CS/HB 897 2023
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
A bill to be entitled 1
An act relating to group health plans; amending s. 2
624.438, F.S.; making technical changes; revising the 3
definition of and providing requirements for bona fide 4
groups for purposes of issuance of certificates of 5
authority and multiple -employer welfare arrangements; 6
providing an effective date. 7
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Be It Enacted by the Legislature of the State of Florida: 9
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Section 1. Paragraph (b) of subsection (1) of section 11
624.438, Florida Statutes, is amended to read: 12
624.438 General eligibility. — 13
(1) To meet the requirements for issuance of a certificate 14
of authority and to maintain a multiple -employer welfare 15
arrangement, an arrangement: 16
(b) Must be established by a trade association, industry 17
association, professional association of employers or 18
professionals, or a bona fide group that as defined in 29 C.F.R. 19
part 2510.3-5 which has a constitution or bylaws specifically 20
stating its purpose and that which has been organized for 21
purposes in addition to obtaining or providing insurance. 22
1. A trade association consists of employer members member 23
employers who are in the same trade as recognized by the 24
appropriate licensing agency. 25
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
2. An industry association consists of employer members 26
member employers who are in the same major group code, as 27
defined by the Standard Industrial Classification Manual issued 28
by the federal Office of Management and Budget, unless 29
restricted by subparagraph 1. or subparagraph 3. 30
3. A professional association consists of employer members 31
member employers who are of the same profession as recognized by 32
the appropriate licensing agency. 33
4. A bona fide group is a group or association of 34
employers which meets the following requirements: 35
a. The primary purpose of the group or association may be 36
to offer and provide health coverage to its employer members and 37
their employees, but the group or association has at least one 38
substantial business purpose that is unrelated to offering and 39
providing health coverage or other employee benefits to its 40
employer members and their employees. For purposes of this 41
subparagraph, as a safe harbor, a substantial business purpose 42
is considered to exist if the group or association would be a 43
viable entity in the absence of sponsoring an employee benefit 44
plan. The business purpose includes promoting common business 45
interests of its members or the common economic interests in a 46
given trade or employer community, and is not required to be a 47
for-profit activity. 48
b. Each employer member of the group or association 49
participating in the group health plan is a person acting 50
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
directly as an employer of at least one employee who is a 51
participant covered under the plan. 52
c. The group or association has a formal organization al 53
structure with a governing body. 54
d. The functions and activities of the group or 55
association are controlled by its employer members, and the 56
group's or association's employer members that participate in 57
the group health plan control the plan. Control must be present 58
both in form and in substance. 59
e. The employer members have a principal place of business 60
in the same region that does not exceed the boundaries of a 61
single state or a metropolitan area, even if the metropolitan 62
area includes more than on e state. 63
f. The group or association does not make health coverage 64
through the group's or association's group health plan available 65
to any person other than: 66
(I) An employee of a current employer member of the group 67
or association; 68
(II) A former employee of a current employer member of the 69
group or association who became eligible for coverage under the 70
group health plan when the former employee was an employee of 71
the employer; or 72
(III) A beneficiary, such as a spouse or dependent child, 73
of an individual described in sub -sub-subparagraph (I) or sub - 74
sub-subparagraph (II). 75
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
g. The group or association and the health coverage 76
offered by the group or association comply with the 77
nondiscrimination provisions of s. 627.6699. 78
h. The group or association is not a health insurance 79
issuer, as defined in s. 733(b)(2) of the Employee Retirement 80
Income Security Act of 1974, or owned or controlled by such 81
health insurance issuer or by a subsidiary or affiliate of such 82
health insurance issuer, o ther than to the extent such entities 83
participate in the group or association in their capacity as 84
employer members of the group or association. 85
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The requirements of this paragraph do not apply to an 87
arrangement licensed before April 1, 1995, regardless of the 88
nature of its business. However, an arrangement exempt from the 89
requirements of this paragraph may not expand the nature of its 90
business beyond that set forth in the articles of incorporation 91
of its sponsoring association as of April 1, 1995, except a s 92
authorized in this paragraph. 93
Section 2. This act shall take effect upon becoming a law. 94