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Third Substitute H.B. 144

Senator Wayne L. Niederhauser proposes the following substitute bill:


             1     
HEALTH SYSTEM REFORM AMENDMENTS

             2     
2012 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Chief Sponsor: James A. Dunnigan

             5     
Senate Sponsor: Wayne L. Niederhauser

             6     
             7      LONG TITLE
             8      General Description:
             9          This bill amends provisions in the Health Code and Insurance Code related to the state's
             10      strategic plan for health system reform.
             11      Highlighted Provisions:
             12          This bill:
             13          .    clarifies the role of the All Payer Claims Database and the Utah Health Exchange
             14      related to prospective and retrospective risk adjusting;
             15          .    makes technical amendments to the Health Department's reports that compare
             16      quality measures;
             17          .    amends provisions related to simplified Medicaid enrollment;
             18          .    authorizes an actuarial analysis of providing coverage options to individuals from
             19      133% to 200% of the federal poverty level through a basic health plan beginning in
             20      2014;
             21          .    amends provisions related to the benchmark plan for the dental program in the
             22      Children's Health Insurance Program;
             23          .    prohibits an insurer from denying coverage for a covered service based on a
             24      diagnosis of autism unless the claim is directly related to autism;
             25          .    allows dental and vision policies on the health insurance exchange if the insurance


             26      department adopts rules in consultation with the Health Reform Task Force which permit
             27      vision and dental plans on the exchange;
             28          .    amends health insurance producer disclosure requirements;
             29          .    allows an insurer to provide a premium discount to an employer group or an
             30      employee based on participation in a wellness program in the large and small group
             31      market;
             32          .    establishes the Legislature as the entity to determine the benchmark for an essential
             33      health benefit plan for the state;
             34          .    clarifies the fees that may be charged for the use of the call center for the Utah
             35      Health Exchange;
             36          .    re-authorizes the Health System Reform Task Force;
             37          .    repeals provisions that require the state to implement multipayer demonstration
             38      projects; and
             39          .    makes technical amendments.
             40      Money Appropriated in this Bill:
             41          This bill appropriates in fiscal year 2011-12:
             42          .    To the Senate, as a one-time appropriation:
             43              .    from the General Fund $15,000 to pay for the Health System Reform Task
             44      Force; and
             45          .    To the House of Representatives, as a one-time appropriation:
             46              .    from the General Fund $25,000 to pay for the Health System Reform Task
             47      Force.
             48      Other Special Clauses:
             49          This bill provides a repeal date.
             50      Utah Code Sections Affected:
             51      AMENDS:
             52          26-18-2.5, as enacted by Laws of Utah 2011, Chapter 344
             53          26-33a-106.1, as last amended by Laws of Utah 2010, Chapter 68
             54          26-33a-106.5, as last amended by Laws of Utah 2011, Chapters 297 and 400
             55          26-40-106, as last amended by Laws of Utah 2011, Chapter 400
             56          31A-22-613, as last amended by Laws of Utah 2005, Chapter 78


             57          31A-22-613.5, as last amended by Laws of Utah 2011, Chapters 297 and 400
             58          31A-22-635, as last amended by Laws of Utah 2011, Chapter 400
             59          31A-23a-402.5, as enacted by Laws of Utah 2011, Chapter 62
             60          31A-23a-501, as last amended by Laws of Utah 2011, Chapters 284 and 297
             61          31A-30-106.1, as last amended by Laws of Utah 2011, Second Special Session, Chapter
             62      5
             63          63I-2-231, as last amended by Laws of Utah 2011, Chapter 284
             64          63M-1-2504, as last amended by Laws of Utah 2011, Chapter 400
             65      ENACTS:
             66          26-18-3.8, Utah Code Annotated 1953
             67          31A-30-116, Utah Code Annotated 1953
             68      REPEALS:
             69          26-1-39, as enacted by Laws of Utah 2011, Chapter 400
             70          31A-22-614.6, as last amended by Laws of Utah 2011, Chapter 400
             71      Uncodified Material Affected:
             72      ENACTS UNCODIFIED MATERIAL
             73     
             74      Be it enacted by the Legislature of the state of Utah:
             75          Section 1. Section 26-18-2.5 is amended to read:
             76           26-18-2.5. Simplified enrollment and renewal process for Medicaid and other
             77      state medical programs -- Financial institutions.
             78          (1) The department [shall] may:
             79          (a) apply for grants and accept donations to:
             80          (i) make technology system improvements necessary to implement a simplified
             81      enrollment and renewal process for the Medicaid program, Utah Premium Partnership, and
             82      Primary Care Network Demonstration Project programs; and
             83          (ii) conduct an actuarial analysis of the implementation of a basic health care plan in
             84      the state in 2014 to provide coverage options to individuals from 133% to 200% of the federal
             85      poverty level; and
             86          (b) if funding is available[,]:
             87          (i) implement the simplified enrollment and renewal process in accordance with this


             88      section[.]; and
             89          (ii) conduct the actuarial analysis described in Subsection (1)(a)(ii).
             90          (2) The simplified enrollment and renewal process established in this section shall, in
             91      accordance with Section 59-1-403 , provide an eligibility worker a process in which the
             92      eligibility worker:
             93          (a) verifies the applicant's or enrollee's identity;
             94          (b) gets consent to obtain the applicant's adjusted gross income from the State Tax
             95      Commission from:
             96          (i) the applicant or enrollee, if the applicant or enrollee filed a single tax return; or
             97          (ii) both parties to a joint return, if the applicant filed a joint tax return; and
             98          (c) obtains from the State Tax Commission, the adjusted gross income of the applicant
             99      or enrollee.
             100          (3) (a) The department may enter into an agreement with a financial institution doing
             101      business in the state to develop and operate a data match system to identify an applicant's or
             102      enrollee's assets that:
             103          (i) uses automated data exchanges to the maximum extent feasible; and
             104          (ii) requires a financial institution each month to provide the name, record address,
             105      Social Security number, other taxpayer identification number, or other identifying information
             106      for each applicant or enrollee who maintains an account at the financial institution.
             107          (b) The department may pay a reasonable fee to a financial institution for compliance
             108      with this Subsection (3), as provided in Section 7-1-1006 .
             109          (c) A financial institution may not be liable under any federal or state law to any person
             110      for any disclosure of information or action taken in good faith under this Subsection (3).
             111          (d) The department may disclose a financial record obtained from a financial institution
             112      under this section only for the purpose of, and to the extent necessary in, verifying eligibility as
             113      provided in this section and Section 26-40-105 .
             114          [(4) The simplified enrollment and renewal process established under this section shall
             115      be implemented by the department no later than July 1, 2012.]
             116          Section 2. Section 26-18-3.8 is enacted to read:
             117          26-18-3.8. Utah's Premium Partnership For Health Insurance -- Medicaid waiver.
             118          The department shall seek federal approval of an amendment to the state's Utah


             119      Premium Partnership for Health Insurance program to adjust the eligibility determination for
             120      single adults and parents who have an offer of employer sponsored insurance. The amendment
             121      shall:
             122          (1) be within existing appropriations for the Utah Premium Partnership for Health
             123      Insurance program; and
             124          (2) provide that adults who are up to 200% of the federal poverty level are eligible for
             125      premium subsidies in the Utah Premium Partnership for Health Insurance program.
             126          Section 3. Section 26-33a-106.1 is amended to read:
             127           26-33a-106.1. Health care cost and reimbursement data.
             128          (1) (a) The committee shall, as funding is available, establish an advisory panel to
             129      advise the committee on the development of a plan for the collection and use of health care
             130      data pursuant to Subsection 26-33a-104 (6) and this section.
             131          (b) The advisory panel shall include:
             132          (i) the chairman of the Utah Hospital Association;
             133          (ii) a representative of a rural hospital as designated by the Utah Hospital Association;
             134          (iii) a representative of the Utah Medical Association;
             135          (iv) a physician from a small group practice as designated by the Utah Medical
             136      Association;
             137          (v) two representatives who are health insurers, appointed by the committee;
             138          (vi) a representative from the Department of Health as designated by the executive
             139      director of the department;
             140          (vii) a representative from the committee;
             141          (viii) a consumer advocate appointed by the committee;
             142          (ix) a member of the House of Representatives appointed by the speaker of the House;
             143      and
             144          (x) a member of the Senate appointed by the president of the Senate.
             145          (c) The advisory panel shall elect a chair from among its members, and shall be staffed
             146      by the committee.
             147          (2) (a) The committee shall, as funding is available:
             148          (i) establish a plan for collecting data from data suppliers, as defined in Section
             149      26-33a-102 , to determine measurements of cost and reimbursements for risk adjusted episodes


             150      of health care;
             151          [(ii) assist the demonstration projects implemented by the Insurance Department
             152      pursuant to Section 31A-22-614.6 , with access to cost data, reimbursement data, care process
             153      data, and provider service data necessary for the demonstration projects' research, statistical
             154      analysis, and quality improvement activities:]
             155          [(A) notwithstanding Subsection 26-33a-108 (1) and Section 26-33a-109 ;]
             156          [(B) contingent upon approval by the committee; and]
             157          [(C) subject to a contract between the department and the entity providing analysis for
             158      the demonstration project;]
             159          [(iii)] (ii) share data regarding insurance claims and an individual's and small employer
             160      group's health risk factor with insurers participating in the defined contribution market created
             161      in Title 31A, Chapter 30, Part 2, Defined Contribution Arrangements, only to the extent
             162      necessary for:
             163          (A) [renewals of policies] establishing rates and prospective risk adjusting in the
             164      defined contribution arrangement market; and
             165          (B) risk adjusting in the defined contribution arrangement market; and
             166          [(iv)] (iii) assist the Legislature and the public with awareness of, and the promotion
             167      of, transparency in the health care market by reporting on:
             168          (A) geographic variances in medical care and costs as demonstrated by data available
             169      to the committee; and
             170          (B) rate and price increases by health care providers:
             171          (I) that exceed the Consumer Price Index - Medical as provided by the United States
             172      Bureau of Labor statistics;
             173          (II) as calculated yearly from June to June; and
             174          (III) as demonstrated by data available to the committee.
             175          (b) The plan adopted under this Subsection (2) shall include:
             176          (i) the type of data that will be collected;
             177          (ii) how the data will be evaluated;
             178          (iii) how the data will be used;
             179          (iv) the extent to which, and how the data will be protected; and
             180          (v) who will have access to the data.


             181          Section 4. Section 26-33a-106.5 is amended to read:
             182           26-33a-106.5. Comparative analyses.
             183          (1) The committee may publish compilations or reports that compare and identify
             184      health care providers or data suppliers from the data it collects under this chapter or from any
             185      other source.
             186          (2) (a) The committee shall publish compilations or reports from the data it collects
             187      under this chapter or from any other source which:
             188          (i) contain the information described in Subsection (2)(b); and
             189          (ii) compare and identify by name at least a majority of the health care facilities and
             190      institutions in the state.
             191          (b) The report required by this Subsection (2) shall:
             192          (i) be published at least annually; and
             193          (ii) contain comparisons based on at least the following factors:
             194          (A) nationally or other generally recognized quality standards;
             195          (B) charges; and
             196          (C) nationally recognized patient safety standards.
             197          (3) The committee may contract with a private, independent analyst to evaluate the
             198      standard comparative reports of the committee that identify, compare, or rank the performance
             199      of data suppliers by name. The evaluation shall include a validation of statistical
             200      methodologies, limitations, appropriateness of use, and comparisons using standard health
             201      services research practice. The analyst shall be experienced in analyzing large databases from
             202      multiple data suppliers and in evaluating health care issues of cost, quality, and access. The
             203      results of the analyst's evaluation shall be released to the public before the standard
             204      comparative analysis upon which it is based may be published by the committee.
             205          (4) The committee shall adopt by rule a timetable for the collection and analysis of data
             206      from multiple types of data suppliers.
             207          (5) The comparative analysis required under Subsection (2) shall be available:
             208          (a) free of charge and easily accessible to the public; and
             209          (b) on the Health Insurance Exchange either directly or through a link.
             210          (6) (a) [On or before December 1, 2011, the] The department shall include in the report
             211      required by Subsection (2)(b), or include in a separate report, comparative information on


             212      commonly recognized or generally agreed upon measures of quality identified in accordance
             213      with Subsection (7), for:
             214          (i) routine and preventive care; and
             215          (ii) the treatment of diabetes, heart disease, and other illnesses or conditions.
             216          (b) The comparative information required by Subsection (6)(a) shall be based on data
             217      collected under Subsection (2) and clinical data that may be available to the committee, and
             218      shall [be reported as a statewide aggregate for facilities and clinics.] beginning on or after July
             219      1, 2012, compare:
             220          [(c) The department shall, in accordance with Subsection (7)(c), publish reports on or
             221      after July 1, 2012, based on the quality measures described in Subsection (6)(a), using the data
             222      collected under Subsection (2) and clinical data that may be available to the committee, that
             223      compare:]
             224          (i) results for health care facilities or institutions;
             225          (ii) a clinic's aggregate results for a physician who practices at a clinic with five or
             226      more physicians; and
             227          (iii) a geographic region's aggregate results for a physician who practices at a clinic
             228      with less than five physicians, unless the physician requests physician-level data to be
             229      published on a clinic level.
             230          [(d)] (c) The department:
             231          (i) may publish information required by this Subsection (6) directly or through one or
             232      more nonprofit, community-based health data organizations;
             233          (ii) may use a private, independent analyst under Subsection (3) in preparing the report
             234      required by this section; and
             235          (iii) shall identify and report to the Legislature's Health and Human Services Interim
             236      Committee by July 1, 2012, and every July 1, thereafter until July 1, 2015, at least five new
             237      measures of quality to be added to the report each year.
             238          [(e)] (d) A report published by the department under this Subsection (6):
             239          (i) is subject to the requirements of Section 26-33a-107 ; and
             240          (ii) shall, prior to being published by the department, be submitted to a neutral,
             241      non-biased entity with a broad base of support from health care payers and health care
             242      providers in accordance with Subsection (7) for the purpose of validating the report.


             243          (7) (a) The Health Data Committee shall, through the department, for purposes of
             244      Subsection (6)(a), use the quality measures that are developed and agreed upon by a neutral,
             245      non-biased entity with a broad base of support from health care payers and health care
             246      providers.
             247          (b) If the entity described in Subsection (7)(a) does not submit the quality measures
             248      [prior to July 1, 2011], the department may select the appropriate number of quality measures
             249      for purposes of the report required by Subsection (6).
             250          (c) (i) For purposes of the reports published on or after July 1, 2012, the department
             251      may not compare individual facilities or clinics as described in Subsections (6)[(c)](b)(i)
             252      through (iii) if the department determines that the data available to the department can not be
             253      appropriately validated, does not represent nationally recognized measures, does not reflect the
             254      mix of cases seen at a clinic or facility, or is not sufficient for the purposes of comparing
             255      providers.
             256          (ii) The department shall report to the Legislature's Executive Appropriations
             257      Committee prior to making a determination not to publish a report under Subsection (7)(c)(i).
             258          [(d) The committee and the department shall report to the Legislature's Health System
             259      Reform Task Force on or before November 1, 2011, regarding the department's progress in
             260      creating a system to validate the data and address the issues described in Subsection(7)(c).]
             261          Section 5. Section 26-40-106 is amended to read:
             262           26-40-106. Program benefits.
             263          (1) Until the department implements a plan under Subsection (2), program benefits
             264      may include:
             265          (a) hospital services;
             266          (b) physician services;
             267          (c) laboratory services;
             268          (d) prescription drugs;
             269          (e) mental health services;
             270          (f) basic dental services;
             271          (g) preventive care including:
             272          (i) routine physical examinations;
             273          (ii) immunizations;


             274          (iii) basic vision services; and
             275          (iv) basic hearing services;
             276          (h) limited home health and durable medical equipment services; and
             277          (i) hospice care.
             278          (2) (a) Except as provided in Subsection (2)(d), no later than July 1, 2008, the medical
             279      program benefits shall be benchmarked, in accordance with 42 U.S.C. Sec. 1397cc, to be
             280      actuarially equivalent to a health benefit plan with the largest insured commercial enrollment
             281      offered by a health maintenance organization in the state.
             282          (b) Except as provided in Subsection (2)(d), after July 1, [2008] 2012:
             283          (i) medical program benefits may not exceed the benefit level described in Subsection
             284      (2)(a); and
             285          (ii) medical program benefits shall be adjusted every July 1, thereafter to meet the
             286      benefit level described in Subsection (2)(a).
             287          (c) The dental benefit plan shall be benchmarked, in accordance with the Children's
             288      Health Insurance Program Reauthorization Act of 2009, to be equivalent to a dental benefit
             289      plan that has the largest insured, commercial, non-Medicaid enrollment of covered lives that is
             290      offered in the state, except that the utilization review mechanism for orthodontia shall be based
             291      on medical necessity. Dental program benefits shall be adjusted on July 1, 2012, and on July 1
             292      every three years thereafter to meet the benefit level required by this Subsection (2)(c).
             293          (d) The program benefits for enrollees who are at or below 100% of the federal poverty
             294      level are exempt from the benchmark requirements of Subsections (2)(a) and (2)(b).
             295          Section 6. Section 31A-22-613 is amended to read:
             296           31A-22-613. Permitted provisions for accident and health insurance policies.
             297          The following provisions may be contained in an accident and health insurance policy,
             298      but if they are in that policy, they shall conform to at least the minimum requirements for the
             299      policyholder in this section.
             300          (1) Any provision respecting change of occupation may provide only for a lower
             301      maximum benefit payment and for reduction of loss payments proportionate to the change in
             302      appropriate premium rates, if the change is to a higher rated occupation, and this provision
             303      shall provide for retroactive reduction of premium rates from the date of change of occupation
             304      or the last policy anniversary date, whichever is the more recent, if the change is to a lower


             305      rated occupation.
             306          (2) Section 31A-22-405 applies to misstatement of age in accident and health policies,
             307      with the appropriate modifications of terminology.
             308          (3) Any policy which contains a provision establishing, as an age limit or otherwise, a
             309      date after which the coverage provided by the policy is not effective, and if that date falls
             310      within a period for which a premium is accepted by the insurer or if the insurer accepts a
             311      premium after that date, the coverage provided by the policy continues in force, subject to any
             312      right of cancellation, until the end of the period for which the premium was accepted. This
             313      Subsection (3) does not apply if the acceptance of premium would not have occurred but for a
             314      misstatement of age by the insured.
             315          (4) (a) If an insured is otherwise eligible for maternity benefits, a policy may not
             316      contain language which requires an insured to obtain any additional preauthorization or
             317      preapproval for customary and reasonable maternity care expenses or for the delivery of the
             318      child after an initial preauthorization or preapproval has been obtained from the insurer for
             319      prenatal care. A requirement for notice of admission for delivery is not a requirement for
             320      preauthorization or preapproval, however, the maternity benefit may not be denied or
             321      diminished for failure to provide admission notice. The policy may not require the provision of
             322      admission notice by only the insured patient.
             323          (b) This Subsection (4) does not prohibit an insurer from:
             324          (i) requiring a referral before maternity care can be obtained;
             325          (ii) specifying a group of providers or a particular location from which an insured is
             326      required to obtain maternity care; or
             327          (iii) limiting reimbursement for maternity expenses and benefits in accordance with the
             328      terms and conditions of the insurance contract so long as such terms do not conflict with
             329      Subsection (4)(a).
             330          (5) (a) An insurer may only represent that a policy[: (a)] offers a vision benefit if the
             331      policy[: (i) charges a premium for the benefit; and (ii)] provides reimbursement for materials
             332      or services provided under the policy[; and].
             333          (b) An insurer may only represent that a policy covers laser vision correction, whether
             334      photorefractive keratectomy, laser assisted in-situ keratomelusis, or related procedure, if [the
             335      policy: (i) charges a premium for the benefit; and (ii)] the procedure is at least a partially


             336      covered benefit.
             337          (6) If a policy excludes coverage for the diagnosis and treatment of autism spectrum
             338      disorders, the insurer may not deny a claim for a procedure or service that is otherwise covered
             339      in the accident and health insurance policy based on the diagnosis of an autism spectrum
             340      disorder, unless the particular claim is directly related to the autism spectrum disorder.
             341          Section 7. Section 31A-22-613.5 is amended to read:
             342           31A-22-613.5. Price and value comparisons of health insurance.
             343          (1) (a) This section applies to all health benefit plans.
             344          (b) Subsection (2) applies to:
             345          (i) all health benefit plans; and
             346          (ii) coverage offered to state employees under Subsection 49-20-202 (1)(a).
             347          (2) (a) The commissioner shall promote informed consumer behavior and responsible
             348      health benefit plans by requiring an insurer issuing a health benefit plan to:
             349          (i) provide to all enrollees, prior to enrollment in the health benefit plan written
             350      disclosure of:
             351          (A) restrictions or limitations on prescription drugs and biologics including:
             352          (I) the use of a formulary;
             353          (II) co-payments and deductibles for prescription drugs; and
             354          (III) requirements for generic substitution;
             355          (B) coverage limits under the plan; and
             356          (C) any limitation or exclusion of coverage including:
             357          (I) a limitation or exclusion for a secondary medical condition related to a limitation or
             358      exclusion from coverage; and
             359          (II) easily understood examples of a limitation or exclusion of coverage for a secondary
             360      medical condition; and
             361          (ii) provide the commissioner with:
             362          (A) the information described in Subsections 31A-22-635 (5) through (7) in the
             363      standardized electronic format required by Subsection 63M-1-2506 (1); and
             364          (B) information regarding insurer transparency in accordance with Subsection (4).
             365          (b) An insurer shall provide the disclosure required by Subsection (2)(a)(i) in writing to
             366      the commissioner:


             367          (i) upon commencement of operations in the state; and
             368          (ii) anytime the insurer amends any of the following described in Subsection (2)(a)(i):
             369          (A) treatment policies;
             370          (B) practice standards;
             371          (C) restrictions;
             372          (D) coverage limits of the insurer's health benefit plan or health insurance policy; or
             373          (E) limitations or exclusions of coverage including a limitation or exclusion for a
             374      secondary medical condition related to a limitation or exclusion of the insurer's health
             375      insurance plan.
             376          (c) An insurer shall provide the enrollee with notice of an increase in costs for
             377      prescription drug coverage due to a change in benefit design under Subsection (2)(a)(i)(A):
             378          (i) either:
             379          (A) in writing; or
             380          (B) on the insurer's website; and
             381          (ii) at least 30 days prior to the date of the implementation of the increase in cost, or as
             382      soon as reasonably possible.
             383          (d) If under Subsection (2)(a)(i)(A) a formulary is used, the insurer shall make
             384      available to prospective enrollees and maintain evidence of the fact of the disclosure of:
             385          (i) the drugs included;
             386          (ii) the patented drugs not included;
             387          (iii) any conditions that exist as a precedent to coverage; and
             388          (iv) any exclusion from coverage for secondary medical conditions that may result
             389      from the use of an excluded drug.
             390          (e) (i) The commissioner shall develop examples of limitations or exclusions of a
             391      secondary medical condition that an insurer may use under Subsection (2)(a)(i)(C).
             392          (ii) Examples of a limitation or exclusion of coverage provided under Subsection
             393      (2)(a)(i)(C) or otherwise are for illustrative purposes only, and the failure of a particular fact
             394      situation to fall within the description of an example does not, by itself, support a finding of
             395      coverage.
             396          (3) The commissioner:
             397          (a) shall forward the information submitted by an insurer under Subsection (2)(a)(ii) to


             398      the Health Insurance Exchange created under Section 63M-1-2504 ; and
             399          (b) may request information from an insurer to verify the information submitted by the
             400      insurer under this section.
             401          (4) The commissioner shall:
             402          (a) convene a group of insurers, a member representing the Public Employees' Benefit
             403      and Insurance Program, consumers, and an organization [described in Subsection
             404      31A-22-614.6 (3)(b)] that provides multipayer and multiprovider quality assurance and data
             405      collection, to develop information for consumers to compare health insurers and health benefit
             406      plans on the Health Insurance Exchange, which shall include consideration of:
             407          (i) the number and cost of an insurer's denied health claims;
             408          (ii) the cost of denied claims that is transferred to providers;
             409          (iii) the average out-of-pocket expenses incurred by participants in each health benefit
             410      plan that is offered by an insurer in the Health Insurance Exchange;
             411          (iv) the relative efficiency and quality of claims administration and other administrative
             412      processes for each insurer offering plans in the Health Insurance Exchange; and
             413          (v) consumer assessment of each insurer or health benefit plan;
             414          (b) adopt an administrative rule that establishes:
             415          (i) definition of terms;
             416          (ii) the methodology for determining and comparing the insurer transparency
             417      information;
             418          (iii) the data, and format of the data, that an insurer shall submit to the commissioner in
             419      order to facilitate the consumer comparison on the Health Insurance Exchange in accordance
             420      with Section 63M-1-2506 ; and
             421          (iv) the dates on which the insurer shall submit the data to the commissioner in order
             422      for the commissioner to transmit the data to the Health Insurance Exchange in accordance with
             423      Section 63M-1-2506 ; and
             424          (c) implement the rules adopted under Subsection (4)(b) in a manner that protects the
             425      business confidentiality of the insurer.
             426          Section 8. Section 31A-22-635 is amended to read:
             427           31A-22-635. Uniform application -- Uniform waiver of coverage -- Information
             428      on Health Insurance Exchange.


             429          (1) For purposes of this section, "insurer":
             430          (a) is defined in Subsection 31A-22-634 (1); and
             431          (b) includes the state employee's risk pool under Section 49-20-202 .
             432          (2) (a) Insurers offering a health benefit plan to an individual or small employer shall
             433      use a uniform application form.
             434          (b) The uniform application form:
             435          (i) except for cancer and transplants, may not include questions about an applicant's
             436      health history prior to the previous five years; and
             437          (ii) shall be shortened and simplified in accordance with rules adopted by the
             438      commissioner.
             439          (c) Insurers offering a health benefit plan to a small employer shall use a uniform
             440      waiver of coverage form, which may not include health status related questions other than
             441      pregnancy, and is limited to:
             442          (i) information that identifies the employee;
             443          (ii) proof of the employee's insurance coverage; and
             444          (iii) a statement that the employee declines coverage with a particular employer group.
             445          (3) Notwithstanding the requirements of Subsection (2)(a), the uniform application and
             446      uniform waiver of coverage forms may be combined or modified to facilitate a more efficient
             447      and consumer friendly experience for enrollees using the Health Insurance Exchange if the
             448      modification is approved by the commissioner.
             449          (4) The uniform application form, and uniform waiver form, shall be adopted and
             450      approved by the commissioner in accordance with Title 63G, Chapter 3, Utah Administrative
             451      Rulemaking Act.
             452          (5) (a) An insurer who offers a health benefit plan in either the group or individual
             453      market on the Health Insurance Exchange created in Section 63M-1-2504 , shall:
             454          (i) accept and process an electronic submission of the uniform application or uniform
             455      waiver from the Health Insurance Exchange using the electronic standards adopted pursuant to
             456      Section 63M-1-2506 ;
             457          (ii) if requested, provide the applicant with a copy of the completed application either
             458      by mail or electronically;
             459          (iii) post all health benefit plans offered by the insurer in the defined contribution


             460      arrangement market on the Health Insurance Exchange; and
             461          (iv) post the information required by Subsection (6) on the Health Insurance Exchange
             462      for every health benefit plan the insurer offers on the Health Insurance Exchange.
             463          (b) Except as provided in Subsection (5)(c), an insurer who posts health benefit plans
             464      on the Health Insurance Exchange may not directly or indirectly offer products on the Health
             465      Insurance Exchange that are not health benefit plans.
             466          (c) Notwithstanding Subsection (5)(b)[,]:
             467          (i) an insurer may offer a health savings account on the Health Insurance Exchange[.];
             468      and
             469          (ii) an insurer may offer dental and vision plans on the Health Insurance Exchange if:
             470          (A) the department determines, after study and consultation with the Health System
             471      Reform Task Force, that the department is able to establish standards for dental and vision
             472      policies offered on the health insurance exchange, and the department determines whether a
             473      risk adjuster mechanism is necessary for a defined contribution vision and dental plan market
             474      on the Health Insurance Exchange; and
             475          (B) the department, in accordance with recommendations from the Health System
             476      Reform Task Force, adopts administrative rules to regulate the offer of dental and vision plans
             477      on the Health Insurance Exchange.
             478          (6) An insurer shall provide the commissioner and the Health Insurance Exchange with
             479      the following information for each health benefit plan submitted to the Health Insurance
             480      Exchange, in the electronic format required by Subsection 63M-1-2506 (1):
             481          (a) plan design, benefits, and options offered by the health benefit plan including state
             482      mandates the plan does not cover;
             483          (b) information and Internet address to online provider networks;
             484          (c) wellness programs and incentives;
             485          (d) descriptions of prescription drug benefits, exclusions, or limitations;
             486          (e) the percentage of claims paid by the insurer within 30 days of the date a claim is
             487      submitted to the insurer for the prior year; and
             488          (f) the claims denial and insurer transparency information developed in accordance
             489      with Subsection 31A-22-613.5 (4).
             490          (7) The Insurance Department shall post on the Health Insurance Exchange the


             491      Insurance Department's solvency rating for each insurer who posts a health benefit plan on the
             492      Health Insurance Exchange. The solvency rating for each insurer shall be based on
             493      methodology established by the Insurance Department by administrative rule and shall be
             494      updated each calendar year.
             495          (8) (a) The commissioner may request information from an insurer under Section
             496      31A-22-613.5 to verify the data submitted to the Insurance Department and to the Health
             497      Insurance Exchange.
             498          (b) The commissioner shall regulate any fees charged by insurers to an enrollee for a
             499      uniform application form or electronic submission of the application forms.
             500          Section 9. Section 31A-23a-402.5 is amended to read:
             501           31A-23a-402.5. Inducements.
             502          (1) (a) Except as provided in Subsection (2), a licensee under this title, or an officer or
             503      employee of a licensee, may not induce a person to enter into, continue, or terminate an
             504      insurance contract by offering a benefit that is not:
             505          (i) specified in the insurance contract; or
             506          (ii) directly related to the insurance contract.
             507          (b) An insurer may not make or knowingly allow an agreement of insurance that is not
             508      clearly expressed in the insurance contract to be issued or renewed.
             509          (c) A licensee under this title may not absorb the tax under Section 31A-3-301 .
             510          (2) This section does not apply to a title insurer, a title producer, or an officer or
             511      employee of a title insurer or title producer.
             512          (3) Items not prohibited by Subsection (1) include an insurer:
             513          (a) reducing premiums because of expense savings;
             514          (b) providing to a policyholder or insured one or more incentives, as defined by the
             515      commissioner by rule made in accordance with Title 63G, Chapter 3, Utah Administrative
             516      Rulemaking Act, to participate in a program or activity designed to reduce claims or claim
             517      expenses[; or], including:
             518          (i) a premium discount offered to a small or large employer group based on a wellness
             519      program if:
             520          (A) the premium discount for the employer group does not exceed 20% of the group
             521      premium; and


             522          (B) the premium discount based on the wellness program is offered uniformly by the
             523      insurer to all employer groups in the large or small group market;
             524          (ii) a premium discount offered to employees of a small or large employer group in an
             525      amount that does not exceed federal limits on wellness program incentives; or
             526          (iii) a combination of premium discounts offered to the employer group and the
             527      employees of an employer group, based on a wellness program, if:
             528          (A) the premium discounts for the employer group comply with Subsection (3)(b)(i);
             529      and
             530          (B) the premium discounts for the employees of an employer group comply with
             531      Subsection (3)(b)(ii); or
             532          (c) receiving premiums under an installment payment plan.
             533          (4) Items not prohibited by Subsection (1) include a licensee, or an officer or employee
             534      of a licensee, either directly or through a third party:
             535          (a) engaging in a usual kind of social courtesy if receipt of the social courtesy is not
             536      conditioned on the purchase of a particular insurance product;
             537          (b) extending credit on a premium to the insured:
             538          (i) without interest, for no more than 90 days from the effective date of the insurance
             539      contract;
             540          (ii) for interest that is not less than the legal rate under Section 15-1-1 , on the unpaid
             541      balance after the time period described in Subsection (4)(b)(i); and
             542          (iii) except that an installment or payroll deduction payment of premiums on an
             543      insurance contract issued under an insurer's mass marketing program is not considered an
             544      extension of credit for purposes of this Subsection (4)(b);
             545          (c) preparing or conducting a survey that:
             546          (i) is directly related to an accident and health insurance policy purchased from the
             547      licensee; or
             548          (ii) is used by the licensee to assess the benefit needs and preferences of insureds,
             549      employers, or employees directly related to an insurance product sold by the licensee;
             550          (d) providing limited human resource services that are directly related to an insurance
             551      product sold by the licensee, including:
             552          (i) answering questions directly related to:


             553          (A) an employee benefit offering or administration, if the insurance product purchased
             554      from the licensee is accident and health insurance or health insurance; and
             555          (B) employment practices liability, if the insurance product purchased from the
             556      licensee is property or casualty insurance; and
             557          (ii) providing limited human resource compliance training and education directly
             558      pertaining to an insurance product purchased from the licensee;
             559          (e) providing the following types of information or guidance:
             560          (i) providing guidance directly related to compliance with federal and state laws for an
             561      insurance product purchased from the licensee;
             562          (ii) providing a workshop or seminar addressing an insurance issue that is directly
             563      related to an insurance product purchased from the licensee; or
             564          (iii) providing information regarding:
             565          (A) employee benefit issues;
             566          (B) directly related insurance regulatory and legislative updates; or
             567          (C) similar education about an insurance product sold by the licensee and how the
             568      insurance product interacts with tax law;
             569          (f) preparing or providing a form that is directly related to an insurance product
             570      purchased from, or offered by, the licensee;
             571          (g) preparing or providing documents directly related to a flexible spending account,
             572      but not providing ongoing administration of a flexible spending account;
             573          (h) providing enrollment and billing assistance, including:
             574          (i) providing benefit statements or new hire insurance benefits packages; and
             575          (ii) providing technology services such as an electronic enrollment platform or
             576      application system;
             577          (i) communicating coverages in writing and in consultation with the insured and
             578      employees;
             579          (j) providing employee communication materials and notifications directly related to an
             580      insurance product purchased from a licensee;
             581          (k) providing claims management and resolution to the extent permitted under the
             582      licensee's license;
             583          (l) providing underwriting or actuarial analysis or services;


             584          (m) negotiating with an insurer regarding the placement and pricing of an insurance
             585      product;
             586          (n) recommending placement and coverage options;
             587          (o) providing a health fair or providing assistance or advice on establishing or
             588      operating a wellness program, but not providing any payment for or direct operation of the
             589      wellness program;
             590          (p) providing COBRA and Utah mini-COBRA administration, consultations, and other
             591      services directly related to an insurance product purchased from the licensee;
             592          (q) assisting with a summary plan description;
             593          (r) providing information necessary for the preparation of documents directly related to
             594      the Employee Retirement Income Security Act of 1974, 29 U.S.C. Sec. 1001, et seq., as
             595      amended;
             596          (s) providing information or services directly related to the Health Insurance Portability
             597      and Accountability Act of 1996, Pub. L. 104-191, 110 Stat. 1936, as amended, such as services
             598      directly related to health care access, portability, and renewability when offered in connection
             599      with accident and health insurance sold by a licensee;
             600          (t) sending proof of coverage to a third party with a legitimate interest in coverage;
             601          (u) providing information in a form approved by the commissioner and directly related
             602      to determining whether an insurance product sold by the licensee meets the requirements of a
             603      third party contract that requires or references insurance coverage;
             604          (v) facilitating risk management services directly related to the insurance product sold
             605      or offered for sale by the licensee, including:
             606          (i) risk management;
             607          (ii) claims and loss control services; and
             608          (iii) risk assessment consulting;
             609          (w) otherwise providing services that are legitimately part of servicing an insurance
             610      product purchased from a licensee; and
             611          (x) providing other directly related services approved by the department.
             612          (5) An inducement prohibited under Subsection (1) includes a licensee, or an officer or
             613      employee of a licensee:
             614          (a) (i) providing a premium or commission rebate;


             615          (ii) paying the salary of an employee of a person who purchases an insurance product
             616      from the licensee; or
             617          (iii) if the licensee is an insurer, or a third party administrator who contracts with an
             618      insurer, paying the salary for an onsite staff member to perform an act prohibited under
             619      Subsection (5)(b)(xii); or
             620          (b) engaging in one or more of the following unless a fee is paid in accordance with
             621      Subsection (7):
             622          (i) performing background checks of prospective employees;
             623          (ii) providing legal services by a person licensed to practice law;
             624          (iii) performing drug testing that is directly related to an insurance product purchased
             625      from the licensee;
             626          (iv) preparing employer or employee handbooks, except that a licensee may:
             627          (A) provide information for a medical benefit section of an employee handbook;
             628          (B) provide information for the section of an employee handbook directly related to an
             629      employment practices liability insurance product purchased from the licensee; or
             630          (C) prepare or print an employee benefit enrollment guide;
             631          (v) providing job descriptions, postings, and applications for a person that purchases an
             632      employment practices liability insurance product from the licensee;
             633          (vi) providing payroll services;
             634          (vii) providing performance reviews or performance review training;
             635          (viii) providing union advice;
             636          (ix) providing accounting services;
             637          (x) providing data analysis information technology programs, except as provided in
             638      Subsection (4)(h)(ii);
             639          (xi) providing administration of health reimbursement accounts or health savings
             640      accounts; or
             641          (xii) if the licensee is an insurer, or a third party administrator who contracts with an
             642      insurer, the insurer issuing an insurance policy that lists in the insurance policy one or more of
             643      the following prohibited benefits:
             644          (A) performing background checks of prospective employees;
             645          (B) providing legal services by a person licensed to practice law;


             646          (C) performing drug testing that is directly related to an insurance product purchased
             647      from the insurer;
             648          (D) preparing employer or employee handbooks;
             649          (E) providing job descriptions postings, and applications;
             650          (F) providing payroll services;
             651          (G) providing performance reviews or performance review training;
             652          (H) providing union advice;
             653          (I) providing accounting services;
             654          (J) providing discrimination testing; or
             655          (K) providing data analysis information technology programs.
             656          (6) A de minimis gift or meal not to exceed $25 for each individual receiving the gift
             657      or meal is presumed to be a social courtesy not conditioned on the purchase of a particular
             658      insurance product for purposes of Subsection (4)(a).
             659          (7) If as provided under Subsection (5)(b) a licensee is paid a fee to provide an item
             660      listed in Subsection (5)(b), the licensee shall comply with Subsection 31A-23a-501 (2) in
             661      charging the fee, except that the fee paid for the item shall equal or exceed the fair market
             662      value of the item.
             663          Section 10. Section 31A-23a-501 is amended to read:
             664           31A-23a-501. Licensee compensation.
             665          (1) As used in this section:
             666          (a) "Commission compensation" includes funds paid to or credited for the benefit of a
             667      licensee from:
             668          (i) commission amounts deducted from insurance premiums on insurance sold by or
             669      placed through the licensee; or
             670          (ii) commission amounts received from an insurer or another licensee as a result of the
             671      sale or placement of insurance.
             672          (b) (i) "Compensation from an insurer or third party administrator" means
             673      commissions, fees, awards, overrides, bonuses, contingent commissions, loans, stock options,
             674      gifts, prizes, or any other form of valuable consideration:
             675          (A) whether or not payable pursuant to a written agreement; and
             676          (B) received from:


             677          (I) an insurer; or
             678          (II) a third party to the transaction for the sale or placement of insurance.
             679          (ii) "Compensation from an insurer or third party administrator" does not mean
             680      compensation from a customer that is:
             681          (A) a fee or pass-through costs as provided in Subsection (1)(e); or
             682          (B) a fee or amount collected by or paid to the producer that does not exceed an
             683      amount established by the commissioner by administrative rule.
             684          (c) (i) "Customer" means:
             685          (A) the person signing the application or submission for insurance; or
             686          (B) the authorized representative of the insured actually negotiating the placement of
             687      insurance with the producer.
             688          (ii) "Customer" does not mean a person who is a participant or beneficiary of:
             689          (A) an employee benefit plan; or
             690          (B) a group or blanket insurance policy or group annuity contract sold, solicited, or
             691      negotiated by the producer or affiliate.
             692          (d) (i) "Noncommission compensation" includes all funds paid to or credited for the
             693      benefit of a licensee other than commission compensation.
             694          (ii) "Noncommission compensation" does not include charges for pass-through costs
             695      incurred by the licensee in connection with obtaining, placing, or servicing an insurance policy.
             696          (e) "Pass-through costs" include:
             697          (i) costs for copying documents to be submitted to the insurer; and
             698          (ii) bank costs for processing cash or credit card payments.
             699          (2) A licensee may receive from an insured or from a person purchasing an insurance
             700      policy, noncommission compensation if the noncommission compensation is stated on a
             701      separate, written disclosure.
             702          (a) The disclosure required by this Subsection (2) shall:
             703          (i) include the signature of the insured or prospective insured acknowledging the
             704      noncommission compensation;
             705          (ii) clearly specify the amount or extent of the noncommission compensation; and
             706          (iii) be provided to the insured or prospective insured before the performance of the
             707      service.


             708          (b) Noncommission compensation shall be:
             709          (i) limited to actual or reasonable expenses incurred for services; and
             710          (ii) uniformly applied to all insureds or prospective insureds in a class or classes of
             711      business or for a specific service or services.
             712          (c) A copy of the signed disclosure required by this Subsection (2) shall be maintained
             713      by any licensee who collects or receives the noncommission compensation or any portion of
             714      the noncommission compensation.
             715          (d) All accounting records relating to noncommission compensation shall be
             716      maintained by the person described in Subsection (2)(c) in a manner that facilitates an audit.
             717          (3) (a) A licensee may receive noncommission compensation when acting as a
             718      producer for the insured in connection with the actual sale or placement of insurance if:
             719          (i) the producer and the insured have agreed on the producer's noncommission
             720      compensation; and
             721          (ii) the producer has disclosed to the insured the existence and source of any other
             722      compensation that accrues to the producer as a result of the transaction.
             723          (b) The disclosure required by this Subsection (3) shall:
             724          (i) include the signature of the insured or prospective insured acknowledging the
             725      noncommission compensation;
             726          (ii) clearly specify the amount or extent of the noncommission compensation and the
             727      existence and source of any other compensation; and
             728          (iii) be provided to the insured or prospective insured before the performance of the
             729      service.
             730          (c) The following additional noncommission compensation is authorized:
             731          (i) compensation received by a producer of a compensated corporate surety who under
             732      procedures approved by a rule or order of the commissioner is paid by surety bond principal
             733      debtors for extra services;
             734          (ii) compensation received by an insurance producer who is also licensed as a public
             735      adjuster under Section 31A-26-203 , for services performed for an insured in connection with a
             736      claim adjustment, so long as the producer does not receive or is not promised compensation for
             737      aiding in the claim adjustment prior to the occurrence of the claim;
             738          (iii) compensation received by a consultant as a consulting fee, provided the consultant


             739      complies with the requirements of Section 31A-23a-401 ; or
             740          (iv) other compensation arrangements approved by the commissioner after a finding
             741      that they do not violate Section 31A-23a-401 and are not harmful to the public.
             742          (4) (a) For purposes of this Subsection (4), "producer" includes:
             743          (i) a producer;
             744          (ii) an affiliate of a producer; or
             745          (iii) a consultant.
             746          (b) [Beginning January 1, 2010, in addition to any other disclosures required by this
             747      section, a] A producer may not accept or receive any compensation from an insurer or third
             748      party administrator for the initial placement of a health benefit plan, other than a hospital
             749      confinement indemnity policy, unless prior to the customer's initial purchase of the health
             750      benefit plan the producer[: (i) except as provided in Subsection (4)(c),] discloses in writing to
             751      the customer that the producer will receive compensation from the insurer or third party
             752      administrator for the placement of insurance, including the amount or type of compensation
             753      known to the producer at the time of the disclosure[; and].
             754          [(ii) except as provided in Subsection (4)(c):]
             755          [(A) obtains] (c) A producer shall:
             756          (i) obtain the customer's signed acknowledgment that the disclosure under Subsection
             757      (4)(b)[(i)] was made to the customer; or
             758          [(B) (I) signs] (ii) (A) sign a statement that the disclosure required by Subsection
             759      (4)(b)[(i)] was made to the customer; and
             760          [(II) keeps] (B) keep the signed statement on file in the producer's office while the
             761      health benefit plan placed with the customer is in force.
             762          [(c) If the compensation to the producer from an insurer or third party administrator is
             763      for the renewal of a health benefit plan, once the producer has made an initial disclosure that
             764      complies with Subsection (4)(b), the producer does not have to disclose compensation received
             765      for the subsequent yearly renewals in accordance with Subsection (4)(b) until the renewal
             766      period immediately following 36 months after the initial disclosure.]
             767          (d) (i) A licensee who collects or receives any part of the compensation from an insurer
             768      or third party administrator in a manner that facilitates an audit shall, while the health benefit
             769      plan placed with the customer is in force, maintain a copy of:


             770          (A) the signed acknowledgment described in Subsection (4)[(b)(i)](c)(i); or
             771          (B) the signed statement described in Subsection (4)[(b)(ii)](c)(ii).
             772          (ii) The standard application developed in accordance with Section 31A-22-635 shall
             773      include a place for a producer to provide the disclosure required by this Subsection (4), and if
             774      completed, shall satisfy the requirement of Subsection (4)(d)(i).
             775          (e) Subsection (4)[(b)(ii)](c) does not apply to:
             776          (i) a person licensed as a producer who acts only as an intermediary between an insurer
             777      and the customer's producer, including a managing general agent; or
             778          (ii) the placement of insurance in a secondary or residual market.
             779          (5) This section does not alter the right of any licensee to recover from an insured the
             780      amount of any premium due for insurance effected by or through that licensee or to charge a
             781      reasonable rate of interest upon past-due accounts.
             782          (6) This section does not apply to bail bond producers or bail enforcement agents as
             783      defined in Section 31A-35-102 .
             784          (7) A licensee may not receive noncommission compensation from an insured or
             785      enrollee for providing a service or engaging in an act that is required to be provided or
             786      performed in order to receive commission compensation, except for the surplus lines
             787      transactions that do not receive commissions.
             788          Section 11. Section 31A-30-106.1 is amended to read:
             789           31A-30-106.1. Small employer premiums -- Rating restrictions -- Disclosure.
             790          (1) Premium rates for small employer health benefit plans under this chapter are
             791      subject to this section.
             792          (2) (a) The index rate for a rating period for any class of business may not exceed the
             793      index rate for any other class of business by more than 20%.
             794          (b) For a class of business, the premium rates charged during a rating period to covered
             795      insureds with similar case characteristics for the same or similar coverage, or the rates that
             796      could be charged to an employer group under the rating system for that class of business, may
             797      not vary from the index rate by more than 30% of the index rate, except when catastrophic
             798      mental health coverage is selected as provided in Subsection 31A-22-625 (2)(d).
             799          (3) The percentage increase in the premium rate charged to a covered insured for a new
             800      rating period, adjusted pro rata for rating periods less than a year, may not exceed the sum of


             801      the following:
             802          (a) the percentage change in the new business premium rate measured from the first
             803      day of the prior rating period to the first day of the new rating period;
             804          (b) any adjustment, not to exceed 15% annually and adjusted pro rata for rating periods
             805      of less than one year, due to the claim experience, health status, or duration of coverage of the
             806      covered individuals as determined from the small employer carrier's rate manual for the class of
             807      business, except when catastrophic mental health coverage is selected as provided in
             808      Subsection 31A-22-625 (2)(d); and
             809          (c) any adjustment due to change in coverage or change in the case characteristics of
             810      the covered insured as determined for the class of business from the small employer carrier's
             811      rate manual.
             812          (4) (a) Adjustments in rates for claims experience, health status, and duration from
             813      issue may not be charged to individual employees or dependents.
             814          (b) Rating adjustments and factors, including case characteristics, shall be applied
             815      uniformly and consistently to the rates charged for all employees and dependents of the small
             816      employer.
             817          (c) Rating factors shall produce premiums for identical groups that:
             818          (i) differ only by the amounts attributable to plan design; and
             819          (ii) do not reflect differences due to the nature of the groups assumed to select
             820      particular health benefit products.
             821          (d) A small employer carrier shall treat all health benefit plans issued or renewed in the
             822      same calendar month as having the same rating period.
             823          (5) A health benefit plan that uses a restricted network provision may not be considered
             824      similar coverage to a health benefit plan that does not use a restricted network provision,
             825      provided that use of the restricted network provision results in substantial difference in claims
             826      costs.
             827          (6) The small employer carrier may not use case characteristics other than the
             828      following:
             829          (a) age of the employee, in accordance with Subsection (7);
             830          (b) geographic area;
             831          (c) family composition in accordance with Subsection (9);


             832          (d) for plans renewed or effective on or after July 1, 2011, gender of the employee and
             833      spouse; [and]
             834          (e) for an individual age 65 and older, whether the employer policy is primary or
             835      secondary to Medicare[.]; and
             836          (f) a wellness program, in accordance with Subsection (12).
             837          (7) Age limited to:
             838          (a) the following age bands:
             839          (i) less than 20;
             840          (ii) 20-24;
             841          (iii) 25-29;
             842          (iv) 30-34;
             843          (v) 35-39;
             844          (vi) 40-44;
             845          (vii) 45-49;
             846          (viii) 50-54;
             847          (ix) 55-59;
             848          (x) 60-64; and
             849          (xi) 65 and above; and
             850          (b) a standard slope ratio range for each age band, applied to each family composition
             851      tier rating structure under Subsection (9)(b):
             852          (i) as developed by the commissioner by administrative rule; and
             853          (ii) not to exceed an overall ratio as provided in Subsection (8).
             854          (8) (a) The overall ratio permitted in Subsection (7)(b)(ii) may not exceed:
             855          (i) 5:1 for plans renewed or effective before January 1, 2012; and
             856          (ii) 6:1 for plans renewed or effective on or after January 1, 2012; and
             857          (b) the age slope ratios for each age band may not overlap.
             858          (9) Except as provided in Subsection 31A-30-207 (2), family composition is limited to:
             859          (a) an overall ratio of:
             860          (i) 5:1 or less for plans renewed or effective before January 1, 2012; and
             861          (ii) 6:1 or less for plans renewed or effective on or after January 1, 2012; and
             862          (b) a tier rating structure that includes:


             863          (i) four tiers that include:
             864          (A) employee only;
             865          (B) employee plus spouse;
             866          (C) employee plus a child or children; and
             867          (D) a family, consisting of an employee plus spouse, and a child or children;
             868          (ii) for plans renewed or effective on or after January 1, 2012, five tiers that include:
             869          (A) employee only;
             870          (B) employee plus spouse;
             871          (C) employee plus one child;
             872          (D) employee plus two or more children; and
             873          (E) employee plus spouse plus one or more children; or
             874          (iii) for plans renewed or effective on or after January 1, 2012, six tiers that include:
             875          (A) employee only;
             876          (B) employee plus spouse;
             877          (C) employee plus one child;
             878          (D) employee plus two or more children;
             879          (E) employee plus spouse plus one child; and
             880          (F) employee plus spouse plus two or more children.
             881          (10) If a health benefit plan is a health benefit plan into which the small employer
             882      carrier is no longer enrolling new covered insureds, the small employer carrier shall use the
             883      percentage change in the base premium rate, provided that the change does not exceed, on a
             884      percentage basis, the change in the new business premium rate for the most similar health
             885      benefit product into which the small employer carrier is actively enrolling new covered
             886      insureds.
             887          (11) (a) A covered carrier may not transfer a covered insured involuntarily into or out
             888      of a class of business.
             889          (b) A covered carrier may not offer to transfer a covered insured into or out of a class
             890      of business unless the offer is made to transfer all covered insureds in the class of business
             891      without regard to:
             892          (i) case characteristics;
             893          (ii) claim experience;


             894          (iii) health status; or
             895          (iv) duration of coverage since issue.
             896          (12) Notwithstanding Subsection (4)(b), a small employer carrier may:
             897          (a) offer a wellness program to a small employer group if:
             898          (i) the premium discount to the employer for the wellness program does not exceed
             899      20% of the premium for the small employer group; and
             900          (ii) the carrier offers the wellness program discount uniformly across all small
             901      employer groups;
             902          (b) offer a premium discount as part of a wellness program to individual employees in
             903      a small employer group:
             904          (i) to the extent allowed by federal law; and
             905          (ii) if the employee discount based on the wellness program is offered uniformly across
             906      all small employer groups; and
             907          (c) offer a combination of premium discounts for the employer and the employee,
             908      based on a wellness program, if:
             909          (i) the employer discount complies with Subsection (12)(a); and
             910          (ii) the employee discount complies with Subsection (12)(b).
             911          [(12)] (13) (a) Each small employer carrier shall maintain at the small employer
             912      carrier's principal place of business a complete and detailed description of its rating practices
             913      and renewal underwriting practices, including information and documentation that demonstrate
             914      that the small employer carrier's rating methods and practices are:
             915          (i) based upon commonly accepted actuarial assumptions; and
             916          (ii) in accordance with sound actuarial principles.
             917          (b) (i) Each small employer carrier shall file with the commissioner on or before April
             918      1 of each year, in a form and manner and containing information as prescribed by the
             919      commissioner, an actuarial certification certifying that:
             920          (A) the small employer carrier is in compliance with this chapter; and
             921          (B) the rating methods of the small employer carrier are actuarially sound.
             922          (ii) A copy of the certification required by Subsection [(12)] (13)(b)(i) shall be retained
             923      by the small employer carrier at the small employer carrier's principal place of business.
             924          (c) A small employer carrier shall make the information and documentation described


             925      in this Subsection [(12)] (13) available to the commissioner upon request.
             926          [(13)] (14) (a) The commissioner shall establish rules in accordance with Title 63G,
             927      Chapter 3, Utah Administrative Rulemaking Act, to:
             928          (i) implement this chapter; and
             929          (ii) assure that rating practices used by small employer carriers under this section and
             930      carriers for individual plans under Section 31A-30-106 are consistent with the purposes of this
             931      chapter.
             932          (b) The rules may:
             933          (i) assure that differences in rates charged for health benefit plans by carriers are
             934      reasonable and reflect objective differences in plan design, not including differences due to the
             935      nature of the groups or individuals assumed to select particular health benefit plans; and
             936          (ii) prescribe the manner in which case characteristics may be used by small employer
             937      and individual carriers.
             938          [(14)] (15) Records submitted to the commissioner under this section shall be
             939      maintained by the commissioner as protected records under Title 63G, Chapter 2, Government
             940      Records Access and Management Act.
             941          Section 12. Section 31A-30-116 is enacted to read:
             942          31A-30-116. Essential health benefits.
             943          (1) For purposes of this section, the "Affordable Care Act" is as defined in Section
             944      31A-2-212 and includes federal rules related to the offering of essential health benefits.
             945          (2) The state chooses to designate its own essential health benefits rather than accept a
             946      federal determination of the essential health benefits required to be offered in the individual
             947      and small group market for plans renewed or offered on or after January 1, 2014.
             948          (3) (a) Subject to Subsections (3)(b) and (c), to the extent required by the Affordable
             949      Care Act, and after considering public testimony, the Legislature's Health System Reform Task
             950      Force shall recommend to the commissioner, no later than September 1, 2012, a benchmark
             951      plan for the state's essential health benefits based on:
             952          (i) the largest plan by enrollment in any of the three largest small employer group
             953      insurance products in the state's small employer group market;
             954          (ii) any of the largest three state employee health benefit plans by enrollment;
             955          (iii) the largest insured commercial non-Medicaid health maintenance organization


             956      operating in the state; or
             957          (iv) other benchmarks required or permitted by the Affordable Care Act.
             958          (b) Notwithstanding the provisions of Subsection 63M-1-2505.5 (2), based on the
             959      recommendation of the task force under Subsection (3)(a), and within 30 days of the task force
             960      recommendation, the commissioner shall adopt an emergency administrative rule that
             961      designates the essential health benefits that shall be included in a plan offered or renewed on or
             962      after January 1, 2014, in the small employer group and individual markets.
             963          (c) The essential health benefit plan:
             964          (i) shall not include a state mandate if the inclusion of the state mandate would require
             965      the state to contribute to premium subsidies under the Affordable Care Act; and
             966          (ii) may add benefits in addition to the benefits included in a benchmark plan described
             967      in Subsection (3)(b) if the additional benefits are mandated under the Affordable Care Act.
             968          Section 13. Section 63I-2-231 is amended to read:
             969           63I-2-231. Repeal dates, Title 31A.
             970          Title 31A, Chapter 42, Defined Contribution Risk Adjuster Act, is repealed [January 1,
             971      2013] July 1, 2013.
             972          Section 14. Section 63M-1-2504 is amended to read:
             973           63M-1-2504. Creation of Office of Consumer Health Services -- Duties.
             974          (1) There is created within the Governor's Office of Economic Development the Office
             975      of Consumer Health Services.
             976          (2) The office shall:
             977          (a) in cooperation with the Insurance Department, the Department of Health, and the
             978      Department of Workforce Services, and in accordance with the electronic standards developed
             979      under Sections 31A-22-635 and 63M-1-2506 , create a Health Insurance Exchange that:
             980          (i) provides information to consumers about private and public health programs for
             981      which the consumer may qualify;
             982          (ii) provides a consumer comparison of and enrollment in a health benefit plan posted
             983      on the Health Insurance Exchange; and
             984          (iii) includes information and a link to enrollment in premium assistance programs and
             985      other government assistance programs;
             986          (b) contract with one or more private vendors for:


             987          (i) administration of the enrollment process on the Health Insurance Exchange,
             988      including establishing a mechanism for consumers to compare health benefit plan features on
             989      the exchange and filter the plans based on consumer preferences;
             990          (ii) the collection of health insurance premium payments made for a single policy by
             991      multiple payers, including the policyholder, one or more employers of one or more individuals
             992      covered by the policy, government programs, and others; and
             993          (iii) establishing a call center in accordance with Subsection (3);
             994          (c) assist employers with a free or low cost method for establishing mechanisms for the
             995      purchase of health insurance by employees using pre-tax dollars;
             996          (d) establish a list on the Health Insurance Exchange of insurance producers who, in
             997      accordance with Section 31A-30-209 , are appointed producers for the Health Insurance
             998      Exchange; and
             999          (e) report to the Business and Labor Interim Committee and the Health System Reform
             1000      Task Force [prior to November 1, 2011, and] prior to the Legislative interim day in November
             1001      of each year [thereafter] regarding the operations of the Health Insurance Exchange required by
             1002      this chapter.
             1003          (3) A call center established by the office:
             1004          (a) shall provide unbiased answers to questions concerning exchange operations, and
             1005      plan information, to the extent the plan information is posted on the exchange by the insurer;
             1006      and
             1007          (b) may not:
             1008          (i) sell, solicit, or negotiate a health benefit plan on the Health Insurance Exchange;
             1009          (ii) [beginning July 1, 2011,] receive producer compensation through the Health
             1010      Insurance Exchange; and
             1011          (iii) [beginning July 1, 2011,] be designated as the default producer for an employer
             1012      group that enters the Health Insurance Exchange without a producer.
             1013          (4) The office:
             1014          (a) may not:
             1015          (i) regulate health insurers, health insurance plans, health insurance producers, or
             1016      health insurance premiums charged in the exchange;
             1017          (ii) adopt administrative rules, except as provided in Section 63M-1-2506 ; or


             1018          (iii) act as an appeals entity for resolving disputes between a health insurer and an
             1019      insured;
             1020          (b) may establish and collect a fee for the cost of the exchange transaction in
             1021      accordance with Section 63J-1-504 for:
             1022          [(i) the transaction cost of:]
             1023          [(A)] (i) processing an application for a health benefit plan;
             1024          [(B)] (ii) accepting, processing, and submitting multiple premium payment sources;
             1025      [and]
             1026          [(C)] (iii) providing a mechanism for consumers to filter and compare health benefit
             1027      plans in the exchange based on consumer preferences; and
             1028          [(ii)] (iv) funding the call center [established in accordance with Subsection (3)]; and
             1029          (c) shall separately itemize [any fees] the fee established under Subsection (4)(b) as
             1030      part of the cost displayed for the employer selecting coverage on the exchange.
             1031          Section 15. Repealer.
             1032          This bill repeals:
             1033          Section 26-1-39, Health System Reform Demonstration Projects.
             1034          Section 31A-22-614.6, Health care delivery and payment reform demonstration
             1035      projects.
             1036          Section 16. Health System Reform Task Force -- Creation -- Membership --
             1037      Interim rules followed -- Compensation -- Staff.
             1038          (1) There is created the Health System Reform Task Force consisting of the following
             1039      11 members:
             1040          (a) four members of the Senate appointed by the president of the Senate, no more than
             1041      three of whom may be from the same political party; and
             1042          (b) seven members of the House of Representatives appointed by the speaker of the
             1043      House of Representatives, no more than five of whom may be from the same political party.
             1044          (2) (a) The president of the Senate shall designate a member of the Senate appointed
             1045      under Subsection (1)(a) as a cochair of the committee.
             1046          (b) The speaker of the House of Representatives shall designate a member of the House
             1047      of Representatives appointed under Subsection (1)(b) as a cochair of the committee.
             1048          (3) In conducting its business, the committee shall comply with the rules of legislative


             1049      interim committees.
             1050          (4) Salaries and expenses of the members of the committee shall be paid in accordance
             1051      with Section 36-2-2 and Legislative Joint Rules, Title 5, Chapter 3, Expense and Mileage
             1052      Reimbursement for Authorized Legislative Meetings, Special Sessions, and Veto Override
             1053      Sessions.
             1054          (5) The Office of Legislative Research and General Counsel shall provide staff support
             1055      to the committee.
             1056          Section 17. Duties -- Interim report.
             1057          (1) The committee shall review and make recommendations on the following issues:
             1058          (a) the state's response to federal health care reform;
             1059          (b) health coverage for children in the state;
             1060          (c) the role and regulation of navigators assisting individuals with the selection and
             1061      purchase of health benefit plans;
             1062          (d) health insurance plans available on the Utah Health Exchange, including dental and
             1063      vision plans and whether dental and vision plans can be included on the exchange in 2013;
             1064          (e) the governance structure of the Utah Health Exchange, including advisory boards
             1065      for the Utah Health Exchange or any other health exchange developed in the state;
             1066          (f) no later than September 1, 2012, a recommendation to the Insurance Commissioner
             1067      regarding a benchmark plan for the essential health benefit plan in the individual and small
             1068      employer group market in the state;
             1069          (g) the role of the state's high risk pool as a provider of a high risk product and its role
             1070      in the establishment of a transitional reinsurance program;
             1071          (h) the risk adjustment mechanism for the health exchange and methods to develop and
             1072      administer a risk adjustment system that limits the administrative burden on government and
             1073      health insurance plans, and creates stability in the insurance market;
             1074          (i) whether the state should consider developing and offering a basic health plan in
             1075      2014 to provide coverage options for individuals from 133% to 200% of the federal poverty
             1076      level;
             1077          (j) strategies to manage Medicaid expansion in 2014, including whether the Medicaid
             1078      benefit plan should be the same as, or different from, the essential health benefit plan in the
             1079      private insurance market;


             1080          (k) individuals with dual health insurance coverage and the impact on the market;
             1081          (l) cost containment strategies for health care, including durable medical equipment
             1082      and home health care cost containment strategies;
             1083          (m) analysis of cost effective bariatric surgery coverage; and
             1084          (n) Medicaid behavioral and mental health delivery and payment reform models,
             1085      including:
             1086          (i) identifying and eliminating barriers to the delivery of effective mental, behavioral,
             1087      and physical health care delivery systems;
             1088          (ii) the costs and financing of mental and behavioral health care, including current cost
             1089      drivers, cost shifting, cost containment measures, and the roles of local government programs,
             1090      state government programs, and federal government programs; and
             1091          (iii) innovative service delivery models that facilitate access to quality, cost effective
             1092      and coordinated mental, behavioral, and physical health care.
             1093          (2) A final report, including any proposed legislation shall be presented to the Health
             1094      and Human Services and Business and Labor Interim Committees before November 30, 2012.
             1095          Section 18. Appropriation.
             1096          Under the terms and conditions of Title 63J, Chapter 1, Budgetary Procedures Act, the
             1097      following sums of money are appropriated from resources not otherwise appropriated, or
             1098      reduced from amounts previously appropriated, out of the funds or accounts indicated for the
             1099      fiscal year beginning July 1, 2011 and ending June 30, 2012. These are additions to any
             1100      amounts previously appropriated for fiscal year 2012.
             1101          To Legislature - Senate
             1102              From General Fund, One-time                    $15,000
             1103              Schedule of Programs:
             1104                  Administration            $15,000
             1105          To Legislature - House of Representatives
             1106              From General Fund, One-time                    $25,000
             1107              Schedule of Programs:
             1108                  Administration            $25,000
             1109          Section 19. Repeal date.
             1110          The Health System Reform Task Force is repealed December 31, 2012.


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