CMS delays non-compliant claims by 13 days

Monday, July 5, 2004

July 6, 2004

BALTIMORE - Electronic Medicare claims that do not meet HIPAA standards will be treated as paper claims and paid more slowly than HIPAA-compliant electronic claims starting tomorrow, according to CMS Administrator Mark B. McClellan.
"The great majority of electronic claims we are receiving meet the required HIPAA standards," McClellan said, "but for the those still not in compliance there is going to be a delay in getting their money.  We are hoping this will motivate more filers to get into compliance soon."
Under a modification to its HIPAA contingency plan announced in February, non-compliant electronic claims will still be accepted by Medicare, but their payment will take 13 additional days.  The modification had an effective date of July 1, but CMS has said it would begin delaying payments for non-compliant claims submitted on July 6 and thereafter.
"By working collaboratively with health care providers on the use of standard electronic claims, we've been able to reach 90% compliance," McClellan said.  "Now, a two-week payment delay is an important further incentive to get to 100 percent."
HIPAA requires that health care claims submitted electronically be in a format that complies with the applicable electronic transaction standard adopted for national use.  While the HIPAA electronic transaction standards that were adopted apply to all covered transactions by covered entities, this modification to the CMS compliance plan will only affect covered entities submitting Medicare claims to a Medicare contractor.
By law, Medicare pays compliant electronic claims no earlier than the 14th day after the date of receipt. Non-electronic claims cannot be paid earlier than the 27th day after the date of receipt.  By treating non-compliant electronic claims as paper claims, Medicare will pay them 13 days later than compliant electronic claims.