Current through Register Vol. 48, No. 12, March 22, 2024
a) Agreements or
Contracts
1) All sample agreements or
contracts, with variable language bracketed, under which any person is
delegated management duties or control of the HMO or that transfer a
substantial part of any major function of the HMO, including, but not limited
to, all reinsurance treaties, all agreements with providers and all
administrative service contracts must be submitted to the Department of
Insurance and the HMO must file with the Department any contract amendments,
renewals, addendums thereto, or any change from those originally submitted and
any material modification to the application submitted pursuant to Section 1-2
of the Act [
215 ILCS 125/1-2 ]
including, but not limited to, extension of service area.
2) The Illinois Department of Public Health
shall also receive for review copies of all sample agreements with providers,
as well as any amendments, addendums or any change from those agreements
originally submitted.
3) On a
quarterly basis, each HMO must submit a list identifying any MCO with which the
HMO has a current contract. The list must contain the name, address and
telephone number of the MCO, as well as the name of its Administrator, and must
identify the bond or letter of credit issuer as required by subsection (d)(2),
along with the expiration date and principal dollar amount for the instrument.
The quarterly report shall be due at the Department within 10 days following
the end of each quarter.
4) All
types of written health care provider agreements must contain provisions under
which the provider shall provide, arrange for, or participate in the quality
assurance programs mandated by the Act [
215 ILCS
125/2-8(b) ], unless the Illinois
Department of Public Health certifies that those programs will be fully
implemented without any participation or action from the contracting
provider.
5) All provider
agreements shall provide for at least 60 days notice by the provider for
termination with cause, as defined in the provider agreement, and at least 90
days notice by the provider for termination without cause. The HMO must inform
the Department immediately of any known or intended termination, with or
without cause, of an MCO.
6)
Subscribers must receive notice from the HMO at least 60 days in advance of any
termination that would curtail or eliminate services to subscribers. However,
in the event that the HMO receives notice of less than 60 days from any
provider for termination of any contract that would curtail or eliminate
services to subscribers, the HMO must provide immediate notice to the
subscribers. The Notice shall include instructions regarding referrals which
have been issued and appointments which may be pending.
7) The contractual agreement between the
provider and the HMO must contain evidence that the provider has professional
liability insurance and that such insurance coverage is effective as of the
effective date of such contract. Furthermore, the contract must set forth that
the Provider will give at least 15 days advance notice of cancellation of such
insurance. In those instances in which the HMO will provide physician services
directly through employed physicians and not through contractual arrangement
with a provider, the HMO shall provide evidence to the Department that each
individual physician has professional liability insurance or that the HMO has
coverage on behalf of the employed physicians.
b) The Director must disapprove any provider
agreement if, at any time, he or she finds:
1) that the charges to the HMO are based on
factors unrelated to the value of providing services to the HMO;
2) that the contract will significantly
impact or threaten the financial viability of the HMO;
3) that the provider agreement would transfer
substantial control of the HMO or any powers vested in the board of directors,
by statute, articles of incorporation or bylaws, or substantially all of the
basic functions of the HMO management;
4) that the provider agreement contains
provisions contrary to the Illinois Insurance Code;
5) that the provider is or has been
affiliated directly or indirectly, through ownership, control, management,
reinsurance transactions or other insurance, or business relations with any
person or persons known to have been involved in the improper manipulation of
assets, accounts or reinsurance; or
6) that the provider agreement does not
contain the provisions required by subsections (d) and (e) of this
Section.
c) If the
Director disapproves of any provider agreement, notice of that action shall be
given to the HMO, listing the reasons for the disapproval in writing. The
Director shall grant any party to the provider agreement a hearing upon request
according to Article XXIV [ 215 ILCS 5 /Art. XXIV] of the Illinois Insurance
Code.
d) This subsection shall
apply to all HMO agreements with MCOs authorized to furnish health care
services, when the fees for furnishing, arranging or providing the health care
services are capitated.
1) All capitated MCO
agreements shall contain a provision that states that the MCO will submit, to
the HMO, copies of its quarterly financial statements, which shall include the
MCO's balance sheet and statements of income and cash flow within 45 days after
the end of each fiscal period. In addition, the HMOs shall require the MCO to
submit within 90 days after the end of the MCO's fiscal year copies of its
audited annual financial statements prepared in accordance with generally
accepted accounting principles if available. The Department, at its discretion,
may require the HMO to submit for inspection by the Department statements the
HMO has received from the MCO. This information shall be deemed confidential by
the Department.
2) All MCO
capitated agreements shall contain provisions requiring the disclosure of
language whereby the MCO agrees to fully cooperate with, and disclose all
relevant information requested by, the HMO's actuaries for the preparation of
their opinion in accordance with the Actuarial Standards Board Actuarial
Standards of Practice No. 16.
3)
All MCO capitated agreements shall contain provisions under which the HMO
acknowledges that, in the event of the MCO's insolvency, the HMO is secondarily
liable as the ultimate risk bearer for unpaid health care services rendered to
its enrollees.
e)
Beginning January 1, 2007, all capitated provider agreements between the HMO
and its capitated providers shall contain the following hold-harmless clause.
To the extent that any provider contract renewed or extended after December 31,
2007 fails to incorporate the hold-harmless clause, the clause shall be deemed
incorporated into those contracts by operation of law as of the date of the
renewal of execution.
"The provider agrees that in no event, including but not
limited to nonpayment by the HMO of amounts due the provider under this
contract, insolvency of the HMO or any breach of this contract by the HMO,
shall the provider or its assignees or subcontractors have a right to or seek
any type of payment from, bill, charge, collect a deposit from, or have any
recourse against, the enrollee, persons acting on the enrollee's behalf (other
than the HMO), the employer or group contract holder for services provided
pursuant to this contract; except for the payment of applicable co-payments or
deductibles for services covered by the organization or fees for services not
covered by the HMO. The requirements of this clause shall survive any
termination of this contract for services rendered prior to such termination,
regardless of the cause of such termination. The HMO's enrollees, the persons
acting on the enrollee's behalf (other than the HMO), and the employer or group
contract holder shall be third party beneficiaries of this clause. This clause
supersedes any oral or written agreement now existing or hereafter entered into
between the provider and the enrollee, persons acting on the enrollee's behalf
(other than the HMO) and the employer or group contract holder."
f) The procedure to be followed by
HMOs for extension of operations into additional counties in Illinois shall be
as follows:
1) Upon receipt of certification
by the Illinois Department of Public Health, the HMO shall submit a letter to
the Director amending its service area. This letter will indicate that all
subscription certificates, rates, provider agreements, and any other applicable
documents to be used to service the extended area are those previously filed
or, if not, new or revised documents will be submitted to the Department for
review.
2) Each such notification
for extension of operations shall be accompanied by a list of the counties in
which the HMO is authorized to operate prior to any requested extension of
service area.