What governs the group health insurance plan that covers employees in multiple states?

The governance of a group health insurance plan that covers employees in multiple states is primarily determined by where the master contract was issued. This is because the master contract serves as the foundational document for the insurance coverage and specifies the policy details, including the laws that apply to it. Insurance contracts are subject to the regulations dictated by the state in which the contract is issued, and this state typically has jurisdiction over the policy terms and disputes.

In multi-state scenarios, having a single governing state simplifies the administration of the insurance plan and ensures consistent application of the terms outlined in the master contract across all covered employees regardless of their individual locations. While the state where the majority of employees reside or the insurance company's headquarters may have influence, they do not have the same authoritative status as the state that issued the master contract. Regulations vary significantly by state, making the issuing state critical for compliance and legal obligations.