Why HIPAA 5010 Upgrade

HIPAA requires to adopt standards that covered entities required to use in electronically conducting certain health care administrative transactions, such as claims, remittance, eligibility, and claims status requests and responses. Covered entities include health plans, health care clearinghouses, and health care providers.

The current transaction standard is X12 version 4010A1 for health care claims, remittance advice, eligibility, claims status, referrals, and NCPDP version 3.0 for pharmacy claims. The Centers for Medicare & Medicaid Services (CMS) is proposing that the industry upgrade to X12 version 5010.

Why Consider 5010

• Significant transaction improvements in 5010
• Added, improved, or remove both business functions and content
• More clarity in provider loops
• Support for ICD-10 was added in 5010
• Clarifies NPI instructions in 5010

Challenge of 5010

After the deadline (currently proposed as January 1, 2012), Medicare, Medicaid, and other health plans will not accept electronic transactions that are not in the 5010 format.

• Increase the labor resources that providers must expend to rework and resend the transaction.
• Transaction submission delays will delay reimbursement and impact cash flow.

Some commercial payers are likely to continue to accept the 4010A1 version for some time following the implementation date. However, these accommodations will not last long, since they put payers at risk of being penalized for non-compliance.

Benefits of 5010

• Implementation of improvements deemed needed, following the adoption and use of the 4010A1 messages.
• Clarification of NPI instructions
• Better consistency of data flow across the various implementation guides
• Reduced the use of proprietary companion codes
• Enhanced industry consensus on critical transactions

Related Links

CMS – HIPAA