issued two sets of regulations that implement changes made by the
Patient Protection and Affordable Care Act ("PPACA") to the
reporting and enforcement rules applicable to multiple employer
welfare arrangements ("MEWAs").
In very general terms, a
MEWA is any arrangement that is established or maintained to provide
health or welfare benefits to the employees of two or more
employers. However, MEWAs do not include any plan or
arrangement that is established or maintained under a collective
bargaining agreement or any plan that covers a group of employers
under "common control".
Reporting Changes. Most MEWAs must file Form M-1 with DOL
annually to demonstrate compliance with certain group health plan
requirements under ERISA. The new regulations implement PPACA's
additional reporting requirements, which include information about
custodial arrangements, finances, assets and fiduciaries, as well as
the identification of certain other persons who are involved in the
MEWA's operations and administration. The regulations eliminate
the paper filing option and require that all Forms M-1 be filed
electronically, using DOL's on-line filing system.
Also, MEWAs must make
additional Form M-1 filings with DOL within 30 days after the
occurrence of certain events, including the commencement of
operations in new states and when the MEWA experiences a
"material change" in custodial or financial information
that has previously been reported on Form M-1.
Because of the new filing
requirements, the filing deadline for the 2012 Form M-1 has been
extended from March 1, 2013 to May 1, 2013. Upon request, a
further extension may be granted until July 1, 2013.
Enforcement Rules. PPACA provides DOL with the authority to
issue cease-and-desist orders against abusive MEWAs, and to seize the
assets of financially unstable MEWAs. The regulations specify
the criteria required for DOL to exercise these new powers.
DOL may issue
cease-and-desist orders, without prior notice or hearing, when it
reasonably believes a MEWA has engaged in fraud, created an immediate
danger to the public, or may cause significant, imminent and
irreparable injury to the public.
DOL may summarily seize a
MEWA's assets if the MEWA appears to be in financial jeopardy.
The regulations provide that, normally, DOL must obtain court
authorization before seizing a MEWA's assets. However, DOL may
make a seizure without prior court authorization if it believes that
a delay would result in the further loss of plan assets or
destruction of plan records. DOL may also request that a court
appoint a receiver or independent fiduciary for the