Recently, The Department of Health and Human Services (“HHS”) released guidance on the application process to obtain a Health Plan Identifier (“HPID”). A HPID is an all-numeric, 10-digit identification number requirement for many HIPAA-covered health plans. HPIDs will be used in all HIPAA standard transactions, like the payment of health care claims, claim status checks, health plan eligibility confirmations and premium payments. The purpose of requiring a standard identifier is to increase the efficiency and accuracy of those transactions. Currently, health plans are identified in those transactions using various identifiers that differ in length and format. The HPID will be unique for each health plan but will be in the same format.

The HPID requirement is another product of the Affordable Care Act and is an effort to reduce administrative costs by promoting electronic transactions between medical providers and health plans. Plan sponsors that need to obtain a Health Plan Identifier (HPID) will go through the Centers for Medicare and Medicaid Services (CMS) Enterprise Portal, access the Health Insurance Oversight System (HIOS), and apply for an HPID from the Health Plan and Other Entity System (HPOES)

The new two-page document takes users through the HPID application process step-by-step. Employers will register their organization, then identify approved users and their roles in the web portal and designate an “Authorizing Official User” to act on behalf of the organization in approving/submitting applications.

HPIDs are not required for every health plan, only Controlling Health Plans (“CHP”) will need to get them. A CHP is a health plan that either controls its own business activities or is not controlled by an entity that is not a health plan and exercises sufficient control over any Sub-health Plans (“SHP”). A SHP is simply a health plan whose business activities are controlled by a CHP and obtaining a HPID for SHPs is optional. (1) Employers will need assurance by plan administrators and vendors who process transactions for their plan that the vendor has gone through a required testing process and has received the necessary certification from HHS.

The timing of employer compliance with these requirements depends on whether the plan is considered a small (not to be confused with Sub-health Plans) or large health plan. Large health plans are required to obtain an HPID by November 5, 2014. However, small health plans (with annual receipts of $5 million or less) have until November 5, 2015 to register for an HPID. All health plans must certify compliance by December 31, 2015.(2) HPIDs will be required to be used in HIPAA standard transactions beginning November 7, 2016. The HIPAA covered entity is required to use an HPID in the electronic HIPAA transactions and ensure that business associates of the entity are also using a HPID. (1)

Additional Reading:
Centers for Medicare and Medicaid Services HPID Frequently Asked Questions

Sources:
1)Have You Obtained a HPID?

2)Self-Funded Employers and the HIPAA Health Plan Identifier Number (HPID)

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