2020 Regular Session ENROLLED
SENATE BILL NO. 231
BY SENATOR TALBOT
1 AN ACT
2 To enact R.S. 22:1203(E), 1205(C)(8) and (9), 1209, 1210, 1215.1(4), 1216, and 1217, and
3 to repeal R.S. 22:1205(7), relative to the Louisiana Health Plan; to provide relative
4 to coverage for preexisting conditions; to provide for assessment of service charges;
5 to provide for fees; to provide for policy provisions and penalties; to provide relative
6 to health insurance rejections; and to provide for related matters.
7 Be it enacted by the Legislature of Louisiana:
8 Section 1. R.S. 22:1203(E), 1205(C)(8) and (9), 1209, 1210, 1215.1(4), 1216, and
9 1217 are hereby enacted to read as follows:
10 §1203. Creation of the plan
11 * * *
12 E.(1) Upon a finding that federal and state law no longer prohibits
13 carriers in the individual market from rejecting applicants for health insurance
14 coverage based on the presence of preexisting health conditions or excluding
15 health care coverage for preexisting conditions, the commissioner may submit
16 written notification to the Joint Legislative Committee on the Budget and the
17 House and Senate committees on insurance of his intention to reactivate the
18 Louisiana Health Plan. The notice shall include the commissioner's reasoning
19 for finding reactivation necessary and the proposed date for the plan to restart
20 operations.
21 (2) Unless one of the committees notified by the commissioner convenes
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1 and votes to reject the commissioner's proposal to reactivate the Louisiana
2 Health Plan no later than thirty days after the written notice is received, the
3 board provided for in R.S. 22:1205 shall reconvene and submit a new plan of
4 operation to the commissioner for approval within ninety days of the date the
5 written notice was submitted.
6 * * *
7 §1205. Plan of operation
8 * * *
9 C. In its plan of operation the board shall:
10 * * *
11 (8) The cessation plan approved and in effect on January 1, 2020, shall
12 continue in effect until and unless the commissioner notifies the board in writing
13 of his intent to exercise his authority under this Paragraph to reestablish the
14 Louisiana Health Plan.
15 (9) Upon approval of the plan of operation provided for in R.S.
16 22:1203(E)(2), the board shall resume operations as provided for in that plan.
17 * * *
18 §1209. Service charges
19 A.(1) Each patient who is not a private-pay patient, is not covered by
20 Medicare or any other public program, is not covered by the Office of Group
21 Benefits program, and is not covered by an insolvent insurer who is admitted
22 to a hospital for treatment, other than psychiatric care or alcohol or substance
23 abuse, shall be assessed a service charge in the amount provided in Subsection
24 G of this Section for each day or portion thereof during which the patient is
25 confined in that facility.
26 (2) Each hospital in which a patient is confined shall calculate the total
27 service charge due for that patient's period of confinement and shall include the
28 total service charge in the bill for services rendered to the patient. The
29 individual patient may be obligated to pay the service charge assessed in the
30 event that an insurance arrangement pays for any medical charges or benefits
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1 but fails to pay the service charge assessed pursuant to this Section. The service
2 charge shall be collected as provided for in the plan of operation of the plan
3 established pursuant to R.S. 22:1205.
4 (3) For purposes of this Section, "hospital" shall not include any hospital
5 operated by the state or any hospital created or operated by the Department of
6 Veterans Affairs or other agency of the United States of America or any facility
7 operated solely to provide psychiatric care or treatment of alcohol or substance
8 abuse or both.
9 B. Each patient who is not a private-pay patient, is not covered by
10 Medicare or any other public program directly subsidized by the federal
11 government, is not covered by the Office of Group Benefits program, and is not
12 covered by an insolvent insurer who is admitted to an ambulatory surgical
13 center or to a hospital for outpatient ambulatory surgical care shall be assessed
14 a service charge of one dollar for each admission to that facility. The service
15 charge shall be included in the bill for services or supplies or both rendered to
16 the patient by the ambulatory surgical center or hospital.
17 C.(1) Each hospital and ambulatory surgical center shall bill for and
18 collect the service charges assessed pursuant to this Section from monies
19 remitted to it in payment thereof in accordance with R.S. 22:1216, if authorized
20 by the plan of operation under R.S. 22:1205. In the event that no payment is
21 made by or on behalf of the patient for services rendered, the health care
22 provider shall be liable for the remittance of only those fees collected. Each
23 hospital and ambulatory surgical center shall remit to the plan for each
24 reporting period, as established in the plan of operation, the total amount of
25 service charges collected during that reporting period in accordance with the
26 reporting and remittance procedures established by the plan pursuant to R.S.
27 22:1205.
28 (2) Unless permitted by the board, the intentional failure to bill, pay,
29 report, or delineate service charges in accordance with this Section shall cause
30 the hospital or ambulatory surgical center to be liable to the plan for a fine in
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1 an amount determined by the board, not to exceed five hundred dollars plus
2 interest per failure. Any hospital or ambulatory surgical center found to have
3 intentionally failed to bill, pay, report, or delineate service charges in
4 accordance with this Section, unless permitted by the board, on three or more
5 occasions during a six-month period shall be liable for a fine in an amount
6 determined by the board, not to exceed one thousand five hundred dollars per
7 failure, together with attorney fees and court costs.
8 (3) The plan or the commissioner or both are specifically authorized to
9 conduct audits of hospitals and ambulatory surgical centers in order to enforce
10 compliance with this Section. Fines levied pursuant to this Section shall be
11 consistent with those levied against insurers pursuant to this Subpart.
12 D. The service charges imposed on hospital and ambulatory surgical
13 center patients by this Section shall be payable by the patient's insurer or
14 insurance arrangement, if any, as applicable, except the charges shall not be
15 payable by an insolvent insurer. In no event shall a hospital or ambulatory
16 surgical center be required to remit to the plan uncollected service charges for
17 any patient who is a private-pay patient or for any patient whose insurer or
18 insurance arrangement is not legally required to pay the service charges.
19 E. If monies in the plan at the end of any fiscal year exceed actual losses
20 and administrative expenses of the plan, the excess shall be held at interest and
21 used by the board to offset future losses. As used in this Subsection, "future
22 losses" includes reserves for incurred but not reported claims.
23 F. For the purposes of this Section, "insurance", "insurance
24 arrangement", or "policy of an insurer" includes any policy or plan of
25 insurance or of self-insurance that provides payment, indemnity, or
26 reimbursement for charges resulting from accident, injury, or illness when an
27 employer or insurer is responsible for those charges. The terms "insurance",
28 "insurance arrangement", or "policy of an insurer" shall not include
29 short-term, accident-only, fixed indemnity, credit insurance, automobile and
30 homeowner's medical payment coverage, or coverage issued as a supplement to
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1 liability insurance.
2 G. The service charge required by this Section shall be an amount set by
3 the commissioner upon approval of the plan provided for in R.S. 22:1203(E)(2)
4 and annually thereafter. The commissioner shall establish the amount of the
5 service charge by rule promulgated in accordance with the Administrative
6 Procedure Act no later than August thirty-first of the calendar year preceding
7 the implementation of the service charge. The charge shall apply only to dates
8 of service falling in the calendar year following promulgation of the rule. In
9 establishing the service charge, the commissioner shall determine the amount
10 necessary to fund the plan provided for in R.S. 22:1203(E)(2) but shall not
11 establish a service charge in excess of three dollars plus an inflation factor of
12 four percent per annum.
13 H. This Section shall not be effective until approval of the plan provided
14 for in R.S. 22:1203(E)(2).
15 §1210. Fees assessed to participating health insurers for plan losses attributable
16 to federally defined eligible individuals
17 A.(1) For the purposes of this Section, "participating insurer" includes
18 any insurer providing insurance, as defined by R.S. 22:1209(F), to citizens of
19 this state.
20 (2)(a) For the purposes of this Section, fees assessed to participating
21 insurers shall apply to gross premiums for hospital and medical expense
22 incurred policies, nonprofit service plan corporation contracts, hospital-only
23 coverage, medical and surgical expense policies, major medical insurance,
24 coverages provided by health maintenance organizations, individual practices,
25 associations, and every insurance appertaining to any portion of medical
26 expense liability incurred under a group health plan as defined in R.S.
27 22:1061(1)(a), including stop-loss and excess-loss coverage unless the gross
28 premium for the coverage is included under any other type of coverage stated
29 in this Section that is issued for delivery in this state.
30 (b) The fees assessed to participating insurers shall also apply to the
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1 same or similar services as provided for in Subparagraph (a) of this Paragraph
2 when the services are administered by a third-party administrator on behalf of
3 a plan that is not fully insured by a health insurance issuer, health maintenance
4 organization, or group self-insurer. For the purposes of third-party
5 administrators, "major medical insurance" shall not include the provision of
6 pharmacy benefits by a third-party administrator or by a health insurance
7 issuer or health maintenance organization when the pharmacy benefits
8 provisions do not include comprehensive coverage.
9 (c) Fee assessments to participating insurers shall not apply to policies
10 or contracts for provision of short-term, accident-only, hospital indemnity,
11 credit insurance, automobile and homeowner's medical-payment coverage,
12 workers' compensation medical benefit coverage, Medicare, Medicaid, federal
13 governmental benefit plans, supplemental health insurance, limited benefit
14 health insurance, or coverage issued as a supplement to liability.
15 B. In addition to the powers enumerated in R.S. 22:1206, the plan shall
16 have the authority to assess fees to participating insurers in accordance with the
17 provisions of this Section and to make advance interim fee assessments as may
18 be reasonable and necessary for the plan's organizational and interim operating
19 expenses. Any interim fees assessed are to be credited as offsets against any
20 regular fees assessed that become payable following the close of the fiscal year.
21 C. Following the close of each fiscal year, the administrator shall
22 determine the net premiums, premiums less reasonable administrative expense
23 allowances, the plan expenses of administration, and the incurred losses for the
24 year which are attributable to federally defined eligible individuals. The
25 administrator shall take into account investment income and other appropriate
26 gains and losses reasonably attributable to federally defined eligible individuals.
27 Any deficit incurred by the plan shall be identified and recouped as follows:
28 (1) The board shall identify the source of any deficit related to the
29 provision of coverage to federally defined eligible individuals before assessing
30 any fees authorized under this Section.
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1 (2) The board shall verify the adequacy of any governmental
2 appropriations or alternative funding sources, other than fees assessed under
3 this Section, used to reduce rates for the plan year. Where such funds were not
4 sufficient to support the rate reduction provided, that portion of the deficit
5 reasonably related to the funding shortfalls shall be recouped from any
6 subsequent governmental appropriations or alternative funding sources, other
7 than fees assessed under this Section, prior to making any rate reduction for a
8 subsequent plan year. The board shall take reasonable action to prevent future
9 deficits related to reducing rates based on receipt of government appropriations
10 or alternate funding sources.
11 (3) The board shall verify the amount of any deficit reasonably resulting
12 from plan losses not attributable to governmental or alternative funding
13 shortfalls used to reduce rates. Any verified deficit amount attributed to
14 federally defined eligible individuals shall be recouped by fees assessed pursuant
15 to this Section to participating insurers.
16 (4) The board shall provide the commissioner of insurance with a
17 detailed report on any deficit being recouped by fee assessments apportioned
18 pursuant to this Section. The report shall include information on services and
19 utilization patterns which can reasonably be attributed to the deficit as well as
20 analysis and recommendations on cost containment measures which can be
21 taken to minimize future deficits.
22 (5) The board shall provide the commissioner of insurance with a
23 detailed report on the sources and use of government appropriations and
24 alternate sources of funding used to make rates more affordable. The report
25 shall include information on the activities of similar plans maintained by other
26 states and recommendations for actions that can be taken to make coverage
27 more affordable for plan members.
28 D.(1) Each participating insurer's fee assessment shall be in proportion
29 to gross premiums earned on business in this state for policies or contracts
30 covered under this Section for the most recent calendar year for which
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1 information is available.
2 (2) Each participating insurer's fee assessment shall be determined by
3 the board based on annual statements and other reports deemed to be necessary
4 by the board and filed by the participating insurer with the board. The board
5 may use any reasonable method of estimating the amount of gross premium of
6 a participating insurer if the specific amount is unknown. The plan of operation
7 shall provide the details of the calculation of each participating insurer's
8 assessment which shall require the approval of the commissioner.
9 E. A participating insurer may petition the commissioner of insurance
10 for deferral of all or part of any fee assessed by the board. If, in the opinion of
11 the commissioner, payment of the fee assessment would endanger the solvency
12 of the participating insurer, the commissioner may defer, in whole or in part,
13 the fee assessment as part of a voluntary rehabilitation or supervisory plan
14 established to prevent the plan's insolvency. The duration of any deferral
15 approved under a voluntary rehabilitation or supervisory plan shall be limited
16 to four years. The voluntary rehabilitation or supervisory plan shall require
17 repayment of all deferrals by the end of the period plus legal interest. Until
18 notice of payment in full is received from the board, the insurer shall remain
19 under the voluntary rehabilitation or supervisory plan. In the event a fee
20 assessment against a participating insurer is deferred in whole or in part, the
21 amount by which the fee assessment is deferred may be assessed to the other
22 participating insurers in a manner consistent with the basis for fee assessments
23 set forth in this Section. Collection of deferrals and legal interest shall be used
24 to offset fee assessments against the other participating insurers in a manner
25 consistent with the basis for fee assessments set forth in this Section.
26 F. This Section shall not be effective until approval of the plan provided
27 for in R.S. 22:1203(E)(2).
28 * * *
29 §1215.1. Peremption
30 Dissolution of the operations of the Louisiana Health Plan requires the
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1 expeditious determination of its outstanding liabilities. As such, each of the
2 following provisions shall apply:
3 * * *
4 (4) The provisions of this Section shall not apply to any action against
5 the plan, the board, the employees of the plan, or any combination thereof
6 arising out of any obligation, duty, breach, or other activity occurring
7 subsequent to plan activity pursuant to R.S. 22:1205(C)(8).
8 §1216. Health and accident policy provisions; service charges; penalties
9 A. Any health and accident insurance policy issued under this Subpart
10 or Subpart J of Part III of Chapter 4 of this Title, and any health and accident
11 insurance policy having effect in this state, shall provide coverage without
12 regard to the insured's obligation of deductibles or copayments for the service
13 charges assessed pursuant to R.S. 22:1209. The service charges assessed to a
14 patient pursuant to R.S. 22:1209 shall be mandated benefits of any health and
15 accident insurance coverage issued by any insurer or insurance arrangement,
16 except an insolvent insurer, over and above any insurance policy limits,
17 negotiated per diem, or managed care arrangement.
18 B. Each service charge for each patient admission specified in R.S.
19 22:1209 shall be paid by the insurer or insurance arrangement in accordance
20 with the plan of operation adopted pursuant to R.S. 22:1205. Failure to pay a
21 service charge for each patient pursuant to this Section shall cause the insurer
22 or insurance arrangement to be liable to the Louisiana Health Plan, the
23 commissioner of insurance, or both for a fine in an amount determined by the
24 board, not to exceed five hundred dollars plus interest. Any insurer or
25 insurance arrangement found to have failed to comply with this Section by
26 paying each service charge for each patient admission specified in R.S. 22:1209
27 on three or more occasions during a six-month period shall be liable for a fine
28 in an amount determined by the board, of not less than five hundred dollars and
29 not more than one thousand five hundred dollars per failure to pay each service
30 charge for each patient admission, together with attorney fees, interest, and
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1 court costs. The Louisiana Health Plan, the commissioner, or both are
2 specifically authorized to conduct audits of insurers or insurance arrangements
3 in order to enforce compliance with this Section.
4 C. For the purposes of this Section, "insurance" or "insurance
5 arrangement" also includes any policy or plan of insurance or of self-insurance
6 that provides payment, indemnity, or reimbursement for charges resulting from
7 accident, injury, or illness when an employer, insurer, or tortfeasor is
8 responsible for those charges.
9 D. For purposes of this Section, "insurance" or "insurance
10 arrangement" shall not include the Office of Group Benefits program.
11 E. This Section shall not be effective until approval of the plan provided
12 for in R.S. 22:1203(E)(2).
13 §1217. Health insurance rejections; Louisiana Health Insurance Plan
14 information
15 A. Each rejection for individual health and accident insurance shall
16 contain information stating that health insurance may be available through the
17 Louisiana Health Insurance Plan. Each rejection shall also include the address
18 and telephone number at which information on the Louisiana Health Insurance
19 Plan may be obtained. In no event shall the information required by this Section
20 appear on the rejection in a smaller print than any other required provision of
21 the rejection. The requirements of this Section may be satisfied by providing a
22 document separate from the rejection containing the required information in
23 the required print size. In no event shall this information guarantee placement
24 in the fund of the Louisiana Health Insurance Plan.
25 B. This Section shall not be effective until approval of the plan provided
26 for in R.S. 22:1203(E)(2).
27 Section 2. R.S. 22:1205(7) is hereby repealed.
28 Section 3. The commissioner shall inform the Louisiana State Law Institute of the
29 date of the approval of the new plan of operation of the Louisiana Health Plan pursuant to
30 the provisions of this Act.
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1 Section 4. This Act shall become effective upon signature by the governor or, if not
2 signed by the governor, upon expiration of the time for bills to become law without signature
3 by the governor, as provided by Article III, Section 18 of the Constitution of Louisiana. If
4 vetoed by the governor and subsequently approved by the legislature, this Act shall become
5 effective on the day following such approval.
PRESIDENT OF THE SENATE
SPEAKER OF THE HOUSE OF REPRESENTATIVES
GOVERNOR OF THE STATE OF LOUISIANA
APPROVED:
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