Frequently Asked Questions

Frequently Asked Questions (FAQs)

The following FAQs are provided for information and clarification. They will be revised and updated as needed. Additional information regarding Minnesota Statutes, section 62J.536 and related rules is available at on the Minnesota Department of Health Administrative Simplification Act website.

Last revised: 1/30/2012

Category 2 - Federal HIPAA transactions and operating rules

HIPAA stands for the Health Insurance Portability and Accountability Act. Title II of HIPAA includes a series of health care administrative simplification provisions that call for: the establishment of standards for electronic health care transactions; unique identifiers for employers, health plans, and health care providers; and privacy and security standards to protect health information.

National standards for these areas are established by the Secretary of Health and Human Services through the rulemaking process. Final HIPAA rules have been issued adopting standards and requirements for electronic transactions and code sets, a unique employer identifier, the national provider identifier, and privacy and security of health information. Civil and monetary penalties and federal criminal penalties may be imposed for the violation of HIPAA standards.

HIPAA calls for changes designed to streamline the administration of health care, eliminate proprietary formats and methods to codify and exchange information, and automate administrative processes to improve efficiencies in the health care industry and ultimately the quality of health care services provided.

Entities subject to HIPAA (known as “covered entities”) include: (1) all health plans [i.e. payers, group purchasers, carriers, third party administrators (TPA), etc.]; (2) all health care clearinghouses; and (3) health care providers that choose to conduct administrative transactions electronically.

One group of federal regulations issued by the Secretary of Health and Human Services (HHS) in response to the administrative simplification provisions of HIPAA was the HIPAA Transactions and Code Set Regulations. Transactions are a set of defined activities involving the exchange of health care information (for example, a health care claim). Code sets are standard codified representations of certain health information that are included in a transaction (for example, coding the diagnosis of a patient using the ICD-9 code set). National compliance with the HIPAA Transactions and Code Sets Regulations started October 16, 2003 for all covered entities.

The HIPAA Transactions and Code Sets Regulations establish national standards to be used in the electronic exchange of selected transactions including transaction standards for health care claims or equivalent encounter information, claim payment/advice, claim status inquiry and response, eligibility inquiry and response, coordination of benefits, referral certification and authorization inquiry and response, claim status inquiries and response, enrollment/disenrollment in a health plan, and health plan premium payment. Subsequent amendments to the HIPAA regulations as part of the Patient Protection and Affordable Care Act (PPACA) in 2010 also required adoption of standards for electronic funds transfer (EFT) and claims attachments.

Standard code set names and descriptions

Standard code set name


Code on Dental Procedures and Nomenclature (CDT)

Dental services

Current Procedural Terminology, Fourth Edition

Physician services/other health services

International Classification of Diseases, 9th Edition, Clinical Modification, Volumes 1 and 2 (ICD-9-CM)*


International Classification of Diseases, 9th Edition, Clinical Modification, Volume 3 (ICD-9-CM)*

Inpatient hospital procedures

National Drug Codes (NDC)


*Covered entities are to transition from using ICD-9 code sets to using ICD-10 code sets by October 1, 2013.

Relationship to Minnesota’s law and rules: Minnesota Statutes, section 62J.536 requires group purchasers, providers, and clearinghouses to exchange certain health care administrative transactions electronically. These transactions include health care eligibility benefit inquiries and responses, claims, payment/remittance advices, and acknowledgments. Consistent with HIPAA, group purchasers, providers, and clearinghouses are required to use the national standards and implementation guides adopted by the Secretary of Health and Human Services. As previously noted, all users to which the Minnesota rules apply are required to use the Minnesota uniform companion guides.

The HIPAA Implementation Guides—the documents used to implement the national electronic standards adopted by HIPAA for the named administrative transactions—can be found at the following locations:

If you have general questions about the HIPAA Implementation Guides, you can begin with your practice management software vendor, health care clearinghouse, or the EDI contact at your trading partner organizations.

ASC X12 Committee responses for formal interpretations of its implementation guides are available on the ASC X12 Interpretation Portal. These responses are commonly known as Requests for Interpretation, or “RFIs”.

In most cases, depending on the size of the organization and the volume of transactions being exchanged, the organization will depend on and work with their practice management software vendor or health care clearinghouse to meet the HIPAA Transactions and Code Sets Regulations and may not need to purchase the HIPAA and NCPDP implementation guides.

All health plans and health care clearinghouses are subject to comply with the HIPAA privacy and security rules. Health care providers that conduct any of the HIPAA administrative transactions electronically are also subject to comply with the HIPAA Privacy and Security Rules. HIPAA covered entities are required to apply the same privacy and security requirements they are subject to comply with in agreements with business associates. Refer to the U.S. Department of Health and Human Services website to learn how to comply with the privacy and security rules.

The Patient Protection and Affordable Care Act (PPACA), which was enacted in 2010, includes administrative simplification provisions for HIPAA-covered entities in Section 1104. Specifically, PPACA requires HHS to adopt operating rules for selected HIPAA transactions with the intent to create more uniformity in the implementation of the electronic standards.

According to HHS, operating rules augment the HIPAA transaction standards in three ways:

  • They contain additional requirements that help implement the standard for a transaction in a more consistent manner across health plans;
  • They address ambiguous or conditional requirements in the standard and clarify when to use or not use certain data elements or code values; and
  • They specify how trading partners, including providers, should communicate with each other and exchange patient information, with the goal of eliminating connectivity inconsistencies.

Pursuant to PPACA, HHS is to adopt operating rules for nine electronic transactions, three of which are already mandated in Minnesota and two of which the Minnesota AUC has developed best practices for to standardize their use. The table below shows the covered transactions and the dates by which HHS is to adopt operating rules, their effective dates, and the dates by which health plans are to certify compliance with these rules.

Operating rule adoption, effective, and compliance dates for covered transactions

Transaction operating rules




Eligibility *




Claim status

“ “

“ “

“ “

Electronic funds transfer **


“ “

“ “

Payment/advice *

“ “

“ “

“ “

Claims *




Enrollment/disenrollment in a health plan

“ “

“ “

“ “

Health plan premium payments

“ “

“ “

“ “

Claims attachments **

“ “

“ “

“ “

Referral certification/authorization

“ “

“ “

“ “

Source: Publ. L. No. 111-148.

* Minnesota Statutes Section 62J.536 mandated the use of these transactions along with single, uniform companion guides.

** The Minnesota AUC has developed and published best practices to standardize the use of electronic funds transfer and claims attachments.

The Council for Affordable Quality Healthcare (CAQH) Committee on Operating Rules for Information Exchange (CORE) authored the operating rules and they are available for free on its website. HHS adopted operating rules for the eligibility and claim status transactions on June 30, 2011 which have an effective date of January 1, 2014.

The operating rules apply to all:

  • Health care providers who provide services for a fee in Minnesota;
  • Group purchasers (insurance companies, health plans, and other payers) licensed or doing business in Minnesota; and
  • Health care clearinghouses providing services on behalf of covered providers and group purchasers.

The Minnesota Department of Health (MDH) Health Care Administrative Simplification and the Minnesota Administrative Uniformity Committee (AUC) are currently reviewing the eligibility operating rules to determine what, if any, changes should be made to the Minnesota Uniform Companion Guide for the Implementation of the Health Care Eligibility Benefit Inquiry and Response (270/271).

Updated Tuesday, 18-Aug-2020 07:10:06 CDT