Labor Department Seeks Tougher Rules on ‘Multiple-Employer’ Plans

by News on December 6, 2011

in Surveys and Reports

By Bruce Japsen/The New York Times

Federal officials hope to crack down more effectively on operators of “multiple employer” health plans that have defrauded small businesses and their workers of hundreds of millions of dollars, often leaving them stuck with unpaid medical bills, according to new rules proposed Monday by the Obama administration under the health care legislation.

Known as Multiple Employer Welfare Arrangements, or MEWAs, such plans have a checkered history under operators who used federal law in the past as a shield from state insurance investigators. The plans are set up for small businesses to provide their workers with lower cost coverage by pooling premium contributions from the employers and workers together for benefits that are paid from the arrangement.

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