Electronic claims rule includes exemptions - Policy Watch - starting 10/16/03, Medicare claims must be submitted electronically in a HIPAA-compliant format

Healthcare Financial Management, Oct, 2003

Beginning October 16, 2003, Medicare claims must be submitted electronically in a HIPAA-compliant format, according to a CMS interim final rule published in the August 15 Federal Register. The anticipated rule, mandated by the Administrative Simplification Compliance Act of 2001, identifies limited exceptions to the requirement, including:

* Roster billing of Medicare-covered vaccinations

* Dental claims

* Claims where there are two or more primary plans and Medicare is secondary

* Service interruptions beyond the control of the provider

Also qualifying for exemption ate providers with 25 or fewer employees and physicians, practitioners, and suppliers with 10 or fewer employees. This small-entity exemption applies only to billing Medicare electronically, not to implementing HIPAA transactions and code sets. Comments are due to CMS by October 16, 2003.

The American Medical Association (AMA) is sounding the alarm that those physician practices not compliant with electronic transaction standards by the October 16 implementation deadline could face a reimbursement logjam. An AMA survey of physicians, reported in the September 8 American Medical News, shows that only about half of physician practices have begun testing the HIPAA compliance of their electronic claims processing systems. After October 16, payers--including Medicare--must reject noncompliant electronic claims.

The AMA survey indicates that 13 percent or more of the respondents say they will switch back to paper claims if they are not compliant by the implementation date. An increase of as little as 5 percent of paper claims, AMA says, has the potential to swamp payers' administrative systems and delay payments. To minimize cash flow disruptions after October 16, HFMA advises members in physician practices to more toward full electronic implementation as quickly as possible and confirm with primary payers whether they have contingency plans for processing legacy system claims after October 16.

FINAL TRANSACTIONS STANDARDS PREPARATIONS

* Final Considerations for Implementing Transaction Standards and Code Sets www.hfma.org/resource/ focus_areas/HIPAA@ Work/400234.htm

* Key Questions for Final TSC Preparations www.hfma.org/resource/ focus_areas/HIPAA@ Work/400236.htm

* Contingency Planning for HIPAA Transactions (August 2003 hfm) www.hfma.org/ publications/members_only/ DigitalPerspective/ August_2003.htm

* HIPAA Myths Regarding Covered Entity Status and Transaction Standards www.hfma.org/resource/ focus_areas/HIPAA@ Work/articles/11_1_02_.htm

* Seminar: Revenue Cycle Impacts of HIPAA: An Operational Focus www.hfma.org/ education/seminar/ revenue_cycle_hipaa. htm

* Comprehensive List of HFMA's HIPAA Products and Services www.hfma.org/resource/ HIPAAlist.htm