Association Health Plan Regulation of Out-of-state Plans

On Aug. 27, 2018, Insurance Commissioner Wade released Bulletin HC-123 to provide additional information regarding the regulation of association health plans (AHPs) that are established out of state but offered to Connecticut residents. Specifically, fully insured plans that are established outside of CT that sell products to CT small employers or sole proprietors must file rates and forms for prior approval with the Insurance Department. Further, employers should be aware that their participation in an out-of-state fully insured MEWA (or Multiple Employer Trust (MET)) will fall under CT’s jurisdiction.

This bulletin supersedes HC-122, which was released Aug. 10, 2018. (We discussed that bulletin in the Aug. 21, 2018 edition of Compliance Corner). That bulletin reminded insurers that the state retains the right to regulate MEWAs and METs regardless of changes to federal law.

This new bulletin also reminds employers of previous guidance regarding self-insured or self-funded MEWAs or METs. In 1990, the commissioner issued Bulletin HC-43, which required self-funded MEWAs and METs to be licensed as insurance carriers because they were considered as doing the business of insurance. If a self-funded MEWA or MET is doing the business of insurance without authority or license, then they are considered an illegal operation.

CT employers don’t need to take any action, but just take note that CT is reaffirming the department’s longstanding commitment to regulating unlicensed entities for the protection of consumers.

Katherine L. Wade. “Bulletin HC-123.” Connecticut Insurance Department, »