January 6, 2012

ICD-10 Spotlight: Practice Preparation

By Annie Boynton, BS, RHIT, CPC, CCS, CPC-H, CCS-P, CPC-P, CPC-I, CPhT

As we move into 2012, the federally mandated ICD-10 implementation date of Oct. 1, 2013 is only about 600 days away. If you haven’t gotten started already, the time to begin ICD-10 preparation is here.

On Jan. 15, 2009 the U.S. Department of Health and Human Services (HHS) issued a final rule stipulating that all HIPAA-covered entities must transition from the 4010 version of the electronic transactions standards to the 5010 version effective Jan. 1, 2012 – and that the current ICD-9 code set will be replaced by ICD-10 effective Oct. 1, 2013. Even though there has been nearly five years to prepare for the ICD-10 mandated transition, the majority of the healthcare industry only just is beginning to strategize this critical initiative.

Let’s be clear about the scope of ICD-10 and the significant impact this code set transition will have on healthcare: ICD-10 is going to change everything about the business of medicine. Implementation will be a critical milestone in our ability as a nation to achieve true administrative simplification, value-based purchasing and an increase in the sophistication of healthcare data collection systems worldwide.

Three Steps to Ensure ICD-10 Compliance by Oct. 1, 2013

  1. 1. Know your ICD-9 World

Many physicians unfortunately do not grasp the extent to which their practices rely on ICD-9 data today. Physicians should be well versed in the business, clinical and financial aspects of the physician practice and should be aware of the critical role that coding plays in supporting the revenue stream. In the ICD-10 world, this will become even more critical. Many physicians already know their business and have direct knowledge of benchmarks such as productivity rates across their practices, especially since productivity is linked directly to revenue.

The industry has been warning physicians for the past few years that revenue almost certainly is going to be impacted for at least 3-6 months after the ICD-10 changeover. It is imperative to establish a solid financial baseline now to ensure that physicians and practices will be able to recognize, understand and prepare for the significant anticipated revenue impact in 2013 and beyond.

Data analysis, productivity analysis and financial analysis of a practice’s ICD-9 world is perhaps the most important thing a practice can do to prepare for the ICD-10 transition. This work will enable modeling, trending and forecasting for ICD-10, which likely will prove to be the deciding factor in whether a practice succeeds or fails post-ICD-10 implementation.

2. Assess Documentation Pitfalls

Success of ICD-10 implementation at the facility level will be largely dependent upon the quality of physician documentation. “Granularity,” “specificity,” “detail,” and other terms synonymous with ICD-10 implementation in the provider and facility community must be addressed. If providers do not emphasize detail in documentation habits, it could be virtually impossible for coders to select the correct ICD-10 codes.

Revenue in particular most certainly will be impacted negatively if documentation does not become more detailed. The specificity within the ICD-10 code set is much greater than in ICD-9. The following scenario, coded in both ICD-9 and ICD-10, clearly demonstrates the level of specificity in the ICD-10 code set.

Consider that a patient is seen for a subsequent encounter of a non-union for an open fracture of the right distal radius with intra-articulate extension and a minimal opening with minimally damaged tissue.

In ICD-9 this would be coded as:

813.52 Other Open Fracture of Distal End of Radius (Alone)

 


 

In ICD-10 this is coded as:

S52.571M Other intra-articular fracture of lower end of right radius, subsequent encounter for open fracture type I or type II with non-union

As the example indicates, ICD-10 contains much more detail and will require much more specificity in order for coders to select the most appropriate codes. While unspecified codes still exist within ICD-10, it is much more difficult to use them because of the detail found within the ICD-10 code set. Documentation will be critical to maintaining practice revenue in 2013 and beyond.

Begin an analysis of documentation habits now rather than later. Physicians who currently are being chased down to correct or modify documentation can expect this to become a much more significant issue when ICD-10 goes live. Practices can lessen the impact by conducting thorough documentation analysis today to avoid future financial pain tomorrow.

3. Plan Financial Solutions

Because many practices will struggle to find at least three to six months of revenue to sustain them beyond the ICD-10 implementation date, it is critical to develop an ICD-10 financial transition plan as far in advance as possible. Be aware that impact to people, business processes and technology will be costly. The bottom-line recommendation is to begin setting aside funds today or to establish a contingency plan such as asking for a business loan or business line of credit – and to begin making inquires now. Do not wait until late 2012 or early 2013 and expect banks to hand out a loan or a line of credit, as it likely will not happen at that point.

Performing one’s due diligence now, involving a thorough analysis of ICD-9 business and being prepared with tools and/or business processes to analyze cash flow, will help physicians and administrators better understand fiscal needs as of 2013. Be aware that banks tend to be more forthcoming with loans requested in a proactive manner. It will take significant financial analysis and planning in order to secure funds from banks, particularly in light of the recent challenges faced by the banking industry. Waiting until late 2012 or 2013 to begin financial planning will be seen as tantamount to an act of desperation.

Again, Oct. 1, 2013 is roughly 600 days away. ICD-10 is perhaps the largest healthcare initiative we have ever seen in the United States. It is imperative that ICD-10 becomes a top priority project for physician practices and facilities across the country in order to ensure business as usual on Oct. 1, 2013 and beyond. As such, begin these steps today to set the foundation for ICD-10 compliance.

About The Author

Annie Boynton has served in the health information management field for over 10 years in provider, payer and educational capacities. Currently, she is the Director of 5010/ICD-10 Communication, Adoption and Training at UnitedHealth Group, where she helps lead their ICD-10 transition. Annie is also active with the American Academy of Professional Coders as a developing member of the ICD-10 Training Team and member of their National Advisory Board.  In her past roles, Annie also served as an adjunct faculty member at Massachusetts Bay Community College, where she developed curriculum and taught medical coding, billing, administrative procedures and medical law and ethics.

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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.