S4799

An Act concerning electronic delivery of health insurance communications and supplementing P.L.1997, c.192 (C.26:2S-1 et seq.).

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. The Legislature finds and declares that:

a. Advances in secure electronic technology have enabled consumers to access health insurance information more efficiently and conveniently than through traditional paper-based delivery.

b. Electronic delivery of health insurance communications reduces administrative costs, improves timeliness of information, and decreases environmental waste.

c. Numerous states have implemented electronic delivery frameworks for health insurance communications while preserving the ability of consumers to receive paper copies.

d. Consumers should retain the ability to opt out of electronic delivery and receive paper communications when needed.

e. Therefore, it is in the public interest to allow carriers to establish electronic delivery as the default method for certain commercial health insurance communications, while ensuring that covered persons may elect to receive paper communications at no cost.

2. As used in this act:

“Covered person” means an individual on whose behalf an insurer is obligated to pay benefits or provider services pursuant to a health benefits plan.

“Department” means the Department of Banking and Insurance.

“Electronic delivery" means delivery of information by electronic transmittal or electronic posting, including electronic mail, secure internet websites, mobile applications, or other electronic platforms approved by the department.

“Health benefits plan” means a benefits plan which pays hospital, medical, dental, or vision expense benefits for covered services, or prescription drug benefits for covered services, and is delivered or issued for delivery in this State by or through an insurer or any other sponsor. “Health benefits plan” shall not include the following plans, policies or contracts: accident only, credit disability, long-term care, Medicare supplement coverage; TRICARE supplement coverage, coverage for Medicare services pursuant to a contract with the United States government, the State Medicaid program established pursuant to P.L.1968, c.413 (C.30:4D-1 et seq.), coverage arising out of a worker's compensation or similar law, the State Health Benefits Program, the School Employees' Health Benefits Program, or a self-insured health benefits plan governed by the provisions of the federal “Employee Retirement Income Security Act of 1974,” 29 U.S.C. s.1001 et seq., coverage under a policy of private passenger automobile insurance issued pursuant to P.L.1972, c.70 (C.39:6A-1 et seq.), or hospital confinement indemnity coverage.

“Insurer” means an insurance company, health service corporation, hospital service corporation, medical service corporation, health maintenance organization, dental plan organization, dental service corporation, or any other entity authorized to issue health benefits plans in this State.

“Plan communications” means any document, notice, or material related to a health benefits plan that an insurer is required to provide to a covered person pursuant to State or federal law, which may include, but not be limited to policies, certificates of coverage, explanations of benefits, billing statements, notices of adverse benefits determinations, network directories, renewal notices, and health insurance identification cards. “Plan communications” shall not include any document for which electronic delivery is impracticable or otherwise prohibited by law.

“Plan sponsor” means a person, other than a regulated entity, who establishes, adopts, or maintains a health benefits plan that covers residents of this State, including a plan established, adopted, or maintained by an employer or jointly by an employer and one or more employee organizations, an association, a committee, a joint board of trustees, or any similar group of representatives.

3. a. Notwithstanding any law, rule, or regulation to the contrary, an insurer may provide plan communications to covered persons enrolled in a health benefits plan which pays hospital, medical, dental, vision, or prescription drug expense benefits by electronic delivery as the default method of delivery.

b. For a health benefits plan providing hospital, medical, or prescription drug benefits, electronic delivery pursuant to this section may include the electronic delivery of any health insurance identification card required under State law. Nothing in this act shall be construed to require the issuance of a health insurance identification card for a health benefits plan providing dental-only, prescription-only or vision-only coverage if not otherwise required by law.

c. An insurer providing plan communications by electronic delivery as the default method of delivery, pursuant to subsection a. of this section, shall provide paper copies of plan communications to covered persons enrolled in a health benefits plan who opt out of electronic delivery in accordance with section 5 of this act.

4. a. The plan sponsor of a health benefits plan may, on behalf of covered persons in the plan, consent to the:

(1) delivery of the health benefits plan by electronic transmittal or electronic posting;

(2) delivery of plan communications by electronic means; and

(3) electronic delivery of any health insurance identification card required under State law.

b. A plan sponsor’s consent pursuant to subsection a. of this section shall constitute a certification by the plan sponsor that covered persons are reasonably expected to have access to and use electronic communications as a regular part of their employment or plan participation.

5. a. In the initial electronic delivery of a plan communication for a health benefits plan pursuant to subsection a. of section 3 of this act, an insurer shall provide a covered person with an opportunity to opt out of electronic delivery.

b. Pursuant to subsection a. of this section, the insurer shall provide clear and conspicuous notice informing the covered person that:

(1) electronic delivery is the default method of receiving plan communications for health benefits plans pursuant to subsection a. of section 3 of this act;

(2) the covered person has the right to opt out of electronic delivery at any time; and

(3) paper copies of plan communications are available at no cost upon request.

c. A covered person may opt out of electronic delivery or affirmatively elect electronic delivery, as applicable, through electronic, telephonic, or written means.

d. (1) A covered person may elect to receive plan communications by electronic delivery or in paper form. An insurer shall not be required to provide the same plan communication to a covered person in more than one format. An election by a covered person to opt out of electronic delivery shall apply to all plan communications for which electronic delivery would otherwise be the default.

(2) Upon receipt of an opt-out election, an insurer shall provide plan communications in paper form no later than 60 days after receipt of the election.

e. A covered person who has opted out of electronic delivery may subsequently elect to resume electronic delivery.

6. a. Electronic delivery pursuant to this act shall comply with all applicable State and federal laws governing accessibility for individuals with disabilities, cybersecurity, and the privacy and confidentiality of personal and health information.

b. Nothing in this act shall be construed to limit or supersede any obligation imposed under State or federal consumer protection, privacy, or health insurance laws.

7. The Commissioner of Banking and Insurance shall adopt rules and regulations, pursuant to the “Administrative Procedure Act,” P.L.1968, c.410 (C.52:14B-1 et seq.), as necessary to effectuate the purposes of this act.

8. This act shall take effect 180th day next after enactment and shall apply to policies and contracts issued, executed, delivered, or renewed on or after that date.

STATEMENT

This bill establishes electronic delivery as the default method for health insurance communications.

Under the bill, an insurer may provide plan communications to covered persons enrolled in a health benefits plan which pays hospital, medical, dental, vision, or prescription drug expense benefits by electronic delivery as the default method of delivery. For a health benefits plan providing hospital, medical, or prescription drug benefits, the bill also provides for the electronic delivery of any health insurance identification card required under State law.

The bill additionally provides that an insurer must provide a covered person with an opportunity to opt out of electronic delivery. If the insurer chooses electronic delivery as the default method of delivery for plan communications for a health benefits plan, the insurer must provide a covered person with an opportunity to opt out of electronic delivery. The insurer must provide clear and conspicuous notice informing the covered person that:

(1) electronic delivery is the default method of receiving plan communications for health benefits plans;

(2) the covered person has the right to opt out of electronic delivery at any time; and

(3) paper copies of plan communications are available at no cost upon request.

A covered person under the bill may elect to receive plan communications by electronic delivery or in paper form. An insurer will not be required to provide the same plan communication to the covered person in more than one format. An election by the covered person to opt out of electronic delivery will apply to all plan communications for which electronic delivery would otherwise be the default. Upon receipt of an opt-out election, an insurer will provide plan communications to the covered person in paper form no later than 60 days after receipt of the election. Covered persons who have opted out of electronic delivery may subsequently elect to resume electronic delivery.

The bill further permits a plan sponsor, such as an employer, to consent on behalf of covered persons to electronic delivery, provided the plan sponsor confirms that covered persons routinely use electronic communications. Electronic delivery pursuant to this bill will comply with all applicable State and federal laws governing accessibility for individuals with disabilities, cybersecurity, and the privacy and confidentiality of personal and health information. Nothing in this bill will be construed to limit or supersede any obligation imposed under State or federal consumer protection, privacy, or health insurance laws.