Reform Alert - News from the Blues' Office of National Health Reform

Administrative simplification provision creates operating rules and uniform standards

Nov. 03, 2010

While much attention has focused on the policy, benefit and coverage changes under health care reform, the Patient Protection and Affordable Care Act (PPACA) also places significant emphasis on making the health system more efficient by simplifying health care administration and reducing the clerical burden on physicians, patients and health plans.

The reform law calls for the adoption of a single set of operating rules, certification requirements, and Health Insurance Portability and Accountability Act (HIPAA) transactional standards to simplify health insurance administration and create uniformity in the implementation of electronic standards. The changes are meant to reduce administrative costs associated with health care through standardization, enhance ease of doing business between insurers and providers, and to promote growth of electronic recordkeeping and use of electronic claims processing.

The rules include the following key provisions: 

  • Eligibility verification and claims status (effective Jan. 1, 2013) 
  • Electronic funds transfers and health care payment and remittance (effective no later than Jan. 1, 2014) 
  • Health claims or equivalent encounter information, enrollment and disenrollment in a health plan, health plan premium payments, and referral certification and authorization (effective no later than July 1, 2016) 
  • Unique heath plan identifier (effective no later than Oct. 1, 2012) 
  • Claims attachments (effective no later than January 1, 2016) 

For more information, see Sec. 1104 (Administrative Simplification) in the Patient Protection and Affordable Care Act (PDF).

Blue Cross Blue Shield of Michigan and Blue Care Network have had internal solutions in place to help simplify administrative functions since HIPAA was implemented in 2002. The Blues will continue to evaluate and implement measures needed to ensure compliance with all electronic transaction requirements.

The information on this website is based on BCBSM's review of the national health care reform legislation and is not intended to impart legal advice. Interpretations of the reform legislation vary, and efforts will be made to present and update accurate information. This overview is intended as an educational tool only and does not replace a more rigorous review of the law's applicability to individual circumstances and attendant legal counsel and should not be relied upon as legal or compliance advice. Analysis is ongoing and additional guidance is also anticipated from the Department of Health and Human Services. Additionally, some reform regulations may differ for particular members enrolled in certain programs such as the Federal Employee Program, and those members are encouraged to consult with their benefit administrators for specific details.

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