IL| The Illinois Department of Insurance Issues Bulletin 2025-12, warning health insurers and utilization review organizations against denying claims or excluding coverage based on the location, site of care, or setting of medically necessary services, unless such determinations are grounded in generally accepted standards of care—not for economic benefit or convenience. Effective January 1, 2026, utilization review criteria for medical necessity must come from statutorily permitted, standardized sources to prevent use of custom or economically motivated criteria. PPO and indemnity plans must not restrict insureds to specific hospital networks or geographic areas, and must allow benefit access to out-of-network providers (with higher cost-sharing if applicable), in compliance with Illinois Insurance Code provisions prohibiting unjust or misleading policy limitations.
Main Points:
- Medical necessity denials based solely on site of care or location, without evidence from generally accepted standards of care, are improper and may violate Illinois law.
- Starting January 1, 2026, utilization review criteria used to determine medical necessity for medical and surgical services must only come from approved, standardized sources, not proprietary or economically driven guidelines.
- PPO and indemnity policies must permit insureds to access benefits at any qualified provider, not restrict them to networks or geographic zones, and cannot contain exclusions or limitations that unjustly restrict coverage or misrepresent benefits.