The Department of Labor (DOL) has issued a proposed final rule on Multiple Employer Welfare Agreements (MEWAs) regarding provisions in the Patient Protection and Affordable Care Act (PPACA), allowing the DOL Secretary to issue cease and desist orders and/or seize MEWAs that aren't fulfilling their obligations.

A MEWA is an alternative method of providing health insurance coverage sometimes used by small employers.

The proposed rule allows the Labor Secretary to seize a MEWA under two circumstances: if the MEWA is in danger of being unable to pay its claims and if the MEWA has sustained or is sustaining a "significant loss of assets." No court order would be required.

The proposal also allows the Secretary to issue a cease and desist order if there is fraudulent conduct, or if there is “immediate danger to the public safety or welfare” or “conduct that causes or can be reasonably expected to cause significant, immediate, and irreparable injury.”

Interested employers are invited to submit comments until March 5, 2012.  Comments may be submitted electronically through the federal eRulemaking portal, by e-mail to, and by regular mail to: Office of Health Plan Standards and Compliance Assistance, Employee Benefits Security Administration, Room N-5653, U.S. Department of Labor, 200 Constitution Avenue NW, Washington, DC 20210, Attention: RIN 1210—AB51; MEWA Registration Proposed Regulation.