Bill Text: IL SB1547 | 2013-2014 | 98th General Assembly | Amended

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Bill Title: Amends the Illinois Insurance Code, Health Maintenance Organization Act, Limited Health Service Organization Act, and Voluntary Health Services Plans Act. Provides that no insurer may issue a service provider contract that requires an optometrist or ophthalmologist to provide services or materials to the insurer's policyholders at a fee set by the insurer unless the services or materials are covered services or materials under the applicable policyholder agreement. Effective January 1, 2014.

Spectrum: Bipartisan Bill

Status: (Failed) 2015-01-13 - Session Sine Die [SB1547 Detail]

Download: Illinois-2013-SB1547-Amended.html

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Rep. Lou Lang

Filed: 3/4/2014

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AMENDMENT TO SENATE BILL 1547
AMENDMENT NO. ______. Amend Senate Bill 1547, AS AMENDED,
by replacing everything after the enacting clause with the
following:
"Section 5. The Illinois Insurance Code is amended by
changing Sections 370g and 370h and by adding Sections 370d.1
and 370u as follows:
(215 ILCS 5/370d.1 new)
Sec. 370d.1. Exclusive provider organization plans.
(a) For the purpose of this Section:
"Exclusive provider organization plan" or "EPO" means
a benefit plan that utilizes a network of contracted health
care providers and that excludes benefits for services
provided by non-contracted health care providers, except
for emergency services or when services are not available
to an insured from a contracted provider within a

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designated service area.
"Designated service area" means a geographic service
area as specified in a health insurance policy for an EPO
with approval from the Department.
"Emergency services" means, with respect to an
enrollee of a health care plan, transportation services,
including, but not limited to, ambulance services, and
covered inpatient and outpatient hospital services
furnished by a provider qualified to furnish those services
that are needed to evaluate or stabilize an emergency
medical condition. "Emergency services" does not include
post-stabilization medical services.
(b) An insurer having authority under Class 1(b) or 2(a) of
Section 4 of this Code to write accident and health insurance
under the provisions of this Code shall be authorized to issue
policies for exclusive provider organization plans for either
group or individual policies, provided such policies otherwise
conform to the terms of this Section, the Uniform Health Care
Service Benefits Information Card Act, and the Health Carrier
External Review Act. An insurer issuing exclusive provider
organization plans under this Section shall not be required to
be licensed as a health maintenance organization under the
Health Maintenance Organization Act in order to issue a policy
under this Section.
(c) An insurer writing policies for an EPO shall limit
enrollment in such a plan solely to those individuals who

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either live, work, or reside in the designated service area.
(d) Except as otherwise stated in this Section, an EPO
shall comply with all other provisions of this Code, and
regulations issued hereunder, relating to accident and health
insurance policies that utilize a contracted health care
provider network to provide the benefits under such policies.
(e) This Section does not apply to:
(1) the Children's Health Insurance Program issued
under the Children's Health Insurance Program Act;
(2) a Medicaid managed care program issued under
Article V of the Illinois Public Aid Code; or
(3) the State Employees' Group Insurance Act.
(f) An insurer writing policies for an EPO shall provide
within the contract and evidence of coverage a description of
benefits and services available out of the EPO's designated
service area, including any limitations and exclusions.
(g) An insurer shall not require a health care professional
or health care provider, as a condition of participating in the
EPO, to sign a contract requiring the health care professional
or health care provider to provide services under another of
the company's networks or plans.
(h) An insurer shall not require a health care professional
or health care provider, as a condition of participating in any
of the company's networks or plans, to sign a contract
requiring the health care professional or health care provider
to provide services under the insurer's EPO.

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(i) An EPO issued or renewed in this State must prominently
display on the cover page of the policy, evidence of coverage,
and any marketing materials, that it is an exclusive provider
organization benefit plan and that services, other than
emergency services, provided by non-contracted health care
providers may not be covered under the plan, as well as the
components of an EPO plan, including explanations of in-network
and out-of-network services.
(j) An EPO must clearly state on the health care benefit
information card that it is an EPO.
(k) An insurer that issues, delivers, amends, or renews an
individual or group EPO in this State after the effective date
of this amendatory Act of the 98th General Assembly must
include the following disclosure on its contracts and evidences
of coverage: "WARNING, NO BENEFITS WILL BE PAID WHEN NON-
PARTICIPATING PROVIDERS ARE USED. You should be aware that no
benefits shall be available under this plan except for
emergency services or when services are not available from a
contracted provider within the designated service area. YOU
WILL HAVE TO PAY FOR ANY SERVICE OR TREATMENT OUTSIDE OF THE
EXCLUSIVE PROVIDER ORGANIZATION PLAN NETWORK.
Non-participating providers may bill members for any
treatments and services provided to the patient. Participating
providers have agreed to accept discounted payments for
services with no additional billing to the member other than
copayments, co-insurance, and deductible amounts. You may

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obtain further information about the participating status of
professional providers by calling the toll-free telephone
number on your identification card.".
(l) Any insurer that issues, delivers, amends, or renews an
individual or group EPO in this State after the effective date
of this amendatory Act of the 98th General Assembly must comply
with Sections 20, 25, 30, 35, 45, 65, 70, 85, 95, and 100 of the
Managed Care Reform and Patient Rights Act.
(m) Any insurer that issues, delivers, amends, or renews an
individual or group EPO in this State after the effective date
of this amendatory Act of the 98th General Assembly must comply
with the following provisions:
(1) An EPO shall provide annually to enrollees and
prospective enrollees, upon request, a complete list of
participating health care providers in the health care
plan's service area and a description of the following
terms of coverage:
(A) the service area;
(B) the covered benefits and services with all
exclusions, exceptions, and limitations;
(C) the pre-certification and other utilization
review procedures and requirements;
(D) the emergency coverage and benefits, including
specifics on the differences in benefits between
emergency care and non-emergency care, including any
restrictions on emergency care services, so long as

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such specifics and restrictions allow coverage for
medical conditions within the meaning of an emergency
medical condition as defined in Section 10 of the
Managed Care Reform and Patient Rights Act;
(E) the out-of-area coverage and benefits, if any;
(F) the enrollee's financial responsibility for
copayments, deductibles, premiums, and any other
out-of-pocket expenses;
(G) the provisions for continuity of treatment in
the event a health care provider's participation
terminates during the course of an enrollee's
treatment by that provider; and
(H) the appeals process, forms, and time frames for
health care services appeals, complaints, and external
independent reviews, administrative complaints, and
utilization review complaints, including a phone
number to call to receive more information from the
health care plan concerning the appeals process.
(2) An EPO shall provide the information required to be
disclosed under this Section upon enrollment and annually
thereafter in a legible and understandable format.
(3) The written disclosure requirements of this
Section may be met by disclosure to one enrollee in a
household.
(n) The following provisions shall apply concerning EPO
restrictions on primary care physicians.

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(1) An EPO is prohibited from requiring enrollees to
choose a primary care physician for the coordination of
care.
(2) Enrollees may at any time select any physician from
within the EPO network to provide care.
(3) An EPO is prohibited from requiring enrollees to
obtain prior authorization from any participating
physician in the network before seeing an EPO network
provider of their choice.
(o) An insurer that issues, delivers, amends, or renews an
individual or group EPO shall provide an internal claims and
appeals process that incorporates the claims and appeals
procedures set forth in Section 45 of the Managed Care Reform
and Patient Rights Act.
(p) The Director of Insurance shall adopt rules necessary
to implement this Section.
(215 ILCS 5/370g) (from Ch. 73, par. 982g)
Sec. 370g. Definitions. As used in this Article, the
following definitions apply:
(a) "Health care services" means health care services or
products rendered or sold by a provider within the scope of the
provider's license or legal authorization. The term includes,
but is not limited to, hospital, medical, surgical, dental,
vision and pharmaceutical services or products.
(b) "Insurer" means an insurance company or a health

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service corporation authorized in this State to issue policies
or subscriber contracts which reimburse for expenses of health
care services.
(c) "Insured" means an individual entitled to
reimbursement for expenses of health care services under a
policy or subscriber contract issued or administered by an
insurer.
(d) "Provider" means an individual or entity duly licensed
or legally authorized to provide health care services.
(e) "Noninstitutional provider" means any person licensed
under the Medical Practice Act of 1987, as now or hereafter
amended.
(f) "Beneficiary" means an individual entitled to
reimbursement for expenses of or the discount of provider fees
for health care services under a program where the beneficiary
has an incentive to utilize the services of a provider which
has entered into an agreement or arrangement with an
administrator.
(g) "Administrator" means any person, partnership or
corporation, other than an insurer or health maintenance
organization holding a certificate of authority under the
"Health Maintenance Organization Act", as now or hereafter
amended, that arranges, contracts with, or administers
contracts with a provider whereby beneficiaries are provided an
incentive to use the services of such provider.
(h) "Emergency medical condition" means a medical

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condition manifesting itself by acute symptoms of sufficient
severity (including severe pain) such that a prudent layperson,
who possesses an average knowledge of health and medicine,
could reasonably expect the absence of immediate medical
attention to result in:
(1) placing the health of the individual (or, with
respect to a pregnant woman, the health of the woman or her
unborn child) in serious jeopardy;
(2) serious impairment to bodily functions; or
(3) serious dysfunction of any bodily organ or part.
(i) "Exclusive provider organization plan" or "EPO" means a
benefit plan that utilizes a network of contracted health care
providers and that excludes benefits for services provided by
non-contracted health care providers, except for emergency
services and subject to the requirements of Section 356z.3a or
when services are not available to an insured from a contracted
provider within a designated service area.
(j) "Designated service area" means a geographic area as
specified in a health insurance policy for an EPO.
(Source: P.A. 91-617, eff. 1-1-00.)
(215 ILCS 5/370h) (from Ch. 73, par. 982h)
Sec. 370h. Noninstitutional providers.
(a) Before entering into any agreement under this Article
an insurer or administrator shall establish terms and
conditions that must be met by noninstitutional providers

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wishing to enter into an agreement with the insurer or
administrator. These terms and conditions may not discriminate
unreasonably against or among noninstitutional providers.
Neither difference in prices among noninstitutional providers
produced by a process of individual negotiation nor price
differences among other noninstitutional providers in
different geographical areas or different specialties
constitutes unreasonable discrimination.
(b) An insurer or administrator shall not refuse to
contract with any noninstitutional provider who meets the terms
and conditions established by the insurer or administrator.
(c) Any insurer that issues, delivers, amends, or renews an
individual or group EPO in this State after the effective date
of this amendatory Act of the 98th General Assembly shall not
be obligated to comply with this Section solely with respect to
the EPO product.
(Source: P.A. 90-655, eff. 7-30-98.)
(215 ILCS 5/370u new)
Sec. 370u. Exclusive provider organization plans
permitted.
(a) An insurer having authority under Class 1(b) or 2(a) of
Section 4 of this Code to write accident and health insurance
as applicable under this Code, may offer an EPO, provided that
the administrator meets the requirements of this Code and the
Director determines that:

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(1) the level of coverage, including deductibles,
copayments, coinsurance, or other cost-sharing provisions
to beneficiaries, or insured individuals does not operate
unreasonably to restrict the access and availability of
health care services for the insured; or
(2) the EPO has established an exclusive network that
is adequate to provide health care services as required.
(b) Until the effective date of the rules adopted by the
Director for EPO plans, insurers must file a description of the
services to be offered through an EPO. The description shall
include all of the following:
(1) The method of marketing the program.
(2) A geographic map of the area proposed to be served
by the program by county and zip code, including marked
locations for providers.
(3) The names, addresses, and specialties of the
providers who have entered into EPO contracts under the
program.
(4) The names of available primary care physicians and
the encouragement of each enrollee to select such a
physician to handle their care coordination.
(5) The number of beneficiaries anticipated to be
covered by the providers listed in paragraph (3) of this
subsection (b).
(6) An Internet website and toll-free telephone number
for beneficiaries and prospective beneficiaries to access

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regarding up-to-date lists of providers. A plan shall
identify specific providers in a beneficiary's area,
confirm specific provider participation, or provide a
listing of providers by mail. Provider lists requested by
phone must be sent within 3 working days after the request
is made. The up-to-date provider list applies to all
providers that have entered arrangements to provide
services under the program either directly or indirectly
through another administrator. Insurers' Internet website
addresses shall be prominently displayed on all
advertisements, marketing materials, brochures, benefit
cards, and identification cards.
(7) A description of how health care services to be
rendered under the EPO provider program are reasonably
accessible and available to beneficiaries. Standards shall
address the following:
(A) The ratio of providers to beneficiaries, by
specialty applicable under the contract, necessary to
meet the health care needs and service demands of the
currently enrolled population such that there shall be
at least one full-time physician for each 1,200
enrollees.
(B) The greatest distance or time that the
beneficiary may be required to travel to access:
(i) provider hospital services when applicable
under the contract;

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(ii) primary care physician and women's
principal health care provider services when
applicable under the contract; and
(iii) any applicable health care service
providers.
(C) A process for tracking when providers within
the network stop accepting new EPO patients.
(D) A process for encouraging all EPO providers to
utilize an electronic system to ensure the timely
exchange of health records between and among providers
who have entered into EPO contracts listed in paragraph
(3) of this subsection (b).
(E) Written policies and procedures for
determining when the program is closed to new providers
desiring to enter into EPO arrangements.
(F) Written policies and procedures for adding
providers to meet patient needs based on increases in
the number of beneficiaries, changes in the patient to
provider ratio, changes in medical and health care
capabilities, changes in number of providers accepting
new patients, and increased demand for services.
(G) The provision of 24 hour, 7 day-per-week access
to network-affiliated primary care and women's
principal health care providers.
(H) The procedures for making referrals outside
the network when procedures cannot be provided within

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the network.
(I) A provision that whenever a beneficiary has
made a good faith effort to utilize EPO providers for a
covered service and it is determined the insurer does
not have the appropriate EPO providers due to
insufficient number or type or distance, the insurer
shall ensure, directly or indirectly, by terms
contained in the payor contract, that the beneficiary
will be provided the covered service at no greater cost
to the beneficiary than if the service had been
provided by an EPO provider. This subparagraph (G) does
not apply to a beneficiary who willfully chooses to
access a non-preferred provider for health care
services reasonably available through the insurer's
panel of participating providers. In these
circumstances, the contractual requirements for
non-preferred provider reimbursements shall apply.
(J) The procedures for paying benefits when
particular physician specialties are not represented
within the provider network or the services of such
providers are not available at the time care is sought.
In any case in which a beneficiary has made a good
faith effort to utilize network providers, by
satisfying contractual obligations specified in the
benefit contract or certificate, for a covered service
and the insurer does not have the appropriate preferred

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specialty providers (including, but not limited to,
radiologists, anesthesiologists, pathologists and
emergency room physicians) under contract due to the
inability of the insurer to contract with the
specialists, or due to the insufficient number or type
of, or travel distance to, specialists, the insurer
shall ensure that the beneficiary will be provided the
covered service at no greater cost to the beneficiary
than if the service had been provided by an EPO
provider. This subparagraph (J) does not apply to a
beneficiary who willfully chooses to access a
non-preferred provider for health care services
reasonably available through the insurer's panel of
participating providers. In these circumstances, the
contractual requirements for non-preferred provider
reimbursements shall apply.
(K) A provision that the beneficiary shall receive
emergency care coverage such that payment for the
coverage is not dependent upon whether the services are
performed by a preferred or non-preferred provider and
the coverage shall be at the same benefit level as if
the service or treatment had been rendered by a
preferred provider. For the purposes of this
subparagraph (K), "the same benefit level" means that
the beneficiary will be provided the covered service at
no greater cost to the beneficiary than if the service

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had been provided by a preferred provider.
(L) A limitation that, if the plan provides that
the beneficiary will incur a penalty for failing to
pre-certify inpatient hospital treatment, the penalty
may not exceed $1,000 per occurrence.
(M) Efforts to address the needs of beneficiaries
with limited English proficiency and literacy or
diverse cultural and ethnic backgrounds, and to comply
with the Americans With Disabilities Act of 1990.
(N) A sample beneficiary identification card in
conformity with the Uniform Health Care Service
Benefits Information Card Act and the Uniform
Prescription Drug Information Card Act when
pharmaceutical services are provided as part of the
program's health care services.
(8) The process for encouraging EPO providers to
utilize an electronic system to ensure the timely exchange
of health records between and among providers who have
entered into EPO agreements listed in paragraph (3) of this
subsection (b).
(9) The educational efforts the insurer will use to
inform beneficiaries that they are purchasing an EPO
product, including the major differences between an EPO, an
HMO and a PPO.
(c) The Director of Insurance shall adopt rules necessary
to implement this Section.".