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Illinois General Assembly - Full Text of HB4585

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104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
HB4585

Introduced 2/3/2026, by Rep. Lindsey LaPointe

SYNOPSIS AS INTRODUCED:

215 ILCS 5/370c

from Ch. 73, par. 982c

Amends the Illinois Insurance Code. Provides that coverage for
treatment in a residential treatment center shall include residential
coverage for the diagnosis and treatment of substance use disorders.
Provides that this coverage shall include unlimited medically necessary
treatment for substance use disorder treatment services provided in
residential settings. Prohibits the coverage from applying financial
requirements or treatment limitations to residential substance use
disorder benefits that are more restrictive than the predominant financial
requirements and treatment limitations applied to other medical and
surgical benefits covered by the policy. Sets forth provisions concerning
cost sharing; application of coverage requirements; prior authorization;
clinical review; discharge plans; other forms of utilization review; and
the criteria for medical necessity determinations.
LRB104 17523 BAB 30950 b

A BILL FOR

HB4585
LRB104 17523 BAB 30950 b
1

AN ACT concerning regulation.

2

Be it enacted by the People of the State of Illinois,
3
represented in the General Assembly:

4

Section 5.
The Illinois Insurance Code is amended by
5
changing Section 370c as follows:

6

(215 ILCS 5/370c)

(from Ch. 73, par. 982c)
7

Sec. 370c.
Mental and emotional disorders.
8

(a)(1) On and after January 1, 2022 (the effective date of
9
Public Act 102-579), every insurer that amends, delivers,
10
issues, or renews group accident and health policies providing
11
coverage for hospital or medical treatment or services for
12
illness shall provide coverage for the medically necessary
13
treatment of mental, emotional, nervous, or substance use
14
disorders or conditions consistent with the parity
15
requirements of Section 370c.1 of this Code.
16

(2) Each insured that is covered for mental, emotional,
17
nervous, or substance use disorders or conditions shall be
18
free to select the physician licensed to practice medicine in
19
all its branches, licensed clinical psychologist, licensed
20
clinical social worker, licensed clinical professional
21
counselor, licensed marriage and family therapist, licensed
22
speech-language pathologist, or other licensed or certified
23
professional at a program licensed pursuant to the Substance

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LRB104 17523 BAB 30950 b
1
Use Disorder Act of his or her choice to treat such disorders,
2
and the insurer shall pay the covered charges of such
3
physician licensed to practice medicine in all its branches,
4
licensed clinical psychologist, licensed clinical social
5
worker, licensed clinical professional counselor, licensed
6
marriage and family therapist, licensed speech-language
7
pathologist, or other licensed or certified professional at a
8
program licensed pursuant to the Substance Use Disorder Act up
9
to the limits of coverage, provided (i) the disorder or
10
condition treated is covered by the policy, and (ii) the
11
physician, licensed psychologist, licensed clinical social
12
worker, licensed clinical professional counselor, licensed
13
marriage and family therapist, licensed speech-language
14
pathologist, or other licensed or certified professional at a
15
program licensed pursuant to the Substance Use Disorder Act is
16
authorized to provide said services under the statutes of this
17
State and in accordance with accepted principles of his or her
18
profession.
19

(3) Insofar as this Section applies solely to licensed
20
clinical social workers, licensed clinical professional
21
counselors, licensed marriage and family therapists, licensed
22
speech-language pathologists, and other licensed or certified
23
professionals at programs licensed pursuant to the Substance
24
Use Disorder Act, those persons who may provide services to
25
individuals shall do so after the licensed clinical social
26
worker, licensed clinical professional counselor, licensed

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LRB104 17523 BAB 30950 b
1
marriage and family therapist, licensed speech-language
2
pathologist, or other licensed or certified professional at a
3
program licensed pursuant to the Substance Use Disorder Act
4
has informed the patient of the desirability of the patient
5
conferring with the patient's primary care physician.
6

(4) "Mental, emotional, nervous, or substance use disorder
7
or condition" means a condition or disorder that involves a
8
mental health condition or substance use disorder that falls
9
under any of the diagnostic categories listed in the mental
10
and behavioral disorders chapter of the current edition of the
11
World Health Organization's International Classification of
12
Disease or that is listed in the most recent version of the
13
American Psychiatric Association's Diagnostic and Statistical
14
Manual of Mental Disorders. "Mental, emotional, nervous, or
15
substance use disorder or condition" includes any mental
16
health condition that occurs during pregnancy or during the
17
postpartum period and includes, but is not limited to,
18
postpartum depression.
19

(5) Medically necessary treatment and medical necessity
20
determinations shall be interpreted and made in a manner that
21
is consistent with and pursuant to subsections (h) through
22
(y).
23

(b)(1) (Blank).
24

(2) (Blank).
25

(2.5) (Blank).
26

(3) Unless otherwise prohibited by federal law and

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1
consistent with the parity requirements of Section 370c.1 of
2
this Code, the insurer that amends, delivers, issues, or
3
renews a group or individual policy of accident and health
4
insurance, a qualified health plan offered through the health
5
insurance marketplace, or a provider of treatment of mental,
6
emotional, nervous, or substance use disorders or conditions
7
shall furnish medical records or other necessary data that
8
substantiate that initial or continued treatment is at all
9
times medically necessary. Nothing in this paragraph (3)
10
supersedes the prohibition on prior authorization requirements
11
to the extent provided under subsections (g) and (w) and
12
subparagraph (A) of paragraph (6.5) of this subsection.
13
Nothing prevents the insured from agreeing in writing to
14
continue treatment at his or her expense. When making a
15
determination of the medical necessity for a treatment
16
modality for mental, emotional, nervous, or substance use
17
disorders or conditions, an insurer must make the
18
determination in a manner that is consistent with the manner
19
used to make that determination with respect to other diseases
20
or illnesses covered under the policy, including an appeals
21
process. Medical necessity determinations for substance use
22
disorders shall be made in accordance with appropriate patient
23
placement criteria established by the American Society of
24
Addiction Medicine. No additional criteria may be used to make
25
medical necessity determinations for substance use disorders.
26

(4) A group health benefit plan amended, delivered,

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LRB104 17523 BAB 30950 b
1
issued, or renewed on or after January 1, 2019 (the effective
2
date of Public Act 100-1024) or an individual policy of
3
accident and health insurance or a qualified health plan
4
offered through the health insurance marketplace amended,
5
delivered, issued, or renewed on or after January 1, 2019 (the
6
effective date of Public Act 100-1024):
7

(A) shall provide coverage based upon medical
8

necessity for the treatment of a mental, emotional,
9

nervous, or substance use disorder or condition consistent
10

with the parity requirements of Section 370c.1 of this
11

Code; provided, however, that in each calendar year
12

coverage shall not be less than the following:
13

(i) 45 days of inpatient treatment; and
14

(ii) beginning on June 26, 2006 (the effective
15

date of Public Act 94-921), 60 visits for outpatient
16

treatment including group and individual outpatient
17

treatment; and
18

(iii) for plans or policies delivered, issued for
19

delivery, renewed, or modified after January 1, 2007
20

(the effective date of Public Act 94-906), 20
21

additional outpatient visits for speech therapy for
22

treatment of pervasive developmental disorders that
23

will be in addition to speech therapy provided
24

pursuant to item (ii) of this subparagraph (A); and
25

(B) may not include a lifetime limit on the number of
26

days of inpatient treatment or the number of outpatient

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LRB104 17523 BAB 30950 b
1

visits covered under the plan.
2

(C) (Blank).
3

(5) An issuer of a group health benefit plan or an
4
individual policy of accident and health insurance or a
5
qualified health plan offered through the health insurance
6
marketplace may not count toward the number of outpatient
7
visits required to be covered under this Section an outpatient
8
visit for the purpose of medication management and shall cover
9
the outpatient visits under the same terms and conditions as
10
it covers outpatient visits for the treatment of physical
11
illness.
12

(5.5) An individual or group health benefit plan amended,
13
delivered, issued, or renewed on or after September 9, 2015
14
(the effective date of Public Act 99-480) shall offer coverage
15
for medically necessary acute treatment services and medically
16
necessary clinical stabilization services. The treating
17
provider shall base all treatment recommendations and the
18
health benefit plan shall base all medical necessity
19
determinations for substance use disorders in accordance with
20
the most current edition of the Treatment Criteria for
21
Addictive, Substance-Related, and Co-Occurring Conditions
22
established by the American Society of Addiction Medicine. The
23
treating provider shall base all treatment recommendations and
24
the health benefit plan shall base all medical necessity
25
determinations for medication-assisted treatment in accordance
26
with the most current Treatment Criteria for Addictive,

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LRB104 17523 BAB 30950 b
1
Substance-Related, and Co-Occurring Conditions established by
2
the American Society of Addiction Medicine.
3

As used in this subsection:
4

"Acute treatment services" means 24-hour medically
5
supervised addiction treatment that provides evaluation and
6
withdrawal management and may include biopsychosocial
7
assessment, individual and group counseling, psychoeducational
8
groups, and discharge planning.
9

"Clinical stabilization services" means 24-hour treatment,
10
usually following acute treatment services for substance
11
abuse, which may include intensive education and counseling
12
regarding the nature of addiction and its consequences,
13
relapse prevention, outreach to families and significant
14
others, and aftercare planning for individuals beginning to
15
engage in recovery from addiction.
16

"Prior authorization" has the meaning given to that term
17
in Section 15 of the Prior Authorization Reform Act.
18

(6) An issuer of a group health benefit plan may provide or
19
offer coverage required under this Section through a managed
20
care plan.
21

(6.5) An individual or group health benefit plan amended,
22
delivered, issued, or renewed on or after January 1, 2019 (the
23
effective date of Public Act 100-1024):
24

(A) shall not impose prior authorization requirements,
25

including limitations on dosage, other than those
26

established under the Treatment Criteria for Addictive,

HB4585
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LRB104 17523 BAB 30950 b
1

Substance-Related, and Co-Occurring Conditions
2

established by the American Society of Addiction Medicine,
3

on a prescription medication approved by the United States
4

Food and Drug Administration that is prescribed or
5

administered for the treatment of substance use disorders;
6

(B) shall not impose any step therapy requirements;
7

(C) shall place all prescription medications approved
8

by the United States Food and Drug Administration
9

prescribed or administered for the treatment of substance
10

use disorders on, for brand medications, the lowest tier
11

of the drug formulary developed and maintained by the
12

individual or group health benefit plan that covers brand
13

medications and, for generic medications, the lowest tier
14

of the drug formulary developed and maintained by the
15

individual or group health benefit plan that covers
16

generic medications; and
17

(D) shall not exclude coverage for a prescription
18

medication approved by the United States Food and Drug
19

Administration for the treatment of substance use
20

disorders and any associated counseling or wraparound
21

services on the grounds that such medications and services
22

were court ordered.
23

(7) (Blank).
24

(8) (Blank).
25

(9) With respect to all mental, emotional, nervous, or
26
substance use disorders or conditions, coverage for inpatient

HB4585
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LRB104 17523 BAB 30950 b
1
treatment shall include coverage for treatment in a
2
residential treatment center certified or licensed by the
3
Department of Public Health or the Department of Human
4
Services.
5

(A) Coverage for treatment in a residential treatment
6

center shall include residential coverage for the
7

diagnosis and treatment of substance use disorders,
8

including at American Society of Addiction Medicine levels
9

of treatment 3.5 (Clinically Managed High-Intensity
10

Residential) and 3.7 (Medically Managed Residential). This
11

coverage shall include unlimited medically necessary
12

treatment for substance use disorder treatment services
13

provided in residential settings. This coverage shall not
14

apply financial requirements or treatment limitations,
15

including concurrent or utilization review requirements,
16

to residential substance use disorder benefits that are
17

more restrictive than the predominant financial
18

requirements and treatment limitations applied to other
19

medical and surgical benefits covered by the policy.

20

(B) Coverage for treatment in a residential treatment
21

center may be subject to annual deductibles, coinsurance,
22

or other cost sharing that is consistent with those
23

imposed on other benefits covered by the policy.

24

(C) This paragraph (9) shall apply to facilities in
25

this State that are licensed, certified, or otherwise
26

authorized and participating in a provider network.

HB4585
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LRB104 17523 BAB 30950 b
1

Coverage for treatment in a residential treatment center
2

shall not be subject to prior authorization and shall not
3

be subject to concurrent utilization review during the
4

first 3 days of American Society of Addiction Medicine
5

Level 3.7 and the first 28 days of American Society of
6

Addiction Medicine Level 3.5 residential admission, so
7

long as the facility notifies the insurer of both the
8

admission and the initial treatment plan within 3 business
9

days after admission. The facility shall perform clinical
10

review of the patient, including consultation with the
11

insurer at or just prior to the 14th day of treatment to
12

ensure that the facility is using the American Society of
13

Addiction Medicine review tool to ensure that the
14

residential treatment is medically necessary for the
15

patient.

16

(D) Prior to discharge, the facility shall provide the
17

patient and the insurer with a written discharge plan,
18

which shall describe arrangements for additional services
19

needed following discharge from the residential facility,
20

as determined using the evidence-based and peer-reviewed
21

clinical review tool used by the insurer and designated by
22

the relevant Illinois State agencies. Prior to discharge,
23

the facility shall indicate to the insurer whether
24

services included in the discharge plan are secured or
25

determined to be reasonably available.

26

(E) Any utilization review of treatment provided in a

HB4585
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LRB104 17523 BAB 30950 b
1

residential treatment center may include a review of all
2

services provided during such residential treatment,
3

including all services provided during the first 35 days
4

of residential treatment. The insurer shall only deny
5

coverage for any portion of the initial 35-day residential
6

treatment on the basis that the treatment was not
7

medically necessary if the residential treatment was
8

contrary to the evidence-based and peer-reviewed clinical
9

review tool used by the insurer and designated by the
10

relevant Illinois State agencies. An insured shall not
11

have any financial obligation to the facility for any
12

treatment under this subparagraph (E), other than any
13

copayment, coinsurance, or deductible otherwise required
14

under the policy.

15

(F) The criteria for medical necessity determinations
16

under the policy with respect to residential substance use
17

disorder benefits shall be made available by the insurer
18

to any insured, prospective insured, or in-network
19

provider upon request.

20

(c) This Section shall not be interpreted to require
21
coverage for speech therapy or other habilitative services for
22
those individuals covered under Section 356z.15 of this Code.
23

(d) With respect to a group or individual policy of
24
accident and health insurance or a qualified health plan
25
offered through the health insurance marketplace, the
26
Department and, with respect to medical assistance, the

HB4585
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LRB104 17523 BAB 30950 b
1
Department of Healthcare and Family Services shall each
2
enforce the requirements of this Section and Sections 356z.23
3
and 370c.1 of this Code, the Paul Wellstone and Pete Domenici
4
Mental Health Parity and Addiction Equity Act of 2008, 42
5
U.S.C. 18031(j), and any amendments to, and federal guidance
6
or regulations issued under, those Acts, including, but not
7
limited to, final regulations issued under the Paul Wellstone
8
and Pete Domenici Mental Health Parity and Addiction Equity
9
Act of 2008 and final regulations applying the Paul Wellstone
10
and Pete Domenici Mental Health Parity and Addiction Equity
11
Act of 2008 to Medicaid managed care organizations, the
12
Children's Health Insurance Program, and alternative benefit
13
plans. Specifically, the Department and the Department of
14
Healthcare and Family Services shall take action:
15

(1) proactively ensuring compliance by individual and
16

group policies, including by requiring that insurers
17

submit comparative analyses, as set forth in paragraph (6)
18

of subsection (k) of Section 370c.1, demonstrating how
19

they design and apply nonquantitative treatment
20

limitations, both as written and in operation, for mental,
21

emotional, nervous, or substance use disorder or condition
22

benefits as compared to how they design and apply
23

nonquantitative treatment limitations, as written and in
24

operation, for medical and surgical benefits;
25

(2) evaluating all consumer or provider complaints
26

regarding mental, emotional, nervous, or substance use

HB4585
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LRB104 17523 BAB 30950 b
1

disorder or condition coverage for possible parity
2

violations;
3

(3) performing parity compliance market conduct
4

examinations or, in the case of the Department of
5

Healthcare and Family Services, parity compliance audits
6

of individual and group plans and policies, including, but
7

not limited to, reviews of:
8

(A) nonquantitative treatment limitations,
9

including, but not limited to, prior authorization
10

requirements, concurrent review, retrospective review,
11

step therapy, network admission standards,
12

reimbursement rates, and geographic restrictions;
13

(B) denials of authorization, payment, and
14

coverage; and
15

(C) other specific criteria as may be determined
16

by the Department.
17

The findings and the conclusions of the parity compliance
18
market conduct examinations and audits shall be made public.
19

The Director may adopt rules to effectuate any provisions
20
of the Paul Wellstone and Pete Domenici Mental Health Parity
21
and Addiction Equity Act of 2008 that relate to the business of
22
insurance.
23

(e) Availability of plan information.
24

(1) The criteria for medical necessity determinations
25

made under a group health plan, an individual policy of
26

accident and health insurance, or a qualified health plan

HB4585
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LRB104 17523 BAB 30950 b
1

offered through the health insurance marketplace with
2

respect to mental health or substance use disorder
3

benefits (or health insurance coverage offered in
4

connection with the plan with respect to such benefits)
5

must be made available by the plan administrator (or the
6

health insurance issuer offering such coverage) to any
7

current or potential participant, beneficiary, or
8

contracting provider upon request.
9

(2) The reason for any denial under a group health
10

benefit plan, an individual policy of accident and health
11

insurance, or a qualified health plan offered through the
12

health insurance marketplace (or health insurance coverage
13

offered in connection with such plan or policy) of
14

reimbursement or payment for services with respect to
15

mental, emotional, nervous, or substance use disorders or
16

conditions benefits in the case of any participant or
17

beneficiary must be made available within a reasonable
18

time and in a reasonable manner and in readily
19

understandable language by the plan administrator (or the
20

health insurance issuer offering such coverage) to the
21

participant or beneficiary upon request.
22

(f) As used in this Section, "group policy of accident and
23
health insurance" and "group health benefit plan" includes (1)
24
State-regulated employer-sponsored group health insurance
25
plans written in Illinois or which purport to provide coverage
26
for a resident of this State; and (2) State, county,

HB4585
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LRB104 17523 BAB 30950 b
1
municipal, or school district employee health plans.
2
References to an insurer include all plans described in this
3
subsection.
4

(g) (1) As used in this subsection:
5

"Benefits", with respect to insurers that are not Medicaid
6
managed care organizations, means the benefits provided for
7
treatment services for inpatient and outpatient treatment of
8
substance use disorders or conditions at American Society of
9
Addiction Medicine levels of treatment 2.1 (Intensive
10
Outpatient), 2.5 (High-Intensity Outpatient), 3.1 (Clinically
11
Managed Low-Intensity Residential), 3.5 (Clinically Managed
12
High-Intensity Residential), and 3.7 (Medically Managed
13
Residential) and OMT (Opioid Maintenance Therapy) services.
14

"Benefits", with respect to Medicaid managed care
15
organizations, means the benefits provided for treatment
16
services for inpatient and outpatient treatment of substance
17
use disorders or conditions at American Society of Addiction
18
Medicine levels of treatment 2.1 (Intensive Outpatient), 2.5
19
(High-Intensity Outpatient), 3.5 (Clinically Managed
20
High-Intensity Residential), and 3.7 (Medically Managed
21
Residential) and OMT (Opioid Maintenance Therapy) services.
22

"Substance use disorder treatment provider or facility"
23
means a licensed physician, licensed psychologist, licensed
24
psychiatrist, licensed advanced practice registered nurse, or
25
licensed, certified, or otherwise State-approved facility or
26
provider of substance use disorder treatment.

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LRB104 17523 BAB 30950 b
1

(2) A group health insurance policy, an individual health
2
benefit plan, or qualified health plan that is offered through
3
the health insurance marketplace, small employer group health
4
plan, and large employer group health plan that is amended,
5
delivered, issued, executed, or renewed in this State, or
6
approved for issuance or renewal in this State, on or after
7
January 1, 2019 (the effective date of Public Act 100-1023)
8
shall comply with the requirements of this Section and Section
9
370c.1. The services for the treatment and the ongoing
10
assessment of the patient's progress in treatment shall follow
11
the requirements of 77 Ill. Adm. Code 2060.
12

(3) Prior authorization shall not be utilized for the
13
benefits under this subsection. Except to the extent
14
prohibited by Section 370c.1 with respect to treatment
15
limitations in a benefit classification or subclassification,
16
the insurer may require the substance use disorder treatment
17
provider or facility to notify the insurer of the initiation
18
of treatment. For an insurer that is not a Medicaid managed
19
care organization, the substance use disorder treatment
20
provider or facility may be required to give notification for
21
the initiation of treatment of the covered person within 2
22
business days. For Medicaid managed care organizations, the
23
substance use disorder treatment provider or facility may be
24
required to give notification in accordance with the protocol
25
set forth in the provider agreement for initiation of
26
treatment within 24 hours. If the Medicaid managed care

HB4585
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LRB104 17523 BAB 30950 b
1
organization is not capable of accepting the notification in
2
accordance with the contractual protocol during the 24-hour
3
period following admission, the substance use disorder
4
treatment provider or facility shall have one additional
5
business day to provide the notification to the appropriate
6
managed care organization. Treatment plans shall be developed
7
in accordance with the requirements and timeframes established
8
in 77 Ill. Adm. Code 2060. No such coverage shall be subject to
9
concurrent review prior to the applicable notification
10
deadline. If coverage is denied retrospectively, neither the
11
provider or facility nor the insurer shall bill, and the
12
covered individual shall not be liable, for any treatment
13
under this subsection through the date the adverse
14
determination is issued, other than any copayment,
15
coinsurance, or deductible for the treatment or stay through
16
that date as applicable under the policy. Coverage shall not
17
be retrospectively denied for benefits that were furnished at
18
a participating substance use disorder facility prior to the
19
applicable notification deadline except for the following:
20

(A) upon reasonable determination that the benefits
21

were not provided;
22

(B) upon determination that the patient receiving the
23

treatment was not an insured, enrollee, or beneficiary
24

under the policy;
25

(C) upon material misrepresentation by the patient or
26

provider. As used in this subparagraph (C), "material"

HB4585
- 18 -
LRB104 17523 BAB 30950 b
1

means a fact or situation that is not merely technical in
2

nature and results or could result in a substantial change
3

in the situation;
4

(D) upon determination that a service was excluded
5

under the terms of coverage. For situations that qualify
6

under this subparagraph (D), the limitation to billing for
7

a copayment, coinsurance, or deductible shall not apply;
8

(E) upon determination that a service was not
9

medically necessary consistent with subsections (h)
10

through (n); or
11

(F) upon determination that the patient did not
12

consent to the treatment and that there was no court order
13

mandating the treatment.
14

(4) For an insurer that is not a Medicaid managed care
15
organization, if an insurer determines that benefits are no
16
longer medically necessary, the insurer shall notify the
17
covered person, the covered person's authorized
18
representative, if any, and the covered person's health care
19
provider in writing of the covered person's right to request
20
an external review pursuant to the Health Carrier External
21
Review Act. The notification shall occur within 24 hours
22
following the adverse determination.
23

Pursuant to the requirements of the Health Carrier
24
External Review Act, the covered person or the covered
25
person's authorized representative may request an expedited
26
external review. An expedited external review may not occur if

HB4585
- 19 -
LRB104 17523 BAB 30950 b
1
the substance use disorder treatment provider or facility
2
determines that continued treatment is no longer medically
3
necessary.
4

If an expedited external review request meets the criteria
5
of the Health Carrier External Review Act, an independent
6
review organization shall make a final determination of
7
medical necessity within 72 hours. If an independent review
8
organization upholds an adverse determination, an insurer
9
shall remain responsible to provide coverage of benefits
10
through the day following the determination of the independent
11
review organization. A decision to reverse an adverse
12
determination shall comply with the Health Carrier External
13
Review Act.
14

(5) The substance use disorder treatment provider or
15
facility shall provide the insurer with 7 business days'
16
advance notice of the planned discharge of the patient from
17
the substance use disorder treatment provider or facility and
18
notice on the day that the patient is discharged from the
19
substance use disorder treatment provider or facility.
20

(6) The benefits required by this subsection shall be
21
provided to all covered persons with a diagnosis of substance
22
use disorder or conditions. The presence of additional related
23
or unrelated diagnoses shall not be a basis to reduce or deny
24
the benefits required by this subsection.
25

(7) Nothing in this subsection shall be construed to
26
require an insurer to provide coverage for any of the benefits

HB4585
- 20 -
LRB104 17523 BAB 30950 b
1
in this subsection.
2

(8) Any concurrent or retrospective review permitted by
3
this subsection must be consistent with the utilization review
4
provisions in subsections (h) through (n).
5

(h) As used in this Section:
6

"Generally accepted standards of mental, emotional,
7
nervous, or substance use disorder or condition care" means
8
standards of care and clinical practice that are generally
9
recognized by health care providers practicing in relevant
10
clinical specialties such as psychiatry, psychology, clinical
11
sociology, social work, addiction medicine and counseling, and
12
behavioral health treatment. Valid, evidence-based sources
13
reflecting generally accepted standards of mental, emotional,
14
nervous, or substance use disorder or condition care include
15
peer-reviewed scientific studies and medical literature,
16
recommendations of nonprofit health care provider professional
17
associations and specialty societies, including, but not
18
limited to, patient placement criteria and clinical practice
19
guidelines, recommendations of federal government agencies,
20
and drug labeling approved by the United States Food and Drug
21
Administration.
22

"Medically necessary treatment of mental, emotional,
23
nervous, or substance use disorders or conditions" means a
24
service or product addressing the specific needs of that
25
patient, for the purpose of screening, preventing, diagnosing,
26
managing, or treating an illness, injury, or condition or its

HB4585
- 21 -
LRB104 17523 BAB 30950 b
1
symptoms and comorbidities, including minimizing the
2
progression of an illness, injury, or condition or its
3
symptoms and comorbidities in a manner that is all of the
4
following:
5

(1) in accordance with the generally accepted
6

standards of mental, emotional, nervous, or substance use
7

disorder or condition care;
8

(2) clinically appropriate in terms of type,
9

frequency, extent, site, and duration; and
10

(3) not primarily for the economic benefit of the
11

insurer, purchaser, or for the convenience of the patient,
12

treating physician, or other health care provider.
13

"Utilization review" means either of the following:
14

(1) prospectively, retrospectively, or concurrently
15

reviewing and approving, modifying, delaying, or denying,
16

based in whole or in part on medical necessity, requests
17

by health care providers, insureds, or their authorized
18

representatives for coverage of health care services
19

before, retrospectively, or concurrently with the
20

provision of health care services to insureds.
21

(2) evaluating the medical necessity, appropriateness,
22

level of care, service intensity, efficacy, or efficiency
23

of health care services, benefits, procedures, or
24

settings, under any circumstances, to determine whether a
25

health care service or benefit subject to a medical
26

necessity coverage requirement in an insurance policy is

HB4585
- 22 -
LRB104 17523 BAB 30950 b
1

covered as medically necessary for an insured.
2

"Utilization review criteria" means patient placement
3
criteria or any criteria, standards, protocols, or guidelines
4
used by an insurer to conduct utilization review.
5

(i)(1) Every insurer that amends, delivers, issues, or
6
renews a group or individual policy of accident and health
7
insurance or a qualified health plan offered through the
8
health insurance marketplace in this State and Medicaid
9
managed care organizations providing coverage for hospital or
10
medical treatment on or after January 1, 2023 shall, pursuant
11
to subsections (h) through (s), provide coverage for medically
12
necessary treatment of mental, emotional, nervous, or
13
substance use disorders or conditions.
14

(2) An insurer shall not set a specific limit on the
15
duration of benefits or coverage of medically necessary
16
treatment of mental, emotional, nervous, or substance use
17
disorders or conditions or limit coverage only to alleviation
18
of the insured's current symptoms.
19

(3) All utilization review conducted by the insurer
20
concerning diagnosis, prevention, and treatment of insureds
21
diagnosed with mental, emotional, nervous, or substance use
22
disorders or conditions shall be conducted in accordance with
23
the requirements of subsections (k) through (w).
24

(4) An insurer that authorizes a specific type of
25
treatment by a provider pursuant to this Section shall not
26
rescind or modify the authorization after that provider

HB4585
- 23 -
LRB104 17523 BAB 30950 b
1
renders the health care service in good faith and pursuant to
2
this authorization for any reason, including, but not limited
3
to, the insurer's subsequent cancellation or modification of
4
the insured's or policyholder's contract, or the insured's or
5
policyholder's eligibility. Nothing in this Section shall
6
require the insurer to cover a treatment when the
7
authorization was granted based on a material
8
misrepresentation by the insured, the policyholder, or the
9
provider. Nothing in this Section shall require Medicaid
10
managed care organizations to pay for services if the
11
individual was not eligible for Medicaid at the time the
12
service was rendered. Nothing in this Section shall require an
13
insurer to pay for services if the individual was not the
14
insurer's enrollee at the time services were rendered. As used
15
in this paragraph, "material" means a fact or situation that
16
is not merely technical in nature and results in or could
17
result in a substantial change in the situation.
18

(j) An insurer shall not limit benefits or coverage for
19
medically necessary services on the basis that those services
20
should be or could be covered by a public entitlement program,
21
including, but not limited to, special education or an
22
individualized education program, Medicaid, Medicare,
23
Supplemental Security Income, or Social Security Disability
24
Insurance, and shall not include or enforce a contract term
25
that excludes otherwise covered benefits on the basis that
26
those services should be or could be covered by a public

HB4585
- 24 -
LRB104 17523 BAB 30950 b
1
entitlement program. Nothing in this subsection shall be
2
construed to require an insurer to cover benefits that have
3
been authorized and provided for a covered person by a public
4
entitlement program. Medicaid managed care organizations are
5
not subject to this subsection.
6

(k) An insurer shall base any medical necessity
7
determination or the utilization review criteria that the
8
insurer, and any entity acting on the insurer's behalf,
9
applies to determine the medical necessity of health care
10
services and benefits for the diagnosis, prevention, and
11
treatment of mental, emotional, nervous, or substance use
12
disorders or conditions on current generally accepted
13
standards of mental, emotional, nervous, or substance use
14
disorder or condition care. All denials and appeals shall be
15
reviewed by a professional with experience or expertise
16
comparable to the provider requesting the authorization.
17

(l) In conducting utilization review of all covered health
18
care services for the diagnosis, prevention, and treatment of
19
mental, emotional, and nervous disorders or conditions, an
20
insurer shall apply the criteria and guidelines set forth in
21
the most recent version of the treatment criteria developed by
22
an unaffiliated nonprofit professional association for the
23
relevant clinical specialty or, for Medicaid managed care
24
organizations, criteria and guidelines determined by the
25
Department of Healthcare and Family Services that are
26
consistent with generally accepted standards of mental,

HB4585
- 25 -
LRB104 17523 BAB 30950 b
1
emotional, nervous or substance use disorder or condition
2
care. Pursuant to subsection (b), in conducting utilization
3
review of all covered services and benefits for the diagnosis,
4
prevention, and treatment of substance use disorders an
5
insurer shall use the most recent edition of the patient
6
placement criteria established by the American Society of
7
Addiction Medicine.
8

(m) In conducting utilization review relating to level of
9
care placement, continued stay, transfer, discharge, or any
10
other patient care decisions that are within the scope of the
11
sources specified in subsection (l), an insurer shall not
12
apply different, additional, conflicting, or more restrictive
13
utilization review criteria than the criteria set forth in
14
those sources. For all level of care placement decisions, the
15
insurer shall authorize placement at the level of care
16
consistent with the assessment of the insured using the
17
relevant patient placement criteria as specified in subsection
18
(l). If that level of placement is not available, the insurer
19
shall authorize the next higher level of care. In the event of
20
disagreement, the insurer shall provide full detail of its
21
assessment using the relevant criteria as specified in
22
subsection (l) to the provider of the service and the patient.
23

If an insurer purchases or licenses utilization review
24
criteria pursuant to this subsection, the insurer shall verify
25
and document before use that the criteria were developed in
26
accordance with subsection (k).

HB4585
- 26 -
LRB104 17523 BAB 30950 b
1

(n) In conducting utilization review that is outside the
2
scope of the criteria as specified in subsection (l) or
3
relates to the advancements in technology or in the types or
4
levels of care that are not addressed in the most recent
5
versions of the sources specified in subsection (l), an
6
insurer shall conduct utilization review in accordance with
7
subsection (k).
8

(o) This Section does not in any way limit the rights of a
9
patient under the Medical Patient Rights Act.
10

(p) This Section does not in any way limit early and
11
periodic screening, diagnostic, and treatment benefits as
12
defined under 42 U.S.C. 1396d(r).
13

(q) To ensure the proper use of the criteria described in
14
subsection (l), every insurer shall do all of the following:
15

(1) Educate the insurer's staff, including any third
16

parties contracted with the insurer to review claims,
17

conduct utilization reviews, or make medical necessity
18

determinations about the utilization review criteria.
19

(2) Make the educational program available to other
20

stakeholders, including the insurer's participating or
21

contracted providers and potential participants,
22

beneficiaries, or covered lives. The education program
23

must be provided at least once a year, in-person or
24

digitally, or recordings of the education program must be
25

made available to the aforementioned stakeholders.
26

(3) Provide, at no cost, the utilization review

HB4585
- 27 -
LRB104 17523 BAB 30950 b
1

criteria and any training material or resources to
2

providers and insured patients upon request. For
3

utilization review criteria not concerning level of care
4

placement, continued stay, transfer, discharge, or other
5

patient care decisions used by the insurer pursuant to
6

subsection (m), the insurer may place the criteria on a
7

secure, password-protected website so long as the access
8

requirements of the website do not unreasonably restrict
9

access to insureds or their providers. No restrictions
10

shall be placed upon the insured's or treating provider's
11

access right to utilization review criteria obtained under
12

this paragraph at any point in time, including before an
13

initial request for authorization.
14

(4) Track, identify, and analyze how the utilization
15

review criteria are used to certify care, deny care, and
16

support the appeals process.
17

(5) Conduct interrater reliability testing to ensure
18

consistency in utilization review decision making that
19

covers how medical necessity decisions are made; this
20

assessment shall cover all aspects of utilization review
21

as defined in subsection (h).
22

(6) Run interrater reliability reports about how the
23

clinical guidelines are used in conjunction with the
24

utilization review process and parity compliance
25

activities.
26

(7) Achieve interrater reliability pass rates of at

HB4585
- 28 -
LRB104 17523 BAB 30950 b
1

least 90% and, if this threshold is not met, immediately
2

provide for the remediation of poor interrater reliability
3

and interrater reliability testing for all new staff
4

before they can conduct utilization review without
5

supervision.
6

(8) Maintain documentation of interrater reliability
7

testing and the remediation actions taken for those with
8

pass rates lower than 90% and submit to the Department of
9

Insurance or, in the case of Medicaid managed care
10

organizations, the Department of Healthcare and Family
11

Services the testing results and a summary of remedial
12

actions as part of parity compliance reporting set forth
13

in subsection (k) of Section 370c.1.
14

(r) This Section applies to all health care services and
15
benefits for the diagnosis, prevention, and treatment of
16
mental, emotional, nervous, or substance use disorders or
17
conditions covered by an insurance policy, including
18
prescription drugs.
19

(s) This Section applies to an insurer that amends,
20
delivers, issues, or renews a group or individual policy of
21
accident and health insurance or a qualified health plan
22
offered through the health insurance marketplace in this State
23
providing coverage for hospital or medical treatment and
24
conducts utilization review as defined in this Section,
25
including Medicaid managed care organizations, and any entity
26
or contracting provider that performs utilization review or

HB4585
- 29 -
LRB104 17523 BAB 30950 b
1
utilization management functions on an insurer's behalf.
2

(t) If the Director determines that an insurer has
3
violated this Section, the Director may, after appropriate
4
notice and opportunity for hearing, by order, assess a civil
5
penalty between $1,000 and $5,000 for each violation. Moneys
6
collected from penalties shall be deposited into the Parity
7
Advancement Fund established in subsection (i) of Section
8
370c.1.
9

(u) An insurer shall not adopt, impose, or enforce terms
10
in its policies or provider agreements, in writing or in
11
operation, that undermine, alter, or conflict with the
12
requirements of this Section.
13

(v) The provisions of this Section are severable. If any
14
provision of this Section or its application is held invalid,
15
that invalidity shall not affect other provisions or
16
applications that can be given effect without the invalid
17
provision or application.
18

(w) Beginning January 1, 2026, coverage for medically
19
necessary treatment of mental, emotional, or nervous disorders
20
or conditions shall comply with the following requirements:
21

(1) No policy shall require prior authorization for
22

outpatient or partial hospitalization services for
23

treatment of mental, emotional, or nervous disorders or
24

conditions provided by a physician licensed to practice
25

medicine in all branches, a licensed clinical
26

psychologist, a licensed clinical social worker, a

HB4585
- 30 -
LRB104 17523 BAB 30950 b
1

licensed clinical professional counselor, a licensed
2

marriage and family therapist, a licensed speech-language
3

pathologist, or any other type of licensed, certified, or
4

legally authorized provider, including trainees working
5

under the supervision of a licensed health care
6

professional listed under this subsection, or facility
7

whose outpatient or partial hospitalization services the
8

policy covers for treatment of mental, emotional, or
9

nervous disorders or conditions. Such coverage may be
10

subject to concurrent and retrospective review consistent
11

with the utilization review provisions in subsections (h)
12

through (n) and Section 370c.1. Nothing in this paragraph
13

(1) supersedes a health maintenance organization's
14

referral requirement for services from nonparticipating
15

providers. An insurer may require providers or facilities
16

to notify the insurer of the initiation of treatment as
17

specified in this subsection, except to the extent
18

prohibited by Section 370c.1 with respect to treatment
19

limitations in a benefit classification or
20

subclassification. No such coverage shall be subject to
21

concurrent review for any services furnished before an
22

applicable notification deadline, subject to the
23

following:
24

(A) In the case of outpatient treatment, for an
25

insurer that is not a Medicaid managed care
26

organization, the insurer may set a notification

HB4585
- 31 -
LRB104 17523 BAB 30950 b
1

deadline of 2 business days after the initiation of
2

the covered person's treatment. A Medicaid managed
3

care organization may set a deadline of 24 hours after
4

the initiation of treatment. If the Medicaid managed
5

care organization is not capable of accepting the
6

notification in accordance with the contractual
7

protocol within the 24-hour period following
8

initiation, the treatment provider or facility shall
9

have one additional business day to provide the
10

notification to the Medicaid managed care
11

organization.
12

(B) In the case of a partial hospitalization
13

program, for an insurer that is not a Medicaid managed
14

care organization, the insurer may set a notification
15

deadline of 48 hours after the initiation of the
16

covered person's treatment. A Medicaid managed care
17

organization may set a deadline of 24 hours after the
18

initiation of treatment. If the Medicaid managed care
19

organization is not capable of accepting the
20

notification in accordance with the contractual
21

protocol during the 24-hour period following
22

initiation, the treatment provider or facility shall
23

have one additional business day to provide the
24

notification to the Medicaid managed care
25

organization.
26

(2) No policy shall require prior authorization for

HB4585
- 32 -
LRB104 17523 BAB 30950 b
1

inpatient treatment at a hospital for mental, emotional,
2

or nervous disorders or conditions at a participating
3

provider. Additionally, no such coverage shall be subject
4

to concurrent review for the first 72 hours after
5

admission, provided that the provider must notify the
6

insurer of both the admission and the initial treatment
7

plan within 48 hours of admission. A discharge plan must
8

be fully developed and continuity services prepared to
9

meet the patient's needs and the patient's community
10

preference upon release. Recommended level of care
11

placements identified in the discharge plan shall comply
12

with generally accepted standards of care, as defined in
13

subsection (h).
14

(A) If the provider satisfies the conditions of
15

paragraph (2), then the insurer shall approve coverage
16

of the recommended level of care, if applicable, upon
17

discharge subject to concurrent review.
18

(B) Nothing in this paragraph supersedes a health
19

maintenance organization's referral requirement for
20

services from nonparticipating providers upon a
21

patient's discharge from a hospital or facility.
22

(C) Concurrent review for such coverage must be
23

consistent with the utilization review provisions in
24

subsections (h) through (n).
25

(D) In this subsection, residential treatment that
26

is not otherwise identified in the discharge plan is

HB4585
- 33 -
LRB104 17523 BAB 30950 b
1

not inpatient hospitalization.
2

(3) Treatment provided under this subsection may be
3

reviewed retrospectively. If coverage is denied
4

retrospectively, neither the insurer nor the participating
5

provider shall bill, and the insured shall not be liable,
6

for any treatment under this subsection through the date
7

the adverse determination is issued, other than any
8

copayment, coinsurance, or deductible for the stay through
9

that date as applicable under the policy. Coverage shall
10

not be retrospectively denied for the first 72 hours of
11

admission to inpatient hospitalization for treatment of
12

mental, emotional, or nervous disorders or conditions, or
13

before the applicable deadline under paragraph (1) of this
14

subsection for outpatient treatment or partial
15

hospitalization programs, at a participating provider
16

except:
17

(A) upon reasonable determination that the
18

inpatient mental health treatment was not provided;
19

(B) upon determination that the patient receiving
20

the treatment was not an insured, enrollee, or
21

beneficiary under the policy;
22

(C) upon material misrepresentation by the patient
23

or health care provider. In this item (C), "material"
24

means a fact or situation that is not merely technical
25

in nature and results or could result in a substantial
26

change in the situation;

HB4585
- 34 -
LRB104 17523 BAB 30950 b
1

(D) upon determination that a service was excluded
2

under the terms of coverage. In that case, the
3

limitation to billing for a copayment, coinsurance, or
4

deductible shall not apply;
5

(E) for outpatient treatment or partial
6

hospitalization programs only, upon determination that
7

a service was not medically necessary consistent with
8

subsections (h) through (n); or
9

(F) upon determination that the patient did not
10

consent to the treatment and that there was no court
11

order mandating the treatment.
12

Nothing in this subsection shall be construed to
13

require a policy to cover any health care service excluded
14

under the terms of coverage.
15

This subsection does not apply to coverage for any
16

prescription or over-the-counter drug.
17

Nothing in this subsection shall be construed to
18

require the medical assistance program to reimburse for
19

services not covered by the medical assistance program as
20

authorized by the Illinois Public Aid Code or the
21

Children's Health Insurance Program Act.
22

(x) Notwithstanding any provision of this Section, nothing
23
shall require the medical assistance program under Article V
24
of the Illinois Public Aid Code or the Children's Health
25
Insurance Program Act to violate any applicable federal laws,
26
regulations, or grant requirements, including requirements for

HB4585
- 35 -
LRB104 17523 BAB 30950 b
1
utilization management, or any State or federal consent
2
decrees. Nothing in subsection (g) or (w) shall prevent the
3
Department of Healthcare and Family Services from requiring a
4
health care provider to use specified level of care,
5
admission, continued stay, or discharge criteria, including,
6
but not limited to, those under Section 5-5.23 of the Illinois
7
Public Aid Code, as long as the Department of Healthcare and
8
Family Services, subject to applicable federal laws,
9
regulations, or grant requirements, including requirements for
10
utilization management, does not require a health care
11
provider to seek prior authorization or concurrent review from
12
the Department of Healthcare and Family Services, a Medicaid
13
managed care organization, or a utilization review
14
organization under the circumstances expressly prohibited by
15
subsections (g) and (w). Nothing in this Section prohibits a
16
health plan, including a Medicaid managed care organization,
17
from conducting reviews for medical necessity, clinical
18
appropriateness, safety, fraud, waste, or abuse and reporting
19
suspected fraud, waste, or abuse according to State and
20
federal requirements. Nothing in this Section limits the
21
authority of the Department of Healthcare and Family Services
22
or another State agency, or a Medicaid managed care
23
organization on the State agency's behalf, to (i) implement or
24
require programs, services, screenings, assessments, tools, or
25
reviews to comply with applicable federal law, federal
26
regulation, federal grant requirements, any State or federal

HB4585
- 36 -
LRB104 17523 BAB 30950 b
1
consent decrees or court orders, or any applicable case law,
2
such as Olmstead v. L.C., 527 U.S. 581 (1999), or (ii)
3
administer or require programs, services, screenings,
4
assessments, tools, or reviews established under State or
5
federal laws, rules, or regulations in compliance with State
6
or federal laws, rules, or regulations, including, but not
7
limited to, the Children's Mental Health Act and the Mental
8
Health and Developmental Disabilities Administrative Act.
9

(y) (Blank).
10
(Source: P.A. 103-426, eff. 8-4-23; 103-650, eff. 1-1-25;
11
103-1040, eff. 8-9-24; 104-28, eff. 1-1-26; 104-417, eff.
12
8-15-25
.)

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