Big Brother Versus the Integrity of Healthcare Data

In my previous article, we discussed the issues surrounding the National Provider Identifier (NPI) and the Health Plan Identifier (HPID). The NPI has been successfully implemented, the HPID is delayed indefinitely. The last required identifier remaining to be implemented from the original HIPAA legislation is the National Patient Identifier (also NPI) sometimes referred to as Master Patient Index (MPI). The intent of this code set is to create and assign a unique ID to every patient who receives healthcare in the United States.

This code set is intended to address the “holy grail” of healthcare IT, the ability to relate patient data for an individual collected by different entities and for different encounters into a single integrated medical record. The benefits of this achievement seem fairly obvious. Clinical data could be shared and updated by all providers interacting with a patient. The quality of care would improve and medical mistakes would be reduced.

master patient index

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The National Health Plan Identifier – A Lesson in Restraint

The administrative simplification portion of the HIPAA legislation was intended to modernize healthcare transactions by creating a uniform data exchange that could be implemented by all healthcare business partners.  As a result, new EDI transaction standards like 837 (claims) and 835 (payments) were introduced. In addition to this, HIPAA also called for standardizing specific code sets in these transactions that were previously unique by health plan. Most of these changes were quickly adopted by healthcare business partners who were eager to find common ground.

However, there have been a few significant exceptions. It took several years for health plans to give up their own unique codes used to identify healthcare providers and replace them with the standard NPI (National Provider Identifier).  Now, NPI is used by all healthcare business partners for identifying providers electronically and this advancement alone has made systems using this data more efficient and easier to maintain. HIPAA included two other mandatory numeric ID code sets that were to replace any existing proprietary counterparts used for the same purpose.  These two code sets are the Health Plan Identifier (HPID) and the National Patient Identifier (also NPI).  Neither of these have been implemented, but for different reasons.  In this article, we will review the current status of the HPID.

The drafted HPID code set system designated that all health plans fell into categories, controlling health plans, small controlling health plans, and sub health plans.  This lead to confusion about what these terms meant and which category was to be used by a specific health plan.  The most compelling issue blocking the implementation of this code set was the fact that the payer ID system used then and today is universally accepted by healthcare business partners conducting transactions that require the numeric identification of health plans.  Continue reading

Zen and the Art of Revenue Cycle Maintenance

In 1974, Robert Pirsig wrote a popular philosophical novel (Zen and the Art of Motorcycle Maintenance) that dealt with the concept that “Quality” and striving for perfection is an important practice and lifestyle that contributes to spiritual growth. The author felt that the metaphysical question “What is best?” is at least as important and the more popular “Why are we here?” He believed that beauty and personal gratification could be found in the effort of perfecting a process. In his book, he says “Quality is Buddha” and compares striving to improve a process to the scientific effort to determine “the truth”, like the effort to determine a unifying theory in physics. The author takes these grandiose metaphysical concepts and provides practical examples. He shows that changing your concept of your environment can create positive change. By looking at things in a new way, you can see things you did not see before and make things better.

In business, we often take the path of least resistance. We develop processes to support business transactions and then we repeat them over and over until they experience some sort of major failure that requires a correction. If someone asks, why do we do things this way? The answer is most often “this is the way it has always been done”. We rarely take the time to review our processes at a fundamental level and ask ourselves philosophical questions like “why do we do this?” or “is this the best way?”
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ANSI 278 – Services Authorization – The Lost HIPAA Transaction

In 1996, HIPAA introduced new required electronic formats for some of the common transactions used today for the processing of insurance claims and related activities. As I discussed in my last article, these transactions have had disappointing adoption rates considering how long they have been available and the benefit they would bring the industry if they were universally adopted.


When these standards were introduced with the initial HIPAA legislation, another electronic transaction standard was also included, the ANSI 278 – Request for Review and Response. This is also referred to as the “Prior Authorization” transaction. The intent of this standard was to create a uniform automated process for requesting the authorization of a specific service from a health plan prior to the delivery of the service. In the absence of the adoption of this standard, providers and health plans must participate in many different unique processes of obtaining this authorization that cause delays in the processing of claims and the frequent delivery of services that are never paid for by insurance.

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