Provider IDs promise smoother service

Federal Register contains standards

It's been a long time coming, and final implementation will be longer yet, but the Department of Health and Human Services (HHS) has officially announced that every health care provider - doctors, hospitals, nursing homes, and others - will be assigned their own unique alphanumeric provider identification number (PIN) to be used in filing future claims for reimbursement by public and private insurance programs.

The proposed rule was published in the May 7 edition of the Federal Register. Official implementation is 24 months after the final rule's effective date.

Along with these PINs, HHS also has proposed new regulations establishing a standard format for the submission of electronic claims.

"These are important steps toward a faster, simpler, less costly, and more efficient health care system," HHS secretary Donna Shalala says. "We are working with the private sector to prepare our nation for the information age in health care."

Currently, health care providers are assigned different identification numbers by private health plans, hospitals, nursing homes, and such public programs as Medicare and Medicaid.

The proposed HHS rules are part of the administrative simplification steps called for in the Health Insurance Portability and Accountability Act of 1996 (HIPAA). By greater use of electronic transactions and the elimination of inefficient paper forms, the regulations are expected to save at least $1.5 billion over the first five years of implementation, says HHS.

Under the provider ID proposal, health care providers would apply for an eight-character identifier to be used whenever processing claims electronically. Providers would apply for that identifier only once and would keep it when they move from one state to another, or if they change specialties.

Under the second proposal, every health care provider would be able to use a single standard electronic format to bill for services rendered. All health plans would be required to accept these standard electronic claims. Currently, different insurers utilize different electronic and paper claims forms, creating a confusing and cumbersome system for health care providers and taking providers' time away from their patients.

ANSI ASC X12N 837 is the electronic transmittal standard being proposed by HHS/HCFA. Meanwhile, HCFA says it plans to continue using CPT-4, ICD-9-CM, and HCPCS codes until the year 2000, at least. After that, it wants to place into service the more precise 11-digit NDC codes created by the Food and Drug Administration.

The electronic claims proposal also includes new standards for other common transactions and for reporting diagnoses and procedures in the transactions.

Health plans will be able to pay providers, authorize services, certify referrals, and coordinate benefits using one standard electronic format for each transaction. Using a standard electronic format, providers will be able to inquire about whether a patient has insurance coverage, ask about the status of a claim, or request authorizations for services or specialist referrals.

Employers who provide health insurance to employees and their dependents also will be able to use a standard electronic format to enroll or disenroll employees and to make premium payments to any health plan with which they do business.

"These efforts will help more providers move from paper to electronic transactions," says Nancy-Ann Min DeParle, administrator of HCFA, which runs the Medicare and Medicaid programs. "This will make information exchange more efficient and accurate, and result in better service for consumers."

Later this year, HHS plans to issue other administrative simplification proposals to establish national ID numbers for health plans and employers and to establish stringent new security rules to protect patient confidentiality.