Definition of “Employer” Under Section 3(5) of ERISA-Association Health Plans

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This document contains a final regulation under Title I of the Employee Retirement Income Security Act (ERISA) that establishes additional criteria under ERISA section 3(5) for determining when employers may join together in a group or association of employers that will be 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 ERISA. By establishing a more flexible "commonality of interest" test for the employer members than the Department of Labor (DOL or Department) had adopted in sub- regulatory interpretive rulings under ERISA section 3(5), and otherwise removing undue restrictions on the establishment and maintenance of Association Health Plans (AHPs) under ERISA, the regulation facilitates the adoption and administration of AHPs and expands access to affordable health coverage, especially for employees of small employers and certain self-employed individuals. At the same time, the regulation continues to distinguish employment-based plans, the focal point of Title I of ERISA, from commercial insurance programs and other service provider arrangements. The final rule also