According to the Department of Health and Human Services, HHS, this lack of standardization:
- makes it difficult and expensive to develop and maintain software; and
- reduces the ability of health care providers and health plans to achieve efficiencies and savings.
Transferring information in an electronic fashion can eliminate the inefficiencies of handling paper documents, as well as providing an opportunity for both parties to reduce administrative burden, lower operating costs, and improve overall data quality.
In order to ensure the efficiency of this process, HHS has adopted record formats for certain transactions. These record formats are called "standards". The standards specify the format, data content and code sets to be used for each transaction. Covered entities, which are required to use these standards, are prohibited from altering these standards when exchanging data.
By using these transaction standards, we now have the ability to exchange information in a fast and cost-effective way.
The HIPAA EDI Rule defines 3 groups, referred to as Covered Entities that must comply with the HIPAA EDI Rule. The Covered Entities are Health Plans, Health Care Clearinghouses, and Health Care Providers.
We are a Health Plan when conducting business activities for certain of its products, called "covered products." The majority of our products are exempt from the HIPAA EDI Rules. For example, Long Term Disability (fully insured and self insured), Short Term Disability (fully insured and self insured), Life and Accident coverages are all excluded. Products that are "covered products" include long term care, expense base cancer, hospital confinement, dental, vision or intensive care policies, certain medical coverages and other health plans pursuant to the Health Insurance Portability and Accountability Act ("HIPAA")
We have the ability to conduct the HIPAA regulated transactions with respect to its covered product when required to by the regulation. At this time, we cannot support HIPAA EDI transaction standards for the remainder of our portfolio.
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