Medicare Electronic Submissions System Makes Slow Start

Medicare auditors received electronic attachments of only 85,000 medical records through the Electronic Submission of Medical Documentation (esMD) system in the program's first year, which ended Sept. 15, 2012.

Meanwhile, the Centers for Medicare and Medicaid Services (CMS) has still not implemented standards that would allow physicians and hospitals to send electronic claims attachments to commercial payers that request them to support claims.

Under the esMD system, providers can send medical documentation to review contractors -- including recovery audit contractors (RACs) -- electronically through the CONNECT software developed by the Office of the National Coordinator for Health IT (ONC) for the Nationwide Health Information Network Exchange. To do so, they may either build their own interface to the CMS esMD gateway or contract with a CMS-certified intermediary known as a health information handler (HIH).

As of September 2012, CMS announced, 1,778 Medicare providers (hospitals, physicians, medical equipment suppliers, etc.) were using esMD to respond to medical record request letters they received from review contractors. Sixteen HIHs had been certified by CMS, and 21 review contractors had been approved to accept medical records via esMD.

Twenty of the latter firms are Medicare review contractors and one is a Medicaid contractor. All four of Medicare's recovery audit contractors (RACs) can accept electronic document attachments.

In CMS's announcement, it stated, "Healthcare providers, health information handlers and Medicare review contractors believe that using the esMD system results in cost savings and increased efficiencies."

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Nevertheless, only 5.5% of the records requested by the Medicare auditors during the first program year went through esMD. CMS told InformationWeek Healthcare that it was still satisfied with the program's success to date because esMD had only two HIHs with a "handful of providers" at the outset, and it now has many more.

The most obvious reason for the relatively low rate of esMD utilization is that CMS doesn't require practices or hospitals to use esMD for claims attachments. Providers are still free to send them by fax or snail mail.

Another possible explanation, said Ron Sterling, a health IT consultant based in Silver Spring, Md., is that the penetration level of electronic health records is still not high. The latest CMS figures on EHRs, he noted, show that fewer than a third of doctors have attested to Meaningful Use. And if an auditor requested records going back a year or two, the practice or hospital might not have had an EHR then, even if it has one now.

In addition, Sterling told InformationWeek Healthcare, few EHRs can be used to generate electronic document attachments. If a payer just asked for an office visit note, it wouldn't be difficult, he said. But if the provider had to pull information from other places in the record, that could be problematic.

EHR vendors have not been eager to build in this capability, he said, because providers haven't been demanding it. "The industry has had enough trouble digesting stage 1 and stage 2 of Meaningful Use, so it's probably on a back burner."

All of this suggests why the government has not been in a hurry to require the use of document attachment standards in the HIPAA administrative transaction set, which governs electronic transactions between providers and payers. Document attachment standards were mandated by the original 1996 HIPAA law, Sterling said, and have been available since 2000.

"If the government said this was required, people would figure out how to make it work. But not many practices could support claims attachments easily."

The Department of Health and Human Services, which includes CMS, recently issued an interim final rule that prescribes operating standards -- rulebooks for implementing electronic transactions -- for electronic remittance advice and electronic funds transfer. The Patient Protection and Affordable Care Act requires the issuance of these standards -- as well as those for electronic claims attachments -- by 2016, and HHS says that attachments are on its road map.

But, if and when they're required, they might not save a lot of money, Sterling said, because of the difficulty of collecting the requested information.

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