Washington, D.C.
The Subcommittee on Standards and Security of the National Committee on Vital and Health Statistics held hearings on May 31 and June 1, 2001, at the Hubert H. Humphrey Building in Washington, D.C.
Overview of DSMO Process and Results of Fast Track for Transaction Standard Changes Needed to Assure Industry Compliance
Ms. Weiker reported the Designated Standard Maintenance Organizations (DSMOs) completed four steps of the fast track process. Some 231 change requests were processed, with 37 modifications in Category A: changes necessary to permit compliance with the standard or law that the Secretary could make in the first year of implementation. She noted not everyone was pleased with every outcome, but the process worked. She said it was disheartening to learn, after all this preliminary work, that fast track changes will be subject to an NPRM. Ms. Weiker expressed concern over whether HHS could meet the October 16, 2001 deadline.
Ms. Weiker said appeals were being filed and collaborating organizations were verifying that change requests with consensus were correctly implemented. Members noted it was critical that the industry understood proposed changes and could amend their implementation process. Dr. Zubeldia questioned whether appeals, which require more time and lack consensus, should be part of the fast track process. Ms. Weiker noted it was important to get consensus on items such as taxonomy in the first round of implementations. The group agreed it was essential that the industry saw that the DSMOs built through consensus and that the Department was committed. They had to have a firm resolution with clear indications without arguments about what was approved by the DSMO and would not change before the final rule. Anything with disagreements or appeals had to be moved back to future changes.
Panel 1: Roundtable Discussion of DSMO Process and Results by Participants
Ms. Weiker said NCPDP supports development of and compliance with guidelines regarding the review and opt-in process, including rules for opting in on a request, formulating an appropriate recommendation, and withdrawing from participation. Noting fast track had considerable impact on a confused industry, she said there was no reason for it to be repeated. NCPDP believed the normal DSMO process, outlined in the MOU, would work well.
Ms. Ward pointed out that all they heard was relevant to fast track--not the DSMO process in the MOU. She noted industry frustration and said the steering committee was surprised and disappointed to hear, after all this work, that the addenda identified will be subject to an NPRM. She suggested the lesson to be learned was to be sensitive about making requests of industry volunteers without assurance that HHS knew and could provide what was required on their part.
As an autonomous organization accredited by the American National Standards Institute (ANSI), Mr. Landen said X12 followed internal requirements woven into obligations to support the DSMO process and MOU. He cautioned against implementation of a deadline without sufficient lead-time and urged HHS to develop its own fast track for rule making. X12N did not want another “fast track,” but a consistent standard change process with an orderly, stable, predictable cycle, including industry consensus.
Dr. Suarez said the benefit of the DSMO change request process was single point of entry and a formal standardized format for maintenance requests. Fast track uncovered implementation challenges, the DSMO change request process suggested design flaws, and changes might be easier with external code sets than the rule-making process. As rules got delayed, implementation problems compounded. A Gartner group study found many organizations will not be able to comply with implementation time lines. He reiterated that implementation of all the rules should be coordinated and suggested a need to focus on standardized content.
Mr. Arges expressed appreciation for NCVHS’s recommendations to the Secretary that led to continuation of the HCPC J codes. He noted that X12 representatives unilaterally changed their group’s recommendations. Corrections to the implementation guides and needed changes were held up, while three important change request issues are appealed. Noting there is no time limit on the appeal process, he emphasized DSMOs need to establish an appropriate time frame for resolution to avoid costly retooling. NUBC will ask NCVHS to consider business rules around the use of clinical code sets, delineating the obligation to maintain and update changes.
Acknowledging they heard the expedited process was tough, Dr. Cohn expressed the full NCVHS’ appreciation. Dr. Braithwaite said, sitting in on meetings, he realized some of the conflicts and personal effort expended; he assured the process wasn’t “totally dead” within HHS. Ms. Weiker noted the need to develop a relationship with code set maintainers and for requesters to explain why the code set was refused by the HCPCS committee. Mr. Arges reflected on the need to understand how the code set fit into a sector of the industry. Mr. Suarez raised the issue of a more efficient way of maintaining non-medical external code sets. Mr. Landen observed that HIPAA changed the simple answer to what ought to be in an external code set versus a situational data element, introducing situational usage and “turf issues.”
Mr. Arges pointed out that code sets were a convenient way of making information easier to handle and machine readable. Dr. Zubeldia cautioned about a lack of publicly known due process in defining all situations in the code sets. Dr. McDonald noted hearing that code sets with business rules in them were more complicated and that dealing with big code sets, like a dictionary, was hard to do by consensus. Dr. Zubeldia suggested the demarcation between a value code and a field might be: X12 if the code or value belongs in more than one transaction, value code if it only belongs in one. He suggested, in some cases, it might be easier for processors to make all transactions X12. Ms. Ward noted that already was a change request: item 126 was to remove the data element in the institutional guide and mark it not used. The DSOMs decided, for consistency usage, to leave it as was. Members commented users couldn’t find information about some value codes used in lieu of a data element in the data dictionary; there was no regularity or rules and nobody knew where to look. Mr. Moertel discussed code sets and the HIPAA data dictionary and noted that hospitals have used value and occurrence codes for 20 years.
Dr. Braithwaite said NUCC’s contention that proposed standards should be in the community and preferred for national use sounded like reverting to pre-HIPAA. Mr. Moertel replied NUCC’s point was that the standard named into the rules had been tested, but never put into place in the industry. He emphasized a responsibility when recommending national standards to make sure they had been tested and used by the industry. Ms. Ward countered that people who didn’t want to implement what was put in front of them with the final rule weren’t likely to step up to test anything before a rule was issued. Mr. Landen reflected that people referred to NSF as “national similar format.” Around that standard core, trading partners deviated while on top a “lubricant” level allowed the standard to be tailored for particular industry sub-segment use. Those lubricant layers allowing local flexibility and trading partner-specific flexibility were gone. The environment lacked voluntary compliance; no one any longer had the ability to deviate.
Mr. Moertel reported entering 52 issues on the DSMO site. X12N opted in on all of them. Only two requests were honored. Noting providers are among the most under-represented groups at NCX12N, he said that result was not uncommon. The work group had accepted 26 of 46 claim issues for changes. Changes were not voted down, but changed prior to the DSMO meeting by three members of the X12N management team. Mr. Moertel’s right to appeal was restricted.
Ms. Klein said the challenge for Medicaid agencies was to crosswalk data elements into the standards available in the 4010 transactions without impacting client services or compromising the provider relationship. Medicaid had seen the DSMO process as an opportunity to improve work done creating the 4010 transactions--but was not prepared for the full-scale assault on significant data elements within those transactions. Ms. Klein detailed multiple ways the fast track process impacted Medicaid agencies and offered recommendations to improve the DSMO process.
Mr. Landen testified for six individual BCBSA plan employees who submitted requests through the DSMO process and reported they didn’t find the responsiveness expected. They were not asked to participate in the DSMO discussions and expressed concern about the degree of consideration. They noted the DSMO Web site needed to be more user friendly and provide the status of change requests submitted. Mr. Landen said the intense time demand of the fast track process and the cost of a Web site eroded communications.
Ms. Schulten discussed ASPIRE, a transaction gap analysis and demonstration project gauging if a HCFA 1500 paper claim form contains all necessary and required data for creating a HIPAA compliant version 4010 837 professional claim. ASPIRE identified gaps between mandatory data content, specificity gaps, ambiguity within data element crosswalks, and non-standard use of the paper claim format. Participants developed work-arounds and other solutions.
DSMO representatives clarified concerns expressed by the testifiers
Ms. Weiker said all of Mr. Moertel’s requests were reviewed in a consensus-building fashion; all organizations agreed on the categorization and priority of requests. Mr. Landen pointed out that change requests not considered critical (Category Bs) would be considered for the next version of the HIPAA guide. Ms. Weiker noted confusion about the WPC, DSMO, and X12N Web sites. She said the DSMO site was now fully functional, had results for all requests, and a requester or collaborative DSMO organization could file an appeal onsite. Mr. Moertel said the point wasn’t that the DSMO process was broken; the issue was with X12N and representation-- the management team changed the outcome before it went to the group and the discussions did not represent the constituents. Mr. Landen said X12N management felt comfortable with their decision to modify the work group’s recommendations: as managers, they were more in tune with changing parameters. He noted a need for detailed information and clarity on change requests so the steering committee could understand what requesters wanted. Ms. Ward said HL7 and NCPDP reached that level of detail on their Web site and HL7 and had offered their questionnaire to X12. Mr. Arges said he knew the frustration Mr. Moertel experienced: having X12 positions change at the last minute created frustration and doubt about who spoke on behalf of X12.
Ms. Ward commented on a request related to Medicaid and the pay and chase forwarded by the steering committee, then reversed. She noted HCFA made that determination; the DSMO process had nothing to do with reversal. Ms. Weiker said that according to the MOU, at this point, only the requester or a collaborating organization could appeal. But each DMSO was expected to bring all of its constituent's positions to their discussions and they now had the NPRM process.
Mr. Gilligan noted the Gartner study advocated an effective one-year delay achieved through flexibility in enforcement. AFEHCT opposed tying regulations together. He noted sensitivity on Capitol Hill to the likelihood that people would not be able to make an October deadline and recommended timing compliance to create a soft-landing. Those deploying resources shouldn’t be penalized; wait-and-seers and systems up graders needed a chance to comply.
Mr. Reynolds said compliance costs for health plans were underestimated. Many providers and plans had not adequately budgeted and would not be ready October of 2002. The Blues and business partners struggled with the piecemeal approach to implementation. Providers and the entities they met with had to figure out, from a business standpoint, what they had to do with sporadic, incomplete answers. This situation went beyond ANSI, and dealt with the reality of people trying to determine ways to offer health care to employees.
Mr. Tennant said MGMA supported a compliance extension of 12 months. MGMA urged health plans to enter trading partner agreements and establish testing schedules and timetables for accepting standard claims. MGMA contended that a delay with no fixed compliance date was counterproductive to administrative simplification and believed compliance should not be required until all the final rules are published. MGMA proposed implementation structured in four stages. Mr. Tennant identified critical implementation concerns for group practices.
Mr. Moran advised that, whatever the standards or date, desired readiness and compliance probably would be achieved two to three years after final implementation. A challenge in advising the Secretary was that readiness, defined in any firm way, was impossible to achieve prospectively. Issues were promising and difficult, not because of the EDI transaction interfaces and what it took for compliance, but because of the nature of the business processes. The character of customer contracts was a major impediment to a standardized world.
Ms. Klein spoke of funding constraints linked to how legislatures meet in respective states. She said Medicaid was crosswalking the codes and getting others added by the HCPCS committee, a process that takes substantial time. The HIPAA regulations require massive changes to systems, processes and business practices. Some 14 state agencies will replace management information systems; most will not complete re-procurement in time for the deadline and must purchase temporary solutions. Costs of HIPAA implementation are much higher than projected and states have serious concerns about budgetary implications. Agencies actively seek a legislative solution that extends the implementation period and creates a single date for compliance with the administrative simplification requirements of HIPAA.
Mr. Saccoccio said most AAHP member plans felt additional time was needed to comply with the electronic transactions and code sets. Reasons cited were: to avoid conflicts with other information system modifications, allow HHS to clarify regulations requirements and develop related ones, enable plans to coordinate implementation with business associates and other covered entities, and spread out compliance costs. AAHP advocated extension of the compliance period, coordination of the rules, and a compliance period beginning once the last final rule is out.
Agenda Item: Remarks by Jack Emory, American Medical Association
Mr. Emory urged the Department to promulgate final transaction standards as soon as possible. He noted he was disturbed to hear about publishing rules without an NPRM and said not having an open comment period would be legally challenged. He stated the AMA consistently advised that compliance be coordinated and he counseled deferring it two years, until all pertinent rules were published. Mr. Emory noted a number of prominent organizations that are WEDI members support S836 and 1975. He guessed most physicians were not taking steps toward compliance and predicted small practices would probably be the last people to implement the HIPAA provisions.
Mr. Schuping said a significant number of organizations hadn’t begun preparations and probably couldn’t make target deadlines. WEDI feared extending the dates might cause entities to reallocate resources and slow implementation. WEDI felt the Department wasn’t given sufficient resources to deal with the volume of comments and workload, and recommended identifying and allocating resources as soon as possible. He said it made business sense to view security along with privacy and the transactions and code sets with the identifiers, the provider identifier and the employer identifier. WEDI recommended the same enforcement dates for privacy and security regulations and a two-year time frame from when these issues are resolved. Health plans should be ready to exchange the standard transactions with trading partners beginning October of 2002.
Mr. Emory expressed concern at hearing the Department “couldn't do anything.” Congress seemed the only way to give everyone adequate time, once a package was developed. Mr. Saccoccio noted the need for coordination between security and privacy. Mr. Gilligan said he was unalterably opposed to tying regulations together. Mr. Moran observed a time-uncertain delay linked to regulatory actions subject to the whims of political action wasn’t a standard. Mr. Reynolds suggested how providers (particularly hospitals) select the transactions code sets, the identifier, and especially the NPIs, could dramatically change how they administer. He suggested in HIPAA there wasn’t a “final” rule, but an “initial rule.” Mr. Schuping reiterated that the bottom line (getting the regulations out as soon as possible) required additional resources. They needed to consider what could be accomplished with resources, set a realistic, achievable schedule they could believe in, and move forward.
Observing that everything would never be static, Ms. Ward cautioned everyone to consider the impact a delay would have on the industry. She disagreed with both extending and waiting until all the finals were published. If extending, she stressed being clear and firm about milestones, interim deliverables, and requirements. And she noted nothing about the transactions required the identifiers in final form. Ms. Weiker echoed these views; EDS opposed any delay.
Dr. Fitzmaurice noted they’d heard unanimous agreement. The industry would do it if all the standards were in place and they had time to implement and spread out capital costs--And HHS needed resources to get the standards out in a reasonable time frame. Getting something out people could build and protecting the electronic data was the next priority. Getting it done in the targeted time frame depended on what was devoted to it.
Asked for their top priorities for the next final rules, most testifiers chose security. Dr. Zubeldia noted the enforcement final rule wasn’t mentioned and could come out last, effectively giving everybody a delay in implementation. Mr. Gilligan encouraged the Secretary to be flexible with the enforcement in Section 1176. He suggested public comment, conveyed so those moving forward stayed committed, could resolve concerns. He pointed out perspective was lost about resources: they were looking at a multi-billion-dollar change and potential equivalent savings, yet the DSMOs struggled to come up with $30,000 to produce a Web site for public comment. Ms. Klein observed people would comply would they realized there was a benefit. Mr. Emory said physicians would not feel comfortable with more time, knowing the enforcement rule wasn’t issued. Concern about penalties was one thing that would keep them moving forward.
Dr. Zubeldia doubted both finality in the rules before implementing and compliance within a reasonable time frame could be realized. Dr. Zubeldia queried whether it was worth providing a non-disruptive method of implementation rather than running parallel systems an extended time. Mr. Reynolds pointed out that the same business process couldn’t be run against both sets in HIPAA. Mr. Moran observed almost everyone could pass compliant claims by October of 2002 if they only had to generate standard claims in one place, receive them in another, and return standard remittance advices. The concern wasn’t the interface, but back-end business processes on the payer’s side running on other rules. Another reason to move forward quickly was business processes had to be redesigned. Dr. Zubeldia suggested removing any penalty if providers don’t send standard transactions for a year would provide non-disruptive transition time. Dr. McDonald noted 20,000 non-standard codes had been reviewed and only about 700 new codes were needed.
Dr. Zubeldia identified several themes. A disruption theme: nobody wanted the disruption of this required implementation date. An everything-in-place-at-once theme, so everyone knew the rules, what had to be done, and only did it once. And a concern that having everything at once caused changes in business processes: an everything-at-once-is-a-lot-to-swallow theme. The MGMA proposed implementing phases. Dr. Zubeldia advised doing everything at once could take five years and might not be feasible considering implementation was an ongoing process. Was it better to use today’s identifiers another few years and today’s code sets a few more--or to have everything at once with an extra five years to implement?
Mr. Gilligan asked what HHS visualized: if they waited until all the regulations came out, a year or two later would there be a set of “regs” that covered the full spectrum of HIPAA with all the changes in one document? Given current resources, Dr. Braithwaite replied HHS couldn’t put out an omnibus. Testifiers wanted to move expeditiously, but Mr. Tennant noted that wasn’t what the House and Senate bill said. He suggested changing them to read “the earlier of.” Dr. Zubeldia said a date, 1998, was already in the Act. Dr. Braithwaite noted that with administrative priority, the privacy rule had gotten out faster than they had been able to do anything else because there were resources to move it. Mr. Gilligan said that was why he didn’t want the “regs” tied together.
Asked for preferences for implementing a step at a time, Mr. Reynolds said if providers took the NPI within 90 days after it was issued and used it on paper and/or electronic they would get some order. Transactions, code sets and identifiers administratively run through this world. Dr. Zubeldia asked if it would help if everybody concentrated their limited resources in implementing transactions with the code sets and then the identifiers. Ms. Weiker noted certain data elements didn't exist in the implementation that were used in back office business process type of service.
Dr. McDonald noted some sentiments wanted a fairly complicated set of things that would result in extensive delay. He said they needed to remember the provider and not let this become a mechanism for data gathering that made life harder. Nine transactions were approved. The question was whether to shut down modifications or make them small enough things could go on. Dr. Zubeldia proposed a statement of direction, inline with the white paper for attachments, that helped the industry prepare for the NPI or the payer ID. Mr. Blair said he heard that, if they give the industry confidence that the NPRMs were good predictors of what the final rules would be, they were more likely to begin implementation. Dr. Zubeldia suggested the Department could publish a summary of statements received during the comment period.
Dr. Cohn reflected that, though a lot of concern was expressed about the fast track process, without it no changes could have been made in initial regulations until implementation. He suggested supporting all A recommendations without question. Mr. Naminschon noted changes had to not only go through the DSMO discussion, but back to the SDOs. In many cases, especially Bs, changes could not be made in such a short time frame.
Dr. Zubeldia said filtering needed to take place to prevent conflict later during the NPRM phase. They should make sure consensus was reached before recommending a change. Noting everything was subject to appeal, they questioned whether, knowing there was disagreement among DSMOs, they should move appealed issues forward. Ms. Weiker said she hoped to have results and recommendations to the Subcommittee by late June. In June the group would look closely at requests appealed, making sure there weren't major industry issues. Ms. Greenberg said they were committed to working through the voluntary standards organizations. Only in extreme cases would the Department second-guess anything decided in that process. But the group noted the Department had to respond to issues during the NPRM comment period and had responsibility, and ability under the APA, to do fact-finding. One reason NCVHS was included in the DSMO and MOU process was to provide an open public forum. Ms. Ward said she couldn’t attend the June meeting but would e-mail details as close to then as possible. Dr. Cohn said whether a co-chair or another member of the coordinating council came was up to the co-chairs’ discretion.
Ms. Greenberg suggested including in the Federal Register notice for the meeting that the Subcommittee and then the Committee would consider the recommendations coming out of the DSMO process. Dr. Cohn suggested asking for written comment. Mr. Blair noted they wanted to encourage people concerned about how their views are represented to work within the DSMO process. He reflected that, though the Committee might hear specific complaints, they heard them mostly as examples of flaws in the DSMO process, as opposed to being an appellate entity for a specific decision. Dr. Cohn disagreed. Relatively specific legislative language in HIPAA stated the Secretary was to rely on the Subcommittee’s recommendations. Their responsibility was to take those recommendations, make sure they were appropriate and move them forward. The next meeting was not about the DSMO process, but about recommendations. Mr. Blair suggested, then, making sure all members had time to review with integrity each recommendation.
By the end of June, they had to review Category H and anything appealed for recategorization as an A. In seven days they would know items up for appeal. The June 27 meeting would focus on the results. The letter to the Secretary would address changes in the financial administrative transactions and the final rules to make them more implementable. They would announce that, hopefully they would be making Subcommittee recommendations to the Committee in June. Members discussed the seven Es awaiting policy decisions by the Department. Mr. Naminschon clarified that HHS could build the shell outlining changes, but couldn’t put it very far through the clearance process until they had the exact set of recommendations. Their goal was to have the final rule published by the middle of February, meeting the October deadline. Ms. Trudel said they would start drafting the regulation next week.
Dr. Cohn summarized the next steps: drafting the letter to the Secretary, the DSMOs completing their process, hearing about items up for appeal and understanding, soon as possible, results of appeals, then taking testimony from the DSMOs and anyone else in the community that needed to testify, and hopefully bringing something forward to the NCVHS at the June meeting. Dr. Cohn noted there were two letters to draft: one addressing what the DSMOs recommended and another focusing on general industry readiness and what HHS needs to do to support implementation. Ms. Greenberg suggested a sentence in the first letter encouraging the Secretary to expedite moving the changes recommended for the first year through this process. Mr. Blair asked if members felt it appropriate for the NCVHS to make a recommendation about whether the NPRM process was necessary. Noting the AMA stated a clear position yesterday, Dr. Zubeldia said they probably ought to explore how to expedite the process. He had seen some rules go through HHS and months after the NPRM there was a final rule. It didn't have to take three years. How could they expedite the process?
Dr. Cohn noted issues they heard that needed to be fashioned into a letter. The Secretary needed to provide leadership and funding to get out the remaining final regulations. HHS needed to consider an internal expedited change process to work with recommendations for changes to final rules applying to all the HIPAA standards. Dr. McDonald observed a few testifiers claimed everything had to be done at once; he cautioned everyone not to be lured into a position suggesting they thought that was true. Testifiers had urged the Secretary to provide for an update to UB92 and 1500 to enable increased comparability between paper and electronic formats; Dr. Zubeldia countered he’d heard anecdotal evidence that people want the paper formats obsolete, so everyone had to use electronic transactions. Ms. Trudel said there were significant problems the last time there was an attempt to redo the 1500. Noting the industry was beginning to realize the need for these changes, Dr. Cohn said the Secretary could provide valuable leadership and assistance.
Dr. Zubeldia said the concern he heard wasn’t about the paper form, but an inability to enforce the new identifiers and code sets on non-covered entities. Dr. Cohn recalled Ms. Schulten observed changes needed to be made either to the form or how it was used. Ms. Fyffe identified two fundamental business implementation issues. A weakness in the law did not require providers to use electronic transactions and, because of differences between identifiers, many providers and payers had to cope with fundamental differences in information. Mr. Landen questioned the value of maintaining a paper standard in a post-HIPAA world. Dr. Cohn noted a need to provide for transition. Noting it would be useful to indicate a standard way of communicating extra elements the ASPIRE project identified, Dr. Zubeldia supported a recommendation to NUCC and NUBC to look at an implementation guideline for the paper form aligned with HIPAA data requirements.
Dr. Cohn observed the testimony highlighted issues where the Secretary could take leadership in providing orderly implementation of HIPAA. Regulatory flexibility in regards to a modest, fixed delay was one issue. They heard a lot about the consternation caused by uncertainties at HHS over implementation dates, causing many to back off on implementation. He noted Dr. Zubeldia’s comment that HHS needed to make available to the industry current thoughts about what pending future regulations will require. And they heard about the lack of resources within HHS and other responsible agencies. Dr. Cohn said that they’d talked about needing adequate funding to make things happen; probably that applied to both getting the HIPAA out and getting everything implemented.
Mr. Blair identified three positions that the group might consider for the Committee. One: reflect priorities clearly heard to get the data security and the NPI “regs” out as soon as possible. Two: not do things that undermined elements in the industry working hard to move forward. Three: recognizing that with different transactions and code sets certain segments of the industry might have difficulty meeting the final compliance dates, NCVHS should monitor industry progress, giving special attention to those demonstrating best efforts. Dr. Braithwaite contended testimony contradicted that. The industry said it needed a fixed date followed by a more flexible implementation period with a fixed ending. Otherwise they would have to run multiple information systems. With a more structured, or even phased, implementation plan the industry said it wouldn’t have enough time. The majority needed, perhaps an extra year. Mr. Blair acknowledged that segments of the industry might need more time, but cautioned that wholesale delays could lose people their budgets. He suggested, instead, monitoring progress and seeing where delays were needed.
Dr. Braithwaite noted a reason people needed more time was that the standards stripped away intelligence in special local codes and identifiers required for the business process of adjudication. Adjudicating processing had to be redeveloped. Ms. Greenberg noted a reason for Medicaid was a legislature that met every two-or-three years: there was no way to fund timely implementation.
Dr. Zubeldia noted another leadership position the Department could take was issuing NPIs quickly, so parallel systems weren’t deployed for years. Dr. Cohn suggested they were looking at a modest fixed delay to encourage successful, orderly implementation. As they moved forward, they needed to observe who was having trouble and the Secretary might need a bit of regulatory flexibility, in a way that did not discourage implementation. Ms. Weiker noted small providers and health plans already had an extra year. Mr. Blair commented that a number of testifiers had been proactive, investing in the process and coordinating with WEDI SNIP. They had to consider giving them relief, if needed. Ms. Ward recommended giving a delay with a date, deliverables, and requirements, noting this spoke to HIPAA program offices not losing next year’s budgets.
Dr. Zubeldia noted clearinghouses claimed to be ready and the Medicare carriers would be ready a year ahead of schedule. Both use the EDI translator and mapping, which simplified the process. He suggested as long as the adjudication system didn't change and there weren’t repercussions in the rest of the business, implementation was feasible within the two-year time frame. The taxonomy codes and the removal of the local codes could be part of the deliverables. Ms. Greenberg said she was impressed with what Medicaid had done with the local codes. She didn’t know how much the HCPCS process could meet their requests, but she was sure HCFA would make every effort to do so. She realized taxonomy was a big issue, but said she wasn’t convinced the Blues couldn’t figure out what to do about local codes. Dr. Zubeldia observed that many of the Medicaid carriers and intermediaries that would be ready this October were BCBSA plans. He, too, was impressed that Medicaid was down to 600 codes, but noted only the Medicaid work groups knew them. Ms. Ward said they had been offered to the HL7 work group.
Mr. Landen noted there wasn’t commitment yet on how the NPI would be funded. They knew a bit about what the identifier might look like, but the Blue plans and others faced quite different scenarios and business issues as they designed their implementation strategy and system architecture. Sequential or piecemeal implementation wouldn't work for much of the industry. Dr. Zubeldia remarked on a request for a delay to change the back end system; he acknowledged there were business reasons to do that, but noted the back end system could be changed at leisure with a translator. Members discussed procedures in the law for testing new standards to be adopted by the Secretary and the Committee’s directive that any proposed standard should be out in the community and preferred for national use before it was adopted as a national standard. Members discussed the need for more HIPAA success stories and analyzing surveys of the industry, establishing the replicability of factors that made organizations successful and more explicit levels of granularity in order to make a recommendation.
Dr. Cohn proposed they craft the comments into a draft for discussion. A June 27 meeting was scheduled to further discuss recommendations to the Secretary and issues coming forward from the DSMO appeals process. The August hearing will focus on PMRI standards and, hopefully, some model issues. Hearing dates were scheduled in October and December; November dates were held open. The Subcommittee needed to decide whether to hold a hearing as part of the WEDI SNIPS success conference (November 12-14, in Orlando) to better understand the industry’s successes, issues, and barriers. Members would be surveyed and decide in June if a hearing in that context would be useful. Dr. Cohn distributed a list of issues for members to reflect on and discuss at the June 27 breakout session, along with letters requesting particular external code sets be named in the HIPAA regulations that had been referred to the DSMOs for comment. The Subcommittee would ask for testimony at hearings around the end of the year. Dr. Cohn asked Dr. Zubeldia to reflect upon previous discussions about incentives for the implementation of HIPAA and further develop a proposal that aided an early successful implementation.
Dr. Cohn convened these hearings of the Subcommittee on Standards and Security of the National Committee on Vital and Health Statistics (NCVHS), noting that the National Committee is the main public advisory committee to HHS on national health information policy. Dr. Cohn stated that the focus of the hearings is HIPPA administrative simplification. He explained that the role of NCVHS in HIPAA is twofold. In complying with HIPAA administrative simplification, the Secretary is to rely on recommendations of NCVHS. NCVHS has also been asked to: track implementation for HHS and Congress, identify implementation issues and barriers, and recommend strategies to mitigate these issues.
Dr. Cohn said the purpose of the first morning’s hearing was to talk with representatives from the DSMOs to better understand recommendations for transaction standards changes. That afternoon, they would broaden the discussion to include representatives from various industry segments, concentrating on implementation readiness, transactions, and general readiness issues as well as the DSMO process and results. The testimony would help NCVHS develop sound, informed recommendations for the Secretary, which they would discuss the next day.
Ms. Trudel read a letter from Secretary Thompson to Dr. Lumpkin, Chair of the full Committee, concerning NCVHS’s recommendation to retract adoption of the National Drug Code as the standard medical data code set for reporting drugs and biologics for certain standard transactions. At the February hearings, the industry presented problems with transitioning from the HCPCS codes to NDCs for reporting drugs and biologics. Secretary Thompson stated he had reviewed the testimony and agreed that the providers, health plans and health care clearinghouses raised compelling concerns. The Department intended to soon publish a notice of proposed rule making, so issues could be resolved before substantial conversion to NDCs was underway. Dr. Cohn thanked the Secretary for his prompt response, noting hopefully they would continue to move forward with other recommendations for the final rules and implementation guides.
Overview of DSMO Process and Results of Fast Track for Transaction Standard Changes Needed to Assure Industry Compliance
Ms. Weiker reported that the DSMOs completed the first four steps of the fast track change request process. Some 231 change requests were processed. While organizations have separate internal processes, the DSMOs followed these ground rules: each DSMO has a spokesperson; the chair, vice chair and secretary serve as facilitators, gate keepers and timers; timers facilitate discussion of all items.
Building consensus involves a seven-phase process. With phase one, steering committee member organizations classified, by a majority vote of organizations present, the change requests (regardless of collaboration status) into eight categories.
Category A is modifications necessary to permit compliance with the standard or law. According to HHS, items include: 1) elements in the adopted standard or implementation specification conflicts with the regulation, 2) a required but non-existent data element or code set, 3) an omitted data element or code set critical to the industry's business process; 4) conflict among different adopted standards; and 5) internal conflict within a standard implementation guide.
Category B is modifications classified as additions or deletions of data elements, internal code list values, segments, loops; changes in usage of segments, data elements, internal code list values; changes in usage note; changes in repeat counts; changes in formatting notes, or explanatory language outside category A.
Category C is maintenance of items that do not impact implementation of the transaction. Maintenance items require no further DSMO action and follow the Standard Development Organization (SDO) process.
Category D items require no change: implementation guides already meet the need requested or the request was not substantiated. Submitters may follow up for further action. Category E items require follow up by the HHS in regard to the final rule. Category F items were withdrawn by submitters during the business analysis phase. Category G items have been appealed: either a collaborating DSMO or the originator does not agree with the outcome of the business analysis phase. Category H items require additional comments from the industry to determine consensus.
Phase two is a majority vote by the collaborating organization (CO) on Category A change requests that individual DSMOs consider reached consensus. Recommendation will be accepted; any recommendation without agreement will be tabled for discussion in phase four. Phase three is a majority vote for change requests in Category B, as in phase two. Any without agreement will be discussed in phase six.
Phase four is a discussion of forwarded Category A change requests. Each CO spokesperson will have three minutes to present a recommendation, followed by a five-minute open discussion in which the spokesperson strives for consensus. An additional five minutes will be given when this appears imminent. Consensus recommendations will be drafted. When consensus is not reached, requests are tabled. Phase five addresses requests tabled in phase four in a five-minute open discussion with the CO spokespeople. If consensus still is not reached, a vote will be taken. Each CO has one vote; two-thirds majority moves the disposition forward. If consensus is reached, the recommendation will be drafted. If consensus is not possible, the request is referred back to each CO for further discussion and a final resolution to the original change request process. Phase six provides discussion for unresolved Category B change requests as in phase four. Phase seven addresses step six tabled requests as in phase five.
In this way, the 231 change requests were classified with: 37 in Category A; 33 in Category B, 50 in Category C, 95 in Category D, 7 in Category E, 6 in Category F, and 7 grouped together in Category G-H. Ms. Weiker said the DSMO recommendations and categorizations would be posted that day on the DSMO Web site.
In step five of the fast track change request process: the SSO will communicate the proposed changes to each CO, which will have 15 calendar days to review and confirm that solutions satisfy the disposition recommendation. Confirmed SSO changes will be incorporated into appropriate documentation. Changes not satisfying the recommendation will be referred back to the SSO for further development. The COs will have seven days to reach consensus with the SSO. If consensus is not reached, collaborating organizations may appeal. Ms. Weiker noted that some recommendations and categorizations will be appealed, adding, approximately 20 days, to the final resolution of the fast track change request. All category A and E requests will be forwarded to the subcommittee upon final resolution.
Some DSMOs have recognized areas where they believe improvement is needed. The DSMO will evaluate their performance and make necessary modifications to the process after completing a couple cycles of the normal change request process outlined in the memorandum of understanding (MOU). DSMOs remain committed to operating within the expedited process to assist HHS and the industry in making the necessary changes within the first year as described in section 160.104(b) of the final rule. Noting this process began with the expectation that it would result in a “final with comment,” Ms. Weiker said it was disheartening to learn, after all the preliminary work was done, that the fast track changes will be subject to an NPRM. She expressed concern over whether HHS could meet the October 16, 2001 deadline.
Ms. Weiker emphasized that these discussions and decisions will have significant impact on the industry. Most organizations have invested heavily in evaluating, testing and implementing the transactions and code sets and information in the NPRM might require additional evaluation, testing and implementation cycles. She noted that the DSMOs did a commendable job addressing the needs of the industry in such an expedited fashion: as with any consensus process, not everyone was pleased with every outcome, but the process worked.
Ms. Weiker clarified that the seven-step process was the business analysis phase addressing each change request forwarded to the appropriate standard-setting organization (SSO) to update the implementation guides. Collaborating organizations are currently doing step five in the overall six-step MOU process, verifying that the change request agreed to in the consensus process is correctly implemented. (Did X12N handle a request to change shoe size by putting it at the header in the 837 when it really belonged at the detail level?) Appeals--either by the requester or the DSMO--are also being filed.
In the final step, recommendations will be gathered, formulated, and forwarded to the National Committee. Within some 20 days potential additional changes to the implementation guides based upon appeals will be known. In about another 10 days, changes made will be reviewed by the collaborating organizations and forwarded to the Committee. Ms. Weiker explained that, per direction of HHS, HCFA, and the final rule, only Category A items (changes necessary to permit compliance) were brought forward. Other modifications, classified as Category B, will go into the next version of the implementation guides. Ms. Ward said Category As were items the collective DSMO steering committee found necessary for compliance--and so germane to the fast track and changes the Secretary can make in the first year of implementation. Category As will require an NPRM if HHS determines to move forward in that way. Category Bs are not urgent; these changes occur in a future version.
Dr. Fitzmaurice considered the probability of an NPRM as part of a dual challenge. The industry, challenged to come up with the most immediate things necessary to make the standards work, met with the Subcommittee and outlined the issues. Now the Department was challenged--Could it put this into place by October 16? Ms. Ward observed that whether October 16 was good enough for the industry’s implementation plans depended on what they were talking about. An NPRM that required a 60-day comment period and time before a final was issued was pushing it, with people shooting for an implementation date of October 2002.
Dr. Braithwaite reported on discussions with HHS’s Office of General Counsel to find a faster way to make this happen internally; they hadn't yet received word that there is an approved way. Dr. McDonald suggested reason to be optimistic. He said this might be analogous to the National Drug Code (NDC). Dr. Braithwaite confirmed that, at this point, an NPRM was being generated for NDC. Without another way, that had to be done. He suggested the Secretary’s announcement had at least laid groundwork; the industry knew the NDC issue had been resolved within HHS.
Dr. Zubeldia questioned putting appeals, which would take an extra month and didn’t have consensus, into the fast track process. Everyone would agree with the NPRM on requests with consensus and they could be “fast tracked” to a final rule. Even if appealed and resolved within a month, the NPRM provided a second mechanism of appeal that would delay the whole process again. Ms. Weiker said they would not utilize the appeal mechanism that exists in the MOU process. She noted some forthcoming appeals stem not from a lack of consensus about the DSMOs’ decisions, but from the recommendations’ categorizations. Seven Bs had been appealed for further industry input. She said it was important to get consensus on items such as taxonomy in the first round of implementations, rather than putting them off. Ms. Ward concurred. Ms. Ward noted that in April, the DSMO steering committee decided not to invoke appeals right away when collaborating organizations could not agree on the disposition, but for organizations to request public input, seeking insight on how to move forward. Appeals were included on the Washington Publishing Company (WPC) Web site for another round of public input.
Ms. Weiker reported that the recommendation for the professional guide was to make taxonomy a situational data element (currently it is mandatory). Comment is sought from health plans needing taxonomy. The recommendation for the institutional guide was to not use taxonomy for institutional (currently mandatory). Comment is sought on whether not having taxonomy on an institutional claim would cause anyone problems. Ms. Weiker emphasized the importance of making these decisions now.
Dr. McDonald acknowledged some snags in the administrative road. They wanted to make it easy and agreed upon so that it worked for everybody. But with all these snags, was it going to have bad effects? Dr. Cohn agreed. They were seeing a number of snags and issues. Some they could help. Others they couldn’t. Still others had to do with how long it would take for the industry to come to consensus—if it could. While appreciating how the DSMOs expedited the process, Dr. Cohn noted consensus took time. They heard it would be a month, maybe longer. They also heard the need to expedite the government process.
Mr. Naninschen noted that with the NPRM the Administrative Procedures Act bound them. They had not been able to convince the Office of General Counsel that this situation met any of the exceptions to the administrative procedures act’s (APA) requirement for a proposed rule. Whether it was done in a notice of proposed rule making (NPRM) or final with comments, he emphasized what was critical was that the industry understood the proposed changes so they could change their implementation process. He said they hoped to publish the final rule in time so that the first set of standards would be the standards with addenda. According to the administrative simplification law, people had six months to implement any changes. And the Congress had 60 days to look at any rule that had major implications. A rule had to be effective by February 16, 2002 in order for this new set of changes to be implemented October 16. Mr. Naninschen suggested that, since DSMOs had already discussed the issues, the industry could probably take the issuance of an NPRM and the addenda as published as fairly good guides.
Ms. Ward doubted that the reality of implementation was on that time line. Speaking as someone who had been “out there for a year helping health plans implement,” she said it would be problematic. Even if they made those dates, people were doing this now and didn't want to wait until April. People weren’t going to make changes based on an NPRM--they would wait for a final. Dr. Cohn concurred. If something was problematic in an NPRM, “You didn't implement it.” Implementing and then pulling back could cost an organization tens of millions of dollars. But he noted this issue of short-term changes and notices was going to be part of life moving into the 21st Century. Could industry manage that or did they need to reflect on a different change cycle? Ms. Weiker observed that this was the first time many health plans and providers implemented these standards. People had to re-tool whole systems. They were replacing entire claims adjudicating systems, buying translators and talking to clearinghouses. Two years from now the infrastructure would be in place. They would only need to add or remove a data element.
Dr. Cohn noted this was an issue common to all HIPAA final rules. The Secretary wanted to telegraph to the industry upcoming changes with privacy, yet had to go through the process. One role for them to think about was if there is a need for a recommendation for an expedited procedure that ensured the process’s integrity. Mr. Blair asked if this was a dead issue they should accept, or was there an opportunity for a compelling argument? Mr. Naninschen replied that if there are experts available more familiar with the requirements of the APA who can explain why this situation meets one of the exceptions, they would be happy to listen. Dr. Braithwaite said clearly the logic was there: the reason for an NPRM was to make sure the public knew what was planned and could comment. The changes had already gone through an industry-wide consensus building process, at least as complete as what the NPRM would produce. The APA and the way the General Counsel interpreted it didn't foresee this process.
Dr. Zubeldia asked if adding a 61- or 62-day procedure to the consensus process would be beneficial to the industry. If the industry saw that the DSMOs had built through consensus and that the Department was committed to having the final rule within a week after the comment period, there would be few comments because everybody had agreed. Noting that the clock is reset once this amended rule comes out with the modifications from the DSMOs, he suggested considering a requirement that the Secretary not change the rule more than once per year. Mr. Naninschen said getting a final rule out within a week after the comment period closed wasn’t possible. He added that the standards could be changed at any time during their first year, if it is necessary to permit compliance to the standard. After that, the Secretary can change each individual standard no more frequently than once a year. Dr. Braithwaite said it was his impression that changes required for compliance and allowed in the first year were independent of that annual process. He would consult with their lawyers.
Ms. Weiker clarified when the DSMOs met, NUBC recommended that taxonomy, which is currently mandatory in the institutional guide, not be used. X12 and NUBC could not reach consensus, so the change request was designated category H to seek further information and some middle ground. She said X12 was gathering information on the category Hs. After X12 meets next week, there would be another steering committee meeting to address these H items. They would know then how many appeals there were and they could plan, meet, and get this done.
Asked if her preference would be for HHS to consider both As and Bs, if a final rule came out after October 16, Ms. Weiker noted that the implementation guides would have to be modified, placing another great burden on the volunteers in X12N. She cautioned the group to come up with a plan and stick with it. Category Bs and As would be appealed. Where there was a compelling argument, the collaborating DSMOs will agree to make the change. Ms. Ward agreed. That would place too much burden on the X12 work groups who had worked hard to get to this point. Dr. Zubeldia noted that any date later than October 16 didn't give anybody enough time to make the changes, much less test them. They had to have a firm resolution with clear indications without arguments as to what was approved by the DSMO and was moving forward. Anything with disagreements or appeals would have to be held back for future changes. Sending a clear signal that this is what the DSMOs have agreed and it is not going to change between now and the final rule was important. If the industry questioned that anything in the proposed rule could change, people would hold back, waiting for the final rule, achieving nothing with the fast track. Dr. Zubeldia said the DSMO could present the change requests agreed upon as the addenda published on the Web site with a cover letter.
Panel 1: Roundtable Discussion of DSMO Process and Results by Participants
Ms. Weiker reported that NCPDP opted in on 15 requests related directly to the NCPDP standards, the pharmacy services sector of the health care industry, or that contained a pharmacy component. The standardization and the maintenance and control co-chairs read and evaluated each request, referring them to the appropriate work group for discussion and recommendation. The director of standards development led the effort of tracking and posting the recommendation to the Web site. NCPDP’s internal process was not challenged since work group meetings were already scheduled. Input was provided to the work group co-chairs for requests involving X12N.
Ms. Weiker said NCPDP supports the development of and compliance with a set of guidelines regarding the review and opt in process. NCPDP believes there are flaws with the existing process (e.g., when an organization opts in on a request, then defers to another rather than provide a recommendation, NCPDP suggests it should withdraw as a CO on that request) that will be evaluated to determine if they exist in the overall process or are attributable to the fast track or the learning curve encountered by organizations and volunteers.
Ms. Weiker said guidelines should, at a minimum, include rules for opting in on a request, formulating an appropriate recommendation, and withdrawing from participation. All DSMOs should have an opportunity to review and provide comments on the guidelines and, once agreed upon, they should be implemented. NCPDP believes developing and following such guidelines will improve the process. With the number of change requests entered concerning the addition of code sets, NCPDP believes a relationship should be established with the currently designated code set maintainers to expedite these requests and gain additional background information.
Ms. Weiker noted the fast track process had considerable impact on the industry. Members of the DSMOs are primarily volunteers, and much time was spent reviewing and formulating responses to the requests. And the industry was confused over whether to stop assessments and remediation efforts and wait for the outcome of the process, or continue and evaluate at a later time. Stating there is no reason for fast track to be repeated, Ms. Weiker said NCPDP believes the normal DSMO process, as outlined in the MOU, will work well.
Ms. Ward pointed out that the testimony and discussions heard today were only relevant to the fast track process implemented in response to the Committee's request for help in addressing issues with the X12N HIPAA implementation guides. She recalled that the DSMOs were asked to develop a process to address the request for changes in an expedited manner. She emphasized the distinction between this fast track and the DSMO process outlined in the MOU or developed by each DSMO. And she noted the frustration expressed in the industry because of the significant work effort that went into addressing these requests in such a short time, and the belief by some that they may not have always made the best decisions. Ms. Ward emphasized that all this is tied directly to the “fast track,” not the normal DSMO process. The normal process, which has yet to run through a full cycle, completes its first batch of requests within the next months.
Most of HL7’s work went into reading and evaluating each request and determining those that will impact them. Ms. Ward reported only a few requests will affect HL7’s standard and their internal process has not been challenged as much as X12N’s. HL7 addressed a few relevant change requests with consensus. Responses to requests that involve X12N and HL7 were formulated in coordination with both the X12N work group and task group chairs. HL7 elected to opt in on requests concerning a need to include clinical/supporting information with the X12N 278 (pre-certification/preauthorization), and the request to develop an XML representation of the implementation guides. HL7 is actively working with X12N on the development of attachments for the pre-certification/preauthorization implementation guide to meet the need expressed by the industry for clinical information to accompany the 278.
Ms. Ward expressed HL7’s support for the development of and compliance with guidelines regarding the review and opt-in process. HL7 believes there were flaws in the existing process (e.g., DSMO's opting in on requests that do not affect their constituents, or opting in but not providing a recommendation) and was working with the steering committee chair to develop guidelines which, at a minimum, include rules for opting in on a request, formulating an appropriate recommendation, and withdrawing from participation. All DSMOs will have an opportunity to review and provide comment.
Ms. Ward said the DSMO steering committee was surprised and disappointed to hear, after all the preliminary work on the fast track requests was done, that the addenda identified will be subject to an NPRM. She noted that the DSMOs, at the subcommittee's request, undertook this task because they believed in the chance to make changes within the first year of implementation as described in the final rule for transactions and code sets. Implementing the fast track process had a definite impact on the industry, particularly each DSMO that had to review and consider the 231 requests. A significant number of people, in not only the standards bodies and data content committees, but also those implementing the transactions, set aside other tasks to attend to this monumental undertaking. Now with the NPRM, volunteers who took on large workloads to make this happen within this time frame wondered if this was futile. Volunteers were over-extended and productivity had diminished. Employers were less likely to so freely support time-consuming tasks they paid volunteers to do on company time. Ms. Ward suggested the lesson to be learned from the fast track was, whenever possible, be sensitive to making additional requests of industry volunteers without some level of assurance that HHS knows what the process will require on their part and can provide sufficient support to achieve the goal.
Ms. Ward noted that all parties at the February NCVHS meeting deemed this undertaking necessary and each DSMO rose to the challenge. The process allowed them to discuss consensus decisions of the respective DSMOs, debate the merits of many decisions, and ultimately arrive at a solution that will best support the needs of the health care industry. Ms. Ward commended the DSMOs and specifically the hundreds of hard-working volunteers for all they had accomplished.
HL7 welcomed the opportunity to work in accord with the original DSMO process described in the MOU. Ms. Ward said they would work with the DSMO steering committee to improve the process so DSMOs can consider all requests and formulate well-thought-out recommendations.
Mr. Landen clarified that, as an autonomous organization bound by its own internal rules and pursuant to accreditation by ANSI, X12 must follow ANSI-approved processes for development of its standards and the X12N Insurance Subcommittee must follow its internal procedures for the development, approval and modification of implementation guides. These internal requirements are woven into the obligations to support the DSMO process and abide by the DSMO MOU.
X12N's process for the DSMO change request included, first, information-gathering, discussions and recommendations at work and task group levels. Normal discussion, debate and research of the issues were severely constricted by the fast track process. X12N consolidated the recommendations into responses. Each change request usually affected only one work group within the health care task group. When work group lines crossed, recommendations were reconciled. HIPAA coordination management reviewed the work and task group recommendations for consistency and conformance with HIPAA guidelines specified by HCFA for the DSMO fast track process. X12N's representative discussed assumptions and concerns with the DSMO steering committee. Compromise and consensus were sought, but Mr. Landen noted neither compromise nor consensus equates to unanimity. Upon reaching DSMO consensus, X12N posed its technical solutions and posted them to an online public conference (www.wpc-edi.com/addenda--The X12N implementation guide handbook is posted on www.wpc-edi.com/transfer/handbook.pdf.) for the modifications and appealed items. Dissenting opinions continue to be heard through further iterations of public comments: e.g., X12N, WPC Web site, the NCVHS hearings and the public comment period after the NRM.
Once the public comment period closes June 1, X12N will review the comments, render its decisions about the addenda and prepare to vote approval of the addenda. X12N is deciding whether to hold its final vote in the June meeting or wait until after resolution of the 60-day public comment period, pursuant to the new HHS NPRM on the proposed changes. Voting now would give the industry “a solid target to shoot for,” but risk reopening guides after the NPRM's public comment period and re-approving and republishing. Instead, work might be finalized, but a final vote not conducted until X12N had benefited from the HHS public comment period, given advice about technical issues when consulted by HHS and HCFA staff, found a resolution to comments, and made subsequent modifications to the addenda.
X12N reviewed the change requests, identifying changes necessary for compliance with the regulation and those that could wait for the next version or maintenance to the implementation guides. In February, X12N approved a process for publication of addenda through already-published HIPAA implementation guides containing corrections. Corrections include both modifications and maintenance items. Only modifications must be sent through the DSMO change request system (CRS). X12N provided technical solutions for approved DSMO change requests, providing a feedback loop in time to verify that solutions satisfy the DSMO CO’s disposition recommendation. Based on the DSMO process, X12N included changes necessary for HIPAA compliance into addenda for each affected HIPAA implementation guide. Addenda are available for public comment on the WPC Web site. More than 75,000 e-mail notices were sent to list serves. X12N will hold informational forums at next week’s June trimester meeting for the addenda to be published for the HIPAA implementation guides. Addenda will be submitted to NCVHS as quickly as possible for inclusion in the HIPAA rulemaking process.
X12N has approved project proposals for the development of the next versions of the HIPAA implementation guides. Current regulations specify implementation in October 2002 of version 4010. X12 is considering versions 4040 or 4050 for the next round of HIPAA implementation. Guides might be available by February. Discussions begin at the June meeting about versions and time frames to recommend for the next HIPAA transaction set implementation guides.
Mr. Landen noted that some covered and affected entities have only begun looking closely at implementation guides. Their input will identify new gaps and problems—and resurrect long-settled debates over thorny issues. He cautioned that implementation of an October 16, 2002 implementation deadline, without sufficient lead-time, might prove fatal to many implementers.
He also noted X12N’s concern over the slowness of the federal rulemaking process and whether it will meet industry needs for timely changes to the standards that incorporate newly-identified business requirements and new technologies. He urged HHS to develop a fast track process of its own for rule making. Without it, he cautioned, there is concern that the health care industry will loss the opportunity to meet the final rule’s 12-month minimum timeline.
Mr. Landen identified other issues. Any changes (even if required for compliance with the regulation) received after the February 2001 cut-off date for the HIPAA implementation guides cannot be adopted until at least 12 months after the addenda’s effective date. There will be at least a year between versions of the guides and conflicts may exist between versions with addenda versus others without addenda, resulting in transaction interoperability and implementation cost issues. X12N is working on these issues. Mr. Landen reiterated that problems identified will be reported, but there will be neither time nor mechanisms to resolve them prior to the October 16, 2002 implementation date.
Mr. Landen complimented X12N members and their organizations for their volunteer work and pointed out the need to recognize the limits of their availability and utilize their expertise and knowledge wisely. He stated X12N does not want another fast track, but a consistent standard change process with an orderly, stable and predictable cycle, including health care industry consensus, for changes to HIPAA implementation guides.
X12N will continue to monitor and evaluate its process; X12N task group and work group co-chairs and members are being surveyed to determine where improvements are necessary. He encouraged HHS to develop a new rule for the next version of the HIPAA implementation guides. X12N hopes to complete a draft by February. Mr. Landen also said that HHS, DSMOs and the industry need to re-evaluate naming X12N implementation guides down to version, release, sub-release and publication date. Noting that the code sets are named and it is up to the code setting organization to apply their process for updating, he suggested naming the SSO and its currently published implementation specification (not to be published more frequently than once a year).
Dr. Suarez said the major benefit of the HIPAA DSMO change request process was the development of a single point of entry and a formal standardized format for maintenance requests. He noted the model is contingent on three elements: the ability to quickly deliver requests to all the DSMO participants, representatives and constituencies; the process of deliberation by all the committees; and coordination and consensus of the business needs for all users affected by the administrative transaction. Each DSMO, comprised of data content committees and SDOs representing industry segments is responsible for maintaining applicable data content and data conditions, as well as technical expertise and maintenance of the HIPAA implementation guides.
He said the overall HIPAA DSMO change request process confirmed that coordination is essential and thorough discussion among all potential transaction user groups is critical. The DSMOs worked cooperatively and coordination was outstanding. However, the fast track process resulted in several problems. The number of change requests confirmed that the “one size fits all” assumption might not be the most viable solution for all potential users. The process uncovered many implementation challenges, such as unresolved issues (e.g., local and NDC codes). And questions remain about code sets without guidelines for application in the final regulations that will be standardized, but may be interpreted differently. The DSMO change request process suggested flaws in the overall design of the targeted data capture: insufficient codes for elements or segments proposed to capture the data. The National Uniform Claim Committee (NUCC) proposed that things might be changed more easily with an external code set than going through the rule-making process.
Although the DSMOs reacted quickly in the fast track process, NUCC doubts another final rule for transactions and code sets will be published in a timely manner. Questions remain about delays in publishing regulations; the change in the administration and unfilled management positions at HCFA appear to be contributing factors. As more rules get delayed, implementation problems compound: e.g., the security, privacy, and transaction rules (which are all tied together) are essential for implementation of the other rules. Another problem challenging organizations is when and how much to budget for HIPAA activities. A recent Gartner group study found many organizations will not be able to comply with HIPAA implementation time lines.
Dr. Suarez reiterated the recommendation in NUCC’s original comments on the transaction NPRM that implementation of all the rules should be coordinated. Dr. Suarez said NUCC believes that the goal of administrative simplification should continue to be pursued and he suggested a need to focus on standardized content, rather than standardized method of transmission.
The NUCC believes the industry should test/pilot new transaction for modifications to existing standards before submitting them to the Secretary for inclusion as a national standard. Dr. Suarez emphasized the de facto standard approach: ascertaining that any proposed standards are out in the community and preferred nationally before adopting them.
Mr. Arges commended DSMO participants for quickly tackling important issues related to the HIPAA implementation guides on transaction standards. NUBC had expressed interest in reviewing 72 change requests. Volunteers convened conference calls, held an on-site meeting that included a co-chair from the X12N 837 work group, and solicited state UB committee input. Mr. Arges also participated in conference calls for the X12 work group and an ad hoc provider group formed to realize clarifications and corrections to the transaction standards and code sets initiated at the February NCVHS hearing.
One major area requiring attention was use of the National Drug Code. Last September, NUBC wrote HHS about problems with elimination of the HCPCS J codes in the institutional provider setting. Hospitals faced consequences if NDC was the only code set allowed for reporting drugs and biologics. Mr. Arges expressed appreciation for NCVHS’s recommendations to the Secretary that led to continuation of the HCPC J codes.
The DSMO steering committee met last month to present their respective organizations’ findings and recommendations. The data content committees largely carried forward their committee's recommendations. Each DSMO is expected to consult with its constituency, formulate and move forward consensus opinion, but Mr. Arges noted X12 representatives unilaterally changed their group’s recommendations.
The DSMOs charge was to correct errors, provide guidance and, where there was uncertainty, to ensure that necessary usage requirements are identified and appropriately in place. Corrections to the implementation guides and needed changes are held up, while three important change request issues are appealed: the National Drug Code, physician line item billing, and provider taxonomy code usage on the patient bill. Noting there is no time limit on the appeal process, Mr. Arges emphasized that DSMOs need to establish an appropriate time frame for resolution to avoid costly retooling for providers and payers.
The NDC issue institutional claim: The establishment of segment 2410 in the implementation guide still does not define for the provider instances requiring the NDC, allowing instead reporting of the NDC “whenever the service line item requires greater clarity.” Mr. Arges pointed out that providers reporting a HCPC J code and following up with NDC do not simplify billing process. He also noted most hospitals' charge systems can assign only one clinical code set per service: it would be impossible to indicate the exact NDC codes for compound or “cocktail” drugs. And he said situational usage items must take into account how information is an essential component to the adjudication of the claim, especially when other information is provided at the service line. Because the guide fails to provide specific business rules, NUBC urges that the reference to NDC and the new 2410 loop be removed from the institutional guide.
Item 128, physician information at the service line level: A request to remove industry usage requirements for the reporting of physician information at the service line was made for data elements in loops 2420-A, 2420-B, 2420-C and D. Currently, institutional providers do not report physician or other caregiver information at the line level. Having to comply with a set of requirements unnecessary for claims adjudication (even though the guide defines this as situational usage) involves enormous costs. Although some provider system software captures this information when patient care is rendered, less than six percent of these providers subscribe to this feature. Virtually no subscribers have the ability to interface this information with their billing record without costly redesign. Some state programs utilize level III HCPCs to capture similar information. The final rule on transaction standards was clear about eliminating level three HCPC (local) codes, suggesting they go through HCPC committees for possible assignment to HCPC level I or II codes. It did not condone level III HCPC codes for a new discrete data element. NUBC’s recommendation is to remove the loops of reference physician information at the service line.
Item 200, provider taxonomy: This item, linked to item 128, calls for inclusion of physician specialty on every institutional claim. These claims do not require identifying physician specialty. That assignment, an integral part of the national provider identification file, should be captured routinely in contracts that many health plans require providers to file. NUBC recommends removing this item from the institutional claim; claim adjudicators can obtain specialty through a national provider identifier (NPI) or in their own health plan files.
Other important related issues remain. References in the implementation guides to required use of external codes have caused confusion. Medicare and other government programs often call on short notice for establishment of new codes to meet congressional mandates. The NUBC's data set relies on codification of important health reporting requirements (and the UB's code set that includes value codes, condition codes, occurrence or occurrence span codes, and revenue codes) to meet these challenges without major disruption to the Medicare program. These specific code sets allow codification of new changes without reconfiguration of UB92’s fundamental construct. This design adds stability to information systems supporting development of UB92 and provides a return on the investment in billing information systems. Mr. Arges noted that today hospitals submit more than 98 percent of their Medicare claims electronically. NUBC asks NCVHS to recommend adoption of these external code sets as contained in the UB data set for use within the institutional transaction set for billing.
NUBC will ask NCVHS to consider business rules around the use of clinical code sets. These rules are important for “standardizing the standard” and ensuring the entire health care community understands their obligation to maintain and update changes to these code sets. In anticipation of the expiration next year of the moratorium to changes to the UB92 structure, NUBC is examining the UB code set. NUBC conducted a national survey of areas requiring change and is preparing for possible expansion of the clinical codes to recognize the eventual adoption of the ICD10 CM and ICD10 PCS. NUBC is also looking at adding information about the initial patient encounter.
NUBC recently tackled a persistent emergency room claims problem. Many claims required follow up because, on initial review, final diagnosis appeared out of line with resources delivered to patients. NUBC added a data element: the patient's reason-for-visit code, elaborating on events leading to the emergency visit. Subsequently, many managed-care companies reduced their medical review backlog by 40 percent and saved in staff resources. Providers minimized the need to provide additional medical record information and improved cash flow. And patients faced less administrative hassle explaining why they sought care outside their health plan.
NUBC plans further enhancements (e.g., expansion of external cause of injury codes and physician initial diagnosis) to provide more support for the claim and further improve administrative processing by avoiding costly medical necessity reviews. Realizing DSMOs need to work through unresolved issues, NUBC continues to support and research workable solutions.
Dr. Cohn acknowledged hearing a number of times that the expedited process was tough, and he expressed the Subcommittee’s and full NCVHS’ appreciation for a tremendous amount of high-quality work. Dr. Braithwaite remarked that, sitting in on meetings, he realized some of the conflicts and the personal effort expended to pull off this process. He assured that the process was not “totally dead” within HHS; all possible mechanisms were being explored to try to get a final rule out with these changes as quickly as possible.
Asked about the DSMO’s upcoming role in helping NCVHS identify requests that ought to be moved forward, Ms. Weiker noted that when the MOU was developed, the DSMOs had not anticipated reviewing additional code sets, something beyond their expertise. However the final rule on transactions and code sets charged them with looking at additional external code sets for inclusion. She noted the need to develop a relationship with code set maintainers. The home infusion coalition and alternative medicine group both submitted requests; in the final rule on transaction and code sets, HHS and HCFA looked at and found reason not to include home infusion. Requesters for the external code sets in the first round were asked to work first with existing code set maintainers and, if their needs weren’t met, to provide background to evaluate their requests. Ms. Weiker noted the Web site needed to ask requesters to confirm that the code set had gone to the HCPCS committee and explain why it was refused.
Mr. Arges reflected on the need to understand not just the code set but how it fit into a particular sector of the health care industry. He noted that, to some extent, home infusion served a specific purpose, though not in the same way as a HCPC or ICD code. But, as a marriage between a package reimbursement model and a clinical code set, it fit an industry need. The task was to identify how the industry felt comfortable representing the information.
Mr. Suarez raised the issue of a more efficient way of maintaining non-medical external code sets (e.g., the taxonomy code that NUCC is responsible for maintaining and the place of service codes and other external codes maintained by different agencies). Ms. Ward suggested the need might be to better articulate the process for each code set, rather than change the process. Mr. Landen observed that the simple pre-HIPAA answer to what ought to be in an external code set versus a situational data element used to be: the more volatile the code set and more frequently it changed, the more likely it was to be set up as an external code set. The code set was stable. The information was available in the implementation guide and the standard. And there was no worry about the slowness of changing versions. (Minimally a year for X12--longer for debated issues.) HIPAA changed that, introducing the element of situational usage and “turf issues.”
If the situation is defined in guides that go through the NPRM process, Mr. Landen noted clearly the situation and resolution have gone through the public comment process. Move that situational question out to an external code set and there is a control issue: Whose turf is it--the standards organization’s or the external coding committee’s? And did it go through the proper public comment period? Many code-setting organizations operate by their own rules and guidelines. Noting a shift toward more openness in order to participate in the spirit of HIPAA, Mr. Landen expressed confidence that they would come to a working resolution.
Mr. Arges pointed out the importance of keeping in mind the supporting information systems, at least on the institutional side, that lend support to maintaining information. Code sets have been a convenient way of simplifying information so it can be handled easier and is machine readable. Long before X12 health insurance, NUBC codified many of its data requirements as a convenient way of reporting key pieces of information that were part of the service. Mr. Arges suggested that many needs for attachments came about because people unwilling to work with the existing code sets asked for the answer to be “spoon fed,” adding to the administrative burden and process.
Ms. Weiker noted data elements expressed in the implementation guides are clearly identified in the HIPAA data dictionary. Some would argue that the volatility of some code sets maintained by external maintainers is dependent upon that code set group versus a broader, industry-wide consensus through DSMO and NPRM for changing data elements. And she pointed out that situational data elements in the implementation guides direct implementers on when and how they are used. Dr. Zubeldia cautioned there was a risk in defining all those situations in the code sets. Several commenters had mentioned a lack of publicly known due process for the development of the code sets. If the code set is not just codes, but also situations and business rules built into a code set, that code set maintainer, in fact, becomes an SDO not accredited by ANSI. Was it feasible that those code set maintainers could become ANSI accredited and maintain the code set with rules in them, going through a process similar to the standards themselves?
Dr. McDonald separated out different things he was hearing. Code sets that have business rules in them are more complicated. Dealing with big code sets, like a dictionary, is hard to do by consensus--Samuel Johnson would never have succeeded if he had had to use a consensus process. He suggested that the code sets are excluded from the ANSI process because of that insight. But he noted a gray zone: beyond those codes were business rules and that was another issue.
Noting the large quantity of paper claims still converted into electronic format, Mr. Arges said a benefit of having the external code sets he listed in his testimony was that they could aid in logically transferring scanned information to particular areas. He clarified that a value code represents a particular measurement or value. Dr. McDonald observed that quite different categories of issues come up trying to make a broadly mergible standard when new variables are linearly tossed in. Noting that in some places in the spreadsheet of request changes birth weight was considered using value code and in others (X12) it was a field, Dr. Cohn questioned where the dividing line was and what made sense. Ms. Weiker said the recommendation changed to a value code in the institutional claim form; the 837 professional didn't have a field with the specific value code. That was why there was a difference with the professional and the institutional guide. All those codes applicable to institutional claims in UB92 hard copy paper (value codes condition codes, occurrence span and revenue codes) weren't used in the professional world. In the professional guide a data element identifies that data. Mr. Arges commented that at some point the NUCC committee discussed revamping the 1500 to codify some of those elements, rather than constantly redesign the electronic to accommodate new reporting requirements.
Dr. Zubeldia remarked that it seemed the demarcation being made was if the value code or codified element was part of the standard flat file format, UB92, or 1500NSF it would be codified as it is today and continue that way. He suggested instead the demarcation might be: X12 if the code or value belongs in more than one transaction, value code if it only belongs in one. He noted that the total amount of the claim is a value that can be expressed either as an X12 data element or a revenue code in the UB92. There is no equivalent in the new code in the 1500NSF type. The 837 professional is going to be used as an X12 data element. The 835 will carry it back as an external element. The 837 institutional can do it either as a revenue code 0001, or as an external element. In cases like that, Dr. Zubeldia suggested it might be easier for the processors to make it X12 for all transactions involved. Ms. Ward noted that was already a change request. Request item 126 was to remove the data element in the institutional guide and mark it not used. The X12, NUBC and NUCC opted in and decided for consistency usage to leave it as it was. Mr. Arges added that principle was raised at the NUBC meeting. He thought it probably would be fairly workable. Overlaps in the revenue codes would have to be pulled and handled separately, but the value, condition, and occurrence codes were discrete.
Ms. Greenberg remarked it was important that users be able to go to a data dictionary and find out the content. Information about certain value codes being used in lieu of a data element was not in the data dictionary. Mr. Arges noted mostly systems information people, not the business office people who had to collect and understand this information, read these implementation guides. Ms. Greenberg clarified that X12 and HL7 were putting their data into the meta data registry; NUBC and NUCC were not. Dr. McDonald called it an intrinsic, impossible problem. “You won't find a single field for ampicillin in a pharmacy system.” There is no regularity or rules and nobody knows where to look. Sneaking in data structure ad hoc by making them codes is the problem. There should be a data dictionary and vocabulary specifications, with categorizations so you can guess where to look.
Mr. Moertel noted he chaired the task group in NCX12N that produced the HIPAA data dictionary that contains some of the codes associated with the HIPAA transactions. He said the HIPAA data dictionary was developed to contain the data elements listed separately in the implementation guides and did not contain either internal or external code sets. (Things like baby birth weights show up because the guides were originally condensed, then flattened. Whenever there was a segment with multiple codes, they took the iterations of the loop so each loop had the code set identifying what the loop was. A loop identified as baby birth weight became a discrete data element.) Mr. Moertel agreed with Dr. McDonald: trying to define all the codes within the HIPAA data dictionary was a complicated process that would not happen soon. He noted another issue with some of the value codes was that they are not new codes created for HIPAA. Hospitals have used value and occurrence codes for 20 years. The percentage of electronic claims submitted in the hospital environment is extremely higher than in the professional environment because of those code sets. He said NUBC had been responsible and diligent in maintaining them.
Dr. Braithwaite noted NUCC’s contention that any proposed standard should be out in the community and preferred for national use before it was adopted as a national standard. He said that sounded like reverting to pre-HIPAA, where nothing was a standard unless it was already in use by everybody--which never happened and never will. Mr. Moertel clarified that NUCC’s point was that the standard named into the rules, 4010 October or May of 2000, had been tested by the SDO, but never put into place in the industry. X12N actually released them as draft standard for trial use and they stayed in that mode about three years, then became official standards. Mr. Moertel emphasized the responsibility when recommending national standards to make sure those standards have been tested and used by the industry. Ms. Ward agreed. They had been unable to do it for years. Hence, HIPAA. Now, even with the final rule, a sector of the industry asked for more years because they “didn't have enough time.” She concurred with Dr. Suarez: people who did not want to implement what was put in front of them with the final rule would not step up to test a new one before a rule was issued.
Mr. Landen reflected that health care, while the largest single component of the US GDP, to a large extent was also a cottage industry that had never embraced standards. X12 found in many forums that, no matter which experts are gathered, the field is so diverse, with each segment having its own business needs and idiosyncratic real-world requirements, that never is there all the information needed to make that perfect decision that works optimally for everyone. People referred to NSF as “national similar format.” Around that standard core, trading partners deviate. The Federal or state programs, for the most part, have their foundation in legislation and rules by regulation. All the private sector’s rules are based on contract law. The equivalent in implementation guides have references “as required by Medicare,” “as defined by your state SUBC,” “as required by contract.” On top of that is a fluid “lubricant” level allowing the standard to be tailored for particular industry sub-segment use, leeway for trading partners to create their own ways of codifying special information that normally the payer requires to adjudicate that claim pursuant to its contract, generally with an employer. Those lubricant layers allowing local flexibility and trading partner-specific flexibility are gone. Mr. Landen cautioned not to take for granted comments made about how well NUBC and its codes or NUCC and the 1500 served the industry. Everyone was now in an environment lacking voluntary compliance and no one any longer had that ability to deviate from the black and white norm. He said this was an issue the industry had “to toddle through in its learning curve” implementing these HIPAA mandates.
Asked how NCVHS could know when they were hearing part of the majority, Ms. Ward said categorize them. Dr. Braithwaite said get the experts in the room and take a best guess.
Mr. Moertel summarized early experiences with HIPAA implementation that he first reported at the February hearings, explaining how Mayo created a compliance effort that reviewed implementation guides. The team created a gap analysis, comparing data available electronically with data contained in the HIPAA transactions. Finding a large number of new data requirements, they determined extensive infrastructure changes were required for compliance. Representatives from provider organizations and associations and HCFA evaluated their analysis and determined that the gaps identified were common issues for the provider industry.
Mr. Moertel’s testimony also addressed the issue of universal business need. The provider group questioned whether newly required data elements reflected an industry need or the preference of a few payers or state agencies. A provider is now obligated to provide all required data elements on all claims to all payers, even if none of the provider's business partners need those data elements. Payers who don't need the element for processing must maintain it to pass it back on a remittance advice or on to a secondary payer as part of the COB process. Seeking administrative simplification, the providers believed elements not currently necessary for billing services should not be required for HIPAA implementation. The HIPAA 837 implementation guides were developed for reporting claims services from providers to payers: elements included to fulfill other needs (e.g., state public health reporting) should not have to be reported on the claims transaction. The provider group supported utilizing the 837 standard as the transaction to report data for public health purposes, but proposed that a separate implementation guide be developed for those needs. Oftentimes, other more widely accepted methods captured the same information. For administrative simplification and health data standards addressed by the HIPAA act to succeed, the group believed that some of the data elements in question were going to require compromise.
Following NCVHS’s recommendation, Mr. Moertel entered 46 claim issues for the provider work group plus six remittance and eligibility issues on the DSMO site. X12N opted in on all 52 issues. Mr. Moertel said only two requests have been honored. One resulted in a change. Three are under appeal. He was told that up to five more might be handled as maintenance.
Noting that providers are among the most under-represented groups at NCX12N, Mr. Moertel said having only two out of 52 issues resolved was not an uncommon result. He suggested that was why a number of providers and provider organizations had been driven from the process. The work group had accepted twenty-six of the 46 claim issues for changes. Mr. Moertel reported these changes were not voted down at the DSMO meeting, but changed prior to that meeting by three people from the X12N management team--two vendors and a payer.
Issues accepted as additions to an addendum to the guide had gone out for a 30-day comment period that ended that day. The right to appeal was supposed to be open to the original submitter of the issue, but Mr. Moertel said that also was restricted. A note on the Web site, read: “X12N asks that you please keep this discussion relative to the implementation guide changes proposed in the attached PDF file. Only the pages that contain changes are included. Please do not post new topics to this discussion. Any new topics will be removed.” He added that the appeal process for the DSMO group had not opened; yet five issues appealed by one of the three people who changed the decisions were already listed. Mr. Moertel noted he followed the Subcommittee’s advice, but there was a substantial breakdown in the process.
Ms. Klein detailed how Medicaid agencies are challenged by the transition to HIPAA. Many services Medicaid performs or funds are unique. Medicaid has created numerous proprietary reporting mechanisms to comply with federal reporting requirements and fulfill its obligation as stewards of taxpayer dollars. She said the challenge was to crosswalk data elements (e.g., provider specialty, provider type and thousands of local codes and unique provider identifiers) into the standards available in the 4010 transactions without impacting client services or compromising the Medicaid-provider relationship. Ms. Klein said Medicaid had believed the DSMO process provided an opportunity to continually improve work done years ago in creating the 4010 transactions—but was not prepared for the full scale assault on significant data elements within those transactions. The fast track process impacted Medicaid agencies in multiple ways.
c.While Medicaid’s impact assessments and gap analyses continue, programming for conversion is on hold. And the local codes subworkgroup petitioning for new HCPCS codes has been brought to a standstill.
d.All crosswalking and implementation processes in the states remains on hold because of the uncertainty of the outcome of the DSMO fast track process. Several critical DSMO requests remain in the appeal process and may not be decided until later this year. Some decisions of the steering committee remain unclear. It is not possible to understand whether a change request has been approved, is under appeal, or should be appealed.
e.Medicaid agencies utilized the DSMO fast track process to request a change allowing post-payment recovery from liable third-party payers. Medicaid is mandated to conduct this pay and chase and, without the change, stands to lose about $500 million each year. The steering committee’s favorable decision, posted to the WPC Web site, was reversed--and it is not clear how (or with whom) to appeal.
f.The fast track process seems to run counter to the MOU that calls for timely review and commitment to open public access. The appeals process is confusing and seems to imply that an approved change request that completely altered the standard data set could not be appealed at the DSMO level by an entity drastically affected by the change.
g.The data standards modifications require another rule-making process, but there is no way to determine when that process begins or to gauge the final outcome. Another extensive DSMO process could begin all over again with new versions.
h.The fast track process kept Medicaid agencies at a frenzied pace for three months gathering data to substantiate positions on critical data elements supporting business needs. Much of this business is unique, but Medicaid continually encountered the argument that, unless all payers needed a data element, it was not necessary in the transaction. Had there been time and opportunity to work collaboratively, agencies might have been able to research the profound implications of such drastic data changes and develop viable solutions.
The fast track DSMO process required Medicaid to rapidly assess systems and business operations and may have jump-started HIPAA activities. Ms. Klein said few processes had served so well to unify Medicaid agencies, solidify partnerships at a federal level, and build alliances with other agencies, public and private, sharing a mission to improve the country’s health.
Ms. Klein offered recommendations to improve the DSMO process. She advised that all significant rules for administrative simplification should be finalized before covered entities are expected to begin compliance. States have limited budgets to invest in systems changes and cannot continue to request funding for reprogramming. The fast track process has taught agencies that they cannot assume that standards are final. Compliance would likely take two years, once the rules became final, and there was a solid foundation upon which to base transition efforts.
She noted that organizations that comprise the DSMO MOU are well suited to advise NCVHS when it is time to move forward with a new HIPAA standard. And she proposed using the DSMO process as a conduit to inform SDOs of changes necessary to improve the data quality. Each SDO has processes in place to evolve and improve the standards and new versions that are public, collaborative, progressive—and well suited to the development of quality standards. New standards should not be named in rule until pilot projects confirm they improve health care processes and can be implemented without enormous system changes for providers and payers. Once the industry develops a standard, its data content should be final until another standard is named. Standard data content should not be eroded before implementation demonstrates its value.
Mr. Landen testified for six individual Blue Cross Blue Shield plan employees who had submitted change requests through the DSMO process. Joanne Weingarth of the Empire Blue Cross Blue Shield Plan submitted 10 change requests. Her written testimony noted that submitters were not asked to participate in the DSMO discussions and the DSMO Web site did not provide the status of change requests submitted. What information she did receive on the status of requests came through list serves, but she was still uncertain if these decisions were final and felt she probably wouldn’t know until the final rule.
Ms. Weingarth commented that entry of change requests was simple via the DSMO Web site, and that it was good to be able to see the requests the industry submitted. But she noted the industry as a whole may not understand the change request process and suggested that the DSMO Web site should be made more user friendly: the search feature should be able to search by a specific change number and one should be able to print all requests without having to select each individually. She suggested indicating the resolution of each request: e.g., all requests included in a specific implementation or all those accepted for the fast track.
She noted the percentage of changes actually considered for the version 4010 X12 implementation guides seemed small: about 15 percent of the 231 change requests became category As. Major concerns such as the number of service lines supported and the maximum field sizes were not changed. Ms. Weingarth expressed concern about the fast track and the amount of thought and investigation given each request. She observed that change requests that will be considered for the next round of HIPAA could take considerable time to implement and questioned whether they would have significant impact on improving implementation or would even still be required.
Mr. Landen said the six Blue request submitters polled were typical of the user experience. They knew where to go to submit their requests, but once the request was submitted, there was not the responsiveness they expected. As one of the architects of the DSMO process, Mr. Landen agreed. The DSMOs’ priority when building this system had been the simplicity of having a single specific place to submit the requests. They achieved that. But, working on the MOU, everyone had also talked a lot about feedback to requestors. The intense time demand of the fast track process and the cost of a Web site (The site was funded by the six DSMO organizations with some ongoing maintenance dollars contributed by WEDI) eroded those communications.
Ms. Schulten discussed ASPIRE, a transaction gap analysis and demonstration project to gauge if a HCFA 1500 paper claim form contains all necessary and required data for creating a HIPAA compliant version 4010 837 professional claim. The demonstration, requested by NUCC, involves participants from provider, payer, clearinghouse and vendor communities.
The UB or HCFA 1450 contains a subset of data present in the 837I transaction and data not found in that form. The HCFA 1500 paper claim form contains a subset of data in the 837 professional transaction as well as other data not on the 837P and can be turned into an electronic print image. In a provider's office, paper claim forms can be filled in by hand, typed, or generated from data entry from a practice management system flat file or scanning.
ASPIRE identified four categories of gaps between the data: gaps between mandatory data content (data not physically on the form required in the electronic version: e.g., provider taxonomy codes and payer responsibility sequence codes), specificity gaps, ambiguity within data element crosswalks, and non-standard use of the paper claim format. Once ASPIRE determined categories of gaps, participants developed work-arounds and other solutions: development of precise implementation guides for the paper claims, industry-wide accepted crosswalks, trading partner agreements, and data enrichment.
The HCFA 1500 claim form has 33 numbered boxes representing some 150 discrete data elements. The NSF 2.0 electronic claim has 25 records (AAO -- ZAO) representing 582 discrete data elements. The 837 professional institutional has 244 segments (ISA -- the IEA) representing about 1,054 elements in a fully completed 837 claim. A large percentage of those elements are qualifiers (e.g., how a patient's name is represented in X12), not discrete data elements.
One issue with data specificity is that the 837 professional makes clear distinctions between bill to, pay to and rendering providers while the HCFA 1500 does not. The NM1 segments require the distinction between individual and organizational data types.
An example of ambiguity within data content crosswalks is that the 837 professional lists 25 different relationships to insured, but the HCFA 1500 provides only a check box to indicate self, spouse, child or other. The HCFA 1500 and 1450 paper claim formats contain fields that can be used for a variety of non-standard purposes. The first line on the back of the HCFA 1500 form reads, “Because this form is used by various government and private health programs, see separate instructions issued by applicable programs.” Box 19, has a statement, “reserve for local use.” A variety of data (CLIA numbers, mammography numbers, procedure descriptors) can reside in these fields. The UB92 field two is an untitled field assigned for use by each individual state.
Ms. Schulten noted a precise implementation guide identifies exactly how the form is filled out, eliminating issues in mapping to the electronic version. Utah Health Information Network (UHIN) provides instructions (e.g., “Box 25 of the HCFA 1500 can only contain the pay-to-provider tax ID”) to their trading partners.
With publication of the final HIPAA transaction implementation guides, WEDI SNIP’s translation work group is developing gap analyses and transaction crosswalks and SNIP translations and business issues work groups are writing a white paper. Ms. Schulten noted the opportunity to share crosswalks industry-wide and provide best practices to aid in their development. Detailed trading partner agreements between the provider and clearinghouse can alleviate data content gaps. A taxonomy code cross reference list could exist for each provider submitting to the clearinghouse and providers can define what data will reside in “local use” fields. Data enrichment is another possibility. Practice management vendors can assist providers by augmenting the data present on the paper claim form. Instead of placing an X in box one of the HCFA form to indicate the claim type, a 1, 2 or 3 can indicate both claim type and payer sequence. The ASPIRE work sheets and gap analysis are posted on the AFEHCT Web site (AFEHCT.org).
Ms. Weiker responded that all of Mr. Moertel’s requests were reviewed by the DSMO in a consensus-building fashion. All the organizations agreed on the categorization and priority of requests. Mr. Landen pointed out that change requests categorized as Bs were not considered critical enough for category A and reserved for the next round. They would be considered in the standard development process for the next version of the HIPAA guide.
Ms. Weiker said the comment about the provider community being under-represented at X12 was a fair statement. But she noted six groups make up the DSMO. The NUBC, NUCC, and the dental contact committee had represented the provider community, though they might not have been present when requests were categorized. She said there had been some give and take by the representatives of X12N management during discussions with the other DSMOs as part of the consensus building process. And she noted hearing throughout the testimony confusion about the WPC, the DSMO, and X12N Web sites. Ms. Ward said what was on the X12N Web site had nothing to do with the appeals process. Ms. Weiker said the site contained the technical analysis of the category As and items the X12N management team said they would appeal. She said labeling them appeal on the addenda Web site might not have been quite the right verbiage, since they had not been officially appealed--But Gary Beatty, X12N chair, had said he would file an appeal. She said he gathered further industry input and put it out on the Web site. Ms. Weiker said X12N did not post new topics in an effort to keep the discussion germane. She reiterated that the DSMO site was now fully functional and had the results for all the requests. All categorizations and the final comment from the DSMO are posted. A requester or a collaborative DSMO organization could file an appeal on the site. Categories had been updated and listed. A notification that the DSMO business analysis has been posted will be sent to each requester. It will tell where to go to see it, how to file an appeal, and give the time line.
Dr. Cohn noted that four A category (priority changes) were accepted. There are eight Bs. Some 13 Cs (maintenance) were accepted. There were 24 Ds (rejections, no changes). Two Fs (withdrawns) and two Hs (further evaluation). About 17 change requests appeared to make it through this initial process.
Dr. McDonald remarked that this was a tremendous amount of work for volunteers—and hard to do without faces talking to each other. Requesters were expected to give justification and explanation. One could get that face to face, but, with this level of complexity, couldn’t assume getting it from an automated process. Mr. Moertel explained the point he tried to emphasize in his testimony was not that he felt the DSMO process was broken, but that there was an issue with X12N and representation. The first half started as a debate; the second half turned into a dialogue. As an industry, they succeeded in coming to a solution that required compromise. Issues that came out of the work group were the result of an industry agreement. The change took place after the work group’s consensus. The management team changed the outcome before it went to the DSMO group. Not only did the outcome change, the discussions at the DSMO group were not representing the constituents of X12. That was the issue.
Mr. Landen stressed X12N management felt comfortable with their decisions to modify some of the work group’s recommendations: as managers, they were more in tune with changing parameters and acting any other way would have been a greater disservice in representing X12N and the DSMO process. Many requests were just a sentence or two, at most a paragraph. Mr. Landen said when the six organizations negotiated the MOU, they drafted a screen for the change request: “What is your change? Why do you need it? Why is this a national compelling interest, as opposed to just a need of your organization?” They hadn't gotten to that level of detail on the Web site because of budget constraints. A combination of factors (lack of information, the rushed time period, changing external demands) created a situation where management had to act and did. If they acted improperly, they would find that out when they met next week. Mr. Landen said he looked forward to that discussion as part of the quality improvement process.
Responding to Mr., Landen’s statement about the need for detailed information and clarity on change requests so that the steering committee could understand what the requester wanted, Ms. Ward noted that while X12 hadn't yet gotten down to that level of detail on their Web site, HL7 and NCPDP had. They had anticipated confusion with their claims attachments and the need to hold requesters responsible for what they asked. People began filling out questionnaires on the Web site, realized they didn't have the answers and withdrew to do their homework before coming back. She said HL7 had offered that questionnaire to X12 to modify to fit their needs. Mr. Arges said he participated in provider and X12 calls and knew the frustration Mr. Moertel experienced. They went into the final DSMO meeting assuming they were looking at everybody's position. As representatives, they carried forward the recommendations of their respective committees. It was somewhat surprising to see some of the X12 positions change at the last minute. It created frustration and doubt about who spoke on behalf of X12.
Ms. Ward commented on a particular request related to Medicaid and the pay and chase that had been approved and moved forward by the steering committee, then reversed. HCFA made that determination; the reversal had nothing to do with the DSMO process. Ms. Trudel explained the assessment was based on a definition of the various transactions involved and whether this business functionality fell into the purview of a claim and remittance advice CCOB. Ms. Weiker said X12N posted that information while they were still going through change requests. They had recategorized it and updated the Web site. Ms. Klein replied that the DSMO site hadn't been available. The only Web site they had access to was the WPC site. The process had been confusing for everyone.
Ms. Ward referred back to HL7's opening statement, cautioning everyone not to confuse the DSMO MOU process with fast track. People were saying fast track ran counter to the MOU. She pointed out that that process wasn't what they had set forth to do in the MOU. The fast track was modeled on the existing process, but it was separate and distinct. They did not want the industry thinking MOU and the DSMO process did not work.
Dr. McDonald said he had the impression from the last testimony that the fast track was almost solely dedicated to getting rid of requests. He said he might have hallucinated, but it seemed an attempt to make this first pass simpler. And he suggested anyone might need to complain. If someone asked for something and didn't get it, they might need to complain. And if they did get it, everyone else might complain. He questioned whether they were leaving out complainants. Ms. Weiker assured him they had plenty. But, at this point, she said only the requester or a collaborating organization could appeal. The MOU was written that way. She said all that would be done in the NPRM process. She suggested it also had already happened: the expectation was that each of the six DSMOs brought all its constituent's positions to their discussions.
Dr. Cohn thanked the DSMOs for taking on the fast track process. It was not perfect, but his own view, listening to the testimony, was that most problems they heard would be common to most any first-time process. The Subcommittee put the DSMOs under pressure, but Dr. Cohn said he didn’t hear that it was a lot different than if they had taken a whole year. Instead, it was the beginning of June rather than next year. He said the DSMOs should congratulate themselves.
Mr. Gilligan said AFEHCT member companies, which provide electronic data interchange (EDI)/e-commerce/internet infrastructure to the industry, fully support administrative simplification provisions including the privacy regulation. He cited the Tillinghast-Towers Perrin study, commissioned by Blue Cross, which indicated in November (weeks after regulations became effective), that virtually no hospitals had carefully considered implications of HIPAA. Other studies appear more positive, but the only one using a statistically valid, ratified, random sample of providers, the Gartner study, concluded in May that unless health care organizations substantially boosted compliance, most would not meet the October deadline. Mr. Gilligan suggested Blue Cross Blue Shield Association (BCBSA) might have created a self-fulfilling prophecy, as many providers “wait and see” if the Blue’s campaign is successful. Gartner linked the community’s wait-and-see approach with language indicating the final rule could be withdrawn if the privacy rule was not published timely.
Mr. Gilligan noted that Gartner advocated only an effective one-year delay achieved through flexibility in enforcement. AFEHCT opposes tying all the regulations together. Proponents of the S.836 proposal say they need to see everything they are required to comply with in one package so they avoid multiple systems upgrades. But Mr. Gilligan pointed out that the transactions and other administrative simplification standards have to be implemented in an environment of constant change. Medicare is about to change its prospective payment system, triggering changes to hospital systems. HHS will modify the transaction standards and there will be changes to the implementation guides. Providers will have to adjust systems to accommodate security and privacy laws enacted by the states. The administrative simplification statute, itself, provides for changes taking place on a rather frequent basis.
The S.836 ties going forward with the transaction standards and administrative simplification to achieving speedy consensus and good faith on all the remaining standards and the enforcement regulations yet to be seen in proposed form. Mr. Gilligan questioned what happens if all the regulations don’t come out. If there is no agreement on the attachments proposal? If someone argues the security final rule or takes issue with the enforcement standards? Mr. Gilligan said “a swarm of HIPAA agents” wouldn’t go after people not in compliance. There was no funding in HIPAA for that. In all likelihood, the transactions’ final rules would not yet be published.
AFEHCT maintains that some clearinghouses are already to support claims and remittance advice that are part of their core business. All clearinghouses that responded to The Phoenix Health System study reported they would be ready to transmit all HIPAA compliant transactions 12 to 18 months before the transaction compliance deadline.
Mr. Gilligan noted some sensitivity on Capitol Hill that people will not be able to make an October deadline. He recommended that the timing of compliance should create a soft-landing approach. Those who deployed resources to implement HIPAA should not be penalized, wait-and-seers and others upgrading systems needed an opportunity to comply. He suggested such flexibility could be achieved by amending one word in section 1176: changing “the Secretary shall” to “the Secretary may impose a penalty.”
Mr. Reynolds stated he was speaking for Blue Cross and Blue Shield of North Carolina (BCBSNC) and BCBSA, not NCHICA. Over 24 years, BCBSNC instituted electronic transaction standards resulting in 90 percent automation of hospital plans and 67 percent of physician claims, including crossovers from Medicare Part B. Mr. Reynolds mentioned a session for over 300 attendees the Blues held in March going over details of HIPAA and noted volunteers drove the industry. They were doing a wonderful job, but this was not the normal regulation process.
He asked everyone to remember Mr. Moertel’s face when he walked out of the room: whether or not he agreed with the opinions, he and the entities he met with had to figure out, from a business standpoint, what they had to do with the answers. Mr. Reynolds assured that, when answers were clearly defined, they could do business. That was not a situation that had to do with ANSI, but with the reality of people trying to figure ways to offer health care to their employees. They had to figure a way to let the GMs, the Fords, the University of North Carolina cover their people the way they wanted. BCBSNC had 15,000 providers in North Carolina. Mr. Reynolds said they all have to work on these answers; or they wouldn't get there together.
Noting the Blues had long supported simplification, Mr. Reynolds said he appreciated the scope of the work ahead. HIPAA touched every aspect of their business and every partner. Nationally, there were 2.6 million health plans. Some 5,134 hospitals, 701,000 physicians, 353,000 other providers and employers had to implement changes if they were to transfer data electronically. Multiply that sum by eight transactions—that was the state of readiness required.
Addressing the elimination of local codes, Mr. Reynolds observed that with the Dukes and the University of North Carolinas and others doing different things on an ongoing basis, to take care of customers they had to continually deal with things outside the norm in a way that made everybody satisfied. But he said it was really immaterial whether local codes were put in national codes. Again, what mattered was having an answer. Could they crosswalk--Use a clearinghouse? What did a clear answer mean to the business rules the local codes included?
Mr. Reynolds said he was excited about the DSMO process. As they heard, Medicaid was dealing with the same thing. The DSMO needed to get more volunteers and they needed to get ready. Every day more issues were uncovered and had to be addressed. The Blues and their business partners struggled with the current piecemeal approach to implementation. HIPAA was going to become people’s business plan. Anybody in any sector had a problem when there was a government regulation the size of this one. If people continued to wait and this date was kept, chaos would reduce the quality of health care administration.
Responding to comments he’d heard that a reason the Blues didn't want more automation was that they didn't want to pay, Mr. Reynolds said most Blues now use a pharmacy benefits management company. People pay their co-pay and the Blues immediately get charged. North Carolina has prompt pay legislation going into effect that will place significant penalty if they don't pay faster. Mr. Reynolds said BCBSNC was trying to add prompt payment on HIPAA-ready transactions to that legislation.
He noted eleven hospitals in North Carolina would go out of business this year. He said rural hospitals’ margins were gone because of the balance budget act HCFA enacted. Their ability to generate revenue for large projects was limited. He asserted compliance costs for health plans estimated at about a million dollars were grossly underestimated. BCBSNC spent $750,000 last year, and had an approved budget of $6 million this year.
Many providers and health plans, unaware of the sizeable costs associated with administrative simplification, did not adequately budget and would not be ready for October, 2002. Mr. Gilligan said he asked representatives of 73 hospitals attending a presentation to the North Carolina Hospital Association how many had a budget in 2001—One hand went up. He cautioned a lot of small rural providers and doctors were not “awake” and said he was certain providers in North Carolina would not be ready by 2002. Many were unaware of the significant new data requirements. Success depended on universal compliance, but he would be forced to run a system taking in and processing paper with old codes, identifiers and fields--A continual reminder the provider didn't have to change. Band aid solutions exacerbate costs. One Blue plan was spending over $60 million on wrap-around. BCBSNC’s legacy system, which could not take and map the 837 to the 835, was being retired. It would take 90,000 vendor programming hours to change systems; software would be available next April. Mr. Gilligan cautioned to ask vendors when they could truly deliver and what testing had been done. Mr. Reynolds said 200 of BCBSNC’s 285 vendors would be affected by HIPAA. He had met with 12 of the top 15; they were not ready.
Responding to Mr. Gilligan’s query about why the Blue's hadn't changed, Mr. Reynolds replied that executive staffs and systems had changed dramatically. He said the Blues supported administrative simplification and were dedicated to its implementation. He would spend $6 million this year regardless of the decisions; they had to know clearly that everything was ready.
Stating there probably was not sufficient time for medical practices beginning to test their electronic claims system or with limited resources to meet the October 2002 deadline, Mr. Tennant said MGMA supports a compliance extension of a minimum of 12 months. He noted uncertainty regarding when regulations will be finalized and when group practices will be required to submit HIPAA compliant electronic claims. As they heard, many medical practice administrators had adopted a “wait and see” attitude, not yet confident with adopting the HIPAA standards.
Mr. Tennant expressed concern that there is little incentive for group practices to expeditiously upgrade billing and patient records software to comply, since, until the compliance date, health plans can refuse to accept and adjudicate claims submitted using the standard format. MGMA encourages plans to enter into trading partner agreements with provider clients, establishing testing schedules and timetables for when plans will be able to begin accepting standard claims.
While MGMA supports providing additional time for compliance, it contends that a delay with no fixed compliance date is counterproductive to the overall goal of administrative simplification. Anticipating that HIPAA regulations would be released promptly and as a “package,” MGMA believed compliance for all the administrative simplification standards should not be required until all the final rules were published. Noting it was now apparent that the rules would be released in a staggered manner, Mr. Tennant said MGMA proposed implementation structured in four stages. Stage one would fully implement the transaction and code set standards by October 2003, allowing an additional year for covered entities to prepare their systems. Stage two would include release of health care identifiers with compliance occurring two years after publication of each final rule. The third stage would fully implement standards for privacy and security two years after publication of the security final rule. The final implementation stage would include standards for electronic claim attachments and enforcement.
Mr. Tennant concurred with Mr. Gilligan that a fixed starting point with all standards in place and static for a length of time is not in the nature of the standards developing process or necessary to upgrade practice management systems to handle the HIPAA standards. MGMA believes the standards can be successfully implemented in a staggered fashion and that a substantial delay in implementation would delay many benefits of HIPAA stemming from the transaction standard.
Mr. Tennant identified three critical implementation concerns for group practices. Cost to transition to the new standards will vary depending on size, complexity, level of technical sophistication, and the transaction standards a group practice adopt. Noting that many group practices are migrating to the new 837 and 835 standards, he emphasized there is no reason to delay moving in that direction. Providers are concerned that the implementation process for electronic transactions will move faster than the corresponding forms (especially paper) can be modified. The NUCC HCFA 1500 Subcommittee is developing prototype forms. Providers are also concerned that fines for non-compliance will be levied prior to full implementation and testing of all electronic transaction standards.
MGMA was supportive of the development and use of national standards in the industry. Confident that HIPAA will be an asset to group practices, lowering administrative costs, Mr. Tennant said problems, such as those being discussed about the DSMO process, could be solved. MGMA believed they needed to move forward as quickly as possible with the standardization.
Mr. Moran reflected that with matters of adjudication processes and complex claims transaction transmission there are no meaningful standards to say when the world is ready. He advised that, no matter what the standards or date, that level of readiness and compliance probably would be achieved two to three years after the final implementation. One challenge in advising the Secretary is readiness, defined in some firm way, is impossible to achieve prospectively.
Mr. Moran observed that the BCBSA position represents probably the height of all the complexities. He suggested this whole set of issues is both promising and difficult--not because of the EDI transaction interfaces and what it takes for compliance—but because of the nature of the business processes behind that. The character of customer contracts are a major impediment to working into a standardized world. In the world of operational benefits management, this is primarily RFP business, where at least the marketing side of the house explains to the operational side “why the customers are always right and get whatever they want.” Mr. Moran stated that most the details being discussing down to the level of code sets are actually embedded in the triennial collective bargaining agreements between the United Auto Workers and the three large manufacturers, as implemented nationwide. What they will negotiate for and ask Blue Cross and Blue Shield of Michigan, their national control, to implement will be determined by whatever the live requirements are on the ground during 2002.
What people will say yes or no to is not the prospect that some new standard may loom on the horizon. Whatever the law is at that point in time, as implemented in regulation, will be what customers will ask for and what the marketing side of the house will insist be delivered. Mr. Moran said he tried to explain the complexity of the BCBSA position in this world because, as long as these things remain uncertain, there will be tremendous cross pressures. And the only way to get through uncertainty is with, at least some, finality.
Given these states of affairs, Mr. Moran said he was sympathetic to the fact that policy makers may have underestimated implications of what administrative simplification is all about. He noted it was possible to make the case that business practice implications are so substantial as to cause people to question what they are about. And he suggested that if there really are substantive areas into which administrative simplification is or will intrude that ultimately run counter to what interested policy makers perceive, maybe everyone ought to sort that out, cut cleanly, and decide how much administrative simplification can be had.
Ms. Klein addressed the impact implementation of administrative simplification has on state human service programs, especially Medicaid. Complexities of the final rule on standards for electronic standards and the related implementation guides had to be carefully reviewed and understood in the context of Medicaid's unique business needs and processes. Only after addressing this huge learning curve have states begun to move forward with assessments, putting out RFPs and securing vendor contracts. State Medicaid agencies diligently work and move toward HIPAA compliance: a time-consuming and resource-intensive process. She spoke of constraints linked to how legislatures meet in respective states; e.g., her legislature met in January when no one knew, yet, what to ask for. They next meet in 2003—there is no way to seek funds until then. She noted grave concern in public and private sectors that the current time frame is insufficient, particularly with regulations not finalized.
State programs rely heavily on local procedure codes to support coverage of many services. Areas such as home and community-based services, mental health and non-traditional supports are built almost exclusively with local codes. Nationally, over 30,000 local codes used by Medicaid will have to be reengineered. Medicaid is crosswalking the codes and getting others added by the HCPCS committee, a process that will take substantial time. Seven of 34 categories of local codes are done. An additional four categories will be left to each individual state for review and subsequent code requests.
Prior authorization is another problem for Medicaids. The 278 health care service review’s request for review in response transactions lacks a great many of the data requirements used by Medicaid agencies to pre-authorize certain medical services. The current transaction does not serve business needs of the agencies or their providers, yet both would be forced to implement it.
Third party liability and coordination of benefits is also an issue. Current regulations do not clearly include Medicaid post-payment recovery as a HIPAA required transaction, and the code sets do not support these activities. Clarity has been sought, but a ruling has not been received from HHS. Under federal Medicaid rules, states are required to pay and chase claims from other payers. States stand to lose millions of dollars in recoveries if they are not able to bill claims electronically to major carriers.
The HIPAA regulations require massive changes to systems, processes and business practices. In Medicaid, partially due to HIPAA, at least 14 states are replacing their management information systems. Most will not complete re-procurement in time for the October deadline and will have to purchase temporary solutions until the new system becomes operational. And there are no assurances that there will be enough qualified vendors to meet demand in such a tight time frame.
States have serious concerns about budgetary implications. Costs of HIPAA implementation are much higher than initially projected. State assessments are ongoing, but submitted and approved advanced planning documents suggest the cost of bringing state Medicaid agencies into compliance with only the standards for electronic transactions could exceed $1 billion. State funding will be difficult with Medicaid budgets rapidly rising and state budgetary cycles.
The American Public Human Services Association (parent to NASMID) is part of the coalition with the BCBSA and AMA, actively seeking a legislative solution extending the implementation period and creating a single date for compliance with administrative simplification requirements of HIPAA. A longer implementation period will substantially reduce unnecessary spending on temporary solutions, enable costs to be spread over several years, and provide time to develop national code sets and security safeguards that support the unique needs of public programs.
Many unanswered questions remain, with final rules still pending on security, national employer identifiers and NPIs and proposed rules forthcoming on claims attachments, national health plan identifiers and enforcement. With administrative simplification regulations interrelated, it is difficult for states to begin complying until all sets are finalized and their impact can be assessed as a whole. The staggered release of rules means states replacing their MMIS, or making substantial changes must make critical system design decisions based on incomplete information and guesswork. If the final rules differ, states must pay to reengineer.
AAHP is the principle national organization representing HMOs, PPOs and other network health plans. Mr. Saccoccio said AAHP member plans are committed to implementing the electronic transaction standards and the rest of HIPAA administrative simplification, and are taking steps to comply with the final rule. However, the overwhelming majority felt additional time was needed to comply with the electronic transactions and code sets. Reasons most often cited were to avoid conflicts with other information system modifications, allow HHS an opportunity to clarify regulations requirements and develop related ones (e.g., dealing with security, medical records, privacy and plan identifiers), enable plans to coordinate implementation with business associates and other covered entities, and spread the cost of compliance over a longer period--reducing financial burden in any one year.
Mr. Saccoccio concurred with what others had said about the need to try to coordinate the implementation of administrative simplification with some of the security rules still in proposed form. Based on discussions with its plans, he noted AAHP believes HHS’ estimate of an average compliance cost of $250,000 for an HMO or PPO was grossly underestimated.
He said that as a result of discussions with member plans and a number of committees, AAHP adopted a resolution advocating an extension of the compliance period, coordination of the rules, and a compliance period beginning once the last final rule is out.
Noting that the lack of uniformity for electronic transactions and code sets across health plans make exchanging data both expensive and difficult, Mr. Saccoccio affirmed AAHP’s support for the principles of administrative simplification. But he added that implementation of the HIPAA administrative simplification requirements is a costly and complex undertaking for all covered entities. And he emphasized the importance of giving all the entities impacted by these new requirements enough time to implement the changes set out in this final regulation, as well as the other administrative simplification standards.
Mr. Emory urged the Department to promptly and fairly promulgate final transaction standards. He said he was disturbed to hear about publishing rules without going through a NPRM and suggested not having an open comment period would be legally challenged by a number of organizations. An open comment period, though it took time, was an opportunity for organizations to become familiar with the many changes they expected to see in this October rule.
Mr. Emory thanked the DSMOs for all of their work. The AMA had been involved organizationally, and Mr. Emory said he knew the amount of work that went into this. He noted they heard reference to the Gartner study that demonstrated that many health care providers were woefully behind. And he said he was taken by some of Mr. Moertel’s comments about problems organizations still have with standards as they exist today. Mr. Emory observed that most providers still don't understand what HIPAA is or what its implication is for them.
He noted a majority of the AMA’s 300,000 members are practices and small businesses. The magnitude of changes associated with HIPAA will require significant expenditures of resources and time. Mr. Emory recalled that the AMA had consistently advised the Department that compliance with HIPAA should be coordinated. They also counseled that it should be deferred two years, until all the pertinent rules had been published and final. They heard, today, that 230 standards might be included for modification coming out in September. What would they tell people to do? What was out, and what was going to change? No one knew.
Mr. Emory noted that the AMA and a number of other prominent organizations that are WEDI members support S836 and 1975 and a final package that enables a physician to orderly implement the changes that are going to be required as part of their practice. He emphasized that the AMA did not support legislation for any other purpose, other than to make certain that everyone knew what systems needed to be changed, and that they could cost effectively and efficiently come promptly into compliance with the HIPAA rules.
With some of the questions that the AMA’s specialty societies have, the dilemma is, “What do we tell them to do?” A gap analysis is fine, but how does one instruct and guide a specialty society that doesn't know what it ultimately will be held responsible for?
Mr. Emory said he couldn’t say whether physicians were taking steps toward compliance; from his experience with Y2K, he guessed most were not. He said physicians in small practices would probably be the last to implement the provisions. He imagined they found themselves more overwhelmed with trying to stay up with current practice rules and requirements of payers than devoting time and effort to trying to come into compliance with CLIA.
Mr. Schuping said he joined colleagues at AFEHCT and MGMA in being unequivocally opposed to “swarming.” WEDI represents over 180 organizations representing a broad-based cross section of key stakeholders: providers, payers, mixed payer/providers, SDOs, vendors, clearinghouses, and some consumer interests. Collectively, they bring many issues and concerns to the table. WEDI's advisory group process follows a progression of identifying both and, through interactive discussion and sharing of case studies and other information, finding solutions and making recommendations forwarded to HHS for consideration in shaping these standards.
In April of 2000, WEDI created a national initiative, SNIP, which represents nearly 3,000 organizations through list serves and other communication vehicles. SNIP's charge is to assess industry readiness for implementation of the HIPAA standards and, in the process, identify solid data, case studies, best practices, and information gaps—and through a coordinated system of forums and consensus building gain a sense of the magnitude of the problems.
In February, SNIP conducted a two-day industry/public hearing, inviting organizations to share their experiences with HIPAA preparations, discuss problems or concerns and make recommendations. Some 57 organizations representing a cross section of industry submitted written or verbal testimony. Not one expressed opposition to administrative simplification. A significant number of organizations (mostly providers) had not begun preparations and probably could not make at least the initial target deadlines. Some awaited release of the final regulations. Others were stalled on unresolved issues or deeply concerned that this process was happening because there were not adequate resources for everything to move forward in a timely manner.
The letter that WEDI sent in mid-March to Secretary Thompson conveyed that WEDI felt strongly that the health care industry must maintain an aggressive, realistic schedule toward administrative simplification. Mr. Schuping said one of WEDI’s biggest fears was that lengthy, extended target dates might cause organizations to reallocate resources and slow implementation.
Secondly, WEDI felt that sufficient resources were not being given to the Department to deal with the tremendous volume of comments and workload. WEDI recommended that these resources be identified and allocated to move this process forward as quickly as possible.
WEDI shared the packaging concept that Mr. Schuping acknowledged drew mixed reactions. What WEDI heard in the forums they conducted (and again at this hearing) was that it made business sense to view security along with privacy and the transactions and code sets in concert with the identifiers, the provider identifier and the employer identifier. WEDI recommended the same enforcement dates for privacy and security regulations, based on the timing of resolution of key issues. They suggested that a two-year time frame from when these issues are resolved was reasonable, assuming there are no surprises in the final security regulation. And that all of these be synchronized, so organizations can view them together, see linkages relevant to their own tooling operations, and move forward confident they have the full picture in front of them.
Mr. Schuping said health plans should be ready to exchange the standard transactions with any requesting trading partner beginning October 16, 2002. Health plans and their trading partners would be permitted an additional year to complete implementation of the transactions and code sets. There would be no significant financial penalty for health plans, providers or clearinghouses that demonstrated a good faith effort toward completing full implementation of transactions by October 16, 2003--roughly a one-year extension.
Asked why WEDI amended recommendations stated in their initial report, Mr. Schuping explained that, in part, it was a response to industry feedback. Their recommendations were written in 1993 with two basic premises: one, the initial regulations would be issued as a package; and two, there would be adequate government and private sector resources to make it happen.
Mr. Schuping stressed that WEDI is solidly behind moving forward with administrative simplification; whatever resources are necessary need to be marshaled and brought forward. He emphasized he didn't want to see unreasonable delays because he had addressed concern that organizations might begin to downshift or reallocate resources needed to comply. Problems with issues needed to be resolved. An adequate infrastructure must be in place, particularly at the Department, to assure successful HIPAA implementation. And a realistic, achievable schedule was needed that everyone could move forward on, collectively.
Mr. Emory expressed concern at hearing from representatives of the Secretary’s office that the Department couldn't do anything. He found compromise possibilities Mr. Gilligan raised encouraging, but they didn’t alleviate concern. What he sought was a willingness to consider options that gave everyone adequate time, once a package was developed. Given the feedback, Congress seemed the only way to get that. Mr. Saccoccio noted a recurring theme with many plans was the need for coordination between security and privacy. Mr. Gilligan said he was unalterably opposed to tying regulations together: politically, it made no sense. They didn’t know HCFA and HHS would gain staff and were assuming good faith participation and that, down the line, no one would stop a regulation. Tying the regulations together was “buying a pig in a poke.”
Mr. Moran observed they already had endless clean-up, fix-up legislation in Title XVIII. A time-uncertain delay linked to regulatory actions subject to the whims of back-and-forth political action wasn’t a standard. Mr. Tennant agreed. Everyone favored administrative simplification. The faster they moved, the better. Without a specific compliance date, there was little incentive for providers to move. Tie it to some nebulous standard not even out yet, and the momentum was lost--not just to submit an electronic claim, but to streamline administration of health care.
Mr. Reynolds noted the Blues were already on the Hill with their position but, speaking as an implementer of a large project, he suggested that how providers (particularly hospitals) select the transactions code sets, the identifier, and especially the NPIs, could dramatically change the way they administer. He questioned how they could commit to privacy: privacy and security needed to be together, so they knew what was private was secure under the guidelines. Mr. Reynolds suggested that maybe the final rule was an “initial rule.” There was no “final” rule in HIPAA.
Ms. Klein commented on the need for a stable base--knowing it wouldn’t be perfect, but finally they would know all the rules and what the whole field was going to look like. She said they weren't asking for extended time without reason. That stable base was needed so everyone could move forward. Mr. Schuping reiterated that WEDI’s bottom line was to get the regulations out as soon as possible and he emphasized that required additional resources. They had gone through a long period of delays. They needed to step back, consider what could be accomplished with resources, and set a realistic, achievable schedule they could believe in and move forward.
Observing that the concept of a package deal implied a point when everything was static, Ms. Ward submitted that would never happen. The morning's discussion was evidence of that. They had something they called final, and now saw there were reasons to change it. She predicted there would not be a final rule for claims attachments before 2003; extending two years beyond that brought an implementation date of 2005 (assuming it was the last final of this first round). She cautioned that no one aggressively implementing wanted to wait until 2005. Ms. Ward encouraged the committee to consider the impact requesting a delay would have on the industry. Most the industry was waiting for the final rule. Pushing out that date, they’d only wait longer. Mr. Gilligan concurred. People pushing forward would wait-and-see, compounding the problem.
Ms. Ward strongly disagreed with waiting until all the finals were published and extending. If extending, even for a year as WEDI suggests, she cautioned the group to be clear and firm about milestones, deliverables, and requirements in the interim. She challenged the notion that transactions cannot be implemented without the identifiers: noting nothing in the development and exchange of the transactions requires the identifiers in final form. Dr. McDonald reflected that if they had settled for saying they were not going to have an Internet until it was all done, they never would have had one. “I want the biggest machine; I’ll wait one more year”--That logic didn't hold up in a systems world. He said if you want to kill regulations, just bind them all together. Ms. Weiker echoed these views. EDS was opposed to any delay.
Dr. Fitzmaurice noted they’d heard unanimous agreement that the industry would do it if all the standards were in place and they had time to implement and spread out capital costs. And they heard HHS needed resources to get the standards done in that reasonable time frame. He said the Department did a tremendous job listening to the industry, finding out what was wanted and trying to give it, then coming back and trying again. They set--and went for--priorities for transactions and codes. Getting something out people could build and save money on, then protecting the electronic data, was the next priority. Now, with the resources that would be devoted to this, it was time for more priority setting. Whether it got done in the time frame targeted depended on what was devoted to it.
Mr. Blair reflected that, listening to all sides, he found himself acknowledging the validity everybody expressed. People wanted lists to go forward, yet struggled over concerns about flawed implementation discrediting or impairing HIPAA’s credibility or damaging future implementations. He posed a query. They were waiting for a final rule for the NPI, the health plan identifier, health claim attachments and security and enforcement. If Congress didn't delay the dates, and the administration didn’t further delay things but HHS puts priorities on getting final rules out—which were top priorities for the next final rules? Mr. Emory chose security and attachments. Mr. Saccoccio named security and the health plan identifier. Mr. Moran noted security had the most high-level architectural implications and that queuing anything behind attachments bogged things down. Mr. Tennant put claims attachments and the NPI at the top. Mr. Reynolds noted the Blues had already said they wanted them all. Putting them in order, security had to go with privacy; he echoed comments on attachments. Ms. Klein noted the Medicaid agencies were at different places, but the NPI was important to them all and security was a big issue to go along with privacy. She concurred with the comments on the attachments. Security and the identifiers were Mr. Schuping’s first choice.
Dr. McDonald reflected that, if one didn't assume attachments had to be done at once, scanning and other things “cooking” might make that easier. He suggested that assuming that privacy couldn't do anything without security was not analyzing correctly. The privacy law provided legal remedies for anyone giving away medical records and HCFA had requirements about the Internet.
Following up on Mr. Blair’s query, Dr. Cohn asked what the Secretary could do to ease the implementation barriers they described. Mr. Gilligan encouraged the Secretary to find justification for being flexible with the enforcement in Section 1176. He said public comment, conveyed in a way that kept those already moving forward committed, could resolve concerns. He also pointed out that they had lost sight of the big picture in terms of resources. They were looking at a multi-billion-dollar change to the health care industry and potential multi-billion-dollar savings. Yet the DSMOs struggled to come up with $30,000 to produce a Web site so the public could comment. Volunteers worked hard, but there weren’t enough. More people needed to be educated. If education came from HCFA, providers would listen.
Ms. Klein observed that movement to compliance would come when people realized the benefit. She questioned how much people could be punished for not doing it--They needed a reason. Ms. Theresa Doyle, a consultant to BCBSA, suggested people would be compliant once a law was in place. That was why they sought an extension. Dr. Zubeldia remarked they knew there would be further final rules on attachments; there never would be a “final” on anything. He said he was encouraged that the enforcement final rule wasn’t mentioned as a priority in their informal survey. They put it with the least priority, which meant it could come out last, effectively giving everybody a delay in implementation.
Mr. Emory noted that the physician community had a lot of negative experiences with the Federal Government over penalties and sanctions. Physicians were not going to feel comfortable with more time, knowing the enforcement rule wasn’t issued. A concern that sizeable penalties might be imposed was one thing that would keep physicians moving forward. Mr. Saccoccio commented that a law with a requirement for a certain date affects multiple aspects of operations. Even with a statement of flexibility from HHS in respect to good faith compliance, employers might require a compliance date as part of contracting and state entities might ask about compliance as part of the licensing process. Dr. Zubeldia said he found that comment ironic, having just heard physicians weren’t taking steps towards compliance.
Dr. Zubeldia noted a theme heard throughout the testimony was that everybody wanted to know what the rules would be. Either they wanted finality in the rules before implementing or before enforcement. He cautioned finality in the rules before starting to implement was a risky proposition. He doubted that finality and compliance within a reasonable time frame could both be realized. Dr. Zubeldia said most the 15,000 providers in North Carolina needing to implement probably already did some electronic transactions with current identifiers. Staged implementation was typical and testing did not disrupt production much. He asked if getting the payers ready first, then giving time for the vendors and providers to become compliant without stopping their production stream after October 16, 2002 (giving two years, if they couldn’t become compliant in 12 months) would help the payers. Was it worth providing a non-disruptive method of implementation rather than running two systems in parallel for an extended time? They were already running dual sets of codes. Every year, from October to January or March, they had two sets of ICD-9s and two sets of CPTs they had to keep for several years. Mr. Reynolds pointed out that they couldn’t run the same business process against both sets in HIPAA. They’d heard that morning that, pulling back the NDC code completely changed the way hospitals dealt with pharmacy. They were changing the way business was done inside the entities.
Passing claims was one thing, Mr. Moran remarked; accurately adjudicating them against business rules applied under the terms of contracts was another. He suggested almost everybody could pass compliant claims by October 16, 2002, if all they did was generate standard claims one place, receive them elsewhere, and send back standard remittance advices. The concern wasn’t about the interface, but back-end business processes on the payer’s side that ran on another set of rules. One reason they had to move forward as fast as possible was that, ultimately, those business processes had to be redesigned. The challenge was that many people with business processes more complicated than what standard claims would support, were going to have to drop or modify those businesses processes in order to adjudicate claims accurately in a standardized environment. He suggested it might not make sense to rush forward on attachments--they offered potential work-arounds on a number of standardization problems. Asked if an earlier implementation date for the payers, followed by another 12-months for the providers, made sense, Mr. Reynolds said everyone needed to be ready in reasonable proximity and then have a certain time to transition.
Dr. Zubeldia noted that a premise in the HIPAA law is that the payers have to receive the transactions. It doesn't say they can't receive non-standard transactions, but does say the providers can only send standard transactions. The payers could receive a non-standard transaction without penalties, but there would be no way the providers could send it. Amending that, so there is no penalty if the providers do not send standard transactions for a year, would provide non-disruptive transition time.
Dr. McDonald argued the notion that changing away from the NDC disrupted hospitals didn’t compute--they didn't use it. He noted 20,000 non-standard codes had been reviewed and only about 700 new codes were needed: not a huge burden. And his understanding was that less than half the doctors were sending electronic messages to all their payers; so it wouldn't be all 15,000, unless the rest were hospitals. He said Medicare contractors had been dual submitting for years. Dealing with codes would be an exception, but from a format perspective payers have been accepting and dealing with both a long time. Speaking as co-chair of the Attachment Work Group and a work group in X12 that dealt with attachments, Dr. McDonald said anything that makes itself into the HIPAA attachment is subject to the DSMO process and would not become a vehicle for work-arounds. Ms. Ward reported that some payers were going to continue to accept non-standard from their providers after October 2002.
Ms. Doyle expressed concern that, running several systems, the reconciliation process would be complex, costly and disruptive. Numerous state agencies had new systems slated to be up and running just a year or two after the 2002 deadline. An extension would save a lot of money otherwise wasted on temporary band-aid solutions.
Dr. Zubeldia observed he heard several themes. A disruption theme: nobody wanted the disruption of this required implementation date. An everything-in-place-at-once theme, so everyone knew the rules, what had to be done, and only did it once. And another concern that having everything at once caused changes in business processes: an everything-at-once-is-a-lot-to-swallow theme. MGMA presented the option of implementing phases. Dr. Zubeldia suggested that having and doing everything at once could take five years, which might not be feasible considering implementation was an ongoing process. Final rules did always change. Was it better to implement stepwise, using today’s identifiers another few years, and today’s code sets a few more—or to have everything at once and get an extra five years to implement?
Mr. Gilligan asked what the HHS staff visualized if they waited until all the regulations came out: a year or two later would there be a set of “regs” that covered the full spectrum of HIPAA with all the changes in one document? Dr. Braithwaite replied that, given current resources, there was no way HHS could put out an omnibus. Mr. Emory asked if anybody in the new administration had said, “Get this done,” or asked how long it would take? Clearly, the Subcommittee needed assistance that the administration could provide: a firm commitment with resources behind it. Everyone wanted to see the rules published quickly. Mr. Moran suggested the nature of the commitment might be to not do too soon standards that were not yet done. As a practical matter, this was all systems integration work. Everybody was building out different components. It might be that knowing certain aspects wouldn't have to be converted for another two years would offer enough head room to prioritize.
Ms. Trudel observed that they’d talked all afternoon about not wanting to start the clock any sooner than some date in time. She asked if there was a start-the-clock-no-later-than-date? Mr. Emory stated the AMA would like to move forward expeditiously. Getting it done tomorrow, with the compliance date two years later, was reasonable. Mr. Reynolds noted every Blue had substantial resources working and would love to turn it up. Mr. Tennant noted that clearly was not what the House and Senate bill said: 1975 said the provider identifier would be out to every possible provider, including potentially medical students. He suggested that by changing one word in those bills to “the earlier of” they could make their argument. Mr. Gilligan asked if that one word would also change the resources available. Dr. Zubeldia said that date--1998--was already in the Act. Dr. Braithwaite noted that when there was an administrative priority on getting out a privacy rule, they got it out in about twice as long as they’d said. That was a lot faster than they had been able to do with anything else, because resources were there to make it move. Mr. Gilligan remarked that was why he didn’t want the “regs” tied together.
Asked for preferences for implementing one step at a time, Mr. Reynolds, speaking as an implementer, responded that if the provider took the NPI within 90 days after it was issued and used it on paper and/or electronic they would get some order. Transactions, code sets and then identifiers are the things that administratively run through “this world.” Some 90 percent of their hospital claims and 67 percent of their physician claims were automated under codes that were going to change. They were looking for order and structure.
Dr. Zubeldia asked if life would be easier if everybody concentrated their limited resources in implementing transactions with the code sets and then the identifiers Mr. Reynolds had today. Mr. Reynolds said philosophically, he understood the question, but reality-wise, it made him nervous. He said it was a good question for anybody. Ms. Weiker noted there were certain data elements that didn't exist in the implementation that were used in back office business process type of service. Medicaid was an example. They discussed disaggregating the changes with the standard format from the code sets and the identifiers, centering the resources in one thing at a time.
Dr. McDonald noted there were sentiments that wanted a fairly complicated set of things that would result in extensive delay. He said they needed to remember the provider and not let this be a mechanism for adding data gathering and making life harder. Nine transactions were approved. The question was whether to shut down modifications or make them small so things could go on. Dr. Cohn observed that mostly they’d seen things taken out; only a couple of code items were added. Dr. McDonald said that the idea of tying them all together had merit in terms of the Internet but that all standards change; they needed a mechanism for that. Noting that a highlight of the day was the letter from the Secretary to NCVHS accepting the recommendations to keep the NDC out of the requirements, Dr. Zubeldia proposed a statement of direction, inline with the white paper for attachments, that helped the industry prepare for the NPI or the payer ID. Once everyone knew what changes they need to make, it was a step-wise implementation. Mr. Blair said he heard that, if they give the industry confidence that the NPRMS was a good predictor of what the final rule would be, they were more likely to begin implementation. The closer the final rule on security regulations was to the NPRM, the more comfortable the industry would be interpreting what would happen with the NPI, the employer plan identifier, and health claim attachments. Dr. Zubeldia suggested the Department could publish a summary of statements received during the comment period.
Dr. Cohn said they had heard a fair amount of counsel and much had become politicized. They needed to put it together, along with their own views, and see what they needed to communicate in relationship to the DSMO recommendations to NCVHS, as well as recommendations they had to the DSMOs about how to proceed. The meeting was recessed at 6:00 p.m., to reconvene at 9:00 the following morning.
Dr. Cohn reflected that, even though a lot of concern was expressed about the fast track process, without it no changes could have been made in initial regulations until implementation. Any change made through the regular DSMO process would have been too late for the October implementation date.
Dr. Cohn suggested supporting all A recommendations without question. Hs would await further direction from the DSMOs. The DSMOs needed to consider whether any Bs should be implemented prior to October, 2002 (become As). A number of them were relatively minor changes, deletions or clarifications. He pointed out that the results of all this were likely to be static for the next year and a half. Dr. Zubeldia recommended getting them done. Mr. Naminschon noted changes had to not only go through the DSMO discussion, but back to the SDOs. In many cases, especially Bs, changes could not be made in such a short time frame.
Dr. Zubeldia said filtering needed to take place to prevent conflict later during the NPRM phase. The Subcommittee could make sure consensus was reached before recommending the Secretary make a change. Dr. Cohn recalled at least one testifier observed that consensus was not unanimity or universal agreement. He questioned if it was realistic to expect that an NPRM would come out with no one commenting negatively. Noting everything was subject to appeal that day, they questioned whether, knowing there was disagreement among the DSMOs, they should move appealed issues forward or hold back until agreement was reached. The appeal process, which began yesterday, would take about 20 days. There would be more Hs. Anything categorized as a no change, then appealed and declined could be brought back through the regular DSMO process next year. Category Bs go forward, but require data maintenance or a higher version of the X12 standard and could not be done now. Ms. Weiker said she hoped to have results and recommendations to the Subcommittee by late June, so they could move through the NCVHS process. In June the group would look closely at requests appealed, making sure there weren't major industry issues. Dr. Cohn said he was impressed with the overall DSMO process, including the fast track effort. A lot of thought went into it and the DSMOs were doing a good job of getting relatively wide comment. Obviously, the Subcommittee’s responsibility was to make sure there weren't unforeseen industry consequences with groups not involved in the process. He said it would be useful to hear how things got resolved in terms of appeals. Dr. Zubeldia suggested that indicating in the spreadsheet issues voted on because of a lack of consensus would help the Department assess the comments during the NPRM process. Ms. Weiker explained that the spreadsheet wasn’t meant to be distributed widely. The DSMO Web site stated only the final DSMO comment. They wanted to present a united front.
While noting it was helpful to the Subcommittee, the full Committee, and the Department to know about areas of contention, Ms. Greenberg said they were committed to working through the voluntary standards organizations. Only in extreme cases would the Department second-guess what was decided through that process. Mr. Blair concurred that they would undermine the credibility of the DSMO process if they begin to parse out whether or not the vote was a majority or consensus. But the group noted that the Department had to respond to issues during the comment period of the NPRM and had the responsibility, and ability under the APA, to do fact-finding. One reason NCVHS was included in the DSMO and MOU process was to provide an open public forum. The Office of General Counsel had asked the Committee to ensure there was open public process and considering the DSMO decisions was part of that process.
Ms. Ward said she couldn’t attend the meeting but would e-mail details as close to then as possible. Ms. Weiker said the question of whether a representative from DSMO could be there to discuss the appeals process brought them back to time, resources and money. Ms. Greenberg noted that, on an exceptional basis, the Committee had limited resources to travel people whom the Subcommittee felt it was essential to hear from in order to conduct their work. Ms. Weiker said that if she chose to spend a vacation day that way, she could. Dr. Cohn said whether a co-chair or another member of the coordinating council came was up to the co-chairs’ discretion.
The group discussed that people with more to say typically did so in the NPRM process. Dr. Braithwaite said if someone from the public sector felt they needed to testify, they should be given an opportunity. Mr. Blair noted they wanted to encourage people concerned about how their views are represented to work within the DSMO process. Dr. Cohn pointed out that the next step was the appeals process; whatever happened, by definition some people would not be satisfied. He suggested asking for written comment. Ms. Greenberg suggested including in the Federal Register notice for the meeting the fact that the Subcommittee and then the Committee would consider the recommendations coming out of the DSMO process.
Mr. Blair reflected that the NCVHS’s role was to oversee the effectiveness of the DSMO process, and that when an individual group or entity felt uncomfortable with the way the DSMO process worked, they had the option of testifying about how the process might need to be corrected. While the Committee might hear specific complaints, for the most part, they heard them as examples of flaws in the DSMO process, as opposed to being an appellate entity for a specific decision. Dr. Cohn disagreed. Relatively specific legislative language in HIPAA stated the Secretary was to rely on the Subcommittee’s recommendations. Their responsibility was to take those recommendations, make sure they were appropriate and move them forward. They were involved with substance. The next meeting was not about the DSMO process; but about recommendations. Mr. Blair suggested, then, that they make sure all the Subcommittee members had time to review with integrity each recommendation.
Nothing would change in section A. All they had to review by the end of June was Category H and anything appealed that required them to recategorize it as an A. After seven days they would know which items were up for appeal. The results would be the focus of the meeting June 27. And the letter would address any changes needed in the financial administrative transactions and the final rules to make them more implementable. They would publicize that, hopefully they would be making Subcommittee recommendations to the national committee in June.
Seven Es were pended, awaiting policy decisions by the Department. Ms. Weiker reported that the 837 dental claim was recommended for dental predetermination: HCFA and HHS will now determine whether they adopt that and take it forward in an NPRM. Ms. Ward clarified that this was not about changing an implementation guide, but the reference to the use of that guide in a final rule. The 837 dental guide supports that business function, but the final rule states that the guide is used for claims or encounters. Predetermination of dental benefits had to be added. It was a policy decision, but the request came in through an implementation guide process. Dr. Braithwaite agreed. It was an NPRM statement for comment, and the DSMO’s recommendation that it be allowed was a recommendation to the Department. Ms. Weiker said the seven would be included in the transmittal.
Ms. Weiker noted not all state agencies agreed the Medicaid pay and chase needed to be part of the initial implementation. A survey would see how many wanted to implement it along with the other nine transactions. NCPDP had made a subrogation of pay and chase implementation guide. It took several meetings; there was quite a difference between submitting a claim from a provider to a payer versus a payer-to-payer transmission where you turn around and pay Medicaid. Ms. Ward said the answer from HCFA central office was that use of the guide for that purpose did not meet the use of the guide in the final rule. Agencies meet the business in a proprietary format. Some do it on paper. They can still use an 837 standard, but not the implementation guide. Mr. Landen explained it had been proposed as a coordination of benefits issue. They felt it fit better into subrogation, which was not a specified HIPAA transaction. Doing a subrogation component is a bigger process than can be accommodated in this fast track time period. Mr. Naminschon noted that Medicaid needed to sit down with the X12 organization, explain their complete business need, and work out a solution. If that solution is workable, they can adopt or determine that subrogation is a transaction that needs to be standardized, and adopt the appropriate implementation guide. It is a long-term process, but first steps have been taken.
Ms. Ward explained that the requester of item 223, which recommends the use of local HCPCS J codes for professional institutions, believed they had to use NDC codes. The request was intended to give them an additional year to use local codes before they had to be fully NDC compliant. The decision on NDC made this a moot point. Ms. Weiker noted that HCFA was in agreement with the recommendation for items 228 and 361 dealing with NCPDP. Dr. Zubeldia noted that the rejected item 347 requesting that people could develop their own local codes was a policy issue; the group did not want to second-guess the DSMO. Item 361, the NCPDP, changed the batch version from 1.0 to 1.1, which supports telecom version 5.1. Ms. Weiker explained that the Medicaids sought clarification in item 408 of the definition of an encounter: when a managed care organization sent an encounter to a Medicaid was that covered under the final rule definition? In their discussions, the definition of an encounter was from a provider to a health plan, not between health plans. Mr. Naminschon said an FAQ clarification would be posted soon.
Mr. Naminschon clarified that HHS could build the shell outlining changes, the background, and history of the DSMO process, but couldn’t put it through the clearance process until they had the exact set of recommendations. Their goal was to have the final rule published by mid- February, meeting the October deadline. Ms. Trudel said they would start drafting next week.
Dr. Cohn summarized the next steps: drafting the letter to the Secretary, the DSMOs completing their process, hearing soon about items coming up for appeal and understanding, as soon as possible, the results of appeals, then taking testimony from the DSMOs along with anyone else in the community that felt they needed to testify, and hopefully bringing something forward to the NCVHS at the June meeting.
Dr. Cohn suggested general industry readiness issues might be the letter’s final topic. He noted there were actually two letters to draft: one addressing what the DSMOs recommended and another focusing on general industry readiness and what HHS needs to do to support implementation. Ms. Greenberg suggested a sentence in the first letter encouraging the Secretary to expedite moving the changes recommended for the first year this through the process.
Mr. Blair asked if members felt it appropriate for the NCVHS to make a recommendation about whether the NPRM process was necessary. He said his view of NCVHS’s role, which was broader than just oversight of the DSMO process, encompassing examining specific issues and appeals, seemed to strengthen the idea that an NPRM might be redundant. Noting the AMA stated a clear position yesterday, Dr. Zubeldia said they probably ought to explore how to expedite the process. He had seen some rules go through HHS and months after the NPRM there was a final rule. It didn't have to take three years. How could they expedite the process?
Dr. Cohn noted issues they had heard that needed to be fashioned into a letter. First, the Secretary needed to provide leadership and funding to get out the remaining final regulations. Every testifier spoke strongly for getting all the “regs” out as soon as possible.
Yesterday was spent discussing the DSMO process, recommendations, and how quickly they could get them out. Dr. Cohn noted they could make changes once every year, but it could take three years to get them in a final rule. HHS needed to consider an internal expedited change process to work with recommendations for changes to final rules applying to all the HIPAA standards. Ms. Ward noted the reason they fast tracked was the “out” in the rule stating they could make changes within the first year. Everybody knew how that would happen with transactions; nobody knew how to do it with privacy. Clarifying the process to bring out the other rules would ease confusion in the industry. Noting the Secretary had received some 20,000 comments about changes to the privacy rule, Dr. Cohn expressed confidence the process was there--The question was how it could enable HHS to respond quickly. Asked if they weren’t talking about a process for changes to the standards, not necessarily the rules, Dr. Cohn replied they couldn’t do one without the other. The NDC was a change to the rule, not to the standard. Mr. Blair observed that industry testifiers almost uniformly said they wished HHS had a greater sense of urgency to get the NPRMs and the final rules out. Dr. McDonald observed those comments were tied together by a few testifiers who claimed they all had to be done at once. That was impossible. He cautioned everyone not to be lured into a position suggesting they thought that was true.
Testifiers called upon the Secretary to provide for an update to UB92 and 1500 to enable increased comparability between paper and electronic formats. Dr. Zubeldia said he’d heard anecdotal evidence that people want the paper formats obsolete, so everyone has to use electronic transactions. Ms. Trudel noted the last time there was an attempt to redo the 1500, industry people had significant problems and it was shelved. Dr. Cohn remarked that with HIPAA the industry was recognizing a need for these changes; the Secretary could provide valuable leadership and assistance to make that happen. Mr. Naminschon noted that the final rule for electronic transactions mentioned the Secretary has the authority to set standards for paper transactions, but at this time declined. The intent was to get electronic transactions out and see how the industry reacted, assuming they would take it upon themselves to standardize paper transactions.
Dr. Zubeldia said what he heard from testimony was not concern about the paper form, itself, but an inability to enforce the new identifiers and code sets on non-covered entities. Dr. Cohn recalled Ms. Schulten observed changes either needed to be made to the form or how it was used. Ms. Fyffe identified two fundamental business implementation issues. A weakness in the law did not require providers to use electronic transactions. And, because of that and what they heard of differences between identifiers, providers that did both electronic and paper transactions and payers had to cope with fundamental differences in the information. Dr. Zubeldia suggested it would be useful to have an implementation guide for the paper form indicating a standard way of communicating extra elements the ASPIRE project identified: e.g., traditionally, X is put in the box indicating type of claim, but instead P, S or T could also convey primary, secondary or tertiary. Similarly, a blank space or a box reserved for local use could convey the provider taxonomy. Ms. Ward remarked that when NUCC held focus groups and asked about revising the 1500, the response was to draft an implementation guideline on how to properly fill out the form. Ms. Weiker noted the 837 implementation guide and ADA form also do not match. Mr. Landen questioned the value of maintaining a paper standard in a post-HIPAA world. The UB has a 10-year moratorium that ends next year and would need to be redesigned. What was the trade off between the value of having a standard paper form in a HIPAA world versus the resources it took collectively to maintain it? Dr. Cohn noted the need to provide for transition. They’d heard a couple times yesterday that having continuity in data elements and/or implementation guides would be helpful. “You don't just pull plugs on people,” especially dealing with claims.
Dr. Zubeldia pointed out that a lot (e.g., certification records and the DME certificate of medical necessary) had fallen into the 837 electronic form beyond the scope of a 1500 or a UB92. He cautioned everyone retrofitting to remember that the 837 had multiple forms built in. Noting they didn’t want to micromanage, Dr. Cohn suggested the question was whether to suggest to the Secretary the need for continuity, recognizing there were ample experts outside the room. Dr. Zubeldia supported the recommendation to NUCC and NUBC to look at an implementation guideline for the paper form aligned with HIPAA data requirements.
Dr. Cohn observed the testimony highlighted issues where the Secretary could take leadership in providing orderly implementation of HIPAA. Regulatory flexibility in regards to a modest, fixed delay was one issue. They heard a lot from the industry about the consternation caused by uncertainties at HHS about implementation dates, causing many to back off on implementation. He noted Dr. Zubeldia’s comment that HHS needed to make available to the industry current thoughts about what pending future regulations will require: e.g., how many digits will be in the NPI? What significant changes are likely to be coming on security? Ms. Beebe suggested they’d heard not only about a need for leadership but also commitment. They heard a lot yesterday about the lack of resources within HHS and other responsible agencies. Dr. Cohn said that they’d talked about needing adequate funding to make things happen; probably that applied to both getting the HIPAA out and getting everything implemented. Dr. Braithwaite reflected the industry was asking for two things. One was resources and funding. The other was prior knowledge about what was going to happen: letters from the Secretary, white papers, whatever conveyed the decisions made about the NPI, for example, before the NPRM comes out. Or putting the standard for the identifier out before you figured out how to actually implement it.
Mr. Blair identified three positions that the group might consider for the Committee. One: reflect priorities clearly heard to get the data security and the NPI “regs” out as soon as possible. Two: not do things that undermined elements in the industry working hard to move forward (He suggested NCVHS might want to consider it premature to signal any type of delay). Three: recognizing that with different transactions and code sets certain segments of the industry might have difficulty meeting the final compliance dates, NCVHS should monitor industry progress, giving special attention to those demonstrating best efforts to move forward. As the compliance deadline approaches, if certain portions of the industry or specific transactions need additional time, recommendations could be made selectively. Dr. Braithwaite said he liked that sentiment, but the testimony contradicted it. The industry said it needed a fixed date, followed by a more flexible implementation period with a fixed ending. If everybody wasn’t ready at the same time to do at least an identified subset of transactions, they would have to run multiple information systems. With a more structured, or even phased, implementation plan (similar to what Dr. Zubeldia suggested yesterday) the industry said it would not have enough time. A few subsets could be ready by October of next year. But the majority needed, perhaps an extra year to be ready, and some specified transition time (another six months or a year) to gear up and make trading partners tested and compliant.
Mr. Blair said putting things in phases made sense, but they needed to learn more before they could identify the phases. Perhaps segments of the industry (e.g., rural hospitals or solo/group practices) needed a longer time. Cautioning that looking at delays on a wholesale basis might discourage people putting forward budgets, he suggested instead monitoring the progress and seeing where delays were needed. Dr. Zubeldia concurred. Yesterday, people hadn’t said what the delay was for. The AMA reported the providers were behind the curve--yet said they were not doing anything to make them ready.
Dr. Braithwaite noted they heard one reason why people needed more time. Adjudication of the various contracts depended upon the provider supplying information in such a way that they didn't have to change adjudication systems. The business process of adjudication was dependent upon special local codes and identifiers that had intelligence. The standards stripped that intelligence away and adjudicating processing had to be redeveloped. Because of that business reengineering, they needed more time and to know the identifier standards so they could determine how to reengineer their processing behind those identifiers. Dr. Braithwaite suggested some phases touched upon yesterday could help the industry comply in a relatively rapid way staged according to the major changes. Ms. Greenberg noted another reason heard for more time with some Medicaid’s was a legislature that met every two-or-three years so there, literally, was no way to fund implementation in time. Ms. Trudel reported the Department had not taken an official position on the legislation introduced on delay.
Dr. Zubeldia noted another leadership position the Department could take: Mr. Reynolds had encouraged issuing the NPIs quickly, so parallel systems weren’t deployed for years. Dr. Cohn agreed that they didn't want to provide incentives for people to slow down, but he said he struggled with the scale of implementation--18 months was not a long time. He noted agreement on a couple opinions that the Secretary might use if any delay was considered. He doubted anyone on the Subcommittee was in favor of an indeterminant delay; they needed to make a strong statement for indeterminant as opposed to a fixed delay. They didn’t want a delay so long that it encouraged those already putting projects together to disassemble. The question was, how long a delay gave enough time to move in an orderly successful way while not encouraging people to slack off. He suggested they were talking about a modest fixed delay to encourage successful, orderly implementation. As they moved forward, they needed to observe who was having trouble and the Secretary might need a bit of regulatory flexibility, in a way that did not discourage implementation. Ms. Weiker noted small providers and health plans already had an extra year. Mr. Blair commented that a number of testifiers had been proactive, investing in the process and working with WEDI SNIP in the coordination. They had to consider giving them relief, if needed.
Ms. Ward recommended following the WEDI HIPAA success task force approach and giving a delay with a date, deliverables, and requirements. She said this spoke to HIPAA program offices not losing next year’s budgets (Many were starting to lose them because of the threat of a delay). Did she think most of the people she worked with would be 100 percent converted in October of 2002? No. Did most need more than another year? Probably not.
Dr. Zubeldia noted that the Medicare carriers would be ready this October--a year ahead of schedule. One reason was HCFA decided not to change the adjudication system. Implementing EDI with a translator simplified the process. Clearinghouses (which use the EDI translator and mapping rather than an adjudication system) claim to be ready. Dr. Zubeldia pointed out that what complicated things was changing the identifiers, the code sets, and the business rules. He suggested as long as the adjudication system didn't change and there weren’t repercussions in the rest of the business, implementation was feasible within the two-year time frame. The taxonomy codes and the removal of the local codes could be part of the deliverables Ms. Ward recommended. Since neither the NPRM for the payer ID nor the final rule for the NPI had come out, Dr. Zubeldia suggested that schedule of delivery was already built into the system. If they stuck with the dates for parts they already had, the problem was solved, except potentially for local and taxonomy codes that could be retracted, just as the NDC was changed. Many of the comments to the initial transaction and code set NPRM requested a phased approach. Ms. Greenberg agreed. A delay was built into the identifiers: if they weren’t there, no one could use them--everyone could implement without them. She said she was impressed with what Medicaid had done with the local codes. She didn’t know how much the HCPCS process could meet their requests, but she was sure HCFA would make every effort to do so. She realized the taxonomy was a big issue, but said she was not convinced the Blues couldn’t figure out what to do about local codes. Dr. Zubeldia observed that many of the Medicaid carriers and intermediaries that would be ready this October were BCBSA plans. He said he also was impressed that Medicaid had gone from 30,000 to 600 codes, but noted only the Medicaid work groups knew them. Ms. Ward said they had been offered to the HL7 work group.
Mr. Landen said that, as co-chair of the WEDI policy advisory group on the identifiers, he knew there wasn’t commitment yet on how the NPI would be funded. They knew a bit about what the identifier might look like, but faced three possibilities. Each provider might have one or two identifiers, similar to how Medicare works today and dissimilar from how much of the private sector managed care contracting world works. The recommendation from WEDI would allow providers to request as many NPIs as they feel they need for business purposes. Implementers also contended with the possibility that the funding problem would not be solved and there wouldn’t be an NPI anytime soon. These were business issues the Blue plans and others worry about designing their implementation strategy and system architecture. These were also reasons for a package; sequential or piecemeal implementation wouldn't work for much of the industry.
Dr. Zubeldia noted one argument for choosing the X12 standards was that they could be implemented with a translator, isolating the communication standard from the legacy system and the system behind it. There was a request to get a delay to change the back end system. People were going away from the translator concept that made the back-end system transparent and the EDI independent; tying both together. He acknowledged there were business reasons to do that, but with a translator the back end system could be changed at their leisure.
Dr. Cohn proposed that they craft the comments into a draft to consider further. A June 26 meeting was scheduled to further discuss recommendations to the Secretary, as well as issues coming forward from the DSMO appeals process.
Mr. Blair pointed out they also heard that people thought it desirable to test new standards to be implemented. Dr. Zubeldia noted there was a procedure in the law for testing new standards to be adopted by the Secretary as replacements of existing standards, but he was not sure there were procedures for testing new standards that were not replacements. There was a requirement that the DSMOs do a certain level of testing and the preamble on the transactions and code sets final rule discussed the kind of testing DSMOs were supposed to do. Ms. Greenberg pointed out that the Committee indicated that they should make sure that any proposed standard was out in the community and preferred to be in national use before it was adopted as a national standard, de facto standard approach. Given the HIPAA process, something could not be in national use unless it was adopted. Dr. Zubeldia said if the prescriptions became a national de facto standard, it could later be adopted as a standard by the Secretary. Prescriptions was not part of the nine named standards; people were free to use anything they want. That was what that paragraph referred to.
Ms. Weiker noted they’d heard a lot about, “Why I can't do it,” and little about “How I am doing it.” As Dr. Zubeldia had pointed out: some people would be ready this October. UHIN was ready. She had health plans ready. She suggested there might be best practices to be learned and adopted before the Subcommittee started drafting possible delays. Dr. Zubeldia agreed that they needed to hear more HIPAA success stories. Perhaps HCFA, UHIN, and some of the clearinghouses could tell what they do differently. Mr. Blair said a vendor told him about implementing with payers and providers who said, listening to people ask for delays, they felt they would like to be heard. Dr. Cohn said he didn't know that anecdotal stories would be helpful. They had heard from WEDI who probably had a better sense than anybody about successes. An unbiased survey of the industry might help them understand status and issues. Mr. Naminschon remarked that The American Hospital Association had a survey and wanted to testify. Dr. Zubeldia mentioned The Gartner Group and Phoenix Health had recent surveys. Dr. Cohn suggested asking for written comments.
Noting most surveys generically ask about HIPAA compliance, the group discussed that more explicit levels of granularity (e.g., compliant with the claims, or ready to use an identifier not assigned by them) were needed in order to make a recommendation. They also needed to establish the replicability of the factors that made these organizations successful
Dr. Cohn distributed a list of issues for members to reflect on and discuss, along with letters the group had received, at the June 27 breakout session. He noted they needed to look into the code set issues by the end of the year. The hearing in August was focused on PMRI standards and, hopefully, on some model issues. They had tentatively scheduled hearing dates in October and December and were holding November dates open. The Subcommittee needed to decide whether to hold a hearing as part of the WEDI SNIPS success conference (November 12-14, in Orlando) to better understand the industry’s successes, issues, and barriers. Members would be surveyed for interest. They would determine in June if a hearing in that context would be useful. Dr. Cohn noted that letters received from developers requesting particular external code sets be named in the HIPAA regulations were referred to the DSMOs for comment. The Subcommittee would begin to look into some of those issues at hearings around the end of the year and would obviously ask them to testify then. Recalling that Mr. Reynolds observed there was no prize for being first, Dr. Zubeldia noted that in previous meetings the Subcommittee discussed recommending to the Secretary to explore incentives for the implementation of HIPAA. Dr. Cohn asked him to reflect on it and further develop a proposal that aided an early successful implementation.
Dr. Cohn expressed hope that with careful reading of the testimony, introspection and enlightenment they might come up with useful recommendations to the Secretary to ensure early, successful implementation. Thanking everyone for their forbearance in dealing with difficult issues perplexing the industry, he adjourned the meeting at 12:15 p.m.
I hereby certify that, to the best of my knowledge, the foregoing summary of minutes is accurate and complete.
/s/ Simon P. Cohn 6/3/2003
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Chair Date