2023 Illinois Compiled Statutes › Chapter 215 - INSURANCE › 215 ILCS 130/ - Limited Health Service Organization Act. › Article 3 - Delivery Of Services; Required Provisions And Marketing

(215 ILCS 130/Art. 3 heading)
ARTICLE 3.  
		DELIVERY OF SERVICES; REQUIRED
PROVISIONS AND MARKETING
(215 ILCS 130/3001) (from Ch. 73, par. 1503-1)
Sec. 3001. 
		Description and securing of services. 
		The limited health service organization shall issue to each subscriber or
enrollee a group contract or evidence of coverage.  Any such group contract
or evidence of coverage shall provide for the rendering of limited health
services as defined therein for a period of 12 months from the date of
issuance; and shall provide that it shall be renewed from year to year
unless there has been 31 days written notice of termination prior to the
annual renewal of the contract by the subscriber, enrollee or the limited
health service organization.  The group contract, evidence of coverage and
related material shall be delivered or issued for delivery to an enrollee
within 30 days from the later of the effective date of coverage or the date
on which the limited health service organization is notified of enrollment.
(Source: P.A. 86-600.)
(215 ILCS 130/3002) (from Ch. 73, par. 1503-2)
Sec. 3002. 
		Complaint system. 
		Every limited health service organization
shall establish and maintain a complaint system providing reasonable
procedures for resolving complaints initiated by enrollees.  Nothing herein
shall be construed to preclude an enrollee or a provider from filing a
complaint with the Director or as limiting the Director's ability to
investigate such complaints.
(Source: P.A. 86-600.)
(215 ILCS 130/3003) (from Ch. 73, par. 1503-3)
Sec. 3003. 
		Department complaint handling procedure. 
		(a) When a complaint is received by the Department of Insurance
(Department) against a limited health service organization (respondent) or
producer (respondent), the respondent shall be notified of the complaint.
The Department in its notification shall specify the date when a report is
to be received from the respondent, which shall be no later than 21 days
after notification is sent to the respondent.  A failure to reply by the
date specified may be followed by a collect telephone call or collect
telegram.  Repeated instances of failing to reply by the date specified may
result in further regulatory action.
(b) Contents of response or report.
(1) Each respondent shall supply adequate     documentation which explains all actions taken or not taken and which were the basis for the complaint.
(2) Documents necessary to support the respondent's     position and information requested by the Department, shall be furnished with the respondent's reply.
(3) The respondent's reply shall be duplicate, but     duplicate copies of supporting documents shall not be required.
(4) The respondent's reply shall include the name,     telephone number and address of the individual assigned to the complaint.
(5) The Department shall respect the confidentiality     of medical reports and other documents which by law are confidential. Any other information furnished by a respondent shall be marked "confidential" if the respondent does not wish it to be released to the complainant.
(c) Follow-up conclusion. Upon receipt of the respondent's report, the
investigating deputy shall evaluate the material submitted; and
(1) advise the complainant of the action taken and     disposition of his complaint;
(2) pursue further investigation with respondent or     complainant; or
(3) refer the investigation report to the appropriate     unit within the Department of Insurance for further regulatory action.
(Source: P.A. 86-600.)
(215 ILCS 130/3004) (from Ch. 73, par. 1503-4)
Sec. 3004. 
		Solicitations of enrollees. 
		(a) Solicitations of enrollees by a
limited health service organization authorized under this Act, or its
representatives shall not be construed to be violative of any provisions
of law relating to solicitation or advertising by health professionals.
Nothing in this Section precludes a limited health service organization
from providing to a particular potential enrollee the names of health
providers. No limited health service organization, or representative
thereof, may cause or knowingly permit the use of advertising which is
untrue or misleading, solicitation which is untrue or misleading or any
form of evidence of coverage which is deceptive. Limited health service
organizations shall be subject to Section 143c or the Illinois Insurance
Code as now or hereafter amended.
(b) If the Director finds that any advertisement of a plan has materially
failed to comply with the provisions of this Act or the rules hereunder,
the Director may, by order, require the plan to publish in the same or
similar medium, an approved correction or retraction of any untrue,
misleading or deceptive statement contained in the advertising and may
prohibit such plan from publishing, distributing or allowing to be
published or distributed on its behalf such advertisement or any new
materially revised advertisement without first having filed a copy thereof
with the Director 30 days prior to the publication or distribution thereof,
or any shorter period specified in such order. An order issued under this
Section shall be effective for 12 months from its issuance and may be
renewed by order if the advertisements submitted under this Section
indicate difficulties of voluntary compliance with the applicable
provisions of this Act and the rules hereunder.
(Source: P.A. 86-600.)
(215 ILCS 130/3005) (from Ch. 73, par. 1503-5)
Sec. 3005. 
		Producers. 
		No person may apply, procure, solicit,
negotiate, or place for others any evidence of coverage of a limited health
service organization unless that person holds a valid limited insurance
representative license or producers license to sell accident and health
insurance policies pursuant to Article XXXI of the Illinois Insurance Code,
as now and hereafter amended.
(Source: P.A. 86-600.)
(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. 103-106, eff. 1-1-24.)
(215 ILCS 130/3007) (from Ch. 73, par. 1503-7)
Sec. 3007. 
		Prior approval of policy forms.
(a) No limited health
service organization shall issue or deliver, in this State, a group
contract or evidence of coverage, attach an endorsement or rider thereto,
incorporate by reference, bylaws or other matter therein or use an
application blank in this State until the form and content of such group
contract or evidence of coverage, endorsement, rider, bylaw or other matter
incorporated by reference or application blank has been filed with and
approved by the Director and, provided further, except that any such
endorsement or rider which is to be attached to a group contract or
evidence of coverage subsequent to the date the group contract or evidence
of coverage is issued must be filed with, reviewed and approved by the
Director prior to the date it is attached to a group contract or evidence
of coverage issued or delivered in this State.  The Director shall withhold
approval of any such group contract, evidence of coverage, endorsement,
rider, bylaw or other matter incorporated by reference or application blank
if it contains provisions which may encourage misrepresentation or are
unjust, unfair,  inequitable, ambiguous, misleading, inconsistent,
deceptive, contrary to law or to the public policy of this State, or
contains exceptions and conditions that unreasonably or deceptively affect
the risk purported to be assumed in the general coverage of the group
contract or evidence of coverage.  In all cases the Director shall approve
or disapprove any such form within 60 days after submission unless the
Director extends, by not more than an additional 30 days, the period within
which he shall approve or disapprove any such form by giving written notice
to the organization of such extension before expiration of the initial 60
day period.  The Director shall withdraw his approval of a group contract
or evidence of coverage, endorsement rider, bylaw or other matter
incorporated by reference or application blank if he subsequently
determines that such group contract or evidence of coverage, endorsement,
rider, bylaw, other matter incorporated by reference or
application blank is misrepresentative, unjust, unfair, unequitable,
ambiguous, misleading, inconsistent, deceptive, contrary to law or public
policy of this State, or contains exceptions or conditions which
unreasonably or deceptively affect the risk purported to be assumed in the
general coverage of the group contract or evidence of coverage.
(b) If a previously approved group contract or evidence of coverage,
endorsement, rider, bylaw or other matter incorporated by reference or
application blank is withdrawn from use, the Director shall serve upon the
company an order of withdrawal of use, either personally or by mail, and if
by mail, such service shall be completed if such notice is deposited in the
post office, postage prepaid, addressed to the limited health service
organization's last known address specified in the records of the
Department of Insurance.  The order of withdrawal of use shall take effect
30 days from the date of mailing, but shall be stayed if within the 30 day
period a written request for hearing is filed with the Director.  Such
hearing shall be held at such time and place as designated in the order
given by the Director.  The hearing may be held either in the City of
Springfield, the City of Chicago or in the county where the principal
business address of the limited health service organization is located.
The action of the Director in disapproving or withdrawing such form shall
be subject to judicial review under the Administrative Review Law, as now or
hereafter amended.
(Source: P.A. 86-600.)
(215 ILCS 130/3008) (from Ch. 73, par. 1503-8)
Sec. 3008. 
		Evidence of coverage. 
		(a) Every subscriber shall be issued
an evidence of coverage, which shall contain a clear and complete statement of:
(1) The limited health services to which each     enrollee is entitled.
(2) Eligibility requirements indicating the     conditions which must be met to enroll in a limited health care plan.
(3) Any limitation of the services or benefits to be     provided, and exclusions, including any copayment, or other charges.
(4) The terms or conditions upon which coverage may     be cancelled or otherwise terminated.
(5) Where and in what manner information is available     as to where and how services may be obtained.
(6) The method for resolving complaints.
(b) Any amendment to the evidence of coverage may be provided to the
subscriber in a separate document.
(Source: P.A. 86-600.)
(215 ILCS 130/3009) (from Ch. 73, par. 1503-9)
Sec. 3009. 
		Point-of-service limited health service contracts.
(a) An LHSO that offers a POS contract:
(1) shall include as in-plan covered services all     services required by law to be provided by an LHSO;
(2) shall provide incentives, which shall include     financial incentives, for enrollees to use in-plan covered services;
(3) shall not offer services out-of-plan without     providing those services on an in-plan basis;
(4) may limit or exclude specific types of services     from coverage when obtained out-of-plan;
(5) may include annual out-of-pocket limits and     lifetime maximum benefits allowances for out-of-plan services that are separate from any limits or allowances applied to in-plan services;
(6) shall include an annual maximum benefit allowance     not to exceed $2,500 per year that is separate from any limits or allowances applied to in-plan services;
(7) may limit the groups to which a POS product is     offered, however, if a POS product is offered to a group, then it must be offered to all eligible members of that group, when an LHSO provider is available;
(8) shall not consider emergency services, authorized     referral services, or non-routine services obtained out of the service area to be POS services; and
(9) may treat as out-of-plan services those services     that an enrollee obtains from a participating provider, but for which the proper authorization was not given by the LHSO.
(b) An LHSO offering a POS contract shall be subject to the following
limitations:
(1) The LHSO shall not expend in any calendar quarter     more than 20% of its total limited health services expenditures for all its members for out-of-plan covered services.
(2) If the amount specified in paragraph (1) is     exceeded by 2% in a quarter, the LHSO shall effect compliance with paragraph (1) by the end of the following quarter.
(3) If compliance with the amount specified in     paragraph (1) is not demonstrated in the LHSO's next quarterly report, the LHSO may not offer the POS contract to new groups or include the POS option in the renewal of an existing group until compliance with the amount specified in paragraph (1) is demonstrated or otherwise allowed by the Director.
(4) Any LHSO failing, without just cause, to comply     with the provisions of this subsection shall be required, after notice and hearing, to pay a penalty of $250 for each day out of compliance, to be recovered by the Director of Insurance.  Any penalty recovered shall be paid into the General Revenue Fund.  The Director may reduce the penalty if the LHSO demonstrates to the Director that the imposition of the penalty would constitute a financial hardship to the LHSO.
(c) Any LHSO that offers a POS product shall:
(1) File a quarterly financial statement detailing     compliance with the requirements of subsection (b).
(2) Track out-of-plan POS utilization separately from     in-plan or non-POS out-of-plan emergency care, referral care, and urgent care out of the service area utilization.
(3) Record out-of-plan utilization in a manner that     will permit such utilization and cost reporting as the Director may, by regulation, require.
(4) Demonstrate to the Director's satisfaction that     the LHSO has the fiscal, administrative, and marketing capacity to control its POS enrollment, utilization, and costs so as not to jeopardize the financial security of the LHSO.
(5) Maintain the deposit required by subsection (b)     of Section 2006 in addition to any other deposit required under this Act.
(d) An LHSO shall not issue a POS contract until it has filed and had
approved by the Director a plan to comply with the provisions of this
Section.  The compliance plan shall at a minimum include provisions
demonstrating that the LHSO will do all of the following:
(1) Design the benefit levels and conditions of     coverage for in-plan covered services and out-of-plan covered services as required by this Article.
(2) Provide or arrange for the provision of adequate     systems to:
(A) process and pay claims for all out-of-plan         covered services;
(B) meet the requirements for a POS contract set         forth in this Section and any additional requirements that may be set forth by the Director; and
(C) generate accurate data and financial and         regulatory reports on a timely basis so that the Department can evaluate the LHSO's experience with the POS contract and monitor compliance with POS contract provisions.
(3) Comply initially and on an ongoing basis with the     requirements of subsections (b) and (c).
(e) A limited health service organization that offers a POS contract must
comply with Sections 356w and 356x of the Illinois Insurance Code.
(Source: P.A. 90-741, eff. 1-1-99.)
(215 ILCS 130/3010)
Sec. 3010. Purchase of ophthalmic goods or services. An organization may not require a provider, as a condition of participation in the organization's limited health care plan, to purchase ophthalmic goods or services, including but not limited to eyeglass frames, in a quantity or dollar amount in excess of the quantity or dollar amount an enrollee purchases under the terms of the limited health care plan.
(Source: P.A. 93-1077, eff. 1-18-05.)