13-1617. Governing body; self-funded portion of employee benefit plan; requirements; confidentiality; violations; penalty.

(1) The governing body of the plan sponsor shall approve the use of any self-funding for its employee benefit plan.

(2) The self-funded portion of an employee benefit plan shall comply with the Political Subdivisions Self-Funding Benefits Act. The self-funded portion of the employee benefit plan shall be solely for the benefit of the employees and dependents of the plan sponsor and shall not be pooled with the self-funded portion of an employee benefit plan of another plan sponsor.

(3) Each plan sponsor shall be liable for payment of valid claims under its employee benefit plan.

(4) The governing body of the plan sponsor shall annually review the self-funded portion of the employee benefit plan for compliance with section 13-1619.

(5) The plan sponsor shall keep confidential employee benefit plan information held by it which personally identifies employees and their dependents and the nature of any claims submitted by employees and their dependents. Any agent of the plan sponsor shall not use or disclose any such information to any person except to the extent necessary to administer claims or as otherwise authorized by law. No information regarding claims submitted by employees and their dependents and held by the plan sponsor shall be used directly or indirectly to alter the terms and conditions of employment of the employees. Any plan sponsor, member of its governing body, officer, employee, or agent who knowingly or willfully violates this subsection shall be guilty of a Class III misdemeanor.

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