Though some healthcare stakeholders wish it wouldn’t
As physicians, hospitals, skilled nursing facilities and others faced the Oct. 1 deadline to implement ICD-10 diagnosis codes, many questions remained:
- How difficult will the transition be?
- How tough will payers be in expecting correct coding?
- As a provider, am I going to miss claims? What will that do to cash flow?
- As a distributor, am I facing extended terms and accounts receivable issues?
- Can someone remind me why we’re doing this anyway?
After years of delay, the deadline for providers to implement ICD-10 codes finally arrived on Oct. 1. By that date, all providers affected by the Health Insurance Portability Accountability Act (HIPAA) were to have begun providing claims with ICD-10 diagnosis codes. (The change to ICD-10 will not affect CPT coding for outpatient procedures.)
“The International Classification of Diseases, or ICD, is used to standardize codes for medical conditions, diagnoses, and institutional procedures and has not been updated in this country for more than 35 years,” wrote Andrew M. Slavitt, acting administrator for the Centers for Medicare & Medicaid Services, in a letter to Medicare providers in July.
“The current code set, ICD-9, contains outdated, obsolete terms that are inconsistent with current medical practice,” he wrote. “As we work to modernize our nation’s health care infrastructure, the coming implementation of ICD-10 will set the stage for improved patient care and public health surveillance across the country, leading to better identification of illnesses and earlier warning signs of epidemics and pandemics, such as Ebola. Over time, ICD-10 will improve coordination of a patient’s care across providers, advance public health research and emergency response through detection of disease and adverse drug events, support innovative payment models that drive quality of care, and enhance fraud detection efforts.”
Sounds good. Here’s the rub: Whereas ICD-9 had about 13,000 codes, ICD-10 has about 69,000. It’s all in the name of granularity.
For example, ICD-9 offers up to six codes for a sprained ankle; ICD-10 is said to accommodate more than 70. It does so by expanding the number of diagnosis codes from five digits to seven. This expansion of codes doesn’t reflect the emergence of new diseases or injuries so much as more specificity. For example, the new codes accommodate laterality. So, instead of indicating merely “sprained ankle,” providers must specify which ankle was affected.
“Epidemiologists ran amok with the coding system,” says coding consultant, author and speaker Betsy Nicoletti, MS, CPC. “Does it really matter which joint the patient has gout in – whether it’s the elbow, shoulder or toe? Does that advance population health? Do we really need to know if a patient has an ear infection in the right ear, left, or both?
“Maybe hospitals will like it. Maybe the epidemiologists will too. But it won’t do one thing for physician practices, except slow them down. But if they want to get reimbursed, they have to do it.”
Greg Dean, vice president, technology partners, McKesson Medical-Surgical, has a different perspective.
“I believe the conversion from ICD-9 to ICD-10 is a very positive step,” he says. “Although ICD-10 might cause temporary growing pains as the market implements it, in my opinion, the overall outcome is positive. ICD-10 will increase specificity, which in turn provides more detail, and this can help to improve patient care and outcomes. Additionally, ICD-10 could benefit medical research, improve performance, create efficiencies, aid in policy-making, and help in creating new pay-for-performance programs. The increase in detail and specificity can provide more insight for the future of healthcare.”
Why are we doing this?
Even some physician groups voiced support for ICD-10.
“After the initial growing pains, physicians and support staff will be able to communicate easily regarding the specificity of diagnosis and corresponding orders,” says Barbie Hays, ICD-10 certified trainer and coding and compliance strategist, American Academy of Family Physicians. “For example, a classic physician order for a sprained ankle may be an X-ray. If the physician forgets to determine right or left in the order, the technician had to stop the test and query the physician. However, with ICD-10-CM, laterality is built into the code – S93.402A.”
Others are not as convinced.
“Generally, I feel the costs and risks associated with the transition to ICD-10 at this juncture are ill-advised,” says Tom Schwieterman, MD, medical director, Midmark Corp. “The regulatory and compliance complexity already created by Meaningful Use, the [Physician Quality Reporting Initiative, or PQRI], integration of private practices into larger systems, and advancing requirements related to emerging value-based reimbursement has overwhelmed change management initiatives. ICD-10 should be delayed until the dust has settled from previously mandated initiatives.”
Robert Tennant, director, health information technology, Medical Group Management Association, points to one of the greatest myths surrounding ICD-10, “We’re the last country on earth to convert to ICD-10.” Woe is us.
“That’s completely false.”
The World Health Organization created a baseline set of standards for ICD-10 that called for about 12,000 codes, he explains. Each country is free to modify that set as it wishes. German healthcare providers, for example, use about 13,000 codes. Canada, about 20,000; and if one considers only Canadian physicians and not hospitals, it goes down to about 600 codes. The U.S. version, however, calls for about 69,000 codes. “They took the foundation set and significantly expanded it,” says Tennant. U.S. physicians are also reimbursed based on a combination of these diagnosis codes and procedure codes, not typically the case in countries with national health systems.
As if transitioning to this new code set weren’t challenging enough, providers are also facing the conversion to Stage 2 of Meaningful Use, a daunting task all on its own, says Tennant. Physician practices are also still focused on implementation of the 5010 transaction set, which dictates how providers conduct electronic administrative transactions, such as eligibility inquiries and remittance advices, he points out. “There has been a lot of time, energy and money spent on health IT lately by physician practices. We need to ensure that this investment translates directly into improved patient care and streamlined administrative processes.
“The difficulty is, no one has done a credible job of explaining how patient care will be improved by the use of these codes or how they will lead to reduced paperwork. That’s why physicians have been pushing back [against ICD-10] over the years.”
How prepared?
Starting on Oct. 1, Medicare claims with a date of service on or after that date will only be accepted if they contain a valid ICD-10 code, according to Slavitt. The Medicare claims processing systems will not have the capability to accept ICD-9 codes for dates of service after Sept. 30, 2015, or accept claims that contain both ICD-9 and ICD-10 codes.
That said, for 12 months after ICD-10 implementation, Medicare review contractors have been instructed to refrain from denying physician or other practitioner claims billed under the Part B physician fee schedule through either automated medical review or complex medical record review based solely on the specificity of the ICD-10 diagnosis code, so long as the physician/practitioner uses a code from the right family.
American College of Physicians President Wayne J. Riley, MD, expressed relief when the 12-month grace period was announced in July. “The change from ICD-9 to ICD-10 is one of the largest technically challenging transitions for physicians in the past several decades,” Riley wrote in a prepared statement. “Although the coding conventions in ICD-10 are similar to those used in ICD-9, there are many differences. Undoubtedly, these differences will create opportunities for errors in coding accuracy.
“Therefore, ACP appreciates that CMS has directed the Medicare Administrative Contractors (MACs) and Recovery Audit Contractors (RACs) not to reject or deny claims based solely on an error due to the lack of accuracy or specificity within the appropriate code family during this transition.”
Grace periods aside, the question is, How prepared are physician offices to implement ICD-10 – and get paid for their services?
“Many industry analysts state that a large portion of the independent or private practice market remains unprepared for the upcoming change,” said Dean one week prior to the Oct. 1 deadline. “Much of the market has completed some level of educational training to prepare for the upcoming change, but is that enough? Yet some have not completed system upgrades or examined how their business will operate under the new code set.
“It is very important to conduct test transactions in order to identify risk and more complex ICD-9 to ICD-10 mapping. If you don’t actually test or model your business in ICD-10, how can you actually know the impact of this transition?”
Says Hays, “We do not have any facts or figures. As a whole, we are not hearing the masses cry. Sure, there is some lamenting going on, but that is the case with any change, major or minor. I hope that physicians have taken heed to the warnings that ICD-10-CM is a reality. The majority that I have spoken with have taken steps to ready themselves for the transition.”
The preparedness of the country’s medical practices varies tremendously, says Nicoletti. “The bigger groups are ready. They have had training, they have tested their software, they have looked at their codes. But from the questions I get from some of the smaller groups, it’s clear some don’t have a book, they don’t have codes in their system, and they’re waiting for upgrades [from their EHR vendors].”
EHR vendors, on the other hand, are much more prepared, says Nicoletti. “I would think every vendor would have the ICD-10 codes loaded into their system,” she said two weeks prior to the deadline date. That said, when going from 16,000 codes to 70,000 codes, mapping or “translation” systems can’t be fully trusted.
“Practices are stuck with whatever software they have,” she says. “Some doctors will find their codes with an extra 30 seconds of work, for some it will take minutes.”
At press time, four state Medicaid systems – California, Maryland, Montana and Louisiana – had obtained waivers from CMS allowing them to continue to use ICD-9 codes. They will take in the ICD-10 codes, then “crosswalk” them back to ICD-9 and adjudicate the claim.
The results could be troublesome. “How many claims does the state of California have?” asks Nicoletti, rhetorically. “This will cause denials. You can’t cross back very easily. They can try, but it won’t work.”
Payment delays?
There are fears that lack of preparedness will lead to payment delays, even with the grace period.
“No doubt the claims acceptance rate will fall,” says Schwieterman. “I cannot predict how much. With cash flows at smaller institutions already challenged in many cases, any disruption in the revenue cycle from ICD-10 backlogs may prove to be quite impactful to systems with smaller reserves.”
“I have heard similar predictions around a decline in claims acceptance rates,” says Dean. As a precaution, some practices have been advised to retain six months of cash in reserve, he says. “I do identify with the severity and challenges this transition might present. This is why quality planning and preparedness is critical.” The 12-month grace period should help.
AAFP’s Hays predicts “there will be some bottleneck at various levels of the payment scale. I anticipate these barriers will be similar to the Form 5010 transition in 2012. However, from that experience, we learned how testing should be done, such as interactivity between systems, between physicians’ offices and clearinghouses, clearinghouses to payers, and the resulting return paths. It will be of paramount interest to physicians to follow the claims process closely and daily to determine receipt of information by these entities within the loop.
“The single most important thing a physician can do is to document. As I just stated, the next thing is to monitor claims activity. Don’t take for granted that the path won’t have any ruts. Be proactive.”
Physician practices may find the greatest difficulty lies in coding laboratory procedures, says Nicoletti. The ICD-10 coding for thyroid testing, for example, is far more detailed than ICD-9. “It explodes to all the covered indications,” she says. What’s more, the codes for lab procedures span all the chapters in the ICD-10 book. “The covered condition could be anywhere, so that really does change things significantly.”
“You’ve got a perfect storm of problems,” says Tennant. “[EHR] vendors have been scrambling to meet the government’s requirements for Meaningful Use. Have they been as diligent on the practice management system side for ICD-10? Time will tell.”
Vendors are not required by law to do any upgrades for ICD-10, Tennant points out. “It’s a business decision.” In the months and weeks leading up to the Oct. 1 deadline, many practices were waiting for their vendors to send an ICD-10 upgrade. “Without that upgrade, they can’t submit claims through their practice management system. So we are looking at potential payment disruptions, which ultimately could impact access to care.”
Tennant found particularly disconcerting CMS’s waiver for the four state Medicaid systems. “We have asked for information on state readiness for five years, and were always told, ‘Don’t worry, they will be ready.’ So this was the first inkling that some states are not ready. You could say, ‘Well, Medicaid isn’t that big,’ but it is getting more important and has a bigger footprint because of Obamacare.”
How to make the transition?
Adding to some physician practices’ fears about conversion to ICD-10 is the cost involved. A 2014 study conducted on behalf of the American Medical Association estimated that the potential cost to a small practice could range from $57,000 to $226,000; for a medium practice, anywhere from $213,000 to $825,000; and for a large practice, between $2 million and $8 million.
“The two largest areas of pre-implementation cost are the training of providers and staff and EHR system upgrades and installation,” says Hays. “It is important to note, though, that many EHR and system vendors, such as [those of] EKG machines, are providing upgrades and training at free or very low-cost price points.” Meanwhile, post-implementation costs could include claims management for denials and monitoring, and the potential for additional training and upgrades based on go-live performance.
Practices are going to have to do a few things in order to make a successful transition to ICD-10, says Tennant:
- Clear the decks of any outstanding claims with dates of service prior to Oct.1. “Don’t sit on them. Try to get money coming in as soon as possible.”
- If its EHR software isn’t ready, or if the practice has reasons to doubt its readiness, the practice can make use of a stopgap measure by submitting claims using the payer’s “portal” approach on its website. With each payer portal being different and requiring a separate registration and login, practices should have familiarized themselves with the portal prior to the Oct. 1 deadline, so they don’t waste time and potentially delay the adjudication process.
- In the event of a significant increase in rejected claims or delays in claims payment, practices should reach out to their local financial institution(s) to establish a line of credit, just in case.
- Practice owners should set aside some cash reserves to make sure they can meet their financial obligations should payments be significantly delayed.
Distributors and manufacturers can help.
“In my experience, distribution representatives can oftentimes be excluded from discussions or planning around the financial aspects of a medical office,” says Dean. “I would encourage representatives to ask the basic questions surrounding ICD-10, such as, ‘Are you prepared for the upcoming ICD-10 conversion?’ If yes, ask your customer specifically what they have done to prepare. And lastly, ask your customers if they have tested transactions or modeled their business under the new ICD-10 code set. These questions will help you identify if you can potentially provide additional ICD-10 conversion support to your valued customer.”
Distributors can ensure assistance is provided to physicians and their staffs in the form of updated prior authorization forms, says Hays. “Offer to discuss or pave the way with insurers if offices are receiving slow responses for authorizations for procedures or prescriptions. Make sure updated coding ‘cheat sheets’ are distributed.”
Adds Schwieterman, “Manufacturers should understand how ICD-10 will affect coding guidelines for their particular diagnostic device or therapeutic regimen. Providing customers with updated coding guidelines could be very helpful to ease the process of achieving reimbursement.
“Many times, medical devices are not employed within care delivery every day, so such coding aides could help remind clinicians of best practices at the point of care.”
Resources
CMS, ICD-10 Resources, https://www.cms.gov/Medicare/Coding/ICD10/Downloads/ICD10ResourcesFlyer20150817.pdf
CMS: “Road to 10: The Small Physician Practice’s Route to ICD-10,” http://www.roadto10.org
CMS: “ICD-10-CM INDEX TO DISEASES and INJURIES,” http://cdn.roadto10.org/wp-uploads/2015/09/2016-ICD-10-CM-Index-to-Diseases-and-Injuries.pdf
CMS, “ICD-10-CM TABULAR LIST of DISEASES and INJURIES,” http://cdn.roadto10.org/wp-uploads/2015/09/2016-ICD-10-CM-Tabular-List-of-Diseases-and-Injuries.pdf