A new regulation went into effect January 1st, 2012, setting industry-wide standards for electronic funds transfers in healthcare, as required by the Affordable Care Act. It will reduce up to $4.5 billion over the next 10 years in administrative costs, according to estimates published yesterday by the US. Department of Health and Human Services.
An article on Nurse.com explains:
These savings come from the adoption of electronic standards that will help eliminate inefficient manual processes and reduce costs.
The provisions will allow healthcare professionals to “spend less time filling out paperwork and more time focusing on delivering the best care for patients,” HHS Secretary Kathleen Sebelius said in a news release.
A May 2010 study in the journal Health Affairs found that physicians spend nearly 12% of every dollar they receive from patients to cover the costs of filling out forms and performing other unnecessarily complex administrative tasks. The study found that simplifying these systems could save four hours per week of professional time per physician and five hours of support staff time every week — time that could be better spent on patient care.
“As a nurse, I know the importance of giving healthcare professionals time to focus on patient care,” CMS Acting Administrator Marilyn Tavenner, RN, BSN, MHA, said in the news release. “The less time a physician has to spend on paperwork is that much more time that can be devoted to patient care. Having standardized procedures across the healthcare industry can only lead to lower costs and greater efficiencies all around.”
The rule — formally known as the Adoption of Standards for Health Care Electronic Funds Transfers and Remittance Advice — adopts streamlined standards for the format and data content of the transmission a health plan sends to its bank when it wants to pay a claim to a provider electronically (through an electronic funds transfer) and to issue a Remittance Advice notice. Remittance Advice is a notice of payment sent to providers that may or may not accompany the payment the provider receives.
For example, when a provider submits a claim electronically for payment, a health plan often sends a Remittance Advice separately from the Electronic Funds Transfers payment. The disconnect between the two makes matching up the bill and the corresponding payment difficult or sometimes impossible for the provider. The rule addresses this issue by requiring the use of a trace number that automatically matches the two. The new tracking system should allow healthcare providers to eliminate costly manual reconciliation.
Future administrative simplification rules will address adoption of a standard unique identifier for health plans and a standard for claims attachments, as well as requirements for health plans to certify compliance with all HIPAA standards and operating rules.
All health plans covered under HIPAA must comply with this regulation by Jan. 1, 2014.
I wonder a bit about the savings estimates — could they be over-optimistic? But the quotes about allowing RNs to spend more time on healthcare and less on paperwork make a lot of sense.