National Director
representing
The National Association of Claims Assistance Professionals, Inc.
(NACAP)
January 21, 1997
Prepared Comments for
Subcommittee on Health Data Needs, Standards & Security
National Committee on Vital and Health Statistics (NCVHS)
by Norma L. Border, National Director representing
The National Association of Claims Assistance Professionals, Inc. (NACAP)
January 21, 1997
Dr. Starfield, Dr. Lumpkin and Members of the Subcommittee on Health Data Needs, Standards and Security, I am Norma Border, National Director for the National Association of Claims Assistance Professionals (NACAP). On behalf of NACAP members, I thank you for this opportunity to comment on the impact of administrative simplification and adoption of standards as required by the Health Insurance Portability and Accountability Act of 1996.
The National Association of Claims Assistance Professionals is a non-profit individual professional society founded in 1991, with almost two thousand members nationwide. We invite anyone with an interest in health care administrative issues to join NACAP. However, NACAP's members fall into two primary small business categories that will be impacted by HIPAA: claims assistance professionals (CAPs) and electronic claims professionals (ECPs).
A Claims Assistance Professional (CAP) is essentially a consumer ombudsman, an independent consultant with extensive knowledge and expertise in health insurance administration. CAPs are not employed by health insurers nor do they market or sell health insurance. CAPs are small business owners working solely for the benefit of their client, the health care consumer. A Rand Institute study in 1989 found that consumers view health insurance claim forms as only slightly less complex than completing an IRS 1040. With the proliferation of managed care organizations (MCOs), the hurdle of getting a health claim paid has been replaced with a maze of gatekeeper mechanisms that consumers find as daunting as dealing directly with insurers.
A Claims Assistance Professional works with insurers and providers to resolve any claims filing problems to ensure prompt payment to their clients and to health care providers. CAPs assist their clients in challenging denied claims or gatekeeper restrictions through the available administrative appeals processes. CAPs serve: double income families with dual health care coverage, members of the sandwich generation dealing with aging parents, parents of children with acute or chronic illnesses, AIDS patients, and Medicare beneficiaries. CAPs assist attorneys, legal guardians, estate executors and trustees to conserve and protect the assets of the funds they administer by ensuring claims are paid by the appropriate health care insurer.
An Electronic Claims Professional (ECP) provides the electronic administrative link between the small to medium size physician practice, health care facility and the major health insurers, including Medicare. An ECP, under contract to a physician or facility, keys patient identification and billing information into a computer and transmits it to the appropriate health care payer. ECPs are small business owners and trained claims professionals, who are knowledgeable in computer software and hardware as well as electronic data transmission requirements and health care claim reimbursement. Electronic submission of health insurance claims by an ECP assures the physician or facility that claims are submitted accurately and will be paid promptly.
The Electronic Claims Professional moves the burden of claim preparation and submission out of the small to medium size physician practice, reducing staffing, training and overhead costs. However, the primary advantage the ECP provides is faster claims payment, error free processing and lower outstanding accounts receivable for the medical practice. For the last ten years, the Health Care Financing Administration as well as major health care payers have been stymied in their efforts to bring the small health care provider into the electronic claims environment. The ECP provides the level of service, accountability and technological control the independent practitioner or small group practice needs in electronic claims handling.
NACAP's primary goals as a trade association are: to provide a national identity for CAPs and ECPs; to administer a professional certification program; to further the professional growth of CAPs and ECPs through information and training; and to enhance consumer, health insurer as well as state and federal government recognition of the services our members provide. NACAP fulfills these goals through its publications, certification program, seminars, national conference and referral programs.
NACAP conducts a voluntary professional certification program for professionals in both fields and awards the Certified Claims Assistance Professional (CCAP) title and the Certified Electronic Claims Professional (CECP) title. Certification candidates are required to sit for a proctored examination, testing their expertise and knowledge of health insurance as well as CAP or ECP special knowledge requirements. Initiated in 1992, the certification test program is updated and reviewed annually by a Certification Committee of NACAP members, representative of the industry, under the supervision of an independent psychometric consulting firm. A Technical Committee of ten health industry experts also reviews the exam for timeliness and accuracy of its content. The NACAP Certification test is offered to members and non-members annually.
The National Association of Claims Assistance Professionals actively participates in the Workgroup on Electronic Data Interchange (WEDI) and I serve WEDI as a board member. NACAP's Executive Director, Kathryn Dokas serves as a commissioner on the Electronic Health Network Accreditation Commission (EHNAC). NACAP staff and members have served on various HCFA/BPO Technical Advisory Groups and Work Groups, the most recent being the HCFA Payer Identification Work Group.
In response to the questions presented to NACAP for comment by Subcommittee on Health Data Needs, Standards & Security, I offer the following:
Q. 1(a).What are NACAP's expectations for the results of the Administrative Simplification standards requirements in the Health Insurance Portability and Accountability Act of 1996 (HIPAA)?
A. NACAP looks to HIPAA's administrative simplification and standards requirements to cut through some of the long-standing Gordian knots that have left the health care industry trailing behind other major service industries benefiting from the adoption of electronic commerce transactions. NACAP has participated in WEDI since 1993 and applauds the voluntary progress achieved so far within the healthcare industry. However, NACAP shares HCFA's frustration with those instances where proprietary issues have slowed or brought progress on healthcare EDI to a screeching halt. I recognize that in these instances the entities involved have made long-term and substantial financial investments. However, everyone must be ready to invest in the adoption of standards in order to achieve the benefits and savings inherent in administrative simplification.
Q.1(b). In what ways will the outcome affect the members of NACAP, both positively and negatively?
A: HIPAA standards requirements will affect every NACAP member and the clients they serve. We believe that HIPAA's focus on unique identifiers will help the healthcare transactions industry as a whole become more aware of NACAP members' positive contributions to the claims process. However, NACAP members will be required to incorporate and maintain standards requirements in their own operations and this will increase their costs. Members understand the legislation could require them to invest time and money to update equipment, software and procedures to enable the effective interface with other healthcare transaction processors. In its present state, the legislation is not clear on how CAPs and ECPs will be defined for unique identifier purposes. CAPs working on behalf of the consumer in filing or resolving claims issues may fall under the health clearinghouse category, while ECPs submitting claims should fall under the health provider category.
For the CAP, standards will mean adding and maintaining a new unique identifier for their consumer clients as well as identifiers for health care facilities as well as health care payers. For the ECP, standards will mean maintaining identifiers for the health care facilities as well as health care payers, insuring that claims are routed correctly within the EDI system and paid promptly. NACAP members, whether CAP or ECP, recognize their roles as health information trustees and anticipate being appropriately identified within the standards process. Our members already have internal security procedures to protect the privacy of client data. Both CAPs and ECPs will, under this legislation, have to invest capital to change their existing computer and paper-based systems, train personnel and update their procedures.
But we are concerned that CAPs and ECPs may be overlooked or excluded as a result of standards definitions or requirements. We participate in the system and need to be assured of access to data. The CAP's ombudsmen role argues for the necessity of an identifier of their own to assure appropriate access to health claims data and the ability to initiate and resolve problems with system generated data on behalf of their client, the consumer. The ECP's role as a facilitator of electronic commerce for the small to medium sized health care provider argues the necessity of an identifier of their own to assure appropriate access to health claims data and the ability to initiate and resolve problems with system generated data on behalf of their client.
Another concern is the financial impact of any new standards that could prove difficult or disproportionately costly for these small businesses which directly serve the health care provider and consumer.
NACAP is also concerned with the selection and use of a unique patient identifier. I served on the WEDI Patient Identifier Subcommittee in 1993-1994. The WEDI subcommittee investigated a wide range of simple to elaborate biometric methods for creating and maintaining a unique patient identifier. The consensus and recommendation of the WEDI Patient Identifier Subcommittee was to use the individual's Social Security Number (SSN). I am familiar with the objections being raised by the Social Security Administration (SSA). However, the sanctity of the SSN can hardly be argued at this late date when banks, colleges, and even insurers have adopted its use as an identifier, unchallenged by SSA.
Use of the SSN as a unique identifier for the health care consumer is the least expensive option to implement. It does require investment in resolving existing numbering problems within the SSA system. To ensure patient data confidentiality, it seems more appropriate to establish mechanisms that restrict access only to appropriate health information trustees. Cost savings achieved through administrative simplification should not be used to cover the astronomical cost of creating an elaborate new encrypted identifier system for the health care consumer.
Q. 2 Does NACAP have any concerns about the process being undertaken by the Department of Health and Human Services (DHHS) to carry out the Administrative Simplification requirements of this law? If so, what are those concerns and what suggestions does NACAP have for improvements?
A. HIPAA legislation dictates some very stringent time frames for the selection, adoption and implementation of standards requirements that will be all-pervasive in their impact not only on NACAP members, but on every entity involved in healthcare EDI. To paraphrase an old data processing joke, no matter how hard they try, nine women cannot deliver a whole baby in one month.
I believe the legislative muscle of HIPAA should be used to expedite reaching consensus in the healthcare industry on the various standards within the timeframes dictated by the legislation. However, adoption and implementation can't be achieved by simple governmental fiat. Standards represent significant investments for the entire health care industry. The goal of administrative simplification will not be achieved if the pace is set so aggressively that parity in participation cannot be maintained among players, i.e., both large and small: software vendors, claims assistance and electronic claims professionals, equipment suppliers, health care facilities, health care payers, managed care organizations and, not least of all, the health care consumer.
Q. 3(a). What major problems are experienced by the members of NACAP with the current transactions specified under the HIPAA?
A. All NACAP members suffer from the lack of standards in the healthcare transaction industry. NACAP's ECP members are at the front end of the health claims process. They collect patient information, diagnostic information and procedural information from the physician's office. Medical billing software converts that information into one of two current standard claims formats, either NSF or ANSI. The health claim information is transmitted electronically to one or more health care payers as indicated in the patient information. Lack of standardized code sets identifying the patient, the provider and the payer routinely result in health claims being rejected or denied by the payer, resulting in duplicate processing and increased costs in healthcare.
NACAP's CAP members attempt to resolve the mess at the back end of the claims process on behalf of the health care consumer. The mess can be claims that are denied because of missing information from the provider or the patient. It can be claims that are rejected when clerical errors make policy numbers or procedure codes invalid in the payer's claim processing system. It can be claims that are rejected by one or more insurers because the initial information is insufficient to determine which insurer should be the primary payer and which secondary. When a health insurer rejects a claim, the health care provider has no recourse but to seek full payment from the patient. The health care consumer is suddenly faced with an astronomical bill for medical services that few are prepared to pay unassisted. Much of a CAPs time is spent resolving errors caused by the lack of national standards and the proliferation of proprietary systems.
Q. 3(b). For generators of the data, how readily available is the information that you need to provide for the transactions?
A. NACAP members, whether CAP or ECP, do not generate health care data. In either instance, they are dependent on claim or encounter information generated by the health care provider.
Q. 3(c). and how meaningful is that information from a clinical perspective?
A. As this area does not impact our members, NACAP has no comment.
Q. 3(d). For users of the data, are you receiving the information you need from the transactions to pay the bill, manage the care process, etc.?
A. Currently, NACAP's ECP members receive patient encounter data from the health care provider to convert into the appropriate format for electronic submission to the payer. In the past few years, payer attempts at improving standards, software and system edits have raised the accuracy level of health claim submissions, thus speeding up payments to providers. However, ECPs must still accommodate non-standard claims filing requirements from various payers in order to successfully submit claims for their provider clients.
NACAP's CAP members use the information received by their clients from their health insurer to resolve what goes wrong in a health insurer's automated claims processing system. What starts out as a highly automated process between the provider and payer degenerates to a long, manually labor intensive process of phone calls and follow-up correspondence for the health care consumer unlucky enough to have a claim rejected. Health care payers adopt a rather Napoleonic attitude regarding rejected claims. The onus is on the health care consumer to prove that the health care payer has indeed made a mistake in rejecting the claim. Standards in treatment protocols as well as standards in reporting language, reporting times and appeals processes would help the CAP as well as the healthcare consumer to resolve claims issues.
Q. 3(e). What is your perception of its quality?
A. The quality of healthcare claims and administrative data is improving slowly but non-standard formats, terms and definitions determined independently by each payer still bring a lottery quality to health claim submission and payment.
Q. 4. How can the goal of administrative simplification best be achieved while meeting the business needs of the stakeholders?
To meet the goals of administrative simplification, the Secretary must take a pro-active stand on many issues. Recommendations from health industry representatives, especially regarding cost and implementation time frames, should be respected and recognized, but not to the detriment of the timeframes imposed in the legislation. The impact of any change must be reviewed to determine the cost burden on smaller businesses in the healthcare transaction industry. Arguments for unique requirements, those that do not effectively serve the majority, should not be endorsed or supported. Past attempts at consensus have dragged on to limited achievement; to implement the goals of HIPAA, the Secretary, while listening to the concerns of the stakeholders, must make the hard decisions necessary to create one national standard for health care transactions that will reduce costs and increase efficiency for healthcare providers, payers, businesses and health care consumers.