How is the HIPAA 5010 Transition Going?

 

At the beginning of 2012, the mail room at El Paso First Health Plan saw a spike in incoming letters-and they weren't New Year’s greeting cards. No, the bulging mailbags contained paper claims. And they kept coming until the end of February.

"We saw a 14 percent increase in paper," recalls Sharon Perkins, director of information technology at the Texas payer, which processes some 75,000 monthly claims, primarily for the state's Medicaid program. The paper claims had to be re-keyed into El Paso First's claims management system, a labor-intensive process that caused a substantial increase in overtime pay.

Ironically, the surge in paper claims was caused by a federal program designed to expedite electronic claims. The HIPAA 5010 format-an electronic claims standard which took effect January 1-replaces its 4010 predecessor with a number of new reporting fields that enhance communications, at least in theory, between providers and payers in a standardized way.

For your consideration: 5010-Ready or Not, Here it Comes

Perkins attributes the temporary increase in paper to a lack of provider readiness around the new format. Simply put, if providers weren't prepared to submit claims in the new electronic format, they submitted them in the old-fashioned way-via paper. Typically, 85 percent of El Paso's claims come in electronically, but during the first part of the year, that figure tailed off to around 75 percent, Perkins estimates.

El Paso offers a glimpse into the broader industry's adoption of the 5010 standard-a cluster of functions which accommodate claims submissions (including the expanded data fields required by ICD-10), claims acknowledgements and other transactions such as eligibility checks.

For the most part, the transition went well for larger payers and providers, experts say. But a sizable segment of the industry struggled with the new format's adoption, a largely technological challenge which required billing system upgrades followed by testing with trading partners. Some of the struggles stemmed from industry confusion over government policy around the transition.

A feature story in Health Data Management’s June issue, “5010 Reveals Knots in Claims Processes,” takes a look at the readiness of the industry to fully transition to the new electronic transactions.