Headline News in Healthcare is About Cost, Paperwork Reduction Rules Expected

Headline news in health care is usually about cost.  Now, we expect that by 2013 the entire industry will be required to provide quicker answers with less paperwork.   New rules that will help determine whether a patient can receive services from a health care provider according to their health plan, and the status of associated claims for those services are expected by 2013 if a new rule is finalized.

Last year we published a whitepaper noting that we expected gradual adoption of CAQH CORE rules with higher standards for determining patient eligibility and claim status via electronic systems.  In fact, complete eligibility information at the point of care, we predicted, would not be far off.

Headline news in the health care industry is finally arriving. July 30, 2011 the U.S. Department of Health and Human Services (HHS) published an interim final rule, which adopts operating principles developed by the Council for Affordable and Quality Healthcare’s Committee on Operating Rules for Information Exchange (CAQH CORE).

This is a first step toward implementation of an Affordable Care Act provision that cuts red tape in the health care system.   HHS estimates this will save $12 billion over ten years.

  • Whether a patient is eligible for coverage
  • The status of a health care claim submitted to a health insurer

The interim final rule issued requires compliance by health plans, health care clearinghouses, and certain health care providers by January 1, 2013.

The rule is the first of many that are expected, focused improvements to the health care system. Future rules, which will likely make headline news in healthcare, will address adoption of:

  • Electronic funds transfer and remittance advice;
  • A unique identifier for health plans;
  • A standard for health care claims attachments; and
  • Requirements that health plans certify compliance with all HIPAA standards and operating rules

The Office of the Federal Register posts rules for public inspection at this link: http://www.ofr.gov/inspection.aspx#special. The rule is set for publication on July 8, 2011. Comments will be accepted if submitted by 5:00 p.m. EDT September 6, 2011.

Expect revisions and extensions to HIPAA 5010, the new EDI standard to deal with this in the future.  Also, as ICD-10 CM becomes updated starting in 2014 there may be updates to diagnosis and procedure codes that support greater efficiencies.

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Michael F. Arrigo

Michael Arrigo, an expert witness, and healthcare executive, brings four decades of experience in the software, financial services, and healthcare industries. In 2000, Mr. Arrigo founded No World Borders, a healthcare data, regulations, and economics firm with clients in the pharmaceutical, medical device, hospital, surgical center, physician group, diagnostic imaging, genetic testing, health I.T., and health insurance markets. His expertise spans the federal health programs Medicare and Medicaid and private insurance. He advises Medicare Advantage Organizations that provide health insurance under Part C of the Medicare Act. Mr. Arrigo serves as an expert witness regarding medical coding and billing, fraud damages, and electronic health record software for the U.S. Department of Justice. He has valued well over $1 billion in medical billings in personal injury liens, malpractice, and insurance fraud cases. The U.S. Court of Appeals considered Mr. Arrigo's opinion regarding loss amounts, vacating, and remanding sentencing in a fraud case. Mr. Arrigo provides expertise in the Medicare Secondary Payer Act, Medicare LCDs, anti-trust litigation, medical intellectual property and trade secrets, HIPAA privacy, health care electronic claim data Standards, physician compensation, Anti-Kickback Statute, Stark law, the Affordable Care Act, False Claims Act, and the ARRA HITECH Act. Arrigo advises investors on merger and acquisition (M&A) diligence in the healthcare industry on transactions cumulatively valued at over $1 billion. Mr. Arrigo spent over ten years in Silicon Valley software firms in roles from Product Manager to CEO. He was product manager for a leading-edge database technology joint venture that became commercialized as Microsoft SQL Server, Vice President of Marketing for a software company when it grew from under $2 million in revenue to a $50 million acquisition by a company now merged into Cincom Systems, hired by private equity investors to serve as Vice President of Marketing for a secure email software company until its acquisition and multi $million investor exit by a company now merged into Axway Software S.A. (Euronext: AXW.PA), and CEO of one of the first cloud-based billing software companies, licensing its technology to Citrix Systems (NASDAQ: CTXS). Later, before entering the healthcare industry, he joined Fortune 500 company Fidelity National Financial (NYSE: FNF) as a Vice President, overseeing eCommerce solutions for the mortgage banking industry. While serving as a Vice President at Fortune 500 company First American Financial (NYSE: FAF), he oversaw eCommerce and regulatory compliance technology initiatives for the top ten mortgage banks and led the Sarbanes Oxley Act Section 302 internal controls I.T. audit for the company, supporting Section 404 of the Sarbanes Oxley Act. Mr. Arrigo earned his Bachelor of Science in Business Administration from the University of Southern California. Before that, he studied computer science, statistics, and economics at the University of California, Irvine. His post-graduate studies include biomedical ethics at Harvard Medical School, biomedical informatics at Stanford Medical School, blockchain and crypto-economics at the Massachusetts Institute of Technology, and training as a Certified Professional Medical Auditor (CPMA). Mr. Arrigo is qualified to serve as a director due to his experience in healthcare data, regulations, and economics, his leadership roles in software and financial services public companies, and his healthcare M&A diligence and public company regulatory experience. Mr. Arrigo is quoted in The Wall Street Journal, Fortune Magazine, Kaiser Health News, Consumer Affairs, National Public Radio (NPR), NBC News Houston, USA Today / Milwaukee Journal Sentinel, Medical Economics, Capitol ForumThe Daily Beast, the Lund Report, Inside Higher Ed, New England Psychologist, and other press and media outlets. He authored a peer-reviewed article regarding clinical documentation quality to support accurate medical coding, billing, and good patient care, published by Healthcare Financial Management Association (HFMA) and published in Healthcare I.T. News. Mr. Arrigo serves as a member of the board of directors of a publicly traded company in the healthcare and data analytics industry, where his duties include: member, audit committee; chair, compensation committee; member, special committee.

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