Roundup: Revenue Cycle Management WILL HIPAA 5010HURT
HOW WILL THE ADOPTION OF HIPAA 5010 (FEDERALLY MANDATED TO TAKE PLACE BY JAN. 1, 2012) AFFECT PRACTICE PROFITABILITY?
As with any change, things always get worse before they get better,” says Deborah Robb, physician services director, TrustHCS. “HIPAA 5010 is no exception.”
Indeed, although most of our experts remain cautiously optimistic that HIPAA 5010 will eventually improve the current state of affairs by helping to prepare the industry for ICD-10, many agree it may first cause budgetary shortfalls, which will be most keenly felt by smaller organizations. According to Jim Akimchuk, CFO, Culbert Healthcare Solutions, “The 5010 standards involve specific data-field adjustments and changes in how claims are submitted and processed by clearinghouses and payers.” Regardless of the difficulties associated with change, it’s not
something that can be put off any longer. The U.S. is the last industrialized country to make the move to ICD-10; most of Europe has been on it for years. Mary Pat Whaley, a fellow in the American College of Medical Practice Executives, says the American Medical Association (AMA) recommends the following to protect your cash in January: Submit as many transactions as possible before Jan. 1, 2012; decrease expenses before Jan. 1, 2012, to increase cash reserves; consider establishing a line of credit with a financial institution; research payers’ advance payment policies; and consider using manual or paper processes to complete transactions until the electronic transactions are fixed. - P.C.
Jim Akimchuk, CFO,
Culbert Healthcare Solutions By itself, the adoption of 5010 will impact practice profitability within the claims and remittance processes. Just as the HIPAA conversion a few years ago increased the incidence of delayed or denied claims, so will 5010 affect practice cash fl ow – but on a smaller scale.
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how claims are submitt
The 5010 standards involve specifi c data-fi eld adjustments and changes in
how claims are submitted and processed by clearinghouses and payers. These are changes that have failure points, which means they also have negative cash-fl ow consequences for those practices that are unprepared. For example, failure to comply with the new requirement to use nine-digit ZIP codes in the “billing provider” and “service facility location”
6 November 2011
WITH THE HIPAA 5010 DEADLINE RIGHT AROUND THE CORNER, HMT ASKED SELECT INDUSTRY EXPERTS THE FOLLOWING QUESTION:
address fi elds could mean delayed or denied claims. The cost of denial resolution may increase – at least temporarily – as processes are worked out. There is an expense component to consider, as well.
Practices must budget for either in-house or outsourced information technology staff to make software changes, and then coordinate testing and validation with payers and clearinghouses. Overall, 5010 will require a high level of one-on-one orchestration with each payer. The key to navigating the change with minimal
disruption to profi tability is to catch potential problems early. Understand specifi c vendor policies now to ease the transition and minimize denials and delayed cash fl ow. Ultimately, the fi nancial impact of 5010 standards on practice profi tability will depend on how well practices manage the details of the changeover, monitor failure points and communicate with payers, clearinghouses and other revenue cycle management vendors.
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