Health Carrier External Review Act to provide that a determination by the Director of Insurance to uphold an external review decision that is adverse to an enrollee is subject to the process of administrative review pursuant to the Code of Civil Procedure. Further amends the Health Carrier External Review Act. Provides that when a health carrier sends any request for payment to a covered person, the health carrier shall include a written statement of the health care patient rights. Provides that the Office of Consumer Health Insurance within the Department of Insurance shall provide consultation and case management and shall establish a toll-free phone number for covered persons. Provides that every health carrier shall expend in the form of health care benefits no less than 85% of the aggregate dues, fees, and premiums received by the health carrier. Provides that a health carrier may average its total costs across all health benefit plans in compliance with the provision concerning minimum medical loss expenditures. Contains a nonacceleration clause. Makes other changes.
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A BILL FOR
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AN ACT concerning insurance.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Managed Care Reform and Patient Rights Act
is amended by changing Section 45 as follows:
(215 ILCS 134/45)
(Text of Section before amendment by P.A. 96-857)
Sec. 45. Health care services appeals, complaints, and
external independent reviews.
(a) A health care plan shall establish and maintain an
appeals procedure as outlined in this Act. Compliance with this
Act's appeals procedures shall satisfy a health care plan's
obligation to provide appeal procedures under any other State
law or rules. All appeals of a health care plan's
administrative determinations and complaints regarding its
administrative decisions shall be handled as required under
Section 50.
(b) When an appeal concerns a decision or action by a
health care plan, its employees, or its subcontractors that
relates to (i) health care services, including, but not limited
to, procedures or treatments, for an enrollee with an ongoing
course of treatment ordered by a health care provider, the
denial of which could significantly increase the risk to an

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enrollee's health, or (ii) a treatment referral, service,
procedure, or other health care service, the denial of which
could significantly increase the risk to an enrollee's health,
the health care plan must allow for the filing of an appeal
either orally or in writing. Upon submission of the appeal, a
health care plan must notify the party filing the appeal, as
soon as possible, but in no event more than 24 hours after the
submission of the appeal, of all information that the plan
requires to evaluate the appeal. The health care plan shall
render a decision on the appeal within 24 hours after receipt
of the required information. The health care plan shall notify
the party filing the appeal and the enrollee, enrollee's
primary care physician, and any health care provider who
recommended the health care service involved in the appeal of
its decision orally followed-up by a written notice of the
determination.
(c) For all appeals related to health care services
including, but not limited to, procedures or treatments for an
enrollee and not covered by subsection (b) above, the health
care plan shall establish a procedure for the filing of such
appeals. Upon submission of an appeal under this subsection, a
health care plan must notify the party filing an appeal, within
3 business days, of all information that the plan requires to
evaluate the appeal. The health care plan shall render a
decision on the appeal within 15 business days after receipt of
the required information. The health care plan shall notify the

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party filing the appeal, the enrollee, the enrollee's primary
care physician, and any health care provider who recommended
the health care service involved in the appeal orally of its
decision followed-up by a written notice of the determination.
(d) An appeal under subsection (b) or (c) may be filed by
the enrollee, the enrollee's designee or guardian, the
enrollee's primary care physician, or the enrollee's health
care provider. A health care plan shall designate a clinical
peer to review appeals, because these appeals pertain to
medical or clinical matters and such an appeal must be reviewed
by an appropriate health care professional. No one reviewing an
appeal may have had any involvement in the initial
determination that is the subject of the appeal. The written
notice of determination required under subsections (b) and (c)
shall include (i) clear and detailed reasons for the
determination, (ii) the medical or clinical criteria for the
determination, which shall be based upon sound clinical
evidence and reviewed on a periodic basis, and (iii) in the
case of an adverse determination, the procedures for requesting
an external independent review under subsection (f).
(e) If an appeal filed under subsection (b) or (c) is
denied for a reason including, but not limited to, the service,
procedure, or treatment is not viewed as medically necessary,
denial of specific tests or procedures, denial of referral to
specialist physicians or denial of hospitalization requests or
length of stay requests, any involved party may request an

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external independent review under subsection (f) of the adverse
determination.
(f) External independent review.
(1) The party seeking an external independent review
shall so notify the health care plan. The health care plan
shall seek to resolve all external independent reviews in
the most expeditious manner and shall make a determination
and provide notice of the determination no more than 24
hours after the receipt of all necessary information when a
delay would significantly increase the risk to an
enrollee's health or when extended health care services for
an enrollee undergoing a course of treatment prescribed by
a health care provider are at issue.
(2) Within 30 days after the enrollee receives written
notice of an adverse determination, if the enrollee decides
to initiate an external independent review, the enrollee
shall send to the health care plan a written request for an
external independent review, including any information or
documentation to support the enrollee's request for the
covered service or claim for a covered service.
(3) Within 30 days after the health care plan receives
a request for an external independent review from an
enrollee, the health care plan shall:
(A) provide a mechanism for joint selection of an
external independent reviewer by the enrollee, the
enrollee's physician or other health care provider,

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and the health care plan; and
(B) forward to the independent reviewer all
medical records and supporting documentation
pertaining to the case, a summary description of the
applicable issues including a statement of the health
care plan's decision, the criteria used, and the
medical and clinical reasons for that decision.
(4) Within 5 days after receipt of all necessary
information, the independent reviewer shall evaluate and
analyze the case and render a decision that is based on
whether or not the health care service or claim for the
health care service is medically appropriate. The decision
by the independent reviewer is final. If the external
independent reviewer determines the health care service to
be medically appropriate, the health care plan shall pay
for the health care service.
(5) The health care plan shall be solely responsible
for paying the fees of the external independent reviewer
who is selected to perform the review.
(6) An external independent reviewer who acts in good
faith shall have immunity from any civil or criminal
liability or professional discipline as a result of acts or
omissions with respect to any external independent review,
unless the acts or omissions constitute wilful and wanton
misconduct. For purposes of any proceeding, the good faith
of the person participating shall be presumed.

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(7) Future contractual or employment action by the
health care plan regarding the patient's physician or other
health care provider shall not be based solely on the
physician's or other health care provider's participation
in this procedure.
(8) For the purposes of this Section, an external
independent reviewer shall:
(A) be a clinical peer;
(B) have no direct financial interest in
connection with the case; and
(C) have not been informed of the specific identity
of the enrollee.
(9) A determination by the Director to uphold an
external review decision that is adverse to an enrollee is
subject to the process of administrative review pursuant to
Article III of the Code of Civil Procedure.
(g) Nothing in this Section shall be construed to require a
health care plan to pay for a health care service not covered
under the enrollee's certificate of coverage or policy.
(Source: P.A. 91-617, eff. 1-1-00.)
(Text of Section after amendment by P.A. 96-857)
Sec. 45. Health care services appeals, complaints, and
external independent reviews.
(a) A health care plan shall establish and maintain an
appeals procedure as outlined in this Act. Compliance with this

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Act's appeals procedures shall satisfy a health care plan's
obligation to provide appeal procedures under any other State
law or rules. All appeals of a health care plan's
administrative determinations and complaints regarding its
administrative decisions shall be handled as required under
Section 50.
(b) When an appeal concerns a decision or action by a
health care plan, its employees, or its subcontractors that
relates to (i) health care services, including, but not limited
to, procedures or treatments, for an enrollee with an ongoing
course of treatment ordered by a health care provider, the
denial of which could significantly increase the risk to an
enrollee's health, or (ii) a treatment referral, service,
procedure, or other health care service, the denial of which
could significantly increase the risk to an enrollee's health,
the health care plan must allow for the filing of an appeal
either orally or in writing. Upon submission of the appeal, a
health care plan must notify the party filing the appeal, as
soon as possible, but in no event more than 24 hours after the
submission of the appeal, of all information that the plan
requires to evaluate the appeal. The health care plan shall
render a decision on the appeal within 24 hours after receipt
of the required information. The health care plan shall notify
the party filing the appeal and the enrollee, enrollee's
primary care physician, and any health care provider who
recommended the health care service involved in the appeal of

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its decision orally followed-up by a written notice of the
determination.
(c) For all appeals related to health care services
including, but not limited to, procedures or treatments for an
enrollee and not covered by subsection (b) above, the health
care plan shall establish a procedure for the filing of such
appeals. Upon submission of an appeal under this subsection, a
health care plan must notify the party filing an appeal, within
3 business days, of all information that the plan requires to
evaluate the appeal. The health care plan shall render a
decision on the appeal within 15 business days after receipt of
the required information. The health care plan shall notify the
party filing the appeal, the enrollee, the enrollee's primary
care physician, and any health care provider who recommended
the health care service involved in the appeal orally of its
decision followed-up by a written notice of the determination.
(d) An appeal under subsection (b) or (c) may be filed by
the enrollee, the enrollee's designee or guardian, the
enrollee's primary care physician, or the enrollee's health
care provider. A health care plan shall designate a clinical
peer to review appeals, because these appeals pertain to
medical or clinical matters and such an appeal must be reviewed
by an appropriate health care professional. No one reviewing an
appeal may have had any involvement in the initial
determination that is the subject of the appeal. The written
notice of determination required under subsections (b) and (c)

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shall include (i) clear and detailed reasons for the
determination, (ii) the medical or clinical criteria for the
determination, which shall be based upon sound clinical
evidence and reviewed on a periodic basis, and (iii) in the
case of an adverse determination, the procedures for requesting
an external independent review as provided by the Illinois
Health Carrier External Review Act.
(e) If an appeal filed under subsection (b) or (c) is
denied for a reason including, but not limited to, the service,
procedure, or treatment is not viewed as medically necessary,
denial of specific tests or procedures, denial of referral to
specialist physicians or denial of hospitalization requests or
length of stay requests, any involved party may request an
external independent review as provided by the Illinois Health
Carrier External Review Act.
(f) Until July 1, 2013, if an external independent review
decision made pursuant to the Illinois Health Carrier External
Review Act upholds a determination adverse to the covered
person, the covered person has the right to appeal the final
decision to the Department; if the external review decision is
found by the Director to have been arbitrary and capricious,
then the Director, with consultation from a licensed medical
professional, may overturn the external review decision and
require the health carrier to pay for the health care service
or treatment; such decision, if any, shall be made solely on
the legal or medical merits of the claim. If an external review

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decision is overturned by the Director pursuant to this Section
and the health carrier so requests, then the Director shall
assign a new independent review organization to reconsider the
overturned decision. The new independent review organization
shall follow subsection (d) of Section 40 of the Health Carrier
External Review Act in rendering a decision. A determination by
the Director to uphold an external review decision that is
adverse to an enrollee is subject to the process of
administrative review pursuant to Article III of the Code of
Civil Procedure.
(g) Future contractual or employment action by the
health care plan regarding the patient's physician or other
health care provider shall not be based solely on the
physician's or other health care provider's participation in
health care services appeals, complaints, or external
independent reviews under the Illinois Health Carrier External
Review Act.
(h) Nothing in this Section shall be construed to require a
health care plan to pay for a health care service not covered
under the enrollee's certificate of coverage or policy.
(Source: P.A. 96-857, eff. 7-1-10.)
Section 10. The Health Carrier External Review Act is
amended by changing Sections 20, 25, and 45 and by adding
Section 80 as follows:

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(215 ILCS 180/20)
(This Section may contain text from a Public Act with a
delayed effective date)
Sec. 20. Notice of right to external review.
(a) At the same time the health carrier sends written
notice of a covered person's right to appeal a coverage
decision upon an adverse determination or a final adverse
determination as provided by the Managed Care Reform and
Patient Rights Act, a health carrier shall notify a covered
person and a covered person's health care provider in writing
of the covered person's right to request an external review as
provided by this Act. The written notice required shall include
the following, or substantially equivalent, language: "We have
denied your request for the provision of or payment for a
health care service or course of treatment. You have the right
to have our decision reviewed by an independent review
organization not associated with us if our decision involved
making a judgment as to the medical necessity, appropriateness,
health care setting, level of care, or effectiveness of the
health care service or treatment you requested by submitting a
written request for an external review to us. Upon receipt of
your request an independent review organization registered
with the Department of Insurance will be assigned to review our
decision.
(b) This subsection (b) shall apply to an expedited review
prior to a final adverse determination. In addition to the

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notice required in subsection (a), the health carrier shall
include a notice related to an adverse determination, a
statement informing the covered person all of the following:
(1) If the covered person has a medical condition where
the timeframe for completion of (A) an expedited internal
review of a grievance involving an adverse determination,
(B) a final adverse determination as set forth in the
Managed Care Reform and Patient Rights Act, or (C) a
standard external review as established in this Act, would
seriously jeopardize the life or health of the covered
person or would jeopardize the covered person's ability to
regain maximum function, then the covered person or the
covered person's authorized representative may file a
request for an expedited external review.
(2) The covered person or the covered person's
authorized representative may file a request for an
expedited external review at the same time the covered
person or the covered person's authorized representative
files a request for an expedited internal appeal involving
an adverse determination as set forth in the Managed Care
Reform and Patient Rights Act if the adverse determination
involves a denial of coverage based on a determination that
the recommended or requested health care service or
treatment is experimental or investigational and the
covered person's health care provider certifies in writing
that the recommended or requested health care service or

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treatment that is the subject of the adverse determination
would be significantly less effective if not promptly
initiated. The independent review organization assigned to
conduct the expedited external review will determine
whether the covered person shall be required to complete
the expedited review of the grievance prior to conducting
the expedited external review.
(3) If an adverse determination concerns a denial of
coverage based on a determination that the recommended or
requested health care service or treatment is experimental
or investigational and the covered person's health care
provider certifies in writing that the recommended or
requested health care service or treatment that is the
subject of the request would be significantly less
effective if not promptly initiated, then the covered
person or the covered person's authorized representative
may request an expedited external review.
(c) This subsection (c) shall apply to an expedited review
upon final adverse determination. In addition to the notice
required in subsection (a), the health carrier shall include a
notice related to a final adverse determination, a statement
informing the covered person all of the following:
(1) if the covered person has a medical condition where
the timeframe for completion of a standard external review
would seriously jeopardize the life or health of the
covered person or would jeopardize the covered person's

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ability to regain maximum function, then the covered person
or the covered person's authorized representative may file
a request for an expedited external review; or
(2) if a final adverse determination concerns an
admission, availability of care, continued stay, or health
care service for which the covered person received
emergency services, but has not been discharged from a
facility, then the covered person, or the covered person's
authorized representative, may request an expedited
external review; or
(3) if a final adverse determination concerns a denial
of coverage based on a determination that the recommended
or requested health care service or treatment is
experimental or investigational, and the covered person's
health care provider certifies in writing that the
recommended or requested health care service or treatment
that is the subject of the request would be significantly
less effective if not promptly initiated, then the covered
person or the covered person's authorized representative
may request an expedited external review.
(d) In addition to the information to be provided pursuant
to subsections (a), (b), and (c) of this Section, the health
carrier shall include a copy of the description of both the
required standard and expedited external review procedures.
The description shall highlight the external review procedures
that give the covered person or the covered person's authorized

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representative the opportunity to submit additional
information, including any forms used to process an external
review.
(e) In every billing instance when a health carrier sends
any request for payment to a covered person, the health carrier
shall include a written statement of the health care patient
rights as set forth in Section 5 of the Managed Care Reform and
Patient Rights Act.
(Source: P.A. 96-857, eff. 7-1-10.)
(215 ILCS 180/25)
(This Section may contain text from a Public Act with a
delayed effective date)
Sec. 25. Request for external review.
(a) A covered person or the covered person's authorized
representative may make a request for a standard external or
expedited external review of an adverse determination or final
adverse determination. Requests under this Section shall be
made directly to the health carrier that made the adverse or
final adverse determination. All requests for external review
shall be in writing except for requests for expedited external
reviews which may me made orally. Health carriers must provide
covered persons with forms to request external reviews.
(b) The Office of Consumer Health Insurance within the
Department of Insurance shall provide consultation and case
management for covered persons. The Office of Consumer Health

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Insurance shall establish a toll-free phone number for covered
persons who are engaged in an appeal or seeking external review
of an adverse determination or final adverse determination. The
Department shall adopt rules to implement this subsection (b).
(Source: P.A. 96-857, eff. 7-1-10.)
(215 ILCS 180/45)
(This Section may contain text from a Public Act with a
delayed effective date)
Sec. 45. Binding nature of external review decision. An
external review decision is binding on the health carrier. An
external review decision is binding on the covered person
except to the extent the covered person has other remedies
available under applicable federal or State law. A covered
person or the covered person's authorized representative may
not file a subsequent request for external review involving the
same adverse determination or final adverse determination for
which the covered person has already received an external
review decision pursuant to this Act. A determination by the
Director to uphold an external review decision that is adverse
to an enrollee is subject to the process of administrative
review pursuant to Article III of the Code of Civil Procedure.
(Source: P.A. 96-857, eff. 7-1-10.)
(215 ILCS 180/80 new)
Sec. 80. Minimum medical loss requirement.

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(a) Every health carrier shall expend in the form of health
care benefits no less than 85% of the aggregate dues, fees,
premiums, or other periodic payments received by the health
carrier. For purposes of this Section, the health carrier may
deduct from the aggregate dues, fees, premiums, or other
periodic payments received by the health carrier the amount of
income taxes or other taxes that the health carrier expensed.
(b) To assess compliance with this Section, a health
carrier may average its total costs across all health benefit
plans issued, amended, or renewed in this State and all health
benefit plans issued, amended, or renewed by its affiliated
companies that are licensed to operate in this State.
(c) The Department shall adopt rules to implement this
Section and to establish uniform reporting by health carriers
of the information necessary to determine compliance with this
Section.
(d) The Department may exclude from the determination of
compliance with the requirement of subsection (a) of this
Section any new health benefit plans for up to the first 2
years that these health benefit plans are offered for sale in
this State, provided that the Department determines that the
new health benefit plans are substantially different from the
existing health benefit plans being issued, amended, or renewed
by the health carrier seeking the exclusion.
Section 95. No acceleration or delay. Where this Act makes

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changes in a statute that is represented in this Act by text
that is not yet or no longer in effect (for example, a Section
represented by multiple versions), the use of that text does
not accelerate or delay the taking effect of (i) the changes
made by this Act or (ii) provisions derived from any other