[This Transcript is Unedited]
NATIONAL COMMITTEE ON VITAL AND HEALTH STATISTICS (NCVHS)
SUBCOMMITTEE ON STANDARDS
Hearing on HIPAA and ACA Administrative Simplification
Operating Rules, ICD-10, Health Plan ID, Attachments
June 10, 2014
Hubert H. Humphrey Building
200 Independence Ave., SW
Washington, D.C. 20024
TABLE OF CONTENTS
- Session 1: Regulatory Update, DSMO Report and Operating Rules
- Session 2: Use of Credit Cards—Including Virtual Cards—For Claims Payment
- Session 3: Coordination of Benefits
- Session 4: Health Care Attachments Transaction Standard
- Session 5: Use of UDI in Administrative Transactions
- Session 6: Health Plan ID
- Session 7: ICD-10 Delay
- Public Comment
P R O C E E D I N G S (9:00 a.m.)
DR. SUAREZ: Good morning everyone. My name is Walter Suarez. I’m the
co-chair of the National Committee on Vital and Health Statistics Standards
Subcommittee and a member of the subcommittee. On behalf of the subcommittee
and the full committee members I want to welcome you all to this one-day
hearing of the subcommittee on various topics regarding standards. We have a
very busy agenda, and we’re going to be moving through it expeditiously.
We appreciate everyone’s willingness to really stick to the five minute rule
of the testimony. We have a new technology here. We have a clock that will give
a little signal to the testifiers when they have one more minute to go. If that
doesn’t work, then we’ll just let you know.
I’m not sure if Ob is on the line yet, or we’re going to be connecting
people online as well. We have probably a number of people joining us online
and through the phone, so we’ll go around and start our very quick
introductions first with the table and the members of the subcommittee and
committee, and then we’ll go around the entire audience to have you all
introduce yourselves. I believe this is being recorded, as all of our events
are. We will be making some additional introductory remarks as we finish all
the introductions. Again, my name is Walter Suarez. I’m a member of the
committee and co-chair of the Standards Subcommittee, and I don’t have any
(Intro around table)
DR. SUAREZ: Before we go to the rest, I want to see if we have any of the
members of the committee or the subcommittee on the phone right now? We are
connected to the phone line, right? Is there anyone— all right, we’ll come
back to anyone on the phone. Let’s go around the table first.
DR. SUAREZ: Do we have anybody on the phone now? Anyone on the phone?
MS. HYLAND: Yes, Mary Hyland, Cooperative Exchange.
DR. SUAREZ: Thank you. Anyone else? Okay, well, it’s very exciting to come
to this day. I think a lot of people need to be first of all acknowledged and
thanked for putting this very extensive and somewhat complicated hearing
together, the seven topics in seven hours hearing is what we call it,
basically. I want to really acknowledge all of you, first of all, our
testifiers for taking the time to come and share your perspectives and your
expertise and knowledge in these various topics. Certainly our staff and
Terry’s very able and incredible capabilities to handle so many, what were
almost 40 testifiers plus all the various other functions and responsibilities,
so thank you so much Terry for helping us coordinate this.
As you all see in the agenda, we are going to be dealing with various
topics, all of them very important and significant in not just into the future
but in today’s world. We appreciate again everyone’s willingness to share your
perspectives and to really leave time doing each of the sessions for a really
good discussion with the committee. We are going to have, as always, time at
the end of the day for public comments and we’re going to invite any one from
the public and anyone else around to contribute and to participate in this
regarding any of the topics that we’re going to cover today.
Some of the activities that the National Committee has always undertaken is
this particular hearing in June. Pretty much every year now in June we hold a
hearing in which we invite testimony regarding the status of implementation of
the various standards, code sets, identifiers, operating rules, and other HIPAA
related activities. This has become a very important day for NCVHS, for our
subcommittee every year. This year it’s especially important given the
significant number of important issues that we’re going to be addressing.
After this we expect an intent to prepare as always a letter or perhaps a
number of communications and letters identifying some of the themes we heard
today, discussing those, and then reviewing and preparing some recommendations
for the secretary regarding each of these topics. We’re also going to be
acknowledging, and we do now acknowledge many testimonies that we received in
preparation for this hearing from many different groups in several of the
topics and we invite people to continue basically and to submit any testimony
and any commentaries that we move forward in preparing our observations and
The subcommittee expects to be meeting between now and September, our next
full committee hearing, probably at least once a month if not a little more
frequently to of course go through the testimony and invite probably some other
groups to provide us their perspectives as we again move into preparing themes
and observations and recommendations to the secretary. With that, I know Ob is
not yet with us. He had some travel issues last night, and so he’s going to be
able to join us later today. We hope he’ll be able to make it from New Orleans.
I’m hoping that he perhaps while he’s underground can join us by phone if that
is possible and he can do it. In the meantime, I think we’re going to move
ahead certainly and begin our hearing now.
Let me see if there’s any opening points or comments regarding this by our
chair or any of our members of the subcommittee at this point, any comments
that people want to make at this point. Ready to go? Okay. So we’re going to
start with our first sessions, a regulatory update, a DSMO report, and an
update on the operating rules. We are going to start with Todd from OESS.
MR. LAWSON: Thank you. Good morning everybody. I’m glad to be here this
morning to participate in the NCVHS meeting. As Walter said my name is Todd
Lawson. I’m currently the acting director of the Office of E-Health Standards
and Services within CMS. I have just a few remarks and updates, and I’ll try to
keep it to my five minutes. Smack me upside the head if I go over.
HHS remains committed to our continuing efforts to achieve administrative
simplification across the healthcare environment. We certainly recognize the
vital role that NCVHS plays in this advisory role under HIPAA, and we’re
working closely with this committee and the industry to achieve all towards
greater uniformity and transmission of health information for hopefully
improved interoperability, efficiency, and enabling providers and payers to
process financial and admin transactions faster and hopefully at a lower cost
than the paper manual process. Overall we believe the usage of the
administrative simplification can contribute very greatly towards overall
efficiencies and administrative cost savings, and also facilitate bridging the
clinical healthcare data with admin healthcare data.
Today I’d like to share a brief update on topics including attachments,
HPID, ICD-10, and EHR incentive programs. Before I do that, I’d like to extend
a big thank you for providing comments to our CMS certification and compliance
regulation. We’re working— our staffs are working diligently through those
comments with an expected final rule later this year.
In the area of attachments, CMS believes that the attachment mandate
outlined in the Affordable Care Act provides an opportunity to build on
existing infrastructure in both clinical and administrative areas of of
healthcare, through standards and operating rules, while allowing for future
innovation. CMS engaged in many of the ongoing standards and development in
operating rules discussions so we could gain a better understanding of the
current state of the industry as well as the technology surrounding clinical
We do believe there’s some significant work yet to be done in all the
standards areas related to clinical attachments. At this time we do not feel
that the attachments standards, such as messaging operating rules or clinical
document standards, are quite ready for adoption as national standards for
clinical attachments in the support of health claims adjudication for payers.
However, we will continue to work with NCVHS and industry to achieve consensus
on a national standard and utilize processes established by NCVHS as well as
the HHS regulatory processing at the appropriate time as we consider the
adoption of attachment standards.
In the area of HPID, we’ve expanded our outreach and education efforts to
help health plans and other stakeholders think through key concepts for HPID
enumeration. We’ve posted a number of webinars, developed frequently asked
questions and blogs, and we’ll continue to do that and offer industry support.
More information on resources that we have out on our website related to HPID
can be found at the CMS website, which is the www.cms.gov website. You click on a link under
administrative simplification and find the information there as well.
In the area of ICD-10, as I’m sure all folks are aware, on April 1 of this
year the Protecting Access to Medicare Act of 2014 was enacted, which stated
the secretary may not adopt ICD-10 prior to October 1, 2015. HHS expects to
release an interim final rule in the near future that will allow— include
actually a new compliant state that would require the use of ICD-10 beginning
October 1, 2015. The rule also would require HIPAA covered entities to continue
to use ICD-9 through September 30, 2015.
HHS and CMS will continue to collaborate with providers and industry and
stakeholders to offer transition support the best we can for the new compliance
state. You’ll hear more about that and some next steps for our implementation
in the Medicare fee-for-service testing update during a panel session later
today I believe.
In the area of EHR incentive programs, on May 23, 2014 a permanent rule that
would provide eligible providers, eligible hospitals, and critical access
hospitals more flexibility in how they use their Certified Electronic Health
Record Technology, CEHRT, to meet Meaningful Use, to Proposed Rule from CMS and
the Office of the National Coordinator would let providers the 2011 edition of
CEHRT or a combination of 2011 and 2014, for the electronic health record
reporting period, and 2014 for both Medicare and Medicaid electronic record
Beginning in 2015, all eligible providers and professionals would still be
required to report using the 2014 edition. The proposed rule also includes a
provision that would formalize CMS and ONCs previously stated intention, which
is to extend stage two through 2016 and begin stage three in 2017. The comment
period for that rule closes on July 21 of this year.
In addition, CMS Proposed Rule on stage three of Meaningful Use for EHRs
incentive programs is currently under development. Publication of that is
expected sometime in the fall of this year, 2014.
That concludes my remarks. Again, I’d like to thank the committee for having
the opportunity to join you here today. CMS looks forward to hearing the NCVHS’
recommendations and industry’s perspectives on a number of topics here today.
Thank you very much. I can turn it over to Walter or the next speaker.
DR. SUAREZ: Thank you. Welcome aboard. Basically, from our perspective, it’s
really great to continue our partnership with CMS, certainly, in all the work
that we’re doing. I think Margaret?
MS. WEIKER: Good morning. The Designated Standards
Maintenance Organizations, DSMO, thanks the National Committee on Vital and
Health Statistics for the opportunity to present our 2013 annual report on our
work to address the changes, challenges, and opportunities effecting the Health
Insurance Portability and Accountability Act administrative transaction
standards. As you are aware, the DSMO is comprised of six organizations. The
three standards development organizations are ASCX 12, HL-7 International, and
The three data content committees are the American Dental Association’s
Dental Content Committee, the National Uniformed Billing Committee, and the
National Uniform Claim Committee. The DSMO steering committee is made up of two
representatives from each of the six organizations, as well as representatives
from the Centers for Medicare and Medicaid Services, Office of E-Health
Standards and Services.
Collectively, the DSMO reviews change requests to the current HIPAA
designated standards and for new standards and code sets to be adopted. A
change request can be submitted by anyone by completing the change request form
found on the HIPAA DSMO website. Each DSMO organization can opt in to review
the change request and discuss the merits of the request within their
organization. Each DSMO organization has 90 days to review the change request
with the option to request a 45-day extension if additional time is needed.
Once the DSMO organizations complete their review, the DSMO steering
committee meets to discuss the review and final disposition from each DSMO
organization. The DSMO steering committee identifies the final DMSO response
for each change request, which is then published on the DSMO website. For the
period January 2013 through December 2013 there were four change requests
submitted. All were reviewed by the DSMO. Two requests were approved as
maintenance to the existing standard and to follow the applicable SDO process.
The other two approved requests were recommendations for adoption of
new/modified HIPAA standards.
Change request 1189, which was the electronic prior authorization by
prescribers for the pharmacy benefit has been presented and deliberated by this
subcommittee on February 19. Change request 1186, which is an XML standard for
the ASCX 12 healthcare related transactions has not yet been discussed by this
subcommittee. Therefore, the DSMO request the subcommittee discussed and made a
recommendation to name the ASCX12 TR3 schema as the XML equivalent of the ASCX
12 HIPAA mandated transactions. The attached report, and I’ve electronically
submitted it, and I hope you all have that, provides details of each change
request and its disposition.
Since the previous report, the DSMO has continued to follow the work of
NCVHS, standards development organizations, data content committees and
operates rules offering entity as the work relates to the provisions of
administrative simplification. On September 10, 2013, the DSMO sent a letter to
the Secretary of HHS recommending NCVHS serve as the review committee as
required under the patent protection and Affordable Care Act of 2010.
The DSMO looks forward to continuing to work with NCVHS on our joint
interest for administrative simplification efforts. One of the questions that
was posed for this panel was the status of the transaction standard updates.
From an NCPDP perspective, they have begun discussion of what is the trigger to
move forward to the next version to be adopted under HIPAA. No decision has
been made at this point in time though change requests continue to come in to
NCPDP for changes to the telecommunications standard.
In regard to ASCX 12 and N, and their standards, the change process is going
along fairly smoothly. We anticipate having draft guides available at the end
of the 2015. That might possibly move to 2016, but right now the target is late
2015 for having some draft guides available.
One item that I think needs to be discussed and agreed upon, is testing for
the transactions. I believe it’s been stated that before the next round of
standards are adopted for HIPAA they must be tested first. From the SDO
perspectives, we need to know what that really means. What do you mean by
testing? Who’s responsible for testing? Who’s responsible for — are there
are funds available, grants, et cetera, getting those— if it’s the DSMO’s
responsibility to test these before they’re brought forward, we need to know
sooner rather than later because we’d have to see if we can’t get some vendors
to do that for us.
I think that’s one thing that needs to be addressed fairly soon in regard to
what do we mean by testing and how’s it going to work going forward. That
concludes my comments.
DR. SUAREZ: Thank you very much Margaret.
MS. BUENNING: Hi everybody. I am Denise Buenning. I’m the Director of CORE.
CAQH CORE would like to thank the Standards Subcommittee for the opportunity to
update everyone on the progress we have made with regard to the development and
maintenance of the operating rules as mandated by the Affordable Care Act.
This morning I’ll quickly review the purpose of CAQH CORE’s work, discuss
our work plan for development of operating rules for the remaining HIPAA
administrative transactions and share some examples of specific opportunities
and priorities with regard to many of those remaining transactions.
Just quickly CAQH CORE from the beginning in 2005, it’s evolved into a
140-plus member multi-stakeholder organization. Last year the CAQH core
chartered task force, which is a subcommittee of the board revised its mission,
vision, and about statements to ensure we had some added focus on the alignment
of administrative and clinical activities among providers, payers, and
consumers. We updated the vision to include us as an industry-wide facilitator
of a trusted, simple, and sustainable healthcare data exchange that evolves
with market needs.
We currently have more than 140 multi-stakeholder entities with
multi-stakeholder board. Right now we have nearly 150 entities that have
obtained certifications, those being a mix of health plans, clearing houses,
providers, and vendors.
With regard to the third set of mandated operating rules as I think we all
know, CAQH CORE was designated as the authoring entity by the secretary for the
remainder of the HIPAA transactions, and we’re already at work developing the
third set of operating rules. These include claims, including coordination of
benefits, prior authorization and referral certification, enrollment and
dis-enrollment of in a health plan, premium payment and attachments for which a
standard has yet to be adopted. CAQH CORE operating rules have proven
themselves to achieve positive ROI to evolve with industry needs, to account
for key scenarios and to support incremental maintenance as they continue in
The approach that we use with regard to operating rule development includes
identification of options that dress business needs, industry research, and
polling, work at the sub group level, workgroup review, and of course full CORE
vote. WE anticipate that we will have a draft of the operating rules for this
third set that will be delivered to NCVHS by the end of 2014.
Our infrastructure— rather our operating rules include both
infrastructure and content. Infrastructure applies to all the operating rules.
It involves— actually it was ranked as the highest opportunity by many of
the entities that are working on this. We also address content, obviously, for
agility and for improvement. We have to address ongoing maintenance of the
content, which can be very resource intensive. We’ve learned a number of
lessons that we need to— we want formally recognized, an acknowledgement
transaction, and standard for that. We have to consider experience and other
market areas, for example the fact that the health insurance exchanges are
using a subset of the sub-standards, meaningful use, the EHR inclusion of HL-7
We also need to understand that staff needs to have much more training and
education regarding the technologies and the standards. WE also have really
understood that prior authorization is very much connected to attachments. If
you really think about it, prior authorization is in regard a pre-service
attachment, and of course attachments area post service attachments. Those are
very much linked together and we’re starting to see a lot of similarities
across those two transactions.
This is a schematic of the work plan for the third set of the operating
rules. As you can see, some of the steps we have already completed. We are
currently dealing with step six. We’re looking— we’ve obviously gone
through our market and business analysis. We’ve identified opportunities with
regard to what things we need to focus on within the operating rules, and from
those we develop real options which then eventually become rule requirements.
As you can see it’s a very logical and strategic approach that we take to this.
This is what we do for all of the operating rule development.
In terms of our infrastructure operating rules, they’re obviously based on a
detailed environmental scan and the subgroup has identified some high priority
opportunity areas as we’ve just discussed. For example, an opportunity might be
the goal of improving connectivity, and the option within that goal might be to
converge on an envelope standard, to increase interoperability, plug and play
capabilities in line with clinical arenas. Another opportunity might be to
improve message interaction.
A selected option might be batch required, real time optional for three of
the four transactions regardless of connectivity method used. Prior
authorization is still under debate because that one is a little bit more
complex, and the subgroup is holding on a few key areas given again that the
attachment standard has yet to be determined. One of those holding patterns is
a consideration of direct for attachments.
Claims and prior authorization, we’re seeing that the electronic adoption
rates based on 2013 research estimate 3.2 billion claims and, of course, claim
submission by electronic means has good adoption, 91 percent. Small provider
offices are having, of course, the most challenges. Compare that to the pick-up
rate for prior authorization of 15 percent. There are infrastructure issues
beyond connectivity and processing modes.
Of course, system availability, downtime reporting, and companion guide
flow/format is also a concern. Content is focused on improving error reporting,
and there’s some discussion around a trace number that would connect to a claim
attachment so that it could be matched up.
Acknowledgement is again a critical piece of making improvements. The CAQH
CORE board has approached X12 leadership in its role as a CORE board advisor to
jointly discuss with CMS the possible inclusion of acknowledgments in operating
rules. We’re continuing to have discussions about that. Then of course,
coordination of benefits, we’ve identified several opportunities, among them
being help plan electronic acceptance of all COB related claims. We’re going to
be hearing more about that from CAQH this afternoon, so I won’t go into anymore
detail on that.
Enrollment and dis-enrollment in a health plan and
premium payment, in order to have a more informed operating rule CAQH sponsored
an exchange study after the first year enrollment period was over to get some
real world experience on the federal, private, and state exchange use of the
X12 834 and the X12 820. The study findings, which we’re just putting together,
indicate that there is widespread use of XML among vendors, use of requirements
in both CMS-developed companion guides and of course the X12 v5010 guide,
variance between employer versus insurance exchange usage, infrastructure
issues, and of course content issues.
With regard to our ongoing research, again in 2013 we conducted a market
assessment to identify business needs, data content, and format requirements,
technical infrastructure, and priorities for claims attachments, and other
additional information. We did this again to better inform our development of
the operating rules. We determined that CAQH CORE may have some value moving
forward in helping to educate and conduct outreach on the HL7 standard,
drafting operating rules, focusing on industry neutral standards such as pdf or
waiting until standards are issued to begin work.
The methodology that we used in 2013 was to gather information in national
forums, public surveys, secondary data analysis, and interviews with over 35
stakeholders. Then in 2014 we conducted follow up listening sessions in both
April and May with over 300 participants to continue that dialogue. The primary
focus again was to recognize attachments broadly as any additional information
supplied upon a request but to focus on administrative versus clinical
We’re continuing to analyze that information, and we will share it as soon
as we have it. Here’s some preliminary feedback that we’ve gotten. Attachments,
examples of market assessment polling results, as you can see the vast majority
of attachments are transmitted by a paper, whether it be a fax, US mail, e-fax
document. There is some recognition that the standards do exist and have some
use, X12 and HL7 messaging with structured data, the formats used for these
electronic documents are overwhelmingly industry neutral, pdfs, jpegs, tiffs,
and even Word. Obviously health plans directly access claims attachment
information from a variety of sources, including health information exchange, a
provider’s electronic health record, and other databases.
On the operating rule development for attachments, there are opportunities
for initial operating rules. We are looking at an incremental flexible roadmap
approach as the NCVHS spoke to in 2013 to move first from a paper to electronic
documents, limited sets of industry neutral electronic document formats to
quickly accelerate improvement, for example a jpeg file, and using a trace
number or the tracing mechanism to match those up. We have asked for HHS’ legal
opinion to whether they would be open to recognizing industry-neutral standards
in operating rules as an interim step. We firmly believe and support the NCVHS
in its contention that making the leap from a very heavily paper environment to
a total electronic environment probably needs to have some kind of an interim
step in order for it to be successful.
We also again need to help educate the industry on anticipated healthcare
standards for attachments and of course with a focus on HL7. We think there are
opportunities for operating rules. Once the healthcare attachment standard is
adopted, which includes use of LOINC attachment type codes, business rules for
using direct data entry or other sources, or potential ways to reduce the
number of attachments. I know I’ve gone a little bit over, but I welcome any
questions and observations you might have.
DR. SUAREZ: Thank you. Okay, I think we’re ready for some questions for the
MS. KLOSS: Denise, could you comment on what form or format the results of
the research that you’ve done on attachments will be available, disseminated,
when and how, and what you’re going to do with it?
MS. BUENNING: We literally just got results maybe 24 to 48 hours ago. We’re
looking through them. We’re combining that with the information that we had
from 2013. We’re going to obviously put that in some kind of a summary that we
will make available to the members of the subcommittee, and then they can
determine how and when they’d like to disseminate it further. We’ll probably
also post it to our CAQH CORE website.
MS. GOSS: Margaret, you noted the testing dynamic, and this has been a long
standing conversation topic in the world of HIPAA adoption. I thank you for
bringing up that issue and suspect that there’s lots of discussion going on
without any clear direction. At one point I remember OESS doing a pilot to look
at the testing process, what might work, and I feel like we need to link these
two conversations. Really, my question is not for you, Margaret, it is for Todd
and Matthew in regards to the results from that testing effort and what kind of
conversations are being convened with the DSMO leaders, and based upon that,
that experience and the results of that testing pilot.
MR. ALBRIGHT: We have got in the audience the lead of the testing pilot if
you want to hear about the conclusions from the pilot. Is that what you’re
MS. GOSS: I think I’m more philosophically interested in the leadership role
that you’re going to play in trying to bring this issue to conclusion, because
having been a part of 4010 and 5010 development, this is an underpinning
problem. We should never role out standards under a promulgated rule that have
not been road tested so we can apply lessons learned. Those people in standards
communities are awesome. They work really hard, but there’s nothing like the
devil in the details being revealed through a pilot. How can we help the
industry get a better standard?
MR. ALBRIGHT: I definitely think that the pilot was good as a pilot. I think
there are lessons learned from the pilot. It’s certainly, from what we saw in
the conclusions, we certainly saw the need for testing before the next version
is implemented. As to the term leadership, we might want to take a step back
from assuming that role and make it more of an industry conversation. Clearly,
resources are scarce everywhere. The DSMO can agree with that. In terms of who
would take the leadership and how we would proceed with a broader, more
systemic kind of testing before a version of standards is implemented, I think
it’s a great conversation that needs to happen. How’s that?
MS. GOSS: It sounds, quite frankly, like we’re kicking the can down the road
and know that we can’t do that too much longer if we’re really going to have
the standards coming out of X12 and NCPDP for the next round. Margaret, you
didn’t even say what version might be considered— 70-something,
MS. WEIKER: It will be 7020 or higher. We haven’t finalized it.
MS. GOSS: So interesting, 7020 for 2017. I think that’s something the
committee can talk about and maybe give you some suggestions on.
DR. GREEN: I have a question for both Todd and Denise. Could both of you
just comment further about the blending or coordination or connection of
clinical and administrative data? Todd, you made a quick comment about that.
Denise, in the attachments discussion you emphasized the need for attachments,
not clinical. What’s the deal there?
MR. LAWSON: My understanding of what we’re talking about on the clinical
side has to deal with a lot of the quality measure information that our Center
for Clinical Standards and CMS deals with. To the extent there are some touch
points between the two, we can leverage that. That’s kind of where I was going
with the comment.
MS. BUENNING: I think there is no question that especially with the prior
authorization as well as attachments you’re seeing a blending of both clinical
and administrative information. I think that even in CAQH CORE’s vision
statement we talk about the better alignment of those two sides of healthcare.
That’s just in general across all operating rules, but I think with the
attachment standard still to be adopted and then the operating rules that would
support that, I think that there’s an opportunity to really take another look
at how those better align, not just for that singular attachment transaction
but across all of the transactions.
I think this is a theme that we hear continuously, not only at this
subcommittee but at other industry meetings as well. How do we get, for
example, from the electronic health record that has clinical information, match
it up with administrative information, and produce ultimately a claim that can
get adjudicated and then paid? That’s the vision that I think we all have, but
it’s a matter of what steps do we need to take and where are the intersecting
points, as Todd had mentioned, and how do we move towards that in a very
logical way? I think that involves not only a discussion among ourselves but
also includes a discussion with the vendors.
DR. GREEN: So going forward, do we have agreement across the industry and
the regulators about whether quality measures are clinical measures or
MS. BUENNING: I think that quality measures are obviously clinical in
nature, but I think again that they impact the administrative side of
healthcare. I think maybe if you want to view them as a hybrid in a sense, you
could possibly do that.
DR. GREEN: So we are going to go forward assuming that as attachments start
to work and we move into them being electronic rather than by fax, et cetera,
that we can assume that the data necessary for quality measures will be being
developed in these attachments?
MS. BUENNING: I don‘t know if that is an
assumption, but I think that’s certainly something we have to look at. I think
again the mindset now is starting to shift a little bit. We have to integrate
that into everything that we do, and I think attachments might be the lynchpin
that perhaps raises that issue up to both industry as well as to government.
MS. KLOSS: Just a follow up question on attachments, so we’ll have the
results of your industry assessment, and I think that’s terrific, and we have
agreement that the standards aren’t there yet. What will the process be for
designing that roadmap to get there? Is that something that this committee
might roll up our sleeves and help some with, or is there a mechanism?
MS. BUENNING: Speaking for CAQH CORE, I think we obviously welcome all
input, especially from the subcommittee with that regard. We do have a process
for the development of the operating rules, as we discussed, but I think that
in terms of ramping up some of the outlined elements perhaps, if you want to
call them that, we would certainly welcome roadmap input or direction—
MS. KLOSS: Not just the operating rules, right, it’s the underlying
MS. BUENNING: It is the underlying— when we say that the standard isn’t
there yet, I think it’s a matter of a standard hasn’t been adopted yet. I can’t
speak to the status of standard development. But it certainly has to be adopted
DR. SUAREZ: We are actually going to have a session on healthcare
attachments later this morning. We’ll hear more about the status of the
MS. WEIKER: I just want to make a comment about the attachment piece of
this. In regard to the ACSX 12 transactions that are being considered for the
attachment piece, they’re ready to go.
DR. SUAREZ: Thank you. Maybe just one final question. This one is for
Margaret actually. You mentioned the guidelines coming out later in 2015 or
perhaps early in 2016 for what could be the potential next version for
standards. Could you remind us how— so, in between standards, so right now
we’re in 5010, there is a need for a maintenance of that or some sort of a
adjustment on that version. What is the process for achieving that? Is there a
way to make some of those adjustments while we’re waiting for the next version?
How does that work?
MS. WEIKER: Yes, there is a way to do that. Whoever would want to do that
would need to file a change request, and that is available from the ASCX 12
website on what is your requirement, why must it be done now, can it be
supported in the version using a K3 segment or something, so a lot of detail
around that. An example would be HPID. That was a regulatory change that we
needed to make and fix some things in the guide around language, and that’s
through our Errata process.
Any time somebody would need something and it’s considered critical, there’s
mass, it’s impacting many, then we would go through and evaluate it based upon
our errata process. To say that we would never make changes, no, that’s not
valid. We would, but it’s not a change process for one or two payers, oh I want
to just implement this or I want to just implement that. It’s something that
impacts the major and the masses. It’s going to be a coding change throughout
the entire industry if we do change those guides. It’s something that can’t be
taken lightly as well, and must be delivered very carefully.
MS. GOSS: Margaret, to that point after X 12 or NCPDP might make a change,
is there a regulatory adoption process as well?
MS. WEIKER: Yes, there would be. In regard to the NCPDP right now there is
something on the books where they need to make a change to support some
Medicare Part B requirements. That’s come before this committee. It came
through the DSMO process. We’re waiting for OESS to issue a rule around that
type of change.
DR. SUAREZ: Well, thank you very much. I think we’re ready to move to our
next session. I thank you again for your testimony, very much appreciate it.
We’re going to move to the next session, which is the use of credit cards,
including virtual cards, for claims payment. We invite the testifiers to join
us here at the table. We’re going to start with Matthew. We’re going to go down
the order on the agenda.
MR. ALBRIGHT: Thank you. I’d like Gladys Wheeler to join me. She’s team lead
for the Office of E-Health Standards and Services at OESS, CMS. She’s been
dealing with this topic as well. I’m Matthew Albright. We’ve heard a number of
issues with regard to credit card, use of credit cards for healthcare claim
payments, healthcare payments in general, and the use of a virtual card. We’ve
had a number of discussions with people at this table and in the audience and
appreciated those discussions and the input, AMA, NACHA and other groups. We’ve
come to see that there’s probably three different distinct issues going on. I
know that this panel is just about virtual card payments, but there’s a number
of EFT things that are associated, and we’ll probably hear more from the panel
on some of the other issues.
One is that providers are good at being put, sometimes automatically,
sometimes without an opt-out mechanism, into a virtual card payment process.
This are associated with substantial fees. The second issue that we’ve heard is
that providers are using the EFT standard as it was adopted by CCD-plus, which
goes through the ACH network, but again, vendors are assessing substantial
fees. The third topic that we’ve heard is related to those two, and—
(Technical issues— paused testimony)
MR. ALBRIGHT: One, use of putting providers into virtual card processes;
two, providers are using the standard, the EFT standard, which goes through the
ACH network, but they are being assessed substantial fees. Three, the third
incidence, which is somewhat related to these two is the incentive,
disincentive, incentivizing providers away from using the standard or
dis-incentivizing them by making the standard too difficult or
To back up a little bit, the provisions in the EFT standards rule, the
intent of those provisions has been brought up a number of times that the rule
says that the ACH standard, the CCD-plus, is the standard, but the providers
have a choice actually of using that standard or other EFT electronic payment
functions. The idea there, and this derives from testimony that we heard before
we adopted those standards was to give providers the option to test innovative
ways of payment.
We certainly saw CCD-plus as the most efficient and the least burdensome of
that time, but other kind of standards were introduced, which may have brought
more efficiencies. For example, NACHA has a CTX whereby the payment information
travels with the remittance advice. That would certainly be much more
efficient, however, very few providers had tested that beforehand.
Many providers use Fedwire, at least on occasion, and Fedwire, too, has
worked on a standard where the remittance advice can travel with a payment. Of
course there are virtual cards and payments. Our intent there with that rule
was really to give providers a choice and also to allow for innovative payment
processes, which might push the envelope in terms of efficiencies in getting
paid healthcare payments through EFT.
To get to those three issues that I mentioned at first, I think that our
role in terms of the federal government in terms of dealing with them are
twofold. One is education, and the second is enforcement. Clearly there’s a
need. Clearly providers are being abused, we think, in these instances. There’s
a need for us to educate with industry partners what the rights of the
providers are, and what are the choices they have.
Clearly since the original HIPAA provider has the right to request the use
of the standard transaction, which means that all health plans should have that
EFT standard, that use of the EFT through the ACH network available and ready
to give any provider that asks for it.
Then there are other issues. There are other parts in our rule that talk
about the requirement or prohibition against incentivizing away from a standard
and trying to force or trying to incentivize a provider or trading partner to
use something other than standards. Probably the third part, which is not
necessarily a part of the provisions but certainly is part of our
responsibilities is to remind providers at every opportunity to read the fine
print. Whether they’re using the ACH network or virtual cards or any payment
process that they read the fees assessed and they really get to know what their
choices are and what the implications of those choices are.
The second thing I think in our responsibility was the clients, and many of
you know, Gladys. Gladys has been a part of our HIPAA compliance for many
years. We’re dealing with a number of incidences, which fit these general
categories, following up with them.
I think in terms of compliance, a couple of the things that we’re looking at
is when fees are being assessed how much is really excessive? When do we cross
that line when a fee may be justified and it becomes excessive? And the other
thing that I think is significant is an education for providers. A lot of times
we’re hearing that providers aren’t told about the choices. They’re told that
you have to use the virtual credit card, when in fact there may or may not be
in some cases, the actual adopted standard that’s available for use.
MR. ALBRIGHT: We appreciate it, and we very much appreciate
NCVHS dealing with this issue. I think it needs to be discussed. Thank
DR. SUAREZ: Thanks a lot Matthew. Thank you so much Gladys for that comment.
We are going to go to Heather from AMA.
MS. MCCOMAS: Good morning everyone. I am Heather McComas from the American
Medical Association. Thank you so much for inviting us here today to provide
further input on the topic of virtual credit cards on behalf of our members. I
think that the subcommittee got a fair amount of background information on this
topic in February, so I won’t go over my introductory slide there. I will start
off, however, by highlighting some of the major issues that we raised regarding
the virtual cards and their impact on providers.
First, foremost, last, and always, the major concern with these cards is
their impact on provider income. They significantly erode the contracted fee
amount that physicians are supposed to receive for their services. I was at the
X12 meeting last week, and a provider representative, I think put this in very
relatable terms. She said, imagine if suddenly your employer started paying you
in a way that you lost three to five percent of your salary with each pay
period. You would be upset, I hazard to guess. That’s exactly the situation our
physicians are finding themselves in today. They’re losing up to five percent
of their contracted fee amount to interchange fees on these virtual credit
The credit cards are also associated with significant administrative
burdens. There is manual keying in of the card information, and there is manual
payment posting and payment reconciliation associated with the cards.
Also as Matthew mentioned, there’s a real lack of provider choice associated
with these virtual cards. These programs are almost all exclusively opt-out. In
other words, the provider gets the card, and this is the first time they’ve
heard of it. There’s no choice involved in electing a payment method.
Finally, perhaps the final grain of sand in the wound here, is that health
plans are being incentivized very heavily to use these cards. They’re receiving
1.75 percent cash-back incentives to use the cards. Again, we all enjoy our
credit card rewards programs personally, but when it comes to these programs,
this is at provider expense. We find this very troublesome.
One of the issues that was raised by the subcommittee in February was is
this an outlier problem that just exists in pockets, or is this a real
mainstream issue? From our perspective, from everything that we have seen and
heard from our vantage point, this is a national widespread issue. First of
all, we hear all the time from medical societies that are passing on their
concerns from their member physicians about the virtual credit cards, and these
complaints and questions are increasing over time. I’d say especially over the
last six months or so we’ve heard more and more on this topic.
We did an informal survey of medical society staff a couple of months ago,
and 44 percent of state medical society staff reported receiving greater than
five physician complaints on this topic. 24 percent reported receiving greater
than 10 complaints. Obviously the medical societies are hearing a lot from
their members on this.
We did some further reconnaissance on this topic of physician practices. We
did this within the last month. It was an informal web survey of physician
practices, and 68 percent of respondents reported they had received virtual
credit card payment. These affirmative responses were spread across the
country. It was West Coast, East Coast, South, Midwest. There wasn’t just a
certain region that was effected by these virtual credit cards.
Then I’ll point out two additional important points that we saw in this
survey. First of all, these credit card payments are almost exclusively opt-out
programs. 96 percent of respondents indicated they did not have prior
notification or consent when they were first presented with the credit card.
Then 40 percent of respondents indicated they were unaware of the
interchange fees associated with the credit cards. That’s a pretty big chunk of
physician practices that are not aware of the potential effect on their
incomes. That’s obviously very troublesome to us.
I think it’s very helpful to look at a case study to present you with some
granular data about how these virtual credit cards can effect a physician
practice. These data are from a large North Carolina radiology practice. I have
to express my sincere appreciation to the North Carolina Medical Society for
helping us gather these data. This is year-to-date. It’s not even complete
because they didn’t start gathering data until mid-January. This is year
through the end of May. As you can see, this practice received over 2,000
virtual credit card payments just in 2014 to date. For not even a total of five
months, their fees totaled nearly $10,000. That is a big chunk of change.
Frankly, it’s outrageous, $10,000 of lost income just to this one single
A couple of things I will point out regarding this case study. First of all,
these fees add up quickly. Maybe if you looked at each transaction singularly
it wouldn’t seem like a big deal, but $10,000 in less than five months, that is
a lot of money. Again, this is a single practice, less than five months. That
is the very tip of the iceberg. If you think of all the practices out there
getting these virtual credit cards, this is a huge problem.
This practice’s interchange fees were two percent. This could have been much
worse if they had had a higher percentage fee. That $10,000 could have been
significantly higher. Additionally, just think of the administrative burden of
entering 2,079 credit cards into your credit card machines. That’s a lot of
hassle for the physician practice.
Finally, this practice indicated that there are 48 different vendors sending
their virtual credit cards. They’re trying to get out of these virtual credit
cards. They’re trying to opt-in to EFT, but that’s 48 different companies that
they have to contact. That is a lot of work. They’ve indicated that they’re up
to 16 letters to the companies, but it takes a lot of practice time to combat
this issue. As we all know, that time could be so much better spent in actually
taking care of patients.
Another point I’d like to tag onto what Matthew mentioned, there is this
issue now of providers being charged to use the ACH EFT. This is a real concern
for us. We were so hopeful and optimistic at the beginning of this year when
the EFT operating rules that went into effect that we had a good alternative to
steer our providers to, to opt into using EFT. Now, we’re hearing that
providers are being charged between 1.8 and 1.9 percentage based fees for ACH
EFT. We find this extremely disturbing.
We’ve done some investigation. We find that these fees are being charged by
payment solution vendors for value-added services. The problem is that
physicians are just being told this is the only option, to sign up for this
program that has these value added services with a percentage fee. They’re not
being told there’s a no-cost option available, so they automatically get into
this program that again makes them pay to be paid. We think that’s really
I also want to briefly comment on the state of virtual credit cards and
standard electronic transactions. There have been several requests for
interpretation at ASC X12 on this topic. Both of them stated that a compliant
X12 835 ERA transaction cannot carry all of the information needed to support
credit card payment. There is a change request at X12, 1265, that’s requesting
to add the credit card information to the ERA transaction. That request is
still pending as of after the June 2014 X12 meeting. It’s still under
discussion. The AMA does not support that change request unless there’s
additional protections added for providers, including verbiage that would
indicate these programs should always be opt-in for providers. The issue
choices is just significant.
We would suggest that even if this change request is approved, it’s going to
take some time before this information can actually work its way into the
electronic remittance advice transaction. There’s guide development, pilot
testing, and then finally the regulatory process to get the credit card
information to the next HIPAA mandated version of the 835. It could be at least
six years before this information is actually able to be electronically
submitted in the X12 835 transaction.
There has been some guidance provided on this issue. We are very grateful to
CMS for the FAQ that was issued at the end of March which outlined some of the
points that Matthew made earlier. We would suggest that there could be some
additional guidance and perhaps some stronger guidance presented on this issue.
Particularly there’s some verbiage in there that providers should be charged
excessive fees for using a standard transaction. We certainly agree with that,
but excessive fees could be interpreted different ways by different people, so
we think some more clarity is needed on that particular subject.
Obviously provider education is central to this issue. The AMA takes our
role very seriously in letting physicians know about these issues. We do have a
couple of new resources available on our website about this topic, the first of
which is “The effect of health plan virtual credit card payments on
physician practices”. We also have a new EFT resource titled “Know
your rights and make ACH EFT work for your practice”. That resource gets
into these percentage based fees issues we’re seeing with EFT. Also we’re going
to be doing an educational webinar probably in September that will be live and
archived on our website. All these resources are available on the AMA website
To sum up with some requests and recommendations, we do think some
additional guidance is required on the topic of virtual credit cards, again
addressing the transparency on key issues. The issue of provider choice, again,
we think that opt-in is the way to go for this. We feel that health plans
should not be incentivized at provider expense to use these virtual cards. Then
we feel that the percentage-based fees for ACH EFT are improper, and they’re
really an enforcement issue. You’re taking our only good option away if fees
aren’t EFT as well. Finally, we think that providers should be clearly informed
that there is a no-cost EFT option available to them, and that should be
clearly communicated to them. Thank you so much for your time.
DR. SUAREZ: We are going to move quickly to Doug Downey
MR. DOWNEY: Good morning, and thank you for the opportunity
to share a healthcare provider’s perspective relative to the negative impact of
health plan virtual credit card payments on the health care provider. I
represent the nation’s largest healthcare provider, Hospital Corporation of
America. HCA merchant credit card fees in 2013 increased by an estimated $3
million as a result of the un-negotiated use of VCC payments by health plans
and/or their clearinghouse/aggregator payment service agents.
It’s been quoted by many different sources that anything that happens in the
healthcare industry, HCA represents approximately four to five percent of that
event. If we experienced a $3 million event, you can extrapolate that to a much
larger number when you encompass the entire industry.
HCA is not opposed to the use of virtual credit card payments, as this form
of payment may be appropriate for some providers. HCA is opposed to the
misapplication of the Credit Card Association rules as the basis for the
un-negotiated unilateral opt-in approach used by the health plans and/or their
agents. HCA is also opposed to the concept that providers should pay health
plans to receive a payment, either in the form of credit card interchange fees
or as a direct fee to receive an Affordable Care Act EFT/ERA compliant payment.
Health plans and/or their agents switch payments from check to virtual
credit card with no business discussion between the two parties, unilateral
versus bilateral, effectively automatically enrolling the provider in the
program. Health plans and/or their agents are also incorrectly leveraging the
Credit Card Association rules, which apply to consumer-to-business payments,
and they’re applying those rules to business-to-business payments. We believe
this is a misapplication of the rules.
Once a provider realizes than an automatic opt-in event has occurred, the
health plans and/or their agents have created an onerous process for the
provider to navigate in order to opt-out and revert to receiving payment by
check. In many cases, the provider is challenged just to make contact with the
correct associate within the health plan, or the agent organization, to begin a
dialogue. Once dialogue has been established, the steps that a provider must
take to opt-out have clearly been structured to be as difficult as possible for
the provider to complete. If a provider is successful in completing the opt-out
process, the health plan and/or their agent becomes very aggressive in
attempting to migrate the provider from payment by check to their Affordable
Care Act EFT/ERA compliant payment process. In some cases, a provider is led to
believe that payments may be delayed as a result of reverting to check
Providers are interested in pursuing the Affordable Care Act EFT/ERA payment
dialogue with one caveat. The health plans and/or their agents typically
present a fee schedule associated with receiving the ACA EFT/ERA compliant
payment. Providers believe that this fee schedule is in direct violation of
HIPAA section 45 CFR 162.925 (5). Providers to not pay a fee to a health plan
and/or the agent to receive a check payment, and providers should not pay a fee
to receive the ACA EFT/ERA compliant payment.
If this business practice/methodology continues, it will remain a
significant barrier to achieving the goals of electronification and
administrative simplification as intended by HIPAA and the ACA. Providers can
typically process a check payment at a significantly lower cost than the fees
being proposed by the health plans and/or their agents to receive the ACA
In conclusion, I reaffirm that this provider is not opposed to the use of
Virtual Credit Card payments between health plans and providers. This provider
is opposed to the unilateral approach currently used by health plans and/or
their agents to implement this payment option. This provider is also opposed to
the fact that health plans and/or their agents receive incentive payments
resulting from the use of Virtual Credit Cards. This provider is a strong
supporter and active implementer of the ACA EFT/ERA standard, but we remain
opposed to any fee associated with receiving the payment standard. Thank you
for the opportunity to present this perspective.
DR. SUAREZ: Thank you very much. Priscilla?
MS. HOLLAND: Good morning and thank you. NACHA, the Electronic Payments
Association, is pleased to submit our testimony to the committee on this issue.
A lot of what I have included in my testimony Heather has already covered. I’m
trying to leave the written testimony and modify what I have in the
I’ve been to a number of conferences in the last 18 months and seen an
increased growth in the use and complaint on virtual cards. In the last two
months I’ve had conversations with a couple of providers. Charlie Myers from
Johns Hopkins indicated when I was at the WITI conference in May that in six
ways they’d had 13 vendors that had moved health plans, that had moved from
sending checks to sending the virtual card payment. This was all done without
consent or request on the part of Johns Hopkins. That meant they had to waste
staff time trying to figure out how to opt out.
In talking with Leann DiDomenico from Performance Pediatrics, which is a
micro practice in Massachusetts, they have 90 percent of their payments that
are being sent to them via EFT. That’s the way they’ve been able to have a
micro practice. Her comment was when we interviewed her for a case study was
that when they get the virtual card payment there is no information on those
forms as to who to contact.
For them to be able to opt out of this, they have to again spend staff time
trying to figure out who to contact, how to contact, and waste additional time
that they could be using for other things. Her comment was that even if she
writes them a letter, if there’s a PO Box on the virtual card payment, she
assumes that the company is just going to ignore them because they’re a small
practice in Massachusetts.
I think this leads to some of the issues that we’re seeing with the virtual
card, things like lack of transparency and the fact that all of the— well,
Heather said 96 percent of the people she talked to says that they’re in
opt-out. Everybody that I have talked to in all of the different conferences
has said, it’s opt-out. They just replace the check with the virtual card
transaction. In talking with the bankers, the bankers that operate a lockbox, a
healthcare lockbox, they’re seeing in the lockbox areas that the virtual card
payment is being sent instead of a check to the lockboxes, and then the
lockboxes are processing them.
We feel this is counter to the goals of administrative simplification. There
is no automatic reconciliation. At this point, there is no HIPAA compliant ERA
that can be used with a virtual card. There is a manual process associated with
this in most cases. The card companies do now offer an automated process, but
the majority of the providers have to manually key in the virtual card number
to the POS terminal, and then they have to use an EOB to reconcile this.
This we view as in direct conflict with the ACA. Again, it increases the
cost to the healthcare provider because they are now paying interchange fees.
When Jan testified in January, we looked from a NACHA perspective at the
volumes that we were seeing from the ACH for healthcare payments and
extrapolated that out to a three percent average interchange fee and annualized
it. It was $16.2 billion in costs to the industry in interchange fees. That’s
We don’t feel that the continued use of this would lead to the expected
changes. Again, as has been pointed out by both the previous testifiers, we are
seeing a challenge with the healthcare EFT standard in that because the health
plans are now getting a rebate on their virtual card transactions, they’re
expecting the same type of payment for the ACH transactions. We’re seeing
situations where a provider— where a health plan on its website has very
specific language that says if you’re going to sign up for EFT, you’re going to
pay a one percent interchange fee, and you cannot charge that back to the
It is a payment from the provider to the health plan. We do feel that it
does conflict with HIPAA 45 CFR 162.925 sub-section 5. From an industry
guidance perspective, we do appreciate the fact that CMS has issued their
guidance. We do ask that “excessive” be defined, and that we do not
feel that CMS has addressed the unilateral imposition of non-standard
In conclusion what we’re looking at from NACHA’s perspective is a couple of
things, or what we would like to request is that NACHA recommends that HHS
fully treat the healthcare EFT standard transaction as it does all other HIPAA
standard transactions, as an actual standard rather than one among many
options. In the event that HHS continues to treat the healthcare EFT standard
transaction as optional, it should establish parameters on when and how virtual
card payment or program can be implemented. We’d like to request that you
require an opt-in for virtual card payments by someone that has authority in
the provider’s office to make agreements for the provider.
We require that virtual card payment documents do contain clear instructions
on how to opt-out of the virtual card programs, require virtual card payment
documents to disclose to the provider the cost of processing the payments, and
prohibit the requirement that the providers accept virtual card payments as
part of their contract with the health plan. These parameters would enable the
provider to better manage their costs for receiving payments for healthcare
claims and better enable the industry to meet administrative simplification
objectives of the ACA. Thank you.
DR. SUAREZ: Thank you so much, Priscilla. Sajid?
MR. IMAM: Good morning everyone, co-chairman Suarez, and members of the
Subcommittee on Standards. My name is Sajid Imam. I’m a senior director at
Visa, Inc. We are responsible for commercial healthcare products. I want to
thank you for the opportunity to appear before this subcommittee and to discuss
the use of virtual card payments and explain why cards should remain a viable
option for use by healthcare payers and providers.
Visa believes that health plans should be able to offer and providers should
be able to choose between multiple EFT options for care payments as this will
only promote further competition and innovation in the delivery of healthcare
payments and services. As a global digital payments technology, Visa connects
financial institutions, merchants, and governments. Visa makes digital commerce
convenient, reliable, and secure. Visa does not issue payment cards. Our
financial partners do. Nor does it contract with merchants to accept those
cards. Those virtual cards are issued through a financial institution and can
be used by health plans to pay a healthcare provider.
Providers can accept those payments just as they currently do other card
transactions that a process will let one of the card networks such as Visa,
MasterCard, and American Express. Virtual cards are a recurring form of payment
type for most business-to-business payments, including payer-to-provider claim
payments as it offers both payers and providers benefits that other EFT methods
There are a number of reasons why healthcare payers and providers chose
virtual cards for claim payments over other EFT methods, including for payers,
reduce check and ACH processing costs, create a visibility and control over
claim payments, and increase fraud protection. For providers, some of the
benefits include the ability to use existing payment card infrastructure to
process virtual card transactions. No need to disclose banking information to
health plans. No need to enroll with each health plan to receive payment,
reliable and secure way to receive payment, and guaranteed payment with zero
liability in the case of fraud.
The HHS in its January 2012 interim rule appropriately recognized that no
single means of EFT can meet the needs of all participants in the healthcare
industry and allowed the use of multiple EFT methods, including payment cards,
for healthcare payments, yet there still remain significant issues and
challenges to payment card use, some of which have been raised by stakeholders
who may be seeking to reduce the payment choices available to providers.
First, because HHS only adopted an EFT standards for EFT payments via the
ACH network in its 2012 final rules, there remains confusion as to whether
healthcare claim payments can be made by a payment card and other non-ACH
payment methods in a HIPAA compliant manner, notwithstanding HHS’ ruling that
payment card is an acceptable means of EFT payment. Many virtual card solution
providers currently mirror the EFT standard for ACH payments and include the
trace number segment along with card number in the virtual card EFT to help
enable providers reconcile the payment with the corresponding ERA.
To ensure consistency across the industry and reduce confusion, however,
Visa is strongly supportive of efforts to develop and recognize common
standards and operating rules for payment card EFT, including provisions
establishing addenda data formats to help providers re-associate and reconcile
claim payments. Visa requests that this subcommittee and HHS participate in
this effort in the same manner as it participated in the efforts to develop
HIPAA standards and operating rules for ACH payments. Visa further encourages
that such standard making process be open to all interested stakeholders,
including those from the card industry.
Second, the ASC X12 standards for electronic data interchange implementation
guide that was adopted for the ERA transaction under HIPAA currently does not
provide for a code to indicate payment card as a method of EFT payment. As a
result, certain market participants have taken this to mean that payment cards
are not permissible for use in a HIPAA compliant ERA. We would therefore
request that this subcommittee and the HHS support within the ASC X12 the
incorporation of such a code into an 835 implementation guideline.
Finally, I want to address upfront the suggestions that some providers are
being forced to accept virtual cards and are discouraged from using other EFT
methods through use of disincentives such as by imposing excessive fees or
delaying payment by ACH EFT for reasons unrelated to the nature of the payment
method. Visa does not condone, not tolerate, those types of business practices
and believes strongly that it should be up to the providers to select the EFT
payment method that best serves their needs, taking into account all relative
considerations, including cost.
Furthermore, Visa believes that the appropriate response against these forms
of abuse of practices is increased transparency and compliance education and/or
enforcement, not the elimination of flexibility and choice for healthcare
payers and providers. In fact, there is wide support among the payment industry
to establish robust best practices. Visa is fully committed to working with
this committee or the appropriate committee to advance those objectives. Thank
you again for the opportunity today to discuss virtual card payments, and I
look forward to working with this committee and other stakeholders to promote
provider choice in EFT payment methods.
DR. SUAREZ: Thank you so much. We’re going to go to Laurie.
MS. BURCKHARDT: As you can see, a hot topic. From an X12 perspective on your
questions, I’m only going to give really enough data on item number three, but
as you can hear from the testimony so far, 1, 2, and 4 have resulted in some
points that I will be speaking to just because of the issues we had.
As you heard, we did receive change request 1265 back in May of 2013. It was
renamed to Supporting Card Payments within the 835 because we did recognize
from an X12 perspective that credit card payments were being done, and as you
heard, the current ERA 835, version 5010 does not support credit card payment
in that transaction.
The challenges as Matthew and Heather have both indicated, education is huge
in this topic. I’m not going to even call it credit cards. I’m just going to
call it a topic. One of the things is the use of the credit card payments
occurs today, which is why this change request did go forward from an X12
perspective, and the providers not receiving notification. These two items have
resulted in hot, hot, lively discussions within the X12.
The other two main bullets, one of the things just to let you know is as an
X12 and TGB task-group co-chair, I led the discussions because there was such
variance of opinions of this topic that we needed to really bring in some
additional leadership. Again, it was very controversial. As a facilitator, I
unfortunately had to handle the draw. We had 23 votes to go move this forward.
We had 23 votes to not move it forward, that it had to be dropped. I
unfortunately had to make the call. From an X12 perspective, as I said, we
recognize that credit card is being used today, and we understood that if a
provider wanted to receive credit cards, and you wanted to receive the 835, we
wanted to make our transaction fit that need.
The status of the 835 and the transactions, we had special calls that were
held to discuss the business requirements for this change request. We had all
the various stakeholders within our discussions. From a technical aspect, the
835 transaction needed minimal changes to accommodate the credit card. We
basically needed to add two qualifiers to say is it a credit card or is it a
debit card. We need the ability to report the card number. The security—
the ability to do the card number, the security card, and then the expiration
What did happen is there are significant changes to the front matter that
needed to occur. We developed workflows. We had some individuals from the
banking industry, from the credit card companies, help us with developing
potential workflows. We needed to — very big in is that credit card type
had to be willing trading partners. It wasn’t something that the health plan
could enforce. It really addressed the opt-in, opt-out. It is that both the
health plan and the provider had to be willing to take the card payment. Again,
these are the current front matter changes that are being recommended for this
Health plans may not delay or reject EFT or ERA transactions because it is a
standard. We also pointed to 45 CFR Part 162.925, which basically talked about
the excessive fees as we’ve already heard from Heather and other individuals.
Then there’s also a written agreement that needs to contain how fees are going
to be assessed within the transaction— within the agreement between the
provider and the health plan. Some other changes are the payee must provide
written instructions on how the fees are assessed, a registration process, just
like EFT is a registration process, expectations on how the workflow is going
to happen between the payer and the provider, and the provider must be an opt
in, and there would not be an opt out.
The next steps, a work group is going to continue to work on obtaining the
business requirements. The items that I have are just a high level. We are not
done. One of the outcomes is that we do expect that once we do complete we are
going to put it on hold until we hear the outcome from this hearing. We believe
that what comes out of this committee and the recommendations are going to have
a significant impact on where we go next.
Part of the process is once the business requirements are done, it does have
to go to our technical task group. They’ll work on it, they’ll make the changes
to the transaction, and it will come back to the business work group to make
sure the approval process is done. We do expect that change request 1265 will
be in the next version as recommended for HIPAA. I look forward to questions.
DR. SUAREZ: Thank you very much. We’re going to go to questions now. Before
we go, I want to make a couple of statements. This has been, and it is a very
controversial issue in a couple of ways, more than a couple of ways probably. I
do want to distinguish two things. One is the current, immediate practice that
is occurring with respect to the use of virtual cards and how providers are
being enrolled and the challenges they’re having with respect to transparency
and optionality and opt-out and those kind of things, or even opt-in. for that
matter, so there’s that issue of the immediate practice, the immediate, current
The second part is really the incorporation of an option in the standard.
That seems to be another set of elements in the process. Clearly, as has been
mentioned in the discussion of X12, there’s going to be more to talk about the
inclusion of these standards, this option— the consideration of including
this option into the standard for future versions, that was part of my question
earlier about what happens when there is a potential need to include something
in the current version. There are considerations about that already in the
standard part. I think that’s one type of question and issue, but again the
other big one is really the current practice and what can be done.
Two other things, we do want to acknowledge that one of the groups that is
not represented in our panel today is health plans. We had a little bit of a
miscommunication with the health plans. They have testified on this in the
past. Actually in the previous hearing we heard a testimony about the health
plan perspective. We heard a number of important points, including the fact
that from the perspective of the health plan representative, there was clearly
a point that wasn’t a specific practice, this type of engagement and as being
reported forcing providers into a particular way. It wasn’t a practice,
although we’re hearing certainly that this does seem to be a practice in a
number of situations.
With respect to the fact that we don’t have a health plan representative we
are doing three things. Number one, we’re inviting anyone in the room here or
on the phone that is a health plan that if they want to make a statement, and I
understand it’s something that is a very last minute option, but certainly we
want to invite anyone that is from the health plans that want to make a brief
statement to feel free to do it now. They can do it later on also during the
public comment period, but I wanted to offer the option today and right now
during this session if there’s a health plan in the room that wants to do that.
Secondly, we’re going to invite written testimony from the American Health
Insurance Plan Association, with respect to this issue. We’re going to also
invite to one of our upcoming subcommittee meetings a representative, or a
couple of representatives from the health plans to express their perspectives
on this as well. We’re going to engage them as we continue to discuss this
The second part is we did not have also a representative from the operating
rules organization, CORE, I this particular panel, but since we have Denise at
the table, I want to also offer the opportunity for CORE to express any
comments regarding this. There might actually be some questions that might be
directed to them.
With that, I’m going to open it for the committee members to make any
questions. After we go around a few questions, again, if any health plan in the
room wants to make a statement, and certainly if CORE wants to make a
statement, they’re welcome to do so.
MR. SOONTHORNSIMA: Hey Walter, this is Ob. I just wanted to call in and let
you know I got on the call.
DR. SUAREZ: Wonderful, welcome aboard Ob. Thank you, and if
you have any questions, we’ll go to you as well.
MR. SOONTHORNISMA: Thank you, nothing right now.
MS. KLOSS: This certainly seems to fall under the heading of unintended
consequences of a really important EFT standard and its implementation. Mr.
Imam, could you comment — I’m going back to your comment that this is a
very common practice in business-to-business payment. Are there guidance
mechanisms? Are there best practices? Are there learnings and agreements as to
what those best practices might be that could be useful to this discussion as
we go forward?
MR. IMAM: The use of virtual cards for business-to-business payments is a
common practice. What we provide to our financial institution partners—
and it’s not specifically geared towards healthcare because healthcare is an
area that is still up and coming on the virtual card side— where this is
much more established we provide general guidelines that any time what we call
in the commercial world a buyer, procuring services, and that needs to make a
supplier payment, any time they’re actually moving away from a particular
payment method to a new payment method they need to actually do a communication
The last thing you actually want is for a supplier or a merchant to receive
a card number, whether it’s via fax or email— they need to know what to do
with it. They need to know where it’s coming from, why it’s coming. The best
practice is any time a buyer is actually incorporating a card into their
payment options, they need to do a communication exercise letting them know
they’re actually going to be incorporating or changing or adding cards into the
option for making payments. This is how they’re going to be receiving the card
number and what to do with it.
MS. KLOSS: So notice is a best practice?
MR. IMAM: Communication, absolutely, it’s a best practice.
MS. KLOSS: What are other mechanisms for resolving those conflicts that do
MR. IMAM: Conflicts in terms of if somebody didn’t want to basically accept
card payment? So the options— from our perspective it is always the
merchant’s decision. It should be the merchant’s decision to make a payment.
Nobody should actually be forced into making a payment, provided that— the
only thing I have actually heard is a buyer sometimes, they want to basically
move away from paper-based check payments to electronic.
Certainly in the healthcare space we believe the law is actually clear. We
know that providers, if they request a payment via ACH, a payer has to make a
payment. When we’ve actually certainly spoken— as the law became clear,
when we’ve spoken to financial institutions or a third-party client who makes
payment, we’ve actually said ACH has to be an option that you have to provide.
If a provider comes back and says they want to receive a payment by an ACH, you
have to meet that requirement. Otherwise as I understand it, you’re actually
breaking the law.
I don’t actually— certainly I’m only speaking here on behalf of Visa,
but I certainly know from a payment card perspective we believe the law is
actually clear, that providers should be given the choice. It should be the
provider’s choice, and they’ve indicated they want to receive a payment by ACH,
the ACH has to be the way they should be paid, certainly in the healthcare
MS. GOSS: I’ve noticed a number of comments of the testimony referenced
162.925, and of course I used to sleep with this reg underneath my pillow, but
I haven’t lately. I looked it up. It says the health plan that operates as a
healthcare clearinghouse requires an entity to use a healthcare clearinghouse
to receive process or transmit a standard transaction, may not charge fees or
costs in excess of the fees or costs for normal telecommunications that the
entity incurs when it directly transmits or receives a standard transaction to
or from a health plan.
I don’t believe we’re charging for ACH typically in the past. I’m curious as
to where— get some further commentary from those who testified today on
this implication. When we look at this provision, there’s a fine line between
wanting to motivate someone to use a more effective manner and sometimes when
we’re trying to innovate towards a new direction we don’t charge fees. We’re
trying to incentivize people to use it. I don’t think typically there’s been an
ACH related fee to providers. We’ve set a norm there, but it does permit the
ability for charging for those reasonable fees— what is the normal kind of
cost in that realm? What should we understand as a committee is really
happening out there in the marketplace?
MS. HOLLAND: From NACHA’s perspective, we have nothing in the NACHA
operating rules that says anything about charging fees. That’s something that’s
not NACHA’s purview. From an industry perspective, and I was an ex-banker,
looking at what the industry does typically, a payer does not charge a receiver
for an ACH transaction to pay a bill in any of the other industries.
From a banking perspective there is a publication that is put out every year
that is the Phoenix-Hecht Blue Book of Bank Prices. They actually go out and
survey what the banks charge their customers for services. The average charge
for a bank to their ACH originator, which the health plan or their vendor would
be, for originating an ACH is done on a per transaction situation, and the
average cost is 34 cents.
MS. GOSS: So in essence it is a sort of a cost of doing business when you’ve
got a contractual relationship between, as he put it, a buyer and a supplier,
that part of doing that ACH is just sort of a cost of doing business at 34
cents a clip.
MS. KLOSS: A transaction, not a percent.
MS. HOLLAND: Correct, a transaction, so it’s every time they originate an
ACH CCD transaction and you put a group of them in a batch and send them off to
a bank. The bank charges their originators an average of 34 cents. If they are
a very large originator, that price is considerably lower.
MR. DOWNEY: As an ex-banker and as an assistant treasurer on
the provider side, we have a myriad of fees that we’ve negotiated with our
banking partners for a variety of transactions they process for us. We have
always paid our banks to clear our checks. We have always paid our banks to
receive our electronic transactions, ACH, of whatever standard entry class they
are. We have never paid an additional fee to the originator of those
transactions. Those originators pay their appropriate banking fees as well. My
point here is that the clearinghouses and payment agents that have been
employed by the health plans are attempting to assess an additional fee beyond
what I interpret the HIPAA section that we’ve quoted allows for. That is my
response to this. I think it should be clearly delineated.
DR. SUAREZ: We have Larry and Jim. Pardon me, I’m sorry. Anybody else
who— Denise, I’m sorry.
MS. BUENNING: You had asked specifically if CAQH CORE would comment. I do
want to offer a comment. Obviously CAQH CORE very much supports low cost, no
cost EFT exchange. That’s the whole idea of administrative simplification, to
reduce burden and to eliminate or reduce as much as possible the cost of
That being said, should it be determined that this is a growing trend, if
this gains volume and this is something that is going to emerge as an issue,
X12 certainly is taking a fast track on this with regard to their examination
of this. If they want to determine that there would be a change in the
standard, the X12 standard, the transaction for example, we would obviously
respond to that with a corresponding operating rule, again gathering industry
input and collaboration on the development of any such operating rule.
DR. GREEN: Do virtual credit cards for claims payment support the goals of
administrative simplification, yes or no? Let’s take a vote. I heard the 23-23
vote. Everybody that thinks it supports administrative simplification put your
hand up. Those— people are still voting, polls are about to close. How
many think it does not? How many have no clue? Another quick question is we
have written testimony that says that the NCPDP SNIP committee is unaware of
any pharmacy currently receiving payments via the credit cards for claims
payment reported by the ACS X12 835 transactions, is that correct?
DR. SUAREZ: That’s correct.
MS. WEIKER: Right now they don’t. That doesn’t mean tomorrow they won’t
DR. SUAREZ: I do want to acknowledge, as Larry has pointed out, we have
received a number of written testimonies, including NCPDP’s, on this topic as
well. They all will be included on the record and in considering our
deliberations as we discuss these points.
DR. SORACE: I just have two points of really quick verification. I was
curious if, Priscilla Holland, if you could just tell me if it’s 34 cent per
transaction, then how large were these bundles? It’s not per bill. I assume
there may be several dozens to a thousand things wrapped up in each of those 34
MS. HOLLAND: In an ACH transaction they count per transaction. It’s somewhat
different than the X12 transactions. What you get is when someone is creating a
payment there is a— in the CCD world, it would be for each payment that is
being originated. If I’m going to pay a thousand different receivers, I’m going
to have a thousand specific payments.
DR. SORACE: It would be 34 cents times 1,000?
MS. HOLLAND: An average charge is 34 cents. There are a lot of companies
that pay less than a penny to originate.
DR. SORACE: The average is the mean or the median?
MS. HOLLAND: I don‘t know the answer to
DR. SORACE: We can’t even know that actually. The other thing, could you
explain the 835 standard to me and the 1265 change request? There are these
upfront materials that go with it. Is that going to include things like
turnaround times and costs for each of these payment options? How often in the
workflow do they have to lead to that?
MS. BURCKHARDT: So the 835 transaction is a HIPAA standard transaction. It
tells the provider— the payer creates it. It tells the provider here’s the
claims I processed. Here’s what I paid. Here’s what I didn’t pay. This is why I
didn’t pay or cut back. In there it has the payment type. Today it’s check or
EFT. For the credit card, the 835 is not being produced or is being produced
and they’ve circumvented the 835 saying give me a call and I’ll tell you the
What does happen is that— in the transaction itself there is how to do
the technical piece of it, how to create the document, and then there’s the
front part, which we call front matter, that explains some of the roles and the
rules that have to be followed. We can include diagrams of how— this is
the workflow for this transaction. Part of our business requirements— so
change request 1265 came forward and the change request said we need to be able
to put credit card payments, allow credit card payments in the 835 transaction.
Now the work group takes that and says what is it going to take for this to
be done and done correctly? Part of that front matter change would be adding
some of the things we talked about— we reference the CFR and we don’t
reiterate, we just reference it in case it ever changes or gets updated, but we
just want to make sure the industry is aware of it and they’re educated. It’s
really— as far as the fees and assessments we say that the payer and the
provider has to have that dialogue. We don’t say what the fees should be
because that’s between trading partners.
MS. WEIKER: Turnaround times and those types of things are handled by the
DR. SUAREZ: Can I quickly follow up on this? The change request is for the
next version, not for the existing version.
MS. BURCKHARDT: The current version is a done deal. Industry is already
using it, has been for a number of years. It would take that errata in order
for us to put it in today’s transactions.
DR. SUAREZ: Sajid, you had some comment.
MR. IMAM: Just a comment, I believe, and again I could be
wrong here because I’ve just become a member of the ASC X12 committee, but my
understanding is that the Standards Committee, and the Standards Committee’s
role should be to incorporate codes for all types of EFT that are currently
allowed and are being used under the law. I believe the X12 committee should
not actually be using their form to debate whether something should be allowed
or not. There should just be a code.
I think there’s a gap in the standards today, where a payment method that is
being used currently. It’s not a pilot. It’s actually happening. There isn’t a
code to describe that payment method. That is actually adding to some of the
administrative burden because providers are actually receiving non-standard
We should actually absolutely have a debate about whether cards and the best
practices for choosing cards and choice and flexibility and fees, I believe
this is a better forum to actually discuss and debate that. I certainly welcome
the opportunity to have that discussion here. I just feel that the issue is
actually getting hijacked at some committees where it shouldn’t be.
DR. SUAREZ: Thanks for the comment. I know we have a person that wants to
make a comment. George, go ahead, and if you can introduce yourself.
MR. ARGES: I am George Arges with the American Hospital
Association. One of the things I would urge X12 to think about is really the
development of another transaction standard that basically takes into account
how providers enroll with health plans. Standardize that, ask the question
there about how you want to have payment be in the instructions of how that
should take place. Do that, and you solve a great deal of the problem.
DR. SUAREZ: Thank you. Thanks George.
MS. WEIKER: And there is an X12 transaction. It’s the 274 transaction. We
are working on that, George.
DR. SUAREZ: Larry, go ahead.
DR. GREEN: My question is for Matthew, Doug, and Sajid.
In your opinions, who is responsible for education and enforcement?
MR. ALBRIGHT: I would say we’re all responsible for education and
enforcement. I think each of us have a particular place in the education,
certainly from the point of view of the CMS, our education is what the
revisions are, what the provider’s choices are. Enforcement definitely lies
with us in terms of some of the things we’ve heard today about accusations or
instances which appear to go outside of the CFR, which was quoted. That’s
MR. DOWNEY: I would view, knowing what I know, that CAQH CORE is in a great
position to do education. NACHA is in a great position to do education. I’m not
sure that CMS is in a place from where I sit to do the broad-based education
outside of Medicare and Medicaid and into the health plan managed care setting.
MR. IMAM: I would agree to a certain extent .I think the education does come
upon all of us, including the card industry. We should definitely be engaging
with the provider community and our financial institution and third party
payment solution providers to engage them and tell them what the bed practices
are. I think we as a group, including whether it’s a recommendation of this
subcommittee or CORE or whoever we need to work with in devising what those
best practices are in the education material— and I think as I mentioned
in my oral testimony that Visa, and I know that certain other folks from the
card industry are actually willing to work with developing those best practices
so that we can actually make that available to all parties concerned.
Enforcement I would actually say— it’s different for us. You guys should
tell us who should actually be enforcing the existing laws.
DR. SUAREZ: I know we have some people that want to make statements. Sidney,
do you want to make a statement?
MR. HEBERT: Yes, my name is Sidney, I am with Humana. As part of my role at
Humana I am responsible for EDI operations. As part of that function, I focus
on deployment and penetration of EDI within our provider community. Part of
that role is looking at an all-channel approach to adoption, and today we sit
at about 94 percent penetration rates for 837 submissions. A very small
percentage of our inbound traffic is paper based. On the EFT side we’re 27
I have two teams who geographically disperse to focus on EMT adoption 24/7.
That’s what we do, try to get people to sign for EFT. It has been a very
tumultuous path to say the least based on the adoption rate. We are picking up
approximately seven points of improvement per year. If I continue at this for
about ten years, I’ll be where I need to be.
Quite frankly, I find that a bit shocking for an industry that pushes $2.6
to $3 trillion a year through our banking systems. As part of that whole
channel approach, we have contracted with CAQH for their multi-payer EFT
registration capabilities. We will adopt that. However, the projections on what
that coverage might look like clearly is not going to get me to my goal of
cutting that ten year time frame in half, anywhere near that. We are actively
involved in implementing an automated solution for EFT registration, ERA
We also have a third party program for what we call e-payment or for virtual
credit card adoption. I think we will be branded as one of the good actors.
I’ve heard of all the bad actors here. I do appreciate I do now know all the
pitfalls. We are using that channel as a channel of last resort. We have
contacted providers, and they have said we’ll continue with receiving checks
for a variety of reasons. Most of them center around lack of trust between a
payer and a provider as to what we might do with their banking information.
The fact that the banking arrangements could be set up so that we can only
deposit and not pick up, I find that hard to reconcile, but that’s the number
one reason we hear that people are not willing to move. As a last resort, we
would like to have our third party approach them in an opt-in fashion to
receive payments electronically via credit card. That service includes a
multi-payer registration panel where they can actually see their deposits and
their ERAs together and do the reconciliation, so it just provides some
From our perspective, it’s just another electronic channel to try to get us
off this stagnant position we’re in in trying to adopt EFT. In my prior life I
was the CIO for a payroll company, a national payroll company. We saw a similar
type of renaissance for a small percentage of the population that just would
not take direct deposit. It doesn’t make sense. It’s in their best interest for
direct deposits but it doesn’t happen.
I think we need as many different methods as possible to automate the
process of fulfillment between payers and providers. This happens to be another
one. Once again, we’re focused on opt-in only. It’s a select group of people
who have said we prefer to stay on paper, and quite frankly that is not
consistent with the administrative simplification.
DR. SUAREZ: Martha, you wanted to say something.
MS. BEARD: My name is Martha Beard. I’m from JP Morgan. I run our insurance
healthcare and our federal government business. I want to thank you very much
for the opportunity to make a couple of comments. I’d just like to add as a
major financial institution that supports hospitals, the funding of hospitals
when they’re much needed in our communities, to support health plans when we’re
looking to build products and put them out in the marketplace, it’s certainly
an industry that JP Morgan knows very well. We are a very large supporter of
administrative simplification and driving efficiency and offering our clients
choice whether it’s a health plan or whether it is a hospital through lock
boxes or other types of electronic payments they need to receive.
I think the question of car payments and ensuring simple and cost effective
administration is a very similar issue and phenomena that we were experiencing
as a bank in the early days of ACH where it was difficult and costly for banks
to process healthcare payments and to re-associate the data and the payments.
We’re at a similar phase as it relates to the introduction of other alternative
payment channels. At the moment I think transparency and rules are an important
tool for the industry to sue to create that transparency and the administrative
simplification that I think we’re all trying to achieve.
I do think that use cases and participant needs are going to vary to the
point that Humana and some of the other panelists have expressed. We certainly
have seen that both in our ACH and in our car business for healthcare, where
you may have a provider who has a one-time payment they’re going to be
receiving from an out-of-network or an out-of-state plan. It’s very difficult
to go through that ACH Registration process. Which is where I believe the
financial institutions have a lot of work to do to educate our clients about
the best way to enroll for ACH.
We do want to make it simple, and in some cases a card is simple. It’s still
early I think in electronification. We certainly would support, as I said
before the drive, for transparency and for efficiency, and any federally
promulgated rules or support or operating rules that might help us do that,
DR. SUAREZ: Thank you so much.
MS. DARST: Just in support of Doug and Heather and Priscilla, the one factor
that we haven’t talked about today is the impact on our patients. As we are
surprised by getting these virtual credit cards. The provider community a lot
of times, pushes back and indicates you’re not going to accept these cards and
accept that associated discount. Our patient has EOBs indicated that their
charges have been paid. While the payer, the vendor, provider battle out the
payment methodology, the patients are caught in the middle. It’s just one other
DR. SUAREZ: Thank you. This is certainly a significant and major topic.
We’re going to continue our discussions— certainly the biggest issue right
now, as I said at the beginning, is consideration about what can be done with
respect to the current practices. We know the process for adopting this
standard is moving along, and the key element this new development which really
are becoming a significant development about the enrollment process, the
concerns about transparency and optionality, and the ability to really opt in,
or even opt out for consents purposes.
We’ll be certainly looking at that, and exploring and working with our
partner, CMS, in understanding the regulatory background and implications and
any possible additional guidance, and potentially, if necessary at some point,
regulation. Certainly they’re all working with the standards organization as
well as our partner on operating rules to understand what can be done with
respect to that. Clearly, the biggest and most significant part is really
education as has been mentioned.
Thank you very, very much for your testimony. We really appreciate it. We
have you on a very speedy phone connection so if we need to follow up with you,
we really appreciate your response. Ob, I wonder if you have any comments or
MR. SOONTHORNSIMA: Just very briefly, I think you summed up very well. I
think at the end of the day the goal is to increase the adoption of things
electronically at its appropriate cost. I heard also the testimony around
making sure that we can close that gap through an 835 acknowledgement, that a
payment has been received and reconciling that. If we could get industry
feedback on those things, how would the card or any sort of payment improve in
a moment from paper-based to electronic at the appropriate cost or no cost? I
think that’s ultimate goal, and of course, reconciling that, whether the
standards subcommittee will help close that gap or educate the stakeholders. I
think that’s going to be the key as well. Thank you Walter.
DR. SUAREZ: We are going to take a ten minute break at this point. We’re
going to move our schedule coordination of benefits after the break. We’ll
start again at 11:15, and I hope that’s okay with people. At 11:15 we’ll come
DR. SUAREZ: Okay, our next session is a relatively short session on one of
the transactions that we haven’t talked about too much, and that is
coordination of benefits. We wanted to make sure to have a chance s
subcommittee to hear generally where things are with coordination of benefits
and how are things going with respect to the use of electronic standards and
coordination of benefits. We’re going to start in order. We have CAQH, Atul,
and then we’re going to go to the health plan and the provider, and the health
MR. PHATIYAL: Thank you. My name is Atul Phatiyal. I’m the interim managing
director for CAQH Solutions. CAQH is a not-for-profit organization focused on
collaborative initiatives to streamline business and healthcare. I’m going to
make two points today as I talk about COB. This is largely borne out of the
research we’ve done over the last three years.
One is knowledge about COB, about individuals that have coordination of
benefits that have multiple forms of coverage is substantially lacking today.
The traditional methods of understanding when an individual’s benefits should
be coordinated, those traditional methods don’t work particularly well. We have
data to substantiate that.
Secondly, and probably more importantly, because we don’t get that
information identified correctly, completely accurately and so on, because of
that a lot of the processes that are put into place right now across the
industry on the payer side and on the provider side are largely reactive and
focused on correcting the mistake. Our premise here is as an industry we should
be focused on ensuring that COB claims are processed correctly the first time.
The more we can do towards ensuring that outcome, the better the entire COB
process will be.
Let me walk through just a little bit of our background here. Three years
ago we started look at the coordination of benefits space and performed a
variety of research, most notably of which was interviewing numerous providers,
health plans, clearinghouses, other stakeholders, across the healthcare
continuum. We wanted to make sure we were able to map out objectively how
coordination of benefits today manifests and its concomitant problems.
We started before the patient walks in the door— in the provider
vernacular that’s typically the patient access— processes, all the way
through service delivery and the corresponding revenue cycle and then post-pay,
and tried to make sure we understood where all the different inefficiencies
were, where all the administrative challenges were associated with this
Important for CAQH is to make sure that we have a clear understanding of
where these challenges manifest for both the provider and the health plan as
separate stakeholders that are looking at the same problem. We understood that
there were pain points around data collection. Typically the provider’s patient
registration form is their primary way of understanding when a patient presents
with multiple forms of insurance, but they’re also other challenges that they
see, if you look at the different hops associated with getting a COB claim paid
correctly between the primary and secondary payer and so on.
We performed the same analysis on the health plan side and saw similar
themes although the perspective was definitely health plan centric. Similarly,
understanding when a health plan’s members have multiple forms of coverage,
when that knowledge is discovered and how they’re able to apply that knowledge
to their benefit adjudication created a lot of inefficiencies. We put that into
a model, and based off of our research with what we believe to be very
conservative assumptions, we think that the industry as a whole is spending
north of $800 million a year just to get a claim paid correctly for COB cases.
This is not around the recovery costs or anything like that. This is just
the administrative challenges associated with trying to send a claim to the
right payers in the right order, and then when that doesn’t work, fixing the
problem, both on the payer side and the provider side. Again, as the shading on
this slide describes, those costs are actually borne pretty equally across both
sides of the equation, on the payer side and the provider side.
Last year CAQH launched an industry-wide registry that’s focused on
identifying individuals with multiple forms of coverage. The way we do that is
we look across health plan enrollment files on a weekly basis to discover when
an individual appears on more than one health plan’s roster. We then apply
primacy rules to determine what the right order of benefits is for those
individuals and then send that information to what we believe are the three
critical stakeholders in a COB case, the primary payer, the secondary payer,
and the provider who’s submitting the claims. WE want to make sure that all
three stakeholders have a complete and current picture of the benefit situation
for that patient so they can make the right claims processing decision.
Again, we launched that late last year. We have 12 health plans
participating. We have just about 120 million individuals in that registry, of
which the vast majority have medical coverage.
As I mentioned earlier, a key finding for us is that the current knowledge
around COB is substantially lacking in our estimation. What this slide depicts
here is the results from one of our registry participants, it’s a large
national payer. What the top graph here depicts is the number of members,
health plan members, that they were able to discover that had other forms of
coverage using this registry. What the orange depicts here is the number of
members that they knew to have COB through their traditional means, essentially
member canvasing. Then the 79 percent are the additional COB cases, the
additional individuals with COB that they were able to discover by looking at
the problem through this registry lens.
We’ve seen these results across other payers as well. WE thought this was
probably the most compelling one to share although this is right in the middle
of the pack here. A key point here is on a four to one basis, there is more COB
out there in that health plan’s population than they were able to identify
through legacy means. The second graph here is an important point from a health
plan perspective. Really just to dispel a myth that has emerged that the COB
that is unknown, that the previously unknown COB has potentially increased
payer exposure, payer payment exposure.
The results that we’ve seen so far suggest that’s not true. This increased
COB is actually pretty equally split across primary payment and secondary
payment responsibility. Learning about COB does not necessarily put the payer
at a financial disadvantage. It actually in our mind speaks to this
industry-wide need around ensuring that claims are sent to the right payer so
that benefits can be adjudicated correctly.
We’ve only been live for about eight months now, and we are in the process
of completing a national roll-out. We are taking a market-by-market approach.
We will be live nationally next week and look forward to being able to provide
additional insights as we get deeper into this journey. What we intend to do as
this solution is completed or as we complete the national roll-out is be able
to send this information— essentially as I said earlier, we want to send
information to both the primary care, the secondary care, and the provider. Our
premise is if we can get this information into the provider’s hands as quickly
as possible that provider will be able to send claims to the right payers in
the right order and avoid all that rework and retrospective focus that the
industry currently has.
From a conceptual experience perspective, what we intend to do is be able to
supply in the standard eligibility responses that providers are very familiar
with that they use in their standard workflow, provide rich COB information
that can be used in the front end of that revenue cycle process. As you can see
here on this slide, as payers, as clearinghouses, et cetera, start to embed
this CAQH registry information into their eligibility responses, we’ll be able
to educate that provider with the correct payment instructions— coverage
information for revenue cycle purposes.
Lastly, I included a couple of thoughts per one of the questions in the
agenda here around where there might be opportunities for operating rules. WE
have communicated these preliminary findings over to CAQH CORE. We see that
opportunities for operating rules to help improve the likelihood of getting
correct information to the provider and the payers, but to the provider before
the claim is submitted, for the primary claim, but then importantly providing
enough information to the provider for the secondary claim so that the
secondary claim can be sent electronically. We’ll continue to share our
findings with CAQH CORE and their board to make sure that this is contemplated
as they define their roadmap for the future.
DR. SUAREZ: Thank you very much. I think Sean is next.
MR. KILLEEN: My name is Sean Killeen. I’m executive director for COB and
claims cost containment nationally with the Kaiser Permanente organization. I’m
going to speak on behalf of the plan. Let me just say that Kaiser is both a
health plan and a provider. I can offer a little bit of perspective on the
provider side but not greatly from the billing perspective at all, although
I’ll note those as I can.
What I did is there were five question prompts that I was given. I’m just
responding to those. The focus here is on our electronic experience, and I have
some peripheral observations that I think impact that as well. First question
was around what is the current status of implementation of the electronic COB
with version 5010. We are compliant in the respect that we’re able to receive
and map a 5010 COB data set, off the loops, off an 837 transaction, but we’re
not mapping that into the claims transactions.
The legacy systems that we have largely are still in a 4010 mode, and so
when you map a 5010 dataset, if the data elements have been provided with
respect to COB, some of them may be dropped and not populated in the system.
Probably more problematic is those systems are generally not able to process
COB electronically. When I mean electronically I’m talking about full auto
adjudication of a COB claim.
We are in the middle of a claims transformation project that has been going
on for a couple of years and will continue through this year and next. By 2016,
we do expect to be able to process electronic 837 COB, full COB set if it’s
available and provided into an electronic COB transaction. We plan to be able
to do that not just for our outside medical claims, which today dominate our
claim universe, but also for our internal encounter KP-to-KP, Kaiser-to-Kaiser
claims that we’ll be processing as part of this transaction.
I don’t think we’re necessarily alone out there in the universe of plans
that have system issues with respect to the ability to fully electronically
process secondary claims. With respect to the current model being followed,
threw ere some choices. WE follow what is basically industry standard, which is
provider-to-plan COB. What that means is the provider bills— the first
primary plan receives a remittance EOB back, creates a secondary claim, sends
that to the secondary plan who receives it, a remittance back from the
Inside the house we call it the ping pong approach as opposed to what’s
called cross over, which is a plan-to-plan that’s where this primary claim
ceases a claim that can be forwarded to the secondary plan. That’s not industry
standards and to my knowledge not at all common. I believe Medicare has some
capability to do cross over. We don’t have cross over implemented with Medicare
when Medicare is prime.
As I’ve indicated, one of the major constraints there is that claims
transactional systems, not just our system but in general in the industry,
aren’t able— lack this functionality to create a crossover claim. In fact,
even in the claim project that we’re engaged in now internally for our own
KP-to-KP transactions, we’ll be following the back and forth or ping pong
We do have plan-to-plan coverage data sharing that we’re now doing through
the COB smart program of CAQH. We’re one of the 12 participant plans in that.
That has substantially improved the availability of data, of other coverage
data required to do COB. That’s quite a significant move. That may open up
opportunities for plan-to-plan interaction that we haven’t seen before. We’re
looking at five times to ten times more information than we might have
perceived through member surveys or asking the members directly. More
importantly, it’s established a plan-to-plan communication and sharing that we
think is significant that may offer opportunities.
One of the other issues with the implementation of electronic COB, I
extended this to offer some input about some other things that I think are
significant with regard to processing a COB transaction. As I’ve said, legacy
systems are not able to receive and electronically populate the required fields
from an EDI837 COB segment. That’s just the current state. Not all plans
obviously are in that condition. I would say many plans still are in that
condition. As I’ve indicated, we’re on a path to change that.
However, when provided, provider errors incorrectly populate the data
elements in these COB segments, we’ve observed they’re an issue. Where we have
turned it on on a new claim system implementation where we are able to map
these data elements we’re finding that the data elements coming through
initially are not allowing us to process the claim electronically anyway. We’re
having to drop the manual because the allowable is in the wrong data field or
some other data element is in the wrong field. It has to come in perfectly in
order for it to electronically process. That’s an issue on the provider side.
Calculation methods for COB in systems again lack some of the functionality
to deal with all of the myriad of COB type of situations. You have state
regulations, which impact COB calculations, whether or not you have a benefit
reserve, whether or not individual type plans are allowed for COB or not
allowed for COB. You’ve got provider contract terms that impact the electronic
processing of transactions, which allowable you’re paying to. All of this
diversity adds complexity to which systems today are challenged to support.
Beyond just receiving an 837 with the data is the rules around COB transactions
and how to have them electronically processed. That’s quite challenging as
I won’t comment on the topic of operating rules, current status, because I’m
deferring to CAQH. My conclusion here, top priorities where rules are needed,
one, not that it’s achievable, but a national standard set of COB rules,
guidelines for everything from primacy to the concept of a benefit reserve, the
determination of an allowable, what plan types are included, and other areas,
whether that be adoption of the NAIC’s standards or something similar, that
would go a long way to administrative simplification. Right now it’s state to
state, and it’s entirely up to the state to determine what standard they adopt.
Then part two, data integrity will clearly be an issue in any kind of capable
electronic transaction process.
DR. SUAREZ: Thanks, we’re going to go to Laurie.
MS. DARST: I am Laurie Darst, Revenue Cycle Regulatory
Advisor for Mayo Clinic, and this morning I’m speaking on
behalf of Mayo Clinic. The focus of my testimony is to discuss some potential
opportunities related to Payer-to-Payer COB and the associated issues the
industry would need to address to identify and to realize the administrative
As stated, currently, the only Payer-to-Payer COB actively conducted is the
Medicare Crossover. This process greatly benefits both the patient and the
provider. The Medicare Crossover process allows the participating Medicare
supplement payers to send their subscriber enrollment information to Medicare.
Medicare then uses this information to flag processed claims. Medicare creates
an 837 form with the processed claim payment information which is sent to the
payer immediately after the Medicare payment has been issued.
There is no delay in expediting secondary payment consideration. Providers
do not need to expend resources matching up the Medicare Explanation of
Benefits and then sending the claims to the Medicare supplemental payer.
Payment is made more timely, which benefits both the provider and the patient.
Currently, there are 900 payers signed up to participate in the Medicare
Crossover process. At Mayo Clinic, we identified 55,000 claims that Medicare
automatically sent COB information to, secondary payers just in
the month of April. This claim volume translates to an 11 FTE savings in
claim filing resources.
As beneficial as the Medicare crossover process is to providers, there are a
few opportunities for improvement with COB that I will talk about later in my
testimony. These opportunities will be an important factor as we look at
potentially expanding COB to other commercial payers.
Given the success of the Medicare Crossover process, we feel there is an
opportunity to expand this further. Payer-to-Payer COB would cut down on
resources required to match up the primary payer EOBs and sending the primary
payment information along with the claim to the secondary payer. If the
Payer-to-Payer COB was implemented, resource saving projections for our
organization alone are an average of 23,000 claims per month, with an
anticipated staff resource savings opportunity of 4.6 FTE. In addition,
providers would receive their payments sooner, thereby reducing their DRO.
Finally, our patients would benefit by having their claims adjudicated sooner.
Another potential benefit of expanding COB to commercial payers is the
opportunity for reducing COB denials, and this really goes back I think to
CAQH’s comments also, and that also the associated rework when a provider does
not have the most up-to-date primary insurance information. Today, both
providers and payers rely on patient supplied information to update their
If the industry considers adoption of the same type of subscriber enrollment
file exchange that is used for Medicare, most of the COB denials and rework
could be drastically reduced. In situations where the receiving payer was not
the primary payer, they could forward the claim to the primary payer based on
the information they received in the enrollment file.
To summarize, the potential benefits of Payer-to-Payer COB for providers
include: reduced administrative overhead of filing claims to a secondary payer,
reduced DRO with faster payment from the secondary payer, potential opportunity
to update or correct primary/secondary designation resulting in less COB
denials and rework, and finally benefits to patients due to more timely payment
However, there are a number of issues that need to be addressed if we move
forward with Payer-to-Payer COB. It would be important to have open dialog
between stakeholders to make Payer-to-Payer COB viable. Some of the issues that
need to be addressed from a provider perspective include: a clear understanding
on which payers are participating with Payer-to-Payer COB. This is critical so
resources and duplication of effort do not occur. It would also be important to
know those instances when the participating COB payer did not forward the
claim. In today’s Medicare crossover we do receive a remark code on the remit
and also to which payer the crossover was sent. However, no notification is
sent if the crossover fails. Timely updates to insurance changes are essential,
whether it’s new insurance or change in primary/secondary designation. This is
a bit issue today. Finally, small payers may not have the resources or
technology in place to do COB.
In conclusion, we feel there are cost reduction opportunities and DRO
savings with Payer-to-Payer COB. The technology to automate COB is there but is
not widely deployed. There are barriers to overcome to streamline this process.
We would recommend further exploration be done by the industry, perhaps by CORE
Operating Rules and if not Operating rules maybe with WEDI, to determine the
feasibility and essential steps to implement of Payer-to-Payer COB. I would
like to thank the Committee for the opportunity to testify.
DR. SUAREZ: Thank you very much. I think Mary you are on the phone and you
are next. Can you hear us?
MS. HYLAND: Thank you, Walter, and thank you to the committee. This is Mary
Hyland, vice president of the Cooperative Exchange. I’d like to thank you all
for giving the clearinghouses the opportunity to present testimony on the COB
issue. When we look at the process of the transmission of billing information
between primary and secondary health plans for the electronic coordination of
benefits in version 5010, the version is implemented and efficient from the
As you heard from a previous presenter though, some health plans still
internally may be utilizing 4010 as part of their version and not fully
compliant with— fully vetted on 5010 at this point, but have systems in
place that coordinate those activities. Those are some of the areas that we see
some potential impact when the clearinghouses are coordinating the COB
The utilization of the system for the denials and resubmissions that are
conducted, sometimes we receive reasons of denial that are quite varied, but
this may be due to incorrect or invalid information, as was also stated,
collected from the patient at the time of the service. Information may not be
requested or updated by the admission areas or the physician offices, and the
patient may have incorrect information. Their plans may have changed or their
practice plans may have changed and the patient either did not have the new
insurance card or did not know that their insurance plans were changing at all.
The biller sometimes also selects among healthcare plans when billing
through their systems or through just simple errors in submission of
information. We see this varied system capability and tools that are currently
existing in the software of the clearinghouse that correct any of these
problems of the providers. The error messages may come up, but if the incorrect
information is put in initially, then of course the transactions are going to
follow that path that were originally input by the biller or the individual
submitting the information.
It’s up to the provider to gather the correct payer information from the
patient at the start of the process. With these variables, we all understand
that there are going to be issues that impact it. Based on their healthcare
coverage, then the providers also make the determination of primary, secondary,
and tertiary payers and bill accordingly. Now, that all depends on a system and
a process that is in existence in that organization or in that office, and
there are individuals that follow these directives to determine that kind of
We all know that people are strapped at this time in terms of the small
provider centers, and they may not have the personnel on board that have the
knowledge an capabilities to consistently do this in a fashion, but there are
assistants that also assist them with this process as well.
When we look at the current model, the standards for the transmission of the
data elements need to be coordinated for the sequential processing of the
claims from plan to plan. The clearinghouses execute this space on the provider
submission of the information via the transaction.
In our system we have the capability of coordinating all of these efforts,
and do so on a daily basis. With the transactions that are submitted, the payer
requirements for their processes differ. Each health plan differs in terms of
their coordination of benefits model. That leads to additional time and effort
that is needed for the providers to understand, and those who are conducting
this, to actually coordinate the research necessary to ensure that they are
submitting the correct primary, secondary, and tertiary models within a
particular episode of care.
The choice of the model is up to the health plan and usually based on the
trading partner agreement to conduct this COB. If the health plan is primary
payer and does not have a trading partner agreement with the secondary payer,
then it may simply dispose of the COB information and leave the COB activity up
to the healthcare provider. If the health plan electronically conducts COB with
another health plan, it does so using standard transactions. A healthcare
provider that choses to conduct COB electronically with the health plan must do
so using those standard transaction, unless there are alternative measures
incorporated in their contracts.
We’re not aware of anyone that is currently conducting transactions from
provider-to-provider, but in terms of issues of the implementation of the
electronic COB, we’re not aware of any issues for the implementation of the COB
from the clearinghouse perspective as we’re utilizing that on a daily basis.
The operating rules, I will also refer you to CAQH CORE in terms of the
status of where they are with those. When we also look at the operating rules
that are needed for COB, we need to ensure that all payers can accept coverage
electronically in situations of COB, and not just primary coverage, and require
acknowledgements in response.
For example, a payer may expect to make 837P, which is a provider
transaction, secondary and tertiary electronically, but it may require the 837
institutional transaction to drop to paper. Since this is a payer-by-payer
situation, there is no database that includes this type of information, and
each clearinghouse normally tracks and provides responses from payers and
displays the information to providers as we connect payer-to-payer.
Some of the key issues that are occurring with the COB, is that we need to
ensure that all payers can accept coverage electronically in situations of COB,
and not just primary coverage. It also requires the acknowledgement and
response. As we look at the example that I just provided regarding dropping to
paper, we also have another situation that also impacts this particular status
and that payers may not accept negative adjustments on the transactions. If a
negative adjustment is included based on an 835 remittance, then a payer may
reject that because they’re not accepting negative adjustments.
Also some of the other elements that are occurring are that payers may still
be using an active passcode or remake code. We also have situations where
payers are not accepting all COB claims electronically on a consistent basis.
It depends on the plan. There are a myriad of situations that are impacting
this element of coordination of benefits. But a major concern is that all
payers accept the electronic COB, and that we understand there’s a limitation
based on trading partner agreement and hope that each party works toward 100
percent compliance in accepting coverage.
Also we’re suggesting the payer industry should work towards not dropping
the paper at all for any COB transaction situation, whether it be for
institutional or provider related transactions.
We would like to suggest that you bring the clearinghouses to the table for
discussion because many of these automated processes have been in effect for
many years. We have the platforms and the bases that are working appropriately
now, and usually when we see the deficiencies is based on incorrect information
being supplied by the provider.
We did want to applaud the educational opportunities that currently are
provided by CMS and health plans. I think it’s well done, the information is
available on their websites and also through other methods. This also assists
new hires in the provider systems to coordinate benefit plans through this
guidance. The step-by-step guidance is an excellent element to correct many of
these issues. In closing, the Cooperative Exchange would also like to thank
members of the committee and their time, and should you have or need additional
information or wish to discuss this further with a smaller group, we’d be more
than happy to do so. Thank you so much.
DR. SUAREZ: Thank you very much, Mary. So we are going to go to our
questions from the subcommittee. Any questions? It seems to me that from what
we’ve heard generally speaking the standards of the 5010 standards seem to be
working. The issue really becomes more of an operating rule and the process
itself for conducting the actual coordination of benefits, as has been noted
needed to be streamlined and better defined.
It seems that the payer approach along with the support from the
applications such as the one that CAQH CORE has developed seems to provide the
opportunities for streamlining and improving the coordination of benefits. Are
there any questions from the subcommittee members at this point? Okay, well,
thank you very much for the testimony. We really appreciate your coming and
sharing your perspectives on this topic. We’re going to move immediately to the
next session, health care attachments. We’re going to go ahead. We welcome our
testifiers on this session. We’re going to start with a review of the status of
attachment standards provided by Durwin and John from HL7, and then we’ll go to
some industry perspectives on attachments. Durwin, do you want to start?
MR. DAY: Health Level 7 International was founded in 1987. It’s a non-profit
anti-standard development organization with more than 23,000 members
representing approximately 500 corporate members, which includes 90 percent of
the information system vendors serving healthcare. Beginning in 2013, HL7
offers free access to its standards, and they’re free, including the standards
that we’ll talk about today for attachments.
On behalf of HL7, I’d like to thank you for the opportunity to present to
the committee today. Today we have John Quinn, chief technical officer of HL7.
I am Durwin Day. I serve as the co-chair for the HL7 attachment workgroup. You
should also know that I’m employed, with 21,000 other members, people, by
Health Care Service Corporation, which is the largest customer-owned health
insurance company in the US, serving about 14 million members.
HCSC, or Health Care Service Corporation, has been a member of HL7 since the
attachment workgroup originated in 1996. For your first question, what is the
status of the development of the attachment standards? There are three parts to
that. The HL7 standards for attachments that have been completely balloted and
published include the HL7 implementation guide for CDA release 2, titled IHE
Health Story Consolidation, which is a DST Release 1. This guide is an HL7
standard that was balloted and published in July of 2012. The guide includes
eight structured document types and a general unstructured type for
They are the continuity of care document, consultation notes, diagnostic
imaging report, discharge summary, history and physical operative note,
procedure note, progress note, and of course the unstructured document. Along
with that, the second part, was the HL7 supplement to the consolidated CDA
templated guide. It was balloted and approved for publication in January of
2013. This guide provides information needed by the stakeholders to utilize the
HL7 clinical document architecture. It explains about the request and the
response for the attachment documents. It describes the types of requests that
can be either solicited or unsolicited or the responses that can be either
structured or unstructured.
The third part is the LOINC code set that identifies the HIPAA attachments,
the types used. The thing to note is that the attachments named here in the
consolidated CDA are the same attachments utilized by the EHR meaningful use
standards. This aligns— by aligning with meaningful use requirements,
providers will not be burdened with having to create and send different
clinical documents to a payer as they would to another provider. A progress
note is simply a progress note. It doesn’t matter who the recipient is.
The second question, were there any significant changes since the committee
issued its recommendations, either from the perspective of the standards, the
enveloping, or transport? There are two notable ones that have been under
development at HL7 for the standards that I’ll mention. The first one is a new
standard for the attachments that’s been balloted, reconciled, and is being
prepared for publication by September of 2014. It’s titled HL7 consolidated CDA
release 2 templates for clinical notes. It will be the replacement for the HL7
consolidated CDA templates called the IHE Health Story Consolidation.
It has those same nine attachment types that I mentioned earlier along with
four new ones. They are care plan, referral note, transfer summary, and
patient-generated documents. It also allows for the addition of the digital
signature, and allows for use of no values at a section level.
The second notable development at HL7 is called HL7 Consolidated CDA
Complete Document Templates. It’s been balloted. It defines five new document
types and eight new section types of templates. It requires the affirmative
attestation for any of the data that has not been reported. It supports the
entire contents of the medical record required for a specific encounter. Those
will be listed in the next item, item three. I’ll leave that for you to review
rather than go through the whole list.
I’m going to move onto question four. It says, what are your perspectives
with respect to alternative attachment standards being considered or balloted
for approval? One of them I just mentioned was the HL7 complete document
template. It primarily addresses the business needs for CMS Medicare to perform
post-paying audits. There may also be other future business scenarios that
support the requirements to receive the entire medical record. The approach is
different than the attachment approach was. The attachment approach was to ask
for a specific element or specific document. This approach asked for the entire
The approach for the CDT, or the complete document template, utilizes the
CDA standard, the same standard, but also requires providers to affirmatively
attest to every data element named in the CDA with either the data collected or
with a null value to indicate the reason for the absence of that data.
There’s also an approach to talk about the standards that are being—
alternate standards that are being used, but there are some alternate
transports also being used that we’d like to mention as well. There are
innovative advances in these methods of transport for clinical information,
such as meaningful use with electronic health records. They mostly use the
protocols for direct and connect.
The last question, question five, says how are clinical data and
administrative data exchanges taking place today? I’ve identified three
scenarios here. The first scenario is the HL7 consolidated CDA being used
electronically with those nine common attachment types, and their exchange
between the provider and the payer support the review and adjudication of
claims. This electronic exchange can replace the heavily burdened paper process
and expedite payment of claims.
In addition to the clinical document types being described within a
consolidated CDA, there are also various non-clinical administrative types of
attachments that are being sent using the unstructured format such as consent
forms in a pdf format. This scenario of electronic exchanges is being conducted
using an HL7 CDA header, with the unstructured document, be it a pdf, and this
is usually an envelope in an X12 275 transaction.
The second scenario I’ll mention here is that the same consolidated CDA is
also used for meaningful use electronic health records and sharing other
clinical information in a number of scenarios. The exchange in these scenarios
are typically done through the use of direct connect. A third implementation
approach that’s being used actually removes the need for the payer to actually
solicit the clinical information from the provider. The provider pushes any
consolidated CDA document being created in that patient’s event.
As an example, a payer is notified that the patient is being admitted to the
hospital, and upon discharge the discharge summary and related operative note
is sent to the payer. As a claim is submitted, the payer can reference the
related consolidated CDA documents. The consolidated CDA document is a DSTU,
and will continue to be developed as other uses and requirements are defined.
MR. QUINN: Durwin has done a great job of giving you a summary of what’s
been going on inside the attachment workgroup and what the current state of the
standards are. For those of you who aren’t familiar with the acronym DSTU, it’s
Draft Standard for Trial Use. That involves the same rigor, it’s just that the
target is getting to the point of then balloting for a normative standard. This
is in effect— you have to have a minimum of two users.
In this case users would be large hospitals or integrated delivery networks
with a strong IT department who would try to use these standards in everyday
use and see whether or not we find bugs. This kind of goes to one of the
original intents of this meeting to begin with. What’s the current state? Do we
test our standards? Yeah, you can stare at a stack of paper until your eyes
cross and you can’t stay awake, and you’re still not going to see the errors
that are in there. The reality is just by giving it to users to use for a year
or two that have signed up— in other words, you can’t have a DSTU if you
don’t have committed organizations to use it. That’s the status of what you see
DR. SUAREZ: We are going to go to Bob now.
MR. DIETERLE: I would like to thank the co-chairs and the subcommittee on
standards of the National Committee on Vital Health Statistics for the
opportunity to testify regarding the Electronic Submission Medical
Documentation, the ESMD initiative that is part of the CMS Office of Financial
Management Provider Compliance Group. Connie Leonard was supposed to be joining
me today. She’s the acting director of that group. She was delayed because of
the weather and the metro. She will not be available this afternoon.
Let me start by talking about— Medicare fee for service receives
roughly five million claims a day. Based on a 2013 audit conducted by the
Office of Financial Management, it is estimated that ten percent of those
claims are inappropriately paid. That amounts to about $36 billion per year. Of
that $36 billion, almost $22 billion is because of insufficient documentation
to justify the service that’s being delivered and $10.1 billion is due to that
service being medically unnecessary based on Medicare coverage policies.
The goals of the provider compliance group and ESMD program are to work to
minimize or prevent this improper payment by moving more of these improper
payment categories to prior authorization or pre-payment review. We’re also
concerned in the process of doing that about the impact on providers. We’re
hoping to minimize provider burden three different ways, by providing
electronic communication of medical documentation, by moving to structured
information for unstructured information to facilitate the review process and
move to digital signatures to establish data integrity, provenance of
information, and non-repudiation of signature.
It’s important to remember that under Medicare fee for service policies, the
provider is allowed to submit any documentation they deem is appropriate to
establish the service being proposed or that has been provided was medically
necessary and appropriate. Medicare fee for service has no ability to request
specific information only. They can request specific information but the
provider is free to submit whatever they wish.
We started about a year and a half ago looking at the consolidated CDA,
which Durwin has talked about, as the foundation for providing the structured
information for exchanging it. We started to create a couple of pilot projects
around that and immediately ran into a couple of interesting limitations. The
consolidated CDA documents only require a limited number of sections to be
present in the documents, the nine documents or the 14 documents that were
EHR vendors typically only include the required sections even though
information may exist in the medical record for the optional sections. Testing
and certification of the EHR vendor support of these standards is focused on
the required section and required elements. They do not test the ability of the
provider or the EHR to include optional elements. The consequence for providers
are interesting. It creates large variability in the implementation of
consolidated CDAs based on the particular vendor implementing it. It
significantly impacts the ability of a provider to submit documentation they
have gathered in documentation of a service they are either going to perform or
they have performed.
The consequences of that incomplete documentation are increase in denial
rates, because the documentation is not sufficient to justify the service,
force providers to move to unstructured documentation, therefore increasing the
cost and time for review, or requiring additional documentation to be
submitted. In all cases these will potentially increase the error rate and
ESMD initiative under the system interoperability framework as part of the
Office of the National Coordinator had an open forum to create a solution for
this problem. We created a set of documentation templates, which Durwin has
referred to as complete documentation templates, which are built entirely upon
the consolidated CDA release 2 templates. It adds five new templates at the
document level. It adds eight at the section level, four of which are actually
a highly constrained version of those that are already in the existing
It does not require providers to collect additional information. It does
ensure that the information they have collected is exchanged in these new
documents. IT does not impact commercial payers or providers ability to request
the existing documents in the consolidated CDA release two but rather provides
these for use when exchange of a more complete record is appropriate.
We have some questions that are frequently asked that we’ll just touch on a
couple of. First of all, will providers be required to use these complete
documentation templates to report to Medicare fee for service? The answer is
no. They may use any documentation method that is approved or will be approved
under the attachments rule. We will not request nor will we require them to
submit a complete documentation template. It’s there for their right to submit.
Second is are CDT documents significantly larger than consolidated CDA
documents? The answer is yes by about one to five percent. That is because of
the requirement to go and verify that with each of the sections you either
submit information or this an indication as to the information being
unavailable. Finally, will providers need to do additional work to document a
patient’s visit? The answer is no. They will document however they normally
document. This ensure that exchange can take place.
Secondly, EHR vendors can provide full support to automatically default
these indicators when information is not present. They know whether it exists
in the record or not, and the provider can make a decision in advance of
creating these documents whether they wish to report specific information at
any time, in other words information that is not applicable. We think that the
actual overhead of either creating the documents, or as we say here, digitally
signing will be absolutely minimal for the provider.
Finally the recommendations, we recommend that we delay until 2015 rule
making regarding attachments until we can see the impact of both the new
release of the consolidated CDA that Durwin referred to, and the impact in
production or in the actual pilot use of the complete documentation templates.
These will inform us on the rule making for attachments.
Secondly, any clinical or administrative content standards recommended for
inclusion in the attachments regulation must include full support for
providers’ rights to submit documentation under Medicare fee for service
policies. Third, it should include digital signatures to ensure data integrity,
provenance of data, and non-repudiation of signature. Finally, provide
flexibility in messaging format, message wrapping, transport, and standards to
ensure compatibility with meaningful use stage two and eventually stage three
regulations requiring EHRs to support, connect, and direct for the exchange of
clinical information. Thank you.
DR. SUAREZ: I think we have Gail next.
MS. KOCHER: Good afternoon. My name is Gail Kocher and I am
a Director in the National Programs for the Blue Cross Blue Shield Association.
BCBSA is a national federation of 37 independent, community based and locally
operated Blue Cross and Blue Shield companies, or plans, that collectively
provide healthcare coverage for 100 million members, one in three Americans. On
behalf of BCBSA and our member plans, I would like to thank you for the
opportunity to provide our perspective on attachments.
While attachments are ultimately a local Plan business decision, our
comments provided in response to the questions do reflect a
representative view of all of our Plans. As we have testified before the
Subcommittee previously on attachments, today I would like to focus on the
question around clinical and administrative data exchange to drive quality and
First and foremost, we do 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. We did have
a list of six recommendations in our written testimony. In the interest of
time, I’m only going to call out two verbally today.
We would continue to recommend that there is a staggered implementation of
attachments for all other uses after the claim, such as referral and prior
authorization and other business purposes to limit the operational overload.
Standards and protocols and rules for health data exchange should be fully open
and supportive of data portability and interoperability.
The larger issue is the huge volume of systems related mandates and the
profusion of other requirements, as a result of the HIPAA and the Affordable
Care Act bearing down on not only on our plans but on providers and other
trading partners as well. Therefore, we continue to see the need for a
strategic roadmap to balance all the coming mandates and ensure a smooth and
Our industry is at a point where the exchange of both administrative and
clinical data is critical to driving towards quality and cost improvement. As
part of this, the industry is moving towards different provider relationships
where everything is patient centric and the provider needs more data to manage
care and engage the patient. As part of reaching this goal, the exchange of
administrative and clinical data is new to most payers and introduces a variety
of concepts around the data exchange, which is key to successful implementation
of quality and cost improvement programs.
It is important to consider the administrative impacts and burdens of data
exchange to both payers and providers. The need for data must balance the
requirements under HIPAA for minimum necessary documentation and privacy and
security. Examples of newer, innovative programs are coordinated care models
such as Patient Centered Medical Homes or Accountable Care Organizations which
protect our members through a safe, affordable and quality driven care
Data exchange between our plans and the PCMHs and ACOs is at the core of
these models, enabling physicians and hospitals in a wide range of
capabilities, including medication management, identifying gaps in care,
clinical decision support, disease registries and reminder systems. Clinical
data such as pre service, admissions, discharge notifications along with case
management and disease management notifications, is needed by the provider to
whom a member is attributed when other providers are involved, in order for the
provider to coordinate the member‘s total care.
Care coordination member data includes information standard to the exchange
of pre service, admission and discharge notifications, such as member
demographic data, diagnostic and procedure data, care dates and authorization
information when applicable. This exchange of data enables a member‘s PCMH or ACO to continue to better coordinate care when the member
receives services outside of their attributed arrangement.
PCMH models rely on a team coordinated by a primary care physician that
takes collective responsibility for patient care, and when appropriate,
arranges for care with other qualified physicians as defined within the health
plan‘s program. The patient has an ongoing relationship with
the PCP. This offers patients accessible, continuous, coordinated, and
comprehensive patient centered care.
An ACO is a group of healthcare providers that agree to
deliver coordinated care and meet performance benchmarks for quality and
affordability in order to manage the total cost of care for their patient
populations. ACOs are typically, but not universally, hospital based. These
models rely on the exchange of patient data, both the administrative and
clinical. BCBSA member plans support these models by enabling clinical data
exchange of relevant member personal and health data information. The
information is made accessible at the times and places where clinical decisions
will be or are likely to be made. This timely exchange helps clinicians,
patients and payers make the best possible clinical and administrative
decisions. By supporting providers with a meaningful exchange of data, all
stakeholders become more accountable stewards for the quality and safety and
bring greater value to the healthcare system.
BCBSA supports the adoption of standards and operating rules for healthcare
attachments. We recognize their value in achieving the overall goal of quality
and affordable healthcare. Affordability and quality necessitates the exchange
of patient information. It enables providers to have a 360 degree patient view
and allows our plans to conduct predictive modeling and identify gaps in care.
This data exchange is a value to our industry but collectively we need to
proceed with care and caution to the end goal of improving population health.
The barriers should not prevent forward movement toward the ultimate goal.
Given the number of mandates with an implementation date in 2016, we
continue to encourage CMS to consult the NCVHS to develop a strategic road map
for administrative simplification provision implementations. This road map
should balance all mandates from the ACA, not just the administrative
simplification provisions, along with other ARRA/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 road map. We appreciate the opportunity to testify, and I would be happy to
answer any questions.
DR. SUAREZ: Thank you, Gail. We’re next going to Don.
MR. ST. JACQUES: Walter, thank you very much for the opportunity to speak
with you all this afternoon. I am Don St. Jacques, senior vice
president of business development for Jopari Solutions. On behalf of Jopari and
certainly the stakeholders who we represent, we’d like to thank the
subcommittee for this chance to spend some time with you this afternoon to
discuss attachments. These are certainly some very important hearings, and we
believe that it is in everyone’s interest right now to make sure that what
we’re doing perpetuates the existing and allows us to move forward into
Jopari is going to bring to you this afternoon a little information about
how we’ve been dealing with attachments in our industry, the property and
casualty industry for the past seven years. We’d like to thank an recognize the
WEDI co-chairs for the property and casualty workgroup, that being Tina Greene
from Mitchell International, Tammy Banks from Optum, and Sherry Wilson from
Jopari for their contribution and their collaboration with this presentation.
A quick bit of information about Jopari for those of you who may not know
who we are, we primarily service the property and casualty industry even though
we do have some involvement in the group and commercial world. We primarily are
moving between providers and payers what would be viewed as the typical
clearing house transactions, bills, acknowledgements, remittances. One of the
areas that makes property casualty a little bit more difficult is the fact of
the burdensome area of required documentation, which has been there from the
One of the things that’s important to know about Jopari right now is that we
are processing over a billion attachment transactions a month. Those are all
shapes, sizes, and formats. I’ll talk a little bit more about that here
shortly. We also are very actively involved with all of the groups, whether it
be HL7, whether it be HIMMS, whether it be Cooperative Exchange, ASC X12,
IAIABC, WEDI, all of those groups happen to be those that we make sure we spend
time with, because again representing the property and casualty industry which
has always been viewed as a tangential portion of the healthcare delivery
system certainly is getting a lot more attention.
Since 2008, the IAIABC has been putting together standards for attachments,
the standards as it relates to what was currently available. The attachment
issues as it relates to the property and casualty world is really specific
around the fact that those attachments are used not only for medical
determination, whether or not that treatment is related to the injury, but also
many times the determination of the compensability of the claim, the legal
component of that. With that, what we’ve seen is there have been a significant
number of developments on a state by state basis as it relates to attachments.
Part of that evolution is the fact that we now have a growing number of
states that do have attachment specifications, required attachments, attachment
types. They could be anywhere from a form to specific documentation to just a
recommendation based on a procedure or a certain other type of treatment,
documentation must be provided to a payer in order for that claim or that bill
to be processed.
But one of the things that’s been very interesting in our world is there has
been great support by a number of stakeholders that you normally would find
doing the processing group and commercial claims. We’ve identified a few of
those folks on the screen, but people such as Emdeon, Availity, and ZirMed, and
SSI, and Optum, Passport, Athena, Practice Insight, Capario, and many others
who have supported this initiative by enabling their customers to be able to
utilize documentation tools that they may already have embedded in their
The state specific rules as it relates to attachments includes such things
as the front end edits to ensure that what’s coming through is in the PWK or
there could be a mutually agreeable format, rules as it relates to missing
documentation, how does a payer handle that when a claim is presented in
documentation that has not been provided. The appropriate acknowledgements to
make sure that the provider realizes they know that the claim has made it to
the payer, whether or not there’s documentation required, whether or not that
documentation has been satisfied, whether or not that claim has been accepted.
Much of that is being handled by 277.
There’s also attachment header requirements so that the appropriate
documentation has been submitted, can be linked to the claim, as well as making
sure that there’s an opportunity in the event they can’t use the PWK for some
reason that there’s a naming convention that can be created. Much of that
aligned with the HL7 and X12 departments. There’s also the standards of HIPAA
privacy and security that are now overlaid in the property and casualty world.
In the message content, about 90 percent of this is unsolicited. It’s not
only the state redefined attachments but forms. It’s also that right now we are
working very closely with IAIABC and HL7 to come up with some P&C report
types, because again we bring a whole myriad of different types of
Currently the use by the payer in the property and casualty world to request
additional documentation is handled in the 835 with a CARC or RARC code
combination to request that documentation. Going forward the IAIABC and the
industry want to align with the HIPAA standards to ensure that we are all able
to utilize the existing technologies that have currently been deployed as well
as staying in alignment with the larger group or commercial world.
What’s very important for us to be able to represent to you is there has
been significant return on investment for participants in this process. We’ve
seen where anywhere from the provider is seeing a reduction of 60 days on a
turn cycle for payments down to as much as— as little as 8-10 days. We’ve
seen a significant improvement as it relates to payers being able to better
expedite treatment based on the fact that they have more timely delivery of
medical care. Payers are now reporting anywhere from a 15-30 percent
administrative savings simply because of the fact that they’re doing
attachments, or providers seeing a 75 percent increase in their first time
claim acceptance. Many of these facts probably align with what many of you have
been thinking about how attachments may affect your industries.
From our recommendations standpoint, it’s really very simple. We think we
need to maintain a flexible approach. Certainly the X12 275 has been utilized.
We also align with the HL7, but we believe this will allow for across lines
coordination. This approach would allow for all lines of business. We also
believe that we should not have just a single CDA format, that we need to get
some flexibility. We need to be able to have agonistic methods to transport
documentation. We also need to have a tremendous amount of education. One of
the things that we’ve found over our seven years is that education is key to
the ability to utilize documentation properly and for providers to be able to
properly submit to the payer.
With that, we know that going forward states are going to continue to adopt.
Again, we’re going to be working very diligently with those folks to make sure
that we stay in alignment with any HIPAA standards as we come along. We are
strongly recommending to our stakeholders that we want to be able to support a
single work flow. Providers should be able to use their readily deployed
technology to be able to handle all lines of business, not to continue to have
one-offs. We certainly encourage the NCVHS and HHS to develop EDI transaction
standards that will again support end to end processing, not one-offs. With
that, I’ll turn it back to you, Walter.
DR. SUAREZ: Thanks Don, we’re going to go to Tim next.
MR. MCMULLEN: Thank you, Walter. I am Tim
McMullen, executive director for the Cooperative Exchange. I have on the phone
our vice president, Mary Hyland, who’s going to also participate in this
testimony. I want to thank NCVHS for inviting us to participate. Cooperative
Exchange is a recognized resource for the clearinghouse industry. We currently
have 24 clearinghouse members making up 90 percent of the claims that go
through the healthcare system today. We also have some other non-profit members
such as the AMA, HBMA, ACS X12, and also a memorandum of understanding with
WIDI, so we get a good cross section amongst our membership.
With regard to setting standards for our healthcare attachment transactions,
the clearinghouse industry has two issues to bring to the attention to NCVHS.
The first, as has been said before, and in fact, I was happy to see Robert say
that the CCDA is not necessarily the end all, be all, is that the electronic
exchange of data needs to remain flexible, as Don was saying.
The electronic exchange of data between the provider and the payer is an
established process using trade or partner agreements to manage the exchange of
ACS X12 275 transactions. Additional information to support a healthcare claim
or encounter transaction can be set with the embedded HL7 CCDA, sending that
electronically back to the payer. Clearinghouses currently utilize other
methods to envelope and transport the attachment information. We believe that
these options should continue for now and left for consideration in future
regulations. In other words, it’s important to allow different levels of data
based on the business need. As Don was saying, the property and casualty
community has adopted 275, but also allows for flexibility as well.
When we’re talking about if you’re going to be forced to have one standard
for clinical data versus administrative data, I look to the AMA and in the fact
that their providers would have to create a dual process here for attachments
and doubling their work efforts. I just wanted to bring that to the attention.
Mary, do you have anything to add?
MS. HYLAND: No, I think you and Don explicitly stated the direction that we
want to go. That flexibility is crucial as we move forward. The existing
protocols that have been established for many years with payers in the industry
regarding the attachment process allows the providers to accommodate and send a
jpeg or send a pdf or tell us what they need to send, and we put it in the
format that needs to be sent through this coordination of activity, so that’s
MR. MCMULLEN: The second thing I wanted to bring to your attention to, we’ve
discussed this a little bit before with Durwin’s testimony, is the requirement
to capture null flavor values. This creates potential issues of inappropriate
capture of the null flavor values is associated with attributes of partially
known data items. Under the complete document template, the CDT, essentially
all software which processes the data has to be null value aware. That makes no
assumptions whether a particular data instance is valid or not. The CDT
standard requires all information be completed and uses null flavor values to
help accomplish this.
To sort of explain more on the null flavor value and why we’re concerned
about it is when the data is not being submitted, when the data is not being
submitted, the provider has to indicate there is no information,
non-applicable, or some situation where the provider can specify the patient
was not asked, the patient was asked but didn’t know, or the information was
masked for the patient’s privacy. This is a lot of data— if you don’t need
this information to adjudicate a claim, then the information should not be
For clearinghouses and providers to be required to send a tag saying I’m not
sending you the information unnecessarily increases the size of the
transmission file. Keeping and storing of these null flavor values creates
unnecessary hard drive or cloud volume. Plus, when running analytics for
clients, clearinghouses have to take the added step of excluding that
information. The standards should be set without requiring null flavor values,
which isn’t really a word. With the increased size of the attachment due to the
null flavor values, this creates the potential of the attachment being sent as
a pdf, reducing attachments to nothing more than electronic faxing, and
historically we’ve seen that if you allow these defaults, they’ll be used way
too often, rendering the information less effective or useless.
MS. HYLAND: Just to add too, just regarding the comments regarding the size
and volume of information that’s being collected, when you’re collecting the
information that’s not necessary, of course that’s relating to non-observance
of the minimum necessary rules. As clearinghouses we transmit the information
that’s being sent to us by those providers to the payers, but we also want to
ensure that only the minimum necessary information needed to adjudicate that
claim is sent. We have to maintain our processes, and we also have to consider
if a provider is undergoing RAC audit, that we are able to also demonstrate our
compliance and adherence to the minimum necessary rule as well. We want to
ensure that in conjunction with providers’ needs.
MR. MCMULLEN: Thank you Mary, I see I’m flashing red, so let me finish this
up very quickly. The Cooperative Exchange members support the use of attachment
standards for functions in addition to the need of claim payments. These same
attachment types can support prior authorization and post-pay. Based upon the
provider’s business needs today, options on how to exchange attachments and
clinical information needs to continue to be coordinated between the trading
partners. I was pleased to hear Denise this morning say that CORE is taking a
very measured approach to putting in operating rules and standards for
attachments. Therefore, it’s important that NCVHS does not disrupt the current
One more point, as Larry and Todd spoke of earlier with the EHR, with
development of EHR technology, the availability of software to providers large
and small to produce and access many of these clinical documents is becoming
more common place and necessary with meaningful use requirements. This
increased participation of exchanging these documents using health information
exchanges and web portals will also provide another method for these documents
to be exchanged amongst trading partners.
Moving forward, the industry should carefully consider how best to ensure
that the process between operating rules and standards provides the most ROI
and industry structures speak to the evolving landscape. The property and
casualty community has adopted 275 already. In closing, flexibility good, null
flavor values bad, measured approach to adopting the standards good. If you
have any more questions, I’d be happy to answer.
DR. SUAREZ: We are going to go next to Geoff.
MR. PALKA: I am Geoff with Epic. We make software primarily
for medical groups in hospitals, both on the clinical side as well as revenue
and access and also a bit of managed care functionality. First, thank you very
much for inviting me to participate in today’s discussion. I think the
electronic exchange of key clinical data is an incredible opportunity to both
cut costs and improve patient care. This committee’s work towards
standardization is vital for allowing that to progress.
I’d like to start at the end with the last question and talk through two
brief examples where successful exchange is having a big impact on transforming
the patient experience and with it the quality and cost of care. Many of the
clinical data exchanges we see today occur between providers. Messages
accompanying referrals and planned transitions of care can ensure your medical
record stays with you.
For unplanned care, as someone with a medical allergy, knowing that an ED
clinician can pull data from my record back home is a pretty big deal. On a
more traditionally administrative end, several organizations are now leveraging
direct connect through the health exchange to facilitate electronic disability
claims processing with the social security administration among others. This
dramatically accelerates the decision process benefiting providers, patients,
and the administration, and the ROI that they’ve shown is simply incredible.
Taking a step back from the examples, I think the convergence term from the
letter that you all wrote last year, summarizes our environment pretty well.
Emphasis on population health requires blurring the lines between the
administrative and the clinical. This convergence relies on interfaces and
standards supporting the business practice in between the providers and the
As a developer, I’m nervous about attachments, not because the content is
wrong. I actually feel the specific items— most of the points recommended
in the 2013 letter seem appropriate. I agree with the proposed standards. I’m
very supportive of having the CORE CCDA content with an X12 envelope. The
structured data is a good thing. I would agree the null values scare me. I’m
not sure how we would implement that. That’s not the problem. I think what
concerns me is the uncertainty in the area has a paralyzing effect, especially
knowing that a regulation or rule is forthcoming. There’s a huge disincentive
for me to allocate resources for my team to any specific changes.
We’ve seen in this industry, especially recently, that waiting pays. Waiting
on 5010 and meaningful use, and ICD-10, pays. Even the fact that the CMS pilots
didn’t use the 275, on one hand it’s great that they’re moving ahead, and I’m
really excited about that. AT the same time it’s hard not to see that and have
the reaction of gee, thank goodness I hadn’t invested heavily in the 275 at
that point. Just to be clear, we’re still going ahead with the attachments. I
think for our organization clinical and financial integration and
interoperability are really fundamental core values that we pride ourselves on.
For us and our provider base, we’re going to be ready, but obviously with
interfaces it’s only valuable when there’s widespread adoption.
Realistically at 18 months out from January of 2016, it’s hard to see where
we can go now without a rule or a standard to widespread production. I think we
need lead time to be able to develop functionality, to deploy it, and for our
providers to be able to build, test internally, test externally, do pilots, all
that. I do think that a phased approach is going to be critical.
At the same time I realize— I think, maybe I hope— that January
2016 is a hard date. I do think that’s a good thing because in my interactions
with our organizations with— I work with our third party group and with
our regulatory group— we’re also hearing a strong up tic in work a-rounds.
That convergence has happened. Payment models are changing. To be able the
population, to be able to manage care from a payer’s side, people are realizing
they need the clinical data. On the provider’s side they need a tighter
relationship with their payers. They’re finding ways to get it.
As an EDI guy, portal is sometimes a four letter word. I cringe when I hear
that. It’s right. That’s happening. I fear that sometimes the more investment
that’s going into things like that, to individual sites, to work arounds that
are different by the major players, the slower the alternatives will catch on,
and the more that fragmentation can become entrenched. I do think we need a
message. We need a message that’s clear so that vendors can start developing
and providers can start planning.
Overall, I unfortunately— I’m jealous of your summary, Tim, because you
summarized it incredibly well, and I’m not nearly as good at following up the
key points, but I think the key thing for me is that I do see that January
2016— I think it is important. I don’t know that we can afford to delay. I
think we need to have ways of getting clinical data and administrative data in
sync. I think we need to get something out there. I also think with the
unreasonably short lead time we’re going to have to be flexible in the adoption
and flexible in phasing it in. I feel it’s important, and hopefully this
committee can help with this, but I think we really need to make it as clear as
possible as definite and transparent as possible what we’re going to be doing
with these attachments as quickly as we can.
At the end of the day, being a software vendor, I can’t program in something
until I know what it is. I think we have some pretty good hints, and I think
we’ve got some standards which fortunately with CCDA and things like that being
part of meaningful use, being part of other adoption and part of other things
that our organizations work with, that helps a lot because that’s not starting
from scratch. That’s technology that’s there. At the end of the day, being able
to really design in a thoughtful way means needing a little bit at least of the
time in advance.
I do think that the silver lining here is— I think the potential here
is incredible. I think that the advantage is— it’s got the potential to be
a win-win. It helps on both sides, and it has a dramatic impact on cost from
saving stamps and from coordinating care, which ultimately helps everyone. I
think as long as we can get a clear standard, I don’t think we’re going to have
as many problems with adoption. I think there’s going to be a strong drive to
get to a point where we can use that standard effectively.
DR. SUAREZ: Thank you very much. Thanks everyone for this incredible tour de
force on the current status of attachments standards. We’re going to start with
some questions and some dialogue. We have a number of minutes. I know we’re a
little behind, but we’re going to catch up on the back end. Linda, go ahead.
MS. KLOSS: Could we return to the issue of testing? I think probably in no
area is the need for real on the ground tests, as important with claims
attachment, and go back to what the nature of the testing is that’s going on
now with the DTSU. Where can we extend that in— really in the claims
realm, not just the exchange of electronic document types our templates?
MR. QUINN: I could speak to the clinical side. I can speak to giving it to
X12. I can’t speak too much to what happens beyond that. The process we’ve
taken inside of HL7 is there’s essentially almost an infinite cycle of balance
that can occur with constant creep in change of scope as you go through the
balance cycles. On a number of fronts, but certainly CCDA is one of the large
funds, something called, Fires, another area, where we’ve basically said to the
groups like structured documents, like attachments, et cetera, you need to
basically define something that you want released as a test version. You need
to find supporters of that test version. They have to agree at least in
writing, nothing I could sue them over, that in fact they will, how they’re
going to test what the draft standard.
In the meantime, while the draft standard is being tested, new things are
being added to the foundation that it came from, in expanding the standard. I
can’t stop progress, right? You end up with this cycle where once a version is
being used as a draft standard, for testing.
At some point we then come back, and these are contracted one year or two
year cycles, we come back to them and say, okay, it’s time for two things to
happen. One, are you ready to run this now through a normative ballot, which is
effectively the gold standard for saying, okay, we’ve done all we can in the
SDO. It’s now up to the industry to actually figure out where the strong points
and the weak points are, and take the new stuff that you’ve been working on and
put that into a DSTU of a one or two year cycle.
These are two areas that are fairly visible where we’ve done this. It’s
happening through a lot of different areas in HL7. The last time I checked it
was 55 workgroups, and anyone who could be doing that.
That’s the best I can do within the confines of being in the SDO. When I
have partners that are large medical institutions that are doing the testing, I
place a lot of faith in them, but then again, this is their business, whereas
developing the standard and making sure it gets out and published is mine.
MS. KLOSS: Just to clarify, once the standard is an adopted standard, I t
would still need to be tested in this particular claims attachment use case.
MR. QUINN: Absolutely, and then we have other forms. If we
do find errata, things like typos. A typo could be 180 degrees wrong. Make the
reading of the standard wrong. When these are found, then those updates go out
as a Errata Notification under my signature.
DR. SUAREZ: Any other comments on the testing question?
MS. GOSS: I heard a lot of objections to the null flavored value and whether
or not that actually was a true word or not, but the null flavored value —
I imagine it emerged because it’s better to say I don’t have this or I can’t
give this to you, than to just have an empty segment that gets passed along. I
noticed Tim, that had a lot of concern around this. From a data capturing
perspective and that translates for me into provider workflows and complexities
that they have, which then impacts the EHR vendor products and has a whole
bunch of downstream stuff.
I didn’t hear any alternative. Typically when stuff gets added like a null
value it’s because we want to affirmatively say, I’m not giving this to you out
of conscious choice, for some reason, and so don’t think it’s just missing.
Don’t kick out my transaction that I want you to process because you don’t have
this data. There must have been a really strong reason in the standards
community for that to get included. I’m curious as to the attention related to
this topic. That’s an open ended question to all those who look interested in
MR. MCMULLEN: Since we brought it up, I am going to leave it put to Mary
Hyland to answer that question. I also have Deb Meisner with Emdeon, who’s also
a member, if she would like to answer that as well. I’ll pass it over, what
would the alternative be if we didn’t have null flavor values.
MS. HYLAND: Well I believe it goes back to the actual request of the
information. That’s what we were objecting to. If the information is not
needed, then it should not be requested. The alternatives of inserting null
flavor values in the information then also circumvents the transaction even
further if the information was not collected.
What we were objecting to was never one, that the committee actually
requested all this information when it was not needed. I think it all drives
people back to that versus the null flavor value, in my opinion.
MS. GOSS: I am sorry Mary. I want to interrupt you because
typically in the standards community if you don’t have a good business
justification no one is going to get it included. You’re not going to pass
muster in the workgroups. Maybe that’s where we should start the question.
What’s the reason, and I’m going to look to Durwin or Debbie to help me
understand what transpired in the committees that made this such an
MS. MEISNER: I’ll leave it to Durwin to speak to it. This is Debbie Meisner
with Emdeon. Our concern at the workgroup level is when you’re doing XML tags
they’re considerably large, and you’re going to have to put the tag before and
after to say I don’t have the information. When you’re doing one or two of
these exchanges that’s not a big deal, but when you’re talking about
clearinghouses, which is what Tim is representing here, the problem with that
is you take that and say okay, on the two million claims I get a day, how many
of them are going to have attachments, and what does that exponentially do to
the size of this file that I now have to deal with, number one?
It’s also been our experience as soon as you give a default value to folks
to say, I don’t have the information, that’s what you’re going to get 99
percent of the time, is a default value. We’ve learned that over the years and
have gotten away from doing defaults. I’d rather you not send it than to give
me a default.
Those were some of the issues, the size, the capturing of it, how do I get
rid of it if I’m doing analytics, writing all this code around supporting the
fact that you just didn’t have the information to send?
MR. QUINN: This is an area where— I am an electrical engineer. I just
happen to have worked in the computer science side of healthcare for almost my
entire career, which has caused me to be wishing that I could get an MD, PhD by
osmosis from all of the time I have spent with some of the most brilliant
informaticians, probably in the country.
All I know is that when this topic comes up, I get some really strong
indications from physicians that this endangers the life of the patient, that
they’re not documenting what they need to know in the case of the negatives.
Any one of them, Stan Huff, Chris Shoot(?), Clem McDonalds, Chuck Jaffe, even
Ed Hammond, who’s not an MD, can go through a long list of things where I
understand I don’t want my record to be documented with a shortcut for
something that needed to be documented.
MS. GOSS: This has to do with a provider’s choice of getting as much robust
data captured and being able to be transmitted for whatever business
MR. QUINN: For whatever purpose. Now, if you want to add a filter at the end
where it says, we’re going for payment, this is not a clinical referral. I’m
not sending you to a surgeon, we’re sending this for payment, and I want to
have a different set of notes to go along with that. I can feel a little more
comfortable about that, but sure as heck if it’s in the EHR, the part where I’m
working in, I’m looking and saying whatever we need for patient safety.
MS. GOSS: So part of the tension here is clinical treatment versus
MS. KLOSS: I think it is important to remember that these are document
types. If you define the content of a complete history and physical, it
includes both the null values as well as the information that you have. I think
you have to think about this as not the whole record but document.
MR. QUINN: It seems a lot of focus is on history, taking history, when it
has to do with things you could have done in the past that’s going to shorten
the probability that you’re going to live longer in the future.
MS. GOSS: But when I start to look at what Gail talked about, and I think
you’re right on the money when you talk about the ACO environment and the data
analytics, it’s sort of analogous to the acknowledgements. Do you want to know
it really got there or not? It’s a philosophical debate is what I’m hearing,
depending on what the business need is.
MR. SOONTHORNSIMA: Walter, can I chime in real quick.
DR. SUAREZ: Ob, actually if you don‘t mind, Bob is going to
try to comment on this part, because he’s very much involved in that part, and
then we’ll go to you, Ob.
MR. DIETERLE: Let me make three different comments on this.
First, null values are part of the underlying standard. Whether you like them
or not, they’re there, and you’ll have to use them. They will occur, and they
will occur with all of the existing templates because they can all use a null
value. It’s part of the model. That aside, that’s the underlying
The reason we included the ability to specify sections and entry level
templates that were more highly constrained in the complete documentation
templates, is that we wanted to ensure that we were not creating an environment
in which a provider was required to collect information that they would not
normally have collected, but rather they can have it default to saying NI, I
have no information, or if they chose not to share it on a regular basis they
can default it to NA, it’s not applicable.
Those are the only two, by the way, that we are continuing to support in
this. None of the other null flavors pass muster in the balloting and the
review and the dispositions. Those are the two standards that would be there.
That way when a provider submits documentation under one of these
templates— and oh by the way, they don’t have to use them, to be very
clear — they can use the H&P from the consolidated CDA or they can use
the progress notebook from the consolidated CVA, and whatever the constraint
requirements are, they use those.
If they need to report more information, they would use these, and that’s
the only reason they would use these. If they do, the null flavors allow them
to specify why the information is not included. By the way we do it in every
other standard everywhere in exchange, we have a way of saying this is required
but it’s not there.
In HL7 2.x we call it RE, required but empty. We don’t have the equivalent
in HL 7 version three. If it’s gone, you have no idea whether the EHR
technology didn’t support it, whether they didn’t collect it, whether —
you just have no idea. It doesn’t matter. You can’t tell.
This allows us to have something that allows us as a recipient of the
document to understand whether or not it’s worthwhile asking for additional
information because if everything that was there was either included or NI,
there’s nothing to ask for. It doesn’t exist. Yes, null flavors are very
valuable in doing it. Yes, they had a minor amount of overhead. We calculate it
to be roughly one to five percent of the actual populated transaction.
I don’t think it’s a huge burden on the clearinghouses to add that extra one
to three percent, and by the way, having structured data versus unstructured
data is about a 90 percent reduction in bulk. The fact that I can express
everything that I need to in a structured fashion, including null flavors,
means I don’t have to send unstructured data, which is ten times more
We had some real reasons for doing this. They may not be well understood,
and we realize there’s a lot of discussion going on, but nonetheless that’s
what we did when we took on this project to ensure the providers had the right
utility to exercise their right under Medicare fee-for-service national and
local coverage determination policies. That is the only reason it was done.
DR. SUAREZ: I think we have Ob now on the phone. Ob, are you still on the
MR. SOONTHORNSIMA: I want to reflect on some of the conversations, get some
feedback from the disciplines. The last speaker talked about convergence, and I
think that really touched a chord, and a couple of colleagues chimed in as
If you really step back and look at this whole attachment conversation, I
think overall there are two goals that I’m not sure are necessarily aligned.
One goal is really around process and admin simplification. The second may not
be clearly stated, but to me it’s still a goal, is population health and
advancement in healthcare analytics.
Some of you already talked about ACO and convergence, and that’s where I
think there’s an opportunity for standard development organizations and operate
rules author to try to come up with other specific use cases that could advance
both areas in terms of the process and the admin simplifications as well as
I’d like to ask the question of the panel, or anybody in the room, if we
clearly identify these standards and use cases such an advanced — whether
it’s admin simp or population health, where the data could be exchanged in
these standard formats, that could serve both purposes. Otherwise, I agree with
the last speaker who mentioned payers and providers are already defining ways
to exchange data waiting for standards or rules to be finalized.
DR. SUAREZ: Who want to address Ob’s question?
MR. SOONTHORNSIMA: Again the question is on the specific use cases that
clearly identify opportunities to align both admin simplification, as well as
population health, data exchange as far as population health.
MR. PALKA: I do think there’s a lot of overlap, and I do think part of the
reason for that today is that for better or worse the claims or the
fee-for-service claims are one of the main channels of information between the
payers and the providers. I think some of what we see as attachments requested,
either when claims are pending or after denials or requests for additional
information, is because that is a line of communication and that is a point as
which as a payer who now increasingly, and I don’t mean to cast aspersions, but
I think increasingly it seems, I’m very vested in making sure my patients are
having healthy choices. If they need a preventive care treatment, we have
payers coming to us saying, how do I get an alert to your providers that says
do this additional thing that’s going to cost me money because it’s preventive
and I’m going to avoid more money later on.
As payers are looking at that and saying wait a minute, to do my job of
managing risk, I need to also manage the patient’s well-being, they’re saying
how do I get that from providers? I think some of where they’re looking to
break through the barriers — I think some groups have better relationships
than others, but there’s a lot of distrust out there. The claim is one point at
which they know that people are going to come to the table because they need to
get paid. I think that’s where we see some of the agreements evolving out. I
think there are certainly organizations that have tighter relationships and
exchange a lot more often.
I do think that from a standards perspective a lot of what we would need to
support claim payment would be a subset of what you really need for clinical
care. I do think that the same message formats certainly seem like they could
accommodate the same types of workflows. I think that’s partly where we hear
some of the clinical feeding into the administrative or vice versa.
MR. SOONTHORNSIMA: Thank you.
DR. SUAREZ: Okay, Larry go ahead.
DR. GREEN: I have a yes or no question. We should do it fast. What, if
anything, is the conversation going on in setting standards for attachments in
terms of assuming whether or not patients can be a source of the information in
the attachment? Is there something going on, yes or no?
MR. QUINN: Discussion, but I’ve heard no decisions.
MR. PALKA: There’s discussion around how to incorporate patient-reported
outcomes and patient-reported information into the health record. As that’s
incorporated into the health record, it would then be available for things like
attachments. If I patient-report my medical history and then let’s say a
provider — I think we often hear they’re not immediately accepting it, but
they want to review it with me, and so I input it.
When they review it they say, I see your dad had a heart attack or whatever,
then the hit verified whatever it is, it’s in the record. If there’s a medical
history of me sent out to support payment of a claim that would be part of that
then. I think that’s part of how at least right now we’ve seen it happening.
MR. DIETERLE: There’s an S&I effort underway looking at the provenance
of information, including patient reported information, tracking its point of
origins through whatever additional intermediaries are holding it and passing
it on. What that does it allows us to ensure that when it’s incorporated to
something like a consolidated CDA, we can separate the origin of the
information so we can decide what is appropriate in each setting in which that
information might be used. There is work going on. It’s not create new
standards for it, but to figure out how to use existing standards to document
the source of information and what has happened to it since it was created.
MS. KLOSS: I just want to go back to a topic that Mary introduced and just
for the record remind us that the last time we talked about this topic of
claims attachment we did bring up the issue of minimum necessary and the need
for guidelines to that effect in the claims use case. I think I’d just throw
out the question has any more work been done on that sort of guidance, or is
that something that our committee needs to again revisit?
MR. QUINN: It is one of these topics that’s gets discussed a lot. Especially
from my perspective when I talk to a payer, what information do you need, what
information do you want? What you’re doing is you’re turning the table upside
down, in a sense. Right now, it’s very expensive to ask for additional
information. Payers tend to ask for the minimum amount of information they need
for the job at hand. We’re going to make it very easy for them to have all the
I’m not saying they should have all the information, but from a technology
perspective we’re making it available. Somebody’s got to come up — I don’t
know if it’s the people around this table or where, but somewhere you have to
at least recognize that there’s been a mechanism that has kept the request for
additional information to a minimum because it costs so much money to get it.
That will be removed once we implement attachments.
MS. KLOSS: We have a stewardship obligation.
MR. DIETERLE: I would argue that the issue is going to be the appropriate
stewardship of received information, making sure that it is not used for
purposes other than for which it was solicited. We deal with this today. This
is not a new and emerging problem. When we request an H&P we may get an
entire encounter printed and sent to us. Well, we’ll have the same opportunity
electronically, whether it’s in an unstructured or a structured document. The
problem is protecting the information from additional use and disclosure, not
in trying to find artificial ways to limit what the provider may send.
MS. KOCHER: I would say that our concern would be around the burden of
sending more data than is needed both to the burden to our plans who then have
to capture, store, maintain, et cetera, the additional— have the privacy
and security, but there’s also the burden that we have a concern on the
provider who is on the hook for documenting that what they sent met the minimum
necessary. I think we would agree that more discussion needs to happen. I don’t
think any of us sitting at least on the panel are the ones that can ultimately
I think it’s a collective conversation with providers. I think it’s a
collective conversation as we look at the bigger continuum. Data isn’t just for
claims adjudication. There is the population health, the care coordination. We
really have to step back and look at it more strategically but at the same time
ensure that the burdens are as minimal as possible on all the applicable
DR. SUAREZ: Thank you. Alright, I think we are going to stop here. I really
appreciate all the comments. We do have a lot of things to think about. We
certainly have issued a letter, as you all know, recommending the adoption of
the standard. We have heard today a number of comments about advances and
improvements and changes in those standards. We’re going to have to think about
what they imply and what they mean, and then we’re going to certainly be
working with CMS with respect to what that would entail with this
recommendation about the centers.
Thank you very much again. We’ll certainly be in touch with you all in the
near future if we need more information about your testimony. For the members
we’re going to take a 40-minute lunch break. We’re going to try to come back
here at 1:45— that would be a 35-minute break, but if you can try to make
it back at 1:45, we’d really appreciate it. We want to try to catch up on the
back end some of the time. Thank you.
A F T E R N O O N S E S S I O N
DR. SUAREZ: I think we are ready to get started. I think we have all of our
testifiers for our next session. We are going to go ahead and go into the UDI
This particular session is also a very important session that we wanted to
bring back. There’s been a number of new, important advances related to the use
of UDI in administrative transactions. We want to bring all those to the
attention of the committee and have a discussion about those.
We are going to start with just an overview of where things are from FDA’s
perspective, and then we go to the other testifiers related to this topic. Tom?
MR. GROSS: Good afternoon. I am Tom Gross. I am the director of the Office
of Surveillance and Biometrics at the Center for Devices and Radiological
Health at the FDA. I thank the committee very much for offering the time to
speak on this important issue, i.e. the use of Unique Device Identification in
Now to begin with, I would like to provide some context. In September of
2012, FDA published our white paper entitled, Strengthening Our National System
for Medical Device Post-Market Surveillance. This was followed up in April 2013
with our update, Next Steps, which we find our thinking regarding a more
integrated national system.
Both papers laid out our vision for a national system, touched upon the
current tools that we use for post-market surveillance, and identified four
initiatives that we think will help develop a much more robust national system.
Those four initiatives are listed in this slide. I have highlighted the first
one, which is of the most importance to this committee. That is to establish a
UDI system and promote the incorporation of UDI into electronic health
information. By EHI, we mean data sources such as electronic health records,
registries and certainly claims data.
Now, this graphic is taken from the white paper. It illustrates various
components of our national system. From 3:00 to 9:00 are represented our
current post-market tools. We included an icon at 10:00 on an administrative
and claims data to underscore the fact that we think that this data source is
important to developing a robust national post-market surveillance system.
Let’s talk briefly about the purpose, value and benefits. We all understand
that UDI provides a standard, unambiguous means to document device use in
various EHI. From FDA’s perspective, UDI and claims provides a complementary
data source to our current post-market tools. It can generate population-based
data on device exposures. It can generate population-based data on health
outcomes of interest.
It can provide a longitudinal profile of patient experience, which could be
potentially useful for baseline active surveillance, as used in our sentinel
initiative, which I will talk about in a minute. It is also useful for easier,
more accurate linkage across data sources. Last but not least, we believe that
UDI and claims may facilitate recall effectiveness. Payers may be able to help
contact beneficiaries in the case of major recalls.
I will skip this slide for the sake of time. FDA has had a history of use of
claims data at our center, as well. We have used claims data at the device
group level, and not the manufacturer brand specific level because of the
limitations of claims data. For instance, we’ll study coronary stents, but not
the Cordis Cypher stent, because again, we can’t identify to that level of
granularity and claims data.
We have participated in pilot studies under the auspices of the Assistant
Secretary for Planning and Evaluation, using multi-payer claims database. We
participated in pilot studies under the auspices of CMS, under their safe RX
initiative. Part of the drug reimbursement data was available.
They not only wanted to look at drug safety and effectiveness, but they
asked us on the device side to explore the use of Medicare and Medicaid data
for device safety and effectiveness purposes. We have also collaborated with
professional societies and registry linkage studies, where we get a lot of
granular information registry up front. It is short-term data. Then, we link it
to claims data providing longitudinal profiles.
Now, a bit about Sentinel initiatives. This was mandated by Congress on the
Food and Drug Administration Amendment’s Act of 2007. It was implemented in
2008. It mandated FDA create an active post-market risk identification system,
or active surveillance system, to monitor drug safety in particular. That was
launched in 2008. It has been very effective during the intervening years, to
set up such a system. It is focused on drugs and biologics.
Under the FDA Safety and Innovation Act of 2012, FDA was mandated to expand
Sentinel to include devices, as well. Sentinel is, for the most part, based on
claims data. They currently have information on 50 million enrolled patients
based on claims data. The current records that we have access to lack
manufacturing and brand-specific identifiers. Our use of Sentinel is very
limited because of that.
Having said that, we have used the Sentinel data on occasion. A couple of
examples are noted. Their utilization of hip arthroplasty devices by
articulating surface, and also the safety evaluation of robotically-assisted
What are the additional considerations? The first two bullets apply to EHI
in general. The ability to assess real-world benefit/risk of devices is
anticipated to have positive impact on healthcare costs and inefficiencies.
Certainly, UDI and claims can help us in that regard.
Unlike drugs, devices change quite frequently. They have a very short
lifespan. UDI is very necessary because we need to identify specific versions
of device to understand the public health impact of those versions. Lastly,
something that pertains to UDI in claims, absent UDI, payers are limited in
their ability to reimburse for specific devices based on value.
In conclusion, we believe that UDI in claims provide a complementary data
source to strengthen our national system. UDI is a key data element that
transforms claims data and make it have a significant impact on public health.
We recognize the challenges faced by multiple stakeholders, incorporating UDI
Last, but I think most importantly, the question is what is the appropriate
path forward to make UDI in claims happen in a pragmatic and cost-effective
manner. I conclude my remarks. Thank you.
DR. SUAREZ: Next, I think we have Greg from Brookings.
MR. DANIEL: Good afternoon. Thank you for the opportunity to testify before
the subcommittee. My name is Greg Daniel. I am a fellow and managing director
at the Engleberg Center for Health Care Reform at Brookings.
Within the center, I manage team focused on policies to improve innovation
and evidence generation for pharmaceuticals and medical devices. The center’s
health care innovation and value initiative includes a number of projects in
collaboration with the FDA, one of which is focused on development of a UDI
Through this project, UDI implementation roadmap, we have drawn upon
extensive research, as well as expert workshops and focus discussions, with
major stakeholder groups including patients, payers, providers, consumer groups
and others. While these discussion have informed the recommendations I will put
forth here today, my comments may not necessarily reflect the opinions of
everyone that we have engaged during our research.
Across the health care system, administrative transactions contain data that
are increasingly used to support numerous public health and research uses.
Pharmacy and medical claims are routinely linked with enrollment files to
create longitudinal histories using information from virtually all providers
and health care settings a patient passes through during care, to enable
examination of important health outcomes associated with many medical
interventions and encounters at a population level. Recent reforms in health
care are increasingly focused on improving quality in outcomes and reducing
health care costs.
UDIs can play an important role in improving outcomes with medical devices.
The optimization of UDIs will be essential to ensuring that patients and
providers can access the most relevant and timely information on the
performance, effectiveness and safety of medical devices.
Some of the tangible benefits that can be realized in the near term by
incorporating UDIs into administrative transactions include improving the
understanding of utilization, performance and safety of unique medical devices
when they are used in clinical practice, enabling the ability to conduct health
outcomes research for medical devices on a wider and more cost-effective scale,
enabling the ability of health plans to play a role in recall management,
leveraging knowledge of quality and outcomes of medical devices to drive better
and higher quality health care, as well as better management of cost of care by
increasing the transparency for payers and patients in the actual devices used
While electronic health record data and other sources of clinical data can
be a very rich source of clinical detail, their limited ability today to
collect data as patients move across providers and across sites of care renders
them less useful for population-level surveillance and performance tracking
Administrative transactions represent an opportunity to track devices,
services and procedures across provider systems in a way that is currently more
feasible than EHRs. For example, as Tom noted, FDA Sentinel initiative uses
claims data, which can be linked to medical records, to assess drug safety for
large patient populations in near real-time.
Similarly, health plans, health services researchers and epidemiologists
routinely use claims data to measure and track the impact of prescription drugs
and other interventions on important outcomes. However, without UDIs in claims,
these activities, including the Sentinel initiative’s activities, are rarely,
if ever, conducted for medical devices.
Through our research at Brookings, we have identified three potential
scenarios for incorporating UDIs into the administrative transactions. Each has
their own costs and benefits. The primary scenario is to incorporate UDIs into
the X12 837 claims transition forms.
While there would be a lengthy standards development process, we feel that
leveraging the existing mechanisms for transferring valuable information
between providers and payers seems to be the most feasible and straightforward
option that will provide real opportunities to improve care for patients
An alternative option includes incorporating UDIs into the health care
claims attachment forms often used to supplement primary claim documentation.
However, the major issues include the low penetration of structured electronic
claims attachment forms into provider systems, lack of a final rule regarding
standardization, as we heard this morning, and significant technical challenges
with retrieving UDIs from these forms and using them in the ways to maximize
benefits that I outlined above.
A second alternative that we have heard includes incorporating UDIs into the
claim authorization request and response standards, such as the X12 278
transaction set for prior authorization. However, this scenario would limit
UDI’s scope to transactions that require prior authorization. More importantly,
it would necessitate that the providers have foresight into the exact brand and
type of device that will be used before a procedure is done.
For many surgical procedures, this information may not be known in the days
or weeks leading up to surgery. As a result, UDIs would not be an accurate
reflection of the actual devices that were used.
Our current recommendations at Brookings, from our research and expert
opinion assessments, is to incorporate UDIs into the claims transaction
systems, as these systems, as I have indicated and as you all know, are the
primary mode of transferring information between providers and payers.
More specifically, we recommend that UDIs be incorporated as a new field
into claim form X12 837 at the claim line detail level and as a situational
rule. The situational rule would allow providers to coordinate with payers to
determine the optimal business rules for collection of UDI, while ensuring that
provider and payer systems can incorporate UDI across a breadth of billing
Also, prioritization of which medical devices to capture in the claims forms
should also be explored. We think that starting with high risk implantable
devices seems to be a reasonable starting point. We also believe this
recommendation currently has substantial support in moving through the
standards development process and promises the most feasible option, with the
widest impact to improve care, relative to other administrative transaction
The number of challenges facing providers and payers, and the vast
heterogeneity among their resources and capabilities, make giving any qualified
assessment and recommendation for UDI incorporation extremely difficult.
Nevertheless, given the expected impact and current evidence available, UDI
inclusion into the claims transaction process represents a unique opportunity
to advance the public health, improve the safety and quality of care delivered
to patients, increase operational efficiency and improve price transparency of
Thank you all very much for allowing me to present today.
DR. SUAREZ: Thank you so much. We are going to go next to Jean Narcisi.
MS. NARCISI: I am Jean Narcisi, director of dental informatics at the
American Dental Association and a member of the WEDI Foundation Board of
Trustees. I would like to thank you for the opportunity to present testimony
today on behalf of the WEDI Foundation concerning the unique device identifier.
The WEDI Foundation is a charitable organization dedicated to scientific
research and education in order to foster the improvement of health care.
Through our activities, the WEDI Foundation works to improve an exchange of
administrative and clinical health care information.
The WEDI Foundation, with support of the Pew Charitable Trust, recently
completed a report regarding the capture and transmission of UDI. The goal of
our recent work was to determine the best option for transmitting the UDI for
non-dental, high-risk implants among stakeholders to achieve the full benefits
of a quality medical device post-market surveillance system, without adding
significant costs and complexity.
To address this challenge, the WEDI Foundation conducted a series of
meetings involving multiple stakeholders from the health care industry to
discuss the many facets of post-market surveillance, with particular focus on
the transmission of UDI from providers to payers. The focus of these
discussions was high-risk implanted devices only. UDI transmission is not
cost-effective, nor necessary for all devices. Only those devices that are
prone to failure and would cause substantial harm to patients should have the
UDI transmitted. High-risk, implanted medical devices fit that definition.
The outcome of the discussions was recognition that a hybrid approach would
be to the optimal solution to enable the UDI to become an integral component of
the post-market surveillance system in the United States. The hybrid approach
was identified as a way to enable UDI to be accessible for post-market
surveillance and is comprised of the following combination of initiatives.
First, the UDI should be added to the claim with a situational rule, to
enable interested providers and payers on a voluntary basis to transmit and use
the UDI for high-risk implants. Next, providers should work to capture and
electronically integrate the UDI into their internal systems, so the UDI is
available within their clinical systems, supply chains and administrative
Registries should be modified to add UDI and work to consolidate data from
facilities. Also, all payer claims databases should be modified to add UDI and
work to consolidate data from multiple all-payer claims data bases.
In addition, further research should be done to evaluate if UDIs should be
included in the pre-authorization transaction to enable interested parties and
payers on a voluntary basis to transmit and use the UDI for high-risk implants.
With support of the FDA, pilot projects should be developed that demonstrate
UDI being transmitted between entities, for example, provider to payer,
provider to registry. This approach uses existing infrastructure and minimizes
the burden on any individual stakeholder, and enables each stakeholder to
utilize UDI along its own timeline.
The WEDI Foundation also suggested that EHRs should eventually be able to
transmit the UDI from providers to registries, payers and other stakeholders.
However, that capability will not be realized until well into the future.
Achieving the benefits of UDI in the foreseeable future requires the inclusion
of UDI in the claims.
In response to the questions, what is the current understanding of the
purpose, value and benefits, the WEDI Foundation proposed a situational rule
that establishes a voluntary approach to achieve the goals of post-market
surveillance, to improve device safety in public health with minimal additional
costs, complexities and burdens.
The situational rule suggested was as follows. The UDI will be used for
reporting the unique device identifier when a health plan and hospital mutually
agree to transmit this information, or as deemed by the provider to enhance
claim reporting. Including the UDI in the claim with the proposed situational
rule makes the inclusion of UDI voluntary, meaning providers would not be
required to report it, and payers would not be required to collect it, unless
they have both agreed to do so.
Providers would need to make changes to their charge master and billing
systems to include UDI. The UDI pilot projects have made these changes or are
in the process of making these changes because their evaluations indicated that
the potential benefits and cost savings outweigh the costs of the changes.
Ultimately, through the situational rule, providers and payers, registries
and the FDA could compare the efficacy of similar devices to determine the
quality based on actual results in the large patient populations, identify
poorly-performing devices and safety risks, assess differences in the
performance of devices to improve competition among manufacturers, and ensure
that patients use the highest quality and most appropriate technologies for
their conditions. Assist with device recalls to ensure that all patients
affected by failing technology receive appropriate follow-up care.
Payers and providers would be able to work together to identify the
best-performing and cost-effective medical devices. Many benefits could result
from the transmission of UDI to payers as part of a hybrid approach. Payers
could assist with recalls by using UDI data to more quickly and efficiently
reach the patient and the health care facility in which the procedure was
performed, which in many cases could have been several years prior.
Currently, many of the highest risk recalls end without all devices
accounted for and identified. Partially because hospitals and manufacturers
lack up to date contact information for the patients. Health plans, on the
other hand, are another stakeholder that can contact the patient, and often
will have more recent contact information.
FDA Sentinel system has successfully evaluated the drug’s safety, and
Sentinel, though, lacks access to data and device quality in the specific
devices used in health care. UDI transmission to the health plan would enable
Sentinel evaluations of device quality.
According to Richard Platt, M.D., professor and chair of the Harvard Medical
School Department of Population Medicine at the Harvard Pilgrim Health Care
Institute, and the Sentinel program lead, the transmitting of the UDI and the
claim is the least burdensome method of using Sentinel with devices.
Payers would have access to detailed device information to conduct their own
analyses on device quality and performance. As payers currently lack any
information on the specific devices used, this information would provide them
with previously unattained data to access the care of beneficiaries.
This information would support longitudinal analyses when patients see
multiple providers or obtain follow-up care from a physician that did not
conduct the initial procedure. Both existing and new registries could link with
claims data to provide longitudinal analyses on medical devices. As registries
often only house short-term outcomes data, this capability would ensure
long-term data collection linked to detailed patient information.
There are a number of challenges and issues identified in adopting and using
UDI in administrative transactions related to system changes that would be
required. Hospitals would be required to add UDI to their electronic health
care record systems in order to begin capturing the UDI at the time of
placement, and then move that data over to the hospital revenue systems, so
that the UDI data could be submitted in the claim.
There are a number of technical issues that the hospitals would have to
address, including UDI in the administrative transactions, including
integration of clinical EHR systems to billing systems, modifications to the
hospital charge master to accommodate at least a portion of the UDI value.
Payers, as well, would need to adjust their systems to accommodate the proposed
change to the X12 standard and scrap the UDI data as it was accepted and
adjudicated through this process.
The WEDI Foundation delivered its white paper and related to recommendations
to X12 for further consideration as part of their development process. We defer
to X12 to comment on the current state of the development regarding current
standards and efforts to address UDI.
In conclusion, the WEDI Foundation evaluated various avenues regarding UDI
capture and transmission. In evaluating the alternatives, the WEDI Foundation
came to the conclusion that a hybrid approach to capture UDI, in order to
improve post-market surveillance, is the most efficient approach. As part of
our suggest pathway, we believe that an initial step be made to modify the
claim transaction to accept UDI.
Given the post-market surveillance system infrastructure that has already
been built and operated by the FDA user large payer data, placing the UDI into
the claim seems to be the most expeditious way to begin collecting and sharing
UDI between partners. The WEDI Foundation acknowledges that there are technical
challenges and costs associated with this approach. However, they believe that
combining this approach with a larger term, registry-based approach will yield
a much better understanding of the performance quality and costs of implantable
devices. Thank you again for the opportunity to testify on behalf of the WEDI
DR. SUAREZ: We will move next to Josh.
MR. RISING: Thank you very much. Members of the committee, thank you for the
invitation to testify at today’s important hearing. My name is Josh Rising. I
direct medical device work at the Pew Charitable Trusts.
Gaps in our medical device post-marketing surveillance system have resulted
in problems conducting recalls of high-risk devices and an inability to quickly
identify problems with medical devices, highlighted by recent issues with
metal-on-metal hips and implanted cardiac defibrillators. We can and should do
a better job in this country. The UDI system will help make improvements in
both of these areas.
As you heard earlier from Dr. Gross, UDI is central to FDA’s vision for
improved post-market surveillance of devices, and claims are a critical element
of this plan. UDI capture and electronic health records and claims are both
essential, but each is insufficient on their own.
UDI capturing EHRs will provide detailed information for hospitals and
providers to do care coordination, and for hospitals to contact patients
affected by recalled devices. However, as we all know EHRs are not generally
interoperable. Data from them is not easily aggregated, which makes it very
difficult to analyze patient outcomes across multiple institutions.
In contrast, UDI capture and claims would provide large longitudinal data
sets for analysis, including when patients switch providers. This is because
claims are standardized across payers and providers, and are therefore easily
Think of a patient who has gotten multiple cardiac stents or an implanted
defibrillator. That patient may see multiple providers or seek emergency care
in different states. A health plan using claims data would have information on
all those visits, even when the providers are not in the same health system or
using the same electronic health record.
Why is EDI data in claims important? Certainly, I think the other panelists
have done a nice job articulating some of these reasons. Briefly, we know that
health plans would be able to do analyses on device performance, as they
already do for drugs. Second, FDA could better evaluate device outcomes through
its Sentinel initiative, which relies almost exclusively on claims data. I
would also like to highlight that Congress, in 2012, required the FDA to expand
the Sentinel initiative to devices, which will only be possible at this time if
the UDI is added to the claims form.
Third, claims can provide information on the total number of devices that
are used in care. Now, currently, FDA, through its adverse event reporting
system, only has some information on the number of problems that have occurred.
Unfortunately, the agency typically does not have data on the total number of
devices that have been used, and therefore, has difficulty calculating the rate
Finally, payers could assist with device recalls, as they may have more up
to date contact information for patients. UDI capture and electronic health
records alone does not yield these same benefits.
Now, there has been some discussion before, and we will likely have some
today, as to does it make more sense to have the UDI and the claims, or the
claims attachment? Or is there some other way that this information could be
transmitted between different groups?
Now, we know that claims are standardized and are currently used on a
regular basis to transmit health data. They also are proven tools for payers,
FDA, Sentinel and others to evaluate medical products. Generally, we support
any mechanism to achieve the public health benefits that we have talked about
and that others have articulated.
At this time, we believe that adding UDI to claims meets this threshold. We
have concerns that other strategies that you may hear about do not. For
example, claims attachments are not standardized. We heard today that the rule
from CMS is a year away or more.
Additionally, there may be some proposals to extract UDI data from
electronic health records to a public registry, to multiple registries, to FDA
directly. Unfortunately, such a proposal would require significant
infrastructure changes that may be even more difficult and costly to implement
than adding the UDI to the claims form would be. It is just unrealistic to
think that any of these other proposals will be feasible at any time soon.
Claims, on the other hand, are a proven mechanisms already used to transmit
data to evaluate drug safety and quality. We should have parity for devices, as
We also recognize that including UDI in the claim will require some new
processes to be developed on the part of providers. As articulated by others,
the benefits outweigh these changes. It is also important to note that the
changes we are talking about here would not apply to all medical devices, but
only the subset of high-risk implanted devices for which the benefits would be
There is already significant support for UDI capture and claims within HHS.
I would like to draw your attention to comments made by HHS Secretary Burwell.
Skip to the end, quote, the Sentinel initiative will ultimately benefit by
incorporating UDIs into its claims data sources.
Now, as you can see here, all these groups have written letters supporting
UDI capture and claims. Notable support from this diverse group of stakeholders
includes the Mercy health system, the Geisinger health system, the Society of
Thoracic Surgeons, the American College of Cardiology, the Pacific Business
Group on Health, Premier, AARP and many, many other groups.
Now, there is already some progress on incorporating UDI into administrative
transactions. The Pew Charitable Trust submitted a change request to ASC X12
last summer, to add a field for UDI and claims. Given the importance of this
issue, ASC X12 is exploring how to transmit UDI electronically. You will hear
more about this from Margaret Weiker.
We have also worked with the WEDI Foundation, whom you just heard from, to
assess the business case for UDI capture. I think they articulated nicely the
many business cases for doing this.
Ultimately, UDI capture and claims can greatly improve patient safety and
health outcomes. I urge the committee here to help support this effort. Thank
you, and I am happy to answer any questions that may come up after the
DR. SUAREZ: Thank you so much. Stuart, I think, is next.
MR. KILPINEN: Thank you. Members of the subcommittee, thank you for inviting
me to speak with you today. My name is Stuart Kilpinen, and I am the executive
director of national contracting at Aetna.
Aetna is one of the nation’s leading diversified health care benefits
companies, serving an estimated 44 million people with information and
resources to help them make better informed decisions about their health care.
We are committed to working with employers, regulators and the medical
community to improve quality and lower the cost of health care to build a
sustainable, healthier system.
As consumers take more responsibility for health care decision-making and
purchasing decisions, they are demanding meaningful, credible data on specific
health care costs and quality. This information has become even more important
in today’s economic environment.
Today, the lack of transparency throughout the supply chain for medical
devices presents significant challenges to measuring performance and managing
costs. Through its creation of unique device identification, the FDA has
developed the necessary coding to address this issue.
Aetna supports using UDI in claims transactions to improve the quality and
lower the costs of health care for our members. Hospitals, doctors and health
plans need a programmatic way to identify and track devices that patients
receive, and the claim transaction is the primary avenue of medical and
financial data exchange between hospitals and doctors, and health plans.
Aetna believes the following potential uses of UDI and claim transactions
will help improve both the quality and lower the cost of health care. Outcome
studies, using claim data for treatment received before and after device
implantation, health plans could conduct outcome studies that compare the
outcome and performance of devices.
Health plans through claim data have access to the services received by
patients throughout the health care system. The results could give doctors and
members additional information on quality and cost, as well as inform health
plan utilization management.
Price transparency, currently health plans and members have little to no
insight into the cost of various medical devices prior to the service being
rendered and paid. Inclusion of UDI in claim transactions would allow plans to
provide members with better costs and out of pocket estimates prior to the
services. As patients are responsible for a growing percentage of their health
care costs, it is critical that the cost of care is clear.
Device recall management, UDI would give health plans the ability to track
and potentially inform members of device recalls, which could help prevent
adverse or worsened health outcomes and increase medical costs. Additionally,
members could be more easily informed of their rights associated with recalls.
Health plans and plan sponsors could also more effectively enact their rights,
including payment recovery from manufacturers and providers.
Disease management, armed with data on specific devices received, plans
could help answer members’ questions on recovery and longer-term health and
wellness, including exercise. Plans could coordinate and ensure compliance with
required follow-up care, such as rehabilitation therapies.
Finally cost management, UDI would allow health plans to negotiate
cost-based reimbursements to hospitals, establish medical device formularies
and negotiate manufacturer discounts. Additionally, improved price transparency
and performance data will enable consumers and health plans to make more
cost-effective purchasing decisions.
While UDI is not currently required for claim adjudication, required
inclusion in claim transactions would enable health plans and hospitals to
develop cost-based reimbursements which could be adjudicated based on UDI. All
these potential uses could help improve quality and lower the cost of medical
care for both employers and members, and consumers.
Moving forward, Aetna would like UDI to be required on all appropriate
claims. While this will require enhancements to provider billing systems and
health plan claim systems, we believe that the benefits described above
outweigh the costs of implementation.
Aetna would also support a hybrid approach in the interim as proposed by
WEDI to begin the movement to capture UDI on claims. Inclusion of UDI in
electronic transactions will help improve the quality and lower the costs of
health care for our members through the potential benefits I have described
today. Aetna strongly believes that the claim transaction is the most
appropriate way to capture the UDI and to generate these benefits for consumers
and employers. Thank you.
DR. SUAREZ: Thank you very much. George, I think you are next.
MR. ARGES: Thank you, committee, for inviting me to be here today. I feel
like a little David with Goliath people here basically saying put it on the
claim. In any case, I will try and make a case here for some of the issues that
have been brought to my attention.
I am George Arges. I work at the American Hospital Association. I also am
the chairman of the National Uniform Building Committee. I know that the
National Uniform Building Committee had sent a letter to Walter Knobb to
basically voice our concerns with respect to putting the UDI on the claim.
Now, we do recognize the importance of UDI. We do think that the UDI is
really a step forward in terms of being able to draft medical devices. It has
purpose. It has value in what it is capable of doing. As others have stated
over here, it is an important piece.
The problem, however, is the fact that putting a UDI at the claim level, at
a line level, is something that is not done today. While I know they have
mentioned the National Drug Code, most of the information about the utilization
of that really comes from claims that come from retail pharmacy, not from the
institution or provider sector.
Even there, where it is used, it is not used very consistently. The
important piece here is that recognize that the existing revenue cycle process,
namely the charge master at the line level, does not really provide that sort
of efficiency. We need to make certain that we do design something that is
efficient and is something that can be cost-effective in its implementation.
One where it really does the public good, in terms of being able to handle this
and make it very predictable.
Again, the hospital systems aren’t a part of this. Keep in mind, simply
putting it on the X12 transaction standard does not really recognize the other
internal systems that have to change within the hospital. These are enormous
cost systems. The X12 standard is really a mapping exercise from an existing
information system to a A37 transaction standard that is used as part of that
On the surface, it seems simple. Put it on the claim. We think that is the
wrong approach. It would involve enormous costs. The charge master, again, has
never done this sort of thing at this level of detail within the hospital
We have on our National Uniform Building Committee provider organizations
that represent a variety of providers. They were unanimous in opposition to
putting this on the claim. I want to basically emphasize that. It is important
to note that.
Not only that, but even the vendor representative, who supports hospital
systems, agreed with the committee’s decision and wanted us to voice our
concern about this. These are enormous costs that would be instituted.
Who will pay for this? Is it the federal government? It is the health plans
that would want to do this? Any action to add this to the HIPAA claims standard
should be mindful of the importance of the administrative procedures, the act
in terms of being sure that we understand the cost and the implications to the
industry for having to implement something like this. It needs to be vetted. It
hasn’t been vetted to that level at this point in time.
Now, the claim has been designed for reimbursement, and we all know that. I
am glad to hear that everybody believes that the claim is a be-all, end-all. We
also heard the discussion earlier today about the importance of the claim
attachment, and how it can provide valuable information that really supplements
the claim. There is the intersection, if you will, between the health record
and the claim information in this data. I think this is an opportunity really
for something, such as a UDI, to really be at the crossroads of that
The existing mechanisms today are already in play, and the UDI does not add
additional payment. We heard the possibility of maybe we will get paid cost,
which might be an up payment for many providers, as opposed to something that
is negotiated at something less than cost. In any case, we also heard the FDA
basically say, the lifespan of medical devices is very short. The maintenance
process for the charge master to be able to handle this is really at the crux
of the problem.
Being able to have not only the medical device by the manufacturer, which is
something we don’t do, and not only that, but the production lot number, to be
able to report that, is enormous. There are new interfaces that have to be
built between the purchasing department and the charge master department.
We think the claims attachment is really the place to be as part of this. I
think what we had discussed with some of the folks at the Brookings Institute
is a way to basically do this. Stage three, meaningful use, does require the
EHR to basically capture the UDI. Why not build a process that can take
information from the EHR and really put it on the claim attachment as a way of
supplementing the information to the health plan? It would make the task much
simpler for the health care provider and give the FDA, and others who are
interested in monitoring this, the opportunity to track this longitudinally.
Not only that, but the ability to narrow this down because you can’t have
every device that has a UDI reported. I don’t know that you would want it. Do
you want a little screw that’s inserted reported as part of this process?
We need to keep being mindful of all of the components that make that up. If
you are looking at maybe surgical procedures, and you are saying, okay, I have
got ICD9 codes that describe a certain surgical procedure, I know those need to
be reported with the UDI. You can build the mechanisms within the hospital
setting that basically say, I am going to take this information from the EHR
and put it on the claim attachment, and send it to the health plan. That, to
me, makes more sense. It makes it easier.
As I said, the NUBC was opposed to this in many respects. I know some of the
health plans abstained as part of that process. There was general consensus
among all the members of the NUBC to be opposed to this. I want to basically
remind everyone here about checks and balances. When reporting requirements are
being introduced, process matters. We need to be mindful of how that process
works and the organizations that have been charged under the HIPAA legislation
should be consulted with.
NUBC, NUCC, ADA’s dental committee and WEDI, as part of the development of
ANSI standards, is something that is speaking loud and clear about what has to
happen as part of this process. That is, in a nutshell, where the AHA is at. I
would be happy to take questions later on, as part of this process.
DR. SUAREZ: Thank you, George. Margaret?
MS. WEIKER: I am still Margaret Weiker, chair of the ASC X12N subcommittee.
I am going to talk about the UDI. I am going to go ahead and flip to slide
eight. A lot of the information in slides one through seven describe the UDI,
what it is, how it is formatted, et cetera. In the interest of time, I am not
going to talk about that.
Slide eight, change request 1308, this is the original change request, was
submitted in June of 2013 as a placeholder for the UDI. At that time, the WEDI
Foundation, along with the Pew Charitable Trust, was in the process of creating
the white paper that both have referenced.
This was a placeholder for an X12 to hold. It met the requirement for the
cutoff for the next version, which was important, as well. This is the original
change request that we held. Then, we received the WEDI Foundation paper,
facilitating the capture and transmission of UDI.
We, meaning me specifically, have received many, many, many letters
supporting, as well as not supporting, the inclusion of the UDI in claims. As I
have been receiving them, if Walter is not CC’d on them, or he is not also on
the two line of those letters, I am forwarding those letters to Walter, as
well. Some people know to send them to Walter and all of the others don’t. I am
doing that just so the committee can see both sides of this because, as I say,
I am getting both supporting letters and non-supporting letters in regard to
the UDI in claims.
The change request, once we have the white paper, it then triggered the X12
process. At that time, the change request was then assigned to an appropriate
workgroup. The primary workgroup that the change request was assigned to was
the billing and encounter information workgroup. They are primarily responsible
for the 837 transactions.
The services review information workgroup, which is primarily responsible
for the 278 transactions, and the PACDR SAC, which is the all-payer playing
database and its special appointment committee, opted in as secondary. As there
was discussion around including the UDI in an all-payer database, as well as
possibly using the 278 transaction.
At that point, then we decided at our June meeting, considering timelines,
that we would begin the business requirement gathering process. Out of the
letters and white papers that we received, we put together what those people
that sent the letters and the white paper had about the strengths and utilizing
the UDI in claims. I think most of this has already been discussed, so I am
going to skip through it.
We also went through the letters that voiced concerns about it, and we
listed those. Some of the concerns were, it may affect the processing and
payment of a claim. It would require the introduction of a new billing process
that doesn’t currently exist today. It would require a significant departure
from existing claim submission routines. New billing look-up system and
interface, cost and benefits have not been determined. This should be vetted
through formal rule-making. Then, you had competing regulatory requirements.
When we presented this at X12, like I said, we took the why it should be on
the claim, and we also took the concerns of why it shouldn’t be on the claim,
or things that we needed to keep in mind, and tried to paint an even picture
around the UDI.
It was proposed that we create this as a situation on data element. It would
be based on trading partner agreement, whether it was sent or not. It was also
proposed that it be limited to high-risk devices, such as HIPAA knee
replacements, cardio stents, those type of things, and that it be used for
reporting purposes only. In other words, you wouldn’t rely on the UDI to
actually reimburse the claim. It would only be used as supplemental or
Then, we also had where people proposed, as George mentioned, on the claim
attachment, that it be sent on an attachment, or that it be part of the health
care services review notification. When I say that, that is not the 278 that
has been adopted under HIPAA.
This is a different business purpose of the 278 transaction. It is called
the health care services review notification. This is something done after the
fact. I have done the service. I have filled the claim. I am notifying the
payer that this particular situation happened.
The notification is a different transaction than the 278 that has been
adopted under HIPAA. There is an implementation guide for that transaction. It
has not been widely adopted, and that is primarily because it is not a
HIPAA-mandated transaction. That was also proposed.
At the meeting, we held a discussion. Multiple stakeholders were present,
providers, payers, clearinghouses, software vendors, other interested parties
attended the meeting where we had a discussion about this. We developed a plan
for moving forward, which was to establish a specific workspace.
We used a collaborative tool where members can post documents. We scheduled
meetings and that type of thing. We are going to establish a specific
workspace, which will allow both members and non-members to participate. We
think it is important that everybody that wants to participate can participate.
We will primarily be doing the work via conference calls, to review and to
discuss. We will also be collaborating with other SDOs, such as HL7 and NCPDP.
Also at the meeting, we revised the change request wording to be more generic
and only suggest we find a solution to the business need. This is the revised
change request. Yes, I know, it is an eye test
You can see that it has been revised when you look at the old one versus the
revised. We made it more generic. We took out claim to say there is a business
need, a business requirement, but let’s not decide what is going to meet it at
this point. Let’s develop the use cases. Let’s develop the business
requirements. Then, once those are done and agreed upon, then we make a
determination of which transaction or transactions, maybe it is multiple, it
would go in.
The change request was modified. The Pew Charitable Trust was in the room
when the modification occurred, and they assisted in modifying their change
request. If you would like to see this, and not through an eye test, the URL is
at the bottom, if you want to look at the change request. You can just go in
and type in 1308 into CR browser.X12.org and pull it up. You can read it there.
That concludes my testimony.
QUINN: I was asked to give an update of what is going on with UDI inside of
HL7. I spent about an hour on the phone last night to get the latest. To start
this off, the FDA and HL7, at last fall’s meeting in Cambridge, Massachusetts,
introduced us to UDI.
Essentially, I am looking at the part of UDI’s existence that exists before
the claim. I am not proclaimed pro-attachment. I am just interested in getting
it in the EHR. Typically, this would come from a number of sources. I mean, it
is yet to be determined. It could be attached to patient demographic
information. It could be attached to certainly a charge record that floats
around in the environment that ultimately ends up in the billing system.
What happens with it after that, as long as it is properly formed, and the
right tools are in place to be able to use it? Then, it seems to me that I will
let others figure that out. Right now, HL7 has four major product lines,
version 2, version 3, CDA and Fire. We would adopt this UDI into each one of
those four. It would be equally usable in all four disciplines.
Obviously, CDA contains the CCDA, which is sort of the core of EHR
information that we have been talking about. Fire is this new web
services-based application environment for moving around data and querying and
distributed processing. That would be the future.
As soon as we started working with them, we were directed to, and some of
these are already familiar to us. Three major caretakers of bar codes being
GS1, HIBCC and ICCBBA. These each have different ways of expressing that you
are looking at the human readable number that is, in fact, the UDI. That is
what we are seeing right now.
We have gotten the parsing roles and the architecture format from all of the
three organizations. The problem we are having right now is there is some
contradictions in the GS1 definitions, which would either create some
horrendous algorithms that we would have to develop, or more likely the case,
there has been a miscommunication. We have got all the information we need,
except GS1. Of course, GS1 is the big player on the block. We need to get this
resolved. Again, the problem has to do with the human readable form, not the
other stuff that goes with it. That actually is pretty routine to us.
GS1 is an European organization located out of Brussels. They are very
active in health care. They are very active in the ISO TC 215 standards that I
represent HL7 at. Right now, they don’t understand why we don’t understand. We
will figure it out.
The temperature is high enough on it that I am going to be bugging everybody
every week as to what it is going to take to figure this out. If GS1 has got
this working, which I believe they do, I mean, as in the ability to handle bar
codes of this complexity, and the information that goes along with it, and
needs to be put in the registries than this really should be a piece of cake at
The guy I have got working on it is the guy who chairs when we take those 55
working groups, and we divide them into four divisions. The division that deals
with foundations and technologies, so Paul Knapp is the co-chair and the guy
who is working on this. He has done an awful lot of the work that we have done
with ISO in terms of maintaining the data types, as well. I have every
confidence in him. He and I spent a long time on the phone last night. It
doesn’t add up, so he has to go back.
GS1 is a little bit touchy about this. I am going to probably have to talk
to the guy who work with in ISO to see if we can get some good conversations
going. I am looking at this. It is not a problem. We will have this solved
within a few weeks. This is not the worst. I mean, it would be nice if Brussels
was in the US, but it is not. It is a few hours away.
I am, at this point, pretty confident, a lot more confident than I was at
the ISO meeting when I found out how upset GS1 was. That is where we stand. I
will let you know, Walter, first if there is anything other than what we expect
DR. SUAREZ: I think we are going to go to questions now from committee
members. This is a very important topic, of course, and one that is close to
the kind of work that I do, too.
I do have a few questions. It seems to me that in general, what I have heard
anyway, even with those testimonies that are against the use of UDI in claims,
there seems to be a consensus around the value certainly of using UDI and
capturing UDI in some way, shape or form in an appropriate administrative
transaction, transferring that to the payer and having the payer have it.
Perhaps if anybody disagrees, they can comment, too, on that assumption.
In some ways, the question is not too much whether, but really how. In what
ways do transactions, which appropriate transactions should carry it? Then,
there are two parts of this, which is how can we do it today, and in the near
term, and then how do we do it into the future? The how do we do it into the
future seems to be working to the process of the standards of elements
My first question is really about what are the possibilities of if we were
to do it today, what are the possibilities of doing it today in any possible
transaction that exists today? I am not saying do it through claims or through
others. That is the first question.
Then, the second question seems to be more about designation of the UDI as a
formal HIPAA name, either code set or identifier. The UDI has an unique thing
which, in my mind, is different from other things because the UDI is, in many
ways, both a code set that categorizes and provides the categorization of
classes of devices, such as taxonomy codes for specialty physicians. It is a
code set in that way.
It is also an identifier because it actually identifies a very specific
item. My question perhaps is more about to what extent do you all see the need
to basically designate this as a HIPAA code set and HIPAA identifier, both or
either of them. Those are the two questions. How can we do anything like this
in the near term if we wanted to do it? Is there a way to do it, to put this in
some transaction or some place? Then, the question about the code set or
identifier, or both. Who wants to jump in?
MR. ARGES: In terms of it being code set, I do agree, if you look at
process, it should go through the process. Complicating the matter, though, is
I am not sure that there is a single maintainer of the UDI, in terms of how
that is developed. It is not, in the true sense, a code set.
It is really a manufacturer’s identification system that is unique. It
provides production lot information. There really isn’t a system maintainer for
that. I think that only complicates the matter. Ideally, I think it still needs
to be vetted.
QUINN: The structure of the UDI is very specific and relies an international
standard called OIDS, Objective Identifiers. In order for this to work, there
are going to be at least those three major organizations that are creating bar
codes are going to have online registries.
Actually, it turns out, the one thing that does work is that, if you look at
the beginning of the human readable form, the first two or three characters
tells you which one of the three code sets it belongs to. It is hard if you had
to look at a million of them, but a computer program looks at a million of them
and asks for another million. I would say it is an easily computable problem to
MS. WEIKER: Isn’t the FDA creating the GID, which will be the first part of
the UDI? Aren’t you creating that database, so that would be a central location
for that, as far as this, nobody has a code set. Nobody is maintaining.
MR. GROSS: There are different concepts at play here. The database you are
referring to is the global UDI database. We have stood up that database in
anticipation of receiving device identification information into that database.
It will be the gold standard internationally.
It will contain the device identifier. There is a device identifier and a
production identifier. George, when you referred to lot and serial number, that
is a production identifier. Then, there is the device identifier, the
manufacturer make and model.
The global UDI data base will contain the device identifier. It will
ultimately be accessible by whomever would like to assess it, avail themselves
of the data in the global UDI database. We will have device identifiers. It
will also have attributes linked to those devices. They could be regulatory
attributes, such as the pre-market status, if it is a PMA product or a 510K
It will have attributes such as whether the device contains latex or not,
whether it is sterile or not, attributes like that, a dozen or two. That is
what will be housed in the global UDI database.
With regard to the three organizations, the issuing agencies, as we call
them, GS1, HIBCC and ICCBBA, we have accredited them recently the past few
months to be issuing agencies to issue, certify the UDI that is created by the
manufacturers. They are the issuing agencies.
Yes, there are three standards. There is the GS1, the HIBCC and the ICCBBA.
We decided to do that because those standards are so embedded in current
practice that it made no sense to retreat something to NOVO. We have engaged in
dialogue with major stakeholders for well over a decade, to understand
stakeholders’ interests, including GS1, HIBCC and so on and so forth. That is
why we have three standards for identifying the UDI.
It makes sense in terms of the current marketplace, and the transition to
the global database is that all that much easier, given the fact that we
recognize those. I don’t know if that clarifies things or confuses things even
more. That is, in essence, what we are talking about, so different concepts.
With regard to your question, I guess I am not a technical expert here. I
think the national drug codes. We have sort of been there and done that. What
lessons are there from the issue of code sets or drug identifiers? Do the same
concepts play against national drug code as you are putting on the table
throughout a UDI?
Again, I am not a technical expert. I don’t know, but it seems to me we have
crossed that bridge with NDCs. They have been quite useful on multiple fronts.
I look at the UDI in comparison to the NDC. Maybe that is not a fair
QUINN: There is something called SPL inside of FDA structure product
labeling, which would have the bulk of that information and a lot more on a
per-drug basis. That is a standard.
MR. ARGES: Again, the NDC is also something that is not routinely used on
the institutional of playing. The only time it is needed for reporting purposes
is when there is a Medicaid rebate program involved. I didn’t want to say this.
It is very haphazard in how it is reported.
MR. QUINN: That is kind of the reason why I brought up SPL because that is
basically all of the information that is in the little fold-up thing with one
pica font that you can get stuck in the carton with the prescription, is all in
the SPL record that the FDA keeps. That is probably a good, strong analogy.
MR. RISING: I guess I would like to kind of address some of your second
question, which was if we all see such value in this on a variety of reasons,
what would be the ways in which we could start doing this tomorrow, let’s say.
I think certainly we have been relatively focused on adding a new field to the
claims form, which I think everyone here is aware of is a multi-year process.
Certainly that wouldn’t work if we were to do it tomorrow.
The only thing that jumps to mind would be could a field that is already
existing be utilized for this purpose? If the structures of it and the rules
around it were able to be changed a little more nimbly. If you had both
providers and payers that were ready to go kind of with this information, both
to transmit it on the provider end and capture it on the payer end, that would
seem to be the one to pursue.
I am certainly not an expert in claims forms to be able to speak as to which
field could be done for that. That would be, in my mind, the way to go if you
wanted to do something like this as soon as possible.
DR. SUAREZ: Just a quick follow-up, would you say that a pilot of that type
of a reporting system be helpful to test this type of approach in a short-term
basis? I don’t know if there has been any pilots done already to demonstrate
some of the reporting capabilities? The UDI is not necessarily yet available,
but there are UDI components. The elements are already in place.
MR. RISING: The pilot program kind of think of most relevance was done in
California’s Medicaid program, where they used the UPN code for some DME goods.
Which again, George will be the first to point out kind of our different than
the sort of things we are talking about here for inpatient, implanted medical
devices. There was at least one pilot there, where they articulated kind of
several of the benefits to doing that.
Certainly, I think, there is never any downside to doing pilots, other than
the fact that sometimes they can delay a more widespread adoption. Certainly
kind of doing that in the short run, while the system we are preparing for
fuller scale implementation certainly would not hurt.
DR. SUAREZ: Just to finish my comment really, the first UDIs are expected to
be available by September of this year. That is what the intent is, right?
MR. GROSS: Right. For the highest risk devices, Class 3 devices, the due
date is about mid-September of this year. We have got the database fully
functional to receive those submissions.
DR. SUAREZ: What that means is basically that manufacturers have to obtain a
UDI of all their Class 3 devices by mid-September. Then, report that to the
good ID database.
MR. GROSS: That is right. We initiate an account with all manufacturers.
They submit the relevant DIs for their products to our database. They are
quality-controlled procedures. Then, ultimately, it goes through several steps.
We will publish the gold standard DI for external use.
MR. SOONTHORNSIMA: What I am hearing, maybe there are three things that we
are talking about today. One is around the standards, like you mentioned
earlier, the code set identifier. I think that was the gentleman from FDA, the
lead, talked about their gold standard database.
It is almost like, from my perspective, we have got by and large that issue
underway, solve, and evolve that. That is good. The second is really around an
earlier conversation about which mechanism, which process would we use to
exchange the data? Whether it is HL7 or attachment or 837 claim transaction.
While we can vet through all that, I have a bigger question. It is really
around the last one. Let’s assume, like you said earlier, that the standard
will be published, and manufacturers will have to start using it. But over what
period of time, once we get the data exchanged, we have to collect the data for
some period of time before we can start really using the information.
Whether it is for safety, quality reporting or for cost management, is there
a vision that is established by these entities? Consider the three stages, the
gold standard database, the mechanism or process to exchange the data, and
lastly, how will this information be used for quality, safety and cost
management. Is there a vision and timeline, or a subset of reporting that
somebody has already envisioned?
MR. KILPINEN: I mentioned several benefits. In my testimony, I mentioned
several benefits. I think there is a different time horizon for each of those
benefits. I think some of those benefits could be immediate for certain
If, for some reason, one of these first level three devices that receives a
UDI in September is recalled in October, the sooner that we have the
information exchange, the sooner that we can act upon that information. Looking
at longer term outcome studies for devices and comparing devices, may take
longer to gather the necessary data to do those cost comparisons or outcome
comparisons. I think it depends on the benefit that we are seeking to capture.
MR. SOONTHORNSIMA: To your point, immediate benefit would be really for
safety and public health concern.
MR. KILPINEN: Yes, I would agree with that.
MR. SOONTHORNSIMA: With that said, I heard earlier, I may have misheard
this, that there are already sort of a priority list of devices or types of
devices, such as implants, that have already been identified as high-risk or
high-cost. Would that be subject to what you were saying earlier, in terms of
alerting the use of these devices if there is a safety concern?
DR. SUAREZ: I think that Class 3 because it is the first category that is
required to obtain a number by September 15th or by mid-September,
is the high priority at this point. Down the road, there is Class 2 and
potentially Class 1 enumeration, over the next five or so years. Right now, the
immediate priority is being given by the regulation that requires Class 3 to be
MR. SOONTHORNSIMA: Thank you. In that case, what do you think the industry
ought to set as a timeline for adopting something like this and make practical
use of it for safety concerns?
DR. SUAREZ: You are asking about the time log for the industry to adopt the
user UDI in some form of an administrative transaction?
MR. SOONTHORNSIMA: No. At the end of the day, the goal is for safety, right?
In the meantime, of course, it is the vetting between the SDOs to figure out
which mechanism they are going to use. The short-term end goal, whatever that
short-team means, is, as the gentleman from Aetna was talking about, if we had
something like this right now, we could provide the alert, identify patients
who are at risk of these devices immediately.
What would that timeline be? Is it 18 months from now, for that use type of
use? That is really, I think, the initial goal. Then, you have to work back
with in terms of at what point the SDOs, we have to figure out whether
attachment or whether it is going to be X12 P37 and so forth.
MR. KILPINEN: I think similar to reaping the benefits, I think the different
solutions are going to take different timeframes to implement any of the
electronic transmissions. To modify them or to come up with a new structure, I
think is going to take longer than trying to leverage, as Josh suggested, an
existing field that could be used. We haven’t vetted that.
To take immediate action, it would have to leverage something that is in
existence already. It is really dependent on hospital systems and their capture
of the UDI, as well, to be able to pass it in the first place, right?
MR. ARGES: If we had the UDI, at least from the purchasing department into
the electronic health record, I think that is the first step that has to
happen. If that had happened, I mean, we already have a mechanism in place
where there is premature failure of a device, and we report that. We report it
to the manufacturer. It could be reported to the FDA, as well. It could be
reported to a health plan, I suppose.
MS. GOSS: George, to that point, sorry to interrupt you, but I have been
really befuddled in this conversation about why we are trying to modify an 837
transaction, when we are looking at 2018, 2019 to get it into real-world usage.
What I am hearing is an individual health and a population health benefit being
able to be achieved by getting the data now, so that we can start seeing trends
across, recalls, use, blah, blah, blah.
We do lots of other public health monitoring, syndromic surveillance,
immunization, cancer, electronic lab reporting. I am wondering why we didn’t go
down that approach leveraging sort of the existing reporting for these kinds of
things like we are doing in CDC and link that up with FDA.
I am assuming you guys all talked about this, and I am not smart enough to
understand why it is not a good path or another alternative. The feds can drive
that outside of the federal rulemaking a heck of a lot faster than getting a
new data element into an 837.
MR. GROSS: We have current tools. I mentioned we have current tools. I
didn’t go into them. One current tool is a passive reporting system. It is
called our medical device reporting system. We get over a million reports of
supposed device-related adverse events. Now, this is across all medical
devices. There are lots of different types of medical devices.
What is important about claims data is it provides us the numerator and the
denominator for certain issues that could be critical. Coronary stents and the
rate of myocardial infarction cannot be captured in this system that gathers
more than a million reports a year. It is not meant to do that. It is the wrong
We do have other tools. We effectively use those tools. Premature failures,
fine, but if we are interested in the rate of those failures, we won’t capture
that unless we have population-based data. Syndromic surveillance, I don’t know
what exposure they are capturing to do syndromic surveillance. Probably EHR,
probably not very sophisticated, maybe the exposure is flu vaccine, which is
routinely captured. Device information is routinely not captured in any
If you talk about device safety and effectiveness, you are starting from
square one in these population-based data sources. EHRS, claims data,
unfortunately that is the state of affairs. Getting information about
automobile recalls, highly effective, highly efficient. If your implant goes
bad, you probably don’t know what kind of implant you have. That information
can’t get to you. That is today in 2014 in the United States. That is part of
what we are trying to do.
MR. SOONTHORNSIMA: That is why I asked the question. If there is no answer,
that is okay. I understand. That is why I asked the question if there is
consensus around the immediacy of having the fact that the data exists. We are
still trying to figure out the transport. If there is a safety concern, when
would be an optimal time for us to enact something like this, granted for this
small subset of devices.
MR. DANIEL: To respond really quickly, and to build off of Tom’s response to
Alexandra’s question. As we know, probably the most effective tool right now
for drug safety is Sentential. Probably the most effective tool for vaccine
safety is the vaccine safety data link, which again is using data primarily for
In the cases of vaccines, CPT codes generally can identify a unique vaccine.
In the claims data, you have the CPT codes, and those can be used. We have also
looked at within Brookings and our discussions, for medical devices, what would
be the most effective way to do device safety.
The consensus that we are hearing is registries themselves are very useful
today, but they tend to be for a specific device only or a therapeutic. Some
therapeutic areas have lots of registries. Other therapeutic areas really don’t
have any, but some way to link registries to claims data or claims alone would
be the most effective way to get safety information in real time in a very
MS. KLOSS: Greg, I think you mentioned early on, unless I misheard, so I
want to clarify, that one of the approaches would be to start this as a
voluntary effort. Did I hear that?
MR. DANIEL: I think that was the WEDI.
MS. NARCISI: That was one of our findings in the WEDI Foundation report.
MS. KLOSS: Thank you. That kind of ties to the pilot, but maybe perhaps goes
beyond with the number of health systems that seem to be in support of this,
seeing a short-term advantage. Is that an alternative approach to kind of
accelerate the pace of beginning to work with and get the data? I just throw
that out as something that perhaps needs to be explored a little further.
MS. NARCISI: It is really something that Stuart also mentioned, that there
are probably some providers that are ready to do this and some payers ready, so
that would be a great place to start.
DR. SUAREZ: Larry?
DR. GREEN: Where does the United States stand in relationship to this global
MR. GROSS: I am not sure what you mean by where we stand. We have created
the database. It is housed at the FDA. I mentioned in my remarks that we have
interacted with stakeholders domestically and internationally for well over a
decade, to get to the point where we issued a rule requiring manufacturers.
DR. GREEN: Where are the other countries? Have they issued rules to
manufacturers any place else?
MR. GROSS: There is international agreement to the general principles
underlying UDI. There is an international group called the International
Medical Device Regulators Forum. They have a guidance document which mimics the
portions that are in our UDI rule. There is a general agreement about UDI
Ours will be the gold standard, our database. We have offered to collaborate
with foreign countries who are interested in establishing their own database,
but based on the principles that have already been accepted. I don’t know if
that addresses your question.
DR. GREEN: It does very much so. I take from that, at the moment, going back
to Ob’s questions about why can’t we get this done now, there is not another
country to tell us what is going on with the devices. They don’t know, either.
MR. GROSS: Right, it is the manufacturers again who are responsible for
creating the UDI and then submitting that to our database. Once it is captured,
once it goes through quality control, we will publish those, so that anybody
globally can access that information.
MR. RISING: Just a quick follow-up to Dr. Green, from what I have seen,
there is no country that has a comprehensive approach to all medical devices to
be assessing quality and safety problems. There are countries that have for
some specific devices, built some sophisticated registries to help them really
understand what is happening with devices.
In Australia, for example, they have a renowned hip and knee implant
registry. They were the first ones who found the metal-on-metal hip problems.
DR. GREEN: Is that voluntary?
MR. RISING: Tom could probably speak better than I can, kind of manufacturer
support it. You have close to 100 percent participation rate by hospitals, so
there is a very high degree of adherence to it. I will defer to Dr. Gross on
MR. GROSS: There are countries that have very sophisticated registries
because of their socialized medicine system. It is not voluntary. When you get
born, you are into the system. If you get a hip implant in Sweden, it is
captured. How that hip implant performs will be fully understood.
We have an international effort that is linking over two dozen international
registries on hip implants. Right now, they are identified by catalog number.
We are going to be translating those catalog numbers into UDIs over the next
two or three years.
Again, a device identifier aspect of that resides in the FDA. It is
internationally agreed to. The other stuff, in terms of what happens with the
hip implant, other countries are way ahead of us in terms of developing of
registries, for instance, hip implants being one particular case.
DR. GREEN: This is probably solvable.
MR. GROSS: Well, yes, it is solvable, but again, we recognize there are lots
of costs and challenges involved.
DR. GREEN: So my other question has to do with consent. The NCHS privacy,
security, confidentiality committee is quite active. It strikes me that, once
you identify the device, the device ordinarily would only be associated with
one human being, the human being that has the device. You don’t implant the
same device into two knees.
MR. RISING: The unique identifier, though, isn’t a serial number. It kind of
applies to a general product.
DR. GREEN: A great benefit from this is recall and the ability to identify
who is at risk. Does that not require the identification of the person who
receives the device? If so, are there any consenting issues to establishing
MR. GROSS: Our global united database only has the device identifier because
of personal identifier information concerns, HIPAA concerns. We have the
manufacturer make and model. The UDI should be captured by hospital systems,
which include the serial number and that sort of thing. They have got to
protect that information, so it is up to the hospitals to protect that
However, that piece of information, the serial number uniquely identifies
you as having that unique implant. You have to have that in order to get back
to the patient. That is not FDA’s job. That is up to the hospital and others
who work in the health care environment.
MR. DANIEL: Just to add to that, for some of the secondary uses that we
talked about today, the benefits of the UDI for things like Sentential and for
doing comparative effect in this research, or health outcomes research. All of
those activities happen today with claims data and happen under the appropriate
HIPAA and NIH common rule provisions for confidentiality and appropriate uses
of electronic health care record data. In order to do that, you would need to
link the specific device to the patient identifier or the drug and patient
identifier and so forth.
Under Sentential, Sentential activities are considered public health
activities, and so consensus is not needed. Generally for comparative
effectiveness research and other types of research utilizing claims data, these
are activities that are using existing data that already exist as part of the
claims. Generally, the protocol would be submitted to an IRB. What usually
happens is the IRB says, okay, you don’t individual consent for this, so they
issue a waiver of authorization.
DR. SUAREZ: I think we are going to take that as our final question. Thank
you very much. Again, thank you for the testimonies. They have been very
valuable and engaging. We are going to move to our next session. We are going
to try to limit our next session. We really ask our testifiers to stick with
the five-minute rule as much as possible.
We are going to move ahead with the session. For those in our committee who
would need a break, you can take a little break. We are going to start right
now and move along. As you need to, step out and you can do it. We are going to
probably jump over the break.
Let’s just invite our members of the panel or session health plan ID to join
the table. We are going to start with Margaret from ASC X12.
MS. WEIKER: I have also asked Laurie Burckhardt to join me at the table
today. She is the X12 NTGB, which is our business work group, co-chair. She led
the ASC X12 effort in regard to HPID and OEID. First of all, I want to thank
her for her leadership in getting this done. Also, in case there are questions,
Laurie, by all means, can answer them.
This is the second time we have been here to talk about HPID. The IMs that
we considered during our first review were the HPID and the OEID were going to
be in the same database. We thought initially that database would be a public
database. Since then, we have found that it is not going to be a public
Rulemaking timeframes have to be taken into consideration. Other
initiatives. We did not want to change the submitter and receiver segments.
Those weren’t broken. Why fix something that’s not broken?
From an operational point of view, any changes made now should be carried
over, or for the most part, be carried over, to the next version. Testing and
certification needed to be reviewed and made a determination about that. Also,
a dual-use period by trading partner agreement, and I will explain a little bit
more what I mean by dual-use period.
Also, we only considered the payer loops in the HIPAA transactions. As part
of the final rule, and around the OEID, a provider could receive an OEID. We
did not address anything to do with the provider and the OEID. We only
considered the payer loops within the HIPAA transactions.
When you look at the TR3s that are currently adopted, there was a name
change to the ID that we were originally given. It was from a HIPAA national
plan identifier to a health plan identifier. We had the addition of the OEID,
which we never accounted for when we originally created the 5010 version. Then,
we had the definition of health plan and payer, and they are different.
Dual use, we have a recommendation that trading partners discuss the
following when they want to do dual use. Basically that allows a trading
partner or, in this instance, a provider to send both the current payer ID, as
well as the health plan ID within the same transaction. Then, the 835, which is
the remittance advice, would then in turn send it back.
The claim, the 837, and the remittance advice, the 835, are the only two
transactions that actually support dual use. Trading partners have to agree to
do this. Based upon that, you will see in the 837 and the 835 documents where
we tell people who to do the dual use and what to use there.
The currently adopted type technical report 3s that are impacted are the
implementation guides, many of us know. This is just a listing of the HIPAA
ones. That is current.
We also modified the four guides that are attached to the attachments. We
did not create a errata because they haven’t been adopted at this time. We went
ahead and just made the change to the guides via our registry process. When
those do get adopted, you don’t start out of the gate with a errata. We would
prefer not to do that right out of the gate. We went ahead and just modified
those four guides.
We put out the original errata. We received comments. Based on those
comments we received, we decided to make some additional changes, which caused
us to go back to public review and comment for the errata. There have been two
reviews of the errata in our changes.
We reviewed those comments that we received back. At our June standing
meeting, there were 15 comments. The original ones had 44, so we reduced the
comments significantly. Most agreed. There were two where we did not have
enough information, nor could we get that information from the submitter, to
understand what they were really trying to ask.
For the 837, what you see is what is currently in the guide and how it is
written. What we did basically was change the element note to basically say,
use PI when you are reporting the payer and use XV when you are reporting a
health plan ID or other entity identifier. We took out, if you are qualified to
receive. We took out anything related to dates.
Basically, if you are going to send a health plan ID, this is the qualifier
you use. If you are going to send a payer ID, this is the qualifier you use. As
you can see, we also, since this is the 837, put in how to do the dual use if
you were willing trading partners to do that.
We also modified the situational rule around the secondary identifier. What
you see is the original. Then, the new situation basically follows what we did
for the others. When it is required, when additional identification number to
that provided in the NM109 of this loop is necessary to identify the entity.
Then, we changed to say, you only are allowed to use this when you use the
health plan identifier or the OEID in the name loop.
All of the transactions have been modified. For the 270 transaction, and
this is a lot of the non-claim transaction and what the change is made there.
This is the current note, and this is the new note. Basically, we are just
saying, use XV when you are going to report these two. Otherwise, if the source
is the provider, use XX, which means the NPI.
The clarified technical reports have been approved. They are going through
the final stages of the X12 approval process. They have been approved by the
subcommittee. The next step would be they go to what we call technical
assessment. They are to review it for the technical piece of it. Did we mess
something up when we made a chance. We don’t believe there will be any hitch or
glitch in tech access.
After that, it goes to what we call our procedure review board. That just is
to ensure that all of the procedures were followed. They don’t look at it from
a technical point of view. They just ensure that you didn’t violate a
procedure. We don’t anticipate having any trouble making those last two
At the current time, we anticipate having these errata, which are basically
clarifications, available in the September timeframe. Tech access does not meet
until August, so we have to wait for them to meet. Then, you have so many days’
notice for PRD.
We anticipate having these available for the public in the September
timeframe. Those are the clarified technical reports. That is the end of my
testimony. Laurie and I will be glad to take questions after everybody else.
DR. SUAREZ: Thank you so much, Margaret. Laurie?
MS. DARST: I am still Laurie Darst from the Mayo Clinic, but this time, I am
actually also a WEDI board of directors and WEDI health plan ID co-chair. I am
testifying on behalf of WEDI on health plan ID.
Just a little bit of background, WEDI has been seeking feedback from our
members since the subcommittee meeting in July of 2010. We have held several
policy advisory groups, as well as technical advisory group committees on this
A reoccurring theme, as we talked about last time, is continued confusion.
We are still confused, even from February’s NCHS hearing on what the industry
or what health plan ID is really intended to solve in the industry. We feel
that it is an important message that is being delivered and needs to be
The industry understands the intent of the original HIPAA statute was to
solve some of those routing issues. These routing issues were solved 15 years
ago, with special attention to security and privacy risk mitigation. WEDI is
concerned that in order to enumerate health plans, both government and
commercial funds will be required, diverting those dollars from being used to
achieve health care goals of greater quality of care, greater patient safety
and reducing costs.
For today’s testimony, our information covers several of the subcommittee’s
questions at one time. We want to choose two main issues that we would like to
share with you that were major issues from our membership. The first being that
there is need for clarification on the enumeration requirements for the
self-insured group health plans, especially those that are not covered entities
under HIPAA. The enumeration requirements of controlling health plans, and then
the second major issue, as it was before, concerns on the use of health plan ID
in the current transactions.
Self-insured group health plans do not directly administer their health plan
operations. Instead, they employ a third-party administrator. Under this
business model, these plans do not conduct standard electronic transactions.
With the provision of the health plan ID final rule applying to health plans,
not just health plans that conduct the standard transactions, there are
concerns that many self-insured health plans will continue to be unaware of how
the new requirement applies to them.
WEDI members continue to express significant concern that these entities may
not realize that the health plan ID final rule applies to them, and cease
educating them as significant need moving forward. WEDI recommends that CMS
conduct education outreach for the self-insured group health plans on health
plan ID and the enumeration process. WEDI is also willing to partner with CMS
to help conduct this education and collection feedback.
WEDI held a policy advisory group on certification compliance NPRM. The
attendees expressed significant concern over self-insured health plans not
conducting the transactions being required to certify compliance. It is unclear
to the industry what these entities would certify to since they do not conduct
the standard transactions, which the compliance certification process is
WEDI recommends that certification and required testing be applied to the
entities that are actually exchanging transactions. Self-insured health plans
do not exchange all of the transactions and should be allowed to use the
certification of the entities that conduct the transaction exchange on their
Any attempt to catalog these self-insured plans that do not conduct
transactions under HIPAA is thus separated from certification compliance with
the standard transactions.
As with our prior testimony is relatively unchanged. I think I will just
kind of slide over this a little bit. There still continues to be questions and
challenges specifically to controlling health plan. Many of the health plans
feel that the rule requires them to have greater certification that they have
This is further complicated. Margaret kind of touched on it a number of
times during her presentation, that there is a difference in the way the
industry uses verbiage, payer and health plan. As you listen to Margaret today,
she referred to payer quite frequently. By and large, the health payer industry
tends to use these two terms synonymously, which is starting to add to some of
However, the HIPAA regulation does define health plan differently than the
way the industry commonly uses the term. This variation of terminology use has
also created additional interpretation issues that will be addressed later in
Talking a little bit about the definition of payer, there is a distinct
difference between the definition of health plan under the regulation and the
term, payer, that is used in the standard transactions. WEDI has partnered with
ASC X12 to develop an issue brief to address this distinction in order to
provide guidance to our members, and as an industry as a whole, in the
implementation of health plan ID, in the terms of transaction use.
This distinction is critical to ensuring as little disruption as possible to
the industry in the terms of the use of health plan ID and transaction. The
issue brief is in the final stages of the WEDI consensus process and, upon
publication, we will share that with the subcommittee.
Then finally, probably one of the most significant is the continued issue
with health plan ID use in the standard transactions. Again, trading partners
of the health plan are increasingly concerned that greater enumeration will
cause disruption of the current well-functioning transaction flows, potentially
resulting in payment disruptions and accounts receivable impacts, as well as
privacy and security breaches with misrouted transactions. There is great
concern that by introducing a new, non-equivalently mapped enumeration into the
transactions, it may reintroduce past issues that have been solved.
It is also our understanding that the HIPAA database will not be publically
available to all stakeholders who will need to populate their database tables.
Access to this database is essential to complete the significant cross-mapping
that would be required to report health plan ID in the transactions.
Given these significant concerns and the lack of perceived benefit to the
industry, we would like to reiterate WEDI’s recommendation in October 2013 to
CMS that they require health plan ID enumeration, but modify the rule to make
health plan ID not use in transactions. This recommendation remains unchanged.
Then, just a summary of our recommendations from this testimony. CMS should
clarify enumeration requirements for self-funding group health plans and
controlling health plans. WEDI recommends CMS conduct education outreach to the
self-funded group of health plans, that self-funded health plans not be
required to certify compliance for transactions, and that clear, unambiguous
definition of the intent of health plan ID is necessary.
Then finally, our last recommendation that health plan ID enumeration be
required, but modify the rule to have this be not used in the transactions.
DR. SUAREZ: Thank you very much.
MS. MEISNER: I am Debbie Meisner with Emdeon. That is the hat I am wearing
today. I just want to talk a little bit about how the health plan identifier is
impacting us an organization. To put that into perspective, I am just not going
to go over this slide because I think most of you are familiar with Emdeon.
I do want to point out that we do about 7 billion health care information
exchanges. That is a year. They would all be at risk if we were to replace
payer ID with health plan ID.
The first question that you asked us to address was the impact of the health
plan ID errata. The details of the errata were covered very nicely by my
colleagues here at this panel. However, the Emdeon staff participates in the
insurance subcommittee of ASC X12 in various leadership roles. It is our
understanding that the clarification of the HPID in the transaction maintenance
documents are, as Margaret indicated, released and ready for publication. They
have gone through all of the proper steps.
Basically, the impact to us would be those transactions that required type
one errata. We would need to update and make sure all of our translations are
looking for the proper version of those. That number is carried in the GS
segment of each of the transactions.
We would need to make sure that both Emdeon and all of our trading partners
are using the right version of the transactions that were type one errata. This
may require testing, but at this point, we are thinking probably it would be
very minimal if that is the only change that is being made.
Our main issues and concerns, to answer your second question, is that
initially because of the perception that the HPID was going to replace payer
ID, it was going to be a huge impact to our transaction routing, editing and
the billing of those transactions, all relying on payer ID today.
The very granular enumeration of the health plan ID and OEID, based on the
definition of the controlling health plan, had enormous impact to both our
products and our services with a high risk of misdirected PHI, as Laurie had
indicated, leading to any kind of breach of privacy and security regulations.
There did not seem to be a standard approach to the enumeration process, and
maintenance of the HPID ongoing would have been a significant impact to us as
The last testimony in February, where it was made clear by the OESS staff
that there was a never an intent to replace payer ID with HPID, was just
wonderful news to us. It has greatly reduced our project from a multi-million
dollar, multi-year project to a maintenance-type project, to be able to take
that health plan ID, should trading partners want to exchange it. We are just
one of many who would have had to make those kinds of changes.
We do still hear some confusion in the industry on what the enumeration
process would be and how self-funded insured employers, as Laurie has stated,
are going to be notified. They are not in the health care industry, so they
probably are not tracking these regulations in the details that those of
sitting in this room do.
We would encourage more education and outreach to the employers who are
running those self-funded plants that have to go and get themselves enumerated
for an HPID. They are not in that loop.
Then, as far as strategies and best practices, again, in the testimony that
was made to NCVHS at the last meeting, there is a reference in the statement
that said there is a need to help the industry understand that the payer ID
will still be there in November. I absolutely agree to that. I am waiting
anxiously for this white paper that ASC X12 and WEDI are putting together.
Without official communication, we cannot adjust our budgets, and we cannot
adjust our project plans across the industry to say, oh, well, this huge
multi-million dollar project is really just a matter of taking this number and
passing it on. As a clearinghouse, we don’t have to use it for anything.
The current status for the preparations and plans for using the health plan
ID within Emdeon is our exchange, which is our clearinghouse services. It is
currently being remediated to accept the HPID. A lot of the work was done with
5010, but there are still a few little tweaks that need to happen.
In the transactions that cannot accommodate both the HPID and the payer ID,
we will require that the payer ID be submitted. We need that in order to route
transactions appropriately to the payer, not the health plan. NDM products will
be updated to allow a provider to submit the HPID, in addition to the payer ID,
for the claims and the remittance advice.
Some of the key issues that we are finding with the adoption of the health
plan ID continue to be in the clarification on how the HPID is to be used in
the transactions, much as Laurie has stated. We recommend that educational
materials be completed and disseminated through the webinars and FAQs, so that
the industry associations can help with the education.
We further recommend that until clear business use be defined on how these
health plan IDs are to be used in the transactions, that they be removed and
all references be removed in the transaction to avoid confusion. Again, much
like WEDI, we are saying don’t require it to be used in the transactions until
we have had any business. We have had no business requirement brought forward
to say, this is what we are going to use it for.
In closing, I would like to thank you. I look forward to some more education
on this topic.
MS. GREEN, C: Thank you, co-chairman and the members of the sub-committee,
for allowing me to testify today on behalf of WellPoint concerning the health
plan identifier. We give our testimony with the goal of providing information
to NCVHS to accomplish its task in assisting and advising the Secretary of the
US Department of Health and Human Services in the implementation of
Administrative Simplification Provisions of HIPAA. We have also filed a more
inclusive written testimony to the subcommittee.
I am Christol Green, a senior business consultant within the E-Solutions
division of WellPoint, Incorporated. I have been working on HIPAA
administrative simplification, and active in implementing and integrating
health care transactions for over 18 years. I am a current member of WEDI, X12,
HL7, NPAG and other health care-related industry organizations. I currently
serve as a co-chair of the WEDI HPID enumeration schema workgroup.
WellPoint is one of the early health plan identifier enumerators. We would
like to share our experiences with obtaining our health plan IDs with the
subcommittee. WellPoint is a large organization with many controlling and sub
health plans, both on the commercial and the public program side. We cover
nearly 37 million members in our affiliated health plans and nearly 67 million
members are served through our subsidiaries.
We hope that sharing our experience with NCVHS will help HHS improve upon
the process for obtaining health plan IDs, so that the industry may meet its
compliance deadlines. We have had several concerns with the HPOES system based
on our experiences over the past two months. We started our enumeration
processes in April of this year. The first challenge is just trying to obtain a
HIOS and HPOES access, which is difficult and time-consuming.
Every one of our health plan identifier submitters and approvers had to open
a service ticket to gain access after they completed their registration. These
tickets took 10 days to three weeks to resolve. Some are not yet resolved. We
were told by the HIOS support that the assigned HHS insurance oversight team
cannot estimate response times due to the number of tickets.
We were able to enumerate a number of our phase one controlling health
plans. One of those health plans was stuck in limbo between the submitter and
the approver. That ticket was resolved two weeks after submission.
There are minor glitches, too. One example is when I cut and pasted one of
our plans NAIC numbers within the HPID application. There is a box within the
application on the form. Then, I reviewed it and submitted it to my approver.
When my approver received that application, the number had changed. It wasn’t
the NAIC number I had pasted in that box. The application was sent back to me
for correction. When I manually keyed it in, the number, and resent it to my
approver, then it went through correctly. I did open another service ticket in
regards to the issue with cutting and pasting numbers into those boxes on the
Another item we wanted to cover was around self-funded and fully-insured
plans. We have concerns about the lack of knowledge our customers with
self-funded and fully-insured plans have about the health plan ID and the
upcoming certification requirements.
We have done what we can do to educate and answer questions. But CMS needs
to provide more education and guidance. There remains many questions and issues
which only CMS can resolve, such as whether fully-insured group health plans
must obtain health plan IDs separate from the health insurers which supplied
them with their health insurance.
As we get closer to the enumeration deadline, having clear answers become
more critical. We understand that many group health plans are awaiting further
information before they can enumerate. As we get closer, that time crunch to
the compliance period becomes an issue.
Regarding certification, we recommend that HHS allow self-funded group
health plans to either rely on certification of their business associates and
trading partners that conduct transactions on their behalf, or develop another
level of certification that maintains the reporting of covered lives and other
provisions, but does not include testing documentation and other certification
requirements for which they may have limited first-hand experience.
Thank you again for this opportunity today. I would be happy to answer any
questions at the end of this session.
DR. SUAREZ: Thank you.
MS. DAVIS: Hi. I am Gloria Davis, the EDI Development Coordinator with
NextGen Healthcare, which provides EHR, financial, HIE solutions for hospitals,
health systems, physician practices and other health care organizations for
over 85,000 providers and 4400 practices. On behalf of NextGen Healthcare, I
would like to thank you for the opportunity to respond to this subcommittee’s
questions and provide our perspective on unique health plan identifier.
As a representative for NextGen Healthcare, I have been involved with HPID
since July of 2010 with the WEDI policy advisory groups, the HPID workgroups
and also with X12N Entity workgroup to help develop the errata of the
transactions. On the first question of the what is the X12 HPID errata, I am
going to defer to what Margaret had already reported. I do want to specifically
speak to the type one errata changes for the 837 professional, institutional
and dental as a vendor, the implementation challenges with type 1 errata.
We have concerns of maintaining two versions of the X12 A37 transactions,
possibly by payer and/or clearinghouse as our providers send their transactions
both directly to payers and through clearinghouses. If the X12 erratas are to
move forward, and I agree with Ed Meisner on keeping HPID out of the
transactions, as well as WEDI, we are recommending adopting these errata
transactions prior, and I mean as soon as possible, so we don’t have to
maintain two versions of the transactions.
Another point in regard to the transactions is a dual-use period. If we do
move forward with having the HPID and the transactions, we want to make sure
that a dual-use period could go forward under the health plan ID
implementation, if health plan ID is to be included in the transactions.
What are the main issues or concerns and challenges identified with respect
from a vendor perspective? We still have concern and see continued confusion on
what health plan ID is intended to solve with respect to our current health
care industry. As I understand it, what the intent from the original HIPAA
regulation was to resolve routing issues. We have not seen routing issues for a
very long time within the transactions that we help our providers send to the
various payers and clearinghouse.
We were hoping to see efficiency, workflow, automation, obviously decrease
administered time spent interacting with the health plans for our providers,
and as a PM vendor, giving them the tools to help providers become more
efficient. As an example, when we first talked about health plan ID is looking
at it and going, good, I am only going to have to have one ID for my
eligibility because currently I keep an eligibility payer ID. I keep a claims
payer ID. I keep an EAR payer ID within our systems, in order to help determine
where those transactions go.
We had hoped that the health plan ID would be able to identify payers’
health plans, and I am using that synonymously, even though those words weren’t
because I am looking on a transaction base, and I send a payer on a
If we were to be more efficient within the practice management systems,
helping our providers be able to identify who they need to send those
transactions to. We are increasingly concerned that greater enumeration will
result in disruption of the well-functioning transaction flows potentially
resulting in payment disruptions and account receivable impacts, as well as
privacy and security breaches.
Looking at it, because I feel that I am a provider advocate, being a
software vendor, is how are providers going to know when to use an HPID or an
OEID? Or when are they supposed to use a payer ID? How will payers communicate
to the providers which ID they are supposed to use in their transactions?
Will eligibility transactions help identify the appropriate ID? Will
providers need to change their insurance masters and their practice management
systems, and assign the appropriate insurance to their patients? Will providers
need to reregister their patients to the appropriate payers, if there are
changes that are needed with their insurance masters?
Then, also on the privacy and security side is what happens if they have
routed those claims to the wrong payer? Will we see clear rejections
identifying the appropriate ID or payer ID or OEID that is supposed to be sent,
so they know how to route that transaction appropriately?
What are the most salient strategies and best practices for resolving these
issues and challenges from a vendor perspective? Early communication is the key
to implementing HPID and OEID. Giving the industry access to the database and
having that database identify what ID to use in the transactions, if we
determine to move forward in the transactions.
The dual-use period to help identify and correct the appropriate IDs to use
in transactions. Then, what is the current status for us, as a vendor? Because
health plans are still struggling with the enumeration schema and granularity
that is required to be in compliance with the final rule, we have not been able
to move forward with any changes in our PM system. We don’t know what we are
going to do.
Just as a perspective from my site is that we had a national plan ID field
way back when that was built on our insurance master way back when, and thought
that I was going to be able to do some kind of easy mapping. I am not sure
because I don’t know what my providers’ insurance masters are going to look at.
We also have not been able to address the changes until the adoption of the
errata documents on there. Again, we are one of those companies that wait until
we see that something is moving forward before I can go and ask for changes to
Clear and unambiguous definition of the health plan ID is really needed for
the industry. What is the full purpose and the scope in the other entity, OEID?
Many questions arise, including whether the OEID is used to be similar to it is
to be used with the health plan ID. Then, as X12 had said, this is not
addressing it, but still, it is part of it. OEID using for atypical providers,
we just don’t know.
Reporting of the OEID and transaction is not clearly addressed. Then,
addressing the definition of a payer and what it means to the definition of a
health plan, I am really looking forward to the WEDI white paper on that to
help us determining what the difference between the payer and the health plan.
TPAs, ASOs and certification of compliance from a vendor perspective, we are
not sure what the impact is going to be and how it will affect the transactions
at this point.
Then, the last part, there is a lot of talk about controlling health plans.
It seems that each entity is handling differently and struggling with the
definition of the controlling health plan. I just want to say that NextGen
Healthcare supports the continued effort of all stakeholders towards meeting
the compliance state, but stress we need to continue collaboration and
communication among the industry and achieving this end goal. Thank you.
DR. SUAREZ: Thank you. Why don’t we move to questions from the committee. I
will start and maybe others can join. Very interesting and valuable testimony.
It is clear in my mind that we have the right ID in the payer ID. That is the
one that everybody is going to expect to use, and that is the one that is
My question for Margaret and for the standards group is, with the adoption
of the changes to the implementation guides, do you feel that we are properly
handling and addressing or supporting the submission of the payer ID, and
whatever comes in the health plan ID field is whatever comes in it? Are you
confident that with the standard being adopted, that will be the case? The
second part of it, of course, is your expectation that this will require
because of being an errata, a rule-making process?
MS. BURCKHARDT: I am going to take the first one. I am Laurie Burckhardt on
behalf of ASC X12N. Yes, we believe with the current round two of the changes
that came out of the errata, we are silent. We are just saying if you are going
to use a payer ID, use qualifier PI. This is where it goes. If you want to
report an HPID, use the XV. This is how you do it.
The 837 and the 835 transactions allow dual use, so we provide instructions
on how to do that for both. We are silent on the mandate. We are silent on
before and after the mandate. We took all of that out and we are just agnostic
in just making sure that the transaction will move forward. Lessons learned is
we no longer try and guess what the government may do.
MS. WEIKER: To add to your second question, Laurie and I have been in
discussion with OESS since we first started this process and did the initial
evaluation. According to what we currently understand is it will be a
notification. This does not require rulemaking. The changes we are making do
not require rulemaking. This will just be a notification.
MS. GOSS: Is that in writing?
MS. WEIKER: There is an email. I have an email.
MS. BURCKHARDT: Just to go on, the only reason why the 837 transactions are
an errata type one is because there is this value element, SBR09, where it says
this is the insurance type code. What happened was is we thought the health
plan identifier would replace that value. Right now, it is used how is, is
Medicare secondary, primary? Is there Blue? Is there Tricare? It is those other
We assumed that was going to be replaced. The element is situational. It
says that it is required until health plan is mandated. Well, we needed to fix
that because the element is still required, even after HPID. That is the only
reason why we had a type one errata.
DR. SUAREZ: There are different types of errata and the implications of
MS. WEIKER: Right. There are basically two types of errata. X12, we say type
one and type two. We are changing our verbiage, and it is going to be
maintenance or modification because that is what OESS uses and has been
Type one errata equals modification. That is a change that would require
both trading partners to make a change. Type two, which is maintenance, would
be we are changing this, but a trading partner can decide to change it or they
cannot. Both don’t need to change it to have a valid transaction.
Because the SPRO9 is required today, and it is required tomorrow, software
vendors will not have to make that change to their software. The only thing
that would need to change would be the GS value. It is a one-number type of
change. Henceforth, why it is just a notification.
MR. SOONTHORNSIMA: I heard the only change that we would have to do as an
industry is to have the self-insured maybe register if they are HPID, correct,
and of course, further education. Those are the two points.
MS. WEIKER: No, I don’t think I said that. Maybe somebody else did. I did
not say that.
MS. DARST: I think there are a lot of questions around the use of the HPID
on self-insured health plans. That is what has been brought by a few of the
testifiers, that there are concerns. Clearly, the health plan ID applies to
every health plan. One of the categories among several is self-insured health
plans. The use and applicability of it is what is in question, I think.
PARTICIPANT: Right, and the X12 transaction will say, if you are
self-insured, if you are this, if you are that. They don’t go there.
PARTICIPANT: There are really two main issues. I am speaking as an industry
representative for WEDI. It is really coming down to the enumeration question
of the self-insured. What are we doing that? Then, just maybe some more
guidance for some of the controlling health plans.
The other piece is simply take the use in the transactions and make them not
use. I think most all of us have testified, although X12 is being agnostic, the
challenge is still there. There are still a lot of questions. I think there is
more wiggle room being agnostic, but the challenge is still there. What we are
really recommending is have it not used in the transaction.
DR. SUAREZ: Debbie?
MS. MEISNER: I just wanted to clarify because I did try to, for the sake of
time, rush through some of that. You will see it in my written testimony. We
fully intend, and several of my cohorts in the clearinghouse business, we will
let people know in our companion guides that we will require our payer ID,
period. If you want to send the health plan ID, we will be happy to pass that
on if the payer wants it. If you two have a trading partner agreement to pass
that, so the transaction allows that to happen.
Right now, unless something else changes, based on that testimony in
February, we are taking that to mean the health plan ID is not replacing the
payer ID. We can still require it. As a clearinghouse, we can still require the
use of that payer ID in order to help us with our transmission of data. That is
the direction we are going, unless we are told we can’t.
MS. GOSS: Laurie, when you just spoke to that problem remaining, and
although X12 is being agnostic, they have gone through the motions of creating
errata. If the proposal that I heard from both WEDI and beyond, backed by
others, is to not use the health plan ID, does that mean we are back to errata
again to make the field not used? Don’t we have to sort of solve that problem
before we do anything else, Margaret?
MS. WEIKER: Well, there would have to be a comment submitted, and there was
no comment submitted to do that in this last round of errata. If that is down
the path that we would go, which takes time and money, once again, as I
understand it, this would case rulemaking to take place. This would be an NPRM
for the errata to be adopted, as I understand it.
DR. SUAREZ: It is different for the additional errata is what you are
MS. WEIKER: Right. Well, I would have to basically table all of the work
that has been done, create new errata, go through that whole process, which is
not a quick little thing to do, by volunteers. Then, once that was done, and as
the process went through, we would go to EOSS and say, these are now the
changes we are making. We are removing all of this from the transactions.
I believe that level of deletion would require rulemaking. That is my
opinion. We haven’t gone to OESS, so they may have a different one. Based upon
the definition of maintenance and modification, I believe it would be
MS. GOSS: Nobody would be able to really do anything until a formal action.
It is too late on the X12, so we will have to put a whole new request in. Or
somebody has to go to the feds and ask them to change.
DR. SUAREZ: There is one possibility I have been thinking about. I am sure
others are. One is the interpretation of what is it that is required to have
the health plan ID in the transaction. Right now, the standard based on the
current errata is agnostic. It is we are going to put in there this space. If
you need to send it, you send it.
The argument could be is, based on some of the other things that we have
heard in the way data is included in transactions is, you are required to use
the health plan ID, if you think that you are going to need the health plan ID
in order to process the transaction, for example. In other words, yes, the
health plan ID is there to be sent if you need it.
Now, payer ID is going to be the one that is pretty much needed. The health
plan ID, it might be possible to find a way to interpret the current regulation
and perhaps guidance that you only need to send it if you need to use it in
order to process the transaction. Something like that, which is consistent with
the general how, like a FAQ.
In other words, forcing all the industry to send a health plan ID, in order
to meet the letter of some particular interpretation of the law, would not be
consistent with the administration of publication really. What we are trying to
understand or find a way now is how to ensure that the industry, while the
standards allows to send the health plan ID, how can the current regulation
that pushes the requirement to use the health plan ID in the transaction be
interpreted to, say, that if you need it in order to process the transaction.
Maybe 90 percent of the time, you don’t need it to process transactions. You
don’t need to send it.
MS. DARST: Walter, you get to the WEDI’s issues brief that we have been
working with X12, without talking about it a whole lot, since it still needs to
go through a vetting process. Because throughout the X12 transactions, no one
talks about health plan. It is just not a term as an industry we use. We call
it payer. Payer is the entity provider send claims to. It is the entity that
providers receive eligibility from.
It is kind of a processing of the transactions. You kind of see where we are
going. Since X12 is the one that is using this term, that is why it was so
important for them to be part of this issues brief, we are looking for, in
addition to the agnostic, do we have the ability to work with X12 to define
what is a payer. If the payer is like a processer of these transactions, do we
have the wiggle room we need?
The problem, and Debbie talked a little bit about the NPM’s point of view.
That is us sitting here at the table. There are masses of people out there that
are listening to say, this rule says I have to do this. I think there is still
mass confusion. I think we have some wiggle room, but there is still going to
be mass confusion. That is why we, as WEDI, would prefer just take it out or do
not use it in the transactions. Take that wiggle room. Take that interpretation
out of the way.
MS. MEISNER: I think to Alex’s point, I think it is agnostic right now. We
could get, with clarification and a FAQ, something official. I can talk to my
customers until I am blue in the face and say, nope, is still going to require
it. We are putting it in our companion guide, and we are going to do this. If
they don’t have something official that we can point to and say, look, this is
what NCVHS has said, or this is what CMS has said.
Honestly, I love WEDI and X12, and I am very much engaged in all of it. But
there is a whole segment of the industry out there that doesn’t know they
exist. They want something official from the government. Right now, they say
the transaction says if I identify a health plan in the transaction, I have to
use this number. I am a health plan. Yes, but your role in this transaction is
a payer. Well, I don’t understand that. I am a health plan.
Without that clarification, I have heard some payers say, well, we are just
going to use our health plan ID as our payer ID. Well, so you are going to make
every one of your providers change your software system from a five-bite number
to a ten-bite number, and change all of their insurance masters to accommodate
a ten-bite number because why? You can still use your payer ID. This is what
people know you by.
In full disclosure, half of them don’t know anything about NCVHS. I can
point to the testimony and say, here is what was said. Okay. The rest of the
industry doesn’t understand that. They just don’t get it. We need something
official that we can point them to, that says you do not need to use it. Then,
maybe by the next version, if we have had that clarification, and there still
has been no business need, now X12 can make those changes, if that is the
direction that we need to go.
DR. SUAREZ: Larry, I think you have the last question on this panel.
DR. GREEN: I want to thank this panel for making me feel much better about
being a doctor. All the criticism we doctors get about talking to patients in
the language that they have no idea what we are talking about. Now, I can refer
to you guys that there are other people that (static).
Could you help me out here a little bit? Maybe I will direct this towards
you. In the instance, let’s pretend that there are two boxes that are going to
have to have digits put into them of some sort, one for a payer and one for a
health plan. Just give me two or three real-world examples where those numbers
would not be the same.
MS. MEISNER: I can give you a real-world. If Emdeon is a self-insured health
plan, as such, we would have to go out and get an HPID. We do not process our
own claims. Those claims go through whichever health plan we are using. That
changes frequently. Every year, every two years or so, we will have a different
health plan, a different payer, sorry.
For example, ABC Insurance Company is administering our health benefits
today. We pay for it. Emdeon, as an entity, pays for them. Any self-insured
health plan does that. They sponsor it, right? They fund it, but they don’t
In the transaction world, the provider only cares about these claims have to
go to ABC insurance company. The transaction today does not identify Emdeon’s
health plan anywhere in that transaction. That is the difference.
One is what is the health plan, based on the definition now of controlling
health plan, versus who is administering the health plan. It may be one or more
or several. You may have a health plan that is doing your dental. You may have
a different payer that is doing your dental. I have educated myself to switch
to health plans.
You may have a payer that is doing your dental, another payer that is doing
your pharmaceuticals. You may have another payer that is doing your behavioral
health. A health plan may have multiple administrators of their benefits.
GREEN, L: Right. In that last example, when you started listing these other
things, all those other folks might have the same.
MS. MEISNER: They have different payer IDs today.
GREEN, L: They have different payer IDs, but they might have the same health
PARTICIPANT: Next year, they may change, which is one of the certification
confusions that everybody is having is, so who am I certifying, the
administrators that I have this year as a health plan, or am I going and
certifying every year, every time I change who my administrators are for each
of my different benefit packages that I have? It gets very confusing very
GREEN, C: Just to add on from the payer perspective, with the self-funded,
it is still even more complicated than that because of how the rule is written
on the health plan ID with controlling health plans and sub-health plans today.
For example, we may have one payer ID that covers all of, say, Anthem of a
state. Under the regulation now, we have multiple controlling health plans in
that state. It is not one health plan ID for that payer ID. It may be two. It
may be four.
If we went to sub health plan, it would even be more. It makes it very
complicated for the provider to know what to use. It is not on the insurance
card. It changes. I might go from an HMO to a PPO, which now I have got a
different health plan ID. It is very complicated.
GREEN, L: Is the patient involved in this at all?
GREEN, C: Only when they get the bill because nobody knows who to bill.
GREEN, L: Will they know who they are getting that notification of, that
somebody didn’t pay and now they need to pay? Will they know where that comes
from or will that just be a weird, strange address on that?
GREEN, C: We haven’t gotten there yet.
MS. DARST: I think the biggest fear for the patient would be, if indeed this
was widely adopted, if indeed it was required to have health plan ID for all
quote health plans. We have a significant risk of privacy and security
breaches. We basically take the apple cart and throw it all up. That is our
patients would be impacted. They would go to potentially the wrong place, our
MS. DAVIS: The other piece of it is that we know that a lot of providers, if
they get a rejection, they move the balance to the patient because they don’t
know who the payer is. They don’t recognize it. That is the complication, that
now the balances are moving to the patient.
GREEN, L: So the patients are involved, but they have no idea that they are
involved. They have no idea what to do with it when they are involved. Is that
close to correct?
DR. SUAREZ: With that, I want to thank you again for the testimony. This
was, again, very valuable. We are going to take a five-minute break while we
switch the members of the panel. We will go right after this break to our final
panel on ICD10. For those panelists on ICD10, if they can begin to join the
table. For those who need to take a five-minute break, we can do that. We will
be back in just a few minutes.
DR. SUAREZ: We are going to go ahead and start again. Due to the schedule,
we are going to do a couple of switch moves in the order of the testifiers. We
are going to start with Sue Bowman from HBMA and then Rhonda Buckholtz from
AAPC. Then, Sid from AHIP. Those are the three initial ones. Then, we will
start from the top. I am sorry. Did I say Sue Bowman? It is Holly Louis, HBMA.
I am sorry.
MS. LOUIS: Thank you. My name is Holly Louis or Sue Bowman. I am the chair
of the ICD-10 committee for the healthcare billing and management association.
Thank you very much for allowing us to again talk with you about ICD-10
HBMA is a key stakeholder organization representing the third party medical
billing industry. Annually, our companies submit an estimated 350 million
initial claims. HBMA members also frequently perform all of the practice
management functions, accounts receivable management and consulting type
services to our clients.
HBMA has been providing education and tools to assist our members and their
clients in preparation since 2009. We are well aware that this is not simply a
coding change. It is changing the payment model, and therefore has the
potential to be extremely disruptive to the entire health care universe.
Ladies and gentlemen, what I would say to you today more than anything is we
have a credibility problem. More and more of our clients, our physicians, our
practices, don’t believe ICD-10 is going to happen at all.
HBMA and almost every other organization represented here today have been
bringing you the exact same message for the past three years. We could probably
give each other’s presentations. End-to-end testing is absolutely critical for
successful implementation. The term ready doesn’t mean anything until that has
Equally important, we believe that end-to-end testing can assuage the fears
of payment disruptions or payment cessations. It can also serve to help dispel
the belief or the rumors that ICD-10 is not going to happen.
Perhaps the most important lesson learned from 5010, and most recently
AQA(?) was that testing was too little. It was too late. There was no time
allowed for corrective actions and/or remediation.
Delaying testing into well into 2015, and we have already had payers tell us
they will not test until July of next year, is too late. If past is prolonged,
implementation never goes as smoothly as promised, or as accepted or hoped.
We again ask this committee to encourage both CMS and the secretary to
establish periodic benchmarks that cannot be ignored to assess the status for
all facets of the health care industry. Differing these mission critical steps
until 2015 is squandering a golden opportunity for true readiness preparation.
Given the delay until, we assume, October 2015, many payers, as I said, are
again announcing that they are delaying. We have to really question where those
who said they already or would be ready this year, was that a true statement?
If so, why are they deferring so long?
Last month, we did a survey of our members to try to take a pulse of where
we are. Fifty-eight percent responding billed for smaller physician practices.
Forty-three percent of the coding is done by the physician clients and their
practice. Forty-seven percent of the EMRs are not ICD-10 enabled or tested.
Seventy-four percent of our members’ clients supported the delay, where only 6
percent opposed it. The rest were neutral.
Eighty-two percent have not been able to conduct any end-to-end testing to
date. Of those who were able to, 38 percent said it was not successful, which
was very different than the syntax finding from CMS from their max.
We think these findings mirror a lot of the information at the recent WEDI
meeting and other venues. Many small providers are cash poor. They don’t have
certified coders. The promised super bill ease maybe does not fit the practice.
They are delaying due to resources, not obstinance. In our own practice, not
speaking for HBMA, speaking for me, we have had to scale back on our money, our
efforts and our dual coding because we just can’t continue to support the
financial drain that that imposes on our business.
Our recommendations are we must know if 2015 is really the date. We need an
absolute go or no go. We can’t just keep going with a maybe next year. Without
this certainty, providers will continue to scale back on money and resources,
focused on ICD-10 implementation and put them toward other realities.
Assuming October 2015 is the implementation date, we must use this year for
additional end-to-end testing and real end-to-end testing by all payers. Syntax
testing is merely a milestone marker along the way. We believe that there
should be periodic benchmarks to allow meaningful analysis of the industry as
we move ahead in progress.
We recommend CMS convene an industry stakeholder group of representatives
from the small providers, small entities, organizations and companies as soon
as possible. We can’t afford to continue to ignore the barriers for readiness
that some of these groups seem to be having and cannot overcome. The answer is
not simply more education. The providers who are not ready now most likely
won’t be ready in 2015, either.
On behalf of HBMA, I thank you and appreciate your willingness to listen to
us again. We have submitted a written tome for your review, if you would like
to see more in-depth answers. I apologize. I am going to have to leave. If
there are questions, our executive director, Andre, is here, and he could
forward those for us. Thank you.
DR. SUAREZ: Thank you, Holly. Rhonda, you are next.
MS. BURCKHOLTZ: Thank you for allowing the AAPC to participate in today’s
meeting. AAPC is the nation’s largest training and credentialing organization
for the business side of health care. Our membership is most widely known for
our certified coders. However, our certified members include medical coding,
billing, medical auditing, compliance practice management, and represents the
highest level of expertise in the industry.
Currently, we have over 131,000 members. We have trained over 90,000 people
in ICD-10 education and services, ranging from implementation, mapping services
and decoding training. Our clients represent not only our own members, but also
facilities, health plans, governmental agencies and others.
About half of our membership has identified themselves or profiled
themselves as working in a physician’s office. Then, the rest break up into
health plans, ASCs, instructors, consultants and those types of things.
We wanted to get a good picture of where the industry was and where the
future hurdles were going to be. We sent out a survey of 5000 of our members to
get an idea. Honestly, we were surprised with the results that we had received
with these surveys. We, too, believe that many in the industry weren’t as ready
as what we thought they might be and believed a lot of what we had read.
We asked the question, where was your practice prior to the delay? Thirty
percent were still in the beginning stages, 25 percent had completed all
training, 23 percent said they were actively testing with various vendors, and
13 percent indicated they were done with it all and ready to start using
ICD-10. Those numbers, to me, were just a little bit surprising.
We then went on to ask a follow-up question of, has your practice performed
any type of testing for ICD-10? The results were what we expected here, what
remains one of the largest hurdles for moving forward. I think these numbers
kind of represent it. Forty-eight percent have not done any testing.
Thirty-eight percent had done some form of testing, and about 8 percent said
their vendors were not prepared.
Now, they did, as a follow-up, name the vendors that told them they were not
prepared for ICD-10. I did not share that in this presentation. I will say that
two large spenders were identified as telling practices that they were not
ready to do any testing prior to the announcement of the delay.
We asked the practice, regardless of your vendor, were you, as a practice,
personally ready? If your vendor would have been ready to go, would you have
been able to go? Seventy percent said yes, they felt confident that they would
have been ready for testing and ready to go for ICD-10 implementation. Twenty
percent said no, and then the rest of the respondents said it was not
applicable for their position.
Then, we asked what we think is the most telling, and that was what was your
biggest concerns moving forward or trying to get ICD-10 implemented in your
practice. The first one, and I will tell you some of the comments that were
behind some of this, was unclear messaging from CMS.
The most recent was the canceling of the testing that was scheduled for
July. We understand why the testing would be delayed, it didn’t say we were
delaying testing or the reasons why. They said testing is canceled until
sometime in 2015. That stops the industry, when we make comments or when you
send out information like that. Because then, everybody sits back, and the
comments were, this just seems like it is setting up the stage for another
delay. People don’t want to move. They want to sit, and they want to wait.
Unclear messaging, AMA opposition. The threat of another delay. Vendor
readiness. IT issues. Training of physicians (static) aren’t ready. Mixed
messaging, documentation, testing, credibility and claim delays. Those were all
the most repeated areas of concerns that we received from the respondents on
Some of them, I think, can be fixed, but then there are others that are on
this list that, quite honestly, I couldn’t give you an in-depth answer on how
we would be able to go around fixing that. I think clear messaging from the
industry is very, very important. There are so many mixed messages out there in
the marketplace. We have got to really start to take a look at what the real
AAPC is doing what it can in the marketplace to show what the key hurdles
are and what the myths are in implementation. We have started to promote the
potential positive aspects of the new coding system.
We also, interestingly enough, started calling past clients and started to
do a study on how much did they really spend for ICD-10 implementation. Now, we
could only ask those that said they were completely ready, finished with their
training and ready to go. The numbers that I am going to give you do not
account for staff training time. It does not account for the extra expenses
that practices are going to incur as a result of the delay.
However, I do think that you guys are going to be very surprised as to what
we found out. What we found out was that the practices or facilities that did
engage with AAPC for their implementation had far less costs associated than
what was indicated. Overall, our study so far has indicated that, on average,
it is costing physicians $1600.00 per provider.
If you break that down, small practices with fewer than 10 physicians
average $750.00 per provider. Medium practices broken down as between 10 and 49
averaged $575.00 per provider. Then, for those practices or facilities with 50
plus physicians, the implementation costs averaged around $3500.00. Quite
simply, the jump in that number would be because they have more complex systems
that range across things, and then therefore, had more IT costs that went along
Now, these costs included everything they needed to be ready to implement.
Like I said, it was only for those that were able to say and attest to us that,
yes, they were ready. They felt that they were still ready to go. It does not
include the cost of delay or the cost of training staff.
We believe that more of these actual studies should be done with these types
of organizations to indicate the readiness. Let’s start sharing some success
stories of those that tested and were successful what the true costs of
implementation are and where the real hurdles are going to be.
We have also been completing productivity studies with those trained, who
have been doing dual coding. What we find is that immediately after training,
you are going to see about a 20 to 28 percent productivity loss immediately
after the training. After working in the codes for six to eight weeks, we are
seeing the productivity levels go right back up to what they were in ICD-9.
Again, there are numbers out there that, if we can continue to do these
types of surveys and studies that will show, it is not going to take years for
productivity to come back up. It is not as bad or as expensive as what we once
We plan to continue to monitor productivity in our trainings. AAPC has also
made the commitment to make sure that money wasn’t wasted on education due to
the delay. It is not the fault of those that have already trained that there
was yet another delay.
We also realized that we need a way for people to not feel like they should
just stop preparing. To that end, anyone who has received code set training in
the past, or prior to September 30th from AAPC is going to get free
monthly refresher webinars to make sure that they continue learning. We have
also extended access to our online courses, to those who have purchased clear
through December 31st of 2015, so that they continue to retrain and
the education isn’t lost because it is not the fault of the individuals that
have already purchased their training. They did due diligence to get ready on
time. They shouldn’t have to pay extra just because they listened and believed
that it was going to be there.
We also extended the timelines for our physician education to those same, as
well. We have created free coding tools, resources that are on our website,
offered free mapping crosswalks by a WEDI to help physicians, as well. We do
offer free implementation tools for everything that I just mentioned. Other
than the free refresher webinars, you don’t even have to be a member. Those are
free to the public. They can be there and shared with their offices.
We have over 500 local chapters across the United States. We have been
providing them with free education updates, as well, to make sure that we can
continue to keep the cost as low as possible. The problem is that we need the
credibility, like Holly said. We need some good, solid communication.
I have heard from a lot of people that until it is printed, and there is a
final ruling, they are not going to move forward. The memo that came out from
CMS, that said, hey, we are looking at the October 2015 date. It isn’t enough
for them. They want to see it in writing again. We need to make sure that we
have clear messaging as we move forward down.
I had one other slide, and it is really another request on how we can
actually make things better in the industry. Right now, we know that there are
many mistakes in the ICD-10 codes. We are holding onto them under the code set
freeze. That is very detrimental to the industry.
People in the industry are being taught wrong. There are mistakes in the
guidelines. There are codes that make no sense. We have reported them. They
need to be fixed. People are setting up their systems. Practices are setting up
their systems. Education is being given. All we can say is, we believe this to
be a mistake.
Until the code set freezes up, and until they decide, that is going to
happen right when we are implementing. We are causing more chaos. We are
causing more grief. We are causing more expense in the marketplace. We need to
release those now.
Along that same sense, AMA got it right a long time ago. They opened up
their CPT panel to everyone in the industry. They have coder representation
from both outpatient and inpatient, hospital organizations, as well. They allow
specialty societies to participate open.
You need to broaden up the cooperating parties and allow more to
participate, rather than just the two meetings per year. You need to have a
larger panel. You need to have more representation on this, so that providers
are represented on this, so that people have a good understanding of how
providers’ offices work and how these codes will impact them, especially as
payment models shift towards diagnostic coding, as well. Now is the time that
we need to be able to make a difference. We have got to be able to get that
DR. SUAREZ: Thank you so much. Sid?
MR. HEBERT: Thank you to the subcommittee for having me here for this
discussion on this important topic. We have another delay. Let’s talk about it
for a minute. My name is Sid Herbert. I am the ICD-10 program director for
Humana. My primary responsibility is to assist Humana with implementing to
revise HIPAA electronic standards, the ICD-10 code set, administrative
simplification mandate by the Affordable Care Act.
Humana is headquartered in Louisville, Kentucky, and is a leading health
care company that offers a wide range of insurance products, and health and
wellness services, that incorporate an integrated approach to lifelong
well-being. Today, I am testifying on behalf of America’s Health Insurance
As you all know, the migration for the ICD-10 code set will have a major
impact on business and administrative operations of health plans, and will
require significant financial and human resources for successful
implementation. Insurance agency remains committed to the implementation of
ICD-10. Health plans have invested a tremendous amount of time and resources to
be ready for the October 1st, 2014 deadline.
To date, ICD-10 has been delayed twice. Actually, it has been three times.
This must be the last delay. My belief is that it will be the last delay
because, if it is delayed again, you will probably see an industry
disconnection from the process.
Each delay brings significant cost and additional administrative challenges
for plans and providers that are ready for implementation. It penalizes those
who invested the time and resources necessary to implement on time. Further
delays will also prevent providers and payers from leveraging ICD-10 to improve
patient care and clinical outcomes.
As I indicated when I spoke to the subcommittee in February, Humana began
planning and executing ICD-10 implementation in 2009 because we recognize that
this complex coding system requires careful and systematic management for
successful implementation. We have continued to work without a break on ICD-10
through the delay. What we have pleasantly discovered is that, at least on the
major facilities’ standpoint, they are continuing to work along with us at the
Not everyone in the industry is taking a stand-down approach. I can assure
you that I have talked to many people who we haven’t quite engaged with yet, or
are planning to, that very soft in their commitments.
Today, I will speak to how we must all work together to ensure that there
are no further delays beyond October 1st, 2015 soft date. Once
again, we need the documentation. We must not rely solely on CMS to ensure
industry readiness in 2015. Instead, collaborate with CMS to ensure a smooth
This collaboration requires five things, which I will talk to in detail.
First of all, we need a collaborative approach. Up to now, we have, as an
industry, looked to CMS to set the benchmarks and the guideposts, and have
been, I think, a little pointed when CMS didn’t follow through.
I have changed my view, and I believe a more collaborative approach is going
to be required. Focused on provider readiness, on vendor readiness. When I
speak to vendor readiness, I am really speaking to the practice management
systems and the systems that providers are dependent on. Ongoing support for
implementers. We have done a pretty good job of putting a lot of checklists
pre-implementation. We haven’t done a really good job of providing detailed
guidelines for how do you implement something that is complex.
We also need a collaborative approach to focus on testing. The one thing
that we have to do and get right is testing. The one thing that we are most
reluctant to embrace is collaborative testing.
Let’s talk about the focus on provider concerns. The recent enactment of
H.R. 4302, Protecting Access to Medicare Act, demonstrated providers still have
numerous concerns about the adoption of ICD-10. To me, this demonstrates a need
to better educate providers regarding what exactly they need to know to
successfully submit ICD-10 claims.
Successful implementation of ICD-10 comes down to the plain and simple fact
that providers will need to understand how to code correctly. I recommend that
providers consult with AAPC. There are tools that are available out there to
help them demystify this coding problem.
Rhonda just mentioned that they have 20 specialty guides they offer as a
pre-service to WEDI. Those guides are very good. We use them to calibrate some
of our early coding. What they do is they show, at a specialty level, that we
are really not talking about 185,000 combined codes. We are talking about 100
to 200 codes with very explicit coding guidelines. That is much easier to
digest and embrace as a provider than this massive code set that we continue to
Providers need clear step-by-step guidance on what they need to do to get
ready for ICD-10. While WEDI has issued implementation strategies and plans,
providers need a more detailed implementation guide, as I mentioned. These
guides need to be easily customizable for various provider types. CMS should
drive the effort and help us coordinate and collaborate together, to develop
these and disseminate these guidelines.
On the vendor readiness front, I think WEDI has an opportunity to
participate in a leadership role, but will need some of the muscle of CMS. In
addition to readiness, some of the key pieces of the puzzle are practice
management billing systems used by most, if not all, of the providers. Having
ICD-10 certified practice management software and systems ensures providers
will be ready by the deadline, and minimize the number of partners that health
plans have to test with. The reason this is important is we are not, as payers,
I am going to stick with payers. We just heard that there are health plans, but
I will stick with players.
From a player standpoint, there is a limited range of how many people we can
test with. I have talked to all of my counterparts for the major national
plans, and they have the same issue. Who do you select and focus on? You can’t
deal with 500,000 providers. The best metaphor for testing and certification is
to use the tools that the providers use and test with them.
We are talking about roughly 400 PMS systems of various penetration in the
marketplace that multiple players could easily test with all 300 to 400 of
them. Once certified, a provider now has assurance that, if they code correctly
and enter a claim with correctly ICD-10, it should process through to the payer
and a valued response would be returned.
It is imperative that I think that a program, similar to the WEDI/EHNAC PMS
vendor certification program, be implemented and endorsed by CMS. By the way, I
am doing commercials for everybody in the room.
Ongoing support for implementers. It is very easy to lose track of where you
are the process. It is very hard to find good quality information on
implementation. To provide ongoing support for implementers, we recommend that
CMS create and manage a repository of the best industry education collateral. I
know that my company is building collateral. All of my counterparts are
building collateral. WEDI is building collateral.
You just heard from Rhonda, and I know the same is true for Sue Bowman. We
are all creating this collateral and distributing it to the best available
channel, pushing it through every medium we can find. If we can get to a point
where it is collated, tracked and then published with one source for people to
pick up that type of material, I think it would be a big benefit.
From an implementation approach perspective, some stakeholders continue to
advocate for dual implementation timelines, separate implementation dates for
physicians and facilities. We believe this approach is unworkable. I hear this
over and over as a short-term fix for this problem.
Simple things that we do day-to-day in this industry will no longer
function. Simple things like coordination of benefits. If I, as a payer, am
ready for ICD-10, and I receive a claim that isn’t ICD-10, and I process it and
then pass it on to the secondary payer, if they are not ready for ICD-10, we
have a real problem because there is no connection back to the provider, the
original submitter. There is big opportunity for things getting lost in the
process. That is the way we can make this work.
We will continue to support the implementation approach.
DR. SUAREZ: You probably need to wrap up, if you don’t mind.
HEBERT: I will take one minute on testing because I do have a lofty paper
you can read. From a testing standpoint, we have worked with about 54 of the
major national hospital plans. Thirty-four of those are actively involved in
our three states testing program.
The three stages are stage one is a testing exam actually. Can we code
effectively in ICD-10. Stage two is taking prior ICD-10 coded claims that are
focused very payment sensitive DRGs or medical conditions, and recode them and
evaluate them. Then, the third phase is actually processing this similar type
of work electronically.
What we have found is, A, large facilities can code and can code accurately.
B, there are variations that are explainable in the DRG shifting space that we
are working today with Tampa General to do a presentation at WEDI in July of
some of the differences that we found. Of the roughly 250 to 300 medical
conditions that will create DRG shift payment and payment issues, they are all
very explainable, either within the code set or in the application.
We believe that there is going to be a pretty straightforward expectation on
DRG payments. We are currently working on a similar program for providers. That
would be our IBAs, our MSOs, delegated provider organizations, as well as
physicians. With that, we are going to be able to produce similar results. I
can’t say enough about testing. I do endorse CMS reactivating their testing
In closing, I do want to reiterate that health insurance industry’s support
for implementing ICD-10, which has numerous benefits including greater
precision in the identification of diagnoses and procedures, improved reporting
for public health and bio surveillance, and support for quality improvement
Health plans have expended significant resources to date in implementation,
and it is critical that this momentum is sustained through October of 2015. We
recommend that CMS take steps in the five areas we have outlined in these
remarks. I do thank you for the opportunity. I would like to see us get this
thing done before I retire.
DR. SUAREZ: Thank you, Sid.
MS. GREENE: Hello, everyone. I am Denescia Greene with CMS. This is an
opportunity to really take a look at the groups that were innovators for ICD-10
and actually were ready. Those that have successfully tested prior to the
delay, and also, looking at those who were lagging behind.
We have done a lot of outreach in education, even onsite training to small
physician practices and specialty groups across the country. We have a tool out
there. It is the small physician practice tool. It has coding examples,
clinical documentation scenarios. You name it, we have taken a lot of provider
feedback and input, and developed a tool all around the small physician
practice and small groups, small hospitals, as well.
I really want to look for solutions to help the groups that are, for lack of
a better word, not preparing for ICD-10 and want to understand the challenges
more. We actually brought in several focus groups, physicians across the
country, representing different specialties, and talking through some of those
issues. Where we could, we have applied those. They are actually in action
How do we? I am going to point a question out to the people in this room.
How do we prepare or help those to prepare next year, that weren’t ready this
time around. There is a lot of question about where do we go from here? What
I think the answer lies in this room, representing groups that are in this
room and beyond. The answer to that is, how do we communicate those good
examples of how this works, how it is of value, how it is beneficial just
across the spectrum, not only in the administrative simplification world, but
across public health.
I think that as we offer up percentages and results of groups that weren’t
ready, what we need to do is dig behind that data and see why weren’t they
ready. In terms of vendors, one of the things that we have been doing, and I
think there is an opportunity here to do more of that, is to bring vendors to
We have a vendor call. That vendor call is handled monthly. We also do a
payer call. We also meet with clearinghouses every other week. We have been
doing that for quite some time.
I think that maybe now is a good time to bring all of those stakeholders to
the table, including other partner and provider groups, as well. We have
brought on rural health communities, small hospitals, critical access
hospitals, safety net organizations, physician practice organizations, you name
I am really open to solutions on how do we get those small physician
practices to the table. I will leave it there. I can let you know that CMS is
committed to testing. You saw a postponement of the testing, but not a
cancellation of testing. Perhaps the messaging came across perhaps not in the
most efficient way. There will be testing to ensure that this process goes
One of the key things that we want to make sure is there is continued
reimbursement. That there is an opportunity for providers to submit claims,
even if their systems aren’t ready. What we have been working on is looking at
risk mitigation plans and solutions that if their vendor systems aren’t ready
for whatever reason, that providers can continue to submit claims into
What we found in talking with various payers across the country is that they
were looking at very similar approaches to ensure continued payment. I think
this is a great forum to have these types of conversations. Again, I would
encourage this group to dig beyond the data, so that we look towards solutions.
DR. SUAREZ: Jim, I think you are next.
MR. DALEY: I am Jim Daley from WEDI. You are very familiar, I am sure. We
are a cross-section of the industry. We are a named advisor to HHS under HIPAA.
When we heard news of the delay, we were about as shocked as anyone else. We
said, we need to do something to figure out how to deal with this. We held an
emergency summit in April. We had 200 people there. We said, let’s not rehash
the old things. Should we move to ICD-10? Should we wait for 11? Should we keep
CPTs instead? Should we do all this stuff?
We just said, let’s assume ICD-10 will happen. How do we deal with the
consequences of the delay? How do we move forward towards whatever the new
compliant state would be?
We look at four key areas. Root causes for delay, the impacts, unintended
consequences, building a high-level road map and some specific action items
that we needed to move forward with. A summary of that is posted on our
website. We also wrote a letter to the secretary with some recommendations. The
committee has been copied on that letter.
Saying, well, the industry is behind, that is not a root cause. That is a
symptom. We said, what is the reason they are behind? One of the things, too
many mandates. Drinking water from a firehouse, everybody has got a lot on
their plates. No or limited perceived value to many of the people who have to
comply with ICD-10.
Inconsistent/negative messaging. This is a monster that is going to cost you
a whole bunch of money. You are going to have to learn 141,000 codes. It is
monumental. It is a very scary proposition out there.
Prior extensions, except for employer identification number, when have ever
implemented anything without a delay, an extension, a grace period or anything
like that? Plus the ICD-10 extensions of the past were something to deal with.
Of course, you already mentioned vendor product readiness. For many
organizations, without the product they use, they are pretty much stuck.
Impact, unintended consequences, it is not just you have got more time.
People were ready for ICD-10, and a great many were. They have to now be ready
to continue to use ICD-9. That is something that I know one vendor, at least,
was sending out patches to undo the cutover date. There was some work done in
that regard. The credibility, we have already talked about.
Frustration, are we ever going to get this thing done? We are extending this
forever. Slow-downs and stoppages, some consultants I know, they have been
releasing staff to other projects, trying to find new spots for them to work.
When the time comes to ramp up again, will they be available? This issue is
Budgetary. I don’t know how many people budgeted for ICD-10 in 2015, knowing
you would be done in 2014. There are some impacts there. Incremental costs.
Some organizations are talking about the extra year is going to cost in the
millions of dollars extra beyond what they already spent. Extending the
project, retesting, doing a lot of things. State level considerations, such as
Worker’s Comp. We have addressed that a few times. They are right in the middle
of this, as well.
High-level road map, we did just a quick straw poll, and the vast majority
of the room said single date cutover. I know Sid started to touch on some of
the ugliness of trying to do it any other way. That would require more impact
assessments for other unintended consequences. Three areas of the roadmap,
communication, collaboration, testing, tracking, readiness, transparency of
readiness and some other items. I have got them on the next slides.
Suggested actions, communication, collaboration, build credibility around a
new date. How do we believe any date that is out there? One of the things that
we could do is leading by example, the example of communicating Medicare and
Medicaid readiness. Say guys, we are done. Here is the proof. We are ready, so
don’t say that we are not ready as an excuse. We are there. We are waiting for
you guys. That would go a long way towards convincing people that this is real.
Conveying a positive message. It is not as bad as you think. Rhonda’s figure
of $1600.00, I think she said. It is not 80,000, 150,000, whatever it is that
all these monumental codes you are using. You may use 20 or 30 codes or 100
codes, whatever, but it is not 141,000. It won’t take you as long to get ready.
That messaging would be very useful, as well as some benefits that accrue to
the providers for that, or to the payers, as well.
Focus on the clinical documentation improvement. That is necessary for a lot
of good things beyond just ICD-10. Get that ready, and you have set the
foundation for use of ICD-10.
Another method to help out might be reenergize the regional extension
centers. I know for the EHRs, it is all tied together somehow. They have a
presence in the more localized community. If we could use them to help spread
the gospel on ICD-10, how to get ready, that may be a very helpful way of
moving this forward.
Expanding communication and messaging. We have got to reach beyond the
listservs and subscribers. I know CMS, there is a lot of great stuff out there,
a lot of messages going out. WEDI sends them out. Other organizations do.
If people subscribe to that, they get the message. If they don’t, they don’t
get the message. How do you push it to them? It would be like me saying, there
is a library out there with a lot of great books in there. You may or may not
If I walk up to your desk and slap a book down, and say, there is what you
need to know, that is an in your face way of really getting the message out
there. WEDI, our membership consists of many organizations that also have
memberships. We can maybe use that as like a phone tree kind of situation to
get the message wider and wider out there.
We need all means available to tell people what they need to do to shrink it
down to these re the really few things you have to do. It is not this
monumental task, and to make them aware of some of those actions. Also target
the outreach to non-covered entities that may be impacted by ICD-10.
Testing and tracking, expanding Medicare and Medicaid. Testing, quickly
sharing results, we have talked about that already. Encourage effective private
sector testing process. Volume is not the answer. It does not equate the
quality. You have got to do quality testing. What are the smaller things that
will say this works, versus do 100,000 office visits and say, I tested it.
Supporting limited pilots would be good, clear milestones and metrics. Here
is where you need to be at various points. How do you know you have met that?
You can’t just say, oh, I am done. No. If you have accomplished these following
items, perhaps some of the CMS checklists out there, if you have met these
items in there, then you can say you are done. Of course, with that, we can
then track it and get a better gauge of where the industry is. Track the
readiness and share transparently. We need support for the PMAP accreditation
Next, other considerations, assess financial impacts of the delay. Every
time it is pushed off, it is costing more money, beyond what we have already
spent. That is a consideration. Somebody always misses the bus or a glitch
always happens, so we do have to recognize that even though we want to have a
hard and fast cut over there, somebody is going to have an issue somewhere that
we need to recognize how we are going to cope with that. We could certainly use
support for all of the outreach efforts that WEDI is conducting.
Our activities right now, we will do more service. We were ready to go just
before the delay, so we held off a little bit to let the dust settle and to
rework a question or two. That is going to go out soon. We will continue to
work with CMS very closely on many items to figure out what the concerns are,
to look at how we can work together to address those concerns.
We have got the database and the issues, FAQs people can reference out
there. We continue our workgroup activity, and we will have continued program.
We have conferences and forums. With that, I do thank you for the opportunity
to testify. I am ready for questions.
DR. SUAREZ: Thank you.
MS. BOWMAN: I am Sue Bowman with the American Health Information Management
Association or AHIMA. That is a not for profit association of more than 71,000
professionals who are educated, trained, certified and working in the field of
health information management or HIM, health informatics. You can see many of
the details. In a written testimony, obviously I can’t cover everything that is
in our written testimony in my oral statement today.
Some of the challenges we heard during AHIMA’s recent ICD-10 and
computer-assisted coding summit are very similar to what you have heard from
previous speakers regarding the delay, loss of forward momentum, loss of
stakeholder attention and focus, skepticism regarding firmness of the next
compliance date, increased implementation costs and maintaining coders’ skills
in ICD-10 between now and the compliance date.
Also, employment prospects for more than 25,000 students in HIM academic
programs are jeopardized by the delay because many of these students have been
trained exclusively in ICD-10. AHIMA believes that the top priorities for focus
over the next year should be clinical documentation excellence, education and
testing. Other specific areas for focus include increasing engagement with the
physician community, leveraging technology to provide real-time documentation
improvement tools to facilitate documentation capture at the point of care.
Shortening the learning curve by encouraging ICD-10 trained coders to
continue to practice ICD-10 coding. Analyzing data to identify and focus on
high-risk areas. Conducting more robust testing, and using ICD-10 data
collected from dual coding to start to really demonstrate the value of ICD-10.
The delay also presents an opportunity to add new HIM graduates to ICD-10
projects teams. As I had mentioned, these individuals have been trained in
ICD-10 already and are an excellent source of ICD-10 expertise.
Although many stakeholders are disappointed and even frustrated by the
delay, we believe this is an opportunity to reflect, regroup and revitalize.
The extra time offers all stakeholders a chance to get the transition right and
mitigate risks caused by inadequate preparation.
What are the implications of this delay? Well, any ICD-10 delay, as you have
already heard from other speakers, is very disruptive and costly for health
care delivery innovation, payment reform, public health and health care
spending. The health care industry has made significant investments in the
ICD-10 transition. These costs continue to increase considerably with every
year of the delay, with rework as you had mentioned that has to be done,
retraining and so forth.
We have heard from many organizations that this could be 25 to 30 percent
increased costs from the previous delay, and another 30 percent of costs for
this next delay. Significant costs are continuing to be incurred just to
maintain the ICD-10 coding skills for staff who have received training. The
lost opportunity cost of failing to move to a more effective code set also
continue to climb every year that we are not using ICD-10.
The enormous investment that is being made in accountable care
organizations, meaningful use of EHRs and value-based purchasing are all
predicated on having a more precise and comprehensive diagnosis and procedure
coding system that is up to date with the rapid changes and practices and
technologies utilized in today’s health care system.
Broader research will be forthcoming this summer as AHIMA and the e-Health
initiative are currently in the process of conducting an industry wide survey
on the impact of ICD-10, including the impact of the delay. We will be pleased
to share the survey results with you, once they are available.
It is absolutely imperative that there be no further delays in ICD-10
implementation in order to start realizing the benefits of better data, as well
as to control implementation costs. To prevent further delays, as well as
achieve a successful transition to the ICD-10 codes that is in 2015, AHIMA
recommends that CMS work with public and private sector organizations to
broaden and deepen awareness of the appropriate uses of ICD-10 and to dispel
ongoing misunderstandings and myths.
CMS must help lead efforts with stakeholders to educate members of Congress
and cue White House staff on the value of ICD-10, as well as the adverse
consequences of a delay. CMS should work with other industry stakeholders to
offer training, education and technical assistance to help at-risk
constituencies, including small physician practices, which I know CMS is
already working with, rural providers and critical access hospitals, so that
they can prepare for, achieve and maintain readiness for ICD-10 implementation.
It is also imperative that all stakeholders should stay the course with
ICD-10 planning and preparation activities in order to be fully committed and
prepared for an October 2015 compliance date. CMS should work with stakeholders
to ensure comprehensive and ongoing end-to-end testing.
In conclusion, avoiding further delay, an ICD-10 implementation is critical
to limit implementation costs and also to be able to begin to leverage the
opportunities anticipated by the availability of better health care data. The
quality of our health care progressively deteriorates as long as the US
continues to rely on the outdated and imprecise ICD-9 code set.
AHIMA is committed to working with HHS and industry partners through
advocacy, outreach and educational initiatives in order to prevent any further
delay in the ICD-10 transition. I would also like to mention that AHIMA has
just released a new policy paper titled, achieving ICD-10 CM/PCS compliance in
2015, staying the course for better health care, a report from the AHIMA 2014
ICD-10 computer-assisted coding summit.
Drawn from discussions and a real-time poll of health care professionals at
our summit this past April, this paper outlines challenges associated with the
delay, offers recommendations where organizations can focus to successfully
transition to ICD-10 and suggests specific steps the industry should take. We
would be happy to share the link to this paper with the subcommittee. Thank you
for inviting me to testify today on behalf of AHIMA. I would be happy to answer
DR. SUAREZ: Thank you, Sue. I think we have John Powers on the phone?
MR. POWERS: I am. I am probably going to be swimming in the other direction
from some of the previous speakers. I have co-lead the ICD-10 implementation
project at Beth Israel Deaconess Medical Center, the Boston-based medical
center, about 1.2 billion in patient revenue, for the past four years. My
comments are from a proprietor’s perspective.
The enormity of the ICD-10 project was as many industry experts speculated.
It was Y2K in scope, complexity and cost. We made substantial progress on all
fronts and believe we could have completed a transition on October
1st, 2014. That notwithstanding, there are two areas that we thought
spending more time on would make our transition more successful. One was
clinical documentation improvement and the other was growing the coding staff.
For these reasons, the reset date to October 1st, 2015 was welcomed.
There seems to be a tendency among those engaged in the ICD-10 projects to
focus on the already sunk costs. Sunk costs unfortunately are over and done.
They cannot be recovered. Future costs, on the other hand, are still in play,
and they can be avoided.
So far, Beth Israel Deaconess has spent about 2.4 million on the transition
project. These are largely one-time costs. The more significant costs, however,
lay ahead. They are the recurring costs for extra coding staff, software
license subscriptions and license maintenance fees associated with ICD-10.
We estimate these will cumulatively cost BID 16.4 million over the next five
years. Many, including myself, are appreciative of the important role the
standards subcommittee has in promoting administrative simplification.
What is troubling is that the efforts do not appear to have impacted in a
positive way the percentage of our budget that is spent on administrative
overhead. To the contrary, we have seen our administrative overhead increase.
ICD-10 PCS is especially challenging to implement. We suggest that you
reconsider placing CM and PCS on separate tracks. CM has the benefit of having
been used for years in other parts of the world and in limited ways in the US.
Not so with PCS.
The authority upon which ICD-10 mandate was built is HIPAA’s administrative
simplification provision. The benefits case put forth so far, however, is vague
and has provided nothing at the medical center that looks or feels like
administrative simplification. This is likely contributing to the lagging
activity by some of the providers and payers that have been pointed out today.
I hate to throw cold water on the efforts made today, but it is time to hit
the pause button on ICD-10 and reexamine whether this initiative is moving
administrative simplification in the right direction. When the ICD-10 impact
statements developed by Rand, Nolan and others were completed, they needed to
rely on limited data and speculative forecasts. The more recent fact-based
knowledge gained by payers and providers, and implementing ICD-10, should now
The answers to the three questions asked in the 2004 Rand study should be
updated. What are the costs and benefits to switching to ICD-10? To PCS? To
doing them sequentially versus simultaneously?
I would especially encourage a validation of the benefits cases. Knowledge
gains in the last few years confined to an estimate. It is not a meaningless
exercise. We need to assure the estimated costs still to be incurred are
accurate and more than offset in benefits.
In conclusion, we should not focus on what has already been done. We should
focus on the cost of the work ahead. We appreciated the Congressional action to
defer the October 2014 date, and recommend using the time to refresh the cost
benefits case using up to date knowledge. If administrative simplification is
to occur, it needs to reduce health care in administrative overhead, not add to
it. Thank you again for the opportunity to participate in today’s panel. I look
forward to any Q&A period that remains. Thank you.
DR. SUAREZ: Thank you so much for the testimony. We do have your more
lengthy detailed testimony on record here. Thank you very much. I think we are
going to go next to Nancy.
MS. SPECTOR: Thank you. I would like to thank you for inviting the AMA to be
here today to participate and provide our input on ICD-10 implementation. I
know that most of you are aware of AMA’s policy to stop or delay the
implementation of ICD-10. I just wanted to let you know that our house of
delegates is actually meeting right now. We are waiting. Any kind of new
direction that we might be getting on ICD-10. There were some resolutions
around ICD-10, so we are waiting on that.
While we appreciate that physicians and the industry have been given a year
to complete the ICD-10, we continued to have concerns with ICD-10. These are
concerns that are not going to be necessarily resolved with this extra time.
This is what I am going to focus on.
Our testimony is going to focus on the important areas, the opportunities
that we can focus on when during this delayed period.
Looking at implementation costs, and I appreciate what John provided in
terms of some cost information. We consider ICD-10 to be a massive unfunded
mandate for physicians. It comes at a time when physicians are trying to meet
several other federal requirements and risk penalties if they fail to do so.
We have got meaningful use, PQRS, E-prescribing, value-based modifier, all
of these have penalties in the forms of cut to Medicare reimbursement if these
requirements are not being met. There has been no financial compensation for
physicians to implement ICD-10.
Look at this, we talk about all of these penalties. This shows you what
these penalties look like, how they are adding up. That maximum penalty of a 9
percent cut continues through 2023. These new numbers don’t include the 2
percent sequester that they are already being hit with.
Our first recommendation is that the federal government explore some sort of
financial compensation for physician practices to implement ICD-10 by the
compliance deadline. We would look at compensation. That could be obviously
partial coverage. Then, also how we could do that. We need to look at that. Our
thoughts are looking at tax credits or potentially decreased penalties from
these other programs.
Transition risks, this is something that we have continued to talk about. We
are very concerned about claims not processing correctly or not processing at
all during the transition. Even if it is a practices one player or just some of
their claims, this still could account for hundreds of thousands of dollars.
This money can add up very quickly.
As a few others have mentioned, we are very experienced with the transition
to 5010, the transition to NPI. There were problems in both of those. We expect
that there will be issues with ICD-10. We really seriously need to be looking
at industry-wide risk mitigation plans. We need to be looking at that now, so
that we can have those in place and ready to kick in if problems start to
arise. We can’t start thinking about what to do once we are in the transition
and those problems start to present themselves.
The Medicare Advance Payment Policy, I talked about this when I testified in
February, so I am not going to go back into a lot of that detail. This is not a
cash advance. This would be a payment that would be made to physicians after
they have provided services, but their claims are not able to process. This is
something that we are going to continue to have conversations with CMS about
making a more flexible Medicare Advance payment policy and making that a little
bit more widely known to the contractors as to how practices could go about
accessing, if need be.
When we have talked about financial risks and claims not processing with
CMS, they have talked to us about their free software that is available. We do
have some concerns about this. This would only be if the practice’s vendor is
not ready. It doesn’t address if Medicare, the contractors are having a problem
processing claims. It is also something we have some technical questions about.
I was searching Medicare contractor websites. There was one website where I
couldn’t find anything about the software. Then, most of them I was finding
information. Some of them had pretty good implementation documents for how to
go about setting it up. Me not being tech savvy, maybe some of this just was
something that I would’ve struggled with, but maybe not others.
Some of the things, like it said that it could only be done via a modem. I
wasn’t sure how much modems are really in use these days. It said specifically
not DSL and some of the other internet that I am more aware of today. We just
have some technical concerns. That is something that can continue to talk to
CMS. Again, we feel like there needs to be some more industry-wide recognition
of risk mitigation plans.
Industry preparedness testing, many people have already talked about that.
We were very pleased that Medicare was going to do the end-to-end testing. We
were very disappointed then when it got canceled. We are hearing some large
payers saying they are not going to do testing until January.
We feel like this extra 12 months is something we really need to take
advantage of. We need to have the industry doing testing as soon as possible.
We heard the results of the March Medicare acknowledgement testing, and that
was good to hear. When you look at the number, that 90 percent of the claims
process, is sounds really good until you realize that they process 4.4 million
claims a day. That is the number that we have seen on average.
You are looking at about 440,000 claims that wouldn’t have processed. That
is just per day, so that number can quickly add up, especially if it is one
practice that is losing out on all of its Medicare claims going in the door.
This is something that we still need to focus on. We can’t have widespread
processing problems when we make the transition.
We understand, and I know Sid was speaking about this, but payers can’t test
with every provider and every physician. We understand that. I think the payer
side needs to understand the skepticism that is out there by physicians about
if I don’t test, how do I know? Even if there are these general reports that,
oh, everything is going well, I haven’t tested. I think many of us personally
would feel that way. Something is happening and changing. I want the comfort of
knowing that I have tested and it is going through.
Maybe there is a medium ground that we can reach. Maybe it has to do with
publicizing the results of testing more widespread, and also a better effort on
the payer side to test with the full variety of demographics of types of
providers out there, so that when they report, they can say, we tested with
solo physicians in these specialties and things went well. We tested
medium-sized practices of this size, things went well. So that they can say,
oh, someone like me tested and it went well. That is something to consider.
In terms of recommendations, we ask that Medicare and all payers reinstate,
and then testing as soon as possible. Again, work with widely publicizing the
results of that testing. In terms of impacts on other programs, this is
something that we are very concerned about. The PQRS, Meaningful Use
Value-Based modifier programs, they all balance very precariously on the
specific data and the reporting of that data. Anything that compromises that
data is going to risk putting that physician into the penalties part of that
This is not necessarily things that we fully understand at this point. We
think that this is something, though, that needs to be looked at. We are
willing to participate in that. One of the biggest questions we have, the
reporting with ICD-10 is going to change quality reporting more than halfway
through the year. Nine months of the year is going to be under ICD-9. Three
months of the year is going to be under ICD-10.
Is CMS going to be able to pair up that data for those patients, and pair up
and make sure that those quality measures are met for that year. If not, there
is a big risk for penalties. Any problems with calculations will put physicians
into a 2 percent penalty cut for that 2015 data year.
We want to make sure that the quality measures are tested well and know that
they are functioning properly. We would also like to look into some flexibility
with assessing penalties as we go into the ICD-10 transition, if there are
widespread issues with reporting data.
While we are on the topic, we have heard some of this throughout today. This
is also an opportunity to look at some of the other administrative
simplifications opportunities that have the ability to bring us savings
throughout the industry. We wanted to touch on that, as well.
We have talked about attachments today. That is something in the 2005 NPRM.
It estimated somewhere between $414 million to $1.1 billion over five years
would be the net savings for the industry. Acknowledgements, we don’t have a
dollar amount for that, but we know the manual work that happens when we don’t
have good acknowledgement processes in place.
Adopting the guidelines to allow for coding uniformity, that decreases
variability. That decreases the manual work that goes into claims processing. A
standard set of claim edits, Colorado has been doing a lot of work in this
area. I think they testified. I think you had hearings on that a couple of
years ago. They have estimated that they could save in the state $40 million
just by adopting a standard set of code edits. If you multiple that by 50
states, you are looking $20 billion in savings right there.
We really think that this is the time for the industry as a whole to look at
some of these other administrative simplification efforts, where we can cut
costs out of the system. Just another visual here, this was some estimates of
administrative complexity and the cost that it puts on the industry. You can
see just at a midpoint, for Medicare, it is costing $36 billion. Industry wide,
it is estimated to be $248 billion. We definitely have room in here to work on
bringing some cost savings to the industry.
Just in conclusion, these are the points that I was making throughout. The
year delay gives us a chance to look more closely at these particular areas.
Some area for financial compensation for physicians to offset their ICD-10
costs. Industry-wide contingency plans for the transition period. We need to
reinstate the end-to-end testing and publicize those results widely. Test the
quality measures and then a chance to work on administrative simplification
efforts. I thank you for inviting us to testify.
DR. SUAREZ: We are going to next to John Evangelist, who is on the dial-up.
MR. EVANGELIST: Changes to Medicare fee for service claims processing
systems were complete a year in advance to ensure successful implementation of
ICD-10 for October 1st, 2014. On April 1, 2014, the Protecting
Access to Medicare Act of 2014, PAMA, was enacted, which said that the
secretary may not adopt ICD-10 prior to October 1st, 2015.
Accordingly, the US Department of Health and Human Services expected release
of interim and final role in the near future that will include a new compliance
date that would require the use of ICD-10 beginning October 1st,
2015. The rule also required HIPAA-covered entities to continue to use ICD-9
through September 30th, 2015.
The Centers for Medicare and Medicaid Services intends to use the year
postponement to continue its system testing, including an end-to-end test with
submitters. Prior to PAMA, CMS had reported to this committee a recap of the
Medicare fee for service testing that was completed to date, and additional
steps it was taking to test with the provider community.
As CMS reported, the implementation of ICD-10 represents the significant
co-set change that impacts the entire health care community. As the
implementation date of October 1st, 2014 was approaching, CMS
discussed a four-pronged approach to preparedness and testing to ensure that
CMS, as well as the Medicare fee for service provider community, was ready come
October 1st, 2014.
The four-pronged approach including CMS internal testing of its claims
processing system, beta testing tools for the provider community, upcoming
acknowledgement testing, and end-to-end testing. Today, I would like to give
you an update on the acknowledgement testing completed in March, and future
This past March, CMS conducted a successful ICD-10 testing week. Testers
submitted over 127,000 claims with ICD-10 codes to the Medicare fee for service
claims systems, and received electronic acknowledgements confirming that their
claims were accepted. Approximately 2600 participating providers, suppliers,
billing companies and clearinghouses participated in the testing week,
representing about 5 percent of all submitters.
Clearinghouses which submit claims on behalf of providers were the largest
group of testers, submitting 50 percent of all test claims. Other testers
included large and small physician practices, small and large hospitals, labs,
ambulatory, surgical centers, home health providers and ambulance providers.
Nationally, CMS accepted 89 percent of the test claims, with some regions
reporting acceptance rates as high as 99 percent. The normal fee for service
Medicare claims acceptance rates averaged 95 to 98 percent.
Testing did not identify any issues with the Medicare fee for service claims
systems. The testing week allowed an opportunity for testers and CMS alike to
learn valuable lessons about ICD-10 claims processing. The test claims that
were rejected were the result of errors on the claims themselves.
In order to process correctly, all claims had to have a valid diagnosis code
that matched the data service and a valid national provider identifier.
Additionally, the claims using ICD-10 had to have an ICD-10 companion qualifier
code, and the claims using ICD-9 had to use the ICD-9 qualifier code.
Claims that did not meet these requirements were rejected. In many cases,
the testers intentionally included such errors in order to make sure that the
claim would be rejected, a process often referred to as negative testing.
HHS expects to release an interim final rule in the near future that will
include a new compliance date that would require the use of ICD-10, beginning
October 1st, 2015. The rule will also require HIPAA-covered entities
to continue to use ICD-9 through September 30th, 2015. Providers,
suppliers, billing companies and clearinghouses are welcome to submit
acknowledgement test claims anytime, up to the anticipated October
1st, 2015 implementation date.
Submitters should contact their local Medicare administrative contractor for
more information about acknowledgement testing. CMS will be conducting
end-to-end testing in 2015. Details about this testing will be released later
Prior to the passage of PAMA, Medicare fee for service had planned to
conduct provider-initiated end-to-end testing to help the provider community
prepare for ICD-10. This testing was postponed in order to give CMS time to
update its software to reflect the new ICD-10 implementation date.
CMS will announce more details about end-to-end testing, including the
specific testing dates, as soon as possible. As CMS reported previously, the
purpose of this testing was to help the provider community prepare for ICD-10.
Subsequently, CMS recommends that providers and other submitters leverage their
variety of available ICD-10 tools and resources available for download from the
CMS website, including national coverage of terminations converted from ICD-9
to ICD-10, Medicare severity diagnosis related groups converted from the
current ICD-9 to an ICD-10.
Versions of the current ICD-10 MSDRG group, or Medicare code editor, and
MSDRG definitions manual are available. A pilot version of the October 2014
integrated outpatient code editor utilizing ICD-10. CMS encourages providers
and submitters to utilize these tools as they test the ICD-10 readiness of
their own systems.
CMS recognizes that budget neutrality under ICD-10 is a common concern among
providers. Note that Medicare fee for service payment rates are based on CMS
payment policy decisions, which are determined through annual formal
rule-making. In general, the implementation of ICD-10 is not intended to result
in any payment policy changes. If policy changes are necessitated as a result
of the implementation of ICD-10, such changes would be addressed separately
through the rule-making process.
Payment policies that currently employ ICD-9 diagnosis codes will be
modified to use ICD-10. Those same payment policies will remain in place. For
instance, CMS has converted the current ICD-9 version of the MSDRG to an ICD-10
version, so that a patient’s admission will be assigned to the same MSDRG,
whether the mission is captured in ICD-9 or ICD-10 codes.
Providers who will not be able to complete the necessary system changes to
submit claims with ICD-10 codes by October 1st, 2015 should
investigate downloading the free billing software that CMS offers. The software
has been updated to support ICD-10 codes and requires an internet connection.
Alternatively, many Macs offer provider internet portals and a subset of
those portals offer the ability for providers to submit professional claims.
Professional providers that bill to a Mac whose portal offers this
functionality should register for the portals, to ensure that they have the
flexibility to submit claims this way as a contingency. That is it for my
DR. SUAREZ: Thank you very much.
MS. KOVACH: I am, but that testimony covered myself and John both.
DR. SUAREZ: Okay, so we have that. Thank you very much. We are going to go
MR. ODIA: This is Godwin Odia. For those of you I have not met previously, I
am the CMS leader responsible for supporting the state Medicaid agencies,
including the territories of the United States with ICD-10 implementation
I spoke about this situation with the February NCVHS meeting. I am
participating online due to a previously scheduled ICD-10 technical assistance
and training session with the state of New York Medicaid Agency. As much as I
would like to be speaking with in person today, I am sure that you can
appreciate the importance of my being in New York, as it is one of the top five
Medicaid beneficiary states.
We are not stopping our technical assistance and training for the states due
to the delay in ICD-10 compliance. Each state is using the time to provide
targeted technical assistance for the state with special emphasis on US
territories and those states that were behind in their implementation schedule.
The topic areas I will be addressing today include state Medicaid agencies,
challenges, issues and risks related to ICD-10 delay. Opportunities and focus
areas, monitoring and oversight of states, followed by questions and answers
related to CMS Medicaid.
Soon after the delay was passed, the states and territories provided
commentary as to the potential impact of the ICD-10 implementation to their
system, businesses and operational policies and resources, including financial
impact. A month later, an advisory board, which is comprised of representatives
from the states that consistently perform at an advanced state of readiness
also provided feedback of the impact of the postponement or delay. The feedback
provided representatives a full spectrum of state Medicaid agencies, ICD-10
CMS wants to emphasize that the comments presented here have not been
independently vetted or verified by or for CMS. This is just raw data that we
received from the states. As for the most common themes we are seeing, states
further along with their ICD-10 implementation were impacted most, as they will
have to revert back to the retired processes forms and manners that supported
the ICD-9 involvement. Conversely, states that were lagging have been afforded
additional time to move towards being fully compliant by the new date.
States indicated the need to conduct a total impact assessment once CMS
provides finer guidance regarding this delay. Hopefully, the delay has a
cascading effect on progress with ICD-10, interdependencies and its impact both
internal and external stakeholders of the states. Most importantly, in states
over (?) indicator, they will continue with the ICD-10 implementation effort.
That is one of the good news.
I will speak to each of these areas in more detail. The states will need to
make distinct changes to reflect the newer implementation dates and to address
the impact to offer assistance. We are to conduct testing to ensure accuracy in
Additionally, states report the need to support both a testing and
production involvement for an extended period. The states have modified their
testing to allow for additional external testing with the new implementation
date. A number of states have scheduled system upgrade around the October 2014
date, so they will need to adjust plans on the new compliance date. CMS not met
may have an extension of the code freeze, those believe the state Medicaid that
this will have to make additional changes to their system and policies to
accommodate new codes.
The degree in which the states need to make adjustments to their policies
and CMS processes is proportionally to the amounts of progress they have made
in their ICD-10 implementation, prior to the delay. For most, it will be a
matter of reverting back to the policies and business processes that supported
the ICD-9 environment. Again, the extended codes will help minimize the work
effort for the states.
The most consistent feedback regarding the impact of the delays for the
state is related to resources. States that have contract personnel supporting
the ICD-10 implementation will need to extend their contracts. Some
functionality that was previously bonded into ICD-10 implementation on the
original compliance date will have to be undone and retested for additional
The MMI, which is the state system, and other ICD-10 projects personnel may
be reassigned to other projects during the delay period, and then reengaged
closer to the implementation date. To ensure people retain ICD-10 knowledge
from prior training, the states have indicated plans to conduct ICD-10 review
session for personnel.
States’ estimates of costs implication is vary significantly. One, the
details of CMS go forward strategy realize they will need to reframe their cost
analysis to support any funding requests.
The goodness is that many of the states have indicated they are going to
utilize this next year as an opportunity to optimize their ICD-10
implementation effort. CMS is continuing to provide the technical assistance
required to ensure states comply with ICD-10 implementation dates. We have
worked with states that have been behind the timeline, and are now moving
forward and making excellent progress.
The states that were more advanced in their project plan to use the extra
time for additional testing with stakeholders. CMS has also completed nine
comprehensive ICD-10 workshops encompassing all 10 HHS/CMS regions. This year,
CMS is actively engaged with the five territories of the United States, and we
are already providing remote technical assistance with them on a biweekly
basis, to be followed by onsite visits at mutually agreed to dates.
With the extended ICD-10 implementation timeline, CMS is also encouraging
states to align their ICD-10 migration or transition with their state’s Workers
Compensation and property and casualty program. We have asked the states to
report back to us their alignment. We have received about 43 states responses,
18 of whom indicated they were aligning. The rest said no. We have yet to hear
back from about 13 states, including four territories. I have spoken with about
four of the territories, and they indicated they will be aligning their Workers
Compensation Programs with the ICD-10. I think we have about seven or eight
states that we have not heard from. My guess is about 30 states and
territories, at the end of the day, will be aligning their Workers Compensation
Program to ICD-10.
The states have indicated that additional time would support and enhance
provider outreach and engagement, a possible consequence of the postponement
since provider residence was a concern for essentially all of the state’s
This map shows the expanses, comprehensive effort that CMS team of ICD-10 on
Medicaid subject matter experts is providing the states and territories, and
give testimony to CMS ongoing commitment to ensure the performance is leveraged
to optimize state Medicaid ICD-10 implementation.
Monitoring and regular contact with the state Medicaid agencies, and we are
here in New York this week. A number of vendors are used to this state Medicaid
agencies program. Since 2011, the state Medicaid agencies have completed the
web-based readiness assessment on the quarterly basis to evaluate the start-up
of the ICD-10 implementation program.
We ask the states to spend reports back to CMS, and then the team will
follow up with an in-depth teleconference with the states if there is a
question after their projects status and to determine if and what type of
additional technical assistance may be beneficial to them.
In addition to the readiness assessment and teleconference, states are
afforded multiple channels for direct communication with CMS, including highly
interactive communities of practice, biweekly forums, a dedicated state ICD-10
collaboration web portal, and monitored ICD-10 mailbox.
My team and I have worked hard to establish trust and openness with the
states. I am confident that although we are reliant on the state to accurately
report the ICD-10 project status of CMS, CMS’ work position to leverage the
information from the states by providing ongoing technical assistance necessary
to facilitate ICD-10 readiness by the compliance date.
With that, I end my testimony. I will receive questions. I have to rush
through it because I am the last guy, right?
DR. SUAREZ: Thank you very much. We really appreciate you sticking with us
and taking time to present your testimony. Okay, we are going to have a few
minutes here for some questions, if any of the committee members have any
questions. We will start with Nina.
MS. KLOSS: I have one general question. When we were talking about ICD-10
readiness in the fall and again in February, there seemed to be a real coming
together of the industry and a real strong collaboration across organizations
to get us to the final push.
I think we heard from Sid today that he was really calling for broad
collaboration. I am wondering has that kind of settled back? I mean, is that
one of the consequences of this delay that everybody has kind of had to go back
to their corners and regroup? Is there kind of a goal of getting back together
and being and speaking of one voice a little more deliberately across the
DR. GREENE: If I can add to that, absolutely. We had a lot of collaboration
prior to the delay. I think what you find now is that groups are going back and
looking at their own internal impacts and ensuring that, on October
1st of this year, that providers continue to receive payment under
ICD-9 coded claims. That systems work has to happen pretty quickly. I think
that is why you kind of hear the silence.
Beyond that, yes, we plan to, and actually have started already, bringing
groups together to have that united approach to address any challenges. I think
you will see even more of that with the push for more intense training and
collaboration for the groups that are in support of ICD-10 and those that are
having challenges. I think you will see more collaboration across the board.
DR. SUAREZ: Sue, I think you were the most explicit of any of the presenters
in this section about educating Congress. What is the plan?
MS. BOWMAN: Certainly at AHIMA, we have a pretty extensive plan, both at our
national office to continue to meet with key committees and members of Congress
to educate them, not only on why we need to make this transition, what the
importance of moving to this code set is, but really what the impact of this
delay has been on the industry and really what the terrible ramifications of
any further delay would be.
As part of that, we also have a plan. We are rolling out our grassroots
members to do the same thing in their constituencies, as well, to move forward.
We can have a pretty strong letter-writing and meeting campaign that will
hopefully prevent this going forward.
DR. GREEN: Who is the we?
MS. BOWMAN: At AHIMA and within our membership.
DR. GREEN: Ignore this if this doesn’t make sense, but you guys all came
across how important it is to collaborate testing across all the players to get
this done. No one is talking about collaborating and educating Congress.
MS. BOWMAN: We actually are part of a coalition group, the Coalition for
ICD-10 that is the collaboration of various organizations that are committed to
moving forward with ICD-10 next year. That group does together meet with
Congress and have plans as part of the group.
DR. GREEN: Is AMA in that group?
MS. SPECTOR: They are kind of in a different, but they are welcome to join.
DR. SUAREZ: The other point I wanted to make is really in addition to
addressing Congress and educating Congress. I think the reality is we have a
large number of organizations almost ready or getting ready or pretty much
ready. Many of them are large health care provider systems. The real challenge
is how to identify and get those that are not ready, or that are behind being
ready, to move forward with getting ready. That is really, in many respects,
what has created this push to delay.
While a large segment of the industry was ready and was going to be capable
of handling ICD-10 by October of this year, clearly Congress heard that there
was going to be a large number of organizations, mostly primarily provider
systems, that were not going to be ready.
My question really back to maybe Nancy is, are we going to be working
towards getting those health care provider organizations ready for ICD-10 by
2015? That is ultimately the goal.
MS. SPECTOR: Just to preface this, as I said, from the AMA, we have policy
that is developed through our house of delegates. Our policy that has been
developed is calling for us to stop or delay the implementation of ICD-10. We
have that on one hand.
For at least a year, we have also been on the other hand saying, even though
that is our policy, this is a regulatory requirement. We have to educate
physicians and provide that education outreach, so that they know that they
have to meet this regulatory requirement or risk not being able to have their
It is interesting because Friday, I was in Chicago before the House of
Delegates meeting started. We have physician groups that come together and
meet. I was there doing a presentation on ICD-10. We were specifically asked,
Stanley and I, were questioned about how can we have policy that says this, but
then you are still out there educating?
That is a challenge that we face from our organization and the way that we
have our policy developed. From internally, we do remain committed that this is
a regulation and that we would be not meeting our obligations to our members
and to the physicians to not keep them up to date on what is going on and keep
them educated, and do as much outreach as we can.
In this delay, when this happened, we heard from a lot of groups that were
also sharing information about physician groups that were on target, getting
ready, were very frustrated that this delay happened. I think that when you
look at how many physicians are out there, you have such a wide variety in
terms of those who are early adopters, who are doing things. Then, those who do
lag in terms of an implementation such as this. I think that is a challenge
that we face on our side. It is definitely something that we are working to try
and get everybody across the finish line together.
DR. SUAREZ: Thank you. We will certainly look forward to working with AMA
and the rest of the industry in trying to get us to achieving compliance or
achieving the transition and meeting that.
DR. GREENE: I was just wondering if there were certain items on your list of
recommendations that were high priorities that would change that stance, either
some of the things that you recommended or a modified version of that. I am
just curious if any of those things would actually change the current position.
MS. SPECTOR: That is something I could take back, and we could talk about.
It is hard to know exactly. These are generally the issues that we have been
hearing, and the recommendations would be addressing those concerns and
barriers. It is hard to know sort of what might be one over the other for
DR. SUAREZ: Okay. Are there any more questions? If not, we want to invite
any public person to make any statements, if there are any statements.
PARTICIPANT: I am Stanley, a consultant to a number of the groups that
actually testified here today. A number of times, we heard that a number of
practice management systems were not ready. That seems to be a continuing
problem in the industry.
I can tell you that within the practice management system industry, they
have begun the formation of what they are calling the Health Care
Administrative Technology Association, an actual association of practice
management systems. This is a group that has been scattered and has not really
been at the table, except for perhaps individuals, but there has not been a
good way of communicating with that group as a whole and (off mic) problems of
Tim McMullen is the executive director. The purpose of the group is really
to provide resources for members to access education and health care industry
information. Also, to represent the highest standards and values within the
administrative technology issues. There is a recognition by a number of members
that they have got to do a better job. If some of those things have to do with
agreeing to be ready a certain number of months before a compliance date, that
is something that they would certainly like to look at and discuss with you.
I think it was also mentioned in addition that WEDI and EHNAC are developing
a practice measurement system accreditation program that will also at least
give providers some sense that there is somebody out there looking at these
systems and recognizing and accrediting that they are meeting particular needs.
The practice measurement system industry is, I believe, hearing some of the
concerns and trying to work together to address them. I have some cards for Tim
if anybody wants them.
DR. SUAREZ: Thank you so much. I know Tim wanted to do that. It is very
important and very encouraging that we have now this resource to connect with
all the practice management vendors. We have a similar situation with the EHR
vendors, going through a similar process in the EHR and meaningful use program
certification of EHRs and all that.
I think it is a very good example of how, at least for providers, there is a
way to understand and know whether a vendor is capable of doing what they say
they are capable of. I think it is very valuable to have that connection. I am
sure we will be connecting with Tim in that.
PARTICIPANT: I will point out on the EHR side, those are government
mandates. On the practice management system side, they are trying to this
voluntarily. Hopefully, it will work.
MS. WEIKER: This is something that probably should have been in the DSMO
report now that I think about it. Nancy reminded me on her list of other things
to consider and that is acknowledgements. The Dismo long ago testified. This
panel actually held testimony on acknowledgements and wrote a letter. To date,
nothing has been done.
I suggest maybe the committee follow up and see what is the status. Is it
ever going to be done? Should we just forget about it? Should it just be
industry-adoption? I know they are part of the operating rules at CAQH core has
built. There has been some, no, they are not, yes, they are, no, they are not,
yes, they are, kind of thing going on. Then, some interpretation of a back door
way to get them adopted. I am just calling it like it is, Stanley.
Perhaps this committee ought to ask as a follow-up of where is this going,
or is it going nowhere?
DR. SUAREZ: Thank you.
MS. SPECTOR: I brought up about the standard code edits. I had to cut some
things because I knew I was going to run out of time. ACA listed several things
that the secretary had the ability to consider and bring forward. I know that
NCVHS did hearings on that. I think it was 2012, and did a letter to the
secretary on that. If you are going to go back and say, what is going on with
this? Maybe we could tack that on, as well, and ask for a follow-up on those
topics, as well.
DR. SUAREZ: Thank you.
MS. BLOOMROSEN: At the risk of keeping us here any later than we are here
already, I am Meryl Bloomrosen. I am vice president of public policy and
government relations at AHIMA, a colleague of Sue. I would like to just
emphasize sort of a remark she made that was passed over lightly. That is that
we are a part of an ICD-10 coalition. We will be wanting to, and do want to,
invite other organizations that are not currently participating with us in this
effort, which is to primarily continue the messaging that there should be no
further delay for ICD-10.
In addition, notwithstanding Nancy’s discussion about policy and perhaps
reality, as well, we would be pleased in our paper that Sue mentioned that is
currently on our website and in our perspective journal, we have made a number
of recommendations on how can and are willing to lead and convene the industry
to move the ball down the court. That would involve, if can’t be policy, Nancy,
then in the reality of working with small providers, rural providers, critical
access hospitals, urban facilities, we are ready, willing and able to help move
the ball as far down the court as we can get.
We look forward to working with medical specialty societies, in addition to
the AMA. We have reached out with CMS, as well, to the practice management
association. I would like to reemphasize the ability for the industry. I think
Linda’s question was right on that given the delay, notwithstanding that
perhaps as Nisi has said, it is because people are worried now about retooling
to get ready to make sure ICD-9 can continue past the prior due date, that
efforts are going to need to move quickly to make sure that we can implement on
October 1, 2015. We would be excited to help lead and convene that activity.
DR. SUAREZ: Thank you so much.
PARTICIPANT: We are going to spend $16 million over the next five years
going forward. That continues on forever. You multiple that times the number of
providers and whatever portion of their budget and payers. This is a lot of
money that is going to be spent on this solution to accomplish the accuracy of
payments, improving the miscoded rejected, the original benefits that were
You add that money up, and we are talking several billion dollars. Is ICD-10
CM and ICD-10 PCS the best way to accomplish those and spend that money? That
is a question that I ask the subcommittee to consider going forward.
DR. SUAREZ: Thank you for that. I know you noted that in your testimony and
even considered perhaps some staggering of the transitioning. You are going
back to the sort of question again of what is the benefit in adopting ICD-10
for coding purposes, for billing. I think there is a significant amount of
considerations given in the past to that question and a lot of documentation.
I think your point is basically is that still a valid case or not. That is
something that we will certainly need to consider, as we really look at what
will need to happen. We are more focused as a subcommittee and committee
probably on what is going to happen in this next year.
We are awaiting certainly the regulation, the interim final rule from the
Department of Health regarding the delay and implementing basically the PAMA
prohibition about the delay. Once that is decided, then we will need to define
what are the recommendations regarding what to do in between as we approach the
delay. Certainly, that is an important point to consider, as well.
DR. GREENE: I was just going to mention that I do think it is an opportunity
to look at some of the benefits and get that out to the industry. I think along
the way, we were probably moving so quickly down the path of compliance and
getting ready that now it is a good time to start talking to providers, payers,
vendors and other clearinghouses about the benefits. There are some that have
been documented and described. I think that we can definitely look for those
good cases to, I guess, describe those benefits and how they relate to a
provider versus a payer versus any other stakeholder across the health care
DR. SUAREZ: Thank you. Any other comments from the phone, since we don’t see
you? Okay. I just want to express our deepest appreciation to everyone that was
a member of our testifier group today. It has been a terrific hearing. We look
forward to continue to work with you regarding the observations, themes and
recommendations that will come out of this. Thank you so much again for
sticking with us. We will consider this meeting adjourned. Thank you.
(Whereupon, at 6:22 p.m., the meeting was adjourned.)