CMS Clarifies HIPAA Contingency Plans for Transactions and Code Sets
From Health Data Management (September 10, 2003)

The Centers for Medicare and Medicaid Services has shed light on how payers can implement contingency plans to ensure continued processing and payment of claims in the hectic period following the Oct. 16 compliance date for the HIPAA transactions and code sets rule. The clarification--expanding on recent guidance the centers issued--shows substantial flexibility in the types of contingency plans that are acceptable. For instance, the centers will permit payers to implement contingency plans the payers believe are appropriate, including the processing and payment of non-HIPAA compliant claims, or giving providers interim payments pending full adjudication of their claims. The centers also clarified the "good faith" efforts toward compliance that payers must show. Further, the Medicare program will decide by Sept. 25 whether to implement its own HIPAA contingency plan, which would include accepting HIPAA compliant and noncompliant claims for a certain period.

The clarifications are in eight new “answers” in the centers' Frequently Asked Questions section of the HIPAA administrative simplification Web site, In response to a question about what constitutes an acceptable contingency plan, the centers' responded:

"An acceptable contingency plan is whatever is appropriate for the individual plan's situation in order to ensure the smooth flow of payments. Health plans will need to make their own determinations regarding contingency plans based on their unique business environments. A contingency plan could include, for example, maintaining legacy systems, flexibility on data content or interim payments. Other more specific contingency plans may also be appropriate. For example, a plan may decide to continue to receive and process claims for supplies related to drugs using the NCPDP format rather than the 837 format currently specified in the regulations. The appropriateness of a particular contingency or the basis for deploying the contingency will not be subject to review."

Health payers should announce their contingency plans as soon as possible, according to the clarification. "In deciding whether to deploy a contingency plan, organizations would have to make an assessment of their outreach and testing efforts to assure they made a 'good faith' effort."

Posted to HIPAAcomply 9/10/03