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Regular Session, 2010
SENATE BILL NO. 795 (Substitute Bill for Senate Bill No. 359 by Senator Broome)
BY SENATOR BROOME
INSURANCE DEPARTMENT. Provides for network adequacy in the health insurance
market. (8/15/10)
AN ACT1
To amend and reenact R.S. 22:972 (A) and (B) and to enact R.S. 22:1016, relative to2
network adequacy in health insurance; provides for the filing of the network of3
participating health care providers; provides for definitions; requires all health4
insurance issuers to have an adequate network of providers; provides for penalties5
for violation of network adequacy rules; and to provide for related matters.6
Be it enacted by the Legislature of Louisiana:7
Section 1. R.S. 22:972(A) and (B) are hereby amended and reenacted and R.S.8
22:1016 is hereby enacted to read as follows:9
§972. Approval and disapproval of forms; filing of rates10
A. No policy of health and accident insurance shall be delivered or issued for11
delivery in this state, nor shall any endorsement, rider, or application which becomes12
a part of any such policy be used in connection therewith until a copy of the form13
and of the premium rates and of the classifications of risks pertaining thereto and the14
network of participating health care providers have been filed with the15
commissioner of insurance; nor shall any such policy, endorsement, rider, or16
application be so used until the expiration of thirty forty-five days after the form and17 SB NO. 795
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the network of participating health care providers for such forms has been filed1
unless the commissioner of insurance shall sooner give his written approval thereto.2
The commissioner of insurance shall notify in writing the insurer which has filed any3
such form or network of participating health care providers if it does not comply4
with the provisions of this Subpart, specifying the reasons for his opinion; and it5
shall thereafter be unlawful for such insurer to issue such form or use such network6
of participating providers in this state. An aggrieved party affected by the7
commissioner's decision, act, or order may demand a hearing in accordance with8
Chapter 12 of this Title, R.S. 22:2191 et seq.9
B. After twenty days' notice, the commissioner of insurance may withdraw10
his approval of any such form or network of participating providers on any of the11
grounds stated in this Section. It shall be unlawful for the insurer to issue or use such12
form or such network of participating providers or use it in connection with any13
that policy after the effective date of such withdrawal of approval. An aggrieved14
party affected by the commissioner's decision, act, or order may demand a hearing15
in accordance with Chapter 12 of this Title, R.S. 22:2191 et seq.16
* * *17
§1016. Network adequacy and accessibility; definitions; requirements; penalties18
A. The purpose and intent of this Section is to establish standards for the19
creation and maintenance of networks by health insurance issuers.20
B. For the purposes of this Section:21
(1) "Commissioner" means the insurance commissioner of this state.22
(2) "Covered health care services" or "covered benefits" or "benefits"23
means services, including ancillary services, items, supplies, or drugs for the24
diagnosis, prevention, treatment, cure, or relief of a health condition, illness,25
injury, or disease that are either covered and payable under the terms of health26
insurance coverage or required by law to be covered.27
(3) "Covered person" means a policyholder, subscriber, enrollee or28
other individual participating in a health benefit plan.29 SB NO. 795
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(4) "Health benefit plan" means a policy, contract, certificate or1
agreement entered into, offered or issued by a health insurance issuer to2
provide, deliver, arrange for, pay for or reimburse any of the costs of covered3
health care services.4
(5) "Health care physician" means a physician licensed, certified, or5
registered to perform specified health care services consistent with state law.6
(6) "Health care provider" or "provider" means a licensed health care7
physician or a hospital or the agent or assignee of such physician or hospital.8
(7) "Health insurance issuer" means an entity subject to the insurance9
laws and regulations of this state, or subject to the jurisdiction of the10
commissioner, that contracts or offers to contract, or enters into an agreement11
to provide, deliver, arrange for, pay for or reimburse any of the costs of covered12
health care services, including a sickness and accident insurance company, a13
health maintenance organization, a nonprofit hospital and health services14
corporation, or any other entity providing a plan of health insurance, health15
benefits or health services.16
(8) "Network of providers" or "network" means for each form, all the17
participating health care providers directly or indirectly contracted with a18
health insurance issuer to provide covered health care services to covered19
persons.20
(9) "Participating health care provider" means a health care provider21
who, under a contract with the health insurance issuer or with its contractor or22
subcontractor, has agreed to provide covered health care services to covered23
persons with an expectation of receiving payment, other than coinsurance,24
copayments or deductibles, directly or indirectly from the health insurance25
issuer.26
C.(1) A health insurance issuer will effectively provide or arrange for27
the provision of covered health care services through its network of28
participating health care providers. A health insurance issuer that does not29 SB NO. 795
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utilize a network of participating providers to provide covered health care1
services to its enrollees or insureds may file for an exemption to be approved by2
the commissioner.3
(2) Beginning January 31, 2011 and no later than January 31 of each4
year thereafter, a health insurance issuer shall file for approval with the5
commissioner the network of providers that supports each of the health6
insurance issuer's health benefit plans. Any network filed for approval by the7
commissioner shall contain:8
(a) A copy of the contract or the form of any contract made, or to be9
made, between the health insurance issuer and any participating provider of10
covered health care services. 11
(b) A statement describing the health insurance issuer's method of12
providing for covered health care services and describing the professional13
services to be rendered. This statement shall include the health care delivery14
capabilities of each health benefit plan including the number of primary health15
care physicians, the number of nonprimary health care physicians identified by16
specialty, and the number and type of contracted hospitals. For purposes of this17
Section, primary health care physicians may include general and family18
practitioners, internists, pediatricians, obstetricians, and gynecologists.19
(c) A statement reasonably describing the geographic service area or20
areas to be served by the health insurance issuer; this statement shall also21
include a listing of principal and other offices maintained in this state by the22
health insurance issuer.23
(3) (a) A health insurance issuer shall file a notice describing any24
material modification of any network filed for approval in accordance with this25
Section. The notice shall be filed with the commissioner as soon as possible but26
not later than thirty days following the material modification or receipt of any27
updated information by the health insurance issuer. If the commissioner does28
not disapprove the material modification or updated information within forty-29 SB NO. 795
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five days of filing, the material modification shall be deemed approved.1
(b) Material modification shall include, but not be limited to, the2
following:3
(i) Loss of a general or acute hospital from the network.4
(ii) Any case where the health insurance issuer has an insufficient5
number or type of participating providers to provide a covered health care6
service.7
(iii) Any other circumstances deemed to be an adverse material8
modification to an insured or enrollee obtaining a covered health care service.9
D.(1) Whenever an health insurance issuer is in violation of the10
provisions of this Section, the commissioner shall notify the health insurance11
issuer in writing of such violation and may:12
(a) Send notice to the health insurance issuer requesting a corrective13
action plan be submitted within thirty days; or14
(b) Issue and cause to be served an order requiring the health insurance15
issuer to cease and desist the use of such form or network of participating16
providers; or17
(c) Issue and cause to be served an order to cease any action that is in18
violation of this Section.19
(2) The commissioner may not impose a cease and desist order if the20
health insurance issuer demonstrates to the commissioner's satisfaction that the21
health insurance issuer has remedied the reason for the notice from the22
commissioner or there will be no detriment to the insured or enrollee obtaining23
covered health care services and upon a written agreement from the health24
insurance issuer ensuring that the insured or enrollee obtains covered health25
care services at no greater cost than if the covered health care services were26
obtained from participating health care providers.27
(3) The commissioner may suspend or revoke any certificate of authority28
issued to a health insurance issuer under this Section if he finds that:29 SB NO. 795
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(a) A health insurance issuer fails to comply with any provision of1
Subparagraph (1) or (2) of this Subsection.2
(b) A health insurance issuer's network impairs the ability of the health3
insurance issuer to adequately provide or arrange for covered health care4
services for its enrollees or insureds.5
(c) The health insurance issuer is operating significantly in contravention6
of the documents submitted or in a manner contrary to that described in any7
information submitted under this Section, unless the health insurance issuer8
filed with the commissioner those modifications as required by this Section.9
E. The commissioner of insurance may promulgate rules and regulations10
that he determines are necessary for implementation of this Section. Such11
implementation shall be subject to the legislative oversight of the House of12
Representatives and Senate committees on insurance in accordance with R.S.13
49:968.14
The original instrument and the following digest, which constitutes no part
of the legislative instrument, were prepared by Cheryl Horne.
DIGEST
Broome (SB 795)
Present law requires all policies of health and accident insurance to be filed with and
approved by the commissioner of insurance prior to delivery or issuance in the state.
Proposed law retains present law and also requires all health and accident insurers to file for
approval with the commissioner of insurance its network of participating health care
providers.
Present law prohibits the use of any form that has been disapproved by the commissioner
and provider for a right to a hearing to appeal any decision, act or order by the
commissioner.
Proposed law retains present law and extends these prohibitions and rights to any network
of participating health providers that is denied for use by the commissioner.
Proposed law provides for the definitions of commissioner, covered health care services,
covered benefits, benefits, covered person, health benefit plan, health care physician, health
care provider, provider, health insurance issuer, network of providers, network, and
participating health care provider.
Proposed law requires all health insurance issuers to effectively provide or arrange for the
provision of health care services through its network of participating health care services.
Proposed law requires the filing of a copy of the contract between the health insurance issuer SB NO. 795
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and any provider of health care services with the commissioner. Provides that the filing
describe the method of providing health care services and shall include the health care
delivery capabilities of each health benefit plan including a listing of all providers by
specialty and number of contracted hospitals.
Proposed law requires a statement to be issued describing the geographic service area or
areas to be served by the health insurance issuer. Requires the filing of notice of any material
modification to the network and requires the commissioner to give approval to the
modification. Requires the health insurance issuer to provide notice to the commissioner no
later than 30 days following a material modification. Defines material modification as the
loss of a general or acute hospital from the network, any case where the health insurance
issuer has an insufficient number or type of participating providers to provide a covered
health care service or any other circumstances deemed to be an adverse material
modification to an insured or enrollee obtaining a covered health care service.
Proposed law requires the commissioner to notify the health insurance issuer in writing of
a violation. Permits the commissioner to send notice to the health insurance issuer
requesting a corrective action plan be submitted within thirty days or issue a cease and desist
order regarding the use of the form or network of participating providers.
Proposed law provides that the commissioner may not impose a cease and desist order if the
health insurance issuer demonstrates to the commissioner's satisfaction that the health
insurance issuer has remedied the reason for the notice from the commissioner or there will
be no detriment to the insured or enrollee obtaining covered health care services and upon
a written agreement from the health insurance issuer ensuring that the insured or enrollee
obtains covered health care services at no greater cost than if the covered health care services
were obtained from participating health care providers.
Proposed law allows the commissioner to suspend or revoke the certificate of authority of
the health insurance issuer if the network impairs the ability of the health insurance issuer
to adequately provide or arrange for covered health care services to its enrollees or insureds
or if the health insurance issuer is operating significantly in contravention of the documents
submitted to the commissioner.
Proposed law permits the commissioner to promulgate rules and regulations in accordance
with the Administrative Procedure Act.
Effective August 15, 2010.
(Amends R.S. 22:972(A) and (B); adds R.S. 22:1016)