Review of the Final Transactions Version Update Rule

I spent some time over the weekend reviewing the details of the rule published on Friday. Congrats to CMS on getting this rule out, and on listening to industry concerns regarding timing and testing. This rule adds a new wrinkle to the implementation process, allowing entities to begin using the newly adopted standards before the compliance date if both trading partners agree. This is accomplished by adopting both the old and the new versions as standards for the period between the effective date of the rule and the compliance date for the new versions.

Let's look at the basics of the new rule, both items adopted and those not part of the final rule.




First, the X12 5010 TR3s were adopted as new HIPAA standards. CMS indicated that some changes in the TR3s were requested by some commentors (e.g. anesthesia minutes vs units). CMS suggested that these changes be taken up with X12 and the DSMOs for inclusion in the next round of updates.

NCPDP Version D.0, and the NCPDP Medicaid Subrogation Version 3.0, were adopted as standards; no technical changes were requested (Good job NCPDP).

Both the NCPDP transaction and the X12 transaction are allowed to be used for billing retail pharmacy supplies and services. Presumably, health plans will set the standard to be used for billing them, based on current practice.

Also, the suggested changes in the definitions of the transactions to specify senders and receivers were adopted. This is primarily a clarification and should not have a significant impact on operations.

Now, the compliance dates:

New compliance dates:

• Versions 5010 and D.0—January 1,

2012.

• Version 3.0 for all covered entities

except small health plans—January 1,

2012.

• Version 3.0 for small health plans—

January 1, 2013.

Pretty much as the industry requested - three years to full compliance. Now the wrinkle (quoted from the Federal Register)

"During the Level 1 and Level 2 testing

periods, either version of the standards

may be used in production mode—

Version 4010/4010A and/or Version

5010, as well as Version 5.1 and/or

Version D.0—as agreed to by trading

partners. Covered entities should be

prepared to meet Level 1 compliance by

December 31, 2010, and Level 2

compliance by December 31, 2011. After

December 31, 2011, covered entities

may not use Versions 4010/4010A and

5.1. On January 1, 2012, all covered

entities will have reached Level 2

compliance, and must be fully

compliant in using Versions 5010 and

D.0 exclusively.

While we have authorized contingency

plans in the past, we do not intend to

do so in this case, as such an action

would likely adversely impact ICD–10

implementation activities."

Very nice allowance for testing and implementation of the new versions (which are much improved over the old versions) prior to the compliance date. The preamble states that the move to the newer versions prior to the compliance date is by "trading partner agreement".

However, the exact regulatory language is:

§ 162.925 Additional requirements for
health plans.
(a) * * *
(6) During the period from March 17,
2009 through December 31, 2011, a
health plan may not delay or reject a
standard transaction, or attempt to
adversely affect the other entity or the
transaction, on the basis that it does not
comply with another adopted standard
for the same period.


Now, my friend Dr. Kepa Zubeldia of Ingenix Corp has pointed out that the regulatory language (which is binding, the preamble is not) seems to require a health plan not reject a 5010 transaction after March 17 even if they are not ready to accept it. This apparent contradiction will need to be clarified by CMS, or will require health plans to quickly have a "5010 to 4010A1" translation capability pretty quickly. It would have been better to put the trading partner clause in the regulatory language to avoid any arguments.

CMS also stated clearly that they do not intend to allow contingency plans for the version upgrades. Let's all hope the industry gets the message and meets the due date, especially since it was the due date that the industry said that they could meet.

Some other responses to comments that indicate CMS intentions or suggestions for the industry:

They recognized the value of pilot testing, and suggested that SDOs get some volunteers to do pilot testing before proposing new standards to NCVHS.

They will consider concerns about having to adopt the claims attachment standard during the version upgrade and ICD-10 implementation process. This may mean the final rule will be delayed even more, or that the compliance date will be far into the future (well after the ICD-10 compliance date of Oct 1, 2013.)

They did not adopt the X12 acknowledgment transactions as HIPAA standards, but recognized that there is no prohibition against using them to help the implementation process.

They acknowledged the need to assist Medicaid plans in meeting the compliance deadlines, and for coordination between Medicare and Medicaid.

They also acknowledged the need for comprehensive industry outreach, and their intent to work together with industry organizations to meet that need.

Not bad - for this, looks like CMS listened to the comments and responded accordingly. The industry got what they asked for. Now it is up to the industry to meet their obligations and reach compliance by the Jan 1, 2012 date.

Next post will discuss the ICD-10 final rule. That one is a little dicier - not sure CMS gave the industry all that they asked for.