HB-4576, As Passed House, December 18, 2014HB-4576, As Passed Senate, December 18, 2014

 

 

 

 

 

 

 

 

 

 

SENATE SUBSTITUTE FOR

 

HOUSE BILL NO. 4576

 

 

 

 

 

 

 

 

 

 

 

     A bill to amend 1956 PA 218, entitled

 

"The insurance code of 1956,"

 

by amending section 102 (MCL 500.102), as amended by 2000 PA 252,

 

and by adding chapter 12A.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 102. (1) "Commissioner" as As used in this act:

 

     (a) "Commissioner" means the commissioner of the office of

 

financial and insurance services.director.

 

     (b) (2) "Department" as used in this act means the office of

 

financial and insurance services.department of insurance and

 

financial services.

 

     (c) "Director" means, unless the context clearly implies a

 

different meaning, the director of the department.

 

CHAPTER 12A

 

     Sec. 1261. As used in this chapter:


House Bill No. 4576 (S-2) as amended December 17, 2014

 

     (a) "Affordable care act" means the patient protection and

 

affordable care act, Public Law 111-148, as amended by the health

 

care and education reconciliation act of 2010, Public Law 111-152.

 

     (b) "Business entity" means a corporation, association,

 

partnership, limited liability company, limited liability

 

partnership, or other legal entity.

 

     (c) "Certificate" means a document issued by the director

 

authorizing a person to act as a navigator or certified application

 

counselor for the qualifications specified in the document. The

 

certificate itself does not create any actual, apparent, or

 

inherent authority in the certificate holder to represent or commit

 

an insurer.

 

     (d) "Certificate holder" means a person issued a certificate

 

under this chapter.

 

     (e) "Certified application counselor" means an individual who

 

is certified [as a certified application counselor] under this chapter

 and is authorized by the United

 

States department of health and human services to perform the

 

duties described in 45 CFR 155.225.

[(f) "Certified navigator" means a person that is certified as a navigator under this chapter.

     (G)] "Exchange" means an American health benefits exchange

 

established or operating under the affordable care act.

 

     [(h)] "Insurance" means any of the kinds of insurance described

 

in chapter 6.

 

     [(I)] "Insurance producer" means a person required to be

 

licensed under the laws of this state to sell, solicit, or

 

negotiate insurance.

 

     [(J)] "Navigator" means a person that receives any funding from

 

an exchange or the federal government and is designated or selected


House Bill No. 4576 (S-2) as amended December 17, 2014

 

by an exchange or the federal government to perform any of the

 

duties described in 42 USC 18031(i)(3).

 

     [(K)] "Negotiate" means the act of conferring directly with or

 

offering advice directly to a purchaser or prospective purchaser of

 

a particular contract of insurance concerning any of the

 

substantive benefits, terms, or conditions of the contract,

 

provided that the person engaged in that act either sells insurance

 

or obtains insurance from insurers for purchasers.

 

     [(l)] "Qualified health plan" means that term as defined in

 

section 1301 of the affordable care act.

 

     [(m)] "Sell" means to exchange a contract of insurance by any

 

means, for money or its equivalent, on behalf of an insurance

 

company.

 

     [(n)] "Solicit" means attempting to sell insurance or asking or

 

urging a person to apply for a particular kind of insurance from a

 

particular company.

 

     Sec. 1262. (1) [Beginning June 30, 2015, an] individual shall not

 act as a navigator [  

 

                               ] unless he or she has filed an

 

application under section [1263(1)] and is certified with this state as

 

a navigator [.                                                  ]

 

     (2) Unless certified [as a navigator], an individual shall not

receive funding

 

from an exchange.

 

     (3) Subject to the affordable care act, a [certified navigator]

 

shall do all of the following:

 

     (a) Conduct public education activities to raise awareness of

 

the availability of qualified health plans.

 

     (b) Distribute fair and impartial information concerning


House Bill No. 4576 (S-2) as amended December 17, 2014

 

enrollment in all qualified health plans offered within the

 

exchange and the availability of the premium tax credits under

 

section 36B of the internal revenue code of 1986, 26 USC 36B, and

 

cost-sharing reduction under section 1402 of the affordable care

 

act.

 

     (c) Facilitate selection of a qualified health plan.

 

     (d) Provide referrals to appropriate state agencies for an

 

enrollee with a grievance, complaint, or question regarding the

 

enrollee's health plan, coverage, or a determination under such

 

plan coverage.

 

     (e) Provide information in a manner that is culturally and

 

linguistically appropriate to the needs of the population served by

 

the exchange.

 

     (4) A [certified navigator] shall not do any of the following:

 

     (a) Sell, solicit, or negotiate health insurance.

 

     (b) Recommend a particular health benefit plan.

 

     (c) Provide any information or services related to insurance

 

regulated under this act other than health benefit plans or other

 

products offered in the exchange.

 

     (5) If an exchange is operational in this state, the director

 

shall determine whether a program to certify and train navigators

 

[                                        ] protects the privacy and

 

security of personally identifiable information of the residents of

 

this state under the laws of this state. If the director determines

 

that the program does not protect the residents of this state under

 

this subsection, the director shall do all of the following:

 

     (a) Establish a certification and training program that must


 

include, but is not limited to, all of the following:

 

     (i) A criminal history check using the department of state

 

police's internet criminal history access tool (ICHAT).

 

     (ii) Training on privacy and security of personal identifying

 

information, training on ethics, training on provisions of the

 

affordable care act relating to navigators and certified

 

application counselors and any necessary state-specific training as

 

determined by the director.

 

     (b) Develop an application and disclosure form by which an

 

applicant for a certificate shall disclose any potential conflicts

 

of interest, as well as any other information required by the

 

director.

 

     (c) Submit an annual report to the standing committees of the

 

senate and house of representatives with jurisdiction over health

 

policy. The report must include all of the following:

 

     (i) The director's assessment of any federal program to certify

 

and train navigators and certified application counselors.

 

     (ii) Any changes implemented by the department as a result of a

 

federal program to train navigators and certified application

 

counselors.

     [Sec. 1262a. (1) An individual shall not act as a certified application counselor unless he or she has filed an application under section 1263(2) and is certified with this state as a certified application counselor.

     (2) Unless certified as a certified application counselor, an individual shall not receive funding from an exchange.

     (3) Subject to the affordable care act, a certified application counselor may do all of the following:

     (a) Conduct public education activities to raise awareness of the availability of qualified health plans.

     (b) Distribute fair and impartial information about all qualified health plans offered within the exchange and the availability of the premium tax credits under section 36B of the internal revenue code of 1986, 26 USC 36B, and cost-sharing reduction under section 1402 of the affordable care act.

     (c) Assist individuals applying for coverage in a qualified health plan.

     (d) Facilitate selection of eligible individuals in a qualified health plan.

     (e) Provide information in a manner that is culturally and linguistically appropriate to the needs of the population served by the exchange.

     (f) Refer an individual with limited English proficiency to a navigator, insurance producer, or other source of assistance.

     (4) A certified application counselor shall not do any of the following:

     (a) Sell, solicit, or negotiate health insurance.

     (b) Recommend a particular qualified health benefit plan.

     (c) Provide any information or services related to insurance regulated under this act other than qualified health benefit plans or other products offered in the exchange.

     (5) Before providing services to or acting for an individual under subsection (3), a certified application counselor shall disclose any potential conflict of interest to the individual.]

     Sec. 1263. (1) An individual applying for a [navigator] certificate

shall

 

file with the director the uniform application required by the

 

director and shall declare under penalty of refusal, suspension, or

 

revocation of the [navigator] certificate that the statements made in the

 

application are true, correct, and complete to the best of the

 

individual's knowledge and belief. An application for a [navigator]

certificate

 

shall not be approved unless the director finds that the individual


House Bill No. 4576 (S-2) as amended December 17, 2014

meets all of the following criteria:

     (a) Is at least 18 years of age.

     (b) Has not committed an act listed that would be a ground for

denial, suspension, or revocation of an insurance producer's

license in section 1239(1).

     (c) Has completed all required training courses under section

1262.

     (d) Has paid the fees required by the director.

     (e) Has successfully passed any required examination.

     (f) Has successfully completed a criminal history check under

section 1262.

     [(2) An individual applying for a certified application counselor certificate shall file with the director the uniform application required by the director and shall declare under penalty of refusal, suspension, or revocation of the certified application counselor certificate that the statements made in the application are true, correct, and complete to the best of the individual's knowledge and belief. An application for a certified application counselor certificate shall not be approved unless the director finds that the individual meets all of the following criteria:

     (a) Is at least 18 years of age.

     (b) Has not committed an act listed that would be a ground for denial, suspension, or revocation of an insurance producer's license in section 1239(1).

     (c) Has completed the entire United States department of health and human services training for certified application counselors, has successfully completed all testing, and has received certification as a certified application counselor from the federal government.

     (d) Has paid the fees required by the director.

     (e) Has successfully completed a criminal history check using the department of state police's internet criminal history access tool (ICHAT).

     (3) If the United States department of health and human services discontinues the training and testing program for certified application counselors, the director shall create a training and testing program for certified application counselors regarding qualified health plan options, insurance affordability programs, eligibility, and benefit rules, and regulations governing all insurance affordability programs operated in this state.

     (4)] A business entity acting as a navigator or certified

application counselor shall obtain a certificate. A business entity

applying for a certificate shall file with the director the uniform

business entity application required by the director. An

application for a certificate under this subsection shall not be

approved unless the director finds that the business entity meets

all of the following:

     (a) The business entity has paid the fees required by the

director.

     (b) The business entity has designated an individual

certificate holder responsible for the business entity's compliance

with this chapter.

     (c) The business entity has not committed an act listed in

section 1239(1).

     [(5)] The director may require the production of any documents

reasonably necessary to verify the information contained in an


 

application.

 

     Sec. 1264. (1) In addition to any other powers under this act,

 

the director may place on probation, suspend, or revoke a

 

certificate or may levy a civil fine under section 1270 or any

 

combination of actions, and the director shall refuse to issue a

 

certificate under section 1263, for any 1 or more causes that would

 

be a ground for refusal, suspension, or revocation of an insurance

 

producer's license under section 1239. The director may revoke a

 

certificate of a person or refuse to issue a certificate for a

 

person that receives financial compensation, including monetary and

 

in-kind compensation, gifts, or any compensation related to

 

enrollment from an insurer offering qualified health benefits

 

through an exchange operating in this state. The director may deny,

 

suspend, approve, renew, or revoke a certificate if the director

 

considers it necessary to protect insureds and the public.

 

     (2) The certificate of a business entity may be suspended,

 

revoked, or refused if the director finds, after hearing, that an

 

individual certificate holder's violation was known or should have

 

been known by 1 or more of the partners, officers, or managers

 

acting on behalf of the business entity and the violation was

 

neither reported to the director nor corrective action taken.

 

     (3) The director may examine the books and records of a

 

certificate holder to determine whether the certificate holder is

 

conducting its business in accordance with this chapter. For the

 

purpose of facilitating the examination, the certificate holder

 

shall allow the director free access, at reasonable times, to all

 

of the certificate holder's books and records relating to


 

transactions to which this chapter applies.

 

     Sec. 1265. A business entity issued a certificate shall, in a

 

manner prescribed by the director, make available a list of all

 

individual certificate holders that the business entity employs or

 

supervises or with which the business entity is otherwise

 

affiliated.

 

     Sec. 1266. A business entity that terminates the employment,

 

engagement, affiliation, or other relationship with an individual

 

certificate holder shall notify the director using a format

 

prescribed by the director of the termination within 30 days

 

following the effective date of the termination if the reason for

 

termination is 1 of the reasons listed in section 1239(1) or the

 

business entity has knowledge the individual was found by a court

 

or government body to have engaged in any of the activities listed

 

in section 1239(1).

 

     Sec. 1268. (1) When applying for a certificate, the applicant

 

shall report his or her mailing and electronic mail address to the

 

director. A certificate holder shall notify the director of a

 

change in his or her mailing or electronic mail address within 30

 

days after the change. The director shall maintain the mailing and

 

electronic mail address of each certificate holder on file.

 

     (2) A notice of hearing or service of process may be served

 

upon a certificate holder in an action or proceeding for a

 

violation of this act by mailing the notice or process by first-

 

class mail to the certificate holder's mailing address reported to

 

the director under subsection (1).

 

     Sec. 1269. (1) The director shall refuse to grant a


 

certificate to an applicant who fails to meet the requirements of

 

this chapter. Notice of the refusal shall be in writing and shall

 

set forth the basis for the refusal. If the applicant submits a

 

written request within 30 days after mailing of the notice of

 

refusal, the director shall promptly conduct a hearing in which the

 

applicant shall be given an opportunity to show compliance with the

 

requirements of this chapter.

 

     (2) The director, after notice of and opportunity for a

 

hearing, may suspend or revoke a certificate of a certificate

 

holder who fails to maintain the standards required for initial

 

certification or who violates this act.

 

     (3) Without prior hearing, the director may order summary

 

suspension of a certificate if he or she finds that protection of

 

the public requires emergency action and incorporates this finding

 

in his or her order. The suspension shall be effective on the date

 

specified in the order or upon service of a certified copy of the

 

order on the certificate holder, whichever is later. If requested,

 

the director shall conduct a hearing on the suspension within a

 

reasonable time but not later than 20 days after the effective date

 

of the summary suspension unless the person whose certificate is

 

suspended requests a later date. At the hearing, the director shall

 

determine if the suspension should be continued or if the

 

suspension should be withdrawn, and, if proper notice is given, may

 

determine if the certificate should be revoked. The director shall

 

announce his or her decision within 30 days after conclusion of the

 

hearing. The suspension shall continue until the decision is

 

announced.


 

     (4) The director, or his or her designated deputy, may issue

 

subpoenas to require the attendance and testimony of witnesses and

 

the production of documents necessary to the conduct of the hearing

 

and may designate a department employee to make service. The

 

subpoenas issued by the director, or his or her designated deputy,

 

may be enforced upon petition to the circuit court of Ingham county

 

to show cause why a contempt order should not be issued, as

 

provided by law.

 

     Sec. 1270. (1) If the director finds that a person has

 

violated this chapter, after an opportunity for a hearing under the

 

administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to

 

24.328, the director shall reduce the findings and decision to

 

writing and shall issue and cause to be served upon the person

 

charged with the violation a copy of the findings and an order

 

requiring the person to cease and desist from the violation. In

 

addition, the director may order any of the following:

 

     (a) Payment of a civil fine of not more than $500.00 for each

 

violation. However, if the person knew or reasonably should have

 

known that he or she was in violation of this chapter, the director

 

may order the payment of a civil fine of not more than $2,500.00

 

for each violation. An order of the director under this subsection

 

shall not require the payment of civil fines exceeding $25,000.00.

 

A fine collected under this subdivision shall be turned over to the

 

state treasurer and credited to the general fund of this state.

 

     (b) The suspension or revocation of the certificate.

 

     (2) The director may by order, after notice and opportunity

 

for hearing, reopen and alter, modify, or set aside, in whole or in


 

part, an order issued under this section, if in the opinion of the

 

director conditions of fact or of law have changed to require that

 

action, or if the public interest requires that action.

 

     (3) If a person knowingly violates a cease and desist order

 

under this chapter and has been given notice and an opportunity for

 

a hearing held under the administrative procedures act of 1969,

 

1969 PA 306, MCL 24.201 to 24.328, the director may order a civil

 

fine of not more than $10,000.00 for each violation, or a

 

suspension or revocation of the certificate, or both. An order

 

issued by the director under this subsection shall not require the

 

payment of civil fines exceeding $50,000.00. A fine collected under

 

this subsection shall be turned over to the state treasurer and

 

credited to the general fund of this state.

 

     (4) The director may apply to the circuit court of Ingham

 

county for an order of the court enjoining a violation of this

 

chapter.

 

     Sec. 1271. The director shall develop and implement a process

 

for receipt, investigation, and referral to a federal exchange of

 

citizen complaints regarding navigators and certified application

 

counselors. The director shall submit an annual report that

 

describes this process to the standing committees of the senate and

 

house of representatives with jurisdiction of health policy.

 

     Sec. 1272. This chapter does not authorize or shall not be

 

construed to authorize the establishment or operation of an

 

American health benefit exchange in this state under the affordable

 

care act.

 

     Enacting section 1. (1) This amendatory act shall not be


 

construed to do any of the following:

 

     (a) Authorize this state or an agency of this state to conduct

 

or oversee state-level governmental consumer assistance functions

 

for an American health benefit exchange established or operating in

 

this state under the patient protection and affordable care act,

 

Public Law 111-148, as amended by the health care and education

 

reconciliation act of 2010, Public Law 111-152.

 

     (b) Convey any administrative, statutory, rule-making, or

 

other power to this state or an agency of this state to authorize,

 

establish, or operate an American health benefit exchange in this

 

state that did not exist before the effective date of this

 

amendatory act.

 

     (2) It is the intent of this legislature that any consumer

 

assistance functions by or overseen by this state or an agency of

 

this state with regard to an American health benefit exchange shall

 

be conducted in a manner that utilizes and highlights Michigan-

 

based resources, including insurance producers, in order to best

 

serve the residents of this state and to ensure appropriate health

 

care decisions.

 

     Enacting section 2. This amendatory act applies to policies,

 

certificates, or contracts delivered, issued for delivery, or

 

renewed in this state on and after the effective date of this

 

amendatory act.