ARRA, HIPAA, PPACA, EIEIO, Mickey Mouse! Whew! Try to follow those acronyms or figure out which one is telling us what to do. Regardless of challenges to PPACA, each of these alphabet soup laws has set into motion initiatives that will benefit and simplify the business of health care, and we should be prepared to embrace and accept as inevitable in P&C.
First, let’s look at Health Insurance Portability and Accountability Act of 1996 (HIPAA). P&C, while initially intended to be covered, was left at the altar by HIPAA and not considered “covered entities” as were health plans and some of their trading partners. This gave P&C hall passes on complying with EDI standards, yet we still had the responsibility for privacy and security under a number of other laws. What was an escape from an administrative burden actually has many out in left field unprepared for the upcoming moves towards simplification through electronic commerce.
ARRA, the American Recovery and Reinvestment Act of 2009, on the surface looked like it was for transportation infrastructure funding. However, it also contained funding to drive the health care providers to an electronic-based health record system with exchange capability through Health Information Exchanges (HIE). The HIE connects disparate systems to build a connected care community. This is great for health care, but it has initiated committees to study the access issues a connected system creates.
Today, a P&C adjuster can order records related to a work accident or auto accident directly from the hospital or treating physician. Do we think the guardians of privacy are going to allow us access to all health information in the connected community? Not a chance. We need to prepare ourselves for a different paradigm in claims when it comes to medical records.
PPACA (Patient Protection and Affordable Care Act), the federal statute signed into law by President Barack Obama last March, in Section 10109(b)(2) requires HHS to consider whether the HIPAA standards and operating rules should apply to workers’ compensation, auto, and other non-covered programs by 1/1/2012. Expect P&C to officially be defined as “covered entities” under HIPAA shortly after the New Year.
What does this mean? P&C medical coverage will have to comply with the HIPAA EDI requirements and operating rules as health plans do today. This includes the ability to accept EDI transactions for eBill and all the related HIPAA transactions sets.
Minnesota has already adopted HIPAA EDI standards for all lines of health care, including P&C. Texas and California have mandated HIPAA EDI standards for workers’ compensation. Expect to see more states take on eBill initiatives like the Minnesota model in the next 12 months to stay ahead of the potential HHS 1/1/2012 ruling.
Lastly, AMA administrative simplification efforts focus on automating the physician practice. AMA estimates that claims waste from antiquated paper-based processes is in excess of $200 billion. The AMA and other national organizations, such as the IAIABC representing workers’ compensation, support a national standardized approach to administrative simplification and the adoption of HIPAA electronic transactions to reduce costs for all stakeholders, and facilitate eBill adoption.
This is the good stuff; the parts of recent legislation and the momentum created by such that you should embrace and implement to make it easier and less expensive to transact business in a modern healthcare community. That’s all folks.
Statements and opinions expressed in this blog post are solely those of the author. They are not offered as and do not constitute legal advice or opinion of Mitchell International, Inc.