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054.00.119-14. Annual Statements of Self-Funded MEWAs and Renewal Requirements

AR ADC 054.00.119-14Arkansas Administrative CodeEffective: December 5, 2019

West's Arkansas Administrative Code
Title 054. Insurance Department
Division 00.
Rule119. Multiple-Employer Welfare Benefits Plan
Effective: December 5, 2019
Ark. Admin. Code 054.00.119-14
054.00.119-14. Annual Statements of Self-Funded MEWAs and Renewal Requirements
Currentness
(a) Each self-funded multiple-employer welfare arrangement transacting business in this state shall file annually with the Commissioner statements and reports described in paragraphs (1) and (2) of this subsection, as follow [FN1]:
(1) within 90 days of the end of the MEWA's fiscal year, financial statements audited by a certified public accountant, or within such time period as extended by the Commissioner for good cause; and
(2) within 90 days of the end of the MEWA's fiscal year, or within such time period as extended by the Commissioner for good cause, an actuarial opinion prepared and certified by an actuary who is not an employee of the multiple-employer welfare arrangement and who is a fellow of the Society of Actuaries, a member of the American Academy of Actuaries, or an enrolled actuary under the Employee Retirement Income Security Act of 1974 (29 United States Code § 1241 and § 1242). The actuarial opinion shall include:
(A) a description of the actuarial soundness of the multiple-employer welfare arrangement, including any recommended actions that the multiple-employer welfare arrangement should take to improve its actuarial soundness;
(B) the recommended amount of cash reserves the multiple-employer welfare arrangement should maintain which shall not be less than the greater of 20% of the total contributions in the preceding plan year or 20% of the total estimated contributions for the current plan year;
(C) a calculation of cash reserves with proper actuarial regard for known claims, paid and outstanding, a history of incurred by not reported claims, claims handling expenses, unearned premium, an estimate for bad debts, a trend factor, and a margin for error; and
(D) the recommended level of specific and aggregate stop-loss insurance the multiple-employer welfare arrangement should maintain.
(b) The cash reserves as required by the Finance Division of the Arkansas Insurance Department shall be maintained in cash or federally guaranteed obligations of less than five-year maturity that have a fixed or recoverable principal amount or such other investments as the Commissioner has authorized by rule.
(c) The Commissioner shall review the statements and reports required by subsection (a) of this section. The Commissioner shall automatically renew a multiple-employer welfare arrangement's certificate of authority on January 1 of each year unless the Commissioner finds that the multiple-employer welfare arrangement does not meet the requirements of this Rule. At renewal, a self-funded MEWA shall provide the reports or statements required in this Section in addition to any modifications of documents required under Section(s) Six (6), Seven (7), Eight (8) and Twelve (12) which have changed from the previous plan year.

Credits

Adopted Dec. 5, 2019.
[FN1]
So in original.
Current with amendments received through February 15, 2024. Some sections may be more current, see credit for details.
Ark. Admin. Code 054.00.119-14, AR ADC 054.00.119-14
End of Document