Streamline Your Revenue LifeCycle Through HIPAA’s Administrative Simplification Regulations

Posted on

When we meet with clients, we often discuss several different audit streams that help us evaluate their revenue cycle and ways to improve it. One area that we’ve found to be of particular frustration for many practices is HIPAA’s Administrative Simplification requirements. Compliance with these requirements is key to an organization’s revenue cycle, and important for its ability to better deliver patient services. Still, many practices feel the process for phasing in these requirements is too costly, and they have a hard time getting past that. This reluctance to see past the expense of compliance reminds us of an important reason why we work with our clients to see the big picture of the revenue cycle as well as the details.

Sometimes it’s very difficult to see the connection between all the rules and regulations that govern our healthcare ecosystem and the bottom line at your organization. Often, it feels like we’re dealing with compliance issues on a different plane than financial or revenue matters, when really they should be in the same conversation. HIPAA’s Administrative Simplification regulations have been phased in over the past five years and will continue under the Affordable Care Act. They live up to their billing — the changes you’ve already implemented at your organization to comply with these rules actually do simplify your life and help your revenue cycle.

Sharing is Caring: Operating Rules Help Everyone Exchange Data

One of the major tools in HIPAA’s Administrative Simplification regulations is the establishment of a set of operating rules to govern relationships between providers and vendors. Established by the multi-stakeholder Committee on Operating Rules for Information Exchange (CORE) as part of the Council for Affordable Quality Healthcare (CAQH), the CORE integrated model operating rules are designed to contribute to the vision of an industry-wide data exchange.1

Similar to the technical standards embraced by banking and telecommunications industries, among others, the CORE operating rules help providers, payers and vendors share large quantities of data efficiently. The rules include standards to govern:

  • Rights and responsibilities of all parties
  • Security
  • Exception processing
  • Transmission standards and formats
  • Response timing standards
  • Liabilities
  • Error resolution2

The integrated model has been phased in over three chronological phases, starting with detailed rules and guidelines over how to present and exchange information such as patient eligibility data. Subsequent phases covered changes to organizational infrastructure to support the operating standards; how to exchange data related to claims status and claim payment and remittance; and the use of patient health ID cards.3

How Does Sharing Information Electronically Help My Revenue Cycle?

It’s natural to ask, once all the scrutiny of the regulations is over and the multi-step process to get into compliance has been in progress for years, how exactly has all this benefited my organization? Generally speaking, keeping your organization in compliance with the CORE operating rules pays plenty of dividends because all interactions with your organization will be much more efficient.

This means that every time a patient, payer, vendor, or consulting partner encounters any part of your healthcare organization’s system, it is likely to be a pleasant experience thanks to the numerous efficiencies you’ve set up to comply with HIPAA Administrative Simplification. For example, requirements such as the use of “https” safe harbor connections and other security checks can help ensure data privacy. Better patient satisfaction scores come from compliance with certain requirements, including confirming eligibility and claim status information in under 20 seconds.

Standardized forms and compliance with operating rules for your electronic funds transfer (EFT) system will significantly speed up your payments. We’ve found this is a huge problem for many of our clients as many payers are not in compliance, and some try to give virtual credit cards instead of an electronic funds transfer. It is an ongoing battle, even though it is the law. Streamlined financial transactions also significantly reduce the chance of rejections based on errors, meaning less re-work for your staff and higher percentages of first-time claims paid, all of which goes straight to the health of your revenue cycle.

The Administrative Simplification regulations also include a provision for an Electronic Remittance Advice (ERA) document, or a description from health plans to providers of payment schedules and other details. The development and maintenance of this information can help your organization understand exactly what will be paid in every situation, helping you forecast better and improve your revenue cycle.4 As this is standardized, it helps decrease the confusion over multiple formats of explanation of benefits (EOB) and makes it easier to train staff (although we have not see any evidence that payers are standardizing EOBs).

Utilizing the EFT and ERA tools and operating rules can help reduce your organization’s overall cost of doing business with payers because administrative information is readily available and less time is spent verifying information over the phone, which backfire because some payers no longer accept phone calls from known billing company phone numbers. Having the information available frees up your staff to work on other initiatives and spend more time on patient care.

What’s Next?

Currently, the HIPAA Transactions & Code Set (TCS) and Affordable Care Act (ACA) operating rules are being enforced primarily on a complaint basis, meaning that investigations are opened up when there is reason to believe an organization is not in compliance. So you’re not likely to have an investigator contact you unless your payers or vendors are very unhappy with how little you’ve done to assist with secure, accessible exchange of crucial data. We can’t imagine you’d want to be in that situation regardless of the compliance ramifications, especially because, as we’ve just pointed out, being in compliance with these Administrative Simplification regulations is actually quite helpful to the overall efficiency of your revenue cycle.5 Of course, the complaint-based system goes both ways. We also have a process for turning in a payer as well, as outlined by the Medical Group Management Association, and we can assist clients through that process if necessary.

So what’s next? Hopefully you’ve already prepared for the Jan. 1, 2016 implementation of operating rules for electronic pre-authorizations, referrals, claims and claims attachments (if not, contact us to find out how you can quickly bring your organization into compliance). The next major date is Nov. 7, 2016, when you’ll need to be prepared to use Health Plan Identifiers (HPIDs) by covered entities in all aspects of your operations.6

As trusted revenue cycle management partners for many health organizations, we know that there are definitely elements of our industry that seem like rules for the sake of having rules, or minutiae that could be simplified. After seeing firsthand the benefits of building out an improved data exchange system in accordance with the HIPAA Administrative Simplification regulations, we can confidently say that these aren’t make-work. In fact, they can help make your revenue cycle work, while providing the ultimate benefit of allowing your staff to spend more time with patients and less time on paperwork, which is a win for everyone.

Physician Revenue Navigators is your premier partner for revenue lifecycle management. Contact us to learn more about applying HIPAA administrative simplification to your organization’s systems and how we can help you optimize your revenue cycle.

Show 6 footnotes

  1. “CAQH CORE Overview: Operating Rules Streamline the Business of Healthcare,” accessed Dec. 28, 2015,
  2. “HIPAA Administrative Simplification: Regulation Text,” March 26, 2013,
  3. “Streamlining Your Practice With Administrative Simplification,” Sept. 17, 2014,
  4. “Administrative Simplification — What does it really mean?” accessed Dec. 28, 2015,
  5. “Streamlining Your Practice,” Ibid.
  6. “Administrative Simplification,” accessed Dec. 28, 2015,

Leave a Reply

Your email address will not be published. Required fields are marked *