Affordable Care Act update - New Rules Regarding How Claim Payments Are Transmitted

Marc Altneu is a local health insurance broker/consultant specializing in the ACA and all lines of benefits. marc@mcmagency.com

Effective January 1, 2014, the Affordable Care Act (“ACA”)

requires that a health plan that makes payments to providers

via electronic funds transfers (“EFT”) use new standards. A

health plan must have the ability to remit provider payments

via EFT.

EFT is an electronic funds transfer. For this purpose, an EFT

is the electronic transmission of any of the following from a

health plan to a health care provider:

•

payment;

•

information about the transfer of funds;

•

payment-processing information;

•

explanation of benefits; or

•

remittance advice.

What is required?

As of January 1, 2014, a health plan must have the ability

to conduct EFT upon provider request. HIPAA covered

entities such as group health plans are not required to use

the Automated Clearing House Network (the “ACH Network”)

to transmit and receive health care claim payments by EFT.

As of January 1, 2014, health plans and providers are not

prohibited from using other networks such as Fedwire, card

payment networks, etc. For example, the new rules do not

apply to health plan debit card transactions. However, if

a provider requests that a health plan conduct EFT using

the ACH Network, the health plan is required to do so.

Regardless of the network used, every effort should be made

by the health plan to ensure that re-association between the

payment and the remittance advice can be automated by

providers.

Unlike HIPAA’s Privacy and Security rules, these standards

apply to a covered transaction even if the transaction does

not involve any protected health information. For example,

an EFT transmission can be just a payment, without any

individually identifiable information.

Providers are not required to accept health care payments via

E F T.

For insured plans, the insurance carriers are responsible

for compliance; for self-insured plans, the employers are

responsible.

Standards when a Health Plan Conducts

EFT Using the ACH Network

HHS adopted a single set of operating rules for each covered

transaction with the goal of creating as much uniformity in

the implementation of the electronic standards as possible—

building on the transaction standards already issued under

HIPAA. Operating rules are “the necessary business rules

and guidelines for the electronic exchange of information

that is not defined by a standard or its implementation

specifications,” as adopted by HHS. Information about the

operating rules and their implementation can be found on the

CAQH website at:

http://www.caqh.org/ORMandate_EFT.php

Employer Action

No action is required of employers of insured plans, as the

carrier should have this responsibility.

Employers of self-funded plans should coordinate with

their third-party administrators (“TPAs”) and respond to any

requests to provide certain information such as confirming

that the bank does not have a block on debit transactions,

and confirming the routing number to be used for EFT

transactions.