While I loved the fact that pooled employer plan (PEP) is an option as a multiple employer plan (MEP) under the SECURE Act, the problem is that one huge problem concerning MEPs remains and can’t be fixed by law. It’s the slow sales cycle in building up MEP assets to achieve the affordability that the MEPs are advertised for.
Creating a successful MEP is all about creating a plan of critical mass to support the fee charges and to support the costs of a plan audit. The problem is that the sales cycle for a MEP is very difficult and slow. I’m involved with a MEP that now has $87 million and that took 5 years to achieve.
It’s important that any MEP has a strong method of distribution. Having access to thousands of potential adopting employers is great, but the chances of them signing up are very small. No law can get out of a long time and hard work that is required to starting a MEP.
