Is your organization part of a Multiple Employer Welfare Arragement (MEWA)? If so, take notice: the Employee Benefits Security Administration has released final rules under the Affordable Care Act (ACA) to protect workers and employers whose health benefits are provided through a MEWA.
Phyllis C. Borzi, Assistant Secretary of Labor for Employee Benefits Security states, “A MEWA can be a means to offer benefits to workers where none other exists. But too often the individuals operating such arrangements take advantage of employers who want to make health insurance available to workers. Today’s final rules give the department more tools to protect the employees of small companies that band together to purchase benefits.”
The final rules includes the following changes:
- Changes to the Form 5500 Annual Report/Return
- A revised Form M-1
- Authority of the secretary of labor to issue cease and desist orders if it is apparent fraud is occurring within a MEWA
- Authority of the secretary of labor to seize assets of a MEWA if there is probable cause to believe the plan is in a financially hazardous condition
- Requirement to register with the Department of Labor before operating in a state
- A new, all electronic filing system that will double as a searchable registry of MEWAs
In addition to numerous federal requirements, MEWAs may also be regulated on a state level. In North Carolina, MEWAs must be licensed by the North Carolina Department of Insurance. Click here for information from the North Carolina Department of Insurance on the licensing of MEWAs. As regulation and scrutiny from the Agencies icreases, groups of related corporate entities who are providing benefits through a single benefit plan should conduct an analysis to determine if the group of entities qualifies as a controlled group or if the group is operating as a MEWA. For more information on these final regulations, see the Department of Labor’s News Release and Fact Sheet.
