As insurance costs continue to rise, small employers are looking for ways to maintain benefits. In response to the ACA’s changes some insurance carriers and member organizations are offering alternatives to the ACA marketplace in the form of MEWAs.
MEWA stands for multiple employer welfare arrangement. In a MEWA employers with a common interest or profession join together to form a benefits fund which provides medical benefits along with other benefits, such as dental and vision coverage. This arrangement provides the membership with a voice in decisions. In addition, any profits as a result of cost containment remain within the benefits fund for the membership.
A MEWA is not insurance. Rates are not considered premiums; instead they are referred to as premium equivalent rates. A MEWA acts as a self-funded plan for the groups joined together. In addition it can allow for changes in benefits and contributions without worrying about losing grandmothered or grandfathered status and having to be placed in an ACA plan with ACA community rating.
In order to join a MEWA plan the group must be willing to go through medical underwriting. This generally requires groups to fill out online health questionnaires. In addition, not all groups will have cost benefits from a MEWA plan; however, for many this is a solution to avoiding ACA community rating.
AUI is one of a few limited brokers with access to some MEWA products in Ohio. If you would like to learn more about these products and see if your group is a candidate, please contact us today!
This blogpost is a supplement to our webinar series on Alternative Benefits. If you would like to learn more about our webinar series, please contact us.