Here comes HIPAA Featured

7:13am EDT September 30, 2002
Starting later this month, the first in a string of new standards and regulations affecting the health care industry and those doing business with it takes effect.

Businesses have until Oct. 16 to either begin submitting enrollments, eligibility and claims processing electronically or file for a one-year extension.

The National Standards for Electronic Transaction rule of the Health Insurance Portability and Accountability Act (HIPAA) applies to everything from the largest insurance company and hospital system to the one-person doctor's office. The goal is to simplify and standardize forms sent electronically, says Laura Koballa, senior manager at Deloitte and Touche and a member of its national HIPAA team.

"When the government started writing this, they looked at the ways in which providers, being the health systems and hospitals, and the payers, being the health plans, were communicating in terms of sending standard types of transactions back and forth," Koballa says.

Congress found that there were many different formats for sending transactions, and because of that, it was taking too long to process them.

"So they ... made some very specific requirements on how these transactions need to be," Koballa says.

The deadline for businesses to comply with this section of HIPAA has always been Oct. 16, 2002. But about three years ago, some of the larger health plans started looking at what it was going to take to implement HIPAA regulations.

"When they realized there's no possible way they're going to be ready for this by the October 2002 deadline, the Blue Cross Blue Shield Association was able to convince Washington that they needed (more time)," Koballa says.

To receive an extension, a business must submit a compliance plan to the Department of Health and Human Services which includes the reasons the business is not compliant; a budget and strategy for achieving compliance; and a timeframe for testing, among other things. But there is no approval process.

"The government realized it would be absolutely impossible to have a committee in place to review and validate these extension forms," says Koballa. So the plan "doesn't need to be approved, it just plain and simply needs to be submitted and on file." How to reach: Deloitte and Touche, (216) 589-1402