Expanded health insurance options set for Ohio businesses


Staff report



Ohio Department of Insurance


COLUMBUS — Lieutenant Governor Mary Taylor announced that the state budget bill – House Bill 64 – signed by Governor John Kasich provides expanded options for Ohio businesses shopping for employee health insurance through the use of Multiple Employer Welfare Arrangements or MEWAs.

MEWAs are arrangements that allow different employers to come together and purchase health insurance. These types of arrangements have been in Ohio and other states for years.

The state budget bill provisions modernized statutes that had not been updated in 20 years. MEWAs are now required to hold additional capital and surplus, and new disclosure requirements have been added for employer members. The bill also included provisions that both strengthen the consumer protections around these type of arrangements, as well as expand who can sponsor a MEWA.

Self-insured MEWAs are already licensed and regulated by the Ohio Department of Insurance.

“We broadened the definition of who can sponsor a MEWA in order to give Ohio businesses more options,” said Taylor, also Director of the Ohio Department of Insurance. “At the same time we have enhanced financial requirements for MEWAs to strengthen consumer protections to ensure common sense regulation.”

Key MEWA provisions in the state budget bill include:

The types of entities eligible to sponsor MEWAs was expanded to include a group or organization recognized as a chamber of commerce, a tax-exempt voluntary employee beneficiary association or business league, or other association specified by the Ohio Department of Insurance – encouraging more options for those who want to both sponsor and participate in a MEWA.

Stronger consumer safeguards that ensure MEWAs hold appropriate financial reserves for the risks they are assuming. The minimum surplus amount was increased from $150,000 to $500,000. In addition, for the first time, MEWAs must meet the same risk-based capital requirements for life and health insurers.

Requiring additional disclosures to ensure MEWA members better understand how the arrangement works. In particular, if there is a shortfall, MEWA members will be assessed to correct the imbalance.

An annual certification that the premium rates being charged by the MEWA continue to be appropriate that is required to be filed and reviewed by the Ohio Department of Insurance.

Representatives of eligible entities interested in forming a MEWA and business owners who want to learn more about MEWAs can call the Ohio Department of Insurance at 614-728-1074.

Ohio Department of Insurance
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Staff report

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