Jersey leads way on HIPAA
- By Dibya Sarkar
- Nov 18, 2001
HIPAA home page
While many health care providers and payers fret over meeting federal deadlines
regarding electronic sharing of health information, New Jersey seems well
ahead of the pack.
New Jersey officials began assessing back in 1993 how the state could
improve its health care system and save money by using electronic data interchange
technology and national standards for transmitting health care data. As
a result of a study by the Thomas Edison State College and New Jersey Institute
of Technology, they found that the state could save $760 million annually.
By doing such an analysis and having the state legislature pass laws
to simplify health care administration, New Jersey is ahead of other states
in helping providers and payers implement the rules set forth by the Health
Insurance Portability and Accountability Act of 1996.
The New Jersey study was presented during a one-day HIPAA conference
Nov. 16 in Washington, D.C., sponsored by Federal Sources Inc. and Potomac
According to New Jersey's Healthcare Information Networks and Technologies
study, electronic claims are cheaper, more accurate and faster to process
than paper-based claims.
The study estimated that national health care expenditures for the 4.6
billion claims processed annually were about $1 trillion, of which $183
billion represented administrative costs. In New Jersey, the cost of processing
150 million claims was $30 billion annually, of which $5 billion went to
As a result of the study, state laws mandated:
* Standardized health care enrollment and claims forms.
* Standardized electronic transmission of health care data using HIPAA
* Continued monitoring of electronic data interchange technology and
* Prompt submission of claims by providers and prompt payment of claims
Mark Gordon, director of special studies at Thomas Edison State College,
said he expected New Jersey to comply with the federal Transactions and
Code Sets rule by next October. By Oct. 16, 2002, providers and payers must
comply with the rule, which sets forth national standards for codes that
identify patients and describe diseases, injuries and other health problems.