Testimony for the National Committee on Vital and Health Statistics
Standards and Security Subcommittee

HIPAA-Readiness Survey Findings

Presented by:
Joyce Sensmeier, MS, RN, BC, Director of Professional Services
Healthcare Information and Management Systems Society

December 14, 2001

The Healthcare Information and Management Systems Society (HIMSS) would like to thank the National Committee on Vital and Health Statistics (NCVHS) for offering us this opportunity to survey healthcare information technology vendors regarding the state of compatibility of their software products with the Health Insurance Portability and Accountability Act (HIPAA) mandates for the Transaction and Code Sets rule. My name is Joyce Sensmeier, and I am the Director of Professional Services at HIMSS. I am also a registered nurse, board certified in nursing informatics. HIMSS was pleased to act as a neutral third-party data collector for these results; the participation of HIMSS in this project was solely for the purpose of facilitating data collection and analysis. Based in Chicago, with an office in Ann Arbor, HIMSS has 37 chapters and more than 12,000 individual members, healthcare professionals ranging from senior staff to chief information officers and chief executive officers working in healthcare organizations throughout the world. HIMSS also serves corporate members, which include suppliers and consultants in the health information and management systems industry.

General Information

Twenty-eight of the leading software companies in the industry were invited to provide us with data regarding the status of compatibility of their products with regard to implementation of the HIPAA Transaction and Code Sets rule, scheduled to take effect in October 2002. Survey data were collected for a one-week period, from December 3 through 10, 2001. The anonymity of respondents was maintained. Each company was asked to complete the survey for each of their products that would be affected by this regulation. Therefore, it was possible for a company to submit the survey more than once. Responses were received for 25 products that represent almost 4,700 installations in the healthcare IT marketplace. The products represented by the respondents have a wide range of installation bases—from six to over 1,500. Industry segments represented by the respondents include the ambulatory care, hospital, professional practice setting, payor organization and sub-acute care facility markets.

Support for X12 Format 4010 version

Vendors were asked which of the nine electronic transactions identified in the HIPAA Transaction and Code Sets rule would be supported by their products in the X12 format 4010 version. The most widely supported transactions are X12 837 P (Healthcare Claims—Professional), X12 270/271 (Eligibility Benefit Inquiry and Response) and X12 835 (Payment and Remittance Advice). Each of these transactions will be supported by 24 of the 25 products represented. Additionally, 92% of the products in this study will support X12 837 I (Healthcare Claims—Institutional) transactions. The least supported transaction will be X12 837 D (Healthcare Claims—Dental). This transaction will be supported by only four of the products for which data were made available. This may be due to the possibility that these other products simply do not require this component. Three of these four products are found in payor organizations and have between 60 and 150 installations. The remaining product is a hospital-based product.

Additionally, two of the products are reported to support all nine of the electronic transactions in the X12 format 4010 version. Both of these products reported that payor organizations are their market segment. They have a total of 150 installations. Table A below details specific information regarding which electronic transactions will be supported in the X12 format 4010 version. Table B below details which products will support each electronic transaction, by industry type and number of installations.

HIPAA Data Content Supported

The transaction that will most widely support HIPAA data content will be X12 270/271 (Eligibility Benefit Inquiry and Response), which will be supported by 22 of the 25 reporting products. Payment and Remittance Advice (X12 835) and Healthcare Claims—Professional (X12 837 P) will each be supported by 20 of the 25 reporting products. The least supported electronic transaction is X12 837 D (Healthcare Claims—Dental). Only one product, which serves the hospital marketplace, will support HIPAA data content for this type of electronic transaction. Table A includes a detailed listing of each electronic transaction and identifies how many products are reported to fully support the electronic transaction. Table C below details which products will support HIPAA data content, by industry type and number of installations.

All of the electronic transactions for which vendors reported that products would have full support for HIPAA data content were also reported to fully support the X12 format 4010 version. However, as the above percentages suggest, there are transactions that will support the X12 format 4010 version that will not fully support HIPAA data content. On average, only 85% of the electronic transactions that support the X12 format - 4010 version are also scheduled to support HIPAA data content. {This excludes X12 837 D (Healthcare Claims—Dental), which is not a component of all of the products in this study.} All of the instances in which the X12 format 4010 version is supported and HIPAA data will not be supported were reported by four products. These products serve either the ambulatory or payor organization markets.

Third-Party Certification

Seventeen of the products are reported to have used a third-party certifier for testing the compatibility of their electronic transfers with the new HIPAA mandates. All of these products identified CLAREDI as the third-party certifier in use.

On average, each of the nine electronic transfers was tested for compliance by a third-party certifier for 60%–68% of the products for which data were provided. The only electronic transfer that does not fall into this range is X12 837 D (Healthcare Claims—Dental). This electronic transfer was not reported to have undergone third-party testing by any of the reporting products. With one exception in the ambulatory market, the products reporting third party certification testing for a transaction also reported that the transaction would support both the X12 format 4010 version and HIPAA data content. Table A details specific information on third-party certification by electronic transaction.

Product Upgrade Requirements and Availability

The majority of the respondents identified that a software upgrade is needed in order to be compatible with the new Transaction and Code Sets rule. Only two products were identified in which a product upgrade is not needed in order to have HIPAA-compliant transactions. Both of these products are in the hospital marketplace.

Of the 23 products identified as needing an upgrade for compatibility, 83% (19) will be made available to users at no cost. A fee is required for the purchase of upgrades for the remaining 17% of products. These three products represent three different marketplaces—payor, hospital and professional setting. These products also have a varied number of installations (six to 105).

Vendors anticipate that users requiring a product update to be in compliance with the new mandate will need implementation assistance. The vendors for all 25 products reported that implementation assistance will be provided to their clients.

Products that require upgrades will be available to users in advance of the October 2002 deadline for compatibility. Six of the products that will require an upgrade have that upgrade currently available or scheduled to become available in the next month. The remaining product upgrades are reported to be available to users within the next three to six months. It would appear that this timeline would allow a reasonable schedule for testing with their clients.

Conclusion

In summary, the vendor companies reported in this study appear to have made significant strides toward meeting the compliance deadlines of the HIPAA Transactions Code Sets rule. A majority of the products on which data was made available will support electronic transactions in the X12 format 4010 version. A lesser number of these products will support HIPAA data content. Additionally, about two-thirds of the electronic transfers that will be supported have been tested by a third-party certifier. In this context, vendors are moving forward and all of the products are reported to be available as HIPAA-compliant by the October 2002 deadline. The majority of the vendors are conscious of the costs to their users and are providing the upgrades to them at no charge. They are also aware of the implementation needs of their users and are prepared to provide them with the assistance needed to install the modified software.

Thank you again for the opportunity to present these findings. HIMSS, as a member of the Coalition for Health Information Policy (CHIP), is gratified to see these results, as we have expressed our opposition to legislative proposals that would delay the October 2002 compliance deadline for the Transaction Standards regulation. CHIP represents a broad array of professionals and organizations involved in the development, use, management, and security of health information systems, across all sectors of the healthcare industry. We have met with staff of House leaders on health policy issues to review the significant financial and staff commitments made by many covered entities and their resulting steady progress toward compliance with HIPAA’s administrative simplification regulations. In addition, we have provided information to the Department of Health and Human Services (HHS) and the Congressional Budget Office (CBO) regarding compliance issues, including the very limited impact on, and cost to, small providers in coming into compliance with the Transaction Standards rule. We welcome any opportunities to be of assistance regarding this endeavor in the future.

About the Healthcare Information and Management Systems Society (HIMSS)

The Healthcare Information and Management Systems Society (HIMSS) provides leadership in healthcare for the management of technology, information, and change through member services, education and networking opportunities, and publications. Members are kept abreast of the latest industry information and research, as well as legislative and policy issues. Based in Chicago with an office in Ann Arbor, Mich, HIMSS has 37 chapters and more than 12,000 individual members working in healthcare organizations throughout the world. Individual members include healthcare professionals in hospitals, corporate healthcare systems, clinical practice groups, HIT supplier organizations, healthcare consulting firms, and government settings in professional levels ranging from senior staff to CIOs and CEOs. HIMSS also serves corporate members, which include suppliers and consultants in the health information and management systems industry. HIMSS’ Web site is www.himss.org.

APPENDIX OF TABLES

Table A

Summary of Electronic Transactions Supported

Table B

Electronic Transactions Products Supported in X12 Format - 4010 Version

Table C

Electronic Transfers that Support HIPAA Data Content