Statement of the American Medical Association
to the
National Committee on Vital and Health Statistics’
Subcommittee on Standards and Security

Regarding HIPAA Electronic Claims Attachments

Presented by Jean P. Narcisi

December 10, 2003

My name is Jean Narcisi.  I am the Director of Electronic Medical Systems for the American Medical Association (AMA).  It is my pleasure to appear today on behalf of the AMA before the Subcommittee on Standards and Security of the National Committee on Vital and Health Statistics (NCVHS).  I would like to thank you for the opportunity to testify.

The AMA defines a claim as the submission of information by a physician or insured individual to a third-party payer using a standardized format (e.g., CMS 1500 paper claim form or HIPAA electronic format) sufficient to establish that covered health care services were provided. The claim includes a request for payment or reimbursement to the physician or insured individual.

The AMA believes that an attachment would include information either requested by the payer based on pre-payment or post-payment follow-up or provided by the physician at the time of submission of the claim. Attachments consist of information, presumably not available on the initial claim (or claim format), that provides further supporting details on the claim.

Attachment information should include (1) information that tends to be highly situational in nature (e.g., requested only for specific types of services) and (2) cannot be readily accommodated in a standardized paper or electronic claims format. Attachments should accommodate a variety of paper and electronic technologies and should allow for structured data elements, images, and free form text as appropriate. In addition, physicians should have the ability to submit attachments at the time of claim submission and should not have to wait for a payer query or specific attachment requirement (e.g., to explain the unusual circumstances associated with a pattern of treatment).

Physicians are currently asked for a variety of supporting information to adjudicate a claim. This can include information that is contained in the patient medical record such as operative notes, test results, etc., or information to substantiate the level of service provided.  Other attachment data includes additional administrative information dealing with patient eligibility (e.g., copies of driver’s licenses, social security cards, Medicaid cards, etc.).  Many physicians are also asked to verify information of the patient’s relationship with the insured and other information to assist in coordination of benefits (COB).  Often, this COB information is not readily available to the physician.

In addition, some payers, especially Medicare and Medicaid, request attachment information using special forms to reflect patient consent, the medical necessity of ordered durable medical equipment, the advanced beneficiary notice (ABN), and the cost and duration of use of drugs and supplies. The methods by which this information is requested depend on the specific payer, the physician’s relationship with the payer, and their technical capabilities. Submissions can sometimes be made electronically if a payer has an electronic form in place. All too often, however, even when the claim is submitted electronically, the physician must send in the attachment information manually. In some instances, and also contributing to cost and inefficiency, payer requests can be satisfied via the telephone.

Frequently, based on expectations of payer requirements, or specific written requirements, physicians submit additional information with each claim of a certain type so as not to delay reimbursement to the patient or payment to the physician. Lack of standardization across or within payers is a serious problem.  Searching the patient’s medical record or administrative file well after the original claim is submitted to gather the additional information and place it in the format required by the payer creates undue burdens on physicians.

The AMA believes that, in some instances, these attachment and documentation requirements involve payers’ legitimate needs for sufficient information to assess coverage, or justification for specific types of services, or to meet contractual or regulatory requirements. All too often, unfortunately, many physicians have concluded that these requests are intended to delay payment of claims or to provide a basis for unwarranted denial. Also, they may often reflect a desire to pressure physicians into billing at a lower level of service.

The AMA has found that requests do vary considerably across payers. This causes substantial cost and delay for physicians. This variation includes when attachments are requested, in what format they should be submitted, and the availability of electronic submission.

The AMA believes that considerable strides can be made on the attachments issue.  The AMA also believes that standardization and electronic exchange of attachment information would reduce the workload for both the requestor and the respondent to attachments, and that this could ultimately result in cost savings. In order to work, this standardization must apply to all payers and cover both paper and electronic formats. Standardization will be more difficult in the private sector, where contractual provisions vary across and within specific companies.

In addition, it is essential to standardize when attachments are required and not just how they are submitted. The AMA is very concerned that lack of standardization in the circumstances when attachments will be required will lead to an increased burden on physicians. The current HIPAA implementation guides for the claims transactions are very complex and include many confusing statements regarding the requirement of certain data items.  For example, the requirement for a physician to report certain items in a claim is conditional on a specific situation. Many of the situations are not clearly defined in the implementation guides. This means that some payers will require a particular data item and others will not.  Therefore, the AMA is concerned that the payer or governmental response to the HIPAA standardization of the claim will be an expanded use of attachment requests to circumvent claims standardization.  Administrative simplification will not be achieved for physicians if each payer requests differing amounts of additional material as an attachment.

The AMA believes that standardization of formats and electronic exchange should reduce the costs of preparing and submitting attachments and enable physicians and the health care system to realize the full benefits of electronic data interchange and administrative simplification. At the same time, as indicated above, accomplishing such partial standardization without standardizing when attachments are required could make matters far worse. Given the current extent of physician use of electronic medical records, the state of standardization of such systems, and the lack of standardized links between clinical and administrative systems, the costs of obtaining attachments information from existing electronic or paper medical records and then placing it into standardized electronic formats could be prohibitive.

Fundamentally, the AMA believes that the HIPAA mandate for claims standardization, as well as electronic claims formats that were intended to be designed to be less constrained than the paper formats, provides a conceptual, regulatory, and technical framework to reduce or eliminate much attachment use. Although the HIPAA transactions recently implemented provide a standardized format to transmit a claim, the data requirements of each payer are far from being standardized. Obviously, contractual provisions vary across and within specific companies resulting in different data requirements.  Nevertheless the number of “companion documents” developed by the payers makes it difficult for the physicians to determine exactly what data is necessary to process a claim for each payer.

The AMA suggests that the current system for submitting claims and other transactions in the HIPAA format should be fully operational by all payers and physicians that submit electronic transactions before the claims attachment standards are adopted as HIPAA standards. As I stated previously, it is the position of the AMA that the health care industry should standardize when attachments are required and not just how they are submitted.  Guidelines also need to be established regarding the type and number of requests for information that should be permissible from payers to physicians. The attachment standard has been designed so that a payer can send an electronic request or several requests for additional information.  Physicians should know up front what additional clinical information will be required for specific services so they can either submit it with the claim or when the attachment data or images are available.

The AMA also believes that there should be an organization or group, other than those responsible for developing the messaging transactions, responsible for developing the type of requests for information that should be permissible from payers to physicians as well as what additional clinical information will be required for specific services of claims attachments transactions. This organization should be representative of all parties affected by health care electronic data interchange (e.g., providers, payers, standards development organizations, regulatory agencies). Based on their structure and current and anticipated responsibilities, the National Uniform Claim Committee (NUCC) and the National Uniform Billing Committee (NUBC) are appropriate to assume this task.

The NUCC has an official operating protocol that provides full due process, open meetings, and the ability for non-members to generate agenda items. Fundamentally, data content for business processes around claims submission and claims payment should be maintained through committees, like the NUCC and the NUBC, that focus on formal, balanced representation of key parties using a consensus approach to decision-making. Maintenance of the data content and their related business functions is a policy related activity.  Therefore, it should be conducted through the kind of public/private partnership that these two committees exemplify. Claims and attachment standards should not be viewed as primarily technical communications standards.

In addition, the AMA believes that standard implementation guidelines for code sets are essential for uniform national application of the code sets. If standard guidelines for medical code sets were adopted, many attachments would be eliminated. If health plans and physicians are permitted to implement and interpret medical data code sets as they see fit, the purpose of Administrative Simplification will not be achieved.  An important part of Administrative Simplification and reduced regulatory hassle certainly includes the simplification of instructions for the coding of health care services.  The overwhelming amount of paperwork to which physicians are subject would be significantly reduced if coding guidelines were standardized within electronic transactions. The AMA believes that the CPT guidelines and instructions should be specified as a national standard for implementing CPT codes.

The instructions and guidelines contained in the CPT Book are subject to the same rigorous editorial process used to develop CPT codes.  The CPT Editorial Panel and CPT Advisors consider CPT section guidelines, specific code level instructions and definitions, and the application of modifiers at the same time the language for CPT code descriptors are developed.  Thus, proper use of CPT codes is based on all the associated material contained in the CPT Book.  For example; simple, intermediate, and complex repair are defined in the book prior to the actual repair codes so that users understand the circumstances for reporting each.  Also, coding conventions, such as add-on codes, are explained in guidelines.  The use of codes and descriptors apart from this information limits the functionality of CPT and its uniform application and contributes to improper coding interpretations which are counter to the purpose of having national standard code sets.

Therefore, the AMA strongly encourages the Subcommittee and the NCVHS to recommend that the CPT guidelines and instructions for applying the codes also be included as a national standard.

As stated previously, the AMA believes that standardization of formats and electronic exchange should reduce the costs of preparing and submitting attachments and enable physicians and the health care system to realize the full benefits of electronic data interchange and administrative simplification. However, until standardization is achieved regarding when attachments are required and not just how they are submitted, the use of the attachment standards should remain optional and based on trading partner agreements between physicians and payers.

Thank you for this opportunity to present the views of the American Medical Association.  I would be pleased to respond to any questions that you might have.