IMPLEMENTING THE HIPAA TRANSACTIONS AND CODE SETS

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IMPLEMENTING THE HIPAA TRANSACTIONS AND CODE SETS

• Presentation to the
• Coalition of Voluntary
• Mental Health Agencies
• April 30, 2002

Prepared By Robert Belfort Kalkines, Arky, Zall
Bernstein LLP 1675 Broadway, Suite 2700 New
York, New York 10019 [phone] rbelfort_at_kazb.
com
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WHAT DO THE RULES MANDATE?

• Covered entitiesconducting any of theHIPAA
  transactions electronicallymust use
  standardizedformats and codes.

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WHAT ARE THE HIPAA TRANSACTIONS?

• Claims submission or encounter data
• Verification of health plan eligibility
• Pre-certification and authorization of referrals
• Claims status
• Claims payment and remittance advice
• Coordination of benefits
• Plan enrollment and disenrollment
• Premium payments

Health plans only
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TRANSACTION FLOW CHART

• Claim submission
• Claim payment
• Claim status inquiry
• Claim status response
• Request for authorization
• Approval or denial
• Eligibility inquiry
• Eligibility response

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ANSI TRANSACTION FORMATS

• Claim submission ANSI X12N 837
• Claim payment 835
• Claim status inquiry 276
• Claim status response 277
• Request for referral/pre-authorization 278
• Response to referral/pre-authorization
  request 278
• Eligibility inquiry 270
• Eligibility response 271

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MEDICAL CODE SETS
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STATUS OF IDENTIFIERS
Date Date Rule Proposed Finalized Comments P
rovider Identifier November 3, 1999 Final rule
delayed due to lack of funding Employer
Identifier June 16, 1998 Final rule
pending Health Plan Identifier Rule under
development Patient Identifier Suspended due
to privacy concerns
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MODIFICATION OF STANDARDS

• New versions
• Modifications by DSMOs
• 180-day notice period

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KEY ELEMENTS OF TRANSACTION RULES

• Cannot use non-standard format even if both
  parties agree
• No local codes
• Maximum data set
• Compliance by business associates
• No cost or time impediments
• Non-electronic transactions still permitted

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ARE YOU A HEALTH CARE PROVIDER?

• A provider under Section 1861(s) or (u) of the
  Social Security Act
• Any other person or organization who furnishes,
  bills or is paid for health care in the normal
  course of business
• Health care means care, counseling, service,
  assessment or procedures related to the physical
  or mental condition or functional status of an
  individual - includes case management

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DO YOU CONDUCT ELECTRONIC TRANSACTIONS?
Electronic
Non-Electronic Internet Fax Extrane
t Telephone Leased lines Mail Dial-up
lines Private networks Tape or disk Direct
data entry Telephone voice response
Standard content required but not standard
format
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CAN YOU AVOID ELECTRONIC TRANSACTIONS?

• Increased labor costs
• Claims payment lag
• Demands by payors
• Medicare electronic billing requirement

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MEDICARE ELECTRONIC BILLING REQUIREMENT

• Effective October 16, 2003
• Exception for small providers
• facilities
• other providers

25 FTEs
10 FTEs
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PENALTIES FOR NON-COMPLIANCE

• 100 per violation
• 25,000 per year cap per violation
• You wont get paid!!

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COMPLIANCE DATE

• October 16, 2002
• ASCA delay until October 16, 2003

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KEY FEATURES OF ASCA

• Option to delay to October 16, 2003
• Must file compliance plan by October 15, 2002
• Must begin testing by April 16, 2003
• Medicare exclusion penalty

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ELEMENTS OF ASCA COMPLIANCE PLAN

• Description of covered entity
• Reason for extension
• Implementation budget
• Submission options
• Electronic form at www.cms.gov/hipaa/hipaa2/ascafo
  rm.asp

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SHOULD YOU FILE FOR AN EXTENSION?

• Status of your remediation efforts
• Readiness of your software or billing vendor
• Readiness of your trading partners
• Medicare and Medicaid seeking extension

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FIVE STAGES OF HIPAA COMPLIANCE(Theoretical)

• Education
• Gap analysis
• Remediation
• Testing
• Training

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FIVE STAGES OF HIPAA COMPLIANCE(Actual)

• Denial
• Anger
• Grief
• Acceptance
• Hope

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BUILDING THE COMPLIANCE TEAM

• Oversight by senior management
• Coordination by CIO or IT staff
• Participation by affected departments
• Scheduling
• Registration
• Coding
• Clinical
• Billing
• Accounts receivable

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ESTABLISING A COMPLIANCE TIMELINE
April 2002 December 2002 April, 2003 October 2003
Education Gap Analysis Remediation Testing Tra
ining
248191
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PERFORMING A GAP ANALYSIS
High Moderate Low
Internal Staff
STAFFRESOURCES
Commercial Self-Assessment Tool
On-Site Consultant
Low Moderate High COST
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DEFINING THE SCOPE OF COMPLIANCE

• Which transactions do you conduct electronically
  now?
• Which transactions would you like to conduct
  electronically in the future?
• Priority considerations
• continuity
• complexity
• ROI
• vendor readiness
• partner readiness

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GAP ANALYSIS OF CLAIMS SUBMISSION

• Download ANSI implementation guide at
  www.wpc-edi.com
• Prepare HCFA 1500-ANSI 837 crosswalk (see
  afehct.org/aspire.asp)
• Compare data elements and codes

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FORMAT GAPS VS. CONTENT GAPS

• Format Gaps Content Gaps
• Coding changes Missing data elements
• Different field sizes
• Different syntax
• Remedied by change Remedied by change in business
• in technology processes/data capture

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CURRENT ELECTRONIC BILLING MECHANISM

• Billing company/clearinghouse
• Commercial software package
• Home grown system

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QUESTIONS FOR SOFTWARE VENDORS

• Will HIPAA-complaint upgrade be issued?
• What is timetable?
• Is there a cost?
• Will it be tested before distribution?
• Will it be certified by a third party?
• What training and support will be provided?
• How will further upgrades be handled?

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SELECTING A NEW SOFTWARE VENDOR

• Size and financial stability of company
• Portion of revenues from health care industry
• Level of HIPAA compliance resources
• Status of HIPAA compliance efforts
• Contractual commitment to future upgrades

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BILLING COMPANY ISSUES

• Will the billing company function as a
  clearinghouse or subcontract out this function?
• Who is in charge of HIPAA compliance?
• When will the company be HIPAA compliant?
• When will the company be ready to test?
• Has the company discussed testing with payors?
• Will the company seek third party certification
  of compliance?

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OTHER TRANSACTIONS

• Medicaid upgrading EMEVS in 2003
• Some HMOs using Internet-based systems
• Significant ROI potential

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SYSTEM REMEDIATION OPTIONS
Remediation Option Pros
Cons Reprogramming ? Maintains system
simplicity ? High up-front costs ? Maximum
organizational control ? Need for ongoing
revisions ? No per transaction fees Translator
Software ? Lower up-front costs ? Adds
complexity to system ? Vendor responsible for
? Reliance on vendor for future upgrades
future upgrades ? No per transaction
fees Clearinghouse ? No up-front costs ? Per
transaction fees ? Vendor responsibility ?
Maximum reliance on outside for compliance
and upgrades entity
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COORDINATION AND TESTING

• Prepare list of trading partners
• Obtain HIPAA compliance status report and
  timeline
• Monitor compliance with timeline
• Test transactions (April 16, 2003 ASCA target)
• Execute trading partner agreements

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TRADING PARTNER AGREEMENTS
Yes
No

• Change definition, data condition or use of data
• Add data elements or segments to maximum defined
  data set
• Use any code or data elements marked not used
• Change meaning or intent of implementation
  specifications

• Mechanism for connectivity
• Responsibility for telecommunication costs
• Use of codes not yet specified
• Size limitations on batch transactions

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NYS MEDICAID TIMELINE
Late 2002 Spring 2003 Late 2003/Early
2004?? 2005??
In-house testing External Testing Upgrade of
PACES Direct electronic interface
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EMPLOYEE TRAINING

• Data capture
• Data processing

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HELPFUL WEB SITES

• http//aspe.hhs.gov/admnsimp
• www.wpc-edi.com/hipaa
• www.wedi.org
• www.afehct.org
• www.ahima.org

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