Some organizations are ready, some are not, but soon we’ll find out how smooth or awful the ICD-10 transition will be.

It’s the middle of August, and the ICD-10 compliance date is just a month and a half away. If your organization is far from being ready, there are some steps to take now that will help you at least muddle through the rest of the year and financially survive.

Also See:AHA Issues ICD-10 ‘Homestretch’ Checklist for Hospitals

Other organizations are in a better position and will be wrapping up loose ends. While many organizations stopped or slowed down ICD-10 work in the spring of 2014 after the compliance date was delayed, many ramped up efforts in recent months, restarting coder training and implementing clinical documentation improvement programs, aimed at helping physicians to increase the specificity of their notes and codes.

Slower pace

Eight-hospital Kettering Health Network, serving southwest Ohio, did not stop physician education last year because it didn’t want the doctors to forget what they had learned, but it took advantage of the extra time and slowed down efforts. This summer, the push resumed, and an ICD-10 roadshow across the organization started in June, says Debbie Schrubb, corporate director of health information management services. Next came a focus on specificity so if a physician documents a broken femur, was it the right or left, and what part of the femur was broken? That education included reminders that treatment that wasn’t completely and properly documented won’t be fully reimbursed by insurers.

Training of coders at Kettering also slowed after the compliance delay, but coders still worked on one or two ICD-10 charts a day before training ramped up again this summer. Kettering also started preparing new workflows so it could react quickly if claims denials increase this fall. “We feel like we’ve done a good job, but we don’t know what the expectations of the payers will be,” Schrubb says.

In recent months, she’s tried to anticipate payer expectations, meeting with several to assess their readiness and testing with them. Tests went well, Schrubb notes, but she still doesn’t know if that will be the case when ICD-10 volume soars in October. She’s confident her larger insurers are ready, but worried about the small local ones.

In late July, Kettering set new baselines for such metrics as days in accounts receivable, discharge not billed days, cash on hand and denial rates. The organization will track these metrics and compare performance every day with the same day last year to understand the financial impact of ICD-10. For instance, if discharge not billed days increase, that would be a result of lower coder productivity with the new code set.

Some organizations have been setting aside cash to have a financial buffer if a sizable percentage of their claims are not being processed and paid on a timely basis. Others, like two solo physician practices managed by Joan Ross in the Fort Lauderdale region of Florida, don’t have cash to hoard but have costs that can be cut. Consequently, the practices temporarily have reduced staff and fringe benefits, no longer bring in breakfast and lunch and are not planning this year to distribute Christmas bonuses.

Grace Period

October and the rest of 2015 were shaping to be a scary time for providers and may well still be, but physicians got a big break in early July when the Centers for Medicare & Medicaid Services, under pressure from the American Medical Association, made several concessions that could significantly smooth the transition period.

The ICD-10 compliance date remains October 1, but for the first year of use for the new code set, 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 coding error.

Also in the first year, Medicare claims will not be audited based on the specificity of diagnosis codes if they are in the appropriate family of codes, and Medicare Administrative Contractors as well as Recovery Audit Contractors will be required to follow the policy. Further, if Medicare contractors cannot process physician claims because of any issues with ICD-10, CMS will authorize advance payments.

CMS also will establish an ICD-10 Ombudsman office to help physicians resolve problems that arise during the transition. Finally, with the new flexibility on claims denials, Medicare will not financially penalize physicians via a smaller reimbursement for errors in selecting and calculating quality codes for the EHR meaningful use, PQRS and Value-based Modifier reporting programs as long as they use codes within the appropriate family of codes. Penalties also will not be applied if CMS has difficulty calculating quality scores during the ICD-10 transition.

The CMS-granted grace period will help, says Alicia Waletzko, a senior advisor at consultancy Impact Advisors and, since January, the ICD-10 project manager under contract at Northwestern Memorial Healthcare in Chicago. Physician practices, particularly independent affiliated physicians, were a big focus for the system in recent months. The delivery system conducted a series of presentations for physician practices they don’t own because Northwestern still has a lot riding on their ICD-10 readiness.

It’s important to make sure that staff members in the independent practices are trained in ICD-10. If they’re still faxing paper order forms for lab and radiology tests or other procedures, they need to update the forms to an ICD-10 format. They also have to update superbills, which are populated via electronic health records and practice management systems with the information to generate claims.

Ready, with a caveat

At American Baptist Homes of the West, which operates a network of continuing care retirement communities and assisted affordable housing communities, there also is concern about the ICD-10 readiness of affiliated physicians who are independent of the organization, which serves parts of Washington, California, Nevada and Arizona.

Thinking positively, Jean McGill, clinical services director at ABHOW, says, “We have a good chance of making it reasonably painless.” But there’s a caveat: McGill knows what her team is doing, but she realizes that success also is dependent on outside physicians, case managers and other partners.

September will be busy with finalizing ICD-9 to ICD-10 crosswalks for various types of residents. Point Click Care, ABHOW’s software vendor, did much of the crosswalk development.

Nurses do much of the coding in long-term care and rehabilitation facilities. Residents come with diagnoses established by physicians, but the nurses verify the diagnoses and then translate ICD-9 codes to find the appropriate ICD-10 codes. Like many providers, ABHOW is focusing on the top 20 or so codes that will fit most situations. In the final march to the compliance date, the organization also is focusing on training nurses intensively on short-term treatment codes.

McGill believes that ABHOW’s partners are doing the best they can to be ready. “There will be technical glitches, but I don’t foresee gloom and doom.” And she likes ICD-10 because it is more descriptive and will help identify resident needs more clearly. “I see it as an improvement. ICD-10 will improve clarification among providers after a short period of pain.”

Payer worries

The ICD-10 compliance data may be October 1, but that falls on a Thursday, and compliance for many providers really starts on Monday, October 5. That’s because treatments on Thursday won’t be coded that day, because coders and billing staff will be waiting on supporting documentation and charge entry, so the first ICD-10 coded claims likely will start going out on Monday.

Ross, who manages the solo orthopedic surgery and pulmonary-critical care practices in Florida, got help preparing for ICD-10 from electronic health records vendor Kareo through consultations and web seminars, and is confident that she is ready. But she doesn’t know if clearinghouses are fully ready and flat-out worries about insurers.

For instance, when Ross submits a claim for a total knee replacement, code 715.16 under ICD-9, three payers have been dropping the final digit 6 and rejecting the code. She has to go on the payers’ web site and put the digit back in, but then it takes another month to get paid. Further, Medicare was the only insurer with which she could test ICD-10; her practices’ other payers did not offer ICD-10 testing.

Ross is pleased with the grace period and other concessions that Medicare has implemented, such as not having automated denials, calling it a very good policy, especially because 90 percent of the practices’ patients have Medicare Advantage coverage. And she hopes other insurers follow suit.

What most worries Ross is that she heard representatives of UnitedHealthcare speak at a seminar, and they called ICD-10 “a practice-buster.” They suggested that practices have three months of revenue in the bank, something that’s not possible for the practices she manages. “I want to be optimistic, but am a little nervous.” One of the physicians told Ross that he is financially able to handle a payment slowdown; the other has been in practice for 48 years, and he believes the transition will work itself out.

Fast-Tracking ICD-10 Readiness

For physician practices late in ICD-10 preparations, there is good news. “Most small electronic health records vendors could update you in a month,” says Alicia Waletzko, a senior advisor, and Impact Advisors, a consulting firm.

And there is not-so-good news, she adds. “For practices that have done nothing, to pick this up and complete it in September would be very challenging.” In reality, they should focus on the bare minimum to keep the lights on:

* Using the practice management system to identify the 20 or so most-used diagnoses and learn how to code them in ICD-10;

* Update the superbill in the HER;

* Look for the biggest front-end bottlenecks, such as the registration area not getting codes they need; and

* Make sure coders are quickly getting the information they need from in-house and outside physicians so that they can properly code.

Once into October, these practices should use the grace period during which CMS will not impose penalties for errors to look at the types of claims being denied and address the underlying issues, review provider documentation to ensure it is being done appropriately, and improve workflows, Waletzko advises.

A practice that knows its top 20 percent of diagnoses and is able to correctly code them under ICD-10 then could cover as much as 80 percent of its services, and that can be enough to survive while continuing to improve overall ICD-10 compliance, says Bob Witkop, solutions manager of advisory services at consultancy CTG Health Solutions.

But Witkop worries that insurers are not as ready as they should be. This summer, most insurers – regardless of size – still were not returning electronic remittance advice after ICD-10 tests with providers, he says. Rather, they were sending back spreadsheets or text documents as validation, rather than fully adjudicated claims sets. “It is very concerning about how well payers are going to be prepared,” he says.

Consequently, providers need to get as many claims as possible out the door in September to get as much money in the door before October 1 comes, Witkop says. “The go-forward mentality needs to be that we’re going to see crazy things coming back to us during the first 60 to 90 days. Get the bills out now.”

Providers who cannot electronically submit Medicare ICD-10 claims after the compliance date have several back-up options. Medicare offers free downloadable billing software; about half of all Medicare Administrator Contractors have Internet portals where claims can be submitted; and Medicare also will accept paper claims if certain waiver provisions are met (visit:

However, the reality is that providers seriously behind in compliance are in trouble. “If you are behind, I would be frightened,” says Debbie Schrubb of Kettering Health Network. “We may have slowed the pace but never stopped.” Those behind, she adds, will have to work 24x7 or get outside help.

Congress Still Looks to Tinker with ICD-10 Policy

In early July, the Centers of Medicare & Medicaid Services took major steps to protect providers from fallout from the ICD-10 transition. The agency implemented a grace period that would protect providers from financial penalties for ICD-10 coding errors for the first year, relaxed audits on the specificity of codes and opened the door to advanced payments if Medicare struggles with the new coding set.

Two members of the U.S. House of Representatives decided physicians still needed more help.

Reps. Marsha Blackburn (R-Tenn.) and Tom Price, M.D., (R-Ga.) introduced legislation, H.R. 3018, that would implement a transition period during which claims with ICD-9 codes could still be submitted and paid. While the CMS concessions in July covered only Medicare, this bill, if enacted, would cover all payers.

“With industry surveys indicating that critical provider partners are behind schedule in deploying billing and electronic health record software, it is clear that some physicians have no way to submit ICD-10 codes for payment,” Blackburn said in a statement announcing the legislation. “For this reason, it is critical to establish a transition period which allows the healthcare industry to ease into compliance instead of ‘flipping a switch’ on October 1.”

There are few legislative sessions left before the ICD-10 compliance date, but the bill leaves the door open for lawmakers to take action later if the transition is not going smoothly. Further, the bill sponsors have influence, serving on powerful House committees. Blackburn is vice chair of the Energy & Commerce Committee, and Price is on the Ways & Means Committee and also chairs the Budget Committee.

Moreover, bills sometimes don’t have to be enacted to change policy, as lawmakers and stakeholders put pressure on regulators to be more flexible, notes Robert Tennant, director of health information technology policy at the Medical Group Management Association.

The early July concessions from CMS, for instance, came following intense pressure from the American Medical Association and its members. The concerns of providers about what happens after October 1 remain legitimate, Tennant says. MGMA’s big worry is that large numbers of physicians, through no fault of their own, won’t be ready for ICD-10 because they have not received software upgrades from vendors in a timely manner and may have no way to submit ICD-10 claims, or they have been unable to adequately test with insurers.

In addition, a survey with nearly 600 respondents and weighed to MGMA members found 20 percent of practices still submit version 4010 formatted claims, three years after the ICD-10 supporting 5010 format was introduced. If some larger practices never made the change, it is likely that many smaller ones also did not. The 4010 format cannot accommodate ICD-10 claims. Further, Tennant notes, compliance with the 5010 transactions set included a six-month transition period, and ICD-10 is a considerably more complex task.

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