CMS Delays 5010 Enforcement Another Three Months

March 15, 2012

Providers will now have until June 30 to make the switch before being penalized.

CMS has decided it will not enforce the use of Version 5010 HIPAA transaction standards for an additional three months. 

On Thursday, the agency’s Office of E-Health Standards and Services announced it would not take action against practices and other healthcare organizations not using 5010 until June 30, according to reports.

This is the second 5010 delay in the last few months by the agency. CMS had initially announced November 17 that it would not enforce penalties for 5010 noncompliance until March 31. At that time, CMS noted that the compliance deadline of Jan. 1, 2012, was still in effect, and that the Office of E-Health Standards and Services, which is in charge of enforcing 5010, would accept complaints associated with compliance with 5010 during the 90-day period beginning on that date.

News of the second 5010 enforcement delay comes on the heels of a mid-February announcement by HHS Secretary Kathleen Sebelius that her agency will initiate a process to postpone the original Oct. 1, 2013, ICD-10 compliance date.

Delaying 5010, which is necessary to input and transmit ICD-10 codes, has been advocated for several months by medical groups representing physician practices, notably the AMA and Medical Group Management Association (MGMA).

In fact, just yesterday the AMA sent a letter to acting CMS Administrator Marilyn Tavenner asking for a second 90-day extension.

“Despite the 90-day grace period, we remain concerned about the industry’s state of readiness for full Version 5010 compliance at this time,” said AMA CEO James L. Madara, in the letter. “We specifically have concerns that many physicians have reverted back to the Version 4010 transactions in order to have their claims processed and to receive payment, and these physicians will experience problems when they attempt to transition back to the Version 5010 transactions on April 1, 2012.”

Respondents to a recent survey by the MGMA estimated that upgrading to HIPAA 5010 could set them back $16,575, and 45.2 percent of practices said that they had not yet started the implementation of software upgrades necessary for HIPAA 5010.

Madara also stated that his organization is continuing to hear from physicians that there are still processing and payment problems resulting in their lack of payment since their transition to the Version 5010 transactions.

“Many of these impacted physicians are facing dire financial situations in which they are struggling to meet their financial obligations,” Madara’s letter stated. “While we understand from our recent conversation with Medicare representatives that recent Medicare Part B claims processing rates for the 5010 transactions is 92.4 percent, the remaining 7.6 percent represents hundreds of thousands of claims that are not being paid and are resulting in cash flow problems for physicians and other health care providers and potential interruptions in patient care.”