In 2014, all payers will be federally mandated to support electronic funds transfer (EFT) and electronic remittance advice (ERA) in accordance with the requirements specified in the CAQH CORE Operating Rules. Providers may be wondering how this mandate will affect payer payments and what you must do to be compliant.
Under the mandate, providers have no obligation to accept ERA/EFT from payers. However, the mandate enables providers to improve efficiency and reduce administrative costs. Read on to learn more about how the mandate impacts providers.
The mandate requires that payers include the EFT trace number with the remittance to allow easy re-association with the ERA file. Therefore, providers can reconcile payments and remittances automatically, which reduces hours of manual administrative work and reduces the risk of errors.
Stop Waiting for Mail
When your organization accepts ERA/EFT from payers, you will no longer have to wait for paper checks in the mail to get paid. Electronic payments arrive much faster than paper checks, allowing you to identify remaining patient responsibility and bill patients sooner.
Reduce Your Reliance on the Lockbox
Many providers depend on lockboxes at their bank to receive and deposit mailed paper checks, which are costly and add more manual work to processing paper check payments. With ERA/EFT, you bypass the lockbox to streamline payment processing and reduce the risk of fraud.
Streamline Workflow and Reporting
By receiving fully reconciled remittances electronically, providers can easily post and report on all remittances to save administrative time and costs.
Opportunities to Apply Best Practices
The upcoming ERA/EFT mandate helps providers to reduce their administrative costs. However, the rule specifies that providers need to “apply best practices to transmitting and receiving [ERA/EFT] transactions” in order to achieve administrative efficiency. Here are a few tips:
- Ensure staff members can access detailed, customizable reports for all transactions so they can easily view and update all information in real-time
- Leverage a private cloud that has True Availability to ensure that all data is safe (click here for a list of questions to ask vendors about their availability)
- Manage all transactions through a private cloud that is not only compliant but also independently certified and audited against the Payment Card Industry Data Security Standards (PCI-DSS) and HIPAA (check MasterCard, Visa and EHNAC for a list of independently certified solutions/vendors)
- Use a CAQH CORE-certified clearinghouse to ensure transactions are compliant with new and upcoming regulations (click here for a list)
- Connect to a network to receive ERA/EFT from multiple payers to simplify the registration process
Although payers are now mandated to support ERA/EFT, providers are not required to accept them. However, accepting ERA/EFT from payers, in place of paper checks and remittances, offers opportunities to reduce time and costs to collect and process payments.