Association Group Coverage Changes

Trade Associations in Kentucky are being asked to show that they meet ERISA “bona fide association” requirements in order to continue to provide group health insurance for their members under health reform requirements effective in 2014.  Such group health insurance may be a more affordable option for some businesses as new health reform requirements begin to take effect.

In a nutshell, ERISA requires that an association be considered an “employer” to sponsor a group health plan at the association level.  In order to qualify as an “employer”, an association must meet bona fide association requirements, including like-industry and participant control requirements.  By sponsoring a group health insurance plan at the association (rather than the individual employer) level, associations are able to pass along to their employer members reduced coverage premiums available under large group plans.

Important health reform changes are applicable to insurance plan renewals occurring on or after January 1, 2014.  Trade associations should act now to confirm that they are structured to be eligible to purchase group insurance coverage, if their member benefits include health care coverage.  If you need help restructuring your association for this purpose or have questions, contact Clay Wortham in the Lexington office. He can be reached at or at (859) 231-8780.


Clay B. Wortham is an Associate of McBrayer, McGinnis, Leslie & Kirkland, PLLC.  Mr. Wortham concentrates his practice in healthcare law and is located in the firm’s Lexington office.  He can be reached at or at (859) 231-8780.

This article is intended as a summary of state law and does not constitute legal advice.

Article originally appeared on McBrayer’s Health Care Law blog, 

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Mr. Amato has practiced law throughout Kentucky since his graduation from the University of Kentucky College of Law in 1990. He has been nominated and identified in Kentucky Super Lawyers® for six consecutive years, 2007, 2008, 2009, 2010, 2011 and 2012. His practice is diverse, focusing on civil litigation and administrative law. His litigation practice is focused primarily on employment law, representing employers in all state and federal trial courts, state and local administrative agencies, and throughout the respective courts of appeal. Employment-related issues with which Mr. Amato has particular experience include, the enforcement of no-compete agreements, the investigation and defense of discrimination claims, and the negotiation and enforcement of severance agreements. In addition, Mr. Amato has significant litigation experience in governmental entity defense, including specific experience in defending local governments, governmental agencies and government officials in connection with claims brought against them under both state and federal law, including § 1983, negligence claims, and state constitutional claims, for alleged deliberate indifference to medical needs, excessive force claims, negligence claims and employment claims. Mr. Amato's administrative practice focuses extensively in the area of alcoholic beverage regulation, primarily representing the interests of alcoholic beverage retailers and distributors in connection with licensing and enforcement issues at both the state and local levels.

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