Reports of the Death of MEPs Are Greatly Exaggerated

Multiple employer plans (MEPs) were all the rage for the past few years, until the DOL released Advisory Opinion 2012-04A, in which it clarified its stance that “open” MEPs (those open to  any adopting employer rather than closed to a select group of employers) are not single plans under ERISA but are a collection of single plans for each adopting employer. The MEP rage has subsequently cooled, with sentiments like these being common:

  • “We were taking a hard look at MEPs but now we’ve backed off because of the DOL’s ruling.”
  • “We’re holding off because of the uncertainty about where these are heading.”

In addition to such feelings of uncertainty, some have voiced silly (or incorrect, at any rate) thoughts, like;

  • “The DOL has shot down (or ‘ruled against’) MEPs.”
  • “MEPs are no longer allowed.” 

One of my favorites, from an ambitious broker speaking to an employer participating in a MEP (I paraphrase): “You need to consult a lawyer. The DOL has ruled that MEPs are illegal.”  Read full article…

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