TRANSPARENCY IN DOWNCODING ACT

Creates the Transparency in Downcoding Act. Provides that, subject to federal requirements, the Act applies to certain policies of health insurance amended, delivered, issued, or renewed on or after the effective date of the Act, except for employee or employer self-insured health benefit plans under the federal Employee Retirement Income Security Act of 1974 and health care provided pursuant to the Workers' Compensation Act or the Workers' Occupational Diseases Act. Prohibits home rule units from regulating downcoding of medical claims in policies issued, amended, delivered, or renewed on or after January 1, 2028. Prohibits a health care payor from implementing any policy or using any algorithm or other automated process, system, or tool that bypasses the evaluation of all information included by the billing health care professional to downcode a claim. Provides that a health care payor may use an automated process to identify claims that may justify a downcoding determination. Provides that all downcoding determinations must be made or reviewed by a natural person following American Medical Association Current Procedural Terminology coding guidelines in effect at the time. Prohibits a health care payor from downcoding a claim based solely on the reported diagnosis codes. Sets forth provisions concerning notification requirements and the dispute process for downcoded claims. Prohibits a health care payor from using downcoding practices in a targeted or discriminatory manner against health care professionals who routinely treat patients with complex or chronic conditions. Establishes administration and enforcement provisions. Amends the Illinois Public Aid Code. Provides that, notwithstanding any other provision of law to the contrary, all managed care organizations shall comply with the requirements of the Transparency in Downcoding Act. Effective January 1, 2028.

Status

Passed

Signed or otherwise enacted

Status date

Jul 10, 2026

125 days ago

Current chamber

Senate

Session

2025-2026 Regular Session