Form 5500 Form 5500 Annual Return/Report of Employee Benefit Plans

Federal Register / Vol. 78, No. 41 / Friday, March 1, 2013 / Rules and Regulations

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deliberations on all issues. Like all
Committee meetings, the July 14, 2011,
meeting was a public meeting and all
entities, both large and small, were able
to express views on this issue.
A proposed rule concerning this
action was published in the Federal
Register on December 12, 2012 (77 FR
73961). Copies of the rule were mailed
or sent via facsimile to all Committee
members and Florida citrus handlers.
Finally, the rule was made available
through the Internet by USDA and the
Office of the Federal Register. A 30-day
comment period ending January 11,
2013, was provided to allow interested
persons to respond to the proposal. No
comments were received.
A small business guide on complying
with fruit, vegetable, and specialty crop
marketing agreements and orders may
be viewed at: www.ams.usda.gov/
MarketingOrdersSmallBusinessGuide.
Any questions about the compliance
guide should be sent to Jeffrey Smutny
at the previously mentioned address in
the FOR FURTHER INFORMATION CONTACT
section.
After consideration of all relevant
matter presented, including the
information and recommendation
submitted by the Committee and other
available information, it is hereby found
that this rule, as hereinafter set forth,
will tend to effectuate the declared
policy of the Act.
It is further found that good cause
exists for not postponing the effective
date of this rule until 30 days after
publication in the Federal Register (5
U.S.C. 553) because Committee
nominations are scheduled to be held in
the spring, and these changes need to be
in effect in advance so that industry
stakeholders are familiar with the new
grower districts, reapportionment, and
qualifications prior to the nomination
process. Further, to be effective for the
next nomination cycle, the order
requires that the redistricting and
reapportionment actions be announced
on or before March 1, 2013. Also, a 30day comment period was provided for
in the proposed rule.
List of Subjects in 7 CFR Part 905
Grapefruit, Oranges, Reporting and
recordkeeping requirements, Tangelos,
Tangerines.
For the reasons set forth in the
preamble, 7 CFR part 905 is amended as
follows:

Authority: 7 U.S.C. 601–674.

Employee Benefits Security
Administration

§ 905.114 Redistricting of citrus districts
and reapportionment of grower members.

29 CFR Part 2520

Pursuant to § 905.14, the citrus
districts and membership allotted each
district shall be as follows:
(a) Citrus District One shall include
the counties of Alachua, Baker,
Bradford, Citrus, Clay, Columbia, Duval,
Flagler, Gilchrist, Hernando,
Hillsborough, Lake, Levy, Marion,
Nassau, Orange, Osceola, Pasco,
Pinellas, Polk, Putnam, Seminole, St.
Johns, Sumter, Suwannee, and Union
and County Commissioner’s Districts
One, Two, and Three of Volusia County,
and that part of the counties of Indian
River and Brevard not included in
Regulation Area II. This district shall
have two grower members and
alternates.
(b) Citrus District Two shall include
the counties of Broward, Charlotte,
Collier, Dade, De Soto, Glades, Hardee,
Hendry, Highlands, Lee, Manatee,
Monroe, Okeechobee, Sarasota, and that
part of the counties of Palm Beach and
Martin not included in Regulation Area
II. This district shall have three grower
members and alternates.
(c) Citrus District Three shall include
the County of St. Lucie and that part of
the counties of Brevard, Indian River,
Martin, and Palm Beach described as
lying within Regulation Area II, and
County Commissioner’s Districts Four
and Five of Volusia County. This
district shall have four grower members
and alternates.
3. In § 905.120, add paragraph (g) to
read as follows:

■

Nomination procedure.

*

*
*
*
*
(g) Up to four grower members may be
growers who are also shippers, or
growers who are also employees of
shippers.
Dated: February 25, 2013.
David R. Shipman,
Administrator, Agricultural Marketing
Service.
[FR Doc. 2013–04787 Filed 2–28–13; 8:45 am]
BILLING CODE 3410–02–P

PART 905—ORANGES, GRAPEFRUIT,
TANGERINES, AND TANGELOS
GROWN IN FLORIDA
1. The authority citation for 7 CFR
part 905 continues to read as follows:

■

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DEPARTMENT OF LABOR

2. Section 905.114 is revised to read
as follows:

■

§ 905.120

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RIN 1210–AB51

Filings Required of Multiple Employer
Welfare Arrangements and Certain
Other Related Entities
Employee Benefits Security
Administration, Department of Labor.
ACTION: Final rules.
AGENCY:

This document contains final
rules under Title I of the Employee
Retirement Income Security Act (ERISA)
that implement reporting requirements
for multiple employer welfare
arrangements (MEWAs) and certain
other entities that offer or provide
benefits that consist of medical care
(within the meaning of section 733(a)(2)
of ERISA and 29 CFR 2590.701–2) for
employees of two or more employers.
These final rules amend the existing
Form M–1 reporting rules by
incorporating new provisions enacted as
part of the Patient Protection and
Affordable Care Act (the ‘‘Affordable
Care Act’’). They also amend existing
Form 5500 annual reporting rules for
ERISA-covered plans subject to Form
M–1 reporting rules. Elsewhere in this
edition of the Federal Register, the
Employee Benefits Security
Administration is publishing final rules
related to the Secretary of Labor’s new
enforcement authority with respect to
MEWAs, a notice adopting final
revisions to the Form 5500 Annual
Return/Report and its instructions to
add new Form M–1 compliance
questions, as well as an additional
notice announcing the finalized
revisions to the Form M–1 and its
instructions. These improvements in
reporting, together with stronger
enforcement tools authorized by the
Affordable Care Act, are designed to
reduce MEWA fraud and abuse,
protecting consumers from unpaid
medical bills.
DATES: Effective date. These final rules
are effective on April 1, 2013.
Applicability dates: These final rules
pertaining to Form M–1 filings generally
apply for all filing events beginning on
or after July 1, 2013, except that in the
case of the 2012 Form M–1 annual
report, the deadline is now May 1, 2013
with an extension until July 1, 2013
available. The rules pertaining to Form
5500 annual reporting will be applicable
for all Form 5500 Annual Return/Report
filings beginning with the 2013 Form
5500.
SUMMARY:

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Federal Register / Vol. 78, No. 41 / Friday, March 1, 2013 / Rules and Regulations

FOR FURTHER INFORMATION CONTACT:

Allison Goodman or Suzanne Bach,
Employee Benefits Security
Administration, Department of Labor, at
(202) 693–8335. This is not a toll-free
number.
SUPPLEMENTARY INFORMATION:
Customer Service Information:
Individuals interested in obtaining
information from the Department of
Labor concerning employment-based
health coverage laws may call the EBSA
Toll-Free Hotline at 1–866–444–EBSA
(3272) or visit the Department of Labor’s
Web site (http://www.dol.gov/ebsa).
Information on health reform can be
found at http://www.healthcare.gov.
I. Executive Summary
A. Purpose of the Regulatory Action

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1. Need for Regulatory Action
ERISA section 101(g), 29 U.S.C.
1021(g), as amended by the Affordable
Care Act, directs the Department of
Labor (the Department) to promulgate
rules requiring MEWAs that are not
group health plans (non-plan MEWAs)
to register with the Secretary of Labor
(the Secretary) prior to operating in a
State. The statute also allows the
Department to promulgate rules
requiring non-plan MEWAs to report
annually for the purpose of determining
the extent to which the requirements of
ERISA part 7 are being carried out in
connection with such benefits. While
the statutory authority is directed at
non-plan MEWAs, the Department
asserts its authority under ERISA
sections 505, 29 U.S.C. 1135, 104, 29
U.S.C. 1024(b), and 734, 29 U.S.C.
1191c, consistent with the MEWA
annual reporting rule promulgated in
2003 (the 2003 rule or 2003 regulation),
to apply these filing requirements to
MEWAs which are group health plans
(plan MEWAs) as well.
The Form M–1 and the MEWA
reporting requirements were originally
developed under the 2003 rule and used
as a mechanism to help States identify
MEWAs in order to combat a history of
MEWA fraud and abuse. Despite these
reporting rules, MEWA abuses persist
and often lead to insolvency.1 As a
result, affected employees and their
dependents become financially
responsible for medical claims even
though they previously paid premiums
to MEWAs for their medical coverage.2
1 See, e.g., Chao v. Graf, 2002 WL 1611122 (D.
Nev. 2002), In re Raymond Palombo, et al., 2011
WL 1871438 (Bankr. C.D. CA 2011) and Solis v.
Palombo, No. 1:08–CV–2017 (N.D. Ga 2009); Chao
v. Crouse, 346 F.Supp.2d 975 (S.D. Ind. 2004).
2 See Kofman, Mila, Bangit, Eliza, and Lucia,
Kevin, MEWAs: The Threat of Plan Insolvency and
Other Challenges (The Commonwealth Fund March

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These regulations amend the 2003 rule
and establish new registration and
reporting requirements under the
amended section 101(g) of ERISA.
Specifically, these final rules establish
filing requirements and deadlines that
apply to MEWAs annually and upon
specified events.
The statute is detailed but not selfimplementing, contains ambiguities,
and specifically requires the Department
to develop regulations. Therefore, these
consumer protections cannot be
established without these regulations.
2. Legal Authority
The substantive authority for these
regulations is generally ERISA section
101(g), which explicitly requires the
Department to issue regulations
requiring MEWAs to register with the
Secretary prior to operating in a State.
It further provides the Secretary with
authority to issue regulations requiring
MEWAs to report annually on their
compliance with part 7 of ERISA.
Section 505 of ERISA also gives the
Secretary authority to prescribe such
regulations as necessary or appropriate
to carry out the provisions of Title I of
ERISA, which includes the amended
ERISA section 101(g). Further, ERISA
section 734 authorizes the Secretary to
promulgate regulations necessary or
appropriate to carry out the provisions
of ERISA part 7.
In addition, section 104(a)(3)
authorizes the Secretary to exempt any
welfare plan from all or part of the
reporting and disclosure requirements
of Title I or provide for simplified
reporting and disclosure if she finds that
such requirements are inappropriate as
applied to welfare plans.
B. Summary of the Major Provisions of
This Regulatory Action
Paragraph (a) of § 2520.101–2 in these
final rules implements the general
registration and reporting requirements
and explains which entities are required
to file. The regulations explain that
while the language in section 101(g) of
ERISA only applies to non-plan
MEWAs, the regulations preserve the
structure promulgated as part of the
2003 rule, which required both plan
MEWAs and non-plan MEWAs to file
the Form M–1 based on authority found
in sections 505 and 734 of ERISA.
Paragraph (b) defines the terms used
in the final regulations, with some
additions and modifications from the
2004), and Employee Benefits: States Need Labor’s
Help Regulating Multiple Employer Welfare
Arrangements, March 1992, GAO/HRD–92–40
Employee Benefits: States Need Labor’s Help
Regulating Multiple Employer Welfare
Arrangements, March 1992, GAO/HRD–92–40.

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2003 rule. Paragraph (c) sets forth the
requirement that, with certain
exceptions, the administrators of
MEWAs and certain entities that claim
not to be a MEWA solely due to the
exception in section 3(40)(A)(i) of
ERISA (referred to as Entities Claiming
Exception or ECEs) file reports with the
Department.
Paragraph (d) describes how MEWAs
and ECEs will comply with the final
rules by filing the Form M–1, and the
conditions under which the Secretary
may reject a filing.
Paragraphs (e) and (f) set forth the
timeframes when MEWAs and ECEs
must file the Form M–1. Paragraph (g)
directs that the Form M–1 be filed
electronically. The information
provided through Form M–1 filings will
then be accessible by the public and
other interested parties such as State
regulators.
Paragraph (h) explains the civil
penalties that may result from a failure
to comply with these final rules. Civil
penalties for failure to file a report
required by ERISA section 101(g) or
§ 2520.101–2 have been applicable for
non-plan MEWAs under ERISA section
502(c)(5) since May 1, 2000.
These final rules also amend
regulations under ERISA sections 103
and 104 to further enhance the
Department’s ability to enforce
§ 2520.101–2 by making the filing of the
Form M–1 an integral part of
compliance with ERISA’s annual
reporting requirements for plans subject
to the Form M–1 filing requirements
under § 2520.101–2. As a result, failure
to provide information on the Form
5500 about compliance with the
requirement to file a Form M–1 may
result in the rejection of the Form 5500
as incomplete and the assessment of
civil penalties under ERISA section
502(c)(2).
Finally, new criminal penalties were
added by the Affordable Care Act under
ERISA section 519 for any person who
knowingly submits false statements or
false representations of fact in
connection with a MEWA’s financial
condition, the benefits it provides, or its
regulatory status as a MEWA. The
Affordable Care Act also amended
ERISA section 501(b) to impose criminal
penalties on any person who is
convicted of violating the prohibition in
ERISA section 519. The final rules
retain the cross-reference to sections
501(b) and 519 for the purpose of
implementing these new rules as these
provisions relate to filing a Form M–1.
Final rules published elsewhere in
today’s Federal Register provide further
guidance with respect to ex parte cease

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Federal Register / Vol. 78, No. 41 / Friday, March 1, 2013 / Rules and Regulations
and desist and summary seizure orders
for MEWAs.

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C. Costs and Benefits
These final regulations are designed
to impose a minimal amount of burden
on legally compliant MEWAs and ECEs
while implementing the Secretary’s
authority under the Affordable Care Act
to take enforcement action against
fraudulent or abusive MEWAs and
working to protect health benefits for
businesses and their employees. This
rule implements the new provisions
while preserving the filing structure and
provisions of the 2003 rule, which
directed plan MEWAs and non-plan
MEWAs to file the Form M–1.
The additional filing requirements
will enhance the State and Federal
governments’ joint mission to take
enforcement action against fraudulent
and abusive MEWAs, thus limiting the
losses suffered by American workers,
their families, and businesses when
abusive MEWAs become insolvent and
fail to reimburse medical claims.
Under the final regulations, MEWAs
and ECEs will incur costs to fill out and
electronically file the Form M–1 and
Form 5500. The Department estimates
that the annualized cost may be
approximately $0.1 million. As is
common with regulations implementing
new policies, there is considerable
uncertainty arising from general data
limitations and the degree to which
economies of scale exist for disclosing
this information. Nonetheless, the
Department believes that these final
regulations lower overall administrative
costs from the 2003 rule because of the
move to an electronic only filing system.
In accordance with Executive Orders
12866 and 13563, the Department
believes that the benefits of this
regulatory action justify the costs.
II. Background
The term ‘‘multiple employer welfare
arrangement’’ (MEWA) is defined in
section 3(40) of ERISA, 29 U.S.C.
1002(40), in pertinent part, as an
employee welfare benefit plan, or any
other arrangement (other than an
employee welfare benefit plan), which
is established or maintained for the
purpose of offering or providing welfare
benefits to the employees of two or more
employers (including one or more selfemployed individuals), or to their
beneficiaries, except that such term does
not include any such plan or other
arrangement which is established or
maintained under or pursuant to one or
more agreements which the Secretary
finds to be collective bargaining
agreements, by a rural electric
cooperative, or by a rural telephone

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cooperative association. For purposes of
this definition, two or more trades or
businesses, whether or not incorporated,
shall be deemed a single employer if
such trades or businesses are within the
same control group. The term ‘‘control
group’’ means a group of trades or
businesses under common control. The
determination of whether a trade or
business is under ‘‘common control’’
with another trade or business shall be
determined under regulations of the
Secretary applying principles similar to
the principles applied in determining
whether employees of two or more
trades or businesses are treated as
employed by a single employer under
section 4001(b) of ERISA, 29 U.S.C.
1301(b), except that, for purposes of this
paragraph, common control shall not be
based on an interest of less than 25
percent.3
The Health Insurance Portability and
Accountability Act of 1996 (Pub. L.
104–191, 110 Stat. 1936) (1996))
(HIPAA) amended ERISA to provide for,
among other things, improved
portability and continuity of health
insurance coverage. HIPAA also added
section 101(g) to ERISA, providing the
Secretary with the authority to require,
by regulation, annual reporting by nonplan MEWAs. The Secretary exercised
the authority under the HIPAA
provision by creating the Form M–1
under a 2000 interim final rule and 2003
rule.4 Those rules generally required the
administrator of both non-plan and plan
MEWAs and ECEs to file the Form M–
1 annually with the Secretary. The
purpose of this form was to allow the
Department to determine whether the
requirements of part 7 were being met.
Part 7 of ERISA includes statutory
amendments made by HIPAA and other
statutes for which MEWAs must
annually report compliance.
The original MEWA reporting
requirement created under HIPAA was
also enacted in response to a 1992
General Accounting Office (GAO)
3 This provision was added to ERISA by section
302(b) of the Multiple Employer Welfare
Arrangement Act of 1983, Public Law 97–473, 96
Stat. 2611, 2612 which also amended section 514(b)
of ERISA, 29 U.S.C. 1144(a). Section 514(a) of
ERISA provides that State laws that relate to
employee benefit plans are generally preempted by
ERISA. Section 514(b) sets forth several exceptions
to the general rule of section 514(a) and subjects
employee benefit plans that are MEWAs to various
levels of State regulation depending on whether the
MEWA is fully insured. Sec. 302(b), Public Law 97–
473, 96 Stat. 2611, 2613 (29 U.S.C. 1144(b)(6)).
4 65 FR 7152 (02/11/2000) and 68 FR 17494 (04/
09/2003). The Form M–1 is reissued each year in
December by the Department and has been
modified to address changes to the statutory
provisions in part 7 of ERISA.

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13783

report 5 that detailed a history of MEWA
fraud and abuse.6 To combat fraudulent
MEWAs, the GAO recommended that
the Department develop a mechanism to
help States identify MEWAs. Although
the annual MEWA reporting rules
enabled the Department to develop a
registry of MEWAs that filed the Form
M–1, the requirement alone has not
stopped the abuses discussed in the
GAO report. MEWAs are frequently
marketed by unlicensed entities that do
not comply with State insurance
reserve, contribution, and consumer
protection requirements. As a result,
such entities often offer health coverage
at rates substantially lower than
licensed insurers, making them
particularly attractive to some small
employers that find it difficult to obtain
affordable health insurance for their
employees. Unfortunately, due to
insufficient funding and inadequate
reserves, and in some situations,
excessive administrative fees and fraud,
some MEWAs have become insolvent
and unable to pay medical benefit
claims. This results in affected
employees and their dependents
becoming financially responsible for
paying medical claims even after they
paid premiums for their medical
coverage. The unfortunate reality is that
currently, the Department often does not
find out about insolvent or fraudulent
MEWAs until significant harm has
occurred to employers and participants.
Furthermore, while the Department—
often working with State insurance
departments—has had some success
with both civil and criminal cases
against MEWA operators, the monetary
judgments are often uncollectible,
leaving the employers and/or individual
participants without coverage for claims
that can be considerable.7
5 See, Employee Benefits: States Need Labor’s
Help Regulating Multiple Employer Welfare
Arrangements, March 1992, GAO/HRD–92–40.
6 For example, the 1992 GAO report indicated
that between 1988 and 1991, MEWAs left at least
398,000 participants and beneficiaries with over
$123 million in unpaid claims. Meanwhile more
than 600 MEWAs failed to comply with State
insurance laws. See supra note 3.
7 See United States v. Gerald Rising, Jr., plea
agreement, 11–cr–00117–WYD–01 (U.S.D.Ct.CO) (In
2012, the owner of a MEWA that sold stop-loss
insurance pled guilty for understating the claim
amounts that would trigger stop-loss payments in
order to charge excessive fees; the owner also
commingled clients’ premiums, overcharged fees,
and issued fraudulent invoices, to a cost of over
$3.6 million to his victims, which included over
250 individuals, businesses and government
agencies.) See also United States v. Edwards, plea
agreement, 1:05CR 265 (M.D.N.C. 2006) (In 2005, a
MEWA operator, whom the Department showed
collected over 36 million dollars in healthcare
insurance premiums and failed to obtain health
insurance coverage for its employer clients which
resulted in thousands of uncovered employees and

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The Patient Protection and Affordable
Care Act (Pub. L. 111–148, 124 Stat.
119) and the Health Care and Education
Reconciliation Act of 2010 (Pub. L.111–
152, 124 Stat. 1029) (these are
collectively known as the ‘‘Affordable
Care Act’’), have established a
multipronged approach to MEWA
abuses. The principal provisions
include sections 6601, 6605, and 6606
of the Affordable Care Act. Section 6601
prohibits false statements and
representations in connection with the
marketing or sale of a MEWA. Section
6605 enables the Secretary to issue
administrative cease and desist orders
when MEWAs engage in certain conduct
and summary seizure orders against
MEWAs in a financially hazardous
condition. In addition, section 6606
amended section 101(g) of ERISA.
Under this last amendment, MEWAs
providing benefits consisting of medical
care (within the meaning of section
733(a)(2) of ERISA, 29 U.S.C.
1191b(a)(2)), which are not group health
plans must now register with the
Secretary prior to operating in a State.
Congress left untouched the Secretary’s
authority to issue regulations directing
such MEWAs to report, not more
frequently than annually, in such form
and such manner as the Secretary
specifies for the purpose of determining
the extent to which the requirements of
part 7 of ERISA are being met. These
final regulations implement the ERISA
section 101(g) MEWA annual reporting
provision by directing all MEWAs,
including those that are plan MEWAs,
to report compliance with the part 7
rules, including the Public Health
Service Act (PHS Act) market reforms
(PHS Act sections 2701 through 2728)
incorporated by reference in ERISA
section 715 by the Affordable Care Act.
These final regulations also require
MEWAs to register with the Department
before operating in a State. The
additional information provided on the
Form M–1 as a result of these final rules
will enhance the State and Federal
governments’ joint mission to prevent
approximately $8 million in unpaid claims), and
Solis v. W.I.N. Ass’n, L.L.C., et. al., slip op. 4:11cv-00616 (S.D. Tex. 2011) (The Department
investigated a MEWA which failed to make
payments on health care claims, charged excessive
fees, engaged in self-dealing, and failed to disclose
fees to the client employers in the plan. The
Department obtained a Consent Judgment and
Order against the MEWA operators for leaving
hundreds of participants without coverage and
permanently enjoining them from acting as
fiduciaries in the future. Also, the court authorized
the Secretary to bring a collection action for the
plan losses against one of the MEWA operators
relative to his ability to restore those plan losses.)
For additional information about MEWAs, see
http://www.dol.gov/ebsa/newsroom/
fsMEWAenforcement.html.

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harm and take enforcement action
against fraudulent and abusive MEWAs,
thus limiting the losses suffered by
American workers, their families, and
businesses when abusive MEWAs
become insolvent and fail to reimburse
medical claims. These final rules
implement the statutory requirements in
a way that limits the burden on
legitimate MEWAs but gives the
Secretary, States, employers, and the
participants and beneficiaries of the
plans additional information about
these entities and a stronger
enforcement scheme.
On December 6, 2011, the Department
published in the Federal Register
proposed regulations (76 FR 76222)
implementing the new reporting
requirements for MEWAs and ECEs. The
Department received six comments on
the proposed rules. After consideration
of the comments received, the
Department is publishing these final
regulations. While these final rules
reflect a few changes and add some
clarifications in response to questions
posed by commenters, they do not
significantly modify the requirements
set forth in the proposed rules.
III. Overview of the Final Regulations
A. Amendment of 29 CFR 2520.101–2
Under ERISA Section 101(g).
To implement the changes made to
ERISA section 101(g) by the Affordable
Care Act, these final rules amend the
2003 rule. In the 2003 rule, ECEs and
MEWAs were largely subject to the same
filing requirements. ECEs, however,
were only required to submit an annual
M–1 filing for the first three years
following an origination event. In
keeping with this structure, these final
rules extend the new filing events
prescribed by the Affordable Care Act to
MEWAs and ECEs alike. They also
preserve the three-year limitation
included in the 2003 regulation for
ECEs. Based on comments on the
proposed rules from the multiemployer
plan community, the final rules limit
the events that will constitute an
origination to those defined as such in
the 2003 rule.
Paragraph (a) of § 2520.101–2 in these
final regulations describes the
provisions of section 101(g) of ERISA
that direct MEWAs that provide benefits
consisting of medical care (within the
meaning of section 733(a)(2) of ERISA)
to register with the Secretary prior to
operating in a State, and to report
annually regarding compliance with
part 7 of ERISA.
Paragraph (b) defines the terms used
in the final regulations, with some
additions and modifications from the

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2003 rule. Paragraph (c) sets forth the
requirement that, with certain
exceptions, the administrators of
MEWAs or ECEs file reports with the
Department.
Paragraph (d) describes how MEWAs
and ECEs will comply with the final
rules by filing the Form M–1, and the
conditions under which the Secretary
may reject a filing.
Paragraphs (e) and (f) set forth the
timeframes when MEWAs and ECEs
must file the Form M–1. Paragraph (g)
directs that the Form M–1 be filed
electronically. In addition to
minimizing errors and providing faster
access to reported data, electronic filing
will also be less burdensome on the
filer. Once information about the
MEWA or ECE is entered into the
system, filers will have the option of
allowing the system to copy information
provided on a past filing into a new
filing. This transfer of past information
provides filers an easy way to update or
verify information. The information
provided through Form M–1 filings will
then be accessible by the public and
other interested parties such as State
regulators.
Paragraph (h) explains the civil
penalties that may result from a failure
to comply with the rule. Civil penalties
for failure to file a report required by
ERISA section 101(g) or § 2520.101–2
have been applicable for non-plan
MEWAs under ERISA section 502(c)(5)
since May 1, 2000.8
Finally, new criminal penalties were
added by the Affordable Care Act under
ERISA section 519 for any person who
knowingly submits false statements or
false representations of fact in filing
reports required under the rule.
1. Basis and Scope
These final regulations set forth rules
implementing section 101(g) of ERISA,
as amended by section 6606 of the
Affordable Care Act, which directs
MEWAs that are not group health plans
to register with the Secretary prior to
operating in a State. These regulations
also update the existing requirement in
section 101(g) of ERISA, that MEWAs,
which are group health plans, and
certain other entities claiming an
exception, file the Form M–1 annually
and upon the occurrence of specified
events. While the language in section
8 Under these final regulations, similar civil
penalties under ERISA section 502(c)(2) may apply
to plan MEWAs and ECEs required to file the Form
M–1 that fail to answer questions on the Form 5500
about compliance with the requirement to file a
Form M–1. See section B of this preamble for the
changes that are being made to §§ 2520.103–1, 104–
20, and 104–41 to further enhance the Department’s
ability to enforce these provisions with regard to
MEWAs and ECEs that are group health plans.

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101(g) of ERISA only applies to nonplan MEWAs, these final rules preserve
the structure promulgated as part of the
2003 regulation, which required both
plan and non-plan MEWAs to file the
Form M–1, based on authority found in
sections 505 and 734 of ERISA. Section
505 of ERISA states that the Secretary
may prescribe such regulations as she
finds necessary or appropriate to carry
out the provisions of Title I of ERISA.
Section 734 of ERISA allows the
Secretary to promulgate such
regulations as may be necessary or
appropriate to carry out the provisions
of part 7 of ERISA.
One commenter questioned the
Department’s authority to require ECEs
to file a Form M–1 prior to operating in
a State. As explained in the preamble to
the 2003 rule, the Department has set
forth procedures for administrative
hearings to obtain a determination by
the Secretary that a collectively
bargained plan is exempted from
ERISA’s definition of a MEWA. 29 CFR
2510.3–40. An entity that has a
determination from an Administrative
Law Judge (ALJ) that it is such a
collectively-bargained plan is not
required to file a Form M–1 while the
opinion remains in effect unless the
circumstances underlying the
determination change. Entities may,
however, claim the exemption on their
own accord and sometimes do so
incorrectly, including as part of an
insurance fraud scheme using sham
unions and collective bargaining
agreements to market health coverage to
small employers. The Secretary remains
concerned about MEWA operators who
avoid State insurance regulation by
making false assertions that the
arrangement is pursuant to a collective
bargaining agreement. The requirement
that ECEs file the Form M–1 for only
three years after an origination event
continues to provide an important
enforcement tool while imposing little
burden on bona fide collectively
bargained plans. Bona fide collectively
bargained plans also benefit from the
early identification of MEWA operators
using sham unions and collective
bargaining agreements. Consequently,
based on the Department’s authority
under ERISA sections 505 and 734, the
final rules preserve the three-year
limitation included in the 2003
regulation for ECEs.
2. Definitions
a. Operating. Paragraph (b)(8) of
§ 2520.101–2 of the proposed and these
final rules adds a definition of
‘‘operating’’ and defines it as any
activity including but not limited to
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offering to provide benefits consisting of
medical care. This definition, which
includes marketing and administrative
activities, governs when Form M–1
filings must be made. Some commenters
raised concerns that the definition in
the proposed rules could be interpreted
broadly to include participants
receiving medical care in a State in
which the MEWA or ECE has not been
providing medical benefits and for
which it is not otherwise required to
make any filings. These commenters
noted that MEWAs or ECEs would be
unable to comply with the requirement
to file the Form M–1 30 days before
operating in an additional State because
they would not know when a
participant planned, for instance, to
move or travel to a new State. The
Department never intended for the
definition of operating to apply to the
receipt of medical care without any
action by, or on behalf of, the MEWA or
ECE to market, solicit, provide, or offer
to provide medical benefits to a
participating employer in that State.
Commenters also noted that, in
general, they would not be aware in
advance if an employer or union, on its
own accord, distributes information
about medical care in a State in which
the MEWA or ECE has not been
operating and is not registered. ECEs, in
particular, may not be aware of a
contract awarded for work in a new
State to a company that is part of a
collective bargaining agreement. The
Department agrees that there are
circumstances in which it would be
difficult, if not impossible, for a MEWA
or ECE to file the Form M–1 30 days
before operating in an additional State.
Consequently, while the Department has
not revised the definition of operating,
as discussed later in this preamble,
provisions in paragraph (e) in these final
rules on when a MEWA or ECE must file
when it begins operating in an
additional State have been revised to
address this concern.
b. Origination and Special Filing
Events. The 2003 rule used the term
‘‘origination’’ to determine if additional
filings were necessary for both MEWAs
and ECEs. As in the proposed rules, the
Department only uses the term
‘‘origination’’ when it refers to events
that trigger an additional filing by ECEs
in the final rules. The term
‘‘registration’’ also continues to be used
to refer to filings by MEWAs.
The definition of origination,
however, has been modified in the final
rules. This change responds to a
commenter who found the provisions in
the proposed rules relating to the
application of the three-year limitation
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additional States to be confusing. These
final rules have been adjusted to clarify
that an ECE is not required to file a
Form M–1 solely because it begins
operating in an additional State or
experiences a material change after the
three-year period following any of the
three origination events: (i) The ECE
first begins operating with regard to the
employees of two or more employers
(including one or more self-employed
individuals); (ii) the ECE begins
operating following a merger with
another ECE (unless all of the ECEs that
participate in the merger previously
were last originated at least three years
prior to the merger); or (iii) the number
of employees receiving coverage for
medical care under the ECE is at least
50 percent greater than the number of
such employees on the last day of the
previous calendar year (unless the
increase is due to a merger with another
ECE under which all ECEs that
participate in the merger were last
originated at least three years prior to
the merger).
In paragraph (b)(9)(ii) and (v) of
§ 2520.101–2 of the proposed rules, the
definition of origination also included
an ECE that begins operating in an
additional State or experiences a
material change. To clarify that the
three-year rule does not restart or extend
when those two events occur, they were
moved to a new paragraph (b)(11) in the
final rules on special filing events.
Additionally, the reference to the threeyear period during which filings are
required was removed from the
definition of origination. In the final
rules, the paragraph (b)(9) origination
events and the corresponding filing
rules in paragraph (c)(1)(ii) now clarify
that only the events in paragraph (b)(9)
restart or extend the three-year period
for ECEs.
c. Reporting. As in the proposed rules,
the final rules add a definition of
‘‘reporting.’’ ‘‘Reporting’’ or ‘‘to report’’
means to file the Form M–1 as required
pursuant to section 101(g) of ERISA;
§ 2520.101–2; or the instructions to the
Form M–1. The term ‘‘reporting’’ is used
in order to correspond to the
terminology of § 2560.502c–5, which
uses the generic term ‘‘report’’ to
describe the Form M–1 filing process,
including the annual report as well as
registration, origination, and all other
required M–1 filings.
d. State. The final rules also, like the
proposed rules, add a definition of
‘‘State’’ and define the term by reference
to § 2590.701–2. This definition was
added because MEWAs must register,
and ECEs must make an origination
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3. Persons Required to Report
Paragraph (c) of § 2520.101–2 of the
final rules set forth the persons required
to report. As under the 2003 rule and
the proposed rules, the final rules direct
the administrator of a MEWA that
provides benefits consisting of medical
care, whether or not the MEWA is a
group health plan, to file the Form M–
1. It also requires filing by the
administrator of an ECE that offers or
provides coverage consisting of medical
care. Several commenters suggested
changes to this section. One commenter
sought to have third party
administrators carved out of the
definition of administrator. Another
sought to have affiliated service groups
exempted from the filing requirements.
The Department considered these
comments but declines to modify these
longstanding provisions promulgated as
part of the 2003 rule. However, as noted
above, to clarify the timing requirements
for filings required of ECEs, this
paragraph references the requirement
that such filings be made only during
the three years after the ECE is
originated.
4. Information To Be Reported
Paragraph (d) of the final rules is
unchanged from the proposed rules. It
clarifies that the reporting requirements
of § 2520.101–2 will only be satisfied by
filing a completed copy of the Form M–
1, including any additional statements
required pursuant to the Form M–1
instructions. One commenter wanted
even more detailed financial
information collected on the Form M–1.
As noted earlier, after consideration of
the comments made, the Department
has reviewed the Form M–1 but made
only minor changes to the content of the
Form M–1 that was proposed to
correspond to these final rules. A notice
announcing the availability of the
finalized revisions to the Form M–1 and
its instructions are published elsewhere
in this edition of the Federal Register.

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5. Reporting Requirements and Timing
The final rules retain from the 2003
rule and the proposed rules that both
MEWAs and ECEs must file the Form
M–1 annually, with ECEs only having to
file annually for the first three years
following an origination. However, to
clarify the application of the new
registration requirements, the annual
filing requirements were moved from
paragraph (e) to paragraph (f) (and
paragraphs (f) and (g) were redesignated
paragraphs (g) and (h)).
As mentioned previously, MEWAs
and ECEs are also subject to additional
(non-annual) filings in certain

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circumstances. Several non-annual
filing events were included in the 2003
regulation, but, as previously explained,
these filings were relabeled and
expanded in the proposed rules and
these final rules to implement changes
to the statutory language. The 2003
regulation and the proposed rules
generally required an additional filing
when a MEWA or ECE: (1) First began
offering or providing coverage for
medical care to employees of two or
more employers; (2) began offering or
providing coverage for medical care to
employees of two or more employers
after a merger with another MEWA or
ECE; or (3) increased the number of
employees receiving medical care under
the MEWA or ECE by at least 50 percent
over the number of employees on the
last day of the previous calendar year.
In the proposed rules, the first event
was modified to conform to the
statutory language under ERISA section
101(g) directing MEWAs to register with
the Secretary by filing a Form M–1 prior
to operating in any State. Additionally,
the proposed rules directed that a filing
be made in the event a MEWA (and in
some cases an ECE) expands its
operations into additional States or
experiences a material change as
defined in the Form M–1 instructions.
These filing events are preserved in
these final rules.
Several commenters sought to limit
filings due to a material change. This
filing event was added to direct an
entity to update its Form M–1 filing in
the event that it experienced changes in
certain financial or custodial
information. The Department intends to
follow the same basic structure for these
filings as it has indicated it will for
filings related to operating in a State. So,
for example, if a MEWA or ECE takes
action to add or remove an individual
who is a marketer or promoter, the
MEWA or ECE would have experienced
a material change and would need to
report. However, if the MEWA or ECE
employs a third party (and
appropriately identifies that entity in its
filings) and the third party takes action
to add or remove an individual who is
a marketer or promoter, the MEWA or
ECE will not have experienced a
material change and no additional filing
will be required. In the event an entity
experiences a material change, the
online filing system will allow them to
log on, import data from the most
recently completed filing, and make the
necessary changes. The regulatory
provision is retained as proposed, but in
response to these comments, the
Department will continue to ensure the
electronic filing system minimizes the

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additional burden on entities that
experience a material change.
Consistent with the 2003 rule and the
proposed rules, these final rules direct
MEWAs to submit filings for the
duration of their existence and ECEs to
file only during the three-year period
following an origination. As noted
above, ECEs that begin operating in a
new State or experience a material
change during their three-year filing
period report those events. ECEs that are
not required to file because they are
outside their three-year period do not
need to report those events.
The final rules also apply new timing
standards on MEWAs and ECEs for
these additional filings. Under the 2003
regulation, MEWAs and ECEs filed the
Form M–1 within 90 days of the
occurrence of certain events. The
proposed and these final rules direct
entities to file 30 days prior to or within
30 days of the event, depending on the
type of event which prompts the filing.
The timing requirements in paragraph
(e) implement section 6606 of the
Affordable Care Act, which provides
that the filing must happen ‘‘prior to
operating in a State’’ and will also
facilitate the Department’s timely
receipt of information related to the
other filing events described above. One
commenter suggested that ECEs not be
required to file 30 days prior to
operating in an additional State because
it might be difficult for the entity to
determine when the event occurs. The
Department considered this comment
and, as previously stated, has revised
the provision to address this concern. In
these final rules, a MEWA or ECE will
need to make a registration or special
filing within 30 days of knowingly
operating in any additional State or
States. The Department does, however,
expect MEWAs and ECEs to periodically
monitor the activities of participating
employers so that they become aware of
any unilateral actions by participating
employers that have caused them to
begin operating in an additional State.
Knowledge by a MEWA or ECE includes
knowledge by an employee or agent of
the MEWA or ECE.
The provision included in the
proposed rules to discourage ‘‘blanket
filings,’’ (i.e., registration, origination, or
special filings that cover multiple
States, unless the filer expects to begin
operating in all the named States in the
near future), was retained in these final
rules. Blanket filings that list States
where the filer has no immediate intent
to operate could frustrate the law’s goal
of gathering and maintaining timely and
accurate information on MEWAs. Under
this provision, a filing is considered
lapsed with respect to a State if benefits

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consisting of medical care are not
offered or provided in the State during
the calendar year immediately following
the filing. A new filing would be
required if the filer intends to resume
operating in that State.
To minimize the burden of
compliance, the final rules continue to
permit MEWAs and ECEs to make a
single filing to satisfy multiple filing
events so long as the filing is timely for
each event.
As in the 2003 rule and the proposed
rules, filing extensions are available.
Any filing deadline that is a Saturday,
Sunday, or federal holiday is
automatically extended to the next
business day. The proposed rules
provided a more substantial extension
for annual filings if MEWAs and ECEs
requested such an extension following
the procedure outlined in the
instructions to the Form M–1. A
question was raised regarding whether
extensions were limited to annual
filings. The Department considered this
option and believes that any filing
should be eligible for an extension so
long as the request is made in a timely
manner and in accordance with the
Form M–1 instructions. A modification
to this effect was made to the operative
language in paragraph (e) of § 2520.101–
2 of the final rules.
6. Electronic Filing
As in the proposed rules, paragraph
(g) of § 2520.101–2 of the final rules
eliminates the option to file a paper
copy of the completed Form M–1. As is
now the case for Form 5500 Annual
Return/Report filings required under
Title I of ERISA and consistent with the
goals of E-government, as recognized by
the Government Paperwork Elimination
Act 9 and the E-Government Act of
2002,10 these final rules require that the
Form M–1 be filed electronically.
Electronic filing of benefit plan
information, among other program
strategies, facilitates EBSA’s
achievement of its Strategic Goal to
‘‘assure the security of the retirement,
health and other workplace related
benefits of American workers and their
families.’’ EBSA’s strategic goal directly
supports the Secretary of Labor’s
Strategic Goal to ‘‘secure health
benefits.’’ 11 A cornerstone of the
Department’s enforcement program is
the collection, analysis, and disclosure
of benefit plan information. Electronic
9 Title

XVII, Public Law 105–277, 112 Stat. 2681
(Oct. 21, 1998).
10 Public Law 107–347, 116 Stat. 2899 (Dec. 17,
2002).
11 For further information on the Department of
Labor’s Strategic Plan and EBSA’s relationship to it,
see http://www.dol.gov/_sec/stratplan/.

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filing minimizes errors and provides
faster access to reported data, assisting
EBSA in its enforcement, oversight, and
disclosure roles and ultimately
enhancing the security of plan benefits.
Electronic filing of the Form M–1 also
reduces the paperwork burden and costs
related to printing and mailing forms
and, with the use of secure account
access, allows updating of previously
reported information to facilitate
simplified future reporting. Finally,
consistent with current practice, the
information will be available for
reference by participants, beneficiaries,
participating employers, and other
interested parties such as State
regulators. A notice announcing the
availability of the updated Form M–1
filing system will be published
elsewhere in this edition of the Federal
Register.
7. Penalties
a. Civil penalties and procedures. The
final rules retain the references to
section 502(c)(5) of ERISA, 29 U.S.C.
1132(c)(5) and § 2560.502c–5 regarding
civil penalties and procedures.
b. Criminal penalties and procedures.
Affordable Care Act section 6601 added
ERISA section 519, which prohibits a
person from making false statements or
representations of fact in connection
with a MEWA’s financial condition, the
benefits it provides, or its regulatory
status as a MEWA. The Affordable Care
Act also amended ERISA section 501(b)
to impose criminal penalties on any
person who is convicted of violating the
prohibition in ERISA section 519. The
final rules retain the cross-reference to
sections 501(b) and 519 of ERISA, 29
U.S.C. 1131 and 1149, for the purpose
of implementing these new rules as they
relate to filing a Form M–1 prior to
operating in a State or other registration,
origination, and special filings.
c. Cease and desist and summary
seizure and procedures. Section 6605 of
the Affordable Care Act added section
521 to ERISA, which authorizes the
Secretary to issue cease and desist
orders, without prior notice or a
hearing, when it appears to the
Secretary that the alleged conduct of a
MEWA is ‘‘fraudulent, or creates an
immediate danger to the public safety or
welfare, or is causing or can be
reasonably expected to cause
significant, imminent, and irreparable
public injury.’’ This section also allows
the Secretary to issue an order to seize
the assets of a MEWA that the Secretary
determines to be in a financially
hazardous condition. The regulation
providing guidance on the cease and
desist orders and summary seizure rules
published elsewhere in this Federal

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Register also includes regulatory
guidance on the procedural rules for
this process. A cease and desist order
containing a prohibition against
transacting business with any MEWA or
plan would prevent the MEWA or a
person from avoiding the cease and
desist order by shutting the MEWA
down and re-establishing it in a new
location or under a new identity.
As such, the final rules retain the
cross-reference to section 521 of ERISA
and § 2560.521 regarding the Secretary’s
authority to issue cease and desist and
summary seizure orders.
B. Amendment to Regulations Under
ERISA Sections 103 and 104
Pursuant to authority in ERISA
section 104(a)(3) to establish reporting
exemptions and simplified reporting for
welfare benefit plans, this rulemaking
also makes filing the Form M–1 an
integral part of compliance with
ERISA’s simplified reporting
requirements by requiring all plans
subject to the Form M–1 filing
requirements under § 2520.101–2 to file
a Form 5500 Annual Return/Report, and
include specific Form M–1 compliance
information. The revisions to the Form
5500 and instructions reflecting these
final rules are being published
simultaneously as a Notice of Adoption
of Revisions to the Form 5500 Annual
Return/Report in today’s Federal
Register. That document includes a
discussion of the changes to the Form
5500 and instructions as well as the
Department’s findings required under
sections 104(a)(3) and 110 of ERISA
with regard to the use of the revised
Form 5500 as a simplified report,
alternative method of compliance, and/
or limited exemption pursuant to
§ 2520.103–1(b).
We requested but received no
comments on these changes to the
annual reporting requirements;
therefore, these final rules retain the
changes proposed to further enhance the
Department’s ability to enforce the Form
M–1 filing requirements under
§ 2520.101–2, except for technical
changes and a clarification that all plans
required to file the Form M–1 (plan
MEWAs and ECEs) are required to file
a Form 5500 and to answer the Form M–
1 compliance questions on the Form
5500.12
12 Unlike plan MEWAs that are under a
permanent requirement to file the Form M–1, 29
CFR 2520.101–2 requires an ECE to file the Form
M–1 only during the three years following each
origination event (an ECE may experience more
than one origination event). Therefore, the final
Form 5500 rules for plans required to file the Form
M–1 apply to ECEs only during the periods in
which ECEs are required to file the Form M–1.

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The primary change to § 2520.103–1
being adopted in this rule is the
addition of a new paragraph (f)
regarding the content of the annual
report. Existing paragraph (f) of
§ 2520.103–1 is redesignated paragraph
(g), but is otherwise unchanged. New
§ 2520.103–1(f) applies to all plans that
are subject to the Form M–1 filing
requirements of § 2520.101–2 during the
plan year. This change provides that all
such plans must demonstrate
compliance with § 2520.101–2 (filing
the Form M–1) in order to satisfy the
annual reporting requirements of
§ 2520.103–1. Pursuant to ERISA section
502(c)(2), 29 U.S.C. 1132(c)(2), a plan
administrator who fails to file a Form
5500 Annual Return/Report with a proof
of compliance with § 2520.101–2 may
be subject to a civil penalty of up to
$1,100 a day (or higher amount if
adjusted pursuant to the Federal Civil
Penalties Inflation Adjustment Act of
1990, as amended) for each day a plan
administrator fails or refuses to file a
complete report. Although ERISA
sections 505 and 734 give the Secretary
the authority to require MEWAs and
ECEs that are employee benefit plans to
comply with the requirements of
§ 2520.101–2, unlike MEWAs that are
not employee benefit plans, there is no
specific ERISA civil penalty applicable
to plan MEWAs and ECEs for a failure
to comply with those requirements.
These changes to the Form 5500 annual
reporting requirements for plan MEWAs
and ECEs will enhance the Department’s
ability to enforce the Form M–1 filing
requirements.
The final rules include conforming
changes adding references to the new
§ 2520.103–1(f) and other conforming
changes in §§ 2520.103–1(a), (b), (c) and
§ 2520.104–41. A corresponding change
is also made to § 2520.104–20 to
expressly provide that the limited filing
exemption under § 2520.104–20 is no
longer available to plan MEWAs and
ECEs with fewer than 100 participants
required to file the Form M–1 (small
plans). In addition, a new paragraph (E)
has been added to § 2520.103–1(c)(2)(ii)
to provide that small plans subject to
the Form M–1 filing requirements are
not eligible to file the Form 5500–SF
(Short Form 5500 Annual Return/Report
of Small Employee Benefit Plan) under
§ 2520.103–1(c)(2)(ii) and § 2520.104–
41.13
Although small plans subject to the
Form M–1 filing requirements are not
eligible to file the Form 5500–SF, these
13 In addition, an unrelated technical correction
to 29 CFR 2520.104–41 is being included in this
rulemaking to add an express reference to the Form
5500–SF.

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plans are still eligible for the simplified
Form 5500 annual reporting for small
welfare plans, and these plans that meet
all of the requirements for the relief
under § 2520.104–44 are exempt from
certain financial reporting and audit
requirements. Small plan MEWAs and
ECEs that qualify for the relief provided
by 29 CFR 2520.104–44 would only
need to file the Form 5500 Annual
Return/Report and, if applicable,
Schedule A (Insurance Information) and
Schedule G, Part III (nonexempt
transactions).14 Such plans are no
longer eligible to use the Form 5500–SF
because that form does not include
Schedule A insurance information. The
Department believes that plans subject
to these final rules that claim to provide
insured benefits should be required to
complete the Schedule A so that
enforcement officials and the public
have information about the insurance
policy and insurance company through
which the plan is providing insurance
coverage. Thus, these changes give the
Secretary an important enforcement tool
while imposing minimal burden on
small plan MEWAs and ECEs.
IV. Regulatory Impact Analysis
A. Executive Order 12866 and 13563
Under Executive Order 12866, a
‘‘significant’’ regulatory action is subject
to the requirements of the Executive
Order and subject to review by the
Office of Management and Budget
(OMB). Under section 3(f) of the
Executive Order, a ‘‘significant
regulatory action’’ is an action that is
likely to result in a rule: (1) Having an
annual effect on the economy of $100
million or more, or adversely and
materially affecting a sector of the
economy, productivity, competition,
jobs, the environment, public health or
safety, or State, local or tribal
governments or communities (also
referred to as ‘‘economically
significant’’); (2) creating serious
inconsistency or otherwise interfering
with an action taken or planned by
another agency; (3) materially altering
the budgetary impacts of entitlement
grants, user fees, or loan programs or the
rights and obligations of recipients
thereof; or (4) raising novel legal or
policy issues arising out of legal
mandates, the President’s priorities, or
the principles set forth in the Executive
14 Neither these final regulations nor the
companion revisions to the Form 5500 change the
eligibility requirements for the limited exemption
under 29 CFR 2520.104–44. The Department
expects that many plan MEWAs and ECEs will not
satisfy the unfunded and insured eligibility
requirements in the limited exemption and will
continue to be ineligible for the reporting relief
under 29 CFR 2520.104–44.

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Order. OMB has determined that this
action is not economically significant
within the meaning of section 3(f)(1) of
the Executive Order but is significant
under section 3(f)(4) of the Executive
Order because it raises novel legal or
policy issues arising from the
President’s priorities. Executive Order
13563 emphasizes the importance of
quantifying both costs and benefits, of
reducing costs, of harmonizing rules,
and of promoting flexibility.
The Department estimates that the
total cost of this rule would be
approximately $137,400 in the first year,
or an average of approximately $284 for
each of the 484 entities expected to file
the Form M–1. These costs are all
associated with the information
collection request contained in these
rules and, therefore, are discussed in the
Paperwork Reduction Act Section,
below.
1. Summary and Need for Regulatory
Action
As discussed earlier in this preamble,
section 6606 of the Affordable Care Act
amended section 101(g) of ERISA to
require the Secretary of Labor to
promulgate regulations requiring
MEWAs providing medical care benefits
(within the meaning of section 733(a)(2)
of ERISA) that are not ERISA-covered
group health plans (non-plan MEWAs)
to register with the Secretary before
operating in a State.
The original MEWA reporting
requirement in ERISA section 101(g)
was enacted by Congress as part of the
Health Insurance Portability and
Accountability Act (HIPAA) of 1996 in
response to a 1992 General Accounting
Office (GAO) recommendation.15 The
GAO recommended that the Department
develop a mechanism to help States
identify fraudulent and abusive
MEWAs. The HIPAA provision led to
the Department creating the Form M–1
under a 2000 interim final rule and 2003
final rule.16
ERISA section 101(g), as amended by
the Affordable Care Act, directs the
Department of Labor (the Department) to
promulgate rules requiring MEWAs that
are not group health plans (non-plan
MEWAs) to register with the Secretary
of Labor (the Secretary) prior to
operating in a State. ERISA sections 505
and 734 provide the Secretary with the
authority to require plan MEWAs and
15 See, Employee Benefits: States Need Labor’s
Help Regulating Multiple Employer Welfare
Arrangements, March 1992, GAO/HRD–92–40.
16 65 FR 715 (02/11/2000) and 68 FR 17494 (04/
09/2003). The Form M–1 has been updated and is
reissued each year in December by the Department
and modified periodically to address changes to the
statutory provisions in part 7 of ERISA.

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ECEs to comply with the Form M–1
reporting requirements,17 but because
ERISA section 101(g) only applies to
non-plan MEWAs, only non-plan
MEWAs are subject to civil penalties
under ERISA section 502(c)(5) for
failure to comply with the Form M–1
requirements.18 In order to enhance the
Department’s ability to enforce the Form
M–1 requirements and ensure that
MEWAs are subject to the same rules
under the law, this final rule will
require all plan MEWAs to prove
compliance with the Form M–1 filing
requirements in order to satisfy the
ERISA annual reporting requirements.19
In amending the Department’s MEWA
reporting regulation to require MEWAs
to register with the Secretary before
operating in a State, these final rules
direct Form M–1 filers to provide
additional information regarding the
MEWA or ECE and apply new timing
standards for the filings that are made
when a MEWA’s or ECE’s status
changes. These amendments will aid the
Department in its oversight of MEWAs
consistent with its expanded authority
provided by the Affordable Care Act 20
and allow the Department to provide
critical information to State insurance
departments that coordinate their
investigations and enforcement actions
17 In the preamble to the 2000 interim final rule,
the Department explained ‘‘[a]n important reason
for requiring these groups to file is that the
administrator of a MEWA may incorrectly
determine that it is a group health plan or that it
is established or maintained pursuant to a collective
bargaining agreement. A reporting requirement
limited only to MEWAs that are not group health
plans may not result in reporting by many such
MEWAs, thus greatly reducing the value of the data
collected.’’ See 65 FR 7152, 7153 (Feb. 11, 2000).
18 Pursuant to ERISA section 502(c)(5), a civil
penalty of up to $1,100 (or higher amount if
adjusted pursuant to the Federal Civil Penalties
Inflation Adjustment Act of 1990, as amended) a
day may be assessed for each day a non-plan
MEWA fails to file a complete Form M–1.
19 Pursuant to ERISA section 502(c)(2), a plan
administrator who fails to file a Form 5500 Annual
Return/Report with a proof of compliance with the
M–1 filing requirements may be subject to a civil
penalty of up to $1,100 a day (or higher amount if
adjusted pursuant to the Federal Civil Penalties
Inflation Adjustment Act of 1990, as amended) for
each day a plan administrator fails or refuses to file
a complete report.
20 As part of the Affordable Care Act, Congress
also enacted ERISA section 521, which authorized
the Secretary to issue cease and desist orders,
without prior notice or a hearing, when it appears
to the Secretary that a MEWA’s alleged conduct is
fraudulent, creates an immediate danger to the
public safety or welfare, or causes or can reasonably
be expected to cause significant, imminent, and
irreparable public injury. Section 521 also
authorizes the Secretary to issue a summary order
to seize the assets of a MEWA that the Secretary
determines to be in financially hazardous
condition. The Department also is finalizing rules
for these provisions, which are published elsewhere
in today’s Federal Register.

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against fraudulent and abusive MEWAs
with the Department.
Over the last several years, the
Department has observed a downward
trend in the number of MEWAs that file
the Form M–1, raising concerns that
some existing MEWAs are not filing the
form. Under the 2003 regulation, the
Department has the ability to assess
penalties against MEWAs that fail to file
the Form M–1 only in limited
circumstances and if a determination
regarding plan status was made by the
Secretary. To address this issue and
encourage compliance with the Form
M–1 filing requirement, the Department
also is amending, as part of this
regulatory action, the Form 5500 annual
reporting requirements. The amendment
will require all plans subject to the
Form M–1 filing requirements,
regardless of plan size or type of
funding,21 to file the Form 5500 Annual
Return/Report and demonstrate on the
form compliance with Form M–1 filing
requirements. Failure to do so may
result in an assessment of penalties
under ERISA section 502(c)(2).22
These amendments to the
Department’s MEWA reporting
standards would provide a cost effective
means to implement the expanded
MEWA reporting as enacted in the
Affordable Care Act. As stated above,
the Department estimates that the
average cost for each entity that the
Department expects to file the revised
Form M–1 would average approximately
$284 during the first year and $181
during each subsequent year.
2. Benefits of Rule
As discussed earlier in this preamble,
section 6606 of the Affordable Care Act
amended section 101(g) of ERISA
directing the Secretary to promulgate
regulations requiring non-plan MEWAs
providing medical care benefits (within
the meaning of section 733(a)(2) of
ERISA) to register with the Secretary
before operating in a State. By
implementing this statutory
amendment, the Department would
receive prior notice of a MEWA’s
intention to commence operations in a
State. Such notification would help the
Department and State insurance
commissioners to ensure that MEWAs
are being lawfully operated and that
21 The final rules expressly provide that the
limited exemption for certain unfunded and
insured small welfare plans under § 2520.104–20 is
not available for any plans subject to the Form M–
1 filing requirements. In addition, these plans also
are not eligible to use the Form 5500–SF.
22 A plan administrator who fails to file a Form
5500 with a proof of Form M–1 compliance could
be subject to a civil penalty of up to $1,100 a day
for each day the plan administrator fails or refuses
to file a complete report.

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sufficient insurance has been purchased
or adequate reserves established to pay
benefit claims before the MEWAs begin
operating 23 in a State. These final rules
would improve MEWA compliance and
deter fraudulent and abusive MEWA
practices, thereby protecting and
securing the benefits of participants and
beneficiaries by ensuring that MEWA
assets are preserved and benefits timely
paid. These potential benefits have not
been quantified, but the Department
expects that they will justify the costs.
3. Costs of Rule
The costs of the rule are associated
with the amendments to the Form M–
1 and Form 5500 reporting requirements
and are therefore discussed in the
Paperwork Reduction Act section,
below.
B. Paperwork Reduction Act
In accordance with the requirements
of the Paperwork Reduction Act of 1995
(PRA) (44 U.S.C. 3506(c)(2)), the
Department submitted an information
collection request (ICR) to OMB in
accordance with 44 U.S.C. 3507(d),
contemporaneously with the
publication of the proposed regulation,
for OMB’s review.
Although no additional public
comments were received that
specifically addressed the paperwork
burden analysis of the information
collections at the proposed rules stage,
the comments that were submitted and
described earlier in this preamble,
contained information relevant to the
costs and administrative burdens
attendant to the proposals. The
Department took into account such
public comments in connection with
making changes to the final rules and in
developing the revised paperwork
burden analysis summarized below.
In connection with publication of
these final rules, the Department
submitted a revision to the ICR under
OMB Control Number 1210–0116. OMB
approved the revised ICR, which is
scheduled to expire on February 29,
2016. A copy of the revised ICR may be
obtained by contacting the PRA
addressee shown below or at http://
www.RegInfo.gov.
PRA ADDRESSEE: G. Christopher
Cosby, Office of Policy and Research,
U.S. Department of Labor, Employee
Benefits Security Administration, 200
Constitution Avenue NW., Room N–
5718, Washington, DC 20210.
Telephone: (202) 693–8410; Fax: (202)
23 Section 2520.101–2(b)(8) of the proposed rule
provides that the term ‘‘operating’’ means any
activity including but not limited to marketing,
soliciting, providing, or offering to provide medical
care benefits.

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219–4745. These are not toll-free
numbers.
Between 2006 and 2010, an average of
484 entities (MEWAs and ECEs) filed
the Form M–1 with the Department (a
high of 533 in 2006 and a low of 436
in 2010). Of the total filings, on average,
217 were submitted via mail and 267
were submitted electronically through
the Form M–1 electronic filing system
provided by the Department via the
Internet. The fraction filing electronic
returns has been increasing and reached
nearly 63 percent in 2010. This rule will
require all filings to be submitted
electronically.
As discussed above and pursuant to
section 6606 of the Affordable Care Act,
these rules amend the information
required to be disclosed on the Form M–
1 by adding new data elements.
Therefore, the Department assumes that
all administrators of MEWAs and ECEs
that file the Form M–1 in-house (an
estimated 10 percent of filers) would
spend two hours familiarizing

themselves with the changes to the form
that would be made by the final
regulations. This would result in a total
hour burden of 97 hours (48 entities *
2 hours). The Department estimates that
Part I of the Form (the identifying
information) would require five minutes
to complete. The time required to
complete Part II would vary based on
the number of States in which the entity
provides coverage, and the Department
estimates that this would require 60
minutes for single-State filers and 120
minutes for multi-State filers. The
Department expects the time required to
complete Part III would be 15 minutes
for fully-insured filers and 30 minutes
for not fully-insured filers. Table 1
below summarizes the estimates of time
required to complete each part of the
form. Based on the foregoing, the
Department estimates that the total hour
burden for entities to file the Form M–
1 using in-house resources would be
188 hours in the first year with an
equivalent cost of $17,900 assuming all

work will be performed by an employee
benefits professional at $94.91 per
hour.24 The cost to submit electronic
filings would be negligible.
The Department estimates that the
annual hour burden for Form M–1
filings prepared in-house in subsequent
years would be approximately 100
hours as summarized in Table 2.25 The
Department’s estimate is based on the
assumption that approximately 44 new
entities 26 will file the Form M–1 each
year, and thus, approximately four new
entities will prepare the Form M–1 inhouse. The Department estimates that it
would take two hours for these
administrators, resulting in an hour
burden of eight hours. The Department
estimates that entities preparing the
form in-house would spend four hours
completing Part I, 68 hours completing
Part II, and 15 hours completing Part III.
The equivalent cost of this annual hour
burden is estimated to be $8,600,
assuming a $94.91 hourly labor rate for
an employee benefits professional.

TABLE 1—TIME TO FILL OUT FORM
[Minutes]
Fully-insured
One State
New Filing ........................................................................................................
Part I ................................................................................................................
Part II ...............................................................................................................
Part III ..............................................................................................................

Not fully-insured

Multi States

120
5
60
15

One State

120
5
120
15

Multi States

120
5
60
30

120
5
120
30

TABLE 2—HOUR BURDEN TO PREPARE FORM M–1, IN-HOUSE PREPARATION
Fully-insured

Not fully-insured
Total

One State

One State

Multi States

# of MEWAs and ECEs .......................................................

16

18

9

5

48

Review: Year 1 ....................................................................
New Filing: Subsequent Years ............................................
Part I ....................................................................................
Part II ...................................................................................
Part III ..................................................................................
Total Time: Year 1 ...............................................................
Total Time: Subsequent Years ............................................

32
3
1
16
4
54
24

36
3
2
36
5
78
45

18
2
1
9
4
31
15

11
1
0
11
3
25
15

97
9
4
72
16
188
100

1. Cost Burden

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Multi States

The Department assumes that 90
percent of the 484 entities (435 entities)
that will file the Form M–1 will use
third-party service providers to
complete and submit the Form M–1.27
Because the Department is adding
additional data elements to the form, the
24 The Department estimates 2012 hourly labor
rates include wages, other benefits, and overhead
based on data from the National Occupational
Employment Survey (June 2011, Bureau of Labor
Statistics) and the Employment Cost Index

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Department assumes that in the year of
implementation, all service providers
would spend additional time
familiarizing themselves with the
changes. The Department estimates that
entities that use third party service
providers would incur the cost of one
hour for service providers to review the

new rule as service providers likely will
provide this service for multiple entities
and therefore spread this burden across
multiple entities. This results in a onetime cost burden of $41,300 (435
entities * 1 hour * $94.91).
The total estimated cost burden for
preparing the form is arrived at by

(September 2011, Bureau of Labor Statistics); the
2010 estimated labor rates are then inflated to 2012
labor rates.
25 These are rounded values. The totals may differ
slightly as a result.

26 An average of 9 percent of entities originate
each year according to Form M–1 data.
27 This assumption is made in connection with
EBSA’s principal reporting form, the Form 5500,
and was validated through a filer survey.

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multiplying the number of filers (found
in Table 3) by the amount of time
required to prepare the documents
(Table 1) and multiplying this result by
the hourly cost of an employee benefits

professional ($94.91 dollars an hour).
Based on the foregoing, the total cost
burden for entities that use purchased
third-party resources to file the Form
M–1 is $119,500 in the first year and

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$78,200 in later years. Table 3
summarizes the estimates of the cost
burden.

TABLE 3—COST BURDEN TO PREPARE FORM M–1, THIRD-PARTY PREPARATION
Fully-insured

Not fully-insured
Total

One State

Multi States

One State

Multi States

# of MEWAs and ECEs .......................................................

145

163

79

49

435

Review: Year 1 ....................................................................
New Filing: Subsequent Years ............................................
Part I ....................................................................................
Part II ...................................................................................
Part III ..................................................................................

$13,700
$0
$1,100
$13,700
$3,400

$15,400
$0
$1,300
$30,900
$3,900

$7,500
$0
$600
$7,500
$3,700

$4,700
$0
$400
$9,400
$2,300

$41,300
$0
$3,400
$61,400
$13,400

Total: Year 1 .................................................................
Total: Subsequent Years ..............................................

$32,000
$18,300

$51,400
$36,000

$19,300
$11,800

$16,800
$12,100

$119,500
$78,200

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Note: The displayed numbers are rounded to the nearest hundred and therefore may not add up to the totals.

These regulations direct a plan that is
subject to Form M–1 filing requirements
to include proof of Form M–1
compliance as part of the Form 5500.
Accordingly, the Department is adding
a new Part III to the Form 5500, that
asks for information regarding whether
the employee welfare benefit plan is
subject to the Form M–1 filing
requirements, and if so, whether the
plan is currently in compliance with the
Form M–1 filing requirements under
§ 2520.101–2. Plan administrators that
indicate the plan is subject to the Form
M–1 filing requirements also would be
required to enter the Receipt
Confirmation Code for the Form M–1
annual report or the most recent Form
M–1 required to be filed with the
Department. Failure to answer the Form
M–1 compliance questions will result in
rejection of the Form 5500 Annual
Return/Report as incomplete and civil
penalties may be assessed pursuant to
ERISA section 502(c)(2). The
Department believes that the burden
associated with this revision would be
de minimis because plan administrators
would know whether the plan is subject
to and in compliance with the Form M–
1 filing requirements, and they would
have the Receipt Confirmation Code for
the Form M–1 filing readily available.
The regulations also amend
§ 2520.104–20 to expressly provide that
the exemption from filing the Form
5500 is not available for small plans
required to file the Form M–1.
Following the methodology used to
calculate the burden in the Form 5500
regulations, the Department estimates
that for small plans that meet the
requirements of § 2520.104–44, filing a
Form 5500 and completing Schedule A
and Part III of Schedule G would cause

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them to incur an annual cost of $450 to
engage a third-party service provider to
prepare the form and schedules for
submission. The Department does not
have sufficient data to determine the
number of small plan MEWAs and ECEs
that would be required to file the Form
5500 under the final rules, but believes
that the number of such plans would be
small, because 90 percent of the entities
that file Form M–1 with the Department
cover more than 100 participants.

Estimated Number of Responses: 484
(first year); 484 (three-year average).
Frequency of Response: Annually.
Estimated Annual Burden Hours: 188
(first year); 130 (three-year average).
Estimated Annual Burden Cost:
$119,500 (first year); $92,000 (three-year
average).
C. Regulatory Flexibility Act

The Regulatory Flexibility Act (5
U.S.C. 601 et seq.) (RFA) imposes
certain requirements with respect to
2. Cost to the Government
Federal rules that are subject to the
notice and comment requirements of
The Department estimates that the
section 553(b) of the Administrative
cost to the Federal government to
Procedure Act (5 U.S.C. 551 et seq.) and
process Form M–1s is approximately
$7,200. This includes the cost to process are likely to have a significant economic
impact on a substantial number of small
online submissions and maintain the
entities. Unless an agency certifies that
processing system, and was estimated
a rule will not have a significant
by the offices within EBSA that are
economic impact on a substantial
responsible for overseeing these
number of small entities, section 603 of
activities.
the RFA requires the agency to present
an initial regulatory flexibility analysis
TABLE 4—COST OF FEDERAL
at the time of the publication of the
GOVERNMENT OF FORM M–1
notice of proposed rulemaking
describing the impact of the rule on
Processing of M1 Forms
small entities. Small entities include
Online ............................................ $2,200 small businesses, organizations and
Maintenance of System ................
5,000 governmental jurisdictions. In
accordance with the RFA, the
Total ...........................................
7,200
Department prepared an initial
regulatory flexibility analysis at the
These paperwork burden estimates
proposed rule stage and requested
are summarized as follows:
comments on the analysis. No
Type of Review: Revised collection.
comments were received. Below is the
Agency: Employee Benefits Security
Department’s final regulatory flexibility
Administration, Department of Labor.
analysis and its certification that these
Title: MEWA Form M–1
final regulations do not have a
OMB Control Number: 1210–0116
significant economic impact on a
Affected Public: Business or other for- substantial number of small entities.
profit; not-for-profit institutions.
The Department does not have data
Estimated Number of Respondents:
regarding the total number of MEWAs
484 (first year); 484 (three-year average). and ECEs that currently exist. The best

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information the Department has to
estimate the number of MEWAs and
ECEs is based on filings of the Form M–
1, which MEWAs and certain
collectively bargained arrangements
have filed annually with the
Department. Just over 436 entities filed
the Form M–1 with the Department in
2010, the latest year for which data is
available.
The Small Business Administration
uses a size standard of less than $7
million in average annual receipts as the
cut off for small business in the finance
and insurance sector.28 While the
Department does not collect revenue
information on the Form M–1, it does
collect data regarding the number of
participants covered by MEWAs and
ECEs that file Form M–1 and can use
participant data and average premium
data to determine the number of
MEWAs and ECEs that are small
entities, because their revenues do not
exceed the $7 million threshold. For
2009, the average single coverage annual
premium was $4,717 and the average
annual family coverage premium was
$12,696.29 Combining these premium
estimates with estimates of the ratio of
policies to the covered population from
the Current Population Survey at
employers with less than 500 workers
(0.309 for single coverage and 0.217 for
family coverage), the Department
estimates that 62 percent of entities
filing Form M–1 (258 entities) are small
entities.
While this number is a relatively large
fraction of all entities, it is about 7
percent when expressed as a fraction of
all participants covered by MEWAs and
ECEs. In addition, the Department notes
that the reporting burden that would be
imposed on all MEWAs and ECEs by the
rule is estimated as an average cost of
$284 for each entity filing Form M–1.
For all but the smallest MEWAs or ECEs
(less than 15 participants), this
represents less than one-half of one
percent of revenues.
The regulations also amend
§ 2520.104–20 to expressly provide that
the limited exemption from filing the
Form 5500 for certain unfunded and
insured small welfare plans is not
available for plans required to file the
Form M–1. As discussed in the PRA
section above, the Department estimates
28 U.S. Small Business Administration, ‘‘Table of
Small Business Size Standards Matched to North
American Industry Classification System Codes.’’
http://www.sba.gov/sites/default/files/
Size_Standards_Table.pdf
29 Kaiser Family Foundation and Health Research
Educational Trust, ‘‘Employer Health Benefits, 2009
Annual Survey.’’ The reported numbers are from
Exhibit 1.2 and are for the category Annual, all
Small Firms (3–199 workers).

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that these small plan MEWAs and ECEs
would incur an annual cost of $450 to
engage a third-party service provider to
prepare the form and schedules for
submission. Any burden for small ECEs
is even less because these plans are
subject to the Form M–1 filing
requirements only for limited periods.
The Department does not have sufficient
data to determine the number of small
plan MEWAs and ECEs that would be
required to file the Form 5500 under the
final rules. About 10 percent (48) of
MEWAs and ECEs filing the Form M–1
in 2010 had less than 100 participants.
However, the 2010 Form M–1 lacks
information on the source of funding to
determine which of these small MEWAs
and ECEs would be ERISA-covered
plans affected by the Final Rules.
Accordingly, the Department hereby
certifies that this regulation does not
have a significant economic impact on
a substantial number of small entities.
D. Unfunded Mandates Reform Act
For purposes of the Unfunded
Mandates Reform Act of 1995 (2 U.S.C.
1501 et seq.), as well as Executive Order
12875, this rule does not include any
federal mandate that may result in
expenditures by State, local, or tribal
governments, or the private sector,
which may impose an annual burden of
$100 million.
E. Executive Order 13132
When an agency promulgates a
regulation that has federalism
implications, Executive Order 13132 (64
FR 43255, August 10, 1999) requires the
Agency to provide a federalism
summary impact statement. Pursuant to
section 6(c) of the Order, such a
statement must include a description of
the extent of the agency’s consultation
with State and local officials, a
summary of the nature of their concerns
and the agency’s position supporting the
need to issue the regulation, and a
statement of the extent to which the
concerns of the State have been met.
This regulation has federalism
implications, because the States and the
Federal government share dual
jurisdiction over MEWAs that are
employee benefit plans or hold plan
assets. Generally, States are primarily
responsible for overseeing the financial
soundness and licensing of MEWAs
under State insurance laws. The
Department enforces ERISA’s fiduciary
responsibility provisions against
MEWAs that are ERISA plans or hold
plan assets.
Over the years, the Department and
State insurance departments have
worked closely and coordinated their
investigations and other actions against

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fraudulent and abusive MEWAs. For
example, EBSA regional offices have
met with State officials in their regions
and supported their enforcement efforts
to shut down fraudulent and abusive
MEWAs. States have often lobbied for
stronger Federal enforcement tools to
help combat fraudulent and insolvent
MEWAs. By requiring MEWAs to
register with the Department before
operating in a State by filing the Form
M–1 and to provide additional
information, these final rules respond to
the States’ concern and enhance the
State and Federal governments’ joint
mission to take enforcement action
against fraudulent and abusive MEWAs
and limit the losses suffered by
American workers, their families, and
businesses when abusive MEWAs
become insolvent and fail to reimburse
medical claims.
List of Subjects in 29 CFR Part 2520
Accounting, Employee benefit plans,
Pensions, Reporting and recordkeeping
requirements.
For the reasons set out in the
preamble, part 2520 of Chapter XXV of
Title 29 of the Code of Federal
Regulations is amended as follows:
PART 2520—[AMENDED]
1. The authority citation for part 2520
is revised to read as follows:

■

Authority: 29 U.S.C. 1021–1024, 1027,
1029–31, 1059, 1134 and 1135; Secretary of
Labor’s Order 1–2011, 77 FR 1088 (January
9, 2012). Sec. 2520.101–2 also issued under
29 U.S.C. 1181–1183, 1181 note, 1185,
1185a–d, and 1191–1191c. Sec. 2520.103–1
also issued under 26 U.S.C. 6058 note. Sec.
2520.101–6 also issued under 29 U.S.C.
1021(k); Secs. 2520.102–3, 2520.104b–1 and
2520.104b–3 also issued under 29 U.S.C.
1003, 1181–1183, 1181 note, 1185, 1185a–d,
1191, and 1191a–c. Secs. 2520.104b–1 and
2520.107 also issued under 26 U.S.C. 401
note, 111 Stat. 788;

2. Section 2520.101–2 is revised to
read as follows:

■

§ 2520.101–2 Filing by multiple employer
welfare arrangements and certain other
related entities.

(a) Basis and scope. Section 101(g) of
the Employee Retirement Income
Security Act (ERISA), as amended by
the Patient Protection and Affordable
Care Act, requires the Secretary of Labor
(the Secretary) to establish, by
regulation, a requirement that multiple
employer welfare arrangements
(MEWAs) providing benefits that consist
of medical care (as described in
paragraph (b)(6) of this section), which
are not group health plans, to register
with the Secretary prior to operating in
a State. Section 101(g) also permits the

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Secretary to require, by regulation, such
MEWAs to report, not more frequently
than annually, in such form and manner
as the Secretary may require, for the
purpose of determining the extent to
which the requirements of part 7 of
subtitle B of title I of ERISA (part 7) are
being carried out in connection with
such benefits. Section 734 of ERISA
provides that the Secretary may
promulgate such regulations as may be
necessary or appropriate to carry out the
provisions of part 7. This section sets
out requirements for reporting by
MEWAs that provide benefits that
consist of medical care and by certain
entities that claim not to be a MEWA
solely due to the exception in section
3(40)(A)(i) of ERISA (referred to in this
section as Entities Claiming Exception
or ECEs). The reporting requirements
apply regardless of whether the MEWA
or ECE is a group health plan.
(b) Definitions. As used in this
section, the following definitions apply:
(1) Administrator means—(i) The
person specifically so designated by the
terms of the instrument under which the
MEWA or ECE is operated;
(ii) If the MEWA or ECE is a group
health plan and the administrator is not
so designated, the plan sponsor (as
defined in section 3(16)(B) of ERISA); or
(iii) In the case of a MEWA or ECE for
which an administrator is not
designated and a plan sponsor cannot be
identified, jointly and severally, the
person or persons actually responsible
(whether or not so designated under the
terms of the instrument under which the
MEWA or ECE is operated) for the
control, disposition, or management of
the cash or property received by or
contributed to the MEWA or ECE,
irrespective of whether such control,
disposition, or management is exercised
directly by such person or persons or
indirectly through an agent, custodian,
or trustee designated by such person or
persons.
(2) Entity Claiming Exception (ECE)
means an entity that claims it is not a
MEWA on the basis that the entity is
established or maintained pursuant to
one or more agreements that the
Secretary finds to be collective
bargaining agreements within the
meaning of section 3(40)(A)(i) of ERISA
and § 2510.3–40.
(3) Excepted benefits means excepted
benefits within the meaning of section
733(c) of ERISA and § 2590.701–2 of
this chapter.
(4) Group health plan means a group
health plan within the meaning of
section 733(a) of ERISA and § 2590.701–
2 of this chapter.
(5) Health insurance issuer means a
health insurance issuer within the

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meaning of section 733(b)(2) of ERISA
and § 2590.701–2 of this chapter.
(6) Medical care means medical care
within the meaning of section 733(a)(2)
of ERISA and § 2590.701–2 of this
chapter.
(7) Multiple employer welfare
arrangement (MEWA) means a multiple
employer welfare arrangement within
the meaning of section 3(40) of ERISA.
(8) Operating means any activity
including but not limited to marketing,
soliciting, providing, or offering to
provide benefits consisting of medical
care.
(9) Origination means, with regard to
an ECE, the occurrence of any of the
following events (an ECE is considered
to have been originated only when an
event described below occurs)—
(i) The ECE begins operating with
regard to the employees of two or more
employers (including one or more selfemployed individuals);
(ii) The ECE begins operating
following a merger with another ECE
(unless all of the ECEs that participate
in the merger previously were last
originated at least three years prior to
the merger); or
(iii) The number of employees
receiving coverage for medical care
under the ECE is at least 50 percent
greater than the number of such
employees on the last day of the
previous calendar year (unless the
increase is due to a merger with another
ECE under which all ECEs that
participate in the merger were last
originated at least three years prior to
the merger).
(10) Reporting or to report means to
file the Form M–1 as required pursuant
to sections 101(g) of ERISA; § 2520.101–
2; or the instructions to the Form M–1.
(11) Special filing event means, with
regard to an ECE—
(i) The ECE begins knowingly
operating in any additional State or
States that were not indicated on a
previous report filed pursuant to
paragraph (e)(1)(i) or (f)(2)(i) of this
section; or
(ii) The ECE experiences a material
change as defined in the Form M–1
instructions.
(12) State means State within the
meaning of § 2590.701–2 of this chapter.
(c) Persons required to report—(1)
General rule. Except as provided in
paragraph (c)(2) of this section, the
following persons are required to report
under this section:
(i) The administrator of a MEWA
regardless of whether the entity is a
group health plan; and
(ii) The administrator of an ECE
during the three-year period following

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an event described in paragraph (b)(9) of
this section.
(2) Exceptions—(i) Nothing in this
paragraph (c) shall be construed to
require reporting under this section by
the administrator of a MEWA or ECE
described under this paragraph (c)(2)(i).
(A) A MEWA or ECE licensed or
authorized to operate as a health
insurance issuer in every State in which
it offers or provides coverage for
medical care to employees;
(B) A MEWA or ECE that provides
coverage that consists solely of excepted
benefits, which are not subject to ERISA
part 7. If the MEWA or ECE provides
coverage that consists of both excepted
benefits and other benefits for medical
care that are not excepted benefits, the
administrator of the MEWA or ECE is
required to report under this section;
(C) A MEWA or ECE that is a group
health plan not subject to ERISA,
including a governmental plan, church
plan, or a plan maintained solely for the
purpose of complying with workmen’s
compensation laws, within the meaning
of sections 4(b)(1), 4(b)(2), or 4(b)(3) of
ERISA, respectively; or
(D) A MEWA or ECE that provides
coverage only through group health
plans that are not covered by ERISA,
including governmental plans, church
plans, or plans maintained solely for the
purpose of complying with workmen’s
compensation laws within the meaning
of sections 4(b)(1), 4(b)(2), or 4(b)(3) of
ERISA, respectively (or other
arrangements not covered by ERISA,
such as health insurance coverage
offered to individuals other than in
connection with a group health plan,
known as individual market coverage).
(ii) Nothing in this paragraph (c) shall
be construed to require reporting under
this section by the administrator of an
entity that would not constitute a
MEWA or ECE but for the following
circumstances under this paragraph
(c)(2)(ii).
(A) The entity provides coverage to
the employees of two or more trades or
businesses that share a common control
interest of at least 25 percent at any time
during the plan year, applying
principles similar to the principles of
section 414(c) of the Internal Revenue
Code;
(B) The entity provides coverage to
the employees of two or more employers
due to a change in control of businesses
(such as a merger or acquisition) that
occurs for a purpose other than avoiding
Form M–1 filing and is temporary in
nature. For purposes of this paragraph,
‘‘temporary’’ means the MEWA or ECE
does not extend beyond the end of the
plan year following the plan year in
which the change in control occurs; or

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(C) The entity provides coverage to
persons (excluding spouses and
dependents) who are not employees or
former employees of the plan sponsor,
such as non-employee members of the
board of directors or independent
contractors, and the number of such
persons who are not employees or
former employees does not exceed one
percent of the total number of
employees or former employees covered
under the arrangement, determined as of
the last day of the year to be reported
or, determined as of the 60th day
following the date the MEWA or ECE
began operating in a manner such that
a filing is required pursuant to
paragraph (e)(1)(i), (2), or (3) of this
section.
(3) Examples. The rules of this
paragraph (c) are illustrated by the
following examples:
Example 1. (i) Facts. MEWA A begins
operating by offering coverage to the
employees of two or more employers on
August 1, 2013. MEWA A is licensed or
authorized to operate as a health insurance
issuer in every State in which it offers
coverage for medical care to employees.
(ii) Conclusion. In this Example 1, the
administrator of MEWA A is not required to
report via Form M–1. MEWA A meets the
exception to the filing requirement in
paragraph (c)(2)(i)(A) of this section because
it is licensed or authorized to operate as a
health insurance issuer in every State in
which it offers coverage for medical care to
employees.
Example 2. (i) Facts. Company B maintains
a group health plan that provides benefits for
medical care for its employees (and their
dependents). Company B establishes a joint
venture in which it has a 25 percent stock
ownership interest, determined by applying
the principles similar to the principles under
section 414(c) of the Internal Revenue Code,
and transfers some of its employees to the
joint venture. Company B continues to cover
these transferred employees under its group
health plan.
(ii) Conclusion. In this Example 2, the
administrator is not required to file the Form
M–1 because Company B’s group health plan
meets the exception to the filing requirement
in paragraph (c)(2)(ii)(A) of this section. This
is because Company B’s group health plan
would not constitute a MEWA but for the fact
that it provides coverage to two or more
trades or businesses that share a common
control interest of at least 25 percent.
Example 3. (i) Facts. Company C maintains
a group health plan that provides benefits for
medical care for its employees. The plan year
of Company C’s group health plan is the
fiscal year for Company C, which is October
1st—September 30th. Therefore, October 1,
2012—September 30, 2013 is the 2013 plan
year. Company C decides to sell a portion of
its business, Division Z, to Company D.
Company C signs an agreement with
Company D under which Division Z will be
transferred to Company D, effective
September 30, 2013. The change in control of

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Division Z therefore occurs on September 30,
2013. Under the terms of the agreement,
Company C agrees to continue covering all of
the employees that formerly worked for
Division Z under its group health plan until
Company D has established a new group
health plan to cover these employees. Under
the terms of the agreement, it is anticipated
that Company C will not be required to cover
the employees of Division Z under its group
health plan beyond the end of the 2014 plan
year, which is the plan year following the
plan year in which the change in control of
Division Z occurred.
(ii) Conclusion. In this Example 3, the
administrator of Company C’s group health
plan is not required to report via the Form
M–1 on March 1, 2014 for fiscal year 2013
because it is subject to the exception to the
filing requirement in paragraph (c)(2)(ii)(B) of
this section for an entity that would not
constitute a MEWA but for the fact that it is
created by a change in control of businesses
that occurs for a purpose other than to avoid
filing the Form M–1 and is temporary in
nature. Under the exception, ‘‘temporary’’
means the MEWA does not extend beyond
the end of the plan year following the plan
year in which the change in control occurs.
The administrator is not required to file the
2013 Form M–1 annual report because it is
anticipated that Company C will not be
required to cover the employees of Division
Z under its group health plan beyond the end
of the 2014 plan year, which is the plan year
following the plan year in which the change
in control of businesses occurred.
Example 4. (i) Facts. Company E maintains
a group health plan that provides benefits for
medical care for its employees (and their
dependents) as well as certain independent
contractors who are self-employed
individuals. The plan is therefore a MEWA.
The administrator of Company E’s group
health plan uses calendar year data to report
for purposes of the Form M–1. The
administrator of Company E’s group health
plan determines that the number of
independent contractors covered under the
group health plan as of the last day of
calendar year 2013 is less than one percent
of the total number of employees and former
employees covered under the plan
determined as of the last day of calendar year
2013.
(ii) Conclusion. In this Example 4, the
administrator of Company E’s group health
plan is not required to report via the Form
M–1 for calendar year 2013 (a filing that is
otherwise due by March 1, 2014) because it
is subject to the exception to the filing
requirement provided in paragraph
(c)(2)(ii)(C) of this section for entities that
cover a very small number of persons who
are not employees or former employees of the
plan sponsor.

(d) Information to be reported—(1)
Any reporting required by this section
shall consist of a completed copy of the
Form M–1 Report for Multiple Employer
Welfare Arrangements (MEWAs) and
Certain Entities Claiming Exception
(ECEs) (Form M–1) and any additional
statements required pursuant to the
instructions for the Form M–1.

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(2) Rejected filings.—The Secretary
may reject any filing under this section
if the Secretary determines that the
filing is incomplete, in accordance with
§ 2560.502c–5 of this chapter.
(3) If the Secretary rejects a filing
under paragraph (d)(2) of this section,
and if a revised filing satisfactory to the
Secretary is not submitted within 45
days after the notice of rejection, the
Secretary may bring a civil action for
such relief as may be appropriate
(including penalties under section
502(c)(5) of ERISA and § 2560.502c–5 of
this chapter).
(e) Origination, registration, and other
non-annual reporting requirements and
timing—(1) General rule for ECEs—(i)
Except as provided in paragraph
(e)(1)(ii) of this section, and subject to
the limitations established by paragraph
(c)(1)(ii) of this section, when an ECE
experiences an event described in
paragraphs (b)(9) or (b)(11) of this
section, the administrator of the ECE
shall file Form M–1 by the 30th day
following the date of the event.
(ii) Exception. Paragraph (e)(1)(i) of
this section does not apply to ECEs that
experience an origination as described
in paragraph (b)(9)(i) of this section.
Such entities are required, subject to the
limitations established by paragraph
(c)(1)(ii) of this section, to file the Form
M–1 30 days prior to the date of the
event.
(2) General rule for MEWAs—(i) In
general. Except as provided in
paragraph (e)(2)(ii) of this section, the
administrator of the MEWA is required
to register with the Secretary by filing
the Form M–1 30 days prior to operating
in any State.
(ii) Exception. Paragraph (e)(2)(i) of
this section does not apply to MEWAs
that, prior to the effective date of this
section, were already in operation in a
State (or States). Such entities are
required to submit an annual filing
pursuant to annual reporting rules
described in paragraph (f)(2)(i) of this
section for that State (or those States).
(3) Special rule requiring MEWAs to
make additional filings. Subsequent to
registering with the Secretary pursuant
to paragraph (e)(2)(i) of this section, the
administrator of a MEWA shall file the
Form M–1:
(i) Within 30 days of knowingly
operating in any additional State or
States that were not indicated on a
previous report filed pursuant to
paragraph (e)(2)(i) or (f)(2)(i) of this
section;
(ii) Within 30 days of the MEWA
operating with regard to the employees
of an additional employer (or
employers, including one or more self-

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employed individuals) after a merger
with another MEWA;
(iii) Within 30 days of the date the
number of employees receiving coverage
for medical care under the MEWA is at
least 50 percent greater than the number
of such employees on the last day of the
previous calendar year; or
(iv) Within 30 days of experiencing a
material change as defined in the Form
M–1 instructions.
(4) Anti-abuse rule. If a MEWA or ECE
neither offers nor provides benefits
consisting of medical care within a State
during the calendar year immediately
following the year in which a filing is
made by the ECE pursuant to paragraph
(e)(1) of this section (due to an event
described in paragraph (b)(9)(i) or
(b)(11)(i) of this section) or a filing is
made by the MEWA pursuant to
paragraph (e)(2) or (3) of this section,
with respect to operating in such State,
such filing will be considered to have
lapsed.
(5) Multiple filings not required in
certain circumstances. If multiple filings
are required under this paragraph (e), a
single filing will satisfy this section so
long as the filing is timely for each
required filing.
(6) Extensions. (i) An extension may
be granted for filing a report required by
paragraph (e)(1), (2), or (3) of this
section if the administrator complies
with the extension procedure prescribed
in the instructions to the Form M–1.
(ii) If the filing deadline set forth in
this paragraph (e) is a Saturday, Sunday,
or federal holiday, the form must be
filed no later than the next business day.
(f) Annual reporting requirements and
timing—(1) Period for which reporting is
required. A completed copy of the Form
M–1 is required to be filed for each
calendar year during all or part of which
the MEWA is operating and for each of
the three calendar years following an
origination during all or part of which
the ECE is operating.
(2) Filing deadline—(i) General March
1 filing due date for annual filings.
Except as provided in paragraph
(f)(2)(ii) of this section, a completed
copy of the Form M–1 is required to be
filed on or before each March 1 that
follows a period for which reporting is
required (as described in paragraph
(f)(1) of this section).
(ii) Exception. Paragraph (f)(2)(i) of
this section does not apply to ECEs and
MEWAs if, between October 1 and
December 31, the entity is required to
make a filing pursuant to paragraph
(e)(1), (2), or (3) of this section and
makes that filing timely.
(3) Extensions. (i) An extension may
be granted for filing a report required by
paragraph (f)(2)(i) of this section if the

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administrator complies with the
extension procedure prescribed in the
instructions to the Form M–1.
(ii) If the filing deadline set forth in
this paragraph (f) is a Saturday, Sunday,
or federal holiday, the form must be
filed no later than the next business day.
(4) Examples. The rules of paragraphs
(e) and (f) of this section are illustrated
by the following examples:
Example 1. (i) Facts. MEWA A began
offering coverage for medical care to the
employees of two or more employers on July
1, 2003 (and continues to offer such
coverage). MEWA A has satisfied all filing
requirements to date.
(ii) Conclusion. In this Example 1, the
administrator of MEWA A must continue to
file a timely completed Form M–1 annual
report each year, but the administrator is not
required to register with the Secretary
because MEWA A meets the exception to the
registration requirement in paragraph
(e)(2)(ii) of this section and has not
experienced any event described in
paragraph (e)(3) that would require
registering with the Secretary.
Example 2. (i) Facts. On August 25, 2013,
MEWA B is operating in State P and has
made all appropriate filings related to those
operations. On December 22, 2013 one of the
employers that participates in MEWA B is
awarded a new contract in State Q. The
employer adds an office in State Q and the
employees there are eligible to access its
group health plan.
(ii) Conclusion. In this Example 2, the
administrator of MEWA B must report the
addition of State Q by filing the Form M–1
within 30 days of knowing that it is operating
in State Q.
Example 3. (i) Facts. As of July 1, 2013,
MEWA C is preparing to operate in States Y
and Z. MEWA C is not licensed or authorized
to operate as a health insurance issuer in any
State and does not meet any of the other
exceptions set forth in paragraph (c)(2) of this
section.
(ii) Conclusion. In this Example 3, the
administrator of MEWA C is required to
register with the Secretary by filing a
completed Form M–1 30 days prior to
operating in States Y or Z. The administrator
of MEWA C must also report by filing the
Form M–1 annually by every March 1
thereafter.
Example 4. (i) Facts. As of July 28, 2013,
MEWA D is operating in States V and W.
MEWA D has satisfied the requirements of
(e)(2) and, if applicable, (e)(3) with respect to
those States. MEWA D is not licensed or
authorized to operate as a health insurance
issuer in any State and does not meet any of
the other exceptions set forth in (c)(2) of this
section. On August 5, 2013 MEWA D
knowingly begins operating in State X.
(ii) Conclusion. In this Example 4, the
administrator of MEWA D is required to
make an additional registration filing with
the Secretary by September 4, 2013 (within
30 days of knowingly operating in State X).
Additionally, the administrator of MEWA D
must continue to file the Form M–1 annually
by every March 1 thereafter.

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Example 5. (i) Facts. ECE A began offering
coverage for medical care to the employees
of two or more employers on January 1, 2007
and ECE A has not been involved in any
mergers or experienced any other origination
as described in paragraph (b)(9) of this
section.
(ii) Conclusion. In this Example 5, ECE A
was originated on January 1, 2007 and has
not been originated since then. Therefore, the
administrator of ECE A is not required to file
a 2012 Form M–1 because the last time the
ECE A was originated was January 1, 2007
which is more than three years prior. Further,
the ECE has satisfied its reporting
requirements by making three timely annual
filings after its origination.
Example 6. (i) Facts. ECE B wants to begin
offering coverage for medical care to the
employees of two or more employers on July
1, 2013.
(ii) Conclusion. In this Example 6, the
administrator of ECE B must file a completed
Form M–1 on or before June 1, 2013 (which
is 30 days prior to the origination date). In
addition, the administrator of ECE B must file
an updated copy of the Form M–1 by March
1, 2014 because the last date ECE B was
originated was July 1, 2013 (which is less
than three years prior to the March 1, 2014
due date). Furthermore, the administrator of
ECE B must file the Form M–1 by March 1,
2015 and again by March 1, 2016 (because
July 1, 2013 is less than three years prior to
March 1, 2015 and March 1, 2016,
respectively). However, if ECE B is not
involved in any mergers and does not
experience any other origination as described
in paragraph (b)(9) of this section, there
would not be a new origination date and no
Form M–1 is required to be filed after March
1, 2016.
Example 7. (i) Facts. ECE D, which
currently operates in State A and is still
within the three-year window following its
origination and the timely filing related
thereto, is making preparations to operate in
State B beginning on November 1, 2013.
(ii) Conclusion. In this Example 7, by
operating in State B, ECE D experiences a
special event within the three-year window
following its origination and must make a
filing by December 2, 2013.
Example 8. (i) Facts. Same facts as
Example 7. ECE D satisfied its special filing
requirement but is unsure about its annual
filing requirements.
(ii) Conclusion. ECE D is exempt from the
next annual filing due March 1, 2014
pursuant to the filing deadline exception
under (f)(2)(ii) of this section. However, ECE
D must continue making annual filings for
the remainder of the three years following its
origination.
Example 9. (i) Facts. MEWA E begins
distributing marketing materials on August
31, 2013.
(ii) Conclusion. In this Example 8, because
MEWA E began operating on August 31,
2013, the administrator of MEWA E must
register with the Secretary by filing a
completed Form M–1 on or before August 1,
2013 (30 days prior to operating in any State).
In addition, the administrator of MEWA E
must file the Form M–1 annually by every
March 1 thereafter.

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Example 10. (i) Facts. Same facts as
Example 9, but MEWA E registers on or
before August 1, 2013 by filing a Form M–
1 indicating it will begin operating in every
State. However, in the calendar year
immediately following the filing, MEWA E
only offered or provided benefits consisting
of medical care to participants in State Z.
(ii) Conclusion. In this Example 10, the
registration for all States (other than State Z)
have lapsed under (e)(4) because MEWA E
only offered or provided benefits consisting
of medical care to participants in State Z in
the calendar year immediately following the
filing. If subsequently, MEWA E begins
offering or providing benefits consisting of
medical care to participants in any additional
State (or States), it must make a new
registration filing pursuant to (e)(3) of this
section.

(g) Electronic filing. A completed
Form M–1 is filed with the Secretary by
submitting it electronically as
prescribed in the instructions to the
Form M–1.
(h) Penalties—(1) Civil penalties and
procedures. For information on civil
penalties under section 502(c)(5) of
ERISA for persons who fail to file the
information required under this section,
see § 2560.502c–5 of this chapter. For
information relating to administrative
hearings and appeals in connection with
the assessment of civil penalties under
section 502(c)(5) of ERISA, see
§§ 2570.90 through 2570.101 of this
chapter.
(2) Criminal penalties and
procedures. For information on criminal
penalties under section 519 of ERISA for
persons who knowingly make false
statements or false representation of fact
with regards to the information required
under this section, see section 501(b) of
ERISA.
(3) Cease and desist and summary
seizure orders. For information on the
Secretary’s authority to issue a cease
and desist or summary seizure order
under section 521 of ERISA, see
§ 2560.521.
■ 3. Section 2520.103–1 is amended by:
■ a. Revising paragraphs (a)
introductory text, (b) introductory text
and (c)(1),
■ b. Amending paragraph (c)(2)(ii)(C) by
removing the reference ‘‘and’’ at the end
of the paragraph,
■ c. Removing the period at the end of
paragraph (c)(2)(ii)(D) and adding the
reference ‘‘; and’’ at the end of the
paragraph,
■ d. Adding a new paragraph
(c)(2)(ii)(E),
■ e. Redesignating paragraph (f) as
paragraph (g) and adding a new
paragraph (f).
The revisions and additions read as
follows:

VerDate Mar<15>2010

14:12 Feb 28, 2013

Jkt 229001

§ 2520.103–1
report.

Contents of the annual

(a) In general. The administrator of a
plan required to file an annual report in
accordance with section 104(a)(1) of the
Act shall include with the annual report
the information prescribed in paragraph
(a)(1) of this section or in the simplified
report, limited exemption or alternative
method of compliance described in
paragraph (a)(2) of this section.
*
*
*
*
*
(b) Contents of the annual report for
plans with 100 or more participants
electing the limited exemption or
alternative method of compliance.
Except as provided in paragraph (d) and
paragraph (f) of this section and in
§§ 2520.103–2 and 2520.104–44, the
annual report of an employee benefit
plan covering 100 or more participants
at the beginning of the plan year which
elects the limited exemption or
alternative method of compliance
described in paragraph (a)(2) of this
section shall include:
*
*
*
*
*
(c) * * *
(1) Except as provided in paragraph
(c)(2), paragraph (d) and paragraph (f) of
this section, and in §§ 2520.104–43,
2520.104a–6, and 2520.104–44, the
annual report of an employee benefit
plan that covers fewer than 100
participants at the beginning of the plan
year shall include a Form 5500 ‘‘Annual
Return/Report of Employee Benefit
Plan’’ and any statements or schedules
required to be attached to the form,
completed in accordance with the
instructions for the form, including
Schedule A (Insurance Information),
Schedule SB (Single Employer Defined
Benefit Plan Actuarial Information),
Schedule MB (Multiemployer Defined
Benefit Plan and Certain Money
Purchase Plan Actuarial Information),
Schedule D (DFE/Participating Plan
Information), Schedule I (Financial
Information—Small Plan), and Schedule
R (Retirement Plan Information). See the
instructions for this form.
(2) * * *
(ii) * * *
(E) Is not a plan subject to the Form
M–1 requirements under § 2520.101–2
(Filing by Multiple Employer Welfare
Arrangements and Certain Other Related
Entities).
*
*
*
*
*
(f) Plans subject to the Form M–1
filing requirements under § 2520.101–2.
The annual report of an employee
welfare benefit plan that is subject to the
Form M–1 requirements under
§ 2520.101–2 (Filing by Multiple
Employer Welfare Arrangements and
Certain Other Related Entities) during

PO 00000

Frm 00026

Fmt 4700

Sfmt 9990

the plan year shall also include any
statements or information required by
the instructions to the Form 5500
relating to compliance with the Form
M–1 filing requirements under
§ 2520.101–2.
*
*
*
*
*
4. Section 2520.104–20 is amended by
removing the reference ‘‘and’’ in
paragraph (b)(2)(iii), removing the
period at the end of paragraph (b)(3)(ii)
and adding the reference ‘‘; and’’ in its
place, and adding a new paragraph
(b)(4) to read as follows:

■

§ 2520.104–20 Limited exemption for
certain small welfare plans.

*

*
*
*
*
(b) * * *
(4) Which are not subject to the Form
M–1 requirements under § 2520.101–2
(Filing by Multiple Employer Welfare
Arrangements and Certain Other Related
Entities).
*
*
*
*
*
5. In § 2520.104–41, revise paragraph
(c) to read as follows:

■

§ 2520.104–41 Simplified annual reporting
requirements for plans with fewer than 100
participants.

*

*
*
*
*
(c) Contents. The administrator of an
employee pension or welfare benefit
plan described in paragraph (b) of this
section shall file, in the manner
described in § 2520.104a–5, a completed
Form 5500 ‘‘Annual Return/Report of
Employee Benefit Plan’’ including, if
applicable, the information described in
§ 2520.103–1(f) or, to the extent eligible,
a completed Form 5500–SF ‘‘Short Form
Annual Return/Report of Small
Employee Benefit Plan,’’ and any
required schedules or statements
prescribed by the instructions to the
applicable form, and, unless waived by
§ 2520.104–44 or § 2520.104–46, a
report of an independent qualified
public accountant meeting the
requirements of § 2520.103–1(b).

Signed this 26th day of February, 2013.
Phyllis C. Borzi,
Assistant Secretary, Employee Benefits
Security Administration, Department of
Labor.
[FR Doc. 2013–04863 Filed 2–28–13; 8:45 am]
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