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(1) A client and a professional employer organization licensed under this chapter shall each be considered an employer for purposes of sponsoring a retirement or welfare benefit plan for a covered employee.
(2)
(a) A fully insured welfare benefit plan offered to a covered employee of a single professional employer organization licensed under this chapter is to be treated as a single employer welfare benefit plan for purposes of this title and rules made under this title.
(b) The single professional employer organization that sponsors the fully insured welfare plan is exempt from the registration requirements under this title for:
(i) an insurance provider; or
(ii) an employer welfare fund or plan.
(3) For purposes of Chapter 30, Individual, Small Employer, and Group Health Insurance Act:
(a) a professional employer organization licensed under this chapter is considered the employer of a covered employee; and
(b) all covered employees of one or more clients participating in a health benefit plan sponsored by a single professional employer organization licensed under this chapter are considered employees of that professional employer organization.
(4) A professional employer organization licensed under this chapter may offer to a covered employee a health benefit plan that is not fully insured by an authorized insurer, only if:
(a) the professional employer organization has operated as a professional employer organization for at least one year before the day on which the professional employer organization offers the health benefit plan; and
(b) the health benefit plan:
(i) is administered by a third-party administrator licensed to do business in this state;
(ii) holds all assets of the health benefit plan, including participant contributions, in a trust account;
(iii) has and maintains reserves that are sound for the health benefit plan as determined by an actuary who:
(A) uses generally accepted actuarial standards of practice; and
(B) is an independent qualified actuary, including not being an employee or covered employee of the professional employer organization;
(iv) provides written notice to a covered employee participating in the health benefit plan that the health benefit plan is self-insured or is not fully insured;
(v) consents to an audit:
(A) on a random basis; or
(B) upon a finding of a reasonable need by the commissioner; and
(vi) provides for continuation of coverage in compliance with Section 31A-22-722.
(5) The cost of an audit described in Subsection (4)(b)(v) shall be paid by the sponsoring professional employer organization.
(6) A plan of a professional employer organization described in Subsection (4) that is not fully insured:
(a) is subject to the requirements of this section; and
(b) is not subject to another licensure or approval requirement of this title.