Bill Text: IL HB0465 | 2019-2020 | 101st General Assembly | Enrolled


Bill Title: Amends the Electronic Fund Transfer Act. Makes a technical change in a Section concerning powers and duties under the Act.

Spectrum: Slight Partisan Bill (Democrat 34-17)

Status: (Enrolled) 2019-06-27 - Sent to the Governor [HB0465 Detail]

Download: Illinois-2019-HB0465-Enrolled.html



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

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

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

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

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

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

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

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

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

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

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

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

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

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

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1 (3) This Section does not authorize withholding of
2information or limit the availability of records to the public,
3except as stated in this Section or otherwise provided in this
4Act.
5(Source: P.A. 99-298, eff. 8-6-15; 99-346, eff. 1-1-16; 99-642,
6eff. 7-28-16; 100-26, eff. 8-4-17; 100-201, eff. 8-18-17;
7100-732, eff. 8-3-18.)
8 (5 ILCS 140/7.5)
9 Sec. 7.5. Statutory exemptions. To the extent provided for
10by the statutes referenced below, the following shall be exempt
11from inspection and copying:
12 (a) All information determined to be confidential
13 under Section 4002 of the Technology Advancement and
14 Development Act.
15 (b) Library circulation and order records identifying
16 library users with specific materials under the Library
17 Records Confidentiality Act.
18 (c) Applications, related documents, and medical
19 records received by the Experimental Organ Transplantation
20 Procedures Board and any and all documents or other records
21 prepared by the Experimental Organ Transplantation
22 Procedures Board or its staff relating to applications it
23 has received.
24 (d) Information and records held by the Department of
25 Public Health and its authorized representatives relating

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

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

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

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

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

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1 disclosure under subsection (a-1) of Section 45 of the Day
2 and Temporary Labor Services Act.
3 (kk) Information prohibited from disclosure under the
4 Seizure and Forfeiture Reporting Act.
5 (ll) Information the disclosure of which is restricted
6 and exempted under Section 5-30.8 of the Illinois Public
7 Aid Code.
8 (mm) (ll) Records that are exempt from disclosure under
9 Section 4.2 of the Crime Victims Compensation Act.
10 (nn) (ll) Information that is exempt from disclosure
11 under Section 70 of the Higher Education Student Assistance
12 Act.
13 (oo) Information that is exempt from disclosure under
14 subsections (f) and (j) of Section 5-36 of the Illinois
15 Public Aid Code.
16(Source: P.A. 99-78, eff. 7-20-15; 99-298, eff. 8-6-15; 99-352,
17eff. 1-1-16; 99-642, eff. 7-28-16; 99-776, eff. 8-12-16;
1899-863, eff. 8-19-16; 100-20, eff. 7-1-17; 100-22, eff. 1-1-18;
19100-201, eff. 8-18-17; 100-373, eff. 1-1-18; 100-464, eff.
208-28-17; 100-465, eff. 8-31-17; 100-512, eff. 7-1-18; 100-517,
21eff. 6-1-18; 100-646, eff. 7-27-18; 100-690, eff. 1-1-19;
22100-863, eff. 8-14-18; 100-887, eff. 8-14-18; revised
2310-12-18.)
24 Section 5. The State Employees Group Insurance Act of 1971
25is amended by changing Section 6.11 as follows:

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1 (5 ILCS 375/6.11)
2 (Text of Section after amendment by P.A. 100-1170)
3 Sec. 6.11. Required health benefits; Illinois Insurance
4Code requirements. The program of health benefits shall provide
5the post-mastectomy care benefits required to be covered by a
6policy of accident and health insurance under Section 356t of
7the Illinois Insurance Code. The program of health benefits
8shall provide the coverage required under Sections 356g,
9356g.5, 356g.5-1, 356m, 356u, 356w, 356x, 356z.2, 356z.4,
10356z.6, 356z.8, 356z.9, 356z.10, 356z.11, 356z.12, 356z.13,
11356z.14, 356z.15, 356z.17, 356z.22, 356z.25, 356z.26, 356z.29,
12and 356z.32 of the Illinois Insurance Code. The program of
13health benefits must comply with Sections 155.22a, 155.37,
14355b, 356z.19, 370c, and 370c.1, and Article XXXIIB of the
15Illinois Insurance Code. The Department of Insurance shall
16enforce the requirements of this Section with respect to
17Sections 370c and 370c.1 of the Illinois Insurance Code; all
18other requirements of this Section shall be enforced by the
19Department of Central Management Services.
20 Rulemaking authority to implement Public Act 95-1045, if
21any, is conditioned on the rules being adopted in accordance
22with all provisions of the Illinois Administrative Procedure
23Act and all rules and procedures of the Joint Committee on
24Administrative Rules; any purported rule not so adopted, for
25whatever reason, is unauthorized.

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1(Source: P.A. 99-480, eff. 9-9-15; 100-24, eff. 7-18-17;
2100-138, eff. 8-18-17; 100-863, eff. 8-14-18; 100-1024, eff.
31-1-19; 100-1057, eff. 1-1-19; 100-1102, eff. 1-1-19;
4100-1170, eff. 6-1-19.)
5 Section 10. The Illinois Insurance Code is amended by
6adding Article XXXIIB as follows:
7 (215 ILCS 5/Art. XXXIIB heading new)
8
ARTICLE XXXIIB. PHARMACY BENEFIT MANAGERS
9 (215 ILCS 5/513b1 new)
10 Sec. 513b1. Pharmacy benefit manager contracts.
11 (a) As used in this Section:
12 "Biological product" has the meaning ascribed to that term
13in Section 19.5 of the Pharmacy Practice Act.
14 "Maximum allowable cost" means the maximum amount that a
15pharmacy benefit manager will reimburse a pharmacy for the cost
16of a drug.
17 "Maximum allowable cost list" means a list of drugs for
18which a maximum allowable cost has been established by a
19pharmacy benefit manager.
20 "Pharmacy benefit manager" means a person, business, or
21entity, including a wholly or partially owned or controlled
22subsidiary of a pharmacy benefit manager, that provides claims
23processing services or other prescription drug or device

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

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

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

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

HB0465 Enrolled- 28 -LRB101 03398 JRG 48406 b
1 Sec. 513b2. Licensure requirements.
2 (a) Beginning on July 1, 2020, to conduct business in this
3State, a pharmacy benefit manager must register with the
4Director. To initially register or renew a registration, a
5pharmacy benefit manager shall submit:
6 (1) A nonrefundable fee not to exceed $500.
7 (2) A copy of the registrant's corporate charter,
8 articles of incorporation, or other charter document.
9 (3) A completed registration form adopted by the
10 Director containing:
11 (A) The name and address of the registrant.
12 (B) The name, address, and official position of
13 each officer and director of the registrant.
14 (b) The registrant shall report any change in information
15required under this Section to the Director in writing within
1660 days after the change occurs.
17 (c) Upon receipt of a completed registration form, the
18required documents, and the registration fee, the Director
19shall issue a registration certificate. The certificate may be
20in paper or electronic form, and shall clearly indicate the
21expiration date of the registration. Registration certificates
22are nontransferable.
23 (d) A registration certificate is valid for 2 years after
24its date of issue. The Director shall adopt by rule an initial
25registration fee not to exceed $500 and a registration renewal
26fee not to exceed $500, both of which shall be nonrefundable.

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

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

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

HB0465 Enrolled- 32 -LRB101 03398 JRG 48406 b
1such suspension or revocation, impose a fine upon the pharmacy
2benefit manager as provided under subsection (c).
3 (c) With respect to any knowing and willful violation of a
4lawful order of the Director, any applicable portion of this
5Code, Part of Title 50 of the Illinois Administrative Code, or
6provision of this Article, the Director may impose a fine upon
7the pharmacy benefit manager in an amount not to exceed $50,000
8for each violation.
9 (215 ILCS 5/513b5 new)
10 Sec. 513b5. Failure to register. Any pharmacy benefit
11manager that operates without a registration or fails to
12register with the Director and pay the fee prescribed by this
13Article is an unauthorized insurer as defined in Article VII of
14this Code and shall be subject to all penalties provided for
15therein.
16 (215 ILCS 5/513b6 new)
17 Sec. 513b6. Insurance Producer Administration Fund. All
18fees and fines paid to and collected by the Director under this
19Article shall be paid promptly after receipt thereof, together
20with a detailed statement of such fees, into the Insurance
21Producer Administration Fund. The moneys deposited into the
22Insurance Producer Administration Fund may be transferred to
23the Professions Indirect Cost Fund, as authorized under Section
242105-300 of the Department of Professional Regulation Law of

HB0465 Enrolled- 33 -LRB101 03398 JRG 48406 b
1the Civil Administrative Code of Illinois.
2 Section 15. The Health Maintenance Organization Act is
3amended by changing Section 5-3 as follows:
4 (215 ILCS 125/5-3) (from Ch. 111 1/2, par. 1411.2)
5 Sec. 5-3. Insurance Code provisions.
6 (a) Health Maintenance Organizations shall be subject to
7the provisions of Sections 133, 134, 136, 137, 139, 140, 141.1,
8141.2, 141.3, 143, 143c, 147, 148, 149, 151, 152, 153, 154,
9154.5, 154.6, 154.7, 154.8, 155.04, 155.22a, 355.2, 355.3,
10355b, 356g.5-1, 356m, 356v, 356w, 356x, 356y, 356z.2, 356z.4,
11356z.5, 356z.6, 356z.8, 356z.9, 356z.10, 356z.11, 356z.12,
12356z.13, 356z.14, 356z.15, 356z.17, 356z.18, 356z.19, 356z.21,
13356z.22, 356z.25, 356z.26, 356z.29, 356z.30, 356z.32, 364,
14364.01, 367.2, 367.2-5, 367i, 368a, 368b, 368c, 368d, 368e,
15370c, 370c.1, 401, 401.1, 402, 403, 403A, 408, 408.2, 409, 412,
16444, and 444.1, paragraph (c) of subsection (2) of Section 367,
17and Articles IIA, VIII 1/2, XII, XII 1/2, XIII, XIII 1/2, XXV,
18and XXVI, and XXXIIB of the Illinois Insurance Code.
19 (b) For purposes of the Illinois Insurance Code, except for
20Sections 444 and 444.1 and Articles XIII and XIII 1/2, Health
21Maintenance Organizations in the following categories are
22deemed to be "domestic companies":
23 (1) a corporation authorized under the Dental Service
24 Plan Act or the Voluntary Health Services Plans Act;

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

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

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

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

HB0465 Enrolled- 38 -LRB101 03398 JRG 48406 b
1Act and all rules and procedures of the Joint Committee on
2Administrative Rules; any purported rule not so adopted, for
3whatever reason, is unauthorized.
4(Source: P.A. 99-761, eff. 1-1-18; 100-24, eff. 7-18-17;
5100-138, eff. 8-18-17; 100-863, eff. 8-14-18; 100-1026, eff.
68-22-18; 100-1057, eff. 1-1-19; 100-1102, eff. 1-1-19; revised
710-4-18.)
8 Section 20. The Managed Care Reform and Patient Rights Act
9is amended by changing Sections 10 and 30 as follows:
10 (215 ILCS 134/10)
11 Sec. 10. Definitions.
12 "Adverse determination" means a determination by a health
13care plan under Section 45 or by a utilization review program
14under Section 85 that a health care service is not medically
15necessary.
16 "Clinical peer" means a health care professional who is in
17the same profession and the same or similar specialty as the
18health care provider who typically manages the medical
19condition, procedures, or treatment under review.
20 "Department" means the Department of Insurance.
21 "Emergency medical condition" means a medical condition
22manifesting itself by acute symptoms of sufficient severity,
23regardless of the final diagnosis given, (including, but not
24limited to, severe pain) such that a prudent layperson, who

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

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

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

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

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

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

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

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

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

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

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

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

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