Will you be ready to submit your
electronic claims in the standard format mandated
by the Health Insurance Portability and Accountability
Act (HIPAA) no later than October 16 as required
by law? Will your payers be ready to process those
claims?
ASA members have raised far fewer questions about
the HIPAA Transactions and Code Sets regulations
than they have about the privacy rule. This makes
sense since the transactions standards are an information
systems and financial matter not an impingement
on physicians’ ethics and behavior. Conversations
with anesthesiologists and their practice managers
indicate a high level of confidence that their billing
companies and software vendors have taken care of
all the necessary changes. Several of the large
anesthesia billing companies likewise seem assured
that the transition to systems that generate and
transmit electronic claims in the HIPAA format will
be smooth.
Payers, for their part, believe that any problems
after October 16 will come from those who submit
claims; they will themselves be fully equipped to
handle HIPAA claims.
Other health information industry experts are much
less sanguine about the HIPAA-readiness of providers
and health plans, however. According to an April
survey conducted by Phoenix Health Systems and the
Healthcare Information and Management Systems Society
(HIMSS), only 39 percent of providers, 37 percent
of payers, 39 percent of vendors and 53 percent
of clearinghouses were conducting external testing
with their trading partners as of the testing deadline.
The experiences related by several anesthesia practice
administrators also suggest that there is reason
for concern. One billing manager discovered that
Medicare and Medicaid were rejecting claims because
the provider number was “invalid.” Worse,
the clearinghouse used by the practice was reporting
base units rather than minutes. One payer began
rejecting the claims pending receipt of anesthesia
records showing that the cases truly lasted five
or eight minutes. Another practice found that its
payers were not ready to accept the HIPAA-formatted
claims, which then had to be sent to a clearinghouse
to be converted back to the old format. In a third
instance, the practice gave up and began sending
paper claims.
There is so much at stake that it is worth making
sure that everything is under control. After October
16:
| • If you transmit electronic claims
that are not in the approved format, payers
will reject them. If they accept such claims,
they will commit HIPAA violations of their
own. |
| • Even if you transmit perfect HIPAA
claims, some payers’ information systems
may not be ready to process them correctly.
In that case, the claims will not be paid
correctly — or at all. The payers’
HIPAA compliance problems could potentially
create major cash flow problems for anesthesiologists. |
You can protect yourselves.
Test your electronic
claims transmission and processing now. Work
with your billing company, your information systems
(IS) vendor, your clearinghouse and your payers
to make sure that you are sending, and the payers
are receiving and accepting, the information that
will result in proper payment of claims after October
16.
Anesthesia and other medical practices generally
have had some discussion with their IS vendor or
billing service, but they need to ask specifically
whether the vendor has determined if Medicare, Blue
Cross/Blue Shield and the largest local payers can
read a HIPAA-compliant file. If such testing has
not been completed, practices should ask the vendor
to notify them when it is. It is worth finding out
whether the vendor has been or will be certified
by one of the third-party testing companies such
as Claredi, and if not, why not. Note that HIPAA
required providers and payers to have begun testing
by April 16.
Karen Trudel, Deputy Director of the Centers for
Medicare & Medicaid Services (CMS’) Office
of HIPAA Standards, advises that the Medicare carriers
are ready and urges you to call your local carrier
and ask to test some claims. The Medicare carriers
also have lists on their Web sites of clearinghouses
and other “submitters” who have successfully
tested their claims transmission. ASA, together
with other specialty societies, helped to create
the Web site on which practice management system
vendors can indicate which HIPAA transactions they
have tested
<www.hipaa.org/pmsdirectory>.
(See “Is Your
Billing System Ready for HIPAA?” in the January
2003 NEWSLETTER.)
The importance of testing actual claims is borne
out by the experience of a four-physician urology
group in Florida, which reported a horror story
involving claims sent through a major practice management
computer system and a large, well-known clearinghouse.
(See Source Material for a link to the report.)
The practice had to track down for itself the fate
of more than 1,000 claims lost in transmission.
This experience underlines the need to remain in
frequent contact with vendors until problems are
solved. As stated in a CMS white paper (number 5
in the HIPAA Information Series):
| “Communicate often with your business
associates. This ongoing communication is
a critical factor in achieving HIPAA compliance.
Follow up with your vendors and billing services
to ensure they stay on schedule. Identify
a contact person and establish regular calls
or status meetings. Work together to resolve
any problems or issues that may impact your
ability to meet HIPAA compliance deadlines.” |
If your billing office or IS vendor, or the payers,
tell you that there is no rush, inform them otherwise.
There is room for numerous errors in preparing an
electronic claim to satisfy the HIPAA requirements.
The HIPAA implementation guide for professional
claims (known as the “837”) is more
than 700 pages long. It is easy to imagine that
the value in any given data field might be incorrect
or missing or that there might be too many loops.
Testing and correcting takes time, and health plans
have finite resources. It would be to your advantage
to get in the queue early. To quote Ms. Trudel:
“Continued cash flow is dependent on a successful
handshake.”
Reporting Anesthesia Time
Under HIPAA
By convincing CMS to reject a proposed change to
the way in which anesthesiologists report time to
private payers, ASA has prevented a potential annual
loss to the specialty of approximately $127 million.
The HIPAA Transactions and Code Sets rules mandate
the use of a single format for the transmission
of electronic claims, remittances and certain other
health care transactions. The format for professional
claims, the “837” discussed above, is
developed by the American National Standards Institute
(ANSI) Accredited Standards Committee-X12N, which
is heavily dominated by payers. About two years
ago, the X12N committee proposed a set of addenda
to the 837 that included a restriction requiring
anesthesia time to be reported in minutes only,
not units. Medicare requires total minutes, which
it divides by 15 to come up with actual time units
reported to the first decimal place. Most private
payers allow the final unit to be rounded up to
the next whole unit. If CMS had adopted the restriction,
many of those payers likely would have started paying
fractional time units as does Medicare.
A change from rounded to fractionated time units
would yield an average difference in total units
per case of 0.47. Assuming a commercial conversion
factor of $48, that would result in an average $22.56
loss per anesthesia case.
Applying that average $22.56 loss per anesthesia
case across the total number of anesthesia cases
performed in the United States in a year and using
conservative assumptions, the loss to the specialty
would have been $126.9 million, or $5,076 for each
actively practicing anesthesiologist. This is shown
in Table 1.
Numerous ASA and Medical Group Management Association-Anesthesia
Administration Assembly members wrote to CMS urging
preservation of the ability to round time. ASA placed
Keith J. Ruskin, M.D., Chair of the Committee on
Electronic Media and Information Technology, on
the ANSI Accredited Standards Committee X12N. On
February 20, 2003, CMS published a final rule adopting
parts of the addenda, but explicitly rejecting the
minutes-only limitation on anesthesia claims.
No one should be surprised at further attempts by
X12N and the payers to eliminate our ability to
round anesthesia time. Anesthesiologists should
make sure that their payer contracts properly reflect
any agreement on the reporting of time and should
also monitor the processing of their claims in this
regard.