Michigan Implements Standardized Medicaid Billing

Michigan Department of Community Health Director, James K. Haveman, Jr., today announced that after extensive planning and preparation, the Medicaid program is converting to a simplified, nationally standard billing process to streamline how physicians and other health professionals bill the Medicaid program. The more efficient system encourages electronic processing and goes into effect today.

"Today we are proud to implement this major conversion after revamping our claims processing system to make it easier for health care providers to get paid," said Haveman. "This new system is something physicians, hospitals, health care professionals and members of the Michigan legislature have urged us to do. At the direction of Governor Engler, the Department has undertaken this ambitious two-year project to improve the payment processing system."

The Michigan Medicaid program provides health insurance coverage to approximately 1.1 million Michigan citizens. Physicians, hospitals, and other providers bill the Medicaid program over 36 million claims a year. Approximately 700,000 Medicaid beneficiaries receive their health care through a health plan, so doctors and health care providers are billing these health plans as well.

Providers had complained that the lack of billing standardization between insurance payers was confusing, costly and resulted in many claims being needlessly rejected because they were not properly completed.

Medicaid set out to remedy the problem by adopting national standard forms and coding instructions to make it easier for providers. Today's implementation will affect most health professionals as they begin using the national standard paper and electronic claim formats when billing the Michigan Medicaid program or any Medicaid health plans.

During the last year, the Department has been working with providers to help make the transition as smooth as possible. The Department has issued new billing instructions and numerous advisories reminding health professionals of the change. In April, the Department launched a new state-of-the art Internet training program for insurance billers through the Governor's e-Michigan initiative. In the month of July alone, more than 800 billers participated in this training that can be done from the office or home at their own pace and convenience.

"We sponsored this training to ensure that those who conduct the billing services for health care providers who participate in the Medicaid program would be ready for uniform billing," said Haveman. Developed and hosted by Michigan Virtual University, the course is available at http://healthcare.mivu.org.

Medicaid Uniform Billing is another step toward compliance with the Health Insurance Portability and Accountability Act. It simplifies Medicaid billing, adopts health care industry claim formats and standard code sets and encourages electronic processing. The August 1 implementation is for physicians, nurse anesthetists, nurse midwives, clinics, certified nurse practitioners, vision services, clinical laboratory services and ambulance services that file claims to Medicaid fee-for-service, Medicaid health plans and Children's Special Health Care Services.

Providers are also encouraged to adopt the faster system of electronic billing, which results in fewer errors and more timely and prompt payments.

"I would like to thank the Michigan State Medical Society and the Michigan Osteopathic Association for their efforts to inform their members on these improved changes," said Haveman. "This program is moving forward, largely at the urging of their members and Michigan will be a leader with this effective system for Medicaid billing."

Since May, the Department has worked with providers and billing agents to test the system to ensure they would be able to successfully work with the new system. Blue Cross and Blue Shield of Michigan has been an important partner in this effort as they serve as a billing clearinghouse for many health care providers and have been working closely with the Department to ensure all Medicaid claims they process can use the new system.

"We have worked very hard to make this a smooth transition for the more than 32,000 health professionals making the conversion with us today," said Haveman. "Health care providers having difficulty with the new system, should call our provider inquiry line toll-free at 1-800-292-2550 for assistance or access the MDCH website at www.mdch.state.mi.us ."