‘‘(c) NOTICE OF APPOINTMENT.—As soon as prac-
ticable after the Secretary’s appointment as trustee, the 
Secretary shall give notice of such appointment to— 
‘‘(1) the sponsor and plan administrator; 
‘‘(2) each participant; 
‘‘(3) each participating employer; and 
‘‘(4) if applicable, each employee organization 
which, for purposes of collective bargaining, rep-
resents plan participants. 
‘‘(d) ADDITIONAL DUTIES.—Except to the extent in-
consistent with the provisions of this title, or as may be 
otherwise ordered by the court, the Secretary, upon ap-
pointment as trustee under this section, shall be subject 
to the same duties as those of a trustee under section 704 
of title 11, United States Code, and shall have the duties 
of a fiduciary for purposes of this title. 
‘‘(e) OTHER PROCEEDINGS.—An application by the 
Secretary under this subsection may be filed notwith-
standing the pendency in the same or any other court of 
any bankruptcy, mortgage foreclosure, or equity receiver-
ship proceeding, or any proceeding to reorganize, conserve, 
or liquidate such plan or its property, or any proceeding 
to enforce a lien against property of the plan. 
‘‘(f) JURISDICTION OF COURT.— 
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‘‘(1) IN GENERAL.—Upon the filing of an appli-
cation for the appointment as trustee or the issuance 
of a decree under this section, the court to which the 
application is made shall have exclusive jurisdiction 
of the plan involved and its property wherever lo-
cated with the powers, to the extent consistent with 
the purposes of this section, of a court of the United 
States having jurisdiction over cases under chapter 
11 of title 11, United States Code. Pending an adju-
dication under this section such court shall stay, and 
upon appointment by it of the Secretary as trustee, 
such court shall continue the stay of, any pending 
mortgage foreclosure, equity receivership, or other 
proceeding to reorganize, conserve, or liquidate the 
plan, the sponsor, or property of such plan or spon-
sor, and any other suit against any receiver, conser-
vator, or trustee of the plan, the sponsor, or prop-
erty of the plan or sponsor. Pending such adjudica-
tion and upon the appointment by it of the Sec-
retary as trustee, the court may stay any proceeding 
to enforce a lien against property of the plan or the 
sponsor or any other suit against the plan or the 
sponsor. 
‘‘(2) VENUE.—An action under this section 
may be brought in the judicial district where the 
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sponsor or the plan administrator resides or does 
business or where any asset of the plan is situated. 
A district court in which such action is brought may 
issue process with respect to such action in any 
other judicial district. 
‘‘(g) PERSONNEL.—In accordance with regulations 
which shall be prescribed by the Secretary through nego-
tiated rulemaking, the Secretary shall appoint, retain, and 
compensate accountants, actuaries, and other professional 
service personnel as may be necessary in connection with 
the Secretary’s service as trustee under this section. 
‘‘SEC. 811. STATE ASSESSMENT AUTHORITY. 
‘‘(a) IN GENERAL.—Notwithstanding section 514, a 
State may impose by law a contribution tax on an associa-
tion health plan described in section 806(a)(2), if the plan 
commenced operations in such State after the date of the 
enactment of the Small Business Access and Choice for 
Entrepreneurs Act of 2007. 
‘‘(b) CONTRIBUTION TAX.—For purposes of this sec-
tion, the term ‘contribution tax’ imposed by a State on 
an association health plan means any tax imposed by such 
State if— 
‘‘(1) such tax is computed by applying a rate to 
the amount of premiums or contributions, with re-
spect to individuals covered under the plan who are 
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residents of such State, which are received by the 
plan from participating employers located in such 
State or from such individuals; 
‘‘(2) the rate of such tax does not exceed the 
rate of any tax imposed by such State on premiums 
or contributions received by insurers or health main-
tenance organizations for health insurance coverage 
offered in such State in connection with a group 
health plan; 
‘‘(3) such tax is otherwise nondiscriminatory; 
and 
‘‘(4) the amount of any such tax assessed on 
the plan is reduced by the amount of any tax or as-
sessment otherwise imposed by the State on pre-
miums, contributions, or both received by insurers or 
health maintenance organizations for health insur-
ance coverage, aggregate excess/stop loss insurance 
(as defined in section 806(g)(1)), specific excess/stop 
loss insurance (as defined in section 806(g)(2)), 
other insurance related to the provision of medical 
care under the plan, or any combination thereof pro-
vided by such insurers or health maintenance organi-
zations in such State in connection with such plan. 
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‘‘SEC. 812. SPECIAL RULES FOR CHURCH PLANS. 
‘‘(a) ELECTION
FOR CHURCH PLANS.—Notwith-
standing section 4(b)(2), if a church, a convention or asso-
ciation of churches, or an organization described in section 
3(33)(C)(i) maintains a church plan which is a group 
health plan (as defined in section 733(a)(1)), and such 
church, convention, association, or organization makes an 
election with respect to such plan under this subsection 
(in such form and manner as the Secretary may by regula-
tion prescribe), then the provisions of this section shall 
apply to such plan, with respect to benefits provided under 
such plan consisting of medical care, as if section 4(b)(2) 
did not contain an exclusion for church plans. Nothing in 
this subsection shall be construed to render any other sec-
tion of this title applicable to church plans, except to the 
extent that such other section is incorporated by reference 
in this section. 
‘‘(b) EFFECT OF ELECTION.— 
‘‘(1) PREEMPTION OF STATE INSURANCE LAWS 
REGULATING COVERED CHURCH PLANS.—Subject to 
paragraphs (2) and (3), this section shall supersede 
any and all State laws which regulate insurance in-
sofar as they may now or hereafter regulate church 
plans to which this section applies or trusts estab-
lished under such church plans. 
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‘‘(2) GENERAL STATE INSURANCE REGULATION 
UNAFFECTED.— 
‘‘(A) IN GENERAL.—Except as provided in 
subparagraph (B) and paragraph (3), nothing 
in this section shall be construed to exempt or 
relieve any person from any provision of State 
law which regulates insurance. 
‘‘(B) CHURCH PLANS NOT TO BE DEEMED 
INSURANCE COMPANIES OR INSURERS.—Neither 
a church plan to which this section applies, nor 
any trust established under such a church plan, 
shall be deemed to be an insurance company or 
other insurer or to be engaged in the business 
of insurance for purposes of any State law pur-
porting to regulate insurance companies or in-
surance contracts. 
‘‘(3) PREEMPTION
OF
CERTAIN
STATE
LAWS 
RELATING
TO
PREMIUM
RATE
REGULATION
AND 
BENEFIT MANDATES.—The provisions of subsections 
(a)(2)(B) and (b) of section 805 shall apply with re-
spect to a church plan to which this section applies 
in the same manner and to the same extent as such 
provisions apply with respect to association health 
plans. 
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‘‘(4) DEFINITIONS.—For purposes of this sub-
section— 
‘‘(A) STATE LAW.—The term ‘State law’ 
includes all laws, decisions, rules, regulations, 
or other State action having the effect of law, 
of any State. A law of the United States appli-
cable only to the District of Columbia shall be 
treated as a State law rather than a law of the 
United States. 
‘‘(B) STATE.—The term ‘State’ includes a 
State, any political subdivision thereof, or any 
agency or instrumentality of either, which pur-
ports to regulate, directly or indirectly, the 
terms and conditions of church plans covered by 
this section. 
‘‘(c) 
REQUIREMENTS
FOR
COVERED
CHURCH 
PLANS.— 
‘‘(1) FIDUCIARY RULES AND EXCLUSIVE PUR-
POSE.—A fiduciary shall discharge his duties with 
respect to a church plan to which this section ap-
plies— 
‘‘(A) for the exclusive purpose of: 
‘‘(i) providing benefits to participants 
and their beneficiaries; and 
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‘‘(ii) defraying reasonable expenses of 
administering the plan; 
‘‘(B) with the care, skill, prudence and dili-
gence under the circumstances then prevailing 
that a prudent man acting in a like capacity 
and familiar with such matters would use in the 
conduct of an enterprise of a like character and 
with like aims; and 
‘‘(C) in accordance with the documents 
and instruments governing the plan. 
The requirements of this paragraph shall not be 
treated as not satisfied solely because the plan as-
sets are commingled with other church assets, to the 
extent that such plan assets are separately ac-
counted for. 
‘‘(2) CLAIMS PROCEDURE.—In accordance with 
regulations of the Secretary, every church plan to 
which this section applies shall— 
‘‘(A) provide adequate notice in writing to 
any participant or beneficiary whose claim for 
benefits under the plan has been denied, setting 
forth the specific reasons for such denial, writ-
ten in a manner calculated to be understood by 
the participant; 
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‘‘(B) afford a reasonable opportunity to 
any participant whose claim for benefits has 
been denied for a full and fair review by the ap-
propriate fiduciary of the decision denying the 
claim; and 
‘‘(C) provide a written statement to each 
participant describing the procedures estab-
lished pursuant to this paragraph. 
‘‘(3) ANNUAL
STATEMENTS.—In accordance 
with regulations of the Secretary, every church plan 
to which this section applies shall file with the Sec-
retary an annual statement— 
‘‘(A) stating the names and addresses of 
the plan and of the church, convention, or asso-
ciation maintaining the plan (and its principal 
place of business); 
‘‘(B) certifying that it is a church plan to 
which this section applies and that it complies 
with the requirements of paragraphs (1) and 
(2); 
‘‘(C) identifying the States in which par-
ticipants and beneficiaries under the plan are or 
likely will be located during the 1-year period 
covered by the statement; and 
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‘‘(D) containing a copy of a statement of 
actuarial opinion signed by a qualified actuary 
that the plan maintains capital, reserves, insur-
ance, other financial arrangements, or any com-
bination thereof adequate to enable the plan to 
fully meet all of its financial obligations on a 
timely basis. 
‘‘(4) DISCLOSURE.—At the time that the an-
nual statement is filed by a church plan with the 
Secretary pursuant to paragraph (3), a copy of such 
statement shall be made available by the Secretary 
to the State insurance commissioner (or similar offi-
cial) of any State. The name of each church plan 
and sponsoring organization filing an annual state-
ment in compliance with paragraph (3) shall be pub-
lished annually in the Federal Register. 
‘‘(d) ENFORCEMENT.—The Secretary may enforce 
the provisions of this section in a manner consistent with 
section 502, to the extent applicable with respect to ac-
tions under section 502(a)(5), and with section 3(33)(D), 
except that, other than for the purpose of seeking a tem-
porary restraining order, a civil action may be brought 
with respect to the plan’s failure to meet any requirement 
of this section only if the plan fails to correct its failure 
within the correction period described in section 3(33)(D). 
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The other provisions of part 5 (except sections 501(a), 
503, 512, 514, and 515) shall apply with respect to the 
enforcement and administration of this section. 
‘‘(e) DEFINITIONS AND OTHER RULES.—For pur-
poses of this section— 
‘‘(1) IN GENERAL.—Except as otherwise pro-
vided in this section, any term used in this section 
which is defined in any provision of this title shall 
have the definition provided such term by such pro-
vision. 
‘‘(2) SEMINARY STUDENTS.—Seminary students 
who are enrolled in an institution of higher learning 
described in section 3(33)(C)(iv) and who are treat-
ed as participants under the terms of a church plan 
to which this section applies shall be deemed to be 
employees as defined in section 3(6) if the number 
of such students constitutes an insignificant portion 
of the total number of individuals who are treated 
as participants under the terms of the plan. 
‘‘SEC. 813. DEFINITIONS AND RULES OF CONSTRUCTION. 
‘‘(a) DEFINITIONS.—For purposes of this part— 
‘‘(1) GROUP HEALTH PLAN.—The term ‘group 
health plan’ has the meaning provided in section 
733(a)(1) (after applying subsection (b) of this sec-
tion). 
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‘‘(2) MEDICAL CARE.—The term ‘medical care’ 
has the meaning provided in section 733(a)(2). 
‘‘(3) HEALTH
INSURANCE
COVERAGE.—The 
term ‘health insurance coverage’ has the meaning 
provided in section 733(b)(1). 
‘‘(4) HEALTH INSURANCE ISSUER.—The term 
‘health insurance issuer’ has the meaning provided 
in section 733(b)(2). 
‘‘(5) APPLICABLE AUTHORITY.— 
‘‘(A) IN GENERAL.—Except as provided in 
subparagraph (B), the term ‘applicable author-
ity’ means, in connection with an association 
health plan— 
‘‘(i) the State recognized pursuant to 
subsection (c) of section 506 as the State 
to which authority has been delegated in 
connection with such plan; or 
‘‘(ii) if there is no State referred to in 
clause (i), the Secretary. 
‘‘(B) EXCEPTIONS.— 
‘‘(i) 
JOINT
AUTHORITIES.—Where 
such term appears in section 808(3), sec-
tion 807(e) (in the first instance), section 
809(a) (in the second instance), section 
809(a) (in the fourth instance), and sec-
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101 
vidual who is an employee of such employer, a part-
ner in such employer, or a self-employed individual 
who is such employer (or any dependent, as defined 
under the terms of the plan, of such individual) is 
or was covered under such plan in connection with 
the status of such individual as such an employee, 
partner, or self-employed individual in relation to the 
plan. 
‘‘(9) APPLICABLE
STATE
AUTHORITY.—The 
term ‘applicable State authority’ means, with respect 
to a health insurance issuer in a State, the State in-
surance commissioner or official or officials des-
ignated by the State to enforce the requirements of 
title XXVII of the Public Health Service Act for the 
State involved with respect to such issuer. 
‘‘(10) QUALIFIED ACTUARY.—The term ‘quali-
fied actuary’ means an individual who is a member 
of the American Academy of Actuaries or meets 
such reasonable standards and qualifications as the 
Secretary may provide by regulation through nego-
tiated rulemaking. 
‘‘(11) AFFILIATED MEMBER.—The term ‘affili-
ated member’ means, in connection with a sponsor— 
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102 
‘‘(A) a person who is otherwise eligible to 
be a member of the sponsor but who elects an 
affiliated status with the sponsor, 
‘‘(B) in the case of a sponsor with mem-
bers which consist of associations, a person who 
is a member of any such association and elects 
an affiliated status with the sponsor, or 
‘‘(C) in the case of an association health 
plan in existence on the date of the enactment 
of the Small Business Access and Choice for 
Entrepreneurs Act of 2007, a person eligible to 
be a member of the sponsor or one of its mem-
ber associations. 
‘‘(12) LARGE EMPLOYER.—The term ‘large em-
ployer’ means, in connection with a group health 
plan with respect to a plan year, an employer who 
employed an average of at least 51 employees on 
business days during the preceding calendar year 
and who employs at least 2 employees on the first 
day of the plan year. 
‘‘(13) SMALL EMPLOYER.—The term ‘small em-
ployer’ means, in connection with a group health 
plan with respect to a plan year, an employer who 
is not a large employer. 
‘‘(b) RULES OF CONSTRUCTION.— 
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103 
‘‘(1) EMPLOYERS AND EMPLOYEES.—For pur-
poses of determining whether a plan, fund, or pro-
gram is an employee welfare benefit plan which is an 
association health plan, and for purposes of applying 
this title in connection with such plan, fund, or pro-
gram so determined to be such an employee welfare 
benefit plan— 
‘‘(A) in the case of a partnership, the term 
‘employer’ (as defined in section (3)(5)) in-
cludes the partnership in relation to the part-
ners, and the term ‘employee’ (as defined in 
section (3)(6)) includes any partner in relation 
to the partnership; and 
‘‘(B) in the case of a self-employed indi-
vidual, the term ‘employer’ (as defined in sec-
tion 3(5)) and the term ‘employee’ (as defined 
in section 3(6)) shall include such individual. 
‘‘(2) PLANS, FUNDS, AND PROGRAMS TREATED 
AS EMPLOYEE WELFARE BENEFIT PLANS.—In the 
case of any plan, fund, or program which was estab-
lished or is maintained for the purpose of providing 
medical care (through the purchase of insurance or 
otherwise) for employees (or their dependents) cov-
ered thereunder and which demonstrates to the Sec-
retary that all requirements for certification under 
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104 
this part would be met with respect to such plan, 
fund, or program if such plan, fund, or program 
were a group health plan, such plan, fund, or pro-
gram shall be treated for purposes of this title as an 
employee welfare benefit plan on and after the date 
of such demonstration.’’. 
(b) CONFORMING AMENDMENTS
TO PREEMPTION 
RULES.— 
(1) Section 514(b)(6) of such Act (29 U.S.C. 
1144(b)(6)) is amended by adding at the end the 
following new subparagraph: 
‘‘(E) The preceding subparagraphs of this paragraph 
do not apply with respect to any State law in the case 
of an association health plan which is certified under part 
8.’’. 
(2) Section 514 of such Act (29 U.S.C. 1144) 
is amended— 
(A) in subsection (b)(4), by striking ‘‘Sub-
section (a)’’ and inserting ‘‘Subsections (a) and 
(d)’’; 
(B) in subsection (b)(5), by striking ‘‘sub-
section (a)’’ in subparagraph (A) and inserting 
‘‘subsection (a) of this section and subsections 
(a)(2)(B) and (b) of section 805’’, and by strik-
ing ‘‘subsection (a)’’ in subparagraph (B) and 
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105 
inserting ‘‘subsection (a) of this section or sub-
section (a)(2)(B) or (b) of section 805’’; 
(C) by redesignating subsection (d) as sub-
section (e); and 
(D) by inserting after subsection (c) the 
following new subsection: 
‘‘(d)(1) Except as provided in subsection (b)(4), the 
provisions of this title shall supersede any and all State 
laws insofar as they may now or hereafter preclude, or 
have the effect of precluding, a health insurance issuer 
from offering health insurance coverage in connection with 
an association health plan which is certified under part 
8. 
‘‘(2) Except as provided in paragraphs (4) and (5) 
of subsection (b) of this section— 
‘‘(A) In any case in which health insurance cov-
erage of any policy type is offered under an associa-
tion health plan certified under part 8 to a partici-
pating employer operating in such State, the provi-
sions of this title shall supersede any and all laws 
of such State insofar as they may preclude a health 
insurance issuer from offering health insurance cov-
erage of the same policy type to other employers op-
erating in the State which are eligible for coverage 
under such association health plan, whether or not 
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106 
such other employers are participating employers in 
such plan. 
‘‘(B) In any case in which health insurance cov-
erage of any policy type is offered under an associa-
tion health plan in a State and the filing, with the 
applicable State authority, of the policy form in con-
nection with such policy type is approved by such 
State authority, the provisions of this title shall su-
persede any and all laws of any other State in which 
health insurance coverage of such type is offered, in-
sofar as they may preclude, upon the filing in the 
same form and manner of such policy form with the 
applicable State authority in such other State, the 
approval of the filing in such other State. 
‘‘(3) For additional provisions relating to association 
health plans, see subsections (a)(2)(B) and (b) of section 
805. 
‘‘(4) For purposes of this subsection, the term ‘asso-
ciation health plan’ has the meaning provided in section 
801(a), and the terms ‘health insurance coverage’, ‘par-
ticipating employer’, and ‘health insurance issuer’ have 
the meanings provided such terms in section 811, respec-
tively.’’. 
(3) Section 514(b)(6)(A) of such Act (29 
U.S.C. 1144(b)(6)(A)) is amended— 
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107 
(A) in clause (i)(II), by striking ‘‘and’’ at 
the end; 
(B) in clause (ii), by inserting ‘‘and which 
does not provide medical care (within the mean-
ing of section 733(a)(2)),’’ after ‘‘arrange-
ment,’’, and by striking ‘‘title.’’ and inserting 
‘‘title, and’’; and 
(C) by adding at the end the following new 
clause: 
‘‘(iii) subject to subparagraph (E), in the case 
of any other employee welfare benefit plan which is 
a multiple employer welfare arrangement and which 
provides medical care (within the meaning of section 
733(a)(2)), any law of any State which regulates in-
surance may apply.’’. 
(4) Section 514(e) of such Act (as redesignated 
by paragraph (2)(C)) is amended— 
(A) by striking ‘‘Nothing’’ and inserting 
‘‘(1) Except as provided in paragraph (2), noth-
ing’’; and 
(B) by adding at the end the following new 
paragraph: 
‘‘(2) Nothing in any other provision of law enacted 
on or after the date of the enactment of the Small Busi-
ness Access and Choice for Entrepreneurs Act of 2007 
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108 
shall be construed to alter, amend, modify, invalidate, im-
pair, or supersede any provision of this title, except by 
specific cross-reference to the affected section.’’. 
(c) PLAN SPONSOR.—Section 3(16)(B) of such Act 
(29 U.S.C. 102(16)(B)) is amended by adding at the end 
the following new sentence: ‘‘Such term also includes a 
person serving as the sponsor of an association health plan 
under part 8.’’. 
(d) DISCLOSURE OF SOLVENCY PROTECTIONS RE-
LATED TO SELF-INSURED AND FULLY INSURED OPTIONS 
UNDER ASSOCIATION HEALTH PLANS.—Section 102(b) 
of such Act (29 U.S.C. 102(b)) is amended by adding at 
the end the following: ‘‘An association health plan shall 
include in its summary plan description, in connection 
with each benefit option, a description of the form of sol-
vency or guarantee fund protection secured pursuant to 
this Act or applicable State law, if any.’’. 
(e) SAVINGS CLAUSE.—Section 731(c) of such Act is 
amended by inserting ‘‘or part 8’’ after ‘‘this part’’. 
(f) REPORT TO THE CONGRESS REGARDING CERTIFI-
CATION
OF
SELF-INSURED
ASSOCIATION
HEALTH 
PLANS.—Not later than January 1, 2010, the Secretary 
of Labor shall report to the Committee on Education and 
the Workforce of the House of Representatives and the 
Committee on Health, Education, Labor, and Pensions of 
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109 
the Senate the effect association health plans have had, 
if any, on reducing the number of uninsured individuals. 
(g) CLERICAL AMENDMENT.—The table of contents 
in section 1 of the Employee Retirement Income Security 
Act of 1974 is amended by inserting after the item relat-
ing to section 734 the following new items: 
‘‘PART 8—RULES GOVERNING ASSOCIATION HEALTH PLANS 
‘‘Sec. 801. Association health plans. 
‘‘Sec. 802. Certification of association health plans. 
‘‘Sec. 803. Requirements relating to sponsors and boards of trustees. 
‘‘Sec. 804. Participation and coverage requirements. 
‘‘Sec. 805. Other requirements relating to plan documents, contribution rates, 
and benefit options. 
‘‘Sec. 806. Maintenance of reserves and provisions for solvency for plans pro-
viding health benefits in addition to health insurance coverage. 
‘‘Sec. 807. Requirements for application and related requirements. 
‘‘Sec. 808. Notice requirements for voluntary termination. 
‘‘Sec. 809. Corrective actions and mandatory termination. 
‘‘Sec. 810. Trusteeship by the Secretary of insolvent association health plans 
providing health benefits in addition to health insurance cov-
erage. 
‘‘Sec. 811. State assessment authority. 
‘‘Sec. 812. Special rules for church plans. 
‘‘Sec. 813. Definitions and rules of construction.’’. 
SEC. 403. CLARIFICATION OF TREATMENT OF SINGLE EM-
PLOYER ARRANGEMENTS. 
Section 3(40)(B) of the Employee Retirement Income 
Security Act of 1974 (29 U.S.C. 1002(40)(B)) is amend-
ed— 
(1) in clause (i), by inserting ‘‘for any plan year 
of any such plan, or any fiscal year of any such 
other arrangement,’’ after ‘‘single employer’’, and by 
inserting ‘‘during such year or at any time during 
the preceding 1-year period’’ after ‘‘control group’’; 
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110 
(2) in clause (iii)— 
(A) by striking ‘‘common control shall not 
be based on an interest of less than 25 percent’’ 
and inserting ‘‘an interest of greater than 25 
percent may not be required as the minimum 
interest necessary for common control’’; and 
(B) by striking ‘‘similar to’’ and inserting 
‘‘consistent and coextensive with’’; 
(3) by redesignating clauses (iv) and (v) as 
clauses (v) and (vi), respectively; and 
(4) by inserting after clause (iii) the following 
new clause: 
‘‘(iv) in determining, after the application of 
clause (i), whether benefits are provided to employ-
ees of two or more employers, the arrangement shall 
be treated as having only one participating employer 
if, after the application of clause (i), the number of 
individuals who are employees and former employees 
of any one participating employer and who are cov-
ered under the arrangement is greater than 75 per-
cent of the aggregate number of all individuals who 
are employees or former employees of participating 
employers and who are covered under the arrange-
ment;’’. 
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111 
SEC. 404. CLARIFICATION OF TREATMENT OF CERTAIN 
COLLECTIVELY 
BARGAINED 
ARRANGE-
MENTS. 
(a) IN GENERAL.—Section 3(40)(A)(i) of the Em-
ployee Retirement Income Security Act of 1974 (29 
U.S.C. 1002(40)(A)(i)) is amended to read as follows: 
‘‘(i)(I) under or pursuant to one or more collec-
tive bargaining agreements which are reached pursu-
ant to collective bargaining described in section 8(d) 
of the National Labor Relations Act (29 U.S.C. 
158(d)) or paragraph Fourth of section 2 of the 
Railway Labor Act (45 U.S.C. 152, paragraph 
Fourth) or which are reached pursuant to labor- 
management negotiations under similar provisions of 
State public employee relations laws, and (II) in ac-
cordance with subparagraphs (C), (D), and (E);’’. 
(b) LIMITATIONS.—Section 3(40) of such Act (29 
U.S.C. 1002(40)) is amended by adding at the end the 
following new subparagraphs: 
‘‘(C) For purposes of subparagraph (A)(i)(II), a plan 
or other arrangement shall be treated as established or 
maintained in accordance with this subparagraph only if 
the following requirements are met: 
‘‘(i) The plan or other arrangement, and the 
employee organization or any other entity sponsoring 
the plan or other arrangement, do not— 
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112 
‘‘(I) utilize the services of any licensed in-
surance agent or broker for soliciting or enroll-
ing employers or individuals as participating 
employers or covered individuals under the plan 
or other arrangement; or 
‘‘(II) pay any type of compensation to a 
person, other than a full time employee of the 
employee organization (or a member of the or-
ganization to the extent provided in regulations 
prescribed by the Secretary through negotiated 
rulemaking), that is related either to the volume 
or number of employers or individuals solicited 
or enrolled as participating employers or cov-
ered individuals under the plan or other ar-
rangement, or to the dollar amount or size of 
the contributions made by participating employ-
ers or covered individuals to the plan or other 
arrangement; 
except to the extent that the services used by the 
plan, arrangement, organization, or other entity con-
sist solely of preparation of documents necessary for 
compliance with the reporting and disclosure re-
quirements of part 1 or administrative, investment, 
or consulting services unrelated to solicitation or en-
rollment of covered individuals. 
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113 
‘‘(ii) As of the end of the preceding plan year, 
the number of covered individuals under the plan or 
other arrangement who are neither— 
‘‘(I) employed within a bargaining unit 
covered by any of the collective bargaining 
agreements with a participating employer (nor 
covered on the basis of an individual’s employ-
ment in such a bargaining unit); nor 
‘‘(II) present employees (or former employ-
ees who were covered while employed) of the 
sponsoring employee organization, of an em-
ployer who is or was a party to any of the col-
lective bargaining agreements, or of the plan or 
other arrangement or a related plan or arrange-
ment (nor covered on the basis of such present 
or former employment); 
does not exceed 15 percent of the total number of 
individuals who are covered under the plan or ar-
rangement and who are present or former employees 
who are or were covered under the plan or arrange-
ment pursuant to a collective bargaining agreement 
with a participating employer. The requirements of 
the preceding provisions of this clause shall be treat-
ed as satisfied if, as of the end of the preceding plan 
year, such covered individuals are comprised solely 
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114 
of individuals who were covered individuals under 
the plan or other arrangement as of the date of the 
enactment of the Small Business Access and Choice 
for Entrepreneurs Act of 2003 and, as of the end of 
the preceding plan year, the number of such covered 
individuals does not exceed 25 percent of the total 
number of present and former employees enrolled 
under the plan or other arrangement. 
‘‘(iii) The employee organization or other entity 
sponsoring the plan or other arrangement certifies 
to the Secretary each year, in a form and manner 
which shall be prescribed by the Secretary through 
negotiated rulemaking that the plan or other ar-
rangement meets the requirements of clauses (i) and 
(ii). 
‘‘(D) For purposes of subparagraph (A)(i)(II), a plan 
or arrangement shall be treated as established or main-
tained in accordance with this subparagraph only if— 
‘‘(i) all of the benefits provided under the plan 
or arrangement consist of health insurance coverage; 
or 
‘‘(ii)(I) the plan or arrangement is a multiem-
ployer plan; and 
‘‘(II) the requirements of clause (B) of the pro-
viso to clause (5) of section 302(c) of the Labor 
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115 
Management Relations Act, 1947 (29 U.S.C. 
186(c)) are met with respect to such plan or other 
arrangement. 
‘‘(E) For purposes of subparagraph (A)(i)(II), a plan 
or arrangement shall be treated as established or main-
tained in accordance with this subparagraph only if— 
‘‘(i) the plan or arrangement is in effect as of 
the date of the enactment of the Small Business Ac-
cess and Choice for Entrepreneurs Act of 2007; or 
‘‘(ii) the employee organization or other entity 
sponsoring the plan or arrangement— 
‘‘(I) has been in existence for at least 3 
years; or 
‘‘(II) demonstrates to the satisfaction of 
the Secretary that the requirements of subpara-
graphs (C) and (D) are met with respect to the 
plan or other arrangement.’’. 
(c) CONFORMING AMENDMENTS TO DEFINITIONS OF 
PARTICIPANT AND BENEFICIARY.—Section 3(7) of such 
Act (29 U.S.C. 1002(7)) is amended by adding at the end 
the following new sentence: ‘‘Such term includes an indi-
vidual who is a covered individual described in paragraph 
(40)(C)(ii).’’. 
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116 
SEC. 405. ENFORCEMENT PROVISIONS. 
(a) CRIMINAL PENALTIES FOR CERTAIN WILLFUL 
MISREPRESENTATIONS.—Section 501 of the Employee 
Retirement Income Security Act of 1974 (29 U.S.C. 1131) 
is amended— 
(1) by inserting ‘‘(a)’’ after ‘‘Sec. 501.’’; and 
(2) by adding at the end the following new sub-
section: 
‘‘(b) Any person who willfully falsely represents, to 
any employee, any employee’s beneficiary, any employer, 
the Secretary, or any State, a plan or other arrangement 
established or maintained for the purpose of offering or 
providing any benefit described in section 3(1) to employ-
ees or their beneficiaries as— 
‘‘(1) being an association health plan which has 
been certified under part 8; 
‘‘(2) having been established or maintained 
under or pursuant to one or more collective bar-
gaining agreements which are reached pursuant to 
collective bargaining described in section 8(d) of the 
National Labor Relations Act (29 U.S.C. 158(d)) or 
paragraph Fourth of section 2 of the Railway Labor 
Act (45 U.S.C. 152, paragraph Fourth) or which are 
reached pursuant to labor-management negotiations 
under similar provisions of State public employee re-
lations laws; or 
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‘‘(3) being a plan or arrangement with respect 
to which the requirements of subparagraph (C), (D), 
or (E) of section 3(40) are met; 
shall, upon conviction, be imprisoned not more than 5 
years, be fined under title 18, United States Code, or 
both.’’. 
(b) CEASE ACTIVITIES ORDERS.—Section 502 of 
such Act (29 U.S.C. 1132) is amended by adding at the 
end the following new subsection: 
‘‘(n)(1) Subject to paragraph (2), upon application 
by the Secretary showing the operation, promotion, or 
marketing of an association health plan (or similar ar-
rangement providing benefits consisting of medical care 
(as defined in section 733(a)(2))) that— 
‘‘(A) is not certified under part 8, is subject 
under section 514(b)(6) to the insurance laws of any 
State in which the plan or arrangement offers or 
provides benefits, and is not licensed, registered, or 
otherwise approved under the insurance laws of such 
State; or 
‘‘(B) is an association health plan certified 
under part 8 and is not operating in accordance with 
the requirements under part 8 for such certification, 
a district court of the United States shall enter an order 
requiring that the plan or arrangement cease activities. 
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‘‘(2) Paragraph (1) shall not apply in the case of an 
association health plan or other arrangement if the plan 
or arrangement shows that— 
‘‘(A) all benefits under it referred to in para-
graph (1) consist of health insurance coverage; and 
‘‘(B) with respect to each State in which the 
plan or arrangement offers or provides benefits, the 
plan or arrangement is operating in accordance with 
applicable State laws that are not superseded under 
section 514. 
‘‘(3) The court may grant such additional equitable 
relief, including any relief available under this title, as it 
deems necessary to protect the interests of the public and 
of persons having claims for benefits against the plan.’’. 
(c) RESPONSIBILITY
FOR CLAIMS PROCEDURE.— 
Section 503 of such Act (29 U.S.C. 1133) is amended— 
(1) by inserting ‘‘(a) In General.—’’ after ‘‘Sec. 
503.’’; and 
(2) by adding at the end the following new sub-
section: 
‘‘(b) ASSOCIATION HEALTH PLANS.—The terms of 
each association health plan which is or has been certified 
under part 8 shall require the board of trustees or the 
named fiduciary (as applicable) to ensure that the require-
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