A MEWA lets unrelated employers band together to offer health benefits as a group, aiming for economies of scale. Because self-funded MEWAs have a history of insolvency and fraud, they are heavily regulated under both ERISA and state law.
Captives & MEWAs
Group captives and Multiple Employer Welfare Arrangements (MEWAs) let employers pool risk to fund benefits. These FAQs explain how each works and the trade-offs involved.
What is a group captive for health benefits?
A group captive is an insurance company owned by the employers it insures. For health benefits, mid-size employers join a captive to share stop-loss risk, gain pricing stability and claims data, and potentially share in surplus, while limiting any single member’s exposure.