New Medicare E-Claims Standards to Go Into Effect in 2012

Beginning January 1, 2012, all electronic medical claims must comply with HIPAA's 5010 electronic data interchange (EDI) standards (currently version 4010 is in use). Any claims that fail to meet the 5010 standards after that date will not be paid. This is true for claims filed with public payers like Medicare and Medicaid, as well as for claims filed with private insurers.

If you file your own electronic claims, the company that provided your claims software should have already given you an updated package, or at least sent you information on how to obtain the new version. If you use a billing service or clearinghouse, you should check with that service to ensure they're ready to use the new version.

The 5010 standards call for more specificity in the way data are entered and transmitted. On the simplest level, the standards require nine-digit ZIP codes instead of the previously acceptable five-digit ZIP codes. On a more complex level, physicians will be able to provide more diagnostic information, permitting a distinction to be made between a principal diagnosis, an admitting diagnosis, external cause of injury, and the patient's reason for the visit. The standards also support the monitoring of certain illness mortality rates, outcomes for specific treatment options, some hospital lengths of stay, and clinical reasons for care, all of which should be useful in the new era of accountable care. The 5010 standards are also set up to use the ICD-10 diagnosis codes, which must be used begining October 13, 2013. For psychiatrists, the DSM-IV-TR provides a crosswalk to the ICD-10 codes in Appendix H.

The Centers for Medicare and Medicaid Services has posted information online, including check lists, about what you need to do to make this transition occur smoothly at <www.cms.gov/ICD10/downloads/w5010BasicsFctSht.pdf> and <www.scanhealthplan.com/documents/hcc/icd10/FullEncounterDataSubmission/5010Provder_Action_Chklst.pdf>.

Small practices that are exempt from filing claims electronically (practices with fewer than 10 full-time employees) may continue to file paper claims, and if they do no other electronic transactions, they may continue to operate outside HIPAA's requirements. However, note that small practices are not exempt from complying with the requirements to use electronic prescribing and keep electronic health records. Physicians who fail to meet these requirements may see decreases in their Medicare payments starting next year (see Changes Proposed to E-Prescribing Program).

The AMA is warning its members to prepare for possible cash-flow problems in January—not necessarily because physicians are not in compliance with the new standards, but because technical problems may occur as everyone makes the shift.

You should test your ability to file claims using the 5010 standards as soon as possible or check with your third-party biller to ensure it is able to comply with the new rules.