Vague Definitions of Health Plan and Payer Create Challenges

Common misuse of the terms health plan and payer is making it difficult for the payer community to comply with the Health Plan Identifier (HPID) final rule, according to the Workgroup for Electronic Data Interchange (WEDI). While the healthcare industry uses the terms interchangeably, under HPID definitions, not all payers are health plans and vice versa.

A health plan indicates an individual or group plan that provides or pays for medical care, while WEDI defines a payer as the intended entity responsible for final processing of the claim, inquiry or enrollment or premium payment. An organization currently identified as a payer will continue to do so, but an organization currently identified as a health plan and continues to do so after Nov. 7, 2016, must use an HPID.

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Source: Fierce Health Payer