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HHS Proposed Regulations Address Unique Health Plan Identifiers and Delay Code Sets Compliance Date
Practical Law Legal Update 1-518-8845 (Approx. 4 pages)
HHS Proposed Regulations Address Unique Health Plan Identifiers and Delay Code Sets Compliance Date
by PLC Employee Benefits & Executive Compensation
| Published on 11 Apr 2012 • USA (National/Federal) |
The Department of Health and Human Services (HHS) has issued proposed regulations that address, among other things, the adoption of unique health plan identifiers and an identifier for other entities, and change the compliance date for implementing certain updated electronic code sets under the Health Insurance Portability and Accountability Act (HIPAA).
HHS has issued proposed regulations that:
- Address the adoption of a standard unique health plan identifier (HPID), as required under the Affordable Care Act (ACA).
- Adopt an identifier for non-health plan entities, including third-party administrators (TPAs).
- Delay the compliance date for transitioning to certain updated electronic code sets.
In general, all health plans that transmit health information electronically in connection with HIPAA covered transactions must comply with transaction standards adopted under HIPAA. The transaction standards are intended to standardize the exchange of electronic data by reducing the use of multiple formats.
Unique Health Plan Identifier
Currently, health plans, TPAs and other entities that conduct plan-related functions are identified using different identifiers (for example, employer identification numbers) that have different sources, formats and meanings. For health care providers, these varying identifiers can result in:
- Improper routing of transactions and difficulty determining patient eligibility.
- Rejected transactions because of insurance identification errors.
The HPIDs will:
- Identify health plans that send or receive HIPAA electronic transactions.
- Provide uniform identifiers for purposes of the HIPAA electronic transactions standards so that health plans do not use multiple identifiers in covered transactions.
Under the proposed regulations, all covered entities must use an HPID anytime a covered entity identifies a health plan in a covered transaction. The regulations distinguish between health plan entities that:
- Must obtain an HPID, referred to as controlling health plans (CHPs).
- Are eligible, but not required, to obtain an HPID, referred to as subhealth plans (SHPs).
Once final, the regulations will be effective October 1, 2012. All covered entities, except small health plans, must comply with the HPID rules by October 1, 2014. Small health plans will be required to comply by October 1, 2015. Under HIPAA regulations, a small health plan is a plan with annual receipts of $5 million or less.
Other Entity Identifiers for TPAs and Others
The regulations also include an optional identifier (OEID) for certain entities, including TPAs, that are:
- Not health plans, which means they cannot obtain a health plan identifier, though they perform health plan functions.
- Currently being identified in standard transactions in the same fields as health plans, depending on the contractual relationship between the plan and the other entity.
The other entities would not be required to obtain an OEID but could obtain and use one if they are identified in covered transactions.
ICD-10 Compliance Date Delayed to October 1, 2014
Under HIPAA, certain information must be transmitted using standardized code sets for medical data. In 2009, HHS published final regulations that:
- Replaced existing International Classification of Diseases (ICD) codes (ICD-9 codes) for diagnosis and procedure codes with updated ICD-10 codes.
- Included a compliance date of October 1, 2013.
Due to concerns over industry readiness for the transition to ICD-10, the proposed regulations delay the ICD-10 compliance date from October 1, 2013 to October 1, 2014. The delayed compliance date will give covered entities, including health plans, more time to prepare and test their systems.
Practical Impact
The cost of implementing the proposed HPID requirements would fall primarily on health plans, which would need to reprogram information systems to accommodate HPIDs and create bridges between existing identifiers and HPIDs. Also, according to HHS, self-insured group health plans that are CHPs would be required to obtain HPIDs. This is despite the fact that many self-insured plans contract with TPAs or other entities to carry out health plan functions and those other entities, as opposed to the plans themselves, are often identified in the standard transactions.
The regulations are the third in a series of regulations required under the ACA aimed at streamlining health care transactions. The first two sets of regulations in this series adopted:
- Operating rules for electronic transactions (see Practice Note, HIPAA Electronic Transactions under the ACA, which will be updated for the HPID proposed regulations).
- Standards for electronic funds transfers and remittance advice transactions between health plans and health care providers (see Legal Update, HHS Regulations Adopt Standards for HIPAA Electronic Funds Transfers).
Future regulations will address adoption of:
- Standards for claims attachments.
- Requirements for health plans to certify compliance with all HIPAA standards and operating rules.