:: Regulating Association Health Plans – A Sisyphean Task For State Insurance Departments

Michael Bianchi thinks he has the solution to the nation’s health care crisis: Keep people out of the doctor’s office by paying out benefits that encourage healthy lifestyles.

Want nutritional supplements? No problem. Bianchi’s company, the W.I.N. Association, will pick up the tab. Need a massage, acupuncture or a gym membership? That’s covered, too. Even air and water purification products are considered a benefit.

But “they have to be good ones,” Bianchi told the Utah Legislature’s Administrative Rules Committee on Monday, “because we really want them to be effective.”

“Firm says it has cure for health system”, The Salt Lake Tribune (July 29, 2008)

Like the Greek mythological figure condemned to roll the ancient stone up a hill only to have it return, state regulators must endure the perennial return of association plans conceived and operated in defiance of state law. In Utah, yet another such program has been shut down.

Here’s the essential story of the new Utah plan:

Because every person who enrolls in W.I.N. must sign an employment agreement, the company can call itself a self-funded Association Health Plan (AHP) – making it exempt from state and federal laws that regulate health benefit plans, Bianchi said. Members’ job is to pitch the plan; every new client they sign up earns them a commission.

The new plan comes with a twist – the promoter claims the program has a “verbal” approval to operate as an association health plan exempt from ERISA. The promoter has no written “confirmation” of this approval, however, and the Utah insurance department was unimpressed.

The state’s enforcement action summary and the link to the cease and desist order appear below:

HealthShare America
ChamberHealth U.S.A.
W.I.N. Association
Michael Bianchi
HealthShare Marketing
Edwin D. Wells
;
E-Case #2117;

Order Effective 03-07-08.

Violation(s): 31A-1-104 and 31A-4-106- In doing an insurance business and providing health insurance without obtaining a certificate of authority from the Utah Insurance Department, Respondents are providing unauthorized insurance; 31A-15-102-Respondents HealthShare Marketing and Edwin D. Wells assisted in the marketing and placement of health insurance in the State of Utah by an unauthorized insurer;31A-23a-103 Respondents HealthShare Marketing and Edwin D. Wells acted as insurance producers in the State of Utah, when not licensed to do so.
License Limitation(s):none
Forfeiture(s): none
Additional Activity: Cease and Desist Order issued on
3-07-08