COM W. Rishel

Transcription

1 W. Rishel Research te 15 September 2003 Commentary HIPAA Transactions: Steady, but Inadequate, Progress Gartner's eighth survey of HIPAA compliance finds steady progress toward the deadline. The progress, however, is not sufficient for many covered entities to be ready by 16 October In August 2003, Gartner completed its eighth survey on compliance with the U.S. Health Insurance Portability and Accountability Act (HIPAA) Administrative Simplification subtitle. As described in "Hows and Whys of Latest HIPAA Transaction Minisurvey," this survey focused on progress toward the rapidly approaching deadline for transactions and code sets. As shown in Figure 1, we asked about the completion of system modifications and interfaces for HIPAA transactions. The 13 percent of the healthcare payer organizations (payers) that reported being complete is an improvement from 8 percent in February (See "HIPAA Progress Status for COMPARE Level Four" for information on the seventh HIPAA survey.) Similarly, the 7 percent of providers that reported that they had completed the changes was a big percentage improvement over the 2 percent that said the same in February 2003, although not encouraging on an absolute basis. Gartner 2003 Gartner, Inc. and/or its Affiliates. All Rights Reserved. Reproduction of this publication in any form without prior written permission is forbidden. The information contained herein has been obtained from sources believed to be reliable. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of such information. Gartner shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof. The reader assumes sole responsibility for the selection of these materials to achieve its intended results. The opinions expressed herein are subject to change without notice.

2 Figure 1 System Modifications for HIPAA 2% planning in the next 12 months 2% not planning in the next 12 months 13% Completed 7% Completed 87% currently engaged in 88% currently engaged in Payers Providers Have you implemented and tested system modifications, interfaces and conversions for HIPAA compliance? (August 2003) In a world of perfectly planned and executed projects, we would expect this milestone to be reached before a covered entity would make an investment in testing with trading partners. This is clearly not the case, however, for HIPAA implementations. Figure 2 shows that 89 percent of our payers reported that they had completed or were currently engaged in testing with trading partners, although Figure 1 shows that only 13 percent were done with all conversions. This anomaly stems from two sources: Most payers have more than one system that must process or create HIPAA transactions. Clearly, they have prioritized the changes that support claims, remittance advice and eligibility transactions. Those critical systems may be complete, even though the payer cannot report that all conversions are complete. Payers are experiencing some counter-productive overlap in their development cycles 40 percent report they are still working on internal testing of the claim transaction, even as 49 percent report they are doing external testing. Figure 2 also shows substantial progress between February 2003 and August 2003 on every transaction. The comparison is determined by comparing the vertical bar for a given transaction with the horizontal bar that it crosses. For example, in February 2003, only 20 percent of payers were reporting that they had completed or were currently engaged in external testing of the remittance advice; in August 2003, 61 percent were reporting that they had completed or were currently engaged in external testing of the remittance advice. The blue and black bars in Figure 2 represent completion of external testing with all trading partners. It is likely that statistic will continue to be very low for health plans that have many sources of transactions because they cannot report completion until all of their trading partners have become ready to test. 15 September

3 Figure 2 Payer Testing Status What is your testing status for these HIPAA transactions, internally or with trading partners? (August 2003) Percentage of Payers Claim 835 Remittance Advice 270/271 Eligibility 277/276 Claim Status 278 Referrals 820 Premium Payment 834 Enrollment/ Disenrollment Internal Complete Internal Currently Engaged In External Complete External Currently Engaged In Status in February 2003 The pattern of work by transaction type continues to follow the trend we found in our February 2003 data. Claims and remittance advice are the highest priority followed closely by eligibility and claim status. This is important if the industry is to avoid the crisis described in "Contingency Planning for a Possible HIPAA Claims Crisis." The premium payment and enrollment transactions have made excellent progress. Gartner believes that this is because they are relatively simple transactions, they affect different applications and there is a clear cost advantage to payers who get these transactions working. The testing status for providers is shown in Figure 3. Once again we see excellent progress on the claim and remittance advice, although 89 percent of providers are still in internal testing. There is no chance that all of these providers could complete testing with all of their trading partners in the two months that remained when we closed our survey. The providers, as a group, are putting less emphasis on eligibility, claim status and referrals than are the payers. 15 September

4 Figure 3 Provider Testing Status What is your testing status for these HIPAA transactions, internally or with trading partners? (August 2003) 837 Claim Percentage of Providers Remittance Advice 270/271 Eligibility 277/276 Claim Status 278 Referrals Internal Complete Internal Currently Engaged In External Complete External Currently Engaged In Status in February 2003 Given the general lack of readiness, we asked our panelists if they expected to send or receive noncompliant transactions after 16 October Figure 4 shows their responses. The percentage of payers expecting to accept noncompliant transactions is much larger than the percentage of providers that expect to send them, even if you count the 21 percent provider "don't know" responses as ultimately becoming affirmative. This difference may stem from the fact that our provider sample excludes practices with fewer than 30 physicians. Had that data been available, the "yes" and "don't know" answers would certainly be higher. 15 September

5 Figure 4 Expected Use of ncompliant Transactions Payers Providers Do you expect to accept non-hipaacompliant transactions after 16 October 2003? 19% Don't know 21% 60% Don't know 36% 35% 29% Don't know 2% Do you expect to send non-hipaa-compliant transactions after 28% Don't know 21% 14% 16 October 2003? 70% 65% August 2003 Bottom Line: The healthcare industry cannot meet the 16 October 2003 deadline for compliance with the U.S. Health Insurance Portability and Accountability Act Administrative Simplification subtitle in its entirety. The broad progress we are seeing, however, is critical. It shows the momentum that is necessary for a transition from legacy-based exchanges early after the deadline to actual compliance. Once we get beyond the claim transaction, we can even project positive returns on the other transactions. 15 September