August 10, 2015

ICD-10 Implementation Beyond Covered Entities – Are States Ready?

By Sherry Wilson and Tina Greene


Sherry Wilson


Tina Greene

There are less than three months left for effective transition planning prior to the ICD-10 implementation deadline, and there are still unknowns regarding which states are adopting ICD-10 for workers’ compensation. Providers either will need to transition fully to ICD‐10 and/or be required to support both ICD‐9 and ICD‐10 in order to comply with federal and state requirements simultaneously as of Oct. 1, 2015.

Workers’ Compensation ICD-10 Implementation Differences Among States

While the workers’ compensation industry is increasingly aligning with HIPAA transaction and code set (TCS) rule, there are differences that need to be recognized. The industry is:

  • Exempt from the HIPAA regulations;
  • Governed by state law rather than federal regulations;
  • A legal system, not a health system; and
  • Required to follow rulemaking requirements, as appropriate, in order to adopt new code sets such as ICD10.

These differences result in state-specific requirements, making it difficult for national/regional payers, providers, vendors, and others to comply with these varying regulations. 

Why the Growing Concern About State Readiness?

A general assumption has been that states would be aligning with the rest of healthcare in adopting ICD-10. As of July 27, 2015, we were able to confirm, based on the 2014 WEDI Property and Casualty ICD-10 State Readiness Resource Center and the International Association of Industrial Accident Boards and Commissions (IAIABC) ICD-10 state survey results, that the U.S. Department of Labor and 25 states have aligned with the Centers for Medicare & Medicaid Services (CMS) ICD-10 requirements. This leaves less than three months for effective ICD-10 transition planning.

There is an industry need to better understand states’ plans to continue with ICD-9 or move to ICD-10, and to identify those states that have not yet declared which code set will be adopted. In the scenario in which there are no state regulations, a payer may need to support both ICD-9 and ICD-10 code sets. In addition, clearinghouses, practice management systems, and other third-party vendors must be able to accommodate for any state-specific ICD-9 or ICD-10 front-end edit, as applicable.

Unless states adhere to the federally mandated ICD-10 implementation date of Oct. 1, 2015, providers, payers, and vendors will be required to meet two sets of conflicting requirements, resulting in possible dual coding, billing, and payment systems issues.

In addition, the unknown status of states’ ICD-10 readiness also impacts workers’ compensation  payers that need to  comply  with  Medicare’s mandatory insurer reporting for non-group health plans, which contains reporting requirements for claims that may impact Medicare beneficiaries. This reporting requirement was previously updated to account for ICD-10 for claims with a CMS date of incident on or after Oct. 1, 2015.

If a state does not adopt ICD-10, payers may be forced to use one set of codes to satisfy state billing requirements and a different set of codes to meet federal CMS reporting requirements.

The adoption of standard transactions and code sets across all lines of business will enable stakeholders to realize the benefits of administrative simplification, including:

  • The elimination of conflicting diagnosis and procedure coding requirements;
    • The elimination of the need to maintain and store two different code sets by all stakeholders;
    • Much greater specificity and accuracy in diagnoses;
    • Data standardization, which enables the ability to compare data within and across industries, providing quality and efficiency measurements that may lead to higher-quality medical care; and
    • Increased stakeholder adoption.

Potential Impacts to Contingency Planning

There remain numerous unresolved questions regarding the states that have not confirmed their ICD-10 status. States that are not ICD-10-ready will impact coding, billing, and payment continuity, including stakeholders’ contingency plans. Some of the unresolved questions include:

  • Will a state require new rulemaking to adopt ICD-10?

If so, what is the expected timeline and contingency plan to assist stakeholders in maintaining business continuity during this transition period?

  • If ICD-10 is not adopted, what is the state’s stakeholder contingency plan for business continuity?
  • If ICD-10 is adopted, what is the state’s contingency plan for stakeholders that will not be ICD-10 ready? Will stakeholders be allowed to process ICD-9 during the transition period and still be compliant?  

Conclusion

It is critical that the workers’ compensation and healthcare industries assess the status of states’ ICD-10 readiness in order to help all stakeholders determine an appropriate contingency action plan to comply with both state and federal implementation timelines, regardless of whether organizations are HIPAA-covered entities.

Ensuring that all entities are implementing ICD-10 will help further the industry’s movement toward streamlining and automating end-to-end workflow processes in order to improve efficiency, improve patient outcomes, and lower costs across all lines of business.

What Industry Resources Are Available to Monitor State ICD-10 Readiness?

One key industry challenge has been the lack of a national reference resource center to allow providers to easily access the state ICD-10 regulations and statuses. In response to this industry need, the WEDI Property and Casualty Workgroup has established a “Workers’ Compensation State ICD-10 Readiness Resource Center,” which can be accessed at www.wedi.org. The ICD-10 Resource Center also provides the list of the confirmed ICD-10 states. There is an industry collaboration underway with the WEDI Property and Casualty Workgroup, including Jopari Solutions, Mitchell International, and others, to contact the remaining states in the next few weeks to provide the industry a comprehensive update.

In addition, the ICD10monitor has several excellent articles on workers’ compensation that can be accessed at www.icd10monitor.com.

About the Authors

Tina Greene is a senior regulatory affairs consultant at Mitchell International. She has 29 years of industry experience and serves in numerous leadership roles in national standard-making organizations.

Sherry Wilson is executive vice president and chief compliance officer for Jopari Solutions. She has more than 30 years of industry experience and serves in varies leadership roles with the national standard organization.

Contact the Authors

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EDITOR’S NOTE

Both Wilson and Greene, nationally recognized industry experts on workers’ compensation, will appear on Talk Ten Tuesdays, Aug. 11, 2015, at 10 a.m. ET.

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