Electronic Data Interchange: Transactions and Security Chapter 8 Electronic Data Interchange: Transactions and Security Today we will review the basic principles and terminology of electronic data interchange and demonstrate the understanding of computers, records management, and electronic claims submission.

OBJECTIVES Advantages of electronic claim submission Transactions and code sets used for insurance claims transmissions Insurance claim data elements required or situational for the 837P standard transaction format Necessary components for a practice management system

ELECTRONIC DATA INTERCHANGE

Electronic Data Interchange (EDI) Sending and receiving health information electronically Used for transmission of insurance claims Transmitted data is encrypted Computer code in place of standard text for security Improves efficiency of claims submission What is EDI? THE PROCESS BY WHICH UNDERSTANDABLE DATA ITEMS ARE SENT BACK AND FORTH VIA COMPUTER LINKAGES BETWEEN TWO OR MORE ENTITIES THAT FUNCTION ALTERNATIVELY AS SENDER AND RECEIVER What is Encryption? TO ASSIGN A CODE TO REPRESENT DATA FOR SECURITY PURPOSES

Covered Entity If you are a provider who bills to Medicare AND you bill electronically to any payer AND you have more than ten full-time employees THEN….. You are a covered entity and must file electronically

Electronic claim TRANSACTION/names ASC X12N 837P – electronic _________________ ASC X12N 837I – electronic _________________ ASC X12N 835 – __________________________ ASC X12N 276 – __________________________ ASC X12N 270 – __________________________

ADVANTAGES OF ELECTRONIC CLAIM SUBMISSION More ______________________ processing Quicker reimbursement from payer Improved ________________ of data Easier and more efficient _________________________ Better _______________ of transactions ________________ of data entry and manual labor Reduction in ___________________ Electronic claims are becoming the way business is done; it is efficient and reduces overhead Errors are reduced partly by computers with prompts to guide processors through a complete and accurate claim, and also by an online error-edit process that flags mistakes immediately so they can be fixed before filing An audit trail is a chronological record of submitted data that can be traced to the source to determine the place of origin

clearinghouses Claims are checked electronically Claims with missing/incorrect information are rejected Rejected claims are sent back to the provider with a report Batches of acceptable claims are sent to the appropriate payer Corrected claims are reprocessed What is a clearinghouse? AN ENTITY THAT RECEIVES THE ELECTRONIC TRANSMISSION OF CLAIMS (EDI) FROM THE PROVIDER’S OFFICE AND TRANSLATES IT INTO A STANDARD FORMAT ACCORDING TO HIPAA REGULATIONS A clearinghouse should separate claims by carrier, perform software edit checks to check for errors, and transmit claims electronically to the correct payer

Advantages of a Clearinghouse Translation into HIPAA 5010 format Claim scrubbing Audit trail Proof of timely filing Improved cash flow Less time processing claims for submission Faster payment

Code sets CPT HCPCS ICD-9 ICD-9-PCS ICD-10 Taxonomy codes Patient account number Relationship to patient Facility code value Patient signature source code The term “situational” means that items depend on whether or not the data content or context is required for the case

The Insurance Specialist Understands how practice management software works How PM pulls from data entry onto the claim How claims are transmitted from PM to clearinghouse Work rejection edits Receipt and download of electronic remits for posting Understands which codes are required Understands claims scrubbing and edits

The Practice management system Prepares, sends, receives, and processes electronic transactions Tracks receipt of Notice of Privacy Practices (NPP), patient treatment consents or authorization An important function of a PMS is accounts receivable A clearinghouse will convert older PMS formats to HIPAA standard transactions A good PMS can effect the medical office by improving office efficiency, reducing errors, optimizing reimbursement for services. Some PMS vendors sell add-ons that link directly to carriers such as Medicare, Medicaid, and BCBS.

Do’s and don’ts for keying insurance data for claim submission DO: use patient account numbers to differentiate between patients with similar names DO: use correct numeric locations of service codes, current valid CPT OR HCPCS codes DO: print an insurance billing worksheet or perform a front-end edit to look for and correct all errors before the claim is transmitted

Do’s and don’ts for keying insurance data for claim submission DO: request electronic-error reports from the third party payer to make corrections to the system DO: obtain and cross-check the electronic status report against all claims transmitted

INTERACTIVE TRANSACTIONS

Interactive transactions Back-and-forth communication between two computer systems Real-time communication allows instant information transfer Electronic funds transfer (EFT) can speed up reimbursement There are several transactions that can be done in real time: eligibility verification, deductible status, claim inquires, status of claims

Electronic remittance advice (ERA) ERA: online transaction about the status of a claim Medicare ERA Formerly called the Medicare explanation of benefits (EOMB or EOB) Based on Health Care Claim Payment/Advice (835) or ANSI 835 The use of ANSI 835 Version 4010 generates an electronic Medicare remittance advice instead of the paper EOB ANSI 835 allows the electronic funds transfer (EFT) of Medicare payments to the physician’s bank account via direct deposit. This improves cash flow in the medical office.

Transmission Reports Send and Receive Files Files received by clearinghouse Batch Claim Report Billed Summary Patient’s name and total charges billed Batch number, billing number Insurance company billed Chronologically the date(s) claim was transmitted Scrubber Report Total number of claims, charges, and dollar amounts received and scrubbed by the clearinghouse Transmission reports are generated for both carrier-direct and clearinghouse claims A status report of claims is sent from the insurance company to indicate electronic processing problems Maintaining a schedule can help with EDI transmission. See Table 8-7 (p308) for a schedule of daily, weekly, and monthly scheduling protocols

Transmission Reports (cont’d) Transaction Transmission Summary Number of claims originally received by the clearinghouse and/or payer How many claims were rejected automatically Rejection Analysis Report Identifies most common reasons claims are rejected indicates what claims were not included for processing Corrections made and claim resubmitted Electronic Inquiry Claim Status Files received from the providers office Indicates the progress of the claim

Workbook chapter 8 Assignment 8-1