Industry moves on HIPAA standards, but transition will be slow

Washington -- Physicians may view the federal electronic data interchange standards as a broken promise. But private groups are working together to put the simplification back in this part of the HIPAA administrative simplification provisions.

That's good news, but it is likely to take at least a decade or two for functional standardization to take hold, according to experts.

"It's a real mess," said Kepa Zubeldia, MD, speaking of the current status of compliance with this portion of the Health Insurance Portability and Accountability Act. Enormous variation still exists in interpreting the rule's requirements.

Some experts say that the Centers for Medicare & Medicaid Services allowed too much wiggle room in how companies interpret the transaction and code set rule, but that flexibility is by design, said Karen Trudel, deputy director of CMS' Office of HIPAA Standards.

The intent of the rule was never to impose standards on the industry, but to give payers, clearinghouses and physicians' offices the flexibility to comply with HIPAA while maintaining the unique needs of their business practices, she said.

However, that variability has made things more complicated, rather than simpler when it comes to sending claims and other electronic forms, said Dr. Zubeldia.

HIPAA implementation has seen a rise in companion guides -- manuals published by payers and clearinghouses that define their own interpretations of the HIPAA standards and unique requirements for filling out claims and other electronic forms. Before HIPAA, they numbered around 400, and now there are more than a thousand.

The companion guides are complicated and often impossible to read for physicians, few of whom are trained in the highly technical requirements of such electronic forms, said Dr. Zubeldia, who gave up the practice of medicine and started Claredi, a company in Salt Lake City that develops electronic data management tools.

Not surprisingly, most physicians have chosen to rely on software vendors and clearinghouses to make the transition to electronic transactions for them, said David Feinberg, president of the computer consulting company Rensis Corp. in Seattle.

"No one expected the small provider to know what to do, but we did expect them to require their vendors to get it done," he said.

While that industry effort seems to be going slowly, developing standards is a complex and multilayered process, Feinberg explained.

"It doesn't matter how well you craft a standard, it will always be incomplete," he said. "There is all this stuff that needs to grow up around the standard."

That stuff will take time.

"We, as an industry, have a long way to go," said Robert Tenant, government affairs manager for the Medical Group Management Assn.

It could be a decade or more before the medical community obtains the ultimate goal of having universal standards by which the average physician can communicate electronically with payers without the intervention of clearinghouses and other intermediaries.

HIPAA convergence project

The evolutionary process toward that goal began when the HIPAA rule was introduced.

Dr. Zubeldia says his company is trying to help the industry take another step on that road. Claredi offers a paid service allowing businesses, including physicians' offices, to check whether their electronic claims and transactions match the requirements of payers. In setting up that service, the company has collected more than a thousand companion guides from payers and clearinghouses.

As a byproduct, Dr. Zubeldia has created a matrix detailing all the elements required by individual companies. This allows various payers to compare the data elements they require against the rest of the industry.

Participation in his effort, dubbed the HIPAA Transactions Convergence Project, is free and voluntary, but Dr. Zubeldia and other experts hope it will help bring industry closer together in what data elements they require physicians to include in their claims and other electronic forms.

A participant in the convergence project could, for example, look at the matrix and find out that it requires a data element asked for by only a few other companies or that it doesn't ask for an element that most others do.

While there is no one telling them they have to conform to such conventions, it may put peer pressure on companies to come in line with the rest of the industry, said Feinberg.

Said AMA Trustee, Joseph M. Heyman, MD: "Standardizing the data in payer companion guides is an important effort to help reduce the heavy data collection burden on physicians and their office staff."

"The American Medical Association, through our participation in the National Uniform Claim Committee, is working to develop recommendations to reduce the number of different companion guides that are required by health plans for HIPAA transactions," he added. The NUCC is also working with the convergence project on that front.

The convergence project is "a wonderful idea," said Trudel. "We applaud any private industry effort to bring together businesses."

Industry cooperation is already showing benefits, said Tenant.

While physicians can now query health plans electronically about the eligibility status of patients who come into the office, those responses are now typically of the yes-no variety. But a new industry initiative is seeking to make those transactions more edifying by allowing physicians to get more detailed real-time information, such as co-pays, deductibles and covered benefits.