Insights

The DOL recently issued the 2018 version of Form M-1. As background, Form M-1 must be filed by multiple employer welfare arrangements (MEWAs) and certain entities claiming exception (ECEs). The Form M-1 allows those entities to report that they complied with ERISA’s group health plan mandates.

While minimal changes to the Form M-1 have been made, this year’s Form M-1 instructions have been updated to reflect changes brought about by the final regulations on association health plans (AHPs). As a reminder, AHPs are MEWAs and, as a result, must file Form M-1 annually and following certain events. Thus, in an effort to provide additional guidance, the DOL has issued a list of Form M-1 filing tips for MEWA administrators. Here are some highlights:

• Who Must File. The revised instructions define which entities are required to file in certain situations. Under both the instructions and the filing tips, filers are reminded that a MEWA that is an ERISA employee welfare benefit plan must also file Form 5500, and it must use the same name, EIN and other identifying information on both forms. Further, the instructions now describe the special filing rules for group insurance arrangements.
• Date and Type of Filing. Item 4 of Form M-1, which identifies the type of filing, now requires filers to enter the event date for a registration, origination or special filing. The filing tips explain that only MEWAs should check “annual” or “registration,” and only ECEs will check “origination” or “special.” The instructions now emphasize that “operating” for this purpose means “any activity including but not limited to marketing, soliciting, providing, or offering to provide benefits consisting of medical care.”
• Additional Details. The instructions for item 13 (actuarial soundness) emphasize the DOL’s power to issue a cease and desist order if it appears a MEWA “is fraudulent, or creates an immediate danger to the public safety or welfare.” The instructions for item 17 include a new note about completing this line for all applicable states in which the MEWA operates. Also, clarifications have been added to the instructions for item 21 regarding whether the MEWA is subject to Part 7 of ERISA.
• Annually Adjusted Penalties. The instructions specify that the maximum penalty for Form M-1 filing failures is currently $1,558 per day, but they remind filers to check for increases, since required annual adjustments take place after the Form M-1 has been published.
• Self-Compliance Tool. The self-compliance tool is no longer included on the informational Form M-1, but the form describes where to locate the tool online.
• Filing Tips. The filing tips state that insurance information for every state in which the MEWA operates must be provided, and that the information must be correct. Another tip explains that only medical insurance must be reported — not, for example, dental or vision insurance. Another reminds MEWAs that are also employee benefit plans to retain the M-1 filing confirmation number because this will be needed for the Form 5500 filing. The tips also explain that more than one Form M-1 filing requirement could apply for a year: a registration filing and an annual filing.

The filing tips and additions to the instructions appear to indicate the DOL’s expectation of an increase in Form M-1 filings due to the final AHP regulations (see June 26, 2018 edition of Compliance Corner). Therefore, MEWAs (AHPs are MEWAs) should work with their advisor and service vendors to ensure compliance with ERISA and Form M-1 filing obligations.

2018 Form M-1 »
M-1 Filing Tips for AHPs and Other MEWAs »