Special to Contractor

TRENTON, N.J. — When New Jersey one-man plumbing shops buy health insurance through insurance administrator Association Master Trust, they can thank the New Jersey State League of Master Plumbers, which worked alongside the New Jersey Plumbing-Heating-Cooling Contractors (April, pg. 1).

The League lobbied state lawmakers, regulators and Association Master Trust to get one-man shops health insurance at low group rates. Previously, the legal definition of an employer for insurance purposes meant two or more persons.

New Jersey one-man shops can now buy health insurance if they are a member of one of the 13 associations that participates in Association Master Trust, which is, under state insurance law, called a Multiple Employer Welfare Arrangement. The member associations create subtrusts and elect trustees. One or more of those trustees serves as a trust on AMT, which has 17 trustees.

The associations, in addition to the State League of Master Plumbers, includes NJ-PHCC, the fuel merchants, lumber dealers, gasoline retailers, the motor truck association and the veterinarians association.

AMT represents about 1,500 employers with 10,500 employees. AMT monthly bills contractors and other employers, who paid total employer contributions last year of $75 million.

The League first prodded AMT in April 2004 when the League's attorney, Joseph T. Holahan, asked why one-man shops couldn't get insurance. AMT Chief Operating Officer Harvey Mishkin wrote back that the New Jersey Self-Funded Multiple Employer Arrangement Regulation Act defined an employer as two or more employees.

League Administrator Liz Moritz took the next shot in September 2005, writing to Douglas Wheeler, assistant commissioner of the New Jersey Department of Banking and Insurance.

Elected and politically appointed officials in the state could buy insurance, Moritz pointed out, even though they did not meet any definition of an employer— the positions were not permanent and the officials often worked less than 25 hours a week.

"These individuals, however, do have access to the self-funded health benefit plan offered in municipal, county and state agencies," she wrote.

Wardell Sanders, executive director of the state Department of Banking and Insurance, finally replied in January 2006, saying, basically, thanks for your letter but our hands are tied by insurance law passed by the state legislature. Moritz next implored state Sen. Loretta Weinberg and Assemblyman Neil M. Cohen to change the law to no avail.

The change al lowing one-man shops to buy insurance finally came in a "back-door" manner. League lobbyist Alfred J. Gaburo found proceedings from the Department of Banking and Insurance Division of Insurance published in the New Jersey Register in 2004. In it, the department notes that, "The statute ... defines a ' multiple employer welfare arrangement' by referring to the Employee Retirement Income Security Act." In ERISA, an employer can be one person. The Department of Banking and Insurance declared then that it had to change its rules.

Trustees of the member associations pushed AMT for the change early this year, and AMT trustees approved the change allowing one-man shops in March.