HIPAA: Electronic Data Interchange (EDI) Rule: ASHA Explained

The HIPAA rules clearly expect that the response to the EDI rule will be based on the needs and resources of the provider. As long as all electronic transmissions are EDI compliant, the method of response is left up to their discretion.

Providers can submit claims directly to third party insurers if their software systems have been upgraded to comply with the EDI standards. This approach helps the provider to maintain the maximum amount of control over the claims submission and payment review process, but also necessitates the maintenance of a more sophisticated information system. The management of this direct data exchange is just one element of the claims process within the practice.

Additional operations such as scheduling, eligibility verification, coding, payment review, accounts receivables, re-submissions and others should all be well integrated with the mechanics of data exchange and managed through one of the many HIPAA-compliant office management software packages. While there are many advantages to automating the exchange of claim information directly with the payer, it also requires an additional degree of integration into the overall office management process to assure the highest possible level of accuracy. Establishment of these operational processes and the training needed to integrate the automated system with office management procedures can sometimes be facilitated with the help of a consultant.

If an intermediary such as a clearinghouse is used to help reformat claims to conform to the HIPAA standard, much of the compliance with HIPAA’s EDI rules will be met by that entity. Although the process of initially submitting the claim to the intermediary and the analysis of payments remain under the control of the provider, the mechanical process of reformatting the claim information is performed elsewhere. It is, therefore, possible to maintain a slightly less technical level of automation while benefiting from the electronic submission to the insurer, which has been facilitated by the intermediary.

This option will not necessarily require the help of a consultant, but will likely require assistance from the intermediary to establish the connection and implement the initial exchange. However, as in the office management functions identified above, the greater the degree of office function integration, the better the level of overall control of the claims processes and revenue collection.