Welcome to Financial Edge

Financial Edge, HIMSS’ financial systems eNewsletter, is your source for the latest issues and emerging trends focused on financial systems and related technologies within healthcare delivery.

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Financial Edge is provided to readers at no charge, but only to those readers who sign up to receive the online publication. To permanently subscribe to this complimentary information source from HIMSS, click here.

Published the third Tuesday of each month, Financial Edge is for HIMSS members, providers, payors, clearinghouses, vendors, consultants and anyone involved in connecting clinical and financial systems.

Through monthly topics, news briefs, guest editorials, member profiles and tools and resources, Financial Edge will provide an understanding of the trends and changes in financial systems, the value and benefits of financial and clinical systems integration as well as inform readers on ways to contribute and participate in the industry and within HIMSS.

In addition to Financial Edge, HIMSS offers other financial systems resources, such as white papers, fact sheets and FAQs.  Click here for a complete list.

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Breaking News: HHS Proposes Adoption of ICD-10 Code Sets and Updated Electronic Transaction Standards

On August 15, HHS announced a long-awaited proposed regulation to replace the ICD-9-CM code sets now used to report healthcare diagnoses and procedures with greatly expanded ICD-10 code sets, effective October 1, 2011.  In a separate proposed regulation, HHS has proposed adopting the updated X12 standard, Version 5010,* and the National Council for Prescription Drug Programs standard, Version D.0, for electronic transactions, such as healthcare claims.  Version 5010 is essential to use of the ICD-10 codes.

The proposed changes aimed at improving disease tracking and speeding transition to an electronic healthcare environment apply to health plans, healthcare clearinghouses, and healthcare providers who transmit any electronic health information in connection with a transaction for which a standard has been adopted by HHS.

View the ICD-10 code sets proposed rule and the updated transaction standards proposed rule. Fact sheets describing both proposed rules will be forthcoming. Comments on both proposed rules are due by 5:00pm Eastern time on October 21, 2008. 

HIMSS will be facilitating a response to these proposed regulations. Those interested in participating in this effort can contact Holly Gaebel, coordinator, healthcare information systems.

*For more details on HIPAA 5010, see the article below.

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Standards: HIPAA 5010 - Why is this important to HIMSS members?

HIPAA remains at the forefront of healthcare, and there are many components to this complex set of standards. Critical components of HIPAA are transactions and code sets, which many organizations and individuals in the industry are actively working on. Most often, we hear references to HIPAA 5010, so what is 5010 and why is it important to HIMSS members? 5010 is the latest version of proposed HIPAA transaction standards from the ASC X12 standards development organization.  There is also proposed NCPDP standards version D.0 to update the Pharmacy transaction standards for HIPAA, which are not discussed in this article.  WEDI and NCHICA jointly developed an industry timeline that suggests the implementation of the updated HIPAA transactions won’t be completed until 2014.

The ASC X12 version 5010 transactions (a.k.a. version 5010) focus on the electronic exchange of administrative and financial information between healthcare providers and health plans for patient care services, including eligibility inquiries, service (treatment) authorization and referrals, claims status requests, claims and remittance advice (claims payment). The updated HIPAA transactions (ASC X12 and NCPDP) also play a critical role with the future of ICD-10. Clearly, HIPAA’s transactions updates impact all healthcare stakeholders, from hospitals, pharmacies, physician offices, payors, billing software vendors and clearinghouses to consumers, with this sector taking on more significant responsibility for service payment.  

To shed light on this topic, Financial Edge spoke with someone who is considered a leading expert on ASC X12 5010 transactions—Don Bechtel, a Standards and Regulatory Manager for Siemens Healthcare and Chief Privacy Officer for Healthcare Data Exchange (HDX), a division of Siemens Healthcare. Mr. Bechtel contributes his extensive health IT experience through active participation and leadership in various industry forums on behalf of Siemens, including WEDI’s Board of Directors and ASC X12 Insurance Subcommittee and its Health Care Task Group.

1. Why is it important for us to move from the current version of HIPAA to HIPAA 5010?  

The current version of X12 HIPAA transactions are 8-years-old at this point.  When the industry first developed and implemented the ASC X12 version 4010 transactions (a.k.a. version 4010), the X12 standards developers for the healthcare transactions worked hard to develop standards that would meet most industry needs. But, this being the industry’s first attempt at defining national EDI transaction standards for all healthcare stakeholders (which until that time were done manually via phone or by paper or when done electronically used proprietary formats with proprietary code sets and had very little industry consistency) some problems were encountered. It’s fair to say that the version 4010 transactions are good standards but the problems that were encountered made implementation difficult and often required workarounds; thus, the transactions were less effective.  Version 5010 will eliminate those early workaround solutions. 

Also, since version 4010 was implemented, the industry has asked for more than 500 changes to the standards to support new business requirements or to correct old problems. These changes, available in version 5010, will improve the functionality of the HIPAA transactions, bring more value to the users, and meet many new needs for current business requirements, such as better POA reporting on claims, improved use of NPI numbers and a more functional eligibility transaction that will provide greater detailed information needed by healthcare providers when making treatment decisions. 

Read more.

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Viewpoint: Healthcare Banking—Healthcare and Finance Markets Integrate for Electronic Payment Efficiency

Healthcare banking integrates healthcare payment processes with banking infrastructure to lower administrative costs for both providers and payors.
With the growth of electronic transaction processing by providers and payors, financial institutions are looking to gain a bigger stake in the healthcare market by providing comprehensive services for healthcare providers and payors, as well as consumers.

We posed the following questions about the integration of healthcare and banking:

• What role should banks play in the healthcare market, as stakeholders continue to increase payment automation? 
• What can banks do to forge stronger relationships with both providers and payors?
• What are the challenges banks will face as they become bigger stakeholders in the healthcare market, working with providers and payors?
• And what can providers do in order to work effectively with these new stakeholders?

Here are the responses we received:

With their existing infrastructure for processing paper checks, banks can play a game-changing role in making intensely manual self-pay payment paper processes appear as electronic payments for healthcare entities. Hospitals and large provider groups should work with their banks and redesign their patient statements to contain deposit account-specific lock box addresses and patient account- and statement-specific bar coding. The banks must also agree to image each check and payment stub and associate them with the deposit account, statement and patient account. These changes will enable the bank to make lump sum deposits to each deposit account and deliver a transaction file containing deposit account number, patient account number, statement number, and payment amount. By also offering either a Web site with a searchable image repository or an electronic copy of images, healthcare entities’ accounts receivable departments can use two separate but similar processes for payor and self-pay payments.

–Brian P. Wells, FHIMSS, Chief Technology Officer, Information Services, The University of Pennsylvania Health System

What if we’d made as little progress in treating heart disease as we’ve made in streamlining healthcare?  Sadly, this is the case. It doesn’t have to be.  Banks could be key to the breakthrough.

Administrative costs burden the $2 trillion healthcare industry. We’ve made some advances. Electronic data interchange (EDI) enables physicians and other providers to submit claims electronically to health plans and other payors. The next logical step is for payors to reimburse providers electronically, eliminating paper statements and checks. But only an estimated 20 percent of all reimbursements are made electronically today.

That’s where banks come in. Banks can act as secure third parties for electronic transactions between providers and payors. But first, banks have to go into the lab, learn about the complicated healthcare industry, and then figure out how they can improve it. That will involve reducing fragmentation in the current system and increasing standardization. The patients are waiting.

–Kelvin Anderson, President, OptumHealth Bank, Member FDIC

We would like to hear from you. Please submit your view on Healthcare Banking to Nancy Vitucci, HIMSS Manager, Publications.

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Progress Amidst a Wicked Problem: A Brief History of Exchanging Clinical Data  

By Andy Galbus, MBA, FHIMSS and Mary Rita Hyland, RN, MBA

In order to fully appreciate the challenges of exchanging clinical data, it helps to reflect on the past. Past and present challenges demonstrate what has been known as a wicked problem. Horst W. J. Rittel and Melvin M. Webber define a wicked problem as having “incomplete, contradictory and changing requirements with complex interdependencies that are often unique to the local setting of the problem. The stakeholders of a wicked problem often have radically different world views for both understanding the problem and approaching its solution.” The story of the attempts to exchange clinical information sound very similar.¹

The story starts out in the 1990s with acronyms like CHINs, later CHIPs and then HIEs and RHIOs. Terms continue to emerge today such as Community Health Information Exchanges. These terms have been created with partnerships attempting to share clinical information for a variety of reasons. While there have been successes, this brief history will share some of the challenges and issues to be overcome by these types of organizations. It will conclude with the current day summarized and why the industry may still be amidst a wicked problem, which presents significant challenges for the industry to overcome. The promise that awaits is the improvement in our healthcare systems leveraging information technology and sound business practices.

CHINs or Community Health Information Networks were defined in 1994 as collections of computerized communications facilitating communication of patient, clinical and financial information among multiple providers, payors, employers, pharmacies and related healthcare entities within a targeted geographic area. They differed based upon their ownership, the number of participants, transaction volume, the level of integration with other systems and the range of applications. The main driver was to cut healthcare administration costs.²

Early CHINs included Ameritech, CHMIS/Hartford Foundation in Memphis; Integrated Medical Systems Hospitals in Colorado; SMS/HDX in Ohio, New Hampshire, New York, and California and United Healthcare of Minnesota.

Most Wired Magazine in Spring 2007 declared that CHINs were successful initially but unfortunately, later on, they did not gain full acceptance as methods to exchange healthcare information. The challenges included lack of industry standards, immature technology, politics, lack of trust in the overall process, lack of clear ownership over data and information and unclear sustainable business models.³

In January 1995, the San Antonio Health Care Partnership developed a community health information partnership or CHIP, rather than a CHIN. The partnership’s board of directors created an independent wholly-owned subsidiary—CHIP-CO—to facilitate the creation of the CHIP.⁴ Similar states also had or have similar partnership organizations. Several of these types of organizations have had successes but many have not had success beyond getting interested parties together to understand the challenges and begin to try to make some progress.

In 1996, RHIOs started to form. Early RHIOs included Medbridge, Indiana Health Information Exchange, Santa Barbara County Care Data Exchange (SBCCDE) and Vanderbilt. Each had differing business models, approaches and progress or outcomes.⁵

Over time, many of the partnerships’ (CHINs, CHIPs and RHIOs) observers and participants have shared stories of how the partnerships dissolved. Reasons vary but some speak of funding running out with no resources to continue working together. Others speak about funding being there but a key player or participant deciding they might lose business if they continue to work with their competition. Still others have written about the continued complexities in coming to consensus on what formats and interoperability standards can be used to transmit the data.

The past 12 years have also been complicated due to differences in terms and lack of consensus from all stakeholders as to what is and should be part of the exchange of information. One could even make a claim that use of some of the terms changed in part due to the negative connotation the previous terms were getting. To try and get beyond the differences in terminology interpretations, the U.S. Department of Health and Human Services (HHS) Office of the National Coordinator (ONC) awarded a contract to the National Alliance for Health Information Technology (NAHIT) for creation of consensus-based industry definitions and context around five key health IT terms, which included three terms focused on health information exchange:

• Regional Health Information Organization (RHIO): A health information organization that brings together healthcare stakeholders within a defined geographic area and governs health information exchange among them for the purpose of improving health and care in that community.
• Health Information Organization (HIO): An organization that oversees and governs the exchange of health-related information among organizations according to nationally recognized standards
• Health Information Exchange (HIE): The electronic movement of health-related information among organizations according to nationally recognized standards.⁶ 

Regardless of precise definitions for discussing exchanging information, business models are the primary key to long term success and sustainability of HIE organizations. There are so many different combinations of formulas as to how organizations have approached their exchanges. The principles/characteristics center primarily in the following areas:

• Who pays for the transactions
• How the network is funded such as with federal or state grants or private sources or a combination of these
• How/if the local, state, or federal government is involved
• Whether financial transactions such as claims are part of the same model and organization or if those transactions are part of a separate entity
• 1-way or 2-way transmission of data between parties
• Use of a third-party such as a clearinghouse

Many of the current health information exchange organization’s challenges and failing partnerships occurred within a very different context than did other data exchange activities such as those involving healthcare claims and other similar non-clinical transactions developed more than 20 years ago. This does not make their conversations less valid, however. In fact, there are more similarities than differences in the challenges they had to overcome to reach their level of success found today. The more dialogue clinical and financial stakeholders can have to share the past lessons and current challenges, the more quickly we—as an industry—can work together to improve healthcare.

Today’s good news is that a growing number of active participants are coming to the table to discuss openly the challenges and issues that must be resolved for long-term success. We can have hope that we are not amidst a wicked problem after all, but instead, HIE will be leveraged to support and promote improving our healthcare systems using information technology and sound business practices.

“Some problems are so complex that you have to be highly intelligent and well informed just to be undecided about them.”  — Laurence J. Peter⁷ 

Andy Galbus, MBA, FHIMSS, is unit manager-IT at the Mayo Clinic in Rochester, Minnesota. He has been employed by Mayo Clinic since 1996 and had eight previous years of information technology experience. Mr. Galbus currently manages an IT Quality Office, supporting administrative business systems with work focused on compliance and quality. Prior to his current position, he assisted in implementing and supporting electronic medical record systems throughout the hospitals in Rochester. Mr. Galbus is president-elect of the HIMSS Minnesota Chapter.

Mary Rita Hyland, RN, MBA, is the assistant vice president of regulatory affairs and the chief privacy officer at The SSI Group, Inc., a healthcare information technology company and healthcare claims clearinghouse in Mobile, Alabama. Ms. Hyland currently serves as chair of the SharpWorkGroup, chair of the Standards Committee for The Medical Banking Project, co-chair of the HIMSS Financial Edge Work Group and a member of various committees within HIMSS and WEDI. Ms. Hyland has 30+ years’ experience in the healthcare industry in various administrative positions including IT and insurance.

References

• Rittel, HWJ and Webber, MM. Dilemmas in a general theory of planning. Policy Sciences. 1973: 4(1973); 155-169.
• A CHIN primer.  Accessed August 15, 2008.
• Schwend, GT. Old RHIO Failures Evolve for Future Success. Hospitals & Health Neworks Magazine, April 18, 2007.  Accessed August 15, 2008.
• CHIN update: progress in community network development - community health information network. Available at http://findarticles.com/p/articles/mi_m0DUD/is_n1_v16/ai_16547759.  Accessed August 15, 2008.
• Thielst, CB and Jones LE, Editors. Guide to Establishing a Regional Health Information Organization. Chicago, Illinois: HIMSS; 2007.
• The National Alliance for Health Information Technology Report to the Office of the National Coordinator for Health Information Technology on Defining Key Health Information Technology Terms. Accessed August 15, 2008.
• Quote by Laurence J. Peter.  Accessed August 15, 2008.

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Specialty Clearinghouse: Coastal Medical Billing

By Susan A. Miller, JD

Coastal Medical Billing (CMB), located in Sutton, Mass., is a specialty clearinghouse that exclusively handles emergency medical billing for 59 fire departments and ambulance companies in four New England states (Mass., N.H, Vt. and Maine). Now processing 67,000 claims annually off the ambulance run sheets, CMB is growing substantially.

CMB was founded 14 years ago by an emergency medical technician [EMT], who has many years of field experience and worked in billing for a large ambulance company long before HIPAA. There are 20 staffers at CMB, including another EMT and a nurse; three CMB staffers tele-commute from Fla., Mich., and Ariz.

From about 25 percent of their clients, CMB receives ambulance run sheets electronically through field data programs loaded directly into CMB’s billing software. The rest of the run reports arrive as paper and are typed into the billing program and then scanned for long term storage.

All claims flowing to Medicare are delivered electronically. Despite an excellent software system and other up-to-date technology, all other claims are still dropped to paper.

Working with very small enterprises, CMB does things for its clients that will sound familiar to other clearinghouses, but often are a step beyond what larger clearinghouses may do. For example, CMB staff went out to the fire departments to do onsite HIPAA training. In addition, CMB secured National Provider Identifiers for all its clients. A “plus” for being able to offer these services: CMB has a HIPAA attorney who helps with these issues. Also, CMB helps its clients by providing onsite billing training when a new clerk is hired and by assisting with Medicare enrollment.

CMB, a small, specialty clearinghouse, much like its larger, multi-purpose counterparts, is working to process much less paper and complete much less data entry.

An independent consultant and attorney, Susan J. Miller, JD, has 35 years of professional leadership experience in teaching, biochemistry research and law. Currently, she is COO and CPO of HealthTransactions.com and the assistant project manager for the NJ-HISPC project. Ms. Miller has provided legal and consulting services to several healthcare vendors, to a national accreditation agency, federal government agencies, the Massachusetts Medical Society, Massachusetts Hospital Association and numerous other entities. She is the recent past Co-chair of WEDI SNIP, a member of the Steering Committee, is a founding Co-chair of the Security and Privacy Work Group and chairs many of the privacy and security sub-workgroups.  

HIMSS Launches New Financial Systems Work Groups

HIMSS is looking for volunteers interested in participating in the new financial systems work groups:

• Financial Edge Work Group: This work group will support HIMSS’ new financial systems eNewsletter. Work efforts include identifying authors and content and monitoring the newsletter performance scorecard. Visit Financial Edge.

• Public Policy Work Group: This work group will support HIMSS activities by responding to public comment periods, participating in industry calls, such as with CMS, and supporting industry testimonies/other public presentations focused around financial systems.

Participation in these groups is open to all active HIMSS members. Work activities are conducted through monthly, one-hour conference calls. If you are interested in participating or have any questions, please contact Holly Gaebel. These workgroups are supported by HIMSS Staff Liaisons Pam Matthews, CPHIMS, senior director, healthcare information systems, and Holly Gaebel, coordinator, healthcare information systems.

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Tool/Resource of the Month: Revenue Cycle Management White Paper

What external forces within healthcare are currently impacting revenue and what will the revenue cycle of the future look like, with technology changes focused on patient satisfaction, consumerism, and quality? Find out in the newly released white paper Re-engineering the Revenue Cycle for the Emerging Medical Consumer, now available on the HIMSS Web site. Prepared by the FY08 Financial Systems Revenue Cycle Task Force, the paper identifies the current state of the revenue cycle process best practices, summarizes the industry forces most likely to affect future revenue management and identifies both current and future technology trends. The Task Force just launched their new work effort for FY 09. If you are interested in being a part of this task force, please contact Holly Gaebel, HIS Coordinator, at hgaebel@himss.org or 312-915-9227.

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HIMSS Award Call for Nominations and Scholarship Call for Applications Now Open

The Call for Nominations for the 2008 Awards and the 2008 Call for Scholarship Applications are now open.  Both will close on Oct. 30.

Awards
Nominations for awards, which recognize the special contributions of individuals, groups, and organizations to the advancement of the healthcare profession as encompassed by the Society’s mission, must be submitted online to HIMSS. Awards are presented in four categories: Industry, Service, Publications, and Chapters; a complete list is available. Contact awards@himss.org or call Member Services at 312-915-9202 for more information.

Scholarships

Through the HIMSS Foundation Scholarship Program, student members studying in the healthcare information or management systems field are recognized for academic excellence and the potential for future industry leadership. Recipients receive a cash award and an all-expense paid trip to HIMSS09 in Chicago (some restrictions may apply). Scholarship applications are available. For more information, contact Yvonne Horton, coordinator, member services, HIMSS, at yhorton@himss.org.

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Upcoming Events

TAWPI Healthcare Payments Automation Summit (HPAS)
September 15-17
Westin Michigan Avenue, Chicago
http://www.tawpi.org/healthcare-pymts-summit.html

CAQH Administrative Simplification Conference
Sept. 24 – 25
Omni Shoreham Hotel, Washington, DC
http://www.caqh.org/adminconference2008.php

2008 HIMSS Public Policy Forum
October 28
National Press Club—Washington, DC
Watch HIMSS’ Advocacy and Public Policy Center for more details.

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The inclusion of an organization name, product or service in this publication should not be construed as a HIMSS endorsement of such organization, product or service, nor is the failure to include an organization name, product or service to be construed as disapproval.