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Stay On Top of 5010

It’s crucial to your ICD-10 plan.

The conversion to 5010 has gotten much less notoriety than that given to ICD-10, but to make ICD-10 work, you will first need to tackle 5010. The most widely recognized change in the 5010 electronic data interchange (EDI) architecture is the version indicator allowing EDI transactions to differentiate between ICD-9 and ICD-10. This, however, is only a small part of the reason why implementing 5010 is crucial to an organization’s overall ICD-10 plan.

Know Its History

The Centers for Medicare & Medicaid Services (CMS) Office of E-Health Standards & Services (OESS) is responsible for the policies and enforcement of the Administrative Simplification provisions for transactions and code sets and the National Provider Identifier (NPI) covered under the Health Insurance Portability and Accountability Act (HIPAA) of 2003.
HIPAA 5010 was adopted to replace the current version of the X12 standards that covered entities (health plans, health care clearinghouses, and certain health care providers) must use when conducting electronic transactions. Version 4010 is currently being used under HIPAA standards.
Simply put, transactions are electronics exchanges involving the transfer of health care information between two parties for a specific purpose, such as a health care provider submitting medical claims to a health plan for payment.
HIPAA named certain organizations as covered entities, including health plans, health care clearinghouses, and some health care providers. HIPAA also adopted certain standard transactions for EDI for the transmission of health care data. These transactions include:

  • claims and encounter information
  • payment and remittance advice
  • claims status
  • eligibility
  • enrollment and disenrollment
  • referrals and authorizations

Don’t Delay

If you haven’t initiated a plan to adopt 5010, it’s not too late, but there are key items that need your immediate attention. First, realize that 5010 is not just an information technology (IT) project. Second, understand that working with your vendors is an important part of the process.

  • Talk to your vendor, billing service, and/or clearinghouse about resources they have on the 5010 changes and how the changes and upgrades can be incorporated in your existing system. Find out how much additional training will be required for system users.
  • Talk to your vendors about testing timelines:

o   Jan. 1, 2011 Level I compliance—ability to process 5010 transactions for testing and transition with able trading partners

o   Jan. 1, 2012 Level II compliance—all HIPAA-covered entities must begin using 5010 transactions

o   Identify the data reporting changes and revisions that you should be aware of. Here are a few of the changes that may affect your practice:

  • You can no longer report a post office box in the Billing Provider Address field. Physicians who want their payments sent to a separate address will use the Pay-to-Provider name and address fields.
  • You must report a nine-digit ZIP code in the Billing Provider and Service Facility Location Address fields. This could pose problems for rural providers.
  • Transactions have been revised to allow the reporting of ICD-10 diagnosis and procedure codes.
  • A patient with a unique health plan member ID is now reported as the subscriber. Front office staff will need to be trained on these changes.
  • You can no longer report units of anesthesia time. Only minutes can be reported. Physicians need to verify that their systems only provide minutes for anesthesia time-based procedure codes that do not have a time period in the description, and work with vendors on any necessary solutions.

Your practice management system may need to be upgraded so it can capture the required 5010 data.

  • Work with your vendor to have the necessary practice management system upgrades completed.
  • Determine the costs for the vendor upgrades.
  • Complete internal testing of the upgrades to make sure your system can generate the 5010 transactions. Ask your vendor if they will complete the internal testing for you. Don’t forget the aforementioned important testing deadlines.
  • Work with your vendor to see what types of training they may have available for staff education.

Prepare for Disruptions

You may remember the NPI transition and its payment disruptions. Even if you are prepared internally for the 5010 transactions, there may still be unforeseen problems. For example, a problem with the transmission of transactions may cause delays of claims being received by payers and/or remittance advices and payments being received by practices.
Here are some additional steps you can take to sustain your practice’s revenue during those crucial first weeks after the Jan. 1, 2012 deadline:

  • Talk to your Medicare administrative contractor (MAC) about their advance payment policy. Ask about the format for a request, where to send a request, timeframes for money distribution, etc.
  • Talk to your commercial payers to see if they have any advance payment policies.
  • Establish a line of credit with a financial institution.
  • Save money during the next few months to help carry you over if necessary.

If you have not begun preparing for 5010, you must start right away. Compliance deadlines are not being pushed back; practices will suffer significant cash flow issues if they are not ready.


Even if you are prepared internally for the 5010 transactions, there may still be unforeseen problems with the transmission of transactions.

Rhonda Buckholtz, CPC, CPMA, CPC-I, CENTC, CGSC, COBGC, CPEDC, is the vice president of ICD-10 education and training at AAPC.

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