Bill Summary for S 86 (2019-2020)

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Summary date: 

Feb 19 2019

Bill Information:

View NCGA Bill Details2019-2020 Session
Senate Bill 86 (Public) Filed Tuesday, February 19, 2019
Intro. by Bishop, Krawiec, Edwards.

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Bill summary

Includes whereas clauses.

Part I

Modifies and adds to the requirements for MEWA (multiple employer welfare arrangement) licensure set out in GS 58-49-40. Now requires a MEWA to have a constitution or bylaws and have been organized and maintained in good faith for a continuous period of at least two years for purposes other than obtaining or providing insurance (currently, required the MEWA be established by a trade association, industry association, or professional association of employers or professionals, having a constitution or bylaws, and having been organized and maintained in good faith for a continuous period of five years for purposes other than obtaining or providing insurance). Adds requirement for the MEWA to have at least one substantial business purpose unrelated to offering and providing health care coverage or other employee benefits to its employer members and their employees, and requirement to have a commonality of interest. Provides that a MEWA will be treated as having a commonality of interest if it is established by employers in the same trade, industry, business, or profession, or, by employers in the same region or metro area contiguous to the State and including the State. Makes conforming, technical, and clarifying changes.

Amends GS 58-49-30, which defines MEWA, to specify that the term employer includes sole proprietors and self-employed workers.

Amends GS 58-49-50, adding to the application materials for a MEWA license a copy of the most recent M-1 form filed with the US Department of Labor.

Part II

Amends GS 58-51-80, concerning requirements for group accident and health insurance policies and contracts. Specifies that, as used in the provisions concerning premium payment under a policy issued to an employer or to the trustee of a fund established by an employer or two or more employers in the same industry or kind of business whereby the employer is the policyholder and the policy covers employees or agents for amounts of insurance based on a plan, employer includes a MEWA that is classified by the US Department of Labor as a bona fide group or association under either the specified section of the Employee Retirement Income Security Act or any US Department of Labor advisory opinion, as described. For a policy issued to an association or to a trust or trustees of a fund established, created, or maintained for the benefit of members of one or more associations, requires the association(s) to have 500 persons at the outset, have been organized and maintained in good faith for purposes other than obtaining insurance, and have been in active existence for at least two years (currently, at least five years), among other existing requirements.

Makes technical and clarifying changes to the defined terms set forth in GS 58-68-25. Removes the limiting language from the term employer which defined the term to include only employers of two or more employees.

Part III

Amends GS 58-50-130, prohibiting insurers from providing stop loss, catastrophic, or reinsurance coverage to small employers who employ fewer than 12 eligible employees (currently, fewer than 26 eligible employees) that does not comply with the underwriting, rating, and other applicable standards of the Small Employer Group Health Coverage Reform Act (Part 5, Article 50, GS Chapter 58).

Part IV

Effective October 1, 2019.