2019-06-05T15:22:23-05:00 2018-12-31 381357951 PLANTE & MORAN PLLC 10 S RIVERSIDE PLAZA 9TH FLOOR CHICAGO IL 60606 990 2018-01-01 363117539 ILLINOIS LIFE AND HEALTH INSURANCE GUARANTY ASSOCIATION ILLI 7734444072 901 WARRENVILLE ROAD SUITE 400 LISLE IL 60532 JANIS POTTER EXECUTIVE DIRECTOR 7734444072 2019-06-03 1 LU ANN TRAPP P01506476 3122071040 2019-06-03 69.136.173.86 2019-06-03 16:11:29 CD P 15AFACDE74AD926CF7DD083ABD650856FF519615 BC3C601473DBFA21F2EC98090FDE5B85B06AE70F 2018 2019-02-21 02:37:17Z X JANIS POTTER 901 WARRENVILLE ROAD SUITE 400 LISLE IL 60532 32191148 0 X WWW.ILHIGA.ORG X 1980 IL THE ASSOCIATION WAS ORGANIZED IN 1980 UNDER CHAPTER 215, ARTICLE XXXIII-I12 OF THE ILLINOIS INSURANCE CODE (THE "ACT") TO ASSURE THE FULFILLMENT OF COVERED POLICY OBLIGATIONS OF MEMBER INSURERS THAT ARE DETERMINED TO BE INSOLVENT BY A STATE DIRECTOR OF INSURANCE OR OTHER APPROPRIATE AUTHORITY. 10 10 9 10 0 0 0 0 78105864 31182287 688704 1008861 0 0 78794568 32191148 0 0 0 0 721004 1048271 0 0 0 57101676 16842254 57822680 17890525 20971888 14300623 55681896 71881342 11969946 13831270 43711950 58050072 X SEE SCHEDULE O 1 0 TOTAL EXPENSES DURING 2018 WERE $17.89 MILLION, OF WHICH $12.89 MILLION WAS PAID TO OR ON BEHALF OF POLICYHOLDERS AND $.75 MILLION WAS PAID TO THIRD PARTY ADMINISTRATORS. REVENUE DURING 2018 TOTALED $32.19 MILLION OF WHICH $22.65 MILLION WERE CLASS B ASSESSMENTS, $3.34 MILLION WERE DISTRIBUTIONS FROM THE RECEIVER, $5.19 MILLION WERE PREMIUMS AND $1.01 MILLION WAS NET INVESTMENT INCOME. 0 0 0 0 0 0 0 0 0 1 0 0 0 1 1 1 0 0 0 0 0 0 0 0 0 0 0 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 484 0 1 9 1 0 0 0 0 0 0 0 0 X 10 10 0 0 0 0 1 1 1 1 1 0 0 1 1 1 1 1 1 1 0 0 X JANIS D POTTER 7734444072 901 WARRENVILLE ROAD SUITE 400 LISLE IL 60532 KENNETH ULRICH DOI APPOINTEE 1.00 0.00 X 0 0 0 AETNA LIFE INSURANCE COMPANY DIRECTOR 1.00 0.00 X 0 0 0 COUNTRY LIFE INSURANCE COMPANY DIRECTOR 1.00 0.00 X 0 0 0 HEALTH CARE SERVICE CORPORATION DIRECTOR 1.00 0.00 X 0 0 0 NORTHWESTERN MUTUAL LIFE INSURANCE CO DIRECTOR 1.00 0.00 X 0 0 0 PRINCIPAL LIFE INSURANCE COMPANY DIRECTOR 1.00 0.00 X 0 0 0 PRUDENTIAL INSURANCE CO OF AMERICA DIRECTOR 1.00 0.00 X 0 0 0 STATE FARM LIFE INSURANCE COMPANY DIRECTOR 1.00 0.00 X 0 0 0 TRUSTMARK INSURANCE COMPANY DIRECTOR 1.00 0.00 X 0 0 0 UNITEDHEALTHCARE INSURANCE COMPANY OF DIRECTOR 1.00 0.00 X 0 0 0 ALLSTATE LIFE INSURANCE COMPANY DIRECTOR 1.00 0.00 X 0 0 0 KELVIN SCHILL CHAIR 1.00 0.00 X 0 0 0 JILL WOLOWITZ VICE CAIR 1.00 0.00 X 0 0 0 LEONARD KARPOWICH SECRETARY/TREASURER 1.00 0.00 X 0 0 0 JANIS POTTER EXECUTIVE DIRECTOR 40.00 0.00 X 266468 0 42649 LILLIAN CILANO CONTROLLER 40.00 0.00 X 105310 0 13527 371778 0 56176 2 0 1 0 LEWIS ROCA ROTHGERBER CHRISTIE LLP 1200 SEVENTEENTH STREET SUITE 3000 DENVER CO 80202 LEGAL SERVICES 1078387 EVOLENT HEALTH LLC 800 N GLEBE ROAD SUITE 500 ARLINGTON VA 22203 TPA SERVICES 151750 2 ASSESSMENTS 524298 22651263 22651263 PREMIUMS 524298 5190951 5190951 ESTATE RECOVERIES 524298 3340073 3340073 31182287 1008861 1008861 32191148 31182287 0 1008861 309117 507717 25636 150408 55393 1241526 39532 50403 291455 123356 165917 109438 51967 1259 14023 63182 BENEFITS TO POLICY HOLD 12893808 EXPENSES PAID TO NOLHGA 939321 THIRD PARTY ADMINISTRAT 748304 EQUIPMENT MAINTENANCE 22899 85864 17890525 2450633 -96262 3956148 4094831 9950 9362 58704 54405 229839 193876 17455 35963 44478550 67568442 4710456 214601 55681896 71881342 60087 209533 11909859 13621737 11969946 13831270 X 1039891 318231 42672059 57731841 43711950 58050072 55681896 71881342 X 14300623 -301738 339235 X X 0 1 X 1 0 229839 193876 35963 35963 RESERVE FOR CLOSED/NON-ACTIVATED 13534757 ASSESSMENT SUSPENSE 18380 DEFERRED RENT 68600 13621737 X 15761 0 15761 32175387 32175387 32191148 806845 0 806845 17083679 17083679 17890524 PART X, LINE 2: MANAGEMENT EVALUATES THE ASSOCIATION'S EXPOSURE FOR UNCERTAIN TAX POSITIONS AT EACH REPORTING PERIOD. AS OF DECEMBER 31, 2018, MANAGEMENT BELIEVES THE ASSOCIATION HAS NO MATERIAL UNCERTAIN TAX POSITIONS, AND, THEREFORE, NO SUCH LIABILITIES HAVE BEEN RECORDED. THE ASSOCIATION WOULD ACCOUNT FOR ANY POTENTIAL INTEREST OR PENALTIES RELATED TO POSSIBLE FUTURE LIABILITIES FOR UNRECOGNIZED INCOME TAX BENEFITS AS INCOME TAX EXPENSE. PART XI, LINE 4B - OTHER ADJUSTMENTS: REVENUE FROM INSOLVENT ESTATES AND INTERCOMPANY ADJUSTMENTS 32,175,387. PART XII, LINE 4B - OTHER ADJUSTMENTS: EXPENSES FROM INSOLVENT ESTATES AND INTERCOMPANY ADJUSTMENTS 17,083,679. X X X X X 0 0 0 JANIS POTTER EXECUTIVE DIRECTOR 197200 0 35000 0 34268 0 30081 0 12568 0 309117 0 0 0 FORM 990, PART III, LINE 1 - ORGANIZATION'S MISSION THE PURPOSE OF THE ASSOCIATION, AS DEFINED IN CHAPTER 215, ARTICLE XXXIII-I12 OF THE ILLINOIS INSURANCE CODE (THE "ACT"), IS TO PROTECT ILLINOIS RESIDENT POLICYHOLDERS, ENROLLEES AND THEIR BENEFICIARIES, ASSIGNEES AND PAYEES COVERED BY THE ACT IN THE EVENT OF THE INSOLVENCY OF A MEMBER INSURER BY THE PAYMENT OF BENEFITS OR CONTINUATION OF COVERAGE, SUBJECT TO CERTAIN STATUTORY LIMITATIONS. ON AUGUST 3, 2018, THE ILLINOIS GOVERNOR SIGNED INTO LAW HOUSE BILL 5251 WHICH, AMONG OTHER THINGS, HAD THE EFFECT OF MERGING THE ILLINOIS HEALTH MAINTENANCE ORGANIZATION GUARANTY ASSOCIATION WITH AND INTO THE ILLINOIS LIFE AND HEALTH INSURANCE GUARANTY ASSOCIATION. THUS,THE ILLINOIS LIFE AND HEALTH INSURANCE GUARANTY ASSOCIATION IS THE SUCCESSOR TO THE ILLINOIS HEALTH MAINTENANCE ORGANIZATION GUARANTY ASSOCIATION AS OF AUGUST 3, 2018, SUBJECT TO THE PROVISIONS OF HOUSE BILL 5251. AS A RESULT, HEALTH MAINTENANCE ORGANIZATIONS HAVE BEEN ADDED AS MEMBER INSURERS OF THE ILLINOIS LIFE AND HEALTH INSURANCE GUARANTY ASSOCIATION AND THEIR ENROLLEES, INCLUDING THE ENROLLEES' ASSIGNEES, PAYEES AND BENEFICIARIES, ARE NOW PROTECTED BY THE ILLINOIS LIFE AND HEALTH INSURANCE GUARANTY ASSOCIATION, SUBJECT TO THE PROVISIONS OF THE ACT. FORM 990, PART III, LINE 2 HOUSE BILL 5251 WAS SIGNED INTO LAW BY GOVERNOR RAUNER ON AUGUST 3, 2018. THE BILL PROVIDED FOR NUMEROUS AMENDMENTS TO THE ILLINOIS LIFE AND HEALTH INSURANCE GUARANTY ASSOCIATION ACT (THE "ACT") TO CONFORM WITH A NEW NAIC MODEL ACT ADOPTED BY THE NAIC IN LATE 2017. AMONG OTHER THINGS, HOUSE BILL 5251 PROVIDED THAT, IMMEDIATELY UPON ITS PASSAGE AND SIGNATURE INTO LAW, THE ILLINOIS LIFE AND HEALTH INSURANCE GUARANTY ASSOCIATION (THE "ASSOCIATION") AND THE ILLINOIS HEALTH MAINTENANCE ORGANIZATION ASSOCIATION (IHMOGA) BE MERGED INTO A SINGLE ASSOCIATION. EFFECTIVE AUGUST 3, 2018, THE IHMOGA, BY OPERATION OF LAW, MERGED WITH AND INTO THE ASSOCIATION, SUCH THAT THE ILLINOIS LIFE AND HEALTH INSURANCE GUARANTY ASSOCIATION IS THE SURVIVING ASSOCIATION OF THE MERGER. AT THE EFFECTIVE TIME OF THE MERGER, THE IHMOGA CEASED TO EXIST SEPARATELY AND ALL ASSETS AND LIABILITIES WERE TRANSFERRED TO THE ASSOCIATION SUBJECT TO PROVISIONS OF HOUSE BILL 5251. FORM 990, PART VI, SECTION A, LINE 6 UNDER ILLINOIS STATUTE, ALL INSURANCE COMPANIES AND HEALTH MAINTENANCE ORGANIZATIONS WHICH ARE LICENSED TO WRITE LIFE INSURANCE POLICIES, HEALTH INSURANCE POLICIES, HEALTH BENEFIT PLANS, ANNUITY CONTRACTS, UNALLOCATED ANNUITY CONTRACTS AND CONTRACTS SUPPLEMENTAL THERETO ARE REQUIRED TO BE MEMBER INSURERS OF THE ASSOCIATION. FORM 990, PART VI, SECTION A, LINE 7A THE MEMBER INSURERS ELECT SEVEN TO NINE MEMBER INSURERS TO BE REPRESENTED ON THE ASSOCIATION'S BOARD OF DIRECTORS. PER STATUTE, THE DIRECTOR OF THE ILLINOIS DEPARTMENT OF INSURANCE MAY APPOINT TWO PUBLIC REPRESENTATIVES TO THE BOARD OF DIRECTORS. CURRENTLY THE DIRECTOR HAS APPOINTED ONE PUBLIC MEMBER TO THE ASSOCIATION'S BOARD OF DIRECTORS. FORM 990, PART VI, SECTION A, LINE 7B ALL CHANGES TO THE ASSOCIATION'S PLAN OF OPERATION ARE SUBJECT TO APPROVAL BY THE ILLINOIS INSURANCE DEPARTMENT DIRECTOR OF INSURANCE. THE PLAN OF OPERATION WAS UPDATED AND APPROVED BY THE DIRECTOR OF THE ILLINOIS DEPARTMENT OF INSURANCE IN OCTOBER 2018. FORM 990, PART VI, SECTION B, LINE 11B THE FORM 990 SUPPORTING INFORMATION IS PREPARED BY THE ASSOCIATION'S CONTROLLER AND REVIEWED BY THE EXECUTIVE DIRECTOR. THE FORM 990 IS THEN PREPARED BY THE ASSOCIATION'S INDEPENDENT, EXTERNAL TAX PROFESSIONAL AND SUGGESTIONS/COMMENTS ARE TAKEN INTO CONSIDERATION BY THE ASSOCIATION'S CONTROLLER. MANAGEMENT PRESENTS THE FORM 990 TO THE FULL BOARD OF DIRECTORS FOR REVIEW AND APPROVAL. ONCE APPROVED BY THE BOARD OF DIRECTORS, THE FORM 990 IS SIGNED BY THE EXECUTIVE DIRECTOR AND FILED. FORM 990, PART VI, SECTION B, LINE 12C THE ASSOCIATION'S EXECUTIVE DIRECTOR IS RESPONSIBLE FOR ENSURING THAT THE ASSOCIATION'S CONFLICT OF INTEREST AND BUSINESS ETHICS POLICY IS DELIVERED AND COMMUNICATED TO ALL "ASSOCIATION PERSONNEL", WHICH INCLUDES THE EXECUTIVE DIRECTOR, THE BOARD OF DIRECTORS, EMPLOYEES, INDEPENDENT CONTRACTORS, LEGAL COUNSEL AND CONSULTANTS. PRIOR TO EACH ANNUAL MEETING, ALL ASSOCIATION PERSONNEL COMPLETE A CONFLICT OF INTEREST QUESTIONNAIRE. THESE QUESTIONNAIRES ARE THEN REVIEWED BY THE EXECUTIVE DIRECTOR. THE EXECUTIVE DIRECTOR THEN FORWARDS THESE QUESTIONNAIRES AND HER RECOMMENDATIONS TO THE ASSOCIATION'S GENERAL COUNSEL AND THE BOARD CHAIR. THE BOARD OF DIRECTORS HAS THE SOLE AUTHORITY TO DETERMINE WHETHER A CONFLICT OF INTEREST EXISTS. FORM 990, PART VI, SECTION B, LINE 15A COMPENSATION OF THE EXECUTIVE DIRECTOR IS REVIEWED AND APPROVED BY THE EXECUTIVE COMMITTEE OF THE BOARD OF DIRECTORS. FORM 990, PART VI, LINE 15B - COMPENSATION PROCESS FOR OTHER OFFICERS/KEY EMPLOYEES: A MORE ACCURATE ANSWER IS N/A AS THERE IS NO OTHER OFFICERS/KEY EMPLOYEES. FORM 990, PART VI, SECTION C, LINE 19 PER THE ASSOCIATION'S PUBLIC RECORDS POLICY, ALL PERSONS ARE ENTITLED TO ACCESS THE PUBLIC RECORDS OF THE ASSOCIATION. THIS INCLUDES THE ASSOCIATION'S GOVERNANCE POLICIES, INCLUDING THE CONFLICT OF INTEREST AND BUSINESS ETHICS POLICY, AND FINANCIAL STATEMENTS. SUCH INFORMATION IS MADE AVAILABLE TO THE PUBLIC UPON REQUEST. FORM 990, PART XI, LINE 9: IHMOGA ACQUISITION - EXCESS OF ASSETS OVER LIABILITIES 69,424. NET TRANSFERS (TO) FROM THE RESERVE -244,245. PRIOR YEAR CHANGE IN UNREALIZED GAINS(LOSSES) 514,056. FORM 990, PART XII, LINE 2C - FINANCIAL REVIEW PROCESS THE FINANCIAL STATMENTS OF THE ASSOCIATION ARE AUDITED ANNUALLY BY AN INDEPENDENT EXTERNAL AUDIT FIRM. THE AUDITED FINANCIAL STATEMENTS ARE PRESENTED TO THE AUDIT/FINANCE/INVESTMENT COMMITTEE FOR REVIEW AND APPROVAL. THE AUDIT/FINANCE/INVESTMENT COMMITTEE THEN PRESENTS THE AUDITED FINANCIAL STATEMENTS TO THE FULL BOARD OF DIRECTORS FOR REVIEW AND APPROVAL. FORM 990, PART IV, LINE 34 UNDER PUBLISHED INSTRUCTIONS FOR THE FORM 990 AND SCHEDULE R, THE FILING ORGANIZATION DOES NOT BELIEVE THAT ANY RELATIONSHIP WITH RELATED ORGANIZATIONS EXIST. HOWEVER, FOR TRANSPARENCY AND INFORMATION PURPOSES, THE FOLLOWING DESCRIPTION OF AN ENTITY SHARING A COMMON OFFICER, DIRECTOR REPRESENTATIVE, EXECUTIVE DIRECTOR AND EXPENSE SHARING IS PROVIDED. UNTIL AUGUST 3, 2018, THE ILLINOIS LIFE AND HEALTH INSURANCE GUARANTY ASSOCIATION ("ILHIGA") AND THE ILLINOIS HEALTH MAINTENANCE ORGANIZATION GUARANTY ASSOCIATION ("IHMOGA") SHARED A COMMON OFFICER AND DIRECTOR REPRESENTATIVE. ALSO, THE EXECUTIVE DIRECTOR, JANIS POTTER, WAS THE EXECUTIVE DIRECTOR OF ILHIGA AND IHMOGA. IHMOGA WAS ALSO A 501(C)(6) ORGANIZATION, (TID #**-***6114). EACH ASSOCIATION WAS ORGANIZED AND GOVERNED BY CHAPTER 215 OF THE ILLINOIS INSURANCE CODE. THE EXECUTIVE DIRECTOR HAD TWO EMPLOYMENT CONTRACTS; ONE WITH ILHIGA AND ANOTHER WITH IHMOGA. ILHIGA AND IHMOGA SHARED OFFICE FACILITY AND OVERHEAD EXPENSES. IHMOGA REIMBURSED ILHIGA FOR ACTUAL TIME CHARGED BY ILHIGA STAFF AND ITS SHARE OF OFFICE FACILITY AND OVERHEAD CHARGES BASED UPON ALLOCATION PERCENTAGES APPROVED BY THE RESPECTIVE BOARDS.