Most health plans already complying with new EFT standards, AHIP says
Health plans complying with standards, AHIP says
Health plans have two years to comply with new standards for electronic funds transfers, issued by HHS on Jan. 5. But according to a health insurance industry trade group, most plans are already on board with the requirements, which include uniform format and content requirements for electronic payment.
“We are reviewing the regulation, but this is consistent with what health plans use today and something we have been supportive of,” a spokesman for America’s Health Insurance Plans said in an e-mail.
Mandated by the healthcare reform law, the interim final rule, scheduled to be published in the Jan. 10 Federal Register, standardizes electronic funds transfers and remittance advice, or notice of payment. The regulation, which is open for comment until March 9, requires the use of a trace number that will link the transfers with remittance advice, thereby reducing inefficiency, HHS said.
“The disconnect between the two makes it difficult or sometimes impossible for the provider to match up the bill and the corresponding payment,” HHS said in a news release. Trace numbers will avoid “costly
manual reconciliation that must currently be done,” HHS said.
HHS says the move will save up to $4.5 billion over the next 10 years. That figure jumps to about $16 billion when earlier electronic standards—issued in July for health coverage eligibility and claim status—are figured in, the department said in the release.
Those savings estimates are realistic, said Rosemary Sheehan, vice president of revenue-cycle operations for 12-hospital Partners Healthcare, Boston. She acknowledged that many plans are already paying claims electronically or have a plan to get there, but she said the rule was needed to push compliance among other payers, including smaller ones, and to ensure uniform practices.
The worry lies in how the rule will be enforced, added Sheehan, who coauthored a 2010 study in Health Affairs highlighting the cost of a complicated payment structure and calling for a more streamlined billing system. “Who will make sure plans take these standards and interpret them in the same way?” she said.
Sheehan applauded the new standards, but said the larger issue is health plans’ communication about their billing rules. “Most payers do not publish their billing rules and they refuse to provide that kind of detail when we request it,” she said. “We’re told that information is proprietary and we’re left to figure it out on the fly.”
Each payer has different rules for billing for each service, Sheehan said, and that means a lot of system modifications and additional administrative costs. “We could make it a lot easier with one set of rules, but I think payers would view it as a competitive disadvantage,” she said. “I don’t see that on the horizon.”