MET’s & MEWA’s

Providing group insurance to multiple employer welfare arrangements (MEWAs) can be difficult for a number of reasons.

First, MEWAs are group health plans that are sponsored by an association or other entity that is not an employer, and are not regulated in the same way as traditional group health plans that are sponsored by an employer. MEWAs are subject to different rules and regulations under state and federal law, which can make it difficult for insurers to accurately assess and price the risks associated with providing coverage to MEWA members.

Second, MEWAs may have a high level of variability in their membership, with individuals joining and leaving the MEWA at different times. This can make it difficult for insurers to accurately predict the size and composition of the MEWA's membership, which can impact the insurer's ability to accurately price the insurance coverage.

Finally, MEWAs may also have a higher level of administrative complexity due to the multiple employers that are participating in the arrangement, which can make it more difficult for insurers to manage the claims and billing processes.

Overall, the combination of these factors can make it more difficult for insurers to provide group insurance to MEWAs, which may result in higher premiums or more limited coverage options for MEWA members. However, with careful planning and research, T&O can help MEWA’s find suitable insurance plans that meets the needs of their members while also being financially feasible.

T&O helps Trusts facing challenges in obtaining good group insurance. The challenges we contend with and deliver solutions include:

Regulation: MEWAs are subject to state insurance regulation, which can vary significantly from one state to another. This can make it difficult for insurers to offer coverage to MEWAs that operate in multiple states.

Risk pooling: MEWAs often have a diverse membership, which can make it difficult to pool risk and accurately predict the cost of coverage. This can make it challenging for insurers to accurately price policies for MEWAs.

Solvency: MEWAs are self-insured, which means that they are responsible for paying claims out of their own assets. If a MEWA experiences a high volume of claims, it could potentially become insolvent, which would leave its members without coverage.

Overall, providing group insurance to MEWAs can be complex and challenging due to the regulatory environment, risk pooling, solvency concerns, and potential for fraud.

There are several reasons why it can be difficult to provide group insurance to multiple employer welfare arrangements (MEWAs):

A multiple employer welfare arrangement (MEWA) is a type of group health insurance plan that is sponsored by a group of employers or associations rather than a single employer. MEWAs are regulated by the Employee Retirement Income Security Act (ERISA) and are subject to state insurance laws.

A multiple employer trust (MET) is a type of pension plan that is sponsored by a group of employers or associations rather than a single employer. METs are also regulated by ERISA and are subject to state laws.

The main difference between a MEWA and a MET is the type of benefit they provide. MEWAs provide group health insurance coverage, while METs provide retirement and pension benefits. Both types of arrangements are designed to allow small employers or associations to pool their resources and offer benefits to their employees or members that they might not be able to offer individually.

A multiple employer trust (MET) is a type of pension plan that is sponsored by a group of employers or associations rather than a single employer. METs are regulated by the Employee Retirement Income Security Act (ERISA) and are subject to state laws.

While METs are primarily used to provide retirement and pension benefits, they can also be used to provide other types of benefits, such as group health insurance coverage. However, it is important to note that a MET is not the same as a multiple employer welfare arrangement (MEWA), which is specifically designed to provide group health insurance coverage to employees of participating employers.

If an MET wishes to provide group health insurance benefits, it must comply with all relevant state and federal insurance laws, including those that regulate MEWAs. It is important for employers to carefully review the terms of any group health insurance plan, including those offered through an MET, to ensure that they meet the needs of their employees and comply with all applicable laws.