5010 required by January 1, 2012

  • By
  • In CMS
  • June 10, 2009
  • Comments Off on 5010 required by January 1, 2012

CMS held a conference call presentation on 5010 Implementation with Chris Stahlecker and Lorraine Doo, CMS, Office of Information Services, as the speakers. During their presentations they made the following main points.
Need for 5010 Conversion

  • More than 5 years since initial implementation, but 8 years since balloting of the current version
  • Many situational and required rules did not fit business practices of the industry
  • Industry relied too extensively on companion guides, limiting value of standards
  • Many transactions were not implemented at all because of limited utility and value.

Why 5010 is an Improvement over 4010

  • Includes structural and content oriented changes
  • Incorporates more than 500 change requests
  • Resolves ambiguities in situational rules
  • Provides more consistency across transactions – most rules are the same throughout the suite
  • Shortcomings have been addressed to increase value of transactions such as referrals and authorizations.

Policy features of HIPAA Modifications Rule
Mandatory compliance on January 1, 2012 – all covered entities

  • Internal Testing to begin on or after January 1, 2010
  • External testing to begin on or after January 1, 2011

No entity may require another entity to use the new version of the standard without agreement between the two parties for testing and implementation.
Ability to use X12 or NCPDP for retail pharmacy supplies and services

  • Supports existing industry practice
  • Requires agreement between trading partners

Compliance date for Version 3.0

  • Mandatory compliance on January 1, 2012 – all covered entities except small health plans which have until January 1, 2013.

Benefits of Conversion: 5010/D.0/3.0

  • Less ambiguity in the TR3 (guides)
  • Enhanced usability and usefulness of certain transactions such as referrals and authorizations (X12 and NCPDP)
  • Improved utility of the NCPDP standards, compliance with Part D requirements
  • Reduces reliance on companion guides
  • Supports increased use of EDI between covered entities
  • Supports E-Health initiatives now and in the future
  • Version 3.0 provides standard method of recouping State

Medicaid funds paid inappropriately
Who is Affected by the Change to 5010
All HIPAA Covered Entities:

  • Providers
  • Health Plans
  • Clearinghouses

Business Associates of Covered Entities that use the affected transactions including Billing/Service Agents
When are You Required to have System Changes Implemented?

  • January 1, 2012 is the cut off date for the old transactions
  • Medicare will be ready to begin transitioning on January 1, 2011

What MUST be Changed?

  • The formats currently used must be upgraded from X12 Version 4010A1 to 5010 and from NCPDP 5.1 to D.0
  • Systems that submit claims, receive remittances, exchange claim status or eligibility inquiry and responses must be analyzed to identify software and business process changes
  • The new versions have different data element requirements
  • Medicare has performed a comparison of the current and new formats for the transactions used and they can be found at www.cms.gov/ElectronicBillingEDITrans/18_5010D0.asp
  • Software must be modified to produce and exchange the new formats
  • Business processes may need to be changed to capture additional data elements now required
  • Transition to the new formats must be coordinated:

Continue to use the current formats for some Trading Partners’ exchange
Start to use the new formats with other Trading Partners
What Claims does Medicare Process

  • Medicare FFS processes the following ASC X12 version 4010 and4010A1 transactions:
    • Institutional Claim (837-1)
    • Professional Claim (837-P)
    • Claim Status Inquiry and Response (276, 277)
    • Eligibility Inquiry and Response (270, 271)
    • Remittance Advice (835)
    • Transaction Acknowledgement (TA1)
    • Functional Acknowledgement (997)
  • Medicare also processes DME Claims in the NCPDP version 5.1

Scope of HIPAA 5010
“Infrastructure” preparation for ICD-10

  • Diagnosis codes require a “Y2K-like” expansion of the claim
  • New ASC X12 standard acknowledgement and rejection transactions
  • Selected systems and process enhancements that move Medicare FFS processing towards modernization

New ASC X12 standard acknowledgement and rejection transactions

  • The Functional Acknowledgement 997 is being replaced by the 999 transaction
  • The Claims Acknowledgement (277-CA) will be used to replace proprietary error reporting

HIPAA 5010 Scope vs. ICD-10 Scope
The HIPAA 5010 project is a pre-requisite for the ICD-10 project

  • What 5010 DOES do:
    • Increases the field size for ICD codes from 5 bytes to 7 bytes
    • Adds a one-digit indicator to the ICD code to indicate version 9 v 10
    • Increases the number of diagnosis codes allowed on a claim
    • Includes some of the other data modifications in the standards adopted by Medicare FFS
  • What 5010 DOES NOT do:
    • Does not add processing needed to use ICD-10 codes
    • Does not add a crosswalk of ICD-9 to ICD-10 codes
    • Does not require the use of ICD-10 codes

The 5010 format allows ICD-9 and/or ICD-10 CM & PCS code set values in the transaction standard.
The business rules for using ICD-10 code set values will be defined with the ICD-10 project.

MAC (Medicare Administrative Contractor “FRONT ENDS”
Each MAC runs a different Front End system at their own local data center, and exchanges transactions with their adjudication system running Enterprise Data Center (EDC)
MACs must update their Front End Systems’ translator and trading partner management system that performs authentication, validation
and exchange of the standard transactions
MACs must also plan for and implement software developed by FISS and MCS to perform detailed claim editing and numbering and receipt, control and balancing for EDC exchanges
The project approach is to upgrade Group 1 MACs first (J1, J3, J4, J5,
J13 and CEDI), and subsequently to address the MACs in transition
A “certification” test will be executed by each MAC prior to initiating their Transition Phase
MACS will coordinate an information exchange within their Jurisdictions to address:

  • Whether a new Trading Partner (Submitter ID) will be required
  • The steps to transition from the current formats to the new

    • Requirements for testing each transaction
    • Testing procedures per each transaction
    • Clearinghouse and vendor test support
  • List of vendors who have completed testing

What Steps Should You be Taking Now
Contact your system vendors

  • Does your license include regulation updates
  • Will the upgrade include acknowledgement transactions 277CA & 999?
  • Will the upgrade include a “readable” error report produced from these 277CA and 999 transactions?

Inquire when they are planning to upgrade your system


  • Assess this response to be sure your vendor can assure your transition well before the cutoff, Jan 1 2012

Evaluate the impact to your routine operations and begin planning for training, transition

No Responses to “5010 required by January 1, 2012”

  1. JaneRadriges says:

    Hi, gr8 post thanks for posting. Information is useful!

  2. P WILLIAMS says:

    thanks for the news about the upcoming changes with 5010.

  3. GarykPatton says:

    Hello. I think the article is really interesting. I am even interested in reading more. How soon will you update your blog?

  4. Lisa A. Mauro says:

    Thank you for this very informative article. I thank the AAPC for always providing a wealth of information, to help guide its members in this ever changing and challenging field of coding.

  5. regina murray says:

    This is a very informative article.

  6. steve lang says:

    Thanks for the info. I am trying to find out what codes to submit in place of deleted codes, and what the data conditions are that require the new code. An example would be CRC*75*Y*IH where the IH code is deleted and will be replaced with AV, NU, S2 or ST. This is only one example among many and I am trying to learn where I can find out which of the new codes to use and what conditions would require that code.
    Any info would be appreciated.

  7. Kalon Mitchell says:

    In a transcript of this meeting (page 30), Chris Stahlecker is asked if providers new to the Medicare program after 4/11 will be required to use the 5010 format. His answer was yes, regardless of if they sent direct or used a clearinghouse. How can this be correct? This would require the vendor to be live on 5010 8 months prior to the actual deadline, or the provider to wait 8 months to submit claims. Does anyone know the answer to this issue and where it might be documented? I can’t find anything to substantiate this but I have customers that use our direct transmission software demanding to be in production by 4/1/11.

  8. Transaction Acknowledgements says:

    We would like to announce that there is a new software called HIPAA Acknowledgement Report Viewer that you can drag and drop both the new 999 and 277CA acknowledgement files and it will translate them into easy to read reports. To check it out, visit http://www.lhsoftwareconcepts.com.