There is much noise now about the file version called 5010. What is 5010 and what does this mean to my Pediatric Practice? Claims are transmitted in a file format from practice management/billing systems to insurance companies. The current format is known as 4010. Vendors of software need to be able to adhere to these standards to successfully transmit claims to clearing houses/insurance companies (so the practice can receive payments for services). New requirements in the Patient Protection and Affordable Care Act of 2010 should improve the functionality of sending claims via 5010. This file format change impacts insurance companies, practices, clearing houses and software vendors that provide software for Medical Billing. The goal/reason for the change is an effort to reduce the administrative burden on Physician Practices. Some of the projected benefits include:
• Creation of an electronics funds transfer (EFT) transaction standard as well as operating rules. This should help with matching ERAs and EFT transactions (there are many ‘holes’ in the current standard within the industry which makes tracking payments more challenging).
• Implementation of an electronic claim attachment standard and national plan identifier (NPID)
• Requirement for Health and Human Services to solicit input from providers on administrative items including whether the application for enrollment of Health Care Providers by health plans could be completed in an electronic method.
• Adoption of common approaches to administrative transactions by Health Plans.
• Clarification of a transaction standard.
Currently, authors of articles published in Connexion (a monthly magazine published by MGMA), site that there is inconsistent and non-uniform use of more than 1000 claim adjustment reason codes and remittance advice remark codes. ERAs have been sent by Health Plans for which adjustments are documented incorrectly. Many practices have a difficult time matching EFTs to the ERA files. The conversion to 5010 should help with some of these issues. PhysicianXpress is currently ready and certified for 5010 transactions (ahead of the 1/1/12 due date).
The revenue cycle is very complex which needs to be maintained and managed continuously for a practice to receive consistent and optimal revenue streams. Some billing companies have a low fee but they do not manage the revenue cycle (many only upload claims to the clearing house/insurance companies without follow-up on denied or underpaid claims). There is a major difference from uploading claims to managing the revenue cycle. This is why performance to benchmarks (e.g. collection rate to the contract amount) is so important.
What do you need to do as a practice owner related to 5010? If you use a revenue cycle management service by a professional team, very minimal. If your practice manages all the internal processes then there is a check list of 10+ items that need to be completed. These include: reviewing the processes of the practice, verifying that each component in the revenue cycle is 5010 ready (clearing houses/insurance companies/billing software) and validated, identify if the practice will incur extra cost in software, transaction fees and training from the practice management software, identify if time to switch systems for the practice and/or start on an E.H.R. system.