Fam Pract Manag. 2002 Mar;9(3):53.

HIPAA translation software


I plan to automate my private practice and submit claims electronically in-house. How does the software using the Health Insurance Portability and Accountability Act (HIPAA) standards work, and where can I purchase it?


The software that converts nonstandard claims and other transaction formats into HIPAA-standard electronic data interchange (EDI) formats is called a translator or translation software. The translation can be done at any point in the hand-off of data –in the office, at the clearinghouse, at the health plan or even at a third-party translation service. From a physician’s perspective, it’s best to do the translation in-house (i.e., before sending out claims or eligibility requests), as you are planning to do, primarily because everyone else is obligated to accept the transaction once it has been translated into HIPAA-standard format. In-house translation also gives you the greatest degree of control and saves you the expense of paying someone to do the translation.

In addition to having the translation software, you also want to ensure that your practice management software is capable of receiving HIPAA-standard formats and doing the reverse translation necessary to handle incoming information from payers, such as remittances and claims status information. Fortunately, all of the major practice management software vendors are adding translation programs to their current applications (as upgrades and newer versions) and making their applications capable of sending and receiving HIPAA-standard claims and other transactions. The newer application service provider (ASP) practice management vendors and the health data network services companies, such as WebMD, provide translation services as well.

All of this will cost your practice more money, but it is not clear how much more. Before you can choose the best and most cost-effective way to send your claims electronically in HIPAA-standard format, you need to ask software vendors the hard questions: Will the software allow me to send and receive HIPAA-standard transactions? If so, which ones will I be able to send and when? What will it cost me to upgrade or convert my practice management software so that translation software is included? Since translation software must be tested and certified with all trading partners to ensure that both parties send and receive without glitches, when (and with which trading partners) will the software be ready to test and certify?

For more information about HIPAA, go to

Creating an employee manual


I’d like to put together an employee manual that includes common policies, procedures, etc. What’s involved in this process?


There are basically four steps involved in creating an effective employee manual:

1. Become familiar with state and federal employment laws. The number of employees in your practice (including employed physicians) can affect the required content of your manual. For example, if you have 50 or more employees, your manual must include information about the Family and Medical Leave Act. If you have more than 20 employees, you must include information about COBRA (the Consolidated Omnibus Budget Reconciliation Act of 1985). Other laws vary by state, so ask your state Department of Labor for its basic packet of employer documents, posters and books, which are usually free.

2. Decide who will develop the manual. If you choose to develop your own manual, there are a number of resources available to assist you, such as the Practice Management Information Corporation’s simple medical office policy manual or the Medical Group Management Association’s Group Practice Personnel Policy manual. Your state medical association, Chamber of Commerce or Better Business Bureau may also offer a standard employee manual or a do-it-yourself template, perhaps on CD-ROM. These resources can range from $250 to $600.

If you have a large practice or prefer a more customized manual, you may wish to hire a consultant knowledgeable in medical office job descriptions, pay and benefits to help you. The cost will likely range from $1,500 to $6,000.

3. Have your completed manual reviewed by an attorney. No matter which method you choose for creating your manual, you should have the final draft reviewed by a labor-law specialist in your state to make sure there are no critical mistakes.

4. Introduce your manual to the staff. Once the manual is complete, it should be introduced and thoroughly explained to the staff in a group meeting. Each staff member should receive a copy of the manual and provide a signed receipt that they have read and understand the manual. Be sure to comply with the manual yourself and have it updated regularly.

* Denotes member of FP Assist, the AAFP’s online clearinghouse for consultants and attorneys.


Copyright © 2002 by the American Academy of Family Physicians.
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