Virginia Administrative Code › Title 14 - INSURANCE › Agency 5 - STATE CORPORATION COMMISSION, BUREAU OF INSURANCE › Chapter 415 - RULES GOVERNING SELF-FUNDED MULTIPLE EMPLOYER WELFARE ARRANGEMENTS › Section 14VAC5-415-30 - Establishment of self-funded multiple employer welfare arrangements

Current through Register Vol. 40, No. 24, July 15, 2024
A. No person
				shall establish or operate a self-funded multiple employer welfare arrangement
				in the Commonwealth without obtaining a license from the commission. Any person
				may apply to the commission for a license to establish and operate a
				self-funded MEWA in compliance with this chapter.
B. Each application for a license shall be
				verified by an officer or authorized representative of the applicant, shall be
				in a form prescribed by the commission, and shall set forth or be accompanied
				by the following:
1. A copy of any basic
				organizational documents of the applicant, including the articles of
				incorporation, articles of association, trust agreement, or other applicable
				documents, and all amendments to those documents;
2. A copy of the bylaws, rules and
				regulations, or any similar document regulating the conduct of the internal
				affairs of the applicant;
3. The
				names, addresses, and official positions, and biographical information on forms
				acceptable to the commission of each member of the governing body and any
				person with authority to manage or establish policy;
4. Financial statements showing the
				applicant's assets, liabilities, and sources of financial support and a copy of
				the applicant's most recent audited financial statement completed no more than
				one year prior to the date of application;
5. A complete description of the plan of
				operation, including (i) the method of marketing the plan, (ii) a statement
				regarding the sources of working capital as well as any other sources of
				funding, and (iii) a description of any insurance, reinsurance, or alternative
				coverage arrangements proposed, including specific, aggregate, and terminal
				excess insurance or stop loss insurance;
6. A financial feasibility plan that includes
				(i) detailed enrollment projections; (ii) the methodology for determining
				premium rates to be charged during at least the first three years of operations
				and extending one year beyond the anticipated break-even point certified by an
				actuary; and (iii) a projection, along with material assumptions, of balance
				sheets, cash flow statements showing capital expenditures, and purchase and
				sale of investments and income statements on a quarterly basis for at least
				three years and extending one year beyond the anticipated break-even
				point;
7. The names, addresses, and
				qualifications of persons responsible for the conduct of the applicant's
				affairs, including any third-party administrators;
8. The names, addresses, and qualifications
				of persons who will solicit, negotiate, procure, or effect applications for
				coverage with the self-funded MEWA;
9. Copies of (i) policies providing specific,
				aggregate, and terminal excess insurance; (ii) fiduciary liability insurance;
				(iii) the bond that satisfies the requirements of ERISA; and (iv) guarantees or
				standby letters of credit;
10. A
				copy of the self-funded MEWA's Form M-1, Report for Multiple Employer Welfare
				Arrangements, for the applicable plan year;
11. A signed attestation confirming that:
a. The self-funded MEWA makes available
				health plans or health benefit plans that meet the requirements for health
				benefit plans set forth in § 38.2-3420 B 3 of the Code of
				Virginia;
b. The sponsoring
				association is a nonstock corporation formed under the Virginia Nonstock
				Corporation Act (§ 13.1-801 et seq. of the Code of Virginia) that has been
				formed and maintained in good faith for purposes other than obtaining or
				providing health benefits;
c. The
				sponsoring association does not condition membership in the association on any
				factor relating to the health status of an individual, including an employee of
				an employer member of the sponsoring association or a dependent of such an
				employee;
d. The sponsoring
				association makes any health benefit plan available to all members regardless
				of any factor relating to the health status of such members or individuals
				eligible for coverage through another member;
e. The sponsoring association does not make
				any health benefit plan available to any person who is not a participating
				employee of the association or member of the association;
f. The sponsoring association operates as a
				nonprofit entity under § 501(c)(5) or (c)(6) of the Internal Revenue
				Code;
g. The sponsoring association
				has been in active existence for at least five years; and
h. The guarantees or standby letters of
				credit comply with § 59.1-590 B 7 of the Code of Virginia; and
12. Any other information the
				commission may require.