Enact the Fair Health Claims Act

hb891_00_IN

As Introduced

136th
General Assembly

Regular
Session
H. B. No. 891

2025-2026

Representative Hall, D.

Cosponsors: Representatives
Piccolantonio, Brennan, White, E., Upchurch

To
amend sections 3901.22 and 3922.07 and to enact sections 3901.216,
3901.97, and 3922.171 of the Revised Code
to
establish a medical claims consumer assistance program, to prohibit
health insurers from improperly denying health claims, and to name
this act the Fair Health Claims Act.

BE
IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section
1.
That
sections 3901.22 and 3922.07 be amended and sections 3901.216,
3901.97, and 3922.171 of the Revised Code be enacted to read as
follows:

Sec.
3901.216.
(A)
As used in this section, "covered person," "health
benefit plan," and "health plan issuer" have the same
meanings as in section 3922.01 of the Revised Code.

(B)
A health plan issuer shall not wrongfully deny, reduce, or terminate
a requested health care service or payment that is covered under a
health benefit plan.

(C)
A violation of this section is subject to the procedures and
penalties set forth in section 3901.22 of the Revised Code, except as
provided in this division. To the extent that any of the provisions
of this division conflict with section 3901.22 of the Revised Code,
the provisions of this division apply.

(1)
If the superintendent of insurance finds that a health plan issuer
has violated this section, the superintendent may request the
attorney general to commence and prosecute an action or proceeding in
the name of the state against the health plan issuer. In addition to
the penalties imposed by section 3901.22 of the Revised Code, the
court may do all of the following in such an action:

(a)
Order the health plan issuer to pay to the covered person double the
amount of the wrongful denial, reduction, or termination of a
requested health care service or payment, plus all expenses
reasonably incurred by the covered person to retain attorneys,
actuaries, accountants, and other experts to assist in the matter;

(b)
Impose damages to be paid by the health plan issuer to the covered
person, in an amount to be determined by the court;

(c)
Impose a civil penalty of not more than twenty-five thousand dollars
for each violation.

(2)
The court may impose additional penalties against a health plan
issuer for repeated violations of this section.

(3)
When imposing penalties under division (C)(1) or (2) of this section,
the court shall consider the factors listed in division (E) of this
section.

(D)
Beginning one year after the effective date of this section and
annually thereafter, the superintendent shall increase any penalty
amounts specified in division (C) of this section by the higher of
the average rate of change in health insurance premium rates in the
individual and small group marketplaces in this state or the current
penalty amounts increased by the rate of inflation for health
insurance, as indicated in the consumer price index for all urban
consumers as published by the United States bureau of labor
statistics.

(E)
In determining penalties under under this section or section 3901.22
of the Revised Code, the superintendent or court shall consider all
of the following factors:

(1)
The nature, scope, and gravity of the violation;

(2)
The severity of the harm to the covered person, including loss of
life or health, emotional distress, and financial harm;

(3)
The nature and extent to which the health plan issuer cooperates with
the department of insurance during an investigation of the violation;

(4)
The nature and extent to which the health plan issuer aggravated or
mitigated any injury or damage caused by the violation;

(5)
The nature and extent to which the health plan issuer has taken
corrective action to ensure such a violation will not recur;

(6)
Evidence of the good or bad faith, intent, or willfulness of the
health plan issuer;

(7)
The health plan issuer's history of violations of this section and
whether the alleged violation is an isolated incident;

(8)
The financial status of the health plan issuer and its affiliates,
including its reserves, financial solvency, excess revenues, or other
financial factors;

(9)
The cost of the health care service in question, including whether a
penalty is commensurate with or exceeds the cost of the service and
the cost based on the number of covered persons affected;

(10)
The number of covered persons affected;

(11)
The frequency of the violation, based on the number of days of the
violation or the estimated number of incidents;

(12)
The severity of the potential harm resulting from the violation,
including loss of life or health, emotional distress, or financial
harm to covered persons;

(13)
The amount of a financial penalty necessary to deter similar
violations in the future.

Sec.
3901.22.
Except
as provided in section 3901.216 of the Revised Code, all of the
following apply to violations of section 3901.20 of the Revised Code:

(A)
The superintendent of insurance may conduct hearings to determine
whether violations of section 3901.20 of the Revised Code have
occurred. Any person aggrieved with respect to any act that the
person believes to be an unfair or deceptive act or practice in the
business of insurance, as defined in section 3901.21 or 3901.211 of
the Revised Code or in any rule of the superintendent, may make
written application to the superintendent for a hearing to determine
if there has been a violation of section 3901.20 of the Revised Code.
The application shall specify the grounds to be relied upon by the
applicant. If the superintendent finds that the application is made
in good faith, that the applicant would be so aggrieved if the
applicant's grounds are established, and that such grounds otherwise
justify holding such a hearing, the superintendent shall hold a
hearing to determine whether the act specified in the application is
a violation of section 3901.20 of the Revised Code. Notice of any
hearing held under the authority of this section, the conduct of the
hearing, the orders issued pursuant to it, the review of the orders
and all other matters relating to the holding of the hearing shall be
governed by Chapter 119. of the Revised Code.

(B)
Upon good cause shown, the superintendent shall permit any person to
intervene, appear, and be heard at the hearing, either in person or
by counsel.

(C)
The superintendent shall send a copy of the order to those persons
intervening in the hearing.

(D)
If the superintendent, by written order, finds that any person has
violated section 3901.20 of the Revised Code, the superintendent
shall issue an order requiring that person to cease and desist from
engaging in the violation. In addition, the superintendent may impose
any or all of the following administrative remedies upon the person:

(1)
The superintendent may suspend or revoke the person's license to
engage in the business of insurance;

(2)
The superintendent may order that an insurance company or insurance
agency not employ the person or permit the person to serve as a
director, consultant, or in any other capacity for such time as the
superintendent determines would serve the public interest. No
application for termination of such an order for an indefinite time
shall be filed within two years of its effective date.

(3)
The superintendent may order the person to return any payments
received by the person as a result of the violation;

(4)
If the superintendent issues an order pursuant to division (D)(3) of
this section, the superintendent shall order the person to pay
statutory interest on such payments.

If
the superintendent does not issue orders pursuant to divisions (D)(3)
and (4) of this section, the superintendent shall expressly state in
the cease-and-desist order the reasons for not issuing such orders.

(5)
The superintendent may order the person to pay to the state treasury
for credit to the department's operating fund an amount, not in
excess of one hundred thousand dollars, equal to one-half of the
expenses reasonably incurred by the superintendent to retain
attorneys, actuaries, accountants, and other experts not otherwise a
part of the superintendent's staff to assist directly in the conduct
of any investigations and hearings conducted with respect to
violations committed by the person.

(E)
If the superintendent has reasonable cause to believe that an order
issued pursuant to division (D) of this section has been violated in
whole or in part, the superintendent may, unless such order is stayed
by a court of competent jurisdiction, request the attorney general to
commence and prosecute any appropriate action or proceeding in the
name of the state against the person.

Such
action may include, but need not be limited to, the commencement of a
class action under Civil Rule 23 on behalf of policyholders,
subscribers, applicants for policies or contracts, or other insurance
consumers for damages caused by or unjust enrichment received as a
result of the violation.

(F)
In addition to any penalties imposed pursuant to this chapter, the
court may, in an action brought pursuant to division (E) of this
section, impose any of the following:

(1)
For each act or practice found to be in violation of section 3901.20
of the Revised Code, a civil penalty of not more than three thousand
five hundred dollars for each violation but not to exceed an
aggregate penalty of thirty-five thousand dollars in any six-month
period, provided that a series of similar acts or practices
prohibited by section 3901.20 of the Revised Code and committed by
the same person but not in separate insurance sales transactions
shall be considered a single violation;

(2)
For each violation of a cease and desist order issued by the
superintendent pursuant to this section, a civil penalty of not more
than ten thousand dollars;

(3)
In addition to any other appropriate relief, the court may order any
or all of the remedies specified in division (D) of this section.

(G)
The superintendent, under a settlement agreement to which a person
has consented in writing for the purpose of assuring the person's
correction of a series of offenses and future compliance with the
laws of this state relating to the business of insurance, may impose
a single penalty in whatever amount the parties determine to be
justified under the circumstances.

(H)
A court of common pleas, in a civil action commenced by the attorney
general on behalf of the superintendent under Civil Rule 65, may
grant a temporary restraining order, preliminary injunction, or
permanent injunction to restrain or prevent a violation or threatened
violation of any provision of section 3901.20 of the Revised Code, if
the court finds that the defendant has violated, is violating, or is
threatening to violate such provision, that immediate and irreparable
injury, loss, or damage will result if such relief is not granted,
and that no adequate remedy at law exists to prevent such irreparable
injury, loss, or damage.

(I)
If the superintendent's position in initiating a matter in
controversy pursuant to this section and section 3901.221 of the
Revised Code was not substantially justified, upon motion of the
person who prevailed in the hearing or in the appropriate court, if
an adjudication order was appealed or a civil action was commenced,
the superintendent or the court shall order the department of
insurance to pay such person an amount, not in excess of one hundred
thousand dollars, equal to one-half of the expenses reasonably
incurred by the person in connection with the related proceedings. An
award pursuant to this division may be reduced or denied if special
circumstances make an award unjust or if the person engaged in
conduct that unduly and unreasonably protracted the final resolution
of the matter in controversy. If the department does not pay such
award or no such funds are available, the award shall be treated as
if it were a judgment under Chapter 2743. of the Revised Code and be
payable in accordance with the procedures specified in section
2743.19 of the Revised Code, except that interest shall not be paid
in relation to the award.

Sec.
3901.97.
(A)
As used in this section, "adverse benefit determination,"
"health benefit plan," and "health plan issuer"
have the same meanings as in section 3922.01 of the Revised Code.

(B)
The superintendent of insurance shall establish the medical claims
consumer assistance program, in accordance with section 2793 of the
"Patient Protection and Affordable Care Act of 2010," 42
U.S.C. 300gg-93, to provide assistance to health benefit plan
consumers in this state, including providing assistance receiving and
responding to consumer inquiries and filing complaints concerning
health insurance coverage. The program shall do all of the following:

(1)
Provide consumers with information about a health plan issuer's
internal appeal and external review processes for adverse benefit
determinations required under Chapter 3922. of the Revised Code and
assist consumers to file complaints and appeals under those
processes;

(2)
Assist consumers and health plan issuers to settle conflicts,
disputed claims, and appealed adverse benefit determinations under a
health benefit plan;

(3)
Collect, track, and quantify problems and inquiries encountered by
consumers relating to coverage under a health benefit plan;

(4)
Educate consumers about their rights and responsibilities with
respect to health benefit plans and health plan issuers;

(5)
Assist consumers enrolling in a health benefit plan by providing
information, referrals, or other similar assistance;

(6)
Assist consumers in obtaining premium assistance tax credits
authorized under section 1401 of the "Patient Protection and
Affordable Care Act of 2010," 26 U.S.C. 36B;

(7)
Through a comprehensive outreach program including, at minimum,
electronic resources and a toll-free telephone number, provide public
information about the services provided by the program.

(C)
The superintendent shall incorporate any existing programs or
initiatives of the department of insurance that perform any of the
functions enumerated in division (B) of this section into the medical
claims consumer assistance program.

(D)
The superintendent may contract with a nonprofit, independent entity
to administer any of the superintendent's duties under the medical
claims consumer assistance program. A health plan issuer, or any
subsidiary or affiliate of a health plan issuer, licensed under Title
XXXIX of the Revised Code may not serve as an entity under this
division.

(E)
Each health plan issuer in this state shall place a prominent, plain
language notice about the medical claims consumer assistance program
on the front page of all health benefit plan communications,
including explanations of benefits, adverse benefit determination
notices, and other plan-related communications.

(F)
The superintendent shall collaborate with other state and local
agencies as necessary to fulfill the duties of this section.

Sec.
3922.07.
In
addition to the information provided under division (D)(1)(b) of
section 3922.05, division (B) of section 3922.08, division (C) of
section 3922.09, and division (D) of section 3922.10 of the Revised
Code, an assigned independent review organization, to the extent that
such documents are available and appropriate, shall consider all of
the following when conducting its review:

(A)
The covered person's medical records;

(B)
The attending health care professional's recommendation;

(C)
Consulting reports from appropriate health care professionals and
other documents submitted by the health plan issuer, covered person,
or covered person's treating provider;

(D)
The terms of coverage under the covered person's health benefit plan
to ensure that the independent review organization's decision is not
contrary to the terms of the plan;

(E)
The most appropriate practice guidelines, including evidence-based
standards, and practice guidelines developed by the federal
government, and national or professional medical societies, boards,
and associations;

(F)
Any applicable clinical review criteria developed and used by the
health plan issuer or its designated utilization review organization;

(G)
The opinion of the independent review organization's clinical
reviewer or reviewers after considering the other sources described
in this section
;

(H)
Any evidence demonstrating intent on the part of the health plan
issuer to improperly deny, reduce, or terminate the requested health
care service or payment to a covered person under a health benefit
plan
.

Sec.
3922.171.
(A)
In addition to the data and reports required by section 3922.17 of
the Revised Code, the superintendent of insurance shall maintain the
following records submitted by health plan issuers pursuant to
division (B) of this section:

(1)
The number, percentage of total health benefit plan claims, and type
of adverse benefit determinations made by the health plan issuer
during the previous calendar year;

(2)
The number, percentage of total health benefit plan claims, and type
of adverse benefit determinations that the superintendent found to be
wrongful under section 3901.216 of the Revised Code during the
previous calendar year.

(B)
Each health plan issuer shall submit the data required under division
(A)(1) of this section to the superintendent, in the form and manner
required by the superintendent.

(C)(1)
Beginning one year after the effective date of this section and
annually thereafter, the superintendent shall submit a report with
the following information about health benefit plan claims in this
state during the previous calendar year:

(a)
The total number and type of adverse benefit determinations made by
health plan issuers in this state;

(b)
The number and type of adverse benefit determinations in this state
found by the superintendent to be wrongful under section 3901.216 of
the Revised Code during the previous calendar year, reported as the
total number of wrongful determinations and as a percentage of the
total adverse benefit determinations during that calendar year;

(c)
The number and type of adverse benefit determinations reported by
consumers to the medical claims consumer assistance program
established under section 3901.97 of the Revised Code;

(d)
Of the number in division (C)(3) of this section, the number, type,
and percentage of that number that were found to be wrongful by the
superintendent under section 3901.216 of the Revised Code;

(e)
Information and outcomes of any investigations conducted by the
department of that health plan issuer for violations of Title XXXIX
of the Revised Code.

(2)
The superintendent shall submit the report required by division
(C)(1) of this section to the attorney general, the governor, the
president and minority leader of the senate, and the speaker and
minority leader of the house of representatives. The superintendent
also shall post the report on its public web site in a machine
readable format.

(3)
The superintendent shall annually review and update the data included
in division (C)(1) of this section.

(D)
If the superintendent finds that a health plan issuer has made
wrongful adverse benefit determinations under section 3901.216 of the
Revised Code in more than the median percentage of wrongful
determinations made in this state by all health plan issuers in that
calendar year, the superintendent shall review the wrongful adverse
benefit determinations and report that information to the attorney
general, the governor, the president and minority leader of the
senate, and the speaker and minority leader of the house of
representatives.

(E)
The superintendent shall collaborate with other state and local
agencies as necessary to fulfill the duties of this section.

Section
2.
That
existing sections 3901.22 and 3922.07 of the Revised Code are hereby
repealed.

Section
3.
This
act shall be known as the Fair Health Claims Act.