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Administrative Simplification CORBAmed January 12, 1999 Bill Braithwaite Senior Advisor on Health Information Policy U.S. Department of Health and Human Services Administrative Simplification Law Title II - Subtitle F of H.R. 3103 (the Kassebaum/Kennedy Bill)

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corbamed january 12 1999



CORBAmedJanuary 12, 1999

Bill Braithwaite

Senior Advisor on Health Information Policy

U.S. Department of Health and Human Services

administrative simplification law
Administrative Simplification Law

Title II - Subtitle F of H.R. 3103(the Kassebaum/Kennedy Bill)

“The Health Insurance Portability and Accountability Act of 1996” AKA “HIPAA”

Signed August 21, 1996 to become

P.L. 104-191

Part C of Title XI of the Social Security Act

purpose of provisions
Purpose of Provisions
  • Improve the efficiency and effectiveness of the health care system by standardizing the electronic data interchange of certain administrative and financial transactions.
  • Protect the security and privacy of transmitted information.


overview of provisions
Overview of Provisions
  • HHS must adopt national standards necessary for efficient, electronic, administrative and financial health care transactions.
  • All health plans, all clearinghouses, and those providers who choose to conduct these transactions electronically, are required to implement these standards.
  • Recommendations for privacy legislation.
  • Recommendations for electronic medical records.
mandated standards
Mandated Standards
  • 9 EDI transaction standards (claims, encounters, enrollment, etc.) including code sets.
  • Coordination of benefits information.
  • Unique identifiers (including allowed uses) for individuals, employers, health plans, and health care providers.
  • Security, confidentiality, and electronic signatures.
standards adoption process
Standards Adoption Process
  • HHS looks to industry for consensus standard:
    • developed by ANSI accredited standards setting organization (SDO).
    • HHS works with industry to develop and confirm consensus at implementation guide level.
  • Secretary relies on recommendations of the NCVHS, which holds public meetings and hearings as required to get public input.
  • HHS publishes proposed rules and then final rules which have the force of federal law.
satisfaction of requirements
Satisfaction of Requirements
  • Directly transmitting and receiving data using adopted standards
  • Submitting non-standard data to a health care clearinghouse for transmission using adopted standards.
  • Receiving non-standard data from a health care clearinghouse after conversion from data received using adopted standards.
  • Penalty for Non-compliance with Standards:
    • $100 each violation; maximum $25,000 per year per violation of identical requirement or prohibition.
  • Penalty for Wrongful Disclosure:
    • Maximum $250,000 and 10 years imprisonment.
publications in 1998
Publications in 1998
  • Federal Register - Notices of Proposed Rule Making (NPRMs) and their public comment periods:
    • Transactions and Medical Coding (5/7/98 - 7/6/98)
    • National Provider ID (5/7/98 - 7/6/98)
    • Employer ID (6/16/98 - 8/17/98)
    • Security (8/12/98 - 10/13/98)
expected 1999 publications
Expected 1999 Publications
  • Final rules for transactions, security, provider identifier, and employer identifier.
  • NPRM for Health Plan Identifier
  • NPRM for Claims Attachment
  • NPRM for First Report of Injury
  • Possible standard for Health Number for Individuals?
expected 2000 publications
Expected 2000 Publications
  • Standards for Privacy of Individually Identifiable Health Information (whether or not Congress passes privacy law by August 1999).
  • NCVHS Recommendations for standards for patient medical record information and the electronic exchange of such information.
  • Possible other financial and administrative transactions that improve the operation of the health care system and reduce administrative costs.
criteria for standards
Criteria for Standards
  • Improve efficiency and effectiveness
    • by leading to cost reductions for or improvements in benefits from electronic health care transactions.
  • Meet needs of user community
  • Data element definitions and codes consistent and uniform with other standards.
  • Low development and implementation costs relative to benefits of using the standard.
  • Supported by ANSI-accredited SDO or other organization to ensure continuity and updating.
criteria for standards14
Criteria for Standards
  • Timely development, testing, implementation, and updating procedures.
  • Technologically independent of computer platforms and transmission protocols, except when explicitly part of the standard.
  • Precise and unambiguous, but simple as possible.
  • Low data collection and paperwork burdens.
  • Flexibility to adapt to changes in infrastructure.
new technology
New Technology
  • Proposed process to introduce new technology:
    • Request waiver for testing showing
      • clear improvement over the current standard.
      • cost-benefit analysis.
    • Test new standard or revision of current standard.
    • Report on test results.
    • HHS will adopt new or revised standard if
      • benefits of the proposed revision or new standard significantly outweigh the disadvantages of implementing it.
  • One standard for the data (definitions + conditions)
  • Potential for multiple transport standards
  • Open standards (over proprietary)
  • Due process for consideration of all input (ANSI)
  • Standards at implementation guide level
  • Consider cost of supporting multiple standards
  • Limit transition requirements as standards evolve
  • Web Sites:
      • posting of law, process, regulations, and comments.
      • posting of X12N implementation guides
  • Listserv:
    • receive e-mail notification on publication of documents related to HIPAA regulations
    • send e-mail to:
    • include in body of message:

subscribe HIPAA-REGS first-name last-name