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Health Insurance Portability andAccountability Act of 1996 (HIPAA)
Public Law 104-191
Advance Implementation Strategies
Gary BeattyPresidentEC [email protected]
– 9 EDI Transactions– Code Sets– Identifiers– Security / Privacy
Session Topics
• Back to the basics
• Implementation Strategies• Break• Financial EDI
• EDI Acknowledgements• HIPAA IG Change Request Process
Is EDI Important?
“HIPAA sets a precedent in the health care industry byaugmenting the clinical exchange of data between theproviders, payer, and sponsors. While HIPAAincreases efficiency and accuracy of transactions, it isimperative for those organizations that fall under theumbrella of this mandate to be poised for compliance.”
- Gary A. Beatty
Chair, ASC X12 Insurance Subcommittee
PROVIDERS INSURANCE AND PAYERS SPONSORS
Eligibility Verification
Service Billing/Claim Submission
AccountsReceivable
Enrollment
Claim Acceptance
Accounts Payable
Enrollment
Claim Status Inquiries Adjudication
Pretreatment Authorization and Referrals
Precertificationand
Adjudication
Enrollment
Payment Order
Elig. Inquiry
Elig.Response
Health CareServicesDelivery
Claim
Patient Info.
Claim Status Inq.
Patient Info.
Claim Status Rsp
ClaimPayment
Limitations & Concerns• Timing• Accuracy• Handling• Reconciliation• Storage
OPTIONS
ANSI X12EDIFACT
EDI ISComputer to Computer
or Application to Application
or
Company to CompanyorDepartment to Department
Electronic Exchange ofBusiness Documents
Business DataInformation(without human interface)
Using a Public Standard Formats
EDI
A REAL WORLDDEFINITION
EDI is theelectronicexchange offrequentrepetitive “dirty”documents
INDUSTRIES
TransportationFinance
ElectronicsRetail
GovernmentAutomotive
Healthcare
COMPONENTS of EDI² STANDARDS
² COMMUNICATION
² SOFTWARE/HARDWARE
ANSI ASC X12
UN/EDIFACT
CommunicationsSubmitter
Receiver
Value Added NetworksClearinghouses
Direct
CommunicationsValue Added Networks
Provider
Provider
VAN
Provider
Payer
Payer
Payer
VANVAN
VAN
VAN VAN
VAN VAN
Payer
CommunicationsClearinghouses
Provider
Provider
Provider
Provider
Provider
Payer
Payer
Payer
Payer
Payer
Clearinghouse
Clearinghouse
CommunicationsDirect
Submitter
Receiver
DIRECT
§ Physical Media (Tape, diskette, CD-Rom)
§ Bulletin Board Systems
§ Modem to Modem
§ Intranet / Internet
ü Encryption
ü Authentication
ü Non-Repudiation
ü Data Integrity
SOFTWARE / HARDWARE
Mapping
StandardsSecurity
Communications
Quality Control
Enrollment
AccountsReceivable
ManagedCare Claims
Adjudication
AccountsPayable
Purchasing
Tactical – Reduced Direct and Overhead Costs
v Improve Accuracy (5% data entry errors)
vReduced Data Entry Time
vSmaller/Faster Transmissions at Lower Cost
vReduce/Eliminate ReworkvAvoid/Reduced Data Entry FTE
vReduce Operational Costs (office supplies,postal costs, and telephone charges)
vReduce the Accounts Receivable Cycle
BENEFITS OF EDI
Strategic – Improve Process that directlyimpacts healthcare stakeholdersØ Improved patient, provider, and payer supportØ Efficient information delivery
Ø Improved quality
Ø Fosters “Good Will” with patients
Ø Fosters closer working relationship betweenorganizations
BENEFITS OF EDI
BENEFITS OF EDICultural – Creating a Competitive Advantage
q Increase responsiveness between healthcarestakeholders
q Penetration of new marketsq Easier to do business withq Improved relations with other organizations
HIPAA¥ Purpose¥ Who¥ What¥ When
K2
Purposes ofProvisions
Ø Improve efficiency andeffectiveness of health caresystem by standardizing theelectronic exchange ofadministrative and financialdata.
Ø Protect security and privacyof transmitted information.
Requirements for Adoption of Standards• Applicability
– Health plans
– Health care clearinghouses
– Health care providers who transmit anyinformation in an electronic form.
• Standards must be developed by anAccredited Standards Committee ofthe American National StandardsInstitute.
X12HL7 NCPDP
PROVIDERS INSURANCE AND PAYERS SPONSORS
Eligibility Verification
Service Billing/Claim Submission
AccountsReceivable
Enrollment
Claim Acceptance
Accounts Payable
Enrollment
Claim Status Inquiries Adjudication
Pretreatment Authorization and Referrals
Precertificationand
Adjudication
834
820
270
271
278
837
275
276
275
277
835
ANSI ASC X12 STANDARDS
v Enrollment and disenrollment in a health plan.4 Benefit Enrollment and Maintenance (834)
v Health Plan premium payments.4 Payment Order/Remittance Advice (820)
Enrollment Enrollment
834
820
INSURANCE AND PAYERS SPONSORS
ANSI ASC X12 STANDARDS
v Eligibility for a health plan.4 Health Care Eligibility / Benefit Inquiry (270)4 Health Care Eligibility / Benefit Information (271)
v Referral, certification and authorization.4 Health Care Service Review Information (278)
PROVIDERS INSURANCE AND PAYERS
Eligibility Verification
Enrollment
Pretreatment Authorization and Referrals
Precertificationand
Adjudication
270
271
278
ANSI ASC X12 STANDARDS
v Health claims or equivalent encounter information.4 Health Care Claim (837)
v Health claim attachments.4 Patient Information (275)
v Health claim status.4 Health Care Claim Status Request (276)4 Health Care Claim Status Notification (277)
v Health care payment and remittance advice.4 Health Care Claim Payment/Advice (835)
Service Billing/Claim Submission
AccountsReceivable
Claim Acceptance
Accounts Payable
Claim Status Inquiries Adjudication
837275276275277
835
PROVIDERS INSURANCE AND PAYERS
Standards Implementation Guide
Mandatory
Optional
Required
Situational
Not Used
STANDARDS VERSUSIMPLEMENTATION GUIDES
Washington PublishingCompany800-972-4334http://www.wpc-edi.com
Establish standards for code sets– Developed by private and public
entities.• CPT4• ICD-9-CM• HCPCS• CDT• NDC (11 digits)
– Internal Codes• X12• NCPDP• HL7
CODE SETS
Level 1 – CPT4
Level 2 – Alpha Codes
Level 3 – Local Codes
Dental Codes (D)
J Codes
UNIQUE HEALTH IDENTIFIERS• Employers
– Federal Tax Identifier - IRS
• Health Plans – HCFA?– Plan ID (3 Levels)
• Payers & Administrators
• ERISA Group Health Plans, Taft-Hartley Trusts, METs
• PPOs & Similar Organizations
• Health Care Providers– National Provider Identifier
• Organizational NPI• Individual NPI
• Individuals - Unknown!
Security / Privacy• Privacy
– Administrative Procedures– Physical Safeguards– Technical Security Services– Data Transmission Security– Electronic Signature
• Security– Encryption– Authentication– Non-Repudiation– Data Integrity Verification
Implementation Alternatives
Standard
Standard
HTMLJAVAXML
Proprietary
WEB
Server
Proprietary
Client
Standard
Standard
Clearinghouse
representing
Provider/Sponsor
Proprietary or Standard
SameClearinghouseRepresenting Both Parties
ProprietaryProprietary
Clearinghouserepresenting
Payer
Proprietary or Standard
Provider Payer
Provider Payer
EDISoftware
FROM(FF) TO(X12)
V TP
VAN1
AccountsReceivable Accounts
Payable
FROM(X12) TO(FF)
VAN2
997
LOG---
EDISoftware
PENALTY FOR NON-COMPLIANCE
• $100.00 For each violation
• Maximum of $25,000.00 penalty per year
– Identical requirement
– Prohibition
• Each offense– Fined not more than $50,000– Imprisoned not more than 1 yr.
• False pretenses– Fined not more than $100,000– Imprisoned not more than 5 yr.
• Intent to sell, transfer, or use– Fined not more than $250,000– Imprisoned not more than 10 yr.
Wrongful Disclosure
Implementation ProcessFace the Facts
•Will HIPAA Happen?
•What will the final requirements be?•Delays – Delays - Delays
Senate Bill 836
House Rule 1975
Other Legal Challenges
Getting Organizational Buy In
•Requires Top Down Management Support
•ROI is Real
•Cost is Real ⇒⇒ Investment
•Opportunity for Re-engineering
•Overcome Internal Politics
•HIPAA will impact all aspects of Health Care
Aligning HIPAA Strategies
Corporate Strategy
IT / Web Strategy
HIPAA Strategy
HIPAA Compliance
HIPAA
REQUIREMENTS
Transactions Identifiers Codes Privacy
HIPAA RequirementsNot all black and white
HIPAA Assessments – Identify/Leverage Options
Participate – X12N, WEDI, AFEHCT, Others….
Your HIPAA TeamWho needs to be involved
• Business / Administrative Staff– Management Support– Line(s) of Business Staff– Quality Control / Audit– Legal– Human Resources
• Technical Staff– EDI Analyst/Programmers– Network Support– Security– System Operations
EDI Resources / Education• Skil l Set Requirements
– Health Care Knowledge
– EDI Knowledge
• Resources with Both are very Scarce
– Find people with healthcare knowledge
– Training
• EDI Basic
• EDI Tools
Responding toConsumerism in Healthcare
• Our product is HIPAACompliant!
• Mergers / Acquisitions/ Consolidation
• Business Partners
BREAK
Introduction toFinancial EDI
Objectives
ó EDI versus EFT versus FEDIó Paper-based transactionsó Basics of f inancial EDI and EFT mechanismsó Handling examplesó Financial EDI issues
DEFINITIONS
~Application to Application~Business Data~Structured Format
EDI
Electronic ExchangePayment DataValue Transfer
DEFINITIONS
EFT
¹ Timing of Transferó Direction of Transfer$ Cost of Transfer
ü Confirmation
O Verification
Issues to Consider
� Application to Application� Financial Data - Value� Structure Format
DEFINITIONS
FEDI
PAPER-BASED TRANSACTIONS
PAYER/BUYER
PROVIDER/SELLER
CHECKWITHREMITTANCEADVICE
CLAIM/INVOICE
PAPER vs. EFTin VALUE TRANSFER
PAYER’SBANK
PAYMENTINFORMATIONREMITTANCE
PAYROLL
PAYERBuyerPayer
Employer
PAYEESeller
ProviderEmployee
PAYEE’SBANK
VALUE
FED WIREEFT Mechanisms
~ Same-day Availability~ Confirmation~ Limited Data~ Clearing thru Fed~ High Cost
ACHEFT Mechanisms
� Usually Batch Mode� 1-2 Days Delay� Additional Data Format Dependent� Clearing thru Fed� Low Cost
COMMONACH FORMATS
94 Character Records
CCD No Ancillary RecordsCCD+ One Ancillary RecordCTX 820/835 ANSI X12 Syntax
TABLE
#1
#2
820 835
ABC Insurance123 South Main St.Minneapolis MN 55402
67452October 16, 2002
Pay to__Joe’s Office Products________________$_472.48Four Hundred Seventy Two and 72/100__________Dollars
Southfield Bank & Trust
F r e d H S m i t h67452123456789123456789I :: I :: 12312341231234II.
Invoice 18726 July 29, 2001 $230.40Prepay Discount $(23.04)Invoice 19746 August 1, 2001 $265.12Total $472.48
ABC Insurance123 South Main St.Minneapolis MN 55402
67451October 16, 2002
Pay to__Front Street Clinic ________________$_60.00Sixty and 00/100 __________Dollars
Southfield Bank & Trust
F r e d H S m i t h67451123456789123456789I :: I :: 12312341231234II .
Claim 18726 July 29, 2001 $100.00Patient Deductible $(20.00)Office Visit Co-Pay $(10.00)Office Visit Co-Pay $(10.00)
820835
ü Remittance adviceü Payment orderü Combination remittance advice & payment orderü Payment instructions to financial institution
EDICTX
820835
820835
Examples of FinancialPaths
»Value & Data Together»Value & Data Separate»Value & Data Separate thru Bank
Network
VAN1
ANSI820835
EXAMPLE #1: VALUE & DATA TOGETHER
BUYER/PAYER
SELLER/PROVIDER
ANSI820835
VAN1
BUYER/PAYER BANK
SELLER/PROVIDER BANK
REMITTANCE ADVICE
ACH $$CTX$$820/835
$$CTX$$820/835
Advantages
q Automated cash applicationq Timely credit analysisq Predictable cash flowq Automated discrepancy recognitionq No reconciliation of payment and remittance
ANSI820835
VAN2
BALANCEREPORTING
BUYER/PAYER
SELLER/PROVIDER
ANSI820835CCD
VAN1
BUYER/PAYER BANK
SELLER/PROVIDER BANK
Example # 2: Value & Data Separate
$$CCD$$ ACH $$CCD$$
Rewards and Tasks
Early warning of discrepancies·Automated cash application·Predictable cash flow·Timely credit analysis·Must reconcile on value date·
ANSI820835
VAN2 BALANCE
REPORTING820/835
BUYER/PAYER
SELLER/PROVIDER
ANSI820835
VAN1
BUYER/PAYER BANK
SELLER/PROVIDER BANK
Example # 3: Value & Data Separate thru Bank Network
$$CCD$$CTX/820/835
ACH $$CCD$$CTX/820/835
Advantages to Sender
Send when you want·Use bank's warehousing·Control of delivery dates·Use receiver's timing·Internal simplicity / outsourcing·
FINANCIAL EDI ISSUES
! Often Last Implemented
! U.S. Bank Diversity
! Investment in Software
! Confusion Over Formats
! Lengthy Implementations
Often Last Implemented
7 Treasury not aware of other active EDI efforts
7 Conservatism
7 Concern about float loss
7 Concern about controls
FINANCIAL EDI ISSUES
U. S. Bank DiversityFINANCIAL EDI ISSUES
% 9,000 commercial banks% All are ACH capable.% Less than 10% are EDI capable.% Role of NACHA Banker's Council
Investment in SoftwareFINANCIAL EDI ISSUES
TYPICALEDI
TRANSLATORBANKING
EDI SOFTWARE
Confusion Over FormatsFINANCIAL EDI ISSUES
ACHBAI
ANSI X12 (820)
EDIFACT
ANSI X12 (835)NACHAHCPCS?????
PAYERS/PROVIDERSHIPAA
Long ImplementationsFINANCIAL EDI ISSUES
? EDI vs EFT vs FEDI? Financial standards developed? Need support from financial institutions? Understanding the path is critical? Implementation issues can be overcome
Summary
EDI Acknowledgements
• FunctionalAcknowledgements
• InterchangeAcknowledgements
• Application Advices
The primary purpose of aFunctional Acknowledgmentis to acknowledge the receipt
of
ONEFunctional Group.
FA ACKNOWLEDGES
Functional Group·
Transaction·
Error Detail·
Action at all levels·
FUNCTIONAL GROUP RESPONSE
Group control number·
Level of acceptance·
Transaction set counts·
Group level syntax errors·
TRANSACTION SET RESPONSE
Transaction set control number·
Level of acceptance·
Error codes·
TRANS. SET
___________ ______
__________
ERROR DETAILSegment and loop information·
Segment error codes·
Element information·
Element error codes·
Copy of bad data· ERRORSERRORS
SAMPLEFUNCTIONAL GROUP
GS*HC*PBS-DED*XYZ-RD*20001015*1630*700000001*X*004010X098~(1) ST*837*000000001~(2) BHT*0019*00*0123*20001015*1630*CH~(3) REF*87*004010X098~(4) NM1*41*2*PREMIER BILLINGSERVICE*****46*TGJ23~ :(40) SE*40*000000001~GE*1*700000001~
RESULTINGFUNCTIONALACKNOWLEDGMENT
ST*997*AK0000001~AK1*HC*700000001~AK9*A*1*1*1~SE*4*AK0000001~
SAMPLE WITH ERRORSGS*HC*PBS-DED*XYZ-RD*20001015*1630*700000002*X*004010X098~(1) ST*837*000000002~(2) BHT*0019*00*0123*20001015*1630*CH~(3) REF*87*004010X098~(4) NM1**2*PREMIER BILLING SERVICE*****46*TGJ23~ :(40) SE*40*000000002~GE*2*700000002~ Mandatory
ElementMissing
IncorrectTransactionCount
ST*997*AK0000002~AK1*HC*700000002~AK2*837*000000002~AK3*NM1*4~AK4*1*98*1~AK5*E~AK9*E*2*1*1*5~SE*8*AK0000002~
RESULTINGFUNCTIONAL ACKNOWLEDGMENT
INTERCHANGE ACKNOWLEDGMENT
Interchange control number·
Date and time·
Accept or reject·
Error code·
Sent within interchange envelope·
Not in GS - GE·
TA1 - Segment used to report status of processing for an interchange
TA3 - Segment used to provide a notice from the service request handler for delivery and to report services performed
INTERCHANGE ACKNOWLEDGMENT AND
NOTIFICATION
MailMail
SAMPLE INTERCHANGE
ISA*00*1234567890*01*EZMONEY * 30*22-1231234^^^^^* 30*33-5435433^^^^^* 000230*1262*U*00401
*900000003*1*P*:~GSGEIEA*1*900000003~
Bad date & time
SAMPLE INTERCHANGEACKNOWLEDGMENT
ISA*00*1234567890*01*BIG-BILL * 30*33-5435433^^^^^* 30*22-1231234^^^^^* 000301*0800*U*00401
*900000400*1*P*:~TA1*900000003*000230*1262*E*014~TA1*900000003*000230*1262*E*015~IEA*2*900000400~
824 - Application Advices
• Implementation Guide Compliance– Not X12 syntax errors identified by 997 FA
– X12N beginning to develop IG for 824
http://www.wpc-edi.com/spwg1
PROCESSINGEDI management software should handle acknowledgment issues.
Trading partners must decide on the level of error detail to support.
AGREE ON
What to send·Conditions to detail·Expected reply time·Response to non-receipt·Error condition procedures·
HIPAA Implementation Guides• Implementation Guides cannot change
more frequently than once each year.• Changes due to:
– Healthcare Industry Recommendations
– Federal Mandates
• National Committee on Vital and HealthStatistics– Formal Recommendations to Secretary HHS.
Change Request Coordination ?• 3 ANSI Standards Organizations
Memorandum of Understanding
X12
HL7
NCPDP
NUCC
NUBC
DCCDHHSNCVHS
• 3 Data Content Committees• DHHS / NCVHS
Implementation Guide / Data Content Change Request
X12 HL7 NCPDP NUBC NUCC DeCC
10 Business Days to Express Interest
WebRequest Form
WebRequest Form
Work Request Tracking System
http://www.hipaa-dsmo.org (FAQ)
X12 HL7 NCPDP NUBC NUCC DeCC
90 Days to develop organizational Recommendation (45 Day Extension If Needed)
X12 HL7 NCPDP
ApprovedChanges
ApprovedChanges
ApprovedChanges
MOU Guiding Principals
• Public Access – Single Point of Entry
• Timely Review of Change Requests• Cooperation and Communications• Consider All Viewpoints
• Evaluate Impact of Change Requests• Maintain a National Perspective• Conform to Legislation
Next Steps…
• Annually, MOU Steering Committee will provideNCVHS with a change summary & Recommendations.
• NCVHS Reviews & Provides Recommendations toHHS
• HHS– Initiate the HIPAA rule modifications accordingly– Federal Rulemaking process if required
• NPRM• 60 Day Public Comment Period• Response to Comments• Publish Final Rule
– Include a compliance date for changes to standards– Cannot be less than 180 days
Thank You!