Feds Delay Electronic Transaction Operating Rules Enforcement

Centers for Medicare and Medicaid Services gives the healthcare industry three additional months to implement the HIPAA 5010 transaction set.

Ken Terry, Contributor

January 7, 2013

4 Min Read

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The Centers for Medicare and Medicaid Services (CMS) has postponed enforcement of new operating rules regarding the electronic exchange of information about insurance eligibility and claims status until March 31. HIPAA-covered entities -- including payers, providers and clearinghouses -- were required to implement these operating rules by Jan. 1, 2013, but CMS took this step to avoid "significant disruption to the healthcare industry," according to an agency announcement.

"Industry feedback suggests that HIPAA-covered entities have not reached a threshold whereby a majority of covered entities would be able to be in compliance with the operating rules by January 1, 2013," CMS said.

CMS announced the interim final rule on these two sets of operating rules -- which are authorized by the Affordable Care Act -- in July 2011 and codified them six months later. The agency released other operating rules for electronic funds transfer and electronic remittance advice early in 2012; those rules must be implemented by Jan. 1, 2014. A third group of these requirements, including one for claims attachments, is scheduled to go into effect Jan. 1, 2016.

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The operating rules and policies have been developed by the Committee on Operating Rules for Information Exchange (CORE), part of the Council on Quality Affordable Healthcare (CAQH). Established in 2005, CAQH CORE is a collaboration of more than 130 organizations, including providers, health plans, vendors, government agencies and standard-setting bodies. CORE participants include health plans representing more than 75% of commercially insured people, plus Medicare and Medicaid beneficiaries.

The operating rules are needed because the recently implemented HIPAA 5010 transaction set, like its 4010 predecessor, covers only the formatting of administrative transactions, not their content. Because every payer has different systems and different requirements for exchanging information with providers, clearinghouses have stepped in to make sure that every transaction includes the requisite elements for each payer.

So, even though the 5010 transaction set had to be implemented by last July (after six months of delays), these transactions still involve some reworking and secondary processing of data that reduces administrative efficiency, noted Doug Hires, executive VP of Santa Rosa Consulting, in an interview with InformationWeek Healthcare.

Asked why it has taken providers and plans so long to gear up for the eligibility and claims status operating rules, Hires speculated that it might have to do with the lack of standardization of systems and data content.

"If there are empty fields because there's no data present, [HIPAA covered entities] are still compliant with the X.12 5010 transmission," he noted. "So this delay is not necessarily about the 5010 transaction not being implemented; perhaps they're still missing the data."

The implementation of 5010 in 2012 and the transition to ICD-10 this year have taken a lot of effort, but have not necessarily diverted attention from the CORE operating rules, Hires said. "I don't know that it distracted so much as there was a continued underestimation of the resources that would be required." The same has been true in other areas of health IT. Despite the postponement of the ICD-10 deadline to October 2014 -- a full year later than the initial date -- some of Santa Rosa Consulting's clients are still "scrambling to get caught up on ICD-10," he added.

Overall, he continued, the Affordable Care Act and the HITECH Act have required "a tremendous amount of change for organizations," both in the technical area and also in user training and workflow.

It's unclear whether the 90-day delay in enforcement of the operating policies for eligibility and claims status will be enough, he said. But CMS's move puts the January 2014 implementation of operating rules for electronic funds transfer and electronic remittance advice "at risk," he noted.

On the other hand, he said, "there's a tremendous opportunity" to reduce administrative costs once these operating rules are in place across the industry. Just from implementing the eligibility and claims status rules alone, the ACA estimates that over the next 10 years providers will save up to $9.5 billion and payers will save up to $5.8 billion.

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About the Author(s)

Ken Terry


Ken Terry is a freelance healthcare writer, specializing in health IT. A former technology editor of Medical Economics Magazine, he is also the author of the book Rx For Healthcare Reform.

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