Rule-Making Notices (Hearing Notices)

Summary of factual data and analytical methodologies

OCI surveyed insurers doing business in Wisconsin regarding coverage of screening tests and procedures for colorectal cancer and found that of the insurers surveyed, all insurers currently provide coverage for some form of colorectal cancer screening.

As to guidelines, OCI consulted with the department of health services, representatives and discussed the proposed rule with interested parties including the American Cancer Society, Wisconsin Radiological Society, Wisconsin Association of Health Plans and numerous providers. The guidelines utilized in the rule include not only the American Cancer Society but also National Cancer Institute and the U.S. Preventive Services Task Force.

Analysis and supporting documents used to determine effect on small business

There are no insurers that offer comprehensive health insurance that qualify as small businesses in accordance with s. 227.114 (1), Wis. Stat. Intermediaries that solicit individual health insurance will be required to use the new form but since it is available at no cost from the office, the effect will be minimal.

Effect on Small Business

This rule will require intermediaries to learn about the colorectal cancer benefit but will not have a fiscal impact.

Initial regulatory flexibility analysis

Notice is hereby further given that pursuant to s. 227.114, Stats., the proposed rule may have an effect on small businesses. The initial regulatory flexibility analysis is as follows:

a. Types of small businesses affected:

  Insurance agents, LSHO, Town Mutuals, Small Insurers.

b. Description of reporting and bookkeeping procedures required:

  Adds the option of electronically filing forms to the OCI and requires attestation of the Flesch score and tool used to determine the Flesch score. No other bookkeeping or reporting requirements other than are currently required.

c. Description of professional skills required:

  Some small businesses, not otherwise exempted by rule, will need to update the website to include information on how to request or access the insured's policy. Other than creating the notice, no other professional skills other than are currently required.

Small business regulatory coordinator

The OCI small business coordinator is Eileen Mallow and may be reached at phone number [phone] or at email address [e-mail].

Fiscal Estimate

There will be no state or local government effect.

Private sector fiscal effect

There will be no significant fiscal effect on the private sector as the proposed rules add a benefit for consumers with little additional cost since most if not all insurers and self-funded governmental plans currently provide coverage.

Agency Contact Person

A copy of the full text of the proposed rule changes, analysis and fiscal estimate may be obtained from the Web site at: http://oci.wi.gov/ocirules.htm or by contacting Inger Williams, OCI Services Section, at:

Phone: [phone]

Email: [e-mail]

Address: 125 South Webster St – 2nd Floor, Madison WI

Mail: PO Box 7873, Madison, WI 53707-7873

Notice of Hearing

Insurance

rulemaking_notices CR 10-150 CR 10-150, EmR1043

NOTICE IS HEREBY GIVEN that pursuant to the authority granted under section 601.41 (3), Stats., and the procedures set forth in under sections 227.18 and 227.24 (4), Stat., OCI will hold a public hearing to consider the emergency rule and the adoption of the attached proposed permanent rulemaking order affecting sections Ins 3.37 and 3.375, Wis. Adm. Code, relating to health insurance coverage of nervous and mental disorders and substance use disorders and affecting small business.

Hearing Information

Date and Time:	Location:
January 27, 2011 Thursday 1:00 pm	OCI 2nd Floor, Room 227 125 S. Webster St. Madison, WI 53703

Submittal of Written Comments

Written comments can be mailed to:

  Julie E. Walsh

  Legal Unit - OCI Rule Comment for Rule Ins 3375

  Office of the Commissioner of Insurance

  PO Box 7873

  Madison WI 53707-7873

Written comments can be hand delivered to:

  Julie E. Walsh

  Legal Unit - OCI Rule Comment for Rule Ins 3375

  Office of the Commissioner of Insurance

  125 South Webster St – 2nd Floor

  Madison WI 53703-3474

Comments can be emailed to:

  Julie E. Walsh

  [e-mail]

Comments submitted through the Wisconsin Administrative Rule Web site at: http://adminrules.wisconsin.gov on the proposed rule will be considered.

The deadline for submitting comments is 4:00 p.m. on the 10th day after the date for the hearing stated in this Notice of Hearing.

Copies of Proposed Rule

A copy of the full text of the proposed rule changes, analysis and fiscal estimate may be obtained from the OCI internet Web site at http://oci.wi.gov/ocirules.htm or by contacting Inger Williams, Public Information and Communications, OCI, at: [e-mail], [phone], 125 South Webster Street – 2nd Floor, Madison WI or PO Box 7873, Madison WI 53707-7873.

Analysis Prepared by the Office fo the Commissioner of Insurance (OCI)

Statute(s) interpreted

Sections 600.01, 628.34 (12), and 632.89, Stats.

Statutory authority

Sections 600.01 (2), 601.41 (3), 601.42, 628.34 (12), and 632.89, Stats.

Explanation of agency authority

The commissioner is required to promulgate rules to implement recreated s. 632.89, Stats., pursuant to s. 632.89 (4) (b), Stats., ensuring that insurers offering group health benefit plans and self-funded governmental plans include as a covered benefit the treatment of nervous and mental disorders and substance use disorders. In addition s. 632.89 (4) (a), Stats., requires the commissioner to promulgate rules relating to transitional treatment.

Related statute(s) or rule(s)

Section 609.71, Stats., was also created by 2009 Wis. Act 218 requiring defined health plans comply with the requirements contained in s. 632.89 and s. Ins 3.37, Wis. Admin. Code describe coverage for transitional treatment as required by s. 632.89 (4) (a), Stats.

Plain language analysis

The proposed rule implements the recreated s. 632.89, Stats., instituting mental health parity in the treatment of nervous and mental disorders and substance use disorders. The proposed rule amends regulations relating to transitional treatment coverage and creates a new section for implementing requirements for the coverage of nervous and mental disorders and substance use disorders.

The transitional treatment regulation is bifurcated into requirements for plans issued on or after November 1, 2007 and prior to December 1, 2010 and parallel numbered sections for polices issued on or after December 1, 2010. For existing policies or policies for which an employer has requested an exemption pursuant to s. 632.89 (3c) or (3f), Stats., the requirements reflect s. 632.89, 2007 Stats., and updated cites and provisions of regulations contained in the department of health services pertaining to transitional treatment.

For plans issued on or after December 1, 2010, parallel requirements are created within the proposed revisions to s. Ins 3.37 to apply to insurers offering group health insurance plans and for self-insured governmental plans on a going forward basis. The types of services are the same except for removal of minimum dollar limitations and the types of insurers or self-insured governmental plans to which the requirements apply.

Concerns were raised regarding compliance with the PPACA requirement of no annual limits for essential benefits and s. 632.89 (2), 2007 Stat., benefit levels. The concerns were silenced after identifying that the s. 632.89 (2), 2007 Stat., are written as “not less than" so act as benefit floors and do not preclude exceeding the floor amount therefore not volatile of the federal law.

The proposed rule also creates s. Ins 3.375, Wis. Adm. Code, to implement s. 632.89, Stats., for policies issued on or after December 1, 2010, that requires insurers offering group health insurance and self-insured governmental plans to provide coverage for the treatment of nervous and mental disorders and substance use disorders no more restrictively than coverage for the most common or frequent type of treatment limitations that are applied to substantially all other coverage under the plan. This means insurers and self-insured governmental plans cannot impose limited benefits or impose different cost-sharing provisions based upon receiving nervous, mental or substance use disorders treatment. The rule defines “substantially all" to mean that the terms of coverage for nervous, mental and substance use disorders is to be treated no more restrictively than a single type of financial requirements or quantitative treatment limitations that apply to two-thirds of covered medical or surgical benefits.

Pursuant to s. 632.89 (3c), Stats., for employers seeking an exemption based upon increased costs related to the parity requirements, employers may request insurers to have a qualified actuary determine, at the insurer's cost, whether the employer is eligible for the exemption. Nothing in the rule, however, limits or prohibits an employer or self-funded governmental plan from obtaining, at their cost, a qualified actuarial determination.

Proposed s. Ins 3.375 (5), contains provisions governing insurers offering individual health benefit plans that contain benefits for the treatment of nervous and mental disorders or substance use disorders. Insurers offering these individual health benefit plans shall make available the criteria for determining medical necessity and if the individual health benefit plan denies benefits related to nervous and mental disorders or substance use disorders it shall make the reason for the denial available to the insured, participant, or beneficiary in addition to complying with s. 632.857, Stats.

For eligible employers electing an exemption, Appendix 1 and 2 contain the model notices that insurers are to provide to employers or self-insured governmental plans that the employer is to post and distribute to employees explaining the basis of the exemption as well as a list of the benefits that will be provided to the employees as was contained in s. 632.89, 2007 Stats.

Summary of, and comparison with, existing or proposed federal regulations

The Mental Health Parity and Addiction Equity Act of 2008 (“MHPAEA"), was effective October 1, 2009 with interim final regulations published in February 2010. Wisconsin's 2009 Wis. Act 218 paralleled many provisions of the federal law in the statute and enhanced coverage benefits for Wisconsin consumers insured through small employers and covered by individual health benefit plans.

Additionally, the Patient Protection and Affordable Care Act of 2010, P.L. 111-148, as amended by the Federal Health Care and Education Reconciliation Act of 2010, P.L. 111-152 (jointly “PPACA"), identifies the treatment for mental health benefits and substance use disorders as an essential benefit that is to be contained in all health plans effective January 1, 2014. Further, as an essential benefit, as of September 23, 2010, insurers are to remove annual limits and phase out lifetime limitations over the next several years.

However, as of the date of this proposed rule, no specific federal guidance has been provided on how the MHPAEA and PPACA will be combined and what affect that combination will have on insurers and consumers. In the absence of such guidance, the commissioner's proposed rule does not interfere with an insurer's ability to comply with Wisconsin law, federal parity and federal health reform.

Comparison with rules in adjacent states

Illinois:

214 Ill. Comp. Stat. Ann 5/370c, SB 1341, and HB 2190 provide minimum mandated benefits affecting group health policies having more than 50 enrolled employees. Covered conditions include serious mental illness, including pervasive developmental disorders and post-traumatic stress disorders. Benefits include a minimum of 45 inpatient days and 35 outpatient visits benefits for serious mental illness; other mental health conditions may be subject to 50% co-pays and the lesser of the annual limit of $10,000.00 or 25% of the lifetime policy limit. Mental illness resulting from the use of controlled substances or cannabis and addictions to controlled substances and cannabis are not required to be covered.

Iowa:

Iowa code 514c.22 and HF420 provide minimum mandated benefits affecting group health policies having more than 50 enrolled employees. There is a 50-employee exemption if no coverage of mental illness is provided. Serious mental illness including pervasive developmental disorders and autistic disorders are covered; the minimum benefits include 30 inpatient days and 52 outpatient visits per plan year.

Michigan:

SB 1209/Act 252 provides a minimum mandated benefit affecting Health Maintenance Organizations (HMOs) that covers broad-based mental health disorders and substance use disorders. Minimum coverage levels include a 3% cost exemption and no fewer than 20 outpatient mental health visits per plan year.

Minnesota:

Minn. Stat. Sec. 62A.152, Minn. Stat. Sec. 62Q.47, and SB 845 provide comprehensive parity for HMOs and Community Integrated Service Networks. Benefits are mandated if offered for individual and group policies. Broad-based mental health disorders and substance use disorders are covered at minimum coverage levels.

Summary of factual data and analytical methodologies

The commissioner appointed a 20-member advisory council that met two times to discuss implementation advice to the commissioner on the parity law, content and delivery of notices to employees and components of the actuarial study. The council membership includes Sen. Hansen and Rep. Pasch, the sponsors of Wisconsin's law as well as representatives from the insurance industry, mental health and hospital providers, consumer mental health and substance use disorder advocates, large and small businesses. The commissioner's staff also met with the Department of Health Services to ensure citations and coverage description reflects current transitional treatment provisions and updated regulations. The proposed rule reflects the results of the council's deliberations and advice.

Analysis and supporting documents used to determine effect on small business

Upon review of insurers affected by the regulation, the office identified no small businesses that would be affected by the regulation.

Effect on Small Business

No significant effect will be imposed on regulated small businesses. No additional technology requirements are necessary to comply with the regulation.