Electronic Transactions and Code Sets Requirements

May 16, 2002 Advisory

Electronic Transactions and Code Sets Requirements

File Compliance Plan by October 15, 2002 to Extend Compliance Deadline

These regulations and associated implementation guides establish standards for certain electronic transactions, such as electronic billing, and data elements for these transactions to standardize the electronic exchange of health information. (The final electronic transactions and code set requirements and implementation guides are available at www.aspe.hhs.gov/admnsimp/bannertx.htm.) Compliance with these requirements generally involves coordination with one or more software vendors and then testing compliance capability. The original compliance deadline is October 16, 2002 (except for small health plans). However, Congress recently extended that compliance date to October 16, 2003 if the covered entity submits a compliance plan to the Department of Health and Human Services (HHS) by October 15, 2002. In the Administrative Simplification and Compliance Act ("ASCA") of December 2001, Congress authorized HHS to exclude from Medicare any covered entity that does not either file a compliance plan or become compliant with the electronic transactions and code sets requirements by October 16, 2002. HHS has issued a model compliance plan and associated instructions, which are available on the HHS HIPAA web site at www.cms.gov/hipaa. Although use of the HHS model plan is optional, it is simple and straightforward. Completing the HHS form ensures that you have satisfied the requirements for filing a compliance plan. The plan may be filed electronically or on paper. In the plan, the covered entity must address the reason for the extension request, the work plan for achieving compliance and plans to begin testing by April 16, 2003.

Most providers will need to obtain the extension of this compliance deadline. Many vendors will not be prepared to meet the original 2002 deadline. Since most large payor organizations will not be ready, testing would be extremely difficult this year. In addition, there may be changes during the year to some of the standards. And there is no disadvantage to filing for the extension.

Your compliance efforts now for the electronic transactions and code sets requirements should include:

  • Obtain and review HHS model compliance plan form and instructions.
  • Determine which covered electronic transactions are performed by your organization.
  • Work with your software vendors to be certain that they will upgrade your systems as needed for compliance and to determine timetable.
  • Identify any additional data elements that must be collected in order to comply with applicable standards.