ICD-10 Transition: Ready or not, here it comes!

 The ICD-10 transition is coming!

The calendar is ticking down the days to the deadline for U.S. health care providers to transition from ICD- 9 to the 10th revision of the International Classification of Diseases or “ICD- 10” on October 1, 2015.

The Department of Health and Human Services (HHS) finalized regulations in 2009 that require health plans and providers to transition from the older ICD-9 code set for diagnoses and procedures, to the newer and more detailed ICD-10 code set. Despite last year’s compliance date delay, many individual providers are still not ready according to a recent survey done by the American Group Management Association (AMGA) a trade organization for physician groups.

ICD-10 Transition: 100 years in the making.

The World Health Organization (WHO) created the International Classification of Diseases (ICD) over 100 years ago. The code set is used internationally to standardize codes for medical conditions and procedures. The U.S. is behind other industrialized nations who have been using ICD 10 since 1994.  Advocates for the ICD-10 transition say ICD-9 contains outdated and obsolete terms. The ICD-9 diagnosis and billing codes the U.S. currently uses have not been updated in more than 35 years. With the ICD-10 transition, diagnosis codes will rise from 13,000 to 68,000. The increase in the number of codes is a result of improved diagnosis specificity, precise anatomical location and treatment and stage of treatment. The bulk of the new codes are related to orthopedic conditions, but every area of medicine is affected, and there is no relationship between the coding systems of ICD-9 and ICD-10.

ICD-10 transition: What are the risks of not preparing?

Despite regulations requiring the ICD-10 transition in the U.S. issued in 2009, many health care providers are still not ready for the transition. They cite the cost and administrative burden of the ICD-10 transition as reasons, in addition to their belief that the transition does not improve the quality of patient care.

The biggest risk to individual providers who are not ready for the ICD-10 transition is claim payment delays and denials. For small practices this could have adverse financial consequences. Although ICD-9 advocates claim that providers are paid by CPT codes, unless the correct ICD-10 code is accompanying the claim, there will be delays and denials.

Small practices may not have electronic health records (EHRs) or electronic billing software; even those that do are concerned that inadvertent coding errors or system glitches during the ICD-10 transition may result in audits, claims denials, and penalties under various Medicare reporting programs.

The potential good news for individual providers and small practices is that earlier this month, two House lawmakers introduced a bill, The Coding Flexibility in Healthcare Act of 2015, or Code-FLEX, (HR 3018) that would allow for a six-month period where claims would continue to be processed and paid if submitted with ICD-9 codes.  It also would require HHS to report to Congress after 90 days on how ICD-10 codes are affecting providers, patients and stakeholders.

ICD-10 transition

In addition, the Centers for Medicare and Medicaid (CMS), under pressure from the American Medical Association (AMA), recently announced a set of measures designed to help ease physicians’ transition to the new ICD-10 code sets.  Under the new measures, CMS said it plans to establish a one-year grace period in which it will reimburse physicians under Medicare Part B for claims with incorrect ICD-10 diagnosis codes.

The ICD-10 transition date remains October 1, but for the first year Medicare will not deny claims solely based on the specificity of diagnosis codes as long as they are in the appropriate diagnostic family of codes.  This means physicians won’t be financially penalized because of a “minor” coding error.  And CMS has not yet defined the term “diagnostic family”

However, it is still true that CMS will not have the capability to accept claims with ICD-9 codes for dates of services after September 30, 2015, nor can CMS accept claims with both ICD-9 and ICD-10 codes.  So all claims must have a valid ICD-10 code.

While there are no specific fines or sanctions provided under the final ICD-10 or 5010 final rules, both are governed by HIPAA. HIPAA investigations can result in sanctions for violations of HIPAA transaction and code sets.  HIPAA calls for civil penalties with fines up to $25,000 for multiple violations of the same standard in a calendar year.

So while there are no fines for failing to make the  ICD-10 transition (at least not yet!) the Office of Civil Rights (OCR) can still impose penalties under the broader HIPAA umbrella. OCR can, in fact, levy fines and so the question becomes: will it exercise that option?

What should you do to be ready for the ICD-10 transition?

Providers who are not ready for the ICD-10 transition should quickly assess their status and develop an ICD-10 transition plan that includes:

  • Implementing ICD-10 training appropriate to the role of each staff member,
  • Identifying the practice’s top 25-50 most commonly used codes,
  • Practicing coding and validation of high volume, high dollar encounters with both ICD 9-and ICD-10 codes,
  • Seeking payer or independent coder evaluation of the process,
  • Checking whether necessary ICD-10 claims processing software updates have been completed by vendors,
  • Developing work-a-rounds, for example, for submitting claims to payers who are not ICD-10 compliant using ICD-9 codes.

Although there are still efforts to delay or at least moderate the effects of the ICD-10 transition, there is no doubt it will happen sometime in the future – and the future is likely to arrive on October 1, 2015!

When you need proven expertise and performance

Deborah Schlesinger, RN, BSN

Ms. Deborah Schlesinger has been managing corporate risk for over two decades. Her expertise includes privacy & security for Medicare. She has a Certificate in Healthcare Risk Management (ASHRM), and has earned the Certified Healthcare Privacy Compliance designation.

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