HOUSE BILL No. 5548


     December 21, 2001, Introduced by Reps. Hardman, Garza, Reeves, Daniels, Kolb, Lockwood, Tabor, Vander Roest, Bogardus, Waters, Hale,
Gieleghem, McConico, Quarles, Rivet, O'Neil, Plakas, Murphy, Schauer, Phillips and Lemmons and referred to the Committee on Health Policy.


        A bill to amend 1956 PA 218, entitled

   "The insurance code of 1956,"

   by amending sections 2243, 3405, 3631, and 3709 (MCL 500.2243,

   500.3405, 500.3631, and 500.3709), as amended by 1994 PA 438; and

   to repeal acts and parts of acts.

               THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 1
           Sec. 2243.  (1) Notwithstanding any provision of a policy or

 2
      contract of group accident, group health, or group accident and

 3
      health insurance, executed after July 23, 1965, if the policy or

 4
      contract provides for reimbursement for any optometric service

 5
      that is within the lawful scope of practice of a duly licensed

 6
      optometrist, a subscriber to such group accident, group health,

 7
      or group accident and group health insurance policy or contract

 8
      shall be entitled to reimbursement for such service, whether the

 9
      service is performed by a physician or a duly licensed


   04169'01 **                                              DKH                                   2

 1
      optometrist.  Unless the policy or contract of group accident,

 2
      group health, or group accident and health insurance otherwise

 3
      provides, there shall be no reimbursement for ophthalmic materi-

 4
      als, lenses, spectacles, eyeglasses, or appurtenances.

 5
           (2) If a subscriber contract provides for and offers opto-

 6
      metric services, the subscriber shall have freedom of choice to

 7
      select either a physician or an optometrist to render the

 8
      services.  Unless the subscriber contract otherwise provides,

 9
      there shall be no reimbursement for ophthalmic materials, lenses,

10
      spectacles, eyeglasses, or appurtenances.

11
            (3) This section does not require coverage or reimbursement

12
      for a practice of optometric service unless that service was

13
      included in the definition of practice of optometry under

14
      section 17401 of the public health code, Act No. 368 of the

15
      Public Acts of 1978, being section 333.17401 of the Michigan

16
      Compiled Laws, as of May 20, 1992.

17
           Sec. 3405.  (1) For the purpose of doing business as an

18
      organization under the prudent purchaser act,  Act No. 233 of the

19
      Public Acts of 1984, being sections 550.51 to 550.63 of the

20
      Michigan Compiled Laws  1984 PA 233, MCL 550.51 TO 550.63, an

21
      insurer authorized in this state to write disability insurance

22
      that provides coverage for hospital, nursing, medical, surgical,

23
      or sick-care benefits may enter into prudent purchaser agreements

24
      with providers of hospital, nursing, medical, surgical, or

25
      sick-care services pursuant to this section and  Act No. 233 of

26
      the Public Acts of 1984  THE PRUDENT PURCHASER ACT, 1984 PA 233,

27
      MCL 550.51 TO 550.63.



   04169'01 **                                   3

 1
           (2) An insurer may offer disability insurance policies under

 2
      which the insured persons shall be required, as a condition of

 3
      coverage, to obtain hospital, nursing, medical, surgical, or

 4
      sick-care services exclusively from health care providers who

 5
      have entered into prudent purchaser agreements.  A person to whom

 6
      such a policy is offered shall also be offered a policy that:

 7
           (a) Does not, as a condition of coverage, require insured

 8
      persons to obtain services exclusively from health care providers

 9
      who have entered into prudent purchaser agreements.

10
           (b) Does not give a financial advantage or other advantage

11
      to an insured person who elects to obtain services from health

12
      care providers who have entered into prudent purchaser

13
      agreements.

14
           (3) An insurer may offer disability insurance policies under

15
      which insured persons who elect to obtain hospital, nursing, med-

16
      ical, surgical, or sick-care services from health care providers

17
      who have entered into prudent purchaser agreements shall realize

18
      a financial advantage or other advantage by selecting  such

19
      THOSE providers.  Policies offered pursuant to this subsection

20
      shall not, as a condition of coverage, require insured persons to

21
      obtain  such  services exclusively from health care providers who

22
      have entered into prudent purchaser agreements.  A person to whom

23
      such a policy is offered shall also be offered a policy that:

24
           (a) Does not, as a condition of coverage, require insured

25
      persons to obtain services exclusively from health care providers

26
      who have entered into prudent purchaser agreements.





   04169'01 **                                   4

 1
           (b) Does not give a financial advantage or other advantage

 2
      to an insured person who elects to obtain services from health

 3
      care providers who have entered into prudent purchaser

 4
      agreements.

 5
           (4) The rates charged by an insurer for coverage under poli-

 6
      cies issued under this section shall not be unreasonably lower

 7
      than what is necessary to meet the expenses of the insurer for

 8
      providing this coverage and shall not have an anticompetitive

 9
      effect or result in predatory pricing in relation to prudent pur-

10
      chaser agreement coverages offered by other organizations.

11
           (5) An insurer shall not discriminate against a class of

12
      health care providers when entering into prudent purchaser agree-

13
      ments with health care providers for its provider panel.  This

14
      subsection does not:

15
           (a) Prohibit the formation of a provider panel consisting of

16
      a single class of providers when a service provided for in the

17
      specifications of a purchaser may legally be provided only by a

18
      single class of providers.

19
           (b) Prohibit the formation of a provider panel that conforms

20
      to the specifications of a purchaser of the coverage authorized

21
      by this section so long as the specifications do not exclude any

22
      class of health care providers who may legally perform the serv-

23
      ices included in the coverage.

24
           (c) Require an organization that has uniformly applied the

25
      standards filed pursuant to section 3(3) of  Act No. 233 of the

26
      Public Acts of 1984, being section 550.53 of the Michigan





   04169'01 **                                   5

 1
      Compiled Laws  THE PRUDENT PURCHASER ACT, 1984 PA 233, MCL

 2
      550.53, to contract with any individual provider.

 3
           (6) Nothing in  this  THE 1984 amendatory act THAT ADDED

 4
      THIS SUBSECTION applies to any contract that is in existence

 5
      before December 20, 1984, or the renewal of  such  THAT

 6
      contract.

 7
            (7) Notwithstanding any other provision of this act, if

 8
      coverage under a prudent purchaser agreement provides for bene-

 9
      fits for services that are within the scope of practice of optom-

10
      etry, an insurer is not required to provide coverage or reimburse

11
      for a practice of optometric service unless that service was

12
      included in the definition of practice of optometry under

13
      section 17401 of the public health code, Act No. 368 of the

14
      Public Acts of 1978, being section 333.17401 of the Michigan

15
      Compiled Laws, as of May 20, 1992.

16
           (7)  (8)  Notwithstanding any other provision of this act,

17
      if coverage under a prudent purchaser agreement provides for ben-

18
      efits for services that are within the scope of practice of chi-

19
      ropractic, an insurer is not required to provide coverage or

20
      reimburse for the use of therapeutic sound or electricity, or

21
      both, for the reduction or correction of spinal subluxations in a

22
      chiropractic service.  This subsection shall not take effect

23
      unless Senate Bill No. 493 of the 87th Legislature is enacted

24
      into law.

25
           Sec. 3631.  (1) For the purpose of doing business as an

26
      organization under the prudent purchaser act,  Act No. 233 of the

27
      Public Acts of 1984, being sections 550.51 to 550.63 of the



   04169'01 **                                   6

 1
      Michigan Compiled Laws  1984 PA 233, MCL 550.51 TO 550.63, an

 2
      insurer authorized to write group disability insurance or family

 3
      expense insurance that provides coverage for hospital, nursing,

 4
      medical, surgical, or sick-care benefits may enter into prudent

 5
      purchaser agreements with providers of hospital, nursing, medi-

 6
      cal, surgical, or sick-care services pursuant to this section and

 7
       Act No. 233 of the Public Acts of 1984  THE PRUDENT PURCHASER

 8
      ACT, 1984 PA 233, MCL 550.51 TO 550.63.

 9
           (2) An insurer may offer group disability insurance policies

10
      or family expense policies under which the insured persons shall

11
      be required, as a condition of coverage, to obtain hospital,

12
      nursing, medical, surgical, or sick-care services exclusively

13
      from health care providers who have entered into prudent pur-

14
      chaser agreements.

15
           (3) An individual who is a member of a group who is offered

16
      the option of being under a policy pursuant to subsection (2)

17
      shall also be offered the option of being insured under a policy

18
      pursuant to subsection (4).  This subsection applies only if the

19
      group in which the individual is a member has 25 or more members

20
      or if the provider panel that is providing the services under the

21
      group policy is limited by the organization to a specific number

22
      pursuant to section 3(1) of  Act No. 233 of the Public Acts of

23
      1984, being section 550.53 of the Michigan Compiled Laws  THE

24
      PRUDENT PURCHASER ACT, 1984 PA 233, MCL 550.53.

25
           (4) An insurer may offer group disability insurance policies

26
      or family expense policies under which insured persons who elect

27
      to obtain hospital, nursing, medical, surgical, or sick-care



   04169'01 **                                   7

 1
      services from health care providers who have entered into prudent

 2
      purchaser agreements shall realize a financial advantage or other

 3
      advantage by selecting  such a provider  THOSE PROVIDERS.

 4
      Policies offered pursuant to this subsection shall not, as a con-

 5
      dition of coverage, require insured persons to obtain  such

 6
      services exclusively from health care providers who have entered

 7
      into prudent purchaser agreements.

 8
           (5) An individual who is a member of a group who is offered

 9
      the option of being insured under a policy pursuant to

10
      subsection (2) or (4) shall also be offered the option of being

11
      insured under a policy that:

12
           (a) Does not, as a condition of coverage, require insured

13
      persons to obtain services exclusively from health care providers

14
      who have entered into prudent purchaser agreements.

15
           (b) Does not give a financial advantage or other advantage

16
      to an insured person who elects to obtain services from health

17
      care providers who have entered into prudent purchaser

18
      agreements.

19
           (6) Subsection (5) applies only if the group in which the

20
      individual is a member has 25 or more members and if the group on

21
      December 20, 1984 had health care coverage through the group

22
      sponsor.

23
           (7) The rates charged by an insurer for coverage under poli-

24
      cies issued under this section shall not be unreasonably lower

25
      than what is necessary to meet the expenses of the insurer for

26
      providing this coverage and shall not have an anticompetitive





   04169'01 **                                   8

 1
      effect or result in predatory pricing in relation to prudent

 2
      purchaser agreement coverages offered by other organizations.

 3
           (8) An insurer shall not discriminate against a class of

 4
      health care providers when entering into prudent purchaser agree-

 5
      ments with health care providers for its provider panel.  This

 6
      subsection does not:

 7
           (a) Prohibit the formation of a provider panel consisting of

 8
      a single class of providers when a service provided for in the

 9
      specifications of a purchaser may legally be provided only by a

10
      single class of providers.

11
           (b) Prohibit the formation of a provider panel that conforms

12
      to the specifications of a purchaser of the coverage authorized

13
      by this section so long as the specifications do not exclude any

14
      class of health care providers who may legally perform the serv-

15
      ices included in the coverage.

16
           (c) Require an organization that has uniformly applied the

17
      standards filed pursuant to section 3(3) of  Act No. 233 of the

18
      Public Acts of 1984, being section 550.53 of the Michigan

19
      Compiled Laws  THE PRUDENT PURCHASER ACT, 1984 PA 233, MCL

20
      550.53, to contract with any individual provider.

21
           (9) Nothing in  this  THE 1984 amendatory act THAT ADDED

22
      THIS SUBSECTION applies to any contract that is in existence

23
      before December 20, 1984, or the renewal of  such  THAT

24
      contract.

25
            (10) Notwithstanding any other provision of this act, if

26
      coverage under a prudent purchaser agreement provides for

27
      benefits for services that are within the scope of practice of



   04169'01 **                                   9

 1
      optometry, an insurer is not required to provide coverage or

 2
      reimburse for a practice of optometric service unless that serv-

 3
      ice was included in the definition of practice of optometry under

 4
      section 17401 of the public health code, Act No. 368 of the

 5
      Public Acts of 1978, being section 333.17401 of the Michigan

 6
      Compiled Laws, as of May 20, 1992.

 7
           (10)  (11)  Notwithstanding any other provision of this act,

 8
      if coverage under a prudent purchaser agreement provides for ben-

 9
      efits for services that are within the scope of practice of chi-

10
      ropractic, an insurer is not required to provide coverage or

11
      reimburse for the use of therapeutic sound or electricity, or

12
      both, for the reduction or correction of spinal subluxations in a

13
      chiropractic service.  This subsection shall not take effect

14
      unless Senate Bill No. 493 of the 87th Legislature is enacted

15
      into law.

16
           Sec. 3709.  (1) For the purpose of doing business as an

17
      organization under the prudent purchaser act,  Act No. 233 of the

18
      Public Acts of 1984, being sections 550.51 to 550.63 of the

19
      Michigan Compiled Laws  1984 PA 233, MCL 550.51 TO 550.63, an

20
      insurer authorized under this chapter to write health insurance

21
      that provides coverage for hospital, nursing, medical, surgical,

22
      or sick-care benefits may enter into prudent purchaser agreements

23
      with providers of hospital, nursing, medical, surgical, or

24
      sick-care services pursuant to this section and  Act No. 233 of

25
      the Public Acts of 1984  THE PRUDENT PURCHASER ACT, 1984 PA 233,

26
      MCL 550.51 TO 550.63.





   04169'01 **                                  10

 1
           (2) An insurer may offer health insurance policies or family

 2
      expense policies under which the insured persons shall be

 3
      required, as a condition of coverage, to obtain hospital, nurs-

 4
      ing, medical, surgical, or sick-care services exclusively from

 5
      health care providers who have entered into prudent purchaser

 6
      agreements.

 7
           (3) An individual who is a member of a group who is offered

 8
      the option of being insured under a policy pursuant to subsection

 9
      (2) shall also be offered the option of being insured under a

10
      policy pursuant to subsection (4).  This subsection applies only

11
      if the group in which the individual is a member has 25 or more

12
      members or if the provider panel that is providing the services

13
      under the group policy is limited by the organization to a spe-

14
      cific number pursuant to section 3(1) of the  Act No. 233 of the

15
      Public Acts of 1984, being section 550.53 of the Michigan

16
      Compiled Laws  PRUDENT PURCHASER ACT, 1984 PA 233, MCL 550.53.

17
           (4) An insurer may offer health insurance policies under

18
      which insured persons who elect to obtain hospital, nursing, med-

19
      ical, surgical, or sick-care services from health care providers

20
      who have entered into prudent purchaser agreements shall realize

21
      a financial advantage or other advantage by selecting  such

22
      THOSE providers.  Policies offered pursuant to this subsection

23
      shall not, as a condition of coverage, require insured persons to

24
      obtain services exclusively from health care providers who have

25
      entered into prudent purchaser agreements.

26
           (5) An individual who is a member of a group who is offered

27
      the option of being insured under a policy pursuant to subsection



   04169'01 **                                  11

 1
      (2) or (4) shall also be offered the option of being insured

 2
      under a policy that:

 3
           (a) Does not, as a condition of coverage, require insured

 4
      persons to obtain services exclusively from health care providers

 5
      who have entered into prudent purchaser agreements.

 6
           (b) Does not give a financial advantage or other advantage

 7
      to an insured person who elects to obtain services from health

 8
      care providers who have entered into prudent purchaser

 9
      agreements.

10
           (6) Subsection (5) applies only if the group in which the

11
      individual is a member has 25 or more members and if the group on

12
      December 20, 1984 had health care coverage through the group

13
      sponsor.

14
           (7) The rates charged by an insurer for coverage under poli-

15
      cies issued under this section shall not be unreasonably lower

16
      than what is necessary to meet the expenses of the insurer for

17
      providing this coverage and shall not have an anticompetitive

18
      effect or result in predatory pricing in relation to prudent pur-

19
      chaser agreement coverages offered by other organizations.

20
           (8) An insurer shall not discriminate against a class of

21
      health care providers when entering into prudent purchaser agree-

22
      ments with health care providers for its provider panel.  This

23
      subsection does not:

24
           (a) Prohibit the formation of a provider panel consisting of

25
      a single class of providers when a service provided for in the

26
      specifications of a purchaser may legally be provided only by a

27
      single class of providers.



   04169'01 **                                  12

 1
           (b) Prohibit the formation of a provider panel that conforms

 2
      to the specifications of a purchaser of the coverage authorized

 3
      by this section so long as the specifications do not exclude any

 4
      class of health care providers who may legally perform the serv-

 5
      ices included in the coverage.

 6
           (c) Require an organization that has uniformly applied the

 7
      standards filed pursuant to section 3(3) of  Act No. 233 of the

 8
      Public Acts of 1984, being section 550.53 of the Michigan

 9
      Compiled Laws  THE PRUDENT PURCHASER ACT, 1984 PA 233, MCL

10
      550.53, to contract with any individual provider.

11
           (9) Nothing in the 1984 amendatory act that added this sec-

12
      tion applies to any contract that is in existence before

13
      December 20, 1984, or the renewal of  such  THAT contract.

14
            (10) Notwithstanding any other provision of this act, if

15
      coverage under a prudent purchaser agreement provides for bene-

16
      fits for services that are within the scope of practice of optom-

17
      etry, an insurer is not required to provide coverage or reimburse

18
      for a practice of optometric service unless that service was

19
      included in the definition of practice of optometry under

20
      section 17401 of the public health code, Act No. 368 of the

21
      Public Acts of 1978, being section 333.17401 of the Michigan

22
      Compiled Laws, as of May 20, 1992.

23
           (10)  (11)  Notwithstanding any other provision of this act,

24
      if coverage under a prudent purchaser agreement provides for ben-

25
      efits for services that are within the scope of practice of chi-

26
      ropractic, an insurer is not required to provide coverage or

27
      reimburse for the use of therapeutic sound or electricity, or



   04169'01 **                                  13

 1
      both, for the reduction or correction of spinal subluxations in a

 2
      chiropractic service.  This subsection shall not take effect

 3
      unless Senate Bill No. 493 of the 87th Legislature is enacted

 4
      into law.

 5
           Enacting section 1.  Section 3107b of the insurance code of

 6
      1956, 1956 PA 218, MCL 500.3107b, is repealed.

 7
           Enacting section 2.  This amendatory act does not take

 8
      effect unless all of the following bills of the 91st Legislature

 9
      are enacted into law:

10
           (a) Senate Bill No. _____ or House Bill No. 5550 (request

11
      no. 04170'01 **).

12
           (b) Senate Bill No. _____ or House Bill No. 5551 (request

13
      no. 04171'01 **).

14
           (c) Senate Bill No. _____ or House Bill No. 5549 (request

15
      no. 04172'01 **).



























   04169'01 **          Final page.                         DKH