Physicians Will Be challenged By ICD-10 to Analyze Business Processes and Communication

Hospital based practices need to be concerned about specific issues related to the ICD-10 transition. By starting to prepare now, practices can alleviate several budgetary and operational challenges.

 

Here are some recommendations for practices as they start the implementation process.

 

Industry estimates for cost to a physician practice depends on the size of the practice. It should be noted that associated with physician retraining, system upgrades, or “soft items” such as process interruption and payer payment delay should be factored when considering the total financial impact..

 

A more inclusive view of all associated costs can be found within the Nachimson Advisor Study. The Medical Group Management Association reported from a recent Nachimson Advisors Study that the average cost of moving to ICD-10 based on practice sizes were as follows:

• Small practice (3-9 physicians) = $83,000

• Medium practice (10-99 physicians) = $285,000

• Large practice (100+ physicians) = $2.7M

 

The bottom line is that practices should consider all facets of their business as they estimate costs for ICD-10 implementation, including size, physician training, technology and overall adaptation.

 

Physician practices, hospitals and referring providers must quickly adapt to necessary documentation changes. The United States version of ICD-10-CM (Clinical Modification) contains approximately 68,000 codes compared to the approximately 13,000 of ICD-9-CM. The magnitude of this difference is at once testament to the daunting size of what we must accurately classify and to the inadequacy of our existing system to do so. Failure to adapt rapidly may result in payment denials and delayed revenue. To reduce the likelihood of revenue disruption, physician practices should communicate early with their clinical partners about the upcoming change to ICD-10.

 

Billing companies should be working with billing system vendors, claims clearinghouses and other partners to assure they are ready for ICD-10. In the same token, physician groups should be communicating with their partner vendors and referring physicians about the upcoming transition to ICD-10, and specifically regarding technology upgrades.

 

It may be anticipated that electronic health records (EHR) will not only incorporate documentation prompting designed to facilitate ICD-10 coding standards, but will likely have built in intelligence designed to extract the optimal codes to select from. Certainly, any decision related to purchasing new software in the coming three years should include due diligence with respect to the system’s ability to navigate and handle the ICD-10 code sets.

 

It would be wise for physician groups to include ICD-10 in their payer contract negotiation discussions over the next two years for decreased risks concerning compliance errors and claims denials. Dual coding during the training process in both ICD9 and ICD-10 coding would establish a good track record of how specific procedures being done by each physician would translate ICD-10. It will help you practice ICD-10 coding and clinical documentation but also help in future negotiations with the Payers.

 

 

Practices can and should prepare for a potential disruption of cash flow. Based on previous experience with HIPAA transaction code implementation, many groups anticipate similar problems with Medicaid programs. In fact, it is likely this will be more substantial than before since Medicaid is undergoing expansion under healthcare reform. A lack of adequate enforcement tools may also pose a challenge for practices, including penalties for payer readiness failures. These are far less than compliance costs however, which may delay and further confuse widespread adaption to ICD-10.

 

Strategic thinking and preparation that involves costs analyses and effective communication with vendors and payers will assure that practices will be ready to implement these changes by 2013.