The U.S. Department of Health and Human Services (HHS) recently released an interim final rule (IFR) with comment period that adopts "Operating Rules" for electronic funds transfer (EFT) and electronic remittance advice (ERA) transactions by physician practices, hospitals and health plans. By replacing the burdensome, paper-driven billing practices currently employed by more than 70 percent of providers with a standardized electronic system for EFT and ERA transactions, HHS estimates the IFR will save between $300 million and $3.3 billion over ten years in the following administrative areas: (1) provider enrollment in EFT and ERA; (2) implementing connectivity between trading partners; (3) reassociation of the payment information with the remittance information; and (4) posting payment adjustments and claim denials.

The third in a series of rules implementing Section 1104 of the Patient Protection and Affordable Care Act (PPACA), the IFR adopts all but one of the Phase III EFT and ERA operating rules by the Council for Affordable Quality Healthcare Committee on Operating Rules for Information Exchange (CAQH-CORE). HHS declined to adopt Requirement 4.2, titled "Health Care Claim Payment/Advice Batch Acknowledgement Requirements," of the Phase III CORE 350 Health Care Claim Payment/Advice (835) Infrastructure Rule because the Secretary has not adopted standards for acknowledgements.

HIPAA-covered entities (e.g., health plans, healthcare clearinghouses and healthcare providers that transmit health information in electronic form in connection with a transaction for which the Secretary has adopted a standard) must comply with the Operating Rules by January 1, 2014. The close of the comment period for the IFR, which became effective August 10, 2012, is October 9, 2012.

Cory Fox contributed to this article.