FAQ: MEC Plans, GAP Insurance & Group Captives

Northgate Benefit Group LLC is a managing general agency (MGA), wholesaler, and benefits program manager headquartered in Florida. We work exclusively through licensed brokers and benefits consultants to design and administer benefit programs — MEC/MVP ACA compliance plans, true self-funded health plans, Group GAP insurance, and voluntary benefits — for variable-hour, part-time, seasonal, 1099, and full-time workforces. 

No. Northgate distributes exclusively through licensed insurance brokers and benefits consultants. If you’re an employer interested in our programs, we’ll connect you with a licensed broker partner. 

Northgate Benefit Group operates exclusively through broker partnerships — it does not sell directly to employers. Brokers and benefit consultants collaborate with Northgate to provide their employer clients access to MEC plans, accident insurance, and GAP supplement plans within the captive structures that Northgate administers. Partners benefit from competitive commissions, dedicated account support, and access to Northgate's comprehensive enrollment and claims administration platform. Northgate's model is purpose-built to complement, not compete with, existing broker relationships, especially in the realm of employer-sponsored benefits.

Group GAP insurance is an essential component of major medical benefit plans, as it helps to fill the financial gap between what a major medical plan covers and an employee actually owes out of pocket. When a covered member faces a hospital stay, surgery, or other high-cost claims, their base medical plan—particularly if it’s a high-deductible plan—can leave them responsible for a significant deductible, coinsurance, and copays that can accumulate into the thousands. Group GAP offers reimbursement for eligible out-of-pocket expenses, either up to the deductible or, depending on the plan design, up to the maximum out-of-pocket limit, effectively reducing or even eliminating the financial burden on the member.

Our supplemental benefit programs—including GAP coverage, hospital indemnity, critical illness, and accident insurance—are designed to complement your existing major medical plan, not replace it. These benefits, which include limited medical options, qualify as excepted benefits under ACA regulations, ensuring they do not interfere with your current MEC plans or trigger additional compliance requirements.

Employers use MEC (Minimum Essential Coverage) plans to satisfy the ACA employer mandate for variable-hour employees who average 30+ hours per week and therefore count as full-time under §4980H. A MEC plan is the lowest-cost way to make a qualifying offer of coverage and eliminate the §4980H(a) penalty — $3,340 per full-time employee in 2026 — without funding a full major medical plan. 

A MEC plan satisfies the Affordable Care Act requirement for employers to offer coverage as part of their employer-sponsored benefits, but it doesn't meet the minimum value standard, which requires a plan to pay at least 60% of covered benefits. MEC plans are particularly beneficial for part-time or variable-hour employees working under 30 hours per week or those who are unlikely to seek exchange subsidies.

Yes, MEC plans can be paired with benefits such as accident insurance, limited medical coverage, hospital indemnity, and other voluntary benefits. This combination creates a comprehensive package for employees without access to major medical. The MEC-plus-supplemental model ensures ACA compliance while providing meaningful financial protection.

Limited medical plans, which can include accident insurance, are suitable for employees lacking access to benefits like major medical coverage, especially part-time, variable-hour, or seasonal workers. These MEC plans offer affordable first-dollar coverage for routine medical services and can effectively bridge the gap during waiting periods before qualifying for major medical eligibility.

Accident insurance provides a fixed cash benefit directly to employees when they suffer a covered accidental injury, such as a fracture, dislocation, or emergency room visit. These benefits are paid regardless of other coverage, making them especially valuable as employer-sponsored benefits. Employees can utilize the payout for medical bills, rent, or lost wages, which greatly appeals to hourly and blue-collar workforces that face a higher risk of occupational injury.

A group captive is an innovative insurance arrangement where multiple employers collaborate to pool their risk through a shared captive insurance company, reducing reliance on traditional commercial carriers for accident insurance. Within this structure, each employer maintains a dedicated cell within the captive, allowing for tailored solutions. Premiums are directed to an admitted fronting carrier, which issues the policy and transfers the majority of risk back to the captive via a quota-share reinsurance treaty. Employers with strong claims experience can benefit from dividends at year-end, enhancing their employer-sponsored benefits. Northgate Benefit Group utilizes a Tennessee-domiciled group captive structure to provide this model specifically for MEC plans and supplemental health plans.

A captive structure saves employers money by returning the underwriting margin — the profit a commercial carrier would keep — to the employers themselves. In a traditional fully insured arrangement, the carrier retains 20–30% of premium as profit and overhead. In a captive program, that margin flows back to participating employers as dividends when claims experience is favorable. This is particularly beneficial for employers who offer voluntary benefits as part of their employer-sponsored benefits package. Employers also gain visibility into their own claims data, which lets them manage utilization more proactively. Northgate's captive model targets 45–55% loss ratios, with surplus returned annually.