EFT Standardization Looks Promising

by 
April 17th, 2014

January 1, 2014 was the required date for adoption of standards for both Electronic Funds Transfer (EFT) and Electronic Remittance Advice (ERA). The Centers for Medicare & Medicaid Services (CMS) recently announced that the implementation of these new standards has resulted in benefits for both providers and CMS. Not surprisingly, the first quarter of 2014 experienced a 32% increase in EFT transactions which means that providers were paid faster than they were in the fourth quarter of 2013.

CMS stated in an April alert that they estimate that over the next four years, EFT standards will lead to a 6% to 8% annual increase in the use of EFT for health care payments. The announcement further stated the following:

"In developing the regulation for health care EFT standards, HHS calculated that there will be a 10% to 15% time savings for health care providers using EFT to receive and post payments. The American Medical Association estimates that efficiencies from use of EFT will lead to approximately $2,000 in annual savings per physician, with savings of more than $0.40 in processing costs for each paper check that is converted to an EFT. With the number of health care payments sent through EFT in the first 3 months of 2014 alone, you can see how these savings will add up.

With the promising start for health care EFT, HHS has high hopes for other Administrative Simplification initiatives like eligibility and claims status operating rules and the Health Plan Identifier.

If you use EFT, we want to make sure you are aware of your options for receiving electronic payments. As of January 1, 2014, health plans are required to comply with provider requests to use the ACH Network to conduct EFT and ERA transactions."

However, not all providers may be taking advantage of all the benefits of these updates. It is possible that your practice management software may need to be upgraded in order to take advantage of the integration of EFT and ERAs. For more information, please refer to page F-18 of the 2014 ChiroCode DeskBook.

EFT Standardization Looks Promising. (2014, April 17). Find-A-Code Articles. Retrieved from https://www.findacode.com/articles/eft-standardization-looks-promising-25591.html

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