Michigan Association Health Plans

On Sept. 24, 2018, Director McPharlin issued Bulletin 2018-21-INS to reiterate Michigan’s requirements on association health plans (AHPs) and that state law continues to regulate AHPs.

As background, on June 21, 2018, the DOL issued final regulations regarding association health plans (AHPs). Under the regulations, a group or association of employers may act as a single “employer” sponsor of an association health plan under ERISA. The federal regulations attempted to encourage the creation of these associations, but emphasized that the states retain their authority to regulate AHPs. This bulletin clarifies the coordination with MI law.

The main purpose of this bulletin is to remind insurers that the state retains the right to regulate MEWAs, regardless of changes to federal law. Employers should be aware that their participation in a fully insured MEWA will likely fall under MI’s jurisdiction. The state also took the time to reiterate that an organization operating (or seeking to operate) a self-funded MEWA must be licensed as an insurance carrier to do so or risk being considered an illegal operation.

Lastly, fully-insured associations created in a state other than MI must comply with all applicable MI insurance law if coverage is issued to an employer with a physical presence in MI that employs at least one MI resident.

Bulletin 2018-21-INS »