Scope Statements
Insurance
This statement of scope was approved by the governor on December 1, 2011.
Rule No.
Subject
Repeal of
EmR1117. Revises Ch.
Ins 18, relating to grievances and independent review requirements and affecting small business.
Description of the Objective of the Rule
The Office of the Commissioner of Insurance's objective for an emergency rule is to repeal the amendments made to ch.
Ins 18, Wis. Adm. Code, in EmR 1117 that was published November 16, 2011. Repeal is necessary in order to return the Wisconsin grievance and independent review provisions to the prior form.
Description of Existing Policies Relevant to the Rule and of New Policies Proposed to be Included in the Rule and an Analysis of Policy Alternatives; the History, Background and Justification for the Proposed Rule
Wisconsin currently regulates the conduct of insurers and independent review organizations relating to an insured's right to file grievances with his or her insurer and seek independent review of coverage denial determinations. Sections
632.83 and
632.835, Stats., as implemented by Ch.
Ins 18, Wis. Adm. Code, provide the structure and requirements for processing grievances and requests for independent review. The law and regulations have provided structure for insurers, guidance for insureds and oversight of independent review organizations.
Despite amendments to the Public Health Service Act and promulgation of regulations to implement those changes regarding internal appeals and independent external review, states can choose whether or not to demonstrate compliance with the amended federal law and regulations. Subsequent to the issuance of the emergency rule implementing modifications to Ch.
Ins 18, Wis. Adm. Code, it has been determined that it is in the interest of the State of Wisconsin to rescind its position regarding implementation of the federal changes to handling grievances and independent review requests.
Since Wisconsin had grievance and independent review laws and regulations prior to March 13, 2010, the State was eligible to delay implementation of the amended grievance and independent review requirements related to the Patient Protection and Affordable Care Act, as amended, to January 1, 2012. Although the Office implemented the modifications on November 16, 2011, the commissioner has determined that it is in the best interest of the consumers and insurers to retain prior regulations and not exempt insurers and independent review organizations from s.
632.83 and
632.835, Stats. To minimize confusion for the insurance industry and Wisconsin consumers, the Office intends to promulgate this rule as an emergency rule.
Statutory Authority for the Rule (Including the Statutory Citation and Language)
Estimate of the Amount of Time that State Employees will Spend to Develop the Rule and of Other Resources Necessary to Develop the Rule
100 hours and no other resources are necessary.
Description of all Entities that may be Impacted by the Rule
Nearly all entities related to health insurance are affected by the changes to the Public Health Service Act, as amended, including intermediaries, insurers, independent review organizations and third-party administrators. Affected entities will have to comply with federal regulations and state regulations.
Summary and Preliminary Comparison of any Existing or Proposed Federal Regulation that is Intended to Address the Activities to be Regulated by the Rule
The Public Health Service Act, as amended, (
42 USC 300gg et seq.) provides insureds a right to grieve an adverse benefit determination and request an independent external review of the determination. The US Department of Health and Human Services (DHHS) in conjunction with the National Association of Insurance Commissioners (NAIC) issued and amended federal regulations (
45 CFR 147.136) implementing portions of the Public Health Service Act as amended. The regulations in large part incorporate the NAIC Uniform Health Carrier External Review Model Act (NAIC Model Act). In addition to the regulations, the DHHS issued four technical guidance documents between July 2010 and June 2011 to assist states, insurers and consumers with understanding the requirements for compliant internal appeal and external independent review processes.
Sections
632.83 and
632.835, Stats., provide Wisconsin's framework for grievances and independent review while Ch.
Ins 18, Wis. Adm. Code, implements the statutes while providing unique options for insureds, insurers and independent review organizations not contained in the NAIC Model Act. Although Wisconsin's former version of the administrative code contains provisions may be interpreted to conflict with the federal law, the state prefers to maintain its grievance and independent review process to the extent it is able under the law.
An emergency rule will be needed in order to provide sufficient time for insurers to draft forms, policies and procedures that comply with federal and state requirements and give sufficient notice to consumers for handling grievances or independent review requests after January 1, 2012.
Agency Contact Person
Julie E. Walsh, Attorney, 608-264-8101.
