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MEWAs and the Benefits they Provide Your Business

If you own a small business, then you know the importance of employee health insurance.  

Anything you can do to reduce the cost your business pays for insurance while increasing the benefits provided to your employees goes a long way towards improving your overall bottom line.  

One of the best ways to reduce the amount your business is spending on insurance costs is through Multiple Employer Welfare Arrangements (known as MEWAs).  

In this article, we will go over some of the specific attributes of MEWAs and what they can offer for your small business.  

MEWAs and Your Business 

MEWAs are the basis for group health coverage offered through association health plans. In essence, multiple employers come together through an association to offer employees a health benefit plan.  

Here are some quick notes about MEWAs: 

  • MEWAs are a single health plan for multiple employers.  
  • A MEWA allows smaller employers to have more flexible group plans and more leverage when negotiating with insurance companies and healthcare providers.  
  • Regulated under the federal Employee Retirement Income Security Act of 1974 (ERISA), MEWAs are protected under both federal and state law.  
  • Recent updates to association health plan regulation have reaffirmed the role of state Departments of Insurance in the regulation of MEWAs. 
  • MEWAs have various documentation requirements that include disclosures to the plan participants and filings with government officials.  

Ohio MEWAs, as required by Ohio Revised Code Chapter 1739, allows small businesses of two employees or more, or self-employed individuals, to apply to the superintendent for a Certificate of Authority. This request is directed to the Office of Risk Assessment and includes a $1,000.00 fee payable to the Ohio Treasurer.  

What MEWAs Do and Do Not Include 

While MEWAs do provide small companies with more flexibility when it comes to insurance, there are many misconceptions about what they can and cannot provide.  

Let's clarify some points of confusion regarding MEWAs: 

  • Association health plans are a type of MEWA. 
  • Not all MEWAs are association health plans.  
  • MEWAs are primarily thought of as including health insurance, but they can be used for dental and vision insurance benefits as well. 
  • MEWAs do not require members of an association to have control over their management. 
  • Operations of an association health plan must be controlled by members of the association to be bona fide.  

There are a variety of different MEWAs out there for you to consider, but the most important thing to know is that they give your employees more coverage while you pay less. In addition, the added leverage MEWAs give you while negotiating with insurance providers greatly reduces the stress of coming to an agreed plan with your provider.

MEWAs Simplify Your Business 

MEWAs can seem a complex topic for those just beginning to research them, but once properly used, they make insurance management much easier for small businesses.  

MEWAs provide interconnected small businesses with the same health insurance advantages that large businesses can provide. MEWAs can only be accessed through well-connected associations. 

The Southern Ohio Chamber Alliance (SOCA) is just such an association. At SOCA, we are committed to providing small businesses all over Ohio with maximum insurance benefits at the lowest cost. Reach out to SOCA to find out what we can do for you. 

Get the SOCA advantage today! 

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