[This Transcript is Unedited]

National Committee on Vital and Health Statistics

Subcommittee on Standards

Hearing on HIPAA and ACA Administrative Simplification – Phase IV Operating Rules and Attachment Standard

February 16, 2016

Hubert Humphrey Building
200 Independence Avenue, SW
Washington, DC 20024



Agenda Item:  Welcome and Introductions

DR. SUAREZ:  Thank you so much everyone for your flexibility and your understanding with the weather that we had here in DC.  I am very excited to welcome you all here to the Department of Health and Human Services and to the National Committee on Vital and Health Statistics.  My name is Walter Suarez.  I am the chair of the National Committee and a member of the Standards Subcommittee, which is hosting this hearing.

We are going to expedite a lot of the steps here.  We do want to have introductions.  For those that are members of the committee, if you can introduce yourself and state if you have any conflicts or no conflicts.  And then we are going to go to very quickly just for everybody to say your name and organization and then we will turn it to the co-chairs of the Standards Subcommittee for a couple of quick of comments and then we will get started.

Again, my name is Walter Suarez.  I am with Kaiser Permanente, chair of the National Committee and no conflicts.

MS. DEUTSCH:  Terri Deutsch, lead staff for the Standards Subcommittee and Review Committee.

DR. LANDEN:  Rich Landen, QuadraMed, no conflicts.

DR. LOVE:  Denise Love, National Association of Health Data Organizations, no conflicts.

DR. COUSSOULE:  Nick Coussoule, BlueCross BlueShield of Tennessee, committee member, no conflicts.

DR. SORACE:  Jim Sorace, ASPE staff, no conflicts.

DR. BARBER:  Stacey Barber, chair, ASC X12 and Insurance Subcommittee.

DR. ARGES:  George Arges with the American Hospital Association.

DR. KOCHER:  Gail Kocher, Blue Cross Blue Shield Association.

DR. GREEN:  Christol Green, Anthem Incorporated.

DR. WILSON:  Sherry Wilson, President of Cooperative Exchange.

DR. TENNANT:  Rob Tennant, Medical Group Management Association.

DR. LOHSE:  Gwen Lohse, CAQH CORE.

DR. NARCISI:  Jean Narcisi, American Dental Association and chair of the WEDI Board.

DR. WALLER:  Pat Waller, Cambia Health Solutions.

DR. SQUIRE:  Marietta Squire, staff to the Subcommittee.

DR. MCCOMAS:  Heather McComas, American Medical Association.

DR. STELLAR:  Charles Stellar, WEDI.

MR. NACHIMSON:  Stanley Nachimson, Nachimson Advisors.

DR. LAZARUS:  Steve Lazarus, Boundary Information Group, representing CAQH CORE.

DR. WEIKER:  Margaret Weiker, NCPDP.

MR. DAY:  Durwin Day, HCSC.

DR. THORNTON:  Jeanette Thornton, America’s Health Insurance Plans.

DR. DECARLO:  Mike DeCarlo, Blue Cross Blue Shield Association.

MR. ST. JACQUES:  Don St. Jacques, Jopari Solutions.

DR. NEREU:  Jennifer Nereu, Jopari Solutions.

DR. WEBER:  Erin Richter Weber, CAQH CORE.


DR. BEATTY:  Gary Beatty, UnitedHealthcare and chair of ASC X12.

MS. KNAPP:  Katie Knapp, Department of Veterans Affairs.

DR. PHELPS:  Ruth-Ann Phelps, Veterans Affairs.

DR. BRUNS:  Chris Bruns, Healthcare Administration Technology Association.

DR. NIEMEYER:  Suzanne Niemeyer, Ketchum.

DR. WILLMAN:  Ken Willman, ZirMed.

DR. EISENBERG:  Christopher Eisenberg, CMS.

DR. SCHUETH:  Tony Schueth, Point-of-Care Partners.

DR. HINES:  Rebecca Hines.  I am with the committee and CDC and CHS.

DR. SUAREZ:  Now, we are going to go to the phone.  Members of the committee that are on the phone, if you could introduce yourselves.

DR. SOONTHORNSIMA:  Ob Soonthornsima, CVS Health, member of Full Committee, co-chair of Standards Subcommittee and co-chair of Review Committee, no conflicts.

DR. SUAREZ:  Any other members?

DR. LINCOLN:  Mike Lincoln from VA.

DR. SUAREZ:  Thank you.  Other people on the phone?  Do we have anybody else on the phone at this point?

DR. BURCKHARDT:  Walter, this is Laurie Burckhardt with WPS Health Solutions.

DR. SUAREZ:  Thank you.  Anyone else?  Thank you again very much for joining us.  I am going to turn it to Ob for a few intro remarks and then we will go to Terri for some logistical description of how the day is going to flow.

DR. SOONTHORNSIMA:  Thank you very much, Walter.  Thank you everybody for being here today and also on the phone.  The purpose of the hearing today is to gather industry input regarding two areas to consider for making recommendation for adoption to the secretary.  The first one of course is Phase IV Operating Rules for selected HIPAA Transactions, enrollment/disenrollment, premium payment, health care claims and prior auth.  The second area that we are going to cover late in the day will be the Claim Attachment Standards and Code Sets.

Without any further ado, in the interest of time, I would like to turn this over to Terri to go over the logistics and revised agenda.  Again, it is going to be very time – we are pressed with time.  Terri, could you go over the agenda please?

MS. DEUTSCH:  Thank you very much.  Good morning everybody.  I am just really pleased that so many people have shown up despite all this weather.  Thank you all for coming.

We do have a revised schedule.  It is coming off the press shortly.  But just to let you know, your time that you have allocated for speaking has not been cut.  What have been made a little shorter are some of the breaks and some of the conversations that we have.  If everybody sticks to the five minutes, which I know you all will, we should be able to get out at around six.  I will just let you all know and keep you moving so that we can get this done.

The following panel, if you can start moving towards the table as the questions and answer for the previous panel, that would really help so we do not have too much down time.

I just want to also let all of you know that the cafeteria is going to be open for lunch until 2 o’clock.  You will be served for food.  And the break has been scheduled at that time so you will be able to have that.

If anyone on the phone cannot hear, please send me an email.  I do have my BlackBerry.  I will make sure that that message is conveyed.  If there is any other information, we will just interject it through here.  Do you have any questions before we start?

DR. SUAREZ:  A quick question.  Roughly, the time for starting the second part of the hearing today, the attachments, do you have a sense of around what time it will be?

MS. DEUTSCH:  The attachments should be starting around, this is an approximation, 3:50.  If we move then we will be able to do it a little earlier, but it is definitely going to be in the later part of the afternoon.

DR. SUAREZ:  Someone else join the phone.  I just want to make sure.  Alix, are you in?

DR. STRICKLAND:  Deb Strickland joined.  Sorry.

DR. SUAREZ:  Deb, thank you.  Just to check in, Ob and others on the phone, is the WebEx working on your end?

DR. SOONTHORNSIMA:  Yes, it is.  Thank you.

DR. SUAREZ:  We are all set.  Anything else, Ob or Terri?  We will just launch on.  Quickly, any other people join the phone?

MS. GOSS:  Good morning.  This is Alix Goss – for being a few minutes late with some technical glitches.

DR. SUAREZ:  Thank you so much, Alix.  If you could introduce yourself in terms of member of the committee and no conflicts.

MS. GOSS:  Will do.  Thank you, Walter.  Hello everyone.  This is Alix Goss from the Pennsylvania eHealth Partnership Authority.  I am a member of the Full Committee and co-chair of the Standards Subcommittee and Review Committee and looking forward to today’s hearings.

DR. SUAREZ:  Great.  Thank you so much, Alix.  We are going to go ahead and start.  We are starting with an overview of proposed operating rules.  I think, Gwen, you are going to be taking us there.

Agenda Item:  Part 1: Proposed Operating Rules

Agenda Item:  Overview of Proposed Operating Rules

MS. LOHSE:  Thank you to the committee.  I am Gwendolyn Lohse from CAQH CORE, the managing director for CAQH CORE and the deputy director for CAQH.

With the testimony overview, just going to do a level set.  There are a few new committee members on who CAQH CORE is, what the vetting process is that are used against all the rules and then drill down into the Phase IV rules for the market impact, the requirements.  You highlighted in a lot of the questions the lessons learned both from existing operating rules and also the ACA Review Committee so we specifically spoke to those.  And then just talk about implementation support and a recommendation to NCVHS from CAQH CORE on the Phase IV rules.

CAQH CORE is a nonprofit.  It is multi-stakeholder.  It has over 130 participants.  Its current chair is the CIO from CHRISTUS Health, which is a large health system.  It was voluntary launched as a collaboration before the reform bill and it became the HHS-designated author due to an application process.

In less than ten years, CAQH CORE has created four phases of rules, associated education, a certification process measurement and maintenance of all of those phases.  There is public/private involvement in all parts of the integrated model, including from Medicare, Medicaid, the Veterans Affairs and other agencies.

Both CORE and non-CORE participants are involved in all pieces of the integrated model.  And when I speak to the integrated model, I mean the research and development, the rule writing, the building awareness, the education, the promotion, the certification, the maintenance, and the reporting status.

The non-CORE participants attend calls.  Actually, a lot of them are on education sessions and a number of them become CORE certified or asked their entities to become voluntarily CORE certified their vendors.

There are over 250 CORE certifications at this point.  I will be glad to say recently that includes 15 Medicaids within the last few months.  I think that is a tribute to everyone in this room as well as across the industry that we are really moving at a good pace at this point.

Guiding principles.  All CORE rules are based on a set of guiding principles and a scope and a vetting process.  Some of the guiding principles are listed here.  I wanted to highlight a few.  They are vendor agonistic always.  They never repeat or conflict with the standards.  They work in unison to complement the recognized standards, both HIPAA standards, as well as industry-neutral standards.  There is incorporation of an agile maintenance process that we have used with Phase III quite a lot and have incorporated into Phase IV.  They are based on best practices and market-tested results.  We are not passing rules that have not been used in the marketplace.  They are based on what will work.  They have an affiliated, yet separate voluntary certification requirements.

There are two parts to the rules that are allowed for regulations, both infrastructure and data content.  That is per HHS regulations that are in existence.  And the vetting process is an extensive and multi-layered.  Its rules focus is set by participants based on public input and research.  There are several subgroups that report out to work groups and all CORE vote and then a board approval of that.  The rules are publicly available for free.  There are required quorums and approval rates throughout the whole process.  And the final vote is focused on just those that have to implement, those meaning providers, practice management systems, vendors, clearinghouses, and health plans.  Those are the ones that actually are feeling the bad debt, are hiring, firing, picking the IT systems, et cetera.

How do we apply that Phase IV vetting process or that vetting process to Phase IV?  It was a two and a half year development time from the initial public outreach to issuance of the rules.  Less than three months after CORE was appointed and named by the secretary, we reached out to both CORE and non-CORE entities about seeking ideas for their options for rules.  There were over 100 non-CORE participants that participated in that process.  They also helped rate the options.  They came up with the idea as they rated the options.  There were over 70 conference calls by the various subgroups and work groups during the rule development process.  Minutes and other required documents were all available and we are welcome to show it to you.  Those include straw polls, evaluation rating criteria, minutes, comment adjudication for every single comment.

And then the initial rules.  Once they were created were made available to the public for free on the website and then also highlighted on the open CORE town halls.  The required quorums were exceeded at every single stage whether it was a straw poll or an actual vote.  And over 130 entities were involved in that, both HIPAA and non-HIPAA.

The final vote did exceed – all the stages exceeded.  It had 90 percent participation and 88 percent approval.  And the CORE Board unanimously approved the rules.

NCVHS, as you all know.  You were updated mid-point during the process.  And then we also sent you a letter less than a month after the approval with the links to all the rules.

That answers some of the questions.  What are the rules?  This gives you an overview of what the rules are.  And just to walk you through it on a high level.  Before transactions are up on the top and then the infrastructure is on the left hand side.  As I will talk a little bit later, these are infrastructure-focused rules.  For those of you that are new to process, infrastructure means the flow, the response time, the acknowledgement, the system availability, the documentation requirements from the health plans and the entities.  This is an infrastructure-focused first package of rules.

You will see that batch for real time is required for all the rules.  And then depending on which is picked, there are processing mode requirements and acknowledgement requirements.  And then is a Safe Harbor connectivity and I will talk about what Safe Harbor means, but it means you have to offer it out and that you can offer other methods, but you need to offer out this one method.  And then a companion guide template and a few specific infrastructure rules that targeted these transactions, which I will also highlight.  That is a very high-level overview.  I am keeping to the timeline so I am going to go fast.

Impact and benefit of the CORE Operating Rules.  I did mention earlier that none of the rules are based on things that do not exist.  These are best practices in the market place.  You are seeing increased consistency on automation across the entities.  All these transactions have many different companies involved in passing them.  Things like response time require time stamping and allows entities to work together to figure out the issues, identify gaps or barriers, increase the automation of the transactions.  We have a study of about 4.2 billion transactions.  We know there is value to both the health plans and the providers to use these and we have those numbers to share with you.  More efficient processing results and reduced staff for phone inquiries and also enhance revenue cycle management especially around the claims.

What are some of the lessons learned as we sit back from – we have gone over the requirements and what have we learned here?  These are to drive efficiency and cost reduction; yet, they are achievable and operational.  You had asked are the things operational.  Does it have efficiency?  The public at large and the CORE participants decided a first significant staff was to focus on infrastructure and then to add the data content later.  These operating rules drive cost reduction and be achievable, and they push investing best practices out to the whole industry.  As the CAQH index, which I highlighted studies 4.2 billion transactions cost and adoption, there is value to be had and cost savings.

It is flexible in a number of ways.  I highlighted two of them here.  The operating rules are payload agnostic.  This is really important.  I am sure Stacey will talk to this later.  They can be used with any version of the X12 standards.  Other industry-neutral standards like JPEG and PDF – important to the attachment or other content-focused standards, which is important to the discussion about attachments like the HL7 C-CDA.

The CORE board did write a statement to you all as a committee in the summer that they have publicly stated whether the CAQH CORE adds more content using v5010 or supports, another version of the X12.  They can be used with these operating rules.  Additionally, there is a pilot that CORE is doing for the attachments and again can be used for these operating rules.

Phase IV, also another way for flexibility.  There is ongoing, transparent maintenance built into these with the connectivity rule.  Rather than waiting on that mandate, such maintenance allows and expects the industry to collaborate in involving industry needs rather than waiting for mandates to do that.

Two things.  You asked about consistency and compatibility.  Also, what have we learned from that during this process?  The operating rules in Phase IV mirror and were built upon the operating rules that previously were implemented.  All the transactions strongly would value from a common infrastructure set, and that is what we would now have.  Additionally, there is a lot of cost savings to apply the same infrastructure to these operating rules as previous rules.

The rules do require trading partner collaboration, like the other operating rules.  There are a few targeted requirements than the previously mandated.  I am going to go over those.  Those are due to the uniqueness of the transaction.  Additionally, the connectivity area removed optionality from the previous rules based upon criteria that the group felt was essential.

A final thing here.  Voluntary rules, which are voluntary right now.  The Phase IV rules and the voluntary CORE certification requirements, are separate documents.  Both had absolutely unanimous support, overwhelming support.  And they are separate documents.  This allows HHS to consider the Phase IV rules for mandate while CAQH CORE can move forward with pushing voluntary certification.  And the CORE certification applies to vendors, health plans, practice management systems and large providers.  And many entities have already agreed that they will and has stated their support to become certified.

Another lesson learned is effectiveness and that CORE guiding principle to align with other HHS initiatives.  This called for enhanced security.  A few entities have expressed that this enhanced security is too costly or it does not align with earlier versions.  The optionality was removed with the CORE connectivity in Phase IV.  Previously, you could have password and user name.  That no longer exists.  You now have to offer out digital certificates, the X.509 and the TLS 1.2.  The overwhelming majority of participants felt that it is a higher risk not have this than to have it and the cost.  This aligns with the Federal Information Processing Standards, FIPS, and also clinical data exchange standards that are evolving through meaningful use and other places.

The connectivity rules also are a Safe Harbor.  These requirements on greater security can be used with earlier phases of the connectivity rule.  They are backward compatible.  Moreover, maintenance is allowed for in the evolution.

Two more lessons learned and then I will move to the implementation.  Piloting and best practices and effectiveness.  You had asked how they impact this.  They called for the inclusion of acknowledgements.  You, as a committee, have several times called for HHS to adopt acknowledgements.  Acknowledgements are already required in the health insurance exchanges.  Phase IV included a study of the health insurance exchanges.  We are happy to share it with you.  They are being used and required by HHS for the premium payment and the enrollment and disenrollment today.  They are used by managed Medicaid and all CORE-certified entities for previous phases must use acknowledgements –  they get tested on them.

Additionally, some have stated that they are actually using the acknowledgements for the current transactions in Phase IV.  This is happening as a best practice.

Some say this is out of compliance.  We have done a legal analysis and we have shared this with X12, that legally the operating rules can and should include acknowledgements and we are happy to share that previous documentation with you.

Another lesson learned.  There is no ambiguity.  This called for outlining real time and batch.  A few believe that operating rules should not address real-time processing for these transactions.  The majority felt that it was clear real-time processing is occurring.  It is very minimal, but it is occurring.  And there is a need to establish basic response times and time stamping if used.  It is not required if used.

Thoughtful industry dialogue occurred in order to establish these expectations of real-time processing, but not requiring it.  And the operating rules explicitly do not apply to real-time adjudication.  I heard these phone calls.  They were extensive.  And the industry felt like they need to start establishing some expectations.

Based on those requirements, some of the lessons learned and where we are going.  You asked about implementation, and a few points here.  CAQH CORE integrated model is committed to implementation.  We have already issued an analysis and planning guide.  These are popular tools that are being used in earlier phases like gap analysis sheet, system inventory and impact assessment. There is a number of Phase IV FAQs already on the website.  Those are based on a request process that is open to CORE and non-CORE participants and is free.  We do track all the questions that come in and the response time.

The CAQH index, which I mentioned earlier, tracks the cost and the level of adoption for each of the HIPAA-mandated transactions.  They have added on this year all the transactions that in Phase IV.  There is a range of entities that are starting to supply information on these transactions.

Education.  There have already been two CORE Town Halls on the Phase IV rules, and two specific calls on the Phase IV rules.  The attendees and the registrants are up there for the Town Hall.  There are over 400 registrants.

And then throughout 2016 and beyond, we will be holding a number of webinars that both CORE and non-CORE participants will present on, showing their implementation.

You asked also about enforcement and tracking tools.  We do obviously use the index to track adoption, but also CORE certification.  The CORE authorized testing vendor and any entity become a CORE-authorized testing vendor is on track to have the site built by the summer of 2016 this year.  Beta testing is scheduled for the spring.  A range of entities have already volunteered from each of the stakeholder types to test that beta site.  And then the actual CORE certification seal for Phase IV will be available for application in the summer of 2016.  And the application process includes testing, which is interactive testing with this test site, and then a whole range of application documents.

I will wrap up with our recommendations.  With regard to the Phase IV rules. We are asking that NCVHS should communicate to HHS your support of the Phase IV rules.  They do meet the ACA mandate.  Be specific that your support includes all the Phase IV Operating Rules especially acknowledgements.  Time is of the essence, not just for Terri and our committee, but generally, time is of the essence.  I am trying to go fast here.

Experience shows that after a regulation’s adoption date, the health data exchange arena, it can take the health market two years to fully move towards compliance.  We do not have a lot of time here to waste.  Basic foundational needs like the Phase IV rules, must be in place throughout the whole US health care system if we are going to tackle new challenges like value-based arrangements.

There is a need for HHS to support industry-wide education and tracking for all the regulatory requirements that were issued in the reform bill regarding HIPAA transactions.

As we are already seeing with the Phase I, II, and III rules, we are moving CAQH CORE forward with extensive efforts to educate, support, and track.  We would welcome NCVHS’ and HHS’ collaboration of this work.  Just to add, we do collaborate with most everyone, I think everyone in this room.  We are going to continue to be doing that because this is a team effort.

Thank you.  I think I stayed on time.  I tried to make it fast.

DR. SUAREZ:  Thank you very much.  Thanks for that overview.  I think it is quite helpful for all us really to know where things are and what your recommendations are.

We are going to go now into the panel.  We are starting with health care claims.  I know, Gwen, you have a few intro words about the health care claim operating rules specifically and then we will go to our industry perspective.

Agenda Item:  Panel 1 – Health Care Claims

Agenda Item:  Overview of Proposed Operating Rules – Claims

MS. LOHSE:  We talked about applying consistent infrastructure across all the transactions.  There are a few places where additional requirements were made.  One of them is around the claim and specifically the companion guide rule.  It was one of the infrastructure rules.  Every entity has to publicly put out their companion guide.  The same flow and format must be used by every single entity.  Those that are following them do not have a million different tables of contents to read.  They can actually know where to go.

Within the claims rule, there is a requirement to have COB information.  And the reason this happened is that you have seen and I think you have heard this at the Review Committee in June 2015 last year.  COB continues to be a challenge for some claims.  It is costing the industry millions of dollars, both on the provider side and on the health plan side.  COB is coordination of benefits, for those of you that may not be as familiar.  I think everyone is.  What was seen as an essential component to make sure those COB requirements were out in the market.

Additionally, the claims acknowledgement is incorporating and does speak to the individuality and the challenges with the claims.

DR. SUAREZ:  Thank you.  Thanks so much for that additional information about the claim itself.

We are going to into the industry panel.  We are going to go down the list based on the original agenda.  I think we have Christol Green first from Anthem.

Agenda Item:  Industry Perspectives on Operating Rules – Claims

MS. GREEN:  Thank you and good morning.  Thank you, Mr. Chairman and members of the Subcommittee, for allowing me to testify today on the proposed operating rules on claims transactions.

Anthem has also written a more inclusive and testimony and has given that to the Subcommittee.

I am Christol Green.  I work with E-Solutions Division within Anthem, Incorporated.  I have been working on HIPAA Transaction and Administrative Simplification for over 20 years now.  I am a current member of WEDI, ASC X12, Health Level 7, and the National Plan Automation Group, along with other health care-related industry organizations.  I currently serve as chairperson for the National Plan Automation Group.

With over 72 million people served by its affiliated companies, including more than 38 million enrolled in the family health plans, Anthem is one of the nation’s leading health benefit companies.  Anthem is currently a CORE certified health plan with the Council for Affordable Quality Healthcare.

On behalf of Anthem, an organizational member of America’s Health Insurance Plans, AHIP, and the Blue Cross Blue Shield Association, I would like to thank you for this opportunity to respond to the subcommittee questions and provide our perspective on the proposed operating rules.

We hope that sharing our experience and recommendations with NCVHS will help improve efficiencies and usage of health care electronic transactions.

The operating rules on claims along with the other Phase IV Operating Rules are really truly concentrated on infrastructure requirements.  The claims operating rules to us do not conflict with the existing standards as they cover connectivity and security requirements in regards to the exchange of 837s between business entities and training partners.

These operating rules do not provide a complete set of information needed to achieve the purpose of the claims transaction due to the lack of data content being addressed.  We know we will be getting at that later.

In regards to the Safe Harbor provision, we recognize that the Safe Harbor limits the industry’s ability to ensure consistent methodologies used across all stakeholders.  This is not cost effective we feel in the long term.  However, the Safe Harbor is critically important in the short term as not to disrupt our existing operations with current electronic trading partners.  Therefore, we recommend that the Safe Harbor be kept in place in the near-term and that the industry has adequate lead time and notification to handle any phase out or transition.

Initially, we had concerns with the added technical, processing mode and connectivity, until Safe Harbor was included and explained.  Some of our concerns were as follows.  The chosen processing and connectivity modes as outlined in Phase IV may not be the most secure options.  Also, Anthem would have to migrate all of our trading partners, which is substantial, to these new processing modes and connectivity options.  It would be timely and costly not only for us, but for our trading partners.  They would not have the current options that although are secure today in order to continue to do business with us.

Flexibility in the operating rules to support changes in technology is critical for future security and/or connectivity methods.  The current standard minimally supports changes in connectivity.  Fast Health Interoperability Resource or FHIR is a good example of an emerging technology that could be supported in the future.

We agree that flexibility of the standards and operating rules are needed; however, we do not support multiple standards and operating rules for each business partner or transaction.

With that, I thank you for this opportunity today and I will take any questions at the end of the session.  Thank you very much.

DR. SUAREZ:  Thank you.  Thanks so much.  Gail?

MS. KOCHER:  Good morning.  My name is Gail Kocher and I am a director of National Programs for Blue Cross Blue Shield Association.  BCBSA is a national federation of 36 independent, community-based and locally operated Blue Cross and Blue Shield companies, Plans, that collectively provide health care coverage for nearly 105 million members, one in three Americans across all 50 states, the District of Columbia and Puerto Rico.

On behalf of BCBSA and its Plans, I would like to thank you the opportunity to address the Subcommittee on Standards’ questions and provide our perspective on the operating rules.  We continue to strongly support standardization, which brings value to all stakeholders within our industry.

Our Blue Plans vary widely in size, markets, and geography.  However, despite these differences, Plans report little variation in experience for a particular transaction.  The challenges and barriers to adoption of that transaction by trading partners, and the overall adoption rate of mandated standards are fairly consistent across the Plans.  Therefore, our responses to the Subcommittee are applicable to Blue Plans generally.

We continue to uphold the adoption of operating rules that support the implementation of standards, not to supplement what is already defined by the standards organizations.  Operating rules should replace neither their front matter not conflict with general usage information contained in the implementation guides.

The CAQH CORE Phase IV Operating Rules appropriately focus on infrastructure requirements, meeting the objective of business rules, which are the necessary business rules and guidelines for the electronic exchange of information that are not defined by a standard or its implementation specification.  However, the final published versions still raise a few concerns related to potential cost and business impacts that merit continued consideration by the NCVHS.

We suggest that any information technology requirements, including these operating rules, must be considered in the broader environment of mandates and requirements with significant IT implications.

The proposed for operating rules do address the exchange of transactions and connectivity between trading partners.  Plans have identified, however, concerns that these operating rules are likely to add administrative cost for both plans and their providers.  Plans anticipate that the connectivity provisions, which limit submitter authentication to a single method of digital certificates, will be costly to implement with little return on investment.  The total costs to implement will vary depending on the submitter authentication methods Plans have implemented currently.

We suggest that further broader research on the timing and costs associated with all stakeholders moving to an admittedly more secure methodology for all transactions, needs conducted.  While this is ultimately preferable to better address security concerns, it is essential that such a move is orchestrated across all standards and all trading partners rather than applying to some of the parties and a few transactions.

BCBSA supports the adoption of operating rules for claims, enrollment, premium payment, and authorization referrals.  We recognize their value in achieving the overall goal of quality and affordable health care.  Affordability and quality necessitates the exchange of patient information.  We and the Plans, however, see the need to push out additional administrative simplification provisions beyond five years so that resources can be used for other initiatives, which accelerate greater interoperability and the exchange of clinical data.  This, however, we are not including – this does excerpt the health claim attachment from that perspective.  This includes not only new operating rules, but new versions of currently mandated standards and operating rules.

Given the number of mandates with implementations in the next few years, we continue to encourage CMS to consult the National Committee on Vital and Health Statistics to develop a strategic roadmap for Administrative Simplification provisions.  This roadmap should balance all mandates from the ACA, not just Administrative Simplification provisions, along with other ARRA and HITECH mandates to work towards avoiding bottlenecks and overlapping resource commitments.  We would also request that the NCVHS work with industry stakeholders in developing such a roadmap.

We appreciate the opportunity to testify and I would be happy to answer any questions later.

DR. SUAREZ:  Thank you.  Thanks Gail.  George?

MR. ARGES:  Thank you everyone and good morning to the distinguished members of the Subcommittee on Standards.  I am George Arges.  I am the senior director of the Health Data Management Group of the American Hospital Association.  On behalf of our nearly 5000-member hospitals, health systems, and other health care organizations, including the 43,000 individual members, we appreciate this opportunity to really talk about the Phase IV Operating Rules and some of the other items that are written in our testimony.

But I also wanted to share with you a recent TrendWatch that we released in December.  It is entitled, “Administrative Simplification Strategies Offer Opportunities to Improve Patient Experience and Reduce Costs.”  This document, which we also submitted, really was intended to highlight the importance of Administrative Simplification and including the operating rules.

Our goal was not only to highlight the benefits that we have already gained as part of this process, but to generate additional enthusiasm and further commitment to the standards and operating rules.  We have included that as part of that as well as our testimony.

In terms of the operating rules with respect to the claims in the Phase IV piece, first of all, I wanted to basically indicate that the operating rules themselves are not intended to change the underlying HIPAA Standards, but really reduce the inconsistency in the data reported and describe in more specific scenarios when certain data should be used.  It is a best practice sort of approach to what to do with the Standards.

We know that CAQH’s Committee on Operating Rules, CORE, basically has done a pretty decent job early on with respect to the way they handle the information around the eligibility, including details around deductibles and co-pay amounts and enhance that value of the information exchange.  Today, we have seen improvements in that process.

We know when OFA was being kicked around in Congress, we were a supporter of operating rules.  One of the reasons we wanted to see operating rules move forward as part of this process was again to further the understanding of the standard and its practice in terms of how it is being implemented.  We see that as an opportunity to basically enhance what the Standards are intended to do.

We know that the Standards cannot be done independently.  They have to be done with the operating rules because of the greater understanding.  But we also know that greater efficiencies can result as a result of the two working in tandem.

The results do not magically happen.  It takes really provider and health plan engagement to basically work together to basically bring about a better understanding of the standard and the performance expectations that make it work.

Now the Phase IV Operating Rules are an important piece.  They do establish the connectivity piece.  For that, we are supportive of that.  But we also know that the connectivity rules are just a starting point and that we need to basically have more done in the understanding and responsibility of users to use the remaining standards the way they were intended.

For instance, in the institutional claim, the standards rely on a great deal of external code lists, for instance, the current codes, which describe a significant event relating to a bill or a value code that represents a monetary amount of some sort.

The important thing here is that looking at the external codes that make up the claim, it is important that the users can basically demonstrate that they up to date with the most recent code list for that standard and know how to apply that code when it is reported within the standard; otherwise, it slows the claims processing system down.

One of the things I would like to see down the road is just a validation of the ability of the users to stay current with the different code lists that make up the particular claims standards.

We know that the claims standard itself can be improved upon in terms of agility, but we also know that to do that really may mean working with more external code lists to make that standard more agile.  I repeat.  The ability to test out the user’s capabilities in working with the cost list is important.

I know that the clinical diagnosis codes – there are variations among some of the Medicaid plans that use the standard in terms of staying current with the particular version of a release of the diagnosis codes.

Working with the same release of that standard code set is important throughout the documentation.  We like the fact that the acknowledgement piece would also be an important piece that could be added as part of this process.

We do think greater efficiencies can be achieved, but it does involve greater engagement and involvement.  With that, I will stop and take questions later.

DR. SUAREZ:  Thank you.  Thanks George.  I think we have Rob next.

MR. TENNANT:  I would like to thank the Subcommittee for inviting me to participate today.  I am Rob Tennant, director of HIT Policy for the Medical Group Management Association.  We have now about 33,000 national and state members, everything from very small, three or four physicians, single specialty groups all the way up to the largest multi-thousand, multi-specialty groups in the nation.

I wanted to start with the slide from the CAQH index to suggest that the claim is almost there.  We are at 92 percent or so, maybe even more, adoption rates.  This is one where I think there is a lot of consistency among the testifiers.  We do not want to mess too much with something that is relatively working well.  We do not want to add more problems or potential issues to slow down the adoption rate.  There are a few folks that are missing, probably the very small providers.  It would be great to get them on board and you all can see here that more than $2 per claim is going to be saved.

In general, we are very supportive of the work that CORE has done.  We are supportive of the payload, the message envelope, communication channel security, transport layer, and network.  But I did want to zero in on a few issues and concerns.  Real-time claims are very important.  We have seen wonderful use of the real-time eligibility transaction in the real world of health care.  Because what we want to see now is more information flowing when the provider needs it.

The trend, good or bad, in health care is more and more patients are walking into practices with high deductible health plans.  That puts a lot of financial pressure both on the patient, but on the practice as well.  They want to identify the eligibility early on, preferably the day before, and find out what the patient financial responsibility is.

The challenge is if there is a change in the service provided during the visit that will not be reflected in the eligibility and there is a potential down side in terms of identifying the patient financial responsibility.  I think real-time claims have the ability to fill that void and very quickly identify what the patient owes while the patient is still there.

Ultimately, we want to get to real-time claims adjudication.  I do not think we are there.  We are most estimation.  If there was real-time claim adjudication, we could very quickly move to real-time claim payment.  As the patient left the practice, the payment would arrive in the provider’s bank account.  We are not quite there yet, but there is always hope.

In terms of batch, we would like to see quite frankly dovetailing with the eligibility where you get the information back the next business day.  We think that is feasible or reasonable.  Right now, it is at two days.  Certainly helpful.  But it would be even better to get it a little bit faster.

Not surprising, we are very strong proponents of acknowledgements.  In our own lives when we deal with Amazon or folks like that, we always get a receipt.  You always know what has happened immediately.  You get acknowledgement when you make a transaction.  There is no deference in health care.  I think it has been widely accepted by health plans, widely implemented by clearinghouses, but not as wide as it should be.

I think the main reason that my members tell me they need acknowledgements is because they want to know where the problem is.  There is a problem with the claim.  They do not get the claim paid.  Everybody points a finger at somebody else.  It is the vendor’s fault.  It is the clearinghouse fault.  It is the health plan fault.  With the acknowledgement, you will know exactly where the problem lies.

The only challenge is there is the potential because as we know, there are many potential hops in the transportation of the claim.  We do not want the provider to be saddled with additional per click charges should everybody be sending acknowledgements and their vendor is charged for each time that happens.  We hope that will be a give and take with their vendor and hopefully drive down costs there.

There is an issue that has not been addressed yet, but it is a persistent and a really critical one for my members.  Very often when you do an eligibility, you get the green light from the health plan, you submit the claim, the claim is paid, and then downstream the plan comes back and says I am sorry.  We found out after the fact that the employer never updated the rules and therefore you are on the hook, provider, for paying back our money.  We would argue that that is a fine opportunity through operating rules or some other mechanism to force the employer to pay the cost of that claim.  There is really no reason why the provider who went through the trouble of getting an eligibility, treated the patient.  Why should they be on the hook for the payment when the fault was on the side of the employer?

The other issue we have authentication.  Although we understand the intrinsic value of digital certification, we would argue that the industry is probably not ready for this type of sophisticated authentication.  Maybe it is an option.  But I think at this point, we do not want to discourage especially those smaller providers from adopting these operating rules.  And frankly, this environment is changing.  We do not know what the security environment is going to look like over the next few years.  There could be new standards.  We would like this to be a little bit more flexible.

Very quickly.  On CPT guidance, it was never included with the requirement for CPT in HIPAA.  We think it is a good opportunity for the operating rules to establish the guidelines rather than allow individual covered entities to decide guidelines on their own.

And the last few recommendations.  Obviously, we need to really increase education to providers on admin simp.  If you look at the amount of energy, money, time spent by CMS to convince providers to move to ICD-10 that same energy should be put into something that has real tangible financial benefits for practices.

We also strongly endorse and support the EHNAC/WEDI Practice Management System Accreditation Program.  We are very pleased to see an increased level of collaboration between the standards groups.  We hope that that will continue.

I know I will get support from the payer community when I say we need to be looking to move to proactive payer audits in terms of compliance.  Because if we cannot get folks to do this then there is no reason to move forward.

With that, I will stop and look forward to questions later.

DR. SUAREZ:  Thanks.  I think we have Melissa on the phone.  Melissa, if you could introduce yourself and then provide us with your testimony.

MS. MOOREHEAD:  Thank you.  My name is Melissa Moorehead.  I have co-chaired the National Medicaid EDI Healthcare otherwise known as NMEH, a workgroup on operating standards since 2012.  This group was formed specifically to educate Medicaid stakeholders on the impact of Section 1104 of the Affordable Care Act we have on mechanized claims processing system for Medicaid management information system.

NMEH also encourages states to work together along with CMS and other regulatory entities to ensure that transactions, standards, code sets, and operating rules include a Medicaid viewpoint and promote administrative simplification and are cost effective in an efficient manner.

While every state feels the urgent need for administrative simplification and cost savings, they are subject to multiple, complex regulations at several levels.  State Medicaid agencies are considered a health plan under the law, but they are not businesses in the same way that insurers are.  They also have a special status as payer of last resort subject to laws requiring special communication sets relationships with providers and other payers.

While Medicare and Medicaid are very different programs, CMS’ payment reform initiative to move payments for health care away from fee for service or value-based payments has prompted or further enhances state’s efforts to do the same.  And – 2013, the vast majority of Medicaid agencies across the nation had already enrolled more than half of their beneficiaries in managed care programs.

The transaction standards and operating rules or claims are primarily written for fee for service implementation and they envision that claims processing is a unified business process from start to finish.

Regulations requiring the implementation can take focus and investments away from a larger payment reform goal towards enhancements to accommodate the fee for service claim.

On the other hand, standardizing elements of claims processing across all payers have clear benefits for Medicaid providers and Medicaid as a payer when coordinating benefits and payments.  A solution might be for HHS to consider a transaction volume cutoff or mandate.  Payers who are successfully moving out of the fee-for-service arena would not be required to create or redesign systems to accommodate a transaction that will have diminishing usefulness.

Thus the balance between enforcing standards and operating rules that enhance simplification and simply requiring new requirements that do not fill a business need for Medicaid or can even create further confusion is not clear.  Part of the issue is the length of the regulatory process, which combined with the length of the funding process for Medicaid IT systems as well as political considerations generally leaves no time for zero testing.

In addition, the variation of state Medicaid programs has made establishing a baseline and assessing evaluations prohibited.  Thanks in part to all these constraints, state Medicaid agencies are generally very conservative and reactive on the issue of mandated – and operating rules.  Knowing that mandates are coming can even have a chilling effect on innovation or progress in some areas – development life cycle to make it costly to change direction to incorporate new standards or operating rules that were not foreseen in the design phase.

On open monthly calls NMEH operating standards sub-workgroup has been reviewing progress Phase IV operating rules.  CAQH-CORE has provided much education and answered questions on the call to encouraging states to participate in the rule-making process.  However, in the absence of a mandate and implementation deadline, most states have been participating in listening mode, unable to devote much time to the development process.

The looming threat of massive penalties for noncompliance of Section 1104 mandate has also stifled conversations on the open call and may be more broadly felt as the barrier to working towards compliant and more uniform implementation.

It is very welcome that the Phase IV rules do not address data content.  Operating rules that specify data content have been the most problematic and costly for states to interpret and implement.

The conservative approach to building on the Phase I to III operating rules is also appreciated although there is evidence that some states are lagging in those implementations particularly where modernization efforts and re-bids are occurring.

It is also worth noting that many states have eligibility systems that are not integrated with claims processing and the claims processing system are not necessarily in the same department as the payment system.  This can require much more work to bring infrastructure into the same place in these different fragmented IT infrastructure.

Some states have accommodated infrastructure changes by creating a “CORE connectivity” channel for transactions already covered by operating rules, but it remains to be seen whether this approach will really provide a bridge for accommodating the entire claims processing in the CORE connectivity specification.

The timeline specified in Section 1104 for the last set of operating rules has passed.  It is our hope that this does not prompt HHS to act hastily when it comes to adopting these operating rules and setting an implementation deadline.  State Medicaid Agencies will need time to understand any needed changes and to design a compliance strategy in the context of ongoing systems design and use.

Thank you again for this opportunity.  I will stand by for questions.

DR. SUAREZ:  Thank you so much, Melissa.  We are now going to Stacey.

MS. BARBER:  Good morning.  I think it is still morning for another couple of minutes.  Thank you for the opportunity to allow ASC X12 to provide testimony on the Phase IV Operating Rules.  ASC X12 was chartered by the American National Standards Institute more than 30 years ago and develops and maintains EDI standards and XML schemas, which drive business processes globally.

ASC X12 memberships include technologists and business experts, encompassing health care, insurance, transportation, finance, government, supply chain and other industries.

I am Stacey Barber, chair of the Insurance Subcommittee, which is responsible for the development of the HIPAA Implementation Guides and TR3s.

Our position has not changed from when we provided testimony on the draft rules in February of 2015.  ASC X12 feels that the business needs of the health care industry are met within the transaction content of the ASC X12 transaction technical reports.

We agree with the position CORE took at the time of not including any data content requirement in the Phase IV rules.  The Phase IV Operating Rules are focused primarily on infrastructure and include requirements for the use of acknowledgments.  ASC X12 supports the adoption of acknowledgements through the regulatory process rather than by reference within an operating rule.  We encourage the use of acknowledgements and recommend ASC X12 acknowledgement reference model as the guidance for adoption.

Furthermore, the Phase IV connectivity rules limit submitter authentication requirements to single method that was optional under previously adopted rules.  This puts an undue burden on covered entities that are required to support the connectivity requirements while providers may choose to continue with other methods.

We believe that any authentication supported in previously adopted rules for other transactions should automatically be supported in any operating rule that may be adopted for other covered transactions in the future.

Due to the fact that the Phase IV rules are infrastructure in nature, require use of acknowledgements that have not been formally adopted as transactions and do not provide flexibility for user authentication, ASC X12 would not recommend any of the Phase IV rules for adoption.  Thank you.

DR. SUAREZ:  Thank you.  Sherry?

MS. WILSON:  Good morning, members of the Subcommittee.  I am Sherry Wilson, president of the Cooperative Exchange, representing the National Clearinghouse Association and Executive Vice President and Chief Compliance Officer of Jopari Solutions.  I would like to thank you this morning for the opportunity to present testimony today on behalf of the Cooperative Exchange membership.

Brief background about the Cooperative Exchange for the National Clearinghouse Association.  We consist of 25 clearinghouse member companies, representing over 90 percent of the clearinghouse industry.  We are currently processing over 4 billion plus claims annually, doing this for over 20 years, representing $1.1 trillion for over 750,000 provider organizations through more than 7000 payer connections and 1000 HIT vendors.

In terms of the operating rules, the Cooperative Exchange again has 20 years of extensive industry experience of the exchange of these administrative transactions.  Our testimony has not changed from our prior testimony given on the operating rules.  However, we know that adopting operating rules, we feel the following recommendations we would like to provide to you to bring forward to health and human services that will not impede the existing business processes.  One, to adopt the Companion Guide Rules.  Two, to adopt the Infrastructure Rules with the exception of the Connectivity Rules we do not support.  Also, to adopt the Acknowledgement Rules.

We would also like to ask the committee to review the applicability of defining another set of industry privacy, security and confidentiality specifications when they already exist in other regulations.

We also would like the committee to recommend to HHS they consider sanctioning other industry entities that have established guidelines for certification that meet the HIPAA, privacy, security and connectivity requirements.

In terms of the connectivity rule, we do not support this rule for several reasons.  We find that Phase IV is a different communication standard than defined within Phase I, II, and III.  And having different communication standards, we feel could add confusion to the industry.

In addition, we feel that these rules do not accommodate for existing and emerging technology.  Specifically, Phase IV Connectivity Rule 470 only allows stakeholders one option for authentication with the X509 digital certification.  If adopted, it is going to require stakeholders to build this option and make it available.  The Cooperative Exchange finds limiting authentication to one solution does not provide flexibility to meet different stakeholder business needs and may result in additional change costs that will impede EDI adoption.

In terms of privacy, security and confidentiality, we would like to ask the committee to review the applicability of defining another set of industry, privacy, security, and confidentiality specifications in the operating rule when they already exist in regulatory guidelines.

We are strong advocates for when industry security governs such as NIST to identify best practices and security guidelines have industry compliance benchmarks.  However, today, we, as clearinghouses, are supporting costly, multiple certifications that are redundant, require by health plans, which is increasing administrative cost to this industry.

We are asking for your assistance to recommend to HHS to consider sanctioning other industry entities that have established guidelines for certification that meet the HIPAA privacy security requirements.  We believe the clearinghouse is certified against the national standard security and privacy framework by sanction entity.  Payers should be able to accept that certification and not be requiring costly redundant certification by other entities.

In addition, there has been recent legislation, the Cyber Information Security Act, that requires the development of voluntary industry HIT Security Framework.  We believe that security requirements should not be adopted now but we wait until we see the framework when it is completed.

Very quickly on lessons learned.  The clearinghouse experience has shown standardization of the companion guides.  It has been well received by the industry.  The use of acknowledgements has demonstrated improved processes and is aligned with the industry in a production environment.  Clearinghouse has been using acknowledgements since 2003.  However, there has been limited adoption of the prior operating rules.  Payers and clearinghouses implemented the requirements, but many providers have not.  Adoption in point of previous connectivity rules were built by payers and clearinghouse at a great cost.  A few of our training partners have used these methods.

Lessons learned prior to adopting new operating rules.  You need to have a better picture of the cost, the benefit and actual ROI of existing operating rules.

In conclusion, part of the adoption of future operating rules, we strongly recommend an evaluation criteria be established to determine if there is a business need and that the evaluation include a demonstrated ROI across all stakeholders.

Also, the infrastructure of the claims has been in production for over 20 years and we feel should not be interrupted.  We have proven success with over four plus billion transactions a year in production with few isolated connectivity issues that have been quickly resolved.

Our recommendations address the need for administrative consistency, mitigation of regulatory redundancy, and to reduce the resource burden to comply with regulations.  We do not think that was the intent of the regulations.

Lastly, we stress the importance of continued stakeholder inclusion in the development of necessary additional standards and rules.

With that, we would like to thank you for the opportunity to testify this morning.

DR. SUAREZ:  Thank you very much.  I think we are going to Jean Narcisi.

MS. NARCISI:  Thank you.  I am Jean Narcisi, chair of the WEDI Board of Directors and director of Dental Informatics for the American Dental Association.  I would like to thank you for the opportunity to present testimony today on behalf of WEDI, concerning the proposed new rules for CORE and their impact on HIPAA.

WEDI represents a broad industry perspective of providers, clearinghouses, health plans, vendors and other organizations in the public and private sectors that partner together to collaborate on industry issues.  WEDI is named as an advisor to the Secretary of Health and Human Services under HIPAA and we take an objective approach to resolving issues.

There continues to be a need for greater adoption of the HIPAA transactions.  WEDI feels that operating rules as a supplement to the ASC X12 transactions are an important tool that can help aid the industry in moving forward with Health IT and we appreciate the efforts that CAQH CORE has made in the development of these operating rules.

WEDI has previously provided testimony in operating rules in 2010, 2011, and 2015.  Many of the operating rules implemented to date have provided benefit to industry stakeholders.  Our testimony today will cover concerns with the current proposed operating rules for claims.  The ultimate goals of administrative simplification are to improve the accuracy, efficiency, and cost savings from all transactions.  The Phase IV Operating Rules are intended to clarify and enhance how transactions should be used in practice by defining connectivity, authentication, identification, standard acknowledgements, and system availability.

However, WEDI continues to have concerns at the published Phase IV rules and pose more restricted connectivity requirements to an industry already burdened by competing health IT implementation.  The Phase IV Operating Rules focus on infrastructure and connectivity, which does play a role in achieving these goals.

WEDI has the following observations related to the adoption of the Phase IV Operating Rules.  First, connectivity provisions in consistency of requirements across phases.  It is critical for infrastructure and connectivity provisions of operating rules to be consistently applied across all adopted transactions.  When the different phases have different requirements, it limits the ability to gain efficiencies through the use of common connectivity and other associated service requirements.

Under Phases I, II, and III, the health care industry has employed a variety of connectivity methods for electronic administration transactions, using different envelope transport, security, and authentication standards.  If requirements vary significantly by transaction, additional effort and cost will be expended to support these differences.

WEDI acknowledges the need for unifying these approaches, but also recognizes the importance in value of allowing stakeholders some flexibility according to their needs and technical sophistication.

Under Phase II connectivity rule 270, submitters were given the option of using either an X.509 digital certification or username and password as authentication methods.  Many stakeholders opted to implement the username and password approach as it was already supported on their systems and therefore did not require additional investments.

The Phase IV connectivity rule 470 now requires HIPAA-covered entities to support a single submitter method, which is the X.509 digital certificate for claims, authorization, premium payment and enrollment transactions.  This requirement would force these entities to support the X.509 digital certificate even though their trading partners would not be required to use this authentication method.

There is a concern that HIPAA-covered entities would be required to incur the cost of having the X.509 digital certificate available and few or none of the trading partners would convert to use it.  This creates a disconnect between the authentication options across transactions and across CORE phases.

There is also concern that some HIPAA-covered entities would force their trading partners into utilizing the X.509 digital certificate regardless of whether or not they are in some cases a HIPAA-covered entity.  For example, the employers in the situations of the enrollment and premium payment.  This might discourage some of the senders from utilizing electronic transactions due to the cost involved with purchasing certificates.

WEDI supports continuing to focus on privacy, security, and confidentiality safeguards and sees the need to conduct further research on industry experience and cost benefit analysis in order to ensure there is a balance in the adoption of new requirements.

Rather than imposing new requirements, WEDI suggests applying Phase II connectivity rule for the remaining four transactions thereby maintaining consistency across all HIPAA transactions.  Further security safeguards could be accomplished by CORE providing requirements for enhancing the complexity of password security, using both alpha and numeric characters without forcing stakeholders to adopt new technology or HIPAA-covered entities to incur additional costs with no benefit if none of their trading partners convert to X.509 certificates.

In a future version of operating rules, a movement to digital certificates could be proposed for all transactions and all stakeholders.  WEDI is concerned that the industry will have difficult absorbing more restrictive requirements at a time when it is already overburdened by mandates.

Given that not all stakeholders have implemented prior phases of operating rules, it is difficult to project the actual benefits that more restrictive rules would have.  With the current number of compliance mandates such as meaningful use and new payment methodologies, it might be more beneficial to reinforce the value of implementing existing operating rules and requirements across all parties than to introduce more restrictive requirements at this time.

As has been expressed in prior testimony, confusion could arise over the inclusion of wording related to CORE certification.  Acquiring CORE certification is a private voluntary decision.  It would be helpful if references to CORE certification were documented elsewhere not included in the text of the rules adopted under federal regulation.

In conclusion, WEDI understands the need and desire to move the industry forward with the adoption of operating rules for claims.  We urge HHS to work with WEDI to monitor challenges and surveying industry readiness.  It is recommended that a system be developed to capture testing and implementation issues in order to provide the industry with a common database of issues that can be consulted.

In addition, WEDI encourages HHS to work with WEDI to educate stakeholders and raise awareness on the appropriate use and application of different standards, transactions, and code sets.  WEDI and HHS have a long history of working together in offering joint educational programs to help educate stakeholders and regulatory changes.  WEDI recommends that HHS work collaboratively with WEDI and develop educational briefings and webinars to help key stakeholders learn about the operating rules, transactions, and standards.  Thank you for the opportunity to testify on behalf of WEDI.

DR. SUAREZ:  Thank you.  And then we have Debra Strickland.  Are you on the phone?

MS. STRICKLAND:  I am here.  Members of the Subcommittee, I am Debra Strickland.  I am Client Service Consultant at Xerox Health Services.  I would like to thank you for the opportunity to present testimony today on behalf of employer groups, concerning the matter of Phase IV Operating Rules for the claim.

Xerox is an employer group and has also many other roles in the industry.  Medicaid MMIS vendor, commercial clearinghouse.  We have data capture centers, call centers, support centers, and last but not least the document management company.

At this time, we feel that the Phase IV rules for claims are going to come at a great cost considering that the electronic claims have been widely used across the health care industry for at least two decades, using the industry standards.  And with over 4 billion claims, transactions, processing across the industry each year, we have an established working claim infrastructure.

It is our opinion that the majority of the benefit from the electronic claim has already been realized.

To the question, does the operating rule meet the industry’s business need, use, or problem resolution, we believe that the proposed Phase IV claim operating rule does not provide additional value to the industry and that is because there is not a presenting issue.  We are processing claims, as I said, over 4 billion claims in a year.  That is a lot of claim transactions, probably more than that at this point.

Of course, the burden of the cost of rules.  We have to really consider that.  It is on the payers usually and we need to make sure that we are having a very good reason to adopt and make the industry spend money to implement these rules.

As far as business need, we need to make sure we are aligning with what the law defines as the operating rules being necessary business rules.  If the industry is processing over 4 billion claims, are they really necessary and we really need to make sure that we have an established return of investments for these rules.

Payers, clearinghouses, and providers have evolved their own claim infrastructure solutions across the industry voluntarily without any major issues.

The industry has adopted and established connections.  They do not need necessarily the companion guide rules because they already have the necessary methods to communicate with their partners.

It is very important and others have mentioned that we need to make sure that we control the administrative costs.  Implementing a new communication protocol is the .509 digital certificate is going to be a burden on the industry.  There are many different ways to secure the data and .509 would be a high cost method to do that.

And also naming a specific certificate in an operating rule will lock the industry into this and not really allow fair trade.  The industry also needs to be agile.  It needs to adapt to new secure methods.  Maybe new stuff will come out tomorrow.  We need to be able to be agile and be able to adopt to that.

We also need to again balance the return on investment.  We had other communication methods that were suggested in the last phases.  They were built and a lot of people did not come.  Let’s really make sure that all of the industry has actually gotten a return on investment for the other rules that we have had before we implement new ones.

As far as acknowledgements, they are part of the Phase IV claim operating rule and they were as part of Phase I, II, and III.  In those cases, they were taken out and not adopted.  While we do actually support the acknowledgements and they are happening in the industry today quite broadly, we do support the 999, 277CA, and the 824 transactions and believe that they should added to the HIPAA suite of transactions as well as the ASC X12 Acknowledgement Reference Model, the ARM.

The Acknowledgement Reference Model covers the interaction of attachments for transactions all in one Technical Report Type 2.  It gives instructions for all the transactions and it is an all in one document for the industry.

In conclusion, I think we need to critically evaluate the need for proposed rules covering long-established transactions, concentrate on where there is a problem and fix it.  If there must be rules on a transaction in order to meet the ACA requirement for rules, maybe adopt the companion guide as the easiest thing for the industry and the least costly.

Steer clear of mandating security rules such as the .509 digital certificate and the operating rules as there are other security regulations that do that.  I think that having it in multiple places will be confusing to the industry.

We need to make sure that we are keeping the industry moving in a positive additional way and we need to do things like the attachment rules, which are very positive for the industry.

I thank you for the opportunity to testify today on this topic.

Agenda Item:  Subcommittee Q&A

DR. SUAREZ:  Thank you so much for the testimony.  I think we are a little bit ahead of time, which his great.  We have a few minutes for Q&A from the committee members.  We will start with any questions that might be on the phone.  Any questions from Alix and Ob or other members of the committee that are on the phone?  Do you want to jump in and ask any questions at this time?

MS. GOSS:  Walter, this is Alix.  I am good.  I think the testimonies have been quite clear and I appreciate everyone’s flexibility.

MR. SOONTHORNSIMA:  I do have one quick question.  If somebody could tell us.  When we are talking about the .509 digital certification, explain a little bit around the complexity of applying that and the cost issue.  That way we understand the order of magnitude.

MS. GOSS:  Let me add on to his question.  How the X.509 certification discussion in Phase IV may also tie into what is happening with direct secure messaging and meaningful use.

MS. LOHSE:  Absolutely.  We are happy to share.  The connectivity group started actually about seven months before the other groups that started.  They did a really detailed environmental scan of both what is happening in the clinical arena, what is happening in the federal regulations and also as you know many of the implementers, which again there were over 90 entities including Medicare, National Health Plans, large health systems, the connectivity group was actually chaired by a provider that runs I want to say 191 facilities.  Many of them are inpatient/outpatient.  These are the types of entities that they are dealing day to day with security risk.  And the cost for the security risk, the insurance for the security risk.  They spent quite a lot of time looking at this issue.

What was found with regard to the cost after much analysis and again we are happy to share this is the cost to implement based upon entities that are actually implementers and using this was less expensive for them than to not have it because of some of the security and risk factors.

There was also the point – and this was gone over several times.  I know there is a CAQH CORE staff member here, Bob Bowman, that can give more detail on it.  It is a Safe Harbor.  Other connections can be used.  Just to repeat, other connections can be used because I think there is maybe a misunderstanding about what a Safe Harbor is.  It means you have to offer out this capability, but if you want to use other connections you have.  The group came to a conclusion given where meaningful use is going, given where FIPS is going, given where the clinical initiatives are going, given where the risks are going.  The cost for digital certificates and these again are the implementers, not anyone else, outweighed the risk of not having that for the Safe Harbor.  If the industry was to say you have to offer out one connection, this is where they would go with the security.

They also included a maintenance capability to go back and look at that and update it as needed both for the payload and also for the security as time moves forward.

They also were relying on – assuming we all are participating in the ACA Review Committee, how often do we update these because now we have included maintenance on a daily – we can do it very frequently and quickly as an industry, but then also you as a Review Committee can call for maintenance.

I am happy to share the 90 companies, both public and private, from California, from every single state, providers and health plans and vendors.  Any of them could come and speak to you about why they are using digital certificates.  Many of them are actually working with federal and state programs.  They are needing to update their systems anyway.  I hope that is helpful.

MS. WILSON:  I would like to acknowledge that in the NIST, National Institute of Standards and Technology guidelines, there is a specific guide for multi-layered authentication.  Within that guide, the .509 is definitely one methodology that is recommended; however, there are several.  And what is very important about it is based on the different levels of business application and also to provide flexibility on the different levels of stakeholder EDI readiness.  There are other solutions.  The .509 is one.  We do not feel that one should be specified because then we will have to build that.  That is the same problem that happened with the other connectivity.  We went to a lot of effort and cost to build it and people would benefit to use it, as we have seen from our experience.

The other concern that we have is if you have a .509 certificate, you must have other people using that .509 certificate.  That requires all parties to participate in doing that.  We feel that it is a burden because there are other alternatives available that can achieve the same objective.

DR. SUAREZ:  Thank you.  A quick follow up on this question because I think it is – this seems to be one of the points that have come up with some – to understand better.  The idea, the expectation would be that if I am a health plan and I am trading with many entities out there including through my clearinghouses or direct that any exchange that I do of these four transactions or claims at least and data applies to all the four I guess, me as a health plan doing that transaction will have to establish at least one as an option a digital certificate-based connectivity with each of the providers or each of the trading partners, including my clearinghouses if I have more than one and then others that I connect directly to conduct these transactions.  Is that the intent basically?

MS. LOHSE:  I want to put that in other words because I think there is one change.  You have to offer out the capability.  Someone said build it.  You do have to educate staff, which we found with previous phases.  A lot of the entities have not maybe invested like one would expect.  They would be investing in security at this point.  You would have to invest in either hiring staff or contracting out staff that would learn about this evolving security.  You would have to be able to offer it out and should you and your trading partners decide you want to use it, you would have to be able to connect with them using that.

I think that you have heard – I remember Harvard Pilgrim testified here at the Review Committee.  Their cost reduction for being able to communicate with their clearinghouses had reduced by over five months.  They were able to build up a clearinghouse connection more quickly because they had this one standardized methodology to work with their clearinghouses.

We also heard from many of the providers with regard to the digital certificates that they are trying to build up their knowledge base about security and it is one reason why given where the federal requirements are for things like FIPS, meaningful use, clinical data exchange that digital certificates was something they have to invest in to move forward to make sure that they have the security layers.  That username and password just is no longer good enough.  And also that a maintenance required for this safe harbor again just to offer it ongoing maintenance so the industry is not waiting for a mandate.  They have to meet.  They have to talk about it.  If they need to update it that the industry is driving some of those conversations and coming to you and saying we need a change versus waiting for that change.  That was some of the dialogue.

DR. SUAREZ:  I just want to ask Alix if you have any comments about – because I am not exactly sure – Alix, if you know about the meaningful use requirements or expectations with respect to X.509.

MS. GOSS:  Thank you, Walter.  When you look at the direct secure messaging protocols whether you do it via a web browser or email client or integration with your EHR directly, there is an expectation that you are using X.509 certificates as the decoder – ensuring that you are encrypting and decrypting the messages.  I was thinking that we would have from a high-tech sort of world when you look at EHR data that there was a lot more progress towards X.509 certificate and spoke to the things that we are doing under NIST and meaningful use and moving data around.  I was looking for some commentary.  Maybe commentary is the wrong word.  Maybe looking for further clarity on why this was still a big list when it looked like clinical world was moving forward to this whereas the – replacing that need in the EHR exchanges.

DR. SUAREZ:  Thanks.  Thanks for that clarification.

MR. TENNANT:  Just a real quick point.  I caution against hanging our hat on the current meaningful use requirements.  Andy Slavitt, just a month ago said, Meaningful Use as we know it is dead.  It will be reinvigorated with the MACRA rules.  We do not know what they are going to say.  This is going to be pushed into the next administration, a new set of rules, which I think is why a lot of us are saying we just need the flexibility.  It is probably not wisest to identify one standard.

DR. SUAREZ:  Thanks and good point.  I think one important point about that too is – and we use the word meaningful use to refer to a lot of things – but while meaningful use as a program might be changing, will be changing in the future, ONC, Office of National Coordinator’s responsibility over the certification of health IT.  Notice that I am saying certification health IT and not certification of EHRs because ONC is now expanding its scope, has been expanding its scope from focusing on certifying EHRs to now looking at health IT as a whole and providing certification.  X.509 is one of the certification elements in the health IT expectation.  I am just bringing it up because I think it is important to look into that.

An important point I was asking is about the relationship between payers and clearinghouses and providers because before an example – one of the roles of clearinghouses as defined in the HIPAA rule is that they can take a non-standard transaction and convert it into a standard and then send it as a standard.  What happens about the operating rule requirements between a covered entity like a provider and a payer and the clearinghouse?  Do they have to comply with that in between the provider and the clearinghouse or does this rule apply that standards are not required if you hire a clearinghouse?  I do not know that answer.  I wonder what your perspective is.  All of you probably have that – and I know you probably have some perspective on that.

MS. WILSON:  That is a great question.  I think it very important.  We do have privacy and security regulations.  We have connectivity regulations that we must comply with.  Again, the clearinghouses have 20 years of experience in changing these transactions with over 4 billion a year.  We have not had one HIPAA violation among the clearinghouses over those 20 years on the connectivity.  The connectivity standards.  We have to adhere by the OCR audit protocols as well.  In our transaction compliant data at rest or in motion is encrypted.  Again, there are many other methodologies that are allowed for multi-authentication that are used today very successfully and meet the privacy and security and connectivity requirements.

MS. LOHSE:  I just will echo based upon a year and a half of discussion and critical criteria that 90 plus entities felt to be able to offer one safe harbor that has greater security is an important movement for the industry to consider that its PHI is in this information and we are all going to need to prioritize security more and align the clinical and the administrative.

DR. SUAREZ:  Any other comments from the panel on this point?  On the phone, any other questions?

MS. BURCKHARDT:  I have a comment.  This is Laurie Burckhardt with WPS Heath Solutions.  I was actually the WEDI representation during the Phase IV Operating Rules development.  I think it is important that we not mix our apples and oranges.  I think that the Phase IV Rules are definitely the way to go.  But as Jean has stated in her testimony, we are looking at it as it needs to apply to all the transactions and some payers are forcing entities.  It could be detrimental to the industry as a whole.

I think the other thing is that it would be nice if we could all have one way of doing things when it comes to connectivity.  I think from a provider aspect when you are talking about clinical data versus administrative data, the administrative data and the clinical data within a provider environment do not always talk well together.  Their administrative transactions come out of their practice management systems, which is a different connectivity than in the electronic health records.  Those are just things that need to be considered as we move forward.  I think it is a good goal to have in the future is just is the question is the timing now.

DR. SUAREZ:  Thank you for that comment.

MS. GOSS:  This is Alix.  To that point, wouldn’t it be great to give providers a set of tools that are common tools for how you manage authentication security protocols across the different types of systems they have?  Maybe that is an end goal.  And maybe what I am hearing is that we need to be careful how quickly we push towards that goal or that we just should not even try to have admin simp and HITECH, high business functions within a provider institution have an overlap.

MS. BURCKHARDT:  That is exactly the point, Alix.  I love the movie- build them and they will come, but it just does not happen.  I just do not think that it is beneficial to the payers to build something in the hopes that people will come and then forcing the provider community as well.  I just think that again we need to look at it from all aspects and not think that we can do everything at once.

I think the other important thing is that when we talk about the breaches, if we look at the breaches’ history, it never had to do with administration transactions.  People have broken into.  It is still on laptops.  They have broken into mainframe systems.  It had nothing to do with administrative transactions.  I do caution us using that as a platform to move forward.

DR. SUAREZ:  Thank you.  Other questions from any other member of the committee?  Anyone?  Remember, if you want to ask questions here at the table, you can just lift your card.  Anything else on the phone?

DR. SORACE:  When you try to figure it out how rapidly something is being adopted, how long and how certain does it take you to do that?  In other words, are you relying entirely say on surveys?  Can you look at rates of adoption, different types of messages and operating rules electronically and track them over time?  Can you give some ideas to what those processes look like and how long does it take us to reach some sort of certitude about that?

MS. LOHSE:  I would add three years at least.  I will just give you a round about why.  We use three different methodologies that I can immediately summarize.  One is the voluntary certification.  We have seen time and time again now – almost no entity now is coming for voluntary certification.  Again, it is Medicaids, 15 Medicaids, including California Medicaids are more complicated at the county level.  National health plans, regional health plans, practice management systems, non-HIPAA-covered entities, and clearinghouses and large providers.  No one is coming to the table by themselves barely to get certified.  They rely on other people.

And what happens is typically the entity that is ready to get certified, their trading partner that they are relying on for a piece of it is not ready.  It takes that time to coordinate.  The project plan, putting the pieces together, building out and then tracking the adoption.  With the certification, we use that as a mechanism.  We know how much covered lives are with each of the CORE-certified entities for each of the phases and then also for the vendors and the practice management systems.

Additionally, we do use surveys.  We have over 10,000 entities or individuals, representing a wide range of entities attending public calls.  We do surveys on those.  We see it takes about a two and a half-year process to start tracking the adoption.  People will be honest because we do not share any names and we ask the same question over and over again on these calls about their tracking and adoption.

Additionally, we have a person – solely an office at CAQH that is focused on measurement and tracking.  That is the name of the office, measurement and tracking.  They do the CAQH index.  And the report is about to come out in the next month.  They gather data from – it is 4.2 billion transactions, a number of claims.  It is both for nonprofit, for profit.  It is from providers.  We work with the University of Chicago NORC, their research center as well as Milliman.  And took this data and we track it each other.  We have owned now for three years.  We can see from that it takes times.  This year’s report is last year’s data.  I would say about three years.  That is with taking all that information and using all of it to track across.  Does that help?  Hopefully, that was clear.

DR. SORACE:  That was very informative.  A lot of it is just basically uptake in terms of just finding out whether the end from last year is bigger than the year before.  You have a one-year turnaround time.

MS. LOHSE:  You will see in the index that is going to come out in about a month, we did a comparison between the first three years of data now that we can compare.  We are comparing the third year with the first year and seeing how many transactions or adoption level as well as the cost of change over a three-year period and also the individual year.  For instance, claim status.  I have no idea why I remember this.  Within the last year, you have seen a 6.3 percent increase.  But in the previous year, it was smaller.  And the previous year was one of the first years the requirement was out.  Again, tracking over that three-year period is allowing you to see where the market is going.

I will add.  When that report comes out, we would be happy to have the person who is responsible for it that he comes from AHRQ background to present the report.

DR. SUAREZ:  Thank you so much for this panel.  It has been very informative.  Great way to start our hearing and certainly this is one of the most significant if not the most significant transactions.  I really appreciate it.

We are going to move quickly into the next panel, which is focusing on enrollment and disenrollment.  We are going to start with Gwen just giving a brief overview of the enrollment/disenrollment operating rules and then we will go to our testifiers.

Agenda Item:  Panel 2:  Enrollment/Disenrollment and Premium Payment

Agenda Item:  Overview of Proposed Operating Rules – Enrollment/Disenrollment and Premium Payment

MS. LOHSE:  I am going to keep this short and highlight some things.  For the enrollment and disenrollment, batch is required and real time is optional.  Again, we did highlight in our earlier testimony that the industry itself, the implementers, again, 90 percent participation with over 100 entities and 88 percent approval, felt that having some type of expectation by the industry as we have tried to move to real time, think about the providers.  They are seeing a mix of Medicaid patients, HIX patients and then traditional employer patients.  Try to move and set expectations about how quickly do you need that data as people change their coverage.

And then acknowledgements.  The acknowledgements were considered essential.  And then some of the other pieces and especially again PHI, at least offering a methodology that is secure with regard to the earlier conversation we had on the digital certificates.

There are two points here that are a bit different and I am going to pop down to this chart.  Hopefully, some of you can see this.  I do not know if you can.  With regard to these two transactions, the group felt that because of the need for the provider to update their systems on who is eligible that a timeframe needed to be set for the health plan about how quickly they update their systems once an enrollment comes in or a disenrollment or when a premium payment comes in.  Because if a health plan is not updating their systems and I think Rob did a great job of summarizing this then the provider uses their practice management system.  It may ping the health plan.  It may go through a clearinghouse or two clearinghouses.  It may come back.  It may be incorrect information about the patient being covered.  There is a requirement within five business days following the successful receipt in validation of the data that the health plan has to update its systems.  That is one variance.

Also, this group to note.  We did study.  We actually retained an external consulting firm, Accenture, because they work with the federal health insurance exchange and manage some of the state-based exchanges.  Retain them to do a study.  They presented to the subgroups about how the HIX companion guide was using acknowledgements and whether that was useful and how it was also using these transactions.  That helped inform the belief from the 90 plus entities that are implementers that these basic national operating rules for infrastructure should be followed because you are already seeing them with the health insurance exchanges.  We surveyed a number of the health plans that the same systems are being used for the insurance exchanges as for the regular so having some consistency across.

DR. SUAREZ:  Thank you.

MS. LOHSE:  We are happy to share that study if you would like to see it.

DR. SUAREZ:  Please, we would love to.  I think we are going to start with Pat.

Agenda Item:  Industry Perspectives on Operating Rules:  Enrollment/Disenrollment and Premium Payment

MR. WALLER:  My name is Pat Waller with Cambia Health Solutions.  Cambia Heath Solutions is a health care solutions company, headquartered in Portland, Oregon with six health plans that serve members throughout Oregon, Washington, Idaho, and Utah.  Our focus is to transform health care by exploring innovative, person-centered and economically sustainable models of care.

Today I am testifying on behalf of America’s health insurance plans, whose members provide health and supplemental benefits to 200 million Americans through employer-sponsored coverage and individual insurance market and public programs such as Medicare and Medicaid.

My testimony will address the use of the enrollment/disenrollment and the premium payment transactions and recommendations for their future use.  In general, we recommend NCVHS review the two transactions separately as the value proposition for adopting new operating rules for each transaction may not be the same.

The value of transactions is limited by their use by the stakeholders.  While health plans are mandated to support both transactions, other HIPAA covered and no-covered entities are not.  Namely, employer groups are not covered entities and thus not required to use the transactions.  As AHIP reported in its June 2015 ACA Review Committee testimony, the only way to ensure stakeholders who are not covered entities to comply with HPAA transaction standards is to require it contractually, which can be very difficult to do.  Thus, employer groups have little incentive to adopt standards and often turn to alternative proprietary business solutions.

Adoption rates for the 834 and 820 vary, however, which is why we recommend NCVHS examine the value of the next phase of operating rules separately.  Health plans have found that the adoption of the 834 is higher than the 820, especially for large groups, due to the use of an intermediary to process the 834 transaction.  For example, Cambia uses third party to accept the majority of 834s from its large employer groups and then interface back to our systems.  This has streamlined our processes and has led to increased efficiencies and automation.  Smaller accounts typically do not use the 834 given the costs and complexity on the part of the account.  Cambia’s experience with the 820 is limited to one large employer group and the insurance exchanges.  We have found that systems used by our accounts do not support the 820 and limit the accounts to an alternative electronic or paper format.

While broader mandates for providers, vendors, and employers still need to increase adoptions across stakeholders, we believe there is value in adopting the Phase IV Operating Rules for the 834 at this time.  However, many employer groups do not have the capacity to support the 820 and instead request alternate formats.  They are less complicated than the 820 standard.  Because utilization of the 820 is so low, we are concerned that the resources needed to implement the Phase IV Operating Rules would not be justified by the value added.  Instead, efforts should focus on increasing adoption of the current transaction standard, for example, through increased use of intermediaries to process premium payments via the 820, prior to adoption of the next phase of operating rules.

Finally, we caution against the adoption of new operating rules connected to health insurance exchanges at this time, which use unique companion guides.  AHIP submitted testimony for June 2015 ACA Review Committee hearing in which we strongly recommended against any revisions to marketplace policies, processes, or transactions and their corresponding standards, code sets, and identifiers at this time.  Marketplace stakeholders continue to work toward successful data exchange through incremental enhancements, but major changes to business and data requirements at this time would disrupt efforts.

In closing, we recommend that the Subcommittee evaluate the industry’s readiness to support Phase IV Operating Rules for the 820 and 834 transactions separately.  In its evaluation, the Subcommittee should assess ways to continue to increase adoption of the standards.  We recommend that the Subcommittee support broader requirements across stakeholders to deliver greater efficiency and cost savings to the 834 and 820.  While the 834 may be ready for adoption for the next phase of operating rules, the 820 would benefit from broader industry use prior to the next phase of operating rules in order to fully realize its value.

Thank you for the opportunity to provide feedback to the Subcommittee and I will take questions later.

DR. SUAREZ:  Thank you very much for that.  Gail.

MS. KOCHER:  Gail Kocher, Blue Cross Blue Shield Association.  We have one written testimony that applies to all of the operating rule panels.  We were able to get a few copies and I believe the ladies have made them available to you all.  I made it here, but the shipment of my copies did not.

Just try to focus on two additional pieces related to the premium payment and enrollment transactions from what I spoke about earlier.  I wanted to just provide a little further context around the concerns that the plans identified related to the submitter authentication method.  I know we discussed that a little bit during the Q&A.  But I first want to ensure everyone that privacy and security is of the utmost importance to our plans and how they interact with us at the association and how they interact with all their trading partners.

They do see the potential to improve usage and efficiency, increased productivity, decrease errors, but there is that concern about a negative return on investment if connectivity and infrastructure changes are made that are never utilized.

The ROI is limited when connectivity standards differ across the transactions.  The proposed operating rules do facilitate moving to a more secure method of submitter authentication.  But as we have discussed, not everybody is there yet.  Given the increase evaluation and focus on privacy and security in the industry, there may be additional methods that are identified that can provide even better than what today folks are looking at with the X.509 certificate.

The limitation right now is to some standards and not all, coupled with the Safe Harbor provisions that it does not in the end facilitate moving us all to the same methodology at the same time.  We do see that it will improve the infrastructure, but again it is the concern about the timing as compared to everything else.

The other concern that plans have identified with relationship to the 834 and the 820 is the real-time provisions in the operating rules.  Those standards were not developed with real-time in mind.  There is very little real-time functionality.  In fact, I am not aware of any real-time functionality of either of those transactions.  If they exist, the plans have not identified that to us.  We think any real-time operating rules application should be developed at a time when the standard has been developed to address a real-time connectivity.

I will limit our remarks for this panel to that.  Thank you.

DR. SUAREZ:  Thanks Gail.  Debbie, are you on the phone?

MS. STRICKLAND:  Yes, I am here.  Again, I am Deb Strickland with Xerox Government Health Services.  I would like to just make a really brief statement about premium payments.  This transaction has had a great deal of focus with the HIEs and the exchanges and payers have had to implement various flavors through the enrollment and premium payment of these transactions with the guidance of entities such as CCIOO, the Consumer Information and Insurance Oversight group.

Now that they are up and running, it would seem that they are not having any major issues and things are solidifying.  Requiring additional changes to those transactions at this point would really not be necessary for those who are using it and may actually constitute a barrier to success as other mandates are looming.  That is really my statement on the premium payment.

As far as enrollment and disenrollment, as folks have mentioned, the main user of this transaction is the employer groups of course, which Xerox is one of them.  However, since they are not covered entities, there is no motivation to make these changes.  In some cases, many cases, no capability to actually create these EDI transactions without either a costly purchase or a third party in between.

We feel that the employer groups often feel that what they are doing today is working whether it be a bar napkin or an Excel sheet or whatever they are sending is working.  They have no motivation to change and there are no regulations compelling them to do anything with these transactions.

While adoption of these rules will require the payers to do more work again.  The payers had to implement the transaction itself under HIPAA, but it gets a little use today.  Then adding additional rules to that just adds additional burden and cost.

While the enrollment transaction would have tremendous benefit in the industry if the sender were actually mandated to send it, it would reduce the other types of enrollments that payers receive.  Until someone finds a way to bring the employer groups under the HIPAA umbrella, the transaction is going to sit and have very little uptake.

In prioritizing the operating rules for this transaction, I would say it would have the least benefit to the industry for adoption of Phase IV Operating Rules for enrollment as well as premium payment.

I thank you for your time.

DR. SUAREZ:  Thanks so much, Debra.  Stacey, you are next.

MS. BARBER:  Stacey Barber, ASC X12 chair.  Thank you again for the opportunity to present our views on the operating rules.  Our position is pretty much the same as it was for claims from the acknowledgement and the user authentication method.

We do want to point out, however, for the payroll reduction and other premium group payments as well as the benefit and enrollment maintenance transaction, the 820 and the 834, is that the operating rules did include requirements for real-time use.  Gail mentioned this in her testimony.  These transactions were never designed for use in a real-time environment.  If the industry desires that use then we feel like they need to bring their need forward to ASC X12 so that we can address that in future versions.

During the development of the operating rules, we did comment that these transactions had never been designed for the use in a real-time environment.

Once training partners come forward and identify any need for the real-time use, ASC X12, as I have mentioned, is very open to working with the organizations and determining what changes need to be made to those transactions in order to support in real time.  That time is when we feel that they would fit in scope with an operating rule, but not at this time.

Thank you.

Agenda Item:  Subcommittee Q&A

DR. SUAREZ:  Thanks.  Now we come to questions from the Subcommittee.  Any questions?

MR. COUSSOULE:  Just one question in regards to the timing of some of this.  I am trying to think of who raised the point a little earlier today about the financial risk from an enrollment/disenrollment kind of process.  Use the scenario where a system checked an eligibility.  The eligibility looked fine.  Provided the services, made the payments.  It turned out eligibility was wrong because it had not been timely submitted from whatever the source happened to be.

One of the things that did not really get discussed – we talked about whether the transactions were real time or not, but the other question comes in to where is the liability and the liability for the financial liability in this.  Are there any thoughts on that regardless of whether the transactions are real time or not real time?  The liability change could be an interesting component of this.

MS. KOCHER:  I was just going to say that that is not something that we have discussed with plans to date.  It is certainly something that I think they would be interested in discussing.  Maybe Pat is in a position, I do not know, as a single plan to give comment, but I do not have any perspective from plans collectively at this point.

MR. WALLER:  In terms of the financial liability, we still I think are in a position when the claims incurred is whether the service was payable or not.  There are some timing challenges.

I would say that I have seen several state-based legislative efforts pushed forward.  I believe Oregon was pushing one forward and as was Washington.  I do not think – they have not passed.  But it would be an interesting challenge in the industry to deal with and understand that the providers do get bills that need – they need to pay money back.  It sounds like a great case study.

MS. LOHSE:  We have done three things on this.  One is we did hire IBM.  We are smaller staff.  When I mentioned we are hiring people, we have to outsource to folks since that is not very many of us.  We do obviously – the voting occurs by the participants, but these in-depth studies take a lot of time.  We did hire IBM to study the impact of the eligibility rules, for instance.  They went in and they time stamped entities and looked at the provider –-

A number of the providers found that in order for them to be able to get real-time eligibility were two things.  One is they were able to check more patients for eligibility.  They just could not do it when it was batch or manual.  They did not have the bandwidth.  Real time is allowing them to increase the ability for which they check and how frequently.  That will level out.  It is causing more inquiries on eligibility, which cost more money, but it is allowing less bad debt for the providers.  I think some of the providers like Montefiore reported a 35 percent decrease in a bad debt.

Additionally, they also looked at the – when claims do get denied because the provider is not covered, in CORE Phase III the top industry issue was a common set of claims denials and response and getting on the same road.  Literally, the industry through the CORE process went from looking at 300,000 code combinations because everyone could use them separately down to about 1200.  A lot of those are around is the patient not covered, the timing there.  What we have been trying to do is get at this from how does real time help the provider and also the health plan in determining.

The COB is a big issue about whether the provider is covered.  Hitting the COB because it is only used 49 percent of the time.  It is millions of dollars of cost.

And then additionally getting the CARCs and the RARCs and then trying to hit the time in which the enrollment data and the premium payment, how updated the systems are and additionally using the voluntary CORE certification to address the non-HIPAA-covered entities like the TPAs and the employers because they obviously are not part of the mandate.  That is a bigger problem for all of these transactions, the practice management systems.

Pat’s point is totally accurate.  The voluntary CORE certification covered all the entities because it cannot just be one side that is required to do it.  It has to be everyone in the chain.  None of these are happening with one op like very infrequently.

We have within CORE had a discussion about a guarantee.  The system is definitely not out of place yet where you can create a national operating rule on a guarantee because we have to get the hops down.  We have to make sure everyone is following the national set of rules to really figure out when a guarantee would be appropriately.

Hopefully, that was helpful.

MR. SOONTHORNSIMA:  Walter, I do have a question.  Going back to the adoption, I understand there are two consistent issues.  One is employers are not covered, a non-covered entity.  I get that.

I believe it was Pat who mentioned that 834 adoption is high among larger groups.  That makes sense.  Let’s just assume that – let’s follow 820 rule.  Twenty percent of adoption is among large employers and going through Pat’s point, using third party intermediaries to get the 834s in to the health plan.

If we were to apply the covered entity rule to the employer, how much adoption do you think you would really gain realistically for the smaller groups?  When I say small groups, it could be 100 to 500 or whatever you guys define that small group.  If we were to do that, would that be of benefit for further adoption of 834?

DR. SUAREZ:  I am sorry.  If we were to do what?

MR. SOONTHORNSIMA:  If we were to recommend that the employers need to comply?

DR. SUAREZ:  That would take an act of Congress.

MR. SOONTHORNSIMA:  That is right.  But just to know is there even a chance for 834 to be adopted by the smaller groups.  That is really the question.

MS. LOHSE:  I have a comment just to make.  We have seen some of the — one university in Pennsylvania has a self-insured plan they have launched.  A lot of these plans have 100,000 lives, 250,000 lives that are coming.  Some of them are getting CORE certified.  We are seeing a lot of outsourcing.  It no doubt would have to be with the TPA community as well as the employers because that is a key part of the challenge right now.  I know we have been sending CAQH CORE staff to every TPA conference that is available right now to get them involved in the mix.

I know we have had this conversation about who is required: employers, practice management systems, TPAs, all non-covered entities, but essential to the process.

MR. WALLER:  This is Pat.  I would be surprised if you could convince small groups to make the investment even with the law.  I would think it would be very challenging.

DR. SUAREZ:  One quick question that I have at least.  There has been a mention of the health insurance exchanges and that there is some things already occurring with respect to some of these requirements.  I wanted to get a better sense of what is it that is already in place for that part of the industry, the health insurance exchanges.  Are they expecting or are they currently implementing some of this?  I do not know if you have any comments on insurance exchanges.  I think you mentioned and a couple of other people mentioned health insurance exchanges is certainly one.

MS. LOHSE:  For both the 834 and 820, CMS through the effort to create healthcare.gov did create their own companion guide for these two transactions.  We did a – do a review of what that companion guide looked at versus the standards and also what infrastructure requirements were required.  They were requiring it.  The usage.  We also asked them not only what was required, but then what was actually used and to go out and speak with over 33 health plans as well as state-based exchanges to see what was coming in because some of the states have their own requirements.  You have a federal issue and then a state piece.  They are requiring the acknowledgements.  They are somewhat being used.  They are requiring additional data beyond what is actually mandated, which is partially being used.

Long story short.  We studied quite a lot and have the information.  There are requirements for content, for response time, some of the information here.  The adoption is mixed.  I would say mixed with regard to very mixed.  Again, I would rather share the study because it actually has the numbers in it.

MR. SOONTHORNSIMA:  Gwen, could you clarify whether the state and federal exchanges also are using 834 for group enrollment?

MS. LOHSE:  I know we looked at both and I do not want to comment.  I have to look at the study.  I know Erin Richter is here.  She helped lead that project.  We have to pull out the study before I comment on it.

MS. KOCHER:  I can answer just from respect to what the FFM is using.  The federal exchange is using the HIPAA adopted 834 through their companion guide for both the individual market and the shop, which is the group employer market.  Does that answer your question, Ob?

MR. SOONTHORNSIMA:  Yes, it does.  Thank you.

DR. SUAREZ:  The adopted 834 but with the companion guide and they are using it for both, individual market and the group.  Thank you.

MR. WALLER:  We operate in four different states and in there, there are two state exchanges and then two on the federal and we have three different approaches for 834 and 820.

DR. SUAREZ:  When you say three different approaches, do you mean three different companion guides?

MR. WALLER:  One for the feds, one for Washington and one for Idaho.

DR. SUAREZ:  What you mean one is you mean a companion guide?

MR. WALLER:  There are different companion guides.

DR. SUAREZ:  Each one has its own.

MR. WALLER:  Each one has its own.  Each one has its requirements.

MS. LOHSE:  Because this variation too – I know within the CAQH CORE discussion, they felt it was essential to start saying we need to have a common companion guide put out the flow and the format, think about who is exchanging what to involve some of the non-HIPAA-covered entities, which was where did get to with regard to the operating rules.

DR. SUAREZ:  Seeing no more cards up and I do not know if – any other questions from the phone?  Hearing no more, we are two minutes over our revised schedule.  We are going to take a lunch break.  It is 1:12.  I would suggest we come back at two so we again another ten minutes from lunch.  We have about 48 minutes for lunch.  We will be back at 2 p.m.  Thank you.

(Luncheon recess.)

Afternoon Session

Agenda Item:  Panel 3:  Prior Authorization

Agenda Item:  Overview of Proposed Operating Rules – Prior Authorization

DR. SUAREZ:  We are going to get started again.  Thanks to everyone for the morning session.  They were very informative.  During lunch, we were discussing with a couple of the people a few of the themes and messages.  I think it has been very informative.

We are now going to move to our last two transactions.  We covered this morning claims and enrollments and premium payment.  We are going to go to the prior authorization, the last transaction set for which operating rules have been developed.  We are going to use the same approach.  We are going to have a few minutes with Gwen to tell us about this particular transaction and then go to the industry perspectives.

MS. LOHSE:  I will keep it quick because I know we have a short time.  With regard to the prior authorization, I think we are all aware that the adoption level is slow for this transaction.  There is significant room for improvement.  It is extremely costly for the providers to doing the manual prior authorization.  If you look at the CAQH index, we are talking about $13 per prior auth.  It is very expensive.  It is also expensive for the health plans.  Across the board, getting more adoption of the standard would bring significant value to the health plans as well as the providers.

And then I think we all are aware too.  One of the challenges with the prior authorization is the content.  And a lot of the content is actually related to the attachments, which is the next panel.  Whether it is a pre-op report or whatever it may be, you need to send a piece of paper and additional information along with the prior authorization.  Low adoption numbers and content that is attached to the attachment standard that is yet to be issued.

With that all said, there is also a real need to have better understanding of the trading partners of how fast the prior authorizations go through one another, what the requirements are by each of the health plans, and then also just an acknowledgement that the prior authorization was received and if there was an error with it, if they have to send something back or if it was accepted.

After debate within the CORE participants on all of those issues, it was decided to apply the current connectivity infrastructure rules and the real time, the batch, the acknowledgements, the Safe Harbor connectivity again, other methods can be offered.  You have to offer this.  You can use other methods.  System availability and companion guide.

The processing times are a bit different here.  It is batch or real-time required.  The way that the implementers saw this was that an entity could do real time fantastic.  The faster to get to prior authorization and get it done to move in that direction.  If you could do real time, you did not have to offer batch.  Or you had to offer batch and you do not have to do real time.

We have heard from quite a lot of entities that even these basic infrastructure requirements on the prior authorization are going to be a big lift.  There are a lot of companies that actually have employees at the health plans at the TPAs at the provider’s office that are doing all the manual transactions.  They have come to ask CAQH CORE questions about these operating rules with the expectation.  If they are passed, there is going to need to be some changes in the system now with or without content.  When we talk about time is of the essence, if we walk away from even having some of these basic infrastructure things, it means we are delaying people updating their systems and figuring this out more.  And then when we add content, the process will be yet even harder.  We are creating a bigger step for ourselves.  This is the step to get us in the right direction.  It is not the full journey.  We do need to add on content.  The CAQH Board was very clear about that and the content needs to be aligned up with the attachment standards, which is not yet issued.  That is the overview.  Thank you.

DR. SUAREZ:  Thanks so much, Gwen.  Thanks for those clarification points about the difference between this transaction and the other ones – operating rules.

We are going to go to the industry testimony.  We will start with WEDI with Jean Narcisi.

Agenda Item:  Industry Perspectives on Operating Rules:  Prior Authorization

MS. NARCISI:  Thank you.  I am Jean Narcisi.  I am chair of the WEDI Board of Directors and director of Dental Informatics for the American Dental Association.  As I mentioned this morning, WEDI represents a broad industry perspective of providers, clearinghouses, health plans, vendors and other organizations in the public and private sectors.  Also, WEDI is named as an advisor to the Secretary of HHS.

As stated in previous testimony regarding prior authorization, WEDI will work with the industry stakeholders to identify opportunities in associated workflows and address challenges.  WEDI conducted a national survey of health plans and clearinghouses that was shared with the Subcommittee.  Based on findings from that survey and from the multi-stakeholder input received from our Board of Directors Executive Committee, WEDI makes the following observations and recommendations.  Feedback from health plans and clearinghouses suggested that the 278 service authorization referral transactions are significantly challenging and have not contributed enough value or achieved the intended benefits.  In the absence of widespread adoption and use, the return on investment for prior authorization will remain low.

The 278 transactions are difficult and frustrating for stakeholders to use and oftentimes providers find responses confusing to interpret.  Stakeholders suggest defining minimum data content and potentially adding data elements and/or additional transactions to support business requirements including, but not limited to attachments.  The proposed operating rules do not address the perceived barriers to the use in and of opportunities to improve the adoption of prior authorization transactions.

Opportunities were identified through our survey for improving prior authorization including educating users to reduce confusion and enable automation, which help drive more value from the use of the transaction.  We make the following observations.  Data must be more consistently available, accurate, and complete in order to achieve the greatest benefits and address industry needs.

Data requirements need to be clearly and consistently defined as well as utilized.  Reporting of required data could be more comprehensive by requiring additional transaction capabilities such as supplemental loops and data elements, electronic attachments, identifying a patient’s primary care provider, and health plan product information or estimating co-pay, co-insurance and deductible costs.  Survey respondents suggested the addition of business processes such as the 278 notification and 278 review and prior response while also updating systems to reduce technical barriers will help improve prior authorization functionalities.

Data must be better integrated into operational workflows to deliver greater value.  While lack of sufficient clinical documentation may be a common complaint, more specificity and granularity will not necessarily lead to more value and benefits.  Information must be integrated into workflows in data redundancies with other transactions must be avoided to reduce resource overload and fatigue.  Lack of efficiency is already a common complaint for transactions and more data will not necessarily alleviate the burden.

Various application software must be enhanced to present referral authorization to functionality at the appropriate, strategic points for clinicians, reviewers, and other support staff to facilitate effective, efficient, clinical and administrative workflows and provide real-time responses.

Transactions and acknowledgements must be better automated to improve workflow.  Survey results suggested that significant cost savings could be achieved if manual processes are reduced and/or eliminated from the use of transactions or interpretations are facilitated with clear explanations of codes.

Adoption and use of prior authorization standards, transactions, and operating rules compared to other transactions measured by the survey.  There is still a high variability in the usage of the 278 and operating rules, which may be the cause of continued confusion and consistency.  Moreover, survey respondents indicated the greatest degree of difficulty with prior authorization transactions and operating rules.  Transactions have limited use in the area of actual authorization of services due to requirements for additional, clinical, and administrative documentation as well as limiting factors.  Respondents also reported moderate to significant use of non-batch transactions such as the use of web portals for prior authorization and referral transactions.

Prior authorization transactions and operating rules are not providing value nor achieving intended benefits.  Among the transactions measured by the survey, the prior authorization referral standard ranked last in terms of value.  Only about one-third of the respondents indicated they believe the industry needs are being met and believe that the transaction and corresponding standards, code sets and identifiers are achieving their intended benefits.

Several organizations indicated that they are getting values from the use of the 278 as a means of electronically processing notification of admission transactions, thus avoiding manual efforts.

In conclusion, while WEDI understands the need and desire to move the industry forward with the adoption of operating rules for prior authorization, we urge HHS to work with WEDI to monitor challenges and surveying industry readiness.  It is recommended that a system be developed to capture testing and implementation as we did with the X12 510 database and ICD-10 CM database.

In addition, WEDI encourages HHS to work with WEDI to educate stakeholders and raise awareness on the appropriate use and application of different standards and transactions and code sets.  Thank you for the opportunity to testify.  WEDI offers our continuing support to the secretary and the health care industry.

DR. SUAREZ:  Thank you.  Pat.

MR. WALLER:  My name is Pat Waller with Cambia Health Solutions.  I am testifying on behalf of America’s Health Insurance Plans.  My testimony will include Cambia’s experience with the adoption of the prior authorization transaction as well as a broader industry perspective of AHIP’s members.  Specifically, I will address the current use of the 278 across health care industry, the status of the proposed Phase IV Operating Rules and the need for ongoing iterative development of operating rules and the support of alternative solutions used by the industry.

At the June 2015 ACA Review Committee hearing, stakeholders across the industry testified to the various factors leading to low adoption of the 278 transaction.  Current adoption rates are not sufficient to drive true administrative simplification and are indicative of underlying shortcomings of the transaction.  Prior authorizations require a level of conversation between provider and payer that the transaction cannot currently support.  The current transaction does not support the needed level of clinical data documentation or sufficient automation to deliver value for providers.  Thus, providers continue to rely on manual alternatives such as phone or fax.  Until the transaction can support the clinical data needs and automated authorizations, providers will have little incentive to adopt the transaction and will continue to use existing alternatives.

The proposed Phase IV Operating Rules emphasize infrastructure, which is a needed first step to build connectivity, but they are only a starting point.  Ongoing iterative development is needed to rapidly develop content so that these transactions can begin to drive cost savings and administrative simplification.  Soon after adoption of the initial infrastructure operating rules, we should move quickly toward improvements to content.  The industry as a whole cannot move together toward broader adoption without these developments.

Further, iterative development of operating rules needs to bring various pieces of the puzzle together.  No standalone transaction will ease the administrative burden for payers, providers, and other stakeholders.  For example, the 278 transaction on its own is not very user-friendly or useful to end users.  Prior authorization to tie in with eligibility transactions, the 270/271, as pre-certification and attachment standards to more comprehensively address clinical and administrative needs and reduce reliance on manual processes.

Finally, consistent with the testimony provided by AHIP and other stakeholders at the June 2015 ACA Review Committee hearing, we encourage the Standards Subcommittee to consider the benefits of alternate solutions available to the industry.  While standard transactions and operating rules are critical to connect providers and payers and drive efficiencies, they may also limit innovation.  For example, existing alternatives such as web portals are able to better meet industry needs but can be challenging to use because of existing HIPAA restrictions.

While we support ongoing development of the 278 standard, we also support changes that would better support the use of non-transaction alternatives.  If both trading partners agree to use these approaches, we should have the flexibility to do so.  The industry needs to be able to cultivate innovation in areas that are currently covered by HIPAA as well as those not covered under HIPAA so we can meet the needs of multiple stakeholders and move the industry as a whole forward.  If health plans and providers are limited to the use of the 278 to convey prior authorization, the industry will struggle to move from a transaction-based process to a patient-centered approach.  The industry needs the ability to develop alternative methods of interaction between stakeholders without being in violation of HIPAA.

In closing, we support ongoing development of the 278 transaction to bring additional efficiencies to the administrative process.  However, current utilization of the transaction indicates that there is much yet work to be done.  The proposed operating rules lay the groundwork but rapid, iterative development is needed to deliver content as well as coordination with other transactions and standards to fulfill the needs of the industry, improve adoption rates, and drive administrative simplification.

Thank you for the opportunity to provide feedback to the Subcommittee.

DR. SUAREZ:  Thank you, Pat.  Gail.

MS. KOCHER:  Good afternoon.  Gail Kocher, Blue Cross Blue Shield Association.  Our comments from earlier today regarding the Phase IV Operating Rules still apply and I am not going to reiterate them at this time.  I would make note that the 278 since that it is often conducted in real time is a good example where the difference between connectivity requirements in the Phase IV proposed rules and the existing rules that are adopted by the trading partners could create an additional barrier and impact to both providers and the health plans because many are going to conduct the 278 in the same infrastructure in which they are currently doing eligibility and claim status.

The other thing with the 278 and the prior authorization is that it is really much more of a conversational approach.  That clinical data needs often to be exchanged more in a conversational approach than it is not just always a ask a question and get a response back.  Plans would like to see some additional flexibility with respect to the 278.  Because of the greater clinical data content that the 278 has, it necessitates greater involvement by clinical staff than administration staff to see that greater benefit.

Flexibility to use newer business technologies to exchange that information such as XML via a web portal would help accommodate the need for a more iterative process for those authorizations as there are often additional questions and follow up that are needed.  It is an ongoing exchange between the clinical staff and the health plan.  This would help to allow EDI resources to be focused on other transactions that are much more heavily utilized by providers.

Plans do believe that adoption rates could – they believe they will see an increase in prior authorization, however, upon the ability to use an attachment in conjunction with the prior authorization.  Some of our comments here are reflective back to our June of 2015 testimony.  I will make sure to have that available to the committee members that was part of the packet that is in transit.  I will make sure to get that to you all tomorrow.

DR. SUAREZ:  Thank you, Gail.  Heather.

MS. MCCOMAS:  Thank you so much.  I am Heather McComas from the American Medical Association.  I appreciate the opportunity to speak to you today on the topic of prior authorization on behalf of our physician members.

If I could do this testimony standing on my head to express how concerned physicians are about prior authorization, I would do it.  Unfortunately or maybe fortunately for you my yoga practice has not evolved to that point.  In all seriousness, prior authorization is a huge concern for physicians.

My colleagues and I hear from physicians on this topic every single week, multiple times a week.  We hear about the delays in patient care that are caused by prior authorization.  We hear about the time and resource burdens on physician practices caused by prior authorization.  Because of these concerns, our first priority must always be to advocate for reduce use of prior authorization overall.  But we live in the real world.  We understand that prior auth will be continued to be used for the foreseeable future.  Given that reality, we urge for the industry to move towards a standardized electronic automated process.

Prior authorization is a functionality that is right for automation.  We know it can delay patient care.  It is a burden on physicians and our staff.  It is a burden on health plans as well.  The back end processes of insurance is often very manual and time consuming and uses a lot of resources on their part too.

As we have heard today and we heard last June, the current state of prior authorization automation is frankly abysmal.  It is a very manual process.  I am characterized by phone calls and faxing.  Electronic prior authorization today often means use of a health plan portal.  And while this might offer automation to health plans, it really is still burdensome on the physician practices because physicians have to maintain and manage all those different log-ins and passwords for all the different health plans.  And they also have to exit their electronic health record or their practice management system to enter data in that portal.  It is disruptive to their workflow.

Again, we heard during the Review Committee testimony in June that the industry adoption of the X12 278 transaction is currently very low.  I noted while I was reviewing the CMS final rule on prior authorization DME that CMS said that they would expect to have the ability to accept the 278 at some point and they would let us know when they can accept it.  Even Medicare is not using the 278 right now.

As Gwen alluded to, the CAQH Index indicates the low industry adoption of this transaction.  As you can see here, 35 percent of health plans and providers combined are using the transaction.  I would argue it is much lower than that because these data include health plan portals and IBR response systems.

What are we going to do?  I would argue sitting here today we have a real opportunity to make a difference.  We can leverage these operating rules to really make a difference in prior authorization automation and adoption of the 278.  We have seen from past experience how operating rules and our data can add real value to electronic data interchange and can hasten adoption.  For example, the eligibility response with the patient financial responsibility information has been so valuable both to physicians and to patients.

We have also seen with the uniform co-combinations for the ERA transaction, which also has been very helpful to the industry in spurred adoption of that transaction.

There is a real opportunity here to improve things with these operating rules.  As we have been talking about, the current version of the operating rules for the 278 just address infrastructure – things like connectivity and response times and system availability.  I am certainly not up here saying those things are not important.  They are very important.  But are they going to be sufficient to spur industry adoption and give us frankly the kick in the seat that we might need to get going with this transaction. We would argue no.  We need more from these operating rules to really get any movement on this topic.

Our fear is if we let this opportunity to go by, we will not have this chance again for years to come.  This is such a huge point for physician practices.  We really think we need more from these operating rules.

As others have said today, Gail has said this and Pat has said this, prior authorization is a complicated work process.  It is a conversation back and forth between the provider and the health plan.  We need to make the 278 usage more robust to accommodate this kind of dialogue between health plans and trained providers and make it electronic from beginning to end.

I would give the industry frankly a high school D average on implementation of the 278.  We have taken this lazy approach towards the implementation of the 278, a bare minimum approach.  Right now, a provider can send a prior auth request a 278 to the health plan and the health plan can respond and be compliant and say give us a phone call or go to our portal.  That is acceptable.  That is just not going to get us where we need to go with this transaction.  If we do not ask more through operating rules, we are going to continue down that road of this bare minimum implementation approach, which is getting us nowhere.

We would argue that the operating rules could be enhanced by requiring things like help to indicate and a response of a prior auth and is needed to communicate an approval or deny immediately.  If no additional data are required to indicate what information is needed to fulfill the prior authorization requirements, using the 278 PWK or paperwork segment and also to communicate prior auth determinations to physicians using the 278 transaction.  In other words, operating rules could require that the whole process be automated and mandates multiple iterations of those transactions.

As others have noted too, there are other missing pieces in the prior auth puzzle.  We would argue that the operating rules for the eligibility request and response should be enhanced to require procedure-specific responses that would include indication of prior auth requirements.  This is an important piece of course.  Providers need to know if they need prior auth to get this process off the board.

And then also spoiler alert.  Attachments.  We desperately need an attachment standard as well to really get to an automated prior auth process.

In wrapping things up, we do truly appreciate the work of CAQH CORE on these operating rules.  We largely agree with them.  We have a couple of comments in our written testimony, things that we think should be adjusted in the existing operating rules.  But we really think that they are not sufficient to get us to move forward on this transaction.  Again, this is such a huge problem in the industry.  We really need to take this opportunity to do more to increase savings and time and to most of all ensure patients get their care in a timely fashion.  Thank you so much.

DR. SUAREZ:  Thank you very much for that testimony.  I think we are going to George next.

MR. ARGES:  Thank you.  Again, I am George Arges with the American Hospital Association.  In much of what I think Gwen had to say holds true from the hospital perspective.  It is a huge problem as our candidates in political arena are saying.  It is huge because not only is it difficult for the providers to basically move forward with the care of the patient.  It really sometimes puts the patient under undue anxiety about their particular treatment or illness or services that need to be performed and whether they would be covered.  Having timely information is extremely important.

In terms of the operating rules, I think the connectivity piece is a start, but I think as Gwen has stated, I think there are other things that have to happen.  The utilization of the 278 is lacking considerably.  We have spent too much time basically picking up phone calls, going to web portals to basically get this information.  Oftentimes it takes several days for this information to basically get back to the provider.

Having the clarity of purpose of when to use it and what type of questions that need to be supported in terms of answers provided by the provider under certain circumstances, I think needs to be fleshed out.  Right now, it is wide open and you do not know and oftentimes it really penalizes those who really do a yeoman’s job of doing the right thing only to find themselves getting the okay from the health plan eventually and really they do not have a particular problem.

Sometimes you question.  Is the prior authorization really a gatekeeping function from getting services?  You really have to look at if it is being used for that.  Is there a way to carve out those who do a good job in the services that they provide so that they do not have to go through the hassle of having to do all the prior authorization validation and additional information that needs to be provided?

The attachment is clearly needed because obviously it would be easy to provide additional information as part of that process.  It gets back down to the patient.  I can tell from my own personal experience when I had a kidney stone and I was asked to go take a CT scan, I had to wait seven days before I can get the CT scan, get an authorization from my health plan.  When you are in that much pain, seven days looks like a lifetime.  In fact, I picked up the phone and called the health plan.  They said we will get back to your doctor.  Nevertheless, these sorts of things are things that should not happen in terms of the time delay that currently takes place.

It is really transaction that is ripe for improvement.  It is something that we should dive deep into to basically improve the type of information that needs to be collected, when it needs to be collected, the type of services that will require certain pieces of information to be provided by the provider in the standard way would really make things a lot easier in terms of the exchange of the information to the health plan and back to the provider.

Fundamentally, I think we have a lot of similar things among the provider community.  I will stop there.

DR. SUAREZ:  Thank you.  Margaret.

MS. WEIKER:  Hi.  I am Margaret Weiker, director Standards at NCPDP, which is a not-for-profit ANSI-accredited standards development organization, consisting of more than 1500 members who represent stakeholders interested in electronic standardization within the pharmacy services sector of the health care industry.

NCPDP provides a forum wherein our diverse membership can develop solutions, standards, and guidance for promoting information exchange related to medications, supplies, and services within the health care system.

NCPDP members have limited use of the ASC X12 in Version 5010 278 transaction.  The X12N 278 transaction does not meet the business needs to support medication prior authorization because it does not accommodate the information necessary to facilitate the prior authorization.

The 278 is used by prescribers to request a prior authorization of a medication, supply or service covered under the pharmacy benefit.

Conference calls were held with NCPDP members to obtain input to the questions posed regarding the operating rules for the X12N 278.

The CAQH CORE 452 Operating Rule, Section 3.4 Outside the Scope of This Rule states retail pharmacy prior authorizations are out of scope for this rule, i.e. pharmacists initiated prior authorizations for drug/biologics and prescriber initiated prior authorization for drugs/biologics.  NCPDP supports the exclusion of retail pharmacy prior authorization for drugs and biologics.  With this exclusion, the operating rule would only apply to covered pharmacy benefit supplies or services, which require a prior authorization.

NCPDP supports the decision not to include data content rules into the latest set of operating rules.  Transaction data content and its use is the responsibility of the SDO.  Since data content rules are not contained in this set of operating rules, there is no impact to the HIPAA adopted standards.

NCPDP supports the standardization of Companion Guides through the use of templates.  The cost to develop and distribute an X12N 278 Companion Guide based on the template outweighs the benefit.  With little to no usage of the X12N 278 in the pharmacy industry, developing an X12N 278 Companion Guide using a template will pose significant cost with little benefit.

NCPDP supports the voluntary use of the ASC X12 999 transaction.  NCPDP recommends the ASX X12 Acknowledgement Reference Model be used to determine when an ASC X12 999 transaction is generated.  NCPDP does not support the mandated use of a transaction that has not been adopted through the HIPAA process.

The 470 Connectivity Rule, which supports the next set of transactions, requires the X.509 Digital Certificate to be supported by payers.  The authentication rules need to be consistent across all phases.  Payers/processes will incur additional costs to implement while their trading partners may not use this method.

Security requirements for user authentication are included; however, privacy and confidentiality are not covered.  NCPDP does not believe the operating rules address or facilitate emerging or evolving clinical, technical and/or business advances for the pharmacy industry.

NCPDP believes this set of operating rules do not provide any value for their members.

DR. SUAREZ:  Thank you, Margaret.  Chris.

MR. BRUNS:  I understand we have some slides prepared for today, but I am going to go ahead and skip those.  I would just ask that you listen to my melodic voice.

My name is Chris Bruns.  I am the president of the Healthcare Administrative Technology Association or HATA.  We are the national association representing the practice management systems or PMS industry.  To put it a little bit differently, as I learned at the NCVHS hearing I attended last year, we are the big non-covered entity in the room.  I am also the head of product development for MedInformatix, a certified EHR company based in Los Angeles.

Thank you for giving me the opportunity to present testimony today on behalf of HATA concerning the Phase IV Operating Rules.  We have also submitted a complete written testimony as part of today’s hearing.

Quick background on HATA since we are relatively new to the table here.  We represent a key stakeholder, PMS vendors, and their affiliated vendors in the multi-billion-dollar physician revenue cycle industry.  We are an active and influential voice promoting goals and values on behalf of our members to drive administrative efficiencies for our clients, which consist mainly of providers and billing services.

Our members now represent than 350,000 providers.  Our primary goal, as it pertains to today’s hearing, is to advocate with a single, strong representative voice to influence the health care community on priorities vital to the success of our industry.

On to prior authorizations, a subject near and dear to my heart.  Through 25 years of work with medical specialties that rely on them to get paid for services rendered.  Under the proposed Phase IV Rules, HATA recommends an expanded transaction set and more fully developed operating rules for this transaction set to finally be able to support widespread option.

The current prior authorization process, as we have all acknowledged here, is extremely manual and burdensome and really needs to be replaced once and for all by standardized, automated, transparent, unambiguous health care transactions.  Physician practices, the clients of our members, the PMS vendors, they spend considerable time and staff and resources on the current authorization system, which involves phone calls with multiple transfers, long wait times, faxing, web portal access, multiple web portal access, et cetera.  While this process is extremely burdensome to the physician practice, of course, it is also burdensome on the payers.  They have to spend significant time and resources handling the request either themselves or through TPAs.  It is not a pleasant process.

A standardized, transparent, automated process that fits within the physician’s practice management workflow will benefit all industry stakeholders through reduced processing time, decreased administrative costs and most importantly improve patient satisfaction and care.

Adoption needs to be increased for the ASC X12 278 prior authorization transaction as it is not widely offered by health plans, used by clearinghouses, or implemented at provider offices.  It is across the board, a low adopted transaction set.

Payers often have portal functionality, but they do not readily accept EDI transactions to support an automated prior authorization process.  As a result, HATA joins many others in the industry in advocating for the development and adoption of more robust operating rules for the 278 that will drive widespread adoption and implementation of this transaction.  Furthermore, HATA recommends more adoption of the transaction by the payer communities so the providers will see the value and actively request the utilization of these transactions within their PMS.  I can tell you through personal experience, we do not get many requests from this outside of our cardiology and radiology specialties that we support at MedInformatix, but those two voices are loud.

More PMS vendors are starting to make the ASC X12 278 part of their workflow through certification, accreditation.  Through EHNAC, the Electronic Healthcare Network Accreditation Commission, more vendors are now getting certification to be able to support the 278 transaction.  That is part of the accreditation process.  That is a step in the right direction.

However, the lack of payer adoption and completeness of the 278 transaction makes it a difficult business case to shift resources of PMS vendors, the software developers, for integration and provider adoption.  This is an area where even incremental adoption can make a positive impact on efficiency and cost.  We spend that much time or our customers, the providers spend that much time handling these processes.

In its June 2015 NCVHS testimony on prior authorization, the Cooperative Exchange, the national association representing the clearinghouse industry reported that a majority of stakeholders do not use the prior authorization transaction with only 20 percent of providers submitting the transaction in the ASC X12 format through clearinghouses while 76 percent use a web portal and the remaining 4 percent use other methods.

Infrastructure requirements are important, but they are not going to affect the level of change needed to overcome the poor industry adoption reflected by these statistics.  HATA recommends that the ASC X12 standard transactions be studied to better understand why there is such a low adoption leading to non-usage by providers as well as payer compliance.

Possible items to include would be multiple iterations of the 278 response to support process automation from the initial prior auth request through to the final determination.  It is a multi-step process.

As an industry, we have a real opportunity here to reduce prior authorization challenges and encourage automation with increased compliance that will lead to the definition of a more robust set of operating rules.  HATA urges the Subcommittee to consider our recommendations that will help to automate and standardized this burdensome process.

I have just a few additional recommendations here.  Within the 278 standard, implement, and support both the X12 5010 215 and 217 transactions even for providers that have care collaboration software, a tremendous amount of manual work is still required to obtain pre-cert and referral authorizations, which some payers leverage to automate and reduce phone calls.

Number two, ensure that payer portals, call centers, and health care service request systems are updated simultaneously and near real time.  It is very important.  With so many different data access points out there, it is important to maintain standardization across all systems to ensure consistent information is being disseminated.  I have seen companies out there who are bypassing 278s and developing screen scraping technology to log in and simulate a person to obtain prior authorization because they are finding that they can obtain more accurate results.

Number three, support health care service request linkage to third-party vendors when applicable.  The majority of pre-certification volume is either cardiology or radiology, which many payers employ TPAs to administer.

Last, number four, require the ability to electronically convey information regarding procedure-specific prior authorization requirements to providers in a timely fashion.  Keep them abreast of changes that are required as part of the pre-authorization process.

Thank you for allowing HATA to attend today’s hearing.  We very much appreciate the opportunity and I am personally honored —

DR. SUAREZ:  Thank you very much.  Next we have Connie from CMS on the home.

MS. LEONARD:  Hello everyone.  My name is Connie Leonard.  I am the deputy director of the Provider Compliance Group at CMS.  Today, I am speaking on behalf of the medical review component of Medicare Fee for Service.

Prior authorization is relatively new to Medicare, but as we have been trying to implement it through demonstrations and models and one national program, we have started to wonder, while there is a definition of prior authorization in the regulation, if there still aren’t differences in the interpretation of that definition of prior authorization.  And if so, that is going to make operating rules development very difficult so that everyone can achieve those and follow those and standardize for the industry.

My first point is I think we need some clarification around what is and what is not prior authorization.  For example, in Medicare, a prior authorization while it did not create any new documentation requirements, it is a full review of the medical record.  We just do it earlier in the process.  Medicare Fee-for-Service, either reviews a whole lot of claims, post-pay or usually pre-pay.  After the services are provided, still before they actually provide payment to the provider.  Prior authorization in Medicare is just before the services are provided so it the review of the same documentation.  Providers find it very difficult to use the 278 process when that does not again, answer the attachment issue, which everyone else has all talked about today.

What we found that even though CMS has created 278 receipt process and later this summer will have a construct up in place, using their required x12 standard, no one has tried use it.  We have advertised it to providers.  We have not received any transactions or even had any attempt to transactions.  We have not had anyone ask us about it. Ques us when? How can we do this?  Can you help us?

This really was not unexpected.  We did not expect that providers were going to write that prior authorization request in the required format.  We just knew that we had to be ready.

Today, what we find is providers submit medical documentation through our electronic submission of medical documentation system, which is documentation in a PDF format.  They can submit their request as well as documentation in one transaction or as everyone else has said, they use provider portals or a fax, or in rare cases, mail.

What we have found also is the 278 format does not cover all scenarios in the paperwork for the PWK field.  We tried to reach out to see if we can get that modified, but we have had limited success so far.  Currently only mail or fax or electronic is available and at least no option for CMS’s esMD system, which is the PDF process.

At CMS at Medicare Fee-for-Service, we have a 10 day response time, and that really varies from the current operating rules.  And the reason that we use a 10 day response time is because all of the services or items that we currently require for prior authorization are non-emergent.  And also providers can re-submit a prior authorization request an unlimited number of times.  We found that in the beginning we have a lot of re-submissions that over time providers begin to understand exactly what they need to submit.  But for CMS and even for Medicare providers, since we do a lot of this pre-pay or post-pay review, they actually would prefer a prior authorization.

While it is an increased burden, they would rather have the burden upfront than two or three years after potentially, it was better for them, even as everyone else has said, it is a burden to both Medicare and Medicare administrative contractors and the providers.

Today, if providers use our esMD system, which a lot of our larger facilities do use, they can also get denial decisions back through that system.  Again, something else they would not be able to do.  They would not be able to get that detailed response back through the current 278 process.

CMS believes prior authorization is a good way for us to reduce improper payments and to ultimately reduce burden for providers.  We can lower expenditures.  We can lower the improper payments and hopefully cut down on mail time and the pre-pay and post-pay review that providers are currently subject to.  But to be able to do that, we have to be able to do the prior authorization the way that we intend, which is using non-emergent services and this longer response time because we have statutory and regulatory requirements that they require in some cases, a really thorough review of the medical record. 

CMS is considering for some services, especially in the DMEPOS national rule, that we are going to need to shorten that 10 day timeframe, but that will be a very new piloted test for CMS and certainly not anywhere that we are now.  We are very concerned that any standards and requirements put into place are flexible and allows our definition of prior authorization as well as our process in our response time.

In addition, we are very concerned that Medicare providers come in all sizes and have varying degrees of sophistication as it pertains to electronic submission.  Any standards that are put into place need to allow for that Medicare provider who still wants to mail it in, who still wants to fax it in.  The future needs to allow not only for the changes of technology, which we all know are happening every day, but also not forget about the servicing provider who has not upgraded or for Medicare, maybe only sees a very small percentage of their population and so it is not worth it for them to go through some extensive Medicare process when they have maybe their other payers are larger for their businesses.  The flexibility is really key as HHS determines which standards and which requirements are put in place for prior authorization.  Thank you.

DR. SUAREZ:  Thanks so much, Connie.  I think we are next going to Melissa on the phone also.

MS. MOOREHEAD:  Hi.  Again, this is Melissa Moorehead, calling in to represent the National Medicaid EDI in Healthcare Operating Standard Subcommittee Workgroup.  We have been dealing with operating rules.

The subject of operating rules for the 278 transaction standard for prior authorizations and the other infrastructure rules that impact that transaction has come up several times on the operating standards calls.  Use of this transaction has been very low.  Although almost all participating states having implemented the transaction was part of the 5010 compliance project.

It appears that the main reason for such low usage is that the process of prior authorization is still very manual, and subject to different laws at the state level, such that the standardization does not appear to be immediately feasible across states and an electronic transaction standard does not really enhance efficiency at this time.  This is, of course, particularly true in the absence of a structured data standard for attachments, which are also required for approval.

The purpose of prior authorizations in the Medicaid context is itself not closely related to administrative simplification.  It is primarily used as a cost control or a fraud prevention measure to document a measure of utilization review.  Many states have formal processes requiring manual review of prior authorization requests and they might print confirmations to accommodate providers at many stages of electronic readiness.  The prior authorization requirement and its processes may indeed be very expensive, but it is not clear that operating rules for the electronic transaction will address these issues that are inherent in the process.

We definitely appreciate the desire to encourage uptake of electronic prior authorizations by mandating operating rules that would assure all participants of a uniform implementation of a prior authorization process and transaction.  However, the current landscape is such that it is not clear that the operating rules would be effective for this.  Operating rules for the electronic transaction will not have much impact on the efficiency of the processes themselves.

Real-time processing of the transaction itself or the process is not really feasible in cases where manual review is required.  Processing the transaction or even batch transactions on a different time scale from the actual review process, may result in increased transaction volume, but with less transaction value as the required response would almost certainly need to be set to pending, instead of returning a response only when it contains actionable information.  Implementing these operating rules at this time may lead to further frustration with the transaction instead of enhanced usage.

I would like to acknowledge and second the points made by Debra Strickland earlier, particularly regarding paying close attention to the evidence of necessity of business rules before mandated adoption of operating rules.  This is the basis of the balance needed between mandates that will result in enhanced efficiencies versus those that create compliance projects that actually work against administrative simplification.

Given the extremely low use of the transaction currently, adopting these rules now is akin to performing an experiment in the hopes that they may increase usage with no guarantees, and with uncertain return on investment.  Considering that this experiment would need to be paid for by the public for every Medicaid agency across the nation, this may not be a very efficient use of resources at this time.

Thank you very much.

DR. SUAREZ:  Thanks Melissa.  Dave.

MR. NICHOLSON:  Mr. Chairman and members of the Standards Subcommittee, my name is Dave Nicholson and I am representing my colleagues at the Healthcare Billing and Management Association.

In a few short months, we will be celebrating the 20th anniversary of the enactment of HIPAA.  Prior authorization has been around for more than 20 years, but it has been cumbersome, disruptive, and costly to both physicians and patients.

That was 20 years ago.  Today, even though the health care landscape has changed dramatically, we continue to struggle with prior authorization requirements.  With that in mind, we make the following observations and recommendations.  Number one, prior authorization must be automated and streamlined.  Number two, request and response in real time mode.  We support the real-time processing response time requirement of 20 seconds.  Three, Batch processing mode response time.  We support the batch request time of one hour from receipt.  The next one is the use of multiple modalities to comply with the PA standard.  We recommend that the operating rules be enhanced to ensure that each piece of prior authorization process is accomplished electronically, rather than driving practices to the telephone, health plan portal or fax machine to complete the process, which some would propose are appropriate modalities.

One item that we have repeated many times over the course of years is the lack of enforcement.  Lack of enforcement avoids any penalty on the part of health plans for failure to fully comply with the operating rules or work with practice management vendors to develop the tools necessary to make the 278 transaction viable.

Unless and until and until there is credible enforcement, setting the operating rules standards will be meaningless.  Health plans must be held accountable for failure to offer a true electronic transaction.

Looking to the future, we now must ask ourselves whether prior authorization is still relevant.  If a fee for service as we know it is going to dramatically be reduced in a few years, are the rules and procedures developed for that payment system going to be necessary?

Under the new payment models like ACOs and MIPS, physician and providers will be required to assume a level of financial risk for their clinical decision making.  If the ordering physician is going to be financially liable for their clinical decision making, is prior authorization necessary?

In 2014, Congress enacted the PAMA and included was a provision mandating that in 2017, physicians ordering advanced diagnostic imaging services consult an appropriate use criterion, AUC, for these imaging services under Medicare.  Will these new tools such as AUC require prior authorization?

In an ideal world, prior authorization could go away for many specialties and many services.  However, we recognize that it will take a long time before that day may come.  The Medicaid programs will likely take much longer to adopt the new technologies and new methodologies that will make the elimination of prior authorization much more likely.

In conclusion, HBMA supports the CAQH Phase IV Operating Rules for prior authorization, but we must see credible enforcement of these standards, otherwise, the standards will not be worth the electronic screens they appear on.

I would like to thank you again for the opportunity for presenting here today.  Thank you.

DR. SUAREZ:  Thank you very much.  We are going to conclude with Stacey.

MS. BARBER:  Thank you once again for allowing me to represent ASC X12’s view on the Phase IV Operating Rules.  Our position has not changed from our testimony that we provided a year ago.  We do feel even though a lot of people in this room and through the testimony that has been given today do not believe this that the data content is met within the transaction.  I think that education on how to use the transaction is in dire need and we have always said that.  I feel like I am having déjà vu from the June meeting when we discussed this before.

The Phase IV Rules are focused primarily on the infrastructure and they do include the requirements for acknowledgements.  Again, we support the acknowledgements, but we support them through the regulatory adoption and not through an operating rule and again with the arm being used as that guiding tool.

Again, with the user authentication requirements, we do feel that it does put an undue burden on the covered entities that are required to support the connectivity requirements while providers may choose to continue to use other methods.  We believe that authentication support and in previously adopted rules for other transactions should automatically be supported for any operating rule that may be adopted in the future.

Again, as I said, I feel like I had déjà vu from June when we were talking about the 278.  I jotted down several things that people – comments that people made along the way.  It is not that the transaction cannot support them.  The transaction is very broad in its scope because of the many different requirements across different plans on what is required for authorizations.  We do feel and we will talk about this this afternoon that under attachments is that attachments being adopted for prior authorizations in addition to claims will help in supporting the electronic model of being able to use the 278 – get more use out of the 278 in being able to support that attachment model.  Thank you.

Agenda Item:  Subcommittee Q&A

DR. SUAREZ:  Thank you.  We are ready for our Subcommittee Q&A.  If you have any questions, you can lift your cards.  Terri, actually, you have a question.

MS. DEUTSCH:  Jean, you talked about the survey that you did and I was wondering if you could give a little bit more information about the entities that you surveyed, how many you attempted to survey and what your response rate was.

MS. NARCISI:  We actually worked with the Cooperative Exchange on that survey.  I am not sure how entities were surveyed.  Maybe you know, Sherry.

MS. WILSON:  Sherry Wilson, president of the Cooperative Exchange.  In that survey, it went out to diverse members of WEDI.  And for the clearinghouse, we have over 26 members representing 90 percent of the clearinghouse industry that participated in the survey.

DR. SUAREZ:  Do we have any questions from people on the phone?

MS. GOSS:  I do not right now, Walter.  Thank you.

DR. SUAREZ:  Thank you.  Well, I do have a question.  Gwen, if you want to make a comment first, I will just wait.

MS. LOHSE:  I want to just comment – I know there are some new people on the committee.  I was thinking this might be a useful place to make a comment.  With regard to the content, a number of stated that we do think there should be more requirements for content and that is a journey to go as a next step.  I did highlight that the operating rules are version agnostic in the sense that you could apply them to right now the 5010 or you could apply them to the 6030 or the 7040.  Those are – X12 different versions.

You can also, as Heather and others commented, you could take the operating rules and apply more content.  But the flexibility of the operating rules allows that.  I just wanted to highlight that because I think for the new committee members, there is a flexibility to iterate through the operating rules to add more content with the underlying standards or you have a whole new standard and you can still use the operating rules.  One may be quicker than the other and I think that is some of the comments here.  I wanted to put that in perspective.  Maybe I did not help in clarifying that, but I think it is an important point about how we can continue to drive more content.  As an industry, there are a few different possibilities.

DR. SUAREZ:  Thank you.  In reality, that is applicable to all the operating rules and is really able to be applied to whatever version exists.  If we have these operating rules today that apply to 5010 today and in three years we have 7030 and we do not change the operating rules, they will still be able to be applied.

MS. LOHSE:  Absolutely.  Or you could add on requirements for 5010 and then if it is longer for 7030, you can still use the operating rules.  There are entities through the 130 participants and also the public participants that are doing batch of real time and they are getting value out of it.  They are very small.  But the more we are able to highlight those entities through things like voluntary certification, the more you are going to see people’s names and they are going to show education sessions and highlight how you actually can get this done.  Those type of success stories, moving those forward rather than waiting to move those forward.  We need more of those out in the market place to encourage others to move forward.

MS. WEIKER:  In regard to the operating rules, remember the operating rules cannot conflict with the standard.  We cannot have any conflict between what an operating rule data content may be and a standard data content may be.  It just cannot automatically keep rolling because at some point – and this happened between 4010 and 5010 with the eligibility transactions.  4010 was pretty loosey-goosey.  5010 kind of nailed it down further.  And what CAQH CORE did was then go back into the operating rules and if it was covered in the actual TR3, it was removed from the operating rule.  I just want to make sure everybody realizes it is not just once there, it is always there.

DR. SUAREZ:  Great clarification.  I do remember from the very beginning what the discussion always was.  Operating rules would be able to highlight the issue that in the next version of the standard can be adopted and then the version of the operating rules does not need to be.

PARTICIPANT:  It is a great way to use both of the tools.

DR. SUAREZ:  Thank you for those points.  I do have a couple of questions.

DR. SORACE:  I feel like the tale of two cities with regards to the adequacy of the content of 278 for its purpose.  How would you resolve that?  Is it clear that it needs to be bolstered or changed or individualized on a state-by-state basis or is there no way of coming to a consensus content that would nationally foster implementation?  Are we there already?

MS. BARBER:  As I mentioned, a lot of the things that were mentioned that are problems with the transaction are not actual problems with the transaction.  They are problems with how people implement the transactions.  There is a big difference in the two.  Do we have a gap in what the data content is within that transaction to support the industry need?  There are probably some gaps that are out there that have not been identified because it has not adopted widely.  However, we do have some scenarios where a pilot was done.  Margaret brought up the drug authorization deficiency in 5010, which when a pilot was done under that, that was identified.  And that gap has been filled already within the 6020 transaction.  We are potentially — as it gets implemented and more widely adopted, we are going to be able to find more of those things.  For the most part, it is very – the things that have been brought up, it does support some of the deficiencies that are being reported are deficiencies and implementation not necessarily in the transaction standard.  I just wanted to bring that up.

DR. SUAREZ:  That is a great point.  That was going to be part of my question and my comments here.  This is a very important transaction.  This is and I think as Heather mentioned, this is something that is affecting care.  As George provided in his personal example, this is affecting care.  Many of us might have examples of that.  It is something that we must find a better way to do.  We are hoping as NCVHS that we can contribute to the discussion and the debate.  Maybe at some point, we will have to have a workshop devoted to this particular transaction.

There is a transaction standard and the operating rules.  And the transaction itself I think is important to note that there are many pieces of it.  I think George and others highlighted this.  There are elements that are part of this “transaction” of prior authorization that are really policy points from the health plan side, decisions about which specific items are required to have a prior auth, which are the things that need that type of activity.

Then there is how do you get the information and how do you exchange that information about the prior auth.  What other elements like attachments are needed, additional documentation?  There is that transaction part of it and all these other elements and opportunities to improve and enhance the harmonization, let’s call it that way, or the better process for defining that.  And then there is the transaction itself and the standards, which I think Stacey has said very well.  The standard has a lot of content, a lot of content opportunities that may be are not being properly used.  There is that disconnect.  I think that is what in some ways you are pointing to.

There seems to be a disconnect about why is it that this is one of the most important transaction. There are a lot of processes.  There are a lot of manual elements.  There are a lot of policy elements.  There is the standard itself that allows the electronic exchange of this information, the query and the response.  We are not getting necessarily to that standard to do the electronic transaction.  And whenever it is being done is not being done perhaps properly because the data is there.  The standard has the data.

I guess my question to you all is really and it goes maybe beyond the operating rules.  I think the operating rules we heard a lot of important feedback and generally I think a number of you have expressed that this is a good starting point, but there is not enough that we need to develop more robust, I think it is a word that was used, operating rules that can improve all these processes that we are talking about.  In many ways, the operating rules are supposed to really enhance and standardize the business rules by which the standard is being done.  How much opportunities are there for enhancing business rules that go beyond the implementation of the electronic standard into other things like some consensus around what prior authorization?  I am sure we are going to get that into the attachments where we talk about that too.

The larger question is really how do you all see a way to pursue a better adoption and better implementation of these transactions including the operating rules.  If there is a way that you think would be a good vehicle perhaps.  I am talking about potentially roles by NCVHS or other mechanisms in the industry that could really enhance the adoption of these transactions.  I think Dave mentioned it.  I did not think about it until you mentioned it and it made me feel old.  We are about to celebrate the 20th anniversary in August of this year.  1996 was the signature of – President Clinton signed the HIPAA law.  After 20 years, we are still sitting here talking about things like prior authorization and how to do it.

This is a very important transaction truly.  This is the kind of transaction that stops care and delays care.  Basically, it creates some issue about the effect and efficiency of the care process.  I think it is an opportunity that we need to think about.

I will say it.  I am about to come off the committee later this year and I want to hopefully see that we move into some of this advancement of this transaction specifically.  I am hoping to – it is more a personal passion –

There are some cards up.  I appreciate any comments about how we can help really advance this.  We will start with Heather and then Gwen and then George.

MS. MCCOMAS:  Thanks.  I would jump on that idea of some kind of workshop or something looking right on this transaction.  It could be Walter Suarez honorary – we think that there is some opportunity obviously for the operating rules to be made more robust.  We have some ideas about things as indicated we think could be included.  But do we have all the ideas and solutions?  I am not going to pretend I do.  We need everyone’s brain on this.  We need to all come together.  I do not know what the health plans you are doing behind the scenes.  I do not know.  You need to tell us what you need on your side to make the transactions workable.  I think some kind of big industry something looking at this would be a really great idea and count us in for sure.  Thanks.

MS. LOHSE:  Thinking of four components of this, one being you do need infrastructure to start moving this.  As I highlighted, there are companies that employ people that do the manual work who have called us to say I see these rules.  My people are going to be out of business.  I have to figure out how to go electronic and create something.  We want to keep that momentum moving.  We need to move on the basics and get those going, which is the current set.

Second, absolutely.  There could be more data content and it could be putting some of the optionality within 5010 now.  It might be an option to do that if we want to move fast.

Also the education.  We cannot leave that behind.  A lot of this people sharing best practices.  I think Dave highlight this.  Certification and compliance for all those entities whether it is the health plan, the clearinghouse, the practice management system or if the providers are using the practice management system because the whole flow this all needs to work across.  We would be happy to participate in something like that, but I would hope that it addresses all four of those and it is not just a technical discussion.  It is the business flow, but then the other pieces around the business flow that impact it.

MR. ARGES:  It should be called the prior authorization a la Suarez.  I do agree with what Heather just alluded to.  I think we need to see some normalization around the back end policies that the health plans have around their need for prior authorization.  What is it they are looking for under what circumstances?  When one presents with a given area of treatment, what is it that you are looking for?  It would be easy for us to understand what the rules are and to organize that information and be able to present it in a timely way.  But the back end that exists on the clinical side of the health plan needs to move forward.  They need to basically sit down and figure out how to normalize that amongst themselves and establish some commonality about what needs to be done, when it needs to be done, and how often it needs to be done.

But I also do agree with Dave’s comment.  We are moving into a whole new era of all-inclusive bundled payment models.  The shift is clearly moving towards the provider really taking on the risk.  We have to deliver not only the services, but we are meeting certain performance expectations and quality as part of that process.

Inasmuch as we can understand more about what the back end policies are, I think that would go a long way to figuring out what to collect and what to include as part of the operating rules down the road.

MR. BRUNS:  Since we are all taking a jab at your legacy, I was thinking that we could replace prior auth girl with prior auth man and it could be you.

Just for what it is worth, one of HATA’s three 2016 strategic goals is actually to raise internal awareness amongst our members about prior authorization.  We realize we are an equal part of the equation here and that if we do not offer it inside our software, it does not matter if the payers offer it.  It does not matter if the clearinghouses connect it.  If we cannot ingest it and if we cannot spit it out, it is useless.  We are gathering in Atlanta next month at our spring meeting and it will be a topic of discussion.  We will see what kind of momentum we can gather.

Just one related point.  The order appropriateness guideline law that was scheduled to go into effect January 1, which is going to govern how to ordering doctors order their diagnostic tests has been indefinitely delayed.  Software vendors were constantly juggling balls that – we have to do order appropriateness guidelines and now it is off.  We are spinning on our heels to go do something else.  It is a real juggling act for us.  But this is a really important topic and it is important to me personally.  Thank you.

MS. NARCISI:  Jean Narcisi representing WEDI.  I think WEDI would be the perfect organization to pull together a forum or a policy advisory group.  We have a number of work groups.  We have a spring conference coming up in May.  We either try to tie it in with that or early summer and try to get you some answers.

MS. WEIKER:  From a pharmacy point of view, this committee, the NCVHS committee, made a recommendation in regard to adopting the script EPA transaction.  And of course, we wait for that.  We wait for quantity prescribed.  And we wait for many other recommendations.  I just want to throw that out there in regard to getting prior auths more easily adopted.  There is the EPA.  Even though we have members that are adopting it themselves without any type of mandate and are having success.  But I just wanted to throw that out there.

MS. GOSS:  Walter, this is Alix.  I think that – to recommendation 8.2 of our RC letter that the Full Committee will be discussing tomorrow in support of Margaret’s comments on script —

DR. SUAREZ:  Thanks for that comment.  We are ready for comments on the phone.  Ob, go ahead.

MR. SOONTHORNSIMA:  I appreciate everybody’s input.  I totally agree with everybody’s points.  I wonder when we are talking about trying to fix 278 and then it is pretty much we have not been talking about operating rules so much as 278 itself.  I just wonder whether or not this is a bridge too far, considering some of the comments we heard today that the industry has moved forward.

If you step back and think about the business, what it is that we are trying to accommodate here is basically the – you think about the medical policies, benefit plans, and the third leg is around affordability.  Medical policy coupled with benefit plan basically would drive whether or not a plan is affordable.  With that said, some variations or a variety of business rules that we have to apply to our processes and now the 278 transaction has to somehow be the conduit for all those business rules.  That is my comment.  Benefit plans are not getting simplified.  It is getting more complex.

I wonder if this is in fact a bridge too far.  Maybe attachment is where we need to discuss.  I agree.  But I have heard time and time again today that we are not going to get there overnight and it is going to be a long way out.  I will just that as a comment.  This is not a question.

PARTICIPANT:  Attachment and more eligibility potentially.

MR. SOONTHORNSIMA:  Maybe this is a good segue to the next topic.

DR. SUAREZ:  Your question and your point, Ob, about whether this is a bridge too far.  Personally, this is just my view too.  This is part of the larger discussion about a roadmap and about the transformation where we are expecting to see over the next year or few years about payment reform and alternative payment models and how much all these – administration transactions are going to evolve into the next iteration of methods of reimbursement, et cetera.  I think it is all part of a larger discussion around that too.  But I think we are still going to see prior authorization expectations, let’s call it that way, requirements.  There is a value certainly in helping understand how that fits in today’s world, how we can improve it and how it will fit into the next iteration of payment alternative plans and all that.

Any other comments from anyone on this topic?  Any other questions before we get to public comments?  Any questions?

MS. LOHSE:  I have one comment.  I do agree with the conversation about value-based payments.  I know within CAQH CORE starting at the beginning of 2015, the board asked us to do an assessment of how the operating rules could help smooth the path to value-based payments.  We are not starting out with a million different methodologies in the infrastructure piece as well as the data content and the whole business processing.  There have been seven opportunities identified as well as just options.  We are in the process of interviewing 40 experts.  And the board anticipates having a summary of that in – I think it is the end of Q2, Q3.  We would be pleased to share that.  We already have a white paper on – a five-pager on the analysis and why it is important to get ahead of the game and then also the results.  And perhaps maybe – you talked about having a hearing on prior auth, but maybe it could just be more generally on the new payment systems and their impact on the transactions.

DR. SUAREZ:  I think we are probably going to go there.  Thank you.  Any other questions?  Any comments from the members of the committee?  We are okay.  Thank you so much.

Agenda Item:  Public Comment on Proposed Operating Rules

DR. SUAREZ:  We are going to go to public comments now.  Before we close off this part, we want to hear any public comments on the operating rules.  We will have later this afternoon a chance to have public comments on attachments.

MR. SCHUETH:  My name is Anthony Schueth.  I am the CEO and managing partner of Point-of-Care Partners.  I am a consultant, but I am here on my own accord, my own dime.  I am here because I am very passionate about this topic.

My qualifications for – I guess anybody could make a comment, but I am going to give you a few qualifications.  First of all, I am the task group leader for the NCPDP Prior Authorization to Workflow Task Group.  I have had that role for 11 years.  I have testified to NCVHS four different times on what we are doing on the EPA side on the pharmacy side.

As a consulting firm, we also do a fair amount of consulting in this area.  I think it is relevant to this that our model is to focus on a subject matter and then work with different stakeholders.  My clients are payers.  My clients are PBMs.  My clients are pharmacies.  My clients are providers, technology companies across the board.  We work with all these different companies.

One other thing I think is relevant before I get to my point, which is I got my start and my very first subject matter that I got started in was electronic prescribing.  Why do I bring that up relative to this?  Because electronic prescribing is a success story I would argue.  Eighty percent of doctors today are writing prescriptions electronically.  It is relevant to look at electronic prescribing and the steps that have been taken over the years to get us to 80 percent.  Because I can remember my first introduction to NCVHS was more than 11 years, 2005.  NCVHS was having hearings about electronic prescribing.  Back then, adoption was where prior authorization is today.  We are now at 80 percent of doctors that are prescribing electronically.  How did we get there?

There are a lot of different things.  It started with the infrastructure.  It started with transaction standards.  It started with key stakeholders.  Walter, to steal from what you said, you said that we have the standard.  We have how it is implemented.  We have operating rules.  Yes, those are three really important things.  But I would argue the piece that is missing from that is the motivation.  It is the incentive.  It is why we do it.

The thing about transaction whether it is electronic prescribing, electronic prior authorization, it is a many-to-many transaction with somebody in between.  The challenge that we had in ePrescribing was that pharmacy – I got involved in electronic prescribing in the mid-1990s.  Pharmacy was ready for electronic prescriptions, but the physician side was not ready.

Then the physician side in the dotcom era, they came along with PDAs and they said that they were ready.  But at that point, the pharmacy was not ready.  I would argue that that was not exactly the way it works.  But the point being that it is many-to-many transaction.  What had to happen for electronic prescribing to take off like it did was there needed to be regulation and incentives for key stakeholders, not everybody, but key stakeholders to make that happen.

Margaret talked about prior authorization and I mentioned that I am leading a task group on the pharmacy side.  Growth in electronic prior authorization on the pharmacy side has been about 20 percent a year for the last few years.  It started at a low number.  We are still at a lower number because 20 percent of a small number is not that big a number, but we are growing.

We chose on the pharmacy side not to use the 278.  We chose to create our own standard.  That is part of what you are going to discuss tomorrow it sounds like.  I do not think that on the non-drug side, on the device and procedure side, we do not believe that there is anything wrong with the 278.  I agree with what Stacey says.  It is a fine standard.  It can carry information that is required.  It worked on the pharmacy side because the key players in the industry came together and they came to consensus and they said that this is what we want to do.

What needs to happen on the drug and device side is for the key stakeholders to come together and I would argue and I am going to get to some recommendations.  I would suggest that there are two key stakeholders in the electronic prior authorization transaction.  One of them is the payers.  The payers today do not have systems that can accept an electronic prior authorization.  Let me soften that a little bit.  Many of them do not.  Many of them are using systems and it would require development for them to build the automated back end.

When you talk to the intermediaries and what they will tell you and what they told us is that it has to be at least as fast for the physician as it is today in the paper and fax world.  Starting with the payers, if the payers have not, to Gwen’s point, built an infrastructure, if they do not have – but it has to be an infrastructure for an automated transaction.  It can be faster than what they have today.  If they have not built that yet, you are not ever going to get the physician side to cooperate.  Once they get that side done, the physician side – it is extremely burdensome, as Heather said.  The physician side I would argue will come along.

In order to collate and get everybody together on the same – one other thing.  I am sorry to jump around.  One other thing that is really important in the success of prior authorization for drugs.  There are 27 states now.  Margaret said there is no mandate.  She is right on the federal level.  But on the state level, there are 27 different states that have mandated electronic prior authorization or of some sort of form.  Payers would rather do electronic prior authorization than a form that just creates an extra step.  It is that mandate that I would argue has prompted or encouraged or led to payers, building a back end system in order to be able to respond to electronic prior authorization requests.

My recommendation would be to NCVHS or to anybody that will listen and this is my personal recommendation.  It does not come from any client.  This is Tony Schueth.  My recommendation is to look at incentives for payers, to look at the STAR’s program specifically the patient satisfaction measurement.  To look at the patient satisfaction measurement of the STAR’s program.  If electronic prior authorization would be a piece of that, that would be an incentive for the payers to all build that back end.  The beginning of an incentive for the payers to build that back end system to be able to automatically respond to those transactions.

On the physician side, I would suggest that they also need some sort of an incentive, some sort of boost.  Payment reform will require them to maybe operate it slightly differently.  But if there would be some way that they could get a boost in their MIPS’ payments as a result of doing electronic prior authorization then the payer does not build something and nothing comes.  Both sides of the transaction are positively incented to be able to make this transaction happen.  That is my personal opinion as someone who has invested in this as a consultant and as a volunteer on a task group.

DR. SUAREZ:  Thank you very much.  Thank you for that suggestion.  I really appreciate it.

Are there any other public comments?  Do we have anybody on the phone?

MS. MTUI:  I have an online comment from Robert Hoffman.  I lead the VHA purchased care ADI systems and want the committee to know that VHA as a payer within the next 12 months is implementing functional 278 and 275 processing, including a 278 response requesting medical documentation and the 277 request for additional information then the 275 incoming to VHA with the data.  We can report back next year on our successes.

DR. SUAREZ:  That is wonderful.  Thank you for that.  That is really impressive.  VHA.  Do you have –

MS. MTUI:  V as in Victor, H as in Henry, A as in Adam.

MS. MOOREHEAD:  Robert Hoffman is the same one I believe that has participated in years past with our standards community.  Is it VHA or VA?


DR. SUAREZ:  This is Veterans Health Administration?

MS. MTUI:  Department of Veterans Affairs and yes it is me.

DR. SUAREZ:  That is exciting and very significant.  That exact cycle that includes the attachments, the request for additional information and documentation – I think it is going to be very valuable.  Thank you for that comment.

Any other comments on the public side?  Thank you so much everyone.  This has been a very valuable and significant hearing on operating rules.  I really appreciate very much all the feedback.

Very briefly, we, as the National Committee and the Standards Subcommittee and Ob and Alix would want to correct me if I am wrong, but we will certainly be taking all this feedback.  I know we have written testimony and testimony written by some of the oral testifiers that cover other transactions and we appreciate all that feedback as well.  We are going to be working through all these and hope to have a formal set of recommendations back to the National Committee in the next couple of months.  I think our next meeting is in June.  We will be working through all this.  And certainly the actions by the Subcommittee are brought to the Full Committee for approval and then sent to the secretary.

Again, thank you so much for your feedback.  We are going to move to a break.  I have 3:37.  If we take 13-minute break and come back to 3:50.  We will come back to 3:50 sharp.


Agenda Item:  Part 2:  Attachments

DR. SUAREZ:  We are really excited to bring back this next important topic, which is the attachment transaction.  Very excited about it for many reasons, but one of them is we have already a very formal set of recommendations made by the National Committee after several hearings.  My last count is this will be the seventh hearing that we have had over the last at least ten years if not more on attachments.  This is my second dream or hope is to see that we really move on this transaction.  There has been a lot of exciting, new developments around the standards part of it, a lot more experience and understanding of this transaction and its use.  A lot more interest about seeing that this transaction does not get only attached, if you will, to the claims, but that this concept of attachments is applied to other transactions and we just came from the discussion about prior auth and that being one of the places where the attachments set of standards could be used.  Very excited about this particular period and this particular hearing.

Ob and Alix, would you want to say any opening remarks about this part of the hearing?

MR. SOONTHORNSIMA:  No.  Not really.  Other than the fact that it is quite relevant.  It dovetails real well from our previous conversation 278.

MS. GOSS:  I agree with Ob.  Let’s get moving.

DR. SUAREZ:  We will get started.  We divided this into two parts.  The first part is an update and really a presentation from the standard development organizations of the various components related to attachment standards and then an industry panel to review this.  Again, we will have an opportunity to have public comments as well.

Let’s just go ahead and start.  We have HL7, ASC X12, and LOINC as our standard group.  We will start with Durwin.

Agenda Item:  Proposed Attachment Standard

MR. DAY:  Good afternoon.  I am Durwin Day.  On behalf of HL7, I want to thank you for the opportunity to present on attachment standards.  Dr. Charles Jaffe regrets that he was not able to get here.  He was coming from his home in San Diego, nice, sunny 84 degrees, seven-hour trip.  His connecting flight from Dallas to here was cancelled.  He was not able to be here today with you.  He truly regrets that.

I will attempt to cover a little quick history of what the Attachment Work Group has done.  I have co-chair of that workgroup for a while.  We will talk about our current products and what is being worked on in the future as well.

The Attachment Work Group was born from a Medicare pilot back in 1997.  It was an opportunity for two SDOs to work together and collaborate on a solution for supporting claim attachment processing.  It was where X12 brought in the already established connectivity between a provider and a payer for exchanging the information and HL7 was providing the clinical document architecture for making it both human readable and computer processable.  But the amazing thing is what the group for outreach to payers and providers on identifying the types of requests they did and they did very extensive outreach to domain experts to define the data content for each of those requests.

We also defined LOINC codes that were used as tags for those requests.  That was one of the things that came out of the original pilot that we needed to have that.

What was born out of that then – what resulted out of that pilot were standards called Additional Information Specifications.  It was in Clinical Document Architecture Release 1 back in May of 2004.  It included specification on ambulance, rehab services, clinical reports, medications, lab results and so on.  There were several different members of that pilot from Medicare carriers, Adminstar Federal, Empire Services, Heath Care Services Corporation, United Health and Xact, which is now Highmark.  Those were proposed in the 2005 NPRM rule.  But it was rescinded in 2007.

Along came meaningful use for electronic health records.  This created both requirements and incentives for providers to be able to exchange clinical records and mainly the CCD document along with other documents.  In 2012, HL7 published a standard called HL7 CDA Health Story Consolidation.  It had in it eight different discrete attachment types that notably the Attachment Work Group noticed that one of them was called discharge summary.  We, in our attachment specifications back in 2004, had a discharge summary as well in the clinical notes part.

The Attachment Work Group decided that it was probably not in the best interest in industry to have two different standards to send the same thing.  We did a lot of gap analysis between the Health Story Consolidated Guide and our attachment specifications and found it was pretty much spot on with what we had expected.  We decided to adopt the consolidated CDA Healthy Story Guide as our guide for attachments as well.  That continued to grow.  It was a draft standard for trial use.  It was being used in industry for electronic health records.  It had some issues and things with exchanging electronic health records.

The newest version of that came out in 2014.  It is a consolidated CDA.  It is now called the CDA Release 2, not Release 1 anymore.  As a matter of fact, it went through a couple of releases, 2.0 and 2.1.  It is called Templates for Clinical Notes.  And the latest one has added four more document types to the original eight.  It includes care plan and some other ones.  That is where this has evolved.

Our recommendations from HL7 perspective is for first of all to be consistent with the use of clinical documents and alignment with other use cases for clinical information.  We recommended consolidated CDA.  As I said, Templates for Clinical Notes Release 2.1.  For guidance, two payers and providers on how to use that guide.  We also recommend another HL7 guide called HL7 Supplemental Specifications Request and Response Release 1.  It will be the first release of that guide.

And for optional use, there is another HL7 document that was created called Clinical Documents for Payers Set 1.  Of course, you will hear a little bit more about the LOINC code set that is being set aside for HIPAA attachments, both solicited and non-solicited.

But for considerations in that adoption of those standards, CDA allows you to do different things.  One of them is to send documents that we call unstructured documents.  It could be a PDF, a JPEG, that type of document.  Most of the people that have implemented up to this point have sent to start out with these unstructured documents, using the 275 as the envelope wrapper behind it and inserted the HL7 header with the PDF or JPEG inside of it.  They are already doing it.  In one of the slides that you will see a little bit later, there is a list of all those who have implemented it.

The next step though is to get people to move to structured documents.  To do that, we recommend that we first of all require people to do an HL7 Header and to take the narrative text out of the narrative block as the information to be supported for the claims.  That would be the next step to eventually getting to the point where you are getting a structured document with codified information.

What is happening now?  What we hope to see in the future is not just the CDA part of this, the clinical document architecture part, but there is a new thing you might have heard of.  HL7 FHIR.  You heard earlier today mentioned Fast Healthcare Interoperability Resources.  Resources are a key word in that.

There are pilots out there on using FHIR.  Some of the payers have used it, not just for exchanging the CDA documents, but that is being worked on.  There are other practices as well as exchanging the clinical documents.  But there is a project going on at HL7 called C-CDA on FHIR.  It is an extension of the Argonaut Project.  You might have heard of that.  That is to get those documents that are in CDA into FHIR and those resources and to find it in those resources.

They are expecting the first ones to be the CCD and the Discharge Summary.  They expect it all to be done for sure by winter of 2017.  The way they are working aggressively on this is it could actually be sooner than that.  It could be early 2017 that we will see that.

I will stop there.

DR. SUAREZ:  Thank you very much.  We will go to Stacey.

MS. BARBER:  Good afternoon.  I am Stacey Barber.  I am the chair of ASC X12 and the Insurance Subcommittee.  Again, we thank you for the opportunity to be able to speak with the committee today on electronic attachments.  As Durwin mentioned, for many years now, ASC X12 and HL7 have been working together to develop the standards for electronic attachments.  A significant amount of work has occurred to define the attachments and develop the standards to support those attachments.  And testimony provided in February of 2013, ASC X12 recommended the following standards, ASC X12 standards be adopted, the 278 health care services request and response version 52, the 275 additional information to support a health care claim or a counter version 6020, the 275 additional information to support a health care service review version 6020, and the 277 health care claim request for additional information version 6020.

At this time, we still recommend those same transactions for adoption; however, at this time, we recommend that version 6020 of the 278 be adopted as well rather than the 5010 version.

All of the ASC X12 standards were developed following the ASC X12 standard technical report development process and are published in final form for voluntary use at this time.

Industry-wide stakeholder representation was achieved through development, public comment, informational forums, leading up to the ASC X12 approval and publication.  ASC 5010 transactions supporting ASC X12 evaluated issues identified from industry testing and limited implementation of the 5010 transaction supporting electronic attachment to improve the transactions in version 6020.  Some testing has been conducted using the 6020 with entities preparing for production.  ASC X12 is aware that testing included providers, health plans, clearinghouse and vendor products.  However, we are unable to quantify the sampling size of the pilots.

The ASC X12 standards recommended for electronic attachments align with ASC X12 standards that have already been adopted.  The 275 transaction supports the movement of both structured and unstructured clinical data as a payload allowing for flexibility and implementations.  For example, the HL7 C-CDA can be sent as structured data or a PDF could be sent as unstructured data.

The attachment model supports both unsolicited and solicited detachments.  An unsolicited attachment refers to the act of providing attachment information that conforms to a set of rule-based criteria invoked at the time of the submittal of the health care administrative activity and in the absence of an explicit request.  The information is based on knowledge of the rules defined by the information receiver.  A solicited attachment refers to the act of requesting and/or responding with attachment information, which was requested after the health care entity determined the need for additional information to complete the administrative activity rather it be a claim, a prior authorization, or a post-adjudicated claim request for information.

Currently, there is no functionality within the eligibility transaction that would support requesting attachments, but that is something that could be looked at in the future.

ASC X12 believes that the standard support, the intended business need, in addition to the transactions, a joint effort between ASC X12, HL7, and WEDI has been ongoing to create a guiding principle document to assist the industry with the adoption of attachments through use of implementation of currently mandated standards and through testing of the attachment standard.  We believe that conducting the proposed standard will provide the most efficient method for exchanging data.

It is ASC X12 belief that implementation of electronic attachments will be of benefit in the overall workflow and process.  We believe that the expanded use of attachments for additional transactions other than claims benefits the industry.  ASC X12 believes that proven results and testing and limited implementation of the attachment standards efficiency is achieved from the use and processing of electronic attachments.  As previously mentioned, most testing and implementation have used the 5010 versions.  However, we are aware of some testing and implementations that have used 6020.  We are also aware of organizations that have begun to evaluate the 6020 version to further implementation.

It is our understanding that the operating rules in relation to attachments were put on hold due to no name standard.  We are unable to evaluate in a decrease in cost and efficiencies have been achieved, but do believe that conducting transactions electronically does provide the most efficient method to exchange data.

The basis of ASC X12 standards support and allow for changes in technology.  The ASC X12 275 transactions provide the linkage to associate the attachment to the claim or prior authorization and a wrapper of the structured and/or unstructured clinical data or other such attachments that must be transported and/or agnostic to the transport method.  Simply put, it carries the clinical data and the information necessary to link the data to the related business document.  As previously mentioned, the proposed standards can support both solicited and unsolicited models.

The adoption of the standard set of transaction for electronic transactions will impose consistent and uniform use of transactions putting less of a burden on providers who are responsible for providing the various attachments as required for processing claims or prior authorization.  Through the testing of involuntary implementation of ASC X12 proposed standards for attachments, efficiencies have been proven.  By standardizing the encoding, it allows vendors to support a single solution across stakeholders and all lines of health care business.

As the post-standards accommodate both structured and unstructured data, a phase-in implementation processing from sending unstructured to structured data allows for flexibility and implementations.  In addition, there are mechanisms to request specific information needed in a solicited model, which removes the burden on the provider to guess what additional information is actually needed.  This has been proven through the testing of voluntary implementation that has already been conducted.  We do believe that a minimum of a 24-month implementation period would be necessary for the implementation of these standards.

Since the proposed X12 standards support the use of both structured and unstructured clinical data, we feel that they meet the foreseeable need of the industry.  However, ASC X12 can enhance standards as needed.

There is a clear need in the industry to adopt electronic attachments and ASC X12 feels that our overall testimony has provided reasoning and basis for NCVHS to recommend adoption of these standards.  Thank you very much.

DR. SUAREZ:  Thank you, Stacey.  And then Daniel.

MR. VREEMAN:  Good afternoon.  My name is Daniel Vreeman from the Regenstrief Institute and Indiana University School of Medicine.  I lead the developments of LOINC at Regenstrief.

LOINC has a long history as a proposed code set for use in attachments.  As Durwin mentioned, back in the earliest days of the HL7 formulation of attachment standards, LOINC codes were used to identify those things, including in the NPRM in 2005 and subsequent recommendations from NCVHS as well.  We feel it is a natural fit actually.  This partnership between HL7 messaging or document standard and LOINC codes to identify the clinical content.

I will say a few words about how LOINC was developed in this context.  LOINC was created in 1994.  Its purpose is to create codes that identify test measurements and observations or collection thereof, meaning documents or panels from a laboratory perspective, data sets so collectors and individual data elements.

It is designed to be used worldwide.  It is a global standard with a license that is very user friendly and it is made available at no cost.  Today, there are users from about 172 different countries, 42,000 or so of those registered users and it is really actually ubiquitous in health care around the world.  It is the official national standard in about 30 countries, including here in the US where it is adopted for other things as part of the meaningful use program as well.

While registering for the curator of the content in LOINC, the requests are spurred by this large global community.  They will say in the last four years, we have added new terms to the database based on a request from 195 different organizations from about 20 different countries.  There are currently about 79,000 terms in the database.  No one needs all of them.  For attachments, there is a subset that is directly relevant including ones that we have tagged both use as the structured content as well as another set flagged for use as unstructured attachments.  But there is a process built in to add new content based on end user requests and we do that regularly in updates twice per year.

We also work collaboratively with many other SDOs, including HL7.  I want to highlight how this longstanding close collaboration has worked extremely well and particularly with the Attachments Work Group.  It is actually by design that LOINC fits perfectly as the vocabulary inside HL7 messages as the observation code or in FHIR resources as an observation code or in HL7 CDA documents as the document type code that was all based on this partnership and shared history of how data should be exchanged.

Some of the questions you posed in the panel.  I will try to cover sort of brief responses to.  In regard to how do the proposed standards relate to other programs, for example, meaningful use.  You all know how Consolidated CDA Release 1.1 was named in the 2014 edition and Consolidated CDA Release 2.1 was named in the 2015 edition.  But I also just wanted to mention.  There are other federal programs that have used this CDA plus LOINC inside approach for other things such as CMS’ exchange of Electronic Quality Measures data through the QRDA standards, CDC’s National Healthcare Safety Network.  Their health care associated infection reporting program uses the CDA-based approach.  And CDC uses a similar approach for public health case reports.

In regard to whether the proposed standards could be used in other transactions, from the LOINC perspective I will just say LOINC codes can be used anywhere that you want to identify or you need a universal code to identify a test measurement, an observation or some collection thereof.  Whether it is an attachment, prior authorization, exchange of data between one party to another in a health information exchange and so forth.  It can be used widely.

I do believe that the proposed standards as published this committee were a great start in 2013.  As you have heard from Durwin, there have been some updates in the evolutionary path of the HL7 standards that I did want to mention as well.  The current recommendations named Consolidated CDA Release 1.1.  And there have been two subsequent updates to that: Release 2.0 and Release 2.1.

Personally, I actually like and believe the 2.0 standard is a little bit better than 2.1.  I will not dwell on that for too long.  But it has to do with how it corrected some of the mistakes from the vocabulary usage standpoint and the entry templates of 1.1.

2.1 tried to bridge the lack of backwards compatibility between 2.0 and 1.1.  That was the result of trying to fix some of those mistakes.  It is a little bit kludgy, but does the job.  And ultimately ONC agreed that 2.1 was what they wanted to go with and they named it in the 2015 edition.  For that reason to pair with the existing meaningful use program standards, I do think ultimately 2.1 is a better approach for the attachment context because you do not want to have different things for different purposes.  It is better to leverage the investments people are making already.

I will not spend much time talking about how I think attachment standards can make this process in the health care delivery system extremely more effective.  I believe it is true.  I think you will hear from many of the other panelists later about that, but ultimately the electronic request and exchange of data has a potential to massively reduce the headache and the heartache of a very manual and paper-based process.  LOINC codes are a piece of that puzzle, but obviously not the only one.

Regenstrief as an SDO has not developed specific strategies for measuring the impact of adopting the standards.  That was one of the questions you asked.  But we are open to discussing and partnering with others on this.  We know that the ONC is interested in this and there has been some discussion among members of the SCO, the Standards Collaborative Organization, around how we might measure impact.  But given how LOINC is funded, Regenstrief would need some additional resources to try to tackle that problem, measuring actual impact of adoption.  We focus primarily on the creation and distribution of the standard and not so much measuring how it is actually being used in the real world.

Like others, we recognize that naming standards in this space will require some lead time for people to come up to speed.  We might suggest that three years might be a reasonable time from when the final rule is published to when its implementation might be required.  We recognize there could be some discussion around that plus or minus months, years perhaps.  But upfront development time is needed to get the products ready for market as well as the actual analysis of workflows, changing of workflows and getting those systems into place on both the provider side and the payer side.

Why should NCVHS recommend the adoption of the standards and code sets?  In summary, because I believe it is the right thing to do and it is the right time.  This combination of X12 and Consolidated CDA with the attachment supplement to give additional advice to payers on how to implement it with LOINC inside is the best solution available today.  There is evidence from early adopters, as you will hear, that it can produce real benefits.

I do believe that limiting initial implementation to what is inside consolidated CDA, that is, what providers are already focused on because of meaningful use is a natural first step to bringing this into a larger exchange of data.  But it builds on the existing infrastructure that is being created to support a truly learning health care system.

With that, I thank you again for the opportunity to share.

DR. SUAREZ:  Thank you for that testimony.  We are going to go now to the panel.  We are going to change the order.  We are going to start actually with the pilot that Laurie Darst from Mayo Clinic is presenting.  We are going to start with that and then move from that testimony down the same way we have on the list.

Agenda Item:  Industry Perspectives on Proposed Attachment Standard

MS. DARST:  Members of the Subcommittee, I am Laurie Darst, Revenue Cycle Regulatory Advisor at Mayo Clinic.  I would like to thank you for the opportunity to present testimony today on behalf of Mayo Clinic and National Government Services or NGS, who is our Part B Medicare carrier on our Claim Attachment Project.

Mary Lynn Bushman from NGS was not able to join us today so I will be presenting her portion of the slides later in the presentation.  Laurie Burckhardt from WPS is also on the phone and will be able to answer any questions you may have on the Mayo Clinic/WPS portion of our project.

Mayo Clinic’s Claim Attachment Project actually began way back in 2005 between Mayo Clinic and WPS who is our Part B Medicare carrier at the time.  As we began looking at attachment opportunities, our goal was really to look at cost reduction and saving opportunities.  We wanted to go beyond proof of concept, meaning we wanted to implement this in production long term.  We did not want this just to be a pilot.

We also wanted a solution that could be replicated to other payers.  Our goal was to use a solution that would utilize the X12 275 transaction and the HL7 CDA Release 2.

In 2005, we began reviewing some of our additional document request letters that we received from WPS and identified a high-volume, high-cost request.  An operative report that was consistently requested in situations where a surgical procedure was performed and complications occurred or additional surgeons were required.  When this situation occurred, the coding department would attach a modifier 22 or 62 to the surgical CPT code to reflect that additional costs were associated with the surgery charge.  WPS needed to review the operative report in order to pay the additional costs appropriately.  Mayo Clinic and WPS discussed the opportunities associated with this type of scenario and determined that Mayo would send the operative report unsolicited.  Instead of waiting for that ADR request to come in, we proposed to send this operative report electronically stapled to the claim.

At Mayo, we began working with our internal EDI staff to develop our edits and our claims scrubber to flag these scenarios based on CPT code and modifier and then to automatically retrieve the required operative report from our EHR.  The operative report would be linked to the claim by creating a claim control number, which was then included in the X12 TR3 transactions, the claim, and the 275.

Mayo Clinic and WPS and EDI staff worked together along with a CDA Release 2 expert to determine how to correctly populate the HL7 CDA component.

Mayo Clinic sent the operative report using the HL7 CDA Release 2 data as text messages, not scanned images.  Since Mayo Clinic’s implementation included an automated operative report retrieval process, we eliminated billing staff intervention.  This is unlike most other attachment processes currently implemented in the industry today where billing staff must access the EHR system, copy the medical record into a PDF, and then upload it into a portal.  We built a much more automation into our process and thereby limiting our staff time.

Most of our IT effort was actually spent on this internal process portion of our implementation.  We successfully tested the 275 and the CDA Release 2 with WPS and moved the unsolicited attachment into production in the spring of 2006.

Then in 2013, NGS became our Medicare carrier in Minnesota.  In August 2013, Mayo Clinic began working with NGS staff to try to replicate the operative report attachment project that we had previously implemented with WPS.  Since the internal implementation process remained the same for us, we only had to make modifications to the 275 version.  NGS wanted us to move from 5010 to 6020 and then to complete testing to ensure production readiness.  The electronic operative reports were moved into production with NGS in February 2014.

I just want to share a couple of Mayo Clinic’s project results whether with both NGS and with WPS.  We continue to receive cost savings and payment delay reductions.  Results reveal that staff time for this process was greatly reduced, thereby decreasing our cost.  Mayo Clinic also discovered that payments for these types of services were received 25 to 30 days earlier than the previous paper processed.

The electronic attachment process we created for operative reports in 2005 was relatively easy to replicate with our new Medicare carrier.  In 2013, our bottom line success story.  Mayo Clinic has been successfully submitting unsolicited electronic operative reports to Medicare for the past ten years.

I just wanted to share a couple of quick comments regarding high-volume attachment types.  In 2005 and then again in 2011, we completed an analysis of the types of attachments and the volumes that we received.  These included operative reports like I have talked about with the 2262 modifier that we pulled from our HER system.  Miscellaneous procedure code descriptions where – the description goes beyond the 80 bytes allowed in the claim where we actually have to send an attachment.  That actually comes from our practice management, not our EHR system.  We have a few invoice purchase price items that we have to send to Medicare that actually come from our supply chain.  And then we have the radiology lab and clinical notes.

Again, I just wanted to point out that – to make sure that everyone understands that not all attachments come from the EHR system.  A high volume of them actually come from our practice management system.

I also wanted to mention that all workers comp claims require attachments.  We currently route these attachments electronically with our claims.  However, for workers comp process, we are currently manually converting those clinical notes to the PDF and then submitting these using the clearinghouse portal.  For those we did not create that Cadillac model that we have for the operative reports.

Now, I would like to just share the NGS perspective on the 2013 claim process.  NGS is National Government Services and is a Medicare contractor for JK and J6 jurisdictions, which include New York, New Hampshire, Maine, Massachusetts, Vermont, Connecticut, Rhode Island, Wisconsin, Minnesota, and Illinois.  On August 12, 2013, NGS did receive CMS approval to implement these electronic attachments in production.

Their project scope included CMS’ approval to be able to implement this electronic attachment.  The scope is also to support the unsolicited attachment sent with the claim and then to initially only support those operative notes with the surgical procedure with the 2262 modifier.

Their objectives were to accept and process the X12 275 version 6020 with the embedded HL7 CDA Release 2 in the binary segment.  To accept a process, the HL7 CDA R2 unstructured as text data.  The X12 HL7 would be formatted into an XML file and unstructured data captured in a separate text file and then the XML file and the text file would then be ingested into their imaging system, which would enable their operative staff to view the data for processing.

The X12 275 and HL7 would be subjected to the same authentication and authorization as all the rest of their EDI transactions.  They would generate an X12 999 acknowledgement report that looks at the standard level edits and that they would also need to support their EDI enrollment process and set up also for this attachment process.

Some of NGS’s assumptions.  Initially, they were going to just look at supporting Mayo Clinic’s need for spending the unsolicited operative report, but with the plan that they would replicate this beyond Mayo Clinic to other providers.  That their claim adjudication would be based on medical examiner manual review of the attached data.  Nothing would change with their process.  That their Medicare shared systems, FISS, MCS, and their common edit module would not need to have any changes made and that there would be no changes to their current flow process for claims transaction.

Their results.  Again, they did receive the CMS approval August of 2013.  Moved Mayo into production in February of 2014.  NGS has received these transactions daily since that February 2014 time period.  They have received over 3300 attachments from Mayo in the last year.  No significant issues were identified.  They also identified that Mayo was being paid 30 days sooner and that there were mailroom task reductions that they found decreasing their cost.

Now, what I would like to do is share some joint lessons learned, including successes, challenges, and recommendations.  First and probably most importantly, our successes.  We were able to successfully use the X12 275 and HL7 CDA Release 2 for electronic attachments.  We also proved that these transactions reduce cost for both the payer and the provider.  We determined that the use of the X12 275 transaction allowed both the claim and the corresponding attachment to be routed through the same EDI gateway.

For Mayo, we found that this process once all the internal IT work had been done could be easily replicated with other trading partners.  Mayo also found that sending the CDA directly from the EHR system provided more automation opportunities for the provider than uploading a PDF file into a portal.  Certainly, there are opportunities, maybe even kind of a step one, step two type thing if you do not have the automation process of being able to upload those PDF files.

And then finally, the unsolicited attachment provides the most benefit for both payers and providers.  We did, however, identify a few challenges.

Generally, providers and payer that work in the administrative transactions or EDI have limited to no experience with HL7 standards.  In our case, WPS, NGS, and even our Mayo EDI folks.  We had to reach out to a CDI expert in order to complete our programming.  Thankfully, we had one internally at Mayo that was an expert in this area.

We also found some challenges identified with the HL7 CDA that multiple HL7 documents were needed to be referenced.  That the documentation was not easily interpreted again by our EDI folks.  That the documentation was not always easily found on the HL7 website.  And that the HL7 technical assistance was needed.

Mayo and NGS would like to offer the following recommendations moving forward.  We recommend that there is a single source to download all necessary documents required to implement the mandated electronic attachments.  The significant education is needed.  The HL7 component, the use of the multiple standards, the business aspect of attachments, a possible creation of an Attachment Quick Reference Guide for C-CDA and then a technical resource.

We recommend that X12, HL7, and WEDI all work together on this education process.

We also need to ensure that EHR and Practice Management System vendors are engaged in the administrative attachment process.  We know that EHR vendors are engaged in the clinical implementation process, but are concerned with their lack of apparent engagement and the attachment development process.

We recommend that the 275 transaction, along with HL7 Consolidated CDA be named attachment standard.  The use of the 275 allows that provider to send both the attachment and the claim through the same EDI portal.  The C-CDA supports a single standard to be used for both the transition of care and administrative transactions.  We need one standard.

Also to recommend unsolicited attachment to be included as part of the attachment standard.  We feel that this provides the most opportunity for cost savings and it should be allowed by mutual trading partner agreement or operating rules.

In summary, I want to leave this on a positive note.  Our electronic operative report attachment project was a resounding success for all of our implementers, Mayo, WPS, and NGS.  We have been able to successfully implement the 275 and the CDA.  We have proven that electronic attachments can save money for both the payers and providers.  There is a huge opportunity for process automation if done correctly.  There are definite benefits of the unsolicited.  But education and vendor engagement will be essential as the industry moves forward.  Thank you.

DR. SUAREZ:  Thank you so much for that journey really through the experience that you had.  Very valuable.  We are going to go next to Heather and then go down the list as we have it on the agenda.

MS. MCCOMAS:  Thank you so much again.  I am Heather McComas from the American Medical Association.  We appreciate the opportunity to talk to you today on behalf of our physician members on the subject of the attachment standard.  This is a really important topic and I think it is particularly important when we think about it in terms of what is going on today in our industry.

Health plans are increasingly using cost containment and utilization review programs and almost without exception, these programs require submission of additional clinical documentation from the provider to the health plan.  That gets us right to what we are talking about today, which is the electronic standard for an attachment.

The AMA in general opposes broad-based requests for clinical documentation from providers to health plans because this is burdensome for the provider in all cases.  However, given the fact that these programs are here to stay for the foreseeable future, we do strongly urge the industry to adopt one single way of exchanging this clinical data in a standard way.

I like the phrase that Daniel used.  I think you talked about the heartache and the headache of the current manual system of exchanging clinical documentation.  Oftentimes providers today are faxing paper or they are sending it via the US mail, which his really expensive and burdensome on providers.  I would probably guess on the payer side, it is not any more fun to deal with all that paper.  We know that the current manual system is very costly to the industry as a whole.

In the absence of a standard for an electronic way of communicating clinical data, I would describe us of having arrived at a situation of genetic drift where everyone is doing things a little bit differently, their own little islands.  This Wild West environment is actually quite harmful to providers because providers have to interact with all the health plans.  They have to accommodate all these different manners of clinical data exchange whether it is being done via secure email or health plan portal or the health plans that are using electronic standard transactions.  Providers are burning because they have to accommodate all these different species that have evolved out in industry.

A lot of the provider burden.  We would say this is the antithesis of the purpose of HIPAA Administrative Simplification.  The goal is to get us all on the same page doing everything the same way everybody so that we all save time and money and that is not where we are right now.

I think it is also worthwhile to point out that I think one of the things we are supposed to think about in terms of today’s discussion was – the standards we are looking at.  Do they increase consistency and reduce ambiguity in our industry?  And the answer is a resounding yes.  It should be our goals for moving ahead with an attachment standard.

As others have already noted, there are multiple standards actually involved and the exchange of clinical data in our industry.  It is complicated because there is an administrative side and a clinical side.  You have different groups of people and organizations working in these different areas.

We do strongly recommend standards for all these different pieces of the process.  We recommend the X12 278 and 277 transactions as the standard way for health plans to request additional documentation from health plans.  For that envelope that would carry the clinical data, we recommend one of the flavors of the X12 275 additional information transaction.  And then for the clinical content, we recommend adoption of the HL7 C-CDA R2 for the standard way to communicate the clinical content.

We will readily admit that the standardization of the clinical piece has been a subject of some discussion and perhaps disagreement in the industry.  From a provider perspective, we feel that it is very important that one single electronic document that is created as a result of patient encounter could serve multiple purposes.  It could be sent to another provider to communicate transaction of care details.  But it could also easily be sent to the health plan and used for health plan purposes.  We firmly believe that it should be only one standard for the clinical content piece of the attachment standard.

We do not support including the clinical document for payers or CDP1 in the standard for the clinical content because we have real concerns that physicians would be in some cases at least required to create two different forms to document a single patient encounter, which is obviously extremely burdensome from our perspective.

And we also have a concern again that it would propagate the Wild West we have right now.  Some health plans might require the C-CDA R2, others the CDP1.  And again, we have doing things for different plans, which is again against the spirit of administrative simplification.

The reason that we support the C-CDA R2 as a standard versus a CDP1 is first of all the CDP1 requires completion of significantly more templates than the C-CDA R2, with use of null flavors to reflect uncollected data or data that the provider does not wish to exchange.

We have concerns that the requirement to include these null flavors could be first of all burdensome to providers and go through and say I am not sending this.  Additional administrative burden on providers.  But also we have concerns that this could encourage the exchange of clinical data beyond what is needed, in other words, violating the principle of minimum necessary data exchange under HIPAA.

However, we will recognize the fact that there have been some valid concerns that have been raised in the C-CDA versus CDP1 discussion that has happened.  The first is that CDP1 does have these additional templates and information included in it.  We urge industry to go back and look at these additional capabilities of CDP1.  If they are in fact really important and we need them there for clinical data exchange then we should consider them for inclusion the next version of the C-CDA.  We think it is very important that any enhancements or additions all happen with one single standard.  My message to you today is standard equals one if I could leave you with one sound bite.

Another concern that has been raised that we do hear the validity of is that vendors may not support all of the different forms and elements of the C-CDA R2.  We do have concerns if vendors are not going to include these optional elements and their implementation of the standard.  We urge the Subcommittee to recommend changes in vendor testing that will allow for evaluation of vendors’ support of these optional fields because providers need to have access of those optional fields so they can use them when they need to use them.

Beyond these recommendations on the standards, we do have some strong concerns that we feel that the Subcommittee could address and other guardrails that we feel should be put around the exchange of clinical documentation.  First of all, we really do urge industry to use attachments judiciously.  They are burdensome across the board.  It is burdensome for us as providers to send them.  I would argue although I do not sit on that side of the table that they are burdensome for the health plans to consume.  We should really only use when structurally necessary.  It should not be used in a routine fashion.

We also urge for uniformity and when attachments are needed so that providers can send them in an unsolicited fashion, much as Laurie was talking about.  Mayo knows that for these certain situations they always need to send in attachments is what we should really aim for so providers can send them without having the health plan request them.  It saves us all a step.

And then finally, we believe the health plans should be prohibited from requesting the same clinical information more than once.  You have heard stories of this.  Sometimes different areas of the health plans are not talking to each other and providers can be asked to submit the same data twice, which is obviously a huge waste for all of us.

I will close with getting back to the 20-year anniversary point.  We have been waiting around for a while for a standard here.  It is time.  This wine is perfectly aged.  We really need a standard.  This is critical.

Something that really struck me I guess almost two years ago.  The June 2014 testimony before the Subcommittee.  A vendor and a very large vendor indicated that the uncertainty in this area has had a paralyzing effect and has served as a disincentive for vendors to do development in this area.  I really would like the Subcommittee to go back and look at the testimony.  It really struck me and stayed with me.

We all really need guidance desperately in this area.  Vendors need guidance.  Health plans need guidance and providers need guidance.  We all have our boots pointed in the same direction and so we can all exchange data in a way that is cost efficient and save us time and money.  Thank you so much.

DR. SUAREZ:  Thank you.  George.

MR. ARGES:  Thank you.  As Heather just indicated, we also believe that the time for utilization of the attachment standard is way overdue.  The attachment standard is designed to provide the supplemental medical documentation that is necessary to support information found on the claim.  It cannot be accommodated within the format of the claim.

We know that presently providers are confronted with a variety of different proprietary approaches from health plans for supplying attachment information.  And that having a claim attachment standard names as the HIPAA standard would alleviate the burden of having to deal with a vast assortment of different health plan approaches for supplying this additional information.

We also know too that the attachment standard really relies on external code lists such as LOINC to basically identify the nature of the information being transmitted and therefore it is very agile and capable of adapting to changing technology or new payment models.  The claim as presently designed is not as agile.

The attachment standards serve as a primary vehicle to pull the information from medical records as well as other areas within the hospital system.  It could be structured or unstructured as others have indicated.  Therefore, the cost to report the supplemental information via the attachment is much lower than trying to modify the existing billing legacy systems in order to support ad hoc information on the claim.

It should be noted that when the information found in the medical record is identified as one of the meaningful use requirements, it will then meet the HL7 requirements and can be designed to be machine readable, making its use even more efficient.

As Heather indicated in her presentation, there are some caveats.  We too have some caveats with the adoption of the claim attachment.  We would like to see instructions for information needed on the claim attachment to be clear so that the processing of the claim is not delayed unnecessarily.  That pre-authorization that we talked about earlier also must be able to support the use of the attachment and serve as a basis for identifying any additional supplemental information needs that were identified in the pre-authorization.  It can be communicated early on as part of the submission with the claim.

When a claim is submitted and the health plan notices that more supporting information is needed, the health plan must communicate back in a timely fashion the nature of the supporting information it needs to complete the adjudication and expedite payment.

We also believe that the number of attachment requests per claim need to be limited to a reasonable number, perhaps two.  It should be done in one request, not multiple requests.  Additionally, requests for additional information using the attachment should never include information that is already reported on the claims standard.  In other words, somebody is not spoon feeding the same result that was already indicated on the claim as a codified response.

Other than these caveats, the claim attachment serves an important purpose in function.  We, therefore, urge the NCVHS to move forward with a recommendation to adopt the latest version of the claim attachment standard as the HIPAA standard.  We agree also with the C-CDA R2 as the basis for reporting this information.

That is fundamentally our testimony.

DR. SUAREZ:  Thank you, George.  Rob, you are next.

MR. TENNANT:  I want to thank the Subcommittee again for allowing me to present the views of MGMA.  I am Rob Tennant, director of HIT Policy for the association.  We still have 33,000 members and last week they all called me, letting me know that they are very dissatisfied with the current claim attachment process.

I wanted to give you a sense of the environment and you have heard some of this.  We did a survey of our members.  More than half answered always or often they got a claim attachment request and that exponentially grew when it was a workers comp.  But for some specialties, particularly orthopedics, it is almost every single time a claim is submitted that there is an attachment request.  The payer sends it of course by paper, which are often lost are they are sent to the incorrect address.  Again, it is very difficult at times to figure out what the payer is asking for, which I think is a common theme.  We are looking for specific information to send.  Again, the real world of health care is so many practices when they get that request, they photocopy the entire record, put in a FedEx envelope and cross their fingers.  That is a cost to everybody.

In terms of cost, we asked our respondents what was the cost for an attachment.  If you can believe it, the average was $21.34.  That is per request.

Obviously, huge benefits to automating this process.  It eliminates lost requests and lost responses, reduce costs associated with the staff and collection and sending.

The hope is of course that once the process is easier, there will not be so many requests to begin with, but certainly there will be improved predictability of what the payer is requesting.  Very importantly, improve claim re-association.  I think that will benefit both the provider and the plan.  Reduced number of pending claims, denials, appeals, faster payments, and decreased days in accounts receivable.  But once you have the standard, I think it opens the door for additional functionality that goes beyond claims.  I think that was one of the questions asked.

There is a great and growing need to move clinical data between care settings, between payers who are looking to coordinate care.  Once you have that standard, transitions of care, care management, quality reporting.  We talked about meaningful use, but there is also the Physician Quality Reporting System, PQRS.  That is not going away.  That is a component of MIPS.  That along with a value-based modifier.  All of these are going to require information to move.

But there is another side of the macro world that is coming and that is alternative payment models.  We are looking at patient-centered medical homes.  We are looking at accountable care organizations.  They run by exchanging clinical data.  If we can have a simplified approach to that, it would greatly benefit certainly group practices.

In terms of the recommendations, no surprises here.  A lot of synergy with the provider world.  The 278, 277, 275.  Again, we support the HL7 C-CDA R2 as well.

We do not believe that trading partner agreements should be allowed in terms of the standard itself.  There has been some talking – about allowing “payers and providers” to agree on a different standard.  We are opposed to that because what happens again in the real world is unless you are a Mayo, you have no power to negotiate with the health plans.  We would like to see that eliminated with the exception again of unsolicited.  I think once we can agree on when additional documentation is required through trading partner agreement, a lot of the hassle can be eliminated.

I wanted to highlight one of the pages from the CAQH index.  We have seen this – 7 percent prior auth.  But what is interesting is remittance advice is only at 47 percent adoption for providers.  What does that have to do with claim attachments?  It is really that we need to make the standard simple and usable for all providers.  God love Mayo, but they are not average.  We need a standard that works for the smallest solo practitioner all the way up to Mayo.  We are looking for more of a glide path, a flexible glide path towards full adoption.  Yes, we love LOINC.  There is no question.  But the reality is we need something to start with.  We need a simple way to move clinical data from point A to point B, unstructured even if you have to print it and scan it, throw it in a standard envelope.  At least it is better than what we have now.  Then you can move towards more structured data with narrative text and ultimately towards structure codified data, which is going to be really where we all want to be within 100 years.

In terms of additional recommendations, we do oppose the Clinical Document for Payers.  We do not believe two standards is the way to go.  We also believe that we need to aggressively educate not just providers.  I think we can buy into this quickly, but also the vendors.  They are the missing element here.  We need to have them on board as well.  One of the ways to do that is through certification and accreditation.  I will go back, Walter, to something you said last summer, which is can we move this group of stakeholders into the world of business.  Is that a lever that we can use to push them to support these standards?

We have talked about the need for having the standards.  It has been 20 years, but for those in Washington, you know the system.  If CMS comes out with a regulation even as early as October/November that immediately is going to be put on hold by the new administration.  We saw that with privacy where the Clinton Administration came out with a final rule on privacy at the end of the year in ’99.  It was immediately stopped by the Bush Administration.  Understanding that, we are not looking at a standard for probably until 2019, maybe 2020, maybe further.  Should we just sit back and wait for that?  I would argue no.  I would argue that the industry needs to coalesce around something that we can agree on.  I think operating rules is probably the first way.

To build on what George said, there are plenty of things the operating rules can address, things like prohibiting information already on the claim, which just drives physicians crazy.  Prohibiting the same data from being collected multiple times.  The timing of payer request.  No requests after X number of days following receipt of the claim so they are not slowing down the claim.  The maximum time allowed to adjudicate the claim once they have received that attachment.  Also, of course, consistent formats and the old infrastructure standards.

I am going to push the industry perhaps through WEDI and some other channels to really move ahead in lieu of a standard because frankly I do not think we are going to see one any time soon.  Thank you.

DR. SUAREZ:  Thank you, Rob.  Thank you for that testimony.  Christol.

MS. GREEN:  Thank you again, Mr. Chairman and members of the Subcommittee for letting us testify this afternoon on the attachment standards.

We have also filed a more inclusive written testimony with the Subcommittee.

Again, I am Christol Green and I a Senior Business Consultant with Anthem Incorporated.  I have been working in the health care industry for about 30 years, last 20 with HIPAA Administrative Simplification transactions, other types of electronic transactions and implementing them with health care industry.

I currently am a member of WEDI, X12, HL7, NPAG, and other health care related industry organizations.

With 72 million people served by its affiliated companies, including more than 38 million members enrolled in its family of health plans, Anthem is one of the nation’s leading health benefits companies.

On behalf of Anthem and as an organizational member of America’s Health Insurance Plans or AHIP, I would like to thank you again for this opportunity to respond to the Subcommittee questions and provider perspective on these proposed standards for attachments.

We hope that sharing our experience and recommendations with NCVHS will help improve efficiencies and usage of electronic health care transactions.

The standard should support all types of services that require attachments both administrative and clinical, including claim payments, prior authorizations, referrals, notifications, post-adjudicated claims, care coordination, and other clinical exchanges.

We have seen the absent of the regulation has left the industry to develop mostly proprietary processes, which only address a very small percentage of attachments necessary for administrative and clinical purposes today.

There are a variety of electronic transmission methodologies used today based on the stakeholders and EDI readiness.

There is a dependency on flexibility of these various methods because they were developed and adapted by the needs of these various stakeholders.

The potential impact and efficiencies are significant for all entities with the adoption of an attachment standard.  You can see that from what Laurie presented earlier.  Automate end to end workflow processes across stakeholders to streamline clinical and administrative processes.  Decrease administrative cost associates with paper processing today.

Heath plans have piloted earlier versions of the attachment standards and use of HL7 or proprietary clinical data standards to exchange some of this data today.  Given that the return on investment has been significant in these pilots, we would expect that the proposed standards have the potential for similar efficiency improvements.

Anthem has proprietary processes also in place today.  For the claims attachment and again these are all unsolicited, we used medical electronic attachments, MEA for the medical side, NEA for the dental side, and we also allow our providers to submit 837 claims with the PWK tracking information in which they either mail or fax the paper attachment.  We have seen a little cost savings achieved, but again it is minimal as not many providers have adopted these processes.

Anthem is also conducting some minimal HL7 and other clinical data exchanges.  We also want to emphasize that the industry needs sufficient lead time and flexibility in implementing this standard.  We recommend at least two years or more after the final attachment standard is announced in order to plan and align resources necessary for implementing and compliance.

It is also important that the industry is offered approaches for adoptions that allow flexibility for new and/or advancing technologies.  For example, we see the need for flexibility in the standard that would allow mutually agreed upon trading partners to use alternative methods to exchange health care attachments not to disturb their current processes.

Furthermore, there may be risk in citing future standards that are still in Draft Standard for Trial Use of development, where the DSTU could still undergo extensive changes.  This could pose a risk to the health care providers, EHR vendors and payers as they take action to any of these changes in the standard.

Anthem supports the adoption of the proposed standards including the following recommendations.  This is pretty close to the others.  The enveloping X12 275 for encounter and service review, the X12 277 request for additional information, the HL7 Consolidated CDA Release 2.1 both structured and unstructured document types, HL7 Supplemental Guide for attachments that has been drawn up, the HL7 Clinical Documents for Payers Set 1.  We would say we would like to see that as optional, not required.  And Logical Observation Identifiers Names and Codes, the LOINC Codes to identify or request attachment types.

Electronic attachments are a high priority for administrative simplification from a health plan perspective.  The industry will benefit with specific standards named with attachment rule.  We encourage you to offer approaches to adoption that allows for flexibility for advancing technology.

With that, I want to thank you again for allowing me to speak today and I will take any questions at the end of the session.

DR. SUAREZ:  Thank you.  Gail.

MS. KOCHER:  I am Gail Kocher with Blue Cross Blue Shield Association.  Neither my company nor I have changed since this morning.  I will dispense with who we are comments for this afternoon.

The comments that we do provide today in response to the questions posed by the Subcommittee do represent a representative view of the Blue Plans.

As we have testified before the Subcommittee previously on attachments, today I would like to summarize a few key points and then focus on one question in particular.  First and foremost, we continue to strongly support standardization, which brings value to all stakeholders within our industry.  Rules for attachments that automate today’s largely manual processes have the potential to generate significant savings for all stakeholders.  Further, we support the rules being applied not only to claims transactions, but also to referral and prior authorization, through a staggered implementation approach.

We have several overarching recommendations to enable the realization of these goals.  Build in flexibility allowing mutually agreeing trading partners to use flexible methods to exchange health care attachments.  Make standards, protocols, and rules for health data exchange fully open and supportive of data portability and interoperability.  Put limits on unsolicited attachments, avoiding unnecessary work in the management and control of unwanted and unnecessary documents.  Plan for extensive provider outreach, encouraging participation that enables fully realizing the value of proposition.  Sequence the implementation of operating rules such that finalization of operating rules is after finalization of the transaction standards.  And stagger the implementation of attachments for all other uses after the claim, that is, the referral and prior authorization and other business purposes, to limit operational overload and facilitate other IT priorities, such as clinical interoperability.

Plans have indicated that the lack of attachment standards creates a barrier to administrative simplification.  Implementing attachments creates an opportunity, which meets Plans’ needs when additional clinical data is required for prior authorization or claims adjudication.  For prior authorizations, the more conversational need to exchange clinical data would benefit from the ability to conduct that exchange electronically.  Having the flexibility to exchange the attachment standard via newer business technologies may benefit providers, whose plans have indicated often prefer to use portals for prior authorization processes.

NCVHS noted in their draft Review Committee Findings from the June 16 and 17, 2015 NCVHS Hearing on Adopted Standards, Code Sets, Identifiers and Operating Rules letter that health plans web portals have become predominant venues for providing greater level of functionality and information exchange to achieve prior authorizations.  As a support to claims adjudication, attachments via electronic methods will facilitate more timely processing as electronic data can be associated much more efficiently than paper attachments.

In terms of administrative process costs, Plans do believe that adoption rates for electronic prior authorizations might increase when attachment standards are adopted, which has the potential to decrease overall costs.  They also indicate that moving from paper to electronic attachments will decrease manual resources needed to scan and process paper attachments into processing systems, freeing up resources for other tasks.

We know that attachment standards can be operationalized.  Plans have participated in pilots of earlier versions of the attachment standards and use clinical data standards to exchange some clinical data today.

BCBSA supports the adoption of attachments.  We recognize their value in achieving the overall goal of quality and affordable health care.  Affordability and quality necessitates the exchange of patient information.  Plans see attachments as a priority for administrative simplification.  We believe attachments should continue to move forward for adoption, even while other HIPAA administrative provisions can and should be pushed out, for example, Unique Health Plan Identifier, Health Plan Certification.  The value of standards and operating rules would be enhanced if the industry developed a timelier and more predictable maintenance cycle.  Future predictable cycles would also facilitate the coordination and communication that will be essential to keep standards and operating rules consistent with one another as we move forward.

Given the number of mandates with implementation dates in the next few years, we continue to encourage CMS to consult the National Committee on Vital and Health Statistics to develop a strategic road map for administrative simplification provision implementations.  This road map should balance all mandates from the ACA, not just administrative simplification provisions, along with the other ARRA/HITECH mandates, to work towards avoiding bottlenecks and overlapping resource commitments.  We would also again request that the NCVHS work with industry stakeholders in developing such a road map.

We appreciate the opportunity to testify and I would be happy to answer any questions.

DR. SUAREZ:  Thank you, Gail.  I think we have next Melissa.

MS. MOOREHEAD:  This is Melissa Moorehead, testifying on behalf of the National Medicaid EDI Health Care Operating Standards Sub-workgroup also the Michigan Public Health Institute.

All I need to do I think is echo some of the themes that we have already heard that generally the time is very ripe for adopting a standard for claims attachments and generally partially because of the reactive and cautious nature of Medicaid information technology implementations that I discussed earlier.  There has been a great deal of paralysis around trying to move forward with enhancing processes that might need an electronic claims attachment because of the awareness that a standard would be coming and not knowing all of the different nuances that that would take.

The other thing that I would just like to react to is the idea of this timeline, which sounds terrific in terms of trying to get a sense of all the different initiatives and mandates that are out there that would affect Medicaid IT systems.  However, I would note that there is no system in place and not a lot of data in place to gauge the length of time necessary for Medicaid as a general thing or individual states or maybe even individual systems to implement electronic transaction standards.  It is a little difficult to know how we would go about putting all of those into a timeline without having the necessary baseline information.

One of the things that occurs to me as a possible recommendation would be adopting these standards for attachments like electronic attachments, that would act as a floor for health plans or for Medicaid to start developing the functionality around those without necessarily simultaneously adopting operating rules or other mandated deadlines, which slow down and stultify the innovation process involved with that.

There are a few more details in my written testimony, but otherwise I think the other testifiers have been doing a great job.  Thank you.

DR. SUAREZ:  Thank you.  Next is WEDI.

MR. DAY:  I apologize. I failed to mention that HL7 did provide answers to all the questions.  I might have another packet there.

DR. SUAREZ:  We did receive that.

MR. DAY: Great. I am Durwin Day from the Health Care Service Corporation.  On behalf of WEDI, I would like to thank you for allowing us to present to you today.

You have been hearing that implementing attachments can be challenging.  Some of those challenges of course, as we mentioned earlier, it was a collaborative project between two SDOs to really bridge that administrative and clinical information gap.

It introduces new standards for payers actually.  The HL7 clinical document architecture is new to payers.  LOINC codes are new to payers, and other transport methods are due to payers as well.  It is going to be a challenge for them to implement this.

It is also going to be a challenge for the providers and their work flow and pulling the information from an EHR over to their billing system or to their practice management system.

It is going to be a challenge for the alternatives that we have for requesting the information whether it is solicited or unsolicited.  The types of responses that you could have whether it is structured or unstructured and different transport methods that can be used.

WEDI plans to conduct tutorials, webinars, and conferences.  As a matter of fact in the next conference coming up is WEDI CON in May of 2016.  We already some of the sessions already planned out around attachments.  One of them was one of your callers that came in today.  Bob Hoffman talked about it from the VA.  He will be there to fill us in on what they are doing with attachments.

The other thing is we are going to have a Think Tank as well.  We are inviting people from industry to different stakeholders as well.  And NCVHS and CMS of course are invited to participate with us.  We look forward to seeing you there.

Education is a key part to implementing attachments.  WEDI recommends that HHS aggressively educate the industry on the value of adopting the standards and the operating rules including attachments and how best to implement them.

We really feel that it is going to take an effort very similar to the one that CMS did outreach on ICD-10.  WEDI is ready to partner with HHS to establish the ROI, to develop educational content, and support outreach efforts.

Attachments.  It is not just for claims anymore.  It is not your grandfather’s Buick.  You have heard the progression of what has changed over the years since ’97.  It is not just for claims.  It is there to support prior authorizations, referrals, notifications, post-adjudicated claims and so on.

You heard from Rob’s testimony as well that these same attachment documents, same clinical documents can be used to help report on the information exchange within an alternate payment model as well.  WEDI has established an alternate payment model work group to focus on the clinical data exchange.

Why adopt?  It is a win-win from providers and from payers as well.  There are benefits and there are some concerns.  Benefits from the provider’s perspective.  It is going to give them faster payments, faster approvals.  It is going to enable them to efficiently route the documents without getting them lost in the mail.  It will allow them specific requests defined as to what needs to be additional information for a specific purpose.  It is going to decrease administrative costs.  From the payer’s perspective, it is going to be a cost savings from automating that request.  No longer sending a letter through the mail again.  The cost savings from receiving the information back electronically and routing it appropriately so that they can adjudicate the claim quickly.  And streamlining the whole review process and adjudication process.  It is also going to give the payers easier access not just to the claims side of this, but to the clinical data as well for other purposes.

It is not without some of the concerns or issues.  It could be the provider is going to have to automate.  The link between the EHR system and the PMS system as well.  It could be changes to their workflow.  You heard some of the issues brought up earlier by George as well about being able to not chaining the request for payers to say not ask one question at a time to prolong the process, but ask them all at once.

And the same thing on the payer side too.  They do not want to receive just a bunch of attachments with every claim that comes in as well.  They want it to be for a certain purpose.  But it is a win-win even in the simplest form of using unstructured data attachments.

For consideration, we believe that we support X12’s definition of their standards for attachments as well as HL7’s definition of attachments and OINC codes as well.

Also for consideration, in the future for innovation of attachments, it is an ongoing process.  We would like to see that the envelope or transport be left open.  You could require the use of the 275, but allow for other methods.  That would be ideal.

Also, be flexible in the adoption.  It could be a phase-in approach.  That phase-in approach could be to first of all adopt unstructured documents first and then structured documents being a head with the narrative text, as mentioned earlier, or getting eventually to the structured documents with the codified elements.

All in all the idea is to keep the alignment with any methods of exchanging clinical information whether it for care management or attachments.

The responses to all the questions are in the written testimony for WEDI.  Thank you.

DR. SUAREZ:  Thank you.  Sherry.

MS. WILSON:  Good afternoon again.  Members of the Subcommittee, I am Sherry Wilson, President of the Cooperative Exchange, representing the National Clearinghouse Association and the Executive Vice President and Chief Compliance Officer of Jopari Solutions.  I would like to thank you for the opportunity to present testimony today on behalf of the Cooperative Exchange membership concerning attachment standards.

For the sake of time, we will move past the overview.  We did present that this morning.  We would like to go right to the recommendations for standards.  I think you will see that a lot of our recommendations mirror what you have already heard today.  For attachment standards, for clinical documentation, we recommend the HL7 Consolidated Clinical Document Architect, the CDR, 2.1, the HL7 attachment supplemental specification exchange for implementation guide Release 1.

We also do recommend the use of the HL7 clinical documents for payers set 1 to be optional.  However, we believe that this transaction is applicable to the business between entities.  The standards should be used; otherwise, this transaction should not be mandated.  We also highly support the use of the LOINC codes, specifically the subset of the HIPAA panel.

In terms of administrative standards, we support the X12 277 health care request for additional information.  Also, the X12 275, additional information to support a health care claim or encounter as a minimum requirement.  In addition, we also support the X12 275 additional information to support a health care claim service review as a minimal requirement.

We believe the regulations must be flexible in order to accommodate existing and emerging technologies.  However, we do hear from our provider colleagues the need for a minimum standard.

We also believe the transport methodology needs to be flexible.  However, we recommend an EDI as a minimum standard requirement.

We also highly support, as we testified this morning, the use of the acknowledgement reference model, the ARM, the X12.  We also believe the regulations similar to what has already been testified today.  The regulations need to be flexible in the adoption again a phased and approach to implementation requirements beginning with the structured and then to move to specific structured documents.

What we wanted to share with you and we have asked for just a minute or so extra.  Our recommendations are based only on our clearinghouse membership consensus, but also further findings from a February clearinghouse attachment survey in which 56 percent of our members participated in.  We would like to just share with your briefly those comments.

First of all from the clearinghouse perspective, the infrastructure EDI is already built.  From our survey, we learned that the Cooperative Exchange members are processing 49 million electronic attachments annually through voluntary implementation and adoption, being driven by an ever-growing industry business need for attachment workflow automation.

We strongly believe by expanding the set of minimal electronic standards for administrative health care data exchange to include attachments and support of claims, post-adjudication, referrals, notification and prior authorization, we can complete the full and end-to-end process integration, which have been the promise of administrative simplification from the onset.

Let’s take a look at the clearinghouse results.  How are those 49 million electronic attachments being processes?  First, we wanted to know how are attachments being processed by health care lines of business?  This survey showed that 55 percent, not surprisingly, are property and casualty, followed with 15 percent of dental, commercial, and government.

We would like to the committee to note that the government and commercial make up 30 percent of those 49 million attachments.  For many of those, 14.7 million attachments, the X12 275 transaction is in full production mode and working very well to meet the business process requirements.

We also wanted to look at attachment utilization by business process.  Not surprisingly, we found 83 percent of attachments associated with the claims adjudication process, as already testified today, high percentage of unsolicited attachment utilization, followed with 11 percent post-adjudication for appeals and audit, and drops down again to 3 percent with referral and prior authorization.

We also were interested in the format type of these 49 million attachments processing annually.  Ninety-five percent we found are unstructured documents with 5 percent as structured.

Also, we wanted to know what are the transport methodologies of these attachments?  And not surprisingly, the highest percentage is the web portal at 53 percent, followed by 27 percent of EDI using the X12 275 transaction, followed in by of course the larger provider as using 14 percent of EDI as the transport mode and then dropping quickly thereafter.

We also were very interested in the utilization of report type identification codes and why that is important.  We have an opportunity to – it is not about automating electronic attachments.  We have an opportunity to really look at leveraging how we use those attachments and being able to expedite routing to the right people in the timely place.

With that, we found that LOINC codes are not widely used at this time and that the X12 837 report type codes are the most commonly used to identify attachment types.  However, we want to point out the LOINCs may not be common; however, it is the missing LOINC in the chain that is critical supporting full attachment automation.  By adopting the LOINC supplemental HIPAA panel code set as part of a phase and approach, we believe it will provide the minimum necessary standards for attachment processing.

In terms very quickly of lessons learned, we do provide this in our written testimony.  But I would just like to quickly highlight that obviously we are seeing a growing application of the X12 277 request for additional documentation.  This helps facilitate automated workflow and definitely drives increased efficiency.  As already stated by several panel members today, there is a significant value in the use of unsolicited attachments where front end edits rules are applied up front.

In Appendix A of our written testimony, we provided a five-year ROI study with attachments.  And one of the comments from that study showed upfront payer attachments rules increased provider’s first time claims pass rate of 75 percent for those claims requiring attachment.  Again, that 80/20 rule.  This process can be automated.

Also, for the provider community, claim submission with attachments reduces the burdens of re-work.  And first time claims submission, as already stated by our panel members, provides faster payment.

Unstructured documents, as we know, are the most common types of transactions.  Very quickly, the importance again of the identification of document type is critical to really be able to leverage the use of this attachment processing.

In conclusion, we would like to say there is a need of ongoing education.  We support the recommendations today to improve workflow automation, processes that will enhance clinical and administrative outcomes across all stakeholders.  There has been a demonstrated business need to automate attachments, processing proven through voluntary implementation and adoption.

We believe defining attachment standards is the most critical area of need regarding administrative simplification.  It represents the primary intersection point where the administrative and clinical data streams converge.  It is a point where payers and providers are more challenged to integrate their business processes.

It is also the single shortest path to seeing hard ROI of tons of millions of dollars across all stakeholders that are engaged in the health care information technology effort.

Lastly, we believe health care is a process community.  In order to effectively automate and integrate patient-centered processes across enterprise boundaries, we must agree on the rules of engagement.  Attachment standards represent the most critical engagement rule.  However elusive and challenging this journey has been for the last 20 years, we highly recommend the time has come where we need minimal standards for regulation to begin to save billions of dollars.  We feel that this can wait no longer to be addressed.

Thank you very much for the opportunity to testify.

DR. SUAREZ:  Thank you.  Don.

MR. ST. JACQUES:  Good afternoon.  Thank you.  I am Don St. Jacques and I am senior vice president of Business Development and Client Services for Jopari.  On behalf of Jopari, we certainly appreciate the opportunity to present to you this afternoon our testimony on our experience of working with attachments.

For those of you who do not know who Jopari Solutions is, we come from the dreaded property and casualty world also known as workers compensation.  With that, we spend a significant amount of time investing in building a very vast network of activity between medical providers and payers.  As of late though, that expertise now has led us into working with a growing number of commercial payers.

To give you an idea of some of the background about Jopari, right now we are handling about three million attachments a month between a very large network of practice management systems, direct providers and payers of all shapes and sizes.

We are also very actively engaged in this type of standards development organization and certainly a great supporter of NCVHS.  We have spent a tremendous amount of time making sure that our traditional industry also toes the line and we are continuing to be another one off.

A couple of things that is important of how this evolved, what drove this very sizable growth in the property and casualty world.  First off, most of this is because each state controls their own destiny.  That that, there have been a number of different rules put out that mandates medical providers and payers to communicate electronically.  But because there is a high reliance on documentation, that was a necessity.  We had to be able to find creative ways to be able to bring those solutions.

There is also the fact that back in 2007 it was really that the motivating factor was the fact that there was such a cost being incurred by providers and payers to communicate that it was causing tremendous amounts of issues with accounts receivable.

In 2008, the industry took the bull by the horns, property and casualty industry, and created what was effectively a companion guide that was a recommendation of how to for providers and payers to work together.  Since then that has been evolving ever since – the International Association of Industrial Accident Boards and Commissions has continued to bring that forward, keeping up with the most current standards.

There is also one of the other things that is very important to understand is that these concepts have been embraced by a number of very key practice management systems, clearinghouses, and other technology suppliers, some of whom are here today.  There is a general interest right now by that industry to be able to assist at this, but again everyone is looking for direction.

If we go to really what are in those rules, there are a couple of key things.  One, there are front end edits.  There are specific requirements in various jurisdictions for certain types of procedures that certain types of documentation have to be supplied.  There are very specific rules, operating rules about missing documentation.  What happens?  How long do you have to be able to get it in?  There are also some very specific requirements as it relates to acknowledgments.  Much of the foundation of what we talked about today has already begun to be late.

There is also a fact that when we look at what is happening in that industry that we are much like as Sherri shared with you just a moment ago.  We are looking at 95 percent of this is unsolicited documentation.  It is coming from providers because they know that that payer probably is going to require them to do something.  With that, they have built up that expertise.  There is only about 5 percent of this right now is in the solicited world.  Ninety-eight percent of what is coming across right now is unstructured.  It is in PDFs and TIFFs, a little bit of clinical right now, a little bit of structured documents, but it is again heavily weighted towards unstructured.

Last but not least in the transportation envelope, only about 10 percent of it right now is being moved by 275.  The majority is being going through flexible transport methodologies, which is bringing the majority of those transactions to payers.

What have we learned?  There have been some pretty significant learnings that we think are obviously extensible to regardless of the claims handling type of organization.  First off the fact that there have been tremendous improvements in claim cycles.  Providers and payers are saying things such as they are faster payment.  Providers are seeing in some cases where their AR used to be 60 days is now eight to ten days because of the fact that documentation is being transported with that claim.

The fact also that because there is no longer this friction between providers and payers that in fact we are actually perceiving that there is improved care for the patient by the fact that again the claim adjustor can make those decisions even on a more timely basis.

Directly from the payer’s mouths, some are seeing as much as 15 to 30 percent of administrative savings even though they may not be at an extremely high percentage of penetration yet for electronic claims and attachments.  Providers, again, are seeing things like 75 percent of the time they getting first time in where they are used to seeing 20 and 30 percent of the time that the claim was accepted by the payer.

Last but not least, we are also seeing from the provider’s side they are seeing defined results in their office where is not taking as much time for them to get claims out the door or having to resubmit multiple times.

We, like the rest of the panel, certainly support the recommendations that it needs to be a flexible approach.  It needs to have the ability to both embrace clinical data, using the HL7 components as well as the administrator standards for X12.  But again we have to emphasis that those flexible transport methodologies because right now the majority of what is coming across between providers and payers is in fact being utilized as flexible means.  Certainly, we do not want to see the fact that a lot of the investments already made is lost.  But there also needs to be as we found a tremendous amount of industry knowledge and education because, again, that has been one of the things that have really driven this to the level it is.

In conclusion, we currently are faced in the property and casualty world that we are still having jurisdictions out there continuing to promulgate regulations.  Certainly overall the ability to have a guidance on standards and otherwise would really be helpful.  But we do believe that there needs to be one EDI workflow, one system, one workflow for all lines with business.  With that, we also encourage you to look at these EDI transactions for attachments because it is really critical not only for the all the overall world payer/provider relationship, but also we need to have it end-to-end.  This cannot be done in isolation.  It has to be an end-to-end cycle.

DR. SUAREZ:  Thank you.  Dave.

MR. NICHOLSON:  Mr. Chairman and members of the Standards Subcommittee, again, my name is Dave Nicholson.  I am here representing my colleagues in the Healthcare Billing and Management Association.

Some of you I am sure will recall that just ten years ago, the tenth anniversary, the issuance of the CMS notice of proposed rulemaking that would have set the claims attachment standards.  Unfortunately, that proposed regulation was never finalized and died three years later due to inattention.

Sadly, that was 2005, and today we come again to plead for an attachment standard that should have been adopted ten years ago.  An attachment standard is critically important and much needed.  In my company, we specialize in radiology, ER, and pathology billing.  A day does not go by that we are not mailing or faxing information requested by an insurer or health plan that could have easily been submitted as an electronic claims attachment.

Most of these responses are submitted via fax as this provides us with a record of submissions and is less expensive than sending the requested information via certified mail.

However, we are finding that insurers are increasingly requesting clinical documentation to support the claim.  We think that with the advent of ICD-10, request for clinical documentation will only increase.  This may be particularly true as payment models evolve to a bundled payment or episodes of care that will be linked to the patient’s primary diagnosis.

Based upon our experience with different payers, we know that if a payer is going to request additional information from the insurer, we will automatically prepare the claim as a paper claim and submit it with the attachment to try to expedite the processing of the payer.  Think of the added cost of building the claim, mailing the claim, and the delayed revenue because the claim was submitted on paper rather than electronic.

This outdated and cumbersome process is completely counter to the entire concept of administrative simplification and leads us to ask the simple question of why.  Why has it taken us 20 years to come up with the standards for claim submission?  More specifically during that 20 years, we have gone from medical images being taken on film that had to be read in a hospital to digital images that can be taken in Baltimore and read instantaneously by a radiologist in California.  Yet if I wanted to transmit that image as part of a medical claim that was submitted electronically from Maryland to a health plan in California, suddenly the electronic transmission process comes to a screeching halt.  We move from Star Trek and Dr. McCoy to Eliot Ness and the Untouchables.  It makes no sense.

As I noted, in the absence of electronic claims attachment standards, we have had to develop a variety of workarounds including health plan portals, secure emails and the use of standard 1500 paper claim transactions.  Each one is different.

There must be a single set of standards and adherence to these standards should be mandatory for all health plans and providers seeking to electronically exchange clinical content.  Having multiple sets of standards, as some have suggested in the past, would be counterproductive and completely contrary to the intent of HIPAA.

On behalf of HBMA and our member companies, we appreciate this opportunity to testify.  Thank you.

DR. SUAREZ:  Thank you.  Jean, you are next.

MS. NARCISI:  Thank you.  I have my ADA hat on today.  I want to thank you for inviting the American Dental Association to testify on issues related to electronic attachments.

Again, I am Jean Narcisi, director of Dental Informatics at the ADA.  The ADA is the world’s oldest and largest dental professional association with over 158,000-member dentists.  As a longstanding member of the standards development community, the ADA appreciates the opportunity to provide comments.  The ADA is named as a consultant to the secretary in HIPAA and is the only professional association so named.  In addition, the ADA is an American National Standards Institute Accredited Standards Developer.  The ADA has been a leader in informatics standards development since 1992 when a task group of the ANSI Accredited Standards Committee MD 156 was created to initiate the development of technical reports, guidelines and standards on information technologies used in dental practice.

The ASC MD156 Task Group later evolved into the ADA Standards Committee on Dental Informatics, SCDI.  Under the ADA’s ANSI accreditation, the ADA SCDI is the consensus body that currently reviews and approves dental informatics American National Standards and technical reports.  The ADA SCDI developed standards and technical reports promote patient care and oral health through the application of information technology and other software and hardware products to dentistry’s clinical and administrative operations.  The standards are developed, debated, edited, validated by an all-volunteer SCDI Working Groups.  The Working Groups address specific topics and provide an opportunity for all stakeholders to participate while ensuring a balance of interested parties have their say in the development of voluntary consensus standards.

The ADA SCDI also works in cooperation in other standards development organizations including X12, HL7, DICOM, IHE, and ASTM.  In 2009, the ADA SCDI entered into an Associate Charter Agreement with HL7 that recognized the ADA’s role in leading the development of dental content for inclusion in future HL7 standards.

This ongoing cooperation between the ADA and HL7 is now expressed as a Statement of Understanding dated June 15, 2015, which specifies that development of the dental content of standards resets with the ADA, while HL7 provides the technical elements of the standard.  The ADA will continue to work with HL7 to prepare dental content for the with HL7’s electronic attachment transactions.

With regard to an attachment content standard, we urge the Subcommittee to recommend adoption of the HL7 Consolidated Clinical Document Architecture Release 2, the CCDA R2 templates only as these are already in use in many health care provider facilities and are supported by certified electronic health records used by dental practice participating in CMS meaningful use programs.

We do not believe that the HL7 clinical document payers, CDP templates, will help achieve administrative simplification, but instead create burdens for health care providers and their technology vendors who must support two standards instead of one and in many cases with already insufficient resources.

In addition, providers will be further burdened by being required to manage payer’s different requirements for attachments.  The secretary should adopt only one standard for attachment content if this is to be avoided.

As part of its ongoing work in dental informatics standards, the ADA SCDI just finished work on a new dental attachment standard, ADA Standard Number 1079 Standard Content of Electronic Attachments for Electronic Dental Claims.  The content in this new standard work product is intended to be normative for dental attachments for the foreseeable future.  ADA Standard Number 1079 obtained official recognition as an ANSI standard in December of 2015.  The ADA Standard Number 1079 is enclosed with the written comments and it covers periodontal charting and orthodontic attachments.

In conclusion, we strongly recommend that the new ANSI approved ADA Standard 1079 content integrated with the HL7 CCD Release 2 templates attachment standard along with the use of the X12 275 transaction as the vehicle for transportation be adopted by the secretary at the earliest possible opportunity.

Thank you for the opportunity to present information relative to dentistry’s position on electronic attachments.  Thank you.

Agenda Item:  Subcommittee Q&A

DR. SUAREZ:  Thank you everyone for this wonderful review.  It is clear I think throughout testimony that not only we are ready, but we must move forward.  We cannot wait anymore for adopting this.  I know there are probably a number of questions.  Let’s just go through the questions.

Let me start with the phone and see if Ob and Alix or any other person on the phone has any questions.

MR. SOONTHORNSIMA:  Walter, thank you.  Thank you everybody.  Considering everyone’s consensus that we need to move forward with attachments, what do you think is a realistic timeframe for adoption and implementation of the standards and how might this timeframe be aligned or not aligned with the next major change such as HIPAA 7030?

DR. DAY:  This is Durwin.  That was a question I believe that you asked.  Our response to that was that we believe that there needs to be at least a year of time especially in a payer’s perspective to do some analysis and planning to get that done first and then implement it, given the fact that the 7030 transactions are being reviewed this year.  By the end of the year, they plan to have those going through all the informational forms and everything to get ready for publication.  That would probably put the regulation out another six months from there at least to a year.  You need at least two to three years.  I agree with Dan as well those two to three years because it is a new standard.  It is a new LOINC code.  It has other methods of transport that could be optional.

DR. SUAREZ:  And just to define it if I may.  There is a question of – part of it is the timeframe from let’s say when the final rule gets adopted.  How long the industry needs in order to move from the final rule is adopted to compliance with the standard?  I have been hearing from one to three years.  Maybe that is part of the question.

MS. BARBER:  Can I address from the X12 730 perspective?  At the meeting at the end of January at our winter standing meeting, I did roll out what our public comment period was going to be, which I know you deleted that picture from your phone.

DR. SUAREZ:  I did.

MS. BARBER:  I am not sure if some other people did, but I know Walter he did.  He showed me.  The guides to support attachments, which will be the 275 guides, the 277CA and the 824.  The 278 7030 version is in a different cycle, but we do have those as being in our last set of guides for development and public comment.  They would not be going out for public comment until the latter part of this year.  November 1 is when they are slated for it.

We feel that the 6020 guides are adoptable and that is what our recommendation is.  It is for the 6020 guides on the adoption.  As I had mentioned earlier, that also includes adopting the 6020 278, which would be for prior authorization complete regardless if an attachment is needed or not.  We stand by the 6020 versions and feel that they are good for adoption.

MS. DARST:  Walter, I want to add based on our experience.  I kind of touched on this.  Honestly, the 275 component was the easy part.  We were able to replicate that fairly easy.  It really comes down to the administrative simplification EDI people whether it is in the payer side of the house or the providers do not have the expertise to do that HL7 component.  The education is critical.  We almost need a year of education to really have everyone understand it.  I think there is a perception that providers do this stuff all the time.  There really is a distinction of who is doing the programming.  There is a clinical side and there is an administrative side.

I think there is a huge learning curve.  We generally allow two years of implementation.  We are going to need more because the education is going to be critical.

DR. SUAREZ:  Thank you.  We have Gail.

MS. KOCHER:  While I would say we have not discussed this in detail with plans, I think at a minimum because we are talking brand new standards.  Two years is necessary.  I am assuming that most stakeholders will be okay with three.  I think though we have to consider – we have seen historically we say too it takes us three.  I think to Laurie’s point, I think education and all of that is we really have to prepare for that ahead of time.  But that clinical piece is going to be very new to a lot of stakeholders.  While some of the plans are already doing clinical data exchange with their provider trading partners, we have a lot in the industry that have not even begun to look at that.  I think there are multiple pieces that are going to have to be thought through and considered as you look out what is a realistic implementation time, but setting the expectation that we do not turn into another 4010 and 5010 where it is everybody – or ICD-10 where everybody thinks it is just going to get pushed back.  It is somehow balancing all of that through education, timing, communication, et cetera.

MS. WILSON:  I would just say from the clearinghouse perspective, we have been fairly successful in obviously attachment and electronic workflow today.  We have implemented the 6020 on the 275.  Again, the current version is being used.  But we also from a clearinghouse perspective, we think it is really important the regulations again are flexible to accommodate for the existing and emerging regulations.  We look at attachments.  And today as clearinghouses, part of our business process is normalizing data and being able to meet the different needs of stakeholders based on their EDI level of readiness.  Today, we have stakeholders that may not be able to do a 275, but the clearinghouses are able to provide.  Take that TIFF and PDF and be able to wrap that and be able to put it into 275.  We also have payers that cannot accept a 275.

Part of it is our ability to normalize that data, unwrap it to be able to put it in a proprietary or format they can use.  The same thing with structured documentation.  We are beginning to see more utilization of that.  And, again, part of our role is to be able to take that structured data and to be able to put it in a readable format and to be able to do those exchanges of attachments.  It can be done today.

I think the most important message is our ability as an industry to leverage our existing IT investments of the stakeholders and to be able to look at resources as again we look at EDI readiness to keep it flexible and adoptable.

MR. TENNANT:  It seems to me that we are falling back into the same trap of waiting.  We are going to wait for the rule.  Then we will start the education.  Then we will have a two-year implementation period.  We are looking at ten years or more.

I think we can probably jump start the process with the education.  That will do a couple of things.  One, it is will drum up some interest among providers.  When you talk to providers, they really do not believe this is ever going to happen.  It is one of these Jules Verne things.  We need to build some interest.  If you build interest on the provider side, two things will happen.  That will put some market pressure on the vendors to support it because vendors always say we are not hearing from our customers.  Why should we build it when we are not hearing about demand?

The other thing is a political one.  We need to put some pressure, frankly, on the next administration to get a rule out.  It is not going to come out.  It is not going to be finalized under this administration.  But we need to collectively go as an industry to say we have identified the standards.  We can be here talking about these standards for another ten years.  We need to go there and push them a little bit harder.  I would push back on folks to say let’s just sit back and wait for CMS to dictate this.  We, as an industry, need to be proactive.

DR. SUAREZ:  Susie and then Rich.

MS. BURKE-BEBEE:  I have two questions.  One piggy backs on what we are already saying and it targets some statistics that you have.  I was really surprised about the numbers, the 4 billion claims and also the 49 million attachments.  When I look at your last five slides, I see that 27 percent of those attachments, the methodology is the EDI and the 275.  I am assuming that that is not the suite of the attachment that is being recommended here, the other things besides the 275.  But at 27 percent, I am wondering – that number is a significant number.  And some of you were talking about one year, two years, three years to get to the attachment.  Do you see that evolution with those that are already doing the EDI?

MS. WILSON:  It is growing.  I cannot stress enough.  There is a business need.  The fact that this industry has developed without regulations the need to automate workflow for attachments voluntarily with implementation is a huge statement.  I, too, was surprised by the way of the use of the 275, but we are using it.  Even in the unsolicited attachments, the 275 is being used to transport attachments.  We are seeing a growing demand.  And the reason is not because it is mandated, but because it makes good business sense.  There is good ROI to automate it.

We talked to our provider colleagues here.  The ability to send an electronic attachment, be able to know what the rules are upfront, and to know immediately what the use of that acknowledgement, immediately, did the payer get it or not versus waiting 45 days to learn.  I am sorry.  We have not paid your bill because we need an attachment to support payment.  The value proposition across all stakeholders with the growing attachment is being adopted by reasons of it makes good business sense.  There is clear ROI, again, not because it is mandated.

MS. BURKE-BEBEE:  I heard the number of $21 thrown around.  I am wondering what that would go down to per attachment, not that we know that right now, but it sounds like it is significant.

MS. WILSON:  Again, I was just going to say that the fastest ROI – we may not save trillions of dollars with attachments, but just by minimal standards, we can save billions of dollars in health care today versus waiting years.

MS. BURKE-BEBEE:  I wonder if that 49 million out of 4 billion claims would in fact go up.  Exponentially, the savings would increase as you are using more attachments for other reasons.

MS. WILSON:  Thank you for bringing that point up.  Absolutely.  I think our example today is we wanted to bring low-hanging fruit.  This is just, again, voluntary.  As Rob said, by putting the minimal standards, some people are waiting on the sidelines, especially the vendors, the practice management systems going we are not going to do anything until we know there are some minimal regulations.  Just by moving forward with just minimal can make a significant impact in the cost of health care and saving money.

MS. BURKE-BEBEE:  To piggy back onto that in the same vein, there are 53 percent of your survey results that are using web portals.  What do you see the life expectancy of web portals as opposed to an attachment with the suite of standards that is being proposed?

MS. WILSON:  I think there are several answers.  Great question, by the way, on regarding that.  I think the reason we are recommending from the clearinghouse a minimum requirement of EDI.  As we move to EDI as common across as a transport methodology to do attachment, everyone pretty much can do that part of it.  The web portal – why we see 53 percent.  There are different business needs in how applications are being used.  For some providers, again, it is based on EDI readiness from low tech to high tech.  For those providers that are low tech or medium, being able to upload on their desk top an attachment, using the web portal, has significant value.  It allows them to take a benefit of just like a big provider with EDI application so it serves a functionality.  There is going to always be I think some web portal application as we have with EDI.

But, again, what is very exciting is part of that adoption from the small guy to the large guy whether it is a portal upload.  They can now have the ability to leverage the advantage ROI of an attachment processing versus paper.  I think we will see both, but again that is why we highly recommend flexibility being able to accommodate existing and emerging technologies based on stakeholder EDI readiness.

DR. BURKE-BEBEE:  Thanks.  My one last question has to do to with something, Laurie, that you talked about in your pilot.  The technology piece looked to be not insurmountable that you succeeded in achieving that transaction.  The question that I wondered if you have wrestled with because you talked about unsolicited was the challenge was unsolicited versus minimum necessary.  When we are talking about clinical data that is moving, how do you balance that?

MS. DARST:  Our pilot was very narrowly focused.  If we were talking about clinical notes and the whole medical record, I think it would be a whole different issue with the operative report in this situation because they needed the information to be able to process the surgical charge.  It was not an issue of minimum necessary because that is all we sent them.  I think some of my colleagues have touched on it.  If we are asked a question to send “medical records”, what does that mean?  Then it becomes an interpretation problem.  But in our pilot, it was not.

DR. SUAREZ:  This is a great point actually because we are going to have a national committee one of the responsibilities we are doing this year is advising OCR, the Office for Civil Rights, on minimum necessary guidance.  I think there is a need to retake that concept, rethink it in the context of all the things that are happening now with EHRs and mobile devices.  You can think of all the different things that are happening now with different methodologies.

NCVHS is going to be holding a hearing.  I do not have the dates in front of me.

PARTICIPANT:  June 16.  May 24 and 25.

DR. SUAREZ:  On June 16, we are going to have a hearing on that specific topic, minimum necessary, and it will include elements about thinking of administrative transactions including attachments particularly.  When we were thinking about this within the Privacy and Security Subcommittee that was a point that I threw out.  I think it is interesting on understanding how minimum necessary applies to this new particular new particular transaction attachment.  Great questions.

MS. GOSS:  This question actually goes back to a comment that Stacey made about 6020 guides, also looking at the commentary from the clearinghouses on the use of versions 6020 off the 275.  It sounds like some folks are supportive of wanting to move ahead with 6020 even though the industry is currently using version 5010.  I am wondering from a provider perspective what perceptions do they have of going to a 6020 version where it looks like the next version that will get recommended will be 7030.

MS. BARBER:  I do not think you are looking for an answer from me, are you, Alix?  You are wanting input from providers on how they feel about that.

MS. GOSS:  You are tracking with me correctly, Stacey.  I am looking at Heather and George and Rob and Laurie.  What does it really mean for the scope of products the providers are using today and they are 5010 based, not 6020.  Are we going to create an additional burden or dynamic?

MS. BURCKHARDT:  Alix, this is Laurie Burckhardt with WPS Health Solutions.  I am just going to speak from a payer that implemented with Mayo.  We implemented with Mayo.  We were in 4010 for claims transactions.  We implemented 4050 in the 275.  And then when we moved to 5010 for the claims transaction so the claims were coming in 5010, but we were still in the 4050 version.  I think as Laurie had testified with NGS, they are using the 5010 837, but they are in the 6020 275.  To me, that is a good show that it really does not matter.  The version does not have to tie, be a one-to-one relationship.

MS. GOSS:  But my question is also what do you need in your translator tools and what does it mean to the products that may have to have the different underpinning version of the X12 standards to enable the TR3 you are specifying.

MS. BURCKHARDT:  We just wrote in our contract to make sure you can do all versions.

MS. GOSS:  That is why I am asking the provider-based question, Laurie, because I know there are costs there.

MS. DARST:  This is Laurie Darst.  We did not have any problems with having mixed versions, kind of what Laurie Burckhardt is referring to.  But, again, as Rob pointed out, we have the technology being a larger provider.  This was not a problem for us.  I do not know if it would be an issue for other providers or not.

MS. GOSS:  Rob, do you have any sense?

MR. TENNANT:  Just real quick.  Really it is not an issue for providers as much as the vendors.  Can the vendors support the later versions and if it is going to add incredible cost?  Obviously, providers are going to push back on it.  I do not think the technology is the problem.

MS. BARBER:  I was just going to say.  One of the things that we talked about in June when we were specifically talking about transactions is improvements to the transactions.  Under the pilot and the testing that was done under 5010, we did identify some improvements to the 275 and those are in the 6020 version.  I think it is important that the 6020 is compatible upward and downward versioning.  I do not think that we need to necessarily say that all transactions have to be in the same version at the same time.

MS. WILSON:  To that point, one other reason especially for us as – looking at the 6020, it is conversation up or down.  Based on providers doing 5010, you can still augment it and use it versus 6020.  But what is really important to the industry is in Minnesota, there are regulations that go into effect, July 2016, which has mandated the 275 and the most current version is the 6020.  In preparation, these regulations went into effect last year with effective date as July 2016.  That is one of the reasons being prudent and helping our stakeholders that we have implemented with the 6020.

MR. LANDEN:  Mr. St. Jacques, just to be clear, the 36 million annual worker’s comp attachment transactions.  Those were not included in the 49 million of the Cooperative Exchange?

MR. ST. JACQUES:  Those were included in the 49.

PARTICIPANT:  Represented the 55 percent.

MR. LANDEN:  Thank you.  Laurie, you had made a comment about wanting the EHR developers to get involved with the HL7 administrative attachment development.  Could you talk to me a little bit?  What is the thinking there?  What is missing now that you are aware of that you think they might add?

MS. DARST:  A couple of things.  One, we do not see them at the attachments workgroup.  That is a concern.  As Sherry just alluded, Minnesota has now mandated that we do work comp within a specific version of the 275 and then it is silent on the HL7 component of it.  We are trying to get a handle on that.

I know that my colleagues have been working with their large EHR vendors.  The EHR vendors are asking them where do we get the HL7 information to try to accommodate what Minnesota is requiring.  Again, they are large vendors.  It tells us that they do not have that information.

I think there is also a bit of – the feedback that I have heard is EHR vendors and we have touched on this or practice management systems until there is a rule.  It is a moving process and they are hesitant to create something.

DR. SUAREZ:  Thank you.  Other questions from the phone?  Any other questions here?

MS. MTUI:  This is from Mary from the VA.  Just a note, as a government entity, the VA, we will need to have time to request funds for EDI projects.  Per Bob Hoffman, the VA on the payer side is currently working towards implementing attachments and authorizations.  However, we are working on the 5010 versioning.

DR. SUAREZ:  Thank you.  An important point.  I was going to ask actually to Melissa if she is still on the call about Medicaid and the Medicaid agencies and their level of readiness to handle HL7 type transactions.  Melissa, are you still on the phone?

MS. MOOREHEAD:  Yes, I am.  Sorry that I glossed over my testimony so much because I do have a little bit about that in there. Generally because the way the systems have developed, we do see that practice management systems are the ones that specifically have the connections to Medicaid management information systems in the claims processing of most of those are administrative transactions.  I would say that generally there is not good readiness for that in the Medicaid arena.

There are Medicaid agencies that have been utilizing the various tools at their disposal to try to incorporate more EHR data in different kinds of analytic projects and the Medicaid enterprise overall.  But generally, even in those cases, I would not say that there has been much of a project yet to figure out how to incorporate clinical data into the mechanized claims processing and retrieval systems without there having been a standard in place.  As I said, some states have done analyses and have some ideas about plans they might like to make, but have not moved forward due to waiting for those standards.

DR. SUAREZ:  Thanks for that.  Indeed, I think that is one of the big considerations.  I know it is an issue and a point for all health plans really and even perhaps clearinghouses to handle HL7 type transactions.

I do have one question or point or comment perhaps.  I would like to hear your perspectives.  Generally, what we have heard is the consistency.  Conceptually, a lot of points have been made about a glide path or a process by which we can start with something they can structure standards.

Conceptually, if we have the ability to say, for example, that if you are to submit electronic attachments.  The first thing is are you submitting attachments.  Yes.  Are you submitting electronic attachments?  This is really the provider who is determining or deciding that.  Are you submitting electronic attachments?  Yes.  Then the next question becomes are you submitting unstructured data or do you intend to submit unstructured data.  If the answer is yes, then you must use the standard being adopted.  In this case, it would be recommended.

Are you submitting structured data?  If the answer is yes because they have the capability of submitting structured data, then the next point is really you must use the standard.

In other words, build it in a way that we build the glide path from the start and not say we start adopting an unstructured transaction and then two years later adopt the next one and then two years later adopt the next one, but rather say through the right wording and the right approach, allow the flexibility to if you are sending this type of attachment content, structure and unstructured, then you must use this type of standard.  How would that work in your mind?  Would it be an appropriate way for us to handle that?

MR. TENNANT:  Absolutely.  That is exactly the type of flexibility we are looking for.  When I think about ICD-10 and the prohibition that CMS put on trading partners exchanging ICD-10 data prior to the October 1 deadline, the opposite should be true.  If you have folks that are ready, let them go.  We can learn as we go.  The faster we do it, the more flexibility, the better.

DR. SUAREZ:  Great. Any other reactions?

MS. MCCOMAS:  This is Heather.  I agree with that, but I think I would caution, would all of those options be available from all health plans for all providers?  My current concern is health plan A says we are offering this note.  Would all health plans have to offer all those opportunities because that is the issue?  The health plans might not like that.  They have to build everything for all the possible abilities on the universe. That is my concern.  Then you get into one health plan does it one way, one does it another, and providers have to do it different ways across different health plans.

DR. SUAREZ:  Exactly.  There would be some need to consider that because maybe a health plan is only ready to receive unstructured data at the beginning.  The health plan will have the ability also to say – this is still evolving of course conceptually, but the health plans can say if you are sending electronic, send us only unstructured because we cannot handle yet the structured.  And the provider will be able to – even if they are able to send a structured, they can still do the unstructured of that content.  That is perhaps one way.  Think about it.  It is building that flexibility on both ends.

MR. TENNANT:  Except the opposite cannot be true.  I think what Heather is saying is you cannot have a health plan saying we will only take structured.

DR. SUAREZ:  Absolutely.  Great point.  That is definitely a point.

MR. ARGES:  That was my concern. I would hope that health plans should be able to accept both the structured and the unstructured.  A lot depends on the information because there might be some instances where something is represented as a value and you can structure it and plop it in as a structured piece of information, but they may say that very same piece of information that I need the invoice for that.  I want to see the actual invoice.  That is a PDF.  That is an image.  You may be providing it as a PDF.

DR. SUAREZ:  Exactly.  It is sort of like the baseline would be like unstructured because a lot of documents are still probably going to be and continue to be unstructured type documents.  I will give you another example.  When we were in a conference call with Medicaid and Lisa can attest to this too, certainly in the Medicaid world, there are a lot of administrative documents like consent, a signed consent from the patient.  That is a document. 

Maybe in the future, we will have an electronic standard for that.  Right now, we have a piece of paper that can be a PDF that can be sent out and structured.  The unstructured would be a baseline.  It would be a baseline – the intent that I see is not to be required.  In other words, you must send unstructured.  If you are sending and you are intending to send electronic and you are intending to send an unstructured data then you must use the standard.  That kind of a buildup.  That is the kind of way I am beginning to think about this.

Again, this is just purely a discussion to give the committee and the Subcommittee some ideas about the approach that can be based on your testimony about appropriate flexibility and transitional approach.

MR. DAY:  That ties into your question too, about the scope or length of implementation.  If you say that you need to be able to do unstructured within a year that may be a doable timeframe.  But the structure would be two to three years down the road.  It could be for a certain document.  HL7 is taking their CDA documents and putting it into fire and they are doing it by the most popular attachment types.  They are taking CCD and summary and doing it first.

DR. SUAREZ:  There is yet even another technology coming.

MR. DAY:  By the way, there is a link code for consent forms.

MS. WILSON:  I would like to say, Walter, I really like the direction you are talking about looking.  We have really felt in our recommendations.  We really listened carefully to Rob with MGMA and with how they are with the AMA and with George with the American Hospital Association, clearly articulated to us on that.  We are concerned that payers would dictate one way.  That is why we looked at our recommendation from the clearinghouse perspective.  Have a minimal standard.  If we have the minimal, a 275, and then again if there are others that – keeping it flexible to allow, but a minimal.  Looking at the transport methodology, a minimal of EDI.  Then I think that helps meet some of your concerns and requirements to move forward, being able to slowly begin that migration towards that direction.

DR. SUAREZ:  Thank you for that.

MS. WEIKER:  Margaret Weiker with NCPDP.  Based on experience from moving from a prescription pad that the doctor would write, hand you a piece of paper.  You would take it, go to the pharmacy or not go to the pharmacy.  Some people did not get it filled.  To an electronic prescription.  One caution is you must define what you mean by electronic.  That will be very critical when you start talking about attachments and electronic attachments.

Many in the early years of ePrescribing thought if I fax the prescription, that is electronic.  You are not carrying it.  You may print it.  Some systems automatically brought that fax image into their system.  Fax is not electronic.  Uploading a PDF to a web site really is not electronic as defined under ePrescribing.

DR. SUAREZ:  That uploading of the PDF is not.

MS. WEIKER:  It is not.  I think it is very important when you start talking about electronic attachments that we define and what you mean by electronic.

MS. GOSS:  Margaret, is that sort of analogous to some of the DDE conversations we had back when we were implementing 4010?

MS. WEIKER:  Yes, it is Alix.  It would be.  Direct data entry in 4010. Yes, it would be.

DR. SUAREZ:  Let me open up for any public comments.  Anyone from the public whether here or online that wants to make any statements?

Seeing none, let me just say and I know Ob and Alix would want to close this so I will turn it to them.  On behalf of the National Committee, this has been an amazing session.  I know whenever we put together hearings and we put out questions, I personally can attest to the amount of work that many of you, all of you took in preparing very thoughtfully and thoroughly these questions and these answers.  It is incredible the reflection of all of your perspectives and the people that you represent.  We are so appreciative to that.

But I am going to turn it to Ob and Alix to close our day today.

MS. GOSS:  I appreciate everybody’s flexibility and support.  This is really important to move along with Phase IV and attachments topics and you have clarity about where we are going next.  I know for myself having worked on some of the early days of attachments, I would really like to see us finally deliver.  I am looking forward to see the community’s discussions over the next day or so and also factor in the necessary work as we solidify our 2016 work plan for the Standards Subcommittee and the Review Committee.

MR. SOONTHORNSIMA:  I just want to echo the comments, but especially I want to thank the staff for being flexible and arranging for a very difficult day.  We pulled through this.  I especially want to thank Terry Deutsch as always for pulling off another successful –


MR. SOONTHORNSIMA:  I know it is late and everybody wants to get out of here.  The word of Ferris Bueller.  You all go home.

DR. SUAREZ:  Thank you so much.

(Whereupon, at 6:26 p.m., the meeting adjourned.)