COMMITTEE SUBSTITUTE
FOR
H. B. 2712
(By Delegates H. White, Hrutkay and R. Thompson)
(Originating in the Committee on Finance)
[February
19, 2003]
A BILL to repeal section three-c, article sixteen, chapter
thirty-three of the code of West Virginia, one thousand nine
hundred thirty-one, as amended; to amend and reenact section
three-a of said article; and to amend and reenact section
twenty-four, article twenty-five-a of said chapter, all
relating to the inclusion of mental health parity
applicability to nonemployer groups; and to the applicability
of mental health parity to health maintenance organizations.
Be it enacted by the Legislature of West Virginia:
That section three-c, article sixteen, chapter thirty-three of
the code of West Virginia, one thousand nine hundred thirty-one, as
amended, be repealed; that section three-a of said article be
amended and reenacted; and that section twenty-four, article
twenty-five-a of said chapter be amended and reenacted, all to read
as follows:
ARTICLE 16. GROUP ACCIDENT AND SICKNESS INSURANCE.
§33-16-3a. Same -- Mental health.
(a) (1) Notwithstanding the requirements of subsection (b) of
this section, any health benefits plan described in this article
that is delivered, issued or renewed in this state
to an eligible
group as provided in this article or a nonemployer group, shall
provide benefits to all individual subscribers and members and to
all group members for expenses arising from treatment of serious
mental illness. The expenses do not include custodial care,
residential care or schooling. For purposes of this section,
"serious mental illness" means an illness included in the American
psychiatric association's diagnostic and statistical manual of
mental disorders, as periodically revised, under the diagnostic
categories or subclassifications of: (i) Schizophrenia and other
psychotic disorders; (ii) bipolar disorders; (iii) depressive
disorders; (iv) substance-related disorders with the exception of
caffeine-related disorders and nicotine-related disorders; (v)
anxiety disorders; and (vi) anorexia and bulimia.
(2) Notwithstanding any other provision in this section to the
contrary, in the event that an insurer can demonstrate actuarially
to the insurance commissioner that its total anticipated costs for
treatment for mental illness, for any plan will exceed or have
exceeded two percent of the total costs for such plan in any
experience period, then the insurer may apply whatever cost
containment measurers may be necessary, including, but not limited
to, limitations on inpatient and outpatient benefits, to maintain
costs below two percent of the total costs for the plan:
Provided,
however, That for any group with twenty-five members or less, the
insurer may apply such additional cost containment measures as may
be necessary if the total anticipated actual costs for the
treatment of mental illness will exceed one percent of the total
costs for the group.
(3) The insurer shall not discriminate between
medical-surgical benefits and mental health benefits in the
administration of its plan. With regard to both medical-surgical
and mental health benefits, it may make determinations of medical
necessity and appropriateness, and it may use recognized health
care quality and cost management tools, including, but not limited
to, utilization review, use of provider networks, implementation of
cost containment measures, preauthorization for certain treatments,
setting coverage levels including the number of visits in a given
time period, using capitated benefit arrangements, using
fee-for-service arrangements, using third-party administrators, and
using patient cost sharing in the form of copayments, deductibles
and coinsurance.
(4) The provisions of this subsection shall apply with respect
to group health plans for plan years beginning on or after the
first day of January, two thousand three. The provisions of this
section shall cease to be effective on and after the thirty-first
day of March, two thousand seven, unless further extended by the
Legislature.
(5) The commissioner on or before the thirty-first day of
December, two thousand five, and annually thereafter, shall report to the Legislature's joint committee on government and finance and
the committees on insurance of the respective houses of the
Legislature regarding the fiscal impact of this subsection on the
expenses of insurers affected thereby, and which insurers expenses
of providing mental health benefits have exceeded the percentage
limits established by this subsection.
(b) With respect to mental health benefits furnished to an
enrollee of a health benefit plan offered in connection with a
group health plan, for a plan year beginning on or after the first
day of January, one thousand nine hundred ninety-eight, the
following requirements shall apply to aggregate lifetime limits and
annual limits.
(1) Aggregate lifetime limits:
(A) If the health benefit plan does not include an aggregate
lifetime limit on substantially all medical and surgical benefits,
as defined under the terms of the plan but not including mental
health benefits, the plan may not impose any aggregate lifetime
limit on mental health benefits;
(B) If the health benefit plan limits the total amount that
may be paid with respect to an individual or other coverage unit
for substantially all medical and surgical benefits (in this
paragraph, "applicable lifetime limit"), the plan shall either
apply the applicable lifetime limit to medical and surgical
benefits to which it would otherwise apply and to mental health
benefits, as defined under the terms of the plan, and not
distinguish in the application of the limit between medical and surgical benefits and mental health benefits, or not include any
aggregate lifetime limit on mental health benefits that is less
than the applicable lifetime limit;
(C) If a health benefit plan not previously described in this
subdivision includes no or different aggregate lifetime limits on
different categories of medical and surgical benefits, the
commissioner shall propose rules for legislative approval in
accordance with the provisions of article three, chapter
twenty-nine-a of this code under which paragraph (B) of this
subdivision shall apply, substituting an average aggregate lifetime
limit for the applicable lifetime limit.
(2) Annual limits:
(A) If a health benefit plan does not include an annual limit
on substantially all medical and surgical benefits, as defined
under the terms of the plan but not including mental health
benefits, the plan may not impose any annual limit on mental health
benefits, as defined under the terms of the plan;
(B) If the health benefit plan limits the total amount that
may be paid in a twelve-month period with respect to an individual
or other coverage unit for substantially all medical and surgical
benefits (in this paragraph, "applicable annual limit"), the plan
shall either apply the applicable annual limit to medical and
surgical benefits to which it would otherwise apply and to mental
health benefits, as defined under the terms of the plan, and not
distinguish in the application of the limit between medical and
surgical benefits and mental health benefits, or not include any annual limit on mental health benefits that is less than the
applicable annual limit;
(C) If a health benefit plan not previously described in this
subdivision includes no or different annual limits on different
categories of medical and surgical benefits, the commissioner shall
propose rules for legislative approval in accordance with the
provisions of article three, chapter twenty-nine-a of this code
under which paragraph (B) of this subdivision shall apply,
substituting an average annual limit for the applicable annual
limit.
(3) If a group health plan or a health insurer offers a
participant or beneficiary two or more benefit package options,
this subsection shall apply separately with respect to coverage
under each option.
ARTICLE 25A. HEALTH MAINTENANCE ORGANIZATION ACT.
§33-25A-24. Scope of provisions; applicability of other laws.
(a) Except as otherwise provided in this article, provisions
of the insurance laws and provisions of hospital or medical service
corporation laws are not applicable to any health maintenance
organization granted a certificate of authority under this article.
The provisions of this article shall not apply to an insurer or
hospital or medical service corporation licensed and regulated
pursuant to the insurance laws or the hospital or medical service
corporation laws of this state except with respect to its health
maintenance corporation activities authorized and regulated
pursuant to this article. The provisions of this article may not apply to an entity properly licensed by a reciprocal state to
provide health care services to employer groups, where residents of
West Virginia are members of an employer group, and the employer
group contract is entered into in the reciprocal state. For
purposes of this subsection, a "reciprocal state" means a state
which physically borders West Virginia and which has subscriber or
enrollee hold harmless requirements substantially similar to those
set out in section seven-a of this article.
(b) Factually accurate advertising or solicitation regarding
the range of services provided, the premiums and copayments
charged, the sites of services and hours of operation and any other
quantifiable, nonprofessional aspects of its operation by a health
maintenance organization granted a certificate of authority, or its
representative may not be construed to violate any provision of law
relating to solicitation or advertising by health professions:
Provided, That nothing contained in this subsection shall be
construed as authorizing any solicitation or advertising which
identifies or refers to any individual provider or makes any
qualitative judgment concerning any provider.
(c) Any health maintenance organization authorized under this
article may not be considered to be practicing medicine and is
exempt from the provisions of chapter thirty of this code, relating
to the practice of medicine.
(d) The provisions of sections
twelve, fifteen and twenty,
article four (general provisions); section seventeen, article six
(noncomplying forms); section twenty, article five (borrowing by insurers); article six-c (guaranteed loss ratio); article seven
(assets and liabilities); article eight (investments); article
eight-a (use of clearing corporations and federal reserve
book-entry system); article nine (administration of deposits);
article twelve (
agents, brokers, insurance producers and solicitors
and excess line);
article twelve-c (excess lines); section
fourteen, article fifteen (individual accident and sickness
insurance); section sixteen, article fifteen (coverage of
children); section eighteen, article fifteen (equal treatment of
state agency); section nineteen, article fifteen (coordination of
benefits with medicaid); article fifteen-b (uniform health care
administration act); section three, article sixteen (required
policy provisions);
section three-a, article sixteen (same-mental
health); section three-f, article sixteen (treatment of
temporomandibular disorder and craniomandibular disorder); section
eleven, article sixteen (coverage of children); section thirteen,
article sixteen (equal treatment of state agency); section
fourteen, article sixteen (coordination of benefits with medicaid);
article sixteen-a (group health insurance conversion); article
sixteen-d (marketing and rate practices for small employers);
article twenty-five-c (health maintenance organization patient bill
of rights); article twenty-seven (insurance holding company
systems); article thirty-four-a (standards and commissioner's
authority for companies considered to be in hazardous financial
condition); article thirty-five (criminal sanctions for failure to
report impairment); article thirty-seven (managing general agents); article thirty-nine (disclosure of material transactions); article
forty-one (privileges and immunity); and article forty-two (women's
access to health care) shall be applicable to any health
maintenance organization granted a certificate of authority under
this article. In circumstances where the code provisions made
applicable to health maintenance organizations by this section
refer to the "insurer", the "corporation" or words of similar
import, the language shall be construed to include health
maintenance organizations.
(e) Any long-term care insurance policy delivered or issued
for delivery in this state by a health maintenance organization
shall comply with the provisions of article fifteen-a of this
chapter.
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