The Department of Labor has proposed a rule that would make it easier for group health plans to share mandatory notices with their members electronically. The rule, announced on Wednesday, would allow insurers to post documents online and notify members by text or email when a disclosure is available.
A DOL official called the proposal a big step forward. The Department of Labor estimates that the proposal could save insurers $3.9 billion over a decade by lowering the costs of printing and sending paper disclosures to their members.
Current Process
Many communications, like summary plan descriptions, claims denials, or notices that coverage can continue after a job loss, are currently sent via physical mail. Group health plans print and mail up to 11 billion sheets of paper each year, regulators said.
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Daniel Aronowitz, who leads the DOL’s Employee Benefits Security Administration, said during a press briefing that the proposal is a big step forward in how Americans receive important information about their health benefits.
Benefits of E-Delivery
Moving to e-delivery will be more convenient and secure for beneficiaries, according to DOL. People can still request to receive their disclosures physically if they prefer. Aronowitz said the proposal is a win for participants and beneficiaries, a win for employers, a win for efficiency.
Electronic delivery rules under the Employee Retirement Income Security Act haven’t been modernized since 2002. Currently, only individuals considered “wired at work” — with access to a computer and email address provided by their employer — or who provide affirmative consent can get their disclosures digitally.
Expansion of E-Delivery
The proposed rule would create a new safe harbor for group health plans to use electronic media — like email or web portals — to send documents to members. They don’t have firm estimates of how many working Americans who aren’t currently benefiting from e-delivery will under the proposed rule.
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However, the regulation would apply to more than 134 million participants in 2.7 million ERISA-covered plans nationwide, according to regulators. It’s part of the Department of Labor’s larger push to ensure plan notice requirements are up to date.
In 2020, the department modernized electronic delivery rules for retirement plans. The healthcare industry has been moving towards greater electronic interchange of information, spurred by federal regulators as Americans increasingly live, play, and work online.
Insurers have also worked to expand consumers’ electronic and app-based data access, with the goal of making it easier for Americans to review claims, find in-network providers, view digital insurance cards, chat with member support, and more online.
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