Following the President’s October 2017 Executive Order, the DOL released its proposed rule on Association Health Plans January 5. The proposed rule expands who may be considered an ‘employer’ within the meaning under ERISA. Specifically, the rule:
“...would broaden the criteria under ERISA section 3(5) for determining when
employers may join together in an employer group or association that is treated
as the “employer” sponsor of a single multiple-employer “employee welfare
benefit plan” and “group health plan” as those terms are defined in Title I of
If passed, small employers will be able to join together and form a ‘small business health plan’ (also called an association plan) based on geographic location or shared industry. Association plans will also be permitted to be sold across state lines. Self-employed individuals will be able to join small business health plans. The premiums for these plans cannot vary based on health factors, nor can enrollment in the plan be denied on the basis of an individual's health factors. Comments on the rule are due by March 6, after which time the DOL will release a final rule and effective date.