In Florida, many marketers (including licensed insurance agents) of health benefit plans with insurance like-coverage, tell their customers that the plans are not regulated by the Department of Insurance, now known as the Department of Financial Services. The explanation given is that the Florida Insurance Code is preempted by the Federal Employee Retirement Income Security Act, or ERISA as it is commonly known. Furthermore, customers are told that the U.S. Department of Labor, or DOL as it is often called, regulates the health benefit plan but not the Florida Department of Financial Services.

Florida consumers should be very concerned as to the accuracy of any representation that such health benefit plans are not subject to the Florida Insurance Code. In almost every instance, these representations are incorrect, despite any sales pitch to the contrary. Florida consumers should keep in mind that the Florida Insurance Code exists for their protection. As such, if the Insurance Code does not apply, then very valuable consumer protections are lost, which may mean that the consumer's medical bills will not be paid and that the consumer's premium dollars have been spent for nothing.

In these situations, the Florida consumer should always ask, does ERISA really preempt the Florida Insurance Code relative to the health benefit plan that I am thinking about purchasing. In most instances, if the same benefit plan is being actively marketed to two or more employers (including two or more self-employed individuals), the insurance aspects of the benefit plan are subject to the Florida Insurance Code. This means that the insurance aspects of the benefit plan must have a certificate of authority or license from the Department of Financial Services in order for the plan to be legally operating in Florida.

Florida consumers should keep in mind that when the United States Congress passed the ERISA law, it did not intend for these types of health benefit plans to be marketed on an entrepreneurial venture basis. Congress intended that financial contributions to an ERISA qualified health benefit plan be returned to the beneficiaries of the plan in the form of health benefits. As such, if a health benefit plan is being actively marketed, someone is making a profit, and chances are the plan would not be an ERISA qualified plan that preempts the Florida Insurance Code.

With this in mind, here are some simple guidelines:

1. The only health benefit plan that preempts the Florida Insurance Code, is the truly single employer ERISA qualified plan that is 100% self-insured. This means that only the employees and their dependents of that specific employer get the benefits of that specific health benefit plan. Furthermore, that the health benefits are paid for by way of contributions to the plan that are made by that employer, that employer's employees, or a combination of contributions by both. Furthermore, that the sales commission or profit motive has been removed from the equation.

2. On the other hand, even if the single employer ERISA qualified health benefit plan is fully insured or partially insured by an insurance company, the Florida Insurance Code still applies to the insurance company and the insurance policies. This means the insurance company must have a Florida Department of Financial Services' certificate of authority and the insurance company's policy forms and rates must be filed with and approved by the Department.

3. If on the other hand, a health benefit plan is marketed to two or more employers (including one or more self-employed individuals); then, under ERISA, the plan is no longer a single employer plan, rather it is called a Multiple Employee Welfare Benefit plan or MEWA. If the health benefit plan is a MEWA, ERISA itself provides that the Florida Insurance Code is never preempted. Therefore, if the health benefit plan is a MEWA; then, there must be a Florida Department of Financial Services' certificate of authority in order for the benefit plan to be legally operating in Florida.

4. Union health benefit plans without a DOL finding as to the legitimacy of the collective bargaining agreements, employee leasing health benefit plans, association health benefit plans, and health benefit plans otherwise marketed to two or more Florida employers or self-employed individuals are invariably considered MEWAs. Therefore, the insurance aspects of such MEWA plans are subject to the Florida Insurance Code, which means a Florida Department of Financial Services' certificate of authority is required.

5. When contemplating the purchase of a health benefit plan, the safest bet is to always make sure that the health coverage is licensed by way of a Florida Department of Financial Services' certificate of authority.

Finally, Florida consumers should always keep in mind – if the health plan benefits that are being purchased are too good to be true based on the premium being charged and the consumer's health condition, it is too good to be true. The buyer should always beware.