February 9, 2012

Slowdown in Payments Being Created by New Standards

Slowdown in Payments Being Created by New Standards Tax & Business

A slowdown in Medicare’s processing of Part B claim forms has been widely reported. The reports say that new federal standards designed to streamline electronic insurance claims are instead slowing them down, which is hurting physician cash flow and pushing some practices into financial distress. One of these reports from Physicians News Digest says that Susan Turney, MD, the president and chief executive officer of the MGMA, urged HHS to postpone enforcement of the HIPAA Version 5010 standards for electronic claims and other billing transactions such as requests for claims status until at least June 30. In the meantime, physicians and insurers should be allowed to do business electronically based on the earlier Version 4010 standards, as have been reported by MGMA.

The new “Version 5010” refers to a set of rules governing how computers share healthcare billing data. The standards stem from HIPAA revisions developed to provide a standardized and easier way to communicate electronically, while preserving patient confidentiality. Version 5010 standards incorporate the use of ICD-10 diagnostic and inpatient procedure codes that are scheduled to become mandatory on October 1, 2013.

Medical groups that have made the change are experiencing glitches. PHD reported that the most frequently reported problems include:

  • practices that successfully tested retooled billing programs find MACs rejecting their Medicare claims now that the testing is over,
  • claims are bouncing back because the address for receiving payment was electronically stripped out somehow, and
  • some Medicare claims are simply getting lost.

Dr. Turney said that when practices have tried to report these and other problems to MACs by telephone, they have ended up on hold for 1 to 2 hours. When they do get through, they often are told that the problem must “lie with your clearinghouse.” In turn, clearinghouses blame the MACs for rejected claims, according to Dr. Turney. She also said CMS has advised practices not to submit large numbers of Version 5010 claims at a time, lest they further bog down the system.

For many practices these glitches resemble sending their claims into a black hole. They enter billing and patient data into their practice management systems just as they have always done and now when they attempt to send them through their clearinghouse to Medicare for payment nothing happens. While much of the problem seems to be with the processing by Medicare carriers, practice administrators should also explore the possibility that their practice management system vendors and clearinghouses have glitches. Version 5010 required substantial changes in data transmission from clearinghouses and practice management systems vendors, says David Glusman, a partner in Marcum’s Philadelphia office. While much of the problem may be with the Medicare carriers, practice administrators should also work closely with their claims vendors to verify that they are handling the new transactions properly.

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