HIPAA 5010: How much will enforcement delay help physicians and hospitals?

Carl Natale
by Carl Natale

When the Centers for Medicare & Medicaid Services (CMS) announced the enforcement delay of HIPAA 5010 standards, it was a bit tempting to declare "Deja vu all over again."

The CMS' Office of E-Health Standards and Services (OESS) will wait another 90 days before it starts penalizing covered entities for not implementing HIPAA 5010.  That means the deadline is extended to June 30.

[Download and read the statement: CMS Announces Extension of Enforcement Discretion Period for Updated HIPAA Transaction Standards Through June 30, 2012]

Since Jan. 1, there have been problems getting medical claims reimbursed. Here's what OESS has to say about it:

"Health plans, clearinghouses, providers and software vendors have been making steady progress: the Medicare Fee-for-Service (FFS) program is currently reporting successful receipt and processing of over 70 percent of all Part A claims and over 90 percent of all Part B claims in the Version 5010 format. Commercial plans are reporting similar numbers. State Medicaid agencies are showing progress as well, and some have made a full transition to Version 5010."

And they hope healthcare organizations use the time to colloborate on the solutions that will get them to a 98 percent success rate.

[See also: HIPAA 5010: What's causing reimbursement delays]

Physician's Practice reports that American Medical Association (AMA) CEO James L. Madara sent a letter to acting CMS Administrator Marilyn Tavenner asking for another extension. I'm sure this extension was in place before Madara sealed the envelope but he has to be thinking CMS is being very responsive these days. (BTW, if anyone has a copy of the letter, could they forward it to me?)  But I'm not sure the enforcement delay really helps. According to Physician's Practice, Madara outlines the problem:

“Many of these impacted physicians are facing dire financial situations in which they are struggling to meet their financial obligation. While we understand from our recent conversation with Medicare representatives that recent Medicare Part B claims processing rates for the 5010 transactions is 92.4 percent, the remaining 7.6 percent represents hundreds of thousands of claims that are not being paid and are resulting in cash flow problems for physicians and other health care providers and potential interruptions in patient care.”

Fines and penalties imposed upon healthcare entities that aren't in compliance are serious. But this a cash flow problem. Physicians and hospitals aren't getting paid. It seems what Madara really wants is a mechanism that will get the medical claim reimbursements flowing freely again.

What this means for the ICD-10 deadline

It's doubtful that CMS is making any of these decisions on a whim or in reaction to letters. This decision reflects much observation, analysis and debate. Maybe the HIPAA 5010 experience will influence the observation, analysis and debate needed when changing  the ICD-10 timeline. Hopefully the CMS will understand that enforcement discretion isn't going to ease financial concerns.