Bill Text: IL SB1646 | 2011-2012 | 97th General Assembly | Introduced

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Bill Title: Amends the Illinois Insurance Code in the provision concerning group accident and health insurance to provide that no group policy may be issued or delivered without a provision that if an employee presents to an employer proof that the employee is covered under another accident and health insurance policy, then the employee may decline coverage by opting out of the group coverage and that the amount, if any, that would be charged to the employee if the employee were to participate in the group coverage shall be deducted from the premium for group coverage. Effective immediately.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Failed) 2013-01-08 - Session Sine Die [SB1646 Detail]

Download: Illinois-2011-SB1646-Introduced.html

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97TH GENERAL ASSEMBLY State of Illinois 2011 and 2012 SB1646 Introduced 2/9/2011, by Sen. Carole Pankau SYNOPSIS AS INTRODUCED:
215 ILCS 5/367 from Ch. 73, par. 979
Amends the Illinois Insurance Code in the provision concerning group accident and health insurance to provide that no group policy may be issued or delivered without a provision that if an employee presents to an employer proof that the employee is covered under another accident and health insurance policy, then the employee may decline coverage by opting out of the group coverage and that the amount, if any, that would be charged to the employee if the employee were to participate in the group coverage shall be deducted from the premium for group coverage. Effective immediately.
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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 Illinois Insurance Code is amended by
changing Section 367 as follows:
(215 ILCS 5/367) (from Ch. 73, par. 979)
Sec. 367. Group accident and health insurance.
(1) Group accident and health insurance is hereby declared
to be that form of accident and health insurance covering not
less than 2 employees, members, or employees of members,
written under a master policy issued to any governmental
corporation, unit, agency or department thereof, or to any
corporation, copartnership, individual employer, or to any
association upon application of an executive officer or trustee
of such association having a constitution or bylaws and formed
in good faith for purposes other than that of obtaining
insurance, where officers, members, employees, employees of
members or classes or department thereof, may be insured for
their individual benefit. In addition a group accident and
health policy may be written to insure any group which may be
insured under a group life insurance policy. The term
"employees" shall include the officers, managers and employees
of subsidiary or affiliated corporations, and the individual

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proprietors, partners and employees of affiliated individuals
and firms, when the business of such subsidiary or affiliated
corporations, firms or individuals, is controlled by a common
employer through stock ownership, contract or otherwise.
(2) Any insurance company authorized to write accident and
health insurance in this State shall have power to issue group
accident and health policies. No policy of group accident and
health insurance may be issued or delivered in this State
unless a copy of the form thereof shall have been filed with
the department and approved by it in accordance with Section
355, and it contains in substance those provisions contained in
Sections 357.1 through 357.30 as may be applicable to group
accident and health insurance and the following provisions:
(a) A provision that the policy, the application of the
employer, or executive officer or trustee of any
association, and the individual applications, if any, of
the employees, members or employees of members insured
shall constitute the entire contract between the parties,
and that all statements made by the employer, or the
executive officer or trustee, or by the individual
employees, members or employees of members shall (in the
absence of fraud) be deemed representations and not
warranties, and that no such statement shall be used in
defense to a claim under the policy, unless it is contained
in a written application.
(b) A provision that the insurer will issue to the

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employer, or to the executive officer or trustee of the
association, for delivery to the employee, member or
employee of a member, who is insured under such policy, an
individual certificate setting forth a statement as to the
insurance protection to which he is entitled and to whom
payable.
(c) A provision that to the group or class thereof
originally insured shall be added from time to time all new
employees of the employer, members of the association or
employees of members eligible to and applying for insurance
in such group or class.
(d) A provision that if an employee presents to an
employer proof that the employee is covered under another
accident and health insurance policy, then the employee may
decline coverage by opting out of the group coverage and
that the amount, if any, that would be charged to the
employee if the employee were to participate in the group
coverage shall be deducted from the premium for group
coverage.
(3) Anything in this code to the contrary notwithstanding,
any group accident and health policy may provide that all or
any portion of any indemnities provided by any such policy on
account of hospital, nursing, medical or surgical services,
may, at the insurer's option, be paid directly to the hospital
or person rendering such services; but the policy may not
require that the service be rendered by a particular hospital

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or person. Payment so made shall discharge the insurer's
obligation with respect to the amount of insurance so paid.
Nothing in this subsection (3) shall prohibit an insurer from
providing incentives for insureds to utilize the services of a
particular hospital or person.
(4) Special group policies may be issued to school
districts providing medical or hospital service, or both, for
pupils of the district injured while participating in any
athletic activity under the jurisdiction of or sponsored or
controlled by the district or the authorities of any school
thereof. The provisions of this Section governing the issuance
of group accident and health insurance shall, insofar as
applicable, control the issuance of such policies issued to
schools.
(5) No policy of group accident and health insurance may be
issued or delivered in this State unless it provides that upon
the death of the insured employee or group member the
dependents' coverage, if any, continues for a period of at
least 90 days subject to any other policy provisions relating
to termination of dependents' coverage.
(6) No group hospital policy covering miscellaneous
hospital expenses issued or delivered in this State shall
contain any exception or exclusion from coverage which would
preclude the payment of expenses incurred for the processing
and administration of blood and its components.
(7) No policy of group accident and health insurance,

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delivered in this State more than 120 days after the effective
day of the Section, which provides inpatient hospital coverage
for sicknesses shall exclude from such coverage the treatment
of alcoholism. This subsection shall not apply to a policy
which covers only specified sicknesses.
(8) No policy of group accident and health insurance, which
provides benefits for hospital or medical expenses based upon
the actual expenses incurred, issued or delivered in this State
shall contain any specific exception to coverage which would
preclude the payment of actual expenses incurred in the
examination and testing of a victim of an offense defined in
Sections 12-13 through 12-16 of the Criminal Code of 1961, or
an attempt to commit such offense, to establish that sexual
contact did occur or did not occur, and to establish the
presence or absence of sexually transmitted disease or
infection, and examination and treatment of injuries and trauma
sustained by the victim of such offense, arising out of the
offense. Every group policy of accident and health insurance
which specifically provides benefits for routine physical
examinations shall provide full coverage for expenses incurred
in the examination and testing of a victim of an offense
defined in Sections 12-13 through 12-16 of the Criminal Code of
1961, or an attempt to commit such offense, as set forth in
this Section. This subsection shall not apply to a policy which
covers hospital and medical expenses for specified illnesses
and injuries only.

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(9) For purposes of enabling the recovery of State funds,
any insurance carrier subject to this Section shall upon
reasonable demand by the Department of Public Health disclose
the names and identities of its insureds entitled to benefits
under this provision to the Department of Public Health
whenever the Department of Public Health has determined that it
has paid, or is about to pay, hospital or medical expenses for
which an insurance carrier is liable under this Section. All
information received by the Department of Public Health under
this provision shall be held on a confidential basis and shall
not be subject to subpoena and shall not be made public by the
Department of Public Health or used for any purpose other than
that authorized by this Section.
(10) Whenever the Department of Public Health finds that it
has paid all or part of any hospital or medical expenses which
an insurance carrier is obligated to pay under this Section,
the Department of Public Health shall be entitled to receive
reimbursement for its payments from such insurance carrier
provided that the Department of Public Health has notified the
insurance carrier of its claim before the carrier has paid the
benefits to its insureds or the insureds' assignees.
(11) (a) No group hospital, medical or surgical expense
policy shall contain any provision whereby benefits
otherwise payable thereunder are subject to reduction
solely on account of the existence of similar benefits
provided under other group or group-type accident and

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sickness insurance policies where such reduction would
operate to reduce total benefits payable under these
policies below an amount equal to 100% of total allowable
expenses provided under these policies.
(b) When dependents of insureds are covered under 2
policies, both of which contain coordination of benefits
provisions, benefits of the policy of the insured whose
birthday falls earlier in the year are determined before
those of the policy of the insured whose birthday falls
later in the year. Birthday, as used herein, refers only to
the month and day in a calendar year, not the year in which
the person was born. The Department of Insurance shall
promulgate rules defining the order of benefit
determination pursuant to this paragraph (b).
(12) Every group policy under this Section shall be subject
to the provisions of Sections 356g and 356n of this Code.
(13) No accident and health insurer providing coverage for
hospital or medical expenses on an expense incurred basis shall
deny reimbursement for an otherwise covered expense incurred
for any organ transplantation procedure solely on the basis
that such procedure is deemed experimental or investigational
unless supported by the determination of the Office of Health
Care Technology Assessment within the Agency for Health Care
Policy and Research within the federal Department of Health and
Human Services that such procedure is either experimental or
investigational or that there is insufficient data or

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experience to determine whether an organ transplantation
procedure is clinically acceptable. If an accident and health
insurer has made written request, or had one made on its behalf
by a national organization, for determination by the Office of
Health Care Technology Assessment within the Agency for Health
Care Policy and Research within the federal Department of
Health and Human Services as to whether a specific organ
transplantation procedure is clinically acceptable and said
organization fails to respond to such a request within a period
of 90 days, the failure to act may be deemed a determination
that the procedure is deemed to be experimental or
investigational.
(14) Whenever a claim for benefits by an insured under a
dental prepayment program is denied or reduced, based on the
review of x-ray films, such review must be performed by a
dentist.
(Source: P.A. 91-549, eff. 8-14-99.)
Section 99. Effective date. This Act takes effect upon
becoming law.