HIPAA Regulatory Alert

Physicians cautioned about paper claims

Reject temptation to revert to paper claims

Physician practices considering going back to paper claims as a way of coping with the Oct. 16 Centers for Medicare & Medicaid Services (CMS) deadline for transactions and code sets should resist the temptation, according to John Thomas, CEO of Dallas-based MedSynergies. MedSynergies provides business and technology services to physician practices in nine states, including taking responsibility for the complete revenue cycle.

"Some smaller practices are worried about their ability to meet the deadline," Thomas tells HIPAA Regulatory Alert. "But reverting to paper claims will be shooting yourself in the foot. It is likely to result in staff overload and increasing denials. Many payers have said they will process paper claims on a delayed basis. In the long term, the entire industry is moving to electronic transactions, and that’s the way to go."

Thomas says his company processes more than 1 million transactions a year for its clients and is committed to using the electronic format, even in the face of confusion caused by the coming Oct. 16 transaction and code sets deadline. "Someone has likened the situation to changing the propeller on an airplane during flight," he says.

Need proof claim sent and received

Thomas says that in addition to the potential for delayed processing of paper claims, there are problems in not being able to prove that a claim was sent or received. "It’s critical that practices send claims electronically and manage and review daily every rejected item that they get," he says, noting that MedSynergies has technology that is used to identify all claims that are not paid quickly so follow-up can take place.

While recognizing that some professional associations have called on CMS to define any claim in the HIPAA format as a compliant claim and take other steps to ease the potential for problems on Oct. 16, Thomas says it is his sense that payers are doing the best they can and the most important thing providers can do is recognize that the program is moving forward and work with it.

"There are a lot of benefits that ultimately will be realized from HIPAA," he asserts. "It’s requiring us to do things that we should have been doing for a long time. The benefits will far outweigh the pain of implementation. It seems like a high price to comply, but there’s also a high price for not doing this in terms of money that is lost to the practice. The industry can’t survive without greater financial discipline."

Thomas warns that efforts to delay the deadline will only prolong difficulties in claims production and says it will be more important for CMS to stick with the deadline and use enforcement to force the issue and get the work done. "The longer enforcement takes," he says, "the more we’re going to have lawsuits over clean claims. It’s going to be better to just get it over with."

[Contact John Thomas at (972) 791-1224.]