OPINION
The question before us is whether a closely held corporation that subsidized health insurance policies for several of its employees has established an “employee welfare benefit plan” under the Employee Retirement Income Security Act, 29 U.S.C. § 1001, et seq. Here we find that it has. In addition, we hold that a sole shareholder employed by the corporation and insured under the health policy provided by the corporation is a “participant” in the company’s ERISA plan. Accordingly, we affirm the judgment of the district court.
I.
In 1981, Dr. Eugene Madonia founded Martinsville Neurological Associates, Inc. (“MNA”), a Virginia corporation. Since MNA’s founding, Dr. Madonia has served as its director, president, and sole shareholder. In addition to Dr. Madonia, MNA has four other full-time employees: Teresa Anglin, Cynthia Deal, Sheila Martin, and Teresa Smith. Dr. Madonia is the only physician employed by MNA.
On November 7,1988, Dr. Madonia applied for health insurance under the “Virginia Physicians and Their Staffs” group plan offered by Blue Cross & Blue Shield of Virginia (“BC/BS”). BC/BS issued a group policy naming Dr. Madonia as the policy holder and listing his family members as the beneficiaries. Since that time, MNA has paid all premiums for the Madonias’ health insurance and deducted the payments on its corporate tax returns as employee fringe benefits.
MNA’s purchase of the “Virginia Physicians and Their Staffs” policy for Dr. Mado-nia made the remaining MNA employees eligible for coverage under the same group plan by virtue of their employment affiliation with Dr. Madonia. Sheila Martin took advantage of this opportunity by applying for the BC/BS group plan on November 8, 1988. *446 BC/BS accepted her application and provided coverage until November 1991, when Ms. Martin voluntarily discontinued the policy. During that time, MNA made direct payments to BC/BS for Ms. Martin’s monthly premiums. The premiums varied in amount but reached $136.89 in 1991. MNA deducted $50.00 from Ms. Martin’s monthly paycheck for partial reimbursement.
In August 1992, Teresa Anglin, another MNA employee, obtained a health insurance policy from another company, Virginia Farm Bureau. MNA gave Ms. Anglin an interest-free loan for her first monthly premium and increased her salary so that she could afford subsequent monthly premiums. MNA did not pay for or contribute to the other two employees’ health insurance policies.
In 1984, plaintiff-appellant Virginia Mado-nia, Dr. Madonia’s wife, was diagnosed with breast cancer. When the cancer recurred in March 1992, Mrs. Madonia’s physician recommended high dose chemotherapy with an autologous bone marrow transplant (“HDCT-ABMT”). In May 1992, BC/BS informed Mrs. Madonia that HDCT-ABMT was an “experimental” treatment not covered under her policy. Mrs. Madonia sued BC/BS in state court for breach of contract, bad faith breach of contract, intentional infliction of emotional distress, and unfair trade practices. BC/BS removed the ease to federal district court on the ground that Madonia’s suit was governed by the Employee Retirement Income Security Act (“ERISA”), 29 U.S.C. § 1001, et seq. In response, Mrs. Madonia filed a motion to remand.
The district court denied Madonia’s motion for remand. The court found that MNA had established an ERISA “employee welfare benefit plan” by paying for and contributing to three of its employees’ health insurance plans. The court further found that Mrs. Madonia had standing to sue under ERISA as a plan “beneficiary” because Dr. Madonia was an “employee” of MNA and thus a “participant” in MNA’s ERISA plan. Based on these two findings, the court held that remand would be improper because Madonia’s state claims were pre-empted by ERISA under 29 U.S.C. § 1144(a).
This interlocutory appeal followed. See 28 U.S.C. § 1292(b).
II.
ERISA preempts all state claims that “relate to any employee benefit plan.” 29 U.S.C. § 1144(a). In order for Madonia’s state law claims to be preempted by ERISA, two criteria must be met: first, an “employee benefit plan” must exist; second, Madonia must have standing to sue as a “participant” or “beneficiary” of that employee benefit plan. We address each criterion in turn.
A..
Madonia contends that her state law claims are not preempted by ERISA because an “employee benefit plan” did not exist. Our inquiry into the existence of an “employee benefit plan” must begin, as always, with the language of the statute. ERISA defines “employee benefit plan” as either an “employee pension benefit plan” or an “employee welfare benefit plan.” 29 U.S.C. § 1002(3). ERISA further defines “employee welfare benefit plan” as:
any plan, fund, or program which was heretofore or is hereafter established or maintained by an employer or by an employee organization, or by both, to the extent that such plan, fund, or program was established or is maintained for the purpose of providing for its participants or their beneficiaries, through the purchase of insurance or otherwise, (A) medical, surgical, or hospital care or benefits, or benefits in the event of sickness....
29 U.S.C. § 1002(1). This statutory definition can be broken down into five elements: “(1) a ‘plan, fund, or program’ (2) established or maintained (3) by an employer ... (4) for the purpose of providing medical, surgical, hospital care, [or] sickness ... benefits (5) to participants or their beneficiaries.”
Donovan v. Dillingham,
Madonia argues that the second and fifth elements of the above definition have not been met. We think, however, that the evidence shows that MNA established a plan to help its employees obtain health insurance. In our view, this plan meets all five prongs of the Donovan test and therefore constitutes an ERISA “employee welfare benefit plan.”
*447
We note as a threshold matter that a ‘plan, fund, or program” is in existence.
See
29 U.S.C. § 1002(1). MNA’s plan can be defined as a program to assist MNA employees in obtaining and financing health insurance from insurance carriers of their choice. The fact that MNA’s plan respects an employee’s choice of carrier does not render the plan too ill-defined under ERISA. To the contrary, the parameters of MNA’s plan are readily ascertainable: the intended benefit is health insurance coverage; the beneficiaries include MNA’s employees who seek help with their health insurance payments; the source of financing is MNA and its employees; and the procedure for receiving benefits is submission of claims to the employees’ own insurance companies. We therefore conclude that a sufficiently defined “plan” exists.
See Donovan,
Madonia asserts, however, that even if a “plan” exists, MNA’s actions are insufficient to satisfy the second prong of the
Donovan
test — establishment or maintenance of the plan. She claims that MNA did no more than purchase insurance for Dr. Madonia, and that, under
Taggart Corp. v. Life & Health Benefits Admin., Inc.,
In recognition of this statutory language, the Fifth and Eleventh Circuits have retreated from
Taggart
and, instead, adopted the well-established rule that “payment of premiums on behalf of ... employees is ‘substantial evidence that a plan, fund or program (was) established.’ ”
Kidder v. H & B Marine, Inc.,
Madonia’s final contention is that the last prong of the Donovan test — the existence of a plan “participant” — has not been met. ERISA defines “participant” as
any employee or former employee of an employer ... who is or may become eligible to receive a benefit of any type from an employee benefit plan which covers employees of such employer ... or whose beneficiaries may be eligible to receive any such benefit.
*448 29 U.S.C. § 1002(7). Department of Labor regulations further provide that the plan must involve at least one employee other than the corporation’s sole owner to satisfy the “participant” requirement. See 29 C.F.R. §§ 2510.3-3(b) & 2510.3-3(c)(l). Ma-donia claims that MNA’s plan was not an “employee welfare benefit plan” because no MNA employee met the statutory and regulatory definitions of “participant” at the time of removal.
We disagree. It is true that Dr. Madonia cannot be considered a “participant” for purposes of determining the existence of an employee benefit plan. See 29 C.F.R. § 2510.3 — 3(c)(1). However, MNA’s plan ben-efitted employees other than Dr. Madonia. Ms. Martin is the most obvious example. MNA paid two-thirds of her health insurance premiums for three years. Even though she voluntarily terminated her BC/BS coverage in 1991, she remained eligible to renew her insurance coverage by virtue of her employment at MNA. Ms. Anglin is also obviously a “participant” in MNA’s plan. MNA helped her finance health insurance payments through an interest-free loan and a salary raise. The other two employees — Ms. Deal and Ms. Smith — benefited from MNA’s plan as well. They both became eligible for coverage under BC/BS’s “Virginia Physicians and Their Staffs” group plan as a result of MNA’s purchase of a group policy for Dr. Madonia. Each of MNA’s four staff employees “is or may become eligible to receive a benefit of any type from an employee benefit plan.” See 29 U.S.C. § 1002(7). Therefore, they have been and remain “participants” in MNA’s plan.
In enacting ERISA,'Congress designed a comprehensive system of regulating employee benefit plans in order “to provide the maximum degree of protection to working men and women” whose employers provide benefits. S.Rep. No. 127, 93rd Cong., 2d Sess. (1974), reprinted in 1974 U.S.C.C.A.N. 4639, 4838, 4854. In this case, a corporation set about subsidizing and financing the purchase of health insurance for its employees: it invested corporate funds, time, and effort in establishing the program, and it received benefits in the form of tax deductions for those efforts. This certainly is an ERISA employee welfare benefit plan. To say otherwise would deprive MNA employees of the protections ERISA plainly provides, 1 and would thereby place a restrictive gloss on what Congress intended to be a comprehensive statute.
B.
Madonia contends that even if MNA established an ERISA plan, her state claims are not preempted because she does not have standing to sue under ERISA. ERISA confers standing upon “participants” and “beneficiaries” of an ERISA plan. See 29 U.S.C. § 1132(a)(1). In order for Mrs. Madonia to have standing as a “beneficiary,” Dr. Mado-nia must have been a “participant” in MNA’s employee welfare benefit plan. See 29 U.S.C. § 1002(8). ERISA’s definition of “participant” in turn requires that Dr. Mado-nia be an “employee” of MNA. See 29 U.S.C. § 1002(7). Madonia argues that Dr. Madonia is not an “employee” of MNA, and thus could not have been a plan “participant.”
We disagree. Dr. Madonia qualifies as MNA’s “employee” under ERISA’s definition of that term and the Supreme Court’s interpretation of that definition. ERISA defines “employee” as “any individual employed by an employer.” 29 U.S.C. § 1002(6). Dr. Ma-donia plainly falls within this broad definition: he is an “individual,” and he admits that he is “employed by” MNA. This does not end our analysis, however. The Supreme Court recently declared that this statutory definition is “completely circular and explains nothing,” and therefore adopted “a common-law [agency] test for. determining who qualifies as an ‘employee’ under ERISA....”
Nationwide Mutual Ins. Co. v. Darden,
— U.S. -, -,
Madonia challenges this conclusion on the ground that Dr. Madonia’s status as MNA’s sole shareholder bars him from being MNA’s “employee.” Her challenge is twofold. First, she relies on
Kwatcher v. Massachusetts Serv. Employees Pension Fund,
Second, Madonia points to a DOL regulation dealing with the existence of an “employee benefit plan,” which provides:
For purposes of this section: (1) An individual and his or her spouse shall not be deemed to be employees with respect to a trade or business, whether incorporated or unincorporated, which is wholly owned by the individual or by the individual and his or her spouse....
29 C.F.R. § 2510.3-3(c) (emphasis added). Madonia contends that this regulation governs the definition of “employee” throughout ERISA and thereby precludes Dr. Madonia from being deemed an “employee” or a plan “participant.”
Madonia, however, overlooks the introductory clause of the regulation: “[f]or purposes of this section.” “[T]his section” refers to 29 C.F.R. § 2510.3-3, which deals exclusively with the determination of the existence of an “employee benefit plan.” Therefore, by its very terms, the regulation’s exclusion of sole business owners from the definition of “employee” is “limited to its self-proclaimed purpose of clarifying when a plan is covered by ERISA and does not modify the statutory definition of employee for all purposes.”
Dodd v. John Hancock Mutual Life Ins. Co.,
Our reading of the statute works no inequity. “[W]hen self-employed individuals elect to incorporate and the corporation employs others, there is simply no basis in ERISA for disregarding the corporate form.”
Dodd,
By concluding that sole shareholders can be considered “participants” in their companies’ employee welfare benefit plans, we likewise avoid the situation in which two separate bodies of law would govern a corporation’s employee benefits claims. In this particular case, it would seem anomalous to have Madonia seeking recovery under state law theories and Anglin and Martin suing under ERISA. In enacting ERISA, Congress drafted its “ ‘most sweeping federal preemption statute’ ” in order to achieve uniformity and consistency in the law governing employee benefits.
Holland v. Burlington Indus., Inc., 772,
F.2d 1140, 1146 (4th Cir.1985),
aff'd sub nom. Brooks v. Burlington Indus., Inc.,
III.
MNA established a plan to assist its employees in obtaining and financing health insurance coverage. Dr. Madonia is a “participant” in that plan, and Mrs. Madonia has standing to sue as Dr. Madonia’s plan “beneficiary.” Accordingly, Mrs. Madonia’s state law claims relating to that plan were preempted and governed by ERISA, and removal to federal court was proper. The judgment of the district court is
AFFIRMED.
Notes
. See 29 U.S.C. § 1001(b) ("It is hereby declared to be the policy of [ERISA] to protect ... the interests of participants in employee benefit plans and their beneficiaries, by requiring the disclosure and reporting to participants and beneficiaries of financial and other information with respect thereto, by establishing standards of conduct, responsibility, and obligation for fiduciaries of employee benefit plans, and by providing for appropriate remedies, sanctions, and ready access to the Federal courts.”).
. Madonia points to three other cases for the proposition that sole business owners are "employers" and cannot simultaneously be considered
"employees"-
—Meredith
v. Time Ins. Co.,