HHS: Streamlined electronic funds transfer will save providers time, money

Recent efforts to streamline and standardize electronic funds transfers (EFT) will save the healthcare system--including individual doctors, hospitals, and payers--billions of dollars over the next 10 years, according to the U.S. Department of Health & Human Services (HHS).

HHS today released a rule that adopts streamlined standards for the format and data content of the transmission a health plan sends to its bank when it wants to pay a claim to a provider through EFT and to issue a notice of payment, which may or may not accompany the payment itself.

The provision to the Affordable Care Act and the Health Insurance Portability and Accountability Act (HIPAA) builds upon regulations that set industry-wide standards for how health providers use electronic systems to determine a patient's eligibility for health coverage and check on the status of a health claim.

The American Medical Association (AMA) and other groups have been calling for these improvements for years. In 2010, AMA wrote a white paper calling on the government to "eliminate significant administrative waste from the healthcare system by simplifying and standardizing the current healthcare billing and payment process."

Also in 2010, a study in the journal Health Affairs found that nearly 12 percent of every dollar physicians receive from patients goes to fund paperwork and administrative tasks. The study also found that simplifying these systems could save four hours per physician and five hours of support staff time every week.

For many providers, time is just as precious as money--perhaps even more so. Centers for Medicare & Medicaid Services acting Administrator Marilyn Tavenner, who is herself a nurse, repeated a common refrain when she noted that the less time a physician spends on paperwork, the more time he or she can devote to patient care. "Having standardized procedures across the healthcare industry can only lead to lower costs and greater efficiencies all around," she said in an HHS release.

Any organization covered by HIPAA must comply with the new rule by Jan. 1, 2014.

The government promises similar actions to come. Future simplification rules will call for adoption of standard unique identifiers for health plans, a standard for claims attachments and will require health plans certify compliance with all HIPAA standards and operating rules, according to the release.

To learn more:
- read Federal Register pre-publication version of the rule (.pdf)
- read the HHS news release
- see the AMA whitepaper (.pdf)

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