Health care providers in Minnesota must begin using electronic billing for health care claims on July
15 as part of a first-in-the-nation law that state officials say will help save millions of dollars in health care administrative costs each year.

The law covers about 60,000 providers, including doctors, hospitals, dentists, chiropractors,
pharmacies and others. Each year more than 55 million medical bills, known as health care claims, from these health care providers are processed in Minnesota, resulting in significant transactions costs – and opportunities for savings.

The e-billing requirements are part of broader statewide health reforms that strive to improve the
health of all Minnesotans, the individual patient experience and the affordability of health care.

“By reducing the administrative costs of health care, we can better spend those resources on patient care and health improvement,” said Minnesota Commissioner of Health Dr. Sanne Magnan.

The Minnesota Department of Health estimates that when fully implemented, Minnesota’s law
requiring the standard, electronic exchange of routine health care business transactions will save the state’s health care system more than $60 million per year.

Many bills are currently still submitted on paper, which costs nearly twice as much as electronic
billings. Tracking down, checking, clarifying and resending routine business information further add to needless administrative expenses and delays.

The requirements that take effect on July 15 call for providers to bill for their services electronically, using a single, standard data content and format, and for payers to accept the electronic bills. The new requirements do not change the nature of transactions between consumers and their providers or health plans.

The regulations apply to all health care providers who provide services for a fee in Minnesota and
who are also eligible for reimbursement under the state’s Medical Assistance program.

Payers covered by the law include such “group purchasers” as insurance carriers and third-party
administrators licensed or doing business in Minnesota. The insurance carriers covered by the law
include workers’ compensation, auto and property-casualty carriers. The law also applies to accident and health insurers, HMOs, the Minnesota Department of Human Services, which administers the state’s Medical Assistance and MinnesotaCare programs, and other payers.

Minnesota has already implemented a similar requirement for the standard, electronic exchange of
queries between providers and payers to confirm patient health coverage and benefits levels, which took effect Jan. 15. Beginning Dec. 15, providers and payers will also be required to electronically exchange explanations of any adjustments to or denials of billings, known as payment remittance advices.

For further information about Minnesota’s statewide health care e-billing initiative please go to
www.health.state.mn.us/asa/ or contact the Minnesota Health Information Clearinghouse at 1-800-657-3793, or health.clearinghouse@state.mn.us.