There are a few issues raised by the need to comply with both the statutory provision and the regulation governing the production of documents in response to participant requests: Who is required to produce what, when, and who is the entity liable for damages? ERISA Section 104(b)(4), 29 U.S.C. § 1024(b)(4) requires that a plan administrator furnish a copy of “the latest updated summary plan description . . . and the latest annual report, any terminal report, . . . trust agreement, contract, or other instruments under which the plan is established or operated.” Under 29 C.F.R. Section 2560.503-1, an administrator must provide a claimant all documents, records, and other information relevant to the claimant’s claim for benefits. Under Section 104(b)(4), it is clear that if the plan administrator does not produce what he or she is required to produce within 30 days of the written request, then–depending on the jurisdiction–the administrator is subject to ERISA Section 502(c), 29 U.S.C. § 1132(c) penalties. Documents required to be produced under Section 104(b)(4) can be very different from the documents required to be produced under the regulation. While there are some crossovers, it may not be totally clear to participants what they are entitled to under Section 104(b)(4) versus under the regulation, and when. So, for example, under Section 104(b)(4), there is a specific time period within which the administrator must provide the documents: thirty days from receipt of the written request. However, there is no time period under the regulations.
There’s also an issue with respect to who is responsible under the regulations for sending the documents to the participant. The regulation does not specify who is considered the “administrator:” the claims administrator or the plan administrator. In addition, while most jurisdictions have determined that a violation of the regulation does not warrant statutory penalties under Section 502(c), one district court found that a violation of the regulation required the imposition of statutory penalties.
Another issue is whether a plan administrator must produce a document under ERISA Section 104(b)(4) that is not in its possession. In many cases, the claims administrator is handling the claims review. So if there is a document in the claims record that the plan is operated under, the plan administrator is responsible for producing that document. However, if the document is in the possession of the claims administrator, or another third party, that creates a potential problem. How does the plan administrator obtain those documents, especially if the claims administrator or third party claims the documents are confidential and proprietary? Some courts have said that the plan administrator still has to obtain those documents from the claims administrator or third-party and produce them to the participant.30
At this point, decisions regarding what documents are covered under Section 104(b)(4) and when penalties should be awarded are different based on what jurisdiction you are in. The document production requirements under the regulations add additional issues that each jurisdiction will deal with differently. For example, an administrator may have to turn over a document in one jurisdiction but not in another. Additional decisions on these document production issues will be very helpful. Another potential helpful solution would be a clarification of the regulations. A plan administrator must be very aware of the law in the different jurisdictions it operates in, because the law on document production under both ERISA Section 104(b)(4) and the regulations may vary.
A plan administrator should also be aware of the claims regulations and the law under the claims regulations, especially in terms of making sure the plan’s procedures incorporate what the claims regulations specify needs to be done.