0 ?6 Of?cial Advance Copy SESSION OF 1989 Act 1989?106 755 No. 1989-106 DASPOP 3820 Club Drive AN ACT Harrisburg, PA 17110 HB 1104 . Amending the act of May 17, 1921 (P.L.682, No.284), entitled ?An act relating to insurance; amending, revising, and consolidating the law providing for the incorporation of insurance companies, and the regulation. supervision, and protecrion of home and foreign insurance companies, Lloyds associations. reciprocal and inter-insurance exchanges. and fire insurance rating bureaus, and the regulation and supervision of insurance carried by such companies. associations, and exchanges, including insurance carried by the State Workmen?s Insurance Fund; providing penalties; and repealing existing laws.? further providing for investments; and providing for benefits for drug abuse and dependency. The General Assembly of the Commonwealthof hereby enacts as follows: - Section 1. Sections 517 and 518 of the act of May 17, 1921 (P.L.682, No.284), known as The Insurance Company 1. aw of 1921 are repealed. Section 2. The act is amended by adding sections to read: Section 5188. Investment ny domestic company may invest its funds in sound inves ents as provided in this act and not other- wise. Notwithstanding the prov' bus of this act, the Insurance Commis- sioner may, after notice and heari order a company to limit or withdraw from certain investments, or discont ue certain investment practices, to the extent that the Insurance Commissio er finds that such investments or investment practices are unsound or ay endanger the" solvency of the company. No in vestntent or loan or an i 1,estment practice shall be made or engaged in by any domestic company unle the same has been authorized or rati?ed by the board of directors or by a co ittee thereof charged with the duty of supervising investments and loans. ax, uch company shall subscribe to or participate in any underwriting of the pa hose or sale of securities or property or enter into any agreement to withholit, rom sale any of its prop- erty, but the disposition of its property shall be at times within the control of the board of directors. An agreement or can 1, act providing for the lawful disposition of property wherein such dispositix?n may be determined at the option of a third person at some specr?ed future ,rice or condition or specified time or upon demand shall be construed to be ?thin the control of the board of directors. Nothing contained in this, sectionx?,hall prevent the board of directors of any such company [amt depositing any\ its securities with a committee appointed for the purpose of protecting interest of security holders or?with authorities of any state or country whe it is neces- sary to do so in order to secure permission to transact its appro ness therein; and nothing contained in this section shall prevent the oard of directors of such company from depositing securities as collateral for the securing of any band required for the business of the campany. I insurance company shall invest and keep MW SESSION OF 1989' Act 1989-106 763 within a period of six months after due notice to the company from the Insurance Commissioner to sell and convey the same. The commissioner may extend the time for sue disposition if he believes the interest of the company will suffer materially by forced sale I for the purpose of maintaining or enhancing the sale value of real prope i previously acquired or held by it under subsec~ tion (C) or As an investment for . production of income or capital apprecia? ent, improvement, maintenance or con~ Section 602.1. Eligible Investrnentm with the laws of this Commonwealth rela to the investment of funds of domestic stock fire, stock marine, or- stock 1' and marine insurance compa- nies. Section 6. Sections 603 and 604 or ?the act are pealed. Section 7. The act is amended by adding a secti- to read: Section 604.]. Real Estate Which May Be Ac . ed, Held and Con- veyed. ??No domestic stock casualty insurance company all acquire by pur- chase, lease or otherwise or receive, hold or convey real es e, or. an interest therein, except in accordance with the laws of this Common *alth relating to real estate that may be acquired by purchase, lease or otherw or received, held or conveyed by stock fire, stock marine, or stock fire and . 'ne insur- ance companies. ection 8. Sections 6OI-A, 602-A, 603-A, 605-A and 606-A of the act, added 1986 (P.L.226, No.64), are amended to read: Section 601-A. used in this article the following words and phrases shall have the meanings given to them in this section: ?Alcohol or drug abuse.? Any use of alcohol or other drugs which pro? duces a pattern of pathological use causing impairment in social or occupa- - tional functioning or which produces physiological dependency evidenced by physical'tolerance or withdrawal. or the purposes of this act, ?drugs? shall be defined-as addictive drugs and drugs of abuse listed as scheduled drugs in the act of April 14,1972 (P. L. 233, No.64), known as ?The Controlled Sub- stance, Drug, Device and Cosmetic Act.? ?Detoxification.? The process whereby an alcohol-intoxicated or drug- intoxicated or alcohobdependent or drug-dependent person is assiSted, in a facility licensed by the Department of Health, through the period of time necessary to eliminate, by metabolic or other means, the intoxicating alcohol or other drugs, alcohol and other drug dependency factors or alcohol in com- bination with drugs as determined by a licensed physician, while keeping the physiological risk to the patient at a minimum. ?Hospital.? A facility licensed as a hOSpital by the Department of Health, the Department of Public Welfare, or operated by the Commbn. wealth and conducting an alcoholism or drug addiction treatment program licensed by the Department of Health. 754 Act 1939.106 LAWS OF ?inpatient care.? The provision of medical, nursing, counseling or thero apeutic services twenty-four hours a day in.a hospital, or non-hospital facil- ity, according to individualized treatment plans. . ?Non-hospital facility." A facility, licensed by the' Department of Health, for the care or treatment of alcohol-dependent or other drug-depen- dent persons, except for transitional living facilities. ?Non-hospital residential care.? The provision of medical, nursing, counseling or therapeutic services to patients suffering from alcohol or other drug abuse or'dependency in a residential environment, according to individ- ualized treatment plans. . ?Outpatient care.? The provision of medical, nursing, counseling or therapeutic services in a hospital or non-hospital facility on a regular and predetermined schedule, according to individualized treatment plans. ?Partial hospitalization." The provision of medical. nursing, counseling or therapeutic services on a planned and regularly scheduled basis in a hospi-, tal or non-hospital facility licensed as an alcoholism or drug addiction treat- ment program by the Department of Health, designed for a patient or client who would benefit from more intensive than are offered in outpatient treat- ment but who does not require inpatient care. .Section 602-A. Mandated Policy Coverages and All group health or sickness or accident insurance policies providing hospital or medical/surgical coverage and all group subscriber contracts or certi?cates issued by any entity subject to this act. 40 Ch. 61 (relating to hospi- tal plan corporations) or Ch. 63 (relating to professional health services plan corporations), the act of December 29, 1972 No.364), known as the ?Health Maintenance Organization Act," or the act of July 29, 1977 No.38), known as the ?Fraternal Benefit Society Code,? provid- ing hospital or medical/surgical coverage, shall in addition to other provi- sions'required by this act include within the coverage those bene?ts for alcohol or other drug abuse and dependency as provided in sections and GOS-A. The bene?ts speci?ed in subsection may be provided through a combination of such policies, contracts or certi?cates. The bene?ts speci?ed in subsection may be provided through pro- spective payment plans. The provisions of subsection shall not apply to Medicare or Medi- caid supplemental contracts or limited coverage accident and sickness poli- . cis, such as, but not limited to, cancer insurance, polio insurance, dental care and similar policies as may be identi?ed as exempt from this section by the insurance Commissioner. Section 603-A. Inpatient inpatient detbxi?cation as a covered bene?t under this article shall be provided either ina hospital-or in an inpatient non-hospital facility which has a written af?liation agreement with a hospital for emergency, medical and or support services, meets minimum standards for client-to-staff ratios and staff quali?cations which shall be (established by the Department of Health and is licensed as an alcoholismand/or drug addiction treatment program. I SESSION OF 1989 Am 1989406 765 . The following services shall be covered under inpatient detoxi?ca- tion: (1) Lodging anddietary services. (2) Physician, nurse, certi?ed addictions counselor and trained staff services. (3) Diagnostic X-ray. (4) and medical laboratory testing. (5) Dru-gs, medicines, equipment use and supplies. Treatment under this section may be subject to a lifetime'limit, for any covered individual, of four admissions fordetoxification and reimburse~ ment per admission may be limited to seven (7) days of treatment or an equivalent amount. . . . Section 604-A. Non?hospital Residential Alcoholor Other Drug Ser~ Minimal additional treatment as a covered bene?t under this article shall be provided in a facility which meets minimum standards for client-to~staff ratios and staff quali?cations which shall be established by the Of?ce of Drug and Alcohol Programs and is appropriately licensed by the Department of Health as an alcoholism or drug addiction treatment program. Before an insured may qualify to receive bene?ts under this seetion, a licensed physician or licensed must certify the insured as a person suffering from alcohol or other drug abuse or dependency and refer the insured for the appropriate treatment. The following services shall be covered under this section: (1) Lodging and dietary services. . A (2) Physician, nurse, certi?ed addictions counselor and trained staff services. (3) Rehabilitation therapy and counseling. (4) Family'counseling and intervention. (5) and medical laboratory tests. (6) Drugs, medicines, equipment use and supplies. . The treatment under this section shall be covered, as required by this act, for a minimum of thirty (30) days per year for residential care. Addi~ tional days shall be available as provided in section Treatment may besubject to a lifetime limit, for any covered individual, of ninety (90) days. - . .Section 605-A. Outpatient Alcohol or Other. 011;; Services-- Minimal additional treatment as a covered benefit under this article shall be provided in a facility appropriately licensed by the Department of Health as an alcoholism or drug addiction treatment program. Before an insured may qualify to receive bene?ts under this section, a licensed physi- cian or licensed must certify the insured as a person suffering from alcohol or other drug abuse or dependency and refer the insured for the appropriate treatment. The following services shall be covered under this section: - (1) Physician, nurse, certi?ed addictions counselor and trained staff services. 765 Act 1989-106 . LAWS OF (2) Rehabilitation therapy and counseling. (3) Family counseling and intervention (4) and medical laboratory tests. (5) Drugs, medicines, equipment use and supplies. Treatment under this section shall be covered as required by this act fora minimum of thirty outpatient, full~session visits or equivalent partial visits per year. Treatment may be subject to a lifetime limit, for any covered individual, of one hundred and twenty outpatient, full-session visits or equivalent partial visits. In addition, treatment under this section shall be covered as required bythis?act for a minimum of thirty separate sessions of outpatient or partial hospitalization services per year, which may be exchanged on a two-twne basis to secure up to ?fteen additional non-hospital, residential alcohol treat- ment days. Section 606-A. Deductibles, Copayment Plans and Prospective Pay. Reasonable deductible or copayment plans, or both, after approval by the Insurance Commissioner, may be applied to benefits paid to or on behalf of patients during the course of alcohol or other drug abuse or dependency ., treatment. In the ?rst instance or course of treatment, no deductible or copayment shall be less favorable than those applied to similar classes or cat- egories of treatment for physical illness generally in each policy. In the first instance or course of treatment under a prospective payment plan, no deductible or copayment shall be less favorable than those applied to similar classes or categories of treatment for physical illness gener. ally' in each policy. . WSection 9. Section 802 of the act is repealed. Section 10. The act is amended by adding a section to read: Section 802.1. Investment of Assets. ?Every domestic mutual insurance company, other than a mutual life insurance company, shall invest and keep invested ad its funds in accordance with the laws of this Commonwealth relating to the investment of funds of domeStic stock fire, stock marine, or stock fire and marine insurance compania. Provided, however; That any mutual insurance company which does not possess a certificate of authority to issue nonassessable insurance policies shall be permitted to invest its funds . in assets speci?ed In subsection (6). (7). (8). (9). (10). (11) and (12) of section 518C only after obtaining prior written approval of- the Insurance Commissioner. Section ll. Section 803 of the act is repealed. XX, Section 12. The act is amended by adding sections to read: Section 303.1. Real 5mm Which May Be Acquired Held and Con- veyed.?A domestic mutual insurance company, other a mutual life irrsurance company, may acquire by purchase, lease or oth or receive, hold or convey real estate, or any interest therein, in accord .ce with the laws of this Commonwealth relating to real estate that may be . purchase, lease or otherwise or received, held or conveyed by stock marine, or stock ?re and marine insurance companies. Mu insur- ance compmles which do not possess a certificate of authority to issue non- 753 Act 1989-106 LAWS or or receive information relating to suspected fraudulent insurance activities; creating a task force to conduct a review of various factors used in determin- ing automobile insurance premiums; and making an appropriation,? is repealed. . Section 16. This act shall take effect as follows: (1) The amendments in section 8 shall take effect in 90 days. (2) .The remaining provisions shall take effect immediately. . 22nd day of December, A. D. 1989. ROBERT P. CASEY