Home Health & Hospice Week

Medicare contingency plan will permit non-compliant claims. 

Home care providers who feared the Oct. 16 compliance deadline for the Health Insurance Portability and Accountability Act transactions and code sets rule would result in a cash flow disaster can breathe a sigh of relief.

The Centers for Medicare & Medicaid Services Sept. 23 conceded that too many providers simply aren't ready to submit HIPAA-compliant claims. The agency says it will implement a contingency plan to accept noncompliant electronic claims for an as-yet undetermined period after the HIPAA transactions rule deadline.

"Implementing this contingency plan moves us toward the dual goals of achieving HIPAA compliance while not disrupting providers' cash flow and operations," says CMS Administrator Tom Scully.

CMS revealed it was considering a contingency plan on Sept. 8 (see pdf of Eli's HCW, Vol. XII, No. 33, p. 260). It decided to move forward with the plan after analyzing data that showed "unacceptably low numbers of compliant claims being submitted."

New Deadline A Moving Target, But Providers Should Get HIPAA-Compliant ASAP 

CMS says the contingency plan will give providers more time to complete the testing process, and that the agency will "regularly reassess the readiness of its trading partners to determine how long the contingency plan will remain in effect."

The big question now: Will other payers follow suit? "We encourage other plans to assess the readiness of their trading partners and implement contingency plans if appropriate," says Tom Grissom, director of CMS' Center for Medicare Management.

At least one health plan, BlueCross BlueShield of South Carolina, says it "temporarily will continue to accept electronic transactions from current submitters in HCFA 1500s (private practice) and UB92 (hospital) formats after the Oct. 16 deadline."

"BlueCross is prepared for HIPAA, but our assessment ... indicates that it is necessary for us to adopt a contingency plan to prevent the possible disruption of cash flow" to providers, David Boucher, BlueCross' assistant vice president of health care services, says in a statement. "Of the 9,000 providers, fewer than five percent have tested with us for HIPAA readiness and even fewer have been successful," Boucher adds.

Despite the delay, experts advise providers to act quickly to get their houses in order, since the contingency plan won't remain in effect forever.

Editor's Note: For more HIPAA information, see Eli's Health Information Compliance Alert and Eli's HIPAA Training Alert at www.eliresearch.com.