committee on operating rules for information exchange (core ® ) understanding the value of the aca...

Committee on Operating Rules For Information Exchange

(CORE®)

Understanding the Value of theACA Mandated CAQH CORE Operating Rules

Central Ohio HFMA Spring ConferenceMarch 14, 2013

Additional information/resources available at www.caqh.org

http://www.caqh.org/

2 © 2013 CORE. All rights reserved.

Agenda

• Introduction to CAQH CORE

• Operating Rules and Affordable Care Act (ACA) Section 1104

• Overview of ACA Mandated CAQH CORE Operating Rules

– First Set: Eligibility & Claim Status Operating Rules

– Second Set: EFT & ERA Operating Rules

– Third Set: Attachments, Prior Authorization, Enrollment, etc.

• Reaping the Benefits of Operating Rules

– Engaging Practice Management System (PMS) Vendors

– Measures of Success

– Action Items for Providers

• Q&A


Objectives

• Understand what operating rules are and their role in the broader healthcare context

• Understand status of the ACA mandates and what they mean for providers

• Consider the role of PMS vendors and impact on provide receipt of compliance transactions

• Learn about tracking and potential ROI associated with Operating Rules

• Review a list of immediate action steps for providers to ensure ROI from operating rules


Introduction to CAQH CORE


CAQH: Current Initiatives

Industry-wide stakeholder collaboration to facilitate development and adoption of industry-wide operating rules for administrative transactions. Over 130 participating organizations.

Service that replaces multiple paper processes for collecting provider data with a single, electronic, uniform data-collection system (e.g., credentialing). •85% of Ohio physicians (MD/DO) are registered in UPD

Service that enables providers to enroll in electronic payments with multiple payers and manage their electronic payment information in one location, automatically sharing updates with their selected payer partners.

Objective industry forum for tracking progress and savings associated with adopting electronic solutions for administrative transactions across the industry.


• Mission: To build consensus among healthcare industry stakeholders on a set of operating rules that facilitate administrative interoperability between providers and health plans

– Enable providers to submit transactions from the system of their choice (vendor agnostic) and quickly receive a standardized response

– Facilitate administrative and clinical data integration

• Recognized healthcare operating rule author by NCVHS and HHS

CAQH CORE Background

• A multi-stakeholder collaboration established in 2005


Examples of CORE Participants

The more than 130 CORE Participants represent all key stakeholders including providers, health plans, vendors, clearinghouses, government agencies, Medicaids, standard development organizations, banks, etc.

Health Plans(Strong presence in Ohio markets)

Providers Vendors


Overview of ACA Mandated CAQH CORE Operating Rules


Industry Context: Federally Mandated Operating Rules

• Today, operating rules support existing standards in many high-volume industries, e.g. cellular phones, financial services ...Consider the ATM

• Prior to 2005, national operating rules for medical administrative transactions did not exist in healthcare outside of individual trading partner relationships

• In 2005 CAQH CORE began facilitating voluntary development of industry-wide healthcare operating rules

• In 2010, Section 1104 of the Patient Protection and Affordable Care Act (ACA) required that all HIPAA covered entities be compliant with applicable HIPAA standards and associated operating rules

The effective date for the first set of ACA mandated operating rules was January 2013; additional deadlines follow through 2016.


Industry Context: A Spectrum of Change For Providers

ClaimAdjudication

277 Status Response

834 Enrollment

820 Premium Payment Sponsor

Provider

Charge CaptureClinical O/E, Utilization Review

278 Referral Request

Billing

837 Claim/Encounter

277 Request for Info

275 Claim Attachment

A/Rand Treasury

276 Status Inquiry

Health Plan En

rollm

ent

278 Referral Response Pre-Adjudication

270 Eligibility Inquiry Membership

271 Eligibility Response

835 Remittance (EOB) A/P

Bank

CCD+ (EFT)

• Goal: Generate a responsive, and adaptive, system-wide approach to administrative IT adoption that aligns with other U.S. healthcare strategic initiatives

• Each major transaction in the revenue cycle was addressed by HIPAA in 1996; standards alone did not go far enough to reach Administrative Simplification – therefore, ACA amended HIPAA

• Due to ACA and other pressures, during the next several years the entire revenue cycle process will experience significant transformation as the industry adopts operating rules

– The exchange of data critical to a provider’s revenue cycle, e.g. patient financials

– The infrastructure requirements that drive interoperability and ROI


Purpose of Operating Rules

• The Patient Protection and Affordable Care Act (ACA) defines operating rules as “the necessary business rules and guidelines for the electronic exchange of information that are not defined by a standard or its implementation specifications”

• They address gaps in standards, help refine the infrastructure that supports electronic data exchange and recognize interdependencies among transactions; they do not duplicate standards

Operating Rules:Key

Components

Transmission standards and formats

Response timing standards

Error resolutionException processing

Rights and responsibilities of all

parties

Security Liabilities


ACA Mandated Operating Rules Compliance Dates:Required for all HIPAA Covered Entities

• Eligibility for health plan• Claims status transactions

HIPAA covered entities conduct these transactions using the CAQH CORE Operating Rules

Implement byJanuary 1, 2014

• Electronic funds transfer (EFT) transactions• Health care payment and remittance advice (ERA)

transactions

Implement byJanuary 1, 2016

• Health claims or equivalent encounter information• Enrollment and disenrollment in a health plan• Health plan premium payments• Referral certification and authorization• Health claims attachments

Operating rules encourage an interoperable network and, thereby, are vendor agnostic

Compliance in Effect as of January 1, 2013

Rule requirements available.


ACA Mandated Healthcare Operating Rules:

First Set - Eligibility & Claim Status


Mandated Eligibility & Claim Status Operating Rules

Compliance date January 1, 2013

Voluntary Eligibility & Claim Status

Operating Rule

Type of Rule Addresses CAQH CORE Eligibility & Claim Status Operating Rules

Data Content: Eligibility

Need to drive further industry value in

transaction processing

Infrastructure: Eligibility and Claim Status

Industry needs for common/

accessible documentation

Industry-wide goals for architecture/performance/connectivity

More Robust Eligibility

Verification Plus Financials

Enhanced Error Reporting and

Patient Identification

System Availability

Response Times

Companion Guides

Connectivity and Security

*Please Note: In the Final Rule for Administrative Simplification: Adoption of Operating Rules for Eligibility for a Health Plan and Health Care Claim Status Transaction, CORE 150 and CORE 151 are not included for adoption. HHS is not requiring compliance with any operating rules related to acknowledgement, the Interim Final Rule.

Mandated Eligibility & Claim Status Operating Rules: Scope –Effective as of January 1, 2013

Acknowledgements*

“We are addressing the important role

acknowledgements play in EDI by strongly encouraging the

industry to implement the acknowledgement requirements in the CAQH CORE rules we are

adopting herein.”

HHS Interim Final Rule

Enforcement Action Begins March 31, 2013


Three dates are critical for implementation of the first set of ACA mandated Operating Rules There are two types of penalties related to compliance1

ACA Federal Compliance Requirement Highlights:Eligibility and Claim Status

1 CMS OESS is the authority on the HIPAA and ACA Administrative Simplification provisions and requirements for compliance and enforcement. The CMS website provides information on the ACA compliance, certification, and penalties and enforcement process.2 According to CMS, regulation detailing the health plan certification process is under development, and they will release details surrounding this process later this year; CAQH CORE will continue to offer its voluntary CORE Certification program and will share lessons learned with CMS as the Federal process is developed.3 Covered life for which the plan’s data systems are not in compliance; shall be imposed for each day the plan is not in compliance4 Per the Jan 2, 2013 CMS OESS announcement of the 90-day Period of enforcement extension Discretion for Compliance with Eligibility and Claim Status Operating Rules

Key AreaHIPAA Mandated Implementation

ACA-required Health Plan Certification

Dates

First DateJanuary 1, 2013Compliance Date

Enforcement Date Extension March 31, 20134

Second DateDecember 31, 2013

Health Plan Certification Date

Third DateNo Later than April 1, 2014Health Plan Penalty Date

Description

Who: All HIPAA covered entities

Action: Implement CAQH CORE Eligibility & Claim Status Operating Rules

Who: Health plans

Action: File statement with HHS certifying that data and information systems are in compliance with the standards and operating rules2

Who: Health plans

Action: HHS will assess penalties against health plans that have failed to meet the ACA compliance requirements for certification and documentation2

Applicable Penalties

Amount: Due to HITECH, penalties for HIPAA non-compliance have increased, now up to $1.5 million per entity per year

Amount: Fee amount equals $1 per covered life3 until certification is complete; penalties for failure to comply cannot exceed on an annual basis an amount equal to $20 per covered life or $40 per covered life for deliberate misrepresentation


Compliance with Eligibility & Claim Status Operating Rules: 90-Day Period of Enforcement Discretion

• On January 2, 2013, CMS OESS* announced a 90-Day Period of Enforcement Discretion to reduce the potential of significant disruption to the healthcare industry

• Enforcement action will begin March 31, 2013 with respect to HIPAA covered entities (including health plans, health care providers, and clearinghouses, as applicable) that are not in compliance with the ACA mandated Eligibility and Claim Status Operating Rules

• OESS began accepting complaints associated with compliance with the operating rules on January 1, 2013

– If requested by OESS, covered entities that are the subject of complaints (known as “filed-against entities”) must produce evidence of either compliance or a good faith effort to become compliant with the operating rules during the 90-day period

• For more information review CMS’s Administrative Simplification Enforcement Tool (ASET), which is a web-based application where entities may file a complaint against a covered entity for potential non-compliance related to Transactions and Code Sets and Unique Identifiers

* CMS Office of E-Health Standards and Services (OESS) is the U.S. Department of Health and Human Services’ (HHS) component that enforces compliance with HIPAA transaction and code set standards, including operating rules, identifiers and other standards required under HIPAA by the Affordable Care Act.


Checkpoint #1: What do the Eligibility & Claim Status Operating Rules Mean for Providers?

– How do providers benefit from the Eligibility and Claim Status Operating Rules? • More accurate patient eligibility verification: Real-time information on health plan eligibility and

benefit coverage before or at the time of service– Providers experienced a 24% increase in electronic eligibility verifications*

• Improved point of service collections: Real-time provider access to key patient financials including YTD deductibles, co-pays, coinsurance, in/out of network variances via the ASC X12 v5010 270/271 transactions

• Decrease in claim denials: Real-time claim status data ensures provider is aware of status in billing process

– Providers experienced a 10-12% reduction in denials related to eligibility*

– How can my provider organization ensure we benefit from the Eligibility and Claim Status Operating Rules? • Identify all systems and vendors that touch the ASC X12 v5010 270/271 and ASC X12 v5010

276/277 transactions• Conduct internal gap analyses using the

CAQH CORE Eligibility & Claim Status Operating Rules Analysis & Planning Guide and/or reach out to your vendors to ensure compliance

* Based on the CAQH CORE Phase I Measures of Success Study when working with Phase I CORE Certified health plans.

The ACA mandated Eligibility & Claim Status Operating Rules ensure real-time access to robust eligibility and claim status data for providers


Mandated Healthcare Operating Rules:

Second Set - EFT & ERA


Mandated EFT & ERA Operating Rules:Required for All HIPAA Covered Entities

• Healthcare EFT Standard: July 2012 CMS announces CMS-0024-IFC is in effect adopting the NACHA ACH CCD plus Addenda Record (CCD+) and the X12 835 TR3 TRN Segment as the HIPAA mandated healthcare EFT standard

• EFT & ERA Operating Rules: August 2012: CMS published an Interim Final Rule with Comment, CMS-0028-IFC; adopts Phase III CAQH CORE Operating Rules for the Electronic Funds Transfer (EFT) and Health Care Payment and Remittance Advice (ERA) transactions except for rule requirements pertaining to Acknowledgements*

* CMS-0028-IFC excludes requirements pertaining to acknowledgements.

Compliance date for both the Healthcare EFT Standard and EFT & ERA Operating Rules is January 1, 2014


ProviderHealth Plan

CAQH CORE EFT & ERA Operating Rules in Action

Claims Processing

Claims Processing

Billing & CollectionsBilling &

CollectionsPayment/Advice (835)

TreasuryTreasury TreasuryTreasuryBankBank BankBank

Electronic Funds Transfer (CCD+/TRN)

Claims Payment Process

Stage 1:Initiate EFT

Pre- Payment: Provider Enrollment

EFT Enrollment Data Rule

ERA Enrollment Data Rule

Health Care Claim

Payment/Advice (835)

Infrastructure Rule

EFT & ERA Reassociation (CCD+/835)

Rule

Provider first enrolls in EFT and ERA with Health Plan(s) and

works with bank to ensure receipt of the CORE-required

Minimum ACH CCD+ Data Elements for reassociation

Uniform Use of CARCs &

RARCs Rule

Indicates where a CAQH CORE EFT/ERA Rule comes into play


Checkpoint #2: What do the EFT & ERA Operating Rules Mean for Providers?

– How will providers benefit from the EFT & ERA Operating Rules? • Standardized electronic enrollment for EFT/ERA: Providers will be able to enroll in both EFT and

ERA electronically with all health plans using a consistent set of data elements• Potential reduction in manual claim rework: With health plans more consistently using denial and

adjustments codes per the CORE-defined Business Scenarios, providers will have less rework• Reduction in A/R days: Automated and timely re-association of EFT and ERA leading to

efficiencies and reduced errors for payment posting

– How can my provider organization ensure we benefit from the EFT & ERA Operating Rules? • Identify all systems and vendors that touch the ASC X12 v5010 835 and the Healthcare EFT

Standard transactions• Conduct internal gap analyses using the

CAQH CORE EFT & ERA Operating Rules Analysis & Planning Guide and/or reach out to your vendors to ensure compliance

* Based on the CAQH CORE Phase I Measures of Success Study when working with Phase I CORE Certified health plans.

The ACA mandated EFT & ERA Operating Rules ensure more streamlined provider enrollment and processing of the EFT & ERA transactions


800+ CARCs

300+ RARCs

4 CAGCs

Inconsistent Use of Tens of Thousands of Potential Code

Combinations

Pre CORE Rule 360

Post CORERule 360

CORE Business Scenario #1:

Additional Information Required –

Missing/Invalid/Incomplete

Documentation(≈470 code combos)


Additional Information Required –

Missing/Invalid/ Incomplete Data from Submitted

Claim(≈300 code combos)


Billed Service Not Covered by Health

Plan(≈330 code combos)


Benefit for Billed Service Not

Separately Payable(≈30 code combos)

Code Combinations not included in the CORE-defined Business Scenarios may be used with other non-CORE Business Scenarios

Four Common Business Scenarios

Example: CAQH CORE Uniform Use of CARCs and RARCs Rule - Four Business Scenarios


Mandated Healthcare Operating Rules:

Third Set – Attachments, Prior Authorization, Enrollment, etc.


• Remaining operating rule mandate, effective January 1, 2016, will address the following transactions:

– Health claims or equivalent encounter information

– Enrollment and disenrollment in a health plan

– Health plan premium payments

– Referral certification and authorization

– Claims attachments

• Secretary of HHS recommended CAQH CORE as author for the remaining ACA mandated operating rules

– Q1 2013: Key opportunities/out of scope areas being identified via research, survey findings, and call discussions

– Q2 2013: Potential rule options will be developed, reviewed, and agreed upon by CORE Subgroups and Work Groups

– Q3 2013: CORE Subgroup and Work Group discussion and straw polling will be conducted

– Q4 2013: Detailed documentation of draft rule requirements by CORE Participants

Mandated Attachments, Prior Auths, Enrollment, etc.:Third Set


How to Contribute to Development of Third Set

• Entities are encouraged to join CAQH CORE to directly contribute:– The most effective way for individual organizations to assure they have direct input

on the mandated and voluntary operating rules is by becoming a CORE Participating Organization; any entity may join. Cost is extremely low or free. Benefits include:

• Participation on Subgroup/Work Group rules-writing calls, surveys, straw polls, and ballots; eligibility to Co-Chair

• Entity vote on CAQH CORE Operating Rules at Work Group and Full CORE Membership voting levels

• Access to CAQH CORE Education Sessions specific to CORE Participating Organizations

• Entities unable to join CAQH CORE can contribute via:– CAQH CORE Town Hall Calls

• CAQH CORE holds bi-monthly Town Hall calls which provide attendees an update on recent activities including status of rule development; email [email protected] to be added to the distribution list

– CAQH CORE Industry Surveys• CAQH CORE periodically conducts industry-wide surveys for directional feedback on

operating rule opportunities; email [email protected] to be added to the distribution list


Engaging Vendors


• HIPAA-covered entities work together to exchange transaction data in a variety of ways

• Vendors, often acting as business associates that provide services or process transactions on a provider’s behalf, play a crucial role in enabling provider clients to realize the benefits of industry adoption of CAQH CORE Operating Rules

• Key steps to ensuring streamlined administrative data exchange:

– Assess impacted systems/vendors: Understand which systems/vendors touch the administrative transactions

– Engage with your vendors: Confirm with vendors compliance/ability to support ACA mandated operating rules as certain vendors, including PMSs, third-party billing companies, etc. are not considered HIPAA-covered entities rather they act as the provider’s business associate

– Encourage voluntary CORE Certification: Work with your vendors to publicly confirm systems are conformant with applicable operating rules

The Importance of Industry Collaboration

STREAMLINED ADMINISTRATIVE DATA EXCHANGE

Vendor-Agnostic Rules

ProvidersCORE-

RequiredData &

Infrastructure

HealthPlans

Vendors/Clearinghouses(Vendors may not be HIPAA covered entities)

CORE- RequiredData &

Infrastructure


Analysis & Planning Guides Assist in Understanding Applicability of Rules to Various Trading Partners• CAQH CORE offers two Analysis & Planning Guides (for Eligibility & Claim Status and

EFT & ERA) which provide guidance for Project Managers, Business Analysts, System Analysts, Architects, and other project staff to complete systems analysis and planning for implementation of the CAQH CORE Operating Rules

• Guide should be used by project staff to:

– Understand applicability of the CAQH CORE Operating Rule requirements to organization’s systems and processes that conduct the transactions

– Identify all impacted external and internal systems and outsourced vendors that process the transactions

– Conduct detailed rule requirements gap analysis to identify system(s) that may require remediation and business processes which may be impacted

• The guides include three tools to assist entities in completing analysis and planning:– Stakeholder & Business Type Evaluation

– Systems Inventory & Impact Assessment Worksheet

– Gap Analysis Worksheet


Voluntary CORE Certification


Voluntary CORE Certification

• Since its inception, CAQH CORE has offered a voluntary CORE Certification to health plans, vendors, clearinghouses, and providers

– Learn more about voluntary CORE Certification here – Voluntary CORE Certification provides verification that your IT systems or product operates

in accordance with the federally mandated operating rules

• Certification and testing are separate activities – Testing is completed by CORE-authorized testing entities and occurs on-line based on

stakeholder-specific test scripts; test scripts developed by CORE participants – Cost of testing and certification is extremely low or free

• CORE Certification is a 4-step process:

1. Pre-certification Planning and Systems Evaluation: – Understand requirements of the CORE Operating Rules and scope your internal efforts to adopt

rules– CORE has free gap analysis tool; email [email protected]

2. Sign and Submit the CORE Pledge: – Formally communicate your intent to pursue CORE Certification

3. CORE Certification Testing: – Comprised of three phases: Pre-testing, Testing and Post-testing– Testing is by stakeholder-specific test scripts by rule

4. Apply for the CORE Certification Seal: – Entities successfully achieving CORE Certification will receive a CORE “Seal”

from CAQH that corresponds with the CORE Phase and stakeholder-type


Measures of Success


CORE Measures of Success: Tracking ROI

• CORE made an early commitment to track Measures of Success

• Health Plans, vendors and providers that are pursuing voluntary CORE Certification are invited to participate in the ROI study

– Also need participation from providers that are not CORE-certified, but trading data with CORE-certified entities

• CAQH CORE contracted with IBM to conduct tracking and analysis

– Analyze two 3-month measurement periods; volunteers asked to record expenses and then impact one year later

• Outcomes available from health plans covering 33 million lives and their vendor and provider partners

– Provider groups working with CORE-certified health plans saw 10-12% fewer claim denials and a 20% increase of patients verified prior to a visit

– The time needed by vendors and clearinghouses to connect to trading partners significantly reduces with a common approach to connectivity


• More robust and accessible data has and will continue to enhance the flow of information between providers and health plans

• CAQH CORE Operating Rules help stakeholders leverage investments

– Common infrastructure supports multiple methods and future transaction types

– Solutions reusable with new partners

• Streamlined implementation with CAQH CORE partners– Better technical skill and resources

– Less customization, reduced testing

– Lower cost connectivity using the public internet

• Costs to implement CAQH CORE Operating Rules vary widely, depending on how much technology change is required

The Business Case: All Stakeholders

* IBM assessed results achieved by Phase I CAQH CORE Operating Rules early adopters (represents 33 million covered lives and 1.2 million providers)


Checkpoint #3: Key Action Items for Providers

Determine if your organization is conducting the applicable electronic transactions:

– The ACA mandated operating rules only apply to providers if they are conducting the associated electronic transactions

If you conduct the transactions, assess your organization’s readiness/compliance: Use the CAQH CORE Analysis & Planning Guides (for Eligibility & Claim Status

and EFT & ERA) to help you assess impacted systems/vendors Speak with your PMS vendor* about their compliance/ability to support your

practice Ask your clearinghouse(s) if the product(s) your practice uses is compliant

(clearinghouses are HIPAA covered, and thus should already be compliant) If not already, encourage your vendors/clearinghouses to become voluntarily

CORE-Certified to test conformance

* REMINDER: PMSs are not HIPAA-covered entities, and thus are not mandated to be compliant - so provider requests are critical!


Additional CAQH CORE Resources

• Become a CORE Participant • Join us for these free CAQH CORE Education Events held jointly with:

– CMS OESS: “The Basics of Mandated Operating Rules for Providers”

• Wednesday, March 20, 2013 from 2:00pm-3:00pm ET

– ASC X12: “Eligibility and Claims Status Transactions: A Deep Dive”

• Tuesday, March 26, 2013 from 2:00 pm to 3:30 pm ET

– NACHA: “Save the Date” for an in-depth look at the EFT Standard and EFT & ERA Operating Rules

• Tuesday, April 10, 2013 from 2:00 - 3:00 pm ET

• Review the CAQH CORE Operating Rules for free

• Access general FAQs regarding the ACA operating rules mandate

• Submit your questions to the CAQH CORE Request Process by emailing [email protected]


Appendix


ACA Mandated Eligibility & Claim Status Operating Rules

*NOTE: In the Final Rule for Administrative Simplification: Adoption of Operating Rules for Eligibility for a Health Plan and Health Care Claim Status Transaction, requirements pertaining to use of Acknowledgements are NOT included for adoption. Although HHS is not requiring compliance with any operating rule requirements related to Acknowledgements, the Final Rule does note “we are addressing the important role acknowledgements play in EDI by strongly encouraging the industry to implement the acknowledgement requirements in the CAQH CORE rules we are adopting herein.”


ACA Mandated EFT & ERA Operating Rules

* CMS-0028-IFC excludes requirements pertaining to acknowledgements.

committee on operating rules for information exchange (core ® ) understanding the value of the aca...

Documents

set of operating rules

wide operating rules

operating rulesreview

mandated operating rulestoday

information exchange

administrative transactions

health plansenable providers

adoption of industry