HB 329

POOLING OF LIABILITIES TO SELF-INSURERS Present law authorizes the following pooling of liabilities:  If certain criteria is met, t wo or more member employers of the same trade or professional organization with at least 500 covered lives may enter into an agreement to pool their liabilities for the purpose of qualifying as self-insurers.  If certain criteria is met, 10 or more employers of the same nonprofit business coalition for health, organized in this state, may enter into an agreement with the coalition to pool their liabilities for the purpose of qualifying as self-insurers.  If certain criteria is met, t wo or more member employers with at least 500 covered lives may enter into an agreement to pool their liabilities for the purpose of qualifying as self-insurers if the employers are members of the same association that has a principal office within this state.  If certain criteria is met, two or more member employers with at least 500 covered lives may enter into an agreement to pool their liabilities for the purpose of qualifying as self-insurers if the employers are members of the same association that has a principal office within a municipality with a boundary that lies at least partially within this state. This bill authorizes, for purposes of pooling liabilities, a foreign multiple employer welfare arrangement to be deemed a domestic multiple employer welfare arrangement if the foreign multiple employer welfare arrangement meets all of the following criteria :  It i s comprised only of banks together with their plan-sponsoring organization, and their respective employees .  It i s duly licensed as a multiple employer welfare arrangement by the regulatory agency having jurisdiction over the regulation of insurance in a state physically contiguous to this state .  It h as no more than 2,500 residents of this state who are employees of its member banks enrolled in or receiving health, sickness, and accident benefits as insureds, members, enrollees, or subscribers of the multiple employer welfare arrangement .  It i s subject to adequate regulatory oversight by the contiguous domiciliary state, including, but not limited to, solvency examination authority and actuarially sound reserve-adequacy requirements, as determined in the commissioner's sole discretion .  It a pplies for and receives a certificate of authority from the commissioner to operate as a foreign multiple employer welfare arrangement. This bill authorizes t he commissioner of commerce and insurance to , in the commissioner's sole discretion, waive any portion of exist ing insurance law relative to accident and sickness insurance , and any portion of existing insurance law relative to policies and policyholders , for a qualifying multiple employer welfare arrangement upon a determination that the multiple employer welfare arrangement is subject to reasonable and adequate oversight by the regulatory agency having jurisdiction over the regulation of insurance in the multiple employer welfare arrangement's domicile. APPLICATION OF TAXATON, FILING AND APPROVAL, AND LAWS Pres ent law provides that p ools so created as described above are subject to taxation, filing and approval, and laws for protection of policyholders as provided in the insurance laws of this state . This bill clarifies that pools deemed domestic are also subje ct to such taxation, filing and approval, and laws for protection of policyholders . DEPARTMENT RULES Present law authorizes the commissioner of commerce and insurance to promulgate rules as deemed necessary to provide for the solvency, administration, e xamination, and enforcement of the pooling agreements. However, such rules must not prohibit or deter any association lawfully formed under the laws of this state or any other state from offering health insurance coverage to its members within this state if the health insurance coverage complies with federal law. This bill clarifies that such rules must not prohibit or deter health insurance coverage through a multiple employer welfare arrangement .