31A-40-208.   Benefit plan.
     (1) A client and a professional employer organization licensed under this chapter shall each be considered an employer for purposes of sponsoring a retirement or welfare benefit plan for a covered employee.
     (2) A fully insured welfare benefit plan offered to a covered employee of a single professional employer organization licensed under this chapter:
     (a) is to be treated as a single employer welfare benefit plan for purposes of this title and rules made under this title;
     (b) may not be considered an employer welfare fund or plan, as described in Section 31A-13-101; and
     (c) the single professional employer organization that sponsors the fully insured welfare plan is exempt from the registration requirements under this title for:
     (i) an insurance provider; or
     (ii) an employer welfare fund or plan.
     (3) For purposes of Chapter 30, Individual, Small Employer, and Group Health Insurance Act:
     (a) a professional employer organization licensed under this chapter is considered the employer of a covered employee; and
     (b) all covered employees of one or more clients participating in a health benefit plan sponsored by a single professional employer organization licensed under this chapter are considered employees of that professional employer organization.
     (4) A professional employer organization licensed under this chapter may offer to a covered employee a health benefit plan that is not fully insured by an authorized insurer, only if:
     (a) the professional employer organization has operated as a professional employer organization for at least one year before the day on which the professional employer organization offers the health benefit plan; and
     (b) the health benefit plan:
     (i) is administered by a third-party administrator licensed to do business in this state;
     (ii) holds all assets of the health benefit plan, including participant contributions, in a trust account;
     (iii) has and maintains reserves that are sound for the health benefit plan as determined by an actuary who:
     (A) uses generally accepted actuarial standards of practice; and
     (B) is an independent qualified actuary, including not being an employee or covered employee of the professional employer organization;
     (iv) provides written notice to a covered employee participating in the health benefit plan that the health benefit plan is self-insured or is not fully insured; and
     (v) consents to an audit:
     (A) on a random basis; or
     (B) upon a finding of a reasonable need by the commissioner.
     (5) The cost of an audit described in Subsection (4)(b)(v) shall be paid by the sponsoring professional employer organization.
     (6) A plan of a professional employer organization described in Subsection (4) that is not fully insured:
     (a) is subject to the requirements of this section; and

     (b) is not subject to another licensure or approval requirement of this title.

Enacted by Chapter 318, 2008 General Session
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Last revised: Thursday, May 28, 2009