CORBAmed January 12, 1999

1. Administrative Simplification CORBAmedJanuary 12, 1999 Bill Braithwaite Senior Advisor on Health Information Policy U.S. Department of Health and Human Services

2. Administrative Simplification Law Title II - Subtitle F of H.R. 3103(the Kassebaum/Kennedy Bill) “The Health Insurance Portability and Accountability Act of 1996” AKA “HIPAA” Signed August 21, 1996 to become P.L. 104-191 Part C of Title XI of the Social Security Act

3. Purpose of Provisions • Improve the efficiency and effectiveness of the health care system by standardizing the electronic data interchange of certain administrative and financial transactions. • Protect the security and privacy of transmitted information. $

5. Overview of Provisions • HHS must adopt national standards necessary for efficient, electronic, administrative and financial health care transactions. • All health plans, all clearinghouses, and those providers who choose to conduct these transactions electronically, are required to implement these standards. • Recommendations for privacy legislation. • Recommendations for electronic medical records.

6. Mandated Standards • 9 EDI transaction standards (claims, encounters, enrollment, etc.) including code sets. • Coordination of benefits information. • Unique identifiers (including allowed uses) for individuals, employers, health plans, and health care providers. • Security, confidentiality, and electronic signatures.

7. Standards Adoption Process • HHS looks to industry for consensus standard: • developed by ANSI accredited standards setting organization (SDO). • HHS works with industry to develop and confirm consensus at implementation guide level. • Secretary relies on recommendations of the NCVHS, which holds public meetings and hearings as required to get public input. • HHS publishes proposed rules and then final rules which have the force of federal law.

8. Satisfaction of Requirements • Directly transmitting and receiving data using adopted standards • Submitting non-standard data to a health care clearinghouse for transmission using adopted standards. • Receiving non-standard data from a health care clearinghouse after conversion from data received using adopted standards.

9. Penalties • Penalty for Non-compliance with Standards: • $100 each violation; maximum $25,000 per year per violation of identical requirement or prohibition. • Penalty for Wrongful Disclosure: • Maximum $250,000 and 10 years imprisonment.

10. Publications in 1998 • Federal Register - Notices of Proposed Rule Making (NPRMs) and their public comment periods: • Transactions and Medical Coding (5/7/98 - 7/6/98) • National Provider ID (5/7/98 - 7/6/98) • Employer ID (6/16/98 - 8/17/98) • Security (8/12/98 - 10/13/98)

11. Expected 1999 Publications • Final rules for transactions, security, provider identifier, and employer identifier. • NPRM for Health Plan Identifier • NPRM for Claims Attachment • NPRM for First Report of Injury • Possible standard for Health Number for Individuals?

12. Expected 2000 Publications • Standards for Privacy of Individually Identifiable Health Information (whether or not Congress passes privacy law by August 1999). • NCVHS Recommendations for standards for patient medical record information and the electronic exchange of such information. • Possible other financial and administrative transactions that improve the operation of the health care system and reduce administrative costs.

13. Criteria for Standards • Improve efficiency and effectiveness • by leading to cost reductions for or improvements in benefits from electronic health care transactions. • Meet needs of user community • Data element definitions and codes consistent and uniform with other standards. • Low development and implementation costs relative to benefits of using the standard. • Supported by ANSI-accredited SDO or other organization to ensure continuity and updating.

14. Criteria for Standards • Timely development, testing, implementation, and updating procedures. • Technologically independent of computer platforms and transmission protocols, except when explicitly part of the standard. • Precise and unambiguous, but simple as possible. • Low data collection and paperwork burdens. • Flexibility to adapt to changes in infrastructure.

15. New Technology • Proposed process to introduce new technology: • Request waiver for testing showing • clear improvement over the current standard. • cost-benefit analysis. • Test new standard or revision of current standard. • Report on test results. • HHS will adopt new or revised standard if • benefits of the proposed revision or new standard significantly outweigh the disadvantages of implementing it.

16. Philosophy • One standard for the data (definitions + conditions) • Potential for multiple transport standards • Open standards (over proprietary) • Due process for consideration of all input (ANSI) • Standards at implementation guide level • Consider cost of supporting multiple standards • Limit transition requirements as standards evolve

17. Resources • Web Sites: • http://aspe.os.dhhs.gov/admnsimp/ • posting of law, process, regulations, and comments. • http://www.wpc-edi.com/hipaa/ • posting of X12N implementation guides • Listserv: • receive e-mail notification on publication of documents related to HIPAA regulations • send e-mail to: listserv@list.nih.gov • include in body of message: subscribe HIPAA-REGS first-name last-name