Bill Text: IL HB4475 | 2023-2024 | 103rd General Assembly | Engrossed

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Bill Title: Reinserts the provisions of the bill, as amended by House Amendment No. 1, with the following changes. Provides that for all group or individual policies of accident and health insurance or managed care plans that are amended, delivered, issued, or renewed on or after January 1, 2026, or any contracted third party administering the behavioral health benefits for the insurer, reimbursement for in-network mental health and substance use disorder treatment services delivered by Illinois providers and facilities must be equal to or greater than 141% of the Medicare rate for the mental health or substance use disorder service delivered (rather than on average, at least as favorable as professional services provided by in-network primary care providers). Removes language providing that reimbursement rates for services paid to Illinois mental health and substance use disorder treatment providers and facilities do not meet the required standard unless the reimbursement rates are, on average, equal to or greater than 141% of the Medicare reimbursement rate for the same service. Provides that, if the Department of Insurance determines that an insurer or a contracted third party administering the behavioral health benefits for the insurer has violated a provision concerning mental health and substance use parity, the Department shall by order assess a civil penalty of $1,000 (rather than $5,000) for each violation. Excludes health care plans serving Medicaid populations that provide, arrange for, pay for, or reimburse the cost of any health care service for persons who are enrolled under the Illinois Public Aid Code or under the Children's Health Insurance Program Act from provisions concerning mental health and substance use parity. Makes other changes. Effective immediately.

Spectrum: Strong Partisan Bill (Democrat 54-3)

Status: (Engrossed) 2024-12-09 - Added as Alternate Chief Co-Sponsor Sen. Mary Edly-Allen [HB4475 Detail]

Download: Illinois-2023-HB4475-Engrossed.html

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HB4475 Engrossed LRB103 36234 RPS 66329 b
AN ACT concerning regulation.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 1. This Act may be referred to as the
Strengthening Mental Health and Substance Use Parity Act.
Section 2. Purpose. The purpose of this Act is to improve
mental health and substance use parity, specifically
addressing network adequacy and nonquantitative treatment
limitations that restrict access to care.
Section 3. Findings. The General Assembly finds that:
(1) A 2021 U.S. Surgeon General Advisory, Protecting Youth
Mental Health, reported the COVID-19 pandemic's devastating
impact on youth and family mental health:
(A) One in 3 high school students reported persistent
feelings of hopelessness and sadness in 2019.
(B) Rates of depression and anxiety for youth doubled
during the pandemic.
(C) Black children under 13 are nearly twice as likely
to die by suicide than white children.
(2) According to a bipartisan U.S. Senate Finance
Committee report on Mental Health Care in the United States,
symptoms for depression and anxiety in adults increased nearly

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four-fold during the pandemic.
(3) In 2020, 2,944 Illinoisans lost their lives to an
opioid overdose according to the Illinois Department of Public
Health.
(4) Discriminatory commercial insurance practices that do
not live up to the federal Mental Health Parity and Addiction
Equity Act (MHPAEA) and Illinois' parity laws, specifically
regarding insurance network adequacy, severely limit access to
care.
(5) Commercial insurance practices disincentivize mental
health and substance use treatment providers from
participating in insurance networks by erecting significant
administrative barriers and by reimbursing providers far below
the reimbursement of other health care providers despite a
behavioral health workforce crisis.
(A) Such practices lead to restrictive, narrow
insurance networks that restrict access care.
(B) 26% of psychiatrists do not participate in
insurance networks, according to a report in JAMA
Psychiatry.
(C) 21% of psychologists do not participate in
insurance networks, according to a 2015 American
Psychological Association Survey.
(D) A significant percentage of behavioral health
providers do not contract with insurers, leaving patients
to see out-of-network providers.

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(E) Out-of-network treatment is far more expensive for
the patient than in-network care.
(F) Mental health and substance use treatment is
inaccessible and unaffordable for millions of Illinoisans
for these reasons.
(6) A recent Milliman report analyzing insurance claims
for 37,000,000 Americans, including Illinois residents, found
major disparities in out-of-network utilization for behavioral
health compared to other health care. The report's findings
include:
(A) Illinois out-of-network behavioral health
utilization was 18.2% for outpatient services in 2017
compared to just 3.9% for medical/surgical services.
(B) Illinois out-of-network behavioral health
utilization was 12.1% in 2017 for inpatient care compared
to just 2.8% for medical/surgical.
(C) The disparity between out-of-network usage for
behavioral health compared to medical/surgical services
grew significantly between 2013 and 2017: Out-of-network
behavioral health utilization for outpatient visits grew
by 44%, while out-of-network utilization for
medical/surgical services decreased by 42% over the same
period in Illinois.
(D) Nearly 14% of behavioral health office visits for
individuals with a preferred provider organization plan
were out-of-network in Illinois.

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(7) Mental health and substance use care, which represents
just 5.2% of all health care spending, does not drive up
premiums.
(8) Improved access to behavioral health care is expected
to reduce overall health care spending because:
(A) spending on physical health care is 2 to 3 times
higher for patients with ongoing mental health and
substance use diagnoses, according to a 2018 Milliman
research report; and
(B) improved utilization of mental health services has
been demonstrated empirically to reduce overall health
care spending (Biu, Yoon, & Hines, 2021).
(9) Illinois must strengthen its parity laws to prevent
insurance practices that restrict access to mental health and
substance use care.
Section 10. The Illinois Insurance Code is amended by
adding Section 370c.3 as follows:
(215 ILCS 5/370c.3 new)
Sec. 370c.3. Mental health and substance use parity.
(a) In this Section:
"Application" means a person's or facility's application
to become a participating provider with an insurer in at least
one of the insurer's provider networks.
"Applying provider" means a provider or facility that has

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submitted a completed application to become a participating
provider or facility with an insurer.
"Behavioral health trainee" means any person: (1) engaged
in the provision of mental health or substance use disorder
clinical services as part of that person's supervised course
of study while enrolled in a master's or doctoral psychology,
social work, counseling, or marriage or family therapy program
or as a postdoctoral graduate working toward licensure; and
(2) who is working toward clinical State licensure under the
clinical supervision of a fully licensed mental health or
substance use disorder treatment provider.
"Completed application" means a person's or facility's
application to become a participating provider that has been
submitted to the insurer and includes all the required
information for the application to be considered by the
insurer according to the insurer's policies and procedures for
verifying a provider's or facility's credentials.
"Contracting process" means the process by which a mental
health or substance use disorder treatment provider or
facility makes a completed application with an insurer to
become a participating provider with the insurer until the
effective date of a final contract between the provider or
facility and the insurer. "Contracting process" includes the
process of verifying a provider's credentials.
"Participating provider" means any mental health or
substance use disorder treatment provider that has a contract

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to provide mental health or substance use disorder services
with an insurer.
(b) For all group or individual policies of accident and
health insurance or managed care plans that are amended,
delivered, issued, or renewed on or after January 1, 2026, or
any contracted third party administering the behavioral health
benefits for the insurer, reimbursement for in-network mental
health and substance use disorder treatment services delivered
by Illinois providers and facilities must be equal to or
greater than 141% of the Medicare rate for the mental health or
substance use disorder service delivered. For services not
covered by Medicare, the reimbursement rates must be, on
average, equal to or greater than 144% of the insurer's
in-network reimbursement rate for such service on the
effective date of this amendatory Act of the 103rd General
Assembly. This Section applies to all covered office,
outpatient, inpatient, and residential mental health and
substance use disorder services.
(c) A group or individual policy of accident and health
insurance or managed care plan that is amended, delivered,
issued, or renewed on or after January 1, 2025, or contracted
third party administering the behavioral health benefits for
the insurer, shall cover all medically necessary mental health
or substance use disorder services received by the same
insured on the same day from the same or different mental
health or substance use provider or facility for both

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outpatient and inpatient care.
(d) A group or individual policy of accident and health
insurance or managed care plan that is amended, delivered,
issued, or renewed on or after January 1, 2025, or any
contracted third party administering the behavioral health
benefits for the insurer, shall cover any medically necessary
mental health or substance use disorder service provided by a
behavioral health trainee when the trainee is working toward
clinical State licensure and is under the supervision of a
fully licensed mental health or substance use disorder
treatment provider, which is a physician licensed to practice
medicine in all its branches, licensed clinical psychologist,
licensed clinical social worker, licensed clinical
professional counselor, licensed marriage and family
therapist, licensed speech-language pathologist, or other
licensed or certified professional at a program licensed
pursuant to the Substance Use Disorder Act who is engaged in
treating mental, emotional, nervous, or substance use
disorders or conditions. Services provided by the trainee must
be billed under the supervising clinician's rendering National
Provider Identifier.
(e) A group or individual policy of accident and health
insurance or managed care plan that is amended, delivered,
issued, or renewed on or after January 1, 2025, or any
contracted third party administering the behavioral health
benefits for the insurer, shall:

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(1) cover medically necessary 60-minute psychotherapy
billed using the CPT Code 90837 for Individual Therapy;
(2) not impose more onerous documentation requirements
on the provider than is required for other psychotherapy
CPT Codes; and
(3) not audit the use of CPT Code 90837 any more
frequently than audits for the use of other psychotherapy
CPT Codes.
(f)(1) Any group or individual policy of accident and
health insurance or managed care plan that is amended,
delivered, issued, or renewed on or after January 1, 2026, or
any contracted third party administering the behavioral health
benefits for the insurer, shall complete the contracting
process with a mental health or substance use disorder
treatment provider or facility for becoming a participating
provider in the insurer's network, including the verification
of the provider's credentials, within 60 days from the date of
a completed application to the insurer to become a
participating provider. Nothing in this paragraph (1),
however, presumes or establishes a contract between an insurer
and a provider.
(2) Any group or individual policy of accident and health
insurance or managed care plan that is amended, delivered,
issued, or renewed on or after January 1, 2025, or any
contracted third party administering the behavioral health
benefits for the insurer, shall reimburse a participating

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mental health or substance use disorder treatment provider or
facility at the contracted reimbursement rate for any
medically necessary services provided to an insured from the
date of submission of the provider's or facility's completed
application to become a participating provider with the
insurer up to the effective date of the provider's contract.
The provider's claims for such services shall be reimbursed
only when submitted after the effective date of the provider's
contract with the insurer. This paragraph (2) does not apply
to a provider that does not have a completed contract with an
insurer. If a provider opts to submit claims for medically
necessary mental health or substance use disorder services
pursuant to this paragraph (2), the provider must notify the
insured following submission of the claims to the insurer that
the services provided to the insured may be treated as
in-network services.
(3) Any group or individual policy of accident and health
insurance or managed care plan that is amended, delivered,
issued, or renewed on or after January 1, 2025, or any
contracted third party administering the behavioral health
benefits for the insurer, shall cover any medically necessary
mental health or substance use disorder service provided by a
fully licensed mental health or substance use disorder
treatment provider affiliated with a mental health or
substance use disorder treatment group practice who has
submitted a completed application to become a participating

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provider with an insurer who is delivering services under the
supervision of another fully licensed participating mental
health or substance use disorder treatment provider within the
same group practice up to the effective date of the applying
provider's contract with the insurer as a participating
provider. Services provided by the applying provider must be
billed under the supervising licensed provider's rendering
National Provider Identifier.
(4) Upon request, an insurer, or any contracted third
party administering the behavioral health benefits for the
insurer, shall provide an applying provider with the insurer's
credentialing policies and procedures. An insurer, or any
contracted third party administering the behavioral health
benefits for the insurer, shall post the following
nonproprietary information on its website and make that
information available to all applicants:
(A) a list of the information required to be included
in an application;
(B) a checklist of the materials that must be
submitted in the credentialing process; and
(C) designated contact information of a network
representative, including a designated point of contact,
an email address, and a telephone number, to which an
applicant may address any credentialing inquiries.
(g) The Department has the same authority to enforce this
Section as it has to enforce compliance with Sections 370c and

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370c.1. Additionally, if the Department determines that an
insurer or a contracted third party administering the
behavioral health benefits for the insurer has violated this
Section, the Department shall, after appropriate notice and
opportunity for hearing in accordance with Section 402, by
order assess a civil penalty of $1,000 for each violation. The
Department shall establish any processes or procedures
necessary to monitor compliance with this Section.
(h) The Department shall adopt any rules necessary to
implement this Section by no later than May 1, 2025.
(i) This Section does not apply to a health care plan
serving Medicaid populations that provides, arranges for, pays
for, or reimburses the cost of any health care service for
persons who are enrolled under the Illinois Public Aid Code or
under the Children's Health Insurance Program Act.
Section 15. The Health Maintenance Organization Act is
amended by changing Section 5-3 as follows:
(215 ILCS 125/5-3) (from Ch. 111 1/2, par. 1411.2)
Sec. 5-3. Insurance Code provisions.
(a) Health Maintenance Organizations shall be subject to
the provisions of Sections 133, 134, 136, 137, 139, 140,
141.1, 141.2, 141.3, 143, 143c, 147, 148, 149, 151, 152, 153,
154, 154.5, 154.6, 154.7, 154.8, 155.04, 155.22a, 155.49,
355.2, 355.3, 355b, 355c, 356f, 356g.5-1, 356m, 356q, 356v,

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356w, 356x, 356z.2, 356z.3a, 356z.4, 356z.4a, 356z.5, 356z.6,
356z.8, 356z.9, 356z.10, 356z.11, 356z.12, 356z.13, 356z.14,
356z.15, 356z.17, 356z.18, 356z.19, 356z.20, 356z.21, 356z.22,
356z.23, 356z.24, 356z.25, 356z.26, 356z.28, 356z.29, 356z.30,
356z.30a, 356z.31, 356z.32, 356z.33, 356z.34, 356z.35,
356z.36, 356z.37, 356z.38, 356z.39, 356z.40, 356z.41, 356z.44,
356z.45, 356z.46, 356z.47, 356z.48, 356z.49, 356z.50, 356z.51,
356z.53, 356z.54, 356z.55, 356z.56, 356z.57, 356z.58, 356z.59,
356z.60, 356z.61, 356z.62, 356z.64, 356z.65, 356z.67, 356z.68,
364, 364.01, 364.3, 367.2, 367.2-5, 367i, 368a, 368b, 368c,
368d, 368e, 370c, 370c.3, 370c.1, 401, 401.1, 402, 403, 403A,
408, 408.2, 409, 412, 444, and 444.1, paragraph (c) of
subsection (2) of Section 367, and Articles IIA, VIII 1/2,
XII, XII 1/2, XIII, XIII 1/2, XXV, XXVI, and XXXIIB of the
Illinois Insurance Code.
(b) For purposes of the Illinois Insurance Code, except
for Sections 444 and 444.1 and Articles XIII and XIII 1/2,
Health Maintenance Organizations in the following categories
are deemed to be "domestic companies":
(1) a corporation authorized under the Dental Service
Plan Act or the Voluntary Health Services Plans Act;
(2) a corporation organized under the laws of this
State; or
(3) a corporation organized under the laws of another
state, 30% or more of the enrollees of which are residents
of this State, except a corporation subject to

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substantially the same requirements in its state of
organization as is a "domestic company" under Article VIII
1/2 of the Illinois Insurance Code.
(c) In considering the merger, consolidation, or other
acquisition of control of a Health Maintenance Organization
pursuant to Article VIII 1/2 of the Illinois Insurance Code,
(1) the Director shall give primary consideration to
the continuation of benefits to enrollees and the
financial conditions of the acquired Health Maintenance
Organization after the merger, consolidation, or other
acquisition of control takes effect;
(2)(i) the criteria specified in subsection (1)(b) of
Section 131.8 of the Illinois Insurance Code shall not
apply and (ii) the Director, in making his determination
with respect to the merger, consolidation, or other
acquisition of control, need not take into account the
effect on competition of the merger, consolidation, or
other acquisition of control;
(3) the Director shall have the power to require the
following information:
(A) certification by an independent actuary of the
adequacy of the reserves of the Health Maintenance
Organization sought to be acquired;
(B) pro forma financial statements reflecting the
combined balance sheets of the acquiring company and
the Health Maintenance Organization sought to be

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acquired as of the end of the preceding year and as of
a date 90 days prior to the acquisition, as well as pro
forma financial statements reflecting projected
combined operation for a period of 2 years;
(C) a pro forma business plan detailing an
acquiring party's plans with respect to the operation
of the Health Maintenance Organization sought to be
acquired for a period of not less than 3 years; and
(D) such other information as the Director shall
require.
(d) The provisions of Article VIII 1/2 of the Illinois
Insurance Code and this Section 5-3 shall apply to the sale by
any health maintenance organization of greater than 10% of its
enrollee population (including, without limitation, the health
maintenance organization's right, title, and interest in and
to its health care certificates).
(e) In considering any management contract or service
agreement subject to Section 141.1 of the Illinois Insurance
Code, the Director (i) shall, in addition to the criteria
specified in Section 141.2 of the Illinois Insurance Code,
take into account the effect of the management contract or
service agreement on the continuation of benefits to enrollees
and the financial condition of the health maintenance
organization to be managed or serviced, and (ii) need not take
into account the effect of the management contract or service
agreement on competition.

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(f) Except for small employer groups as defined in the
Small Employer Rating, Renewability and Portability Health
Insurance Act and except for medicare supplement policies as
defined in Section 363 of the Illinois Insurance Code, a
Health Maintenance Organization may by contract agree with a
group or other enrollment unit to effect refunds or charge
additional premiums under the following terms and conditions:
(i) the amount of, and other terms and conditions with
respect to, the refund or additional premium are set forth
in the group or enrollment unit contract agreed in advance
of the period for which a refund is to be paid or
additional premium is to be charged (which period shall
not be less than one year); and
(ii) the amount of the refund or additional premium
shall not exceed 20% of the Health Maintenance
Organization's profitable or unprofitable experience with
respect to the group or other enrollment unit for the
period (and, for purposes of a refund or additional
premium, the profitable or unprofitable experience shall
be calculated taking into account a pro rata share of the
Health Maintenance Organization's administrative and
marketing expenses, but shall not include any refund to be
made or additional premium to be paid pursuant to this
subsection (f)). The Health Maintenance Organization and
the group or enrollment unit may agree that the profitable
or unprofitable experience may be calculated taking into

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account the refund period and the immediately preceding 2
plan years.
The Health Maintenance Organization shall include a
statement in the evidence of coverage issued to each enrollee
describing the possibility of a refund or additional premium,
and upon request of any group or enrollment unit, provide to
the group or enrollment unit a description of the method used
to calculate (1) the Health Maintenance Organization's
profitable experience with respect to the group or enrollment
unit and the resulting refund to the group or enrollment unit
or (2) the Health Maintenance Organization's unprofitable
experience with respect to the group or enrollment unit and
the resulting additional premium to be paid by the group or
enrollment unit.
In no event shall the Illinois Health Maintenance
Organization Guaranty Association be liable to pay any
contractual obligation of an insolvent organization to pay any
refund authorized under this Section.
(g) Rulemaking authority to implement Public Act 95-1045,
if any, is conditioned on the rules being adopted in
accordance with all provisions of the Illinois Administrative
Procedure Act and all rules and procedures of the Joint
Committee on Administrative Rules; any purported rule not so
adopted, for whatever reason, is unauthorized.
(Source: P.A. 102-30, eff. 1-1-22; 102-34, eff. 6-25-21;
102-203, eff. 1-1-22; 102-306, eff. 1-1-22; 102-443, eff.

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1-1-22; 102-589, eff. 1-1-22; 102-642, eff. 1-1-22; 102-665,
eff. 10-8-21; 102-731, eff. 1-1-23; 102-775, eff. 5-13-22;
102-804, eff. 1-1-23; 102-813, eff. 5-13-22; 102-816, eff.
1-1-23; 102-860, eff. 1-1-23; 102-901, eff. 7-1-22; 102-1093,
eff. 1-1-23; 102-1117, eff. 1-13-23; 103-84, eff. 1-1-24;
103-91, eff. 1-1-24; 103-123, eff. 1-1-24; 103-154, eff.
6-30-23; 103-420, eff. 1-1-24; 103-426, eff. 8-4-23; 103-445,
eff. 1-1-24; 103-551, eff. 8-11-23; revised 8-29-23.)