As the October 1 compliance deadline for ICD-10 arrives, some organizations are ready and some are not. Either way, we'll find out soon just how smooth-or how rough-the transition will be.

Some organizations are in a good position and just need to wrap up loose ends. Some slowed or even stopped their ICD-10 work in spring 2014 when the earlier compliance date was delayed; many recently ramped up efforts, restarting coder training and implementing clinical documentation improvement programs to help physicians increase the specificity of their notes and codes.

And others are still racing to meet the deadline. For them, there are steps they can take to muddle through the rest of the year and financially survive.

Eight-hospital Kettering Health Network, serving southwest Ohio, did not stop physician education last year because it didn't want doctors to forget what they had learned. However, it took advantage of the extra time and slowed its transition efforts.

This summer, it picked up the pace again, and started an ICD-10 "roadshow" across the organization in June, says Debbie Schrubb, corporate director of health information management services. Next came a focus on specificity-if a physician documents a broken femur, is it the right or left, and what part of the femur is broken? That education included reminders that treatment incompletely or improperly documented won't be fully reimbursed by insurers.

Training of coders at Kettering 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.

Resetting baselines

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, have stopped bringing in breakfast and lunch, and are not planning to distribute holiday bonuses this year.

Grace period

October and the rest of 2015 had been looking 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 ease 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 for coding errors.

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 is establishing 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 electronic health record meaningful use, physician quality reporting system 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 staff members in the independent practices are trained in ICD-10, Waletzko says. 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 EHRs and practice management systems with the information to generate claims.

Joint effort

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 Arizona, California, Nevada and Washington.

"We have a good chance of making it reasonably painless," says Jean McGill, clinical services director at ABHOW, trying to stay positive. But while McGill is confident that her own team is prepared, she says, the organization's success depends in part 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. PointClickCare, ABHOW's software vendor, did much of the crosswalk development.

Nurses do a lot of the coding in long-term care and rehabilitation facilities, McGill explains. While residents come with diagnoses established by physicians, 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 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," she says. "ICD-10 will improve clarification among providers after a short period of pain."

Because October 1 falls on a Thursday, compliance for many providers won't actually start until 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 EHR vendor Kareo through consultations and webinars, and is confident that she is ready. But she is concerned about clearinghouse and insurer readiness.

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' website 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 Medicare has implemented, such as not having automated denials-this a very good policy, she says, especially because 90 percent of the practices' patients have Medicare Advantage coverage. She hopes other insurers follow suit.

What most worries Ross is that she heard representatives of UnitedHealthcare, speaking at a seminar, refer to ICD-10 a "practice-buster." They suggested practices have three months of revenue in the bank, something shes concerned may not be possible for the practices she manages. "I want to be optimistic, but am a little nervous," she says. One of the physicians in the practices she runs assured Ross he is financially able to handle a payment slowdown; the other has been in practice 48 years and believes the transition will work itself out.

Fast-tracking readiness

For physician practices late in ICD-10 preparations, there is good news. "Most small EHR vendors could update you in a month," says Waletzko at Impact Advisors.

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:

* Use 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 EHR;

* 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.

Claims out, money in

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 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.

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

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