Health Insurance Reform: Standards for Electronic Transactions. 4. Conducting the Transactions


Proposal Summary: If a person conducts a transaction (as defined in §160.103) with a health plan as a standard transaction, the following apply:

  1. The health plan may not refuse to conduct the transaction as a standard transaction.
  2. The health plan may not delay the transaction or otherwise adversely affect, or attempt to adversely affect, the person or the transaction on the ground that the transaction is a standard transaction.

Comment: Some commenters questioned what was meant by “delay” of a standard transaction. They questioned what methods (i.e., batch, online, etc.) a health plan must provide to support receipt and submission of standard transactions. The proposed rule did not define the term “delay” nor specify the time frame within which a health plan is required to act when it receives a standard transaction.

Several commenters recommended the rule encompass all entities that might be conducting an electronic transaction with a health plan and that there be further clarification of what an unreasonable delay would be. It was also recommended that the regulation should apply to a health care provider, not a person that conducts an “electronic” transaction.

Response: Section 1175 of the Act prohibits a health plan from delaying a standard transaction, or otherwise adversely affecting, or attempting to adversely affect any person desiring to conduct a transaction referred to in § 1173 (a)(1) of the Social Security Act or the transaction on the ground that the transaction is a standard transaction. We interpret this provision to mean that there should be no degradation in the transmission of, receipt of, processing of, and response to a standard transaction solely because the transaction is a standard transaction. Thus, health plans must process standard transactions from any person, including, but not limited to, covered entities, in the same time frame in which they processed transactions prior to implementation of HIPAA. They also may not provide incentives that will discourage (i.e., adversely affect) the use of standard transactions.

In §162.923 we have included requirements for all covered entities and in §162.925 we have provided additional requirements for health plans.