HIPAA Compliant
Medical Billing Software

This article reviews the basic requirements for an application to be considered HIPAA compliant medical billing software.

HIPAA law is very complex and it is my intent to cover only items that relate to medical billing software. It is a good idea for medical billers and medical office personnel to attend seminars to stay up to date on HIPAA requirements.

The most common HIPAA requirements, that we are all familiar with, are the implementation of the NPI for health care providers and the updating of the HCFA to form CMS 1500 for professional billing.

For your program to be considered HIPAA compliant medical billing software, it must have the following features:


User Access


HIPAA compliant software must have user security capability. Each staff member that accesses patient records must have a user logon and password. The user should have access to patient data in accordance to their role in the practice.


Data Back ups


A data backup protocol must be established. Back ups must be protected and a procedure must be in place to periodically test data for recovery.


Audit trails


All data field access must be tracked and recorded. Some programs have archiving capability which improves system speed and performance.


Plan ID


This field is provided to contain the Health Plan Identifier, which will be implemented by insurance carriers. It is expected to consist of ten numbers that identify a contract between the provider and carrier to conduct or process transactions of health plans in compliance with HIPAA requirements.


Healthcare ID


This is a unique identification for the patient. The field is not currently in use but the field should be available to help the practice meet future HIPAA compliance standards.


HIPAA approved codes


This feature provides an on and off "switch" to indicate that a CPT or diagnosis code is a HIPAA approved code. This field is linked to warn the user of unapproved or obsolete codes.



HIPAA changes, as they relate to software, are taking place over several years. Some of the features haven't been implemented yet but it is important to keep your programs updated so that you will have HIPAA compliant medical billing software.

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