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1		AN ACT concerning regulation.
2		Be it enacted by the People of the State of Illinois,
3		represented in the General Assembly:
4		Section 1. The Freedom of Information Act is amended by
5		changing Sections 7 and 7.5 as follows:
6		(5 ILCS 140/7) (from Ch. 116, par. 207)
7		Sec. 7. Exemptions.
8		(1) When a request is made to inspect or copy a public
9		record that contains information that is exempt from disclosure
10		under this Section, but also contains information that is not
11		exempt from disclosure, the public body may elect to redact the
12		information that is exempt. The public body shall make the
13		remaining information available for inspection and copying.
14		Subject to this requirement, the following shall be exempt from
15		inspection and copying:
16		(a) Information specifically prohibited from
17		disclosure by federal or State law or rules and regulations
18		implementing federal or State law.
19		(b) Private information, unless disclosure is required
20		by another provision of this Act, a State or federal law or
21		a court order.
22		(b-5) Files, documents, and other data or databases
23		maintained by one or more law enforcement agencies and

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1		specifically designed to provide information to one or more
2		law enforcement agencies regarding the physical or mental
3		status of one or more individual subjects.
4		(c) Personal information contained within public
5		records, the disclosure of which would constitute a clearly
6		unwarranted invasion of personal privacy, unless the
7		disclosure is consented to in writing by the individual
8		subjects of the information. "Unwarranted invasion of
9		personal privacy" means the disclosure of information that
10		is highly personal or objectionable to a reasonable person
11		and in which the subject's right to privacy outweighs any
12		legitimate public interest in obtaining the information.
13		The disclosure of information that bears on the public
14		duties of public employees and officials shall not be
15		considered an invasion of personal privacy.
16		(d) Records in the possession of any public body
17		created in the course of administrative enforcement
18		proceedings, and any law enforcement or correctional
19		agency for law enforcement purposes, but only to the extent
20		that disclosure would:
21		(i) interfere with pending or actually and
22		reasonably contemplated law enforcement proceedings
23		conducted by any law enforcement or correctional
24		agency that is the recipient of the request;
25		(ii) interfere with active administrative
26		enforcement proceedings conducted by the public body

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1		that is the recipient of the request;
2		(iii) create a substantial likelihood that a
3		person will be deprived of a fair trial or an impartial
4		hearing;
5		(iv) unavoidably disclose the identity of a
6		confidential source, confidential information
7		furnished only by the confidential source, or persons
8		who file complaints with or provide information to
9		administrative, investigative, law enforcement, or
10		penal agencies; except that the identities of
11		witnesses to traffic accidents, traffic accident
12		reports, and rescue reports shall be provided by
13		agencies of local government, except when disclosure
14		would interfere with an active criminal investigation
15		conducted by the agency that is the recipient of the
16		request;
17		(v) disclose unique or specialized investigative
18		techniques other than those generally used and known or
19		disclose internal documents of correctional agencies
20		related to detection, observation or investigation of
21		incidents of crime or misconduct, and disclosure would
22		result in demonstrable harm to the agency or public
23		body that is the recipient of the request;
24		(vi) endanger the life or physical safety of law
25		enforcement personnel or any other person; or
26		(vii) obstruct an ongoing criminal investigation

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1		by the agency that is the recipient of the request.
2		(d-5) A law enforcement record created for law
3		enforcement purposes and contained in a shared electronic
4		record management system if the law enforcement agency that
5		is the recipient of the request did not create the record,
6		did not participate in or have a role in any of the events
7		which are the subject of the record, and only has access to
8		the record through the shared electronic record management
9		system.
10		(e) Records that relate to or affect the security of
11		correctional institutions and detention facilities.
12		(e-5) Records requested by persons committed to the
13		Department of Corrections, Department of Human Services
14		Division of Mental Health, or a county jail if those
15		materials are available in the library of the correctional
16		institution or facility or jail where the inmate is
17		confined.
18		(e-6) Records requested by persons committed to the
19		Department of Corrections, Department of Human Services
20		Division of Mental Health, or a county jail if those
21		materials include records from staff members' personnel
22		files, staff rosters, or other staffing assignment
23		information.
24		(e-7) Records requested by persons committed to the
25		Department of Corrections or Department of Human Services
26		Division of Mental Health if those materials are available

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1		through an administrative request to the Department of
2		Corrections or Department of Human Services Division of
3		Mental Health.
4		(e-8) Records requested by a person committed to the
5		Department of Corrections, Department of Human Services
6		Division of Mental Health, or a county jail, the disclosure
7		of which would result in the risk of harm to any person or
8		the risk of an escape from a jail or correctional
9		institution or facility.
10		(e-9) Records requested by a person in a county jail or
11		committed to the Department of Corrections or Department of
12		Human Services Division of Mental Health, containing
13		personal information pertaining to the person's victim or
14		the victim's family, including, but not limited to, a
15		victim's home address, home telephone number, work or
16		school address, work telephone number, social security
17		number, or any other identifying information, except as may
18		be relevant to a requester's current or potential case or
19		claim.
20		(e-10) Law enforcement records of other persons
21		requested by a person committed to the Department of
22		Corrections, Department of Human Services Division of
23		Mental Health, or a county jail, including, but not limited
24		to, arrest and booking records, mug shots, and crime scene
25		photographs, except as these records may be relevant to the
26		requester's current or potential case or claim.

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1		(f) Preliminary drafts, notes, recommendations,
2		memoranda and other records in which opinions are
3		expressed, or policies or actions are formulated, except
4		that a specific record or relevant portion of a record
5		shall not be exempt when the record is publicly cited and
6		identified by the head of the public body. The exemption
7		provided in this paragraph (f) extends to all those records
8		of officers and agencies of the General Assembly that
9		pertain to the preparation of legislative documents.
10		(g) Trade secrets and commercial or financial
11		information obtained from a person or business where the
12		trade secrets or commercial or financial information are
13		furnished under a claim that they are proprietary,
14		privileged or confidential, and that disclosure of the
15		trade secrets or commercial or financial information would
16		cause competitive harm to the person or business, and only
17		insofar as the claim directly applies to the records
18		requested.
19		The information included under this exemption includes
20		all trade secrets and commercial or financial information
21		obtained by a public body, including a public pension fund,
22		from a private equity fund or a privately held company
23		within the investment portfolio of a private equity fund as
24		a result of either investing or evaluating a potential
25		investment of public funds in a private equity fund. The
26		exemption contained in this item does not apply to the

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1		aggregate financial performance information of a private
2		equity fund, nor to the identity of the fund's managers or
3		general partners. The exemption contained in this item does
4		not apply to the identity of a privately held company
5		within the investment portfolio of a private equity fund,
6		unless the disclosure of the identity of a privately held
7		company may cause competitive harm.
8		Nothing contained in this paragraph (g) shall be
9		construed to prevent a person or business from consenting
10		to disclosure.
11		(h) Proposals and bids for any contract, grant, or
12		agreement, including information which if it were
13		disclosed would frustrate procurement or give an advantage
14		to any person proposing to enter into a contractor
15		agreement with the body, until an award or final selection
16		is made. Information prepared by or for the body in
17		preparation of a bid solicitation shall be exempt until an
18		award or final selection is made.
19		(i) Valuable formulae, computer geographic systems,
20		designs, drawings and research data obtained or produced by
21		any public body when disclosure could reasonably be
22		expected to produce private gain or public loss. The
23		exemption for "computer geographic systems" provided in
24		this paragraph (i) does not extend to requests made by news
25		media as defined in Section 2 of this Act when the
26		requested information is not otherwise exempt and the only

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1		purpose of the request is to access and disseminate
2		information regarding the health, safety, welfare, or
3		legal rights of the general public.
4		(j) The following information pertaining to
5		educational matters:
6		(i) test questions, scoring keys and other
7		examination data used to administer an academic
8		examination;
9		(ii) information received by a primary or
10		secondary school, college, or university under its
11		procedures for the evaluation of faculty members by
12		their academic peers;
13		(iii) information concerning a school or
14		university's adjudication of student disciplinary
15		cases, but only to the extent that disclosure would
16		unavoidably reveal the identity of the student; and
17		(iv) course materials or research materials used
18		by faculty members.
19		(k) Architects' plans, engineers' technical
20		submissions, and other construction related technical
21		documents for projects not constructed or developed in
22		whole or in part with public funds and the same for
23		projects constructed or developed with public funds,
24		including but not limited to power generating and
25		distribution stations and other transmission and
26		distribution facilities, water treatment facilities,

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1		airport facilities, sport stadiums, convention centers,
2		and all government owned, operated, or occupied buildings,
3		but only to the extent that disclosure would compromise
4		security.
5		(l) Minutes of meetings of public bodies closed to the
6		public as provided in the Open Meetings Act until the
7		public body makes the minutes available to the public under
8		Section 2.06 of the Open Meetings Act.
9		(m) Communications between a public body and an
10		attorney or auditor representing the public body that would
11		not be subject to discovery in litigation, and materials
12		prepared or compiled by or for a public body in
13		anticipation of a criminal, civil or administrative
14		proceeding upon the request of an attorney advising the
15		public body, and materials prepared or compiled with
16		respect to internal audits of public bodies.
17		(n) Records relating to a public body's adjudication of
18		employee grievances or disciplinary cases; however, this
19		exemption shall not extend to the final outcome of cases in
20		which discipline is imposed.
21		(o) Administrative or technical information associated
22		with automated data processing operations, including but
23		not limited to software, operating protocols, computer
24		program abstracts, file layouts, source listings, object
25		modules, load modules, user guides, documentation
26		pertaining to all logical and physical design of

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1		computerized systems, employee manuals, and any other
2		information that, if disclosed, would jeopardize the
3		security of the system or its data or the security of
4		materials exempt under this Section.
5		(p) Records relating to collective negotiating matters
6		between public bodies and their employees or
7		representatives, except that any final contract or
8		agreement shall be subject to inspection and copying.
9		(q) Test questions, scoring keys, and other
10		examination data used to determine the qualifications of an
11		applicant for a license or employment.
12		(r) The records, documents, and information relating
13		to real estate purchase negotiations until those
14		negotiations have been completed or otherwise terminated.
15		With regard to a parcel involved in a pending or actually
16		and reasonably contemplated eminent domain proceeding
17		under the Eminent Domain Act, records, documents and
18		information relating to that parcel shall be exempt except
19		as may be allowed under discovery rules adopted by the
20		Illinois Supreme Court. The records, documents and
21		information relating to a real estate sale shall be exempt
22		until a sale is consummated.
23		(s) Any and all proprietary information and records
24		related to the operation of an intergovernmental risk
25		management association or self-insurance pool or jointly
26		self-administered health and accident cooperative or pool.

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1		Insurance or self insurance (including any
2		intergovernmental risk management association or self
3		insurance pool) claims, loss or risk management
4		information, records, data, advice or communications.
5		(t) Information contained in or related to
6		examination, operating, or condition reports prepared by,
7		on behalf of, or for the use of a public body responsible
8		for the regulation or supervision of financial
9		institutions, or insurance companies, or pharmacy benefit
10		managers, unless disclosure is otherwise required by State
11		law.
12		(u) Information that would disclose or might lead to
13		the disclosure of secret or confidential information,
14		codes, algorithms, programs, or private keys intended to be
15		used to create electronic or digital signatures under the
16		Electronic Commerce Security Act.
17		(v) Vulnerability assessments, security measures, and
18		response policies or plans that are designed to identify,
19		prevent, or respond to potential attacks upon a community's
20		population or systems, facilities, or installations, the
21		destruction or contamination of which would constitute a
22		clear and present danger to the health or safety of the
23		community, but only to the extent that disclosure could
24		reasonably be expected to jeopardize the effectiveness of
25		the measures or the safety of the personnel who implement
26		them or the public. Information exempt under this item may

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1		include such things as details pertaining to the
2		mobilization or deployment of personnel or equipment, to
3		the operation of communication systems or protocols, or to
4		tactical operations.
5		(w) (Blank).
6		(x) Maps and other records regarding the location or
7		security of generation, transmission, distribution,
8		storage, gathering, treatment, or switching facilities
9		owned by a utility, by a power generator, or by the
10		Illinois Power Agency.
11		(y) Information contained in or related to proposals,
12		bids, or negotiations related to electric power
13		procurement under Section 1-75 of the Illinois Power Agency
14		Act and Section 16-111.5 of the Public Utilities Act that
15		is determined to be confidential and proprietary by the
16		Illinois Power Agency or by the Illinois Commerce
17		Commission.
18		(z) Information about students exempted from
19		disclosure under Sections 10-20.38 or 34-18.29 of the
20		School Code, and information about undergraduate students
21		enrolled at an institution of higher education exempted
22		from disclosure under Section 25 of the Illinois Credit
23		Card Marketing Act of 2009.
24		(aa) Information the disclosure of which is exempted
25		under the Viatical Settlements Act of 2009.
26		(bb) Records and information provided to a mortality

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1		review team and records maintained by a mortality review
2		team appointed under the Department of Juvenile Justice
3		Mortality Review Team Act.
4		(cc) Information regarding interments, entombments, or
5		inurnments of human remains that are submitted to the
6		Cemetery Oversight Database under the Cemetery Care Act or
7		the Cemetery Oversight Act, whichever is applicable.
8		(dd) Correspondence and records (i) that may not be
9		disclosed under Section 11-9 of the Illinois Public Aid
10		Code or (ii) that pertain to appeals under Section 11-8 of
11		the Illinois Public Aid Code.
12		(ee) The names, addresses, or other personal
13		information of persons who are minors and are also
14		participants and registrants in programs of park
15		districts, forest preserve districts, conservation
16		districts, recreation agencies, and special recreation
17		associations.
18		(ff) The names, addresses, or other personal
19		information of participants and registrants in programs of
20		park districts, forest preserve districts, conservation
21		districts, recreation agencies, and special recreation
22		associations where such programs are targeted primarily to
23		minors.
24		(gg) Confidential information described in Section
25		1-100 of the Illinois Independent Tax Tribunal Act of 2012.
26		(hh) The report submitted to the State Board of

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1		Education by the School Security and Standards Task Force
2		under item (8) of subsection (d) of Section 2-3.160 of the
3		School Code and any information contained in that report.
4		(ii) Records requested by persons committed to or
5		detained by the Department of Human Services under the
6		Sexually Violent Persons Commitment Act or committed to the
7		Department of Corrections under the Sexually Dangerous
8		Persons Act if those materials: (i) are available in the
9		library of the facility where the individual is confined;
10		(ii) include records from staff members' personnel files,
11		staff rosters, or other staffing assignment information;
12		or (iii) are available through an administrative request to
13		the Department of Human Services or the Department of
14		Corrections.
15		(jj) Confidential information described in Section
16		5-535 of the Civil Administrative Code of Illinois.
17		(1.5) Any information exempt from disclosure under the
18		Judicial Privacy Act shall be redacted from public records
19		prior to disclosure under this Act.
20		(2) A public record that is not in the possession of a
21		public body but is in the possession of a party with whom the
22		agency has contracted to perform a governmental function on
23		behalf of the public body, and that directly relates to the
24		governmental function and is not otherwise exempt under this
25		Act, shall be considered a public record of the public body,
26		for purposes of this Act.

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1		(3) This Section does not authorize withholding of
2		information or limit the availability of records to the public,
3		except as stated in this Section or otherwise provided in this
4		Act.
5		(Source: P.A. 99-298, eff. 8-6-15; 99-346, eff. 1-1-16; 99-642,
6		eff. 7-28-16; 100-26, eff. 8-4-17; 100-201, eff. 8-18-17;
7		100-732, eff. 8-3-18.)
8		(5 ILCS 140/7.5)
9		Sec. 7.5. Statutory exemptions. To the extent provided for
10		by the statutes referenced below, the following shall be exempt
11		from inspection and copying:
12		(a) All information determined to be confidential
13		under Section 4002 of the Technology Advancement and
14		Development Act.
15		(b) Library circulation and order records identifying
16		library users with specific materials under the Library
17		Records Confidentiality Act.
18		(c) Applications, related documents, and medical
19		records received by the Experimental Organ Transplantation
20		Procedures Board and any and all documents or other records
21		prepared by the Experimental Organ Transplantation
22		Procedures Board or its staff relating to applications it
23		has received.
24		(d) Information and records held by the Department of
25		Public Health and its authorized representatives relating

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1		to known or suspected cases of sexually transmissible
2		disease or any information the disclosure of which is
3		restricted under the Illinois Sexually Transmissible
4		Disease Control Act.
5		(e) Information the disclosure of which is exempted
6		under Section 30 of the Radon Industry Licensing Act.
7		(f) Firm performance evaluations under Section 55 of
8		the Architectural, Engineering, and Land Surveying
9		Qualifications Based Selection Act.
10		(g) Information the disclosure of which is restricted
11		and exempted under Section 50 of the Illinois Prepaid
12		Tuition Act.
13		(h) Information the disclosure of which is exempted
14		under the State Officials and Employees Ethics Act, and
15		records of any lawfully created State or local inspector
16		general's office that would be exempt if created or
17		obtained by an Executive Inspector General's office under
18		that Act.
19		(i) Information contained in a local emergency energy
20		plan submitted to a municipality in accordance with a local
21		emergency energy plan ordinance that is adopted under
22		Section 11-21.5-5 of the Illinois Municipal Code.
23		(j) Information and data concerning the distribution
24		of surcharge moneys collected and remitted by carriers
25		under the Emergency Telephone System Act.
26		(k) Law enforcement officer identification information

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1		or driver identification information compiled by a law
2		enforcement agency or the Department of Transportation
3		under Section 11-212 of the Illinois Vehicle Code.
4		(l) Records and information provided to a residential
5		health care facility resident sexual assault and death
6		review team or the Executive Council under the Abuse
7		Prevention Review Team Act.
8		(m) Information provided to the predatory lending
9		database created pursuant to Article 3 of the Residential
10		Real Property Disclosure Act, except to the extent
11		authorized under that Article.
12		(n) Defense budgets and petitions for certification of
13		compensation and expenses for court appointed trial
14		counsel as provided under Sections 10 and 15 of the Capital
15		Crimes Litigation Act. This subsection (n) shall apply
16		until the conclusion of the trial of the case, even if the
17		prosecution chooses not to pursue the death penalty prior
18		to trial or sentencing.
19		(o) Information that is prohibited from being
20		disclosed under Section 4 of the Illinois Health and
21		Hazardous Substances Registry Act.
22		(p) Security portions of system safety program plans,
23		investigation reports, surveys, schedules, lists, data, or
24		information compiled, collected, or prepared by or for the
25		Regional Transportation Authority under Section 2.11 of
26		the Regional Transportation Authority Act or the St. Clair

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1		County Transit District under the Bi-State Transit Safety
2		Act.
3		(q) Information prohibited from being disclosed by the
4		Personnel Record Records Review Act.
5		(r) Information prohibited from being disclosed by the
6		Illinois School Student Records Act.
7		(s) Information the disclosure of which is restricted
8		under Section 5-108 of the Public Utilities Act.
9		(t) All identified or deidentified health information
10		in the form of health data or medical records contained in,
11		stored in, submitted to, transferred by, or released from
12		the Illinois Health Information Exchange, and identified
13		or deidentified health information in the form of health
14		data and medical records of the Illinois Health Information
15		Exchange in the possession of the Illinois Health
16		Information Exchange Authority due to its administration
17		of the Illinois Health Information Exchange. The terms
18		"identified" and "deidentified" shall be given the same
19		meaning as in the Health Insurance Portability and
20		Accountability Act of 1996, Public Law 104-191, or any
21		subsequent amendments thereto, and any regulations
22		promulgated thereunder.
23		(u) Records and information provided to an independent
24		team of experts under the Developmental Disability and
25		Mental Health Safety Act (also known as Brian's Law).
26		(v) Names and information of people who have applied

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1		for or received Firearm Owner's Identification Cards under
2		the Firearm Owners Identification Card Act or applied for
3		or received a concealed carry license under the Firearm
4		Concealed Carry Act, unless otherwise authorized by the
5		Firearm Concealed Carry Act; and databases under the
6		Firearm Concealed Carry Act, records of the Concealed Carry
7		Licensing Review Board under the Firearm Concealed Carry
8		Act, and law enforcement agency objections under the
9		Firearm Concealed Carry Act.
10		(w) Personally identifiable information which is
11		exempted from disclosure under subsection (g) of Section
12		19.1 of the Toll Highway Act.
13		(x) Information which is exempted from disclosure
14		under Section 5-1014.3 of the Counties Code or Section
15		8-11-21 of the Illinois Municipal Code.
16		(y) Confidential information under the Adult
17		Protective Services Act and its predecessor enabling
18		statute, the Elder Abuse and Neglect Act, including
19		information about the identity and administrative finding
20		against any caregiver of a verified and substantiated
21		decision of abuse, neglect, or financial exploitation of an
22		eligible adult maintained in the Registry established
23		under Section 7.5 of the Adult Protective Services Act.
24		(z) Records and information provided to a fatality
25		review team or the Illinois Fatality Review Team Advisory
26		Council under Section 15 of the Adult Protective Services

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1		Act.
2		(aa) Information which is exempted from disclosure
3		under Section 2.37 of the Wildlife Code.
4		(bb) Information which is or was prohibited from
5		disclosure by the Juvenile Court Act of 1987.
6		(cc) Recordings made under the Law Enforcement
7		Officer-Worn Body Camera Act, except to the extent
8		authorized under that Act.
9		(dd) Information that is prohibited from being
10		disclosed under Section 45 of the Condominium and Common
11		Interest Community Ombudsperson Act.
12		(ee) Information that is exempted from disclosure
13		under Section 30.1 of the Pharmacy Practice Act.
14		(ff) Information that is exempted from disclosure
15		under the Revised Uniform Unclaimed Property Act.
16		(gg) Information that is prohibited from being
17		disclosed under Section 7-603.5 of the Illinois Vehicle
18		Code.
19		(hh) Records that are exempt from disclosure under
20		Section 1A-16.7 of the Election Code.
21		(ii) Information which is exempted from disclosure
22		under Section 2505-800 of the Department of Revenue Law of
23		the Civil Administrative Code of Illinois.
24		(jj) Information and reports that are required to be
25		submitted to the Department of Labor by registering day and
26		temporary labor service agencies but are exempt from

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1		disclosure under subsection (a-1) of Section 45 of the Day
2		and Temporary Labor Services Act.
3		(kk) Information prohibited from disclosure under the
4		Seizure and Forfeiture Reporting Act.
5		(ll) Information the disclosure of which is restricted
6		and exempted under Section 5-30.8 of the Illinois Public
7		Aid Code.
8		(mm) (ll) Records that are exempt from disclosure under
9		Section 4.2 of the Crime Victims Compensation Act.
10		(nn) (ll) Information that is exempt from disclosure
11		under Section 70 of the Higher Education Student Assistance
12		Act.
13		(oo) Information that is exempt from disclosure under
14		subsections (f) and (j) of Section 5-36 of the Illinois
15		Public Aid Code.
16		(Source: P.A. 99-78, eff. 7-20-15; 99-298, eff. 8-6-15; 99-352,
17		eff. 1-1-16; 99-642, eff. 7-28-16; 99-776, eff. 8-12-16;
18		99-863, eff. 8-19-16; 100-20, eff. 7-1-17; 100-22, eff. 1-1-18;
19		100-201, eff. 8-18-17; 100-373, eff. 1-1-18; 100-464, eff.
20		8-28-17; 100-465, eff. 8-31-17; 100-512, eff. 7-1-18; 100-517,
21		eff. 6-1-18; 100-646, eff. 7-27-18; 100-690, eff. 1-1-19;
22		100-863, eff. 8-14-18; 100-887, eff. 8-14-18; revised
23		10-12-18.)
24		Section 5. The State Employees Group Insurance Act of 1971
25		is amended by changing Section 6.11 as follows:

HB0465 Engrossed - 22 - LRB101 03398 JRG 48406 b
1		(5 ILCS 375/6.11)
2		(Text of Section after amendment by P.A. 100-1170)
3		Sec. 6.11. Required health benefits; Illinois Insurance
4		Code requirements. The program of health benefits shall provide
5		the post-mastectomy care benefits required to be covered by a
6		policy of accident and health insurance under Section 356t of
7		the Illinois Insurance Code. The program of health benefits
8		shall provide the coverage required under Sections 356g,
9		356g.5, 356g.5-1, 356m, 356u, 356w, 356x, 356z.2, 356z.4,
10		356z.6, 356z.8, 356z.9, 356z.10, 356z.11, 356z.12, 356z.13,
11		356z.14, 356z.15, 356z.17, 356z.22, 356z.25, 356z.26, 356z.29,
12		and 356z.32 of the Illinois Insurance Code. The program of
13		health benefits must comply with Sections 155.22a, 155.37,
14		355b, 356z.19, 370c, and 370c.1, and Article XXXIIB of the
15		Illinois Insurance Code. The Department of Insurance shall
16		enforce the requirements of this Section with respect to
17		Sections 370c and 370c.1 of the Illinois Insurance Code; all
18		other requirements of this Section shall be enforced by the
19		Department of Central Management Services.
20		Rulemaking authority to implement Public Act 95-1045, if
21		any, is conditioned on the rules being adopted in accordance
22		with all provisions of the Illinois Administrative Procedure
23		Act and all rules and procedures of the Joint Committee on
24		Administrative Rules; any purported rule not so adopted, for
25		whatever reason, is unauthorized.

HB0465 Engrossed - 23 - LRB101 03398 JRG 48406 b
1		(Source: P.A. 99-480, eff. 9-9-15; 100-24, eff. 7-18-17;
2		100-138, eff. 8-18-17; 100-863, eff. 8-14-18; 100-1024, eff.
3		1-1-19; 100-1057, eff. 1-1-19; 100-1102, eff. 1-1-19;
4		100-1170, eff. 6-1-19.)
5		Section 10. The Illinois Insurance Code is amended by
6		adding Article XXXIIB as follows:
7		(215 ILCS 5/Art. XXXIIB heading new)
8		ARTICLE XXXIIB. PHARMACY BENEFIT MANAGERS
9		(215 ILCS 5/513b1 new)
10		Sec. 513b1. Pharmacy benefit manager contracts.
11		(a) As used in this Section:
12		"Biological product" has the meaning ascribed to that term
13		in Section 19.5 of the Pharmacy Practice Act.
14		"Maximum allowable cost" means the maximum amount that a
15		pharmacy benefit manager will reimburse a pharmacy for the cost
16		of a drug.
17		"Maximum allowable cost list" means a list of drugs for
18		which a maximum allowable cost has been established by a
19		pharmacy benefit manager.
20		"Pharmacy benefit manager" means a person, business, or
21		entity, including a wholly or partially owned or controlled
22		subsidiary of a pharmacy benefit manager, that provides claims
23		processing services or other prescription drug or device

HB0465 Engrossed - 24 - LRB101 03398 JRG 48406 b
1		services, or both, for health benefit plans.
2		"Retail price" means the price an individual without
3		prescription drug coverage would pay at a retail pharmacy, not
4		including a pharmacist dispensing fee.
5		(b) A contract between a health insurer and a pharmacy
6		benefit manager must require that the pharmacy benefit manager:
7		(1) Update maximum allowable cost pricing information
8		at least every 7 calendar days.
9		(2) Maintain a process that will, in a timely manner,
10		eliminate drugs from maximum allowable cost lists or modify
11		drug prices to remain consistent with changes in pricing
12		data used in formulating maximum allowable cost prices and
13		product availability.
14		(3) Provide access to its maximum allowable cost list
15		to each pharmacy or pharmacy services administrative
16		organization subject to the maximum allowable cost list.
17		Access may include a real-time pharmacy website portal to
18		be able to view the maximum allowable cost list. As used in
19		this Section, "pharmacy services administrative
20		organization" means an entity operating within the State
21		that contracts with independent pharmacies to conduct
22		business on their behalf with third-party payers. A
23		pharmacy services administrative organization may provide
24		administrative services to pharmacies and negotiate and
25		enter into contracts with third-party payers or pharmacy
26		benefit managers on behalf of pharmacies.

HB0465 Engrossed - 25 - LRB101 03398 JRG 48406 b
1		(4) Provide a process by which a contracted pharmacy
2		can appeal the provider's reimbursement for a drug subject
3		to maximum allowable cost pricing. The appeals process
4		must, at a minimum, include the following:
5		(A) A requirement that a contracted pharmacy has 14
6		calendar days after the applicable fill date to appeal
7		a maximum allowable cost if the reimbursement for the
8		drug is less than the net amount that the network
9		provider paid to the supplier of the drug.
10		(B) A requirement that a pharmacy benefit manager
11		must respond to a challenge within 14 calendar days of
12		the contracted pharmacy making the claim for which the
13		appeal has been submitted.
14		(C) A telephone number and e-mail address or
15		website to network providers, at which the provider can
16		contact the pharmacy benefit manager to process and
17		submit an appeal.
18		(D) A requirement that, if an appeal is denied, the
19		pharmacy benefit manager must provide the reason for
20		the denial and the name and the national drug code
21		number from national or regional wholesalers.
22		(E) A requirement that, if an appeal is sustained,
23		the pharmacy benefit manager must make an adjustment in
24		the drug price effective the date the challenge is
25		resolved and make the adjustment applicable to all
26		similarly situated network pharmacy providers, as

HB0465 Engrossed - 26 - LRB101 03398 JRG 48406 b
1		determined by the managed care organization or
2		pharmacy benefit manager.
3		(5) Allow a plan sponsor contracting with a pharmacy
4		benefit manager an annual right to audit compliance with
5		the terms of the contract by the pharmacy benefit manager,
6		including, but not limited to, full disclosure of any and
7		all rebate amounts secured, whether product specific or
8		generalized rebates, that were provided to the pharmacy
9		benefit manager by a pharmaceutical manufacturer.
10		(6) Allow a plan sponsor contracting with a pharmacy
11		benefit manager to request that the pharmacy benefit
12		manager disclose the actual amounts paid by the pharmacy
13		benefit manager to the pharmacy.
14		(7) Provide notice to the party contracting with the
15		pharmacy benefit manager of any consideration that the
16		pharmacy benefit manager receives from the manufacturer
17		for dispense as written prescriptions once a generic or
18		biologically similar product becomes available.
19		(c) In order to place a particular prescription drug on a
20		maximum allowable cost list, the pharmacy benefit manager must,
21		at a minimum, ensure that:
22		(1) if the drug is a generically equivalent drug, it is
23		listed as therapeutically equivalent and pharmaceutically
24		equivalent "A" or "B" rated in the United States Food and
25		Drug Administration's most recent version of the "Orange
26		Book" or have an NR or NA rating by Medi-Span, Gold

HB0465 Engrossed - 27 - LRB101 03398 JRG 48406 b
1		Standard, or a similar rating by a nationally recognized
2		reference;
3		(2) the drug is available for purchase by each pharmacy
4		in the State from national or regional wholesalers
5		operating in Illinois; and
6		(3) the drug is not obsolete.
7		(d) A pharmacy benefit manager is prohibited from limiting
8		a pharmacist's ability to disclose whether the cost-sharing
9		obligation exceeds the retail price for a covered prescription
10		drug, and the availability of a more affordable alternative
11		drug, if one is available in accordance with Section 42 of the
12		Pharmacy Practice Act.
13		(e) A health insurer or pharmacy benefit manager shall not
14		require an insured to make a payment for a prescription drug at
15		the point of sale in an amount that exceeds the lesser of:
16		(1) the applicable cost-sharing amount; or
17		(2) the retail price of the drug in the absence of
18		prescription drug coverage.
19		(f) This Section applies to contracts entered into or
20		renewed on or after July 1, 2020.
21		(g) This Section applies to any group or individual policy
22		of accident and health insurance or managed care plan that
23		provides coverage for prescription drugs and that is amended,
24		delivered, issued, or renewed on or after July 1, 2020.
25		(215 ILCS 5/513b2 new)

HB0465 Engrossed - 28 - LRB101 03398 JRG 48406 b
1		Sec. 513b2. Licensure requirements.
2		(a) Beginning on July 1, 2020, to conduct business in this
3		State, a pharmacy benefit manager must register with the
4		Director. To initially register or renew a registration, a
5		pharmacy benefit manager shall submit:
6		(1) A nonrefundable fee not to exceed $500.
7		(2) A copy of the registrant's corporate charter,
8		articles of incorporation, or other charter document.
9		(3) A completed registration form adopted by the
10		Director containing:
11		(A) The name and address of the registrant.
12		(B) The name, address, and official position of
13		each officer and director of the registrant.
14		(b) The registrant shall report any change in information
15		required under this Section to the Director in writing within
16		60 days after the change occurs.
17		(c) Upon receipt of a completed registration form, the
18		required documents, and the registration fee, the Director
19		shall issue a registration certificate. The certificate may be
20		in paper or electronic form, and shall clearly indicate the
21		expiration date of the registration. Registration certificates
22		are nontransferable.
23		(d) A registration certificate is valid for 2 years after
24		its date of issue. The Director shall adopt by rule an initial
25		registration fee not to exceed $500 and a registration renewal
26		fee not to exceed $500, both of which shall be nonrefundable.

HB0465 Engrossed - 29 - LRB101 03398 JRG 48406 b
1		Total fees may not exceed the cost of administering this
2		Section.
3		(e) The Department shall adopt any rules necessary to
4		implement this Section.
5		(215 ILCS 5/513b3 new)
6		Sec. 513b3. Examination.
7		(a) The Director, or his or her designee, may examine a
8		registered pharmacy benefit manager.
9		(b) Any pharmacy benefit manager being examined shall
10		provide to the Director, or his or her designee, convenient and
11		free access to all books, records, documents, and other papers
12		relating to such pharmacy benefit manager's business affairs at
13		all reasonable hours at its offices.
14		(c) The Director, or his or her designee, may administer
15		oaths and thereafter examine the pharmacy benefit manager's
16		designee, representative, or any officer or senior manager as
17		listed on the license or registration certificate about the
18		business of the pharmacy benefit manager.
19		(d) The examiners designated by the Director under this
20		Section may make reports to the Director. Any report alleging
21		substantive violations of this Article, any applicable
22		provisions of this Code, or any applicable Part of Title 50 of
23		the Illinois Administrative Code shall be in writing and be
24		based upon facts obtained by the examiners. The report shall be
25		verified by the examiners.

HB0465 Engrossed - 30 - LRB101 03398 JRG 48406 b
1		(e) If a report is made, the Director shall either deliver
2		a duplicate report to the pharmacy benefit manager being
3		examined or send such duplicate by certified or registered mail
4		to the pharmacy benefit manager's address specified in the
5		records of the Department. The Director shall afford the
6		pharmacy benefit manager an opportunity to request a hearing to
7		object to the report. The pharmacy benefit manager may request
8		a hearing within 30 days after receipt of the duplicate report
9		by giving the Director written notice of such request together
10		with written objections to the report. Any hearing shall be
11		conducted in accordance with Sections 402 and 403 of this Code.
12		The right to a hearing is waived if the delivery of the report
13		is refused or the report is otherwise undeliverable or the
14		pharmacy benefit manager does not timely request a hearing.
15		After the hearing or upon expiration of the time period during
16		which a pharmacy benefit manager may request a hearing, if the
17		examination reveals that the pharmacy benefit manager is
18		operating in violation of any applicable provision of this
19		Code, any applicable Part of Title 50 of the Illinois
20		Administrative Code, a provision of this Article, or prior
21		order, the Director, in the written order, may require the
22		pharmacy benefit manager to take any action the Director
23		considers necessary or appropriate in accordance with the
24		report or examination hearing. If the Director issues an order,
25		it shall be issued within 90 days after the report is filed, or
26		if there is a hearing, within 90 days after the conclusion of

HB0465 Engrossed - 31 - LRB101 03398 JRG 48406 b
1		the hearing. The order is subject to review under the
2		Administrative Review Law.
3		(215 ILCS 5/513b4 new)
4		Sec. 513b4. Denial, revocation, or suspension of
5		registration; administrative fines.
6		(a) Denial of an application or suspension or revocation of
7		a registration in accordance with this Section shall be by
8		written order sent to the applicant or registrant by certified
9		or registered mail at the address specified in the records of
10		the Department. The written order shall state the grounds,
11		charges, or conduct on which denial, suspension, or revocation
12		is based. The applicant or registrant may in writing request a
13		hearing within 30 days from the date of mailing. Upon receipt
14		of a written request, the Director shall issue an order
15		setting: (i) a specific time for the hearing, which may not be
16		less than 20 nor more than 30 days after receipt of the
17		request; and (ii) a specific place for the hearing, which may
18		be in either the city of Springfield or in the county in
19		Illinois where the applicant's or registrant's principal place
20		of business is located. If no written request is received by
21		the Director, such order shall be final upon the expiration of
22		said 30 days.
23		(b) If the Director finds that one or more grounds exist
24		for the revocation or suspension of a registration issued under
25		this Article, the Director may, in lieu of or in addition to

HB0465 Engrossed - 32 - LRB101 03398 JRG 48406 b
1		such suspension or revocation, impose a fine upon the pharmacy
2		benefit manager as provided under subsection (c).
3		(c) With respect to any knowing and willful violation of a
4		lawful order of the Director, any applicable portion of this
5		Code, Part of Title 50 of the Illinois Administrative Code, or
6		provision of this Article, the Director may impose a fine upon
7		the pharmacy benefit manager in an amount not to exceed $50,000
8		for each violation.
9		(215 ILCS 5/513b5 new)
10		Sec. 513b5. Failure to register. Any pharmacy benefit
11		manager that operates without a registration or fails to
12		register with the Director and pay the fee prescribed by this
13		Article is an unauthorized insurer as defined in Article VII of
14		this Code and shall be subject to all penalties provided for
15		therein.
16		(215 ILCS 5/513b6 new)
17		Sec. 513b6. Insurance Producer Administration Fund. All
18		fees and fines paid to and collected by the Director under this
19		Article shall be paid promptly after receipt thereof, together
20		with a detailed statement of such fees, into the Insurance
21		Producer Administration Fund. The moneys deposited into the
22		Insurance Producer Administration Fund may be transferred to
23		the Professions Indirect Cost Fund, as authorized under Section
24		2105-300 of the Department of Professional Regulation Law of

HB0465 Engrossed - 33 - LRB101 03398 JRG 48406 b
1		the Civil Administrative Code of Illinois.
2		Section 15. The Health Maintenance Organization Act is
3		amended by changing Section 5-3 as follows:
4		(215 ILCS 125/5-3) (from Ch. 111 1/2, par. 1411.2)
5		Sec. 5-3. Insurance Code provisions.
6		(a) Health Maintenance Organizations shall be subject to
7		the provisions of Sections 133, 134, 136, 137, 139, 140, 141.1,
8		141.2, 141.3, 143, 143c, 147, 148, 149, 151, 152, 153, 154,
9		154.5, 154.6, 154.7, 154.8, 155.04, 155.22a, 355.2, 355.3,
10		355b, 356g.5-1, 356m, 356v, 356w, 356x, 356y, 356z.2, 356z.4,
11		356z.5, 356z.6, 356z.8, 356z.9, 356z.10, 356z.11, 356z.12,
12		356z.13, 356z.14, 356z.15, 356z.17, 356z.18, 356z.19, 356z.21,
13		356z.22, 356z.25, 356z.26, 356z.29, 356z.30, 356z.32, 364,
14		364.01, 367.2, 367.2-5, 367i, 368a, 368b, 368c, 368d, 368e,
15		370c, 370c.1, 401, 401.1, 402, 403, 403A, 408, 408.2, 409, 412,
16		444, and 444.1, paragraph (c) of subsection (2) of Section 367,
17		and Articles IIA, VIII 1/2, XII, XII 1/2, XIII, XIII 1/2, XXV,
18		and XXVI, and XXXIIB of the Illinois Insurance Code.
19		(b) For purposes of the Illinois Insurance Code, except for
20		Sections 444 and 444.1 and Articles XIII and XIII 1/2, Health
21		Maintenance Organizations in the following categories are
22		deemed to be "domestic companies":
23		(1) a corporation authorized under the Dental Service
24		Plan Act or the Voluntary Health Services Plans Act;

HB0465 Engrossed - 34 - LRB101 03398 JRG 48406 b
1		(2) a corporation organized under the laws of this
2		State; or
3		(3) a corporation organized under the laws of another
4		state, 30% or more of the enrollees of which are residents
5		of this State, except a corporation subject to
6		substantially the same requirements in its state of
7		organization as is a "domestic company" under Article VIII
8		1/2 of the Illinois Insurance Code.
9		(c) In considering the merger, consolidation, or other
10		acquisition of control of a Health Maintenance Organization
11		pursuant to Article VIII 1/2 of the Illinois Insurance Code,
12		(1) the Director shall give primary consideration to
13		the continuation of benefits to enrollees and the financial
14		conditions of the acquired Health Maintenance Organization
15		after the merger, consolidation, or other acquisition of
16		control takes effect;
17		(2)(i) the criteria specified in subsection (1)(b) of
18		Section 131.8 of the Illinois Insurance Code shall not
19		apply and (ii) the Director, in making his determination
20		with respect to the merger, consolidation, or other
21		acquisition of control, need not take into account the
22		effect on competition of the merger, consolidation, or
23		other acquisition of control;
24		(3) the Director shall have the power to require the
25		following information:
26		(A) certification by an independent actuary of the

HB0465 Engrossed - 35 - LRB101 03398 JRG 48406 b
1		adequacy of the reserves of the Health Maintenance
2		Organization sought to be acquired;
3		(B) pro forma financial statements reflecting the
4		combined balance sheets of the acquiring company and
5		the Health Maintenance Organization sought to be
6		acquired as of the end of the preceding year and as of
7		a date 90 days prior to the acquisition, as well as pro
8		forma financial statements reflecting projected
9		combined operation for a period of 2 years;
10		(C) a pro forma business plan detailing an
11		acquiring party's plans with respect to the operation
12		of the Health Maintenance Organization sought to be
13		acquired for a period of not less than 3 years; and
14		(D) such other information as the Director shall
15		require.
16		(d) The provisions of Article VIII 1/2 of the Illinois
17		Insurance Code and this Section 5-3 shall apply to the sale by
18		any health maintenance organization of greater than 10% of its
19		enrollee population (including without limitation the health
20		maintenance organization's right, title, and interest in and to
21		its health care certificates).
22		(e) In considering any management contract or service
23		agreement subject to Section 141.1 of the Illinois Insurance
24		Code, the Director (i) shall, in addition to the criteria
25		specified in Section 141.2 of the Illinois Insurance Code, take
26		into account the effect of the management contract or service

HB0465 Engrossed - 36 - LRB101 03398 JRG 48406 b
1		agreement on the continuation of benefits to enrollees and the
2		financial condition of the health maintenance organization to
3		be managed or serviced, and (ii) need not take into account the
4		effect of the management contract or service agreement on
5		competition.
6		(f) Except for small employer groups as defined in the
7		Small Employer Rating, Renewability and Portability Health
8		Insurance Act and except for medicare supplement policies as
9		defined in Section 363 of the Illinois Insurance Code, a Health
10		Maintenance Organization may by contract agree with a group or
11		other enrollment unit to effect refunds or charge additional
12		premiums under the following terms and conditions:
13		(i) the amount of, and other terms and conditions with
14		respect to, the refund or additional premium are set forth
15		in the group or enrollment unit contract agreed in advance
16		of the period for which a refund is to be paid or
17		additional premium is to be charged (which period shall not
18		be less than one year); and
19		(ii) the amount of the refund or additional premium
20		shall not exceed 20% of the Health Maintenance
21		Organization's profitable or unprofitable experience with
22		respect to the group or other enrollment unit for the
23		period (and, for purposes of a refund or additional
24		premium, the profitable or unprofitable experience shall
25		be calculated taking into account a pro rata share of the
26		Health Maintenance Organization's administrative and

HB0465 Engrossed - 37 - LRB101 03398 JRG 48406 b
1		marketing expenses, but shall not include any refund to be
2		made or additional premium to be paid pursuant to this
3		subsection (f)). The Health Maintenance Organization and
4		the group or enrollment unit may agree that the profitable
5		or unprofitable experience may be calculated taking into
6		account the refund period and the immediately preceding 2
7		plan years.
8		The Health Maintenance Organization shall include a
9		statement in the evidence of coverage issued to each enrollee
10		describing the possibility of a refund or additional premium,
11		and upon request of any group or enrollment unit, provide to
12		the group or enrollment unit a description of the method used
13		to calculate (1) the Health Maintenance Organization's
14		profitable experience with respect to the group or enrollment
15		unit and the resulting refund to the group or enrollment unit
16		or (2) the Health Maintenance Organization's unprofitable
17		experience with respect to the group or enrollment unit and the
18		resulting additional premium to be paid by the group or
19		enrollment unit.
20		In no event shall the Illinois Health Maintenance
21		Organization Guaranty Association be liable to pay any
22		contractual obligation of an insolvent organization to pay any
23		refund authorized under this Section.
24		(g) Rulemaking authority to implement Public Act 95-1045,
25		if any, is conditioned on the rules being adopted in accordance
26		with all provisions of the Illinois Administrative Procedure

HB0465 Engrossed - 38 - LRB101 03398 JRG 48406 b
1		Act and all rules and procedures of the Joint Committee on
2		Administrative Rules; any purported rule not so adopted, for
3		whatever reason, is unauthorized.
4		(Source: P.A. 99-761, eff. 1-1-18; 100-24, eff. 7-18-17;
5		100-138, eff. 8-18-17; 100-863, eff. 8-14-18; 100-1026, eff.
6		8-22-18; 100-1057, eff. 1-1-19; 100-1102, eff. 1-1-19; revised
7		10-4-18.)
8		Section 20. The Managed Care Reform and Patient Rights Act
9		is amended by changing Sections 10 and 30 as follows:
10		(215 ILCS 134/10)
11		Sec. 10. Definitions.
12		"Adverse determination" means a determination by a health
13		care plan under Section 45 or by a utilization review program
14		under Section 85 that a health care service is not medically
15		necessary.
16		"Clinical peer" means a health care professional who is in
17		the same profession and the same or similar specialty as the
18		health care provider who typically manages the medical
19		condition, procedures, or treatment under review.
20		"Department" means the Department of Insurance.
21		"Emergency medical condition" means a medical condition
22		manifesting itself by acute symptoms of sufficient severity,
23		regardless of the final diagnosis given, (including, but not
24		limited to, severe pain) such that a prudent layperson, who

HB0465 Engrossed - 39 - LRB101 03398 JRG 48406 b
1		possesses an average knowledge of health and medicine, could
2		reasonably expect the absence of immediate medical attention to
3		result in:
4		(1) placing the health of the individual (or, with
5		respect to a pregnant woman, the health of the woman or her
6		unborn child) in serious jeopardy;
7		(2) serious impairment to bodily functions; or
8		(3) serious dysfunction of any bodily organ or part; .
9		(4) inadequately controlled pain; or
10		(5) with respect to a pregnant woman who is having
11		contractions:
12		(A) inadequate time to complete a safe transfer to
13		another hospital before delivery; or
14		(B) a transfer to another hospital may pose a
15		threat to the health or safety of the woman or unborn
16		child.
17		"Emergency medical screening examination" means a medical
18		screening examination and evaluation by a physician licensed to
19		practice medicine in all its branches, or to the extent
20		permitted by applicable laws, by other appropriately licensed
21		personnel under the supervision of or in collaboration with a
22		physician licensed to practice medicine in all its branches to
23		determine whether the need for emergency services exists.
24		"Emergency services" means, with respect to an enrollee of
25		a health care plan, transportation services, including but not
26		limited to ambulance services, and covered inpatient and

HB0465 Engrossed - 40 - LRB101 03398 JRG 48406 b
1		outpatient hospital services furnished by a provider qualified
2		to furnish those services that are needed to evaluate or
3		stabilize an emergency medical condition. "Emergency services"
4		does not refer to post-stabilization medical services.
5		"Enrollee" means any person and his or her dependents
6		enrolled in or covered by a health care plan.
7		"Health care plan" means a plan, including, but not limited
8		to, a health maintenance organization, a managed care community
9		network as defined in the Illinois Public Aid Code, or an
10		accountable care entity as defined in the Illinois Public Aid
11		Code that receives capitated payments to cover medical services
12		from the Department of Healthcare and Family Services, that
13		establishes, operates, or maintains a network of health care
14		providers that has entered into an agreement with the plan to
15		provide health care services to enrollees to whom the plan has
16		the ultimate obligation to arrange for the provision of or
17		payment for services through organizational arrangements for
18		ongoing quality assurance, utilization review programs, or
19		dispute resolution. Nothing in this definition shall be
20		construed to mean that an independent practice association or a
21		physician hospital organization that subcontracts with a
22		health care plan is, for purposes of that subcontract, a health
23		care plan.
24		For purposes of this definition, "health care plan" shall
25		not include the following:
26		(1) indemnity health insurance policies including

HB0465 Engrossed - 41 - LRB101 03398 JRG 48406 b
1		those using a contracted provider network;
2		(2) health care plans that offer only dental or only
3		vision coverage;
4		(3) preferred provider administrators, as defined in
5		Section 370g(g) of the Illinois Insurance Code;
6		(4) employee or employer self-insured health benefit
7		plans under the federal Employee Retirement Income
8		Security Act of 1974;
9		(5) health care provided pursuant to the Workers'
10		Compensation Act or the Workers' Occupational Diseases
11		Act; and
12		(6) not-for-profit voluntary health services plans
13		with health maintenance organization authority in
14		existence as of January 1, 1999 that are affiliated with a
15		union and that only extend coverage to union members and
16		their dependents.
17		"Health care professional" means a physician, a registered
18		professional nurse, or other individual appropriately licensed
19		or registered to provide health care services.
20		"Health care provider" means any physician, hospital
21		facility, facility licensed under the Nursing Home Care Act,
22		long-term care facility as defined in Section 1-113 of the
23		Nursing Home Care Act, or other person that is licensed or
24		otherwise authorized to deliver health care services. Nothing
25		in this Act shall be construed to define Independent Practice
26		Associations or Physician-Hospital Organizations as health

HB0465 Engrossed - 42 - LRB101 03398 JRG 48406 b
1		care providers.
2		"Health care services" means any services included in the
3		furnishing to any individual of medical care, or the
4		hospitalization incident to the furnishing of such care, as
5		well as the furnishing to any person of any and all other
6		services for the purpose of preventing, alleviating, curing, or
7		healing human illness or injury including home health and
8		pharmaceutical services and products.
9		"Medical director" means a physician licensed in any state
10		to practice medicine in all its branches appointed by a health
11		care plan.
12		"Person" means a corporation, association, partnership,
13		limited liability company, sole proprietorship, or any other
14		legal entity.
15		"Physician" means a person licensed under the Medical
16		Practice Act of 1987.
17		"Post-stabilization medical services" means health care
18		services provided to an enrollee that are furnished in a
19		licensed hospital by a provider that is qualified to furnish
20		such services, and determined to be medically necessary and
21		directly related to the emergency medical condition following
22		stabilization.
23		"Stabilization" means, with respect to an emergency
24		medical condition, to provide such medical treatment of the
25		condition as may be necessary to assure, within reasonable
26		medical probability, that no material deterioration of the

HB0465 Engrossed - 43 - LRB101 03398 JRG 48406 b
1		condition is likely to result.
2		"Utilization review" means the evaluation of the medical
3		necessity, appropriateness, and efficiency of the use of health
4		care services, procedures, and facilities.
5		"Utilization review program" means a program established
6		by a person to perform utilization review.
7		(Source: P.A. 98-651, eff. 6-16-14; 98-841, eff. 8-1-14; 99-78,
8		eff. 7-20-15.)
9		(215 ILCS 134/30)
10		Sec. 30. Prohibitions.
11		(a) No health care plan or its subcontractors may prohibit
12		or discourage health care providers by contract or policy from
13		discussing any health care services and health care providers,
14		utilization review and quality assurance policies, terms and
15		conditions of plans and plan policy with enrollees, prospective
16		enrollees, providers, or the public.
17		(b) No health care plan by contract, written policy, or
18		procedure may permit or allow an individual or entity to
19		dispense a different drug in place of the drug or brand of drug
20		ordered or prescribed without the express permission of the
21		person ordering or prescribing the drug, except as provided
22		under Section 3.14 of the Illinois Food, Drug and Cosmetic Act.
23		(c) No health care plan or its subcontractors may by
24		contract, written policy, procedure, or otherwise mandate or
25		require an enrollee to substitute his or her participating

HB0465 Engrossed - 44 - LRB101 03398 JRG 48406 b
1		primary care physician under the plan during inpatient
2		hospitalization, such as with a hospitalist physician licensed
3		to practice medicine in all its branches, without the agreement
4		of that enrollee's participating primary care physician.
5		"Participating primary care physician" for health care plans
6		and subcontractors that do not require coordination of care by
7		a primary care physician means the participating physician
8		treating the patient. All health care plans shall inform
9		enrollees of any policies, recommendations, or guidelines
10		concerning the substitution of the enrollee's primary care
11		physician when hospitalization is necessary in the manner set
12		forth in subsections (d) and (e) of Section 15.
13		(d) A health care plan shall apply any third-party
14		payments, financial assistance, discount, product vouchers, or
15		any other reduction in out-of-pocket expenses made by or on
16		behalf of such insured for prescription drugs toward a covered
17		individual's deductible, copay, or cost-sharing
18		responsibility, or out-of-pocket maximum associated with the
19		individual's health insurance.
20		(e) (d) Any violation of this Section shall be subject to
21		the penalties under this Act.
22		(Source: P.A. 94-866, eff. 6-16-06.)
23		Section 25. The Pharmacy Practice Act is amended by adding
24		Section 42 as follows:

HB0465 Engrossed - 45 - LRB101 03398 JRG 48406 b
1		(225 ILCS 85/42 new)
2		Sec. 42. Information disclosure. A pharmacist or her or his
3		authorized employee must inform customers of a less expensive,
4		generically equivalent drug product for her or his prescription
5		and whether the cost-sharing obligation to the customer exceeds
6		the retail price of the prescription in the absence of
7		prescription drug coverage.
8		Section 30. The Illinois Public Aid Code is amended by
9		adding Section 5-36 as follows:
10		(305 ILCS 5/5-36 new)
11		Sec. 5-36. Pharmacy benefits.
12		(a)(1) The Department may enter into a contract with a
13		third party on a fee-for-service reimbursement model for the
14		purpose of administering pharmacy benefits as provided in this
15		Section for members not enrolled in a Medicaid managed care
16		organization; however, these services shall be approved by the
17		Department. The Department shall ensure coordination of care
18		between the third-party administrator and managed care
19		organizations as a consideration in any contracts established
20		in accordance with this Section. Any managed care techniques,
21		principles, or administration of benefits utilized in
22		accordance with this subsection shall comply with State law.
23		(2) The following shall apply to contracts between entities
24		contracting relating to the Department's third-party

HB0465 Engrossed - 46 - LRB101 03398 JRG 48406 b
1		administrators and pharmacies:
2		(A) the Department shall approve any contract between a
3		third-party administrator and a pharmacy;
4		(B) the Department's third-party administrator shall
5		not change the terms of a contract between a third-party
6		administrator and a pharmacy without written approval by
7		the Department; and
8		(C) the Department's third-party administrator shall
9		not create, modify, implement, or indirectly establish any
10		fee on a pharmacy, pharmacist, or a recipient of medical
11		assistance without written approval by the Department.
12		(b) The provisions of this Section shall not apply to
13		outpatient pharmacy services provided by a health care facility
14		registered as a covered entity pursuant to 42 U.S.C. 256b or
15		any pharmacy owned by or contracted with the covered entity. A
16		Medicaid managed care organization shall, either directly or
17		through a pharmacy benefit manager, administer and reimburse
18		outpatient pharmacy claims submitted by a health care facility
19		registered as a covered entity pursuant to 42 U.S.C. 256b, its
20		owned pharmacies, and contracted pharmacies in accordance with
21		the contractual agreements the Medicaid managed care
22		organization or its pharmacy benefit manager has with such
23		facilities and pharmacies. Any pharmacy benefit manager that
24		contracts with a Medicaid managed care organization to
25		administer and reimburse pharmacy claims as provided in this
26		Section must be registered with the Director of Insurance in

HB0465 Engrossed - 47 - LRB101 03398 JRG 48406 b
1		accordance with Section 513b2 of the Illinois Insurance Code.
2		(c) On at least an annual basis, the Director of the
3		Department of Healthcare and Family Services shall submit a
4		report beginning no later than one year after the effective
5		date of this amendatory Act of the 101st General Assembly that
6		provides an update on any contract, contract issues, formulary,
7		dispensing fees, and maximum allowable cost concerns regarding
8		a third-party administrator and managed care. The requirement
9		for reporting to the General Assembly shall be satisfied by
10		filing copies of the report with the Speaker, the Minority
11		Leader, and the Clerk of the House of Representatives and with
12		the President, the Minority leader, and the Secretary of the
13		Senate. The Department shall take care that no proprietary
14		information is included in the report required under this
15		Section.
16		(d) A pharmacy benefit manager shall notify the Department
17		in writing of any activity, policy, or practice of the pharmacy
18		benefit manager that directly or indirectly presents a conflict
19		of interest that interferes with the discharge of the pharmacy
20		benefit manager's duty to a managed care organization to
21		exercise its contractual duties. "Conflict of interest" shall
22		be defined by rule by the Department.
23		(e) A pharmacy benefit manager shall, upon request,
24		disclose to the Department the following information:
25		(1) whether the pharmacy benefit manager has a
26		contract, agreement, or other arrangement with a

HB0465 Engrossed - 48 - LRB101 03398 JRG 48406 b
1		pharmaceutical manufacturer to exclusively dispense or
2		provide a drug to a managed care organization's enrollees,
3		and the aggregate amounts of consideration of economic
4		benefits collected or received pursuant to that
5		arrangement;
6		(2) the percentage of claims payments made by the
7		pharmacy benefit manager to pharmacies owned, managed, or
8		controlled by the pharmacy benefit manager or any of the
9		pharmacy benefit manager's management companies, parent
10		companies, subsidiary companies, or jointly held
11		companies;
12		(3) the aggregate amount of the fees or assessments
13		imposed on, or collected from, pharmacy providers; and
14		(4) the average annualized percentage of revenue
15		collected by the pharmacy benefit manager as a result of
16		each contract it has executed with a managed care
17		organization contracted by the Department to provide
18		medical assistance benefits which is not paid by the
19		pharmacy benefit manager to pharmacy providers and
20		pharmaceutical manufacturers or labelers or in order to
21		perform administrative functions pursuant to its contracts
22		with managed care organizations.
23		(f) The information disclosed under subsection (e) shall
24		include all retail, mail order, specialty, and compounded
25		prescription products. All information made available to the
26		Department under subsection (e) is confidential and not subject

HB0465 Engrossed - 49 - LRB101 03398 JRG 48406 b
1		to disclosure under the Freedom of Information Act. All
2		information made available to the Department under subsection
3		(e) shall not be reported or distributed in any way that
4		compromises its competitive, proprietary, or financial value.
5		The information shall only be used by the Department to assess
6		the contract, agreement, or other arrangements made between a
7		pharmacy benefit manager and a pharmacy provider,
8		pharmaceutical manufacturer or labeler, managed care
9		organization, or other entity, as applicable.
10		(g) A pharmacy benefit manager shall disclose directly in
11		writing to a pharmacy provider or pharmacy services
12		administrative organization contracting with the pharmacy
13		benefit manager of any material change to a contract provision
14		that affects the terms of the reimbursement, the process for
15		verifying benefits and eligibility, dispute resolution,
16		procedures for verifying drugs included on the formulary, and
17		contract termination at least 30 days prior to the date of the
18		change to the provision. The terms of this subsection shall be
19		deemed met if the pharmacy benefit manager posts the
20		information on a website, viewable by the public. A pharmacy
21		service administration organization shall notify all contract
22		pharmacies of any material change, as described in this
23		subsection, within 2 days of notification. As used in this
24		Section, "pharmacy services administrative organization" means
25		an entity operating within the State that contracts with
26		independent pharmacies to conduct business on their behalf with

HB0465 Engrossed - 50 - LRB101 03398 JRG 48406 b
1		third-party payers. A pharmacy services administrative
2		organization may provide administrative services to pharmacies
3		and negotiate and enter into contracts with third-party payers
4		or pharmacy benefit managers on behalf of pharmacies.
5		(h) A pharmacy benefit manager shall not include the
6		following in a contract with a pharmacy provider:
7		(1) a provision prohibiting the provider from
8		informing a patient of a less costly alternative to a
9		prescribed medication; or
10		(2) a provision that prohibits the provider from
11		dispensing a particular amount of a prescribed medication,
12		if the pharmacy benefit manager allows that amount to be
13		dispensed through a pharmacy owned or controlled by the
14		pharmacy benefit manager, unless the prescription drug is
15		subject to restricted distribution by the United States
16		Food and Drug Administration or requires special handling,
17		provider coordination, or patient education that cannot be
18		provided by a retail pharmacy.
19		(i) Nothing in this Section shall be construed to prohibit
20		a pharmacy benefit manager from requiring the same
21		reimbursement and terms and conditions for a pharmacy provider
22		as for a pharmacy owned, controlled, or otherwise associated
23		with the pharmacy benefit manager.
24		(j) A pharmacy benefit manager shall establish and
25		implement a process for the resolution of disputes arising out
26		of this Section, which shall be approved by the Department.

HB0465 Engrossed - 51 - LRB101 03398 JRG 48406 b
1		(k) The Department shall adopt rules establishing
2		reasonable dispensing fees for fee-for-service payments in
3		accordance with guidance or guidelines from the federal Centers
4		for Medicare and Medicaid Services.