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CMS delays HIPAA 5010 enforcement until March 31

December 30, 2011

Health care practitioners who submit electronic claims are still required to have billing software meeting the new Version 5010 federal standard in place by Jan. 1, 2012. Those who do not will risk claim rejections after New Year’s Day.

However, U.S. Centers for Medicare & Medicaid Services (CMS) Office of E-Health Standards and Services (OESS) announced last month it will not actively enforce the software requirement until March 31, 2012.

The move comes amid concern that not all insurance plans, hospitals, health care practitioners or billing services will have software meeting the new ASC X12 Version 5010 standards by the beginning of the new year.

“While CMS may not actively enforce HIPAA 5010 compliance during the first quarter of next year, the Jan. 1 compliance deadline is still in place.

Optometrists should install and begin using HIPAA 5010 software by that time to ensure their claims will be processed. I believe most clearinghouses are ready,” said Rebecca Wartman, O.D., of the AOA Clinical and Practice Advancement Group (AOA CPAG).

“My advice would be for ODs to be prepared by Jan. 1 and not bank on carriers ignoring the rule during the first quarter,” concurred Douglas Morrow, O.D., of the AOA Third Party Center.

Under the federal Health Insurance Portability and Accountability Act (HIPAA), office management software vendors, billing services, and claims clearinghouses are required to update their products to meet Version 5010 standards. Health care practitioners must then test their updated software system to make sure they are working properly.

“OESS encourages all covered entities to continue working with their trading partners to become compliant with the new HIPAA standards, and to determine their readiness to accept the new standards as of Sunday, Jan. 1, 2012” the office said in a statement last month.

Most health care practitioners who file claims electronically in-house have probably received notices from their software vendors, billing services, or claims clearinghouses regarding compliance with the HIPAA 5010 standards, according to the AOA CPAG.

Practitioners who have not received information regarding HIPAA v5010 updates from their software vendors should check with their vendor representatives, the AOA Third Party Center emphasized.

Similarly, practitioners who hire billing services to file claims should check to make sure their software systems will be updated to meet HIPAA v5010 standards before Jan. 1, 2012, the AOA CPAG advised.

Once vendors or billing services have indicated their products and systems have been updated to meet v5010 standards, practitioners should test to make sure their claims will be filed smoothly and other transactions can be accomplished without problem, the CMS emphasized.

Optometrists who spoke with the AOA News last month reported they had already received updates from their software vendors, tested the updated software, and found they were able to conduct transactions successfully.

Earlier this year, the CMS announced that, under federal law, all electronic claims filed in a manner not compliant with the new HIPAA v5010 standards would be rejected beginning on New Year’s Day.

Under the new delayed enforcement policy, the CMS will not require rejection of non-v5010-compliant claims until at least March 31, 2012.  However, achieving v5010 compliance by Jan. 1 could help to greatly reduce the risk of claims rejection, the AOA CPAG noted.

The CMS similarly will not assess fines or other penalties for failure to meet the HIPAA v5010 standards until the end of March. However, the agency will begin accepting complaints regarding noncompliance on Jan. 1.

The subjects of such complaints will be notified by the CMS and expected to document good faith efforts to achieve compliance within 90 days.

In a CMS statement last month, officials said they opted to delay enforcement of v5010 compliance “based on industry feedback revealing that, with only about 45 days remaining before the Jan. 1, 2012, compliance date, testing between some covered entities and their trading partners has not yet reached a threshold whereby a majority of covered entities would be able to be in compliance by Jan. 1.”

The HIPAA v5010 software standards are designed in part to accommodate the use of ICD-10 billing codes, which the CMS plans to implement in October 2013.

Last month’s v5010 enforcement delay has been interpreted by some Washington observers as a move by CMS to help make it easier for the health care community to prepare for the eventual coming of the ICD-10 codes.

For additional information, including v5010 compliance testing instructions, see the AOA Web site 5010 page (www.aoa.org/5010).

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