HHS plans to standardize health care employer ID
The U.S. Department of Health and Human Services (HHS) has announced plans to standardize the identifying numbers assigned to employers in the health care industry by using the existing identifying numbers already assigned by the Internal Revenue Service (IRS). The move, announced in June, is expected to save $1.5 billion over the first five years of implementation.
"The national standard employer identifier will help eliminate paperwork, simplify activities such as enrollment in health plans and payment of health insurance premiums, and save money for consumers," HHS Secretary Donna Shalala said in a statement announcing the move.
The proposed national standard employer ID number is the Employer Identification Number (EIN), which is issued and maintained by the IRS. Businesses that pay wages to employees already have an EIN.
All would use one number
Under the proposed rule, health care providers, health care clearinghouses, and health plans would use this number to identify the employer on electronic health transactions that require an employer identifier.
Currently, health plans, providers, and employers may use different ID numbers for an employer when they conduct business. Having multiple ID numbers for a single employer slows activities such as health plan enrollments and health plan premium payments, and it increases costs.
"Standard health identification numbers are important components of electronic health transactions. Using the existing Employer Identification Number is an efficient, logical choice because most employers already have it," says Nancy-Ann DeParle, administrator of the Health Care Financing Administration, which runs the Medicare and Medicaid programs.
The national standard employer ID number proposal, published in the June 16 Federal Register, is one of several administrative simplification efforts under way. These efforts will promote electronic transactions and the reduction of paperwork. Savings, even taking into account start-up costs, are expected to total $1.5 billion over the first five years of implementation.
In addition to the national standard employer identifier, other proposals under the law will call for national standard ID numbers for use in health care systems for health care providers and health plans.
The law also requires standards for common electronic health care transactions, code sets, and stringent new security rules to protect confidentiality of and access to health records. All health plans, health care clearinghouses, and any health care providers that conduct electronic health transactions will be required to abide by these standards.
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