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SB 189

AN ACT PERMITTING CERTAIN SPONSORING ASSOCIATIONS TO CREATE MULTIPLE EMPLOYER WELFARE ARRANGEMENTS.

2025 Regular Session Introduced by Tony Hwang and 2 co-sponsors

Connecticut bill expands which associations can create multiple employer health plans, potentially lowering insurance costs for small businesses but raising regulatory oversight concerns.

REF. TO JOINT COMM. ON Insurance and Real Estate
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Bill Summary · SB 189

Legislative bill overview

SB 189 would allow certain sponsoring associations in Connecticut to establish Multiple Employer Welfare Arrangements (MEWAs), which are health benefit plans that pool employees from multiple small employers together to negotiate better rates and coverage options. Currently, Connecticut law restricts which organizations can sponsor MEWAs. This bill expands eligibility for associations to create and administer these arrangements.

Why is this important

Small employers often struggle to afford health insurance for employees due to high per-capita administrative costs and limited negotiating power with insurers. MEWAs allow small businesses to band together to achieve economies of scale, potentially lowering premiums and expanding coverage options. However, MEWAs have historically faced regulatory challenges because they can pose financial risks if mismanaged or inadequately capitalized.

Potential points of contention

  • Regulatory oversight gaps: Expanding MEWA sponsors increases complexity for state insurance regulators to monitor solvency and prevent fraud, particularly if new sponsoring associations lack experience in health plan administration
  • Consumer protection concerns: Employees covered under MEWAs may have fewer protections than those under traditional group health plans, and inadequate reserve requirements could leave workers without coverage if a MEWA fails
  • Market fragmentation: Allowing more associations to create MEWAs could fragment the small-group insurance market, potentially leaving traditional insurers with higher-risk pools and raising costs for those who remain outside MEWAs

Compiled from official sources — confirm details with the bill’s official record.

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