HBMA: Differing definitions of 5010 readiness plagues process

Twitter icon
Facebook icon
LinkedIn icon
e-mail icon
Google icon
The Healthcare Billing & Management Association (HBMA) has developed standard definitions for 5010 readiness for providers, software vendors, clearinghouses and health plans in response to the inconsistency of definitions found between each entity. The association shared these definitions with the Centers for Medicare & Medicaid Services (CMS) in a letter dated Oct. 10.

For nearly a decade, medical providers have been required to submit electronic medical claims using a federally approved transaction code set (TCS), according to the association. The original TCS–4010 is scheduled for a federally mandated upgrade and replacement to TCS–5010 on Jan. 1, 2012. For months, providers, health plans and others involved in the electronic claims submission industry have announced that they were ready to begin testing and/or processing transactions via the new 5010 standard. 

However, once moving into the testing phase, HBMA said it became apparent to its members that providers and health plans had “different definitions” of what it meant to be ready to submit and process 5010-compliant claims.

“Successful testing between providers and health plans is essential to a smooth transition from 4010 to 5010 and to ensure that claims are submitted and paid via electronic transactions. If providers and health plans are suddenly unable to ‘talk’ to one another via the new standards, the providers’ claims will not be properly processed or paid by the health plans—creating serious cash flow and operational problems for physicians and other health care professionals,” Holly Louie RN, co-chair of the HBMA ICD-10 Committee, which developed the standards, said in a statement.

The letter stated: “HBMA recommends the definition of ‘ready’ specifically include compliance with each published standard by the regulatory implementation date. Further, HBMA strongly recommends that payors must be restricted to limited, standardized and approved companion guides, and only when absolutely necessary.”

Under HBMA’s proposed standards, providers and clearinghouses are “5010 ready” when they have successfully completed a production submission of claims (837) and received the associated remittance (835) for those claims in compliance with the 5010 specifications. Specific tactics include:
  • Completion of all practice management system upgrades;
  • Confirmation of successful testing with direct submission carriers;
  • Confirmation of successful testing with clearinghouses where applicable;
  • Confirmation of successful production submission of claims (837); and
  • Confirmation of successful retrieval of the claims’ associated remittance (835).
By the same definitions, the association said that payors and clearinghouses are considered “5010 ready” when they have successfully accepted a production submission of claims (837) and returned the associated remittance (835) for those claims in compliance with the 5010 specifications. Specific tactics include:
  • Completion of all system upgrades;
  • Confirmation of successful testing with direct submitting providers;
  • Confirmation of successful testing with clearinghouses where applicable;
  • Confirmation of successful acceptance of production claims (837) submission; and
  • Confirmation of successful return of the claims’ associated remittance (835).
“In presenting this standard definition of 5010 readiness to CMS, our goal is to provide a definition that will be accepted across the industry as a uniform standard,” added Louie. “If all participants engaged in the transition from 4010 to 5010 agree on the meaning of ‘ready,’ the term will have more credibility and value for those communicating with each other. We hope our proposal will be favorably received by CMS. Given there are less than 50 business days before the implementation date of Jan. 1, 2012, we hope their swift action on this issue will help to limit industry confusion during this critical transition period.”

The letter to CMS can be found here.