Illinois lets insurance director reject large group health rate filings
A bill Gov. Jay Pritzker signed last week sets provider network standards and bans "step therapy" and prior authorization reviews for emergency mental health care.
States once avoided imposing too many health insurance mandates on large, fully insured, employer-sponsored group health plans, for fear that large groups would drop their state-regulated insurance and shift to using self-funded health plans.
The federal government regulates self-funded plans through the U.S. Labor Department’s Employee Benefits Security Administration.
Illinois may be blazing a trail for states that want to get tougher on large groups.
Illinois Gov. Jay Pritzker, a Democrat, last week signed a package of bills that included House Bill 5395, a network adequacy standards bill.
The new law lets the Illinois insurance director choose whether to accept or reject insurers’ large group health insurance rate proposals.
The new law also lets the insurance director apply the same state provider network adequacy rules that apply to individual coverage and small employers to large groups.
Related: Why ICHRAs are the future of large-group health insurance
Other bill provisions will ban prior authorization reviews for emergency mental health care and ban “step therapy,” or plan efforts to hold down the cost of care by requiring patients to try cheaper treatments before trying more expensive treatments.
A provision in a separate bill Pritzker signed would ban the sale of short-term health insurance in Illinois.
During a bill signing press conference that was streamed live online, Pritzker talked about a friend who had trouble getting get his daughter inpatient care after a suicide attempt because of a health plan prior authorization requirement. The friend was able to get his daughter admitted only because he knew the president of a hospital.
“A person in need of immediate help shouldn’t have to jump through hoops during a crisis,” Pritzker said.
The list of health bill supporters included the Illinois Department of Insurance and many health care provider and patient advocacy groups.
Groups that opposed the package at a hearing in May included America’s Health Insurance Plans, CVS Health and the Illinois Life & Health Insurance Council.
Laura Minzer, president of the council, said after final passage of the bill that she believed that policymakers had listened to the council and made welcome changes.
But she suggested that provisions such as the ban on step therapy could end up increasing coverage costs.
“We hope to make more progress during the implementation phase,” Minzer said.