Government to Halt Processing Noncompliant Medicare Claims

Beginning next month, the federal government will stop processing electronic Medicare claims that are not compliant with standards required by the Health Insurance Portability and Accountability Act of 1996 (HIPAA).

On October 1, the Centers for Medicare and Medicaid Services (CMS) will begin returning claims to filers if they are not HIPAA compliant, marking the end of an exemption that had been in place since 2003 to give physicians and others time to become compliant with the regulations.

Returned claims may be resubmitted once they are compliant with the regulations, according to CMS. The rule applies to claims submitted under the fee-for-service Medicare plan.

CMS says that as of June, only about 0.5 percent of Medicare fee-for-service providers submitted electronic claims that were not HIPAA compliant. The highest rate of noncomplaint claims as of May was from clinical laboratories, with 1.72 percent being out of compliance.

Only 1.45 percent of claims from hospitals and 0.45 from physicians were noncompliant, according to CMS.

“We are firmly committed to an interoperable electronic health care system, and the close-to-100-percent compliance with HIPAA standards for claims shows that the health care industry shares this commitment,” said CMS Administrator Mark McClellan, M.D., Ph.D. “Ending the contingency plan for noncompliant Medicare claims makes sense. We'll be working with the noncompliant providers between now and October 1 with the goal of getting as close to 100 percent as possible before then.”

HIPAA required the secretary of Health and Human Services to adopt standards for health care claims and other financial and administrative transactions used by the health care industry. When fully implemented, the HIPAA standards are expected to streamline the processing of health care claims; reduce the volume of paper work; provide better service for providers, insurers, and patients; and cut costs.

To enable electronic submission of HIPAA-compliant claims, CMS continues to make available free or low-cost software through Medicare carriers and intermediaries, according to the agency.

To help APA members meet the compliance requirements, APA has developed a HIPAA educational packet.

APA members can access the packet in the Members Corner area of APA's Web site at<www.psych.org/members/index.cfm?> by clicking on “HIPAA Educational Packet” under“ Education.” Hard copies are available by calling the APA Answer Center at (888) 35-PSYCH.

Also available in the same section are the APA resources“ HIPAA Question and Answer,” “Ask a HIPAA Question,” and “View the HIPAA Bulletin Board.” Materials to help members train staff on HIPAA compliance are also posted. ▪