Group advises holding off on HIPAA enforcement

FRAMINGHAM (03/16/2004) - A group charged with advising the government on issues related to HIPAA law has suggested that the U.S. Department of Health and Human Services (HHS) continue its flexible approach to enforcement of the law's transactions and code set (TCS) provisions.

The rules were set to go into effect on Oct. 16, but fears of widespread noncompliance and the financial disruption that would ensue if improperly filed claims were not paid prompted the Centers for Medicare and Medicaid Services (CMS) to announce a "contingency plan" that would allow claims to be paid as long as entities showed "good faith" in moving toward compliance.

The Workgroup for Electronic Data Interchange (WEDI), which has been advising HHS on the regulations, said the results of a public meeting held in January suggested that a number of difficulties have stymied efforts to come into full compliance with the rules.

"Because of the size and complexity of the healthcare industry, achieving compliance will take time," wrote Ed Jones, WEDI's chairman, in a letter to HHS secretary Tommy Thompson. "As a result, WEDI reiterates its recommendation from April 15, 2003, to allow the industry flexibility in achieving compliance with TCS standards."

In addition, the group offered several recommendations designed to ease the transaction to HIPAA-compliant electronic claims, including better standards, better cost-benefit data, and a continued focus on achieving compliance "in a more realistic time frame."

Though HHS didn't return calls seeking comment on the WEDI letter, CMS last month suggested that it would continue the contingency policy of paying noncompliant electronic claims, albeit more slowly than claims that meet the HIPAA standard. Rather than the 14-day turnaround that compliant claims will receive, noncompliant claims will be paid in 27 days (as of July 1), a move the agency called "a measured step toward ending the contingency plan."

Still, it's not clear how close the agency is to officially scrapping that plan and fully enforcing the rule. The government's own data suggest that one in three claims filed early last month was not compliant, and Jones' letter to Thompson noted that the number of entities that still weren't compliant was "large but unknown," and suggested that a small number of large payers may be responsible for many of the compliant transactions.

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