What is a 4010, a 5010 and Why Should I Care?

Out of the Big Attention Getters in our industry these days – Electronic Health Records, ICD-10 and the 5010 format – the one with the deadline coming up quickest is the 5010 format.

Who do these changes affect?  What is a “4010” and “5010” anyway?  Should I care?  Well, I would say anyone concerned about cash flow or prescribing electronically should be concerned.

Some roles that should be concerned are Billing Managers, Practice Administrators and Physicians.  As far as Physicians go, I’m generally not talking about those of you that are an employee of a large organization.  Someone else in the practice is probably taking care of this for you (we sure hope).  I’m talking to those that are their own boss; those that have to make the decisions and/or write the check.

History

Whether you realize it or not, the electronic transactions that today flow into and out of your practice management system, as well as any electronic prescribing you do, is all currently governed by the Accredited Standards Committee X12 Version 4010/4010A1 for health care transactions and the National Council for Prescription Drug Programs (NCPDP) Version 5.1 for pharmacy and supplier transactions.  These were set in place by the 1996 Health Insurance Portability and Accountability Act we all know and love as “HIPAA”.

On January 16, 2009, the United States Department of Health and Human Services (HHS) published the new rules to replace the formats that have been in use for the last many years.

These new rules are:

• Version 5010 for health care transactions (replacing Version 4010/4010A1)
• Version D.0 for pharmacy and supplier transactions (replacing NCPDP Version 5.1)

Should I Care?

You should probably only care about these things if they affect you.  Problem is, it affects many, many organizations in the health care arena.  Of course, if you’re reading this, there is a good chance it does.  The change from 4010 to 5010 affects “Covered Entities”, which include:

• Certain Health Care Providers (actually most physician practices across America plus others)
• Health Plans
• Health Care Clearinghouses

The change from NCPDP 5.1 to D.0 affects:

• Anyone dealing with Pharmacy and Supplier Transactions

What type of transactions does it cover?  Well, some VERY IMPORTANT ones, such as:

• Claims (read CASH FLOW!)
• Claims status requests and responses (again, read CASH FLOW!)
• Payment to Providers (again, read CASH FLOW!)
• Eligibility requests and responses (don’t want to do work for FREE do you?)
• Referral requests and responses (keep those relationships intact)
• Enrollment and disenrollment in a health plan
• Coordination of Benefits and premium payments (once again, read CASH FLOW)

If you read the list above, you may have noticed the words “CASH FLOW”.  I’m not sure about you, but I really like to have cash flow.  I hope you’re like me and would like to make any change that is necessary to maintain a positive cash flow.

So, Why The Change?

So why is everyone so big on changing this up?  Well, as hard as everyone worked back in the Nineties and leading into the big Y2K at putting a standard in place that would last forever, it didn’t. 

What has happened is that there are many situations, as you can imagine, that could not be anticipated and that the current standards just don’t handle very well.  As a result, many payers and other organizations that must use these standards “force-fit” situations that aren’t handled well.  I can tell you as head of a software company that deals with these transactions all the time, we are constantly taking on the burden of handling these “force-fit” situations to make sure our clients don’t suffer because of them, particularly when it comes to cash flow.  In fact, vendors all across America are constantly making adjustments for these (some better than others).

Now that we’ve had several years to look at these situations, the new format will handle more situations in a much better and more standard way.  Will the new formats last forever?  Of course not!  But they should get us through many more years.

The other big deal about the 5010 transactions is that it creates the foundation for ICD-10, which will not go into effect until year 2013.  That may seems like a while to you, but anyone that has kids knows two years isn’t that long!

Now What – What Is MY Responsibility?

So, what is MY responsibility in all of this?  Well, when it comes down to it, educating yourself on why the change exists and if it affects you is the first step.  Of course, by reading this, you are on your way – congratulations! 

The other big part of your responsibility is making sure your software properly supports the new transactions.  If your software vendor is not communicating with you regarding these changes, it is now time for you to reach out to them to find out what the plan is. 

Your responsibility is also to watch for communications from your vendor(s).  As a software vendor of EMR, Practice Management and related services, I can tell you that it is many times VERY difficult to get a message through to the decision-makers in a practice.  Please make sure your staff watches for and alerts you to vendor communications.

You’ll want to make sure of at least the following:

• Does your vendor know about and is on top of these changes?  (If not, look for another vendor – NOW!)
• When will the changes be ready?
• What are the charges to me for the changes to be put in place?
• When the changes are put in place, will there be an interruption to my practice?
• Do I need to plan for staff training related to the changes?

If you hit December 31, 2011 with no solution in place, one of two things has happened – your vendor blew it or you did.  Your vendor mislead you (because, of course, you checked things out with them, right?), or you did not do your due diligence and make sure you were covered, or you purposely decided NOT to keep your system up-to-date.

Are There Any Workarounds Other Than Updating My Software?

There are “probably” temporary workarounds to your software not handling the new changes.  This would be through a Clearinghouse, which is basically like the post office for your claims.  Most systems today send at least a portion of electronic claims through a Clearinghouse.  We at HealthTec work with several and have been in contact with many of them.

It looks like many Clearinghouses will be able to, at least for some period of time, do a conversion of the old format to the new.  However, there is no guarantee that your system will send them all required information to perform the conversion or for how long they will be willing to maintain a conversion.

Make sure and talk with your software vendor and/or your Clearinghouse regarding this if it looks like you will not, for some reason, have the required changes in place by December 31, 2011.  Even if you plan on using a Clearinghouse to make up for deficiencies in your own system, it should be viewed only as a temporary fix.

That’s It, For Now

I hope this has been helpful to some.  Please feel free to contact us for further information about our products and services, or just to chat about these changes.

Best regards,

Vance Nelson
President/CEO
HealthTec Software, Inc.

About HealthTec Software, Inc:

HealthTec Software, Inc. is a national supplier of unique software technology and related services covering all aspects of electronic health records and revenue cycle management.  To find out how HealthTec Trilogy can adapt to your workflow, help achieve Meaningful Use of a Certified Electronic Health Record and help keep track of insurance payer behavior, please contact us at:

HealthTec Software, Inc. / 210.545.1010 or 800.821.6054 / www.healthtec-software.com

 Credits:

Distilled from Centers for Medicare & Medicaid Services website (www.cms.gov) as well as numerous conversations with colleagues and other industry professionals.