South Carolina H 4305: Wellness reimbursement program

Bill Text

2025-2026 Bill 4305 Text of Previous Version (May. 07, 2026) - South Carolina Legislature Online 

South Carolina General Assembly
126th Session, 2025-2026

Bill 4305

Indicates Matter Stricken
Indicates New Matter

(Text matches printed bills. Document has been reformatted to meet World Wide Web specifications.)

Indicates Matter Stricken

Indicates New Matter

Amended

May 6, 2026

H. 4305

Introduced 
by Rep. Herbkersman 

S. Printed 5/6/26--S. [SEC 
5/7/2026 11:35 AM]

Read the first time May 6, 2025

________

A bill

TO AMEND THE SOUTH CAROLINA CODE OF LAWS BY ADDING ARTICLE 
25 TO CHAPTER 71, TITLE 38 ENTITLED "WELLNESS REIMBURSEMENT PROGRAMS" SO AS TO 
DEFINE TERMS, PROHIBIT CERTAIN ACTS BY WELLNESS REIMBURSEMENT PROGRAMS, REQUIRE 
REGISTRATION INCLUDING AN APPLICATION AND FEES WITH THE SECRETARY OF STATE, 
EXEMPT BROKERS FROM REGISTERING, AND TO PROVIDE FINES FOR FAILING TO REGISTER 
WHEN REQUIRED.

 Amend Title To Conform

Be it enacted by the 
General Assembly of the State of South Carolina:

SECTION 1. Title 38 of the S.C. Code is amended by adding:

CHAPTER 105

Wellness Reimbursement Programs

 Section 
38-105-10. As used in this chapter:

 (1) 
"Broker" means an independent health insurance agent licensed in this State.

 (2) 
"Director" means the director of the Department of Insurance or his designee.

 (3) 
"Person" means a natural person, corporation, mutual company, unincorporated 
association, partnership, joint venture, limited liability company, trust, 
estate, foundation, not-for-profit corporation, unincorporated organization, 
government, or governmental subdivision or agency.

 (4) 
"Wellness reimbursement program" means a self-insured medical reimbursement 
plan or a wellness integrated medical plan expense reimbursement plan:

 (a) 
that is created pursuant to 26 C.F.R. 1.105-11 and Sections 105 and 125 of the 
Internal Revenue Code;

 (b) 
that has issued a contract to provide services and pay claims pertaining to 
reimbursements of qualified medical expenses relating to Section 213(d) of the 
Internal Revenue Code; 

 (c) 
that is intended, created, marketed, and sold as an ancillary product to an 
individual or group health insurance coverage or self-insured group health 
plan; and

 (d) 
the reimbursement funds are not held by a third party administrator.

 "Wellness reimbursement 
program" does not include any underlying individual or group health insurance 
coverage or a self-insured group health plan.

 (5) 
"Wellness reimbursement program administrator" means any person who manages the 
operation of a wellness reimbursement program.

 Section 
38-105-20. (A) No wellness 
reimbursement program administrator may sell, offer, market, promote, or 
operate a wellness reimbursement program without first being licensed by the 
director.

 (B) 
Application for a license must be on forms prescribed by the director and must 
be accompanied by an initial license fee of five thousand dollars, annual 
financial statements or reports for the two preceding calendar years, and any 
other documents that the director may require to ensure that the wellness 
reimbursement program administrator meets the requirements for licensure set 
forth in this chapter. Thereafter, an application fee for a renewal offering 
must be five hundred dollars. These fees must be retained by the director to 
offset the costs of processing and maintaining the registration of wellness 
reimbursement programs required by the chapter.

 (C) 
In addition to the documents required under subsection (B), a wellness 
reimbursement program administrator must comply with Federal ERISA requirements, 
or submit a letter or document from the Internal Revenue Service or the U.S. 
Department of Labor approving of the specific wellness reimbursement program in 
question. 

 (D) A 
wellness reimbursement program administrator must make and keep a full and 
correct record of its business and affairs, and the director shall inspect 
these records at least every three years. The information from these records 
must be furnished to the director on demand, and the original books or records 
must be open to examination by the director when demanded. The cost of the 
examination must be borne by the wellness reimbursement program administrator.

 (E) A 
wellness reimbursement program administrator must file and maintain with the 
director a surety bond in favor of the State executed by a surety company 
authorized to transact business in this State. The director may set the 
requirements of such surety bond as necessary.

 (F) 
Before granting any license, the director or his designee must be satisfied 
that the wellness reimbursement program administrator is competent, 
trustworthy, financially responsible, has a good personal and business 
reputation, has not had an insurance license revoked, suspended, or denied in 
any jurisdiction within the preceding five years, and has not been convicted of 
a crime involving fraud, dishonesty,