Administrative Code

Virginia Administrative Code
Title 14. Insurance
Agency 5. State Corporation Commission, Bureau of Insurance
1/23/2020

Chapter 410. Rules Governing Multiple Employer Welfare Arrangements

14VAC5-410-10. Purpose.

The purpose of this chapter is to set forth rules to carry out the provisions of Article 3 (§ 38.2-3420 et seq.) of Chapter 34 of Title 38.2 of the Code of Virginia so as to establish reasonable standards for the licensing and operation of multiple employer welfare arrangements in the Commonwealth of Virginia.

Statutory Authority

§ 38.2-223 and Article 3 (§ 38.2-3420 et seq.) of Chapter 34 of Title 38.2 of the Code of Virginia.

Historical Notes

Derived from Regulation 31, Case No. INS910244, § 2, eff. January 15, 1992.

14VAC5-410-20. Applicability and scope.

A. This chapter shall apply to all multiple employer welfare arrangements offering or providing coverage in this Commonwealth if any of the following conditions is met:

1. The multiple employer welfare arrangement is domiciled in Virginia;

2. At least one employer whose principal office or headquarters is located in Virginia provides health care benefits to his employees through the multiple employer welfare arrangement, regardless of the plan's place of domicile; or

3. At least one employee who is employed in Virginia and who has been initially enrolled in the plan in Virginia is being provided health care benefits through the multiple employer welfare arrangement, regardless of the plan's place of domicile or the location of the employer's principal office or headquarters.

B. Multiple employer welfare arrangements shall be subject to all of the provisions of Title 38.2 of the Code of Virginia to the extent that such provisions are applicable to multiple employer welfare arrangements in accordance with § 38.2-3421 of the Code of Virginia.

Statutory Authority

§ 38.2-223 and Article 3 (§ 38.2-3420 et seq.) of Chapter 34 of Title 38.2 of the Code of Virginia.

Historical Notes

Derived from Regulation 31, Case No. INS910244, § 3, eff. January 15, 1992.

14VAC5-410-30. Definitions.

As used in this chapter:

"Commission" means the State Corporation Commission.

"Contribution" means the amount paid or payable by the employer or employee for services provided through the multiple employer welfare arrangement.

"Direct basis" means that the liability of the insurer, health maintenance, organization, health services plan, or dental or optometric services plan runs directly to the insured employee or certificate holder.

"Domicile" means the situs of the trust through which the multiple employer welfare arrangement is established, the plan's place of incorporation or, if not set up through a trust or incorporated, the location of the plan's headquarters.

"Fully insured" means all of the covered benefits are (i) insured on a direct basis by an insurance company licensed and in good standing to transact the business of insurance in Virginia pursuant to Title 38.2 of the Code of Virginia or (ii) arranged for or provided on a direct basis by (a) a health services plan licensed and in good standing in Virginia pursuant to Chapter 42 (§ 38.2-4200 et seq.) of Title 38.2 of the Code of Virginia, (b) a health maintenance organization licensed and in good standing in Virginia pursuant to Chapter 43 (§ 38.2-4300 et seq.) of Title 38.2 of the Code of Virginia, (c) a dental or optometric services plan licensed and in good standing in Virginia pursuant to Chapter 45 (§ 38.2-4500 et seq.) of Title 38.2 of the Code of Virginia, or (d) any combination thereof. The existence of contracts of reinsurance will not be considered in determining whether a plan is "fully insured."

"Good standing" means the license of any (i) company to transact the business of insurance in the Commonwealth of Virginia pursuant to Title 38.2 of the Code of Virginia, (ii) health services plan licensed pursuant to Chapter 42 (§ 38.2-4200 et seq.) of Title 38.2 of the Code of Virginia, (iii) health maintenance organization licensed pursuant to Chapter 43 (§ 38.2-4300 et seq.) of Title 38.2 of the Code of Virginia, or (iv) dental or optometric services plan licensed pursuant to Chapter 45 (§ 38.2-4500 et seq.) of Title 38.2 of the Code of Virginia where the license is not suspended or revoked, or the company, health services plan, health maintenance organization, or dental or optometric services plan is not precluded by order of the Commission from soliciting, negotiating, procuring or effecting contracts of insurance.

"Health care services" means services which are furnished to an individual for the purpose of preventing, alleviating, or healing human illness, injury, or physical disability. Such terminology may include services for optometric or dental care.

"Member" means an employer which participates in a multiple employer welfare arrangement.

"Multiple employer welfare arrangement" means any plan or arrangement which is established or maintained for the purpose of offering or providing coverage for health care services, whether such coverage is by direct payment, reimbursement, or otherwise, to employees of two or more employers, or to their beneficiaries except that such term does not include any such plan or other arrangement which is established or maintained:

1. Under or pursuant to one or more agreements which the Secretary of the United States Department of Labor finds to be collective bargaining agreements, or

2. By a rural electric cooperative.

For purposes of the definition of multiple employer welfare arrangement:

a. Two or more trades or businesses, whether or not incorporated, shall be deemed a single employer if such trades or businesses are within the same control group;

b. The term "control group" means a group of trades or businesses under common control;

c. The determination of whether a trade or business is under "common control" with another trade or business shall be determined under regulations of the Secretary of the United States Department of Labor applying principles similar to the principles applied in determining whether employees of two or more trades or businesses are treated as employed by a single employer under section 4001(b) of the Employee Retirement Income Security Act, (29 USCS § 1301(b)), except that, for purposes of this subdivision, common control shall not be based on an interest of less than 25%; and

d. The term "rural electric cooperative" means:

(1) Any organization which is exempt from tax under section 501(a) of the Internal Revenue Code of 1986 (26 USC § 501(a)) and which is engaged primarily in providing electric service on a mutual or cooperative basis, and

(2) Any organization described in paragraph (4) or (6) of section 501(c) of the Internal Revenue Code of 1986 (26 USC § 501(c)(4) or (6)) which is exempt from tax under section 501(a) of such Code (26 USC § 501(a)) and at least 80% of the members of which are organizations described in subdivision (1).

Statutory Authority

§ 38.2-223 and Article 3 (§ 38.2-3420 et seq.) of Chapter 34 of Title 38.2 of the Code of Virginia.

Historical Notes

Derived from Regulation 31, Case No. INS910244, § 4, eff. January 15, 1992.

14VAC5-410-40. Licensing and filing requirements.

A. A multiple employer welfare arrangement that is not fully insured as defined in this chapter shall not operate in this Commonwealth without first meeting the criteria and becoming appropriately licensed as an insurance company, health maintenance organization, health services plan, or a dental or optometric services plan pursuant to Title 38.2 of the Code of Virginia.

B. A fully insured multiple employer welfare arrangement shall not operate in this Commonwealth without first filing with the Commission:

1. The names, addresses, and biographical summaries of the plan's trustees, officers, directors or other members of the plan's governing body.

2. The names, addresses, and qualifications of individuals responsible for the conduct of the plan's affairs, including any third-party administrators.

3. The names, addresses, and qualifications of persons who will solicit, negotiate, procure, or effect applications for coverage with the plan.

4. The names and addresses of employers participating in the plan.

5. Proof of coverage showing that the plan is fully insured by an insurer, health maintenance organization, health services plan, or dental or optometric services plan as required by the definition of "fully insured" in 14VAC5-410-30 of this chapter. Proof of coverage shall be submitted on a form prescribed by the Commission and shall include but not be limited to (i) a copy of the policy insuring the plan; (ii) confirmation from the insurer, health maintenance organization, health services plan, or a dental or optometric services plan that coverage is in force; and (iii) a statement indicating the length of time coverage has been in force.

6. Any other information the Commission may require including but not limited to information pertaining to the adequacy of the plan's level of reserves and contributions.

C.1. If a multiple employer welfare arrangement changes coverage or does not remain fully insured as the term is defined in 14VAC5-410-30 of this chapter, the plan shall notify the Commission at least 30 days prior to the effective date of any change or reduction in coverage.

2. Any multiple employer welfare arrangement which ceases to remain fully insured shall, at least 30 days prior to the effective date of coverage termination, (i) notify the Commission of a replacement policy in accordance with subdivision B 5 of this section, or (ii) apply for a license as an insurer, health maintenance organization, health services plan, or a dental or optometric services plan and be subject to all applicable provisions of Title 38.2 of the Code of Virginia. Such plan shall not be required to cease operations or discontinue benefits to existing members during this 30-day period. However, such plan shall not solicit, negotiate, procure, or effect coverage for new enrollments other than for dependents of employees already enrolled during this 30-day period unless (i) the plan has been licensed as required by this chapter, (ii) the plan becomes fully insured as the term is defined in 14VAC5-410-30 of this chapter and has provided the Commission with proof of coverage as required by subdivision B 5 of this section, or (iii) the plan is granted an extension by the Commission for good cause shown. Nothing contained in this section shall prevent the Commission from proceeding with an action in accordance with the provisions of 14VAC5-410-60 of this chapter.

3. Any insurer, health maintenance organization, health services plan, or dental or optometric services plan providing coverage to a multiple employer welfare arrangement shall notify the Commission and the multiple employer welfare arrangement of any change or reduction in coverage at least 45 days prior to the effective date of such change or reduction in coverage.

4. Any insurer, health maintenance organization, health services plan, or dental or optometric services plan failing to provide notice to the Commission as required by subdivision 3 of this subsection shall be required to continue coverage to the multiple employer welfare arrangement for an additional 45 days after notice of cancellation is provided to the Commission.

D. In addition to the filing requirements stated in subsection B of this section, each fully insured multiple employer welfare arrangement shall file on or before March 1 of each year (i) proof of coverage as set forth in subdivision B 5 of this section and (ii) notice of any changes in information as filed with the Commission.

E. Any multiple employer welfare arrangement offering or providing coverage in this Commonwealth shall be subject to examination by the Commission in accordance with § 38.2-3422 of the Code of Virginia.

F. Notwithstanding any other provision of this chapter, any multiple employer health care plans licensed and operating, or whose license application is pending with the Commission on the effective date of this chapter and subsequently approved by the Commission may continue to operate as a multiple employer health care plan in the Commonwealth of Virginia, pursuant to the Commission's Rules Governing Multiple Employer Health Care Plans, for a period not to exceed three years after the effective date of this chapter.

Statutory Authority

§ 38.2-223 and Article 3 (§ 38.2-3420 et seq.) of Chapter 34 of Title 38.2 of the Code of Virginia.

Historical Notes

Derived from Regulation 31, Case No. INS910244, § 5, eff. January 15, 1992.

14VAC5-410-50. Licensing of persons soliciting, negotiating, procuring, or effecting applications for coverage.

A. No person shall solicit, negotiate, procure, or effect applications for coverage or member enrollments, and no multiple employer welfare arrangement, insurer, health maintenance organization, nonstock health services plan, or nonstock dental or optometric services plan shall knowingly permit a person to solicit, negotiate, procure, or effect applications for coverage or member enrollments, in this Commonwealth for a multiple employer welfare arrangement whether or not the plan is licensed in this Commonwealth without first obtaining a license as a life and health agent, and an appointment, if such appointment is required, in a manner and in a form prescribed by the Commission pursuant to Chapter 18 (§ 38.2-1800 et seq.) of Title 38.2 of the Code of Virginia.

B. Any person who solicits, negotiates, procures, or effects applications or member enrollments in this Commonwealth for coverage under a multiple employer welfare arrangement shall be subject to all appropriate provisions of Title 38.2 as set forth in Chapter 2 (§ 38.2-200 et seq.), 3 (§ 38.2-300 et seq.), 5 (§ 38.2-500 et seq.), 6 (§ 38.2-600 et seq.), and 18 (§ 38.2-1800 et seq.) of the Code of Virginia regarding the conduct of his business.

C. Salaried officers or employees of any employer which provides coverage through a multiple employer welfare arrangement shall not be required to be licensed under this section provided that the principal duties and responsibilities of such officers and employees do not include soliciting, negotiating, procuring, or effecting applications for coverage or member enrollments for the plan.

Statutory Authority

§ 38.2-223 and Article 3 (§ 38.2-3420 et seq.) of Chapter 34 of Title 38.2 of the Code of Virginia.

Historical Notes

Derived from Regulation 31, Case No. INS910244, § 6, eff. January 15, 1992.

14VAC5-410-60. Violations.

Any violation of this chapter shall be punished as provided for in § 38.2-218 of the Code of Virginia and any applicable law of this Commonwealth. The provisions of §§ 38.2-219 through 38.2-222 of the Code of Virginia shall also apply to any multiple employer welfare arrangement that fails to comply with the provisions set forth in this chapter.

Statutory Authority

§ 38.2-223 and Article 3 (§ 38.2-3420 et seq.) of Chapter 34 of Title 38.2 of the Code of Virginia.

Historical Notes

Derived from Regulation 31, Case No. INS910244, § 7, eff. January 15, 1992.

14VAC5-410-70. Service of process.

Suits, actions, and proceedings may be begun against any multiple employer welfare arrangement providing coverage in this Commonwealth by serving process on any trustee, director, officer, or agent of the plan, or, if none can be found, on the clerk of the Commission. If any multiple employer welfare arrangement that is not fully insured provides coverage in this Commonwealth without obtaining a license as required by 14VAC5-410-40 of this chapter, it shall be deemed to have thereby appointed the Clerk of the Commission its attorney for service of process. Service of process shall be made as provided for in Article 1 (§ 38.2-800 et seq.) of Chapter 8 of Title 38.2.

Statutory Authority

§ 38.2-223 and Article 3 (§ 38.2-3420 et seq.) of Chapter 34 of Title 38.2 of the Code of Virginia.

Historical Notes

Derived from Regulation 31, Case No. INS910244, § 8, eff. January 15, 1992.

14VAC5-410-80. Severability.

If any provision of this chapter or the application thereof to any person or circumstance is for any reason held to be invalid, the remainder of the chapter and the application of such provision to other persons or circumstances shall not be affected thereby.

Statutory Authority

§ 38.2-223 and Article 3 (§ 38.2-3420 et seq.) of Chapter 34 of Title 38.2 of the Code of Virginia.

Historical Notes

Derived from Regulation 31, Case No. INS910244, § 9, eff. January 15, 1992.

Forms (14VAC5-410)

Policy Verification Form (eff. 6/93).

Proof of Coverage Form (eff. 6/93).

Demographic Information (eff. 6/93).

Biographical Affidavit (eff. 6/93).

Other Title 14 Forms

ANNUAL STATEMENTS

COMPANY TYPE

Life and Accident and Health, Form 1.

Canadian Life and Accident and Health, Form 1-A.

Life and Accident and Health, Separate Accounts, Form 1-S.

Fire and Casualty, Form 2.

Fraternal Orders, Form 4.

Assessment Life and Accident, Form 5.

Title Insurance, Form 9.

Hospital, Medical and Dental Service or Indemnity Corporation, Form 13.

Mutual Assessment Property and Casualty (eff. 1988).

SUPPLEMENTS TO THE ANNUAL STATEMENT

Credit Insurance Experience Exhibit, CIEE 2, 3, 4, 5, 6 and 7 (eff. 1992).

Insurance Expense Exhibit, IEE 2, 3, 4, 5, 6, 7 and 8.

Financial Guaranty Insurance Exhibit.

Stockholders Information Supplement, Schedule SIS (eff. 1992).

Fraternal Interest Sensitive Life Insurance Products Reports, FISL 3 and 4 (eff. 1993).

Life and Accident and Health Blank Interest Sensitive Life, ISL 2, 3, and 4 (eff. 1993).

Long Term Care Insurance Exhibit, Supplement to the Fraternal Order Annual Statement (eff. 1993).

Long Term Care Insurance Exhibit, Supplement to the Life Insurance Company Annual Statement (eff. 1993).

Accident and Health Policy Experience Exhibit, Form 0-9.

Fire and Casualty Supplemental Long-Term Care Experience Nationwide Experience Claim Experience By Calendar Duration.

Fire and Casualty Supplemental Long-Term Care Experience Nationwide Experience Cumulative Claim Experience.

Fire and Casualty Supplemental Long-Term Care Experience Experience in the State of... Cumulative Claim Experience.

Fraternal Orders Supplemental Long-Term Care Experience Nationwide Experience Claim Experience By Calendar Duration.

Fraternal Orders Supplemental Long-Term Care Experience Nationwide Experience Cumulative Claim Experience.

Fraternal Orders Supplemental Long-Term Care Experience Nationwide Experience Experience in the State of... Cumulative Claim Experience.

Life and Accident and Health Supplemental Long-Term Care Form-A Nationwide Experience Claim Experience By Calendar Duration, Form 4.

Life and Accident and Health Supplemental Long-Term Cure Form-B Nationwide Experience Cumulative Claim Experience By Calendar Duration, Form 4.

Life and Accident and Health Supplemental Long-Term Cure Form-C Experience in the State of... Cumulative Claim, Form 4.

Fraternal Benefit Societies-Supplement to Valuation Report (eff. 1978).

Schedule DM (eff. 1992).

Schedule DS - Part 2 (eff. 1993).

Analysis of Excess Capital and Surplus Investments, SCCBOI-4 (eff. 11/93).

Application for Renewal of License, SCCBOI-1A.

Application for Renewal of License (Chapter Companies), SCCBOI-1B.

Application for Renewal of License (HMDI), SCCBOI-8.

Report of Assets Pledged, Hypothecated or Encumbered, SCCBOI-17 (eff. 8/92).

Report of Assets Pledged, Hypothecated or Encumbered, SCCBOI-18 (eff. 8/92).

Report of Assets Pledged, Hypothecated or Encumbered, SCCBOI-19 (eff. 8/92).

Report of Assets Pledged, Hypothecated or Encumbered, SCCBOI-20 (eff. 8/92).

Request for Information Regarding Managing General Agent, SCCBOI-21 (eff. 10/93).

Request for Information Regarding Reinsurance Intermediaries, SCCBOI-22.

Affidavit for Exemption from Filing Audited Financial Reports, SCCBOI-16.

Producer Controlled Insurer Report, SCCBOI-23 (eff. 11/93).

Exhibit of Subscriber Fee Income and Net Administrative, SCCBOI-PP.

Supplementary Exhibit of Direct Subscriber Income by State.

Certificate of Assuming Insurer, RENFORMS (14VAC5-410)2 (eff. 10/93).

Appointment of Agent (Purchasing Group).

Appointment of Agent (Risk Retention Group).

QUARTERLY STATEMENTS

Life and Accident and Health, L, A&H-Q (eff. 94).

Fire and Casualty, F&C-Q (eff. 94).

Fraternal Orders, FO-Q (eff. 94).

Assessment Life and Accident, Form 5.

Title Insurance, T-Q (eff. 1994).

Hospital, Medical and Dental Service or Indemnity Corporation, FMDI-Q (eff. 1994).

COMPANY LICENSING FORMS (14VAC5-410)

Application for Initial License.

Application for Initial License (Home Protection Companies).

Estimated Premium License Tax.

Maintenance Assessment for BOI.

Fire Program Fund Report.

Flood Prevention & Protection Assistance Report.

Help Eliminate Auto Theft (HEAT).

Premium License Tax Report - Fire Casualty and Title Insurers, T001 (eff. 1/94).

Premium License Tax Report - Life, Accident and Sickness Insurers, T002 (eff. 1/94).

Report of Subscriber Income Premium License Tax - Legal Service Plans, T003 (eff. 11/93).

Report of Subscriber Income Premium License Tax - Limited Health Service Organizations Dental and Optometric Services Plans, T004 (eff. 1/94).

Report of Subscriber Income Premium License Tax - Health Service Plans, T005 (eff. 1/94).

Premium License Tax Report - Risk Retention Groups, T006 (eff. 1/94).

Report of Subscriber Income Premium License Tax - Mutual Assessment Property and Casualty Insurers, T007 (eff. 1/94).

Report of Subscriber Income Premium License Tax - Cooperative Non-profit Life Benefit Companies Mutual Assessment Life, Accident & Sickness Insurers, and Burial Societies, T008 (eff. 1/94).

Report of Premium Income/Maint. Assessment - Fraternal Benefit Societies, T020 (eff. 1/94).

Maint. Assessment Report - Fire, Casualty and Title Insurers, T021 (eff. 1/94).

Report of Income/Maint. Assessment - Mutual Assessment Property & Casualty Insurers, T022 (eff. 1/94).

Report of Income/Maint. Assessment - Cooperative Non-profit Life Benefit Companies; Mutual Assessment Life; Accident & Sickness Insurers; and Burial Societies, T023 (eff. 1/94).

Report of Subscriber Income/Maint. Assessment - Health Maintenance Organizations, T024 (eff. 1/94).

HEALTH MAINTENANCE ORGANIZATIONS

Annual Statement.

Quarterly Statement.

Application for Renewal of License in Virginia (HMO), HMO-1A.

Annual Complaint Report (HMO), SCCBOIHMO-9.

Statement of Material Changes in Material Previously Filed, SCCBOIHMO-10.

STATUTORY FORMS (14VAC5-410)

Report of Subscriber Income/Maint. Assessment - Legal Service Plans, T025 (eff. 1/94).

Report of Subscriber Income/Maint. Assessment - Limited Health Service Organizations/Dental and Optometric Services Plans, T026 (eff. 1/94).

Report of Subscriber Income/Maint. Assessment - Health Service Organizations, T027 (eff. 1/94).

Report of Premium Income/Maint. Assessment - Members of Group Self-Insurance Associations, T028 (eff. 1/94).

Maint. Assessment Report - Life, Accident and Sickness Insurers, T029 (eff. 1/94).

Maint. Assessment Report - Risk Retention Group, T030 (eff. 1/94).

Fire Programs Fund Report, T041 (eff. 1/94).

Flood Prevention & Protection Assistance Fund Assessment Report, T042 (eff. 1/94).

HEAT Fund Assessment Report, T043 (eff. 1/94).

Retaliatory Tax Report, T050.

Guaranty Fund Credit Affidavit, T051 (eff. 1/94).

Declaration of Est. License Tax and Est. Assessment, T060 (eff. 1/94).

Application for license when No Examination is required, PIN 405A (eff. July 1994).

Application for License, PIN 300A (eff. April 1994).

Agency Application for License, PIN 405B (eff. August 1994).

Application for Individual Consultant License, PIN 370A (eff. July 1994).

Application for Managing General Agent License, PIN 200A (eff. July 1994).

Automobile Club License and Application Form, PIN 320A (eff. July 1994).

Individual Appointment Form, PIN 415A (eff. July 1994).

Managing General Agent Appointment Notification, PIN 200B (eff. July 1994).

Agency Application Form, PIN 415B (eff. July 1994).

Appointment Cancellation Form, PIN 492A (eff. July 1994).

Consultant License Renewal Request, PIN 370B (eff. July 1994).

Renewal Application for Certification.

Application for Certification as a Private Review Agent.

Continuing Care Provider Registration Statement.



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