Article 4 - General Provisions - Illinois Statutes

      (215 ILCS 130/Art. 4 heading)ARTICLE 4. GENERAL PROVISIONS

(215 ILCS 130/4001) (from Ch. 73, par. 1504‑1)     Sec. 4001. Applicability of Section 155 of the Illinois Insurance Code to limited health service organizations. Section 155 of the Illinois Insurance Code, as now or hereafter amended, shall apply to limited health service organizations; except that no actions shall be brought for an unreasonable delay in the settling of a claim if the delay is caused by the failure of the enrollee to execute a lien as requested by the health care plan. (Source: P.A. 86‑600.)

(215 ILCS 130/4002) (from Ch. 73, par. 1504‑2)     Sec. 4002. Health Maintenance Organization Act. Limited health service organizations shall be subject to the provisions of Sections 1‑3 and 3‑1 of the Health Maintenance Organization Act, as now or hereafter amended. (Source: P.A. 86‑600.)

(215 ILCS 130/4002.1)     Sec. 4002.1. Woman's health care provider. Limited health service organizations are subject to the provisions of Section 356r of the Illinois Insurance Code. (Source: P.A. 89‑514, eff. 7‑17‑96.)

(215 ILCS 130/4002.5)     Sec. 4002.5. Illinois Health Insurance Portability and Accountability Act. The provisions of this Act are subject to the Illinois Health Insurance Portability and Accountability Act as provided in Section 15 of that Act. (Source: P.A. 90‑30, eff. 7‑1‑97.)

(215 ILCS 130/4002.6)     Sec. 4002.6. Managed Care Reform and Patient Rights Act. Except for health care plans offering only dental services or only vision services, limited health service organizations are subject to the provisions of the Managed Care Reform and Patient Rights Act. (Source: P.A. 91‑617, eff. 1‑1‑00.)

    (215 ILCS 130/4003)(from Ch. 73, par. 1504‑3)
    Sec. 4003. Illinois Insurance Code provisions. Limited health service organizations shall be subject to the provisions of Sections 133, 134, 137, 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, 155.37, 355.2, 356v, 356z.10, 368a, 401, 401.1, 402, 403, 403A, 408, 408.2, 409, 412, 444, and 444.1 and Articles IIA, VIII 1/2, XII, XII 1/2, XIII, XIII 1/2, XXV, and XXVI of the Illinois Insurance Code. For purposes of the Illinois Insurance Code, except for Sections 444 and 444.1 and Articles XIII and XIII 1/2, limited health service organizations in the following categories are deemed to be domestic companies:
        (1) a corporation under the laws of this State; or
        (2) a corporation organized under the laws of

another state, 30% of more of the enrollees of which are residents of this State, except a corporation subject to substantially the same requirements in its state of organization as is a domestic company under Article VIII 1/2 of the Illinois Insurance Code.

(Source: P.A. 95‑520, eff. 8‑28‑07; 95‑876, eff. 8‑21‑08.)

(215 ILCS 130/4004) (from Ch. 73, par. 1504‑4)     Sec. 4004. Examination of affairs and quality of services by the Director; books and records.     (a) The Director shall have, with respect to limited health service organizations, the powers of examination conferred upon him pursuant to Sections 132 through 132.7 of the Illinois Insurance Code. The Director shall make an examination concerning the quality of limited health services of any limited health service organization and providers with whom the organization has contracts, agreements, or other arrangements pursuant to its limited health care plan as often as he deems it necessary for the protection of the interests of the people of this State. The cost of any examination shall be paid by the limited health service organization being examined.     (b) Every limited health service organization and provider shall submit its books and records relating to the limited health care plan to examination and in every way facilitate it. For the purpose of examination, the Director may administer an oath to and examine the officers, agents, employees, and producers of the limited health service organization and the principals of providers concerning their business. (Source: P.A. 89‑97, eff. 7‑7‑95.)

(215 ILCS 130/4005) (from Ch. 73, par. 1504‑5)     Sec. 4005. Suspension or revocation or denial of certification of authority. (a) The Director may suspend or revoke any certificate of authority issued to a limited health service organization under this Act or deny an application for a certificate of authority if he finds:         (1) That the limited health service organization is

operating significantly in contravention of its basic organizational document, its health care plan or in a manner contrary to that described in any information submitted under Sections 2001 or 3006.

(2) The limited health service organization issues

contracts or evidences of coverage or uses a schedule of charges for health care services which do not comply with the requirements of Sections 2001 or 3006.

(3) The limited health care plan does not provide or

arrange for limited health services.

(4) That the limited health service organization has

failed to meet the requirements for issuance of a certificate of authority as set forth in Section 2002.

(5) That the limited health service organization is

unable to fulfill its obligation to furnish limited health services as required under its limited health care plan.

(6) The limited health service organization is no

longer financially responsible and may reasonably be expected to be unable to meet its obligations to enrollees or prospective enrollees.

(7) The limited health service organization, or any

person on its behalf, has advertised or merchandised its services in an untrue, misrepresentative, misleading, deceptive or unfair manner.

(8) The continued operation of the limited health

service organization would be hazardous to its enrollees.

(9) The limited health service organization has

neglected to correct, within the time prescribed by subsection (c) of Section 2004, any deficiency occurring due to such organization's prescribed minimum net worth.

(10) The limited health service organization has

otherwise failed to substantially comply with this Act.

(b) When the certificate of authority of a limited health service organization is revoked, such organization shall proceed, immediately following the effective date of the order of revocation, to wind up its affairs and shall conduct no further business except as may be essential to the orderly conclusion of the affairs of such organization. The Director may permit such further operation of the organization as he may find to be in the best interest of enrollees to the end that the enrollees will be afforded the greatest practical opportunity to obtain limited health services. (Source: P.A. 86‑600.)

(215 ILCS 130/4006) (from Ch. 73, par. 1504‑6)     Sec. 4006. Supervision of rehabilitation, liquidation or conservation by the Director.     (a) For purposes of the rehabilitation, liquidation or conservation of a limited health service organization, the operation of a limited health service organization in this State constitutes a form of insurance protection which should be governed by the same provisions governing the rehabilitation, liquidation or conservation of insurance companies. Any rehabilitation, liquidation or conservation of a limited health service organization shall be based upon the grounds set forth in and subject to the provisions of the laws of this State regarding the rehabilitation, liquidation or conservation of an insurance company and shall be conducted under the supervision of the Director. Insolvency, as a ground for rehabilitation, liquidation or conservation of a limited health service organization, shall be recognized when a limited health service organization cannot be expected to satisfy its financial obligations when such obligations are to become due or when the limited health service organization has neglected to correct, within the time prescribed by subsection (c) of Section 2004, a deficiency occurring due to such organization's prescribed minimum net worth being impaired. For purpose of determining the priority of distribution of general assets, claims of enrollees and enrollees' beneficiaries shall have the same priority as established by Section 205 of the Illinois Insurance Code, for policyholders and beneficiaries of insureds of insurance companies. If an enrollee is liable to any provider for services provided pursuant to and covered by the limited health care plan, that liability shall have the status of an enrollee claim for distribution of general assets.     Any provider who is obligated by statute or agreement to hold enrollees harmless from liability for services provided pursuant to and covered by a limited health care plan shall have a priority of distribution of the general assets immediately following that of enrollees and enrollees' beneficiaries as described herein, and immediately preceding the priority of distribution described in paragraph (e) of subsection (1) of Section 205 of the Illinois Insurance Code.     (b) For purposes of Articles XIII and XIII 1/2 of the Illinois Insurance Code, organizations in the following categories shall be deemed to be a domestic company and a domiciliary company:         (1) a corporation organized under the laws of this

State; or

(2) a corporation organized under the laws of

another state, 20% or more the enrollees of which are residents of this State, except where such a corporation is, in its state of incorporation, subject to rehabilitation, liquidation and conservation under the laws relating to insurance companies.

(Source: P.A. 89‑206, eff. 7‑21‑95.)

(215 ILCS 130/4007) (from Ch. 73, par. 1504‑7)     Sec. 4007. Rules and regulations. (a) The Director may promulgate reasonable rules and regulations as are necessary and proper to establish specific standards, including standards for the full and fair disclosure of limited health services provided by group contracts and evidences of coverage, which may cover, but shall not be limited to:         (1) Coordination of benefits.         (2) Conversion.         (3) Cancellation and termination.     (b) The Director may promulgate reasonable rules and regulations as are necessary and proper to otherwise carry out the provisions of this Act. (Source: P.A. 86‑600.)

(215 ILCS 130/4008) (from Ch. 73, par. 1504‑8)     Sec. 4008. Grounds for denial, suspension or revocation of certificate of authority under Administrative Review Law. (a) When the Director has cause to believe that grounds for the denial of an application for a certificate of authority exist or that grounds for the suspension or revocation of a certificate of authority exist, he shall issue an order to the organization or applicant stating the grounds upon which the suspension, revocation or denial is based. The order shall be sent to the organization or applicant by certified or registered mail. The organization or applicant may in writing request a hearing within 30 days from the date of mailing of the order. If no written request is made, the order shall be final upon the expiration of said 30 days.     (b) If the organization or applicant requests a hearing pursuant to this Section the Director shall issue a written notice of hearing sent to the organization or applicant by certified or registered mail stating:         (1) A specific time for the hearing, which may not

be less than 20 nor more than 30 days after mailing of the notice of hearing.

(2) A specific place for the hearing, which may be

either in the City of Springfield or in the county where the organization's or applicant's principal place of business is located.

(c) After such hearing, or upon the failure of the limited health service organization to appear at such hearing, the Director shall take action as is deemed advisable on written findings which shall be mailed to the organization or applicant. The action of the Director shall be subject to review under the Administrative Review Law, as now or hereafter amended. (Source: P.A. 86‑600.)

(215 ILCS 130/4009) (from Ch. 73, par. 1504‑9)     Sec. 4009. Violations; cease and desist order; corrective orders. (a) Any organization which violates this Act shall be guilty of a Class B misdemeanor.     (b) The Director may issue to any organization subject to this Act, a cease and desist order as provided in Article XXIV of the Illinois Insurance Code, as now or hereafter amended.     (c) The Director may issue corrective orders to any organization subject to this Act, as provided in Article XII 1/2 of the Illinois Insurance Code, as now or hereafter amended. (Source: P.A. 86‑600.)