1. Is Your Practice Ready for HIPAA Transactions, Code Sets and Testing? Mark Charles Consultant, Altarum David McLaury Director of Project Development and Implementation McLauryD@michigan.gov

2. 2 Are You Ready for HIPAA Transactions? Realize current proprietary formats are going away Switch to the HIPAA compliant electronic transaction formats (e.g., 837 v.4010 format) and national code sets Begin integrity testing Test your internal systems first with a qualified third party before B2B transaction testing with MDCH Start B2B transaction testing Get your 837 v. 4010 claims in for testing with MDCH now Begin testing your other HIPAA Transactions in April 16, 2003 Be HIPAA compliant by October 16, 2003

3. 3 HIPAA Mandated Standards Administrative Simplification Electronic Data TransmissionData Protection Transactions Code Sets IdentifiersSecurityPrivacy

4. 4 What are the Benefits of HIPAA? HIPAA was designed to provide many benefits to both medical offices and patients. Some immediate benefits include: Reduces administrative burden and cost for providers and payers Creates a national standard for electronic transactions Increases speed of financial transactions resulting in faster payment for services Simplifies the exchange of information and reduces paperwork Provides a more complete picture of healthcare and improves quality Improves privacy and security of healthcare information

5. 5 HIPAA’s Impact on Health Care Providers Post HIPAA, health care providers are more likely to: Replace paper (encounter and billing sheets, medical records) with computerized processes Be paid electronically and more rapidly Use the Internet for healthcare business and information Use only national codes Use common identifiers (except for patients), and expect these identifiers to be accepted Be more security-conscious and expect this of others

6. 6 Electronic Transaction Benefits Electronic transactions provide significant benefits compared with paper transactions: EDI streamlines transaction processing. Formats are pre-edited to reduce common errors in claims data entry. This reduces the re-entry of the same data. It also reduces delays caused by scanning and re-keying. EDI also reduces operating costs and increases staff productivity. Improves cash forecasting & cash flow. Faster submission of accurate claims results in quicker payments and reduced receivables. Provides positive acknowledgement of transaction receipt Eliminates the cost of handling and storing paper documents

7. 7 The Electronic Transactions 837Institutional Claims and Encounters 837Professional Claims and Encounters 837Dental Claims and Encounters 835Claim Payment and Remittance Advice 834Enrollment and Disenrollment 820Capitation Payment Transaction 276Claim Status Request 277Claim Status Response 270Eligibility Request 271Eligibility Response 278Referral Authorization (Request) 278Referral Authorization (Response)

8. 8 Preparing for HIPAA: Michigan’s Uniform Billing Project Michigan’s Governor mandated Uniform Billing for the state’s Medicaid Program. The new system simplified the old billing process; adopted standard healthcare industry claim formats and code sets; and was the first step toward HIPAA compliance. The project was initiated in early 2000. Replacing all proprietary claim formats with industry standard formats Working with affected associations and provider groups to communicate the changes Preparing and training thousands of billers and reimbursement specialists for conversion Testing claims

9. 9 Michigan Medicaid Information System (MMIS) The Michigan Department of Community Health (MDCH) is the single state agency for Medicaid MDCH operates its own management information system and makes continual updates to its MMIS Converting the MMIS to HIPAA compliance has been a large multi-year project MDCH works with outside consultants to ensure MMIS is HIPAA compliant MDCH works with outside consultants to educate providers through outreach efforts

10. 10 Provider Education and Outreach MDCH is working with your association to ensure successful HIPAA conversion through: Education and outreach meetings and seminars with Providers like you MDCH web site www.michigan.gov/mdch HIPAA Primer at www.healthcare.mivu.org www.mihealth.org your link to Michigan Health Resources and complete details about HIPAA Transactions including updated questions & answers HIPAA Transactions Brochures HIPAA Transactions Newsletters Frequently Asked Questions – updated constantly on the MDCH (www.michigan.gov/mdch) and mihealth.org web sites

11. 11 MDCH HIPAA Transaction Compliance Plan Stay in compliance with the HIPAA law and in sync with BCBSM and other large payers’ (Medicare A and Medicare B) implementation plans Strongly encourage providers to send electronic transactions to take advantage of HIPAA’s benefits Implement electronic transactions incrementally October 1, 2003:Began Accepting 837 v. 4010 Dental, Professional and Institutional Claims January 1, 2003:Began Accepting 837 v. 4010 Encounters from Medicaid Health Plans Began Accepting 837 v. 4010 Nursing Facility Claims April 16, 2003:Begin Testing Other HIPAA Transactions October 16, 2003:Only HIPAA compliant Claims and Transactions accepted

12. 12 Switch to the HIPAA Compliant Professional Services Claim Format Covered EntitiesCurrent Claim FormatHIPAA Compliant Format All Professional Services837 v.3051 will be accepted 837 Professional v.4010 Providers (listed below)until 10-16-03is currently accepted Physicians Advanced Practice Nurses Podiatrists Chiropractors Independent Clinical Labs Independent Private Duty Nurses Medical Clinics Family Planning Clinics Children’s Waiver Service Providers Ambulance School-based Services Maternal/Infant Support Services Providers Hearing & Speech Centers Optometrists Medical Supply/DME Providers Orthotists/Prosthetists Optical Companies Oral Surgeons FQHCs/RHCs/IHCs Physical Therapists CMHSPs and Substance Abuse CAs

13. 13 The Mandated Code Sets CPT and HCPCS Level II--all services billed on professional format CDT-Dental Services NDC-Drugs ICD-9-CM Vol. 3, Codes Inpatient Hospital procedures ICD-9-CM Vol. 1 & 2 Diagnosis codes for all providers National codes will be updated on an annual basis

14. 14 What Providers Must Know about Code Sets MDCH has replaced most local codes. Providers will have notice of any outstanding local procedure code conversion to national codes by August 1, 2003. If a code requires a policy change public comment will begin April 1. All Medicaid code sets must be utilized by date of service. If the date of service is prior to October 16--and a local code was in effect-- that local code must be used regardless of when the claim is submitted. Service rendered on or after October 16 will require standard HIPAA compliant codes. Submit your test claims with current codes until MDCH notifies you of changes Pay attention to your national code set group and MDCH for additional guidance.

15. 15 Re: Code Sets — Paper and Electronic Billers Need: To PURCHASE your correct national code set manual MDCH Medicaid Billing manual with Chapter IV for your provider type MDCH numbered letters and bulletins for your provider type

16. 16 Testing Electronic Transactions Stage 1: System Integrity Testing MDCH recommends providers successfully complete third party testing from an independent service (like Foresight’s HIPAA Validator) prior to transaction (B2B) testing to confirm HIPAA compliance. Be advised that successful Integrity testing does not mean that your files meet all MDCH rules for Transaction (B2B) testing. Stage 2: Transaction (B2B) Testing Transaction testing determines if trading partners can successfully transmit and receive HIPAA compliant transactions. Providers should submit a small but relevant sample of transactions to payers (i.e., MDCH, BCBSM) to assure business to business file compatibility. Note: Instructions for the Foresight HIPAA Validator and for submitting test claims to MDCH can be found at www.michigan.gov/mdch and www.mihealth.org.

17. 17 Resources Needed Prior to Testing Electronic Transactions National Implementation Guides and Clarification Documents www.wpc-edi.com/hipaa/hipaa_40.aspwww.wpc-edi.com/hipaa/hipaa_40.asp Michigan Medicaid Clarification Documents www.michigan.gov/mdch (click on Providers, Information for Medicaid Providers) www.michigan.gov/mdch MDCH Electronic Submission Manual www.michigan.gov/mdch (click on Providers, Information for Medicaid Providers)www.michigan.gov/mdch Code Set Manuals for your Professional Provider Type CPT: www.ama-assn.org www.ama-assn.org HCPCS: cms.hhs.gov/medicare/hcpcs/default.asp cms.hhs.gov/medicare/hcpcs/default.asp ICD-9: www.cdc.gov/nchs/datawh/ftpserv/ftpicd9/ftpicd9.htm www.cdc.gov/nchs/datawh/ftpserv/ftpicd9/ftpicd9.htm

18. 18 Provider Checklist for 2003 Submit Electronic Transactions and Take Advantage of HIPAA’s Benefits Partner with a HIPAA Compliant Electronic Biller, Practice Management Vendor or Clearinghouse, or Purchase a HIPAA Compliant Software Billing Package Switch to the New Standard Formats and Code Sets Begin Testing Internal Systems First for Integrity and Syntax to Achieve HIPAA Compliance Begin Testing B2B Transactions with Payers to Assure Compatibility with Your System Start Testing 837 v. 4010 Claims Now

19. 19 Provider Checklist for 2003 Begin Testing All Other Transactions April 16, 2003 Pay Special Attention to Your National Code Set Group and MDCH for Guidance Submit Test Claims with Current Codes until Notified Otherwise Purchase Your Correct Code Set Manual Download Your MDCH Provider Type Medicaid Billing Manual Chapter IV Review MDCH’s Numbered Letters and Bulletins for Your Provider Type Check with Other payers for Details about their HIPAA Implementation Plans, Key Dates, and Testing Schedules Be HIPAA Compliant by October 16, 2003

20. 20 For More Information Contact the Michigan Department of Community Health MDCH www.michigan.gov/mdch—official policy and information for HIPAA Transactions MDCH Provider Hotline 1-800-292-2550 MDCH providersupport@michigan.gov www.mihealth.orgwww.mihealth.org — your link to Michigan Health Resources and complete details about HIPAA Transactions including updated questions & answers HIPAA Primer: www.healthcare.mivu.org

21. Slide Presentation Last Updated January 28, 2003