Majority of 403(b) Providers Use SPARK's Data-Sharing Best Practices

The majority of of 403(b) plan service providers responding to a recent SPARK Institute survey said they are already adhering to, or intend to adhere to, the institute’s best practices.

More than 80% of respondents said they intend to adhere to the newest version of The SPARK Institute’s Data Elements Information Sharing Best Practices (Version 1.04, effective January 1). In addition, more than 60% of respondents said they planned to adhere to The SPARK Institute’s latest best practices for sharing Remittance and Census Data (Version RC 1.0, effective July 1, 2010). (See “SPARK Issues 403(b) Info-Sharing Best Practices for 2010.”)

Of those who said they do not intend to adhere to the Institute’s Best Practices, 46% said it is due to limited technology resources or other priorities. Twenty-three percent cited timing and 15% cited budget limits.

“The Data Elements Best Practices help service providers share information with each other and plan sponsors.  The latest changes to those Best Practices address a number of questions and comments we received from users during 2009,” said Larry Goldbrum, general counsel. Goldbrum also said the new Remittance and Census Data Elements Best Practices were developed because there was a significant need for a standardized way for employers to provide remittance and employee census data to their vendors.

Industry experts say that it is important to have standard formats for 403(b) data-sharing, especially since many 403(b)s have multiple vendors (see “Experts Stress Benefits of Information-Sharing Best Practices”).

The survey was completed between October 14 and November 2 by 42 institutions, including both SPARK Institute member and non-member companies. Copies of the Best Practices documents, as well as complete results of the survey, are available here.

The SPARK Institute is developing guidelines to help employers and vendors of multiple vendor ERISA-covered 403(b) plans gather information for the 2009 Form 5500 requirements. The Institute said it intends to seek comments from non-members regarding the 5500 guidelines.