1. Senate Bill No. 557–Senator Townsend

CHAPTER........

AN ACT relating to health insurance; requiring certain policies of health insurance to include

coverage for the treatment of conditions relating to severe mental illness; and

providing other matters properly relating thereto.

 

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

Section 1. Chapter 689A of NRS is hereby amended by adding thereto

a new section to read as follows:

1. Notwithstanding any provisions of this Title to the contrary, a

policy of health insurance delivered or issued for delivery in this state

pursuant to this chapter must provide coverage for the treatment of

conditions relating to severe mental illness.

2. The coverage required by this section:

(a) Must provide:

(1) Benefits for at least 40 days of hospitalization as an inpatient

per policy year and 40 visits for treatment as an outpatient per policy

year, excluding visits for the management of medication; and

(2) That two visits for partial or respite care, or a combination

thereof, may be substituted for each 1 day of hospitalization not used by

the insured. In no event is the policy required to provide coverage for

more than 40 days of hospitalization as an inpatient per policy year.

(b) Is not required to provide benefits for psychosocial rehabilitation

or care received as a custodial inpatient.

3. Any deductibles and copayments required to be paid for the

coverage required by this section must not be greater than 150 percent of

the out-of-pocket expenses required to be paid for medical and surgical

benefits provided pursuant to the policy of health insurance.

4. The provisions of this section do not apply to a policy of health

insurance if, at the end of the policy year, the premiums charged for that

policy, or a standard grouping of policies, increase by more than 2

percent as a result of providing the coverage required by this section and

the insurer obtains an exemption from the commissioner pursuant to

subsection 5.

5. To obtain the exemption required by subsection 4, an insurer must

submit to the commissioner a written request therefor that is signed by an

actuary and sets forth the reasons and actuarial assumptions upon which

the request is based. To determine whether an exemption may be

granted, the commissioner shall subtract from the amount of premiums

charged during the policy year the amount of premiums charged during

the period immediately preceding the policy year and the amount of any

increase in the premiums charged that is attributable to factors that are

unrelated to providing the coverage required by this section. The

commissioner shall verify the information within 30 days after receiving

the request. The request shall be deemed approved if the commissioner

does not deny the request within that time.

6. The provisions of this section do not:

(a) Limit the provision of specialized services covered by Medicaid for

persons with conditions relating to mental health or substance abuse.

(b) Supersede any provision of federal law, any federal or state policy

relating to Medicaid, or the terms and conditions imposed on any

Medicaid waiver granted to this state with respect to the provisions of

services to persons with conditions relating to mental health or substance

abuse.

7. A policy of health insurance subject to the provisions of this

chapter which is delivered, issued for delivery or renewed on or after

January 1, 2000, has the legal effect of including the coverage required

by this section, and any provision of the policy or the renewal which is in

conflict with this section is void, unless the policy is otherwise exempt

from the provisions of this section pursuant to subsection 4.

8. As used in this section, "severe mental illness" means any of the

following mental illnesses that are biologically based and for which

diagnostic criteria are prescribed in the "Diagnostic and Statistical

Manual of Mental Disorders," Fourth Edition, published by the

American Psychiatric Association:

(a) Schizophrenia.

(b) Schizoaffective disorder.

(c) Bipolar disorder.

(d) Major depressive disorders.

(e) Panic disorder.

(f) Obsessive-compulsive disorder.

Sec. 2. Chapter 689B of NRS is hereby amended by adding thereto a

new section to read as follows:

1. Notwithstanding any provisions of this Title to the contrary, a

policy of group health insurance delivered or issued for delivery in this

state pursuant to this chapter must provide coverage for the treatment of

conditions relating to severe mental illness.

2. The coverage required by this section:

(a) Must provide:

(1) Benefits for at least 40 days of hospitalization as an inpatient

per policy year and 40 visits for treatment as an outpatient per policy

year, excluding visits for the management of medication; and

(2) That two visits for partial or respite care, or a combination

thereof, may be substituted for each 1 day of hospitalization not used by

the insured. In no event is the policy required to provide coverage for

more than 40 days of hospitalization as an inpatient per policy year.

(b) Is not required to provide benefits for psychosocial rehabilitation

or care received as a custodial inpatient.

3. Any deductibles and copayments required to be paid for the

coverage required by this section must not be greater than 150 percent of

the out-of-pocket expenses required to be paid for medical and surgical

benefits provided pursuant to the policy of group health insurance.

4. The provisions of this section do not apply to a policy of group

health insurance:

(a) Delivered or issued for delivery to an employer to provide coverage

for his employees if the employer has no more than 25 employees.

(b) If, at the end of the policy year, the premiums charged for that

policy, or a standard grouping of policies, increase by more than 2

percent as a result of providing the coverage required by this section and

the insurer obtains an exemption from the commissioner pursuant to

subsection 5.

5. To obtain the exemption required by paragraph (b) of subsection

4, an insurer must submit to the commissioner a written request therefor

that is signed by an actuary and sets forth the reasons and actuarial

assumptions upon which the request is based. To determine whether an

exemption may be granted, the commissioner shall subtract from the

amount of premiums charged during the policy year the amount of

premiums charged during the period immediately preceding the policy

year and the amount of any increase in the premiums charged that is

attributable to factors that are unrelated to providing the coverage

required by this section. The commissioner shall verify the information

within 30 days after receiving the request. The request shall be deemed

approved if the commissioner does not deny the request within that time.

6. The provisions of this section do not:

(a) Limit the provision of specialized services covered by Medicaid for

persons with conditions relating to mental health or substance abuse.

(b) Supersede any provision of federal law, any federal or state policy

relating to Medicaid, or the terms and conditions imposed on any

Medicaid waiver granted to this state with respect to the provisions of

services to persons with conditions relating to mental health or substance

abuse.

7. A policy of group health insurance subject to the provisions of this

chapter which is delivered, issued for delivery or renewed on or after

January 1, 2000, has the legal effect of including the coverage required

by this section, and any provision of the policy or the renewal which is in

conflict with this section is void, unless the policy is otherwise exempt

from the provisions of this section pursuant to subsection 4.

8. As used in this section, "severe mental illness" means any of the

following mental illnesses that are biologically based and for which

diagnostic criteria are prescribed in the "Diagnostic and Statistical

Manual of Mental Disorders," Fourth Edition, published by the

American Psychiatric Association:

(a) Schizophrenia.

(b) Schizoaffective disorder

.

(c) Bipolar disorder.

(d) Major depressive disorders.

(e) Panic disorder.

(f) Obsessive-compulsive disorder.

Sec. 3. Chapter 695B of NRS is hereby amended by adding thereto a

new section to read as follows:

1. Notwithstanding any provisions of this Title to the contrary, a

contract for hospital or medical service delivered or issued for delivery in

this state pursuant to this chapter must provide coverage for the

treatment of conditions relating to severe mental illness.

2. The coverage required by this section:

(a) Must provide:

(1) Benefits for at least 40 days of hospitalization as an inpatient

per contract year and 40 visits for treatment as an outpatient per contract

year, excluding visits for the management of medication; and

(2) That two visits for partial or respite care, or a combination

thereof, may be substituted for each 1 day of hospitalization not used by

the insured. In no event is the contract required to provide coverage for

more than 40 days of hospitalization as an inpatient per contract year.

(b) Is not required to provide benefits for psychosocial rehabilitation

or care received as a custodial inpatient.

3. Any deductibles and copayments required to be paid for the

coverage required by this section must not be greater than 150 percent of

the out-of-pocket expenses required to be paid for medical and surgical

benefits provided pursuant to the contract for hospital or medical

services.

4. The provisions of this section do not apply to a contract for

hospital or medical service:

(a) Delivered or issued for delivery to an employer to provide coverage

for his employees if the employer has no more than 25 employees.

(b) If, at the end of the contract year, the premiums charged for that

contract, or a standard grouping of contracts, increase by more than 2

percent as a result of providing the coverage required by this section and

the insurer obtains an exemption from the commissioner pursuant to

subsection 5.

5. To obtain the exemption required by paragraph (b) of subsection

4, an insurer must submit to the commissioner a written request therefor

that is signed by an actuary and sets forth the reasons and actuarial

assumptions upon which the request is based. To determine whether an

exemption may be granted, the commissioner shall subtract from the

amount of premiums charged during the contract year the amount of

premiums charged during the period immediately preceding the contract

year and the amount of any increase in the premiums charged that is

attributable to factors that are unrelated to providing the coverage

required by this section. The commissioner shall verify the information

within 30 days after receiving the request. The request shall be deemed

approved if the commissioner does not deny the request within that time.

6. The provisions of this section do not:

(a) Limit the provision of specialized services covered by Medicaid for

persons with conditions relating to mental health or substance abuse.

(b) Supersede any provision of federal law, any federal or state policy

relating to Medicaid, or the terms and conditions imposed on any

Medicaid waiver granted to this state with respect to the provisions of

services to persons with conditions relating to mental health or substance

abuse.

7. A contract for hospital or medical service subject to the provisions

of this chapter which is delivered, issued for delivery or renewed on or

after January 1, 2000, has the legal effect of including the coverage

required by this section, and any provision of the contract or the renewal

which is in conflict with this section is void, unless the contract is

otherwise exempt from the provisions of this section pursuant to

subsection 4.

8. As used in this section, "severe mental illness" means any of the

following mental illnesses that are biologically based and for which

diagnostic criteria are prescribed in the "Diagnostic and Statistical

Manual of Mental Disorders," Fourth Edition, published by the

American Psychiatric Association:

(a) Schizophrenia.

(b) Schizoaffective disorder.

(c) Bipolar disorder.

(d) Major depressive disorders.

(e) Panic disorder.

(f) Obsessive-compulsive disorder.

Sec. 4. Chapter 695C of NRS is hereby amended by adding thereto a

new section to read as follows:

1. Notwithstanding any provisions of this Title to the contrary, any

evidence of coverage delivered or issued for delivery in this state

pursuant to this chapter must provide coverage for the treatment of

conditions relating to severe mental illness.

2. The coverage required by this section:

(a) Must provide:

(1) Benefits for at least 40 days of hospitalization as an inpatient

per year of coverage and 40 visits for treatment as an outpatient per year

of coverage, excluding visits for the management of medication; and

(2) That two visits for partial or respite care, or a combination

thereof, may be substituted for each 1 day of hospitalization not used by

the insured. In no event is the evidence of coverage required to provide

coverage for more than 40 days of hospitalization as an inpatient per

year of coverage.

(b) Is not required to provide benefits for psychosocial rehabilitation

or care received as a custodial inpatient.

3. Any deductibles and copayments required to be paid for the

coverage required by this section must not be greater than 150 percent of

the out-of-pocket expenses required to be paid for medical and surgical

benefits provided pursuant to the evidence of coverage.

4. The provisions of this section do not apply to any evidence of

coverage:

(a) Delivered or issued for delivery to an employer to provide coverage

for his employees if the employer has no more than 25 employees.

(b) If, at the end of the year for which coverage was provided, the

premiums charged for the evidence of coverage, or a standard grouping

of evidence of coverage, increase by more than 2 percent as a result of

providing the coverage required by this section and the health

maintenance organization obtains an exemption from the commissioner

pursuant to subsection 5.

5. To obtain the exemption required by paragraph (b) of subsection

4, a health maintenance organization must submit to the commissioner a

written request therefor that is signed by an actuary and sets forth the

reasons and actuarial assumptions upon which the request is based. To

determine whether an exemption may be granted, the commissioner shall

subtract from the amount of premiums charged during the year for

which coverage was provided the amount of premiums charged during

the period immediately preceding that year and the amount of any

increase in the premiums charged that is attributable to factors that are

unrelated to providing the coverage required by this section. The

commissioner shall verify the information within 30 days after receiving

the request. The request shall be deemed approved if the commissioner

does not deny the request within that time.

6. The provisions of this section do not:

(a) Limit the provision of specialized services covered by Medicaid for

persons with conditions relating to mental health or substance abuse.

(b) Supersede any provision of federal law, any federal or state policy

relating to Medicaid, or the terms and conditions imposed on any

Medicaid waiver granted to this state with respect to the provisions of

services to persons with conditions relating to mental health or substance

abuse.

7. Any evidence of coverage subject to the provisions of this chapter

which is delivered, issued for delivery or renewed on or after January 1,

2000, has the legal effect of including the coverage required by this

section, and any provision of the evidence of coverage or the renewal

which is in conflict with this section is void, unless the evidence of

coverage is otherwise exempt from the provisions of this section pursuant

to subsection 4.

8. As used in this section, "severe mental illness" means any of the

following mental illnesses that are biologically based and for which

diagnostic criteria are prescribed in the "Diagnostic and Statistical

Manual of Mental Disorders," Fourth Edition, published by the

American Psychiatric Association:

(a) Schizophrenia.

(b) Schizoaffective disorder.

(c) Bipolar disorder.

(d) Major depressive disorders.

(e) Panic disorder.

(f) Obsessive-compulsive disorder.

Sec. 5. NRS 287.010 is hereby amended to read as follows:

  1. 287.010 1. The governing body of any county, school district,
  1. municipal corporation, political subdivision, public corporation or other
  1. public agency of the State of Nevada may:
  1. (a) Adopt and carry into effect a system of group life, accident or health
  1. insurance, or any combination thereof, for the benefit of its officers and
  1. employees, and the dependents of officers and employees who elect to
  1. accept the insurance and who, where necessary, have authorized the
  1. governing body to make deductions from their compensation for the
  1. payment of premiums on the insurance.
  1. (b) Purchase group policies of life, accident or health insurance, or any
  1. combination thereof, for the benefit of such officers and employees, and the
  1. dependents of such officers and employees, as have authorized the
  1. purchase, from insurance companies authorized to transact the business of
  1. such insurance in the State of Nevada, and, where necessary, deduct from
  1. the compensation of officers and employees the premiums upon insurance
  1. and pay the deductions upon the premiums.
  1. (c) Provide group life, accident or health coverage through a self
  1. -insurance reserve fund and, where necessary, deduct contributions to the
  1. maintenance of the fund from the compensation of officers and employees
  1. and pay the deductions into the fund. The money accumulated for this
  1. purpose through deductions from the compensation of officers and
  1. employees and contributions of the governing body must be maintained as
  1. an internal service fund as defined by NRS 354.543. The money must be
  1. deposited in a state or national bank or credit union authorized to transact
  1. business in the State of Nevada. Any independent administrator of a fund
  1. created under this section is subject to the licensing requirements of chapter
  1. 683A of NRS, and must be a resident of this state. Any contract with an
  1. independent administrator must be approved by the commissioner of
  1. insurance as to the reasonableness of administrative charges in relation to
  1. contributions collected and benefits provided. The provisions of NRS
  1. 689B.030 to 689B.050, inclusive, and sections 6 and 7 of [this act]
  1. Assembly Bill No. 60 of this session apply to coverage provided pursuant
  1. to this paragraph [.] , except that the provisions of section 2 of this act do
  1. not apply to such coverage.
  1. (d) Defray part or all of the cost of maintenance of a self-insurance fund
  1. or of the premiums upon insurance. The money for contributions must be
  1. budgeted for in accordance with the laws governing the county, school
  2. district, municipal corporation, political subdivision, public corporation or
  1. other public agency of the State of Nevada.
  1. 2. If a school district offers group insurance to its officers and
  1. employees pursuant to this section, members of the board of trustees of the
  1. school district must not be excluded from participating in the group
  1. insurance. If the amount of the deductions from compensation required to
  1. pay for the group insurance exceeds the compensation to which a trustee is
  1. entitled, the difference must be paid by the trustee.

Sec. 6. Section 35 of Assembly Bill No. 293 of this session is hereby

amended to read as follows:

  1. Sec. 35. [1. This section and sections 1, 2, 4, 6 to 22,
  1. inclusive, 24 to 29, inclusive, 32, 33 and 34 of this act become
  1. effective on July 1, 1999.

2.] Sections 3, 5, 23, 30 and 31 of this act become effective on

October 1, 1999.

Sec. 7. Upon request, an insurer who delivers or issues for delivery a

policy of insurance, contract for hospital or medical service or evidence of

coverage pursuant to chapter 689A, 689B, 695B or 695C of NRS shall

provide to the commissioner of insurance such information as the

commissioner deems necessary to carry out the provisions of subsection 3

of section 9 of this act.

Sec. 8. Sections 1, 2, 4, 6 to 22, inclusive, 24 to 29, inclusive, 32, 33

and 34 of Assembly Bill No. 293 of this session are hereby repealed.

Sec. 9. 1. This section and sections 6 and 8 of this act become

effective upon passage and approval only if the governor has first signed

Assembly Bill No. 293 of this session.

2. Sections 1 to 5, inclusive, and 7 of this act become effective on

January 1, 2000, only if the governor has first signed Assembly Bill No.

293 of this session.

3. The provisions of sections 1 to 5, inclusive, and 7 of this act expire

by limitation on May 1, 2004, if, on January 1, 2003, the commissioner of

insurance issues a determination that the cumulative average increase in

premiums for policies of insurance, contracts for hospital or medical

service and evidence of coverage delivered or issued for delivery pursuant

to chapters 689A, 689B, 695B and 695C of NRS, respectively, that is

directly attributable to coverage for the treatment of conditions relating to

severe mental illness required to be provided by this act is greater than 6

percent.

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