What is HIPAA?

HIPAA is the acronym for the Health Insurance Portability and Accountability Act of 1996.

HIPAA's administrative simplification provisions require national standards for electronic health care transactions and national identifiers for providers, health plans, and employers. It also addresses the security and privacy of health data.

The transactions targeted for electronic data interchange include benefit plan enrollment and benefit premium extraction.

The Benefit Enrollment and Maintenance file (834) is used to transfer enrollment information from the sponsor of the insurance coverage (or benefits) to a payer of those benefits (or coverage claims). The Benefits Administration application provides a way for you to extract benefit enrollment data in a format consistent with 834 EDI transmission using Benefit Transaction Export (BN106). You can use the 834 transaction set to:

  • Provide updates (new enrollments; enrollment maintenance) to the enrollment database.

  • Create file audits to ensure the plan sponsor's and payer's systems contain the same information.

Note: You can use the standard transaction set whether or not you communicate benefit enrollment information directly to the payer or you use a third party administrator (TPA).

Benefits Administration also provides a method for extracting benefit premium data into ASC X12N 820, the file format required by the Department of Health and Human Services in compliance with HIPAA requirements.

  • You can create four kinds of reports using Premium Report (BN320): a premium report, an exception report, a summary report, and a combination of all three. Each report groups premiums by benefit plan. Employees, COBRA participants, and retirees list separately.

  • BN320 creates a single HIPAA 820 file, so you will need to run the program separately for each health plan.

  • To calculate monthly premiums, the application divides the premium or contribution from the employee's benefit record by twelve.