Guaranteed issue
With certain specified exceptions, an insurer that has in force an individual
health benefit plan must issue an individual health benefit plan to an individual who
is a resident of this state, without regard to health condition or claims experience.
The individual must agree to pay the premium and comply with all other plan
provisions and must have been covered, within 31 days before applying for the new
coverage, under other health insurance that provided benefits similar to or
exceeding the benefits under the new coverage. An insurer is exempt from the
guaranteed issue requirement, for the remainder of a calendar year, if the insurer
fulfills certain requirements set out in the bill based on the number of individuals
covered by the insurer who fulfill the requirements necessary for guaranteed issue
in comparison to the total number of individuals covered by the insurer under all
individual health benefit plans.
Preexisting conditions, portability and other restrictions
Under the bill, an individual health benefit plan may not exclude or limit
benefits on account of a preexisting condition for more than 12 months after the
commencement of an individual's coverage and may not define a preexisting
condition more restrictively than a condition for which the individual sought or
should have sought medical care during the 18 months immediately preceding the
effective date of coverage. An individual health benefit plan may not impose a
preexisting condition limitation or exclusion relating to pregnancy as a preexisting
condition. If the individual fulfills the requirements necessary for guaranteed issue
of an individual health benefit plan, the plan must waive any period applicable to a

preexisting condition exclusion or limitation for particular services for the period
that the individual was covered for those services under his or her previous health
insurance coverage. In addition, the plan may not restrict the individual's coverage
except to the extent that the individual's coverage was restricted under the previous
health insurance coverage. The maximum lifetime benefits under the plan, however,
may be reduced by the total benefits paid under the previous health insurance
coverage.
Contract termination and renewability
Similar to the requirement for group health benefit plans, the bill requires an
insurer to renew individual health benefit plan coverage at the option of the insured
individual unless certain specified events occur, such as the individual fails to pay
premiums. The insurer may, however, discontinue offering in this state a particular
type of individual health benefit plan coverage if the insurer acts uniformly without
regard to any health status-related factor of covered individuals and offers to each
individual who has that type of coverage the option to purchase any other type of
individual health benefit plan coverage that the insurer offers. The insurer may also
discontinue offering in this state all individual health benefit plan coverage if the
insurer does not issue in this state any individual health benefit plan coverage for
5 years.
Rate regulation
Similar to the requirement for group health benefit plans, the bill requires the
commissioner to promulgate rules that establish restrictions on premium rates that
an insurer may charge for coverage under an individual health benefit plan. The
restrictions must require that the rates charged by an insurer to individuals with
similar demographic, actuarially based characteristics for the same or similar
benefit design characteristics not vary from the midpoint rate for those individuals
by more than 35% of that midpoint rate. Unlike the requirement for group health
benefit plans, the bill does not require the commissioner to establish restrictions on
increases in premium rates for individual health benefit plans.
Repeal of basic benefits plan
Under current law, a small employer may purchase a group health insurance
policy providing basic benefits for the health insurance coverage of its employes. The
small employer insurance board determines by rule most aspects of the basic benefits
policies that insurers may offer to small employers, including the basic benefits that
the policies must contain and the deductible, copayment and maximum benefit
requirements for the policies. The bill eliminates the provisions related to the basic
benefits policies, as well as the small employer insurance board.
For further information see the state and local fiscal estimate, which will be
printed as an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
SB218, s. 1
1Section 1. 15.735 (1) of the statutes is repealed.
SB218, s. 2 2Section 2. 40.51 (8) of the statutes, as affected by 1995 Wisconsin Act 289, is
3amended to read:
SB218,7,64 40.51 (8) Every health care coverage plan offered by the state under sub. (6)
5shall comply with ss. 631.89, 631.90, 631.93 (2), 632.72 (2), 632.745 (1) to (3) and (5),
6632.747,
632.87 (3) to (5), 632.895 (5m) and (8) to (10) and 632.896 and ch. 635.
SB218, s. 3 7Section 3. 40.51 (8m) of the statutes, as created by 1995 Wisconsin Act 289,
8is amended to read:
SB218,7,119 40.51 (8m) Every health care coverage plan offered by the group insurance
10board under sub. (7) shall comply with ss. 632.745 (1) to (3) and (5) and 632.747 ch.
11635
.
SB218, s. 4 12Section 4. 60.23 (25) of the statutes, as affected by 1995 Wisconsin Act 289,
13is amended to read:
SB218,7,1714 60.23 (25) Self-insured health plans. Provide health care benefits to its
15officers and employes on a self-insured basis if the self-insured plan complies with
16ss. 631.89, 631.90, 631.93 (2), 632.745 (2), (3) and (5) (a) 2. and (b) 2., 632.747 (3),
17632.87 (4) and (5), 632.895 (9) and, 632.896, 635.03 and 635.04.
SB218, s. 5 18Section 5. 66.184 of the statutes, as affected by 1995 Wisconsin Act 289, is
19amended to read:
SB218,7,25 2066.184 Self-insured health plans. If a city, including a 1st class city, or a
21village provides health care benefits under its home rule power, or if a town provides
22health care benefits, to its officers and employes on a self-insured basis, the
23self-insured plan shall comply with ss. 49.493 (3) (d), 631.89, 631.90, 631.93 (2),
24632.745 (2), (3) and (5) (a) 2. and (b) 2., 632.747 (3), 632.87 (4) and (5), 632.895 (9) and
25(10), 632.896, 635.03, 635.04, 767.25 (4m) (d) and 767.51 (3m) (d).
SB218, s. 6
1Section 6. 111.70 (1) (a) of the statutes, as affected by 1995 Wisconsin Act 289,
2is amended to read:
SB218,8,253 111.70 (1) (a) "Collective bargaining" means the performance of the mutual
4obligation of a municipal employer, through its officers and agents, and the
5representative of its municipal employes in a collective bargaining unit, to meet and
6confer at reasonable times, in good faith, with the intention of reaching an
7agreement, or to resolve questions arising under such an agreement, with respect to
8wages, hours and conditions of employment, and with respect to a requirement of the
9municipal employer for a municipal employe to perform law enforcement and fire
10fighting services under s. 61.66, except as provided in sub. (4) (m) and (n) and s. 40.81
11(3) and except that a municipal employer shall not meet and confer with respect to
12any proposal to diminish or abridge the rights guaranteed to municipal employes
13under ch. 164. The duty to bargain, however, does not compel either party to agree
14to a proposal or require the making of a concession. Collective bargaining includes
15the reduction of any agreement reached to a written and signed document. The
16municipal employer shall not be required to bargain on subjects reserved to
17management and direction of the governmental unit except insofar as the manner
18of exercise of such functions affects the wages, hours and conditions of employment
19of the municipal employes in a collective bargaining unit. In creating this subchapter
20the legislature recognizes that the municipal employer must exercise its powers and
21responsibilities to act for the government and good order of the jurisdiction which it
22serves, its commercial benefit and the health, safety and welfare of the public to
23assure orderly operations and functions within its jurisdiction, subject to those
24rights secured to municipal employes by the constitutions of this state and of the
25United States and by this subchapter.
SB218, s. 7
1Section 7. 111.70 (4) (n) of the statutes, as created by 1995 Wisconsin Act 289,
2is repealed.
SB218, s. 8 3Section 8. 111.91 (2) (k) of the statutes, as created by 1995 Wisconsin Act 289,
4is amended to read:
SB218,9,65 111.91 (2) (k) Compliance with the health benefit plan requirements under ss.
632.745 (1) to (3) and (5) and 632.747 ch. 635.
SB218, s. 9 7Section 9. 120.13 (2) (g) of the statutes, as affected by 1995 Wisconsin Act 289,
8is amended to read:
SB218,9,129 120.13 (2) (g) Every self-insured plan under par. (b) shall comply with ss.
1049.493 (3) (d), 631.89, 631.90, 631.93 (2), 632.745 (2), (3) and (5) (a) 2. and (b) 2.,
11632.747 (3),
632.87 (4) and (5), 632.895 (9) and (10), 632.896, 635.03, 635.04, 767.25
12(4m) (d) and 767.51 (3m) (d).
SB218, s. 10 13Section 10. 185.981 (4t) of the statutes, as affected by 1995 Wisconsin Act 289,
14is amended to read:
SB218,9,1715 185.981 (4t) A sickness care plan operated by a cooperative association is
16subject to ss. 252.14, 631.89, 632.72 (2), 632.745, 632.747, 632.749, 632.87 (2m), (3),
17(4) and (5), 632.895 (10) and 632.897 (10) and ch. chs. 155 and 635.
SB218, s. 11 18Section 11. 185.983 (1) (intro.) of the statutes, as affected by 1995 Wisconsin
19Act 289
, is amended to read:
SB218,9,2520 185.983 (1) (intro.) Every such voluntary nonprofit sickness care plan shall be
21exempt from chs. 600 to 646, with the exception of ss. 601.04, 601.13, 601.31, 601.41,
22601.42, 601.43, 601.44, 601.45, 611.67, 619.04, 628.34 (10), 631.89, 631.93, 632.72
23(2), 632.745, 632.747, 632.749, 632.775, 632.79, 632.795, 632.87 (2m), (3), (4) and (5),
24632.895 (5), (9) and (10), 632.896 and 632.897 (10), subch. II of ch. 619 and chs. 609,
25630, 635, 645 and 646, but the sponsoring association shall:
SB218, s. 12
1Section 12. 185.983 (1g) of the statutes is repealed.
SB218, s. 13 2Section 13. 600.01 (2) (b) of the statutes, as affected by 1995 Wisconsin Act
3289
, is amended to read:
SB218,10,54 600.01 (2) (b) Group or blanket insurance described in sub. (1) (b) 3. and 4. is
5not exempt from s. 632.745, 632.747 or 632.749 or ch. 633 or 635.
SB218, s. 14 6Section 14. 619.12 (2) (e) 1. of the statutes is renumbered 619.12 (2) (e) and
7amended to read:
SB218,10,118 619.12 (2) (e) Except as provided in subd. 2., no No person who is eligible for
9health care benefits, other than those benefits specified in s. 635.02 (14) (b) 1. to 14.,
10that are
provided by an employer on a self-insured basis or through health insurance
11is eligible for coverage under the plan.
SB218, s. 15 12Section 15. 619.12 (2) (e) 2. of the statutes is repealed.
SB218, s. 16 13Section 16. 619.12 (2) (e) 3. of the statutes is repealed.
SB218, s. 17 14Section 17. 619.123 of the statutes is repealed.
SB218, s. 18 15Section 18. 625.12 (2) of the statutes is amended to read:
SB218,10,2416 625.12 (2) Classification. Risks Subject to s. 635.09, risks may be classified
17in any reasonable way for the establishment of rates and minimum premiums,
18except that no classifications may be based on race, color, creed or national origin,
19and classifications in automobile insurance may not be based on physical condition
20or developmental disability as defined in s. 51.01 (5). Subject to s. ss. 632.365 and
21635.09
, rates thus produced may be modified for individual risks in accordance with
22rating plans or schedules that establish reasonable standards for measuring
23probable variations in hazards, expenses, or both. Rates may also be modified for
24individual risks under s. 625.13 (2).
SB218, s. 19
1Section 19. 628.34 (3) (a) of the statutes, as affected by 1995 Wisconsin Act
2289
, is amended to read:
SB218,11,103 628.34 (3) (a) No insurer may unfairly discriminate among policyholders by
4charging different premiums or by offering different terms of coverage except on the
5basis of classifications related to the nature and the degree of the risk covered or the
6expenses involved, subject to ss. 632.365 and 632.745 , 635.03, 635.05, 635.08 and
7635.09
. Rates are not unfairly discriminatory if they are averaged broadly among
8persons insured under a group, blanket or franchise policy, and terms are not
9unfairly discriminatory merely because they are more favorable than in a similar
10individual policy.
SB218, s. 20 11Section 20. 628.34 (3) (b) of the statutes, as affected by 1995 Wisconsin Act
12289
, is amended to read:
SB218,11,1913 628.34 (3) (b) No insurer may refuse to insure or refuse to continue to insure,
14or limit the amount, extent or kind of coverage available to an individual, or charge
15an individual a different rate for the same coverage because of a mental or physical
16disability except when the refusal, limitation or rate differential is based on either
17sound actuarial principles supported by reliable data or actual or reasonably
18anticipated experience, subject to ss. 632.745, 632.747, 632.749, 635.09 and 635.26
19635.03 to 635.09, 635.16 and 635.165.
SB218, s. 21 20Section 21. 628.36 (2) (b) 1. of the statutes is amended to read:
SB218,12,221 628.36 (2) (b) 1. Except for health maintenance organizations, preferred
22provider plans, and limited service health organizations and the small employer
23health insurance plan under subch. II of ch. 635
, no health care plan may prevent
24any person covered under the plan from choosing freely among providers who have

1agreed to participate in the plan and abide by its terms, except by requiring the
2person covered to select primary providers to be used when reasonably possible.
SB218, s. 22 3Section 22. 628.36 (2) (b) 3. of the statutes is amended to read:
SB218,12,84 628.36 (2) (b) 3. Except as provided in subd. 4., no provider may be denied the
5opportunity to participate in a health care plan, other than a health maintenance
6organization, a limited service health organization, or a preferred provider plan or
7the small employer health insurance plan under subch. II of ch. 635
, under the terms
8of the plan.
SB218, s. 23 9Section 23. 628.36 (2) (b) 5. of the statutes is amended to read:
SB218,12,1410 628.36 (2) (b) 5. Except for the small employer health insurance plan under
11subch. II of ch. 635 to the extent determined by the small employer insurance board
12under s. 635.23 (1) (b), all
All health care plans, including health maintenance
13organizations, limited service health organizations and preferred provider plans are
14subject to s. 632.87 (3).
SB218, s. 24 15Section 24. 631.01 (4) of the statutes is amended to read:
SB218,13,216 631.01 (4) Annuities and group policies for eleemosynary institutions. This
17chapter, and ch. 632 and the health insurance mandates under ch. 632 that apply to
18the plan under subch. II of ch. 635
do not apply to annuities or group policies that
19are provided on a basis as uniform nationally as state statutes permit to educational,
20scientific research, religious or charitable institutions organized without profit to
21any person, for the benefit of employes of such institutions. The commissioner may
22by order subject such contracts issued by a particular insurer to this chapter, or ch.
23632 or the health insurance mandates under ch. 632 that apply to the plan under
24subch. II of ch. 635
or any portion of those provisions upon a finding, after a hearing,

1that the interests of Wisconsin insureds or creditors or the public of this state so
2require.
SB218, s. 25 3Section 25. 632.70 of the statutes is repealed.
SB218, s. 26 4Section 26. 632.745 of the statutes, as affected by 1995 Wisconsin Acts 289 and
5453, is repealed.
SB218, s. 27 6Section 27. 632.747 (title) of the statutes, as created by 1995 Wisconsin Act
7289
, is renumbered 635.04 (title) and amended to read:
SB218,13,8 8635.04 (title) Guaranteed acceptance under group plans.
SB218, s. 28 9Section 28. 632.747 (1) of the statutes, as created by 1995 Wisconsin Act 289,
10is renumbered 635.04 (1), and 635.04 (1) (intro.), as renumbered, is amended to read:
SB218,13,1711 635.04 (1) Employe becomes eligible after commencement of coverage.
12(intro.) If Unless otherwise permitted by rule of the commissioner, if an insurer
13provides coverage under a group health benefit plan, the insurer shall provide
14coverage under the group health benefit plan to an eligible employe who becomes
15eligible for coverage after the commencement of the employer's coverage, and to the
16eligible employe's dependents, regardless of health condition or claims experience,
17if all of the following apply:
SB218, s. 29 18Section 29. 632.747 (2) of the statutes, as created by 1995 Wisconsin Act 289,
19is repealed.
SB218, s. 30 20Section 30. 632.747 (3) (intro.) of the statutes, as created by 1995 Wisconsin
21Act 289
, is renumbered 635.04 (2) (intro.).
SB218, s. 31 22Section 31. 632.747 (3) (a) of the statutes, as created by 1995 Wisconsin Act
23289
, is renumbered 635.04 (2) (a) and amended to read:
SB218,14,3
1635.04 (2) (a) The eligible employe was covered as a dependent under
2qualifying creditable coverage when he or she waived coverage under the
3self-insured health plan.
SB218, s. 32 4Section 32. 632.747 (3) (b) of the statutes, as created by 1995 Wisconsin Act
5289
, is renumbered 635.04 (2) (b) and amended to read:
SB218,14,116 635.04 (2) (b) The eligible employe's coverage under the qualifying creditable
7coverage has terminated or will terminate due to a divorce from the insured under
8the qualifying creditable coverage, the death of the insured under the qualifying
9creditable coverage, loss of employment by the insured under the qualifying
10creditable coverage or involuntary loss of coverage under the qualifying creditable
11coverage by the insured under the qualifying creditable coverage.
SB218, s. 33 12Section 33. 632.747 (3) (c) of the statutes, as created by 1995 Wisconsin Act
13289
, is renumbered 635.04 (2) (c) and amended to read:
SB218,14,1614 635.04 (2) (c) The eligible employe applies for coverage under the self-insured
15health plan not more than 30 days after termination of his or her coverage under the
16qualifying creditable coverage.
SB218, s. 34 17Section 34. 632.749 of the statutes, as created by 1997 Wisconsin Act 289, is
18repealed.
SB218, s. 35 19Section 35. 632.76 (2) (a) of the statutes, as affected by 1995 Wisconsin Act
20289
, is amended to read:
SB218,15,221 632.76 (2) (a) No claim for loss incurred or disability commencing after 2 years
22from the date of issue of the policy may be reduced or denied on the ground that a
23disease or physical condition existed prior to the effective date of coverage, unless the
24condition was excluded from coverage by name or specific description by a provision
25effective on the date of loss. This paragraph does not apply to a group health benefit

1plan, as defined in s. 632.745 (1) (c) 635.02 (14), which is subject to s. 632.745 (2)
2635.03 or 635.08 (2).
SB218, s. 36 3Section 36. 632.896 (4) of the statutes, as affected by 1995 Wisconsin Act 289,
4is amended to read:
SB218,15,105 632.896 (4) Preexisting conditions. Notwithstanding ss. 632.745 (2) and
6632.76 (2) (a), 635.03 and 635.08 (2), a disability insurance policy that is subject to
7sub. (2) and that is in effect when a court makes a final order granting adoption or
8when the child is placed for adoption may not exclude or limit coverage of a disease
9or physical condition of the child on the ground that the disease or physical condition
10existed before coverage is required to begin under sub. (3).
SB218, s. 37 11Section 37. 632.898 (1) (b) of the statutes is repealed and recreated to read:
SB218,15,1512 632.898 (1) (b) "Dependent" means a spouse, an unmarried child under the age
13of 19 years, an unmarried child who is a full-time student under the age of 21 years
14and who is financially dependent upon the parent, or an unmarried child of any age
15who is medically certified as disabled and who is dependent upon the parent.
SB218, s. 38 16Section 38. 632.898 (7) of the statutes is amended to read:
SB218,16,517 632.898 (7) If the federal government enacts legislation providing for a federal
18income tax exemption for amounts deposited in an account established under this
19section and for any interest, dividends or other gain that accrues in the account if
20redeposited in the account, the commissioner shall conduct a study, to be completed
21within 4 years after the enactment of the federal legislation, of individuals and
22groups that had coverage under a high cost-share health plan and that terminated
23that coverage in order to enroll in a health benefit plan that was not a high cost-share
24health plan. If as a result of the study the commissioner determines that s. 632.745
25(1) (f) 2.
635.08 (1) (b) is not necessary for the purpose for which it was intended, the

1commissioner shall certify that determination to the revisor of statutes. Upon the
2certification, the revisor of statutes shall publish notice in the Wisconsin
3administrative register of the determination, the date of the certification and that
4after 30 days after the date of the certification s. 632.745 (1) (f) 2. 635.08 (1) (b) is not
5effective.
SB218, s. 39 6Section 39. Chapter 635 (title) of the statutes is amended to read:
SB218,16,77 CHAPTER 635
SB218,16,9 8SMALL EMPLOYER regulation
9of HEALTH INSURANCE
SB218, s. 40 10Section 40. Subchapter I (title) of chapter 635 [precedes 635.01] of the statutes
11is repealed.
SB218, s. 41 12Section 41. 635.01 of the statutes is repealed.
SB218, s. 42 13Section 42. 635.02 of the statutes, as affected by 1995 Wisconsin Act 289, is
14repealed and recreated to read:
SB218,16,15 15635.02 Definitions. In this chapter, unless otherwise specified:
SB218,16,18 16(1) "Affiliation period" means the period which, under the terms of health
17insurance coverage offered by a health maintenance organization, must expire
18before the health insurance coverage becomes effective.
SB218,16,21 19(2) "Base premium rate" means the lowest premium rate chargeable under a
20rating system to employers or individuals with similar case characteristics and the
21same or similar benefit design characteristics.
SB218,16,23 22(3) "Beneficiary" has the meaning given in section 3 (8) of the federal Employee
23Retirement Income Security Act of 1974.
SB218,17,3
1(4) "Benefit design characteristics" means covered services, cost sharing,
2utilization management, managed care networks and other features that
3differentiate plan or coverage designs.
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