Is ICD-10 the Industry's Wake Up Call?

Health Data Management Magazine, 05/01/2010

In March at the HIMSS 2010 conference, Rose Ann Laureto experienced her ICD-10 epiphany. "Before then, we were not fixated on ICD-10," says Laureto, citing an educational seminar she attended detailing the particulars of the new code set. "We are now."

By all counts, the University of Illinois Medical Center CIO has plenty of company-at least in her pre-HIMSS oblivion to the forthcoming federally mandated transition to a new set of diagnostic and procedure codes. Set to take effect in October 2013, ICD-10 replaces its predecessor, ICD-9, with a far more comprehensive catalog of descriptive terminology, some 155,000 total codes in all (ICD-9 contains about 24,000). But there's far more to adopting ICD-10 than coming to terms with its increased granularity of detail. The scope of this transition is monumental, touching virtually every nook and cranny of the health industry, impacting providers, payers and vendors.

What bothers many experts is not that scope, but rather the industry's lack of preparation thus far to adapt to it. The tardiness may, in a few short years, wreak havoc on revenue streams, data sharing efforts, and perhaps even patient safety. In addition to being behind schedule, the industry is facing a transition that, at best, is defined by its uncertainty. The number of unanswered questions is staggering, and only begins to suggest the risk the industry faces. Adding to the uncertainty is a certain malaise, particularly on the part of providers, who question the long-term value of a transition effort that is likely to drain precious resources. Even ardent proponents of ICD-10 acknowledge that any return on investment will likely be long in coming.

Given this shaky foundation, one might ask why the government is pushing ahead with the building plan. The answer to that varies widely. Some experts point out that ICD-9 is woefully inadequate when it comes to describing procedures and diagnoses. And that very inadequacy-ICD-9 cannot distinguish laterality of procedures, for example-leads to disputes between providers and payers, who must reimburse based on service delivered.

"We are the only industrialized country not using ICD-10," says Kathy DeVault, manager, professional practice resources at Chicago-based AHIMA, a membership organization of coders and health information managers. "ICD-9 is outdated and we cannot expand it. It doesn't meet the need for more accurate health care data and ICD-10 is better for computer-assisted coding." A less noble view of government intentions emerges, however, from many executives who have watched in dismay as reimbursements have been ratcheted down. To them, ICD-10 is the wolf wrapped in sheep's skin. The advent of evermore-granular data, they say, will facilitate even more diminished reimbursements.

Huge Scope

One area of consensus among both the proponents and skeptics is that the scope of ICD-10 is unprecedented. Both sides of the payer-provider aisle will need to closely examine their information systems-and business processes that shape their use. "This will be the most significant overhaul in the coding system since we began using computers," says Jim Daley, director of IS risk and compliance at BlueCross BlueShield of South Carolina, Columbia. "You can't find systems or business functions within an insurance company that don't deal with diagnosis or procedure codes or their derivatives." Daley ticks off a list of common payer systems that will be affected by ICD-10, including enrollment, managed care, claims, and underwriting. And when you drill down into how the systems actually operate, the list grows. "You could say that claims is one system, but it is really a series of applications. Depending on how you count them, you wind up with a much larger inventory."

Serving as co-chair of the ICD-10 Workgroup at WEDI, a membership organization that promotes electronic data interchange, Daley has compiled a list of more than 100 systems affected by the transition to ICD-10. Providers too face an equally daunting challenge of first identifying which information systems rely on diagnosis and procedure codes, then figuring out how to train staff that uses them. "We'll be able to handle the technology," says Gary Barnes, CIO at Medical Center Hospital, Odessa, Texas, a 362-bed community hospital. "The biggest challenge will be within the coding and physician areas, and having to learn so many new codes."

Standing between the health plans and providers are claims clearinghouses, the ubiquitous fiscal middlemen through which the vast majority of industry claims are routed. And while clearinghouses may not maintain the vast scope of information systems of the providers and payers they serve, they too must prepare. Some clearinghouses envision themselves functioning as a type of claims watchdog, identifying compliance with the new standards and assisting providers with enacting them. They're also in the middle of what could easily become a tangled affair if providers or payers are not equipped to process claims in the proper format come the fall of 2013. "There will be many ways payers implement ICD-10," predicts Ken Bradley, vice president of strategic planning at Navicure, a Duluth, Ga.-based clearinghouse that processes some 5 million claims a month. Serving about 20,000 physicians, Navicure works with some 4,000 health plans, including all 50 Medicaid payers and the 15 regional jurisdictions that accept claims for Medicare. "Our job will be to stay on top of which payer is doing what," Bradley says. "Some payers will say no to ICD-9 claims after the 2013 deadline, others won't be that strict and will map from ICD-9, and some won't be prepared at all."

Lack of preparation does not shock industry insiders like Daley, whose work with WEDI suggests the industry overall is behind schedule in making the switch to ICD-10. WEDI routinely surveys its members and others to keep tabs on progress. "We are finding that the industry is dragging its heels on ICD-10," says Daley. "We are very concerned it won't move fast enough to do what needs to be done."

Multiple Distractions

If the industry is behind, the reasons are legitimate, many experts point out. Distractions have included federal RAC audits, the promotion of health information exchanges, and the implications of national health care reform. Moreover, during the past year, providers have been preoccupied with the prospect of tapping into the billions of dollars available through the "meaningful use" provisions of the federal EHR incentive program. That was the case with University of Illinois Medical Center, concedes Laureto. "We have been focused on meaningful use," she says. The 2013 implementation deadline for ICD-10 pushed it to the back burner at the academic medical center, which is eying its full share of EHR incentive payments, which come into play in 2011. "Organizations are neck-deep in EHR," adds Andrea Danes, senior principal at CSG Government Solutions, an I.T. consulting shop based in Chicago. "They likely won't have time to meet the ICD-10 deadline."

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