MEWAs emerging from regulatory 'black hole.' (multiple employer welfare arrangements) (column)

National Underwriter Property & Casualty-Risk & Benefits Management, May, 1990 by Howard, Lisa S.

MEWAs Emerging From Regulatory `Black Hole' As health care costs escalate, many experts believe that the climate is ripe for fraud committed with the use of benefit plans called multiple employer welfare arrangements. Left unchecked, employers and their employees could be cheated out of millions of dollars.

A MEWA can be a useful arrangement for funding health benefit plans of small- and medium-sized employers that want - but often can't afford - to provide benefits for their employees. But unscrupulous MEWA operators have been known to set up a self-insured plan for employers, collect the premiums and then pack their bags and disappear in the dead of night before ever paying a claim - often before state regulators even become aware of their existence....

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