Chapter 601

601.42 601.42 Reports and replies.

601.42(1g) (1g) Reports. The commissioner may require any of the following from any person subject to regulation under chs. 600 to 655:

601.42(1g)(a) (a) Statements, reports, answers to questionnaires and other information, and evidence thereof, in whatever reasonable form the commissioner designates, and at such reasonable intervals as the commissioner chooses, or from time to time.

601.42(1g)(b) (b) Full explanation of the programming of any data storage or communication system in use.

601.42(1g)(c) (c) That information from any books, records, electronic data processing systems, computers or any other information storage system be made available to the commissioner at any reasonable time and in any reasonable manner.

601.42(1g)(d) (d) Statements, reports, answers to questionnaires or other information, or reports, audits or certification from a certified public accountant or an actuary approved by the commissioner, relating to the extent liabilities of a health maintenance organization insurer are or will be liabilities for health care costs for which an enrollee or policyholder of the health maintenance organization is not liable to any person under s. 609.91.

601.42(1r) (1r) Reports by individual practice associations. The commissioner may by rule require that an individual practice association submit to the commissioner information reasonably necessary to determine the financial condition of the individual practice association. The information required under this subsection may include, but is not limited to, financial statements of the individual practice association, except the commissioner may not require members of the individual practice association or other health care providers who contract with the individual practice association to submit individual financial statements.

601.42(2) (2) Forms. The commissioner may prescribe forms for the reports under subs. (1g) and (1r) and specify who shall execute or certify such reports. The forms for the reports required under sub. (1g) shall be consistent, so far as practicable, with those prescribed by other jurisdictions.

601.42(3) (3) Accounting methods. The commissioner may prescribe reasonable minimum standards and techniques of accounting and data handling to ensure that timely and reliable information will exist and will be available to the commissioner.

601.42(4) (4) Replies. Any officer, manager or general agent of any insurer authorized to do or doing an insurance business in this state, any person controlling or having a contract under which the person has a right to control such an insurer, whether exclusively or otherwise, any person with executive authority over or in charge of any segment of such an insurer’s affairs, any individual practice association or officer, director or manager of an individual practice association, any insurance agent or other person licensed under chs. 600 to 646, any provider of services under a continuing care contract, as defined in s. 647.01 (2), any independent review organization certified or recertified under s. 632.835 (4) or any health care provider, as defined in s. 655.001 (8), shall reply promptly in writing or in other designated form, to any written inquiry from the commissioner requesting a reply.

601.42(5) (5) Verification. The commissioner may require that any communication made to the commissioner under this section be verified.

601.42(6) (6) Immunity.

601.42(6)(a) (a) In the absence of actual malice, no communication to the commissioner required by law or by the commissioner shall subject the person making it to an action for damages for defamation. This paragraph applies to communications received by the commissioner before May 11, 1990, or on or after June 1, 1994.

601.42(6)(b) (b) In the absence of actual malice, no communication to the commissioner or office required by law or by the commissioner shall subject the person making it to an action for damages for the communication. This paragraph applies to communications received by the commissioner or office on or after May 11, 1990, and before June 1, 1994.

601.42(7) (7) Experts. The commissioner may employ experts to assist the commissioner in an examination or in the review of any transaction subject to approval under chs. 600 to 646. The person that is the subject of the examination, or that is a party to a transaction under review, including the person acquiring, controlling or attempting to acquire the insurer, shall pay the reasonable costs incurred by the commissioner for the expert and related expenses.

601.42 History History: 1977 c. 339 s. 43; 1979 c. 89; 1979 c. 102 ss. 69, 236 (8), (21); 1979 c. 177; 1983 a. 358 ss. 9, 14; 1987 a. 247; 1989 a. 23; 1989 a. 187 ss. 1m, 29; 1989 a. 332; 1991 a. 316; 1997 a. 237; 1999 a. 30, 155.

601.42 Cross-reference Cross-reference: See also s. 623.02 as to standards for accounting rules.

601.42 Cross-reference Cross-reference: See also ss. Ins 6.61, 6.62, and 6.63, Wis. adm. code.

601.423 601.423 Social and financial impact reports.

601.423(1) (1) Definition. In this section, “health insurance mandate” means a statute of this state that does any of the following:

601.423(1)(am) (am) Requires an insurance policy, plan, or contract to do any of the following:

601.423(1)(am)1. 1. Permit a person insured under the policy, plan or contract to obtain treatment or services from a particular type of health care provider, including, but not limited to, requiring a health maintenance organization, preferred provider plan, limited service health organization or other plan to select a particular type of health care provider for participation in the plan.

601.423(1)(am)2. 2. Provide coverage for the treatment of a particular disease, condition or other health care need.

601.423(1)(am)3. 3. Provide coverage of a particular type of health care treatment or service, or of equipment, supplies or drugs used in connection with a health care treatment or service.

601.423(1)(am)4. 4. Provide coverage for particular persons because of their relation to the insured or legal status with respect to the insured, or for any other reason.

601.423(1)(bm) (bm) Requires a particular benefit design or imposes conditions on cost sharing under an insurance policy, plan, or contract for the treatment of a particular disease, condition, or other health care need, for a particular type of health care treatment or service, or for the provision of equipment, supplies, or drugs used in connection with a health care treatment or service.

601.423(1)(cm) (cm) Imposes limits or conditions on a contract between an insurer and a health care provider, as defined in s. 146.81 (1).

601.423(2) (2) Preparation of report.

601.423(2)(a) (a) Subject to par. (b), the office shall submit a report on the social and financial impact of any health insurance mandate contained in any bill or amendment affecting an insurance policy, plan, or contract, or, if the office decides not to submit a report, a written statement explaining the reason for not preparing the report, to the chief clerk of the house of the legislature in which the bill or amendment is introduced or offered.

601.423(2)(b) (b)

601.423(2)(b)1. 1. The office shall submit the report or written statement for a bill within 10 working days after receiving the copy of the bill from the legislative reference bureau under s. 13.0966 (2) (b).

601.423(2)(b)2. 2. The office shall submit the report or written statement within 10 working days after receiving a copy of the amendment from the legislative reference bureau under s. 13.0966 (2) (b). The office is not required to prepare or submit a report or written statement for an amendment if, by the end of the next business day after receiving a copy of the amendment from the legislative reference bureau, the amendment has failed adoption or failed to be reported out of committee.

601.423(3) (3) Contents of report.

601.423(3)(a) (a) Social impact factors. Any report prepared under sub. (2) shall assess to the extent possible all of the following social impact factors that are relevant to the type of health insurance mandate created, expanded, or continued by the bill or amendment:

601.423(3)(a)1. 1. The portion of this state’s residents who use the treatments or services covered by the health insurance mandate.

601.423(3)(a)2. 2. The extent to which individuals under subd. 1. use these treatments or services.

601.423(3)(a)3. 3. The availability of insurance coverage for these treatments or services.

601.423(3)(a)4. 4. The number of persons who would be eligible for coverage under the health insurance mandate, and the availability of insurance coverage for these persons without the health insurance mandate.

601.423(3)(b) (b) Financial impact factors. Any report prepared under sub. (2) shall assess to the extent possible all of the following financial impact factors that are relevant to the type of health insurance mandate created, expanded, or continued by the bill or amendment:

601.423(3)(b)1. 1. Whether the health insurance mandate may increase or decrease the costs of the treatments or services covered by the health insurance mandate.

601.423(3)(b)2. 2. Whether the health insurance mandate would increase the use of the treatments or services covered by the health insurance mandate.

601.423(3)(b)3. 3. Whether any increased use under subd. 2. would substitute for more expensive treatments or services.

601.423(3)(b)4. 4. The impact of the health insurance mandate on total costs of health care in this state.

601.423(3)(b)5. 5. Whether the health insurance mandate may increase the administrative costs to insurance companies and the premium costs to policyholders.

601.423 History History: 1987 a. 177; 2015 a. 288; 2017 a. 239.

601.43 601.43 Examinations and alternatives.

601.43(1) (1) Power to examine.

601.43(1)(a) (a) Insurers, other licensees and other persons subject to regulation. Whenever the commissioner deems it necessary in order to inform himself or herself about any matter related to the enforcement of chs. 600 to 647, the commissioner may examine the affairs and condition of any licensee, registrant, or permittee under chs. 600 to 647 or applicant for a license, registration, or permit, of any person or organization of persons doing or in process of organizing to do an insurance business in this state, of any public adjuster, as defined in s. 629.01 (5), and of any advisory organization serving any of the foregoing in this state.

601.43(1)(b) (b) Collateral examinations. So far as reasonably necessary for an examination under par. (a), the commissioner may examine the accounts, records, documents or evidences of transactions, so far as they relate to the examinee, of any of the following:

601.43(1)(b)1. 1. An officer, manager, general agent, employee, or person who has executive authority over or is in charge of any segment of the examinee’s affairs.

601.43(1)(b)2. 2. A person controlling or having a contract under which the person has the right to control the examinee whether exclusively or with others.

601.43(1)(b)3. 3. A person who is under the control of the examinee, or a person who is under the control of a person who controls or has a right to control the examinee whether exclusively or with others.

601.43(1)(b)4. 4. An individual practice association which contracts with the examinee to provide health care services.

601.43(1)(c) (c) Availability of records. On demand every examinee under par. (a) shall make available to the commissioner for examination any of its own accounts, records, documents or evidences of transactions and any of those of the persons listed in par. (b). Failure to do so shall be deemed to be concealment of records under s. 645.41 (8), except that if the examinee is unable to obtain accounts, records, documents or evidences of transactions, failure shall not be deemed concealment if the examinee terminates immediately the relationship with the other person.

601.43(1)(d) (d) Delivery of records to the office. On order of the commissioner any licensee, registrant, or permittee under chs. 600 to 647 shall bring to the office for examination such records as the order reasonably requires.

601.43(2) (2) Duty to examine.

601.43(2)(a) (a) Insurers and rate service organizations. The commissioner shall examine every domestic insurer and every licensed rate service organization.

601.43(2)(b) (b) On request. Whenever the commissioner is requested by verified petition signed by 25 persons interested as shareholders, policyholders or creditors of an insurer alleging that there are grounds for formal delinquency proceedings, the commissioner shall forthwith examine the insurer as to any matter alleged in the petition. Whenever the commissioner is requested to do so by the board of directors of a domestic insurer, the commissioner shall examine the insurer as soon as reasonably possible.

601.43(2)(c) (c) Specific requirements. The commissioner shall examine insurers as otherwise required by law.

601.43(3) (3) Audits or actuarial or other evaluations. In lieu of all or part of an examination under subs. (1) and (2), or in addition to it, the commissioner may order an independent audit by certified public accountants or an actuarial or other evaluation by actuaries or other experts approved by the commissioner of any person subject to the examination requirement. Any accountant, actuary or other expert selected is subject to rules respecting conflicts of interest promulgated by the commissioner. Any audit or evaluation under this section is subject to s. 601.44, so far as appropriate.

601.43(4) (4) Alternatives to examination. In lieu of all or part of an examination under this section, the commissioner may accept the report of an audit already made by certified public accountants or of an actuarial or other evaluation already made by actuaries or other experts approved by the commissioner, or the report of an examination made by the insurance department of another state or of the examination by another government agency in this state, the federal government or another state.

601.43(5) (5) Purpose and scope of examination. An examination may but need not cover comprehensively all aspects of the examinee’s affairs and condition. The commissioner shall determine the exact nature and scope of each examination, and in doing so shall take into account all relevant factors, including but not limited to the length of time the examinee has been doing business, the length of time the examinee has been licensed in this state, the nature of the business being examined, the nature of the accounting records available and the nature of examinations performed elsewhere. The examination of an alien insurer shall be limited to insurance transactions and assets in the United States unless the commissioner orders otherwise after finding that extraordinary circumstances necessitate a broader examination.

601.43 History History: 1977 c. 203; 1977 c. 339 s. 43; 1979 c. 89; 1979 c. 102 ss. 70, 71, 236 (6), (9); 1979 c. 177; 1981 c. 20; 1983 a. 358; 1985 a. 29; 1987 a. 247; 1989 a. 23; 1999 a. 30; 2019 a. 129.

601.44 601.44 Conducting examinations.

601.44(1) (1) Order of examination. For each examination under s. 601.43, the commissioner shall issue an order stating the scope of the examination and designating the examiner in charge. Upon demand a copy of the order shall be exhibited to the examinee.

601.44(2) (2) Access to examinee. Any examiner authorized by the commissioner shall, so far as necessary to the purposes of the examination, have access at all reasonable hours to the premises and to any books, records, files, securities, documents or property of the examinee and to those of persons under s. 601.43 (1) (b) so far as they relate to the affairs of the examinee.

601.44(3) (3) Cooperation. The officers, employees and agents of the examinee and of persons under s. 601.43 (1) (b) shall comply with every reasonable request of the examiners for assistance in any matter relating to the examination. No person may obstruct or interfere with the examination in any way other than by legal process.

601.44(4) (4) Correction of books. If the commissioner finds the accounts or records to be inadequate for proper examination of the condition and affairs of the examinee or improperly kept or posted, the commissioner may employ experts to rewrite, post or balance them at the expense of the examinee.

601.44(5) (5) Report on examination. The examiner in charge of an examination shall make a proposed report of the examination which shall include such information and analysis as is ordered in sub. (1), together with the examiner’s recommendations. Preparation of the proposed report may include conferences with the examinee or the examinee’s representatives at the option of the examiner in charge. The proposed report shall remain confidential until filed under sub. (6).

601.44(6) (6) Adoption and filing of examination report. The commissioner shall serve a copy of the proposed report upon the examinee. Within 20 days after service, the examinee may serve upon the commissioner a written demand for a hearing on the contents of the report. If a hearing is demanded, the commissioner shall give notice and hold a hearing under ch. 227, except that on demand by the examinee the hearing shall be private. Within 60 days after the hearing or if no hearing is demanded then within 60 days after the last day on which the examinee might have demanded a hearing, the commissioner shall adopt the report with any necessary modifications and file it for public inspection, or the commissioner shall order a new examination.

601.44(7) (7) Copy for examinee. The commissioner shall forward a copy of the examination report to the examinee immediately upon adoption, except that if the proposed report is adopted without change, the commissioner need only so notify the examinee.

601.44(8) (8) Copies for board. The examinee shall forthwith furnish copies of the adopted report to each member of its board.

601.44(9) (9) Copies for other persons. The commissioner may furnish, without cost or at a price to be determined by the commissioner, a copy of the adopted report to the insurance commissioner of each state in the United States and of each foreign jurisdiction in which the examinee is authorized to do business, and to any other interested person in this state or elsewhere.

601.44(10) (10) Report as evidence. In any proceeding by or against the examinee or any officer or agent thereof the examination report as adopted by the commissioner shall be admissible as evidence of the facts stated therein. In any proceeding commenced under ch. 645, the examination report whether adopted by the commissioner or not shall be admissible as evidence of the facts stated therein. In any proceeding by or against the examinee, the facts asserted in any report properly admitted in evidence shall be presumed to be true in the absence of contrary evidence.

601.44 History History: 1977 c. 203 s. 102; 1979 c. 102 ss. 72, 236 (6), (17); 1991 a. 316.

601.44 Cross-reference Cross-reference: See also ch. Ins 5, Wis. adm. code.

601.45 601.45 Examination costs.

601.45(1) (1) Costs to be paid by examinees. The reasonable costs of examinations and audits under ss. 601.43, 601.44, and 601.83 (5) (f) shall be paid by examinees except as provided in sub. (4), either on the basis of a system of billing for actual salaries and expenses of examiners and other apportionable expenses, including office overhead, or by a system of regular annual billings to cover the costs relating to a group of companies, or a combination of such systems, as the commissioner may by rule prescribe. Additional funding, if any, shall be governed by s. 601.32. The commissioner shall schedule annual hearings under s. 601.41 (5) to review current problems in the area of examinations.

601.45(2) (2) Duty to pay. The amount payable under sub. (1) shall become due 10 days after the examinee has been served a detailed account of the costs.

601.45(3) (3) Deposit. The commissioner may require any examinee, before or from time to time during an examination, to deposit with the secretary of administration such deposits as the commissioner deems necessary to pay the costs of the examination. Any deposit and any payment made under subs. (1) and (2) shall be credited to the appropriation account under s. 20.145 (1) (g) 1.

601.45(4) (4) Exemptions. On the examinee’s request or on the commissioner’s own motion, the commissioner may pay all or part of the costs of an examination from the appropriation under s. 20.145 (1) (g) 1., whenever the commissioner finds that because of the frequency of examinations or other factors, imposition of the costs would place an unreasonable burden on the examinee. The commissioner shall include in his or her annual report information about any instance in which the commissioner applied this subsection.

601.45(5) (5) Retaliation. Deposits and payments under this section shall not be deemed to be a tax or license fee within the meaning of any statute. If any other state charges a per diem fee for examination of examinees domiciled in this state, any examinee domiciled in that other state shall be required to pay the same fee when examined by the insurance office of this state.

601.45 History History: 1977 c. 29; 1979 c. 102; 1981 c. 20; 2003 a. 33; 2007 a. 20; 2011 a. 32; 2017 a. 138.

601.45 Cross-reference Cross-reference: See also s. Ins 16.01, Wis. adm. code.

601.46 601.46 Commissioner’s records and reports.

601.46(1) (1) Record maintenance. The commissioner shall maintain the records required by law and those necessary to provide for the continued effective operation of the office, to constitute an adequate and proper recording of its activities and to protect the rights of the people of this state. The records shall be preserved in the office except as provided in s. 16.61.

601.46(2) (2) Record of proceedings and activities. The commissioner shall maintain a permanent record of proceedings and important activities, including a concise statement of the condition of each insurer visited or examined, and including a record of all certificates of authority and licenses issued.

601.46(3) (3) Annual reports. Prior to September 1 of each year, the commissioner shall submit a report to the governor and to the chief clerk of each house of the legislature, for distribution to the legislature under s. 13.172 (2), which shall include, for the preceding calendar year:

601.46(3)(a) (a) The chart and explanation prepared under s. 601.19;