Introduction and Overview

Transition to Healthcare EDI

HIPAA Standard Transactions and Code Sets
The Future of Healthcare
Technology and EDI: Healthcare
Privacy, Data Security and HIPAA
Compliance

August 20, 2001

Annenberg Hall
Harvard University
Cambridge, MA
Gary Beatty
gary@wpc-edi.com
Washington Publishing Company
Chair X12 Insurance Subcommittee
Communications in Healthcare
Limitations & Concerns

nTiming
nAccuracy
nHandling
nReconciliation
nStorage
OPTIONS

ANSI X12
Health Insurance Portability and
Accountability Act of 1996 (HIPAA)
Public Law 104-191
TITLE II, SUBTITLE F
Administrative Simplification

v 9 EDI Transactions
v Code Sets
v Identifiers
v Security/Privacy
Electronic Data Interchange - EDI

The exchange of business

Transactions in a standardized
format between multiple
organizations business
computer systems.
Electronic Commerce - EC

The application of technology

toward the automation of business
transactions and workflow
Kalakota & Whinston, 1997
EDI Internet Email

Imaging Intranet Fax

PROVIDERS INSURANCE AND PAYERS SPONSORS

Elig. Inquiry Enrollment

Eligibility Enrollment Invoice Enrollment
Verification Elig. Response Payment Order

Pretreatment Health Care Precertification

Authorization Services and
and Referrals Delivery Adjudication

Claim
Service Billing/
Claim Acceptance
Claim Submission Patient Info.

Claim Status Inq.

Claim Status Patient Info.
Inquiries Adjudication
Claim Status Rsp

Claim
Accounts
Payment Accounts Payable
Receivable
COMPONENTS of EDI

² STANDARDS

² COMMUNICATION

² SOFTWARE/HARDWARE
ANSI ASC X12 STANDARDS
INSURANCE AND PAYERS SPONSORS
834
Enrollment 820 Enrollment

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)
ANSI ASC X12 STANDARDS
PROVIDERS INSURANCE AND PAYERS
270
Eligibility Enrollment
Verification 271

Pretreatment Precertification
Authorization 278 and
and Referrals Adjudication

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)
 ANSI ASC X12 STANDARDS
PROVIDERS INSURANCE AND PAYERS
837
Service Billing/
275 Claim Acceptance
Claim Submission
276
Claim Status 275
Inquiries 277 Adjudication

Accounts 835
Accounts Payable
Receivable
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)
STANDARDS VERSUS
IMPLEMENTATION GUIDES
Three
Important Things to Remember About
X12 Standards
1.Unabridged
2.No Technical Answers
3.Series of Business Questions
STANDARDS VERSUS
IMPLEMENTATION GUIDES
Standards Implementation Guide
Mandatory Required

Optional Situational

Not Used
Washington Publishing Company
800-972-4334
http://www.wpc-edi.com
Communications

Submitter

Clearinghouses Value Added

Direct Networks

Receiver
Implementation Alternatives
WEB

Proprietary
Proprietary
HTML
Same
JAVA
Proprietary Clearinghouse
XML
Client Representing Proprietary
Both Parties Server

Provider Payer
Standard

Standard Standard

Proprietary Proprietary
or Standard or Standard
Clearinghouse
Clearinghouse
representing representing
Payer
Providers
Standard
SOFTWARE / HARDWARE
Standards
Enrollment Mapping
Security
Communications Purchasing

Accounts Quality Control

Receivable

Accounts
Managed Payable
Claims
Care Adjudication
BENEFITS OF EDI
Tactical – Reduced Direct and Overhead Costs
v Reduce the Accounts Receivable Cycle
v Improve Accuracy (5% data entry errors)
v Reduced Data Entry Time
v Smaller/Faster Transmissions at Lower Cost
v Reduce/Eliminate Rework
v Avoid/Reduced Data Entry FTE
v Reduce Operational Costs (office supplies, postal
costs, and telephone charges)
BENEFITS OF EDI
Tactical – Reduced Direct and Overhead Costs
vReduce the Accounts Receivable Cycle

80
70
60
50
% 40
Paper
30
Electronic
20
10
0
0-30 30-60 >60
Days
BENEFITS OF EDI
Strategic – Improve Process that directly impacts
healthcare stakeholders
Ø Improved patient, provider, and payer support
Ø Efficient information delivery
Ø Improved quality
Ø Fosters “Good Will” with patients
Ø Fosters closer working relationship between
organizations
BENEFITS OF EDI
Cultural – Creating a Competitive Advantage
q Increase responsiveness between healthcare
stakeholders
q Penetration of new markets
q Easier to do business with
q Improved relations with other organizations
Other X12 Transactions in
Healthcare
Healthcare Administration
• 277: Healthcare Payer Unsolicited Claim Status
• 274: Healthcare Provider Information
• 269: Healthcare COB Verification
• 270: Healthcare Eligibility/Benefit Roster

Healthcare Procurement
• 832 Price/Sales Catalog
• 850 Purchase Order
• 855 Purchase Order Acknowledgement
• 869/870 Order Status Inquiry/Response
Getting Organizational Buy In
Step One

•HIPAA Has Happened!

•Delays – Delays - Delays

•Will there be any changes?

Getting Organizational Buy In
Step Two

•Requires Top Down Management Support

•HIPAA will impact all aspects of Health Care

•Overcome Internal Politics

•ROI is Real

•Opportunity for Re-engineering

•Cost is Real ⇒ Investment

Getting Organizational Buy In
Step Two

•Financial Penalties Exist

•Biggest Penalty ?
Bad Press & Litigation
Aligning HIPAA Strategies
Step 3
IT
/W
eb
Str
ate
gy
Corporate Strategy HIPAA Compliance Strategy

gy
rate
St
AA
P
HI
HIPAA Requirements
Not all black and white

HIPAA
Transactions Identifiers Codes Privacy

REQUIREMENTS
HIPAA Assessments – Identify/Leverage Options
Your HIPAA Team
Step 4
Who needs to be involved
n Business / Administrative Staff
uManagement Support
uLine(s) of Business Staff
uQuality Control / Audit
uLegal
uHuman Resources
n Technical Staff
uEDI Analyst/Programmers
uNetwork Support
uSecurity
uSystem Operations
EDI Resources / Education
Step 5

n Skill Set Requirements

uHealth Care Knowledge
uEDI Knowledge
n Resources with Both are very Scarce
uFind people with healthcare knowledge
uTraining
tEDI Basic
tEDI Tools
Responding to
Consumerism in Healthcare
n Our product is HIPAA Compliant!
n Mergers / Acquisitions / Consolidation
n Business Partners
 Thank You!
gary@wpc-edi.com

www.wpc-edi.com
www.edipartners.com
www.hipaa-dsmo.org
aspe.hhs.gov/admnsimp