Berkshire Hathaway Homestate Companies (BHHC) is breaking the law. We encourage the California Division of Workers’ Compensation (DWC) to assert its role in upholding workers’ comp law and to impose appropriate consequences on this claims administrator for its blatant disregard of e-billing requirements.

Over the course of 2021 and the first quarter of 2022, BHHC returned 4,353 untimely, invalid electronic ‘277’ acknowledgments indicating the provider’s e-bill was rejected for processing.  

Below is the message and formal Audit Complaints daisyBill submitted to the DWC on our provider clients’ behalf, documenting and reporting the staggering scope of BHHC’s violations.

Claims administrators cannot be allowed to wield the power of a phantom regulatory authority, free to ignore or adhere to laws as they please. California legislators and the DWC should penalize BHHC for presuming to pick and choose which legal requirements suit its own purposes.

As non-compliant claims administrators too often demonstrate, regulation without consequences is merely a thin facade of the rule of law.

To: XXXXXXX@dir.ca.gov

Subject: Berkshire Hathaway Homestate Companies - X12 277 Reject Untimely and Invalid

Below is an Audit Complaint reporting credible data that Berkshire Hathaway Homestate Companies (BHHC) sent providers 4,353  invalid and untimely 277 Reject Acknowledgements. This Audit Complaint data represents California workers’ comp e-bills submitted to BHHC as follows:

4,085 bills submitted 1/1/2021 - 12/31/2021

268 bills submitted 1/1/2022 - 3/31/2022

California e-billing regulations require a claims administrator to send providers that choose to e-bill a 277 Acknowledgement to alert providers whether or not the e-bill submission is complete and will be processed by the claims administrator. Regulations require the claims administrator to send the 277 Acknowledgement within 2 business days after receiving the e-bill.

While BHHC timely and compliantly sent providers a 277 Acknowledgement accepting e-bills, subsequently BHHC sent providers an untimely and invalid 277 Acknowledgement rejecting these same compliant e-bills providers sent to BHHC.

Rather than compliantly processing providers’ bills and sending providers mandated explanations of review with payment or a reason for denial, BHHC rejected and refused to process 4,353 e-bills.

Attached is credible data representing that BHHC systematically failed to compliantly process 4,353 providers’ e-bills. BHHC is noncompliant and circumventing the proper EDI processes and fails to properly reimburse providers for treating injured workers.

This Audit Complaint data represents California workers’ comp e-bills providers submitted to BHHC from January 1, 2021, through March 31, 2022.

Attached are two CSV files containing 4,353 e-bills providers submitted where BHHC incorrectly sent providers an untimely and invalid 277 Reject acknowledgment after sending the provide a timely 277 Accept acknowledgment. The attached CSV list includes the following columns:

• [Bill] Transmission Date: Column L
• 277 Ack Receipt Due Date: Column O
• 277 Ack: Receipt Date (First Accept/Reject): Column P
• 277 Ack: Type (First Accept/Reject): Column Q - First 277 ACK is Accept
• 277 Ack: Receipt Date (Current): Column S - Second untimely 277 ACK receipt
• 277 Ack: Type (Current): Column T -  Second 277 ACK is Reject
• Patient Name: Column AN
• Claim Number: Column AO

daisyBill Attempts to Contact BHHC Regarding EDI Error

On 12/13/2021 and 12/23/2021, daisyBill alerted fourteen (14) separate BHHC representatives to report the lack of compliance. In both instances, BHHC failed to respond.

News Articles published by daisyNews:

• 12/7/2021: Berkshire Hathaway Refuses 892 Second Review Appeals
• 1/12/2022: Berkshire Hathaway Ignores THOUSANDS of Second Review Appeals (& CA Law)
• 1/13/2022: Berkshire Hathaway: DWC Targeted Audit Needed ASAP

Audit Complaint Details

Bill Transmission: Original / Second Review - 277 Reject Untimely / Prior 277 Accept

California DWC Medical Billing and Payment Guide Rule 7.1 requires the claims administrator to either accept an e-bill as complete or reject the e-bill as incomplete, using the X12 277 Acknowledgement (277 ACK) EDI standard. This 277 ACK must be sent within two working days after receipt of an e-bill.

The purpose of a 277 Acknowledgment is to furnish notice to providers whether or not the bill submission is complete and will be processed by the claims administrator.

EDI Noncompliance: Claims administrator sent providers an invalid and untimely 277 Reject Acknowledgment and failed to process e-bills providers transmitted to the claims administrator.

The claims administrator rejected providers’ e-bills after initially sending the provider a valid and timely 277 Accept Acknowledgement for the same e-bill claims administrator subsequently rejected. The claims administrator is failing to use the required 277 Acknowledgements to alert the provider that either:  

• The complete e-bill submission was received and accepted (including supporting documentation), or
• If the e-bill was rejected (and will not be processed) what errors are present, and if necessary, what action the submitter should take

Per DWC Rule  7.1 (a)(3)(A)(B)(i) through (vii), claims administrator failed to properly document a valid bill rejection error message as follows:

1. Invalid form or format - indicate which form should be used.
2. Missing information - indicate specifically which information is missing by using the appropriate 277 Claim Status Category Code with the appropriate Claim Status Code.
3. Invalid data - Indicate specifically which information is invalid by using the appropriate Claim Status Category Code with the appropriate Claim Status Code
4. Missing attachments - indicate specifically which attachment(s) are missing.
5. Missing required documentation - indicate specifically what documentation is missing.
6. Injured workers’ claim of injury is denied.
7. There is no coverage by the claims administrator.

daisyBill fights the good fight on behalf of workers’ comp providers. Reach out to see how we can help your practice obtain fast, correct reimbursement for treating injured workers.

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