PROVIDER PAYMENT RIGHTS
AND THE HEALTHCARE EFT
STANDARD & OPERATING RULES
Priscilla Holland, AAP
Senior Director, Healthcare Payments
NACHA – The Electronic Payments
Association
WA AK HFMA Alaska Conference
November 19, 2013
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
Who is NACHA?
• Standards rulemaking body
that administers the ACH
Network
• NACHA Operating Rules:
• Establish the legal foundation
for the ACH Network
• Provide a common set of rules
and formats
• Create certainty and
interoperability
• Prescribe roles and
responsibilities
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
2
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
What is the ACH Network?
• The ACH Network:
• Facilitates global commerce
by serving as a safe, efficient,
ubiquitous and high-quality
electronic payment system; it
is best known for Direct
Deposit and Direct Payment
• Is accessible via more than
13,000 U.S. financial
institutions
• More than 21 billion ACH
payments in 2012, moving
$36.9 trillion in value
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
3
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
How does this impact healthcare payments?
• The Healthcare EFT Standard is
the CCD+Addenda, an ACH
Network format.
• NACHA is the standards body for
the healthcare EFT standard.
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
4
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
Changes to the NACHA Operating Rules to Align with
Healthcare
DETAILS WITHIN THE NACHA OPERATING RULES AND CCD+ STANDARD ARE BEING REFINED TO
ALIGN WITH HEALTHCARE OPERATING RULES1
Overview of NACHA Rule
Changes
Detail
Standard Identification of
Health Care EFTs
The rule requires health plans to clearly identify CCD Entries that are Health Care
EFT Transactions through the use of the specific identifier “HCCLAIMPMT”
Additional Formatting
Requirements for Health
Care EFTs
For a CCD Entry that contains the healthcare indicator, as described above, the
health plan must include an addenda record that contains the ASC X12 Version 5010
835 TRN (Reassociation Trace Number) data segment; and to identify itself in the
transaction by its name as it would be known by the provider
Delivery of Payment Related
Information (Reassociation
Number)
The rule requires an RDFI to provide or make available, either automatically or upon
request, all information contained within the Payment Related Information field of the
Addenda Record, no later than the opening of business on the second Banking Day
following the Settlement Date. Further, this Rule would require the RDFI to offer or
make available to the healthcare provider an option to receive or access the Payment
Related Information via a secure, electronic means
Addition of New EDI Data
Segment Terminator
The rule provides for the use of a second data segment terminator, the tilde (“~”), to
any data segments carried in the Addenda Record of the CCD Entry
Health Care Terminology
within the NACHA Operating
Rules
The rule includes healthcare-related definitions
1Changes
were effective September 20, 2013
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
Healthcare EFT Transaction Volumes
Sep-13*
Number of Forward CCD
Credits
Total $ Value of CCD
Credits
Number of Forward CCD
Debits
Total $ Value of CCD
Debits
Total # of addenda
records with forward
debits and credits
Number of Returns of
CCD Credits and Debits
Average $ value of
credits
Avg # of credit trans per
business day
% of transactions with
addenda records
* Only 7 processing days
in Sept 2013. Changes
implemented 9/20/13
Oct-13
Y-T-D Totals
1,319,207
5,628,162
6,947,369
$ 7,467,200,857.99
$25,090,277,618.94
$32,557,478,476.93
1,555
4,289
5,844
$1,714,608.54
$562,345,466.55
$564,060,075.09
1,293,744
5,630,232
6,923,976
534
1,251
1,785
$5,660.37
$4,457.99
188,458
255,826
97.95%
99.96%
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
6
SIMPLIFYING PAYMENTS WITH THE
HEALTHCARE EFT STANDARD
What is the
Healthcare EFT Standard?
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
7
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
CCD+ Addenda: The Healthcare EFT Standard
• Patient Protection and Affordable Care Act (ACA) mandated the
identification of a HIPAA standard for EFT transactions and the
development of healthcare operating rules to support the HIPAA
standard transaction
• Allows you to directly receive health plan claims
reimbursements in your bank account, like Direct Deposit
• Only payment option required to offer providers the ability to
automatically reassociate remittance information with the
payment
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
8
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
Healthcare EFT & ERA Standards + Operating Rules
EFT & ERA
Standards
EFT & ERA
Operating
Rules
ACH CCD+ & X12
v5010 835
CAQH CORE EFT & ERA
Operating Rules
• EFT: NACHA
CCD+Addenda (must
contain the TRN
Reassociation Trace
Number data segment
as defined by X12
835 TR3 version
5010)
• ERA: X12 v5010 835
• Health Care Claim
Payment/Advice (835)
Infrastructure Rule
• Uniform Use of CARCs and
RARCs (835) Rule
• EFT & ERA Reassociation
(CCD+/835) Rule
• EFT Enrollment Data Rule
• ERA Enrollment Data Rule
Admin
Simplification
Together, EFT & ERA
Standards and
Operating Rules will
deliver efficiency and
consistency across
the healthcare
industry
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
9
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
Healthcare Payment Chain
Provider
1. Patient Encounter with Provider
Health Plan
1
3
2. Provider submits Claim (837) to Health Plan
3. Health Plan Adjudicates Claim
2
4. *Health Plan sends Electronic Remittance
Advice (ERA) (835) to Provider. The ERA
contains TRN Reassociation Trace Number
8
4
5
7
5. *Health Plan sends CCD+ to ODFI for Claim
Reimbursement, including a matching TRN
Reassociation Trace Number
6. ODFI Sends ACH CCD+ Addenda through
ACH Network to RDFI
6
7. RDFI receives CCD+ for Provider, deposits
credit to Provider account, and delivers the
TRN Reassociation Trace Number to
Provider
RDFI
ODFI
ACH
(Receiving Bank or Operator (Originating Bank or
8. Provider Reconciles the payment and ERA
Credit Union)
Credit Union)
by matching the TRN segment from both
*The CCD+addenda and ERA are generally not sent on the same
transactions (#4 and #5)
day. CAQH CORE operating rules establish max timeframe for
distribution.
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
10
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
Healthcare EFT Standard- Final Rule Summary
• Identifies the Healthcare EFT Standard as a HIPAA Standard
•
45 CFR § 162.1602
• Health plans are required to deliver HIPAA Standards if
requested by Provider
• 45 CFR § 162. 925
• Does not require providers to receive health plan payments via the
Healthcare EFT Standard (can still request a check or other EFT
options)
• However, all Medicare payments will come via the EFT Standard
• Neither prohibits nor adopts any standards for health care EFTs
transmitted outside the ACH Network
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
11
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
Healthcare Standard Final Rule:
Standard for Data Content of Addenda Record
• CCD+ Addenda enables
automatic reassociation of
health plan payment with
remittance information
• Your financial institution can
provide you with the
information to match the
payment with the remittance
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
12
SIMPLIFYING PAYMENTS WITH THE
HEALTHCARE EFT STANDARD
What do I need to do to comply
with legislation and operating rules
for the Healthcare EFT Standard?
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
13
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
High-Level Provider Requirements
• Enroll with individual health
plans to receive EFT*
– Prioritize health plans, 80% of
claims reimbursements may
come from 20% of plans
• Request reassociation trace
number from your bank or
credit union
*Enrollment databases are being developed by organizations to simplify enrollment process
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
14
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
CAQH CORE 370 EFT & ERA Reassociation
Healthcare Operating Rule
CORE-required Minimum CCD+ Reassociation Data Elements
CCD+ Record
Field #
Field Name
Batch Header
Record
Detail Record
9
Effective Entry Date
6
Amount
Addenda Record
3
Payment Related Information
•
CAQH CORE 370 EFT & ERA Reassociation Healthcare Operating Rule requires that
the Provider proactively contact its bank or credit union to receive the Core-required
Minimum CCD+ Reassociation Data Elements
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
15
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
Terminology When Talking to Your Financial
Institution
•
CORE EFT & ERA Operating Rules: Request
the CORE-required Minimum CCD+
Reassociation Data Elements
•
If your financial institution does not recognize
that, try:
• ACH Payment-Related Information
• ACH Addenda Record Information
• Payment-Related Addenda Information
•
NACHA Operating Rules, Subsection 3.1.5.3
require a financial institution to provide the
Payment Related Information to the Receiver
if it is requested
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
16
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
When do I need to be ready to accept the Healthcare
EFT Standard?
Compliance in Effect
as of January 1, 2013
Implement by
January 1, 2014
Implement by
January 1, 2016
•
•
Eligibility for health plan
Claims status transactions
•
•
Electronic funds transfer (EFT) transactions
Health care payment and remittance advice (ERA)
transactions
•
•
•
•
•
Health claims or equivalent encounter information
Enrollment and disenrollment in a health plan
Health plan premium payments
Referral certification and authorization
Health claims attachments
Required for all HIPAA Covered Entities
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
17
SIMPLIFYING PAYMENTS WITH THE
HEALTHCARE EFT STANDARD
What are others required to do?
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
18
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
Healthcare EFT Standard & Operating Rules
• Health Plans are required to:
• Certify to HHS that they are
compliant with healthcare EFT
standard and healthcare EFT &
ERA Operating Rules by 1/1/14*
• Offer payment via Healthcare
EFT Standard (CCD+) (required
if requested by provider)
• Offer electronic EFT enrollment
• Originate healthcare EFT and
ERA within 3 business days of
each other
*Certification date is expected to change, but not the implementation date
of the healthcare EFT standard and EFT & ERA Operating Rules.
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
19
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
Significant Fines for Non-compliance
• ACA Section 1104 – Administrative Simplification
requires health plans to certify compliance with the
healthcare EFT standard and healthcare operating rules
by January 1, 2014
• Health plans can be fined
• $1 per covered life per day
• Not to exceed an amount equal to $20 per covered life per
day
• Or an amount equal to $40 per covered life under the plan
if such plan has knowingly provided inaccurate or
incomplete certification information
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
20
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
Barriers to EFT Adoption
•
White paper issues by NACHA and CAQH June 2011, Adoption of EFT and
ERA by Health Plans and Providers identified barriers to Provider
acceptance of ACH/EFT & ERA for healthcare claims reimbursement.
• Provider enrollment with health plans is currently inefficient and timeconsuming due to non-standard processes (EFT Enrollment Data Rule)
• Providers often have difficulty matching an EFT with its associated ERA
(missing or incorrect trace number) (EFT & ERA Reassociation Rule)
• Lack of understanding of electronic transactions, processes and
workflows
• Providers perceive that the costs and complexities associated with
implementing electronic workflows for EFT and ERA outweigh the
benefits
• Some providers also perceive a lack of control over retroactive
adjustments and denials by health plans (including debiting of their
accounts).
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material
is not intended to provide any warranties or legal advice and is intended for educational
purposes only.
21
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
NACHA Operating Rules
Requirements for Financial Institutions
• Financial institutions are required to:
• Deliver the Payment Related Information (TRN Reassocaiton
Trace Number) to the Receiver/Provider if it is requested.
– Subsection 3.1.5.3
• Have a secure electronic delivery option available for the
provider
– Many FIs have multiple delivery options and will work with the
provider to determine what delivery method is best for the provider
– Providers are not required to receive the TRN Reassociation Trace
Number via secure electronic option, but the financial institution must
make a secure electronic option available
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
22
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
CAQH CORE in collaboration with NACHA
• Were identified as authoring entities for the EFT & ERA
Operating Rules
• CAQH is a nonprofit alliance of health plans and trade
associations collaborating on initiatives that simplify
healthcare administration
• CAQH Committee on Operating Rules for Information
Exchange (CORE) developed voluntary operating rules
starting in 2005 that were the foundation for the Eligibility
and Claims Status Operating Rules
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
23
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
Mandated EFT & ERA Operating Rules:
January 1, 2014 Requirements Scope
Data
Content
Rule
Uniform Use of CARCs and
RARCs (835) Rule
•
Identifies a minimum set of four CAQH CORE-defined Business Scenarios with a
maximum set of CAQH CORE-required code combinations that can be applied to
convey details of the claim denial or payment to the provider
•
•
•
Identifies a maximum set of standard data elements for EFT enrollment
Outlines a flow and format for paper and electronic collection of the data elements
Requires health plan to offer electronic EFT enrollment
•
Similar to EFT Enrollment Data Rule
•
Addresses provider receipt of the CAQH CORE-required Minimum ACH CCD+ Data
Elements required for re-association
Addresses elapsed time between the sending of the v5010 835 and the CCD+
transactions
Requirements for resolving late/missing EFT and ERA transactions
Recognition of the role of NACHA Operating Rules for financial institutions
Claim Adjustment Reason Code (CARC)
Remittance Advice Remark Code (RARC)
Rule 360
EFT Enrollment Data Rule
Rule 380
ERA Enrollment Data Rule
Rule 382
Infrastructure
High-Level Requirements
EFT & ERA Reassociation
(CCD+/835) Rule
•
Rule 370
•
•
•
Health Care Claim
Payment/Advice (835)
Infrastructure Rule
Rule 350
•
•
•
Specifies use of the CAQH CORE Master Companion Guide Template for the flow
and format of such guides
Requires entities to support the Phase II CAQH CORE Connectivity Rule.
Includes batch Acknowledgement requirements*
Defines a dual-delivery (paper/electronic) to facilitate provider transition to electronic
remits
* CMS-0028-IFC excludes requirements pertaining to acknowledgements.
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
24
SIMPLIFYING PAYMENTS WITH THE
HEALTHCARE EFT STANDARD
What are the benefits of using
the Healthcare EFT Standard?
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
25
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
Benefits of Choosing the Healthcare EFT Standard
• Easy, Automatic Payments – Receiving
healthcare EFTs via ACH is as quick as
receiving Direct Deposit.
• Improved Cash Flow – Healthcare EFTs
via ACH ensure funds are available up to
7 days faster than with paper checks.
• Safe and Secure – Checks continue to
be the dominant payment form targeted
by fraudsters. Replacing all checks with
healthcare EFTs via ACH is the single
best way to combat fraud.
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
26
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
Benefits of Choosing the Healthcare EFT Standard
• Automatic Reassociation – Only healthcare EFTs via ACH
offer providers the ability to automatically reassociate
remittance information.
• HIPAA EFT Transaction– As a HIPAA transaction, under 45
CFR 162.925, providers can request delivery of the healthcare
EFT standard and health plans must comply.
• Smart, Cost-Effective Choice – The cost of claims via ACH
is, on average, only $0.34 versus $10.73 or more for other
EFT payment types.
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
27
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
Providers Rights under the ACA
• With the exception of Medicare, the provider has the
right to determine how they will be paid for healthcare
claims reimbursements
• Medicare claims reimbursements must be made via
healthcare EFT standard effective January 1, 2014
• Providers have the right to receive claims reimbursements
via paper check, healthcare EFT standard or other EFT
payment options
• Effective January 1, 2014 a health plan must deliver claims
reimbursement payments via the healthcare EFT standard,
if it is requested by the provider
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
28
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
Comparison of Electronic Payment Options
“make an educated choice”
Healthcare EFT Standard
(via ACH)
Virtual Card
Wire Transfer
Funds Availability
Next Day
2-3 Business days (via ACH)
Same Day (funds irrevocable)
Average Cost
$0.34 (any payment value)
Percentage of total payment
(avg. 3%) plus a transaction
fee
$10.73 (any payment value)
Enrollment/Acceptance
Must have a bank account
One time with each health
plan
Must have a bank account
One time with each health
plan
Risk
Very low risk with ACH credit
payment
Must have a bank account
and agreement with a
merchant card processing
provider, and point of sale
processing system/terminal
Higher risk with virtual cards
Manual processing for
each payment
None
Each payment must be
manually entered into the
POS terminal by office staff
None
Reassociation with
Electronic Remittance
Information
Standardized inclusion of
TRN Reassociation Data
Segment in payment
Not included with payment
Manual access to each EOB
through web portal
No requirement to include
TRN Reassociation Data
Segment with payment
Very low risk with immediate
payment
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
29
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
Using Healthcare EFT Standard (CCD+) Delivers
Significant Cost Savings to Providers
Example of Acceptance of Different EFT Payment Types for
$2,500 claim payment
EFT Payment Type
Average Quoted Price
ACH CCD+
Must include TRN
Reassociation Data Segment
*ACH Deposit plus Addenda to
$
Business Account
Virtual Purchasing Card
**Per transaction fee
Interchange fee
0.34
No TRN Reassociation Data
Segment
$
0.10
1.90%
Wire Transfer
May include the TRN
Reassociation Data Segment
*Received wire transfer
$10.73
• Provider acceptance of ACH CCD+
addenda deposit for any value - $.34
• Payer claim payment of $2,500 made
via a Virtual Purchasing card (at
Commercial Data Rate 3 interchange)
would generate a fee of:
•
•
•
$47.50 (interchange – 1.90%)
$00.10 (transaction fee)
$47.60 Total fee to accept card payment
• Provider receipt of a wire transfer for
any value - $10.73
*The Blue Book of Bank Prices 2012-13 published by Phoenix-Hecht - https://www.phoenixhecht.com/treasuryresources/PDF/BBExecSumm.pdf
** Card fees published by MasterCard- http://www.mastercard.com/us/merchant/pdf/MasterCard_Interchange_Rates_and_Criteria.pdf
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
30
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
Facts Behind the Virtual Card
Process
• Health plans fax, email or mail the
payment information to the Provider
•
Provider will manually process the
claims payment through POS terminal
Cost Considerations
• Virtual card shifts the costs of payment
processing from the health plan to the
provider
•
Providers pay interchange fee and per
transaction charge
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
31
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
Advantages to Virtual Cards
• Providers do not have to enroll with each individual
health plan to receive virtual card payments
• Easy way to receive claims reimbursement payments
from health plans not frequently used
• Hospital in Steamboat Springs, CO indicated as a resort
town they have patients from all over the world and many
health plans that they will receive payment from only a few
times a year. The virtual card helps to facilitate the receipt
of these payments
• If virtual card number is lost or stolen it can be replaced
by the health plan (standard card program rules).
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material
is not intended to provide any warranties or legal advice and is intended for educational
purposes only.
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
Disadvantages of Virtual Cards
• Expensive for providers to accept virtual card payments
•
Providers pay interchange fee and per transaction charge
• Shift the costs of payment processing from the health plan to the
provider
• Most vendors will rebate a percentage of the interchange fee and/or
transaction fees paid by the provider back to the health plan
• Providers must manually process the payment by keying the virtual
card number into the office POS terminal
• If amount of the payment is keyed incorrectly the virtual card is void
and must be replaced by the health plan
• Cannot receive a HIPAA compliant ERA (X12 835) with a virtual card
transaction
• Funds are deposited to providers merchant account in 2-3 business
days after processing (via ACH)
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material
is not intended to provide any warranties or legal advice and is intended for educational
purposes only.
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
Things to consider
•
•
Interchange fee paid by Providers is based on Provider agreement with
Merchant Bank
Are your receivables clerks already accepting virtual card payments
from health plans
• Major hospital group “discovered” their receivables clerks were accepting
virtual card payments from health plans and the hospital paid over
$2,500,000 in interchange fees before the treasury department identified the
reason their merchant card fees has increases significantly and stopped the
practice
•
If you have a lockbox, is the lockbox accepting virtual card transactions
in place of checks
• Some health plans are not asking, but mailing the virtual card information to
the providers lockbox instead of a check
•
Providers are under no obligation to accept virtual card payments for
corporate claims reimbursement because the practice accepts card
transactions for patients
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
34
SIMPLIFYING PAYMENTS WITH THE
HEALTHCARE EFT STANDARD
How do I start using the
Healthcare EFT Standard?
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
35
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
4 Steps to Receiving Plan Payments via the
Healthcare EFT Standard
1. Contact health plan and
choose the healthcare EFT
standard.
2. Provide payment
information to health plan.
3. Receive payments directly
in your bank account.
4. Contact your bank to
receive the Reassociation
Trace Number directly.
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
36
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
Partner with Financial Institutions to Expand
Opportunities
ACH and Treasury Management Services
Increase electronic patient payments
• Become an ACH Originator
–
Collection of outstanding Patient
obligations
Improve back office administrative
processes
• Reassociate remittance information with
payment
Reduce payment risk
• Prevent unauthorized debits to account
– Debit Filter or Debit Block
– ACH Positive Pay
– Account masking (UPIC)
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
37
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
What Can Financial Institutions Do for Providers?
• Some financial institutions offer solutions to process claim payments
with image to EDI technology for claims payments PLUS ERA
retrieval and reassociation services.
Bank
Receivables
Service
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
38
SIMPLIFYING PAYMENTS WITH THE
HEALTHCARE EFT STANDARD
How can I learn more?
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
39
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
NACHA Informational Resources
Resource
Details
Healthcare Payments Resources Website
https://healthcare.nacha.org/
Health ePayments News
Quarterly newsletter
Sign up at https://healthcare.nacha.org/
Healthcare EFT Standard
Implementation Guide
•
•
•
•
What is the EFT standard?
How does it work?
How do I populate the specific fields?
What are NACHA Operating Rules and how do they
impact the standard?
https://www.nacha.org/eStore
ACH Primer for Healthcare
•
•
•
•
•
Introduces ACH payments
Defines ACH Network, participants and transaction flow
Outlines benefits of moving to EFT
Describes changes to the NACHA Operating Rules to
support healthcare EFT transactions
Compares EFT payment options
https://healthcare.nacha.org/ACHprimer
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
40
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
Additional Resources
• AMA EFT Toolkit - www.ama-assn.org/go/eft
• AMA Administrative Simplification LinkedIn Group
• CAQH CORE EFT & ERA Operating Rules http://www.caqh.org/CORE_phase3.php
• CAQH EFT Enrollment Database http://www.caqh.org/eft_enrollment.php
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
41
SIMPLIFYING PAYMENTS WITH THE HEALTHCARE EFT STANDARD
Additional Resources
• WEDI (Workgroup on EDI)
• NACHA Operating Rules Healthcare Updates and their Impact
to Providers and Health Plans
–
Provides background and detailed information on the NACHA Operating Rules updates and their
impact to health plans and healthcare providers
• Implementing a Healthcare Payment EFT Process to
Accompany a Healthcare Claim Payment Remittance Advice
–
–
Provides background and detailed information for health plans and healthcare providers on what is
needed to implement EFT
Includes checklists for both health plans and healthcare providers
• EFT and ERA Enrollment Process
–
•
Provides background on the requirements of CAQH CORE Rules 380 and 382, along with
information for health plans, healthcare providers, and vendors to implement these requirements.
http://www.wedi.org/knowledge-center/documents/white-papers
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material is
not intended to provide any warranties or legal advice and is intended for educational purposes only.
42
SIMPLIFYING PAYMENTS WITH THE
HEALTHCARE EFT STANDARD
Questions
Priscilla Holland
pholland@nacha.org
© 2013 NACHA — The Electronic Payments Association. All rights reserved.
No part of this material may be used without the prior written permission of NACHA. This material
is not intended to provide any warranties or legal advice and is intended for educational
purposes only.