The HIPAA healthcare electronic funds transfer standard for claims reimbursement from insurers is "EFT via ACH," and it works similarly to Direct Deposit.

Money is sent electronically from a health plan directly to the provider’s bank account and is required to carry the Reassociation Trace Number that allows for automated reconciliation of the EFT with the electronic remittance advice.

Providers can save an estimated $1.53 per EFT via ACH payment compared to check payments, according to the 2013 U.S. Efficiency Index Report; other benefits include significant savings in staff time through automated reconciliation and reduced risk by having payments directly deposited to your bank account instead of receiving a check.

So, if EFT via ACH saves money, lowers risk, reduces errors through automated receivables posting, and allows staff to focus on secondary billing and improves cash flow, why haven’t more providers made the transition? Because there are challenges with EFT enrollment.

Enrollment for Direct Deposit of your payroll is simple. You complete one document, which takes about five minutes, return it to your Human Resources Department, and begin receiving your pay directly in your bank account.  Enrollment for EFT via ACH with 25, 50 or 100-plus health plans requires more information, multiple forms and considerably more staff time and resources. But there are ways to make enrollment easier.

* Identify where most of your payment volume is coming from and start there.  Prioritize your health plans by volume of payments received and have your office staff begin EFT enrollment with those organizations first.  Then have your accounting/office staff continue enrolling with a specified number of health plans each week.  Starting with the top 20 percent of your health plans will help move the majority of your claims reimbursements to EFT via ACH quickly.  The rest can be moved as time allows.

* Standardize information. The Healthcare EFT & ERA Enrollment Operating Rules established a maximum set of data fields that can be used in the EFT & ERA enrollment process that must be used in a standardized order.  So, if you are enrolling with multiple health plans, all of the information requested should be the same and in the same order.  Once you or your staff has identified the appropriate information for EFT via ACH enrollment, you should be able to use it to enroll with additional health plans.

* Use enrollment tools: The Council for Affordable Quality Healthcare (CAQH) has developed a free EFT & ERA enrollment database tool that allows providers to enroll with multiple health plans through one online process.  Providers complete the standardized enrollment form and select the health plans with which they do business.  CAQH notifies the health plans of the enrollment, and the health plan can then access the provider’s information.  For additional information on the CAQH EFT & ERA Enrollment Utility, visit

* Work with clearinghouses. Many providers work with healthcare clearinghouses for a variety of services.  One service that may be offered is EFT enrollment with health plans that the clearinghouse supports.  Performance Pediatrics in Plymouth, Mass., was able to increase receipt of EFTs via ACH from 65 percent to 90 percent using their healthcare clearinghouse to assist with EFT enrollment.

* Use account safeguards. With measures in place to protect the accounts of providers who accept the healthcare EFT standard, providers can be assured that health plans will not be able to debit their accounts in the event of overpayment.  A HIPAA transactions implementation guide, known as ASC X12 version 5010 835 TR 3, expressly prohibits debiting a provider’s account to recoup overpayments.  Additionally, financial institutions have treasury services available to prevent debits from being processed to providers’ bank accounts.  Providers should work with their health plans to understand overpayment recovery procedures and discuss with their financial institutions any services that can provide additional bank account protections.

Acceptance of the healthcare EFT standard for claims reimbursement allows providers to improve the efficiency of their account procedures, reduce errors, speed up secondary and patient billing, and reduce costs of payments received.  While enrollment with multiple health plans can be time consuming and providing bank account information can be concerning, there are resources available to assist providers in the EFT & ERA enrollment process and measures in place to safeguard accounts.  In the end, providers will find that the benefits of EFT via ACH will offset initial challenges and concerns with enrollment.

Priscilla Holland is the Senior Director of Healthcare & Industry Verticals for NACHA—The Automated Payments Network.

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