Safe Harbor Electronic Communications
How much money is your plan wasting on unnecessary paper communications?
Prior to 2002, multiemployer plans were not able to take advantage of the proposed safe harbor for electronic communications. The proposed rules required that employees be able to access and print plan communications at their workplace and at the employer's expense. In 2002, the final rules afforded multiemployer plans an extension to this safe harbor which in short, allows any participant with internet access to opt-in.
Add up your plan's printing and postage budget. Be sure to include an annual rate for SPDs, Newsletters, SARs, EOBs, COBRA Notices, and all other printed communications. Now for a rough estimate of how much money your plan is leaving on the table, assume 10% of participants opt-in in the first year, another 10% in the second, and so on until you reach an assumed maximum participations rate. Wow! Every month you delay means more money unnecessarily spent.
With a web site, the plan makes available plan information to participants on a 24/7 basis. But, this does not satisfy the requirements for safe harbor communications. The safe harbor requires in addition to the "opt-in" a reasonable assurance that the participant actually has received the communication. We call this a "push" method, as opposed to the "pull" method a participant uses when, unprompted they access the plan's web site.
This product has two levels of implementation. The first is for general plan communications, and has low security requirements. The second is for personal information and has the same high security and confidentiality requirements.
Level I -- General Plan Information
- SPD
- SAR
- SMM
- Newsletters
- Announcements
Level II -- Personal Plan Communications
- Pension Benefit Statements
- Explanation of Benefits
- COBRA Notices
- W2/1099-R
- Student Status Request
Narrative
The Electronic Communications program is part of the ongoing effort of the plan to make it easier and faster for participants to get important plan information. In addition, by using electronic communications, there is a substantial reduction of the costs associated with paper/U.S. Mail communications. Together, this effort results in a higher level of service to plan participants.
The first requirement for electronic communications plan is the creation and deployment of a static web site. The next phase is a combined utilization of email and the web site. The final phase is to offer secure, encrypted electronic access to personal benefit statements and information. Participation in the program is voluntary. Unless a participant opts in, he will continue to receive all communications from the plan via printed material sent by U.S. Mail.
How it Works
Level I: All participants will be sent an "activation key" via U.S. Mail. After receiving the activation key, the participant will need to go to the Plan web site and go to the electronic communication activation page. There he will be asked to input the activation key and email address. The page will also ask for the last four digits of his Social Security number and the his date of birth. When these items match the information on file, the email address will be registered and the participant will be set up for future electronic communications.
From then on he will receive an email whenever a general communication is prepared by the plan such as a Summary Plan Description, notice of changes in the benefit programs, or Summary Annual Report. The email will explain the purpose and importance of the communication and provide the participant with links to the document and/or web pages on the site which contain the communication.
Important Notes
- No personal information will be made available on the Internet.
- Participation is completely voluntary, if the participant decides he doesn't like getting communications this way, he can opt out at any time.
- If the participant chooses to participate in the program, he can still request a paper copy of any specific communication from the Plan.
Level II: This adds the requirement for a secure user name/password system. If one is already in place or is developed for this and other self-service functions, then secure access to personal benefit statements, EOBs, etc. is added to Level I. The functionality is identical, with the exception that the participant will be prompted for a new user name/password when clicking on the email link.