Updated on: March 16, 2016

AMA to Sebelius: Time to Reconsider ICD-10

Original story posted on: February 24, 2014

Citing a report predicting that preparation costs could hit physician practices far harder than previously imagined, the American Medical Association is urging U.S. Department of Health and Human Services Secretary Kathleen Sebelius to reconsider the mandate that ICD-10 be implemented nationwide by Oct. 1.


In a Feb. 12 letter to Sebelius, AMA Executive Vice President and CEO James L. Madara acknowledged the controversial nature of the request, but nonetheless insisted.

“The AMA recognizes that our position on ICD-10 is at odds with many other well-intended stakeholders in the healthcare industry,” Madara wrote. “We are not discounting the value ICD-10 data could have for research, public health surveillance, and other data analysis activities. Based on the concerns we articulate (here), however, we question the logic of requiring physicians to adopt a new coding structure at this point in time.”

Madara referenced a 2008 study by Nachimson Advisors LLC that estimated ICD-10 preparation costs for small, medium-sized, and large physician practices, listing projected price tags of approximately $83,000, $285,000, and $2.7 million, respectively.

Nachimson Advisors recently conducted an updated study, however, through which it established cost ranges for physician practices – approximately $57,000-$226,000 for small practices, $213,000-$825,000 for medium-sized practices, and $2 million-$8 million for large practices.

“The previous estimate did not account for the costs to upgrade to certified electronic health record (EHR) software since Congress had not yet enacted the Meaningful Use Program,” Madara wrote. “Therefore, many physicians are expected to have to spend considerably more to upgrade their software, given the new regulatory environment.”

The updated study used the same general methodology as the 2008 study, involving interviews with practices, vendors, and consultants while mapping out costs tied to education, process analysis, changes to superbills, information technology, documentation improvement, and cash flow disruption.

Noting that the hikes in the cost projections from 2008 to 2014 could be especially daunting for physicians who must pay for upgrades to their EHR systems and practice management systems, the updated study stopped short of demanding an implementation delay, but also made the scope of the issue clear.

“The transition to ICD‐10 is expected to be much more disruptive for physicians than previous HIPAA mandates, as they must adjust their documentation and other processes. Unlike previous HIPAA mandates where physicians could lean heavily on other partners, such as billing services, vendors, and clearinghouses, use of the new codes will require a much deeper level of involvement by the physicians themselves,” the study read. “These figures indicate that physician practices face significant costs with ICD‐10 implementation, and especially the risk of payment disruptions. A poorly executed ICD‐10 implementation effort will increase those risks and expose practices to large costs in 2014 and beyond.”

“Planning must take place now,” the study concluded, “so those risks can be mitigated and practices can continue to operate effectively.”

Apparently attempting to cover all bases in his seven-page letter, and despite labeling ICD-10 “financially disastrous” for physicians, Madara nonetheless also took the opportunity to renew the call for Medicare to conduct comprehensive end-to-end testing ahead of October’s implementation date.

“If it is not possible to conduct this type of testing with all physicians, then we strongly urge Medicare to conduct true end-to-end testing with at least 100 different physician practices of varying sizes and specialties. Any experience gained through such a testing exercise should be used to inform (the) Centers for Medicare & Medicaid Services’ (CMS) decision to adhere to the Oct. 1, 2014 deadline,” he wrote. “We believe end-to-end testing is essential for ensuring the healthcare industry will not suffer massive disruptions in claims and payment processing and ultimately risk physicians’ ability to care for their patients.”

And while the AMA’s CEO pointed to the Nachimson study to justify a call to reconsider ICD-10, he also went after its foundation, pointing out that the number of codes physicians and office staffs nationwide are expected to work with daily is poised to jump from about 13,000 to 68,000.

“Regardless of any informational reports or material posted on our website that discuss the feasibility of ICD-10 or ICD-11, AMA policy adopted by our House of Delegates calls for repealing ICD-10 for the simple reason that it is not expected to improve the care physicians provide their patients and, in fact, could disrupt efforts to transition to new delivery models,” Madara wrote. “The transition to ICD-10 represents one of the largest technical, operational, and business implementation in the healthcare industry in the past several decades.”

Plus, he added, physicians “are being asked to assume this burdensome requirement at the same time that they are being required to adopt new technology, re-engineer workflow, and reform the way they deliver care.”

“The AMA is committed to seeing physicians successfully transition to new payment and delivery reform models and adopt well-developed technology that promotes care coordination with real value to patients,” Madara concluded. “Adopting ICD-10, while it may provide benefits to others in the healthcare system, is unlikely to improve the care physicians provide their patients and takes valuable resources away from implementing delivery reforms and health information technology.”


Disclaimer: Every reasonable effort was made to ensure the accuracy of this information at the time it was published. However, due to the nature of industry changes over time we cannot guarantee its validity after the year it was published.
Mark Spivey

Mark Spivey is a national correspondent for ICDmonitor.com who has been writing on numerous topics facing the nation’s healthcare system (and federal oversight of it) for five years.