Cutting Red Tape

While critics charge that the Affordable Care Act makes health care more complex, at least one provision has the opposite aim: Section 1104 of the ACA directs the Health and Human Services department to standardize many elements of electronic interactions between doctors and health plans.

In July 2011, HHS issued the first in a series of regulations aimed at administrative simplification, adopting operating rules to make it easier for physicians to determine a patient’s eligibility for coverage and to obtain the status of a submitted claim. HHS also has issued rules for electronic funds transfers and remittance advance between health plans and physicians, and established a standard for a national unique health plan identifier. Regulations to outline standards and operating rules for electronic claims attachments are planned.

Robert M. Tennant, senior policy adviser at the MGMA-ACMPE, formerly known as the Medical Group Management Association, offered his thoughts on whether these regulations will reduce practices’ administrative burden.

Question: Section 1104 of the ACA contains many provisions that physician groups have been advocating for years. Does the law offer a good chance for relieving the paperwork burden on physician practices?

Mr. Tennant: Yes, it does. It has a number of provisions that we long called for. After the passage of HIPAA, we found that the implementation of the electronic transaction standards required under the law did not achieve the level of simplification that we had hoped for.

So back in 2005, an industry group came together to create what are called operating rules. One of the first transactions they tackled was eligibility. The operating rules were set up so that if a health plan agreed to participate, it would have to provide information to practices on patient financials, copays, and deductibles, and they would have to get back to the practice within 20 seconds. But since the operating rules were voluntary, not all the health plans adopted them and not all the vendors saw the value in supporting them.

The ACA has made those operating rules mandatory. That is a huge change. To have the kind of real-world capabilities that the operating rules bring, such as identifying immediately the patient financial responsibility, will be extremely beneficial.

Question: Will practices see efficiency as a result?

Mr. Tennant: There’s no question. Just that one simple operating rule for eligibility means that, in 20 seconds, you can get an answer from the health plan. That alone is going to really improve patient intake and speed up the claim adjudication process.

Question: When will these changes begin to affect physicians?

Mr. Tennant: Jan. 1, 2013. Health plans must be compliant with operating rules for eligibility verification and checking the status of previously submitted claims on that date. But the linchpin here is the vendor. There’s a lot going on in health care. There’s meaningful use EHR [electronic health records] and e-prescribing incentive programs, not to mention the huge challenge that adoption of ICD-10 will bring, and all of these require practices to upgrade or replace vendor software. With all of these mandates and opportunities, this is probably a good opportunity for the practice to take a step back and look at what they have currently in the way of technology. What transactions are you conducting in-house? What are you outsourcing? What are the costs for that? What are your manual processes? Take stock of how you are managing the claims-revenue cycle. Then ask yourself, is this a good time for the practice to move ahead with a more automated approach?

Question: Many of the Section 1104 requirements apply to health plans. Will the plans do most of the work or do physicians need to make changes, too?

Mr. Tennant: Health plans and clearinghouses have to be able to accept and generate these transactions and support the new operating rules. And providers must use the standards if they conduct those transactions. But the government is not requiring practices to accept an EFT [electronic funds transfer] payment, for example. On the other hand, there is no prohibition against a health plan, such as what Medicare does now, saying that they will only issue EFTs. That’s a business decision that the health plan may make. It’s something that practices should be asking their health plans about.

Question: Do physicians need to buy new systems to take advantage of the operating rule requirements?

Mr. Tennant: In the past, providers may have asked themselves, ‘Do I want to spend a lot of money and buy a practice management system that has all the bells and whistles only to find out that not all the health plans are supporting these automated transactions?’ The answer was probably no. But, with the ACA, it solves that problem to a certain extent. Now health plans are required by law to offer, in a more standardized format, all of these electronic transactions and operating rules. It’s not voluntary anymore. That should be a signal to the vendor community that they now can start to build these supporting software products, with practices now able to take better advantage of these standards and operating rules. But if the practice doesn’t have the capability in the office to handle these transactions electronically, then they’re not going to see an advantage from the regulations. The challenge is going to be to determine if your current vendor, or the vendor that you’re exploring, has the capability of accepting an EFT transaction, for example.

Mr. Tennant works on federal legislative and regulatory health information technology issues at the MGMA-ACMPE. He is also a member of the Board of Directors of the Workgroup for Electronic Data Interchange.

While critics charge that the Affordable Care Act makes health care more complex, at least one provision has the opposite aim: Section 1104 of the ACA directs the Health and Human Services department to standardize many elements of electronic interactions between doctors and health plans.

In July 2011, HHS issued the first in a series of regulations aimed at administrative simplification, adopting operating rules to make it easier for physicians to determine a patient’s eligibility for coverage and to obtain the status of a submitted claim. HHS also has issued rules for electronic funds transfers and remittance advance between health plans and physicians, and established a standard for a national unique health plan identifier. Regulations to outline standards and operating rules for electronic claims attachments are planned.

Robert M. Tennant, senior policy adviser at the MGMA-ACMPE, formerly known as the Medical Group Management Association, offered his thoughts on whether these regulations will reduce practices’ administrative burden.

Question: Section 1104 of the ACA contains many provisions that physician groups have been advocating for years. Does the law offer a good chance for relieving the paperwork burden on physician practices?

Mr. Tennant: Yes, it does. It has a number of provisions that we long called for. After the passage of HIPAA, we found that the implementation of the electronic transaction standards required under the law did not achieve the level of simplification that we had hoped for.

So back in 2005, an industry group came together to create what are called operating rules. One of the first transactions they tackled was eligibility. The operating rules were set up so that if a health plan agreed to participate, it would have to provide information to practices on patient financials, copays, and deductibles, and they would have to get back to the practice within 20 seconds. But since the operating rules were voluntary, not all the health plans adopted them and not all the vendors saw the value in supporting them.

The ACA has made those operating rules mandatory. That is a huge change. To have the kind of real-world capabilities that the operating rules bring, such as identifying immediately the patient financial responsibility, will be extremely beneficial.

Question: Will practices see efficiency as a result?

Mr. Tennant: There’s no question. Just that one simple operating rule for eligibility means that, in 20 seconds, you can get an answer from the health plan. That alone is going to really improve patient intake and speed up the claim adjudication process.

Question: When will these changes begin to affect physicians?

Mr. Tennant: Jan. 1, 2013. Health plans must be compliant with operating rules for eligibility verification and checking the status of previously submitted claims on that date. But the linchpin here is the vendor. There’s a lot going on in health care. There’s meaningful use EHR [electronic health records] and e-prescribing incentive programs, not to mention the huge challenge that adoption of ICD-10 will bring, and all of these require practices to upgrade or replace vendor software. With all of these mandates and opportunities, this is probably a good opportunity for the practice to take a step back and look at what they have currently in the way of technology. What transactions are you conducting in-house? What are you outsourcing? What are the costs for that? What are your manual processes? Take stock of how you are managing the claims-revenue cycle. Then ask yourself, is this a good time for the practice to move ahead with a more automated approach?

Question: Many of the Section 1104 requirements apply to health plans. Will the plans do most of the work or do physicians need to make changes, too?

Mr. Tennant: Health plans and clearinghouses have to be able to accept and generate these transactions and support the new operating rules. And providers must use the standards if they conduct those transactions. But the government is not requiring practices to accept an EFT [electronic funds transfer] payment, for example. On the other hand, there is no prohibition against a health plan, such as what Medicare does now, saying that they will only issue EFTs. That’s a business decision that the health plan may make. It’s something that practices should be asking their health plans about.

Question: Do physicians need to buy new systems to take advantage of the operating rule requirements?

Mr. Tennant: In the past, providers may have asked themselves, ‘Do I want to spend a lot of money and buy a practice management system that has all the bells and whistles only to find out that not all the health plans are supporting these automated transactions?’ The answer was probably no. But, with the ACA, it solves that problem to a certain extent. Now health plans are required by law to offer, in a more standardized format, all of these electronic transactions and operating rules. It’s not voluntary anymore. That should be a signal to the vendor community that they now can start to build these supporting software products, with practices now able to take better advantage of these standards and operating rules. But if the practice doesn’t have the capability in the office to handle these transactions electronically, then they’re not going to see an advantage from the regulations. The challenge is going to be to determine if your current vendor, or the vendor that you’re exploring, has the capability of accepting an EFT transaction, for example.

Mr. Tennant works on federal legislative and regulatory health information technology issues at the MGMA-ACMPE. He is also a member of the Board of Directors of the Workgroup for Electronic Data Interchange.

While critics charge that the Affordable Care Act makes health care more complex, at least one provision has the opposite aim: Section 1104 of the ACA directs the Health and Human Services department to standardize many elements of electronic interactions between doctors and health plans.

In July 2011, HHS issued the first in a series of regulations aimed at administrative simplification, adopting operating rules to make it easier for physicians to determine a patient’s eligibility for coverage and to obtain the status of a submitted claim. HHS also has issued rules for electronic funds transfers and remittance advance between health plans and physicians, and established a standard for a national unique health plan identifier. Regulations to outline standards and operating rules for electronic claims attachments are planned.

Robert M. Tennant, senior policy adviser at the MGMA-ACMPE, formerly known as the Medical Group Management Association, offered his thoughts on whether these regulations will reduce practices’ administrative burden.

Question: Section 1104 of the ACA contains many provisions that physician groups have been advocating for years. Does the law offer a good chance for relieving the paperwork burden on physician practices?

Mr. Tennant: Yes, it does. It has a number of provisions that we long called for. After the passage of HIPAA, we found that the implementation of the electronic transaction standards required under the law did not achieve the level of simplification that we had hoped for.

So back in 2005, an industry group came together to create what are called operating rules. One of the first transactions they tackled was eligibility. The operating rules were set up so that if a health plan agreed to participate, it would have to provide information to practices on patient financials, copays, and deductibles, and they would have to get back to the practice within 20 seconds. But since the operating rules were voluntary, not all the health plans adopted them and not all the vendors saw the value in supporting them.

The ACA has made those operating rules mandatory. That is a huge change. To have the kind of real-world capabilities that the operating rules bring, such as identifying immediately the patient financial responsibility, will be extremely beneficial.

Question: Will practices see efficiency as a result?

Mr. Tennant: There’s no question. Just that one simple operating rule for eligibility means that, in 20 seconds, you can get an answer from the health plan. That alone is going to really improve patient intake and speed up the claim adjudication process.

Question: When will these changes begin to affect physicians?

Mr. Tennant: Jan. 1, 2013. Health plans must be compliant with operating rules for eligibility verification and checking the status of previously submitted claims on that date. But the linchpin here is the vendor. There’s a lot going on in health care. There’s meaningful use EHR [electronic health records] and e-prescribing incentive programs, not to mention the huge challenge that adoption of ICD-10 will bring, and all of these require practices to upgrade or replace vendor software. With all of these mandates and opportunities, this is probably a good opportunity for the practice to take a step back and look at what they have currently in the way of technology. What transactions are you conducting in-house? What are you outsourcing? What are the costs for that? What are your manual processes? Take stock of how you are managing the claims-revenue cycle. Then ask yourself, is this a good time for the practice to move ahead with a more automated approach?

Question: Many of the Section 1104 requirements apply to health plans. Will the plans do most of the work or do physicians need to make changes, too?

Mr. Tennant: Health plans and clearinghouses have to be able to accept and generate these transactions and support the new operating rules. And providers must use the standards if they conduct those transactions. But the government is not requiring practices to accept an EFT [electronic funds transfer] payment, for example. On the other hand, there is no prohibition against a health plan, such as what Medicare does now, saying that they will only issue EFTs. That’s a business decision that the health plan may make. It’s something that practices should be asking their health plans about.

Question: Do physicians need to buy new systems to take advantage of the operating rule requirements?

Mr. Tennant: In the past, providers may have asked themselves, ‘Do I want to spend a lot of money and buy a practice management system that has all the bells and whistles only to find out that not all the health plans are supporting these automated transactions?’ The answer was probably no. But, with the ACA, it solves that problem to a certain extent. Now health plans are required by law to offer, in a more standardized format, all of these electronic transactions and operating rules. It’s not voluntary anymore. That should be a signal to the vendor community that they now can start to build these supporting software products, with practices now able to take better advantage of these standards and operating rules. But if the practice doesn’t have the capability in the office to handle these transactions electronically, then they’re not going to see an advantage from the regulations. The challenge is going to be to determine if your current vendor, or the vendor that you’re exploring, has the capability of accepting an EFT transaction, for example.

Mr. Tennant works on federal legislative and regulatory health information technology issues at the MGMA-ACMPE. He is also a member of the Board of Directors of the Workgroup for Electronic Data Interchange.