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Concerns Mount As HIPAA Deadline Looms September 2, 2003 -In an environment reminiscent of Y2K, health care providers, payors and related service companies are increasingly concerned over what will happen to their cash flow after the Health Insurance Portability and Accountability Act (HIPAA) deadline of October 16, 2003. It now appears that many payors will not be prepared to accept standard HIPAA transactions by the deadline. And many of those who say that they will, are unable or unwilling to perform appropriate testing. Even when they are willing to pre-test, many payors are overwhelmed with requests for testing and they simply do not have the resources to manage the volume of testing required by the deadline. So there is no way of knowing prior to October 16 whether submissions to these payors will, in fact, be accepted. Our software vendor, PPM Information Systems (PPM), has already made all of the changes to their software to submit HIPAA compliant claims. They have also been working diligently with the payors to secure HIPAA certification. As of September 1, 2003, we have received preliminary approval from Blue Cross Blue Shield of Michigan (BCBSM), Medicare and Medicaid on our 837 Claims transactions. PPM has a few more steps to complete before receiving final approval and they expect to be complete on schedule. However, as you might imagine, the process of obtaining approval from a number of smaller payors through the Envoy Clearinghouse is a much more complex task. PPM is working through these challenges. Success is largely in the hands of the payors and many of them are simply going to miss the deadline. So, what happens if a payor is unable to handle HIPAA transactions after the deadline? South Oakland Services (SOS) is developing contingency plans to deal with this eventuality. We are talking to each of the payors to determine their HIPAA readiness. If they will not be ready, we are working with them to determine how we will be able to continue submitting claims. In some cases this may mean submitting paper claims until they are HIPAA compliant. In other cases, it may mean submitting electronic claims in legacy format. Each of these approaches will vary by payor. It is important to understand that while SOS will be HIPAA compliant on October 16, many payors may not be and this could cause some disruption in your cash flow. You may wish to develop a contingency plan that will accommodate short-term cash flow fluctuations. The Medical Group Management Association (MGMA) has recommended the following: “… Postpone any major capital investments and keep some cash reserves handy…Establish a line of credit in case you need it to pay your bills.” As always, South Oakland Services will do everything in our power to assure you of uninterrupted cash flow and will continue to work with the payors on contingency planning and compliance. Meanwhile, we will update you again later this month on payors progress toward HIPAA readiness. |
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