Blog: HIPAA 5010 contingency plan needed, says MGMA

The Medical Group Management Association (MGMA) is calling on the Department of Health and Human Services (HHS) to issue a HIPAA 5010 contingency plan permitting health plans to adjudicate claims that may not have all the required data. MGMA’s research suggests that critical coordination among many practices and their trading partners has not yet occurred. Practices that do not successfully implement Version 5010 by the Jan. 1, 2012, compliance date face possible disruption in cash flow, say experts. MGMA is asking HHS:

• to encourage providers and health plans to concentrate strictly on the most critical data content requirements.
• if the claim contains the minimum content required to successfully adjudicate the claim, HHS should not penalize health plans by requiring them to reject it.
• Medicare should take the lead and announce that minor errors in the claim will not trigger an automatic rejection
• to delay more stringent adherence to the requirements after the vast majority have adopted the Version 5010 formats.

Key findings of the study:

• 76.8% of study respondents have heard from the practice management system software vendors regarding the transition to 5010, 
• 35% indicate that internal testing has begun.
• 21.7% reported that internal testing with their practice management system vendor has not yet been scheduled. 

Health plans:

• 5.7% of respondents indicate that all their major health plans have contacted them,
• 35% reported that some of their major health plans have contacted them.
• 15% said external testing has started with all of their major health plans,
• 15.3% said testing had started with some of their major health plans.
• 27% reported that external testing has not yet been scheduled.

Contingency plans following the January 1 compliance date:

• 33.3% expected to establish a line of credit at a local financial institution; 
• 35.6% were planning on setting aside cash reserves to sustain operations, 
• 50.6% reported that they planned to revert to paper claims in an attempt to avoid cash flow issues.

Current implementation status. 

• 4.5% of practices rate their 5010 implementation status as fully complete
• 50% rate it as between 26 and 99 % complete
• 40% report their current implementation status as less than 25% complete. 

“It is unacceptable to expect physician practices to take such drastic action, such as reverting to paper claims, to avoid serious cash flow issues resulting from this mandate. Many health plans have transitioned staff away from handling paper claims, and we are concerned that a sudden, large increase in volume could also result in delayed payments.” said Susan Turney, MD, MGMA president and CEO.