Reminder of Existing Requirements for AHPs

On Dec. 11, 2018, Ins. Commissioner Kiser issued Bulletin 2018-5 to remind health insurers, health insurance producers and third-party administrators of the existing Utah statutory requirements related to health coverage offered through an Association Health Plan (AHP). Generally, UT law subjects an AHP to the same statutory and regulatory requirements as any other association group coverage. However, there are differences between UT law and federal requirements.

As background, on June 21, 2018, the DOL released the final AHP rule to provide additional flexibility for a group or association of employers to establish a group health plan as an employer welfare benefit plan under ERISA. The rule acknowledged that no health care coverage provided through a MEWA or AHP is preempted from state regulation.

Self-funded AHPs (or level-funded AHPs) offering health coverage in UT are required to be an admitted insurer in UT. Information regarding the process to obtain a certificate of authority is available here: In addition, an AHP must be a valid association group authorized by the insurance commissioner as well as comply with applicable state laws.

To distinguish from the federal DOL rule, this bulletin identifies separate “pathways” for AHPs; Pathway I AHP applies to those formed under federal requirements prior to Sept. 1, 2018, and Pathway II AHP applies to an AHP formed after Sept. 1, 2018, under the newly available federal rules. In UT, an AHP may select which pathway it is operating under at issuance of the policy or at renewal, but no more frequently than once every twelve months. The applicable experience/claim rating and benefit requirements depend upon the pathway selected.

Finally, an out-of-state AHP may only offer a fully-insured plan to UT employers, including sole proprietors (assuming the AHP is properly filed and meets all applicable UT laws). A self-funded AHP may not provide coverage to UT residents, unless the AHP obtains a certificate of authority as is required of insurers and producers offering coverage to UT residents.

Bulletin 2018-5 »