25272 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

DEPARTMENT OF HEALTH AND

HUMAN SERVICES

Office of the Secretary

45 CFR Part 142

[HCFA–0149–P]

RIN 0938–AI58

Health Insurance Reform: Standards

for Electronic Transactions

AGENCY: Health Care Financing

Administration (HCFA), HHS.

ACTION: Proposed rule.

SUMMARY: This rule proposes standards

for eight electronic transactions and for

code sets to be used in those

transactions. It also proposes

requirements concerning the use of

these standards by health plans, health

care clearinghouses, and health care

providers.

The use of these standard transactions

and code sets would improve the

Medicare and Medicaid programs and

other Federal health programs and

private health programs, and the

effectiveness and efficiency of the

health care industry in general, by

simplifying the administration of the

system and enabling the efficient

electronic transmission of certain health

information. It would implement some

of the requirements of Administrative

Simplification subtitle of the Health

Insurance Portability and

Accountability Act of 1996.

DATES: Comments will be considered if

we receive them at the appropriate

address, as provided below, no later

than 5 p.m. on July 6, 1998.

ADDRESSES: Mail written comments (1

original and 3 copies) to the following

address:

Health Care Financing Administration,

U.S. Department of Health and

Human Services, Attention: HCFA–

0149–P, P.O. Box 31850, Baltimore,

MD 21207–8850.

If you prefer, you may deliver your

written comments (1 original and 3

copies) to one of the following

addresses:

Room 309–G, Hubert H. Humphrey

Building, 200 Independence Avenue,

SW., Washington, DC 20201,

or

Room C5–09–26, 7500 Security

Boulevard, Baltimore, MD 21244–

1850.

Comments may also be submitted

electronically to the following e-mail

address: transact@osaspe.dhhs.gov. Email comments should include the full

name and address of the sender and

must be submitted to the referenced

address to be considered. All comments

should be incorporated in the e-mail

message because we may not be able to

access attachments. Electronically

submitted comments will be available

for public inspection at the

Independence Avenue address below.

Because of staffing and resource

limitations, we cannot accept comments

by facsimile (FAX) transmission. In

commenting, please refer to file code

HCFA–0149–P and the specific section

of this proposed rule. Comments

received timely will be available for

public inspection as they are received,

generally beginning approximately 3

weeks after publication of a document,

in Room 309–G of the Department’s

offices at 200 Independence Avenue,

SW., Washington, DC, on Monday

through Friday of each week from 8:30

a.m. to 5 p.m. (phone: (202) 690–7890).

Electronic and legible written comments

will also be posted, along with this

proposed rule, at the following web site:

http://aspe.os.dhhs.gov/admnsimp.

Copies: To order copies of the Federal

Register containing this document, send

your request to: New Orders,

Superintendent of Documents, P.O. Box

371954, Pittsburgh, PA 15250–7954.

Specify the date of the issue requested

and enclose a check or money order

payable to the Superintendent of

Documents, or enclose your Visa or

Master Card number and expiration

date. Credit card orders can also be

placed by calling the order desk at (202)

512–1800 or by faxing to (202) 512–

2250. The cost for each copy is $8. As

an alternative, you can view and

photocopy the Federal Register

document at most libraries designated

as Federal Depository Libraries and at

many other public and academic

libraries throughout the country that

receive the Federal Register.

This Federal Register document is

also available from the Federal Register

online database through GPO Access, a

service of the U.S. Government Printing

Office. Free public access is available on

a Wide Area Information Server (WAIS)

through the Internet and via

asynchronous dial-in. Internet users can

access the database by using the World

Wide Web; the Superintendent of

Documents home page address is

http://www.access.gpo.gov/suldocs/,

by using local WAIS client software, or

by telnet to swais.access.gpo.gov, then

login as guest (no password required).

Dial-in users should use

communications software and modem

to call 202–512–1661; type swais, then

login as guest (no password required).

FOR FURTHER INFORMATION CONTACT:

Pat Brooks, (410) 786–5318, for medical

diagnosis, procedure, and clinical

code sets.

Joy Glass, (410) 786–6125, for the

following transactions: Health claims

or equivalent encounter information;

health care payment and remittance

advice; coordination of benefits; and

health care claim status.

Marilyn Abramovitz, (410) 786–5939,

for the following transactions:

Enrollment and disenrollment in a

health plan; eligibility for a health

plan; health plan premium payments;

and referral certification and

authorization.

SUPPLEMENTARY INFORMATION:

I. Background

[Please label written or e-mailed comments

about this section with the subject:

Background]

Electronic data interchange (EDI) is

the electronic transfer of information,

such as electronic media health care

claims, in a standard format between

trading partners. EDI allows entities

within the health care system to

exchange medical, billing, and other

information and process transactions in

a manner which is fast and cost

effective. With EDI there is a substantial

reduction in handling and process time,

and the risk of lost paper documents is

eliminated. EDI can eliminate the

inefficiencies of handling paper

documents, which will significantly

reduce the administrative burden, lower

operating costs and improve overall data

quality.

The health care industry recognizes

the benefits of EDI and many entities in

that industry have developed

proprietary EDI formats. Currently, there

are about 400 formats for electronic

health care claims being used in the

United States. The lack of

standardization makes it difficult to

develop software, and the efficiencies

and savings for health care providers

and health plans that could be realized

if formats were standardized are

diminished.

Adopting national standard EDI

formats for health care transactions

would greatly decrease the burden on

health care providers and their billing

services, as would standardized data

content. Standard EDI format allows

data interchange using a common

interchange structure, thus eliminating

the need for users to reprogram their

data processing systems for multiple

formats. Standardization of the data

content within the interchange structure

involves: (1) Uniform definitions of the

data elements that will be exchanged in

each type of electronic transaction, and
Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules 25273

(2) for some data elements,

identification of the specific codes or

values that are valid for each data

element. The code sets needed for EDI

in the health care industry include large

coding and classification systems for

medical diagnoses, procedures, and

drugs, as well as smaller sets of codes

for such items as types of facility, types

of currency, types of units, and

specified State within the United States.

Standardized data content is essential to

accurate and efficient EDI between the

many producers and users of

administrative health data transactions.

A. Legislation

The Congress included provisions to

address the need for electronic

transactions and other administrative

simplification issues in the Health

Insurance Portability and

Accountability Act of 1996 (HIPAA),

Public Law 104–191, which was enacted

on August 21, 1996. Through subtitle F

of title II of that law, the Congress added

to title XI of the Social Security Act a

new part C, entitled ‘‘Administrative

Simplification.’’ (Public Law 104–191

affects several titles in the United States

Code. Hereafter, we refer to the Social

Security Act as the Act; we refer to the

other laws cited in this document by

their names.) The purpose of this part is

to improve the Medicare and Medicaid

programs in particular and the

efficiency and effectiveness of the

health care system in general by

encouraging the development of a

health information system through the

establishment of standards and

requirements to facilitate the electronic

transmission of certain health

information.

Part C of title XI consists of sections

1171 through 1179 of the Act. These

sections define various terms and

impose several requirements on HHS,

health plans, health care clearinghouses,

and certain health care providers

concerning the electronic transmission

of health information.

The first section, section 1171 of the

Act, establishes definitions for purposes

of part C of title XI for the following

terms: code set, health care

clearinghouse, health care provider,

health information, health plan,

individually identifiable health

information, standard, and standard

setting organization.

Section 1172 of the Act makes any

standard adopted under part C

applicable to (1) all health plans, (2) all

health care clearinghouses, and (3) any

health care providers that transmit any

health information in electronic form in

connection with transactions referred to

in section 1173(a)(1) of the Act.

This section also contains

requirements concerning standard

setting.

• The Secretary may adopt a standard

developed, adopted, or modified by a

standard setting organization (that is, an

organization accredited by the American

National Standards Institute (ANSI))

that has consulted with the National

Uniform Billing Committee (NUBC), the

National Uniform Claim Committee

(NUCC), the Workgroup for Electronic

Data Interchange (WEDI), and the

American Dental Association (ADA).

• The Secretary may also adopt a

standard other than one established by

a standard setting organization, if the

different standard will reduce costs for

health care providers and health plans,

the different standard is promulgated

through negotiated rulemaking

procedures, and the Secretary consults

with each of the above-named groups.

• If no standard has been adopted by

any standard setting organization, the

Secretary is to rely on the

recommendations of the National

Committee on Vital and Health

Statistics (NCVHS) and consult with the

above-named groups.

In complying with the requirements

of part C of title XI, the Secretary must

rely on the recommendations of the

NCVHS, consult with appropriate State,

Federal, and private agencies or

organizations, and publish the

recommendations of the NCVHS in the

Federal Register.

Paragraph (a) of section 1173 of the

Act requires that the Secretary adopt

standards for financial and

administrative transactions, and data

elements for those transactions, to

enable health information to be

exchanged electronically. Standards are

required for the following transactions:

health claims, health encounter

information, health claims attachments,

health plan enrollments and

disenrollments, health plan eligibility,

health care payment and remittance

advice, health plan premium payments,

first report of injury, health claim status,

and referral certification and

authorization. In addition, the Secretary

is required to adopt standards for any

other financial and administrative

transactions that are determined to be

appropriate by the Secretary.

Paragraph (b) of section 1173 of the

Act requires the Secretary to adopt

standards for unique health identifiers

for all individuals, employers, health

plans, and health care providers and

requires further that the adopted

standards specify for what purposes

unique health identifiers may be used.

Paragraphs (c) through (f) of section

1173 of the Act require the Secretary to

establish standards for code sets for

each data element for each health care

transaction listed above, security

standards for health care information

systems, standards for electronic

signatures (established together with the

Secretary of Commerce), and standards

for the transmission of data elements

needed for the coordination of benefits

and sequential processing of claims.

Compliance with electronic signature

standards will be deemed to satisfy both

State and Federal requirements for

written signatures with respect to the

transactions listed in paragraph (a) of

section 1173 of the Act.

In section 1174 of the Act, the

Secretary is required to adopt standards

for all of the above transactions, except

claims attachments, within 24 months

after enactment. The standards for

claims attachments must be adopted

within 30 months after enactment.

Generally, after a standard is established

it cannot be changed during the first

year except for changes that are

necessary to permit compliance with the

standard. Modifications to any of these

standards may be made after the first

year, but not more frequently than once

every 12 months. The Secretary must

also ensure that procedures exist for the

routine maintenance, testing,

enhancement, and expansion of code

sets and that there are crosswalks from

prior versions.

Section 1175 of the Act prohibits

health plans from refusing to process or

delaying the processing of a transaction

that is presented in standard format.

The Act’s requirements are not limited

to health plans, however; instead, each

person to whom a standard or

implementation specification applies is

required to comply with the standard

within 24 months (or 36 months for

small health plans) of its adoption. A

plan or person may, of course, comply

voluntarily before the effective date. A

person may comply by using a health

care clearinghouse to transmit or receive

the standard transactions. Compliance

with modifications to standards or

implementation specifications must be

accomplished by a date designated by

the Secretary. This date may not be

earlier than 180 days after the notice of

change.

Section 1176 of the Act establishes a

civil monetary penalty for violation of

the provisions in part C of title XI of the

Act, subject to several limitations.

Penalties may not be more than $100

per person per violation and not more

than $25,000 per person per violation of

a single standard for a calendar year.

The procedural provisions in section

1128A of the Act, ‘‘Civil Monetary

Penalties,’’ are applicable.
25274 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

Section 1177 of the Act establishes

penalties for a knowing misuse of

unique health identifiers and

individually identifiable health

information: (1) A fine of not more than

$50,000 and/or imprisonment of not

more than 1 year; (2) if misuse is ‘‘under

false pretenses,’’ a fine of not more than

$100,000 and/or imprisonment of not

more than 5 years; and (3) if misuse is

with intent to sell, transfer, or use

individually identifiable health

information for commercial advantage,

personal gain, or malicious harm, a fine

of not more than $250,000 and/or

imprisonment of not more than 10

years.

Under section 1178 of the Act, the

provisions of part C of title XI of the

Act, as well as any standards

established under them, supersede any

State law that is contrary to them.

However, the Secretary may, for

statutorily specified reasons, waive this

provision.

Finally, section 1179 of the Act makes

the above provisions inapplicable to

financial institutions or anyone acting

on behalf of a financial institution when

‘‘authorizing, processing, clearing,

settling, billing, transferring,

reconciling, or collecting payments for a

financial institution’’.

(Concerning this last provision, the

conference report, in its discussion on

section 1178, states:

‘‘The conferees do not intend to exclude

the activities of financial institutions or their

contractors from compliance with the

standards adopted under this part if such

activities would be subject to this part.

However, conferees intend that this part does

not apply to use or disclosure of information

when an individual utilizes a payment

system to make a payment for, or related to,

health plan premiums or health care. For

example, the exchange of information

between participants in a credit card system

in connection with processing a credit card

payment for health care would not be

covered by this part. Similarly sending a

checking account statement to an account

holder who uses a credit or debit card to pay

for health care services, would not be

covered by this part. However, this part does

apply if a company clears health care claims,

the health care claims activities remain

subject to the requirements of this part.’’)

(H.R. Rep. No. 736, 104th Cong., 2nd Sess.

268–269 (1996))

B. Process for Developing National

Standards

The Secretary has formulated a 5-part

strategy for developing and

implementing the standards mandated

under part C of title XI of the Act:

1. To ensure necessary interagency

coordination and required interaction

with other Federal departments and the

private sector, establish

interdepartmental implementation

teams to identify and assess potential

standards for adoption. The subject

matter of the teams includes claims/

encounters, identifiers, enrollment/

eligibility, systems security, and

medical coding/classification. Another

team addresses cross-cutting issues and

coordinates the subject matter teams.

The teams consult with external groups

such as the NCVHS’’ Workgroup on

Data Standards, WEDI, ANSI’s

Healthcare Informatics Standards Board

(HISB), the NUCC, the NUBC, and the

ADA. The teams are charged with

developing regulations and other

necessary documents and making

recommendations for the various

standards to the HHS’’ Data Council

through its Committee on Health Data

Standards. (The HHS Data Council is

the focal point for consideration of data

policy issues. It reports directly to the

Secretary and advises the Secretary on

data standards and privacy issues.)

2. Develop recommendations for

standards to be adopted.

3. Publish proposed rules in the

Federal Register describing the

standards. Each proposed rule provides

the public with a 60-day comment

period.

4. Analyze public comments and

publish the final rules in the Federal

Register.

5. Distribute standards and coordinate

preparation and distribution of

implementation guides.

This strategy affords many

opportunities for involvement of

interested and affected parties in

standards development and adoption by

enabling them to:

• Participate with standards setting

organizations.

• Provide written input to the

NCVHS.

• Provide written input to the

Secretary of the HHS.

• Provide testimony at NCVHS’

public meetings.

• Comment on the proposed rules for

each of the proposed standards.

• Invite HHS staff to meetings with

public and private sector organizations

or meet directly with senior HHS staff

involved in the implementation process.

The implementation teams charged

with reviewing standards for

designation as required national

standards under the statute have

defined, with significant input from the

health care industry, a set of principles

for guiding choices for the standards to

be adopted by the Secretary. These

principles are based on direct

specifications in HIPAA and the

purpose of the law, principles that

support the regulatory philosophy set

forth in Executive Order 12866 and the

Paperwork Reduction Act of 1995. To be

designated as an HIPAA standard, each

standard should:

1. Improve the efficiency and

effectiveness of the health care system

by leading to cost reductions for or

improvements in benefits from

electronic health care transactions.

2. Meet the needs of the health data

standards user community, particularly

health care providers, health plans, and

health care clearinghouses.

3. Be consistent and uniform with the

other HIPAA standards—their data

element definitions and codes and their

privacy and security requirements—

and, secondarily, with other private and

public sector health data standards.

4. Have low additional development

and implementation costs relative to the

benefits of using the standard.

5. Be supported by an ANSIaccredited standards developing

organization or other private or public

organization that will ensure continuity

and efficient updating of the standard

over time.

6. Have timely development, testing,

implementation, and updating

procedures to achieve administrative

simplification benefits faster.

7. Be technologically independent of

the computer platforms and

transmission protocols used in

electronic health transactions, except

when they are explicitly part of the

standard.

8. Be precise and unambiguous, but as

simple as possible.

9. Keep data collection and

paperwork burdens on users as low as

is feasible.

10. Incorporate flexibility to adapt

more easily to changes in the health care

infrastructure (such as new services,

organizations, and provider types) and

information technology.

A master data dictionary providing for

common data definitions across the

standards selected for implementation

under HIPAA will be developed and

maintained. We intend for the data

element definitions to be precise,

unambiguous, and consistently applied.

The transaction-specific reports and

general reports from the master data

dictionary will be readily available to

the public. At a minimum, the

information presented will include data

element names, definitions, and

appropriate references to the

transactions where they are used.

C. ANSI-Accredited Standards

Committee Standard Setting Process

ANSI chartered the X12 Accredited

Standards Committee (ASC) a number of

years ago to design national electronic
Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules 25275

standards for a wide range of business

applications. A separate ASC X12N

Subcommittee was in turn chartered to

develop electronic standards specific to

the insurance industry, including health

care insurance. Volunteer members of

the ASC X12N Subcommittee, including

health care providers, health plans,

bankers, and vendors involved in

software development/billing/

transmission of health care data and

other business aspects of health care

administrative activities, worked to

develop standards for electronic health

care transactions. ANSI accredits

standards setting organizations to

ensure that the procedures used meet

certain due process requirements and

that the process is voluntary, open, and

based on obtaining consensus. Both

Accredited Standards Committee (ASC)

X12 and the National Council for

Prescription Drug Programs (NCPDP) are

ANSI-accredited standards developers.

Each of the two standards setting

organizations has written procedures for

the establishment of, and revisions to,

established standards. All of the X12

Subcommittee N: Insurance (to which

we refer hereafter as X12N) standard

implementations mentioned in this

regulation are ASC X12 standards and

are published under the designation

‘‘Draft Standard for Trial Use (DSTU)’’.

These standards are fully accepted and

published national standards for use in

electronic data exchanges. The DSTU

designation is used to distinguish ASC

X12 standards from those standards that

have been forwarded to the American

National Standards Institute for

acceptance as American National

Standards. ASC X12 creates a family of

standards that are related and therefore

only forwards standards to ANSI every

five years. Although the official

designation of X12 standards includes

the word ‘‘Draft’’, these standards are

final, published national standards.

The ASC X12 development process

involves negotiation and consensus

building, resulting in approval and

publication of DSTU and American

National Standards. The ASC X12

committee maintains current standards,

proposes new standards and embraces

new ideas.

The ASC X12N Subcommittee is the

decision-making body responsible for

obtaining consensus, which is necessary

for approval of American National

Standards in the field of insurance. The

ASC X12N Subcommittee has the

responsibility for specific standards

development and standards

maintenance activities, but its work

must be ratified by the membership of

ASC X12 as a whole.

Members of the ASC X12 committee

are eligible to vote on ASC X12N issues.

ASC X12N votes technical issues by

letter ballot. Administrative issues may

be voted by letter ballot or at general

sessions during ASC X12N meetings.

The NCPDP Telecommunication

Standard 3.2 specifies the rules

regarding the creation of a new version

and release. The NCPDP standards

development process involves additions

of new data elements or additional

values to existing data elements.

Updated documentation of existing or

new data elements and a new version is

created with changes to: (1) The

definition of an existing data element,

(2) deletions of values of an existing

data element, (3) deletions of existing

data elements, (4) major structural

changes to the formats, (5) changes in

the size of data elements, or (6) changes

in the formats of data elements.

These rules were confirmed by the

Board of Trustees in June, 1995 and

ensure that the health plan explicitly

knows which Data Dictionary to apply

to the transaction when processing the

claim. Likewise, the pharmacy needs to

know what are the acceptable fields in

the response returned from the health

plan.

In addition, the Telecommunication

Standard Format Version/Release

changes anytime there is an approved

change to the Professional Pharmacy

Services (PPS) standard, Drug

Utilization Review (DUR) standard,

Billing Unit standard or to the data

elements for the claim itself.

All NCPDP implementation guides

must be reviewed and approved by the

Maintenance and Control Work Group

prior to release to the membership. All

proposed standards will have an

implementation guide developed and

approved prior to the proposed standard

being balloted. Once balloted, the

originating committee may work with

individual disapproval votes to

accommodate their concerns and

convert their votes to approval. If the

changes made to accommodate

disapproval votes are considered

substantial, then the item under

consideration must be balloted again.

After the originating group has

reviewed all comments received during

the letter ballot period, the Co-Chairs of

the originating group make a written

request to the Board of Trustees for the

ballot results collected from the

Standardization Co-chairs and the Board

of Directors. The Board of Trustees

retains final authority over the

certification of these ballot results.

Two types of code sets are required

for data elements in ASC X12N and

NCPDP health transaction standards: (1)

Large coding and classification systems

for medical data elements (for example,

diagnoses, procedures, and drugs), and

(2) smaller sets of codes for data

elements such as type of facility, type of

units, and specified State within

address fields. Federal agencies (NCHS,

HCFA, FDA) and some private

organizations (the AMA and the ADA)

have developed and maintained

standards for large medical data code

sets. In the past, these code sets have

been mandated for use in some Federal

and State programs, such as Medicare

and Medicaid, and the ASC X12N and

NCPDP standards setting organizations

have adopted these code sets for use in

their standards. For the smaller sets of

codes needed for various transaction

data elements they have designated

other de facto standards, such as the 2-

character state abbreviations used by the

U.S. Postal Service, or developed code

sets specifically for their transaction

standards.

This proposed rule would establish

the standards for code sets to be used in

seven of the transactions specified in

section 1173(a)(2) of the Act, and for a

transaction for coordination of benefits.

We anticipate publishing several

regulations documents altogether to

promulgate the various standards

required under the HIPAA. The other

proposed regulations cover security

standards, the seventh and ninth

transactions specified in the Act (first

report of injury and claims

attachments), and the four identifiers.

II. Provisions of the Proposed

Regulations

[Please label written comments or e-mailed

comments about this section with the subject:

Provisions]

In this proposed rule, we propose

standards for eight transactions and for

code sets to be used in the transactions.

We also propose requirements

concerning the implementation of these

standards. This proposed rule would set

forth requirements that health plans,

health care clearinghouses, and certain

health care providers would have to

meet concerning the use of these

standards.

We propose to add a new part to title

45 of the Code of Federal Regulations

for health plans, health care providers,

and health care clearinghouses in

general. The new part would be part 142

of title 45 and would be titled

‘‘Administrative Requirements.’’

Subparts J through R would contain the

provisions specifically concerning the

standards proposed in this rule.
25276 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

A. Applicability

Section 262 of HIPAA applies to all

health plans, all health care

clearinghouses, and any health care

providers that transmit any health

information in electronic form in

connection with transactions referred to

in section 1173(a)(1) of the Act. Our

proposed rules (at 45 CFR 142.102)

would apply to the health plans and

health care clearinghouses as well, but

we would clarify the statutory language

in our regulations for health care

providers: we would have the

regulations apply to any health care

provider only when electronically

transmitting any of the transactions to

which section 1173(a)(1) of the Act

refers.

Electronic transmissions would

include transmissions using all media,

even when the transmission is

physically moved from one location to

another using magnetic tape, disk, or CD

media. Transmissions over the Internet

(wide-open), Extranet (using Internet

technology to link a business with

information only accessible to

collaborating parties), leased lines, dialup lines, and private networks are all

included. Telephone voice response and

‘‘faxback’’ systems would not be

included.

Our regulations would apply to health

care clearinghouses when transmitting

transactions to, and receiving

transactions from, any health care

provider or health plan that transmits

and receives standard transactions (as

defined under ‘‘transaction’’) and at all

times when transmitting to or receiving

transactions from another health care

clearinghouse.

Entities that offer on-line interactive

transmission must comply with the

standards. The HyperText Markup

Language (HTML) interaction between a

server and a browser by which the data

elements of a transaction are solicited

from a user would not have to use the

standards, although the data content

must be equal to that required for the

standard. Once the data elements are

assembled into a transaction by the

server, the transmitted transaction

would have to comply with the

standards.

The law would apply to each health

care provider when transmitting or

receiving any of the specified electronic

transactions. Transactions for certain

services that are not normally

considered health care services, but

which may be covered by some health

plans, would not be subject to the

standards proposed in this rule. These

services would include, but not be

limited to: nonemergency

transportation, physical alterations to

living quarters for the purpose of

accommodating disabilities, and case

management. Other services may be

added to this list at the discretion of the

Secretary.

We invite comments on this list and

ask for identification of other types of

services that may fall into this category.

We will publish a complete list of these

services and a process to request an

exemption in the final rule.

The law applies to health plans for all

transactions.

Section 142.104 would contain the

following provisions (from section 1175

of the Act):

If a person conducts a transaction (as

defined in § 142.103) with a health plan

as a standard transaction, the following

apply:

(1) The health plan may not refuse to

conduct the transaction as a standard

transaction.

(2) The health plan may not delay the

transaction or otherwise adversely

affect, or attempt to adversely affect, the

person or the transaction on the ground

that the transaction is a standard

transaction.

(3) The information transmitted and

received in connection with the

transaction must be in the form of

standard data elements of health

information.

As a further requirement, we would

provide that a health plan that conducts

transactions through an agent assure

that the agent meets all the requirements

of part 142 that apply to the health plan.

Section 142.105 would state that a

person or other entity may meet the

requirements of § 142.104 by either—

(1) Transmitting and receiving

standard data elements, or

(2) Submitting nonstandard data

elements to a health care clearinghouse

for processing into standard data

elements and transmission by the health

care clearinghouse and receiving

standard data elements through the

health care clearinghouse.

Health care clearinghouses would be

able to accept nonstandard transactions

for the sole purpose of translating them

into standard transactions for sending

customers and would be able to accept

standard transactions and translate them

into nonstandard formats for receiving

customers. We would state in § 142.105

that the transmission of nonstandard

transactions, under contract, between a

health plan or a health care provider

and a health care clearinghouse would

not violate the law.

Transmissions within a corporate

entity would not be required to comply

with the standards. A hospital that is

wholly owned by a managed care

company would not have to use the

standards to pass encounter information

back to the home office, but it would

have to use the standard claims

transaction to submit a claim to another

health plan. Another example might be

transactions within Federal agencies

and their contractors and between State

agencies within the same State. For

example, Medicare enters into contracts

with insurance companies and common

working file sites that process Medicare

claims using government furnished

software. There is constant

communication, on a private network,

between HCFA Central Office and the

Medicare carriers, intermediaries and

common working file sites. This

communication may continue in

nonstandard mode. However, these

contractors must comply with the

standards when exchanging any of the

transactions covered by HIPAA with an

entity outside these ‘‘corporate’’

boundaries.

Although there are situations in

which the use of the standards is not

required (for example, health care

providers may continue to submit paper

claims and employers are not required

to use any of the standard transactions),

we stress that a standard may be used

voluntarily in any situation in which it

is not required.

B. Definitions

Section 1171 of the Act defines

several terms and our proposed rules

would, for the most part, simply restate

the law. The terms that we are defining

in this proposed rule follow:

1. ASC X12 stands for the Accredited

Standards Committee chartered by the

American National Standards Institute

to design national electronic standards

for a wide range of business

applications.

2. ASC X12N stands for the ASC X12

subcommittee chartered to develop

electronic standards specific to the

insurance industry.

3. Code set.

We would define ‘‘code set’’ as

section 1171(1) of the Act does: ‘‘code

set’’ means any set of codes used for

encoding data elements, such as tables

of terms, medical concepts, medical

diagnosis codes, or medical procedure

codes.

4. Health care clearinghouse.

We would define ‘‘health care

clearinghouse’’ as section 1171(2) of the

Act does, but we are adding a further,

clarifying sentence. The statute defines

a ‘‘health care clearinghouse’’ as a

public or private entity that processes or

facilitates the processing of nonstandard

data elements of health information into

standard data elements. We would
Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules 25277

further explain that such an entity is

one that currently receives health care

transactions from health care providers

and other entities, translates the data

from a given format into one acceptable

to the intended recipient, and forwards

the processed transaction to appropriate

health plans and other health care

clearinghouses, as necessary, for further

action.

There are currently a number of

private clearinghouses that perform

these functions for health care

providers. For purposes of this rule, we

would consider billing services,

repricing companies, community health

management information systems or

community health information systems,

value-added networks, and switches

performing these functions to be health

care clearinghouses.

5. Health care provider.

As defined by section 1171(3) of the

Act, a ‘‘health care provider’’ is a

provider of services as defined in

section 1861(u) of the Act, a provider of

medical or other health services as

defined in section 1861(s) of the Act,

and any other person who furnishes

health care services or supplies. Our

regulations would define ‘‘health care

provider’’ as the statute does and clarify

that the definition of a health care

provider is limited to those entities that

furnish, or bill and are paid for, health

care services in the normal course of

business.

For a more detailed discussion of the

definition of health care provider, we

refer the reader to our proposed rule,

HCFA–0045-P, Standard Health Care

Provider Identifier, published elsewhere

in this Federal Register.

6. Health information.

‘‘Health information,’’ as defined in

section 1171 of the Act, means any

information, whether oral or recorded in

any form or medium, that—

• Is created or received by a health

care provider, health plan, public health

authority, employer, life insurer, school

or university, or health care

clearinghouse; and

• Relates to the past, present, or

future physical or mental health or

condition of an individual, the

provision of health care to an

individual, or the past, present, or

future payment for the provision of

health care to an individual.

We propose the same definition for

our regulations.

7. Health plan.

We propose that a ‘‘health plan’’ be

defined essentially as section 1171 of

the Act defines it. Section 1171 of the

Act cross refers to definitions in section

2791 of the Public Health Service Act

(as added by Public Law 104–191, 42

U.S.C. 300gg–91); we would incorporate

those definitions as currently stated into

our proposed definitions for the

convenience of the public. We note that

many of these terms are defined in other

statutes, such as the Employee

Retirement Income Security Act of 1974

(ERISA), Public Law 93–406, 29 U.S.C.

1002(7) and the Public Health Service

Act. Our definitions are based on the

roles of plans in conducting

administrative transactions, and any

differences should not be construed to

affect other statutes.

For purposes of implementing the

provisions of administrative

simplification, a ‘‘health plan’’ would be

an individual or group health plan that

provides, or pays the cost of, medical

care. This definition includes, but is not

limited to, the 13 types of plans listed

in the statute. On the other hand, plans

such as property and casualty insurance

plans and workers compensation plans,

which may pay health care costs in the

course of administering nonhealth care

benefits, are not considered to be health

plans in the proposed definition of

health plan. Of course, these plans may

voluntarily adopt these standards for

their own business needs. At some

future time, the Congress may choose to

expressly include some or all of these

plans in the list of health plans that

must comply with the standards.

Health plans often carry out their

business functions through agents, such

as plan administrators (including third

party administrators), entities that are

under ‘‘administrative services only’’

(ASO) contracts, claims processors, and

fiscal agents. These agents may or may

not be health plans in their own right;

for example, a health plan may act as

another health plan’s agent as another

line of business. As stated earlier, a

health plan that conducts HIPAA

transactions through an agent is

required to assure that the agent meets

all HIPAA requirements that apply to

the plan itself.

‘‘Health plan’’ includes the following,

singly or in combination:

a. ‘‘Group health plan’’ (as currently

defined by section 2791(a) of the Public

Health Service Act). A group health

plan is a plan that has 50 or more

participants (as the term ‘‘participant’’ is

currently defined by section 3(7) of

ERISA) or is administered by an entity

other than the employer that established

and maintains the plan. This definition

includes both insured and self-insured

plans. We define ‘‘participant’’

separately below.

Section 2791(a)(1) of the Public

Health Service Act defines ‘‘group

health plan’’ as an employee welfare

benefit plan (as currently defined in

section 3(1) of ERISA) to the extent that

the plan provides medical care,

including items and services paid for as

medical care, to employees or their

dependents directly or through

insurance, or otherwise.

It should be noted that group health

plans that have fewer than 50

participants and that are administered

by the employer would be excluded

from this definition and would not be

subject to the administrative

simplification provisions of HIPAA.

b. ‘‘Health insurance issuer’’ (as

currently defined by section 2791(b) of

the Public Health Service Act).

Section 2791(b)(2) of the Public

Health Service Act currently defines a

‘‘health insurance issuer’’ as an

insurance company, insurance service,

or insurance organization that is

licensed to engage in the business of

insurance in a State and is subject to

State law that regulates insurance.

c. ‘‘Health maintenance organization’’

(as currently defined by section 2791(b)

of the Public Health Service Act).

Section 2791(b) of the Public Health

Service Act currently defines a ‘‘health

maintenance organization’’ as a

Federally qualified health maintenance

organization, an organization recognized

as such under State law, or a similar

organization regulated for solvency

under State law in the same manner and

to the same extent as such a health

maintenance organization. These

organizations may include preferred

provider organizations, provider

sponsored organizations, independent

practice associations, competitive

medical plans, exclusive provider

organizations, and foundations for

medical care.

d. Part A or Part B of the Medicare

program (title XVIII of the Act).

e. The Medicaid program (title XIX of

the Act).

f. A ‘‘Medicare supplemental policy’’

as defined under section 1882(g)(1) of

the Act.

Section 1882(g)(1) of the Act defines

a ‘‘Medicare supplemental policy’’ as a

health insurance policy that a private

entity offers a Medicare beneficiary to

provide payment for expenses incurred

for services and items that are not

reimbursed by Medicare because of

deductible, coinsurance, or other

limitations under Medicare. The

statutory definition of a Medicare

supplemental policy excludes a number

of plans that are generally considered to

be Medicare supplemental plans, such

as health plans for employees and

former employees and for members and

former members of trade associations

and unions. A number of these health

plans may be included under the
25278 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

definitions of ‘‘group health plan’’ or

‘‘health insurance issuer’’, as defined in

a. and b. above.

g. A ‘‘long-term care policy,’’

including a nursing home fixedindemnity policy. A ‘‘long-term care

policy’’ is considered to be a health plan

regardless of how comprehensive it is.

We recognize the long-term care

insurance segment of the industry is

largely unautomated and we welcome

comments regarding the impact of

HIPAA on the long-term care segment.

h. An employee welfare benefit plan

or any other arrangement that is

established or maintained for the

purpose of offering or providing health

benefits to the employees of two or more

employers. This includes plans and

other arrangements that are referred to

as multiple employer welfare

arrangements (‘‘MEWAs’’) as defined in

section 3(40) of ERISA.

i. The health care program for active

military personnel under title 10 of the

United States Code.

j. The veterans health care program

under chapter 17 of title 38 of the

United States Code.

This health plan primarily furnishes

medical care through hospitals and

clinics administered by the Department

of Veterans Affairs for veterans with a

service-connected disability that is

compensable. Veterans with nonservice-connected disabilities (and no

other health benefit plan) may receive

health care under this health plan to the

extent resources and facilities are

available.

k. The Civilian Health and Medical

Program of the Uniformed Services

(CHAMPUS), as defined in 10 U.S.C.

1072(4).

CHAMPUS primarily covers services

furnished by civilian medical providers

to dependents of active duty members of

the uniformed services and retirees and

their dependents under age 65.

l. The Indian Health Service program

under the Indian Health Care

Improvement Act (25 U.S.C. 1601 et

seq.).

This program furnishes services,

generally through its own health care

providers, primarily to persons who are

eligible to receive services because they

are of American Indian or Alaskan

Native descent.

m. The Federal Employees Health

Benefits Program under 5 U.S.C. chapter

89.

This program consists of health

insurance plans offered to active and

retired Federal employees and their

dependents. Depending on the health

plan, the services may be furnished on

a fee-for-service basis or through a

health maintenance organization.

Note: Although section 1171(5)(M) of the

Act refers to the ‘‘Federal Employees Health

Benefit Plan,’’ this and any other rules

adopting administrative simplification

standards will use the correct name, the

Federal Employees Health Benefits Program.

One health plan does not cover all Federal

employees; there are over 350 health plans

that provide health benefits coverage to

Federal employees, retirees, and their eligible

family members. Therefore, we will use the

correct name, the Federal Employees Health

Benefits Program, to make clear that the

administrative simplification standards apply

to all health plans that participate in the

Program.

n. Any other individual or group

health plan, or combination thereof, that

provides or pays for the cost of medical

care.

We would include a fourteenth

category of health plan in addition to

those specifically named in HIPAA, as

there are health plans that do not

readily fit into the other categories but

whose major purpose is providing

health benefits. The Secretary would

determine which of these plans are

health plans for purposes of title II of

HIPAA. This category would include

the Medicare Plus Choice plans that will

become available as a result of section

1855 of the Act as amended by section

4001 of the Balanced Budget Act of 1997

(Pub. L. 105–33) to the extent that these

health plans do not fall under any other

category.

8. Medical care.

‘‘Medical care,’’ which is used in the

definition of health plan, would be

defined as current section 2791 of the

Public Health Service Act defines it: the

diagnosis, cure, mitigation, treatment, or

prevention of disease, or amounts paid

for the purpose of affecting any body

structure or function of the body;

amounts paid for transportation

primarily for and essential to these

items; and amounts paid for insurance

covering the items and the

transportation specified in this

definition.

9. Participant.

We would define the term

‘‘participant’’ as section 3(7) of ERISA

currently defines it: a ‘‘participant’’ is

any employee or former employee of an

employer, or any member or former

member of an employee organization,

who is or may become eligible to receive

a benefit of any type from an employee

benefit plan that covers employees of

such an employer or members of such

organizations, or whose beneficiaries

may be eligible to receive any such

benefits. An ‘‘employee’’ would include

an individual who is treated as an

employee under section 401(c)(1) of the

Internal Revenue Code of 1986 (26

U.S.C. 401(c)(1)).

10. Small health plan.

We would define a ‘‘small health

plan’’ as a group health plan with fewer

than 50 participants.

The HIPAA does not define a ‘‘small

health plan’’ but instead leaves the

definition to be determined by the

Secretary. The Conference Report

suggests that the appropriate definition

of a ‘‘small health plan’’ is found in

current section 2791(a) of the Public

Health Service Act, which is a group

health plan with fewer than 50

participants. We would also define

small individual health plans as those

with fewer than 50 participants.

11. Standard.

Section 1171 of the Act defines

‘‘standard,’’ when used with reference

to a data element of health information

or a transaction referred to in section

1173(a)(1) of the Act, as any such data

element or transaction that meets each

of the standards and implementation

specifications adopted or established by

the Secretary with respect to the data

element or transaction under sections

1172 through 1174 of the Act.

Under our definition, a standard

would be a set of rules for a set of codes,

data elements, transactions, or

identifiers promulgated either by an

organization accredited by ANSI or the

HHS for the electronic transmission of

health information.

12. Transaction.

‘‘Transaction’’ would mean the

exchange of information between two

parties to carry out financial and

administrative activities related to

health care. A transaction would be (a)

any of the transactions listed in section

1173(a)(2) of the Act and (b) any

determined appropriate by the Secretary

in accordance with section 1173(a)(1)(B)

of the Act. We present them below in

the order in which we propose

standards for them in the regulations

text.

A ‘‘transaction’’ would mean any of

the following:

a. Health claims or equivalent

encounter information.

This transaction may be used to

submit health care claim billing

information, encounter information, or

both, from health care providers to

health plans, either directly or via

intermediary billers and claims

clearinghouses.

b. Health care payment and

remittance advice.

This transaction may be used by a

health plan to make a payment to a

financial institution for a health care

provider (sending payment only), to

send an explanation of benefits or a

remittance advice directly to a health

care provider (sending data only), or to
Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules 25279

make payment and send an explanation

of benefits remittance advice to a health

care provider via a financial institution

(sending both payment and data).

c. Coordination of benefits.

This transaction can be used to

transmit health care claims and billing

payment information between health

plans with different payment

responsibilities where coordination of

benefits is required or between health

plans and regulatory agencies to

monitor the rendering, billing, and/or

payment of health care services within

a specific health care/insurance

industry segment.

In addition to the nine electronic

transactions specified in section

1173(a)(2) of the Act, section 1173(f)

directs the Secretary to adopt standards

for transferring standard data elements

among health plans for coordination of

benefits and sequential processing of

claims. This particular provision does

not state that there should be standards

for electronic transfer of standard data

elements among health plans. However,

we believe that the Congress, when

writing this provision, intended for

these standards to apply to the

electronic form for coordination of

benefits and sequential processing of

claims. The Congress expressed its

intent on these matters generally in

section 1173(a)(1)(B), where the

Secretary is directed to adopt ‘‘other

financial and administrative

transactions * * * consistent with the

goals of improving the operation of the

health care system and reducing

administrative costs.’’

d. Health claim status.

This transaction may be used by

health care providers and recipients of

health care products or services (or their

authorized agents) to request the status

of a health care claim or encounter from

a health plan.

e. Enrollment and disenrollment in a

health plan.

This transaction may be used to

establish communication between the

sponsor of a health benefit and the

health plan. It provides enrollment data,

such as subscriber and dependents,

employer information, and health care

provider information. The sponsor is the

backer of the coverage, benefit or

product. A sponsor can be an employer,

union, government agency, association,

or insurance company. The health plan

refers to an entity that pays claims,

administers the insurance product or

benefit, or both.

f. Eligibility for a health plan.

This transaction may be used to

inquire about the eligibility, coverage, or

benefits associated with a benefit plan,

employer, plan sponsor, subscriber, or a

dependent under the subscriber’s

policy. It also can be used to

communicate information about or

changes to eligibility, coverage, or

benefits from information sources (such

as insurers, sponsors, and health plans)

to information receivers (such as

physicians, hospitals, third party

administrators, and government

agencies).

g. Health plan premium payments.

This transaction may be used by, for

example, employers, employees, unions,

and associations to make and keep track

of payments of health plan premiums to

their health insurers.

h. Referral certification and

authorization.

This transaction may be used to

transmit health care service referral

information between health care

providers, health care providers

furnishing services, and health plans. It

can also be used to obtain authorization

for certain health care services from a

health plan.

i. First report of injury.

This transaction may be used to report

information pertaining to an injury,

illness, or incident to entities interested

in the information for statistical, legal,

claims, and risk management processing

requirements. Although we are

proposing a definition for this

transaction, we are not proposing a

standard for it in this Federal Register

document. (See section E.9 for a more

in-depth discussion.) We will publish a

separate proposed rule for it.

j. Health claims attachments.

This transaction may be used to

transmit health care service information,

such as subscriber, patient,

demographic, diagnosis, or treatment

data for the purpose of a request for

review, certification, notification, or

reporting the outcome of a health care

services review. Although we are

proposing a definition for this

transaction, we are not proposing a

standard for it in this Federal Register

document because the legislation gave

the Secretary an additional year to

designate this standard. We will publish

a separate proposed rule for it.

k. Other transactions as the Secretary

may prescribe by regulation.

Under section 1173(a)(1)(B) of the

Act, the Secretary shall adopt standards,

and data elements for those standards,

for other financial and administrative

transactions deemed appropriate by the

Secretary. These transactions would be

consistent with the goals of improving

the operation of the health care system

and reducing administrative costs.

C. Effective Dates—General

Health plans would be required by

Part 142 to comply with our

requirements as follows:

1. Each health plan that is not a small

health plan would have to comply with

the requirements of Part 142 no later

than 24 months after the effective date

of the final rule.

2. Each small health plan would have

to comply with the requirements of Part

142 no later than 36 months after the

effective date of the final rule.

Health care providers and health care

clearinghouses would be required to

begin using the standard by 24 months

after the effective date of the final rule.

(The effective date of the final rule

will be 60 days after the final rule is

published in the Federal Register.)

Provisions of trading partner

agreements that stipulate data content,

format definitions or conditions that

conflict with the adopted standard

would be invalid beginning 36 months

from the effective date of the final rule

for small health plans, and 24 months

from the effective date of the final rule

for all other health plans.

If HHS adopts a modification to an

implementation specification or a

standard, the implementation date of

the modification would be no earlier

than the 180th day following the

adoption of the modification. HHS

would determine the actual date, taking

into account the time needed to comply

due to the nature and extent of the

modification. HHS would be able to

extend the time for compliance for small

health plans. This provision would be at

§ 142.106.

The law does not address scheduling

of implementation of the standards; it

gives only a date by which all

concerned must comply. As a result,

any of the health plans, health care

clearinghouses, and health care

providers may implement a given

standard earlier than the date specified

in the subpart created for that standard.

We realize that this may create some

problems temporarily, as early

implementers would have to be able to

continue using old standards until the

new ones must, by law, be in place.

At the WEDI Healthcare Leadership

Summit held on August 15, 1997, it was

recommended that health care providers

not be required to use any of the

standards during the first year after the

adoption of the standard. However,

willing trading partners could

implement any or all of the standards by

mutual agreement at any time during

the 2-year implementation phase (3-year

implementation phase for small health

plans). In addition, it was recommended
25280 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

that a health plan give its health care

providers at least 6 months notice before

requiring them to use a given standard.

We welcome comments specifically

on early implementation as to the extent

to which it would cause problems and

how any problems might be alleviated.

D. Data Content

[Please label any written comments or emailed comments about this section with the

subject: Data Content]

We propose standard data content for

each adopted standard. There are two

aspects of data content standardization:

(1) Standardization of data elements,

including their formats and definition,

and (2) standardization of the code sets

or values that can appear in selected

data elements. A telephone number is

an example of a data element that has

a standard definition and format, but

does not have an enumerated set of

valid codes or values. A patient’s

diagnosis is an example of a data

element that has a standard definition,

a standard format, and a set of valid

codes. Information that would facilitate

data content standardization, while also

facilitating identical implementations,

would consist of implementation

guides, data conditions, and data

dictionaries, as noted in the addenda to

this proposed rule, and the standard

code sets for medical data that are part

of this rule. Data conditions are rules

that define the situations when a

particular data element or record/

segment can be used. For example, ‘‘the

name of the tribe’’ applies only to

Indian Health Service claims. The

defining rule for that data element

would be ‘‘must be entered if claim is

Indian Health Service’’.

1. Data Element and Record/Segment

Content

Once we publish the final rule in the

Federal Register and it is effective, there

will be no additional data element or

record/segment content modifications in

any of the transactions for at least one

year.

In our evaluation and

recommendation for each proposed

standard transaction, we have tried to

meet as many business needs as

possible while retaining our

commitment to the guiding principles.

We encourage comments on how the

standards may be improved.

It is important to note that all data

elements would be governed by the

principle of a maximum defined data

set. No one would be able to exceed the

data sets defined in the final rule, until

that rule is amended one or more years

from the effective date of the final rule.

This means that if a transaction has all

of the data possible—based on the

appropriate implementation guide, data

content and data conditions

specifications, and data dictionary—

then a health plan would have to accept

the transaction and process it. This does

not mean, however, that the health plan

would have to store or use information

that it does not need in order to process

a claim or encounter, except for audit

trail purposes or for coordination of

benefits if applicable. It does mean that

the health plan would not be able to

require additional information, and it

does mean that the health plan would

not be able to reject a transaction

because it contains information the

health plan does not want. This

principle applies to the data elements of

all transactions proposed for adoption

in this proposed rule.

2. Code Sets

[Please label any written comments or emailed comments about this section with the

subject: Code Sets]

a. Background

The administrative simplification

provisions of HIPAA require the

Secretary of HHS to adopt standards for

code sets for administrative and

financial transactions. Two types of

code sets are required for data elements

in the transaction standards to be

established under HIPAA: (1) Large

code sets for medical data, including

coding systems for:

• Diseases, injuries, impairments,

other health related problems, and their

manifestations;

• Causes of injury, disease,

impairment, or other health-related

problems;

• Actions taken to prevent, diagnose,

treat, or manage diseases, injuries, and

impairments and any substances,

equipment, supplies, or other items

used to perform these actions; and (2)

smaller sets of codes for other data

elements such as race/ethnicity, type of

facility, and type of unit.

A separate HIPAA implementation

team co-chaired by representatives from

HCFA, the Centers for Disease Control/

National Center for Health Statistics,

and the National Institutes of Health/

National Library of Medicine, and

including members from other

interested HHS agencies and Federal

Departments, was established to

recommend the code sets that should

become HIPAA standards for medical

data. HHS efforts to identify candidate

medical data code sets were coordinated

with the NCVHS Subcommittee on

Health Data Needs, Standards, and

Security. The smaller sets of codes for

other data elements in transactions

standards are part of the transaction

standards themselves and are specified

in their implementation guides.

The following medical data code sets

are already in use in administrative and

financial transactions:

ICD–9–CM: The International

Classification of Diseases, Ninth

Revision, Clinical Modification,

classifies both diagnoses (Volumes 1

and 2) and procedures (Volume 3). All

hospitals and ambulatory care settings

use it to capture diagnoses for

administrative transactions. The

procedure system is used for all inpatient procedure coding for

administrative transactions. The ICD–9–

CM was adopted for use in January

1979.

The ICD–9–CM Coordination and

Maintenance Committee is a Federal

interdepartmental committee charged

with maintaining and updating the ICD–

9–CM. Requests for modification are

handled through the ICD–9–CM

Coordination and Maintenance

Committee; no official changes are made

without being brought before this

committee. Suggestions for

modifications come from both the

public and private sectors and

interested parties are asked to submit

recommendations for modification prior

to a scheduled meeting.

Modifications are not considered

without the expert advice of clinicians,

epidemiologists, and nosologists (both

public and private sectors). The

meetings are open to the public and are

announced in the Federal Register; all

interested members of the public are

invited to attend and submit written

comments. Meetings are held twice each

year.

Approved modifications become

effective October 1 of the following year.

Changes to ICD–9–CM are published on

the NCHS and HCFA websites, as well

as by the American Hospital Association

(AHA) and other private sector vendors.

CPT: Physicians’ Current Procedural

Terminology is used by physicians and

other health care professionals to code

their services for administrative

transactions. CPT is level one of the

Health Care Financing Administration

Procedure Coding System (HCPCS).

CPT codes are updated annually by

the AMA. The CPT Panel is comprised

of 15 physicians, 10 nominated by the

AMA and one each nominated by Blue

Cross/Blue Shield of America (BCBSA),

HIAA, HCFA, and AHA. Meetings are

not open to the public.

Alpha-numeric HCPCS: Alphanumeric Health Care Financing

Administration Procedure Coding

System (HCPCS) contains codes for

medical equipment and supplies;
Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules 25281

prosthetics and orthotics; injectable

drugs; transportation services; and other

services not found in CPT. Alphanumeric codes are level 2 of HCPCS. Its

use is generally limited to ambulatory

settings. The Omnibus Budget

Reconciliation Act of 1986 requires the

use of HCPCS in the Medicare program

for services in hospital outpatient

departments.

Level II of HCPCS is updated annually

and is maintained jointly by the BCBSA,

the Health Insurance Association of

America and HCFA.

HCFA’s regional offices assure

coordination of local code assignments

among the payers in a State; local codes

must be approved by HCFA’s central

office to assure they do not duplicate

national codes in CPT or Level II of

HCPCS.

Decisions regarding additions,

deletions and revisions to Level II of

HCPCS are made by the Alpha-Numeric

Editorial Panel. This Panel, which meets

three times a year, is comprised of

representatives of the BCBSA, HIAA,

and HCFA; the meetings are not open to

the public. There are formal

mechanisms to coordinate this Panel’s

activities with CPT and the American

Dental Association’s (ADA) procedure

coding system.

The revised HCPCS is available free of

charge as a public use file.

CDT: Current Dental Terminology is

used in reporting dental services. CDT

codes are also included in alphanumeric HCPCS with a first character of

D.

Codes are revised on a five-year cycle

by the ADA through its Council on

Dental Benefits Program. Meetings are

not open to the public.

NDC: National Drug Codes are used in

reporting prescription drugs in

pharmacy transactions and some claims

by health care professionals. The codes

are assigned when the drugs are

approved or repackaged and may be

found on the packaging of drugs.

i. Candidates for the Standards

The principal sources of input to the

recommendations for medical data code

sets were:

(a) The ANSI HISB Standards

Inventory.

The inventoried code sets are:

ICD–9–CM, which consists of both

diagnoses and procedure sections. The

diagnosis system is widely used in the

health care industry. All hospitals and

ambulatory care settings use it to

capture diagnoses. The procedure

system is used for all in patient

procedure coding.

ICD–10–CM for diagnosis, which is

under development as a replacement to

the diagnosis section of ICD–9–CM and

not yet in use in this country. ICD–10

was developed by the World Health

Organization and has been implemented

in approximately 37 countries to report

mortality data. These are data that are

taken and coded from death certificates.

However, since our country’s need for

morbidity data cannot be satisfied by

ICD–10, the United States is preparing

a clinical modification of ICD–10 (ICD–

10–CM). The public has been given an

opportunity to review and comment on

the current draft of ICD–10–CM. The

final draft should be available in the

summer of 1998.

• ICD–10–PCS for procedures, which

is under development for use in the U.S.

only as a replacement to the procedure

section of ICD–9–CM.

• CPT, which is used by all

physicians and many other practitioners

to code their services. It is also used by

hospital outpatient departments to code

certain ambulatory services.

• SNOMED (Systematized

Nomenclature of Medicine), which is

being used by the developers of

computer-based patient record systems.

It is not used in administrative

transactions.

• CDT, which is used by all

practicing dentists to code their services

for administrative transactions.

• NIC (Nursing Interventions

Classification), which is not used in

administrative transactions in this

country.

• LOINC (Logical Observation

Identifier Names and Codes), which is

being used in a pilot-test by the Centers

for Disease Control to report tests as

evidence of a communicable disease. It

is also being tested in electronic

transactions involving detailed clinical

laboratory tests and results. It is not

used in administrative transactions.

• HHCC (Home Health Care

Classification system), which is not

being used as a reporting system in this

country.

(b) A more extensive inventory of

existing coding and classification

systems prepared by the coding and

classification implementation team

itself and evaluated against the general

HIPAA standards evaluation criteria (as

found in section I.B., Process for

developing standards for this proposed

rule).

This larger inventory (which will be

placed on the home page of the National

Center for Health Statistics at: http://

www.cdc.gov/nchswww/

nchshome.htm) does not include any

additional viable candidates for the

initial standards for administrative code

sets to be established under this

proposed rule. It does contain some

additional systems that may be

applicable to elements of the claims

attachments standard (to be issued on a

later timetable) and to eventual HIPAA

recommendations to the Congress

regarding full electronic medical

records.

(c) The oral and written testimony

submitted at an NCVHS public hearing

to discuss medical/clinical coding and

classification issues in connection with

the requirements of HIPAA on April 15–

16, 1997. The following entities

presented testimony at the hearing:

AMA, AHA, American Health

Information Management Association,

American College of Obstetricians and

Gynecologists, American Academy of

Pediatrics, American Nurses

Association, National Association for

Home Care, ADA, Family Practice

Primary Care Work Group, National

Association of Children’s Hospitals and

Related Institutions, Food and Drug

Administration, College of American

Pathologists, the Omaha System,

developers of new nomenclature

systems, research groups, publishers,

consultants in coding, managed care

organizations, software vendors, and

informatics specialists.

(d) The NCVHS’ recommendations to

the Secretary, HHS regarding codes and

classifications.

(e) Comments received in response to

presentations at professional meetings

and at the July 9, 1997, public meeting

held by HHS on progress on selecting

the initial HIPAA standards.

For the hearing on April 15–16, 1997,

the NCVHS invited interested

organizations representing both the

users and developers of medical/clinical

classification systems to present written

and/or oral testimony responding to the

following questions.

‘‘—What medical/clinical codes and

classifications do you use in administrative

transactions now? What do you perceive as

the main strengths and weaknesses of

current methods for coding and

classification of encounter and/or

enrollment data?

‘‘—What medical/clinical codes and

classifications do you recommend as initial

standards for administrative transactions,

given the time frames in the HIPAA? What

specific suggestions would you like to see

implemented regarding coding and

classification?

‘‘—Prior to the passage of HIPAA, the

National Center for Health Statistics

initiated development of a clinical

modification of the International

Classification of Diseases-10 (ICD–10–CM),

and HCFA undertook development of a

new procedure coding system for inpatient

procedures (called ICD–10–PCS), with a

plan to implement them simultaneously in

the year 2000. On the pre-HIPAA schedule,

they will be released to the field for
25282 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

evaluation and testing by 1998. If some

version of ICD is to be used for

administrative transactions, do you think it

should be ICD–9–CM or ICD–10–CM and

ICD–10–PCS, assuming that field

evaluations are generally positive?

‘‘—Recognizing that the goal of P.L. 104–191

is administrative simplification, how, from

your perspective, would you deal with the

current coding environment to improve

simplification, reduce administrative

burden, but also obtain medically

meaningful information?

‘‘—How should the ongoing maintenance of

medical/clinical code sets and the

responsibility, intellectual input and

funding for maintenance be addressed for

the classification systems included in the

standards? What are the arguments for

having these systems in the public domain

versus in the private sector, with or

without copyright?

‘‘—What would be the resource implications

of changing from the coding and

classification systems that you currently

are using in administrative transactions to

other systems? How do you weigh the costs

and benefits of making such changes?

‘‘—A Coding and Classification

Implementation Team has been established

within the Department of Health and

Human Services to address the

requirements of P.L. 104–191; the Team’s

charge is enclosed. Does your organization

have any concerns about the process being

undertaken by the Department to carry out

the requirements of the law in regard to

coding and classification issues? If so, what

are those concerns and what suggestions

do you have for improvements?’’

In general, those testifying at the April

15–16 hearing recommended that

systems currently in use be designated

as standards for the year 2000, since

potential replacements were not yet

fully tested and could not be

implemented throughout the health care

system by 2000. Testimony supported

moving to ICD–10–CM for medical

diagnoses after the year 2000 (different

timetables were mentioned). Testimony

provided by representatives from the

American Psychiatric Association

described the ongoing efforts to make

the Diagnostic and Statistical Manual of

Mental and Behavioral Disorders (DSM)

completely compatible with ICD. The

American Psychiatric Association has

crosswalked the appropriate ICD–9–CM

codes to what appear in the DSM for its

diagnostic categories and is doing the

same for ICD–10–CM for diagnosis. The

mapping between DSM and ICD–10–CM

for diagnosis is more precise than is

possible for ICD–9–CM so the APA

favors moving to ICD–10–CM for

diagnosis as soon as possible.

Many of those testifying emphasized

the need to change to a less fragmented,

overlapping, and duplicative approach

to procedure coding, but sometime after

the year 2000. Different potential

approaches to achieving a more

integrated procedure coding system

were mentioned. Many identified

current variations in the

implementation of coding systems and

the use of local HCPCS codes as

problems that should be addressed.

In general, those testifying approved

the implementation team’s charge,

which includes an initial focus on the

administrative standards for the year

2000 and longer term attention to

recommendations for the more

clinically-detailed vocabulary needed

for full electronic medical records.

Some of the developers of vocabularies

and classifications who presented

testimony emphasized the potential

usefulness of their systems for full

computer-based patient records, rather

than for the administrative transactions

that are the focus of the initial HIPAA

standards.

Comments on codes and

classifications sets made at the June 3–

4, 1997, Health Data Needs, Standards

and Security Subcommittee hearings in

San Francisco, California echoed those

heard at the April hearing.

On June 25, 1997, the NCVHS

submitted the following

recommendations to the Secretary of

HHS regarding standards for codes and

classifications for administrative

transactions:

The Committee recommends that diagnosis

and procedure coding continue to use the

current code sets because replacements will

not be ready for implementation by the year

2000. ICD–9–CM diagnosis codes, ICD–9–CM

Volume 3 procedure codes, and HCPCS

(including Current Procedural Terminology

(CPT) and Current Dental Terminology

(CDT)) procedure codes should be adopted as

the standards to be implemented by the year

2000. Annual updates to ICD–9–CM and

HCPCS should continue to follow the

schedule currently used. In addition, we

recommend that you advise industry to build

and modify their information systems to

accommodate a change to ICD–10–CM

diagnosis coding in the year 2001 and a

major change to a unified approach to coding

procedures (yet to be defined) by the year

2002 or 2003. We recommend that you

identify and implement an approach for

procedure coding that addresses deficiencies

in the current systems, including issues of

specificity and aggregation, unnecessary

redundancy, and incomplete coverage of

health care providers and settings.

At the July 9, 1997, public meeting on

progress on selecting the HIPAA

standards, the implementation team

presented an overview of its planned

recommendations for coding and

classification standards for the year

2000. The team’s recommendations

were similar to those of the NCVHS but

included the use of NDC codes for

pharmacy transactions that the NCVHS

did not address. The implementation

team did not recommend a specific

timetable for changes in the standards

after the year 2000. The team believed

that its recommendations for changes

after the year 2000 should await the

results of field testing of ICD–10–CM for

diagnosis and ICD–10–PCS for

procedures (which should be available

in March 1998) and further

consideration of options for moving

toward a more integrated approach to

procedure coding.

One of the coding systems that the

implementation team considered to be

promising for future implementation

was the Universal Product Numbers

(UPNs) system. The UPN system is a

product numbering technology that uses

human readable and bar code formats to

identify products. A bar code and

human readable number, which is

unique to a particular product, is

printed on the label or box as part of the

production line process. There are

currently two separate and different

UPN coding systems that are generally

accepted and recognized for health care

products. One is numeric, a fixed 14

digit number, and the other an alphanumeric format, a variable length

number 8 to 20 digits. The numeric

format is the system of the Health Care

Uniform Code Council (UCC) and the

alpha-numeric format is used by the

Health Industry Business

Communications Council (HIBCC). The

first series of digits are assigned by one

of these two private companies and

identify the manufacturer or a

repackager. The remaining digits are

assigned by the manufacturer or

repackager and are assigned according

to the user’s own standards and

specifications. A manufacturer or

repackager can apply to either one of

these companies to use its system. The

application fees, which are collected by

either UCC or HIBCC, vary based on the

manufacturer’s or repackager’s sales

volume.

The Department of Defense has

started to use UPNs for its prime vendor

program. Currently, there are purchasers

and providers of medical equipment

that are using the UPN system for

inventory purposes, but, at this time,

there are no insurers that pay for health

care products using the UPN system.

California Medicaid, however, has plans

to begin using UPNs as part of its

system.

At this time, approximately 30

percent of the health care products do

not have a UPN assigned to them. For

this reason, in addition to the fact that

no insurer currently uses UPNs for

reimbursement, UPNs were not

included in the initial list of standards.
Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules 25283

However, it is a coding system that

bears close examination during the next

few years as a possible replacement for

alpha-numeric HCPCS codes for health

care products. Some consideration is

being given to conducting a

demonstration study in the Medicare

program on the use of UPNs for

reimbursement.

Comments on the use of the UPNs as

a national coding system are being

sought. In particular, comments on

issues such as timing of

implementation, any complications

presented by the existence of multiple

bodies issuing UPN codes, the

acceptability of varying lengths and

formats, and the frequent changes in

manufacture and packaging size would

be helpful.

ii. Changes to HCPCS for

Implementation in the Year 2000

In proposing the use of the existing

coding systems as the standards for the

year 2000, many participants at public

meetings voiced concern about overlaps

in several of the coding systems,

problems with HCPCS local codes,

differences in implementation of NDC

codes in different systems, and

differences between the CDT codes in

HCPCS and those issued by the ADA. It

was repeatedly suggested that these

issues be resolved and overlaps be

eliminated for standards adopted in the

year 2000. After careful consideration of

all public input and of the options for

modifying HCPCS in the relatively near

term, the implementation team is

recommending that changes be

implemented in HCPCS in the year 2000

to reduce its overlap with other coding

systems.

HCPCS contains three levels. Level 1,

CPT, is developed and maintained by

the AMA and captures physician

services. Level 2, alpha-numeric

HCPCS, contains codes for products,

supplies, and services not included in

CPT. Level 3, local codes, includes all

the codes developed by insurers and

agencies to fulfill local needs.

We are proposing the adoption of

HCPCS levels 1 and 2 for

implementation in the year 2000. In

addition, we are proposing to modify

HCPCS level 3 for the year 2000 to

eliminate overlaps and duplications.

Most third-party public and private

health insurers (such as Medicare

contractors, Medicaid program and

fiscal agents, and private commercial

health insurers) use HCPCS as a basis

for paying claims for medical services

provided on a fee-for-service basis and

for monitoring the quality and

utilization of care. In addition,

integrated health systems, such as

managed care organizations, also use

HCPCS as a basis for monitoring

utilization and quality of care and for

negotiating prospective fees and

capitated payments. Research

organizations use the HCPCS data

collected by health insurers to monitor

and evaluate these programs and

regional/national patterns of care.

As previously stated, HCPCS alphanumeric codes capture products,

supplies, and services not included in

CPT. The ‘‘D’’ codes in the HCPCS

system are dental codes created by the

ADA and published as CDT. However,

in HCPCS, the first digit ‘‘0’’ in CDT is

replaced by a ‘‘D’’ to eliminate

confusion and overlap with certain CPT

codes. The ADA has agreed to replace

their first digit ‘‘0’’ with a ‘‘D’’ so that

CDT can become the national standard.

There would no longer be dental codes

within HCPCS. Consequently, CDT

codes will no longer be issued within

HCPCS as of the year 2000. The ADA

will be the sole source of the

authoritative version of CDT.

The ‘‘J’’ codes within alpha-numeric

HCPCS are for drugs. A separate coding

system, the NDC developed by the Food

and Drug Administration, is also used to

report drug claims in the ANSI X12N

837—Health Care Claim: Professional

and in pharmacy transactions. The NDC

system, which has 11-digit codes, is

more precise and more current than the

HCPCS ‘‘J’’ codes. NDC identifies drugs

prescribed down to the manufacturer,

product name and package size. NDC

codes are assigned on a continuous

basis throughout the year as new drug

products are issued; ‘‘J’’ codes are

assigned on an annual basis. Many

providers are currently forced to

maintain both ‘‘J’’ and NDC codes to

provide data to different insurers. The

majority of the local codes currently

created were developed because of the

lack of a ‘‘J’’ code for a new drug. Local

codes are level 3 of the HCPCS and are

assigned by local insurers or agencies

where there is no national code. By

eliminating ‘‘J’’ codes from alphanumeric HCPCS codes and utilizing

only NDC codes for drugs, greater

national uniformity can be achieved, the

workload of providers who previously

had to utilize two drug coding systems

will be reduced, and the need for local

codes will diminish substantially.

HHS is, therefore, proposing that NDC

codes become the national standard in

the year 2000 for all types of

transactions requiring drug codes and

that ‘‘J’’ codes be deleted from alphanumeric HCPCS. This would require

those handling electronic administrative

transactions to process 11-digit NDC

codes in the year 2000.

Level 3 of HCPCS is intended to meet

local needs and is established on a local

basis by health insurers. There is no

national registry for these local codes.

We propose that, beginning in the year

2000, local codes be eliminated and that

a national process be established for

reviewing and approving codes that are

needed by any public or private health

insurer.

The first step in this process would be

to ask public and private health insurers

to review the local codes they use and

to immediately eliminate those that

duplicate a national HCPCS code or

NDC code already in existence. (See the

previous section for a discussion of NDC

codes.) They would also be asked to

eliminate those local codes for which

there are few claims submissions (for

example, fewer than 50 per year) and

that could reasonably and effectively be

reviewed by the health insurer. Health

insurers would also be asked to

eliminate those local codes which were

established for administrative purposes,

to facilitate claims payment, rather than

to identify and describe medical

services, supplies and procedures. (A

code for ‘‘administration of

immunization at public health clinic’’ is

an example of a code that includes

administrative information in addition

to information about the clinical content

of the service.) This purging would

result in the elimination of the vast

majority of local codes now in use. Any

remaining local codes would then have

to be submitted by the health insurer to

HCFA for review and approval as

temporary codes. The HCPCS panel

currently meets every two to three

months to approve requests for

temporary codes. This process will be

re-examined to determine if more

frequent meetings are required.

The process would be modeled after

the one that is currently used to review

and approve code requests from

Medicare and its contractors. Codes that

are approved by HCFA would be

established as national temporary codes

that would be posted electronically and

would be available for use by all health

insurers. National temporary codes

would be reviewed on an annual basis

to make sure they are not duplicative of

CPT codes or alpha-numeric codes that

are newly established.

This new centralized process for

establishing national temporary codes

would run parallel to the process for

establishing national CPT codes, alphanumeric HCPCS codes, and NDC codes.

It is expected that most of the codes

submitted for approval by HCFA in this

process would be for new medical

technologies and services not yet

approved for codes by CPT or the alpha-
25284 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

numeric process or for other medical

services/procedures covered by health

insurers which have no associated CPT

or alpha-numeric codes.

These recommendations are based on

the following:

As stated earlier, many participants at

public meetings voiced concerns about

overlaps in codes that are used and the

proliferation of local codes. Local codes

that are duplicative of national codes

create extra work and confusion for

providers who must submit different

codes to different health insurers. Local

codes also make it more difficult for

researchers and programs such as

Medicaid and Medicare to evaluate and

monitor patterns of care and the

utilization and quality of care on a

regional or national basis.

The use of local codes established for

administrative purposes, to facilitate

claims payment rather than to identify

medical services, supplies and

procedures, is contrary to the intent of

the medical coding system, which is

intended to describe medical services

used to prevent, diagnose, treat or

manage diseases, injuries, and

impairments. Administrative functions

necessary to process and facilitate

claims by health insurers can be

achieved by using ‘‘administrative’’

codes placed in fields other than those

used for medical diagnosis and

procedure codes or by attaching a

modifier to a medical code. Because the

need for new temporary codes is not

unique to an individual health insurer,

the new codes that are created as a

result of this centralized process would

be useful not just to the health insurer

who submitted the original request for

a code but also to many other health

insurers across the country. By

eliminating duplicative and otherwise

unnecessary local codes and adding

national temporary codes through the

centralized process discussed above, we

believe we are being consistent with the

intent of HIPAA to simplify the

administration of the claims review,

payment and monitoring process.

We welcome comments and

suggestions on this proposal for

eliminating unnecessary local codes and

establishing a centralized, national

process for establishing national

temporary codes. We seek input

specifically on the problems and

barriers to creating this type of process.

We are also specifically looking for

examples of the kinds of local codes that

are now being used that would have to

be replaced with national codes or for

alternatives to the above-described

process.

iii. Recommended Standards and

Implementation Guides

The proposed standard code sets for

different types of medical data are

outlined below:

(a) Diseases, injuries, impairments,

other health related problems, their

manifestations, and causes of injury,

disease, impairment, or other healthrelated problems.

The proposed standard code set for

these conditions is the International

Classification of Diseases, 9th edition,

Clinical Modification, (ICD–9–CM),

Volumes 1 and 2, as maintained and

distributed by the National Center for

Health Statistics, Centers for Disease

Control and Prevention, U.S.

Department of Health and Human

Services. The specific data elements for

which ICD–9–CM is the required code

set are enumerated in the

implementation guides for the

transactions standards that require its

use.

An area of weakness of the ICD–9–CM

is that it is not always precise or

unambiguous. However, there are no

viable alternatives for the year 2000.

Many problems cannot be resolved

within the current structure, but are

being addressed in the development of

ICD–10–CM for diagnosis, which is

expected to be ready for implementation

some time after the year 2000.

The official coding guidelines for this

proposed standard code set are in the

public domain and available at no cost

on the NCHS website at: http://

www.cdc.gov/nchswww/about/

otheract/icd9/icd9hp2.htm. Users

without access to the Internet may

purchase the official version of ICD–9–

CM on CD–ROM from the Government

Printing Office (GPO) at 1–202–512–

1800 or fax 1–202–512–2250. The CD–

ROM contains the ICD–9–CM

classification and the coding guidelines.

The guidelines are also included in code

books and coding manuals published by

not-for-profit (for example, the

American Hospital Association and the

American Health Information

Management Association) and other

private sector vendors.

(b) Procedures or other actions taken

to prevent, diagnose, treat, or manage

diseases, injuries and impairments.

(1) Physician Services

The proposed standard code set for

these entities is the Current Procedural

Terminology (CPT) (level 1 of HCPCS)

as maintained and distributed by the

AMA. The specific data elements for

which CPT (including codes and

modifiers) is a required code set are

enumerated in the implementation

guides for the transaction standards that

require its use.

Narrative coding guidelines are

presented at the beginning of each of the

six sections of print edition of CPT and,

in addition, special instructions for

specific codes or groups of codes appear

throughout CPT. CPT is available from

the AMA at a charge as well as from

several not-for-profit and other private

sector vendors.

An area of weakness of the CPT is that

it is not always precise or unambiguous.

However, there are no viable

alternatives for the year 2000.

(2) Dental Services

The proposed standard code set for

these services is the Current Dental

Terminology (CDT) as maintained and

distributed by the ADA for a charge. The

specific data elements for which CDT is

a required code set are enumerated in

the implementation guides for the

transaction standards that require its

use.

The official implementation

guidelines for this standard appear in

CDT as descriptors that explain the

appropriate use of the codes. Copies of

the ADA Current Procedural

Terminology Second Edition (CDT–2)

may be obtained by calling 1–800–947–

4746. The ADA is in the process of

developing CDT–3 for introduction in

the year 2000.

(3) Inpatient Hospital Services

The proposed standard code set for

these services is the International

Classification of Diseases, 9th edition,

Clinical Modification, Volume 3, as

maintained and distributed by the

Health Care Financing Administration,

U.S. Department of Health and Human

Services. The specific data elements for

which ICD–9–CM, Volume 3, is a

required code set are enumerated in the

implementation guides for the

transactions standards that require its

use.

As stated earlier, an area of weakness

of the ICD–9–CM is that it is not always

precise or unambiguous. However, there

are no viable alternatives for the year

2000 that are more precise or less

ambiguous. Many problems cannot be

resolved within the current structure

but are being addressed in the

development of ICD–10–PCS for

procedures, which is expected to be

ready for implementation some time

after the year 2000.

The official coding guidelines for this

standard are in the public domain and

available at no cost on the NCHS

website at http://www.cdc.gov/

nchswww/about/otheract/icd9/

icd9hp2.htm. Users without access to
Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules 25285

the Internet may purchase the official

version of ICD–9–CM on CD–ROM from

the Government Printing Office at 1–

202–512–1800 or fax 1–202–512–2250.

The CD–ROM contains the ICD–9–CM

classification and the coding guidelines.

The guidelines are also included in code

books and coding manuals published by

not-for-profit (for example, the

American Hospital Association and the

American Health Information

Management Association) and private

sector vendors.

(c) Other Health-Related Services

The proposed standard code set for

other health-related services is the

Health Care Financing Administration

Procedure Coding System (alphanumeric HCPCS) as maintained and

distributed by the Health Care

Financing Administration, U.S.

Department of Health and Human

Services. We are proposing to make

significant modifications to alphanumeric HCPCS for the year 2000.

These modifications are described in

Section II.D.2.a.ii of this proposed rule.

The specific data elements for which

alpha-numeric HCPCS (including codes

and modifiers) is a required code set are

enumerated in the implementation

guides for the transaction standards that

require its use.

Alpha-numeric HCPCS codes meet all

but one of the guiding principles for

choosing standards. An area of

weakness is that it is not always precise

or unambiguous. However, there are no

viable alternatives for the year 2000 that

are more precise or less ambiguous.

Some of the areas of ambiguity in

HCPCS (the ‘‘J’’ codes for drugs, local

codes, variant CDT codes) have been

addressed in the changes recommended

for the year 2000.

The 1998 alpha-numeric HCPCS file

(excluding the D procedure codes

copyrighted by the ADA) is available

from the HCFA website at http://

www.hcfa.gov/stats/pufiles.htm. Users

can also access this page by taking the

Stats and Data link to the Browse/

Download available PUFs link. The

1998 alpha-numeric HCPCS file is on

the HCFA Public Use Files page under

the Utilities/Miscellaneous heading.

The HCPCS is in an executable

format, which includes 1998 alphanumeric HCPCS in both Excel and text,

the 1998 Alpha-Numeric Index in both

Portable Document Format (PDF) and

text, the 1998 Table of Drugs in both

PDF and text, the 1998 HCPCS record

layout in WordPerfect and text, and a

read me file in WordPerfect and text.

(d) Drugs

The proposed standard code set for

these entities is the National Drug Codes

as maintained and distributed by the

Food and Drug Administration, U.S.

Department of Health and Human

Services, in collaboration with drug

manufacturers. The specific data

elements for which NDC is a required

code set are enumerated in the

implementation guides for the

transaction standards that require its

use.

NDC codes as established by the Food

and Drug Administration are made

available on the individual drug

package inserts and product labeling.

The Food and Drug Administration,

Center for Drug Evaluation and

Research, Office of Management,

Division of Database Management,

prepares an annual update, with

periodic cumulative supplements of the

Approved Drug Products with

Therapeutic Equivalence Evaluations for

prescription drug products, over the

counter drug products and discontinued

drug products. The supplements are

available on diskette, on a quarterly

basis, from the National Technical

Information Service at 703–487–6430.

The files are also available on the

Internet’s World Wide Web on the CDER

Home Page at http://www.fda.gov/cder.

The NDC codes are also published in

such drug publications as the

Physicians’ Desk Reference under the

individual drug product listings and

‘‘How supplied.’’

(e) Other Substances, Equipment,

Supplies, or Other Items Used in Health

Care Services

The proposed standard code set for

these entities is the Health Care

Financing Administration Procedure

Coding System (alpha-numeric HCPCS)

as maintained and distributed by the

Health Care Financing Administration,

U.S. Department of Health and Human

Services. We are proposing to make

significant modifications to alphanumeric HPCPS for the year 2000. These

modifications are described in Section

II.D.2.a.ii of this proposed rule. The

specific data elements for which alphanumeric HCPCS is a required code set

are enumerated in the implementation

guides for the transactions standards

that require its use.

The recommended code sets adhere to

the principles for guiding choices for

the standards to be adopted under

HIPAA as follows:

• Improve the efficiency and

effectiveness of the health care system

by leading to cost reductions for or

improvements in benefits from

electronic health care transactions.

Improvements in efficiency and

effectiveness over the current status quo

will result from: (a) The requirement for

all those exchanging electronic

transactions to use a single official

implementation guide for each

recommended code set; and (b) the

proposed changes to HCPCS, which will

eliminate overlap between NDC and

HCPCS, eliminate one of the two current

versions of CDT codes, and eliminate

the use of local HCPCS codes that are

known only to institutions that

developed them.

• Meet the needs of the health data

standards user community, particularly

health care providers, health plans, and

health care clearinghouses.

The recommended code sets meet

some of the needs of the community. To

meet all of the community’s needs (e.g.,

elimination of overlap in procedure

coding systems and better coverage of

nursing and allied health services) will

require changes to the code sets

recommended or their replacement by

newer systems, once these have been

fully tested and revised. Essentially all

segments of the health care community

testified that there was no practical

alternative to the recommended code

sets for the year 2000, although they

recommended changes after that time.

• Be consistent and uniform with the

other HIPAA standards—their data

element definitions and codes and their

privacy and security requirements—

and, secondarily, with other private and

public sector health data standards.

All of the recommended code sets are

required for selected data elements in

more than one of the recommended

transaction standards.

• Have low additional development

and implementation costs relative to the

benefits of using the standard.

The recommended code sets are

currently used by many segments of the

health care community.

• Be supported by an ANSIaccredited standards developing

organization or other private or public

organization that will ensure continuity

and efficient updating of the standard

over time.

All of the recommended code sets are

supported by U.S. government agencies

or private sector organizations that have

demonstrated a commitment to

maintaining them over time.

• Have timely development, testing,

implementation, and updating

procedures to achieve administrative

simplification benefits faster.

All of the recommended code sets

have existing procedures for updating at
25286 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

least annually. NDC updates continually

throughout the year.

• Be technologically independent of

the computer platforms and

transmission protocols used in

electronic health transactions, except

when they are explicitly part of the

standard.

All of the recommended code sets are

technologically independent of

computer platforms and transmission

protocols.

• Be precise and unambiguous, but as

simple as possible.

There are some problems with lack of

precision and ambiguity in all the

recommended code sets, but there are

no viable alternatives for the year 2000.

In the case of ICD–9–CM, many

problems cannot be resolved within the

current structure but are being

addressed in the development of ICD–

10–CM for diagnosis and ICD–10–PCS

for procedures, which are expected to be

ready for implementation some time

after 2000. Some of the sources of

ambiguity in HCPCS (the ‘‘J’’ codes for

drugs, local codes, variant CDT codes)

have been addressed in the changes

recommended for the year 2000. The

movement to a single framework for

procedure coding, sometime after the

year 2000, will address other known

problems with the procedure codes.

• Keep data collection and paperwork

burdens on users as low as is feasible.

Because the recommended code sets

are currently used throughout the health

care community, they should not add

substantially to data collection or

paperwork burdens.

• Incorporate flexibility to adapt more

easily to changes in the health care

infrastructure (such as new services,

organizations, and provider types) and

information technology.

Some of the recommended code sets

lack a desirable level of flexibility; e.g.,

they use hierarchical codes and may

therefore ‘‘run out of room’’ for

additional codes required by advances

in medicine and health care. Since they

appear to be the only feasible

alternatives for the year 2000, steps

should be taken to improve their

flexibility—or replace them with more

flexible options—sometime after the

year 2000.

iv. Probable Changes to Coding and

Classification Standards After 2000

Although the exact timing and precise

nature of changes in the code sets

designated as standards for medical data

are not yet known, it is inevitable that

there will be changes to coding and

classification standards after the year

2000. As indicated in testimony at the

NCVHS hearings previously discussed,

changes will be required to address

current coding system deficiencies that

adversely affect the efficiency and

quality of administrative data creation

and to meet international treaty

obligations. For example, ICD–10–CM

for diagnosis is highly likely to replace

ICD–9–CM as the standard for diagnosis

data, possibly in 2001. When any of the

standard code sets proposed in this rule

are replaced by wholly new or

substantially revised systems, the new

standards may have different code

lengths and formats. The current draft of

ICD–10–CM for diagnoses contains 6

digit codes; the longest ICD–9–CM

codes have 5 digits. In addition to

accommodating the initial code sets

standards for the year 2000, those that

produce and process electronic

administrative health transactions

should build the system flexibility that

will allow them to implement different

code formats beyond the year 2000.

As also clearly expressed in the

hearings and other input to HHS, any

major change in administrative coding

systems involves significant initial costs

and dislocations, as well as some level

of discontinuity in data collected before

and after the change. These factors must

be weighed against expected

improvements in the efficiency of data

creation and in the accuracy and utility

of the data collected. In the future, more

flexible health data systems may assist

in reducing the costs of implementing

changes in administrative coding and

classification standards, especially if

administrative codes can be generated

automatically from more granular

clinical data.

b. Requirements

In § 142.1002, we would state that

health plans, health care clearinghouses,

and health care providers must use in

electronic transactions the diagnosis

and procedure code sets as prescribed

by HHS. The names of these diagnosis

and procedure code sets are published

in a notice in the Federal Register. The

implementation guides for the

transaction standards in part 142,

Subparts K through R would specify

which of the standard medical data code

sets should be used in individual data

elements within those transaction

standards.

In § 142.1004, we would specify that

the code sets in the implementation

guide for each transaction standard in

part 142, subparts K through R, are the

standard for the coded nonmedical data

elements present in that transaction

standard.

In § 142.1010, The requirements

sections of part 142, subparts K through

R, would specify that those who

transmit electronic transactions covered

by the transaction standards must use

the appropriate transaction standard,

including the code sets that are required

by that standard. These sections would

further specify that those who receive

electronic transactions covered by the

transaction standards must be able to

receive and process all standard codes,

without regard to local policies

regarding reimbursement for certain

conditions or procedures, coverage

policies, or need for certain types of

information that are not part of a

standard transaction.

E. Transaction Standards

The HISB prepared an inventory of

candidate standards to be considered by

HHS in the standards adoption process.

HHS wrote letters to the NUBC, the

NUCC, the ADA, and WEDI in order to

consult with them as required by the

Act. HHS also consulted with them

informally and received their support

on all the transactions at various

meetings and at the public meeting we

held on July 9, 1997, in Bethesda,

Maryland. The NCVHS held public

hearings during which any person could

present his or her views. There also

were opportunities for those who could

not attend the public hearings to

provide written advice, and many did

take advantage of that opportunity. In

addition, HHS welcomed informal

advice from any industry member, and

that advice was taken into consideration

during the decision making process.

Recommendations for enrollment and

disenrollment in a health plan,

eligibility for a health plan, health care

payment and remittance advice, health

plan premium payments, first report of

injury, health claim status, and referral

certification and authorization were

overwhelmingly in favor of ASC X12N

implementations. Also, the

recommendation for the National

Council of Prescription Drug Programs

(NCPDP) version 3.2 telecommunication

standard format was not controversial

and was nearly unopposed.

The recommendations for the

professional and institutional claims

were quite controversial, with some

factions supporting the de facto flat file

standards that have been in use for

many years and others supporting X12N

standards.
Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules 25287

(A flat file is a file that has fixedlength records and fixed-length fields.)

Some associations proposed dual

standards with the flat file claim

standards (National Standard Format for

professional claims and electronic UB–

92 for institutional claims) to sunset on

a specified date, at which time the

parallel ASC X12N claim

implementations would become the sole

standards to be used.

The HHS claims implementation team

recommended, and we are proposing for

adoption, the following standards as

implemented through the appropriate

implementation guides, data content

and data conditions specifications, and

data dictionary:

• Health care claim and equivalent

encounter:

+ Retail drug: NCPDP

Telecommunication Claim version 3.2

or equivalent NCPDP Batch Standard

Version 1.0.

+ Dental claim: ASC X12N 837—

Health Care Claim: Dental.

+ Professional claim: ASC X12N

837—Health Care Claim: Professional.

+ Institutional claim: ASC X12N

837—Health Care Claim: Institutional.

• Health care payment and remittance

advice: ASC X12N 835—Health Care

Payment/Advice.

• Coordination of benefits:

+ Retail drug: NCPDP

Telecommunication Standard Format

version 3.2 or equivalent NCPDP Batch

Standard Version 1.0.

+ Dental claim: ASC X12N 837—

Health Care Claim: Dental.

+ Professional claim: ASC X12N

837—Health Care Claim: Professional.

+ Institutional claim: ASC X12N

837—Health Care Claim: Institutional.

• Health claim status: ASC X12N 276/

277—Health Care Claim Status Request

and Response.

• Enrollment and disenrollment in a

health plan: ASC X12 834—Benefit

Enrollment and Maintenance.

• Eligibility for a health plan: ASC

X12N 270/271—Health Care Eligibility

Benefit Inquiry and Response.

• Health plan premium payments:

ASC X12 820—Payment Order/

Remittance Advice.

• Referral certification and

authorization: ASC X12N 278—Health

Care Services Review—Request for

Review and Response.

We chose version 4010 of X12 for

each ASC X12N transaction. Later in

this proposed rule is a list of candidates

for most transactions. The ASC X12N

transactions listed as candidate

standards in this section were originally

specified as version 3070 because at the

time of HISB inventory version 3070

was the most current DSTU version.

However, we are proposing that version

4010 would be proposed in lieu of

version 3070 for the following reasons:

• Version 4010 is millennium ready.

• Version 4010 allows for up-to-date

changes to be incorporated into the

standards.

We will propose a claims attachment

standard in a separate document as the

statute gives the Secretary an additional

year to designate this standard. The

attachment standards are likely to be

drafted so that health care providers

using Health Level 7 (HL7) for their inhouse clinical systems would be able to

send HL7 clinical data to health plans.

Anyone wishing to use the HL7 may

want to consider a translator that

supports the administrative transactions

proposed in this proposed rule and the

HL7.

We will also propose a standard for

first report of injury transactions in a

later rule for reasons explained in depth

under section II.E.9.

1. Standard: Health Claims or

Equivalent Encounter Information

(Subpart K)

[Please label any written comments or emailed comments about this section with the

subject: Health Claims]

a. Background

By the mid-1970s, several health care

industry associations had formed

committees to attempt to standardize

paper health care claim or equivalent

encounter forms. By the mid-1980s,

those committees were standardizing

electronic formats with equivalent data.

By the early 1990s, some of these

committees were working with the ASC

X12N Subcommittee. Nevertheless,

many health plans continued to require

local formats, revising the formats to

suit their own purposes rather than

following procedures in order to revise

the standards. As a result, it is not

unusual for health care providers to

support many electronic health care

claim formats, either directly or by

using clearinghouse services, in order to

do business with the many health plans

covering their patients.

The committees that pursued

organizational goals (such as a more

cost-efficient environment for the

provision of health care, more time and

resources for patient care, and fewer

resources for administration) were

usually sponsored by health care

provider associations such as the

National Council of Prescription Drug

Programs, the AMA, the American

Hospital Association, and the ADA.

Each association contributed to the

development of the four corresponding

accredited claims standards proposed

for adoption, with content based on de

facto standards derived over time.

i. Candidates for the Standard

The HISB developed an inventory of

health care information standards for

HHS to consider for adoption. The

candidate standards for health claims or

equivalent encounter information were:

• Retail drug: NCPDP

Telecommunications Standard Format

Version 3.2.

• Dental claim: ASC X12N 837—

health care claim: dental, version 3070

implementation.

• Professional claim: ASC X12N

837—health care claim: Professional,

version 3070 implementation and HCFA

National Standard Format (NSF),

version 002.00.

+ Institutional claim: ASC X12N

837—health care claim: institutional,

version 3070 implementation and HCFA

Uniform Bill (UB–92) version 4.1

ii. Recommended Standards

The four standards for claims or

equivalent encounter information we

are proposing in this proposed rule are:

• Retail drug: NCPDP

Telecommunications Standard Format

Version 3.2 and equivalent NCPDP

Batch Standard Version 1.0.

The NCPDP was formed in 1977 as

the result of a Senate Ad Hoc Committee

to study standardization within the

pharmacy industry. The NCPDP was

specifically named in HIPAA as a

standards setting organization

accredited by ANSI. The first NCPDP

Telecommunications Standard was

developed in 1988 and allowed

pharmacists to process claims in an

interactive environment. The NCPDP

developed the Telecommunications

Standard Format for electronic

communication of claims between

pharmacy providers, insurance carriers,

third-party administrators, and other

responsible parties. The standard

addresses the data format and content,

the transmission protocol, and other

appropriate telecommunications

requirements. The NCPDP received

input from all aspects of the

prescription drug industry and designed

the standard to be easy to implement

and flexible enough to respond to the

changing needs of the industry. The

NCPDP also provides changes and

additions to the standard to support

unique requirements included in

government mandates.

The NCPDP telecommunications

standard for claim and equivalent

encounter data is on-line interactive.

There is also a batch implementation of

this standard, the NCPDP Batch

Standard Version 1.0. The
25288 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

telecommunications standard data set

includes eligibility/enrollment, claim,

and remittance advice information.

When the transaction is complete, the

sending pharmacy knows whether the

customer is covered by the health plan,

the health plan knows all of the details

of the claim, the pharmacy knows

whether the claim will be paid, and how

much it will be paid, and any pertinent

details regarding the amount of payment

or the reason for denial of payment.

This standard met all 10 of the criteria

used to assess standards.

Since retail drug claims are a

specialized class and the NCPDP

structure contains claims, enrollment/

eligibility and remittance advice data,

we did not recommend the ASC X12N

837 for the retail drug standard.

• Dental claim: ASC X12N 837—

Health Care Claim: Dental.

The ADA recommended adoption of

the ASC X12N 837, version 3070. This

standard met all of the criteria used to

assess standards.

Professional claim: ASC X12N 837—

Health Care Claim: Professional.

HHS consulted with external groups

in accordance with the legislation.

These groups included the NCVHS,

WEDI, the NUCC, the NUBC, the ADA,

and many others.

In a letter, dated March 12, 1997, the

NUCC stated,

The NUCC recommends to the Secretary of

HHS that the ANSI ASC X12 837 transaction

be adopted as a standard for electronically

transmitting professional claims or

equivalent encounters, including

coordination of benefits information, as per

the Administrative Simplification provision

of the HIPAA.

The NUCC recommends that a migration

plan be adopted to allow current trading

partners who use the National Standard

format (NSF) to convert to a standard NSF,

which will be implemented by the Secretary

per the HIPAA, by February 2000 and to

convert to the standard ANSI ASC X12 837

by February 2003.

The AMA also supported the NUCC

recommendation. However, the NCVHS

and WEDI recommended adoption of

the ASC X12N 837 transaction. The

claims implementation team decided

that, since the NUCC was clear that it

wanted the ASC X12N 837 transaction

in the end, it would be better to invest

in migrating to that, rather than support

two standards and take more time for

the transition.

Our recommendation takes into

account the advice we received from

organizations that we consulted directly

and indirectly and from those who

testified before the NCVHS

subcommittee on Health Data Needs,

Standards, and Security. These

organizations included entities

representing all parts of the health care

industry—health care providers, health

plans, and vendors/clearinghouses—to

which the standard will apply.

The ASC X12N 837 standard met all

10 criteria used to assess standards. The

NSF met 5 of the criteria. The NSF does

not improve the efficiency and

effectiveness of the health care system

(#1) because a standard implementation

does not exist. The NSF meets the needs

of many users, particularly Medicare,

but not all of the needs of the user

community (#2). It is not supported by

an ANSI-accredited SDO (#5). There are

no testing or implementation

procedures in place (#6). Due to its

fixed-length structure, it does not

incorporate flexibility to adapt easily to

change (#10).

Institutional claim: ASC X12N 837—

Health Care Claim—Institutional.

HHS consulted with the groups

identified under our discussion of the

standard for professional claims above

in this section and also consulted with

the NUBC on the selection of an

institutional standard. In a letter dated

March 11, 1997, the NUBC stated,

The NUBC recommends the use of the

EMC V.4 (UB–92) as the single electronic

standards transaction for institutional health

claims and encounters. We recommend the

EMC V.4 for the following reasons:

—Nearly all institutional providers already

use the EMC V.4 with a high level of

success.

—The EMC V.4 has been in full production

for over four years.

—There is no additional cost for providers to

adopt the EMC V.4.

—It reduces the risks associated with the

adoption of a new, complex and relatively

untested transaction.

—It allows for a more successful transition to

the 837.

We agree with HCFA that coordination of

benefits transactions (COB) do not require a

fully separate transaction for the health care

claim or encounter. The NUBC also believes

that the EMC V.4 should be used as the

platform for transmitting COB data elements.

At the present time, the NUBC cannot

recommend the use of the 837 as the

electronic institutional claim standard.

We recommend that larger scale testing of

the 837 proceed. Once the transaction has

proven that it can successfully handle the

claim/encounter, the NUBC will consider

endorsing the 837 as a successor standard.

The American Hospital Association

also supported NUBC’s

recommendation. The NCVHS and

WEDI recommended adoption of the

ASC X12N 837 transaction.

Due to the batch nature of the ASC

X12N transactions, each transaction

type and its corresponding data

elements are separated by function. The

adoption of the transactions for those

functions (such as claims and

remittance advice), with the exception

of the NCPDP transaction, have all been

recommended to be ASC X12N

transactions. The ASC X12N 837 met all

10 criteria used to assess the standards.

The UB–92 met 5 of the criteria. The

UB92 does not improve the efficiency

and effectiveness of the health care

system (#1) because a standard

implementation does not exist. The

UB92 is not supported by an ANSIaccredited SDO (#5). There are no

testing or implementation procedures in

place (#6). The UB92 documentation is

ambiguous in some instances and not

always precise (#8). Due to its fixedlength structure, it does not incorporate

flexibility to adopt easily to change

(#10). The NUBC stated it would

consider the 837, once successfully

tested. For these reasons, we have

concluded that the ASC X12N 837

should be adopted as the standard

format implementation of the

institutional claim.

For the most part, a health care

provider would use only one of these

four health care claim implementations,

although a large institution might use

the institutional claim for inpatient and

outpatient claims, the professional

claim for staff physicians who see

private patients within the institution,

and the retail pharmacy claim, if

applicable, which typically would be

administered separately from the rest of

the institution.

Data elements for the various

standards and other information may be

found in Addendum 1.

b. Requirements

In § 142.1102, we would specify the

exact standards we are adopting: the

NCPDP Telecommunications Standard

Format Version 3.2 and equivalent

NCPDP Batch Standard Version 1.0; the

ASC X12N 837—Health Care Claim:

Dental, the ASC X12N 837—Health Care

Claim: Professional, and the ASC X12N

837—Health Care Claim: Institutional.

We would specify where to find the

implementation guide and incorporate it

by reference.

i. Health plans.

In § 142.1104, Requirements: Health

plans, we would require health plans to

accept only the standards specified in

§ 142.1102 for electronic health claims

or equivalent encounter information.

ii. Health care clearinghouses.

We would require in § 142.1106 that

each health care clearinghouse use the

standard specified in § 142.1102 for

health claims or equivalent encounter

information transactions.

iii. Health care providers.
Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules 25289

In § 142.1108, Requirements: Health

care providers, we would require each

health care provider that transmits

health claims and encounter equivalent

electronically to use the standard

specified in § 142.1102.

c. Implementation Guide and Source

The source of implementation guides

for the NCPDP telecommunication claim

version 3.2 and equivalent NCPDP

Batch Standard Version 1.0 is the

National Council for Prescription Drug

Programs, 4201 North 24th Street, Suite

365, Phoenix, AZ, 85016; telephone

602–957–9105; FAX 602–955–0749. The

web site address is: http://

www.ncpdp.org.

NCPDP standards are available to the

public on a 31⁄2’’ diskette for a fee. A set

is defined as containing the

Telecommunications Standard,

Standard Claims Billing Tape Format,

Eligibility Verification and Response,

and Enrollment. Membership in the

NCPDP is not a requirement for

obtaining the standards and associated

implementation guides. The website

contains information and instructions

for obtaining these documents.

The implementation guides for the

ASC X12N standards are available at no

cost from the Washington Publishing

Company site at the following Internet

address: http://www.wpc-edi.com/

hipaa/.

Users without access to the Internet

may purchase implementation guides

from Washington Publishing Company

directly: Washington Publishing

Company, 806 W. Diamond Ave., Suite

400, Gaithersburg, MD, 20878;

telephone 301–590–9337; FAX: 301–

869–9460. The data definitions and

description of data conditions may also

be obtained from this website.

The names of the implementation

guides are:

ASC X12N 837—Health Care Claim:

Professional (004010X098)

ASC X12N 837—Health Care Claim:

Institutional (004010X096)

ASC X12N 837—Health Care Claim:

Dental (004010X097)

2. Standard: Health Care Payment and

Remittance Advice (Subpart L)

[Please label any written comments or emailed comments about this section with the

subject: Payment]

a. Background

The filing of claims for

reimbursement (especially when a large

number of patients have more than one

insurer), control of those claims,

association of payments, denials or

rejections received with the patient

records, posting of adjudication data to

those records, reconciliation of

payments sent to financial institutions,

and storage and retrieval of patient

accounts is a very labor intensive

process when conducted manually. The

process is further complicated by the

diverse requirements and processes for

activities such as billing, payment, and

notification of the large number of

health plans, which requires that health

care provider staff stock multiple types

of forms, be trained in the variety of

requirements, be able to interpret the

wide range of coding schemes used by

each health plan, and maintain billing

and payment manuals for each health

plan.

We believe that automation can

greatly reduce the labor required for

these processes, especially if every

health plan becomes automated around

a standard model so that health care

providers are not required to deal with

different requirements and software.

Automation of the payment and

remittance advice process can provide

many benefits: health care providers can

post claim decisions and payments to

accounts without manual intervention,

eliminating the need for re-keying data;

payments can be automatically

reconciled with patient accounts; and

resources are freed to address patient

care rather than paper and electronic

administrative work.

The ASC X12N Subcommittee

established a workgroup in late 1991 to

develop the ASC X12N 835—Health

Care Claim Payment/Advice, since there

was no existing standard capable of

handling the large datasets necessary for

health care.

i. Candidates for the Standards

Prior to development of the ASC

X12N 835, there were very few

electronic formats available for the

health care claim payment and

remittance advice function. As

researched by the HISB, existing

standards that could be considered for

national implementation under HIPAA

for health care claim payment/

remittance advice included:

ASC X12N 835—Health Care Claim

Payment/Advice, version 3070; ASC

X12N 820 Payment Order/Remittance

Advice; and the National Standard

Format (NSF) for Remittance Version

2.0

ii. Recommended Standard

The standard for remittance advice

proposed in this proposed rule is the

ASC X12N 835 Health Care Claim

Payment/Advice.

HHS chose this standard primarily

because of advice received from

industry members. Health care

providers and health plans in the ASC

X12N Subcommittee rejected the ASC

X12N 820 due to its lack of health care

specific information for this function.

The X12N 820 is used for electronic

payment of health insurance premiums

by employers. Although the NSF is used

by a large number of Medicare

providers, we rejected it because it is

not an ANSI-accredited standard and it

lacks an independent, nongovernmental

body for maintenance.

The ASC X12N 835 may be used in

conjunction with payment systems

relying either on electronic funds

transfer or the creation of paper checks.

It may be sent through the banking

system or it may be split with the

electronic funds transfer portion

directed to a bank, and the data portion

sent either directly or through a health

care clearinghouse to the individual for

whom the funds are intended. If paper

checks are used, the entire transaction is

sent either directly or through a health

care clearinghouse to the individual for

whom the funds are intended. In all

cases, however, the health care provider

may use the electronic data in its own

system, gaining efficiency by means of

automatic posting of patient accounts.

Uniformity is just as important as it is

for health care claims, since there would

be little gain in efficiency for the health

care provider who must adapt to

multiple formats and multiple data

contents for remittance advice. This

transaction is suitable for use only in

batch mode.

HHS, based on recommendations, has

determined that the ASC X12N 835—

Health Care Claim Payment/Advice is

the best candidate for adoption under

HIPAA. A wide range of the health care

community participated in its initial

design, and the ASC X12N is ANSIaccredited. Whereas the NSF met 5 of

the criteria against which we evaluated

the standards, the ASC X12N standards

met all 10. The NSF does not improve

the efficiency and effectiveness of the

health care system (#1) because a

standard implementation does not exist.

The NSF was developed primarily for

Medicare and, therefore, does not meet

all of the needs of the user community

(#2). It is not supported by an ANSIaccredited SDO (#5). There are no

testing or implementation procedures in

place (#6). Due to its fixed-length

structure, it does not incorporate

flexibility to adapt easily to change

(#10).

Data elements for the standard and

other information may be found in

Addendum 2.
25290 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

b. Requirements

In § 142.1202, we would specify the

ASC X12N 835 Health Care Claim

Payment/Advice (004010X091) as the

standard for payment and remittance

advice transactions. We would also

specify the source of the

implementation guide and incorporate it

by reference.

i. Health plans.

In § 142.1204, Requirements: Health

plans, we would require health plans to

use only the standard specified in

§ 142.1202 for electronically

transmitting payment and remittance

advice transactions.

ii. Health care clearinghouses.

We would require in § 142.1206 that

each health care clearinghouse use the

standard specified in § 142.1202 for

payment and remittance advice

transactions.

c. Implementation Guide and Source

The implementation guide for the

ASC X12N 835 (004010X091) is

available at no cost from the

Washington Publishing Company site at

the following Internet address: http://

www.wpc-edi.com/hipaa/.

Users without access to the Internet

may purchase implementation guides

from Washington Publishing Company

directly: Washington Publishing

Company, 806 W. Diamond Ave., Suite

400, Gaithersburg, MD 20878; telephone

301–590–9337; FAX: 301–869–9460.

The data definitions and description of

data conditions may also be obtained

from this website.

3. Standard: Coordination of Benefits

(Subpart M)

[Please label any written comments or emailed comments about this section with the

subject: COB]

a. Background

In an effort to provide better service

to their customers, many health plans

have made arrangements with each

other to send claims electronically in

the order of payment precedence, thus

saving the customer the process of

waiting for another health plan’s notice.

Each health plan in the chain wishes to

see the original claim as well as the

details of its adjudication by prior

health plans that dealt with it. We

believe that there should be a

coordination of benefits standard to

facilitate the interchange of this

information between health plans.

Adoption of a standard for electronic

transmission of standard data elements

among health plans for coordination of

benefits and sequential processing of

claims would serve these goals

expressed by the Congress. Currently,

the coordination of benefits for patients

covered by multiple health plans is a

burdensome chore. The COB transaction

differs somewhat from the others

because there are two models in

existence for conducting it. The first

model is provider-to-plan, where the

provider submits the claim to the

primary insurer, receives payment, and

resubmits the claim (with the remittance

advice from the primary insurer) to the

secondary insurer. The second model is

plan-to-plan, where the provider

supplies the primary insurer with

information needed for the primary

insurer to then submit the claim directly

to the secondary insurer. The choice of

model has been made between the

providers and plans. Where the first

model is used, the primary insurer

essentially has no role in the COB

transaction. Put another way, in the first

model there is no separate COB

transaction. Instead, the COB function is

accomplished by a health care provider

submitting a series of individual claims.

This succession of transactions from

health care provider to primary health

plan to health care provider to

secondary health plan, which often

involves the production, reproduction,

and mailing of paper forms and multiple

claim formats, is time consuming and

administratively costly. In some

instances, it becomes even more

burdensome when the provider shifts

responsibility for these administrative

tasks to the patient. Health plans have

been unwilling to take on the full

responsibility for coordinating benefits

because of the many different forms and

formats used for these transactions.

Administrative simplification and

electronic standards can simplify and

smooth this onerous process. The four

products of administrative

simplification—(1) The uniform

standards for electronic claims

submissions; (2) an electronic

transmission standard for coordination

of benefits; (3) a uniform national

standard for the data elements necessary

for coordination of benefits among

health plans; and (4) uniform health

plan and provider identification

numbers to efficiently route electronic

transactions—would combine to remove

the barriers that health plans currently

face in carrying out transactions. These

products would facilitate the process of

the second model, direct health plan to

health plan coordination of benefits.

Once these standards are implemented,

coordination of benefits could be

completed without provider or patient

intervention and at a lower cost to all

parties than under current practice.

Primary insurers are not required to

participate in COB transactions as

described in the second model. If,

however, a plan does conduct COB

through the second model, then it

would be required to use the standard

format. Primary insurers may determine

whether they wish to participate in COB

transactions (i.e., use the second model)

based on their normal business

practices. Where primary insurers do

perform COB (using the second model)

they must conduct the transaction

electronically as standard transactions.

The ASC X12N 837 Health Care Claim

(refer to E.1. above) is designed to

facilitate coordination of benefits. Each

health plan responsible for the claim

passes the claim on to the next health

plan responsible for the claim. This

transaction describes the original claim

and how previous health plans

adjudicated the claim. In October 1994,

the ASC X12N Subcommittee modified

the ASC X12N 837 Health Care Claim to

fully support coordination of benefits.

i. Candidates for the Standard

a. Retail drug: NCPDP

Telecommunications Standard Format

version 3.2.

b. Dental claim: ASC X12N 837—

Health Care Claim: Dental, version 3070.

c. Professional claim: ASC X12N

837—Health Care Claim: Professional,

version 3070.

d. Institutional claim: ASC X12N

837—Health Care Claim: Institutional,

version 3070; and the Uniform Bill (UB–

92) version 4.1.

ii. Recommended Standard

The standards for the coordination of

benefits exchange we are proposing are:

a. Retail drug: NCPDP

Telecommunications Standard Format

version 3.2 and the equivalent NCPDP

Batch Standard Version 1.0.

b. Dental claim: ASC X12N 837—

Health Care Claim: Dental

(004010X097).

c. Professional claim: ASC X12N

837—Health Care Claim: Professional

(004010X098).

d. Institutional claim: ASC X12N

837—Health Care Claim: Institutional

(004010X096).

Since all recommended transactions

for claims or equivalent encounters and

the remittance advice are ASC X12N,

with the exception of the NCPDP, it was

determined that this transaction was the

best candidate for national

implementation, as it will increase the

synergistic effect of the other ASC X12N

standards.

All health plans who perform COB,

using the second model described

above, would have to send and receive

these standards for coordination of

benefits. The data elements added to
Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules 25291

explain the prior payments on the claim

are shown in the implementation guide,

data conditions, and data dictionary.

This transaction accommodates

coordination of benefits through the

tertiary health plan. The NCPDP

telecommunication claim version 3.2 is

interactive. The three X12 standards are

designed for use only in batch mode.

HHS chose these standards primarily

because of advice received from

industry members.

Data elements for the various

standards and other information may be

found in Addendum 3.

b. Requirements

In § 142.1302, we would specify the

following as the standards for

coordination of benefits: the NCPDP

Telecommunications Standard Format

Version 3.2 and equivalent NCPDP

Batch Standard Version 1.0; the ASC

X12N 837—Health Care Claim: Dental

(004010X097); the ASC X12N 837—

Health Care Claim: Professional

(004010X098); and the ASC X12N 837—

Health Care Claim—Institutional

(004010X096). We would specify where

to find the implementation guide and

incorporate it by reference.

i. Health plans.

In § 142.1304, Requirements: Health

plans, we would require health plans

who perform COB to use only the

standards specified in § 142.1302 for

electronic coordination of benefits

transactions.

ii. Health care clearinghouses.

We would require in § 142.1306 that

each health care clearinghouse use the

standards specified in § 142.1302 for

coordination of benefits.

c. Implementation Guide and Source

The source of implementation guides

for the NCPDP telecommunication claim

version 3.2 and equivalent Standard

Claims Billing Tape Format is the

National Council for Prescription Drug

Programs, 4201 North 24th Street, Suite

365, Phoenix, AZ, 85016; Telephone

602–957–9105, FAX 602–955–0749. The

web site address is: http://

www.ncpdp.org. NCPDP standards are

available to the public on a 31⁄2′′

diskette. A set is defined as containing

the Telecommunications Standard,

Standard Claims Billing Tape Format,

Eligibility Verification and Response,

and Enrollment. Membership in the

NCPDP is not a requirement for

obtaining the standards and associated

implementation guides. The website

contains information and instructions

for obtaining these formats.

The implementation guides for the

three ASC X12N health care claim

standard implementations are available

at no cost from the Washington

Publishing Company site at the

following Internet address: http://

www.wpc-edi.com/hipaa/. The data

definitions and description of data

conditions may also be obtained from

this website.

Users without access to the Internet

may purchase implementation guides

from Washington Publishing Company

directly. Washington Publishing

Company, 806 W. Diamond Ave., Suite

400, Gaithersburg, MD, 20878;

Telephone 301–590–9337; FAX: 301–

869–9460.

The names of the implementation

guides are:

ASC X12N 837—Health Care Claim:

Professional (004010X098)

ASC X12N 837—Health Care Claim:

Institutional (004010X096)

ASC X12N 837—Health Care Claim:

Dental (004010X097)

4. Standard: Health Claim Status

(Subpart N)

[Please label any written comments or emailed comments about this section with the

subject: Status]

a. Background

Health care providers need the ability

to obtain up to date information on the

status of claims submitted to health

plans for payment, and the health plans

need a mechanism to respond to these

requests for information. The current

processes are complicated by the

diverse processes within health plan

adjudication systems, which permit

nonstandard information to be provided

on the status of claims submitted. Most

health care providers currently request

claims status information manually.

This requires health plans to provide

information through various procedures

that are costly and time consuming for

all.

With the paper model of claims

processing, inquirers who want to know

the status of a claim they have

submitted to a health plan call the

health plan. An operator looks up the

status via computer terminal or some

other means and explains the status to

the caller. The health claim status tells

the inquirer whether the claim has been

received, whether it has been paid, or

whether it is stopped in the system

because of edit failures, suspense for

medical review or some other reason.

Many health plans have devised their

own electronic claims status

transactions since this is a function that

is cheaper, easier, and faster to do

electronically. This transaction eases

administrative burden for both health

plan and health care provider.

The ASC X12N Subcommittee

established a workgroup (Workgroup 5

Claims Status) to develop a standard

implementation with standard data

content for all users of the ASC X12N

276/277 Health Care Claim Status

Request and Response (004010X093).

The ASC X12N 276 is used to

transmit request(s) for status of specific

health care claim(s). Authorized entities

involved with processing the claim need

to track the claim’s current status

through the adjudication process. The

purpose of generating an ASC X12N 276

is to obtain the current status of the

claim. Status information can be

requested at various levels. The first

level would be for the entire claim. A

second level of inquiry would be at the

service line level to obtain status of a

specific service within the claim.

The ASC X12N 277 Health Care Claim

Status Response is used by the health

plan to transmit the current status

within the adjudication process. This

can include status in various locations

within the adjudication process, such as

pre-adjudication (accepted/rejected

claim status), claim pending

development, suspended claim(s)

information, and finalized claims status.

Prior to the development of the ASC

X12N 276/277 Health Care Claim Status

Request and Response, there were very

few proprietary or other electronic

formats available for this type of claims

status, and none were in widespread

use. No existing standard was accepted

for national use by the health care

community. As researched by the HISB,

only one standard could be considered

for national implementation under

HIPAA for health care claim status

request and response: the ASC X12N

276/277 Health Care Claim Status

Request and Response, version 3070.

i. Candidates for the Standard

The candidate standard for health

care claim status is:

ASC X12N 276/277 Health Care Claim

Status Request and Response, version

3070.

ii. Standard Selected

We propose to adopt ASC X12N 276/

277 Health Care Claim Status Request

and Response (004010X093), as the

national standard for uniform use by

health plans and health care providers

for health care claims status.

HHS chose this standard primarily

because of advice received from

industry members. It met all 10 of the

criteria used for assessing standards.

Data elements for the standard, and

other information, may be found in

Addendum 4.
25292 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

b. Requirements

In § 142.1402, we would specify the

following as the standard for health care

claims status: ASC X12N 276/277

Health Care Claim Status Request and

Response (004010X093). We would

specify where to find the

implementation guide and incorporate it

by reference.

i. Health plans.

In § 142.1404, Requirements: Health

plans, we would require health plans to

use only the standards specified in

§ 142.1402 for electronic health care

claims status transactions.

ii. Health care clearinghouses.

We would require in § 142.1406 that

each health care clearinghouse use the

standards specified in § 142.1402 for

health care claims status.

iii. Health care providers.

In § 142.1408, Requirements: Health

care providers, we would require each

health care provider that transmits

health care claim status requests

electronically to use standards specified

in § 142.1402 for those transactions.

c. Implementation Guide and Source

The implementation guide for the

standard is available at no cost from the

Washington Publishing Company site at

the following Internet address: http://

www.wpc-edi.com/hipaa/. The data

definitions and description of data

conditions may also be obtained from

this website.

Users without access to the Internet

may purchase implementation guides

from Washington Publishing Company

directly: Washington Publishing

Company, 806 W. Diamond Ave., Suite

400, Gaithersburg, MD, 20878;

telephone 301–590–9337; FAX: 301–

869-9460.

5. Standard: Enrollment and

Disenrollment in a Health Plan (Subpart

O)

[Please label any written comments or emailed comments about this section with the

subject: Enrollment]

a. Background

Currently, employers and other

sponsors conduct transactions with

health plans to enroll and disenroll

subscribers and other individuals in a

health insurance plan. The transactions

are rarely done electronically.

However, the ASC X12 834, Benefit

Enrollment and Maintenance has been

in widespread use within the insurance

industry at large since February 1992

when ANSI approved it as a draft

standard for trial use. Variants of this

transaction standard have been widely

used by employers to advise insurance

companies of enrollment and

maintenance information on their

employees for insurance products other

than health. It has rarely been used

within the health care industry.

i. Candidates for the Standard.

According to the inventory conducted

for HHS by the HISB, only two

standards developed and maintained by

a standards developing organization for

the enrollment transaction exist. The

first is the ANSI ASC X12 834. The

second is the Member Enrollment

Standard developed by the NCPDP.

ii. Recommended Standard.

The ANSI ASC X12 834—Benefit

Enrollment and Maintenance is the

standard proposed for electronic

exchange of individual, subscriber, and

dependent enrollment and maintenance

information between sponsors and

health plans, either directly or through

a vendor, such as a health care

clearinghouse. In some instances, this

transaction may be used also to

exchange enrollment and maintenance

information between sponsors and

health care providers or between health

plans and health care providers.

The NCPDP standard, which was

developed to enhance the enrollment

verification process for pharmaceutical

claims, rather than for transmitting

information between health plan and

sponsor, is not being proposed for

adoption in this rule. The NCPDP

standard pertains to these specific uses

and is therefore not suitable in its

current form for the more general uses

needed for the enrollment transaction.

With the implementation of the ASC

X12 834 for health care, sponsors would

be able to transmit information on

enrollment and maintenance using a

single, electronic format; health plans

would be required to accept only the

standard transaction; neither sponsors

nor health plans would have to continue

to maintain and use multiple

proprietary formats or resort to paper.

Adoption of this standard would

benefit sponsors, especially, by

providing them the ability to convert to

electronic transmission formats where

paper is still being used today. Many of

these sponsors already use X12

standards in their core business

activities (for example, purchasing)

unrelated to the provision of health care

benefits to employees. The utility of this

particular standard for health care

transactions would be synergistic when

considered in combination with the

other standards in this proposed rule

(for example, ASC X12 820) and other

rules (PAYERID, national provider

identifier) promulgated under HIPAA.

In addition to being the only relevant

standard for the enrollment and

maintenance process designed for use

by sponsors, the ANSI ASC X12 834 met

all of the 10 criteria deemed to be

applicable in evaluating this potential

standard.

1. It will improve the efficiency of

enrollment transactions by prescribing a

single, standard format.

2. It was designed to meet the needs

of health care providers, health plans,

and health care clearinghouses by virtue

of its development within the ASC X12

consensus process, in which

representatives of health care providers,

health plans, and health care

clearinghouses participate.

3. It is consistent with the other X12

standards detailed in this proposed rule.

4. Its development costs are relatively

low, given the ASC X12 development

process; its implementation costs would

be relatively low as it can be

implemented along with a suite of X12

transaction sets, often with a single

translator.

5. It was developed and will be

maintained by the ANSI-accredited

standards setting organization ASC X12.

6. It is ready for implementation, with

the official implementation guide to

which we refer in Addendum G to this

proposed rule.

7. It was designed to be technology

neutral by ASC X12.

8. Precise and unambiguous

definitions for each data element in the

transaction set are documented in the

implementation guides.

9. The transaction is designed to keep

data collection requirements as low as is

feasible.

10. All X12 transactions, including

the X12 834, are designed to make it

easy to accommodate constantly

changing business requirements through

flexible data architecture and coding

systems.

iii. Uses of the ANSI ASC X12 834.

Transaction data elements in the

implementation guide for the ASC X12

834 are defined as either required or

conditional, where the conditions are

clearly stated. This transaction would be

used to enroll and disenroll not only the

subscriber, but also any covered

dependents. In some instances, this

would be an enhancement to enrollment

information maintained by sponsors or

health plans, compared with the

common practice today of maintaining

detailed records on the subscriber alone.

In an increasingly value-conscious

health care environment, detailed

information on subscribers and covered

dependents is necessary for the effective

management of their health care

utilization.

Administrative and financial health

care transactions such as the ASC X12

834 enrollment transaction may have
Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules 25293

other, secondary uses that may be

important to consider as well. For

example, secondary uses of health care

claims data are common and include

analyses of health care utilization,

quality, and cost. The ASC X12 834

enrollment transaction has been

discussed (for example, by the NCVHS)

as a means to collect demographic

information on individuals for use by

public health, State data organizations,

and researchers. Typically, demographic

data elements would be used in

combination with information obtained

from other health care transactions,

such as health care claims and

equivalent encounter transactions, and

from other sources.

Proponents of this approach and these

uses have expressed their beliefs that

the enrollment transaction includes

patient demographic data elements and

that this would provide more reliable

data on patient demographics than are

available currently from health care

claims and encounter databases.

Proponents also believe that the

availability of demographic information

is in jeopardy because the X12 837

health care claim transaction proposed

elsewhere in this rule includes minimal

patient demographic data elements. The

use of this standard would be a change

from current practice in many States

where the health care claim is the

vehicle for collecting such information.

Some proponents also have indicated a

desire to expand the number of

demographic data elements contained in

the ASC X12 834 enrollment transaction

to serve these secondary uses.

Opponents of this approach argue that

the ASC X12 834 enrollment transaction

is not a suitable vehicle for collecting

demographic information for these

secondary purposes. They also assert

that such information would never be

available on the uninsured and, since

there is no obligation on the part of

sponsors to adopt the electronic

transactions, would be only

intermittently available on the insured.

They also state that, although some

demographic elements are already

contained in the ASC X12 834

enrollment transaction, no business

need has been identified that would

support the addition of other such data

elements. Finally, the opponents argue

that secondary uses, while legitimate,

should not be allowed to subvert the

primary purposes of these transactions

nor the goal of administrative

simplification.

We welcome comments on the

practical utility of the ASC X12 834

enrollment transaction as a vehicle for

collecting demographic information on

individuals and its value as an adjunct

to claims and encounter data in this

regard.

The data elements for this transaction,

and other information, may be found in

Addendum 5.

b. Requirement

In § 142.1502, we would specify the

ASC X12 834 Benefit Enrollment and

Maintenance (004010X095) as the

standard for enrollment and

disenrollment transactions. We would

also specify the source of the

implementation guide and incorporate it

by reference.

i. Health plans.

In § 142.1504, Requirements: Health

plans, we would require health plans to

use only the standard specified in

§ 142.1502 for electronic enrollment and

disenrollment transactions.

ii. Health care clearinghouses.

We would require in § 142.1506 that

each health care clearinghouse use the

standard specified in § 142.1502 for

enrollment and disenrollment

transactions.

iii. Sponsors.

There would be no requirement for

sponsors to use the standard: they are

not one of the entities subject to the

requirements of HIPAA. However, to the

extent a sponsor uses an electronic

standard, it would benefit that sponsor

to use the standard we adopt for the

reasons discussed earlier. In addition,

HIPAA contains no provisions that

would prohibit a health plan requiring

sponsors with which its conducts

transactions electronically to use the

adopted standard.

c. Implementation Guide and Source

The implementation guide for the

ASC X12N 834 (004010X095) is

available at no cost from the

Washington Publishing Company site

on the World Wide Web at the following

address: http://www.wpc-edi.com/

hipaa/. The data definitions and

description of data conditions may also

be obtained from this website.

Users without access to the Internet

may purchase implementation guides

from Washington Publishing Company

directly. Washington Publishing

Company, 806 W. Diamond Ave., Suite

400, Gaithersburg, MD, 20878;

telephone 301–590–9337; FAX: 301–

869–9460.

6. Standard: Eligibility for a Health Plan

(Subpart P)

[Please label any written comments or emailed comments about this section with the

subject: Eligibility]

a. Background

Often, health care providers may need

to verify not only that a patient has

health insurance coverage but also what

specific benefits are included in that

coverage. Having such information

helps the health care provider to collect

correct patient deductibles, coinsurance amounts, and co-payments

and to provide an accurate bill for the

patient and all pertinent health plans,

including secondary payers.

In addition, simple economics

dictates that the out-of-pocket cost to

the patient may affect treatment choices.

The best case is when there are two

equally effective treatment options and

coverage is only available for one. More

often, the question may be whether a

particular treatment is covered or not.

Here is an example: Jane Doe has cancer

and a bone marrow transplant is the

treatment of last resort. Since insurance

coverage does not extend to

‘‘experimental therapies,’’ the question

becomes: Does Jane’s insurance cover a

bone marrow transplant for her

diagnosis? If she has leukemia, the

treatment may be covered; if she has

cervical cancer, it may not be. Whether

Jane could afford to pay out-of-pocket

for such a treatment could affect her

treatment choice.

The value of eligibility information is

enhanced if it can be acquired quickly.

Traditional methods of communication

(that is, by phone or mail) are highly

inefficient. Patients and health plans

find it disturbing when the deductible

and co-pays are not correctly applied.

When insurance inquiries of this sort

are transmitted electronically, health

care providers can receive the

information from the health plan almost

immediately. However, in current

practice, each health plan may require

that the health care provider’s request

be in a preferred format, which often

does not match the format required by

any other health plan. This means that

the health care provider must maintain

the hardware and software capability to

send multiple inquiry formats and

receive multiple response formats.

Because of this situation, adoption of

electronic methods for inquiries has

been inhibited, and reliance on paper

forms or the telephone for such

inquiries has continued.

i. Candidates for the Standard

The HISB developed an inventory of

health care information standards to be

considered by the Secretary of HHS in

the adoption of standards. The ANSI

ASC X12N 270—Health Care Eligibility

Benefit Inquiry and companion 271—

Health Care Eligibility Benefit Response,

the ASC X12N Interactive Health Care

Eligibility/Benefit Inquiry (IHCEBI) and

its companion the Interactive Health

Care Eligibility/Benefit Response
25294 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

(IHCEBR), the NCPDP

Telecommunications Standard Format,

and the NCPDP Telecommunication

Claim Standard for Pharmaceutical

Professional Services are the standards

available for the electronic exchange of

patient eligibility and coverage

information.

ii. Recommended Standard

We propose to adopt the ANSI ASC

X12N 270—Health Care Eligibility

Benefit Inquiry and the companion ASC

X12N 271—Health Care Eligibility

Benefit Response as the standard for the

eligibility for a health plan transaction.

When evaluated against the criteria

(discussed earlier) for choosing a

national standard, the ASC X12

Transaction Sets 270/271 met the

criteria more often than did the ASC

X12 interactive or the NCPDP

transactions. The ASC X12N 270/271

transaction set is supported by an

accredited standards setting

organization ASC X12 (criteria #5). By

comparison with the alternatives, the

ASC X12N 270/271 would have

relatively low additional development

and implementation costs and would be

consistent with other standards in this

proposed rule (criteria #4 and #3). The

NCPDP standards, because they are

specific to pharmacy transactions, were

rejected because they would not meet

the needs of the rest of the health care

system (criteria #2), whereas the ASC

X12N 270/271 would.

The X12N subcommittee and its

Workgroup 1, which is responsible for

the eligibility transaction, recommended

in June 1997 that the ASC X12N 270/

271 be adopted as the HIPAA standard

(criteria #5).

There are specific, technical reasons

against adoption of the IHCEBI/IHCEBR

at this time. The IHCEBI/IHCEBR is

based on UNEDIFACT, not ASC X12N,

syntax. Because of concurrent changes

in UNEDIFACT design rules, the

IHCEBI/IHCEBR is not a complete or

consistent standard. It has not been

classified by UNEDIFACT as ready to

implement. In X12N, the current version

of IHCEBI/IHCEBR is 3070, and we

believe that current use is centered on

a prior version (3051), which is not

millennium compliant. The IHCEBI/

IHCEBR transaction is not ready to be

moved into version 4 (4010), as are the

other transactions being recommended

in this proposed rule. We also believe

that current use is quite limited, and not

consistent across users; in effect, current

uses of this transaction have been

implemented in proprietary format(s).

For all these reasons, the ICHEBI/

ICHEBR is neither technically ready nor

stable and cannot be recommended as a

standard at this time. Thus, the IHCEBI/

IHCEBR would require higher

additional development and

implementation costs (criteria #4), and

they would not be consistent or uniform

with the other standards selected

(criteria #3).

If an interactive eligibility transaction

standard were ratified by an accredited

standards setting organization sometime

in the future, then it could be

considered for adoption as a HIPAA

standard. However, at this time, we

expect that any future standard for an

interactive eligibility transaction is

likely to differ substantially from the

current IHCEBI/IHCEBR and the time to

readiness could be substantial as well

(criteria #6).

The goal of administrative

simplification, as expressed in the law,

is to improve the efficiency and

effectiveness of the health care system

(criteria #1). Whereas it might seem that

the interactive message would yield

greater efficiencies in terms of time

saved, similar efficiencies are available

with the ASC X12N 270/271. In fact, the

ASC X12N 270 can be used to submit

a single eligibility inquiry electronically

for a very quick turnaround 271

response. Response times, measured in

seconds, would compare favorably to a

true ‘‘interactive’’ transaction and

would be a substantial improvement

over telephone inquiries or paper

methods of eligibility determination.

Transactions concerning eligibility for

a health plan would be used only to

verify the patient’s eligibility and

benefits; they would not provide a

history of benefit use. The electronic

exchange using these standards would

occur usually between health care

providers and health plans, but the

standard would support electronic

inquiry and response among other

entities. In addition to uses by various

health care providers (for example,

hospitals, laboratories, and physicians),

the ASC X12N 270/271 can be used by

an insurance company, a health

maintenance organization, a preferred

provider organization, a health care

purchaser, a professional review

organization, a third-party

administrator, vendors (for example,

billing services), service bureaus (such

as value-added networks), and

government agencies (Medicare,

Medicaid, and CHAMPUS).

The eligibility transaction is designed

to be used for simple status requests as

well as more complex requests that may

be related to specific clinical

procedures. General requests might

include queries for: all benefits and

coverage conditions, eligibility status

(whether the patient is active in the

health plan), maximum benefits (policy

limits), exclusions, in-plan/out-of-plan

benefits, coordination of benefits

information, deductibles, and

copayments. Specific requests might

include procedure coverage dates;

procedure coverage maximum; amounts

for deductible, co-insurance, copayment, or patient responsibility;

coverage limitations; and noncovered

amounts.

Another part of the ASC X12N 271 is

designed to handle requests for

eligibility ‘‘rosters,’’ which are

essentially lists of entities—subscribers

and dependents, health care providers,

employer groups, health plans—and

their relationships to each other. For

example, this transaction might be used

by a health plan to submit a roster of

patients to a health care provider to

designate a primary care physician or to

alert a hospital about forthcoming

admissions. We are not recommending

this use of the ASC X12N 270/271 at

this time because the roster

implementation guide is not

millennium compliant and the

standards development process for the

implementation guide is not completed.

After the standards development

process for the roster implementation

guide is completed, it may be

considered for adoption as a national

standard.

The data elements for this transaction,

and other information, may be found in

Addendum 6.

b. Requirements

i. Health plans.

In § 142.1604, Requirements: Health

plans, we would require health plans to

use only the standard specified in

§ 142.1602 for electronic eligibility

transactions.

ii. Health care clearinghouses.

We would require in § 142.1606 that

each health care clearinghouse use the

standard specified in § 142.1602 for

eligibility transactions.

iii. Health care providers.

In § 142.1608, Requirements: Health

care providers, we would require each

health care provider that transmits any

health plan eligibility transactions

electronically to use the standard

specified in § 142.1602 for those

transactions.

c. Implementation Guide and Source

The implementation guide is available

for the ASC X12N 270/271

(004010X092) at no cost from the

Washington Publishing Company site

on the World Wide Web at the following

address: http://www.wpc-edi.com/

hipaa/. The data definitions and
Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules 25295

description of data conditions may also

be obtained from this website.

Users without access to the Internet

may purchase implementation guides

from Washington Publishing Company

directly. Washington Publishing

Company, 806 W. Diamond Ave., Suite

400, Gaithersburg, MD, 20878;

telephone 301–590–9337; FAX: 301–

869–9460.

7. Standard: Health Plan Premium

Payment (Subpart Q)

[Please label any written comments or emailed comments about this section with the

subject: Premium]

a. Background

Electronic payment methods have

become commonplace for consumers

who pay their monthly mortgage,

power, or telephone bills electronically.

Yet, electronic payment of health

insurance premiums by employers is

not common at all.

Adoption of a standard for electronic

payment of health plan premiums

would benefit employers and other

sponsors, especially, by providing the

opportunity to convert to a single

electronic transmission format where

paper forms and premium payment

formats may vary from health plan to

health plan. Many of these sponsors

already use X12 standards in their core

business activities (for example,

purchasing) unrelated to the provision

of health care benefits to employees.

Federal and State governments when

acting as employers and other

government agencies that transmit

premium payments to outside

organizations (for example, State

Medicaid agencies that pay premiums to

outside organizations such as managed

care organizations) would also benefit

from these electronic transactions.

i. Candidates for Standard.

According to the inventory conducted

for HHS by the HISB, only one standard

developed and maintained by a

standards developing organization for

health plan premium payment

transaction exists. It is the ASC X12

820—Payment Order/Remittance

Advice.

ii. Recommended Standard.

The standard we are proposing to

adopt for health plan premium payment

transactions is the ASC X12 820—

Payment Order/Remittance Advice. If

we adopt the ASC X12 820, health plans

would be able to transmit premium

payments either as a summary payment

or with individual payment detail, or as

payment amount and adjustment

amount, using a single, electronic

format. Health plans would be required

to accept the standard transaction as the

electronic transmission; neither

sponsors nor health plans would have to

continue to maintain and use multiple

proprietary premium payment formats

or resort to paper.

Although the premium order/

remittance advice (ASC X12 820), used

for health plan premium payments, can

be paired with the ASC X12N 811—

Consolidated Service Invoice/Statement,

which is used for health plan premium

billing, our proposal and the focus of

the statute is on a standard only for

health plan premium payments.

In addition to being the only relevant

standard designed for use by sponsors,

the ANSI ASC X12 820 met 9 of the 10

criteria deemed to be applicable in

evaluating this potential standard. It

would improve the efficiency of

premium payment transactions by

prescribing a single, standard format. It

was designed to meet the needs of

health care providers, health plans, and

health care clearinghouses by virtue of

its development within the ASC X12

consensus process, in which

representatives of health care providers,

health plans, and health care

clearinghouses participate. It is

consistent with the other ASC X12

standards detailed in this proposed rule.

Its development costs are relatively low,

given the X12 development process; its

implementation costs would be

relatively low as it can be implemented

along with a suite of X12 transaction

sets, often with a single translator. It

was developed and will be maintained

by the ANSI-accredited standards

setting organization X12. It is ready for

implementation, with the official

implementation guide to which we refer

in Addendum 7 to this proposed rule.

It was designed to be technology neutral

by X12. Precise and unambiguous

definitions for each data element in the

transaction set are documented in the

implementation guides.

The ANSI ASC X12 820—Payment

Order/Remittance Advice is currently

used in applications other than health

care. However, it is currently not in

widespread use in the health insurance

industry because most health plan

premium payments are not done

electronically. However, some large

organizations are using the ASC X12

820 to meet other business

requirements, such as automated

purchasing. The ASC X12 820 is used in

the health care industry for premium

payment information exchanged

between the sponsor and the health

plan; it should not be confused with the

ASC X12 834, which includes

additional nonpremium payment

information. The ASC X12 820 is not

intended to be used to carry enrollment

or other eligibility information.

The data elements for this transaction,

and other information, may be found in

Addendum 7.

b. Requirements

In § 142.1702, we would specify the

following as the standard for health plan

premium payment: ASC X12 820—

Payment Order/Remittance Advice

(004010X061). We would specify where

to find the implementation guide and

incorporate it by reference.

i. Health plans.

In § 142.1704, Requirements: Health

plans, we would require health plans to

accept only the standard specified in

§ 142.1702 for electronic health plan

premium payments.

ii. Health care clearinghouses.

We would require in § 142.1706 that

each health care clearinghouse use the

standards specified in § 142.1702 for

health plan premium payment

transactions.

iii. Sponsors.

There would be no requirement for

sponsors to use the standard: they are

not one of the entities subject to the

requirements of HIPAA. However, to the

extent a sponsor uses an electronic

standard, it would benefit that sponsor

to use the standard we adopt for the

reasons discussed earlier. In addition,

HIPAA contains no provisions that

would prohibit a health plan requiring

sponsors with which its conducts

transactions electronically to use the

adopted standard.

c. Implementation Guide and Source

The implementation guide for this

transaction is the ASC X12N 820—

Payroll Deducted and Other Group

Premium Payment for Insurance

Products (004010X061).

The implementation guide is available

at no cost from the Washington

Publishing Company site on the World

Wide Web at the following address:

http://www.wpc-edi.com/hipaa/.

Users without access to the Internet

may purchase implementation guides

from Washington Publishing Company

directly. Washington Publishing

Company, 806 W. Diamond Ave., Suite

400, Gaithersburg, MD, 20878;

telephone 301–590–9337; FAX: 301–

869–9460.

8. Standard: Referral Certification and

Authorization (Subpart R)

[Please label any written comments or emailed comments about this section with the

subject: Referral]

a. Background

Increasingly, the delivery of health

care is focused on achieving greater
25296 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

value from each health care dollar, and

rigorous monitoring of health care

utilization has become a common

method adopted by health plans for

achieving their value goals. Traditional

methods of communication between

health care providers and health plans

or their designates, which rely on a

combination of paper forms and

telephone calls, are neither efficient nor

cost effective and may impede the

delivery of care. The burden and

inefficiencies of these communications

could be reduced by the adoption of

standardized and electronic methods for

making the requests and receiving

responses.

i. Candidates for Standard.

According to the inventory of

standards produced by the HISB for

HHS, there is only one standard

available for referral certification and

authority. It is the ASC X12N 278,

Health Care Services Review

Information.

ii. Recommended Standard.

The ANSI ASC X12N 278—Health

Care Services Review Information is the

standard proposed for electronic

exchange of requests and responses

between health care providers and

review organizations.

These exchanges of information can

be initiated by either the health care

provider or the health plan. The health

care provider requests from a designated

review entity authorization or

certification for a patient to receive a

particular health care service. In turn,

the review entity receives and responds

to the health care provider’s request. In

addition to direct electronic inquiry and

response, the ASC X12N 278 can be

used in connection with point of service

terminals.

Many different types of organizations

may act as a review entity in such an

exchange. These include health plans,

insurance companies, health

maintenance organizations, preferred

provider organizations, health care

purchasers, managed care organizations

providing coverage to Medicare and

Medicaid beneficiaries, professional

review organizations, other health care

providers, and benefit management

organizations, to name a few.

These requests and responses may

pertain to many different health care

events, including reviews for: treatment

authorization, specialty referrals, preadmission certifications, certifications

for health care services (such as home

health and ambulance), extension of

certifications, and certification appeals.

As with all the other ASC X12

transactions being proposed in this rule,

the ASC X12N 278 was developed with

widespread input from health care

industry representatives in a consensus

process taking into account business

needs. Further, the standard is fully

compatible with the other ASC X12

standards and can be translated to and

from native application systems using

off-the-shelf software (commonly

referred to as ‘‘translators’’) that is

readily available and used by all

industries utilizing ASC X12 standards.

The data elements for this transaction,

and other information, may be found in

Addendum 8.

b. Requirements

In § 142.1802, we would specify the

following as the standard for referral

certifications and authorizations: ASC

X12N 278—Request for Review and

Response (004010X094). We would

specify where to find the

implementation guide and incorporate it

by reference.

i. Health plans.

In § 142.1804, Requirements: Health

plans, we would require health plans to

accept and transmit only the standard

specified in § 142.1802 for electronic

referral certifications and

authorizations.

ii. Health care clearinghouses.

We would require in § 142.1806 that

each health care clearinghouse use the

standard specified in § 142.1802 for

referral certifications and

authorizations.

iii. Health care providers.

In § 142.1808, Requirements: Health

care providers, we would require each

health care provider that transmits

referral certifications and authorizations

electronically to use the standard

specified in § 142.1802 for the

transactions.

c. Implementation Guide and Source

The implementation guide for the

ASC X12N 278 (004010X094) is

available at no cost from the

Washington Publishing Company site

on the World Wide Web at the following

address: http://www.wpc-edi.com/

hipaa/.

Users without access to the Internet

may purchase implementation guides

from Washington Publishing Company

directly. Washington Publishing

Company, 806 W. Diamond Ave., Suite

400, Gaithersburg, MD, 20878;

telephone 301–590–9337; FAX: 301–

869–9460.

9. Standard: First Report of Injury

[Please label any written comments or emailed comments about this section with the

subject: Injury]

Background

‘‘First report of injury’’ is not a

general term or transaction in the health

care insurance industry. Upon

investigation, we found that the

property and casualty insurance

industry, among whose lines of business

is workers compensation insurance, had

developed a standard transaction

entitled ‘‘Report of Injury, Illness or

Incident’’ (ASC X12N 148). This

transaction set was developed within

ASC X12N to encompass more than 30

functions and exchanges that occur

among the numerous parties to a

workers compensation claim. The

transaction can be used by an employer,

first, to report an employee injury or

illness to the State government agency

that administers workers compensation

and, second, to report to the employer’s

workers compensation insurance carrier

so that a claim can be established to

cover the employee’s losses (income,

health care, disability). When the

employer is the Federal government, the

transaction is used to report to the

Department of Labor’s Office of Workers

Compensation Programs. In a few States,

the transaction can also be used by

health care providers to report an

employee’s work-related injury to

employers and/or the employer’s

workers compensation insurance

carrier. The transaction can be used by

State agencies responsible for

monitoring the disposition of a workers

compensation claim. Other uses include

summary reporting of employee injuries

and illness to State workers

compensation boards, commissions, or

agencies; the Federal Bureau of Labor

Statistics; the Federal Occupational

Safety and Health Administration; and

the Federal Environmental Protection

Agency.

The current, approved version of this

transaction is 3070, which is not

millennium compliant. There is no

approved implementation guide for

version 4010, which would be

millennium compliant. The ASC X12N

workgroup is developing a version 4010

or higher implementation guide and

data dictionary. The workgroup hopes

to secure ASC X12N approval for its

revised standard and implementation

guide in the spring of 1998. Current

workgroup planning is for a single

implementation guide that covers all of

the business uses to which we refer

above.

Recommendation:

We do not recommend that the ASC

X12N 148—Report of Injury, Illness or

Incident be adopted at this time, for the

following reasons:

a. There is no millennium-compliant

version of an implementation guide for

this transaction.

b. There is no complete data

dictionary for this transaction.
Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules 25297

c. The implementation guide under

development covers more business

requirements and functions than the

‘‘first report of injury’’ specified in the

statute.

d. Consultation with the transaction’s

extensive user community is necessary

to establish a consensus regarding the

scope of the transaction set, and this is

not possible in the time available to the

Secretary for promulgating a final

regulation.

e. An alternative to the ASC X12N 148

has been brought to our attention and

must be evaluated.

The alternative EDI format is that

developed and maintained by the

International Association of Industrial

Accident Boards and Commissions

(IAIABC). The IAIABC EDI format was

not identified in the ANSI HISB

inventory of standards developed for

HHS because the IAIABC is not an

ANSI-accredited standards setting

organization.

Under the law, a standard adopted

under the administrative simplification

provisions of HIPAA is required to be ‘‘a

standard that has been developed,

adopted, or modified by a standard

setting organization’’ (section 1172(c) of

the Act) (if a standard exists). The

Secretary may adopt a different standard

if it would substantially reduce

administrative costs to health care

providers and health plans when

compared to the alternatives (section

1172(c)(2)(A)).

Accordingly, the IAIABC EDI format

must be evaluated before a national

standard for first report of injury

transactions is adopted because it is

reported to be widely used. The IAIABC

will be requested to submit

documentation so that its first report of

injury format can be evaluated

according to the ten criteria applied to

all other standards.

In assessing the utility of this

alternative standard, we will follow the

Guiding Principles for selecting a

standard to evaluate the IAIABC EDI

format against that developed and

maintained by ANSI ASC X12N. The

following questions about the IAIABC

standard will be of particular

importance:

a. To what extent is this format

widely accepted and used by

organizations performing these

transactions?

b. Is this format millenniumcompliant?

c. Does this standard meet the

requirements set forth in the

Administrative Simplification

provisions of HIPAA for improving the

efficiency and effectiveness of the

health care system?

d. Is this a format developed,

maintained, or modified by a standard

setting organization as specified in

Section 1171 (8) or does it meet the

exceptions specified in Section 1172

(c)(2) of the Act?

We do not recommend that the

IAIABC format be adopted at this time.

We have asked that the IAIABC provide

documentation for their format.

In view of these facts, HHS will take

the following actions with regard to

adopting a standard for ‘‘first report of

injury’’:

a. Continue to monitor the progress of

the ASC X12N subcommittee toward

development of a final, complete,

millennium-compliant standard,

implementation guide, and data

dictionary for this transaction.

b. Request that ASC X12N review the

ASC X12N 148 to determine whether all

of its broad functionality should be

included in a standard to be adopted

under HIPAA authority or whether the

scope of the transaction should be

limited by dividing the functions into

separate implementation guides.

c. Review and evaluate

documentation from the IAIABC on its

format so that it can be evaluated

according to the ten criteria used to

evaluate candidate standards and in

relation to the ASC X12N 148 as

described above.

d. After the ASC X12N subcommittee

has completed its standard setting role

and approved a 4010 version or higher

implementation guide and data

definitions for the ASC X12N 148 and

after analysis of the IAIABC alternative

standard, issue a subsequent proposed

rule promulgating a standard for ‘‘first

report of injury’’.

III. Implementation of the Transaction

Standards and Code Sets

A. Compliance Testing

We have identified three levels of

testing that must be addressed in

connection with the adoption and

implementation of the standards we are

proposing and their required code sets:

Level 1—Developmental Testing—

This is the testing done by the standards

setting organization during the

development process. The conditions

for, and results of, this testing are made

public by the relevant standards bodies,

and are available at the following

Internet web site:

http://www.disa.org

The information on the web site is

provided at the discretion of the

standards setting organization and

could, among other things, refer to pilot,

limited, or large-scale production if

appropriate. Information regarding code

set testing will also be posted to a

website. This website will be advertised

on the HCFA home page.

Level 2—Validation Testing—This is

testing of sample transactions to see

whether they are being written

correctly. We expect that private

industry will provide commercial

testing at this level. This level of testing

would give the participants a sense of

whether they are meeting technical

specifications of structure and syntax

for a transaction, but it may not

necessarily test for valid data. This type

of testing would inform individuals that

the transaction probably meets the

specifications. These edits would be less

rigorous than those that might be

applied by a health plan before payment

(in the case of a claim) or by a health

care provider prior to posting (in the

case of a health care claim payment/

advice). The test conditions and results

from this level are generally shared only

between the parties involved.

Level 3—Production Testing—This

tests a transaction from a sender through

the receiver’s system. The test

information is exposed to all of the

edits, lookups, and checks that the

transaction would undergo in a

production situation. The test

conditions and results from this level

are generally shared only between the

parties involved.

Pilot production—Billions of dollars

change hands each year as a result of

health care claims processing alone. For

that reason, we believe the industry

should sponsor pilot production

projects to test transaction standards

that are not currently in full production

prior to the effective date for adoption.

Pilot production tests are not necessary

for the NCPDP retail pharmacy claim

since it is already in widespread use. On

the other hand, some of the ASC X12N

implementations have not yet been

placed in general production. We

believe that pilot production results

should be posted on a website and show

information of general interest to

potential users. The information given is

at the discretion of the entities

conducting the pilot and might contain

information regarding the number of

claims processed, the identity of the

entities participating in the pilot, and

the name, telephone number or e-mail

address of an individual willing to

answer questions from the public.

It would be useful to all participants

if pilot production projects and the

results were posted to a web site for all

transactions. For the claim and

equivalent encounter transactions, we

believe that posting pilot production

projects and results to a web site must

be mandatory.
25298 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

B. Enforcement

Failure to comply with standards may

well result in monetary penalties. The

Secretary is required by statute to

impose penalties of not more than $100

per violation on any person who fails to

comply with a standard, except that the

total amount imposed on any one

person in each calendar year may not

exceed $25,000 for violations of one

requirement.

We are not proposing any

enforcement procedures at this time, but

we will do so in a future Federal

Regulations document, once the

industry has some experience with

using the standards.

We are at this time, however,

soliciting input on appropriate

mechanisms to permit independent

assessment of compliance. We are

particularly interested in input from

those engaging in health care EDI as

well as from independent certification

and auditing organizations addressing

issues of documentary evidence of steps

taken for compliance; need for/

desirability of independent verification,

validation, and testing of systems

changes; and certifications required for

off-the-shelf products used to meet the

requirements of this regulation.

IV. New and Revised Standards

A. New Standards

To encourage innovation and promote

development, we intend to develop a

process that would allow an

organization to request a replacement to

any adopted standard or standards.

An organization could request a

replacement to an adopted standard by

requesting a waiver from the Secretary

of HHS to test a new standard. The

organization, at a minimum, must

demonstrate that the new standard

clearly offers an improvement over the

adopted standard. If the organization

presents sufficient documentation that

supports testing of a new standard, we

want to be able to grant the organization

a temporary waiver to test it while

remaining in compliance with the law.

We do not intend to establish a process

that would allow organizations to

request waivers as a tool to avoid using

any adopted standard.

We would welcome comments on the

following: (1) How we should establish

this process, (2) the length of time a

proposed standard should be tested

before we decide whether to adopt it,

and (3) other issues and

recommendations we should consider

in developing this process.

Following is one possible process:

• Any organization that wishes to

replace an adopted standard must

submit its waiver request to an HHS

evaluation committee (not currently

established or defined). The

organization must do the following for

each standard it wishes to replace:

+ Provide a detailed explanation, no

more than 10 pages in length, of how

the replacement would be a clear

improvement over the current standard

in terms of the principles listed in

section I.D., Process for developing

national standards, of this preamble.

+ Provide specifications and

technical capabilities on the new

standard, including any additional

system requirements.

+ Provide an explanation, no more

than 5 pages in length, of how the

organization intends to test the

standard, including the number and

types of health care plans and health

care providers expected to be involved

in the test, geographical areas, and

beginning and end dates of the test.

• The committee’s evaluation would,

at a minimum, be based on the

following:

+ A cost-benefit analysis.

+ An assessment of whether the

proposed replacement demonstrates a

clear improvement to an existing

standard.

+ The extent and length of time of the

waiver.

• The evaluation committee would

inform the organization requesting the

waiver within 30 working days of the

committee’s decision on the waiver

request. If the committee decides to

grant a waiver, the notification may

include the following:

+ Committee comments such as the

following:

—The length of time for which the

waiver applies if it differs from the

waiver request.

—The sites the committee believes are

appropriate for testing if they differ from

the waiver request.

—Any pertinent information

regarding the conditions of an approved

waiver.

• Any organization that receives a

waiver would be required to submit a

report containing the results of the

study, no later than 3 months after the

study is completed.

• The committee would evaluate the

report and determine whether the

proposed new standard meets the 10

guiding principles and whether the

advantages of a new standard would

significantly outweigh the

disadvantages of implementing it and

make a recommendation to the

Secretary.

B. Revised Standards

We recognize the very significant

contributions that the traditional

content committees (the NUCC, the

NUBC, the ADA, and the National

Council for Prescription Drug Programs)

have made to health care transaction

content over the years and, in particular,

the work they contributed to the content

of the standards proposed in this

proposed rule. Other Federal and

private entities (the National Center for

Health Statistics, the Health Care

Financing Administration, the AMA,

and the ADA) have developed and

maintained the medical data code sets

proposed as standards in this proposed

rule. In a letter dated June 10, 1997,

WEDI recommended that the NUBC,

NUCC and ADA be recognized as the

appropriate organizations to specify

data content. We expect that these

current committees would continue to

play an important role in maintenance

of data content for standard health care

transactions. The organizations assigned

responsibility for maintenance of data

content for standard health care

transactions will work with X12N data

maintenance committees, ensuring that

implementation documentation is

updated in a consistent and timely

fashion.

We intend that the private sector,

with public sector involvement,

continue to have responsibility for

defining the data element content of the

administrative transactions. Both

Federal agencies and private

organizations will continue to be

responsible for maintaining medical

data code sets. The current data content

committees are focused on transactions

that involve health care providers and

health plans. There may be some

organizations that represent employers

or other sponsors and health plans and

are interested in assuming the burden of

maintenance of the data content

standards for the X12 820 and 834.

We propose to designate content

committees in the final rule and to

specify the ongoing activities of these

content committees pertaining to the

data maintenance of all X12N standards

identified in this rule, as well as

attachments. All approved changes, not

including medical code sets, would

need to fit into the appropriate ASC

X12N implementation guide(s) and

receive ASC X12N approval, with the

exception of the NCPDP standard. The

NCPDP would continue to operate as

currently for data content.

It is important that data content

revisions be made timely in this new

standards environment. The Secretary of

HHS may not revise any standard more
Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules 25299

frequently than once a year and must

permit no fewer than 180 days for

implementation for all participants after

adopting a revised standard. New values

could be added to the code sets for

certain data elements in transaction

standards more frequently than once a

year. For example, alpha-numeric

HCPCS and NDC, two of the proposed

standard code sets for medical data,

now have mechanisms for ongoing

addition to new codes as needed to

reflect new health services and new

drugs. Such ongoing update

mechanisms would continue to be

needed in the year 2000 and beyond.

The private sector organizations

charged with data element content

maintenance would have to ensure that

the revised standard contains the most

recent data maintenance items that have

been brought to them and that those

new data requirements are adequately

documented and communicated to the

public. We believe that, at minimum,

the data maintenance documentation

needs to include the data name, data

definition, the status of the data name

(that is, required or conditional), written

conditions regarding the circumstances

under which the data would have to be

supplied, a rationale for the new or

revised data item, and its placement in

an implementation guide. We believe

that any data request approved by a

body three or more months prior to the

adoption of a new or revised standard

would have to be included in that new

standard implementation, assuming that

no major format restructuring would

have to be done. (A new data element,

code, or segment would not constitute

major restructuring.)

We believe that any body with

responsibility for maintaining a

standard under this proposed rule must

allow public access to their decision

making processes. We plan to engage

standards setting organizations and

other organizations responsible for

maintenance of data element content

and standard code sets to establish a

process that will enable timely

standards development/updates with

appropriate industry input. One

approach may be as follows:

• Each of the data maintenance

bodies has biannual meetings with the

public welcome to attend and

participate without payment of fees.

+ These public meetings are

announced to the broadest possible

audience, at minimum by means of a

website. The announcements of the

meetings may also be available via

widely read publications, such as the

Commerce Business Daily or the Federal

Register.

+ Annual public meeting schedules

are posted on a website not later than

90 days after the effective date of the

final rule, and annually on that date

thereafter.

+ The data maintenance body

establishes a central contact (name and

post office and e-mail addresses) to

which the public could submit

correspondence (such as agenda items

or data requests).

+ During these two open meetings,

the public has the opportunity to voice

concerns and suggest changes.

+ Each data maintenance body drafts

procedures for the public to follow in

regard to its meeting protocols.

• Each data maintenance body drafts

procedures for the public to submit

requests for data or for revisions to the

standard. These draft procedures are

easy to use and are adequately

communicated to the public.

• Each designated data maintenance

body is also responsible for

communicating actions taken on

requests to the requestor and the public,

in addition to communicating any

changes made to a standard. This may

be done via mail, e-mail, publications,

or newsletters but, at a minimum, are

published on the website. (We believe

the Internet is the most cost effective

way of communicating this type of

information.)

• Each data maintenance body

responds definitively to each request it

receives no later than three months after

the request is received.

An alternative approach would be to

require an organization which desired to

be designated by the Secretary as the

official data content maintenance body

for a particular transaction to meet the

ANSI criteria for due process found at

http://www.ansi.org/procl1.html. Not

only would these criteria meet the

intent of HIPAA to advocate an open,

balanced, consensus process, but once

an organization met these criteria, it

would be able to apply for ANSI

accreditation if it so desired.

It is not our intention to increase any

current burdens on data maintenance

bodies. Our concern is that the public

have a voice in the data maintenance

process and that changes to a standard

be timely and adequately communicated

to the industry. We welcome any

comments regarding the approach

outlined above and recommendations

for data maintenance committees for

each X12N transaction standard

identified in this rule.

We also solicit comments on the

appropriateness of ongoing Federal

oversight/monitoring of maintenance

processes and procedures.

V. Collection of Information

Requirements

Under the Paperwork Reduction Act

of 1995 (PRA), we are required to

provide 60-day notice in the Federal

Register and solicit public comment

before a collection of information

requirement is submitted to the Office of

Management and Budget (OMB) for

review and approval. In order to fairly

evaluate whether an information

collection should be approved by OMB,

section 3506(c)(2)(A) of the Paperwork

Reduction Act of 1995 requires that we

solicit comment on the following issues:

• The need for the information

collection and its usefulness in carrying

out the proper functions of our agency.

• The accuracy of our estimate of the

information collection burden.

• The quality, utility, and clarity of

the information to be collected.

• Recommendations to minimize the

information collection burden on the

affected public, including automated

collection techniques.

Subpart K—Health Claims or Equivalent

Encounter Information Standard

142.1104 Requirements: Health plans.

142.1108 Requirements: Health care

providers.

Subpart L—Health Care Payment and

Remittance Advice

142.1204 Requirements: Health plans.

Subpart M—Coordination of Benefits

142.1304 Requirements: Health plans.

Subpart N—Health Claims Status

142.1404 Requirements: Health plans.

142.1408 Requirements: Health care

providers.

Subpart O—Enrollment and Disenrollment in

a Health Plan

142.1504 Requirements: Health plans.

Subpart P—Eligibility for a Health Plan

142.1604 Requirements: Health plans.

142.1608 Requirements: Health care

providers.

Subpart Q—Health Plan Premium Payments

142.1704 Requirements: Health plans.

Subpart R—Referral Certification and

Authorization

142.1804 Requirements: Health plans.

142.1808 Requirements: Health care

providers.

Discussion: In summary, each of the

sections identified above require health

care plans, and/or health care providers

to use any given standard proposed in

this regulation for all electronically

transmitted standard transactions that

require it on and after the effective date

given to it.

The emerging and increasing use of

health care EDI standards and
25300 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

transactions raises the issue of the

applicability of the PRA. The question

arises whether a regulation that adopts

an EDI standard used to exchange

certain information constitutes an

information collection subject to the

PRA. However, for the purpose of

soliciting useful public comment we

provide the following burden estimates.

In particular, the initial burden on the

estimated 4 million health plans and 1.2

million health care providers to modify

their current computer systems software

would be 10 hours/$300 per entity, for

a total burden of 52 million hours/$1.56

billion. While this burden estimate may

appear low, on average, we believe it to

be accurate. This is based on the

assumption that these and the other

burden calculations associated with the

HIPAA administrative simplification

systems modifications may overlap.

This average also takes into

consideration that: (1) One or more of

these standards may not be used; (2)

some of the these standards may already

be in use by several of the estimated

entities; (3) modifications may be

performed in an aggregate manner

during the course of routine business

and/or; (4) modifications may be made

by contractors such as practice

management vendors, in a single effort

for a multitude of affected entities.

We solicit comment on whether the

requirements to which we refer above

constitute a one-time or an ongoing,

usual and customary business practice

as defined 5 CFR 1320.3(b)(2), the

Paperwork Reduction regulations.

We invite public comment on the

issues discussed above. If you comment

on these information collection and

recordkeeping requirements, please email comments to JBurke1@hcfa.gov

(Attn:HCFA–0149) or mail copies

directly to the following:

Health Care Financing Administration,

Office of Information Services,

Information Technology Investment

Management Group, Division of

HCFA Enterprise Standards, Room

C2–26–17, 7500 Security Boulevard,

Baltimore, MD 21244–1850. Attn:

John Burke HCFA–0149

and

Office of Information and Regulatory

Affairs, Office of Management and

Budget, Room 10235, New Executive

Office Building, Washington, DC

20503, Attn: Allison Herron Eydt,

HCFA Desk Officer.

VI. Response to Comments

Because of the large number of items

of correspondence we normally receive

on Federal Register documents

published for comment, we are not able

to acknowledge or respond to them

individually. We will consider all

comments we receive by the date and

time specified in the DATES section of

this preamble, and, if we proceed with

a subsequent document, we will

respond to comments in the preamble to

that document.

VII. Impact Analysis

As the effect of any one standard is

affected by the implementation of other

standards, it can be misleading to

discuss the impact of one standard by

itself. Therefore, we did an impact

analysis on the total effect of all the

standards in the proposed rule

concerning the national provider

identifier (HCFA–0045–P), which can be

found elsewhere in this Federal

Register.

We intend to publish in each

proposed rule an impact analysis that is

specific to the standard or standards

proposed in that rule, but the impact

analysis will assess only the relative

cost impact of implementing a given

standard. Thus, the following

discussion contains the impact analysis

for each of the transactions proposed in

this rule. As stated in the general impact

analysis in HCFA–0045–P, we do not

intend to associate costs and savings to

specific standards.

Although we cannot determine the

specific economic impact of the

standards being proposed in this rule

(and individually each standard may

not have a significant impact), the

overall impact analysis makes clear that,

collectively, all the standards will have

a significant impact of over $100 million

on the economy. Also, while each

standard may not have a significant

impact on a substantial number of small

entities, the combined effects of all the

proposed standards may have a

significant effect on a substantial

number of small entities. Therefore, the

following impact analysis should be

read in conjunction with the overall

impact analysis.

In accordance with the provisions of

Executive Order 12866, this proposed

rule was reviewed by the Office of

Management and Budget.

Guiding Principles for Standard

Selection

The implementation teams charged

with designating standards under the

statute have defined, with significant

input from the health care industry, a

set of common criteria for evaluating

potential standards. These criteria are

based on direct specifications in the

HIPAA, the purpose of the law, and

principles that support the regulatory

philosophy set forth in Executive Order

12866 of September 30, 1993, and the

Paperwork Reduction Act of 1995. In

order to be designated as a standard, a

proposed standard should:

• Improve the efficiency and

effectiveness of the health care system

by leading to cost reductions for or

improvements in benefits from

electronic HIPAA health care

transactions. This principle supports the

regulatory goals of cost-effectiveness

and avoidance of burden.

• Meet the needs of the health data

standards user community, particularly

health care providers, health plans, and

health care clearinghouses. This

principle supports the regulatory goal of

cost-effectiveness.

• Be consistent and uniform with the

other HIPAA standards (that is, their

data element definitions and codes and

their privacy and security requirements)

and, secondarily, with other private and

public sector health data standards. This

principle supports the regulatory goals

of consistency and avoidance of

incompatibility, and it establishes a

performance objective for the standard.

• Have low additional development

and implementation costs relative to the

benefits of using the standard. This

principle supports the regulatory goals

of cost-effectiveness and avoidance of

burden.

• Be supported by an ANSIaccredited standards developing

organization or other private or public

organization that would ensure

continuity and efficient updating of the

standard over time. This principle

supports the regulatory goal of

predictability.

• Have timely development, testing,

implementation, and updating

procedures to achieve administrative

simplification benefits faster. This

principle establishes a performance

objective for the standard.

• Be technologically independent of

the computer platforms and

transmission protocols used in HIPAA

health transactions, except when they

are explicitly part of the standard. This

principle establishes a performance

objective for the standard and supports

the regulatory goal of flexibility.

• Be precise and unambiguous but as

simple as possible. This principle

supports the regulatory goals of

predictability and simplicity.

• Keep data collection and paperwork

burdens on users as low as is feasible.

This principle supports the regulatory

goals of cost-effectiveness and

avoidance of duplication and burden.

• Incorporate flexibility to adapt more

easily to changes in the health care

infrastructure (such as new services,

organizations, and provider types) and

information technology. This principle
Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules 25301

supports the regulatory goals of

flexibility and encouragement of

innovation.

General

The effect of implementing standards

on health care clearinghouses is

basically the same for all the standards.

Currently, health care clearinghouses

receive and transmit various

transactions using a variety of formats.

The implementation of standard

transactions may reduce the variability

in the data received from some groups,

such as health care providers. The

implementation of any standard will

require some one-time changes to health

care clearinghouse systems. Health care

clearinghouses should be able to make

modifications that meet the deadlines

specified in the legislation, but some

temporary disruption of processing

could result. Once the transition is

made, health care clearinghouses may

have less ongoing system maintenance.

Costs may vary according to the

complexity of the standard, but costs

may be recouped from customers.

Health care clearinghouses would face

impacts (both positive and negative)

similar to those experienced by health

plans (which we discuss in more detail

in the discussions for specific

transactions). However, implementation

would likely be more complex, because

health care clearinghouses deal with

many health care providers and health

plans and may have to accommodate

additional nonstandard formats (in

addition to those formats they currently

support), as well as standards we adopt.

(The additional nonstandard formats

would be from those health care

providers that choose to stop submitting

directly to an insurer and submit

through a health care clearinghouse.)

This would also mean increased

business for the health care

clearinghouse.

Converting to any standard will result

in one-time conversion costs for health

care providers, health care

clearinghouses, and health plans as

well. Some health care providers and

health plans would incur those costs

directly and others may incur them in

the form of a fee from health care

clearinghouses or, for health care

providers, other agents.

Each standard compares favorably

with typical ASC X12 standards in

terms of complexity and ease of use. No

one in the ASC X12 subcommittee

assumes that every entity that sends or

receives an ASC X12 transaction has

reprogrammed its information systems

in order to do so. Every transaction is

designed, and the technical review

process assures, that it will be

compatible with the commercial, offthe-shelf translator programs that are

widely available in the United States.

These translators significantly reduce

the cost and complexity of achieving

and maintaining compliance with all

ASC X12 standards. Universal

communication with all parties in the

health care industry is thus assured.

Specific technology limitations of

existing systems could affect the

complexity of conversion. Also, some

existing health care provider systems

may not have the resources to house a

translator to convert from one format to

another.

Following is the portion of the impact

analysis that relates specifically to the

standards that are the subject of this

regulation.

A. Code Sets—Specific Impact of

Adoption of Code Sets for Medical Data

Affected Entities

Standard codes and classifications are

required in some segments of

administrative and financial

transactions. Those that create and

process administrative transactions

must implement the standard codes

according to the official implementation

guides designated for each coding

system and each transaction. Those that

receive standard electronic

administrative transactions must be able

to receive and process all standard

codes (and modifiers, in the cases of

HCPCS and CPT), irrespective of local

policies regarding reimbursement for

certain conditions or procedures,

coverage policies, or need for certain

types of information that are part of a

standard transaction.

The adoption of standard code sets

and coding guidelines for medical data

supports the regulatory goals of costeffectiveness and the avoidance of

duplication and burden. The code sets

that are being proposed as initial HIPAA

standards are all de facto standards

already in use by most health plans,

health care clearinghouses, and health

care providers.

Health care providers currently use

the recommended code set for reporting

diagnoses and one or more of the

recommended procedure coding

systems for reporting procedures/

services. Since health plans can differ

on the codes they accept, many health

care providers use different coding

guidelines for dealing with different

health plans, sometimes for the same

patient. (Anecdotal information leads us

to believe that use of other codes is

widespread, but we cannot quantify the

number.) Some of these differences

reflect variations in covered services

that will continue to exist irrespective of

data standardization. Others reflect

differences in a health plan’s ability to

accept as valid a claim that may include

more information than is needed or

used by that health plan. The

requirement to use standard coding

guidelines will eliminate this latter

category of differences and should

simplify claims submission for health

care providers that deal with multiple

health plans.

Currently, there are health plans that

do not adhere to official coding

guidelines and have developed their

own plan-specific guidelines for use

with the standard code sets, which do

not permit the use of all valid codes.

(Again, we cannot quantify how many

health plans do this, but we are aware

of some instances.) When the HIPAA

code set standards become effective,

these health plans would have to

receive and process all standard codes,

irrespective of local policies regarding

reimbursement for certain conditions or

procedures, coverage policies, or need

for certain types of information that are

part of a standard transaction.

We believe that there is significant

variation in the reporting of anesthesia

services, with some health plans using

the anesthesia section of CPT and others

requiring the anesthesiologist or nurse

anesthetist to report the code for the

surgical procedure itself. When the

HIPAA code sets become effective,

health plans following the latter

convention will have to begin accepting

codes from the anesthesia section.

We note that by adopting standards

for code sets we are requiring that all

parties accept these codes within their

electronic transactions. We are not

requiring payment for all these services.

Those health plans that do not adhere

to official coding guidelines must

therefore undertake a one-time effort to

modify their systems to accept all valid

codes in the standard code sets or

engage a health care clearinghouse to

preprocess the standard claims data for

them. Health plans should be able to

make modifications to meet the

deadlines specified in the legislation,

but some temporary disruption of

claims processing could result.

There may be some temporary

disruption of claims processing as

health plans and health care

clearinghouses modify their systems to

accept all valid codes in the standard

code sets.
25302 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

B. Transaction Standards

1. Specific Impact of Adoption of the

National Council of Prescription Drug

Programs (NCPDP) Telecommunication

Claim

a. Affected Entities

Health care providers that submit

retail pharmacy claims, and health care

plans that process retail pharmacy

claims, currently use the NCPDP format.

The NCPDP claim and equivalent

encounter is used either in on-line

interactive or batch mode. Since all

pharmacy health care providers and

health plans use the NCPDP claim

format, there are no specific impacts to

health care providers.

b. Effects of Various Options

The NCPDP format met all the

principles and there are no known

options for a standard retail pharmacy

claim transaction.

2. Specific Impact of Adoption of the

ASC X12N 837 for Submission of

Institutional Health Care Claims,

Professional Health Care Claims, Dental

Claims, and Coordination of Benefits

a. Affected Entities

All health care providers and health

plans that conduct EDI directly and use

other electronic format(s), and all health

care providers that decide to change

from a paper format to an electronic

one, would have to begin to use the ASC

X12N 837 for submitting electronic

health care claims (hospital, physician/

supplier and dental). (Currently, about 3

percent of Medicare providers use this

standard for claims; it is used less for

non-Medicare claims.)

There would be a potential for

disruption of claims processes and

timely payments during a particular

health plan’s transition to the ASC

X12N 837. Some health care providers

could react adversely to the increased

cost and revert to submitting hard copy

claims.

After implementation, health care

providers would no longer have to keep

track of and use different electronic

formats for different insurers. This

would simplify provider billing systems

and processes and reduce

administrative expenses.

Health plans would be able to

schedule their implementation of the

ASC X12N 837 in a manner that best fits

their needs, thus allaying some costs

(through coordination of conversion to

other standards) as long as they meet the

deadlines specified in the legislation.

Although the costs of implementing the

ASC X12N 837 are generally one-time

costs related to conversion, the systems

upgrades for some smaller health care

providers, health plans, and health care

clearinghouses may be cost prohibitive.

Health care providers and health plans

have the option of using a

clearinghouse.

The cost may also cause some smaller

health plans that have trading partner

agreements today to discontinue that

partnership. That same audience of

health care providers, health care

clearinghouses, and health plans could

conceivably be forced out of the

partnerships of transmitting and

accepting claims data. In these instances

patients may be affected, in that,

without trading partner agreements for

electronic crossover of claims data for

the processing of the supplemental

benefit, the patient may be responsible

for filing his or her own supplemental

claims that are filed electronically

today.

Coordination of Benefits

Once the ASC X12N 837 has been

implemented, health plans that perform

coordination of benefits would be able

to eliminate support of multiple

proprietary electronic claim formats,

thus simplifying claims receipt and

processing as well as reducing

administrative costs. Coordination of

benefits activities would also be greatly

simplified because all health plans

would use the same standard format.

There is no doubt that standardization

in coordination of benefits will greatly

enhance and improve efficiency in the

overall claims process and the

coordination of benefits.

From a nonsystems perspective, we

do not foresee an impact to the

coordination of benefits process. The

COB transaction will continue to consist

of the incoming electronic claim and the

data elements provided on a remittance

advice. Standardization in the

coordination of benefits process will

clearly increase efficiency in the

electronic processes utilized by the

health care providers, health care

clearinghouses, and health plans as they

work with standardized codes and

processes.

b. Effects of Various Options

We assessed the various options for a

standard claim transaction against the

principles, listed at the beginning of this

impact analysis above, with the overall

goal of achieving the maximum benefit

for the least cost. We found that the ASC

X12N 837 for institutional claims,

professional claims, dental claims, and

coordination of benefits met all the

principles, but no other candidate

standard transaction met all the

principles.

Since the majority of dental claims are

submitted on paper and those submitted

electronically are being transmitted

using a variety of proprietary formats,

the only viable choice of a standard is

the ASC X12N 837. The American

Dental Association (ADA) also

recommended the ASC X12N 837 for

the dental claim standard.

The ASC X12N 837 was selected as

the standard for the professional

(physician/supplier) claim because it

met the principles above. The only other

candidate standard, the National

Standard Format, was developed

primarily by HCFA for Medicare claims.

While it is widely used, it is not always

used in a standard manner. Many

variations of the National Standard

Format are in use. The NUCC, the AMA,

and WEDI recommended the ASC X12N

837 for the professional claim standard.

The ASC X12N 837 was selected as

the standard for the institutional

(hospital) claim because it met the

principles above. The only other

candidate standard is the UB–92

Format. While it is widely used, it is not

always used in a standard manner.

The selection of the ASC X12N 837

does not impose a greater burden on the

industry than the nonselected options

because the nonselected formats are not

used in a standard manner by the

industry and they do not incorporate

flexibility in order to adapt easily to

change. The ASC X12N 837 presents

significant advantages in terms of

universality and flexibility.

3. Specific Impact of Adoption of the

ASC X12N 835 for Receipt of Health

Care Remittance

a. Affected Entities

Health care providers that conduct

EDI with health plans and do not wish

to change their internal systems would

have to convert the ASC X12N 835

transactions received from health plans

into a format compatible with their

internal systems. Health plans that want

to transmit remittance advice directly to

health care providers and that do not

use the ASC X12N 835 would also incur

costs to convert. Many health care

providers and health plans do not use

this standard at this time. (We do not

have information to quantify the

standard’s use outside the Medicare

program. However, in 1996, 15.9

percent of part B health care providers

and 99.4 percent of part A health care

providers were able to receive this

standard. All Medicare contractors must

be able to send the standard.)

There would be a potential for the

delay in payment or the issuance of

electronic remittance advice
Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules 25303

transactions during a particular health

plan’s transition to the ASC X12N 835.

Some health care providers could react

adversely to the increased cost and

revert to use of hard copy remittance

advice notices in lieu of an electronic

transmission.

After implementation, health care

providers would no longer have to keep

track of or accept different electronic

payment/remittance advice formats

issued by different health care payers.

This would simplify automatic posting

of all electronic payment/remittance

advice data, reducing administrative

expenses. This would also reduce or

eliminate the practice of posting

payment/remittance advice data

manually from hard copy notices, again

reducing administrative expenses. Most

manual posting occurs currently in

response to the problem of multiple

formats, which the standard would

eliminate.

Once the ASC X12N 835 has been

implemented, health plans’

coordination of benefits activities,

which would use the ASC X12N 837

format supplemented with limited data

from the ASC X12N 835, would be

greatly simplified because all health

plans would use the same standard

format.

Health plans would be able to

schedule their implementation of the

ASC X12N 835 in a manner that best fits

their needs, thus allaying some costs

(through coordination of conversion to

other standards), as long as they meet

the deadlines specified in the

legislation.

The selection of the ASC X12N 835

does not impose a greater burden on the

industry than the nonselected option

because the nonselected formats are not

used in a standard manner by the

industry and they do not incorporate

flexibility in order to adapt easily to

change. The ASC X12N 835 presents

significant advantages in terms of

universality and flexibility.

b. Effects of Various Options

We assessed the various options for a

standard payment/remittance advice

transaction against the principles listed

above, with the overall goal of achieving

the maximum benefit for the least cost.

We found that the ASC X12N 835 met

all the principles, but no other

candidate standard transaction met all

the principles, or even those principles

supporting the regulatory goal of costeffectiveness.

The ASC X12N 835 was selected as it

met the principles above. The only other

candidate standard, the ASC X12N 820,

was not selected because, although it

was developed for payment

transactions, it was not developed for

health care payment purposes. The ASC

X12N subcommittee itself recognized

this in its decision to develop the ASC

X12N 835.

4. Specific Impact of Adoption of the

ASC X12N 276/277 for Health Care

Claim Status/Response

a. Affected Entities

Most health care providers that are

currently using an electronic format (of

which there are currently very few) and

that wish to request claim status

electronically using the ASC X12N 276/

277 will incur conversion costs. We

cannot quantify the number of health

care providers that would have to

convert to the proposed standard, but

we do know that no Medicare

contractors use it; thus, we assume that

few health care providers are able to use

it at this time.

After implementation, health care

providers would be able to request and

receive the status of claims in one

standard format, from all health care

plans. This would eliminate their need

to maintain redundant software and

would make electronic claim status

requests and receipt of responses

feasible for small providers, eliminating

their need to manually send and review

claim status requests and responses.

Health care plans that do not

currently directly accept electronic

claim status requests and do not directly

send electronic claims status responses

would have to modify their systems to

accept the ASC X12N 276 and to send

the ASC X12N 277. No disruptions in

claims processing or payment would

occur.

After implementation, health care

plans would be able to submit claim

status responses in one standard format

to all health care providers.

Administrative costs incurred by

supporting multiple formats and

manually responding to claim status

requests would be greatly reduced.

b. Effects of Various Options

There are no known options for a

standard claims status and response

transaction.

5. Specific Impact of Adoption of the

ASC X12N 834 for Enrollment and

Disenrollment in a Health Plan

a. Affected Entities

The ASC X12N 834 may be used by

an employer or other sponsor to

electronically enroll or disenroll its

subscribers into or out of a health plan.

Currently, most small and medium size

employers and other sponsors conduct

their subscriber enrollments using paper

forms. (We cannot quantify how many

of these sponsors use paper forms, but

anecdotal information indicates that

most use paper.) We understand that

large employers and other sponsors are

more likely to conduct subscriber

enrollment transactions electronically

because of the many changes that occur

in a large workforce; for example,

hirings, firings, retirements, marriages,

births, and deaths, to name a few. To do

this, the large employers must use the

proprietary electronic data interchange

formats that differ among health plans.

Nonetheless, it is our understanding,

based on anecdotal information, that

health plans still use paper to conduct

most of their enrollment transactions.

We expect that the impact of the ASC

X12N 834 transaction standard would

differ, at least in the beginning,

according to the current use of

electronic transactions. As stated earlier,

most small and medium size employers

and other sponsors do not use electronic

transactions currently and would

therefore experience little immediate

impact from adoption of the ASC X12N

834 transaction. The ASC X12N 834

would offer large employers that

currently conduct enrollment

transactions electronically the

opportunity to shift to a single standard

format. A single standard will be most

attractive to those large employers that

offer their subscribers choices among

multiple health plans. Thus, we expect

that the early benefits of the ASC X12N

834 would accrue to large employers

and other sponsors that would be able

to eliminate redundant hardware,

software, and human resources required

to support multiple proprietary

electronic data interchange formats. In

the long run, we expect that the

standards would lower the cost of

conducting enrollment transactions and

make it possible for small and medium

size companies to convert from paper to

electronic transactions and achieve

significant additional savings.

Overall, employers and other

sponsors, and the health plans with

which they deal, stand to benefit from

adoption of the ASC X12N 834 and

electronic data interchange. The ASC

X12N 834 and electronic data

interchange would facilitate the

performance of enrollment and

disenrollment functions. Further, the

ASC X12N 834 supports detailed

enrollment information on the

subscriber’s dependents, which is often

lacking in current practice. Ultimately,

reductions in administrative overhead

may be passed along in lower premiums

to subscribers and their dependents.

We invite commenters to provide us

with data on the extent to which
25304 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

employers and other sponsors conduct

their health plan enrollments using

paper proprietary formats rather than

the ASC X12N 834 electronic data

interchange standards.

b. Effects of Various Options

The only other option, the NCPDP

Member Enrollment Standard, does not

meet the selection criteria and would

not be implementable.

6. Specific Impact of Adoption of the

ASC X12N 270/271 for Eligibility for a

Health Plan

a. Affected Entities

The ASC X12N 270/271 transaction

may be used by a health care provider

to electronically request and receive

eligibility information from a health

care plan prior to providing or billing

for a health care service. Many health

care providers routinely verify health

insurance coverage and benefit

limitations prior to providing treatment

or before preparing claims for

submission to the insured patient and

his or her health plan. Currently, health

care providers secure most of these

eligibility determinations through

telephone calls, proprietary point of sale

terminals, or using proprietary

electronic formats that differ from

health plan to health plan. Since many

health care providers participate in

multiple health plans, these health care

providers must maintain redundant

software, hardware, and human

resources to obtain eligibility

information. This process is inefficient,

often burdensome, and takes valuable

time that could otherwise be devoted to

patient care.

We believe that the lack of a health

care industry standard may have

imposed a cost barrier to the widespread

use of electronic data interchange. The

ASC X12N 270/271 is used widely, but

not exclusively, by health care plans

and health care providers. This may be

due, in part, to the lack of an industrywide implementation guide for these

transactions in health care. We expect

that adoption of the ASC X12N 270/271

and its implementation guide would

lower the cost of using electronic

eligibility verifications. This would

benefit health care providers that can

move to a single standard format and,

for the first time, make electronic data

interchange feasible for small health

plans and health care providers that rely

currently on the telephone, paper forms,

or proprietary point of sale terminals

and software.

b. Effect of Various Options

There were two other options, the

ASC X12N IHCEBI, and its companion,

IHCEBR, and the NCPDP

Telecommunications Standard Format.

None of these meet the selection criteria

and thus they would not be

implementable.

7. Specific Impact of Adoption of the

ASC X12N 820 for Payroll Deducted and

Other Group Premium Payment for

Insurance Product

a. Affected Entities

The ASC X12N 820 may be used by

an employer or sponsor to electronically

transmit a remittance notice to

accompany a payment for health

insurance premiums in response to a

bill from the health plan. Payment may

be in the form of a paper check or an

electronic funds transfer transaction.

The ASC X12N 820 can be sent with

electronic funds transfer instructions

that are routed directly to the Federal

Reserve System’s automated health care

clearinghouses or with payments

generated directly by the employer’s or

other sponsor’s bank. The ASC X12 820

transaction is very widely used by many

industries (manufacturing, for instance)

and government agencies (Department

of Defense) in addition to the insurance

industry in general. However, the ASC

X12N 820 is not widely used in the

health insurance industry and is not

widely used by employers and other

sponsors to make premium payments to

their health insurers. This may be due,

in part, to the lack of an implementation

guide specifically for health insurance.

Currently, most payment transactions

are conducted on paper, and those that

are conducted electronically use

proprietary electronic data interchange

standards that differ across health plans.

(We cannot quantify how many of these

transactions are conducted on paper,

but anecdotal information suggests that

most are.) We believe that the lack of a

health care industry standard may have

imposed a cost barrier to the use of

electronic data interchange; larger

employers and other sponsors, that

often transact business with multiple

health plans, need to retain redundant

hardware, software, and human

resources to support multiple

proprietary electronic premium

payment standards. We expect that

adoption of national standards will

lower the cost of using electronic

premium payments. This will benefit

large employers that can move to a

single standard format, and, for the first

time, will make electronic transmissions

of premium payments feasible for

smaller employers and other sponsors

whose payment transactions today are

performed almost exclusively using

paper.

At some point, an organization’s size

and complexity will require it to

consider switching its business

transactions from paper to electronic.

The ASC X12N 820 would facilitate that

by eliminating redundant proprietary

formats that are certain to crop up when

there are no widely accepted standards.

By eliminating the software, hardware,

and human resources associated with

redundancy, a business may reach the

point where it becomes cost beneficial

to convert from paper to electronic

transactions. Those other sponsors and

health care plans that already support

more than one proprietary format would

incur some additional expense in the

conversion to the standard, but they

would enjoy longer term savings that

result from eliminating the

redundancies.

We invite comments on the extent to

which employers and other sponsors

conduct their health plan premium

payments using paper versus

proprietary formats, compared to the

ASC X12N 820 electronic data

interchange standards.

b. Effects of Various Options

There are no known options for

premium payment transactions.

8. Specific Impact of Adoption of ASC

X12N 278 for Referral Certification and

Authorization

a. Affected Entities

The ASC X12N 278 may be used by

a health care provider to request and

receive approval from a health plan

through an electronic transaction prior

to providing a health care service. Prior

approvals have become standard

operating procedure for most hospitals,

physicians and other health care

providers due to the rapid growth of

managed care. Health care providers

secure most of their prior approvals

through telephone calls, paper forms or

proprietary electronic formats that differ

from health plan to health plan. Since

many health care providers participate

in multiple managed care plans, they

must devote redundant software,

hardware, and human resources to

obtaining prior authorization. This

process is often untimely and

inefficient.

We believe that the lack of a health

care industry standard may have

imposed a cost barrier to the widespread

use of electronic data interchange. The

ASC X12N 278 is not widely used by

health care plans and health care

providers, which may be due, in part, to

the lack of an industry-wide

implementation guide for it. We expect

that adoption of ASC X12N 278 and its
Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules 25305

implementation guide would lower the

cost of using electronic prior

authorizations. This would benefit

health care providers that can move to

a single standard format and, for the

first time, make electronic data

interchange feasible for smaller health

plans and health care providers that

perform these transactions almost

exclusively using the telephone or

paper.

At some point, an organization’s size

and complexity will require it to

consider switching its business

transactions from paper to electronic.

The ASC X12N 278 would facilitate that

by eliminating redundant proprietary

formats that are certain to crop up when

there are no widely accepted standards.

By eliminating the software, hardware,

and human resources associated with

redundancy, a business may reach the

point where it becomes cost beneficial

to convert from paper to electronic

transactions. Health care plans and

health care providers that already

support more than one proprietary

format would incur some additional

expense in the conversion to the

standard but would enjoy longer term

savings that result from eliminating the

redundancies.

b. Effects of Various Options

There are no known options for

referral and certification authorization

transactions.

List of Subjects in 45 CFR Part 142

Administrative practice and

procedure, Health facilities, Health

insurance, Hospitals, Incorporation by

reference, Medicare, Medicaid.

Accordingly, 45 CFR subtitle A,

subchapter B, would be amended by

adding Part 142 to read as follows:

Note to Reader: This proposed rule and

another proposed rule found elsewhere in

this Federal Register are two of several

proposed rules that are being published to

implement the administrative simplification

provisions of the Health Insurance Portability

and Accountability Act of 1996. We propose

to establish a new 45 CFR Part 142. Proposed

Subpart A—General Provisions is exactly the

same in each rule unless we have added new

sections or definitions to incorporate

additional general information. The subparts

that follow relate to the specific provisions

announced separately in each proposed rule.

When we publish the first final rule, each

subsequent final rule will revise or add to the

text that is set out in the first final rule.

PART 142—ADMINISTRATIVE

REQUIREMENTS

Subpart A—General Provisions

Sec.

142.101 Statutory basis and purpose.

142.102 Applicability.

142.103 Definitions.

142.104 General requirements for health

plans.

142.105 Compliance using a health care

clearinghouse.

142.106 Effective dates of a modification to

a standard or implementation

specification.

142.110 Availability of implementation

guides.

Subparts B–I—[Reserved]

Subpart J—Code Sets

142.1002 Medical data code sets.

142.1004 Code sets for nonmedical data

elements.

142.1010 Effective dates of the initial

implementation of code sets.

Subpart K—Health Claims or Equivalent

Encounter Information

142.1102 Standards for health claims or

equivalent encounter information.

142.1104 Requirements: Health plans.

142.1106 Requirements: Health care

clearinghouses.

142.1108 Requirements: Health care

providers.

142.1110 Effective dates of the initial

implementation of the health claim or

equivalent encounter information.

Subpart L—Health Claims and Remittance

Advice

142.1202 Standard for health claims and

remittance advice.

142.1204 Requirements: Health plans.

144.1206 Requirements: Health care

clearinghouses.

142.1210 Effective dates of the initial

implementation of the health claims and

remittance advice.

Subpart M—Coordination of Benefits

142.1302 Standard for coordination of

benefits.

142.1304 Requirements: Health plans.

144.1306 Requirements: Health care

clearinghouses.

142.1308 Effective dates of the initial

implementation of the standard for

coordination of benefits.

Subpart N—Health Claim Status

142.1402 Standard for health claim status.

142.1404 Requirements: Health plans.

144.1406 Requirements: Health care

clearinghouses.

142.1408 Requirements: Health care

providers.

142.1410 Effective dates of the initial

implementation of the standard for

health claims status.

Subpart O—Enrollment and Disenrollment

in a Health Plan

142.1502 Standard for enrollment and

disenrollment in a health plan.

142.1504 Requirements: Health plans.

144.1506 Requirements: Health care

clearinghouses.

142.1508 Effective dates of the initial

implementation of the standard for

enrollment and disenrollment in a health

plan.

Subpart P—Eligibility for a Health Plan

142.1602 Standard for eligibility for a

health plan.

142.1604 Requirements: Health plans.

144.1606 Requirements: Health care

clearinghouses.

142.1608 Requirements: Health care

providers.

142.1610 Effective dates of the initial

implementation of the standard for

eligibility for a health plan.

Subpart Q—Health Plan Premium Payments

142.1702 Standard for health plan premium

payments.

142.1704 Requirements: Health plans.

144.1706 Requirements: Health care

clearinghouses.

142.1708 Effective dates of the initial

implementation of the standard for

health plan premium payments.

Subpart R—Referral Certification and

Authorization

142.1802 Referral certification and

authorization.

142.1804 Requirements: Health plans.

144.1806 Requirements: Health care

clearinghouses.

142.1808 Requirements: Health care

providers.

142.1810 Effective dates of the initial

implementation of the standard for

referral certifications and authorizations.

Authority: Sections 1173 and 1175 of the

Social Security Act (42 U.S.C. 1320d–2 and

1320d–4)

Subpart A—General Provisions

§ 142.101 Statutory basis and purpose.

Sections 1171 through 1179 of the

Social Security Act, as added by section

262 of the Health Insurance Portability

and Accountability Act of 1996, require

HHS to adopt national standards for the

electronic exchange of health

information in the health information

system. The purpose of these sections is

to promote administrative

simplification.

§ 142.102 Applicability.

(a) The standards adopted or

designated under this part apply, in

whole or in part, to the following:

(1) A health plan.

(2) A health care clearinghouse when

doing the following:

(i) Transmitting a standard transaction

(as defined in § 142.103) to a health care

provider or health plan.

(ii) Receiving a standard transaction

from a health care provider or health

plan.

(iii) Transmitting and receiving the

standard transactions when interacting

with another health care clearinghouse.

(3) A health care provider when

transmitting an electronic transaction as

defined in § 142.103.

(b) Means of compliance are stated in

greater detail in § 142.105.
25306 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

§ 142.103 Definitions.

For purposes of this part, the

following definitions apply:

ASC X12 stands for the Accredited

Standards Committee chartered by the

American National Standards Institute

to design national electronic standards

for a wide range of business

applications.

ASC X12N stands for the ASC X12

subcommittee chartered to develop

electronic standards specific to the

insurance industry.

Code set means any set of codes used

for encoding data elements, such as

tables of terms, medical concepts,

medical diagnostic codes, or medical

procedure codes.

Health care clearinghouse means a

public or private entity that processes or

facilitates the processing of nonstandard

data elements of health information into

standard data elements. The entity

receives transactions from health care

providers, health plans, other entities,

or other clearinghouses, translates the

data from a given format into one

acceptable to the intended recipient,

and forwards the processed transaction

to the appropriate recipient. Billing

services, repricing companies,

community health management

information systems, community health

information systems, and ‘‘value-added’’

networks and switches are considered to

be health care clearinghouses for

purposes of this part.

Health care provider means a

provider of services as defined in

section 1861(u) of the Social Security

Act, a provider of medical or other

health services as defined in section

1861(s) of the Social Security Act, and

any other person who furnishes or bills

and is paid for health care services or

supplies in the normal course of

business.

Health information means any

information, whether oral or recorded in

any form or medium, that—

(1) Is created or received by a health

care provider, health plan, public health

authority, employer, life insurer, school

or university, or health care

clearinghouse; and

(2) Relates to the past, present, or

future physical or mental health or

condition of an individual, the

provision of health care to an

individual, or the past, present, or

future payment for the provision of

health care to an individual.

Health plan means an individual or

group plan that provides, or pays the

cost of, medical care. Health plan

includes the following, singly or in

combination:

(1) Group health plan. A group health

plan is an employee welfare benefit plan

(as currently defined in section 3(l) of

the Employee Retirement Income and

Security Act of 1974 (29 U.S.C. 1002(l)),

including insured and self-insured

plans, to the extent that the plan

provides medical care, including items

and services paid for as medical care, to

employees or their dependents directly

or through insurance, or otherwise, and

(i) Has 50 or more participants; or

(ii) Is administered by an entity other

than the employer that established and

maintains the plan.

(2) Health insurance issuer. A health

insurance issuer is an insurance

company, insurance service, or

insurance organization that is licensed

to engage in the business of insurance

in a State and is subject to State law that

regulates insurance.

(3) Health maintenance organization.

A health maintenance organization is a

Federally qualified health maintenance

organization, an organization recognized

as a health maintenance organization

under State law, or a similar

organization regulated for solvency

under State law in the same manner and

to the same extent as such a health

maintenance organization.

(4) Part A or Part B of the Medicare

program under title XVIII of the Social

Security Act.

(5) The Medicaid program under title

XIX of the Social Security Act.

(6) A Medicare supplemental policy

(as defined in section 1882(g)(1) of the

Social Security Act).

(7) A long-term care policy, including

a nursing home fixed-indemnity policy.

(8) An employee welfare benefit plan

or any other arrangement that is

established or maintained for the

purpose of offering or providing health

benefits to the employees of two or more

employers.

(9) The health care program for active

military personnel under title 10 of the

United States Code.

(10) The veterans health care program

under 38 U.S.C., chapter 17.

(11) The Civilian Health and Medical

Program of the Uniformed Services

(CHAMPUS), as defined in 10 U.S.C.

1072(4).

(12) The Indian Health Service

program under the Indian Health Care

Improvement Act (25 U.S.C. 1601 et

seq.).

(13) The Federal Employees Health

Benefits Program under 5 U.S.C. chapter

89.

(14) Any other individual or group

health plan, or combination thereof, that

provides or pays for the cost of medical

care.

Medical care means the diagnosis,

cure, mitigation, treatment, or

prevention of disease, or amounts paid

for the purpose of affecting any body

structure or function of the body;

amounts paid for transportation

primarily for and essential to these

items; and amounts paid for insurance

covering the items and the

transportation specified in this

definition.

Participant means any employee or

former employee of an employer, or any

member or former member of an

employee organization, who is or may

become eligible to receive a benefit of

any type from an employee benefit plan

that covers employees of that employer

or members of such an organization, or

whose beneficiaries may be eligible to

receive any of these benefits.

‘‘Employee’’ includes an individual who

is treated as an employee under section

401(c)(1) of the Internal Revenue Code

of 1986 (26 U.S.C. 401(c)(1)).

Small health plan means a group

health plan or individual health plan

with fewer than 50 participants.

Standard means a set of rules for a set

of codes, data elements, transactions, or

identifiers promulgated either by an

organization accredited by the American

National Standards Institute or HHS for

the electronic transmission of health

information.

Transaction means the exchange of

information between two parties to

carry out financial and administrative

activities related to health care. It

includes the following:

(1) Transactions specified in section

1173(a)(2) of the Act, which are as

follows:

(i) Health claims or equivalent

encounter information.

(ii) Health care payment and

remittance advice.

(iii) Health claims status.

(iv) Enrollment and disenrollment in

a health plan.

(v) Eligibility for a health plan.

(vi) Health plan premium payments.

(vii) First report of injury.

(viii) Referral certification and

authorization.

(ix) Health claims attachments.

(2) Other transactions as the Secretary

may prescribe by regulation.

Coordination of benefits is a transaction

under this authority.

§ 142.104 General requirements for health

plans.

If a person conducts a transaction (as

defined in § 142.103) with a health plan

as a standard transaction, the following

apply:

(a) The health plan may not refuse to

conduct the transaction as standard

transaction.

(b) The health plan may not delay the

transaction or otherwise adversely
Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules 25307

affect, or attempt to adversely affect, the

person or the transaction on the basis

that the transaction is a standard

transaction.

(c) The health information transmitted

and received in connection with the

transaction must be in the form of

standard data elements of health

information.

(d) A health plan that conducts

transactions through an agent must

assure that the agent meets all the

requirements of this part that apply to

the health plan.

§ 142.105 Compliance using a health care

clearinghouse.

(a) Any person or other entity subject

to the requirements of this part may

meet the requirements to accept and

transmit standard transactions by

either—

(1) Transmitting and receiving

standard data elements, or

(2) Submitting nonstandard data

elements to a health care clearinghouse

for processing into standard data

elements and transmission by the health

care clearinghouse and receiving

standard data elements through the

health care clearinghouse.

(b) The transmission, under contract,

of nonstandard data elements between a

health plan or a health care provider

and its agent health care clearinghouse

is not a violation of the requirements of

this part.

§ 142.106 Effective dates of a modification

to a standard or implementation

specification.

If HHS adopts a modification to a

standard or implementation

specification, the implementation date

of the modified standard or

implementation specification may be no

earlier than 180 days following the

adoption of the modification. HHS

determines the actual date, taking into

account the time needed to comply due

to the nature and extent of the

modification. HHS may extend the time

for compliance for small health plans.

§ 142.110 Availability of implementation

guides.

The implementation guides specified

in subparts K through R of this part are

available as set forth in paragraphs (a)

through (c) of this section. Entities

requesting copies or access for

inspection must specify the standard by

name, number, and version.

(a) The implementation guides for

ASC X12 standards may be obtained

from the Washington Publishing

Company, 806 W. Diamond Ave., Suite

400, Gaithersburg, MD, 20878;

telephone 301–590–9337; and FAX:

301–869–9460. They are also available,

at no cost, through the Washington

Publishing Company on the Internet at

http://www.wpc-edi.com/hipaa/.

(b) The implementation guide for

pharmacy claims may be obtained from

the National Council for Prescription

Drug Programs, 4201 North 24th Street,

Suite 365, Phoenix, AZ, 85016;

telephone 602–957–9105; and FAX 602–

955–0749. It may also be obtained

through the Internet at http://

www.ncpdp.org.

(c) A copy of the guides may be

inspected at the Office of the Federal

Register, 800 North Capitol Street, NW.,

Suite 700, Washington, DC and at the

Health Care Financing Administration.

Subparts B–I—[Reserved]

Subpart J—Code Sets

§ 142.1002 Medical data code sets.

Health plans, health care

clearinghouses, and health care

providers must use on electronic

transactions the diagnostic and

procedure code sets as prescribed by

HHS. These code sets are published in

a notice in the Federal Register. The

implementation guides for the

transaction standards in part 142,

Subparts K through R specify which of

the standard medical data code sets are

to be used in individual data elements

within those transaction standards.

§ 142.1004 Code sets for nonmedical data

elements.

The code sets for nonmedical data

that must be used in a transaction

specified in subparts K through R of this

part are the code sets described in the

implementation guide for the

transaction standard.

§ 142.1010 Effective dates of the initial

implementation of code sets.

(a) Health plans. (1) Each health plan

that is not a small health plan must

comply with the requirements of

§§ 142.104, 142.1002, and 142.1004 by

(24 months after the effective date of the

final rule in the Federal Register).

(2) Each small health plan must

comply with the requirements of

§§ 142.104, 142.1002, and 142.1004 by

[36 months after the effective date of the

final rule in the Federal Register].

(b) Health care clearinghouses and

health care providers. Each health care

clearinghouse and health care provider

must begin to use the standards

specified in §§ 142.1002 and 142.1004

by (24 months after the effective date of

the final rule in the Federal Register).

Subpart K—Health Claims or

Equivalent Encounter Information

§ 142.1102 Standards for health claims or

equivalent encounter information.

The health claims or equivalent

encounter information standards that

must be used under this subpart are as

follows:

(a) For pharmacy claims, the NCPDP

Telecommunications Standard Format

Version 3.2 and equivalent Standard

Claims Billing Tape Format batch

implementation, version 2.0. The

Director of the Federal Register

approves this incorporation by reference

in accordance with 5 U.S.C. 552(a) and

1 CFR part 51. The guide is available at

the addresses specified in § 142.108(b)

and (c) of this part.

(b) The ASC X12N 837—Health Care

Claim: Dental, Version 4010,

Washington Publishing Company,

004010X097. The Director of the Federal

Register approves this incorporation by

reference in accordance with 5 U.S.C.

552(a) and 1 CFR part 51. The guide is

available at the addresses specified in

§ 142.108(a) and (c) of this part.

(c) The ASC X12N 837—Health Care

Claim: Professional, Version 4010,

Washington Publishing Company,

004010X098. The Director of the Federal

Register approves this incorporation by

reference in accordance with 5 U.S.C.

552(a) and 1 CFR part 51. The guide is

available at the addresses specified in

§ 142.108(a) and (c) of this part.

(d) The ASC X12N 837—Health Care

Claim—Institutional, Version 4010,

Washington Publishing Company,

004010X096. The Director of the Federal

Register approves this incorporation by

reference in accordance with 5 U.S.C.

552(a) and 1 CFR part 51. The guide is

available at the addresses specified in

§ 142.108(a) and (c) of this part.

§ 142.1104 Requirements: Health plans.

Each health plan must accept the

standard specified in § 142.1102 when

conducting transactions concerning

health claims and equivalent encounter

information.

§ 142.1106 Requirements: Health care

clearinghouses.

Each health care clearinghouse must

use the standard specified in § 142.1102

when accepting or transmitting health

claims or equivalent encounter

information transactions.

§ 142.1108 Requirements: Health care

providers.

Any health care provider that

transmits health claims or equivalent

encounter information electronically

must use the standard specified in

§ 142.1102.
25308 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

§ 142.1110 Effective dates of the initial

implementation of the health claim or

equivalent encounter information standard.

(a) Health plans. (1) Each health plan

that is not a small health plan must

comply with the requirements of

§§ 142.104 and 142.1104 by (24 months

after the effective date of the final rule

in the Federal Register).

(2) Each small health plan must

comply with the requirements of

§§ 142.104 and 142.1104 by (36 months

after the effective date of the final rule

in the Federal Register).

(b) Health care clearinghouses and

health care providers. Each health care

clearinghouse and health care provider

must begin to use the standard specified

in § 142.1102 by (24 months after the

effective date of the final rule in the

Federal Register).

Subpart L—Health Claims and

Remittance Advice

§ 142.1202 Standard for health claims and

remittance advice.

The standard for health claims and

remittance advice that must be used

under this subpart is the ASC X12N

835—Health Care Claim Payment/

Advice, Version 4010, Washington

Publishing Company, 004010X091. The

Director of the Federal Register

approves this incorporation by reference

in accordance with 5 U.S.C. 552(a) and

1 CFR part 51. The guide is available at

the addresses specified in § 142.108(a)

and (c) of this part.

§ 142.1204 Requirements: Health plans.

Each health plan must transmit the

standard specified in § 142.1202 when

conducting health claims and

remittance advice transactions.

§ 142.1206 Requirements: Health care

clearinghouses.

Each health care clearinghouse must

use the standard specified in § 142.1202

when accepting or transmitting health

claims and remittance advice.

§ 142.1210 Effective dates of the initial

implementation of the health claims and

remittance advice.

(a) Health plans. (1) Each health plan

that is not a small health plan must

comply with the requirements of

§§ 142.104 and 142.1204 by (24 months

after the effective date of the final rule

in the Federal Register).

(2) Each small health plan must

comply with the requirements of

§§ 142.104 and 142.1204 by (36 months

after the effective date of the final rule

in the Federal Register).

(b) Health care clearinghouses. Each

health care clearinghouse must begin to

use the standard specified in § 142.1204

by (24 months after the effective date of

the final rule in the Federal Register).

Subpart M—Coordination of Benefits

§ 142.1302 Standard for coordination of

benefits.

The coordination of benefits

information standards that must be used

under this subpart are as follows:

(a) For pharmacy claims, the NCPDP

Telecommunications Standard Format

Version 3.2 and equivalent Standard

Claims Billing Tape Format batch

implementation, version 2.0. The

Director of the Federal Register

approves this incorporation by reference

in accordance with 5 U.S.C. 552(a) and

1 CFR part 51. The guide is available at

the addresses specified in § 142.108(b)

and (c) of this part.

(b) For dental claims, the ASC X12N

837—Health Care Claim: Dental,

Version 4010, Washington Publishing

Company, 004010X097. The Director of

the Federal Register approves this

incorporation by reference in

accordance with 5 U.S.C. 552(a) and 1

CFR part 51. The guide is available at

the addresses specified in § 142.108(a)

and (c) of this part.

(c) For professional claims, the ASC

X12N 837—Health Care Claim:

Professional, Version 4010, Washington

Publishing Company, 004010X098. The

Director of the Federal Register

approves this incorporation by reference

in accordance with 5 U.S.C. 552(a) and

1 CFR part 51. The guide is available at

the addresses specified in § 142.108(a)

and (c) of this part.

(d) For institutional claims, the ASC

X12N 837—Health Care Claim—

Institutional, Version 4010, Washington

Publishing Company, 004010X096. The

Director of the Federal Register

approves this incorporation by reference

in accordance with 5 U.S.C. 552(a) and

1 CFR part 51. The guide is available at

the addresses specified in § 142.108(a)

and (c) of this part.

§ 142.1304 Requirements: Health plans.

Each health plan that performs

coordination of benefits must accept

and transmit the standard specified in

§ 142.1302 when accepting or

transmitting coordination of benefits

transactions.

§ 142.1306 Requirements: Health care

clearinghouses.

Each health care clearinghouse must

use the standard specified in § 142.1302

when accepting or transmitting

coordination of benefits transactions.

§ 142.1308 Effective dates of the initial

implementation of the standard for

coordination of benefits.

(a) Health plans. (1) Each health plan

that performs coordination of benefits

and is not a small health plan must

comply with the requirements of

§§ 142.104 and 142.1304 by (24 months

after the effective date of the final rule

in the Federal Register).

(2) Each small health plan that

performs coordination of benefits must

comply with the requirements of

§§ 142.104 and 142.1304 by (36 months

after the effective date of the final rule

in the Federal Register).

(b) Health care clearinghouses. Each

health care clearinghouse must begin to

use the standard specified in § 142.1302

by (24 months after the effective date of

the final rule in the Federal Register).

Subpart N—Health Claim Status

§ 142.1402 Standard for health claim

status.

The standard for health claim status

that must be used under this subpart is

the ASC X12N 276/277 Health Care

Claim Status Request and Response,

Version 4010, Washington Publishing

Company, 004010X093. The Director of

the Federal Register approves this

incorporation by reference in

accordance with 5 U.S.C. 552(a) and 1

CFR part 51. The guide is available at

the addresses specified in § 142.108(a)

and (c) of this part.

§ 142.1404 Requirements: Health plans.

Each health plan must accept and

transmit the standard specified in

§ 142.1402 when accepting or

transmitting health claim status in

transactions with health care providers.

§ 142.1406 Requirements: Health care

clearinghouses.

Each health care clearinghouse must

use the standard specified in § 142.1402

when accepting or transmitting health

claims status transactions.

§ 142.1408 Requirements: Health care

providers.

Any health care provider that

transmits or accepts health claims status

electronically must use the standard

specified in § 142.1402.

§ 142.1410 Effective dates of the initial

implementation of the standard for health

claims status.

(a) Health plans. (1) Each health plan

that is not a small health plan must

comply with the requirements of

§§ 142.104 and 142.1404 by (24 months

after the effective date of the final rule

in the Federal Register).

(2) Each small health plan must

comply with the requirements of
Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules 25309

§§ 142.104 and 142.1404 by (36 months

after the effective date of the final rule

in the Federal Register).

(b) Health care clearinghouses and

health care providers. Each health care

clearinghouse and health care provider

must begin to use the standard specified

in § 142.1402 by (24 months after the

effective date of the final rule in the

Federal Register).

Subpart O—Enrollment and

Disenrollment in a Health Plan

§ 142.1502 Standard for enrollment and

disenrollment in a health plan.

The standard for enrollment and

disenrollment in a health plan that must

be used under this subpart is the ASC

X12 834—Benefit Enrollment and

Maintenance, [date], Version 4010,

Washington Publishing Company,

(004010X095). The Director of the

Federal Register approves this

incorporation by reference in

accordance with 5 U.S.C. 552(a) and 1

CFR part 51. The guide is available at

the addresses specified in § 142.110(a)

and (c).

§ 142.1504 Requirements: Health plans.

Each health plan must accept the

standard specified in § 142.1502 when

accepting transactions for enrollment

and disenrollment in a health plan.

§ 142.1506 Requirements: Health care

clearinghouses.

Each health care clearinghouse must

use the standard specified in § 142.1502

when accepting or transmitting

transactions for enrollment and

disenrollment in a health plan.

§ 142.1508 Effective dates of the initial

implementation of the standard for

enrollment and disenrollment in a health

plan.

(a) Health plans. (1) Each health plan

that is not a small health plan must

comply with the requirements of

§§ 142.104 and 142.1504 by (24 months

after the effective date of the final rule

in the Federal Register).

(2) Each small health plan must

comply with the requirements of

§§ 142.104 and 142.1504 by (36 months

after the effective date of the final rule

in the Federal Register).

(b) Health care clearinghouses. Each

health care clearinghouse must begin to

use the standard specified in § 142.1502

by (24 months after the effective date of

the final rule in the Federal Register).

Subpart P—Eligibility for a Health Plan

§ 142.1602 Standard for eligibility for a

health plan.

The standard for eligibility for a

health plan transaction that must be

used under this subpart is ASC X12N

270—Health Care Eligibility Benefit

Inquiry and ASC X12N 271—Health

Care Eligibility Benefit Response, [date],

Version 4010, Washington Publishing

Company, (004010X092). The Director

of the Federal Register approves this

incorporation by reference in

accordance with 5 U.S.C. 552(a) and 1

CFR part 51. The guide is available at

the addresses specified in § 142.108(a)

and (c) of this part.

§ 142.1604 Requirements: Health plans.

Each health plan must accept and

transmit the standard specified in

§ 142.1602 when accepting or

transmitting transactions for eligibility

for a health plan.

§ 142.1606 Requirements: Health care

clearinghouses.

Each health care clearinghouse must

use the standard specified in § 142.1602

when accepting or transmitting

transactions for eligibility for a health

plan.

§ 142.1608 Requirements: Health care

providers.

Any health care provider that

transmits or receives transactions for

eligibility for a health plan

electronically must use the standard

specified in § 142.1602.

§ 142.1610 Effective dates of the initial

implementation of the standard for

eligibility for a health plan.

(a) Health plans. (1) Each health plan

that is not a small health plan must

comply with the requirements of

§§ 142.104 and 142.1604 by (24 months

after the effective date of the final rule

in the Federal Register).

(2) Each small health plan must

comply with the requirements of

§§ 142.104 and 142.1604 by (36 months

after the effective date of the final rule

in the Federal Register).

(b) Health care clearinghouses and

health care providers. Each health care

clearinghouse and health care provider

must begin to use the standard specified

in § 142.1602 by (24 months after the

effective date of the final rule in the

Federal Register).

Subpart Q—Health Plan Premium

Payments

§ 142.1702 Standard for health plan

premium payments.

The standard for health plan premium

payments that must be used under this

subpart is the ASC X12 820—Payment

Order/Remittance Advice, (date),

Version 4010, Washington Publishing

Company, (004010X061). The Director

of the Federal Register approves this

incorporation by reference in

accordance with 5 U.S.C. 552(a) and 1

CFR part 51. The guide is available at

the addresses specified in § 142.108(a)

and (c) of this part.

§ 142.1704 Requirements: Health plans.

Each health plan must accept the

standard specified in § 142.1702 when

accepting electronically transmitted

health plan premium payments.

§ 142.1706 Requirements: Health care

clearinghouses.

Each health care clearinghouse must

use the standard specified in § 142.1702

when accepting or transmitting health

plan premium payments.

§ 142.1708 Effective dates of the initial

implementation of the standard for health

plan premium payments.

(a) Health plans. (1) Each health plan

that is not a small health plan must

comply with the requirements of

§§ 142.104 and 142.1704 by (24 months

after the effective date of the final rule

in the Federal Register).

(2) Each small health plan must

comply with the requirements of

§§ 142.104 and 142.1704 by (36 months

after the effective date of the final rule

in the Federal Register).

(b) Health care clearinghouses. Each

health care clearinghouse must begin to

the use the standard specified in

§ 142.1702 by (24 months after the

effective date of the final rule in the

Federal Register).

Subpart R—Referral Certification and

Authorization

§ 142.1802 Referral certification and

authorization.

The standard for referral certification

and authorization transactions that must

be used under this subpart is the ASC

X12N 278—Request for Review and

Response, (date), Version 4010,

Washington Publishing Company,

(004010X094). The Director of the

Federal Register approves this

incorporation by reference in

accordance with 5 U.S.C. 552(a) and 1

CFR part 51. The guide is available at

the addresses specified in § 142.108(a)

and (c) of this part.

§ 142.1804 Requirements: Health plans.

Each health plan must accept and

transmit the standard specified in

§ 142.1802 when accepting or

transmitting referral certifications and

authorizations.

§ 142.1806 Requirements: Health care

clearinghouses.

Each health care clearinghouse must

use the standard specified in § 142.1902
25310 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

when accepting or transmitting referral

certifications and authorizations.

§ 142.1808 Requirements: Health care

providers.

Any health care provider that

transmits or accepts referral

certifications and authorizations

electronically must use the standard

specified in § 142.1902.

§ 142.1810 Effective dates of the initial

implementation of the standard for referral

certifications and authorizations.

(a) Health plans. (1) Each health plan

that is not a small health plan must

comply with the requirements of

§§ 142.104 and 142.1804 by (24 months

after the effective date of the final rule

in the Federal Register).

(2) Each small health plan must

comply with the requirements of

§§ 142.104 and 142.1804 by (36 months

after the effective date of the final rule

in the Federal Register).

(b) Health care clearinghouses and

health care providers. Each health care

clearinghouse and health care provider

must begin to use the standard specified

in § 142.1802 by (24 months after the

effective date of the final rule in the

Federal Register).

Dated: March 27, 1998.

Donna E. Shalala,

Secretary.

Note: These Addenda will not appear in

the Code of Federal Regulations.

Addendum 1—Health Claims or Equivalent

Encounter Information

A. Retail Drug Claim or Equivalent Encounter

The transactions selected for retail drug

claims are accredited by the American

National Standards Institute (ANSI). The

transactions are: NCPDP

Telecommunications Standard Format

version 3.2 and the equivalent NCPDP Batch

Standard Version 1.0.

1. Implementation Guide and Source

The source of the implementation guide for

the NCPDP Telecommunication Standard

Format Version 3.2 and the equivalent

NCPDP Batch Standard Version 1.0 is the

National Council for Prescription Drug

Programs, 4201 North 24th Street, Suite 365,

Phoenix, AZ, 85016, Telephone 602–957–

9105, FAX 602–955–0749. The web site

address is http://www.ncpdp.org

2. Data Elements

Accumulated Deductible Amount

Additional Message Information

Adjustment/reject Code—1

Adjustment/reject Code—2

Adjustment/reject Code—3

Alternate Product Code

Alternate Product Type

Amount Attributed to Sales Tax

Amount Billed

Amount of Co-pay/co-insurance

Amount Rejected

Amt. Applied to Periodic Deduct

Amt. Attrib. To Prod. Selection

Amt. Exceed. Periodic Benefit Max

Authorization Number

Basis of Cost Determination

Basis of Days Supply Determination

Basis of Reimb. Determination

Batch Number

Bin Number

Cardholder First Name

Cardholder Id Number

Cardholder Last Name

Carrier Address

Carrier Correction Notice Fields

Carrier Identification Number

Carrier Location City

Carrier Location State

Carrier Name

Carrier Telephone Number

Carrier Zip Code

Claim Count

Claim/reference Id Number

Clinic Id Number

Co-pay Amount

Comments-1

Comments-2

Compound Code

Contract Fee Paid

Customer Location

Date Filled

Date of Birth

Date of Injury

Date Prescription Written

Days Supply

Destination Name

Destination Processor Number

Diagnosis Code

Diskette Record Id

Dispense as Written (Daw)

Dispensing Fee Submitted

Dollar Count

Dollars Adjusted

Dollars Billed

Dollars Rejected

Drug Name

Drug Type

Dur Conflict Code

Dur Intervention Code

Dur Outcome Code

Dur Response Data

Eligibility Clarification Code

Employer City Address

Employer Contact Name

Employer Name

Employer Phone Number

Employer State Address

Employer Street Address

Employer Zip Code

Fee or Markup

Gross Amount Due

Group Number

Home Plan

Host Plan

Incentive Amount Submitted

Incentive Fee Paid

Ingredient Cost Billed

Ingredient Cost Paid

Ingredient Cost

Level of Service

Master Sequence Number

Message

Metric Decimal Quantity

Metric Quantity

Ndc Number

New/refill Code

Number of Refills Authorized

Other Coverage Code

Other Payor Amount

Patient City Address

Patient First Name

Patient Last Name

Patient Paid Amount

Patient Pay Amount

Patient Phone Number

Patient Social Security

Patient State Address

Patient Street Address

Patient Zip Code

Payment Processor Id

Person Code

Pharmacy Address

Pharmacy Count

Pharmacy Location City

Pharmacy Location State

Pharmacy Name

Pharmacy Number

Pharmacy Telephone Number

Pharmacy Zip Code

Plan Identification

Postage Amount Claimed

Postage Amount Paid

Prescriber Id

Prescriber Last Name

Prescription Denial Clarification

Prescription Number

Prescription Origin Code

Primary Prescriber

Prior Authorization/medical Certification

Code And Number

Processor Address

Processor Control Number

Processor Location City

Processor Location State

Processor Name

Processor Number

Processor Telephone Number

Processor Zip Code

Record Identifier

Reject Code

Reject Count

Relationship Code

Remaining Benefit Amount

Remaining Deductible Amount

Response Data

Response Status

Resubmission Cycle Count

Run Date

Sales Tax Paid

Sales Tax

Sex Code

System Id

Terminal Id

Third Party Type

Total Amount Paid

Transaction Code

Unit Dose Indicator

Usual And Customary Charge

Version Release Number

B. Professional Health Claim or Equivalent

Encounter

The transaction selected for the

professional (non-institutional) health claim

or equivalent encounter information is ASC

X12N 837—Health Care Claim: Professional

(004010X098)

1. Implementation Guide and Source

The source of the implementation guide for

the professional health care claim or

equivalent encounter is: Washington

Publishing Company, 806 W. Diamond Ave.,

Suite 400, Gaithersburg, MD, 20878,

Telephone 301–590–9337, FAX: 301–869–
Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules 25311

9460. The web site address is http://

www.wpc-edi.com/hipaa/

2. Data Elements

Accident Date

Acute Manifestation Date

Additional Submitter or Receiver Name

Adjudication or Payment Date

Adjusted Repriced Claim Reference Number

Adjusted Repriced Line Item Reference

Number

Adjustment Amount

Adjustment Quantity

Adjustment Reason Code

Agency Qualifier Code

Allowed Amount

Ambulatory Patient Group Number

Amino Acid Name

Amount Qualifier Code

Anesthesia or Oxygen Minute Count

Approved Ambulatory Patient Group

Amount

Approved Ambulatory Patient Group Code

Approved Service Unit Count

Arterial Blood Gas Quantity

Arterial Blood Gas Test Date

Assigned Number

Assumed or Relinquished Care Date

Attachment Control Number

Attachment Description Text

Attachment Report Type Code

Attachment Transmission Code

Auto Accident State or Province Code

Benefits Assignment Certification Indicator

Billing Provider Additional Name

Billing Provider City Name

Billing Provider Contact Name

Billing Provider Credit Card Identifier

Billing Provider First Address Line

Billing Provider First Name

Billing Provider Identifier

Billing Provider Last or Organizational Name

Billing Provider Middle Name

Billing Provider Name Suffix

Billing Provider Postal Zone or ZIP Code

Billing Provider Second Address Line

Billing Provider State or Province Code

Bundled or Unbundled Line Number

Certification Form Number

Certification Period Projected Visit Count

Certified Registered Nurse Anesthetist

Supervision Indicator

Claim Adjustment Group Code

Claim Encounter Identifier

Claim Filing Indicator Code

Claim Frequency Code

Claim Note Text

Claim Payment Remark Code

Claim Submission Reason Code

Clinical Laboratory Improvement

Amendment Number

Code Category

Code List Qualifier Code

Coinsurance Amount

Communication Number Qualifier

Communication Number

Complication Indicator

Condition Codes

Condition Indicator

Contact Function Code

Contact Inquiry Reference

Continuous Passive Motion Date

Contract Amount

Contract Code

Contract Percentage

Contract Type Code

Contract Version Identifier

Country Code

Coverage Certification Period Count

Creation Date

Credit or Debit Card Holder Additional Name

Credit or Debit Card Holder First Name

Credit or Debit Card Holder Last or

Organizational Name

Credit or Debit Card Holder Middle Name

Credit or Debit Card Holder Name Suffix

Credit or Debit Card Maximum Amount

Credit or Debit Card Number

Credit/Debit Flag Code

Currency Code

Current Illness or Injury Date

CHAMPUS Non-availability Indicator

Daily Amino Acid Gram Use Count

Daily Amino Acid Prescription Milliliter Use

Count

Daily Dextrose Prescription Milliliter Use

Count

Daily Prescribed Nutrient Calorie Count

Daily Prescribed Product Calorie Count

Date of Surgical Procedure

Date Time Period Format Qualifier

Date/Time Qualifier

Deductible Amount

Diagnosis Associated Amount

Diagnosis Code Pointer

Diagnosis Code

Disability Type Code

Disability-From Date

Disability-To Date

Discipline Type Code

Drug Formulary Number

Drug Unit Price

Emergency Indicator

Emergency Medical Technician (EMT) or

Paramedic First Name

Emergency Medical Technician or Paramedic

Middle Name

Emergency Medical Technician or Paramedic

City Name

Emergency Medical Technician or Paramedic

First Address Line

Emergency Medical Technician or Paramedic

Last Name

Emergency Medical Technician or Paramedic

Name Additional Text

Emergency Medical Technician or Paramedic

Primary Identifier

Emergency Medical Technician or Paramedic

Second Address Line

Emergency Medical Technician or Paramedic

Secondary Identifier

Emergency Medical Technician or Paramedic

State Code

Emergency Medical Technician or Paramedic

ZIP Code

Employment Status Code

End Stage Renal Disease Payment Amount

Enteral or Parenteral Indicator

Entity Identifier Code

Entity Type Qualifier

Exception Code

Exchange Rate

Explanation of Benefits Indicator

EPSDT Indicator

Facility Type Code

Family Planning Indicator

Feeding Count

File Creation Time

First Visit Date

Fixed Format Information

Functional Status Code

Group or Policy Number

Hierarchical Child Code

Hierarchical ID Number

Hierarchical Level Code

Hierarchical Parent ID Number

Hierarchical Structure Code

Homebound Indicator

Hospice Employed Provider Indicator

HCPCS Payable Amount

Identification Code Qualifier

Immunization Status Code

Immunization Type Code

Independent Lab Charge Amount

Individual Relationship Code

Information Release Code

Information Release Date

Ingredient Cost Claimed Amount

Initial Treatment Date

Insurance Type Code

Insured Employer Additional Name

Insured Employer City Name

Insured Employer Contact Name

Insured Employer First Address Line

Insured Employer First Name

Insured Employer Identifier

Insured Employer Middle Name

Insured Employer Name Suffix

Insured Employer Name

Insured Employer Second Address Line

Insured Employer State Code

Insured Employer ZIP Code

Insured Group Name

Insured Group Number

Investigational Device Exemption Identifier

Laboratory or Facility City Name

Laboratory or Facility Contact Name

Laboratory or Facility First Address Line

Laboratory or Facility Name Additional Text

Laboratory or Facility Name

Laboratory or Facility Postal ZIP or Zonal

Code

Laboratory or Facility Primary Identifier

Laboratory or Facility Second Address Line

Laboratory or Facility Secondary Identifier

Laboratory or Facility State or Province Code

Last Certification Date

Last Menstrual Period Date

Last Seen Date

Last Worked Date

Last X-Ray Date

Legal Representative Additional Name

Legal Representative City Name

Legal Representative First Address Line

Legal Representative First Name

Legal Representative Last or Organization

Name

Legal Representative Middle Name

Legal Representative Second Address Line

Legal Representative State Code

Legal Representative Suffix Name

Legal Representative ZIP Code

Line Item Control Number

Line Note Text

Mammography Certification Number

Measurement Qualifier

Measurement Reference Identification Code

Medical Justification Text

Medical Record Number

Medicare Assignment Code

Medicare Coverage Indicator

Multiple Procedure Indicator

National Drug Code

National Drug Unit Count

Nature of Condition Code

Non-Payable Professional Component Billed

Amount

Non-Visit Code

Note Reference Code
25312 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

Nutrient Administration Method Code

Nutrient Administration Technique Code

Onset Date

Ordering Provider City Name

Ordering Provider Contact Name

Ordering Provider First Address Line

Ordering Provider First Name

Ordering Provider Identifier

Ordering Provider Last Name

Ordering Provider Middle Name

Ordering Provider Name Additional Text

Ordering Provider Name Suffix

Ordering Provider Second Address Line

Ordering Provider Secondary Identifier

Ordering Provider State Code

Ordering Provider ZIP Code

Original Line Item Reference Number

Originator Application Transaction Identifier

Other Employer Additional Name

Other Employer City Name

Other Employer First Address Line

Other Employer First Name

Other Employer Last or Organization Name

Other Employer Middle Name

Other Employer Second Address Line

Other Employer State Code

Other Employer ZIP Code

Other Insured Additional Identifier

Other Insured Additional Name

Other Insured Birth Date

Other Insured City Name

Other Insured First Address Line

Other Insured First Name

Other Insured Gender Code

Other Insured Identifier

Other Insured Last Name

Other Insured Middle Name

Other Insured Name Suffix

Other Insured Plan Name or Program Name

Other Insured Second Address Line

Other Insured State Code

Other Insured ZIP Code

Other Payer Additional Name Text

Other Payer City Name

Other Payer Covered Amount

Other Payer Discount Amount

Other Payer Federal Mandate Amount

Other Payer First Address Line

Other Payer Interest Amount

Other Payer Last or Organization Name

Other Payer Patient Paid Amount

Other Payer Patient Responsibility Amount

Other Payer Per Day Limit Amount

Other Payer Pre-Tax Claim Total Amount

Other Payer Primary Identifier

Other Payer Second Address Line

Other Payer Secondary Identifier

Other Payer State Code

Other Payer Tax Amount

Other Payer ZIP Code

Oxygen Saturation Quantity

Oxygen Saturation Test Date

Paid Service Unit Count

Paramedic Contact Name

Patient Account Number

Patient Additional Name

Patient Age

Patient Amount Paid

Patient Birth Date

Patient City Name

Patient Death Date

Patient Facility Additional Name Text

Patient Facility City Name

Patient Facility First Address Line

Patient Facility Name

Patient Facility Second Address Line

Patient Facility State Code

Patient Facility Zip Code

Patient First Address Line

Patient First Name

Patient Gender Code

Patient Height

Patient Last Name

Patient Marital Status Code

Patient Middle Name

Patient Name Suffix

Patient Primary Identifier

Patient Second Address Line

Patient Secondary Identifier

Patient Signature Source Code

Patient State Code

Patient ZIP Code

Pay-to Provider Additional Name

Pay-to Provider City Name

Pay-to Provider Contact Name

Pay-to Provider First Address Line

Pay-to Provider First Name

Pay-to Provider Identifier

Pay-to Provider Last or Organizational Name

Pay-to Provider Middle Name

Pay-to Provider Name Suffix

Pay-to Provider Second Address Line

Pay-to Provider State Code

Pay-to Provider ZIP Code

Payer Additional Identifier

Payer Additional Name

Payer City Name

Payer First Address Line

Payer Identifier

Payer Name

Payer Paid Amount

Payer Responsibility Sequence Number Code

Payer Second Address Line

Payer State Code

Payer ZIP Code

Period Count

Place of Service Code

Policy Compliance Code

Postage Claimed Amount

Prescription Amino Acid Concentration

Percent

Prescription Date

Prescription Dextrose Concentration Percent

Prescription Lipid Concentration Percent

Prescription Lipid Milliliter Use Count

Prescription Number

Prescription Period Count

Pricing Methodology

Prior Authorization Number

Procedure Modifier

Product Name

Product/Service ID Qualifier

Product/Service Procedure Code

Prognosis Code

Property Casualty Claim Number

Provider or Supplier Signature Indicator

Provider Code

Provider Identifier

Provider Organization Code

Provider Signature Date

Provider Specialty Certification Code

Provider Specialty Code

Purchase Price Amount

Purchase Service Charge Amount

Purchase Service Provider Identifier

Purchase Service State Code

Purchased Service Provider City Name

Purchased Service Provider Contact Name

Purchased Service Provider First Address

Line

Purchased Service Provider First Name

Purchased Service Provider Last or

Organization Name

Purchased Service Provider Middle Name

Purchased Service Provider Name Additional

Text

Purchased Service Provider Second Address

Line

Purchased Service Provider Secondary

Identifier

Purchased Service Provider State Code

Purchased Service Provider ZIP Code

Quantity Qualifier

Record Format Code

Reference Identification Qualifier

Referral Number

Referring Provider City Name

Referring Provider Contact Name

Referring Provider First Address Line

Referring Provider First Name

Referring Provider Identification Number

Referring Provider Last Name

Referring Provider Middle Name

Referring Provider Name Additional Text

Referring Provider Name Suffix

Referring Provider Second Address Line

Referring Provider Secondary Identifier

Referring Provider State Code

Referring Provider ZIP Code

Reimbursement Rate

Reject Reason Code

Related Hospitalization Admission Date

Related Hospitalization Discharge Date

Related Nursing Home Admission Date

Related-Causes Code

Rendering Provider City Name

Rendering Provider Contact Name

Rendering Provider First Address Line

Rendering Provider First Name

Rendering Provider Identifier

Rendering Provider Last Name

Rendering Provider Middle Name

Rendering Provider Name Additional Text

Rendering Provider Name Suffix

Rendering Provider Second Address Line

Rendering Provider Secondary Identifier

Rendering Provider State Code

Rendering Provider ZIP Code

Rental Equipment Billing Frequency Code

Rental Price Amount

Repriced Claim Reference Number

Repriced Line Item Reference Number

Repricing Organization Identifier

Repricing Per Diem or Flat Rate Amount

Resource Utilization Group Number

Resubmission Number

Retirement or Insurance Card Date

Review By Code Indicator

Sales Tax Amount

Sample Selection Modules

Saving Amount

School City Name

School Contact Name

School First Address Line

School Name Additional Text

School Name

School Primary Identifier

School Second Address Line

School State Code

School ZIP Code

Second Admission Date

Second Discharge Date

Service Date

Service From Date

Service Line Paid Amount

Service Type Code

Service Unit Count

Ship/Delivery or Calendar Pattern Code

Ship/Delivery Pattern Time Code
Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules 25313

Shipped Date

Similar Illness or Symptom Date

Special Program Indicator

Statement Covers Period End Date

Statement Covers Period Start Date

Student Status Code

Submittal Date

Submitted Charge Amount

Submitter or Receiver Address Line

Submitter or Receiver City Name

Submitter or Receiver Contact Name

Submitter or Receiver First Name

Submitter or Receiver Identifier

Submitter or Receiver Last or Organization

Name

Submitter or Receiver Middle Name

Submitter or Receiver State Code

Submitter or Receiver ZIP Code

Submitter Additional Name

Subscriber or Dependent Death Date

Subscriber Additional Identifier

Subscriber Birth Date

Subscriber Contact Name

Subscriber First Name

Subscriber Gender Code

Subscriber Identifier

Subscriber Last Name

Subscriber Marital Status Code

Subscriber Middle Name

Subscriber Name Suffix

Subscriber Postal ZIP Code

Subscriber Second Address Line

Subscriber State

Supervising Provider City Name

Supervising Provider Contact Name

Supervising Provider First Address Line

Supervising Provider First Name

Supervising Provider Identification Number

Supervising Provider Last Name

Supervising Provider Middle Name

Supervising Provider Name Additional Text

Supervising Provider Name Suffix

Supervising Provider Second Address Line

Supervising Provider Secondary Identifier

Supervising Provider State Code

Supervising Provider ZIP Code

Supporting Document Question Identifier

Supporting Document Response Code

Surgical Procedure Code

Terms Discount Percentage

Test Performed Date

Test Results

Time Period Qualifier

Total Claim Charge Amount

Total Purchased Service Amount

Total Visits Rendered Count

Transaction Segment Count

Transaction Set Control Number

Transaction Set Identifier Code

Transaction Set Purpose Code

Treatment or Therapy Date

Treatment Length

Unit or Basis for Measurement Code

Value Added Network Trace Number

Version Identification Code

Version Identifier

Weekly Prescription Lipid Use Count

Work Return Date

X-Ray Availability Indicator Code

C. Institutional Claim or Equivalent

Encounter

The transaction selected for the

institutional health care claim or equivalent

encounter information is ASC X12N 837—

Health Care Claim: Institutional

(004010X096).

1. Implementation Guide and Source

The source of the implementation guide for

the institutional health care claim or

equivalent encounter is: Washington

Publishing Company, 806 W. Diamond Ave.,

Suite 400, Gaithersburg, MD, 20878,

Telephone 301–590–9337, FAX: 301–869–

9460. The web site address is http://

www.wpc-edi.com/hipaa/

2. Data Elements

Activities Permitted

Adjusted Repriced Claim Reference Number

Adjustment Amount

Adjustment Quantity

Adjustment Reason Code

Admission Date and Hour

Admission Source Code

Admission Type Code

Allowed Amount

Amount Qualifier Code

Approved Amount

Approved Diagnosis Related Group Code

Approved HCPCS Code

Approved Revenue Code

Approved Service Unit Count

Assigned Number

Attachment Control Number

Attachment Description Text

Attachment Report Type Code

Attachment Transmission Code

Attending Physician First Name

Attending Physician Last Name

Attending Physician Middle Name

Attending Physician Primary Identifier

Auto Accident State or Province Code

Benefits Assignment Certification Indicator

Billing Note Text

Billing Provider City Name

Billing Provider Contact Name

Billing Provider First Address Line

Billing Provider Identifier

Billing Provider Last or Organizational Name

Billing Provider Postal Zone or ZIP Code

Billing Provider Second Address Line

Billing Provider State or Province Code

Certification Condition Indicator

Certification Type Code

Claim Adjustment Group Code

Claim Days Count

Claim Disproportionate Share Amount

Claim DRG Amount

Claim DRG Outlier Amount

Claim Encounter Identifier

Claim ESRD Payment Amount

Claim Filing Indicator Code

Claim Frequency Code

Claim HCPCS payable amount

Claim Indirect Teaching Amount

Claim MSP Pass-through amount

Claim Note Text

Claim Original Reference Number

Claim Payment Remark Code

Claim PPS capital amount

Claim PPS capital outlier amount

Claim Total Denied Charge Amount

Code Associated Amount

Code Associated Date

Code Associated Quantity

Code Category

Code List Qualifier Code

Contact Function Code

Contract Amount

Contract Code

Contract Percentage

Contract Type Code

Contract Version Identifier

Cost Report Day Count

Country Code

Covered Days or Visits Count

Creation Date

Credit or Debit Card Authorization Number

Credit or Debit Card Holder First Name

Credit or Debit Card Holder Last or

Organizational Name

Credit or Debit Card Holder Middle Name

Credit or Debit Card Maximum Amount

Credit or Debit Card Number

Currency Code

Date Time Period Format Qualifier

Date/Time Qualifier

Diagnosis Date

Discharge Hour

Discipline Type Code

Document Control Identifier

Employer Identification Number

Employment Status Code

Entity Identifier Code

Entity Type Qualifier

Estimated Amount Due

Estimated Claim Due Amount

Exception Code

Explanation of Benefits Indicator

Facility Code Qualifier

Facility Type Code

File Creation Time

Frequency Number

Functional Limitation Code

Group or Policy Number

Hierarchical Child Code

Hierarchical ID Number

Hierarchical Level Code

Hierarchical Parent ID Number

Hierarchical Structure Code

Home Health Certification Period

HCPCS Modifier Code

HCPCS/CPT–4 Code

Identification Code Qualifier

Implant Date

Implant Status Code

Implant Type Code

Individual Relationship Code

Industry Code

Information Release Code

Insurance Type Code

Insured Employer First Address Line

Insured Employer First Name

Insured Employer Identifier

Insured Group Name

Insured Group Number

Investigational Device Exemption Identifier

Last Admission Date

Last Visit Date

Leads Left In Patient Indicator

Legal Representative City Name

Legal Representative Contact Name

Legal Representative First Address Line

Legal Representative First Name

Legal Representative Last or Organization

Name

Legal Representative Middle Name

Legal Representative Second Address Line

Legal Representative State Code

Legal Representative ZIP Code

Lifetime Psychiatric Days Count

Lifetime Reserve Days Count

Line Charge Amount

Line Item Denied Charge or Non-Covered

Charge Amount

Manufacturer Identifier

Medicare Coverage Indicator

Medicare Paid at 100% Amount
25314 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

Medicare Paid at 80% Amount

Mental Status Code

Model Number

Non-Covered Charge Amount

Non-Insured Employer City Name

Non-Insured Employer First Address Line

Non-Insured Employer First Name

Non-Insured Employer Identifier

Non-Insured Employer Last or Organization

Name

Non-Insured Employer Middle Name

Non-Insured Employer Second Address Line

Non-Insured Employer State Code

Non-Insured Employer ZIP Code

Note Reference Code

Old Capital Amount

Operating Physician First Name

Operating Physician Last Name

Operating Physician Middle Name

Operating Physician Primary Identifier

Ordering Provider Identifier

Ordering Provider Last Name

Originator Application Transaction Identifier

Other Employer City Name

Other Employer First Address Line

Other Employer First Name

Other Employer Last or Organization Name

Other Employer Second Address Line

Other Employer Secondary Identifier

Other Employer State Code

Other Employer ZIP Code

Other Insured Additional Identifier

Other Insured Birth Date

Other Insured City Name

Other Insured First Address Line

Other Insured First Name

Other Insured Gender Code

Other Insured Identifier

Other Insured Last Name

Other Insured Middle Name

Other Insured Plan Name or Program Name

Other Insured Second Address Line

Other Insured State Code

Other Insured ZIP Code

Other Payer City Name

Other Payer First Address Line

Other Payer Last or Organization Name

Other Payer Patient Paid Amount

Other Payer Primary Identifier

Other Payer Second Address Line

Other Payer Secondary Identifier

Other Payer State Code

Other Payer ZIP Code

Other Physician First Name

Other Physician Identifier

Other Physician Last Name

Other Physician Middle Name

Paid From Part A Medicare Trust Fund

Amount

Paid From Part B Medicare Trust Fund

Amount

Patient Account Number

Patient Amount Paid

Patient Birth Date

Patient City Name

Patient Discharge Facility Type Code

Patient First Address Line

Patient First Name

Patient Gender Code

Patient Last Name

Patient Liability Amount

Patient Marital Status Code

Patient Middle Name

Patient Name Suffix

Patient Primary Identifier

Patient Second Address Line

Patient Secondary Identifier

Patient State Code

Patient Status Code

Patient ZIP Code

Payer Additional Identifier

Payer City Name

Payer First Address Line

Payer Identifier

Payer Name

Payer Paid Amount

Payer Responsibility Sequence Number Code

Payer Second Address Line

Payer State Code

Payer ZIP Code

Period Count

Physician Contact Date

Physician Order Date

Policy Compliance Code

Pricing Methodology

Prior Authorization Number

Procedure Modifier

Product/Service ID Qualifier

Product/Service Procedure Code

Professional Component Amount

Prognosis Code

PPS-Capital DSH DRG Amount

PPS-Capital Exception Amount

PPS-Capital FSP DRG Amount

PPS-Capital HSP DRG Amount

PPS-Capital IME amount

PPS-Operating Federal Specific DRG Amount

PPS-Operating Hospital Specific DRG

Amount

Quantity Qualifier

Reference Identification Qualifier

Reimbursement Rate

Reject Reason Code

Related-Causes Code

Repriced Claim Reference Number

Repricing Organization Identifier

Repricing Per Diem or Flat Rate Amount

Returned to Manufacturer Indicator

Saving Amount

School City Name

School First Address Line

School Name

School Primary Identifier

School Second Address Line

School State Code

School ZIP Code

Serial Number

Service Date

Service From Date

Service Line Paid Amount

Service Line Rate

Service Line Revenue Code

Service Unit Count

Statement From or To Date

Submission or Resubmission Number

Submitted Charge Amount

Submitter or Receiver Contact Name

Submitter or Receiver Identifier

Submitter or Receiver Last or Organization

Name

Subscriber Additional Identifier

Subscriber Birth Date

Subscriber First Address Line

Subscriber First Name

Subscriber Gender Code

Subscriber Last Name

Subscriber Marital Status Code

Subscriber Middle Name

Subscriber Second Address Line

Subscriber State

Surgery Date

Surgical Procedure Code

Terms Discount Percentage

Time Period Qualifier

Total Claim Charge Amount

Total Medicare Paid Amount

Total Visits Projected This Certification

Count

Transaction Segment Count

Transaction Set Control Number

Transaction Set Identifier Code

Transaction Set Purpose Code

Unit or Basis for Measurement Code

Value Added Network Trace Number

Version Identification Code

Visits Prior to Recertification Date Count

Warranty Expiration Date 1861J1 Facility

Indicator

D. Dental Claim or Equivalent Encounter

The transaction selected for the dental

health care claim or equivalent encounter is:

ASC X12N 837—Health Care Claim: Dental

(004010X097).

1. Implementation Guide and Source

The source of the implementation guide for

the dental health care claim or equivalent

encounter is: Washington Publishing

Company, 806 W. Diamond Ave., Suite 400,

Gaithersburg, MD, 20878, Telephone 301–

590–9337, FAX: 301–869–9460. The web site

address is http://www.wpc-edi.com/hipaa/

2. Data Elements

Accident Date

Adjudication or Payment Date

Adjustment Amount

Adjustment Quantity

Adjustment Reason Code

Admission Date or Start of Care Date

Amount Qualifier Code

Anesthesia Unit Count

Appliance Placement Date

Assigned Number

Assistant Surgeon City Name

Assistant Surgeon First Address Line

Assistant Surgeon First Name

Assistant Surgeon Last Name

Assistant Surgeon Middle Name

Assistant Surgeon Primary Identification

Number

Assistant Surgeon Second Address Line

Assistant Surgeon State Code

Assistant Surgeon Suffix Name

Assistant Surgeon ZIP Code

Attachment Control Number

Attachment Report Type Code

Attachment Transmission Code

Auto Accident State or Province Code

Benefits Assignment Certification Indicator

Billing Provider City Name

Billing Provider Credit Card Identifier

Billing Provider First Address Line

Billing Provider First Name

Billing Provider Identifier

Billing Provider Last or Organizational Name

Billing Provider Middle Name

Billing Provider Name Suffix

Billing Provider Postal Zone or ZIP Code

Billing Provider Second Address Line

Billing Provider State or Province Code

Claim Adjustment Group Code

Claim Encounter Identifier

Claim Filing Indicator Code

Claim

Submission Reason Code

Clinical Laboratory Improvement

Amendment Number
Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules 25315

Code List Qualifier Code

Contact Function Code

Coordination of Benefits Code

Country Code

Creation Date

Credit or Debit Card Authorization Number

Credit or Debit Card Holder First Name

Credit or Debit Card Holder Last or

Organizational Name

Credit or Debit Card Holder Middle Name

Credit or Debit Card Holder Name Suffix

Credit or Debit Card Maximum Amount

Credit or Debit Card Number

Credit/Debit Flag Code

Currency Code

Date Time Period Format Qualifier

Date/Time Qualifier

Destination Payer Code

Diagnosis Code

Diagnosis Date

Diagnosis Type Code

Discharge Date/End Of Care Date

Entity Identifier Code

Entity Type Qualifier

Facility Code Qualifier

Facility Type Code

File Creation Time

Group or Policy Number

Hierarchical Child Code

Hierarchical ID Number

Hierarchical Level Code

Hierarchical Parent ID Number

Hierarchical Structure Code

Identification Code Qualifier

Individual Relationship Code

Information Release Code

Information Release Date

Initial Placement Date

Insured Employer First Address Line

Insured Employer First Name

Insured Employer Identifier

Insured Employer Middle Name

Insured Employer Name Suffix

Insured Group Name

Insured Group Number

Laboratory or Facility City Name

Laboratory or Facility First Address Line

Laboratory or Facility Name

Laboratory or Facility Postal ZIP or Zonal

Code

Laboratory or Facility Primary Identifier

Laboratory or Facility Second Address Line

Laboratory or Facility State or Province Code

Legal Representative or Responsible Party

Identifier

Legal Representative City Name

Legal Representative First Address Line

Legal Representative First Name

Legal Representative Last or Organization

Name

Legal Representative Middle Name

Legal Representative Second Address Line

Legal Representative State Code

Legal Representative Suffix Name

Legal Representative ZIP Code

Line Charge Amount

Medicare Assignment Code

Oral Cavity Designation Code

Originator Application Transaction Identifier

Orthodontic Treatment Months Count

Orthodontic Treatment Months Remaining

Count

Other Insured Birth Date

Other Insured City Name

Other Insured First Address Line

Other Insured First Name

Other Insured Gender Code

Other Insured Identifier

Other Insured Last Name

Other Insured Middle Name

Other Insured Name Suffix

Other Insured Second Address Line

Other Insured State Code

Other Insured ZIP Code

Other Payer Covered Amount

Other Payer Discount Amount

Other Payer Last or Organization Name

Other Payer Patient Paid Amount

Other Payer Patient Responsibility Amount

Other Payer Primary Identifier

Patient Account Number

Patient Amount Paid

Patient Birth Date

Patient City Name

Patient First Address Line

Patient First Name

Patient Gender Code

Patient Last Name

Patient Marital Status Code

Patient Middle Name

Patient Name Suffix

Patient Primary Identifier

Patient Second Address Line

Patient Signature Source Code

Patient State Code

Patient ZIP Code

Pay-to-Provider City Name

Pay-to-Provider First Address Line

Pay-to-Provider First Name

Pay-to-Provider Identifier

Pay-to-Provider Last or Organizational Name

Pay-to-Provider Middle Name

Pay-to-Provider Name Suffix

Pay-to-Provider Second Address Line

Pay-to-Provider State Code

Pay-to-Provider ZIP Code

Payer Additional Identifier

Payer City Name

Payer First Address Line

Payer Identifier

Payer Name

Payer Paid Amount

Payer Responsibility Sequence Number Code

Payer Second Address Line

Payer State Code

Payer ZIP Code

Periodontal Charting Measurement

Policy Name

Predetermination of Benefits Identifier

Predetermination of Benefits Indicator

Prior Authorization Number

Prior Placement Date

Procedure Count

Procedure Modifier

Product/Service ID Qualifier

Product/Service Procedure Code

Prothesis, Crown or Inlay Code

Provider or Supplier Signature Indicator

Provider Signature Date

Quantity Qualifier

Reference Identification Qualifier

Referring Provider City Name

Referring Provider First Address Line

Referring Provider First Name

Referring Provider Identification Number

Referring Provider Last Name

Referring Provider Middle Name

Referring Provider Name Suffix

Referring Provider Second Address Line

Referring Provider State Code

Referring Provider ZIP Code

Related-Causes Code

Rendering Provider City Name

Rendering Provider First Address Line

Rendering Provider First Name

Rendering Provider Identifier

Rendering Provider Last Name

Rendering Provider Middle Name

Rendering Provider Name Suffix

Rendering Provider Second Address Line

Rendering Provider State Code

Rendering Provider ZIP Code

Replacement Date

Retirement or Insurance Card Date

School City Name

School First Address Line

School Name

School Primary Identifier

School Second Address Line

School State Code

School ZIP Code

Service Date

Service Line Paid Amount

Student Status Code

Submitter or Receiver Address Line

Submitter or Receiver City Name

Submitter or Receiver Contact Name

Submitter or Receiver First Name

Submitter or Receiver Identifier

Submitter or Receiver Last or Organization

Name

Submitter or Receiver Middle Name

Submitter or Receiver State Code

Submitter or Receiver ZIP Code

Subscriber Birth Date

Subscriber First Address Line

Subscriber First Name

Subscriber Gender Code

Subscriber Identifier

Subscriber Last Name

Subscriber Marital Status Code

Subscriber Middle Name

Subscriber Name Suffix

Subscriber Postal ZIP Code

Subscriber Second Address Line

Subscriber State

Title XIX Identification Number

Tooth Code

Tooth Number

Tooth Status Code

Tooth Surface

Total Claim Charge Amount

Transaction Segment Count

Transaction Set Control Number

Transaction Set Identifier Code

Transaction Set Purpose Code

Unit or Basis for Measurement Code

Addendum 2—Health Care Payment and

Remittance Advice

The transaction selected for the health care

payment and remittance advice is ASC X12N

835—Health Care Claim Payment/Advice

(004010X091).

A. Implementation Guide and Source

The source of the implementation guide for

the ASC X12N 835—Health Care Claim

Payment/Advice (004010X091) is:

Washington Publishing Company, 806 W.

Diamond Ave., Suite 400, Gaithersburg, MD,

20878, Telephone 301–590–9337, FAX: 301–

869–9460. The website address is http://

www.wpc-edi.com/hipaa/

B. Data Elements

Account Number Qualifier

Additional Payee Identifier
25316 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

Adjustment Amount

Adjustment Quantity

Adjustment Reason Code

Amount Paid to Patient

Amount Qualifier Code

Assigned Number

Average DRG length of stay

Average DRG weight

Century

Check or EFT Trace Number

Check/EFT Issue Date

Claim Adjustment Group Code

Claim Contact Communications Number

Claim Contact Name

Claim Date

Claim Disproportionate Share Amount

Claim ESRD Payment Amount

Claim Filing Indicator Code

Claim Frequency Code

Claim HCPCS payable amount

Claim Indirect Teaching Amount

Claim MSP Pass-through amount

Claim Payment Remark Code

Claim PPS capital amount

Claim PPS capital outlier amount

Claim Status Code

Claim Supplemental Information Amount

Claim Supplemental Information Quantity

Code List Qualifier Code

Communication Number Extension

Communication Number Qualifier

Contact Function Code

Corrected Insured Identification Indicator

Corrected Patient or Insured First Name

Corrected Patient or Insured Last Name

Corrected Patient or Insured Middle Name

Corrected Patient or Insured Name Prefix

Corrected Patient or Insured Name Suffix

Corrected Priority Payer Identification

Number

Corrected Priority Payer Name

Cost Report Day Count

Covered Days or Visits Count

Credit/Debit Flag Code

Crossover Carrier Identifier

Crossover Carrier Name

Currency Code

Date/Time Qualifier

Depository Financial Institution (DFI)

Identifier

Depository Financial Institution (DFI) ID

Number Qualifier

Description Text

Diagnosis Related Group (DRG) Weight

Diagnosis Related Group (DRG)

Discharge Fraction

Entity Identifier Code

Entity Type Qualifier

Exchange Rate

Facility Type Code

Fiscal Period Date

Identification Code Qualifier

Lifetime Psychiatric Days Count

Line Item Provider Payment Amount

Location Identification Code

Location Qualifier

National Uniform Billing Committee Revenue

Code

Old Capital Amount

Original Service Unit Count

Originating Company Supplemental Code

Other Claim Related Identifier

Patient Control Number

Patient First Name

Patient Last Name

Patient Liability Amount

Patient Middle Name

Patient Name Prefix

Patient Name Suffix

Patient Status Code

Payee City Name

Payee First Line Address

Payee Identification Code

Payee Name

Payee Postal Zip Code

Payee Second Line Address

Payee State Code

Payer City Name

Payer Claim Control Number

Payer Contact Communication Number

Payer Contact Name

Payer First Address Line

Payer Identifier

Payer Name

Payer Process Date

Payer Second Address Line

Payer State Code

Payer ZIP Code

Payment Format Code

Payment Method Code

Procedure Modifier

Product/Service ID Qualifier

Product/Service Procedure Code Text

Product/Service Procedure Code

Production Date

Professional Component Amount

Provider Adjustment Amount

Provider Adjustment Identifier

Provider First Name

Provider Identifier

Provider Last or Organization Name

Provider Middle Name

Provider Name Prefix

Provider Name Suffix

PPS-Capital DSH DRG Amount

PPS-Capital Exception Amount

PPS-Capital FSP DRG Amount

PPS-Capital HSP DRG Amount

PPS-Capital IME amount

PPS-Operating Federal Specific DRG Amount

PPS-Operating Hospital Specific DRG

Amount

Quantity Qualifier

Receiver or Provider Account Number

Receiver Identifier

Receiver/Provider Bank ID Number

Reference Identification Qualifier

Reimbursement Rate

Remark Code

Sender Account Number

Sender DFI Identifier

Service Date

Service Supplemental Amount

Service Supplemental Quantity Count

Submitted Charge Amount

Submitted Line Charges Paid

Subscriber First Name

Subscriber Identifier

Subscriber Last Name

Subscriber Middle Name

Subscriber Name Prefix

Subscriber Name Suffix

Total Actual Provider Payment Amount

Total Blood Deductible

Total Capital Amount

Total Claim Charge Amount

Total Claim Count

Total Coinsurance Amount

Total Contractual Adjustment Amount

Total Cost Outlier Amount

Total Cost Report Day Count

Total Covered Charge Amount

Total Covered Day Count

Total Day Outlier Amount

Total Deductible Amount

Total Denied Charge Amount

Total Discharge Count

Total Disp. Share Amount

Total DRG Amount

Total Federal-Specific Amount

Total Gramm-Rudman Reduction Amount

Total Hospital-Specific Amount

Total HCPCS Payable Amount

Total HCPCS Reported Charge Amount

Total Indirect Medical Education Amount

Total Interest Amount

Total MSP Pass-Through Amount

Total MSP Patient Liability Met Amount

Total MSP Payer Amount

Total Non-Covered Charge Amount

Total Non-Lab Charge Amount

Total Noncovered Charge Amount

Total Noncovered Day Count

Total Outlier Day Count

Total Patient Reimbursement Amount

Total Professional Component Amount

Total Provider Payment Amount

Total PIP Adjustment Amount

Total PIP Claim Count

Total PPS Capital FSP DRG Amount

Total PPS Capital HSP DRG Amount

Total PPS DSH DRG Amount

Trace Type Code

Transaction Handling Code

Transaction Segment Count

Transaction Set Control Number

Transaction Set Identifier Code

Units of Service Paid Count

Version Identifier

Addendum 3—Coordination of Benefits

A. Professional Claim Coordination of

Benefits

The transaction selected for the

professional claim coordination of benefits is

ASC X12N 837—Health Care Claim:

Professional (004010X098).

1. Implementation Guide and Source

The source of the implementation guide for

the professional claim coordination of

benefits transaction set is: Washington

Publishing Company, 806 W. Diamond Ave.,

Suite 400, Gaithersburg, MD, 20878,

Telephone 301–590–9337, FAX: 301–869–

9460. The web site address is http://

www.wpc-edi.com/hipaa/

2. Data Elements

Data elements are found in addendum 1,

B.2.

B. Institutional Claim Coordination of

Benefits

The transaction selected for the

institutional claim coordination of benefits is

ASC X12N 837—Health Care Claim:

Institutional (004010X096).

1. Implementation Guide and Source

The source of the implementation guide for

the institutional claim coordination of

benefits transaction set is: Washington

Publishing Company, 806 W. Diamond Ave.,

Suite 400, Gaithersburg, MD, 20878,

Telephone 301–590–9337, FAX: 301–869–

9460. The web site address is http://

www.wpc-edi.com/hipaa/
Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules 25317

2. Data Elements

Data elements are found in Addendum 1,

C.2.

C. Dental Claim Coordination of Benefits

The transaction selected for the dental

claim coordination of benefits is ASC X12N

837—Health Care Claim: Dental

(004010X097).

1. Implementation Guide and Source

The source of implementation guide for the

dental claim coordination of benefits

transaction set is: Washington Publishing

Company, 806 W. Diamond Ave., Suite 400,

Gaithersburg, MD, 20878, Telephone 301–

590–9337, FAX: 301–869–9460. The web site

address is http://www.wpc-edi.com/hipaa/

2. Data Elements

See Addendum 1, D.2.

D. Retail Drug Claim Coordination of Benefits

The transactions selected for retail drug

coordination of benefits is NCPDP

Telecommunications Standard Format

version 3.2 and the equivalent NCPDP Batch

Standard Version 1.0.

1. Implementation Guide and Source

The source of implementation guide for the

retail drug claim coordination of benefits

transaction set is: National Council for

Prescription Drug Programs, 4201 North 24th

Street, Suite 365, Phoenix, AZ, 85016,

Telephone 602–957–9105, FAX 602–955–

0749. The web site address is http://

www.ncpdp.org

2. Data Elements

See Addendum 1, A.2.

Addendum 4—Health Claim Status

The transaction selected for the health

claim status is ASC X12N 276/277—Health

Care Claim Status Request and Response

(004010X093).

A. Implementation Guide and Source

The source of the implementation guide for

the health claim status transaction set is:

Washington Publishing Company, 806 W.

Diamond Ave., Suite 400, Gaithersburg, MD,

20878, Telephone 301–590–9337, FAX: 301–

869–9460. The website address is http://

www.wpc-edi.com/hipaa/

B. Data Elements

Adjudication or Payment Date

Amount Qualifier Code

Bill Type Identifier

Check or EFT Trace Number

Check/EFT Issue Date

Claim Payment Amount

Claim Service Period

Creation Date

Date Time Period Format Qualifier

Date/Time Qualifier

Entity Identifier Code

Entity Type Qualifier

Extra Narrative Data

Health Care Claim Status Category Code

Health Care Claim Status Code

Hierarchical Child Code

Hierarchical ID Number

Hierarchical Level Code

Hierarchical Parent ID Number

Hierarchical Structure Code

Identification Code Qualifier

Information Receiver Additional Address

Information Receiver Address

Information Receiver City

Information Receiver First Name

Information Receiver Identification Number

Information Receiver Last or Organization

Name

Information Receiver Middle Name

Information Receiver Name Prefix

Information Receiver Name Suffix

Information Receiver Specific Location

Information Receiver State

Information Receiver ZIP Code

Line Charge Amount

Line Item Control Number

Line Item Service Date

Location Qualifier

Original Service Unit Count

Originator Application Transaction Identifier

Patient Control Number

Patient First Name

Patient Last Name

Patient Middle Name

Patient Name Prefix

Patient Name Suffix

Payer City Name

Payer Claim Control Number

Payer First Address Line

Payer Identifier

Payer Name

Payer Second Address Line

Payer State Code

Payer ZIP Code

Payment Method Code

Procedure Modifier

Product/Service ID Qualifier

Provider First Name

Provider Identifier

Provider Last or Organization Name

Provider Middle Name

Provider Name Prefix

Provider Name Suffix

Reference Identification Qualifier

Revenue Code

Service Identification Code

Service Line Date

Service Unit Count

Status Information Effective Date

Subscriber Birth Date

Subscriber City

Subscriber First Address Line

Subscriber First Name

Subscriber Gender Code

Subscriber Identifier

Subscriber Last Name

Subscriber Middle Name

Subscriber Name Prefix

Subscriber Name Suffix

Subscriber Postal ZIP Code

Subscriber Second Address Line

Subscriber State

Total Claim Charge Amount

Trace Type Code

Transaction Segment Count

Transaction Set Control Number

Transaction Set Identifier Code

Transaction Set Purpose Code

Transaction Type Code

[Direct Comments to Judy Ball, Enrollment

and Eligibility IT]

Addendum 5—Benefit Enrollment and

Maintenance

The transaction selected for benefit

enrollment and maintenance is ASC X12N

834—Benefit Enrollment and Maintenance

Transaction Set (004010X095).

A. Implementation Guide and Source

The source of the implementation guide for

the benefit enrollment and maintenance

transaction set is: Washington Publishing

Company, 806 W. Diamond Ave., Suite 400,

Gaithersburg, MD, 20878, Telephone 301–

590–9337, FAX: 301–869–9460. The web site

address is http://www.wpc-edi.com/hipaa/

B. Data Elements

Label—name of elements

Account Address Information

Account City Name

Account Communication Number

Account Contact Inquiry Reference Number

Account Contact Name

Account Country Code

Account Effective Date

Account Identification Code

Account Monetary Amount

Account Number Qualifier

Account Postal ZIP Code

Account State Code

Action Code

Additional Account Identifier

Additional Other Coverage Identifier

Adjustment Amount

Adjustment Reason Code Characteristic

Adjustment Reason Code

Amount Qualifier Code

Assigned Number

Benefit Account Number

Benefit Status Code

Birth Sequence Number

Card Count

Citizenship Status Code

Code List Qualifier Code

Communication Number Qualifier

Communication Number

Consolidated Omnibus Budget Reconciliation

Act (COBRA) Qualifying Event Code

Contact Function Code

Contact Inquiry Reference

Coordination of Benefits Code

Coordination of Benefits Date

Country Code

Coverage Level Code

Creation Date

Credit/Debit Flag Code

Current Health Condition Code

Date Time Period Format Qualifier

Date/Time Qualifier

Dependent Employer Identification Code

Dependent Employer Name

Dependent Employment Date

Dependent School Date

Dependent School Identification Code

Dependent School Name

Description Text

Diagnosis Code

Disability Eligibility Date

Disability Maximum Entitlement Amount

Disability Type Code

Employment Status Code

Enrollment Control Total

Entity Identifier Code

Entity Relationship Code

Entity Type Qualifier

File Creation Time

First Diagnosed Date

Frequency Code

Gender Code

Group or Policy Number
25318 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

Health Coverage Eligibility Date

Health-Related Code

Identification Card Type Code

Identification Code Qualifier

Individual Relationship Code

Industry Code

Insurance Eligibility Date

Insurance Group Number

Insurance Line Code

Insurer Contact Inquiry Reference

Insurer Contact Name

Insurer Contact Number

Insurer Entity Relationship Code

Insurer Identification Code

Insurer Name

Issuing State

Last Visit Reason Text

Late Reason Code

Location Qualifier

Maintenance Reason Code

Maintenance Type Code

Marital Status Code

Master Policy Number

Medicare Plan Code

Member Additional Address

Member City Name

Member Contact Name

Member Postal Code

Member State or Province Code

Monetary Amount

Occupation Code

Other Insurance Company Identification

Code

Other Insurance Company Name

Payer Responsibility Sequence Number Code

Plan Coverage Description Text

Policy Name

Pre-disability Work Days Count

Premium Contribution Amount

Previous Transaction Identifier

Primary Insured Collateral Dependent Count

Primary Insured Sponsored Dependent Count

Product Option Code

Product/Service ID Qualifier

Provider Code

Provider Communications Number

Provider Contact Inquiry Reference

Provider Contact Name

Provider Eligibility Date

Provider First Name

Provider Identifier

Provider Last or Organization Name

Provider Middle Name

Provider Name Prefix

Provider Name Suffix

Quantity Count

Quantity Qualifier

Race or Ethnicity Code

Reference Identification Qualifier

Sponsor Additional Name

Sponsor City Name

Sponsor Contact Name

Sponsor Country Code

Sponsor Identifier

Sponsor Name

Sponsor State Code

Sponsor Street Address

Sponsor Zip Code

Student Status Code

Subscriber or Dependent Death Date

Subscriber Additional Identifier

Subscriber Birth Date

Subscriber City

Subscriber County Code

Subscriber Current Weight

Subscriber First Address Line

Subscriber First Name

Subscriber Height

Subscriber Identifier

Subscriber Last Name

Subscriber Middle Name

Subscriber Name Prefix

Subscriber Name Suffix

Subscriber Postal ZIP Code

Subscriber Previous Weight

Subscriber Second Address Line

Subscriber State

Time Zone Code

Transaction Segment Count

Transaction Set Control Number

Transaction Set Identifier Code

Transaction Set Purpose Code

TPA or Broker Account Address

TPA or Broker Account Amount

TPA or Broker Account City Name

TPA or Broker Account Contact

Communication Number

TPA or Broker Account Contact Inquiry

Reference

TPA or Broker Account Contact Name

TPA or Broker Account Number

TPA or Broker Account Postal Code

TPA or Broker Account State or Province

Code

TPA or Broker Additional Account Reference

Identification Number

TPA or Broker Additional Name

TPA or Broker Communication Number

TPA or Broker Contact Inquiry Reference

Number

TPA or Broker Country Code

TPA or Broker Identification Code

TPA or Broker Name

TPA or Broker State Code

Underwriting Decision Code

Version Identification Code

Weight Change Text

Work Intensity Code

Yes/No Condition or Response Code

Addendum 6—Eligibility for a Health Plan

The transaction selected for the eligibility

for a health plan is ASC X12N 270/271—

Health Care Eligibility Inquiry and Response

(004010X092).

A. Implementation Guide and Source

The source of the implementation guide for

eligibility for a health plan transaction set is:

Washington Publishing Company, 806 W.

Diamond Ave., Suite 400, Gaithersburg, MD,

20878, Telephone 301-590–9337, FAX: 301–

869–9460. The website address is http://

www.wpc-edi.com/hipaa/

B. Data Elements

Labels

Agency Qualifier Code

Amount Qualifier Code

Authorization Indicator Code

Benefit Coverage Level Code

Benefit Used or Available Amount

Birth Sequence Number

Communication Number Qualifier

Communication Number

Contact Function Code

Country Code

Coverage Level Code

Creation Date

Date Time Period Format Qualifier

Date/Time Qualifier

Dependent Additional Identification Text

Dependent Additional Identifier

Dependent Benefit Date

Dependent Birth Date

Dependent City Name

Dependent Communications Number

Dependent Contact Name

Dependent First Line Address

Dependent First Name

Dependent Gender Code

Dependent Identification Code

Dependent Last Name

Dependent Middle Name

Dependent Name Suffix

Dependent Postal Zip Code

Dependent Second Line Address

Dependent State Code

Dependent Trace Number

Description Text

Eligibility or Benefit Amount

Eligibility or Benefit Information

Eligibility or Benefit Percent

Entity Identifier Code

Entity Type Qualifier

File Creation Time

Follow-up Action Code

Free-Form Message Text

Handicap Indicator Code

Hierarchical Child Code

Hierarchical ID Number

Hierarchical Level Code

Hierarchical Parent ID Number

Hierarchical Structure Code

Identification Code Qualifier

Individual Relationship Code

Information Receiver Additional Address

Information Receiver Additional Identifier

Information Receiver Address

Information Receiver City

Information Receiver Contact Name

Information Receiver First Name

Information Receiver Identification Number

Information Receiver Last or Organization

Name

Information Receiver Middle Name

Information Receiver Name Suffix

Information Receiver State

Information Receiver Trace Number

Information Receiver ZIP Code

Information Source Contact Name

Information Source Process Date

Insurance Eligibility Date

Insurance Type Code

Insured Indicator

Location Identification Code

Location Qualifier

Loop Identifier Code

Maintenance Reason Code

Maintenance Type Code

Network Services Code

Originating Company Identifier

Originating Company Secondary Identifier

Period Count

Plan Coverage Description Text

Plan Sponsor Name

Printer Carriage Control Code

Prior Authorization Number

Prior Authorization Text

Procedure Coding Method

Procedure Modifier

Product/Service ID Qualifier

Provider Address 1

Provider Address 2

Provider City

Provider Code

Provider Contact Name

Provider Contact Number

Provider First Name
Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules 25319

Provider Identifier

Provider Last or Organization Name

Provider Middle Name

Provider Name Suffix

Provider Specialty Certification Code

Provider Specialty Code

Provider State

Provider Zip

Quantity Qualifier

Receiver Additional Identifier Description

Text

Receiver Additional Identifier

Receiver Provider Additional Identifier Type

Code

Receiver Provider Additional Identifier

Receiver Trace Number

Reference Identification Qualifier

Reject Reason Code

Relationship To Insured Code

Sample Selection Modulus

Service Type Code

Service Unit Count

Ship/Delivery or Calendar Pattern Code

Ship/Delivery Pattern Time Code

Source Additional Reference Identifier

Source City Name

Source Organization Name

Source Postal Zip Code

Source Primary Identification Number

Source State Code

Source Street Address

Spend Down Amount

Student Status Code

Subscriber Additional Identifier

Subscriber Additional Information Text

Subscriber Benefit Date

Subscriber Birth Date

Subscriber Card Issue Date

Subscriber City

Subscriber Contact Name

Subscriber Contact Phone Number

Subscriber First Address Line

Subscriber First Name

Subscriber Gender Code

Subscriber Identifier

Subscriber Last Name

Subscriber Middle Name

Subscriber Name Suffix

Subscriber Postal ZIP Code

Subscriber Second Address Line

Subscriber State

Time Period Qualifier

Trace Assigning Entity Additional Number

Trace Assigning Entity Number

Trace Number

Trace Type Code

Transaction Segment Count

Transaction Set Control Number

Transaction Set Identifier Code

Transaction Set Purpose Code

Transaction Type Code

Unit or Basis for Measurement Code

Valid Request Indicator Code

Value Added Network Trace Number

Addendum 7—Health Plan Premium

Payment

The transaction selected for the health plan

premium payment is ASC X12N 820—

Payment Order/Remittance Advice

Transaction Set (004010X061).

A. Implementation Guide and Source

The source of the implementation guide for

the health plan premium payment

transaction set is: Washington Publishing

Company, 806 W. Diamond Ave., Suite 400,

Gaithersburg, MD, 20878, Telephone 301–

590–9337, FAX: 301–869–9460. The website

address is http://www.wpc-edi.com/hipaa/

B. Data Elements

Account Number Qualifier

Adjustment Reason Code

Assigned Number

Billed Premium Amount

Contact Function Code

Contract or Invoice or Account Number

Country Code

Coverage Period Date

Credit/Debit Flag Code

Currency Code

Date Time Period Format Qualifier

Date/Time Qualifier

Depository Financial Institution (DFI)

Identifier

Depository Financial Institution (DFI) ID

Number Qualifier

Employee Identification Number

Entity Identifier Code

Exchange Rate

Funds Issued Date

Head Count

Identification Code Qualifier

Individual Identifier

Information Only Indicator Code

Information Receiver City

Information Receiver Last or Organization

Name

Information Receiver State

Information Receiver ZIP Code

Insurance Policy or Plan Identifier

Line Item Control Number

Organization Premium Identification Code

Originating Company Identifier

Originating Company Supplemental Code

Payer Additional Name

Payer City Name

Payer Contact Name

Payer Identifier

Payer Name

Payer Process Date

Payer Second Address Line

Payer State Code

Payer ZIP Code

Payment Action Code

Payment Format Code

Payment Method Code

Payroll Processor Additional Name

Payroll Processor City Name

Payroll Processor Contact Name

Payroll Processor First Address Line

Payroll Processor Identifier

Payroll Processor Name

Payroll Processor Second Address Line

Payroll Processor State Code

Payroll Processor ZIP Code

Policy Level Individual Name

Premium Delivery Date

Premium Payment Amount

Premium Receiver First Address Line

Premium Receiver Reference Identifier

Premium Receiver Second Address Line

Receiver Account Number

Receiver Additional Name

Receiver Identifier

Reference Identification Qualifier

Sender Account Number

Trace Number

Trace Type Code

Transaction Handling Code

Transaction Segment Count

Transaction Set Control Number

Transaction Set Identifier Code

Unit or Basis for Measurement Code

Addendum 8—Referral Certification and

Authority

The transaction selected for the referral

certification and authority is ASC X12N

278—Health Care Services Review

Information (004010X094).

A. Implementation Guide and Source

The source of the implementation guide for

the referral certification and authority is:

Washington Publishing Company, 806 W.

Diamond Ave., Suite 400, Gaithersburg, MD,

20878, Telephone 301–590–9337, FAX: 301–

869–9460. The website address is http://

www.wpc-edi.com/hipaa/

B. Data Elements

Action Code

Admission Source Code

Admission Type Code

Agency Qualifier Code

Ambulance Transport Code

Ambulance Transport Reason Code

Ambulance Trip Destination Address

Ambulance Trip Origin Address

Arterial Blood Gas Quantity

Certification Condition Indicator

Certification Expiration Date

Certification Number

Certification Type Code

Chiropractic Series Treatment Number

Citizenship Status Code

Code Category

Code List Qualifier Code

Communication Number Qualifier

Complication Indicator

Condition Codes

Contact Function Code

Country Code

Creation Date

Current Health Condition Code

Daily Oxygen Use Count

Date Time Period Format Qualifier

Date/Time Qualifier

Delay Reason Code

Dependent Additional Identification Text

Dependent Additional Identifier

Dependent Birth Date

Dependent Citizenship Country Code

Dependent First Name

Dependent Gender Code

Dependent Identification Code

Dependent Last Name

Dependent Marital Status Code

Dependent Middle Name

Dependent Name Prefix

Dependent Name Suffix

Dependent Trace Number

Diagnosis Code

Diagnosis Date

Diagnosis Type Code

Entity Identifier Code

Entity Type Qualifier

Equipment Reason Description

Facility Code Qualifier

Facility Type Code

File Creation Time

Follow-up Action Code

Free-Form Message Text

Full Destination Address

Full Origin Address

Hierarchical Child Code

Hierarchical ID Number
25320 Federal Register / Vol. 63, No. 88 /Thursday, May 7, 1998 / Proposed Rules

Hierarchical Level Code

Hierarchical Parent ID Number

Hierarchical Structure Code

Home Health Certification Period

Identification Code Qualifier

Information Release Code

Insured Indicator

Last Admission Date

Last Visit Date

Level of Service Code

Medicare Coverage Indicator

Monthly Treatment Count

Nature of Condition Code

Nursing Home Residential Status Code

Originator Application Transaction Identifier

Oxygen Delivery System Code

Oxygen Equipment Type Code

Oxygen Flow Rate

Oxygen Saturation Quantity

Oxygen Test Condition Code

Oxygen Test Findings Code

Oxygen Use Period Hour Count

Patient Condition Description Text

Patient Discharge Facility Type Code

Patient Status Code

Patient Weight

Period Count

Physician Contact Date

Physician Order Date

Portable Oxygen System Flow Rate

Previous Certification Identifier

Procedure Date

Procedure Monetary Amount

Procedure Quantity

Product/Service ID Qualifier

Product/Service Procedure Code Text

Product/Service Procedure Code

Prognosis Code

Proposed Admission Date

Proposed Discharge Date

Proposed Surgery Date

Provider Code

Provider Contact Name

Provider Identifier

Provider Service State Code

Provider Specialty Certification Code

Provider Specialty Code

Quantity Qualifier

Race or Ethnicity Code

Reference Identification Qualifier

Reject Reason Code

Related-Causes Code

Relationship To Insured Code

Request Category Code

Requester Address First Address Line

Requester Address Second Address Line

Requester City Name

Requester Contact Communication Number

Requester Contact Name

Requester Country Code

Requester First Name

Requester Identifier

Requester Last or Organization Name

Requester Middle Name

Requester Name Prefix

Requester Name Suffix

Requester Postal Code

Requester State or Province Code

Requester Supplemental Identifier

Respiratory Therapist Order Text

Round Trip Purpose Description Text

Sample Selection Modulus

Second Surgical Opinion Indicator

Service Authorization Date

Service From Date

Service Provider City Name

Service Provider Contact Communication

Number

Service Provider Country Code

Service Provider First Address Line

Service Provider First Name

Service Provider Identifier

Service Provider Last or Organization Name

Service Provider Middle Name

Service Provider Name Prefix

Service Provider Name Suffix

Service Provider Postal Code

Service Provider Second Address Line

Service Provider State or Province Code

Service Provider Supplemental Identifier

Service Trace Number

Service Type Code

Service Unit Count

Ship/Delivery or Calendar Pattern Code

State Code

Stretcher Purpose Description Text

Subluxation Level Code

Subscriber Additional Identifier

Subscriber Additional Information Text

Subscriber Birth Date

Subscriber Citizenship Country Code

Subscriber First Name

Subscriber Gender Code

Subscriber Identifier

Subscriber Last Name

Subscriber Marital Status Code

Subscriber Middle Name

Subscriber Name Prefix

Subscriber Name Suffix

Subscriber Trace Number

Surgery Date

Surgical Procedure Code

Time Period Qualifier

Trace Type Code

Transaction Segment Count

Transaction Set Control Number

Transaction Set Identifier Code

Transaction Set Purpose Code

Transaction Type Code

Transport Distance

Treatment Count

Treatment Period Count

Treatment Series Number

Unit or Basis for Measurement Code

Utilization Management Organization (UMO)

or Last Name

Utilization Management Organization (UMO)

First Address Line

Utilization Management Organization (UMO)

First Name

Utilization Management Organization (UMO)

Middle Name

Utilization Management Organization (UMO)

Name Prefix

Utilization Management Organization (UMO)

Name Suffix

Utilization Management Organization (UMO)

Second Address Line

Utilization Managment Organization (UMO)

City Name

Utilization Managment Organization (UMO)

Contact Communication Number

Utilization Managment Organization (UMO)

Contact Name

Utilization Managment Organization (UMO)

Country Code

Utilization Managment Organization (UMO)

Identifier

Utilization Managment Organization (UMO)

Postal Code

Utilization Managment Organization (UMO)

State or Province Code

Valid Request Indicator Code

Version/Release/Industry Identifier

X-Ray Availability Indicator Code 1861J1

Facility Indicator

[FR Doc. 98–11691 Filed 5–1–98; 9:04 am]

BILLING CODE 4120–01–P

DEPARTMENT OF HEALTH AND

HUMAN SERVICES

Office of the Secretary

45 CFR Part 142

[HCFA–0045-P]

RIN 0938–AH99

National Standard Health Care

Provider Identifier

AGENCY: Health Care Financing

Administration (HCFA), HHS.

ACTION: Proposed rule.

SUMMARY: This rule proposes a standard

for a national health care provider

identifier and requirements concerning

its use by health plans, health care

clearinghouses, and health care

providers. The health plans, health care

clearinghouses, and health care

providers would use the identifier,

among other uses, in connection with

certain electronic transactions.

The use of this identifier would

improve the Medicare and Medicaid

programs, and other Federal health

programs and private health programs,

and the effectiveness and efficiency of

the health care industry in general, by

simplifying the administration of the

system and enabling the efficient

electronic transmission of certain health

information. It would implement some

of the requirements of the

Administrative Simplification subtitle

of the Health Insurance Portability and

Accountability Act of 1996.

DATES: Comments will be considered if

we receive them at the appropriate

address, as provided below, no later

than 5 p.m. on July 6, 1998.

ADDRESSES: Mail written comments (1

original and 3 copies) to the following

address: Health Care Financing

Administration, Department of Health

and Human Services, Attention: HCFA–

0045-P, P.O. Box 26585, Baltimore, MD

21207–0519.

If you prefer, you may deliver your

written comments (1 original and 3

copies) to one of the following

addresses:

Room 309–G, Hubert H. Humphrey

Building, 200 Independence Avenue,

SW., Washington, DC 20201, or

Room C5–09–26, 7500 Security

Boulevard, Baltimore, MD 21244–

1850.