Title of Regulation: 16VAC30-16. Electronic Medical Billing (adding 16VAC30-16-10 through 16VAC30-16-80).

Statutory Authority: § 65.2-605.1 of the Code of Virginia.

Public Hearing Information:

August 7, 2018 - 1 p.m. - Commissioners' Conference Room, 333 East Franklin Street, Richmond, VA 23219

Public Comment Deadline: August 10, 2018.

Agency Contact: James J. Szablewicz, Chief Deputy Commissioner, Virginia Workers' Compensation Commission, 333 East Franklin Street, Richmond, VA 23219, telephone (804) 205-3097, or email james.szablewicz@workcomp.virginia.gov.

Basis: The Virginia Workers' Compensation Commission is promulgating this regulation in accordance with the provisions of § 65.2-605.1 of the Code of Virginia, per amendments added by Chapter 621 of the 2015 Acts of Assembly.

Purpose: The purpose of the regulation is to provide a legal framework for electronic billing, processing, and payment of medical services and products provided to an injured worker subject to the Virginia Workers' Compensation Act. The proposed regulation will expedite the submission, processing, and payment of bills for medical services rendered to injured workers pursuant to the Virginia Workers' Compensation Act utilizing nationally recognized standards.

Substance: The new regulation contains provisions addressing (i) formats for electronic medical bill processing; (ii) billing code sets; (iii) electronic medical billing, reimbursement, and documentation; (iv) employer, insurance carrier, managed care organization, or agents' receipt of medical bills from health care providers; (v) communication between health care providers and payers; and (vi) medical documentation necessary for billing adjudication.

Issues: The regulation is designed to assist workers' compensation payers and medical providers to promptly process payment of bills for medical services in Virginia workers' compensation cases, which is an advantage to the public and the Commonwealth. There are no known disadvantages to the public or the Commonwealth. The regulation does not require any reporting to or enforcement by the Virginia Workers' Compensation Commission or any other governmental agency.

Department of Planning and Budget's Economic Impact Analysis:

Summary of the Proposed Amendments to Regulation. Pursuant to Chapter 621 of the 2015 Acts of the Assembly, the Virginia Workers' Compensation Commission (Commission) proposes to adopt and implement an infrastructure that requires most providers of workers' compensation medical services to submit their billing, claims, case management, health records, and all supporting documentation electronically. As required by Chapter 621, this proposed regulation is consistent with the International Association of Industrial Accident Boards and Commission (IAIABC) Medical Billing and Payment guidelines. Consistent with IAIABC guidelines, health care providers will be exempt from these proposed requirements if they have 10 or fewer full time employees and treatment and services provided to injured workers billed under workers' compensation constitutes less than 10% of their practice.

Result of Analysis. Benefits likely outweigh costs for these proposed regulatory changes.

Estimated Economic Impact. Prior to this regulatory action, the Commission did not have rules for health care providers to submit workers' compensation bills and supporting documentation to insurers (payers) electronically. Commission staff reports that the General Assembly passed Chapter 621, which requires the Commission to "establish a schedule pursuant to which employers, employers' workers' compensation insurance carriers, and providers of workers' compensation medical services shall be required to adopt and implement infrastructure" for submitting billing, claims, case management, health records and all supporting documents electronically. Chapter 621 and this proposed regulation require that participating entities have this infrastructure in place no later than December 31, 2018. Commission staff reports that most bills and records are submitted in paper form now and most payments to providers are made via paper checks. The Commission now proposes a regulation that will:

1. Define terms and abbreviations.

2. Describe the electronic medical bill processing standards that are to be used for billings, acknowledgements, remittances, ancillary formats, and documentation transfers between providers and insurers.

3. Allow insurance carriers and health care providers to exchange electronic data in a non-prescribed format by mutual agreement or to use a direct data entry methodology so long as all of the required information is still collected.

4. State that when the prescribed formats are updated, the most recent standard would be required to be used by e-billing entities, once the new standard becomes effective as published in the Code of Federal Regulations.

5. List the billing code sets that are to be used in the e-billing system.

6. Describe the components of a complete electronic medical bill, including the correct format and a list of elements that must be identified.

7. Provide for acknowledgement of certain types of transactions including whether claims are complete or rejected, whether claims contain error codes, and prohibit the submission of duplicate electronic records.

8. Set timeframes for certain actions to occur.

9. Clarify that acceptance of complete and incomplete medical bills does not either admit liability or satisfy written notice requirements, but that it would begin the time period by which the payer must accept or deny liability and that it does serve as proof of the received date.

10. Specify the types of information that must be furnished electronically, including medical reports and records, bills, identification of the employee and medical providers, dates of service, and other specified types of data. 

11. Require that electronic documentation be submitted by secure fax, secure encrypted electronic email, or other secure electronic format as defined by the Virginia Administrative Code.

12. Clarify how electronic remittance advice and electronic funds transfers are to occur and establish timeframes for these processes.

13. Detail the requirements for paper medical bills for the small health care providers who are exempt from e-billing requirements.

14. Provide for resubmissions in the event that the payer has rejected the medical bill as incomplete.

15. Require the insurance providers to attempt to establish connectivity through trading partner agreements.

16. Prohibit the imposition of excessive fees in order to comply with the requirements of this section.

17. Allow health care provider agents to charge reasonable fees related to data functions.

18. List the obligations of employers, insurance carriers, managed care organizations, and agents when they receive medical bills from health care providers, including the evaluation of the bills, the received date of the bills, the payer's ability to contact the medical provider, the payer's discretion to accept or reject bills, and the payer's ability to request additional information. 

19. State that payment of all uncontested portions of a complete medical bill shall be made within a certain timeframe, and that amounts paid after that time shall accrue interest at the judgement rate of interest as established by Virginia Code § 6.2-302.

20. Describe how communication between health care providers and payers is to occur.

21. Clarify that medical documentation is necessary for billing adjudication and

22. Allow providers and payers the option to voluntarily comply with this chapter beginning six months after the publication of the final regulation in the Virginia Register of Regulations.

Affected health care providers and insurers will benefit from this proposed regulation as it will allow them to exchange information and resolve claims more quickly. Health care providers will additionally benefit from being paid more quickly via electronic deposit rather than having to wait for, and then physically deposit, paper checks. This action will likely decrease the costs incurred on billing activities that may now include copying costs to make paper copies of documents that providers are required to send insurers, time spent preparing and mailing documents and following up to make sure they were received, and time spent re-billing if payment decisions stretch beyond one billing cycle. Workers who are receiving health care services may also benefit if the exchange of electronic records allows their claims to be paid more expeditiously. Health care providers may incur costs for purchasing medical billing software that is capable of exchanging medical bill and records data securely, or for contracting with a clearinghouse to process their medical bill and records data for them. Commission staff did not have an estimate for how much it would cost to either buy software or hire a clearinghouse service. These businesses are unlikely to choose to incur these costs unless they perceive the benefits of providing health care in workers' compensation cases, and being able to be paid for those services more quickly via electronic funds deposits, to be greater than any costs they incur to meet the requirements of the proposed regulation.

Businesses and Entities Affected. This proposed regulation will affect all workers' compensation insurers and their third party administrators, self-insured employers and health care providers who provide covered services to individuals who have been injured on the job. Injured workers whose health care and other expenses may be paid for via workers' compensation claims will also be affected. Sellers of medical billing software and clearinghouse processing services may also benefit.

Localities Particularly Affected. No localities will be particularly affected by this proposed change.

Projected Impact on Employment. Employment in the Commonwealth is unlikely to be significantly affected by this proposed regulation.

Effects on the Use and Value of Private Property. This proposed regulatory change is unlikely to affect the use or value of private property in the Commonwealth.

Real Estate Development Costs. These proposed regulatory changes are unlikely to affect real estate development costs in the Commonwealth.

Small Businesses:

Costs and Other Effects. Small business medical practices may incur costs for purchasing medical billing software that is capable of exchanging medical bill and records data securely, or for contracting with a clearinghouse to process their medical bill and records data for them. These businesses are unlikely to incur these costs unless they perceive the benefits of providing health care in workers' compensation cases, and being able to be paid for those services more quickly via electronic funds deposits, to be greater than any costs they incur to meet the requirements of the proposed regulation.

Alternative Method that Minimizes Adverse Impact. There are likely no methods that would both meet the legislative mandate in Chapter 621 and further reduce costs.

Adverse Impacts:

Businesses. Private medical practices may incur costs for purchasing medical billing software that is capable of exchanging medical bill and records data securely, or for contracting with a clearinghouse to process their medical bill and records data for them. These businesses are unlikely to incur these costs unless they perceive the benefits of providing health care in workers' compensation cases, and being able to be paid for those services more quickly via electronic funds deposits, to be greater than any costs they incur to meet the requirements of the proposed regulation.

Localities. No locality is likely to suffer adverse impacts on account of this proposed regulatory change.

Other Entities. No other entities are likely to suffer adverse impacts on account of this proposed regulatory change.

Agency's Response to Economic Impact Analysis: The Virginia Workers' Compensation Commission concurs with the economic impact analysis of the Department of Planning and Budget.

Summary:

Pursuant to Chapter 621 of the 2015 Acts of Assembly, the proposed regulation implements infrastructure under which (i) providers of workers' compensation medical services (providers) submit billing, claims, case management, health records, and all supporting documentation electronically to employers or employers' workers' compensation insurance carriers (payers) and (ii) payers return actual payment, claim status, and remittance information electronically to providers that submit billing and required supporting documentation electronically. The proposed regulation establishes standards and methods for electronic submissions and transactions that are consistent with the electronic medical billing and payment guidelines of the International Association of Industrial Accident Boards and Commissions. The proposed regulation does not require any reporting to or enforcement by the Virginia Workers' Compensation Commission or any other governmental agency.

CHAPTER 16
ELECTRONIC MEDICAL BILLING

16VAC30-16-10. Effective date.

This chapter applies to all medical services and products provided on or after December 31, 2018. For medical services and products provided prior to December 31, 2018, medical billing and processing shall be in accordance with the rules in effect at the time the medical service or product was provided.

16VAC30-16-20. Definitions.

The following words and terms when used in this chapter shall have the following meanings unless the context clearly indicates otherwise:

"Business day" means Monday through Friday, excluding days on which a holiday is observed by the Commonwealth of Virginia.

"Clearinghouse" means a public or private entity, including a billing service, repricing company, community health management information system or community health information system, and "value-added" networks and switches, that is an agent of either the payer or the health care provider and that may perform the following functions:

1. Processes or facilitates the processing of medical billing information received from a client in a nonstandard format or containing nonstandard data content into standard data elements or a standard transaction for further processing of a bill related transaction; or

2. Receives a standard transaction from another entity and processes or facilitates the processing of medical billing information into nonstandard format or nonstandard data content for a client entity.

"CMS" means the Centers for Medicare and Medicaid Services of the U.S. Department of Health and Human Services, the federal agency that administers these programs.

"Companion Guide" means the Virginia Workers' Compensation Electronic Billing and Payment Companion Guides, based on International Association of Industrial Accident Boards and Commissions National Companion Guides, a separate document that gives detailed information for electronic data interchange (EDI) medical billing and payment for the workers' compensation industry using national standards and Virginia specific procedures.

"Complete electronic medical bill" means a medical bill that meets all of the criteria enumerated in 16VAC30-16-50 C.

"Electronic" means communication between computerized data exchange systems that complies with the standards enumerated in this chapter.

"Health care provider" means a person or entity, appropriately certified or licensed, as required, who provides medical services or products to an injured worker in accordance with § 65.2-603 of the Code of Virginia.

"Health care provider agent" means a person or entity that contracts with a health care provider establishing an agency relationship to process bills for services provided by the health care provider under the terms and conditions of a contract between the agent and health care provider. Such contracts may permit the agent to submit bills, request reconsideration, receive reimbursement, and seek medical dispute resolution for the health care provider services billed in accordance with §§ 65.2-605 and 65.2-605.1 of the Code of Virginia.

"Payer" means the insurer or authorized self-insured employer legally responsible for paying the workers' compensation medical bills.

"Payer agent" means any person or entity that performs medical bill related processes for the payer responsible for the bill. These processes include reporting to government agencies; electronic transmission, forwarding, or receipt of documents; review of reports; and adjudication of bills and their final payment.

"Supporting documentation" means those documents necessary for the payer to process a bill and includes any written authorization received from the third party administrator or any other records as required by the Virginia Workers' Compensation Commission.

"Technical Report Type 3 (TR3) Implementation Guide" means an ASC X12 published document for national electronic standard formats that specifies data requirements and data transaction sets, as referenced in 16VAC30-16-30.

16VAC30-16-30. Formats for electronic medical bill processing.

A. For electronic transactions, the following electronic medical bill processing standards shall be used:

1. Billing.

a. Professional billing: The ASC X12 Standards for Electronic Data Interchange Technical Report Type 3 and Errata, Health Care Claim: Professional (837), June 2010, ASC X12, 005010X222A1.

b. Institutional or hospital billing: The ASC X12 Standards for Electronic Data Interchange Technical Report Type 3 and Errata, Health Care Claim: Institutional (837), June 2010, ASC X12, 005010X223A2.

c. Dental billing: The ASC X12 Standards for Electronic Data Interchange Technical Report Type 3 and Errata to Health Care Claim: Dental (837), June 2010, ASC X12, 005010X224A2.

d. Retail pharmacy billing: The Telecommunication Standard Implementation Guide, Version D, Release 0 (Version D.0), August 2007, National Council for Prescription Drug Programs (NCPDP) and the Batch Standard Batch Implementation Guide, Version 1, Release 2 (Version 1.2), January 2006, National Council for Prescription Drug Programs.

2. Acknowledgment.

a. Electronic responses to the ASC X12N 837 transactions.

(1) The ASC X12 Standards for Electronic Data Interchange TA1 Interchange Acknowledgment contained in the standards adopted under subdivision A 1 of this section;

(2) The ASC X12 Standards for Electronic Data Interchange Technical Report Type 3, Implementation Acknowledgment for Health Care Insurance (999), June 2007, ASC X12N/005010X231; and

(3) The ASC X12 Standards for Electronic Data Interchange Technical Report Type 3, Health Care Claim Acknowledgment (277CA), January 2007, ASC X12N/005010X214.

b. Electronic responses to NCPDP transactions. The response contained in the standards adopted under subdivision A 1 d of this section.

3. Electronic remittance advice: The ASC X12 Standards for Electronic Data Interchange Technical Report Type 3 Errata to Health Care Claim Payment/Advice (835), June 2010, ASC X12, 005010X221A1.

4. ASC X12 ancillary formats.

a. The ASC X12N/005010X213 Request for Additional Information (277) is used to request additional attachments that were not originally submitted with the electronic medical bill.

b. Health Claim Status Request and Response.

The use of the formats in this subdivision 4 is voluntary, and Section 2.2.2 of the Companion Guide presents an explanation of how to use them in workers' compensation.

5. Documentation submitted with an electronic medical bill in accordance with 16VAC30-16-50 E (relating to medical documentation): ASC X12N Additional Information to Support a Health Claim or Encounter (275), February 2008, ASC X12, 005010X210.

B. Payers and health care providers may exchange electronic data in a nonprescribed format by mutual agreement. All data elements required in the Virginia-prescribed formats shall be present in any mutually agreed upon format.

C. The implementation specifications for the ASC X12N and the ASC X12 Standards for Electronic Data Interchange may be obtained from the ASC X12, 7600 Leesburg Pike, Suite 430, Falls Church, VA 22043; telephone (703) 970–4480; and FAX (703) 970–4488. They are also available online at http://store.x12.org/. A fee is charged for all implementation specifications.

D. The implementation specifications for the retail pharmacy standards may be obtained from the National Council for Prescription Drug Programs, 9240 East Raintree Drive, Scottsdale, AZ 85260; telephone (480) 477–1000; and FAX (480) 767–1042. They are also available online at http://www.ncpdp.org. A fee is charged for all implementation specifications.

E. Nothing in this section will prohibit payers and health care providers from using a direct data entry methodology for complying with the requirements of this section, provided the methodology complies with the data content requirements of the formats enumerated in subsection A of this section and this chapter.

F. The most recent standard for the formats in subsection A of this section shall be used, commencing on the effective date of the applicable standard as published in the Code of Federal Regulations.

16VAC30-16-40. Billing code sets.

Billing codes and modifier systems identified in this section are valid codes for the specified workers' compensation transactions, in addition to any code sets defined by the standards in 16VAC30-16-30.

1. "CDT-4 Codes" are codes and nomenclature prescribed by the American Dental Association.

2. "CPT-4 Codes" are the procedural terminology and codes contained in the "Current Procedural Terminology, Fourth Edition," as published by the American Medical Association.

3. "Diagnosis Related Group" or "DRG" is the inpatient classification scheme used by CMS for hospital inpatient reimbursement. The DRG system classifies patients based on principal diagnosis, surgical procedure, age, presence of comorbidities and complications, and other pertinent data.

4. "Healthcare Common Procedure Coding System" or "HCPCS" is a coding system that describes products, supplies, procedures, and health professional services and that includes the American Medical Association's Physician "Current Procedural Terminology, Fourth Edition," CPT-4 codes, alphanumeric codes, and related modifiers.

5. "ICD-10-CM/PCS Codes" are diagnosis and procedure codes in the International Classification of Diseases, Tenth Edition, Clinical Modification/Procedure Coding System maintained and published by the U.S. Department of Health and Human Services.

6. "NDC" are National Drug Codes of the U.S. Food and Drug Administration.

7. "Revenue Codes" is the four-digit coding system developed and maintained by the National Uniform Billing Committee for billing inpatient and outpatient hospital services, home health services, and hospice services.

8. "National Uniform Billing Committee Codes" are a code structure and instructions established for use by the National Uniform Billing Committee, such as occurrence codes, condition codes, or prospective payment indicator codes. As of (insert effective date of final regulation), these are known as UB04 codes.

16VAC30-16-50. Electronic medical billing, reimbursement, and documentation.

A. Applicability.

1. This section outlines the exclusive process for the initial exchange of electronic medical bill and related payment processing data for professional, institutional or hospital, pharmacy, and dental services.

2. Payers or their agents shall:

a. Accept electronic medical bills submitted in accordance with the adopted standards;

b. Transmit acknowledgments and remittance advice in compliance with the adopted standards in response to electronically submitted medical bills; and

c. Support methods to receive electronic documentation required for the adjudication of a bill, as described in 16VAC30-16-80.

3. Unless exempted from this process in accordance with subsection B of this section, a health care provider shall:

a. Implement a software system capable of exchanging medical bill data in accordance with the adopted standards or contract with a clearinghouse to exchange its medical bill data;

b. Submit medical bills as provided in 16VAC30-16-30 A 1 to any payers that have established connectivity to the health care provider's system or clearinghouse;

c. Submit required documentation in accordance with subsection E of this section; and

d. Receive and process any acceptance or rejection acknowledgment from the payer.

4. Payers shall be able to exchange electronic data by December 31, 2018.

5. Health care providers or their agents shall be able to exchange electronic data by December 31, 2018, unless exempted from the process in accordance with subsection B of this section.

B. Exemptions. A health care provider is exempt from the requirement to submit medical bills electronically to a payer if:

1. The health care provider employs 10 or fewer full-time employees; and

2. Treatment or services provided to injured workers to be billed under workers' compensation constitutes less than 10% of the health care provider's practice.

C. Complete electronic medical bill. To be considered a complete electronic medical bill, the bill or supporting transmissions shall:

1. Be submitted in the correct billing format;

2. Be transmitted in compliance with the format requirements described in 16VAC30-16-30;

3. Include in legible text all supporting documentation for the bill, including medical reports and records, evaluation reports, narrative reports, assessment reports, progress reports, progress notes, clinical notes, hospital records, and diagnostic test results that are expressly required by law or can reasonably be expected by the payer or its agent under the laws of Virginia;

4. Identify the following:

a. Injured employee;

b. Employer;

c. Insurance carrier, third-party administrator, managed care organization, or payer agent;

d. Health care provider;

e. Medical service or product; and

f. Any other requirements as presented in the Companion Guide; and

5. Use current and valid codes and values as defined in the applicable formats referenced in this chapter and the Companion Guide.

D. Acknowledgment.

1. An Interchange Acknowledgment (ASC X12 TA1) notifies the sender of the receipt of, and certain structural defects associated with, an incoming transaction.

2. An Implementation Acknowledgment (ASC X12 999) transaction is an electronic notification to the sender of the file that it has been received and has been:

a. Accepted as a complete and structurally correct file; or

b. Rejected with a valid rejection error code.

3. A Health Care Claim Acknowledgment (ASC X12 277CA) is an electronic acknowledgment to the sender of an electronic transaction that the transaction has been received and has been:

a. Accepted as a complete, correct submission; or

b. Rejected with a valid rejection error code.

4. A payer shall acknowledge receipt of an electronic medical bill by returning an Implementation Acknowledgment (ASC X12 999) within one business day of receipt of the electronic submission.

a. Notification of a rejected bill is transmitted using the appropriate acknowledgment when an electronic medical bill does not meet the definition of a complete electronic medical bill as described in subsection C of this section or does not meet the edits defined in the applicable implementation guide.

b. A health care provider or its agent shall not submit a duplicate electronic medical bill earlier than 60 calendar days from the date originally submitted if a payer has acknowledged acceptance of the original complete electronic medical bill. A health care provider or its agent may submit a corrected medical bill electronically to the payer after receiving notification of a rejection. The corrected medical bill is submitted as a new, original bill.

5. A payer shall acknowledge receipt of an electronic medical bill by returning a Health Care Claim Acknowledgment (ASC X12 277CA) transaction (detail acknowledgment) within two business days of receipt of the electronic submission.

a. Notification of a rejected bill is transmitted in an ASC X12N 277CA response or acknowledgment when an electronic medical bill does not meet the definition of a complete electronic medical bill or does not meet the edits defined in the applicable implementation guide.

b. A health care provider or its agent shall not submit a duplicate electronic medical bill earlier than 60 calendar days from the date originally submitted if a payer has acknowledged acceptance of the original complete electronic medical bill. A health care provider or its agent may submit a corrected medical bill electronically to the payer after receiving notification of a rejection. The corrected medical bill is submitted as a new, original bill.

6. Acceptance of a complete medical bill is not an admission of liability by the payer. A payer may subsequently reject an accepted electronic medical bill if the employer or other responsible party named on the medical bill is not legally liable for its payment.

a. The rejection is transmitted by means of a Health Care Claim Payment/Advice ASC X12 835 transaction.

b. The subsequent rejection of a previously accepted electronic medical bill shall occur no later than 45 calendar days from the date of receipt of the complete electronic medical bill.

c. The transaction to reject the previously accepted complete medical bill shall clearly indicate that the reason for rejection is that the payer is not legally liable for its payment.

7. Acceptance of an incomplete medical bill does not satisfy the written notice of injury requirement from an employee or payer as required by §§ 65.2-600 and 65.2-900 of the Code of Virginia.

8. Acceptance of a complete or incomplete medical bill by a payer does begin the time period by which a payer shall accept or deny liability for any alleged claim related to such medical treatment pursuant to § 65.2-605.1 of the Code of Virginia.

9. Transmission of an Implementation Acknowledgment under subdivision D 2 of this section and acceptance of a complete, structurally correct file serves as proof of the received date for an electronic medical bill in subsection C of this section.

E. Electronic documentation.

1. Electronic documentation, including medical reports and records submitted electronically that support an electronic medical bill, may be required by the payer before payment may be remitted to the health care provider in accordance with this chapter.

2. Complete electronic documentation shall be submitted by secure fax, secure encrypted electronic mail, or in a secure electronic format as described in 16VAC30-16-30.

3. The electronic transmittal, by secure fax, secure encrypted electronic mail, or any other secure electronic format, shall prominently contain the following details on its cover sheet or first page of the transmittal:

a. The name of the injured employee;

b. Identification of the worker's employer, the employer's insurance carrier, or the third-party administrator or its agent handling the workers' compensation claim;

c. Identification of the health care provider billing for services to the injured worker, and where applicable, its agent;

d. Dates of service;

e. The workers' compensation claim number assigned by the payer if established by the payer; and

f. The unique attachment indicator number.

F. Electronic remittance advice and electronic funds transfer.

1. An electronic remittance advice (ERA) is an explanation of benefits (EOB) or explanation of review (EOR), submitted electronically, regarding payment or denial of a medical bill, recoupment request, or receipt of a refund.

2. The ERA shall contain the appropriate Claim Adjustment Group Codes, Claim Adjustment Reason Codes, and associated Remittance Advice Remark Codes as specified in the Code Value Usage in Health Care Claim Payments and Subsequent Claims Technical Report Type 2 (TR2) Workers' Compensation Code Usage Section and for pharmacy charges, the National Council for Prescription Drugs Program (NCPDP) Reject/Payment Codes, denoting the reason for payment, adjustment, or denial. Instructions for the use of the ERA and code sets are found in section 7.5 of the Companion Guide.

3. The ERA shall be sent before five business days of:

a. The expected date of receipt by the health care provider of payment from the payer, or

b. The date the bill was rejected by the payer.

4. All payments for services are required to be paid via electronic funds transfer unless an alternate electronic method is agreed upon by the payer and health care provider.

G. Requirements for health care providers exempted from electronic billing. Health care providers exempted from electronic medical billing pursuant to subsection B of this section shall submit paper medical bills for payment in the following formats as applicable:

1. On the current standard forms used by CMS, which are available online at https://www.cms.gov/Medicare/CMS-Forms/CMS-Forms/index.html.

2. On the current NCPDP Workers' Compensation/Property and Casualty Universal Claim Form (WC/PC UCF), which are available online at http://www.ncpdp.org/Products/Universal-Claim-Forms.

3. On the current American Dental Association Claim Form, which is available online at https://www.ada.org/en/publications/cdt/ada-dental-claim-form.

All information submitted on required paper billing forms under this subsection shall be legible and accurately completed.

H. Resubmissions. A health care provider or its agent shall not submit a duplicate paper medical bill earlier than 30 business days from the date originally submitted unless the payer has rejected the medical bill as incomplete in accordance with 16VAC30-16-60. A health care provider or its agent may submit a corrected paper medical bill to the payer after receiving notification of the rejection of an incomplete medical bill. The corrected medical bill is submitted as a new, original bill.

I. Connectivity. Unless the payer or its agent is exempted from the electronic medical billing process in accordance with subsection B of this section, it should attempt to establish connectivity through a trading partner agreement with any clearinghouse that requests the exchange of data in accordance with 16VAC30-16-30.

J. Fees. No party to the electronic transactions shall charge excessive fees of any other party in the transaction. A payer or clearinghouse that requests another payer or clearinghouse to receive, process, or transmit a standard transaction shall not charge fees or costs in excess of the fees or costs for normal telecommunications that the requesting entity incurs when it directly transmits or receives a standard transaction.

K. A health care provider agent may charge reasonable fees related to data translation, data mapping, and similar data functions when the health care provider is not capable of submitting a standard transaction. In addition, a health care provider agent may charge a reasonable fee related to:

1. Transaction management of standard transactions, such as editing, validation, transaction tracking, management reports, portal services, and connectivity; and

2. Other value added services, such as electronic file transfers related to medical documentation.

L. A payer or its agent shall not reject a standard electronic transaction on the basis that it contains data elements not needed or used by the payer or its agent or that the electronic transaction includes data elements that exceed those required for a complete bill as enumerated in subsection C of this section.

M. A health care provider that has not implemented a software system capable of sending standard transactions is required to use a secure online direct data entry system offered by a payer if the payer does not charge a transaction fee. A health care provider using an online direct data entry system offered by a payer or other entity shall use the appropriate data content and data condition requirements of the standard transactions.

16VAC30-16-60. Employer, insurance carrier, managed care organization, or agent's receipt of medical bills from health care providers.

A. Upon receipt of medical bills submitted in accordance with 16VAC30-16-30, 16VAC30-16-40, and 16VAC30-16-50, a payer shall evaluate each bill's conformance with the criteria of a complete electronic medical bill.

1. A payer shall not reject medical bills that are complete, unless the bill is a duplicate bill.

2. Within 21 calendar days of receipt of an incomplete medical bill, a payer or its agent shall either:

a. Complete the bill by adding missing health care provider identification or demographic information already known to the payer; or

b. Reject the incomplete bill, in accordance with this subsection.

B. The received date of an electronic medical bill is the date all of the contents of a complete electronic medical bill are successfully received by the payer.

C. The payer may contact the health care provider to obtain the information necessary to make the bill complete.

1. Any request by the payer or its agent for additional documentation to pay a medical bill shall:

a. Be made by telephone or electronic transmission unless the information cannot be sent by those media, in which case the sender shall send the information by mail or personal delivery;

b. Be specific to the bill or the bill's related episode of care;

c. Describe with specificity the clinical and other information to be included in the response;

d. Be relevant and necessary for the resolution of the bill;

e. Be for information that is contained in or is in the process of being incorporated into the injured employee's medical or billing record maintained by the health care provider; and

f. Indicate the specific reason for which the insurance carrier is requesting the information.

2. If the payer or its agent obtains the missing information and completes the bill to the point that it can be adjudicated for payment, the payer shall document the name and telephone number of the person who supplied the information.

3. Health care providers and payers, or their agents, shall maintain documentation of any pertinent internal or external communications that are necessary to make the medical bill complete.

D. A payer shall not reject or deny a medical bill except as provided in subsection A of this section. When rejecting or denying an electronic medical bill, the payer shall clearly identify the reasons for the bill's rejection or denial by utilizing the appropriate codes in the standard transactions found in 16VAC30-16-50 D 3 b.

E. The rejection of an incomplete medical bill in accordance with this section fulfills the obligation of the payer to provide to the health care provider or its agent information related to the incompleteness of the bill.

F. Payers shall timely reject incomplete bills or request additional information needed to reasonably determine the amount payable.

1. For bills submitted electronically, the rejection of the entire bill or the rejection of specific service lines included in the initial bill shall be sent to the submitter within two business days of receipt.

2. If bills are submitted in a batch transmission, only the specific bills failing edits shall be rejected.

3. If there is a technical defect within the transmission itself that prevents the bills from being accessed or processed, the transmission will be rejected with an Interchange Acknowledgment (ASC X12 TA1) transaction or an Implementation Acknowledgment (ASC X12 999) transaction, as appropriate.

G. If a payer has reason to challenge the coverage or amount of a specific line item on a bill but has no reasonable basis for objections to the remainder of the bill, the uncontested portion shall be paid timely, as described in subsection H of this section.

H. Payment of all uncontested portions of a complete medical bill shall be made within 60 calendar days of receipt of the original bill or receipt of additional information requested by the payer allowed under the law. Amounts paid after this 60-calendar-day review period will accrue interest at the judgment rate of interest as provided in § 6.2-302 of the Code of Virginia. The interest payment shall be made at the same time.

I. A payer shall not reject or deny a medical bill except as provided in subsection A of this section. When rejecting or denying a medical bill, the payer shall also communicate to the health care provider the reasons for the medical bill's rejection or denial.

16VAC30-16-70. Communication between health care providers and payers.

A. Any communication between the health care provider and the payer related to medical bill processing shall be of sufficient specific detail to allow the responder to easily identify the information required to resolve the issue or question related to the medical bill. Generic statements that simply state a conclusion such as "payer improperly reduced the bill" or "health care provider did not document" or other similar phrases with no further description of the factual basis for the sender's position do not satisfy the requirements of this section.

B. The payer's utilization of the Claim Adjustment Group Codes, Claim Adjustment Reason Codes, or the Remittance Advice Remark Codes, or as appropriate, the National Council for Prescription Drugs Program Reject/Payment Codes, when communicating with the health care provider or its agent or assignee, through the use of the Health Care Claim Payment/Advice ASC X12 835 transaction, provides a standard mechanism to communicate issues associated with the medical bill.

C. Communication between the health care provider and payer related to medical bill processing shall be made by telephone or electronic transmission unless the information cannot be sent by those media, in which case the sender shall send the information by mail or personal delivery.

16VAC30-16-80. Medical documentation necessary for billing adjudication.

A. Medical documentation includes all medical reports and records permitted or required in accordance with Rule 4.2 of the Rules of the Virginia Workers' Compensation Commission, subdivision 2 of 16VAC30-50-50.

B. Any request by the payer for additional documentation to process a medical bill shall conform to the requirements of 16VAC30-16-60 C.

C. It is the obligation of an insurer or employer to furnish its agents with any documentation necessary for the resolution of a medical bill.

D. Health care providers, health care facilities, third-party biller, third-party assignees, and claims administrators and their agents shall comply with all applicable federal and jurisdictional rules related to privacy, confidentiality, and security.

DOCUMENTS INCORPORATED BY REFERENCE (16VAC30-16)

Electronic Billing and Payment Companion Guide, Virginia Workers' Compensation Commission, Release 1.0, 12/2018