2022 Colorado Code
Title 10 - Insurance
Article 3 - Regulation of Insurance Companies
Part 9 - Unauthorized Insurance
§ 10-3-903.5. Jurisdiction Over Providers of Health-Care Benefits - Rules

1. Notwithstanding any other provision of law, and except as provided in this section, any person or other entity which provides coverage in this state for medical, surgical, chiropractic, physical therapy, speech pathology, audiology, professional mental health, dental, hospital, or optometric expenses, whether such coverage is by direct payment, reimbursement, or otherwise, shall be presumed to be subject to the jurisdiction of the division of insurance, unless such person or entity shows that while providing such services it is subject to the jurisdiction of another agency of this state, any subdivisions thereof, or the federal government.
2. A person or other entity may show that it is subject to the jurisdiction of another agency of this state, any subdivision thereof, or the federal government, by providing to the insurance commissioner the appropriate certificate, license, or other document issued by the other governmental agency which permits or qualifies it to provide those services. Nothing in this section shall be construed to in any way limit the ability of the division of insurance to regulate insurance companies, multiple employer trusts, multiple employer welfare arrangements, association health plans, or preferred provider organizations.
3. Any person or other entity which is unable to show under subsection (2) of this section that it is subject to the jurisdiction of another agency of this state, any subdivision thereof, or the federal government, shall submit to an examination by the insurance commissioner to determine the organization and solvency of the person or the entity, and to determine whether such person or entity complies with the applicable provisions of this article.
4. Any person or other entity unable to show that it is subject to the jurisdiction of another agency of this state, any subdivision thereof, or the federal government, shall be subject to all appropriate provisions of this article regarding the conduct of its business.
5. Any production agency or administrator which advertises, sells, transacts, or administers the coverage in this state described in subsection (1) of this section and which is required to submit to an examination by the insurance commissioner under subsection (3) of this section, shall, if said coverage is not fully insured or otherwise fully covered by an admitted sickness and accident insurer, nonprofit hospital, medical, surgical, and health service corporation, prepaid dental care plan, or health maintenance organization, advise every purchaser, prospective purchaser, and covered person of such lack of insurance or other coverage.
6. Any administrator which advertises or administers the coverage in this state described in subsection (1) of this section and which is required to submit to an examination by the insurance commissioner under subsection (3) of this section, shall advise any production agency of the elements of the coverage, including the amount of "stop-loss" insurance in effect.
7. 1. The provisions of this section and any other laws of this state that regulate insurance or insurance companies shall not apply to any multiple employer health trust which meets the requirements of paragraph (b) of this subsection (7) or any multiple employer welfare arrangement which meets the requirements of paragraph (c) of this subsection (7). Any such trust or arrangement shall be subject to the requirements of this subsection (7) and section 10-3-1104. The exemption provided by this subsection (7) shall not apply to any entity if the division of insurance determines that its operation is hazardous to the public or to individuals receiving benefits.
   2. A multiple employer health trust is any trust that is:
      1. Sponsored, maintained, and funded by one or more entities of state government or political subdivisions of the state organized pursuant to state law and is for the benefit of the entity's employees, including a multiple employer health trust established for the purposes of part 3 or 4 of article 5 of title 29; or
      2. Established and maintained pursuant to the provisions of a collective bargaining agreement between one or more unions and employers or an association of employers for the benefit of employees who are covered by such agreement, and pursuant to which health benefits, wages, pension benefits, and other terms of employment have been bargained for in good faith and the sponsoring union provides services and benefits to its members other than health benefits.

   3. A multiple employer welfare arrangement is any arrangement that complies with either the following requirements or subsection (7)(d) of this section:
      1. The multiple employer welfare arrangement shall have been in existence continuously since at least January 1, 1983, and shall maintain unallocated reserves of not less than five percent of the first two million dollars of annual contributions made to such arrangement in the preceding year.
      2. The multiple employer welfare arrangement shall file its annual financial statement with the division within sixty days after the end of its fiscal year to demonstrate that the required reserves are being maintained, and it shall file its audited financial statement with the division within the time period that insurance companies are required to file such statements.
      3. The multiple employer welfare arrangement shall file an actuarial opinion with the division which states that the reserves and the contribution and funding levels of the arrangement are adequate and which includes the underlying actuarial report in support of the opinion in accordance with the requirements of section 10-7-114, and such arrangement shall file such opinion and report within the time period that insurance companies are required to file such actuarial opinion.
      4. The multiple employer welfare arrangement shall provide benefits which are in substantial compliance with the mandated benefit provisions that are applicable to insurers offering health insurance coverage in this state.
      5. The multiple employer welfare arrangement shall be sponsored and maintained by an association which:
         1. Has within its membership the employers who participate in and fund the arrangement;
         2. Is engaged in substantial activities for its employer members, other than the sponsorship of an employee welfare benefit plan, and provides business or professional assistance and benefits to its members who share a common business interest and are primarily engaged in the same trade or business; and
         3. Has been in existence for a period of at least ten years.
         4. Criminal background records. Each individual specified in subsection (7)(d)(I)(C) of this section shall submit a set of fingerprints to the commissioner. The commissioner shall forward the fingerprints to the Colorado bureau of investigation for the purpose of conducting a state and national fingerprint-based criminal history record check utilizing records of the Colorado bureau of investigation and the federal bureau of investigation. The multiple employer welfare arrangement shall bear only the actual costs of the record check. When the results of a fingerprint-based criminal history record check of an individual performed pursuant to this subsection (7)(d)(I)(D) reveal a record of arrest without a disposition, the commissioner shall require that individual to submit to a name-based criminal history record check, as defined in section 22-2-119.3 (6)(d).
         5. A copy of the policy, contract, certificate, summary plan description, or other evidence of the benefits and coverages provided to covered employees, including for each form of evidence a table of the rates charged or proposed to be charged;
         6. A copy of the multiple employer welfare arrangement's stop-loss or excess insurance agreement, if any;
         7. A copy of audited financial statements of the multiple employer welfare arrangement for the previous five years that were prepared by a licensed certified public accountant, including an actuarial opinion; and
         8. A copy of every contract between the multiple employer welfare arrangement and its administrator or service company, including, if applicable, a copy of the fidelity bond specified in subsection (7)(d)(II)(C) of this section.

   4. 1. A multiple employer welfare arrangement that meets the requirements specified in subsection (7)(c) of this section other than subsection (7)(c)(I) of this section may file an application for a waiver with the commissioner. A multiple employer welfare arrangement that meets the requirements specified in subsection (7)(c) of this section other than those specified in subsections (7)(c)(I) and (7)(c)(V)(B) of this section may also file an application for a waiver with the commissioner. The application must include:
      2. To qualify for a waiver, a multiple employer welfare arrangement must:
         1. Maintain unallocated reserves of not less than two million dollars of minimum surplus; except that the commissioner may, by rule, increase the minimum surplus consistent with the standards of the national association of insurance commissioners;
         2. Be managed by and provide benefits through an administrator or service company that is in good standing in all other states in which the administrator or service company operates, and if the multiple employer welfare arrangement provides coverage through one or more brokers, the brokers must be licensed as producers pursuant to article 2 of this title 10;
         3. Be managed by an administrator or service company that is a licensed third-party administrator or is covered by a fidelity bond in the amount of two hundred thousand dollars;
         4. Maintain a complaint system that complies with article 11 of this title 10 and make the system available to the division upon request;
         5. File the multiple employer welfare arrangement's plan marketing materials with the division;
         6. Provide to the commissioner quarterly financial statements to demonstrate that the reserves required pursuant to subsection (7)(d)(II)(A) of this section are being maintained along with annual audited financial reports;
         7. Provide nondiscriminatory plan coverage to its members that is applied evenly and equitably to all employees of the members and that matches what is otherwise required of health benefit plans, including: Coverage of essential health benefit plans and compliance with the federal "Patient Protection and Affordable Care Act", Pub.L.111-148, as amended; coverage of state-mandated health benefits as required by section 10-16-104; network provider requirements and compliance with network adequacy standards as required by section 10-16-704; and guarantee issue requirements, including that all multiple employer welfare arrangement members and their employees must be eligible to purchase insurance;
         8. Not condition membership on health-status-related factors related to an individual or exclude an employer from membership because of the health status of the employees of the employer. Health-status-related factors include: Health status; medical condition, including both physical and mental illness, as defined in 45 CFR 144.103; and evidence of insurability or disability.
         9. Not charge different premium rates, alter cost sharing, or change benefit levels based on health-status-related factors of a multiple employer welfare arrangement member group or individual employee of that group;
         10. Not make health insurance coverage offered through the arrangement available other than in connection with a member of the multiple employer welfare arrangement; and
         11. File annual rate and form filings with the division as specified by the commissioner by rule.

      3. The commissioner shall consider granting a waiver to a multiple employer welfare arrangement that has submitted a complete application pursuant to subsection (7)(d)(I) of this section and that is in compliance with subsection (7)(d)(II) of this section in accordance with the following factors:
         1. Whether the establishment of a multiple employer welfare arrangement has the potential to lower insurance costs for its members or provide additional insurance options in a region or regions of the state where there may not be sufficient competition;
         2. Potential impact on the fully insured market;
         3. Consumer experience with accessing coverage and the potential for consumer harm;
         4. Whether the administrator of the multiple employer welfare arrangement has demonstrated financial soundness so as to not jeopardize the viability of the arrangement or harm its members; and
         5. The length of time the multiple employer welfare arrangement has been in existence.

      4. A waiver granted pursuant to this subsection (7)(d) subjects the multiple employer welfare arrangement to the division's full enforcement authority available pursuant to this title 10 and allows the arrangement to operate pursuant to this subsection (7) for two years. To continue to operate pursuant to this subsection (7), an arrangement must reapply for a waiver; except that, if the commissioner grants five consecutive waivers pursuant to this subsection (7)(d), an arrangement may continue to operate pursuant to this subsection (7) without again applying for a waiver. An arrangement operating pursuant to this subsection (7)(d) remains subject to the division's full enforcement authority under this title 10, and the division may apply any requirement in this title 10 applicable to health insurance carriers to the arrangement as long as the multiple employer welfare arrangement is operating in Colorado.
      5. The commissioner:
         1. Shall adopt rules for the implementation of this subsection (7)(d); and
         2. May waive any of the requirements of subsection (7)(d)(I)(B) of this section for waiver applicants that meet the requirements in subsection (7)(c) of this section other than those specified in subsections (7)(c)(I) and (7)(c)(V)(B) of this section.

      (A) A copy of the multiple employer welfare arrangement's articles of incorporation, constitution, trust agreement, bylaws, and analogous organic documents that govern the operation of the arrangement;

      (B) A copy of membership criteria, a statement of ownership of the multiple employer welfare arrangement's members, and a summary of the activities and benefits, other than health plan coverage, provided to members;

      (C) A list of names, addresses, and official capacities with the multiple employer welfare arrangement of the individuals who will be responsible for the management and conduct of the affairs of the arrangement, including all trustees, officers, and directors, along with a full disclosure of the extent and nature of any contracts between the individuals and the arrangement, including possible conflicts of interest;

Source: L. 91: Entire section added, p. 1206, § 3, effective July 1. L. 93: (7) added, p. 256, § 1, effective March 31. L. 2014: IP(7)(b) and (7)(b)(I) amended, (SB 14-172), ch. 325, p. 1427, § 2, effective January 1, 2015. L. 2017: (7)(b)(I) amended, (SB 17-214), ch. 187, p. 684, § 4, effective May 3. L. 2021: IP(7)(c) amended and (7)(d) added, (SB 21-063), ch. 467, p. 3360, § 1, effective September 7.

Editor's note: Section 4 of chapter 467 (SB 21-063), Session Laws of Colorado 2021, provides that the act changing this section applies to conduct occurring on or after September 7, 2021.