By J. Christopher Walsh, Principal at Arlington Associates, Inc.
Even though electronic health care payments have existed for almost 30 years, their adoption rate has languished well below ten percent and been largely limited to inpatient facilities. However, the last several years have seen new events that are likely to change this dramatically.
Paper checks have become significantly more expensive as banks have raised commercial fees in response to consumer revenue lost to Federal regulation. Saturday postal service will cease in August, 4,000 smaller post offices are scheduled to close, and the cost of 1st class mail has risen seven times in the last decade. Those expensive checks will take then even longer and cost more to deliver.
In May 2011, the Federal Government converted all new recurring health care and other benefit check payments to debit cards. Check payments to remaining beneficiaries will be converted to cards later this year making ongoing Federal beneficiary checks a thing of the past.
While the Patient Protection and Affordable Care Act (PPACA) has brought major health care issues into the mainstream in a way not seen in a generation, it contains many lesser known mandates. In addition to electronic health records (EHR), key requirements include payors and providers moving towards making and receiving electronic payments. The Act specifically endorses electronic funds transfer (EFT) coupled with 835 payment data as well as debit cards.
Last summer, by a 5 to 4 margin, the US Supreme Court upheld the constitutionality of the PPACA and November’s presidential election upheld it politically. Many who opposed the Act now realize it’s not going away and have turned their attention to its implementation.
Even those people still at odds over the Act’s funding, underwriting, and mandatory participation can agree it establishes a Federal payment standard that would benefit all health care, including services delivered under workers’ compensation and auto coverage. Just as the Federal HCFA physician and UB hospital billing forms have established a billing standard in health care, so too the PPACA’s ePayment mandate will establish a national standard allowing for rapid adoption.
Unlike most of the Act’s other mandates, ePayment technology is in place today. Those providers who don’t want or can’t handle EFT and 835 data can receive secure detailed payment through their office bankcard terminal. And those who still insist on checks can get them… at least for now.
The Act’s January 1, 2014 electronic payment implementation deadline will likely be delayed, but not before there’s a major shift away from paper payments…