87R10919 MWC-F
By: Powell S.B. No. 1861
A BILL TO BE ENTITLED
AN ACT
relating to the eligibility of certain groups or associations that
include self-employed individuals to participate in a multiple
employer welfare arrangement.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 846.201, Insurance Code, is amended by
amending Subsection (b) and adding Subsection (c) to read as
follows:
(b) Except as otherwise limited by the Employee Retirement
Income Security Act of 1974 (29 U.S.C. Section 1001 et seq.), a
multiple employer welfare arrangement may only provide benefits to:
(1) active or retired owners, officers, directors, or
employees of or partners in:
(A) participating employers; or
(B) bona fide groups or associations of
employers; and
(2) the beneficiaries of a person described by
Subdivision (1).
(c) A group or association is considered a bona fide group
or association of employers for the purpose of this section if:
(1) the group or association has at least one
substantial business purpose unrelated to offering and providing
health coverage or other employee benefits to its employer-members
and their employees, including the purpose of promoting the common
business interests of its members or promoting the economic
interests of its members in a trade or employer opportunity,
regardless of whether the business purpose is a for-profit
activity;
(2) the group or association would be a viable entity
in the absence of sponsoring an employee benefit plan;
(3) each employer-member of the group or association
participating in the group health plan is a person acting directly
as an employer of at least one employee who is covered under the
plan, which may include a sole proprietor or principal of a business
entity and regardless of whether any other person is employed by the
sole proprietor or principal of a business entity;
(4) the group or association has a formal
organizational structure with a governing body and by-laws or other
similar indications of formality;
(5) the functions and activities of the group or
association are controlled by its employer-members, and the group's
or association's employer-members that participate in the group
health plan control the plan; and
(6) the employer-members have a commonality of
interest because the members:
(A) are in the same trade, industry, line or
business, or profession; or
(B) have a principal place of business in the
same region that does not extend beyond the boundaries of:
(i) a state; or
(ii) a metropolitan area regardless of
whether the metropolitan area includes more than one state.
SECTION 2. This Act takes effect September 1, 2021.