Anesthesia and the Version 5010 Standard


November 28, 2011

In just under five weeks, on January 1, 2012, physicians, hospitals, health plans and claims clearinghouses will be required to be in compliance with the ASC X12 Version 5010 HIPAA standard for the electronic transmission of healthcare claims and other administrative communications such as claims, remittance, eligibility, claims status requests and responses.

CMS Delays Enforcement

Evidence from the field and the efforts of organized medicine have persuaded the Centers for Medicare and Medicaid Services (CMS) that many providers and payers will not be ready to change from Version 4010 to Version 5010 by the January 1st deadline.  On November 17th, CMS announced that it would delay enforcement for 90 days, i.e., through March 31, 2012.  According to its statement:

[CMS] encourages all covered entities to continue working with their trading partners to become compliant with the new HIPAA standards, and to determine their readiness to accept the new standards as of January 1, 2012. While enforcement action will not be taken, [CMS] will continue to accept complaints associated with compliance with Version 5010 . . . during the 90-day period beginning January 1, 2012. If requested by [CMS], covered entities that are the subject of complaints (known as “filed-against entities”) must produce evidence of either compliance or a good faith effort to become compliant with the new HIPAA standards during the 90-day period.

Originally CMS had set April 2010 as the deadline for implementation of Version 5010, which it described in a regulation published in January 2009.  Lobbying for more time to update and test software for a smooth transition resulted in a postponement until January 2012.  With the latest CMS announcement, claims using the Version 4010 standard should continue to be paid for dates of service through March 31, 2012.

If, after January 1st, an anesthesiologist submits a 4010 claim which the health plan rejects because it is running Version 5010 and does not accept legacy claims – or if the anesthesiologist is the one running Version 5010 and the health plan is not ready for that standard – the anesthesiologist has the option of filing a complaint (via the Administrative Simplification Enforcement Tool at  Any fine that CMS decides to impose on the health plan will probably not be issued for several months.  The anesthesiologist in this situation should direct his or her efforts toward the health plan to determine how to get paid as quickly as possible.

The Medical Group Management Association (MGMA) last month urged CMS to “immediately issue a comprehensive contingency plan” that would permit health plans to continue to process non-compliant healthcare claims.  MGMA senior policy advisor Robert Tennant has said that more time yet may be necessary and that “We strongly encourage the government to monitor the industry. If things don't improve, they'll have to look seriously about augmenting this decision they made today.” (Conn J. 5010 Crisis May Loom Despite Grace Period., November 18, 2011.)

The 5010 and Claims for Anesthesia Services

Version 5010, like the 4010, defines the data elements and formats used in electronic claims.  One of the better-known data-reporting changes mandated by the 5010 is the required use of a physical street address in the billing provider address field and not a P.O. or lock box number, even though the “pay-to address” can be a P.O. box.

Anesthesia practices need to understand three specific changes in Version 5010:

  1. Surgical codes for anesthesia services are optional.  There is “significant confusion” on the part of both anesthesiologists and health plans regarding the information necessary to report anesthesia services, the ASA stated in a November 7, 2011 alert entitled “Changes for Anesthesia Claims Under 5010 Transaction Code Set.”  Version 5010 provides that the surgical code is only reported on a claim for anesthesia services when the anesthesiologist “knows the surgical code and the surgical code is necessary for claim adjudication.”  Some payers have interpreted this to mean that the surgical code is required, but the X12 standards committee has told ASA that it is not.  Payers can require the submission of surgical codes in their participation agreements, but without such contractual stipulations, they cannot properly reject a claim for lack of a surgical code.
  2. Reporting anesthesia time in minutes vs. units. While Medicare requires anesthesia time to be reported in total minutes, which it divides by 15 to determine the number of payable 15-minute units, many private payers allow anesthesiologists and nurse anesthetists to report units only.  Both methods were acceptable under Version 4010.  Version 5010, however, eliminates the option of reporting units.

    The advantage of reporting units is the ability to round up from, e.g., the last 6 minutes of anesthesia time to the next whole unit.  Thus a 96-minute case could yield either 7 or 6.4 time units.  The same case could also produce a flat 6 time units if the payer rounds down from anything less than 7 (or 8, or 10, etc.) marginal minutes.

    While Version 5010 requires time to be reported in actual minutes, anesthesia practices and payers can still agree to round up or down to a whole unit through the appropriate contractual provisions.

  3. ”Not Otherwise Specified” codes.  Many CPT codes contain “not otherwise specified (NOS)”or “not elsewhere classified (NEC)” in their descriptors.  Under Version 5010, payers may require additional information on claims for services represented by “NOS” or “NEC” codes.  According to the ASA:

    Anesthesia codes are constructed differently. Many anesthetics are reported with anesthesia codes that include “not otherwise specified” in their descriptors to cover anesthesia for a range of surgical procedures.  It is impractical for anesthesiologists to submit additional individual information each time they report an NOS anesthesia code.  ASA will work with payers to clarify how NOS is used differently in the anesthesia codes than for surgical codes.

Anesthesia Practices Should Continue Testing 5010 Transactions With Their Trading Partners

When it announced the delay in enforcement, CMS urged physicians and other stakeholders to "continue working with their trading partners to become compliant with the new HIPAA standards, and to determine their readiness to accept the new standards as of January 1, 2012."  Anesthesia and pain medicine practices that have not already assured themselves that their billing systems, their clearinghouses and their payers are ready to switch to Version 5010 should continue testing – or pushing their trading partners to test – on the assumption that there will be no further delays.

ABC has successfully tested Version 5010 transactions with all Medicare carriers and completed testing with all the private payers with whom our clients do business by the end of the year.  We hope that the transition will be smooth and uneventful for all our readers.

With best wishes,

Tony Mira
President and CEO