House Bill hb1373
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Florida House of Representatives - 2001 HB 1373
By Representative Green
1 A bill to be entitled
2 An act relating to health insurance; amending
3 s. 627.6482, F.S.; amending definitions used in
4 the Florida Comprehensive Health Association
5 Act; amending s. 627.6486, F.S.; revising the
6 criteria for eligibility for coverage from the
7 association; providing for cessation of
8 coverage; requiring all eligible persons to
9 agree to be placed in a case-management system;
10 amending s. 627.6487, F.S.; redefining the term
11 "eligible individual" for purposes of
12 guaranteed availability of individual health
13 insurance coverage; providing that a person is
14 not eligible if the person is eligible for
15 coverage under the Florida Comprehensive Health
16 Association; amending s. 627.6488, F.S.;
17 revising the membership of the board of
18 directors of the association; revising the
19 reimbursement of board members; requiring that
20 the plan of the association be submitted to the
21 department for approval on an annual basis;
22 revising the duties of the association related
23 to administrative and accounting procedures;
24 requiring an annual audit; specifying grievance
25 procedures; deleting requirements for
26 categorizing insureds as low-risk, medium-risk,
27 and high-risk; authorizing the association to
28 place an individual with a case manager who
29 determines the health care system or provider;
30 requiring an annual review of the actuarial
31 soundness of the association and the
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1 feasibility of enrolling new members; requiring
2 a separate account for policyholders insured
3 prior to a specified date; requiring
4 appointment of an executive director with
5 specified duties; authorizing the board to
6 restrict the number of participants based on
7 inadequate funding; specifying other powers of
8 the board; amending s. 627.649, F.S.; revising
9 the requirements for the association to use in
10 selecting an administrator; amending s.
11 627.6492, F.S.; requiring insurers to be
12 members of the association and to be subject to
13 assessments for operating expenses; limiting
14 assessments to specified maximum amounts;
15 specifying when assessments are calculated and
16 paid; allowing certain assessments to be
17 charged by the health insurer directly to each
18 insured, member, or subscriber and to not be
19 subject to department review or approval;
20 amending s. 627.6498, F.S.; revising the
21 coverage, benefits, covered expenses, premiums,
22 and deductibles of the association; requiring
23 preexisting condition limitations; providing
24 that the act does not provide an entitlement to
25 health care services or health insurance and
26 does not create a cause of action; repealing s.
27 627.6484, F.S., relating to a prohibition on
28 the Florida Comprehensive Health Association
29 from accepting applications for coverage after
30 a certain date; providing effective dates.
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1 Be It Enacted by the Legislature of the State of Florida:
2
3 Section 1. Subsection (12) of section 627.6482,
4 Florida Statutes, is amended to read:
5 627.6482 Definitions.--As used in ss.
6 627.648-627.6498, the term:
7 (12) "Premium" means the entire cost of an insurance
8 plan, including the administrative fee, the risk assumption
9 charge, and, in the instance of a minimum premium plan or
10 stop-loss coverage, the incurred claims whether or not such
11 claims are paid directly by the insurer. "Premium" shall not
12 include a health maintenance organization's annual earned
13 premium revenue for Medicare and Medicaid contracts for any
14 assessment due for calendar years 1990 and 1991. For
15 assessments due for calendar year 1992 and subsequent years, A
16 health maintenance organization's annual earned premium
17 revenue for Medicare and Medicaid contracts is subject to
18 assessments unless the department determines that the health
19 maintenance organization has made a reasonable effort to amend
20 its Medicare or Medicaid government contract for 1992 and
21 subsequent years to provide reimbursement for any assessment
22 on Medicare or Medicaid premiums paid by the health
23 maintenance organization and the contract does not provide for
24 such reimbursement.
25 Section 2. Section 627.6486, Florida Statutes, is
26 amended to read:
27 627.6486 Eligibility.--
28 (1) Except as provided in subsection (2), any person
29 who is a resident of this state and has been a resident of
30 this state for the previous 12 months is shall be eligible for
31 coverage under the plan, including:
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1 (a) The insured's spouse.
2 (b) Any dependent unmarried child of the insured, from
3 the moment of birth. Subject to the provisions of ss. s.
4 627.6041 and 627.6562, such coverage shall terminate at the
5 end of the premium period in which the child marries, ceases
6 to be a dependent of the insured, or attains the age of 19,
7 whichever occurs first. However, if the child is a full-time
8 student at an accredited institution of higher learning, the
9 coverage may continue while the child remains unmarried and a
10 full-time student, but not beyond the premium period in which
11 the child reaches age 23.
12 (c) The former spouse of the insured whose coverage
13 would otherwise terminate because of annulment or dissolution
14 of marriage, if the former spouse is dependent upon the
15 insured for financial support. The former spouse shall have
16 continued coverage and shall not be subject to waiting periods
17 because of the change in policyholder status.
18 (2)(a) The board or administrator shall require
19 verification of residency for the preceding 12 months and
20 shall require any additional information or documentation, or
21 statements under oath, when necessary to determine residency
22 upon initial application and for the entire term of the
23 policy. A person may demonstrate his or her residency by
24 maintaining his or her residence in this state for the
25 preceding 12 months, purchasing a home that has been occupied
26 by him or her as his or her primary residence for the previous
27 12 months, or having established a domicile in this state
28 pursuant to s. 222.17 for the preceding 12 months.
29 (b) No person who is currently eligible for health
30 care benefits under Florida's Medicaid program is eligible for
31 coverage under the plan unless:
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1 1. He or she has an illness or disease which requires
2 supplies or medication which are covered by the association
3 but are not included in the benefits provided under Florida's
4 Medicaid program in any form or manner; and
5 2. He or she is not receiving health care benefits or
6 coverage under Florida's Medicaid program.
7 (c) No person who is covered under the plan and
8 terminates the coverage is again eligible for coverage.
9 (d) No person on whose behalf the plan has paid out
10 the lifetime maximum benefit currently being offered by the
11 association $500,000 in covered benefits is eligible for
12 coverage under the plan.
13 (e) The coverage of any person who ceases to meet the
14 eligibility requirements of this section may be terminated
15 immediately. If such person again becomes eligible for
16 subsequent coverage under the plan, any previous claims
17 payments shall be applied towards the $500,000 lifetime
18 maximum benefit and any limitation relating to preexisting
19 conditions in effect at the time such person again becomes
20 eligible shall apply to such person. However, no such person
21 may again become eligible for coverage after June 30, 1991.
22 (f) No person is eligible for coverage under the plan
23 unless such person has been rejected by two insurers for
24 coverage substantially similar to the plan coverage and no
25 insurer has been found through the market assistance plan
26 pursuant to s. 627.6484 that is willing to accept the
27 application. As used in this paragraph, "rejection" includes
28 an offer of coverage with a material underwriting restriction
29 or an offer of coverage at a rate greater than the association
30 plan rate.
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1 (g) No person is eligible for coverage under the plan
2 if such person has, or is eligible for, on the date of issue
3 of coverage under the plan, substantially similar coverage
4 under another contract or policy, unless such coverage is
5 provided pursuant to the Consolidated Omnibus Budget
6 Reconciliation Act of 1985, Pub. L. No. 99-272, 100 Stat. 82
7 (1986) (COBRA), as amended, or such coverage is provided
8 pursuant to s. 627.6692 and such coverage is scheduled to end
9 at a time certain and the person meets all other requirements
10 of eligibility. Coverage provided by the association shall be
11 secondary to any coverage provided by an insurer pursuant to
12 COBRA or pursuant to s. 627.6692.
13 (h) A person is ineligible for coverage under the plan
14 if such person is currently eligible for health care benefits
15 under the Medicare programs, except for a person who is
16 insured by the Florida Comprehensive Health Association and
17 enrolled under Medicare on July 1, 2001. All eligible persons
18 who are classified as high-risk individuals pursuant to s.
19 627.6498(4)(a)4. shall, upon application or renewal, agree to
20 be placed in a case management system when it is determined by
21 the board and the plan case manager that such system will be
22 cost-effective and provide quality care to the individual.
23 (i) A person is ineligible for coverage under the plan
24 if such person's premiums are paid for or reimbursed under any
25 government-sponsored program or by any government agency or
26 health care provider.
27 (j) An eligible individual, as defined in s. 627.6487,
28 and his or her dependents, as described in subsection (1), are
29 automatically eligible for coverage in the association unless
30 the association has ceased accepting new enrollees under s.
31 627.6488. If the association has ceased accepting new
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1 enrollees, the eligible individual is subject to the coverage
2 rights set forth in s. 627.6487.
3 (3) A person's coverage ceases:
4 (a) On the date a person is no longer a resident of
5 this state;
6 (b) On the date a person requests coverage to end;
7 (c) Upon the date of death of the covered person;
8 (d) On the date state law requires cancellation of the
9 policy; or
10 (e) Sixty days after the person receives notice from
11 the association making any inquiry concerning the person's
12 eligibility or place or residence to which the person does not
13 reply.
14 (4) All eligible persons must, upon application or
15 renewal, agree to be placed in a case-management system when
16 the association and case manager find that such system will be
17 cost-effective and provide quality care to the individual.
18 (5) Except for persons who are insured by the
19 association on December 31, 2001, and who renew such coverage,
20 persons may apply for coverage beginning January 1, 2002, and
21 coverage for such persons shall begin on or after April 1,
22 2002, as determined by the board pursuant to s.
23 627.6488(5)(e).
24 Section 3. Subsection (3) of section 627.6487, Florida
25 Statutes, is amended to read:
26 627.6487 Guaranteed availability of individual health
27 insurance coverage to eligible individuals.--
28 (3) For the purposes of this section, the term
29 "eligible individual" means an individual:
30 (a)1. For whom, as of the date on which the individual
31 seeks coverage under this section, the aggregate of the
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1 periods of creditable coverage, as defined in s. 627.6561(5)
2 and (6), is 18 or more months; and
3 2.a. Whose most recent prior creditable coverage was
4 under a group health plan, governmental plan, or church plan,
5 or health insurance coverage offered in connection with any
6 such plan; or
7 b. Whose most recent prior creditable coverage was
8 under an individual plan issued in this state by a health
9 insurer or health maintenance organization, which coverage is
10 terminated due to the insurer or health maintenance
11 organization becoming insolvent or discontinuing the offering
12 of all individual coverage in the State of Florida, or due to
13 the insured no longer living in the service area in the State
14 of Florida of the insurer or health maintenance organization
15 that provides coverage through a network plan in the State of
16 Florida;
17 (b) Who is not eligible for coverage under:
18 1. A group health plan, as defined in s. 2791 of the
19 Public Health Service Act;
20 2. A conversion policy or contract issued by an
21 authorized insurer or health maintenance organization under s.
22 627.6675 or s. 641.3921, respectively, offered to an
23 individual who is no longer eligible for coverage under either
24 an insured or self-insured employer plan;
25 3. Part A or part B of Title XVIII of the Social
26 Security Act; or
27 4. A state plan under Title XIX of such act, or any
28 successor program, and does not have other health insurance
29 coverage; or
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1 5. The Florida Comprehensive Health Association, if
2 the association is accepting and issuing coverage to new
3 enrollees;
4 (c) With respect to whom the most recent coverage
5 within the coverage period described in paragraph (a) was not
6 terminated based on a factor described in s. 627.6571(2)(a) or
7 (b), relating to nonpayment of premiums or fraud, unless such
8 nonpayment of premiums or fraud was due to acts of an employer
9 or person other than the individual;
10 (d) Who, having been offered the option of
11 continuation coverage under a COBRA continuation provision or
12 under s. 627.6692, elected such coverage; and
13 (e) Who, if the individual elected such continuation
14 provision, has exhausted such continuation coverage under such
15 provision or program.
16 Section 4. Section 627.6488, Florida Statutes, is
17 amended to read:
18 627.6488 Florida Comprehensive Health Association.--
19 (1) There is created a nonprofit legal entity to be
20 known as the "Florida Comprehensive Health Association." All
21 insurers, as a condition of doing business, shall be members
22 of the association.
23 (2)(a) The association shall operate subject to the
24 supervision and approval of a five-member three-member board
25 of directors consisting of the Insurance Commissioner, or his
26 or her designee, who shall serve as chairperson of the board,
27 and four additional members who must be state residents. At
28 least one member must be a representative of an authorized
29 health insurer or health maintenance organization authorized
30 to transact business in this state. The board of directors
31 shall be appointed by the Insurance Commissioner as follows:
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1 1. The chair of the board shall be the Insurance
2 Commissioner or his or her designee.
3 2. One representative of policyholders who is not
4 associated with the medical profession, a hospital, or an
5 insurer.
6 3. One representative of insurers.
7
8 The administrator or his or her affiliate shall not be a
9 member of the board. Any board member appointed by the
10 commissioner may be removed and replaced by him or her at any
11 time without cause.
12 (b) All board members, including the chair, shall be
13 appointed to serve for staggered 3-year terms beginning on a
14 date as established in the plan of operation.
15 (c) The board of directors may shall have the power to
16 employ or retain such persons as are necessary to perform the
17 administrative and financial transactions and responsibilities
18 of the association and to perform other necessary and proper
19 functions not prohibited by law.
20 (d) Board members may be reimbursed from moneys of the
21 association for actual and necessary expenses incurred by them
22 as members in carrying out their responsibilities under the
23 Florida Comprehensive Health Association Act, as provided in
24 s. 112.061, but may not otherwise be compensated for their
25 services.
26 (e) There shall be no liability on the part of, and no
27 cause of action of any nature shall arise against, any member
28 insurer, or its agents or employees, agents or employees of
29 the association, members of the board of directors of the
30 association, or the departmental representatives for any act
31 or omission taken by them in the performance of their powers
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1 and duties under this act, unless such act or omission by such
2 person is in intentional disregard of the rights of the
3 claimant.
4 (f) Meetings of the board are subject to s. 286.011.
5 (3) The association shall adopt a plan pursuant to
6 this act and submit its articles, bylaws, and operating rules
7 to the department for approval. If the association fails to
8 adopt such plan and suitable articles, bylaws, and operating
9 rules within 180 days after the appointment of the board, the
10 department shall adopt rules to effectuate the provisions of
11 this act; and such rules shall remain in effect until
12 superseded by a plan and articles, bylaws, and operating rules
13 submitted by the association and approved by the department.
14 Such plan shall be reviewed, revised as necessary, and
15 annually submitted to the department for approval.
16 (4) The association shall:
17 (a) Establish competitive administrative and
18 accounting procedures and internal controls for the operation
19 of the association and provide for an annual audit of the
20 financial statements by an independent certified public
21 accountant.
22 (b) Establish procedures under which applicants and
23 participants in the plan may have grievances reviewed by an
24 impartial body and reported to the board. Individuals
25 receiving care through the association under contract from a
26 health maintenance organization must follow the grievance
27 procedures established in ss. 408.7056 and 641.31(5).
28 (c) Select an administrator in accordance with s.
29 627.649.
30 (d) Collect assessments from all insurers to provide
31 for operating losses incurred or estimated to be incurred
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1 during the period for which the assessment is made. The level
2 of payments shall be established by the board, as formulated
3 in s. 627.6492(1). Annual assessment of the insurers for each
4 calendar year shall occur as soon thereafter as the operating
5 results of the plan for the calendar year and the earned
6 premiums of insurers being assessed for that year are known.
7 Annual assessments are due and payable within 30 days of
8 receipt of the assessment notice by the insurer.
9 (e) Require that all policy forms issued by the
10 association conform to standard forms developed by the
11 association. The forms shall be approved by the department.
12 (f) Develop and implement a program to publicize the
13 existence of the plan, the eligibility requirements for the
14 plan, and the procedures for enrollment in the plan and to
15 maintain public awareness of the plan.
16 (g) Design and employ cost containment measures and
17 requirements which may include preadmission certification,
18 home health care, hospice care, negotiated purchase of medical
19 and pharmaceutical supplies, and individual case management.
20 (h) Contract with preferred provider organizations and
21 health maintenance organizations giving due consideration to
22 the preferred provider organizations and health maintenance
23 organizations which have contracted with the state group
24 health insurance program pursuant to s. 110.123. If
25 cost-effective and available in the county where the
26 policyholder resides, the board, upon application or renewal
27 of a policy, shall place a high-risk individual, as
28 established under s. 627.6498(4)(a)4., with the plan case
29 manager who shall determine the most cost-effective quality
30 care system or health care provider and shall place the
31 individual in such system or with such health care provider.
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1 If cost-effective and available in the county where the
2 policyholder resides, the board, with the consent of the
3 policyholder, may place a low-risk or medium-risk individual,
4 as established under s. 627.6498(4)(a)4., with the plan case
5 manager who may determine the most cost-effective quality care
6 system or health care provider and shall place the individual
7 in such system or with such health care provider. Prior to and
8 during the implementation of case management, the plan case
9 manager shall obtain input from the policyholder, parent, or
10 guardian.
11 (h)(i) Make a report to the Governor, the President of
12 the Senate, the Speaker of the House of Representatives, and
13 the Minority Leaders of the Senate and the House of
14 Representatives not later than October 1 of each year. The
15 report shall summarize the activities of the plan for the
16 12-month period ending July 1 of that year, including
17 then-current data and estimates as to net written and earned
18 premiums, the expense of administration, and the paid and
19 incurred losses for the year. The report shall also include
20 analysis and recommendations for legislative changes regarding
21 utilization review, quality assurance, an evaluation of the
22 administrator of the plan, access to cost-effective health
23 care, and cost containment/case management policy and
24 recommendations concerning the opening of enrollment to new
25 entrants as of July 1, 1992.
26 (i)(j) Make a report to the Governor, the Insurance
27 Commissioner, the President of the Senate, the Speaker of the
28 House of Representatives, and the Minority Leaders of the
29 Senate and House of Representatives, not later than 45 days
30 after the close of each calendar quarter, which includes, for
31 the prior quarter, current data and estimates of net written
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1 and earned premiums, the expenses of administration, and the
2 paid and incurred losses. The report shall identify any
3 statutorily mandated program that has not been fully
4 implemented by the board.
5 (j)(k) To facilitate preparation of assessments and
6 for other purposes, the board shall direct preparation of
7 annual audited financial statements for each calendar year as
8 soon as feasible following the conclusion of that calendar
9 year, and shall, within 30 days after rendition of such
10 statements, file with the department the annual report
11 containing such information as required by the department to
12 be filed on March 1 of each year.
13 (k)(l) Employ a plan case manager or managers to
14 supervise and manage the medical care or coordinate the
15 supervision and management of the medical care, with the
16 administrator, of specified individuals. The plan case
17 manager, with the approval of the board, shall have final
18 approval over the case management for any specific individual.
19 If cost-effective and available in the county where the
20 policyholder resides, the association, upon application or
21 renewal of a policy, may place an individual with the plan
22 case manager, who shall determine the most cost-effective
23 quality care system or health care provider and shall place
24 the individual in such system or with such health care
25 provider. Prior to and during the implementation of case
26 management, the plan case manager shall obtain input from the
27 policyholder, parent, or guardian and the health care
28 providers and shall:
29 (l) Administer the association in a fiscally
30 responsible manner that ensures that its expenditures are
31 reasonable in relation to the services provided and that the
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1 financial resources of the association are adequate to meet
2 its obligations.
3 (m) At least annually, but no more than quarterly,
4 evaluate or cause to be evaluated the actuarial soundness of
5 the association. The association shall contract with an
6 actuary to evaluate the pool of insureds in the association
7 and monitor the financial condition of the association. The
8 actuary shall determine the feasibility of enrolling new
9 members in the association, which must be based on the
10 projected revenues and expenses of the association.
11 (n) Restrict at any time the number of participants in
12 the association based on a determination by the board that the
13 revenues will be inadequate to fund new participants. However,
14 any person denied participation solely on the basis of such
15 restriction must be granted priority for participation in the
16 succeeding period in which the association is reopened for
17 participants.
18 (o) Establish procedures to maintain separate accounts
19 and recordkeeping for policyholders prior to January 1, 2002,
20 and policyholders issued coverage on and after January 1,
21 2002.
22 (p) Appoint an executive director to serve as the
23 chief administrative and operational officer of the
24 association and operate within the specifications of the plan
25 of operation and perform other duties assigned to him or her
26 by the board.
27 (q) Develop and promote one or more pilot programs to
28 expand health-care options for lower-income, uninsured state
29 residents. In administering the pilot program, the
30 association:
31 1. Shall limit eligibility to state residents who:
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1 a. Are 64 years of age or younger;
2 b. Have a family income of less than 200 percent of
3 the federal poverty level;
4 c. Are not covered by any other private coverage or
5 public health care program and have not been covered at any
6 time during the previous 6 months;
7 d. Request to obtain the affordable health-care
8 option; and
9 e. Agree to make payments required for participation,
10 including periodic payments or payments due at the time the
11 health care services are provided.
12 2. Shall emphasize basic and preventive health care
13 services and shall consider cost-containment measures and
14 coverages to make the program affordable by eligible state
15 residents.
16 3. May integrate the pilot program with other
17 governmental or community-based programs in a manner that is
18 consistent with the objectives and requirements of the pilot
19 program.
20 4. May limit or exclude benefits otherwise required by
21 law for insurers offering coverage in this state.
22 5. May contract with community-based programs,
23 provider-sponsored organizations, health insurers, or health
24 maintenance organizations to provide or administer all or a
25 portion of a pilot program.
26 6. Shall include the pilot program in the
27 association's operating plan by 2003.
28 7. Shall submit the forms and rates and program
29 structure of the pilot program for approval by the department.
30 8. Shall design the pilot program to be financially
31 self-sufficient.
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1 (5) The association may:
2 (a) Exercise powers granted to insurers under the laws
3 of this state.
4 (b) Sue or be sued.
5 (c) In addition to imposing annual assessments under
6 paragraph (4)(d), levy interim assessments against insurers to
7 ensure the financial ability of the plan to cover claims
8 expenses and administrative expenses paid or estimated to be
9 paid in the operation of the plan for a calendar year prior to
10 the association's anticipated receipt of annual assessments
11 for that calendar year. Any interim assessment shall be due
12 and payable within 30 days after of receipt by an insurer of
13 an interim assessment notice. Interim assessment payments
14 shall be credited against the insurer's annual assessment.
15 Such assessments may be levied only for costs and expenses
16 associated with policyholders insured with the association
17 prior to January 1, 2002.
18 (d) Prepare or contract for a performance audit of the
19 administrator of the association.
20 (e) Appear in its own behalf before boards,
21 commissions, or other governmental agencies.
22 (f) Solicit and accept gifts, grants, loans, and other
23 aid from any source or participate in any way in any
24 government program to carry out the purposes of the Florida
25 Comprehensive Health Association Act.
26 (g) Require and collect administrative fees and
27 charges in connection with any transaction and impose
28 reasonable penalties, including default, for delinquent
29 payments or for entering into the association on a fraudulent
30 basis.
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1 (h) Procure insurance against any loss in connection
2 with the property, assets, and activities of the association
3 or the board.
4 (i) Contract for necessary goods and services; employ
5 necessary personnel; and engage the services of private
6 consultants, actuaries, managers, legal counsel, and
7 independent certified public accountants for administrative or
8 technical assistance.
9 (6) The department shall examine and investigate the
10 association in the manner provided in part II of chapter 624.
11 Section 5. Paragraph (b) of subsection (3) of section
12 627.649, Florida Statutes, is amended to read:
13 627.649 Administrator.--
14 (3) The administrator shall:
15 (b) Pay an agent's referral fee as established by the
16 board to each insurance agent who refers an applicant to the
17 plan, if the applicant's application is accepted. The selling
18 or marketing of plans shall not be limited to the
19 administrator or its agents. Any agent must be licensed by the
20 department to sell health insurance in this state. The
21 referral fees shall be paid by the administrator from moneys
22 received as premiums for the plan.
23 Section 6. Section 627.6492, Florida Statutes, is
24 amended to read:
25 627.6492 Participation of insurers.--
26 (1)(a) As a condition of doing business in this state
27 an insurer shall pay an assessment to the board, in the amount
28 prescribed by this section. Subsections (1), (2), and (3)
29 apply only to the costs and expenses associated with
30 policyholders insured with the association prior to January 1,
31 2002, including renewal of coverage for such policyholders
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1 after that date. For operating losses incurred in any
2 calendar year on July 1, 1991, and thereafter, each insurer
3 shall annually be assessed by the board in the following
4 calendar year a portion of such incurred operating losses of
5 the plan; such portion shall be determined by multiplying such
6 operating losses by a fraction, the numerator of which equals
7 the insurer's earned premium pertaining to direct writings of
8 health insurance in the state during the calendar year
9 preceding that for which the assessment is levied, and the
10 denominator of which equals the total of all such premiums
11 earned by participating insurers in the state during such
12 calendar year.
13 (b) For operating losses incurred from July 1, 1991,
14 through December 31, 1991, the total of all assessments upon a
15 participating insurer shall not exceed .375 percent of such
16 insurer's health insurance premiums earned in this state
17 during 1990. For operating losses incurred in 1992 and
18 thereafter, The total of all assessments upon a participating
19 insurer shall not exceed 1 percent of such insurer's health
20 insurance premium earned in this state during the calendar
21 year preceding the year for which the assessments were levied.
22 (c) For operating losses incurred from October 1,
23 1990, through June 30, 1991, the board shall assess each
24 insurer in the amount and manner prescribed by chapter 90-334,
25 Laws of Florida. The maximum assessment against an insurer, as
26 provided in such act, shall apply separately to the claims
27 incurred in 1990 (October 1 through December 31) and the
28 claims incurred in 1991 (January 1 through June 30). For
29 operating losses incurred on January 1, 1991, through June 30,
30 1991, the maximum assessment against an insurer shall be
31 one-half of the amount of the maximum assessment specified for
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1 such insurer in former s. 627.6492(1)(b), 1990 Supplement, as
2 amended by chapter 90-334, Laws of Florida.
3 (c)(d) All rights, title, and interest in the
4 assessment funds collected shall vest in this state. However,
5 all of such funds and interest earned shall be used by the
6 association to pay claims and administrative expenses.
7 (2) If assessments and other receipts by the
8 association, board, or administrator exceed the actual losses
9 and administrative expenses of the plan, the excess shall be
10 held at interest and used by the board to offset future
11 losses. As used in this subsection, the term "future losses"
12 includes reserves for claims incurred but not reported.
13 (3) Each insurer's assessment shall be determined
14 annually by the association based on annual statements and
15 other reports deemed necessary by the association and filed
16 with it by the insurer. Any deficit incurred under the plan
17 shall be recouped by assessments against participating
18 insurers by the board in the manner provided in subsection
19 (1); and the insurers may recover the assessment in the normal
20 course of their respective businesses without time limitation.
21 (4)(a) This subsection applies only to those costs and
22 expenses of the association related to persons whose coverage
23 begins after January 1, 2002. As a condition of doing business
24 in this state, every insurer shall pay an amount determined by
25 the board of up to $1 per month for each individual policy or
26 insured group member or subscriber insured in this state under
27 a health insurance policy or certificate that is issued for a
28 resident of this state.
29 (b) For purposes of this subsection, health insurance
30 does not include accident only, specified disease, individual
31 hospital indemnity, credit, dental-only, vision-only, Medicare
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1 supplement, long-term care, nursing home care, home health
2 care, community-based care, or disability income insurance;
3 similar supplemental plans provided under a separate policy,
4 certificate, or contract of insurance, which cannot duplicate
5 coverage under an underlying health plan and are specifically
6 designed to fill gaps in the underlying health plan,
7 coinsurance, or deductibles; any policy covering
8 medical-payment coverage or personal injury protection
9 coverage in a motor vehicle policy; coverage issued as a
10 supplement to liability insurance; or workers' compensation
11 insurance. For the purposes of this subsection, the term
12 "insurer" also includes third-party administrators
13 administering self-insured health benefit plans in this state
14 where such plans provide benefits consistent with the
15 definition of health insurance. Each covered group member or
16 subscriber shall be counted only once with respect to any
17 assessment. For that purpose, the board shall allow an excess
18 or stop-loss insurer to exclude from its number of covered
19 group members or subscribers those who have been counted by
20 the primary insurer or third-party administrator for the
21 purpose of determining its assessment under this subsection.
22 (c) The calculation shall be determined as of December
23 31 of each year and shall include all policies and group
24 members or subscribers insured at any time during the year,
25 calculated for each month of coverage. The payment is payable
26 to the association no later than April 1 of the subsequent
27 year. The first payment shall be forwarded to the association
28 no later than April 1, 2002, covering the period of October 1,
29 2001, through December 31, 2001.
30 (d) The payment of such funds shall be submitted to
31 the association accompanied by a form prescribed by the
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1 association and adopted in the plan of operation. The form
2 shall identify the number of covered lives for different types
3 of health insurance products and the number of months of
4 coverage.
5 (e) Beginning October 1, 2001, the fee paid to the
6 association may be charged by the health insurer directly to
7 each policyholder, insured member, or subscriber and is not
8 part of the premium subject to the department's review and
9 approval.
10 Section 7. Section 627.6498, Florida Statutes, is
11 amended to read:
12 627.6498 Minimum benefits coverage; exclusions;
13 premiums; deductibles.--
14 (1) COVERAGE OFFERED.--
15 (a) The plan shall offer in an annually a semiannually
16 renewable policy the coverage specified in this section for
17 each eligible person. For applications accepted on or after
18 June 7, 1991, but before July 1, 1991, coverage shall be
19 effective on July 1, 1991, and shall be renewable on January
20 1, 1992, and every 6 months thereafter. Policies in existence
21 on June 7, 1991, shall, upon renewal, be for a term of less
22 than 6 months that terminates and becomes subject to
23 subsequent renewal on the next succeeding January 1 or July 1,
24 whichever is sooner.
25 (b) If an eligible person is also eligible for
26 Medicare coverage, the plan shall not pay or reimburse any
27 person for expenses paid by Medicare.
28 (c) Any person whose health insurance coverage is
29 involuntarily terminated for any reason other than nonpayment
30 of premium may apply for coverage under the plan. If such
31 coverage is applied for within 60 days after the involuntary
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1 termination and if premiums are paid for the entire period of
2 coverage, the effective date of the coverage shall be the date
3 of termination of the previous coverage.
4 (b)(d) The plan shall provide that, upon the death or
5 divorce of the individual in whose name the contract was
6 issued, every other person then covered in the contract may
7 elect within 60 days to continue under the same or a different
8 contract.
9 (c)(e) No coverage provided to a person who is
10 eligible for Medicare benefits shall be issued as a Medicare
11 supplement policy as defined in s. 627.672.
12 (2) BENEFITS.--
13 (a) The plan must offer coverage to every eligible
14 person subject to limitations set by the association. The
15 coverage offered must pay an eligible person's covered
16 expenses, subject to limits on the deductible and coinsurance
17 payments authorized under subsection (4). However,
18 policyholders of association policies issued prior to 1992 are
19 entitled to continued coverage at the benefit level
20 established prior to January 1, 2002. Only the premium,
21 deductible, and coinsurance amounts may be modified as
22 determined necessary by the board. The plan shall offer major
23 medical expense coverage similar to that provided by the state
24 group health insurance program as defined in s. 110.123 except
25 as specified in subsection (3) to every eligible person who is
26 not eligible for Medicare. Major medical expense coverage
27 offered under the plan shall pay an eligible person's covered
28 expenses, subject to limits on the deductible and coinsurance
29 payments authorized under subsection (4), up to a lifetime
30 limit of $500,000 per covered individual. The maximum limit
31 under this paragraph shall not be altered by the board, and no
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1 actuarially equivalent benefit may be substituted by the
2 board.
3 (b) The plan shall provide that any policy issued to a
4 person eligible for Medicare shall be separately rated to
5 reflect differences in experience reasonably expected to occur
6 as a result of Medicare payments.
7 (3) COVERED EXPENSES.--
8 (a) The board shall establish the coverage to be
9 issued by the association.
10 (b) If the coverage is being issued to an eligible
11 individual as defined in s. 627.6487, the individual shall be
12 offered, at the option of the individual, the basic and the
13 standard health benefit plan as established in s. 627.6699.
14 The coverage to be issued by the association shall be
15 patterned after the state group health insurance program as
16 defined in s. 110.123, including its benefits, exclusions, and
17 other limitations, except as otherwise provided in this act.
18 The plan may cover the cost of experimental drugs which have
19 been approved for use by the Food and Drug Administration on
20 an experimental basis if the cost is less than the usual and
21 customary treatment. Such coverage shall only apply to those
22 insureds who are in the case management system upon the
23 approval of the insured, the case manager, and the board.
24 (4) PREMIUMS AND, DEDUCTIBLES, AND COINSURANCE.--
25 (a) The plan shall provide for annual deductibles for
26 major medical expense coverage in the amount of $1,000 or any
27 higher amounts proposed by the board and approved by the
28 department, plus the benefits payable under any other type of
29 insurance coverage or workers' compensation. The schedule of
30 premiums and deductibles shall be established by the board
31 association. With regard to any preferred provider arrangement
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1 utilized by the association, the deductibles provided in this
2 paragraph shall be the minimum deductibles applicable to the
3 preferred providers and higher deductibles, as approved by the
4 department, may be applied to providers who are not preferred
5 providers.
6 (a)1. Separate schedules of premium rates based on age
7 may apply for individual risks.
8 (b)2. Rates are subject to approval by the department
9 pursuant to ss. 627.410 and 627.411, except as provided by
10 this section.
11 3. Standard risk rates for coverages issued by the
12 association shall be established by the department, pursuant
13 to s. 627.6675(3).
14 (c)4. The board shall establish separate premium
15 schedules for low-risk individuals, medium-risk individuals,
16 and high-risk individuals and shall revise premium schedules
17 annually beginning January 2002 1999.
18 (d) No rate shall exceed 200 percent of the standard
19 risk rate, as determined pursuant to s. 627.6675(3). The rate
20 shall be adjusted for benefit differences. for low-risk
21 individuals, 225 percent of the standard risk rate for
22 medium-risk individuals, or 250 percent of the standard risk
23 rate for high-risk individuals. For the purpose of determining
24 what constitutes a low-risk individual, medium-risk
25 individual, or high-risk individual, the board shall consider
26 the anticipated claims payment for individuals based upon an
27 individual's health condition.
28 (b) If the covered costs incurred by the eligible
29 person exceed the deductible for major medical expense
30 coverage selected by the person in a policy year, the plan
31 shall pay in the following manner:
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1 1. For individuals placed under case management, the
2 plan shall pay 90 percent of the additional covered costs
3 incurred by the person during the policy year for the first
4 $10,000, after which the plan shall pay 100 percent of the
5 covered costs incurred by the person during the policy year.
6 2. For individuals utilizing the preferred provider
7 network, the plan shall pay 80 percent of the additional
8 covered costs incurred by the person during the policy year
9 for the first $10,000, after which the plan shall pay 90
10 percent of covered costs incurred by the person during the
11 policy year.
12 3. If the person does not utilize either the case
13 management system or the preferred provider network, the plan
14 shall pay 60 percent of the additional covered costs incurred
15 by the person for the first $10,000, after which the plan
16 shall pay 70 percent of the additional covered costs incurred
17 by the person during the policy year.
18 (5) PREEXISTING CONDITIONS.--An association policy
19 shall may contain provisions under which coverage is excluded
20 during a period of 12 months following the effective date of
21 coverage with respect to a given covered individual for any
22 preexisting condition, as long as:
23 (a) The condition manifested itself within a period of
24 6 months before the effective date of coverage; or
25 (b) Medical advice or treatment was recommended or
26 received within a period of 6 months before the effective date
27 of coverage.
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29 This subsection does not apply to an eligible individual as
30 defined in s. 627.6487.
31 (6) OTHER SOURCES PRIMARY.--
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1 (a) No amounts paid or payable by Medicare or any
2 other governmental program or any other insurance, or
3 self-insurance maintained in lieu of otherwise statutorily
4 required insurance, may be made or recognized as claims under
5 such policy or be recognized as or towards satisfaction of
6 applicable deductibles or out-of-pocket maximums or to reduce
7 the limits of benefits available.
8 (b) The association has a cause of action against a
9 participant for any benefits paid to the participant which
10 should not have been claimed or recognized as claims because
11 of the provisions of this subsection or because otherwise not
12 covered.
13 (7) NONENTITLEMENT.--The Florida Comprehensive Health
14 Association Act does not provide an individual with an
15 entitlement to health care services or health insurance. A
16 cause of action does not arise against the state, the board,
17 or the association for failure to make health services or
18 health insurance available under the Florida Comprehensive
19 Health Association Act.
20 Section 8. Effective January 1, 2002, section
21 627.6484, Florida Statutes, is repealed.
22 Section 9. Except as otherwise expressly provided in
23 this act, this act shall take effect July 1, 2001.
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1 *****************************************
2 LEGISLATIVE SUMMARY
3 Revises various provisions of the Florida Insurance Code
relating to health insurance. Revises criteria for
4 eligibility for coverage under the Florida Comprehensive
Health Association Act. Provides for persons eligible for
5 coverage to be placed in a case-management system if it
is cost-effective. Revises the membership of the board of
6 directors of the Florida Comprehensive Health
Association. Authorizes the board to restrict the number
7 of participants in the association. Provides for insurers
to pay assessments to cover costs and expenses of the
8 association. (See bill for details.)
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