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The Impact on Financial Systems from Administrative Simplification Provisions in Current Healthcare Reform Legislation

By Joe Miller, FHIMSS

Joe Miller, FHIMSS

Take a careful look and you may be surprised to find buried deep within the Affordable Health Choices Act, H.R. 3200—leading healthcare reform legislation in the U.S. House of Representatives, provisions that will directly impact the financial systems side of the industry. These provisions, which cover topics from real-time determination of patient financial responsibility to electronic funds transfer (EFT), fall under a section entitled “Administrative Simplification.” Since these provisions are expected to reduce the costs of the almost $1 trillion healthcare reform package, they are likely to survive whatever bill is passed and have a significant impact on the financial systems side of the industry.    

The administrative simplification provisions in the bill represent a “what’s next” after 5010. In fact, it specifies that within two years of 5010 implementation, the Secretary of Health and Human Services (HHS) will issue an initial set of standards that establish requirements for acknowledgements, EFT and “timely and transparent claim and denial management processes,” as well as issue updates to existing standards.  

The bill also requires that new standards are authoritative, require no companion guides and be free of “optional” fields, industry goals that have remained elusive to date. Further, the bill recognizes the challenges facing providers as patients assume more of the cost of healthcare through higher deductibles and co-pays, by stipulating that standards be set to “enable the real-time determination of a patient’s financial responsibility at the point of service.”  

Finally, within a year of the enactment, the HHS Secretary will be required to issue a final rule to establish a National Health Plan Identifier system. This is intended to eliminate the plethora of plan identifiers that are used by the industry today.

According to HIMSS Director of Congressional Affairs Meredith Taylor, MPH, administrative simplification is just one of many health IT-related provisions included in H.R. 3200. “Reflected in H.R. 3200 are policymakers’ goals to leverage health IT to improve the efficiency of healthcare, whether it be by integrating standards for quality and administrative transactions into health IT or expand incentive payments for physicians that engage in quality reporting,” said Taylor. In relationship to the American Recovery and Reinvestment Act of 2009 (ARRA), Taylor stated that “the stimulus legislation aimed to provide a foundation for health IT by establishing leadership and funding mechanisms to incentivize the adoption of EHRs among providers. H.R. 3200 aims to build on that foundation.”

No doubt these will all be positive changes for the financial systems side of the industry, at least as we continue to try to gain efficiencies in what is still largely a “fee for service” reimbursement environment. What is far less clear are the “indirect” or downstream impacts of other elements in the bill that call for drastic changes in how care is delivered and coordinated. Remember, healthcare reform actually views the “fee for service” model as a major contributor to rapidly rising healthcare costs, by rewarding providers who deliver more care. To address this, the bill calls for moving toward newer models such as medical homes and accountable care organizations, care models that seek to incentivize providers to deliver improved quality and coordination of care. The reimbursement method for these care models, and the required systems changes, are far less clear. More on this topic in a future issue of Financial Edge. 

Joe Miller, FHIMSS, is currently the director of E-Business for the AmeriHealth Mercy Family of Companies. Mr. Miller has chaired and served on many HIMSS committees and task forces in both the financial and clinical systems areas. Currently, he chairs the Financial Systems Steering Committee. Mr. Miller’s book, Implementing the Electronic Health Record: Case Studies and Strategies for Success, was published by HIMSS in 2005 and he has contributed to numerous other HIMSS publications. 

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FTC Delays Red Flags Rule Enforcement

Earlier this month, the Federal Trade Commission (FTC) announced it was delaying enforcement of the Red Flags Rule until Nov. 1; the FTC previously had announced Aug. 1 as the date the Rule would become effective. During the next three months, the FTC will provide resources and guidance clarifying whether businesses are covered by the Rule and what they must do to comply. While the FTC has noted its concern that healthcare-related records, both administrative and clinical, could be an excellent source of information for fraud, many small providers have expressed concern about meeting these requirements. Visit the FTC’s Red Flags Rule Web site for additional information on the new deadline and practical tips on detecting identity theft in day-to-day operations, including a “how to” guide organizations can access to track their compliance.

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Save the Date: Financial Systems Webinar

Sept. 30, 12 – 1:30 pm Eastern

Explore what the healthcare finance market will look like in the next few years, as a result of the current healthcare activity in Washington, DC, during next month’s financial systems Webinar. The Webinar, HIT in the Next Five Years: Managing the Mandates of 5010/ICD-10, ARRA, Privacy and Security, and Healthcare Reform, is free to all active HIMSS members and CPHIMS credit will be available.

Upon conclusion of the Webinar, participants will:

1. Understand the overlapping timelines and key milestones for 5010/ICD-10, ARRA "Meaningful Use," Security and Privacy, and Healthcare Reform
2. Understand the pain points and opportunities across industry sectors
3. Identify important next steps for key health IT stakeholders

Additional details will be included in next month’s Financial Edge.  For more information, contact Holly Gaebel, coordinator, healthcare information systems, at hgaebel@himss.org.

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Unique Self-Pay Needs of Small and Mid-Sized Healthcare Providers

By Douglas Braun

Douglas Braun

Most small to mid-sized hospitals want online payment and cashiering capabilities similar to those deployed by large healthcare systems. They, too, want to reap rewards such as accelerated cash flow and lower payment collection costs.

However, many smaller healthcare providers do not have the budgets or the staffing resources to invest in elaborate electronic billing and payment systems.

Technology providers need to make sure they address the needs of healthcare organizations of all sizes. Smaller organizations need an affordably priced, PCI DSS certified online payment solution that offers electronic payment options to patients and guarantors but that does not include all the bells and whistles of a pricier system used by a multi-entity healthcare system. 

Smaller healthcare providers often pride themselves on their positive patient interactions, and they demand technology that provides customer service support tools such as those that manage refunds, one of the most sensitive customer satisfaction issues.

The entry-level payment service should give consumers the ability to make credit card payments online, over the phone or at time of service and have the capability to attach card swipe and check scanning terminals if needed. It should also offer hospital administrators support tools such as transaction search, multiple reporting capabilities for detail, summary and on-demand reports and the ability to electronically void or refund full or partial payments.

Payment information should also be supplied to the healthcare provider in a daily remittance advice file or in detailed reports so both electronic (EDI 835) and manual posting are supported. It should have the ability to apply account and payment validation rules as well.

A point-of-service solution should be capable of expanding incrementally into a full-service patient access portal. A non-disruptive growth path means that eventually, even a smaller facility can reap all the benefits of a large, metro healthcare facility.

Douglas Braun is the president and CEO of Toledo, Ohio-based Internet Payment Exchange, Inc. (IPayX), a provider of electronic billing and payment (EBP) technology solutions to healthcare providers. Visit www.ipayx.com for more information.

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Registration Now Open for Healthcare Finance News Virtual Conference & Expo

Healthcare Finance News, in collaboration with HIMSS, is pleased to announce its first virtual conference, to be held on Oct. 14-15. With 3D exhibits, on-demand event access, networking, and educational sessions, attendees will have access to the latest information available in the healthcare finance sector, without leaving the office. Participate in a live chat session with a speaker, exchange online business cards or attend one of many educational opportunities on topics during the Healthcare Finance: Industry Perspectives for Today’s Leaders event. With a total of nine, one-hour educational events occurring over the two-day virtual conference, Blair Childs, senior vice president for public affairs at Premier, Inc., will serve as the opening keynote with Healthcare Reform: The Implications for Healthcare Finance. Educational topics include tax exemption protection, positioning an organization to respond to a RAC audit, revenue cycle management innovations, healthcare finance in a tough economy, and others of critical importance to the healthcare finance audience. The event will close on day-two with David Chin, MD, MBA, partner and leader of PriceWaterhouseCoopers Health Research Institute, delivering the closing keynote on Surviving the Crisis: Not-for-Profit Healthcare and the Capital Markets. The event is free to qualified attendees.  Click here to learn more or contact Danielle Hartley, vice president, business development, MedTech Publishing, at danielle.hartley@medtechpublishing.com.

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Organizations Tasked with Maintaining National Standard Data Set for Healthcare Providers

By Kathleen Ochal-Thompson

The National Uniform Billing Committee (NUBC) and the National Uniform Claim Committee (NUCC) are organizations whose purpose is to maintain a national standard data set for bill forms for institutional (NUBC) and non-institutional (NUCC) healthcare providers. Both organizations are comprised of representatives from industry stakeholders, to include providers, payers, public health organizations, and standard maintenance organizations as well as vendors. Both the NUBC and the NUCC were named in HIPAA legislation as organizations to be consulted by the American National Standards Institute (ANSI X12) and the Secretary of Health and Human Services as the standard claim transactions were developed and continue to be modified. As a result, both committees work closely with these entities.

Committee members of both organizations represent their unique constituency affected by their respective healthcare claim form and EDI. The committee members maintain a national focus and are responsible for representing the views of their constituency relative to issues before either of the committees. This responsibility also requires committee members to have open communication channels with their constituents in order to obtain feedback on issues to be discussed at an upcoming meeting.  In addition, members may be required to poll their constituency for feedback on the impacts of any issues/questions that arise during a given meeting. 

The NUBC was initiated by the American Hospital Association (AHA) in 1975; the AHA chairs this committee. More information can be found at www.nubc.org.

The NUCC replaced the National Uniform Task Force in 1995 and is chaired by the American Medical Association. Additional information can be found at www.nucc.org.

Kathleen Ochal-Thompson is product manager - revenue cycle solutions, revenue cycle product management, at Siemens Healthcare.

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Financial Systems Steering Committee Meets to Plan FY10 Work

The Financial Systems Steering Committee met in Chicago on July 29 for its annual assessment of the financial landscape of the health IT industry. In addition to the ARRA and healthcare reform driven changes, the committee focused on 5010/ICD-10, administrative simplification and the challenges of increasing patient financial responsibility. Educational programs, white papers and other resources are being planned for release over the next year around these key topics.

The meeting was held at the American Airlines’ Admirals Club at O’Hare Airport. Meeting participants in the photo above (back row, left to right), are: Dave Cheli; Joe Miller, FHIMSS; Michael Talley; Ted Perkins, MBA; and Rick Morrison; pictured front row, left to right, are Russell Anderson; Philip Bradley; Miriam Paramore, FHIMSS; and Steve Wood, FHIMSS, FHFMA. Participating in the meeting via conference call were David Hammer, FHFMA, CHFP, MBA, MHA, and Laura Jantos, FHIMSS.

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Advocacy Update: Don’t Miss Next Month’s 8th Annual Policy Summit and National Health IT Week

Health IT advocates from across the nation will descend on the nation’s capital for National Health IT Week 2009, Sept. 21-25, promoting widespread adoption of health IT to improve patient safety and healthcare quality. The cornerstone event during National Health IT Week is the highly-anticipated HIMSS 8th Annual Policy Summit, Sept. 22-23 at the Renaissance Washington, DC Hotel. This year’s Policy Summit features a new HIMSS Health IT “Prep Rally” on Sept. 22, where participants will hear how public policy initiatives have led the health IT industry to this point in the legislative process, as well as enjoy an Anatomy of a Hill Visit comedy sketch featuring HIMSS volunteers. The next day during HIMSS Health IT Advocacy on the Hill and Reception, participants will put their knowledge and skills to use as they travel to Capitol Hill for prearranged meetings with their members of Congress and staff. At the conclusion of Hill visits, participants and legislators will gather for the National Health IT Week Reception, where HIMSS will present its 2009 Federal Leadership Awards. Register today.

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Call for Award Nominations and Scholarship Applications

The 2009 Call for Award Nominations and Call for Scholarship Applications are now open.

Award Nominations—Call Closes Oct. 30
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. Awards are presented in four categories: Industry, Service, Publications and Chapters; a complete list is available online. Contact awards@himss.org or call Member Services at 312-915-9202 for more information.

Scholarships Applications—Call Closes Oct. 31
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 HIMSS10 in Atlanta (some restrictions may apply). Scholarship applications are available online. For more information, contact foundation@himss.org.

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