New Regulations for Electronic Funds Transfers Will Save $4.5 Billion

The Centers for Medicare and Medicaid (CMS) has issued an interim final rule with comment period under which the Department of Health and Human Services will adopt new standards for electronic funds transfers in health care. According to a press release, the new standards are estimated to save physicians’ practices and hospitals up to $4.5 billion over 10 years.

This is the second in a series of regulations that CMS is required to issue over the next 5 years designed to streamline health care administrative transactions, encourage greater use of standards by providers and make existing standards work more efficiently.

The new regulations aim to create 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 electronically, as well as the standards for Remittance Advice notices.

In addition to saving significant amounts of time and money, the regulations will save an estimated 800,000 pounds of paper and 2.2 million pounds of greenhouse gases over 10 years.

Future administrative simplification rules will include a standard unique identifier for health plans, a standard for claims attachments and requirements that health plans certify compliance with all Health Insurance Portability and Accountability Act (HIPAA) standards and operating rules.

The current regulation took effect on January 1, and all health plans covered under HIPAA must comply by January 1, 2014.

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