We're making it easier for prospective members to apply for coverage over the Internet. When we receive an application over the Internet, the applicant's signature is electronic. That means when we print out the application, we simply get a "typed" version of the signature. You may see a digital signature when we request medical records from you — either as part of the application process or later, when we are processing and paying claims.

As people get used to buying items and services over the Web, we think electronic applications will become more common. We welcome this change because it ensures that applications are complete. It also helps us avoid potential errors when we transfer data from a paper application into our system.

In the future, when we request medical records for an application we received electronically, we will advise you of this in our request for records. The request will be worded similarly to this:

Your patient has applied for individual health insurance coverage through a secure transaction over the Internet. During this process, the patient's signature was captured using methods that meet the standards of the Federal Electronic Commerce Act, 15 U.S.C. § 7001, which provides that an electronic signature is to be given the same force and effect as a "written" signature. The South Carolina Legislature has also authorized the use of electronic signatures. See South Carolina Code § 26-5-320 (1998). The signature on the attached Authorization and Agreements form is an e-signature with the same legal authority as a hand-written signature under both state and federal law. Please accept your patient's e-signature as if it were an original hand-written signature.

Understandably, some healthcare professionals are concerned whether this signature provides a sufficient authorization to forward a person's medical records to the person or company requesting those records. At the end of this bulletin, we have included very brief excerpts from the federal and state laws directing that electronic signatures are to be accepted just as you would accept a written signature. If you want more information or the full text of these laws (found in the United States Code of Laws and the South Carolina Code of Laws), you can get them from most libraries or the Internet.

These concerns may increase as we get closer to April 14, 2003 — the date we are required to comply with the HIPAA standards for privacy. Please be assured that we are committed to being fully compliant with all areas of the HIPAA privacy law. Notably, the requirements for electronic signatures are not in conflict with the HIPAA standards.

We appreciate your cooperation in helping us serve our customers and your patients through more convenient and easy methods such as the Web. 
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ELECTRONIC SIGNATURES IN GLOBAL AND NATIONAL COMMERCE

15 U.S.C. Sec. 7001

Sec. 7001. General rule of validity (a) In general

Notwithstanding any statute, regulation, or other rule of law (other than this subchapter and subchapter II of this chapter), with respect to any transaction in or affecting interstate or foreign commerce –

(1) a signature, contract, or other record relating to such transaction may not be denied legal effect, validity, or enforceability solely because it is in electronic form; and<<br /> (2) a contract relating to such transaction may not be denied legal effect, validity, or enforceability solely because an electronic signature or electronic record was used in its formation.


SOUTH CAROLINA ELECTRONIC COMMERCE ACT

SECTION 26-5-30. Definitions.>

(4) "Electronic signature" means any identifier or authentication technique attached to or logically associated with an electronic record that is intended by the party using it to have the same force and effect as a manual signature.

SECTION 26-5-310. Enforceability of electronic records.

A record may not be denied legal effect, validity, or enforceability solely because it is in the form of an electronic record or signature.

SECTION 26-5-320. Application of section to laws requiring written records; exceptions.

(A) An electronic record satisfies any rule of law requiring a record to be in writing or providing consequences if it is not in writing.