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Archived News Release--Caution:
information may be out of date.
For more information call: (202) 219-8921.
The U.S. Department of Labor today extended the comment
period through Dec. 18 for a proposal clarifying when an employee benefit plan
is a collectively bargained arrangement exempt from state regulation.
The proposed rule is intended to help alleviate an ongoing
problem created by operators of certain health plans wrongly claiming to be
exempt from state regulation. By claiming to be exempt, operators avoid having
to comply with state laws requiring adequate funding and other safeguards. As a
result, these plans have run out of money and workers have been burdened with
unpaid claims for health care expenses they believed were insured.
The Employee Retirement Income Security Act (ERISA)
exempts from state regulation certain welfare plans when they are established
and maintained under collective bargaining agreements. Congress amended ERISA
in 1983 to make clear that certain plans constitute multiple employer welfare
arrangements (MEWA's), as defined in the statute, and are subject to state
insurance regulation. The 1983 amendments also provided an exception from state
regulation for collectively bargained plans.
The department's proposal clarifies the scope of the
exception from the MEWA definition for plans maintained under collective
bargaining agreements. The proposed rule provides criteria that will
distinguish ERISA-covered health benefit arrangements maintained by legitimate
unions under bona fide collective bargaining agreements from health insurance
arrangements that are subject to state insurance regulation.
Written comments from the public should be submitted prior
to Dec. 18 to the PWBA, U.S. Department of Labor, 200 Constitution Ave., N.W.,
Room N-5669, Washington D.C. 20210, Attention: Proposed Regulation Under
Section 3(40).
The notice is scheduled to be published in the Federal
Register today.
Archived News Release--Caution:
information may be out of date.
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