HB 1503

1	A bill to be entitled
2	An act relating to health insurance; amending s. 408.05,
3	F.S.; changing the due date for a report from the Agency
4	for Health Care Administration regarding the State Center
5	for Health Statistics; changing the release dates for
6	certain data collected by the State Center for Health
7	Statistics; amending s. 408.909, F.S.; providing an
8	additional criterion for the Office of Insurance
9	Regulation to disapprove or withdraw approval of health
10	flex plans; amending s. 627.413, F.S.; authorizing
11	insurers and health maintenance organizations to offer
12	policies or contracts providing for a high deductible plan
13	meeting federal requirements and in conjunction with a
14	health savings account; amending s. 627.638, F.S.;
15	providing certain contract and claim form requirements for
16	direct payment to certain providers of emergency services
17	and care; amending s. 627.6402, F.S.; revising provisions
18	for healthy lifestyle rebates for an individual health
19	insurance policy; providing exceptions; providing
20	application; amending s. 627.6487, F.S.; revising the
21	definition of the term "eligible individual" for purposes
22	of obtaining coverage in the Florida Health Insurance
23	Plan; amending s. 627.64872, F.S.; revising definitions;
24	changing references to the Director of the Office of
25	Insurance Regulation to the Commissioner of Insurance
26	Regulation; deleting obsolete language; providing
27	additional eligibility criteria; reducing premium rate
28	limitations; revising requirements for sources of
29	additional revenue; authorizing the board to cancel
30	policies under inadequate funding conditions; providing a
31	limitation; defining the term "health insurance" for
32	purposes of certain assessments; providing an exclusion;
33	specifying a maximum provider reimbursement rate;
34	requiring licensed providers to accept assignment of plan
35	benefits and consider certain payments as payments in
36	full; authorizing the board to update a required actuarial
37	study; providing study criteria; amending s. 627.65626,
38	F.S.; revising criteria for healthy lifestyle rebates for
39	group and similar health insurance policies provided by
40	health insurers; authorizing group or health insurers to
41	contract with an independent third-party administrator for
42	certain purposes; providing exceptions; providing
43	application; amending s. 627.6692, F.S.; extending a time
44	period within which eligible employees may apply for
45	continuation of coverage; amending s. 627.6699, F.S.;
46	revising availability of coverage provision of the
47	Employee Health Care Access Act; including high deductible
48	plans meeting federal health savings account plan
49	requirements; revising membership of the board of the
50	small employer health reinsurance program; revising
51	certain reporting dates relating to program losses and
52	assessments; requiring the board to advise executive and
53	legislative entities on health insurance issues; providing
54	requirements; amending s. 641.27, F.S.; increasing the
55	interval at which the office examines health maintenance
56	organizations; deleting authorization for the office to
57	accept an audit report from a certified public accountant
58	in lieu of conducting its own examination; increasing an
59	expense limitation; amending s. 641.31, F.S.; revising
60	criteria for healthy lifestyle rebates for health
61	maintenance organizations; providing exceptions; providing
62	application; providing an appropriation; providing
63	application; providing an effective date.
64
65	Be It Enacted by the Legislature of the State of Florida:
66
67	Section 1.  Paragraph (l) of subsection (3) of section
68	408.05, Florida Statutes, is amended to read:
69	408.05  State Center for Health Statistics.--
70	(3)  COMPREHENSIVE HEALTH INFORMATION SYSTEM.--In order to
71	produce comparable and uniform health information and
72	statistics, the agency shall perform the following functions:
73	(l)  Develop, in conjunction with the State Comprehensive
74	Health Information System Advisory Council, and implement a
75	long-range plan for making available performance outcome and
76	financial data that will allow consumers to compare health care
77	services. The performance outcomes and financial data the agency
78	must make available shall include, but is not limited to,
79	pharmaceuticals, physicians, health care facilities, and health
80	plans and managed care entities. The agency shall submit the
81	initial plan to the Governor, the President of the Senate, and
82	the Speaker of the House of Representatives by January March 1,
83	2006 2005, and shall update the plan and report on the status of
84	its implementation annually thereafter. The agency shall also
85	make the plan and status report available to the public on its
86	Internet website. As part of the plan, the agency shall identify
87	the process and timeframes for implementation, any barriers to
88	implementation, and recommendations of changes in the law that
89	may be enacted by the Legislature to eliminate the barriers. As
90	preliminary elements of the plan, the agency shall:
91	1.  Make available performance outcome and patient charge
92	data collected from health care facilities pursuant to s.
93	408.061(1)(a) and (2). The agency shall determine which
94	conditions and procedures, performance outcomes, and patient
95	charge data to disclose based upon input from the council. When
96	determining which conditions and procedures are to be disclosed,
97	the council and the agency shall consider variation in costs,
98	variation in outcomes, and magnitude of variations and other
99	relevant information. When determining which performance
100	outcomes to disclose, the agency:
101	a.  Shall consider such factors as volume of cases; average
102	patient charges; average length of stay; complication rates;
103	mortality rates; and infection rates, among others, which shall
104	be adjusted for case mix and severity, if applicable.
105	b.  May consider such additional measures that are adopted
106	by the Centers for Medicare and Medicaid Studies, National
107	Quality Forum, the Joint Commission on Accreditation of
108	Healthcare Organizations, the Agency for Healthcare Research and
109	Quality, or a similar national entity that establishes standards
110	to measure the performance of health care providers, or by other
111	states.
112
113	When determining which patient charge data to disclose, the
114	agency shall consider such measures as average charge, average
115	net revenue per adjusted patient day, average cost per adjusted
116	patient day, and average cost per admission, among others.
117	2.  Make available performance measures, benefit design,
118	and premium cost data from health plans licensed pursuant to
119	chapter 627 or chapter 641. The agency shall determine which
120	performance outcome and member and subscriber cost data to
121	disclose, based upon input from the council. When determining
122	which data to disclose, the agency shall consider information
123	that may be required by either individual or group purchasers to
124	assess the value of the product, which may include membership
125	satisfaction, quality of care, current enrollment or membership,
126	coverage areas, accreditation status, premium costs, plan costs,
127	premium increases, range of benefits, copayments and
128	deductibles, accuracy and speed of claims payment, credentials
129	of physicians, number of providers, names of network providers,
130	and hospitals in the network. Health plans shall make available
131	to the agency any such data or information that is not currently
132	reported to the agency or the office.
133	3.  Determine the method and format for public disclosure
134	of data reported pursuant to this paragraph. The agency shall
135	make its determination based upon input from the Comprehensive
136	Health Information System Advisory Council. At a minimum, the
137	data shall be made available on the agency's Internet website in
138	a manner that allows consumers to conduct an interactive search
139	that allows them to view and compare the information for
140	specific providers. The website must include such additional
141	information as is determined necessary to ensure that the
142	website enhances informed decisionmaking among consumers and
143	health care purchasers, which shall include, at a minimum,
144	appropriate guidance on how to use the data and an explanation
145	of why the data may vary from provider to provider. The data
146	specified in subparagraph 1. shall be released no later than
147	January 1, 2006, for the reporting of infection rates, and no
148	later than October March 1, 2005, for mortality rates and
149	complication rates. The data specified in subparagraph 2. shall
150	be released no later than October March 1, 2006.
151	Section 2.  Paragraph (b) of subsection (3) of section
152	408.909, Florida Statutes, is amended to read:
153	408.909  Health flex plans.--
154	(3)  PROGRAM.--The agency and the office shall each approve
155	or disapprove health flex plans that provide health care
156	coverage for eligible participants. A health flex plan may limit
157	or exclude benefits otherwise required by law for insurers
158	offering coverage in this state, may cap the total amount of
159	claims paid per year per enrollee, may limit the number of
160	enrollees, or may take any combination of those actions. A
161	health flex plan offering may include the option of a
162	catastrophic plan supplementing the health flex plan.
163	(b)  The office shall develop guidelines for the review of
164	health flex plan applications and provide regulatory oversight
165	of health flex plan advertisement and marketing procedures. The
166	office shall disapprove or shall withdraw approval of plans
167	that:
168	1.  Contain any ambiguous, inconsistent, or misleading
169	provisions or any exceptions or conditions that deceptively
170	affect or limit the benefits purported to be assumed in the
171	general coverage provided by the health flex plan;
172	2.  Provide benefits that are unreasonable in relation to
173	the premium charged or contain provisions that are unfair or
174	inequitable or contrary to the public policy of this state, that
175	encourage misrepresentation, or that result in unfair
176	discrimination in sales practices; or
177	3.  Cannot demonstrate that the health flex plan is
178	financially sound and that the applicant is able to underwrite
179	or finance the health care coverage provided; or
180	4.  Cannot demonstrate that the applicant and its
181	management are in compliance with the standards required
182	pursuant to s. 624.404(3).
183	Section 3.  Subsection (6) is added to section 627.413,
184	Florida Statutes, to read:
185	627.413  Contents of policies, in general;
186	identification.--
187	(6)  Notwithstanding any other provision of the Florida
188	Insurance Code that is in conflict with federal requirements for
189	a health savings account qualified high deductible health plan,
190	an insurer, or a health maintenance organization subject to part
191	I of chapter 641, which is authorized to issue health insurance
192	in this state may offer for sale an individual or group policy
193	or contract that provides for a high deductible plan that meets
194	the federal requirements of a health savings account plan and
195	which is offered in conjunction with a health savings account.
196	Section 4.  Subsection (2) of section 627.638, Florida
197	Statutes, is amended to read:
198	627.638  Direct payment for hospital, medical services.--
199	(2)  Whenever, in any health insurance claim form, an
200	insured specifically authorizes payment of benefits directly to
201	any recognized hospital, or physician, or dentist, the insurer
202	shall make such payment to the designated provider of such
203	services, unless otherwise provided in the insurance contract.
204	The insurance contract may not prohibit, and claims forms must
205	provide option for, the payment of benefits directly to a
206	licensed hospital, physician, or dentist for care provided
207	pursuant to s. 395.1041. The insurer may require written
208	attestation of assignment of benefits. Payment to the provider
209	from the insurer shall be no more than the amount that the
210	insurer would otherwise have paid without the assignment.
211	Section 5.  Section 627.6402, Florida Statutes, is amended
212	to read:
213	627.6402  Insurance rebates for healthy lifestyles.--
214	(1)  Any rate, rating schedule, or rating manual for an
215	individual health insurance policy filed with the office may
216	shall provide for an appropriate rebate of premiums paid in the
217	last calendar year when the individual covered by such plan is
218	enrolled in and maintains participation in any health wellness,
219	maintenance, or improvement program approved by the health plan.
220	The rebate may be based on premiums paid in the last calendar
221	year or the last policy year. The individual must provide
222	evidence of demonstrative maintenance or improvement of the
223	individual's health status as determined by assessments of
224	agreed-upon health status indicators between the individual and
225	the health insurer, including, but not limited to, reduction in
226	weight, body mass index, and smoking cessation. Any rebate
227	provided by the health insurer is presumed to be appropriate
228	unless credible data demonstrates otherwise, or unless such
229	rebate program requires the insured to incur costs to qualify
230	for the rebate which equal or exceed the value of the rebate,
231	but in no event shall the rebate not exceed 10 percent of paid
232	premiums.
233	(2)  The premium rebate authorized by this section shall be
234	effective for an insured on an annual basis, unless the
235	individual fails to maintain or improve his or her health status
236	while participating in an approved wellness program, or credible
237	evidence demonstrates that the individual is not participating
238	in the approved wellness program.
239	(3)  The program shall be available for all policies issued
240	on or after July 1, 2005.
241	Section 6.  Paragraph (b) of subsection (3) of section
242	627.6487, Florida Statutes, is amended to read:
243	627.6487  Guaranteed availability of individual health
244	insurance coverage to eligible individuals.--
245	(3)  For the purposes of this section, the term "eligible
246	individual" means an individual:
247	(b)  Who is not eligible for coverage under:
248	1.  A group health plan, as defined in s. 2791 of the
249	Public Health Service Act;
250	2.  A conversion policy or contract issued by an authorized
251	insurer or health maintenance organization under s. 627.6675 or
252	s. 641.3921, respectively, offered to an individual who is no
253	longer eligible for coverage under either an insured or self-
254	insured employer plan;
255	3.  Part A or part B of Title XVIII of the Social Security
256	Act; or
257	4.  A state plan under Title XIX of such act, or any
258	successor program, and does not have other health insurance
259	coverage; or
260	5.  The Florida Health Insurance Plan as specified in s.
261	627.64872 and such plan is accepting new enrollments. However, a
262	person whose previous coverage was under the Florida Health
263	Insurance Plan as specified in s. 627.64872 is not an eligible
264	individual as defined in s. 627.6487(3)(a);
265	Section 7.  Paragraphs (b), (c), and (n) of subsection (2)
266	and subsections (3), (6), (9), and (15) of section 627.64872,
267	Florida Statutes, are amended, subsection (20) of said section
268	is renumbered as subsection (21), and a new subsection (20) is
269	added to said section, to read:
270	627.64872  Florida Health Insurance Plan.--
271	(2)  DEFINITIONS.--As used in this section:
272	(b)  "Commissioner" means the Commissioner of Insurance
273	Regulation.
274	(c)  "Dependent" means a resident spouse or resident
275	unmarried child under the age of 19 years, a child who is a
276	student under the age of 25 years and who is financially
277	dependent upon the parent, or a child of any age who is disabled
278	and dependent upon the parent.
279	(c)  "Director" means the Director of the Office of
280	Insurance Regulation.
281	(n)  "Resident" means an individual who has been legally
282	domiciled in this state for a period of at least 6 months and
283	who physically resides in this state not less than 185 days per
284	year.
285	(3)  BOARD OF DIRECTORS.--
286	(a)  The plan shall operate subject to the supervision and
287	control of the board. The board shall consist of the
288	commissioner director or his or her designated representative,
289	who shall serve as a member of the board and shall be its chair,
290	and an additional eight members, five of whom shall be appointed
291	by the Governor, at least two of whom shall be individuals not
292	representative of insurers or health care providers, one of whom
293	shall be appointed by the President of the Senate, one of whom
294	shall be appointed by the Speaker of the House of
295	Representatives, and one of whom shall be appointed by the Chief
296	Financial Officer.
297	(b)  The term to be served on the board by the commissioner
298	Director of the Office of Insurance Regulation shall be
299	determined by continued employment in such position. The
300	remaining initial board members shall serve for a period of time
301	as follows: two members appointed by the Governor and the
302	members appointed by the President of the Senate and the Speaker
303	of the House of Representatives shall serve a term of 2 years;
304	and three members appointed by the Governor and the Chief
305	Financial Officer shall serve a term of 4 years. Subsequent
306	board members shall serve for a term of 3 years. A board
307	member's term shall continue until his or her successor is
308	appointed.
309	(c)  Vacancies on the board shall be filled by the
310	appointing authority, such authority being the Governor, the
311	President of the Senate, the Speaker of the House of
312	Representatives, or the Chief Financial Officer. The appointing
313	authority may remove board members for cause.
314	(d)  The commissioner director, or his or her recognized
315	representative, shall be responsible for any organizational
316	requirements necessary for the initial meeting of the board
317	which shall take place no later than September 1, 2004.
318	(e)  Members shall not be compensated in their capacity as
319	board members but shall be reimbursed for reasonable expenses
320	incurred in the necessary performance of their duties in
321	accordance with s. 112.061.
322	(f)  The board shall submit to the Financial Services
323	Commission a plan of operation for the plan and any amendments
324	thereto necessary or suitable to ensure the fair, reasonable,
325	and equitable administration of the plan. The plan of operation
326	shall ensure that the plan qualifies to apply for any available
327	funding from the Federal Government that adds to the financial
328	viability of the plan. The plan of operation shall become
329	effective upon approval in writing by the Financial Services
330	Commission consistent with the date on which the coverage under
331	this section must be made available. If the board fails to
332	submit a suitable plan of operation within 1 year after
333	implementation the appointment of the board of directors, or at
334	any time thereafter fails to submit suitable amendments to the
335	plan of operation, the Financial Services Commission shall adopt
336	such rules as are necessary or advisable to effectuate the
337	provisions of this section. Such rules shall continue in force
338	until modified by the office or superseded by a plan of
339	operation submitted by the board and approved by the Financial
340	Services Commission.
341	(6)  INTERIM REPORT; ANNUAL REPORT.--
342	(a)  By no later than December 1, 2004, the board shall
343	report to the Governor, the President of the Senate, and the
344	Speaker of the House of Representatives the results of an
345	actuarial study conducted by the board to determine, including,
346	but not limited to:
347	1.  The impact the creation of the plan will have on the
348	small group insurance market and the individual market on
349	premiums paid by insureds. This shall include an estimate of the
350	total anticipated aggregate savings for all small employers in
351	the state.
352	2.  The number of individuals the pool could reasonably
353	cover at various funding levels, specifically, the number of
354	people the pool may cover at each of those funding levels.
355	3.  A recommendation as to the best source of funding for
356	the anticipated deficits of the pool.
357	4.  The effect on the individual and small group market by
358	including in the Florida Health Insurance Plan persons eligible
359	for coverage under s. 627.6487, as well as the cost of including
360	these individuals.
361
362	The board shall take no action to implement the Florida Health
363	Insurance Plan, other than the completion of the actuarial study
364	authorized in this paragraph, until funds are appropriated for
365	startup cost and any projected deficits.
366	(b)  No later than December 1, 2005, and annually
367	thereafter, the board shall submit to the Governor, the
368	President of the Senate, the Speaker of the House of
369	Representatives, and the substantive legislative committees of
370	the Legislature a report which includes an independent actuarial
371	study to determine, including, but not be limited to:
372	(a)1.  The impact the creation of the plan has on the small
373	group and individual insurance market, specifically on the
374	premiums paid by insureds. This shall include an estimate of the
375	total anticipated aggregate savings for all small employers in
376	the state.
377	(b)2.  The actual number of individuals covered at the
378	current funding and benefit level, the projected number of
379	individuals that may seek coverage in the forthcoming fiscal
380	year, and the projected funding needed to cover anticipated
381	increase or decrease in plan participation.
382	3.  A recommendation as to the best source of funding for
383	the anticipated deficits of the pool.
384	(c)4.  A summarization of the activities of the plan in the
385	preceding calendar year, including the net written and earned
386	premiums, plan enrollment, the expense of administration, and
387	the paid and incurred losses.
388	(d)5.  A review of the operation of the plan as to whether
389	the plan has met the intent of this section.
390	(9)  ELIGIBILITY.--
391	(a)  Any individual person who is and continues to be a
392	resident of this state shall be eligible for coverage under the
393	plan if:
394	1.  Evidence is provided that the person received notices
395	of rejection or refusal to issue substantially similar coverage
396	for health reasons from at least two health insurers or health
397	maintenance organizations. A rejection or refusal by an insurer
398	offering only stop-loss, excess of loss, or reinsurance coverage
399	with respect to the applicant shall not be sufficient evidence
400	under this paragraph;.
401	2.  The person is enrolled in the Florida Comprehensive
402	Health Association as of the date the plan is implemented; or.
403	3.  Is an eligible individual as defined in s. 627.6487(3),
404	excluding s. 627.6487(3)(b)5.
405	(b)  Each resident dependent of a person who is eligible
406	for coverage under the plan shall also be eligible for such
407	coverage.
408	(c)  Except for individuals made eligible under
409	subparagraph (a)3., a person shall not be eligible for coverage
410	under the plan if:
411	1.  The person has or obtains health insurance coverage
412	substantially similar to or more comprehensive than a plan
413	policy, or would be eligible to obtain such coverage, unless a
414	person may maintain other coverage for the period of time the
415	person is satisfying any preexisting condition waiting period
416	under a plan policy or may maintain plan coverage for the period
417	of time the person is satisfying a preexisting condition waiting
418	period under another health insurance policy intended to replace
419	the plan policy;.
420	2.  The person is determined to be eligible for health care
421	benefits under Medicaid, Medicare, the state's children's health
422	insurance program, or any other federal, state, or local
423	government program that provides health benefits;
424	3.  The person voluntarily terminated plan coverage unless
425	12 months have elapsed since such termination;
426	4.  The person is an inmate or resident of a public
427	institution; or
428	5.  The person's premiums are paid for or reimbursed under
429	any government-sponsored program or by any government agency or
430	health care provider or by any health care provider sponsored or
431	affiliated organization.
432	(d)  Coverage shall cease:
433	1.  On the date a person is no longer a resident of this
434	state;
435	2.  On the date a person requests coverage to end;
436	3.  Upon the death of the covered person;
437	4.  On the date state law requires cancellation or
438	nonrenewal of the policy; or
439	5.  At the option of the plan, 30 days after the plan makes
440	any inquiry concerning the person's eligibility or place of
441	residence to which the person does not reply; or.
442	6.  Upon failure of the insured to pay for continued
443	coverage.
444	(e)  Except under the circumstances described in this
445	subsection, coverage of a person who ceases to meet the
446	eligibility requirements of this subsection shall be terminated
447	at the end of the policy period for which the necessary premiums
448	have been paid.
449	(15)  FUNDING OF THE PLAN.--
450	(a)  Premiums.--
451	1.  The plan shall establish premium rates for plan
452	coverage as provided in this section. Separate schedules of
453	premium rates based on age, sex, and geographical location may
454	apply for individual risks. Premium rates and schedules shall be
455	submitted to the office for approval prior to use.
456	2.  Initial rates for plan coverage shall be limited to no
457	more than 200 percent 300 percent of rates established for
458	individual standard risks as specified in s. 627.6675(3)(c).
459	Subject to the limits provided in this paragraph, subsequent
460	rates shall be established to provide fully for the expected
461	costs of claims, including recovery of prior losses, expenses of
462	operation, investment income of claim reserves, and any other
463	cost factors subject to the limitations described herein, but in
464	no event shall premiums exceed the 200-percent 300-percent rate
465	limitation provided in this section. Notwithstanding the 200-
466	percent 300-percent rate limitation, sliding scale premium
467	surcharges based upon the insured's income may apply to all
468	enrollees, except those made eligible for coverage by
469	subparagraph (9)(a)3.
470	3.  For the purposes of determining assessments under this
471	section, the term "health insurance" means any hospital and
472	medical expense incurred policy, minimum premium plan, stop-loss
473	coverage, health maintenance organization contract, prepaid
474	health clinic contract, multiple-employer welfare arrangement
475	contract, or fraternal benefit society health benefits contract,
476	whether sold as an individual or group policy or contract. The
477	term does not include a policy covering medical payment coverage
478	or personal injury protection coverage in a motor vehicle
479	policy, coverage issued as a supplement to liability insurance,
480	or workers' compensation.
481	(b)  Sources of additional revenue.--Any deficit incurred
482	by the plan may shall be primarily funded through amounts
483	appropriated by the Legislature from general revenue and other
484	appropriate sources, including, but not limited to, a portion of
485	the annual growth in existing net insurance premium taxes in an
486	amount not less than the anticipated losses and reserve
487	requirements for existing policyholders. General revenue sources
488	for the plan shall not exceed $5 million per year and are
489	subject to annual appropriation by the Legislature. The board
490	shall operate the plan in such a manner that the estimated cost
491	of providing health insurance during any fiscal year will not
492	exceed total income the plan expects to receive from policy
493	premiums and funds appropriated by the Legislature, including
494	any interest on investments. After determining the amount of
495	funds appropriated to the board for a fiscal year, the board
496	shall estimate the number of new policies it believes the plan
497	has the financial capacity to insure during that year so that
498	costs do not exceed income. The board shall take steps necessary
499	to ensure that plan enrollment does not exceed the number of
500	residents it has estimated it has the financial capacity to
501	insure.
502	(c)  In the event of inadequate funding, the board may
503	cancel existing policies on a nondiscriminatory basis as
504	necessary to remedy the situation. No policy may be canceled if
505	a covered individual is currently making a claim.
506	(20)  PROVIDER REIMBURSEMENT.--Notwithstanding any other
507	provision of law, the maximum reimbursement rate to health care
508	providers for all covered, medically necessary services shall be
509	100 percent of Medicare's allowed payment amount for that
510	particular provider and service. All licensed providers in this
511	state shall accept assignment of plan benefits and consider the
512	Medicare allowed payment amount as payment in full. By no later
513	than December 1, 2005, the board shall update the actuarial
514	study required by s. 627.64872(6), to include the impact of
515	alternative methods of actuarially sound risk adjusted provider
516	reimbursement methodologies, including capitated prepaid
517	arrangements, that take into account such factors as age, sex,
518	geographic variations, case mix, and access to specialty medical
519	care. The board shall submit the updated actuarial study to the
520	Governor, the President of the Senate, and the Speaker of the
521	House no later than December 1, 2005.
522	Section 8.  Section 627.65626, Florida Statutes, is amended
523	to read:
524	627.65626  Insurance rebates for healthy lifestyles.--
525	(1)  Any rate, rating schedule, or rating manual for a
526	health insurance policy, which provides creditable coverage as
527	defined in s. 627.6561(5), filed with the office shall provide
528	for an appropriate rebate of premiums paid in the last policy
529	year, contract year, or calendar year when the majority of
530	members of a health plan have enrolled and maintained
531	participation in any health wellness, maintenance, or
532	improvement program offered by the group policyholder and the
533	health plan employer. The rebate may be based upon premiums paid
534	in the last calendar year or policy year. The group employer
535	must provide evidence of demonstrative maintenance or
536	improvement of the enrollees' health status as determined by
537	assessments of agreed-upon health status indicators between the
538	policyholder employer and the health insurer, including, but not
539	limited to, reduction in weight, body mass index, and smoking
540	cessation. The group or health insurer may contract with an
541	independent third-party administrator to assemble and report the
542	health status required in this subsection between the
543	policyholder and the health insurer. Any rebate provided by the
544	health insurer is presumed to be appropriate unless credible
545	data demonstrates otherwise or unless such rebate program
546	requires the insured to incur costs to qualify for the rebate
547	which equal or exceed the value of the rebate, but in no event
548	shall the rebate not exceed 10 percent of paid premiums.
549	(2)  The premium rebate authorized by this section shall be
550	effective for an insured on an annual basis unless the number of
551	participating employees or members on the policy renewal
552	anniversary becomes less than the majority of the employees or
553	members eligible for participation in the wellness program.
554	(3)  The program shall be available for all policies issued
555	on or after July 1, 2005.
556	Section 9.  Paragraphs (d) and (j) of subsection (5) of
557	section 627.6692, Florida Statutes, are amended to read:
558	627.6692  Florida Health Insurance Coverage Continuation
559	Act.--
560	(5)  CONTINUATION OF COVERAGE UNDER GROUP HEALTH PLANS.--
561	(d)1.  A qualified beneficiary must give written notice to
562	the insurance carrier within 63 30 days after the occurrence of
563	a qualifying event. Unless otherwise specified in the notice, a
564	notice by any qualified beneficiary constitutes notice on behalf
565	of all qualified beneficiaries. The written notice must inform
566	the insurance carrier of the occurrence and type of the
567	qualifying event giving rise to the potential election by a
568	qualified beneficiary of continuation of coverage under the
569	group health plan issued by that insurance carrier, except that
570	in cases where the covered employee has been involuntarily
571	discharged, the nature of such discharge need not be disclosed.
572	The written notice must, at a minimum, identify the employer,
573	the group health plan number, the name and address of all
574	qualified beneficiaries, and such other information required by
575	the insurance carrier under the terms of the group health plan
576	or the commission by rule, to the extent that such information
577	is known by the qualified beneficiary.
578	2.  Within 14 days after the receipt of written notice
579	under subparagraph 1., the insurance carrier shall send each
580	qualified beneficiary by certified mail an election and premium
581	notice form, approved by the office, which form must provide for
582	the qualified beneficiary's election or nonelection of
583	continuation of coverage under the group health plan and the
584	applicable premium amount due after the election to continue
585	coverage. This subparagraph does not require separate mailing of
586	notices to qualified beneficiaries residing in the same
587	household, but requires a separate mailing for each separate
588	household.
589	(j)  Notwithstanding paragraph (b), if a qualified
590	beneficiary in the military reserve or National Guard has
591	elected to continue coverage and is thereafter called to active
592	duty and the coverage under the group plan is terminated by the
593	beneficiary or the carrier due to the qualified beneficiary
594	becoming eligible for TRICARE (the health care program provided
595	by the United States Defense Department), the 18-month period or
596	such other applicable maximum time period for which the
597	qualified beneficiary would otherwise be entitled to continue
598	coverage is tolled during the time that he or she is covered
599	under the TRICARE program. Within 63 30 days after the federal
600	TRICARE coverage terminates, the qualified beneficiary may elect
601	to continue coverage under the group health plan, retroactively
602	to the date coverage terminated under TRICARE, for the remainder
603	of the 18-month period or such other applicable time period,
604	subject to termination of coverage at the earliest of the
605	conditions specified in paragraph (b).
606	Section 10.  Paragraph (c) of subsection (5) and paragraphs
607	(b) and (j) of subsection (11) of section 627.6699, Florida
608	Statutes, are amended, and paragraph (o) is added to subsection
609	(11) of said section, to read:
610	627.6699  Employee Health Care Access Act.--
611	(5)  AVAILABILITY OF COVERAGE.--
612	(c)  Every small employer carrier must, as a condition of
613	transacting business in this state:
614	1.  Offer and issue all small employer health benefit plans
615	on a guaranteed-issue basis to every eligible small employer,
616	with 2 to 50 eligible employees, that elects to be covered under
617	such plan, agrees to make the required premium payments, and
618	satisfies the other provisions of the plan. A rider for
619	additional or increased benefits may be medically underwritten
620	and may only be added to the standard health benefit plan. The
621	increased rate charged for the additional or increased benefit
622	must be rated in accordance with this section.
623	2.  In the absence of enrollment availability in the
624	Florida Health Insurance Plan, offer and issue basic and
625	standard small employer health benefit plans and a high
626	deductible plan that meets the requirements of a health savings
627	account plan or health reimbursement account as defined by
628	federal law, on a guaranteed-issue basis, during a 31-day open
629	enrollment period of August 1 through August 31 of each year, to
630	every eligible small employer, with fewer than two eligible
631	employees, which small employer is not formed primarily for the
632	purpose of buying health insurance and which elects to be
633	covered under such plan, agrees to make the required premium
634	payments, and satisfies the other provisions of the plan.
635	Coverage provided under this subparagraph shall begin on October
636	1 of the same year as the date of enrollment, unless the small
637	employer carrier and the small employer agree to a different
638	date. A rider for additional or increased benefits may be
639	medically underwritten and may only be added to the standard
640	health benefit plan. The increased rate charged for the
641	additional or increased benefit must be rated in accordance with
642	this section. For purposes of this subparagraph, a person, his
643	or her spouse, and his or her dependent children constitute a
644	single eligible employee if that person and spouse are employed
645	by the same small employer and either that person or his or her
646	spouse has a normal work week of less than 25 hours. Any right
647	to an open enrollment of health benefit coverage for groups of
648	fewer than two employees, pursuant to this section, shall remain
649	in full force and effect in the absence of the availability of
650	new enrollment into the Florida Health Insurance Plan.
651	3.  This paragraph does not limit a carrier's ability to
652	offer other health benefit plans to small employers if the
653	standard and basic health benefit plans are offered and
654	rejected.
655	(11)  SMALL EMPLOYER HEALTH REINSURANCE PROGRAM.--
656	(b)1.  The program shall operate subject to the supervision
657	and control of the board.
658	2.  Effective upon this act becoming a law, the board shall
659	consist of the director of the office or his or her designee,
660	who shall serve as the chairperson, and 13 additional members
661	who are representatives of carriers and insurance agents and are
662	appointed by the director of the office and serve as follows:
663	a.  Five members shall be representatives of health
664	insurers licensed under chapter 624 or chapter 641. Two members
665	shall be agents who are actively engaged in the sale of health
666	insurance. Four members shall be employers or representatives of
667	employers. One member shall be a person covered under an
668	individual health insurance policy issued by a licensed insurer
669	in this state. One member shall represent the Agency for Health
670	Care Administration and shall be recommended by the Secretary of
671	Health Care Administration. The director of the office shall
672	include representatives of small employer carriers subject to
673	assessment under this subsection. If two or more carriers elect
674	to be risk-assuming carriers, the membership must include at
675	least two representatives of risk-assuming carriers; if one
676	carrier is risk-assuming, one member must be a representative of
677	such carrier. At least one member must be a carrier who is
678	subject to the assessments, but is not a small employer carrier.
679	Subject to such restrictions, at least five members shall be
680	selected from individuals recommended by small employer carriers
681	pursuant to procedures provided by rule of the commission. Three
682	members shall be selected from a list of health insurance
683	carriers that issue individual health insurance policies. At
684	least two of the three members selected must be reinsuring
685	carriers. Two members shall be selected from a list of insurance
686	agents who are actively engaged in the sale of health insurance.
687	b.  A member appointed under this subparagraph shall serve
688	a term of 4 years and shall continue in office until the
689	member's successor takes office, except that, in order to
690	provide for staggered terms, the director of the office shall
691	designate two of the initial appointees under this subparagraph
692	to serve terms of 2 years and shall designate three of the
693	initial appointees under this subparagraph to serve terms of 3
694	years.
695	3.  The director of the office may remove a member for
696	cause.
697	4.  Vacancies on the board shall be filled in the same
698	manner as the original appointment for the unexpired portion of
699	the term.
700	5.  The director of the office may require an entity that
701	recommends persons for appointment to submit additional lists of
702	recommended appointees.
703	(j)1.  Before July March 1 of each calendar year, the board
704	shall determine and report to the office the program net loss
705	for the previous year, including administrative expenses for
706	that year, and the incurred losses for the year, taking into
707	account investment income and other appropriate gains and
708	losses.
709	2.  Any net loss for the year shall be recouped by
710	assessment of the carriers, as follows:
711	a.  The operating losses of the program shall be assessed
712	in the following order subject to the specified limitations. The
713	first tier of assessments shall be made against reinsuring
714	carriers in an amount which shall not exceed 5 percent of each
715	reinsuring carrier's premiums from health benefit plans covering
716	small employers. If such assessments have been collected and
717	additional moneys are needed, the board shall make a second tier
718	of assessments in an amount which shall not exceed 0.5 percent
719	of each carrier's health benefit plan premiums. Except as
720	provided in paragraph (n), risk-assuming carriers are exempt
721	from all assessments authorized pursuant to this section. The
722	amount paid by a reinsuring carrier for the first tier of
723	assessments shall be credited against any additional assessments
724	made.
725	b.  The board shall equitably assess carriers for operating
726	losses of the plan based on market share. The board shall
727	annually assess each carrier a portion of the operating losses
728	of the plan. The first tier of assessments shall be determined
729	by multiplying the operating losses by a fraction, the numerator
730	of which equals the reinsuring carrier's earned premium
731	pertaining to direct writings of small employer health benefit
732	plans in the state during the calendar year for which the
733	assessment is levied, and the denominator of which equals the
734	total of all such premiums earned by reinsuring carriers in the
735	state during that calendar year. The second tier of assessments
736	shall be based on the premiums that all carriers, except risk-
737	assuming carriers, earned on all health benefit plans written in
738	this state. The board may levy interim assessments against
739	carriers to ensure the financial ability of the plan to cover
740	claims expenses and administrative expenses paid or estimated to
741	be paid in the operation of the plan for the calendar year prior
742	to the association's anticipated receipt of annual assessments
743	for that calendar year. Any interim assessment is due and
744	payable within 30 days after receipt by a carrier of the interim
745	assessment notice. Interim assessment payments shall be credited
746	against the carrier's annual assessment. Health benefit plan
747	premiums and benefits paid by a carrier that are less than an
748	amount determined by the board to justify the cost of collection
749	may not be considered for purposes of determining assessments.
750	c.  Subject to the approval of the office, the board shall
751	make an adjustment to the assessment formula for reinsuring
752	carriers that are approved as federally qualified health
753	maintenance organizations by the Secretary of Health and Human
754	Services pursuant to 42 U.S.C. s. 300e(c)(2)(A) to the extent,
755	if any, that restrictions are placed on them that are not
756	imposed on other small employer carriers.
757	3.  Before July March 1 of each year, the board shall
758	determine and file with the office an estimate of the
759	assessments needed to fund the losses incurred by the program in
760	the previous calendar year.
761	4.  If the board determines that the assessments needed to
762	fund the losses incurred by the program in the previous calendar
763	year will exceed the amount specified in subparagraph 2., the
764	board shall evaluate the operation of the program and report its
765	findings, including any recommendations for changes to the plan
766	of operation, to the office within 180 90 days following the end
767	of the calendar year in which the losses were incurred. The
768	evaluation shall include an estimate of future assessments, the
769	administrative costs of the program, the appropriateness of the
770	premiums charged and the level of carrier retention under the
771	program, and the costs of coverage for small employers. If the
772	board fails to file a report with the office within 180 90 days
773	following the end of the applicable calendar year, the office
774	may evaluate the operations of the program and implement such
775	amendments to the plan of operation the office deems necessary
776	to reduce future losses and assessments.
777	5.  If assessments exceed the amount of the actual losses
778	and administrative expenses of the program, the excess shall be
779	held as interest and used by the board to offset future losses
780	or to reduce program premiums. As used in this paragraph, the
781	term "future losses" includes reserves for incurred but not
782	reported claims.
783	6.  Each carrier's proportion of the assessment shall be
784	determined annually by the board, based on annual statements and
785	other reports considered necessary by the board and filed by the
786	carriers with the board.
787	7.  Provision shall be made in the plan of operation for
788	the imposition of an interest penalty for late payment of an
789	assessment.
790	8.  A carrier may seek, from the office, a deferment, in
791	whole or in part, from any assessment made by the board. The
792	office may defer, in whole or in part, the assessment of a
793	carrier if, in the opinion of the office, the payment of the
794	assessment would place the carrier in a financially impaired
795	condition. If an assessment against a carrier is deferred, in
796	whole or in part, the amount by which the assessment is deferred
797	may be assessed against the other carriers in a manner
798	consistent with the basis for assessment set forth in this
799	section. The carrier receiving such deferment remains liable to
800	the program for the amount deferred and is prohibited from
801	reinsuring any individuals or groups in the program if it fails
802	to pay assessments.
803	(o)  The board shall advise the office, the agency, the
804	department, and other executive and legislative entities on
805	health insurance issues. Specifically, the board shall:
806	1.  Provide a forum for stakeholders, consisting of
807	insurers, employers, agents, consumers, and regulators, in the
808	private health insurance market in this state.
809	2.  Review and recommend strategies to improve the
810	functioning of the health insurance markets in this state with a
811	specific focus on market stability, access, and pricing.
812	3.  Make recommendations to the office for legislation
813	addressing health insurance market issues and provide comments
814	on health insurance legislation proposed by the office.
815	4.  Meet at least three times each year. One meeting shall
816	be held to hear reports and to secure public comment on the
817	health insurance market, to develop any legislation needed to
818	address health insurance market issues, and to provide comments
819	on health insurance legislation proposed by the office.
820	5.  By September 1 each year, issue a report to the office
821	on the state of the health insurance market. The report shall
822	include recommendations for changes in the health insurance
823	market, results from implementation of previous recommendations
824	and information on health insurance markets.
825	Section 11.  Subsection (1) of section 641.27, Florida
826	Statutes, is amended to read:
827	641.27  Examination by the department.--
828	(1)  The office shall examine the affairs, transactions,
829	accounts, business records, and assets of any health maintenance
830	organization as often as it deems it expedient for the
831	protection of the people of this state, but not less frequently
832	than once every 5 3 years. In lieu of making its own financial
833	examination, the office may accept an independent certified
834	public accountant's audit report prepared on a statutory
835	accounting basis consistent with this part. However, except when
836	the medical records are requested and copies furnished pursuant
837	to s. 456.057, medical records of individuals and records of
838	physicians providing service under contract to the health
839	maintenance organization shall not be subject to audit, although
840	they may be subject to subpoena by court order upon a showing of
841	good cause. For the purpose of examinations, the office may
842	administer oaths to and examine the officers and agents of a
843	health maintenance organization concerning its business and
844	affairs. The examination of each health maintenance organization
845	by the office shall be subject to the same terms and conditions
846	as apply to insurers under chapter 624. In no event shall
847	expenses of all examinations exceed a maximum of $50,000 $20,000
848	for any 1-year period. Any rehabilitation, liquidation,
849	conservation, or dissolution of a health maintenance
850	organization shall be conducted under the supervision of the
851	department, which shall have all power with respect thereto
852	granted to it under the laws governing the rehabilitation,
853	liquidation, reorganization, conservation, or dissolution of
854	life insurance companies.
855	Section 12.  Subsection (40) of section 641.31, Florida
856	Statutes, is amended to read:
857	641.31  Health maintenance contracts.--
858	(40)(a)  Any group rate, rating schedule, or rating manual
859	for a health maintenance organization policy, which provides
860	creditable coverage as defined in s. 627.6561(5), filed with the
861	office shall provide for an appropriate rebate of premiums paid
862	in the last contract calendar year when the majority of the
863	members of a health individual covered by such plan are is
864	enrolled in and maintain maintains participation in any health
865	wellness, maintenance, or improvement program offered by the
866	group contract holder approved by the health plan. The group
867	individual must provide evidence of demonstrative maintenance or
868	improvement of his or her health status as determined by
869	assessments of agreed-upon health status indicators between the
870	group individual and the health insurer, including, but not
871	limited to, reduction in weight, body mass index, and smoking
872	cessation. Any rebate provided by the health maintenance
873	organization insurer is presumed to be appropriate unless
874	credible data demonstrates otherwise or unless such rebate
875	program requires the insured to incur costs to qualify for the
876	rebate which equal or exceed the value of the rebate, but in no
877	event shall the rebate not exceed 10 percent of paid premiums.
878	(b)  The premium rebate authorized by this section shall be
879	effective for a subscriber an insured on an annual basis, unless
880	the number of participating members on the contract renewal
881	anniversary becomes less than the majority of the members
882	eligible for participation in the wellness program individual
883	fails to maintain or improve his or her health status while
884	participating in an approved wellness program, or credible
885	evidence demonstrates that the individual is not participating
886	in the approved wellness program.
887	(c)  The program shall be available for all contracts
888	issued on or after July 1, 2005.
889	Section 13.  There is hereby appropriated $5 million from
890	the General Revenue Fund for fiscal year 2005-2006 to the
891	Florida Health Insurance Plan for the purposes of implementing
892	the plan.
893	Section 14.  This act shall take effect July 1, 2005, and
894	shall apply to all policies or contracts issued or renewed on or
895	after July 1, 2005.

CODING: Words stricken are deletions; words underlined are additions.