The Effects of the ICD-10 Transition

If you've ever been on the billing and coding side of a medical practice, chances are you've heard a version of this question: "what do we call this for billing?" On the other hand, during peer-to-peer conversations, healthcare practitioners seem to explain clinical scenarios very well. What happens in this daily process that converts such a detailed description into something like "unspecified abdominal pain”?

Not surprisingly, the entities paying for most of these encounters eventually wanted to know a little bit more about their purchase beyond a single code that encompassed multiple diagnosis or procedures. In 2002, Nelly Leon-Chisen of the American Hospital Association described the situation clearly. "Code 99.29 . . . is used to report a variety of procedures such as an injection of epinephrine to cauterize a rectal ulcer, infusion of a narcotic into a pump for pain relief, insertion of an implant in the eye for slow release of an antiviral drug, and injection into the uterine artery to treat a fibroid."

Aside from the billing issues, oversimplifying or misclassifying a patient's illness also produces quality and safety issues. In some cases, radiology for example, patients are recommended to undergo studies or minor procedures and the only history provided may be the billing code on the prescription. One can see how this would be a problem for broad scans like a CT examination of the abdomen and pelvis if the code is "unspecified abdominal pain."

In the last article, we explored the groups behind the transition to ICD-10. Looking further down the line, let’s explore the effects of the coding system on medical practices.  

There is no question of the enhanced precision of ICD-10 when compared to ICD-9. The amount of total codes expanded from 13,000 to 68,000, by far the largest system change in terms of overall codes and increased specificity. Using gout as an example, there were only two ICD-9 codes for chronic gout – one when a tophus was found and one where it was not. In ICD-10, there are over twenty-five.

The American Health Information Management Association released an analysis of physicians’ outlook on ICD-10 and its effect on their practices in Winter 2015.

Most physicians stated that precision in documentation as well as subsequent code assignment was a challenge for their practices. Notably, many also admitted that they often downcode a patient’s diagnosis to avoid claim rejection, audit, or the negative consequences of noncompliance. As such, proper billing practices and payment maximization were both noted by physicians as two incredibly important areas for training and education opportunities.

The original implementation date for ICD-10 was October 1, 2013. It was postponed twice by The Centers for Medicare & Medicaid Services (CMS), in which officials cited an understanding of physicians’ fears of more rejected claims and the possibility of becoming overburdened with a nearly five-fold increase in billing codes. On April 1, 2014, President Obama signed into law the Protecting of Access to Medicare Act of 2014, delaying the compliance date until October 1, 2015.

Just over a year ago, both the American Medical Association and CMS, in a joint statement, said that claims would not be rejected solely on the basis of code specificity. Essentially, physicians would not be penalized as long as they submitted codes in the proper ICD-10 “family,” determined by a category code. In context, the category code for chronic gout is M1A, representing the basic condition, followed by characters indicating etiology, location, laterality and whether or not it is accompanied by tophus. All that is necessary to avoid penalization during the grace period is getting the M1A part correct.

For many, thus far, it seems that the transition has moved forward without major incident. There are several reasons why this may be true. First, CMS adopted several catch-all policies designed to help ease the transition – appointing an Ombudsman, implementing tracking systems geared toward ICD-10 specifically, and rolling out a program targeted toward helping smaller practices deal with the transition.

Additionally, some hospitals, health systems, IT vendors and payers formed teams with the sole purpose of addressing potential mass confusion. These have been instrumental not only for mitigating or preventing tactical errors, but have also resulted in an increased confidence for issue resolution and sustainable success in avoiding any major catastrophes. This is likely part of the reason that there hasn’t been much press about ICD-10 implementation disasters in 2016.

And still, despite the successes of the transition to ICD-10, it hasn’t all been smooth sailing. Shortly after ICD-10 went live last year, KPMG conducted a survey studying the immediate results. Eleven percent of the nearly 300 surveyed expressed the transition as a “failure to operate in an ICD-10 environment.” The survey seemed to indicate that this resulted from a combination of poor planning and natural growing pains, including issues with clinical documentation and education of the physicians adopting the new system. Some of these organizations saw decreases in cash flow, either because of payer processing delays or claim denials.

Another issue with proper implementation was confusion about what the adoption date actually meant. ICD-10 requirements call for providers to code ICD-10 on claims with dates of service or discharge on or after October 1, 2015. However, some providers misread this requirement and applied it incorrectly to claims submitted on or after October 1.

Only time will tell if enforcing specificity via ICD-10 codes will be successful. We can be sure, however, that if the process increases the already onerous documentation burdens of today's medical practices, practitioners are going to find new "quick fixes" to stay in business, likely nullifying the efforts made to implement the larger coding system.

William Rusnak, MD's picture

William Rusnak, MD

Medical Information Advisor

William Rusnak, MD (@RusnakMD) is a resident physician in diagnostic radiology, financial investor, writer, and entrepreneur. He writes about topics such as healthcare information technology, data science, biotechnology, and prevention of chronic disease. With his involvement in several emerging healthcare companies, he is actively attempting to bridge the gap between medicine and information technology.

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