H464 - Small Business Health Care Act Summary

• Establishes standards for Association Health Plans (AHPs) in North Carolina by adding Article 50A to Chapter 58 of the General Statutes, allowing sponsoring associations to offer fully insured group health insurance to their employer members.

• Requires sponsoring associations to meet multiple requirements including: five-year establishment period, minimum 500 eligible persons, registration as a multiple employer welfare arrangement, board governance with employer member representation, and a minimum net worth equal to one month's premium held in trust.

• Limits AHP eligibility to employer members domiciled in North Carolina or with principal offices/headquarters in the state, and restricts coverage to eligible employees, IRS Form 1099 contractors, and their spouses and dependents, with a mandatory two-year commitment period.

• Mandates AHPs provide at least 60% actuarial value of allowed costs, cover hospital and physician services, cover essential health benefits, prohibit discrimination based on health status, and prevent preexisting condition limitations.

• Takes effect January 1, 2020, and applies to contracts entered into, amended, or renewed on or after that date.