CMS/HHS Issue Interim Rules for Payer Updates of Electronic Funds Transfer, HIPAA Standards

The Centers for Medicare & Medicaid Services (CMS) announced an interim final rule on Jan. 5, 2012, that addresses payers adopting standards for Health Care Electronic Funds Transfers (EFT) and Remittance Advice (RA) transactions under the Health Insurance Portability and Accountability Act of 1996 (HIPAA).

CMS is required under Section 1104 of the Patient Protection and Affordable Care Act of 2010 (ACA) to issue a series of regulations in the next five years “that are designed to streamline health care administrative transactions, encourage greater use of standards by providers, and make existing standards work more efficiently.”

The first regulation, issued July 8, 2011, covered the operating rules for two electronic health care transactions, which CMS says will make it easier for providers to determine whether a patient is eligible for coverage, along with determining the status of health care claims that are submitted to a health insurer. The second regulation in the series establishes EFT standards that are intended to save physician practices and hospitals up to $4.5 billion in the next 10 years, when it is implemented by health plans.

CMS also anticipates saving an estimated 800,00 pounds of paper and reducing greenhouse gasses by 2.2 million by using electronic payment in contrast to payments made by paper checks.

Future administrative simplification rules will address the adoption of:

• A standard unique identifier for health plans.
• A standard for claims attachments.
• Requirements that health plans certify compliance with all HIPAA standards and operating rules.

The interim rule can be found at www.ofr.gov/inspection.aspx.