In general Subject to clause (ii), such term includes coverage offered in connection with a group health plan that has fewer than 2 participants as current employees or participants described in section 732(d)(3) on the first day of the plan year. (ii) State exception Clause (i) shall not apply in the case of health insurance coverage offered in a State if such State regulates the coverage described in such clause in the same manner and to the same extent as coverage in the small group market (as defined in section 2791(e)(5) of the Public Health Service Act ) is regulated by such State. (8) Participating employer The term participating employer means, in connection with an association health plan, any employer, if any individual who is an employee of such employer, a partner in such employer, or a self-employed individual who is such employer (or any dependent, as defined under the terms of the plan, of such individual) is or was covered under such plan in connection with the status of such individual as such an employee, partner, or self-employed individual in relation to the plan. (9) Applicable state authority The term applicable State authority means, with respect to a health insurance issuer in a State, the State insurance commissioner or official or officials designated by the State to enforce the requirements of title XXVII of the Public Health Service Act for the State involved with respect to such issuer. (10) Qualified actuary The term qualified actuary means an individual who is a member of the American Academy of Actuaries. (11) Affiliated member The term affiliated member means, in connection with a sponsor— (A) a person who is otherwise eligible to be a member of the sponsor but who elects an affiliated status with the sponsor, (B) in the case of a sponsor with members which consist of associations, a person who is a member of any such association and elects an affiliated status with the sponsor, or (C) in the case of an association health plan in existence on the date of the enactment of the