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MEWAs - A New Look at Old Problems

ABA JOINT COMMITTEE ON EMPLOYEE BENEFITS  • DATE: February 28, 2012
SPONSORS: The Sections of Business Law; Health Law; Labor and Employment Law; Real Property, Trust and Estate Law; Taxation; Tort Trial and Insurance Practice; and the American College of Employee Benefits Counsel

Program Information

Untitled Document

A 90-minute TeleConference
TUESDAY, FEBRUARY 28, 2012

1:00-2:30 pm ET / 12:00-1:30 pm CT / 11:00 am-12:30 pm MT / 10:00 am-11:30 am PT

Moderator:
Sally Doubet King
, McGuireWoods LLP, Chicago, IL

Speakers:
Ashley Gillihan
, Alston & Bird LLP, Atlanta, GA
Paul T. Harger, Supervisory Investigator, U.S. Department of Labor, Employee Benefits Security Administration , Dallas, TX
Kevin Horahan, Senior Employee Benefits Law Specialist, Office of Health Plan Standards and Compliance Assistance, Employee Benefits Security Administration, U.S. Department of Labor, Washington, DC
Joyce A. Mader, O′Donoghue & O′Donoghue LLP, Washington, DC

Although MEWAs properly operated, provide small employers with an affordable alternative to traditional health insurance, certain operators of MEWAs have often taken advantage of gaps in the law to divert MEWA assets and harm both employers and their employees. The Affordable Care Act gave the Department of Labor additional tools to close gaps in the law and protect consumers. The recent DOL Proposed Regulations, issued pursuant to authority granted by the Affordable Care Act, would

  • Require MEWAs to register with the DOL before beginning operations in a state. This will enable the DOL to track MEWAs as they move their operations. Failure to register will be subject to substantial penalties.
  • Allow the Secretary of Labor to issue a Cease and Desist Order if it appears that a MEWA is engaging in fraud or other abuses.
  • Allow the Secretary of Labor to seize the Assets of a MEWA when the plan is in a financially precarious condition to insure the financial protection of the enrollees.

This program will include a review of MEWA basics - including a discussion of what constitutes a MEWA, the advantages and disadvantages of being a MEWA, current MEWA rules and why they have not been effective in stopping abuse and potential contractual and fiduciary obligations of employers participating in MEWAs. The program will also discuss the impact of the new Form 5500 and Form M­1 reporting requirements on Entities Claiming Exception (ECE’s), including legitimate multiemployer plans.

   
MEWAs - A New Look at Old Problems
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