Bill Text: IL SB2807 | 2015-2016 | 99th General Assembly | Introduced


Bill Title: Amends the Illinois Insurance Code. Provides that on and after the effective date of the amendatory Act, no insurer that amends, delivers, issues, or renews a group or individual policy of accident and health insurance or a qualified health plan offered through the health insurance marketplace shall: (1) provide or refer to a coverage determination as medically necessary in any publication, policy, contract or agreement, or explanation of benefits made by the policy or plan, or (2) provide or state in any way that treatment or services recommended by the insured or enrollees treating, consulting, ordering, or attending physician or health care provider is not medically necessary, and that doing so is an unfair and deceptive practice under the Code. Provides that nothing shall prohibit a health care benefit determination with respect to whether treatment or services are covered under the policy or plan. Amends the Managed Care Reform and Patient Rights Act to make similar changes for health care plans. Amends the State Employees Group Insurance Act of 1971, Counties Code, Illinois Municipal Code, School Code, Health Maintenance Organization Act, Limited Health Service Organization Act, Voluntary Health Services Plans Act, and Illinois Public Aide Code to make conforming changes.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Introduced - Dead) 2016-04-22 - Rule 3-9(a) / Re-referred to Assignments [SB2807 Detail]

Download: Illinois-2015-SB2807-Introduced.html


99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016
SB2807

Introduced 2/17/2016, by Sen. Linda Holmes

SYNOPSIS AS INTRODUCED:
5 ILCS 375/6.11
55 ILCS 5/5-1069.3
65 ILCS 5/10-4-2.3
105 ILCS 5/10-22.3f
215 ILCS 5/2 from Ch. 73, par. 614
215 ILCS 5/356z.24 new
215 ILCS 130/4003 from Ch. 73, par. 1504-3
215 ILCS 134/10
215 ILCS 134/31 new
215 ILCS 165/10 from Ch. 32, par. 604
305 ILCS 5/5-16.8

Amends the Illinois Insurance Code. Provides that on and after the effective date of the amendatory Act, no insurer that amends, delivers, issues, or renews a group or individual policy of accident and health insurance or a qualified health plan offered through the health insurance marketplace shall: (1) provide or refer to a coverage determination as medically necessary in any publication, policy, contract or agreement, or explanation of benefits made by the policy or plan, or (2) provide or state in any way that treatment or services recommended by the insured or enrollees treating, consulting, ordering, or attending physician or health care provider is not medically necessary, and that doing so is an unfair and deceptive practice under the Code. Provides that nothing shall prohibit a health care benefit determination with respect to whether treatment or services are covered under the policy or plan. Amends the Managed Care Reform and Patient Rights Act to make similar changes for health care plans. Amends the State Employees Group Insurance Act of 1971, Counties Code, Illinois Municipal Code, School Code, Health Maintenance Organization Act, Limited Health Service Organization Act, Voluntary Health Services Plans Act, and Illinois Public Aide Code to make conforming changes.
LRB099 15724 MLM 40023 b

A BILL FOR

SB2807LRB099 15724 MLM 40023 b
1 AN ACT concerning regulation.
2 Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
4 Section 5. The State Employees Group Insurance Act of 1971
5is amended by changing Section 6.11 as follows:
6 (5 ILCS 375/6.11)
7 Sec. 6.11. Required health benefits; Illinois Insurance
8Code requirements. The program of health benefits shall provide
9the post-mastectomy care benefits required to be covered by a
10policy of accident and health insurance under Section 356t of
11the Illinois Insurance Code. The program of health benefits
12shall provide the coverage required under Sections 356g,
13356g.5, 356g.5-1, 356m, 356u, 356w, 356x, 356z.2, 356z.4,
14356z.6, 356z.8, 356z.9, 356z.10, 356z.11, 356z.12, 356z.13,
15356z.14, 356z.15, 356z.17, and 356z.22 of the Illinois
16Insurance Code. The program of health benefits must comply with
17Sections 155.22a, 155.37, 355b, 356z.19, 356z.24, 370c, and
18370c.1 of the Illinois Insurance Code.
19 Rulemaking authority to implement Public Act 95-1045, if
20any, is conditioned on the rules being adopted in accordance
21with all provisions of the Illinois Administrative Procedure
22Act and all rules and procedures of the Joint Committee on
23Administrative Rules; any purported rule not so adopted, for

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1whatever reason, is unauthorized.
2(Source: P.A. 98-189, eff. 1-1-14; 98-1091, eff. 1-1-15;
399-480, eff. 9-9-15.)
4 Section 10. The Counties Code is amended by changing
5Section 5-1069.3 as follows:
6 (55 ILCS 5/5-1069.3)
7 Sec. 5-1069.3. Required health benefits. If a county,
8including a home rule county, is a self-insurer for purposes of
9providing health insurance coverage for its employees, the
10coverage shall include coverage for the post-mastectomy care
11benefits required to be covered by a policy of accident and
12health insurance under Section 356t and the coverage required
13under Sections 356g, 356g.5, 356g.5-1, 356u, 356w, 356x,
14356z.6, 356z.8, 356z.9, 356z.10, 356z.11, 356z.12, 356z.13,
15356z.14, 356z.15, and 356z.22 of the Illinois Insurance Code.
16The coverage shall comply with Sections 155.22a, 355b, 356z.19,
17356z.24, and 370c of the Illinois Insurance Code. The
18requirement that health benefits be covered as provided in this
19Section is an exclusive power and function of the State and is
20a denial and limitation under Article VII, Section 6,
21subsection (h) of the Illinois Constitution. A home rule county
22to which this Section applies must comply with every provision
23of this Section.
24 Rulemaking authority to implement Public Act 95-1045, if

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1any, is conditioned on the rules being adopted in accordance
2with all provisions of the Illinois Administrative Procedure
3Act and all rules and procedures of the Joint Committee on
4Administrative Rules; any purported rule not so adopted, for
5whatever reason, is unauthorized.
6(Source: P.A. 98-189, eff. 1-1-14; 98-1091, eff. 1-1-15;
799-480, eff. 9-9-15.)
8 Section 15. The Illinois Municipal Code is amended by
9changing Section 10-4-2.3 as follows:
10 (65 ILCS 5/10-4-2.3)
11 Sec. 10-4-2.3. Required health benefits. If a
12municipality, including a home rule municipality, is a
13self-insurer for purposes of providing health insurance
14coverage for its employees, the coverage shall include coverage
15for the post-mastectomy care benefits required to be covered by
16a policy of accident and health insurance under Section 356t
17and the coverage required under Sections 356g, 356g.5,
18356g.5-1, 356u, 356w, 356x, 356z.6, 356z.8, 356z.9, 356z.10,
19356z.11, 356z.12, 356z.13, 356z.14, 356z.15, and 356z.22 of the
20Illinois Insurance Code. The coverage shall comply with
21Sections 155.22a, 355b, 356z.19, 356z.24, and 370c of the
22Illinois Insurance Code. The requirement that health benefits
23be covered as provided in this is an exclusive power and
24function of the State and is a denial and limitation under

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1Article VII, Section 6, subsection (h) of the Illinois
2Constitution. A home rule municipality to which this Section
3applies must comply with every provision of this Section.
4 Rulemaking authority to implement Public Act 95-1045, if
5any, is conditioned on the rules being adopted in accordance
6with all provisions of the Illinois Administrative Procedure
7Act and all rules and procedures of the Joint Committee on
8Administrative Rules; any purported rule not so adopted, for
9whatever reason, is unauthorized.
10(Source: P.A. 98-189, eff. 1-1-14; 98-1091, eff. 1-1-15;
1199-480, eff. 9-9-15.)
12 Section 20. The School Code is amended by changing Section
1310-22.3f as follows:
14 (105 ILCS 5/10-22.3f)
15 Sec. 10-22.3f. Required health benefits. Insurance
16protection and benefits for employees shall provide the
17post-mastectomy care benefits required to be covered by a
18policy of accident and health insurance under Section 356t and
19the coverage required under Sections 356g, 356g.5, 356g.5-1,
20356u, 356w, 356x, 356z.6, 356z.8, 356z.9, 356z.11, 356z.12,
21356z.13, 356z.14, 356z.15, and 356z.22 of the Illinois
22Insurance Code. Insurance policies shall comply with Sections
23Section 356z.19 and 356z.24 of the Illinois Insurance Code. The
24coverage shall comply with Sections 155.22a and 355b of the

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1Illinois Insurance Code.
2 Rulemaking authority to implement Public Act 95-1045, if
3any, is conditioned on the rules being adopted in accordance
4with all provisions of the Illinois Administrative Procedure
5Act and all rules and procedures of the Joint Committee on
6Administrative Rules; any purported rule not so adopted, for
7whatever reason, is unauthorized.
8(Source: P.A. 97-282, eff. 8-9-11; 97-343, eff. 1-1-12; 97-813,
9eff. 7-13-12; 98-189, eff. 1-1-14; 98-1091, eff. 1-1-15.)
10 Section 25. The Illinois Insurance Code is amended by
11changing Section 2 and by adding Section 356z.24 as follows:
12 (215 ILCS 5/2) (from Ch. 73, par. 614)
13 Sec. 2. General definitions.
14 In this Code, unless the context otherwise requires,
15 (a) "Director" means the Director of Insurance.
16 (b) "Department" means the Department of Insurance.
17 (c) "State" or "State of the United States" includes the
18District of Columbia and a territory or possession of the
19United States.
20 (d) "Country" or "Foreign Country" includes a state,
21province or political subdivision thereof.
22 (e) "Company" means an insurance or surety company and
23shall be deemed to include a corporation, company, partnership,
24association, society, order, individual or aggregation of

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1individuals engaging in or proposing or attempting to engage in
2any kind of insurance or surety business, including the
3exchanging of reciprocal or inter-insurance contracts between
4individuals, partnerships and corporations.
5 (f) "Domestic Company" means a company incorporated or
6organized under the laws of this State.
7 (g) "Foreign Company" means a company incorporated or
8organized under the laws of any state of the United States
9other than this State.
10 (h) "Alien Company" means a company incorporated or
11organized under the laws of any country other than the United
12States.
13 (i) "Mutual Legal Reserve Life Company" means a mutual life
14company issuing contracts without contingent liability on the
15policyholder.
16 (j) "Assessment Legal Reserve Life Company" means a life
17company issuing contracts providing for contingent liability
18on the policyholder.
19 (k) "Reciprocal" includes Inter-Insurance Exchange.
20 (l) "Person" includes an individual, aggregation of
21individuals, corporation, association and partnership.
22 (m) Personal pronouns include all genders, the singular
23includes the plural and the plural includes the singular.
24 (n) "Policy" means an insurance policy or contract and
25includes certificates of fraternal benefit societies,
26assessment companies, mutual benefit associations, and burial

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1societies.
2 (o) "Policyholder" means a holder of an insurance policy or
3contract and includes holders of certificates of fraternal
4benefit societies, assessment companies, mutual benefit
5associations, and burial societies.
6 (p) "Articles of Incorporation" means the basic instrument
7of an incorporated company and all amendments thereto and
8includes "Charter," "Articles of Organization," "Articles of
9Reorganization," "Articles of Association," and "Deed of
10Settlement."
11 (q) "Officer" when used to refer to an officer of a company
12includes an attorney-in-fact for a reciprocal or Lloyds.
13 (r) "Medically necessary" means that a treating,
14consulting, ordering, or attending physician or health care
15professional or provider recommended, ordered, or provided a
16health care service, device, drug, or supply appropriate to the
17evaluation and treatment of disease, condition, illness, or
18injury and consistent with the applicable standard of care,
19including the evaluation of experimental or investigational
20services, procedures, drugs, or devices.
21(Source: Laws 1937, p. 696.)
22 (215 ILCS 5/356z.24 new)
23 Sec. 356z.24. Medical necessity determinations. On and
24after the effective date of this amendatory Act of the 99th
25General Assembly, no insurer that amends, delivers, issues, or

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1renews a group or individual policy of accident and health
2insurance or a qualified health plan offered through the health
3insurance marketplace in this State providing coverage for
4hospital or any other health care service shall: (1) provide or
5refer to a coverage determination as medically necessary in any
6publication, policy, contract or agreement, or explanation of
7benefits made by the policy or plan or (2) provide or state in
8any way that treatment or services recommended by the insured
9or enrollees treating, consulting, ordering, or attending
10physician or health care provider is not medically necessary,
11to do so shall be considered an unfair and deceptive practice
12under this Code. Nothing in this Section shall prohibit a
13health care benefit determination with respect to whether
14treatment or services are covered under the policy or plan.
15 Section 30. The Limited Health Service Organization Act is
16amended by changing Section 4003 as follows:
17 (215 ILCS 130/4003) (from Ch. 73, par. 1504-3)
18 Sec. 4003. Illinois Insurance Code provisions. Limited
19health service organizations shall be subject to the provisions
20of Sections 133, 134, 136, 137, 139, 140, 141.1, 141.2, 141.3,
21143, 143c, 147, 148, 149, 151, 152, 153, 154, 154.5, 154.6,
22154.7, 154.8, 155.04, 155.37, 355.2, 355.3, 355b, 356v,
23356z.10, 356z.21, 356z.22, 356z.24, 368a, 401, 401.1, 402, 403,
24403A, 408, 408.2, 409, 412, 444, and 444.1 and Articles IIA,

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1VIII 1/2, XII, XII 1/2, XIII, XIII 1/2, XXV, and XXVI of the
2Illinois Insurance Code. For purposes of the Illinois Insurance
3Code, except for Sections 444 and 444.1 and Articles XIII and
4XIII 1/2, limited health service organizations in the following
5categories are deemed to be domestic companies:
6 (1) a corporation under the laws of this State; or
7 (2) a corporation organized under the laws of another
8 state, 30% of more of the enrollees of which are residents
9 of this State, except a corporation subject to
10 substantially the same requirements in its state of
11 organization as is a domestic company under Article VIII
12 1/2 of the Illinois Insurance Code.
13(Source: P.A. 97-486, eff. 1-1-12; 97-592, 1-1-12; 97-805, eff.
141-1-13; 97-813, eff. 7-13-12; 98-189, eff. 1-1-14; 98-1091,
15eff. 1-1-15.)
16 Section 35. The Managed Care Reform and Patient Rights Act
17is amended by changing Section 10 and by adding Section 31 as
18follows:
19 (215 ILCS 134/10)
20 Sec. 10. Definitions.
21 "Adverse determination" means a determination by a health
22care plan under Section 45 or by a utilization review program
23under Section 85 that a health care service is not medically
24necessary.

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1 "Clinical peer" means a health care professional who is in
2the same profession and the same or similar specialty as the
3health care provider who typically manages the medical
4condition, procedures, or treatment under review.
5 "Department" means the Department of Insurance.
6 "Emergency medical condition" means a medical condition
7manifesting itself by acute symptoms of sufficient severity
8(including, but not limited to, severe pain) such that a
9prudent layperson, who possesses an average knowledge of health
10and medicine, could reasonably expect the absence of immediate
11medical attention to result in:
12 (1) placing the health of the individual (or, with
13 respect to a pregnant woman, the health of the woman or her
14 unborn child) in serious jeopardy;
15 (2) serious impairment to bodily functions; or
16 (3) serious dysfunction of any bodily organ or part.
17 "Emergency medical screening examination" means a medical
18screening examination and evaluation by a physician licensed to
19practice medicine in all its branches, or to the extent
20permitted by applicable laws, by other appropriately licensed
21personnel under the supervision of or in collaboration with a
22physician licensed to practice medicine in all its branches to
23determine whether the need for emergency services exists.
24 "Emergency services" means, with respect to an enrollee of
25a health care plan, transportation services, including but not
26limited to ambulance services, and covered inpatient and

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1outpatient hospital services furnished by a provider qualified
2to furnish those services that are needed to evaluate or
3stabilize an emergency medical condition. "Emergency services"
4does not refer to post-stabilization medical services.
5 "Enrollee" means any person and his or her dependents
6enrolled in or covered by a health care plan.
7 "Health care plan" means a plan, including, but not limited
8to, a health maintenance organization, a managed care community
9network as defined in the Illinois Public Aid Code, or an
10accountable care entity as defined in the Illinois Public Aid
11Code that receives capitated payments to cover medical services
12from the Department of Healthcare and Family Services, that
13establishes, operates, or maintains a network of health care
14providers that has entered into an agreement with the plan to
15provide health care services to enrollees to whom the plan has
16the ultimate obligation to arrange for the provision of or
17payment for services through organizational arrangements for
18ongoing quality assurance, utilization review programs, or
19dispute resolution. Nothing in this definition shall be
20construed to mean that an independent practice association or a
21physician hospital organization that subcontracts with a
22health care plan is, for purposes of that subcontract, a health
23care plan.
24 For purposes of this definition, "health care plan" shall
25not include the following:
26 (1) indemnity health insurance policies including

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1 those using a contracted provider network;
2 (2) health care plans that offer only dental or only
3 vision coverage;
4 (3) preferred provider administrators, as defined in
5 Section 370g(g) of the Illinois Insurance Code;
6 (4) employee or employer self-insured health benefit
7 plans under the federal Employee Retirement Income
8 Security Act of 1974;
9 (5) health care provided pursuant to the Workers'
10 Compensation Act or the Workers' Occupational Diseases
11 Act; and
12 (6) not-for-profit voluntary health services plans
13 with health maintenance organization authority in
14 existence as of January 1, 1999 that are affiliated with a
15 union and that only extend coverage to union members and
16 their dependents.
17 "Health care professional" means a physician, a registered
18professional nurse, or other individual appropriately licensed
19or registered to provide health care services.
20 "Health care provider" means any physician, hospital
21facility, facility licensed under the Nursing Home Care Act,
22long-term care facility as defined in Section 1-113 of the
23Nursing Home Care Act, or other person that is licensed or
24otherwise authorized to deliver health care services. Nothing
25in this Act shall be construed to define Independent Practice
26Associations or Physician-Hospital Organizations as health

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1care providers.
2 "Health care services" means any services included in the
3furnishing to any individual of medical care, or the
4hospitalization incident to the furnishing of such care, as
5well as the furnishing to any person of any and all other
6services for the purpose of preventing, alleviating, curing, or
7healing human illness or injury including home health and
8pharmaceutical services and products.
9 "Medical director" means a physician licensed in any state
10to practice medicine in all its branches appointed by a health
11care plan.
12 "Medically necessary" means that a treating, consulting,
13ordering, or attending physician or health care professional or
14provider recommended, ordered, or provided a health care
15service, device, drug, or supply appropriate to the evaluation
16and treatment of disease, condition, illness, or injury and
17consistent with the applicable standard of care, including the
18evaluation of experimental or investigational services,
19procedures, drugs, or devices.
20 "Person" means a corporation, association, partnership,
21limited liability company, sole proprietorship, or any other
22legal entity.
23 "Physician" means a person licensed under the Medical
24Practice Act of 1987.
25 "Post-stabilization medical services" means health care
26services provided to an enrollee that are furnished in a

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1licensed hospital by a provider that is qualified to furnish
2such services, and determined to be medically necessary and
3directly related to the emergency medical condition following
4stabilization.
5 "Stabilization" means, with respect to an emergency
6medical condition, to provide such medical treatment of the
7condition as may be necessary to assure, within reasonable
8medical probability, that no material deterioration of the
9condition is likely to result.
10 "Utilization review" means the evaluation of the medical
11necessity, appropriateness, and efficiency of the use of health
12care services, procedures, and facilities.
13 "Utilization review program" means a program established
14by a person to perform utilization review.
15(Source: P.A. 98-651, eff. 6-16-14; 98-841, eff. 8-1-14; 99-78,
16eff. 7-20-15.)
17 (215 ILCS 134/31 new)
18 Sec. 31. Medical necessity determinations. On and after the
19effective date of this amendatory Act of the 99th General
20Assembly, no health care plan shall: (1) provide or refer to a
21coverage determination as medically necessary in any
22publication, policy, contract or agreement, or explanation of
23benefits made by policy or plan or (2) provide or state in any
24way that treatment or services recommended by the insured or
25enrollees treating, consulting, ordering, or attending

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1physician or health care provider is not medically necessary,
2to do so shall be considered an unfair and deceptive practice
3under the Illinois Insurance Code. Nothing in this Section
4shall prohibit a health care benefit determination with respect
5to whether treatment or services are covered under the policy
6or plan.
7 Section 40. The Voluntary Health Services Plans Act is
8amended by changing Section 10 as follows:
9 (215 ILCS 165/10) (from Ch. 32, par. 604)
10 Sec. 10. Application of Insurance Code provisions. Health
11services plan corporations and all persons interested therein
12or dealing therewith shall be subject to the provisions of
13Articles IIA and XII 1/2 and Sections 3.1, 133, 136, 139, 140,
14143, 143c, 149, 155.22a, 155.37, 354, 355.2, 355.3, 355b, 356g,
15356g.5, 356g.5-1, 356r, 356t, 356u, 356v, 356w, 356x, 356y,
16356z.1, 356z.2, 356z.4, 356z.5, 356z.6, 356z.8, 356z.9,
17356z.10, 356z.11, 356z.12, 356z.13, 356z.14, 356z.15, 356z.18,
18356z.19, 356z.21, 356z.22, 356z.24, 364.01, 367.2, 368a, 401,
19401.1, 402, 403, 403A, 408, 408.2, and 412, and paragraphs (7)
20and (15) of Section 367 of the Illinois Insurance Code.
21 Rulemaking authority to implement Public Act 95-1045, if
22any, is conditioned on the rules being adopted in accordance
23with all provisions of the Illinois Administrative Procedure
24Act and all rules and procedures of the Joint Committee on

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1Administrative Rules; any purported rule not so adopted, for
2whatever reason, is unauthorized.
3(Source: P.A. 97-282, eff. 8-9-11; 97-343, eff. 1-1-12; 97-486,
4eff. 1-1-12; 97-592, eff. 1-1-12; 97-805, eff. 1-1-13; 97-813,
5eff. 7-13-12; 98-189, eff. 1-1-14; 98-1091, eff. 1-1-15.)
6 Section 45. The Illinois Public Aid Code is amended by
7changing Section 5-16.8 as follows:
8 (305 ILCS 5/5-16.8)
9 Sec. 5-16.8. Required health benefits. The medical
10assistance program shall (i) provide the post-mastectomy care
11benefits required to be covered by a policy of accident and
12health insurance under Section 356t and the coverage required
13under Sections 356g.5, 356u, 356w, 356x, and 356z.6 of the
14Illinois Insurance Code and (ii) be subject to the provisions
15of Sections 356z.19, 356z.24, 364.01, 370c, and 370c.1 of the
16Illinois Insurance Code.
17 On and after July 1, 2012, the Department shall reduce any
18rate of reimbursement for services or other payments or alter
19any methodologies authorized by this Code to reduce any rate of
20reimbursement for services or other payments in accordance with
21Section 5-5e.
22 To ensure full access to the benefits set forth in this
23Section, on and after January 1, 2016, the Department shall
24ensure that provider and hospital reimbursement for

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1post-mastectomy care benefits required under this Section are
2no lower than the Medicare reimbursement rate.
3(Source: P.A. 99-433, eff. 8-21-15; 99-480, eff. 9-9-15;
4revised 10-21-15.)
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