Bill Text: IL HB2296 | 2023-2024 | 103rd General Assembly | Chaptered

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Bill Title: Amends the Department of Insurance Law. Provides that beginning before or on May 1, 2026, and each May 1 thereafter, the Department of Insurance shall report to the Governor and the General Assembly on health insurance coverage, affordability, and cost trends. Amends the Illinois Insurance Code. Provides that any forms and rates filed for large employer group accident and health insurance shall be automatically deemed approved after 90 days after filing. Provides that beginning plan year 2026, rate increases for all individual and small group accident and health insurance policies must be filed with the Department for approval. Provides that unreasonable rate increases or inadequate rates shall be modified or disapproved. Provides that beginning plan year 2025, the Department shall post all insurers' rate filings and summaries on the Department's website. Provides that the Department shall open a 30-day public comment period on the date that a rate filing is posted on the website. Provides that after the close of the public comment period, the Department shall issue a decision to approve, disapprove, or modify a rate filing within 60 days, and post the decision on the Department's website. Provides that the Department shall adopt rules implementing specified procedures. Defines terms. Makes conforming changes in the Health Maintenance Organization Act and the Limited Health Service Organization Act.

Spectrum: Partisan Bill (Democrat 69-0)

Status: (Passed) 2023-06-27 - Public Act . . . . . . . . . 103-0106 [HB2296 Detail]

Download: Illinois-2023-HB2296-Chaptered.html

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Public Act 103-0106
HB2296 Enrolled LRB103 27672 AMQ 54049 b
AN ACT concerning regulation.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Department of Insurance Law is amended by
adding Section 1405-50 as follows:
(20 ILCS 1405/1405-50 new)
Sec. 1405-50. Health insurance coverage, affordability,
and cost transparency annual report.
(a) On or before May 1, 2026, and each May 1 thereafter,
the Department of Insurance shall report to the Governor and
the General Assembly on health insurance coverage,
affordability, and cost trends, including:
(1) medical cost trends by major service category,
including prescription drugs;
(2) utilization patterns of services by major service
categories;
(3) impact of benefit changes, including essential
health benefits and non-essential health benefits;
(4) enrollment trends;
(5) demographic shifts;
(6) geographic factors and variations, including
changes in provider availability;
(7) health care quality improvement initiatives;

(8)inflation and other factors impacting this State's
economic condition;
(9) the availability of financial assistance and tax
credits to pay for health insurance coverage for
individuals and small businesses;
(10) trends in out-of-pocket costs for consumers; and
(11) factors contributing to costs that are not
otherwise specified in paragraphs (1) through (10) of this
subsection.
(b) This report shall not attribute any information or
trend to a specific company and shall not disclose any
information otherwise considered confidential or proprietary.
Section 10. The Illinois Insurance Code is amended by
changing Section 355 as follows:
(215 ILCS 5/355) (from Ch. 73, par. 967)
Sec. 355. Accident and health policies; provisions.
policies-Provisions.)
(a) As used in this Section:
"Inadequate rate" means a rate:
(1) that is insufficient to sustain projected losses
and expenses to which the rate applies; and
(2) the continued use of which endangers the solvency
of an insurer using that rate.
"Large employer" has the meaning provided in the Illinois

Health Insurance Portability and Accountability Act.
"Plain language" has the meaning provided in the federal
Plain Writing Act of 2010 and subsequent guidance documents,
including the Federal Plain Language Guidelines.
"Unreasonable rate increase" means a rate increase that
the Director determines to be excessive, unjustified, or
unfairly discriminatory in accordance with 45 CFR 154.205.
(b) No policy of insurance against loss or damage from the
sickness, or from the bodily injury or death of the insured by
accident shall be issued or delivered to any person in this
State until a copy of the form thereof and of the
classification of risks and the premium rates pertaining
thereto have been filed with the Director; nor shall it be so
issued or delivered until the Director shall have approved
such policy pursuant to the provisions of Section 143. If the
Director disapproves the policy form, he or she shall make a
written decision stating the respects in which such form does
not comply with the requirements of law and shall deliver a
copy thereof to the company and it shall be unlawful
thereafter for any such company to issue any policy in such
form. On and after January 1, 2025, any form filing submitted
for large employer group accident and health insurance shall
be automatically deemed approved within 90 days of the
submission date unless the Director extends by not more than
an additional 30 days the period within which the form shall be
approved or disapproved by giving written notice to the

insurer of such extension before the expiration of the 90
days. Any form in receipt of such an extension shall be
automatically deemed approved within 120 days of the
submission date. The Director may toll the filing due to a
conflict in legal interpretation of federal or State law as
long as the tolling is applied uniformly to all applicable
forms, written notification is provided to the insurer prior
to the tolling, the duration of the tolling is provided within
the notice to the insurer, and justification for the tolling
is posted to the Department's website. The Director may
disapprove the filing if the insurer fails to respond to an
objection or request for additional information within the
timeframe identified for response. As used in this subsection,
"large employer" has the meaning given in Section 5 of the
federal Health Insurance Portability and Accountability Act.
(c) For plan year 2026 and thereafter, premium rates for
all individual and small group accident and health insurance
policies must be filed with the Department for approval.
Unreasonable rate increases or inadequate rates shall be
modified or disapproved. For any plan year during which the
Illinois Health Benefits Exchange operates as a full
State-based exchange, the Department shall provide insurers at
least 30 days' notice of the deadline to submit rate filings.
(d) For plan year 2025 and thereafter, the Department
shall post all insurers' rate filings and summaries on the
Department's website 5 business days after the rate filing

deadline set by the Department in annual guidance. The rate
filings and summaries posted to the Department's website shall
exclude information that is proprietary or trade secret
information protected under paragraph (g) of subsection (1) of
Section 7 of the Freedom of Information Act or confidential or
privileged under any applicable insurance law or rule. All
summaries shall include a brief justification of any rate
increase or decrease requested, including the number of
individual members, the medical loss ratio, medical trend,
administrative costs, and any other information required by
rule. The plain writing summary shall include notification of
the public comment period established in subsection (e).
(e) The Department shall open a 30-day public comment
period on the rate filings beginning on the date that all of
the rate filings are posted on the Department's website. The
Department shall post all of the comments received to the
Department's website within 5 business days after the comment
period ends.
(f) After the close of the public comment period described
in subsection (e), the Department, beginning for plan year
2026, shall issue a decision to approve, disapprove, or modify
a rate filing within 60 days. Any rate filing or any rates
within a filing on which the Director does not issue a decision
within 60 days shall automatically be deemed approved. The
Director's decision shall take into account the actuarial
justifications and public comments. The Department shall

notify the insurer of the decision, make the decision
available to the public by posting it on the Department's
website, and include an explanation of the findings, actuarial
justifications, and rationale that are the basis for the
decision. Any company whose rate has been modified or
disapproved shall be allowed to request a hearing within 10
days after the action taken. The action of the Director in
disapproving a rate shall be subject to judicial review under
the Administrative Review Law.
(g) If, following the issuance of a decision but before
the effective date of the premium rates approved by the
decision, an event occurs that materially affects the
Director's decision to approve, deny, or modify the rates, the
Director may consider supplemental facts or data reasonably
related to the event.
(h) The Department shall adopt rules implementing the
procedures described in subsections (d) through (g) by March
31, 2024.
(i) Subsection (a) and subsections (c) through (h) of this
Section do not apply to grandfathered health plans as defined
in 45 CFR 147.140; excepted benefits as defined in 42 U.S.C.
300gg-91; student health insurance coverage as defined in 45
CFR 147.145; the large group market as defined in Section 5 of
the Illinois Health Insurance Portability and Accountability
Act; or short-term, limited-duration health insurance coverage
as defined in Section 5 of the Short-Term, Limited-Duration

Health Insurance Coverage Act. For a filing of premium rates
or classifications of risk for any of these types of coverage,
the Director's initial review period shall not exceed 60 days
to issue informal objections to the company that request
additional clarification, explanation, substantiating
documentation, or correction of concerns identified in the
filing before the company implements the premium rates,
classifications, or related rate-setting methodologies
described in the filing, except that the Director may extend
by not more than an additional 30 days the period of initial
review by giving written notice to the company of such
extension before the expiration of the initial 60-day period.
Nothing in this subsection shall confer authority upon the
Director to approve, modify, or disapprove rates where that
authority is not provided by other law. Nothing in this
subsection shall prohibit the Director from conducting any
investigation, examination, hearing, or other formal
administrative or enforcement proceeding with respect to a
company's rate filing or implementation thereof under
applicable law at any time, including after the period of
initial review.
(Source: P.A. 79-777.)
Section 15. The Health Maintenance Organization Act is
amended by changing Section 4-12 as follows:

(215 ILCS 125/4-12) (from Ch. 111 1/2, par. 1409.5)
Sec. 4-12. Changes in Rate Methodology and Benefits,
Material Modifications. A health maintenance organization
shall file with the Director, prior to use, a notice of any
change in rate methodology, or benefits and of any material
modification of any matter or document furnished pursuant to
Section 2-1, together with such supporting documents as are
necessary to fully explain the change or modification.
(a) Contract modifications described in subsections
(c)(5), (c)(6) and (c)(7) of Section 2-1 shall include all
form agreements between the organization and enrollees,
providers, administrators of services and insurers of health
maintenance organizations.
(b) Material transactions or series of transactions other
than those described in subsection (a) of this Section, the
total annual value of which exceeds the greater of $100,000 or
5% of net earned subscription revenue for the most current
12-month twelve month period as determined from filed
financial statements.
(c) Any agreement between the organization and an insurer
shall be subject to the provisions of the laws of this State
regarding reinsurance as provided in Article XI of the
Illinois Insurance Code. All reinsurance agreements must be
filed. Approval of the Director is required for all agreements
except the following: individual stop loss, aggregate excess,
hospitalization benefits or out-of-area of the participating

providers unless 20% or more of the organization's total risk
is reinsured, in which case all reinsurance agreements require
approval.
(d) In addition to any applicable provisions of this Act,
premium rate filings shall be subject to subsections (a) and
(c) through (i) of Section 355 of the Illinois Insurance Code.
(Source: P.A. 86-620.)
Section 20. The Limited Health Service Organization Act is
amended by changing Section 3006 as follows:
(215 ILCS 130/3006) (from Ch. 73, par. 1503-6)
Sec. 3006. Changes in rate methodology and benefits;
material modifications; addition of limited health services.
(a) A limited health service organization shall file with
the Director prior to use, a notice of any change in rate
methodology, charges or benefits and of any material
modification of any matter or document furnished pursuant to
Section 2001, together with such supporting documents as are
necessary to fully explain the change or modification.
(1) Contract modifications described in paragraphs (5)
and (6) of subsection (c) of Section 2001 shall include
all agreements between the organization and enrollees,
providers, administrators of services and insurers of
limited health services; also other material transactions
or series of transactions, the total annual value of which

exceeds the greater of $100,000 or 5% of net earned
subscription revenue for the most current 12 month period
as determined from filed financial statements.
(2) Contract modification for reinsurance. Any
agreement between the organization and an insurer shall be
subject to the provisions of Article XI of the Illinois
Insurance Code, as now or hereafter amended. All
reinsurance agreements must be filed with the Director.
Approval of the Director in required agreements must be
filed. Approval of the director is required for all
agreements except individual stop loss, aggregate excess,
hospitalization benefits or out-of-area of the
participating providers, unless 20% or more of the
organization's total risk is reinsured, in which case all
reinsurance agreements shall require approval.
(b) If a limited health service organization desires to
add one or more additional limited health services, it shall
file a notice with the Director and, at the same time, submit
the information required by Section 2001 if different from
that filed with the prepaid limited health service
organization's application. Issuance of such an amended
certificate of authority shall be subject to the conditions of
Section 2002 of this Act.
(c) In addition to any applicable provisions of this Act,
premium rate filings shall be subject to subsection (i) of
Section 355 of the Illinois Insurance Code.

(Source: P.A. 86-600.)