ICD-10 – An Introduction to the New Diagnosis Coding

The Untold StoryCharles Jarvis, Senior Manager Health Reform

cjarvis@cokergroup.com 610-811-4015/848-992-0281

Agenda

Brief Overview of ICD-10

ICD-10 Reality Check

Where to Start

The Technical ICD-10 Impact

Making the Transition

Contingency Planning

Summary & Questions

Top 10 Signs You are Not Ready for ICD-10

1. Your office is still using ICD-4

2. Your coding books are 2 years behind

3. The practice management system is not modern

4. No EHR strategy

5. No formal compliance training program

6. High volume of coding denials

7. Not sending claims electronically

8. No checks and balances

9. No self-audits

10. Your coder is in jail!

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Brief Overview

International Classification of Diseases (ICD)

• ICD-10 was endorsed by the 43rd World Health Assembly in May 1990 and came into use in WHO Member States as from 1994. The classification is the latest in a series which has its origins in the 1850s. The first edition, known as the International List of Causes of Death, was adopted by the International Statistical Institute in 1893.

• 25 countries use ICD-10 for reimbursement and resource allocation in their health system

• A smooth, successful transition by the compliance date of October 1, 2015, requires a well-planned and well-managed implementation process

• Experience in other countries has shown that early preparation is the key to success. Organizations that start early can spread their resources across multiple years, rather than incurring a large budgetary investment at one time

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Why Does IDC-10 Matter?

Diagnoses and procedure codes impact virtually every system and business process in plan and

provider organizations, with significant impacts on billing and reimbursement

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Impacts of Other Changes

• High Deductible Health Plans– Major increases in patient responsibility

– No requirement to spend HSA money on medical expense

• Real Time Adjudication– Near instantaneous response to a provider

claims

– Know patient responsibility immediately

– Less bad debt?

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• “The current system, ICD-9-CM, does not provide the necessary detail for patients’ medical conditions or the procedures and services performed on hospitalized patients.

• ICD-9-CM is 30 years old, • Has outdated and obsolete terminology (no code for ebola as a

stark example!), uses outdated codes that produce inaccurate and limited data, and is inconsistent with current medical practice.

• It cannot accurately describe the diagnoses and inpatient procedures of care delivered in the 21st century.”

http://www.cms.hhs.gov/ICD10

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Why the change?

Examples of ICD-10 Specificity• W21.00 Struck by hit or thrown ball,

unspecified type

• W21.01 Struck by football

• W21.02 Struck by soccer ball

• W21.03 Struck by baseball

• W21.04 Struck by golf ball

• W21.05 Struck by basketball

• W21.06 Struck by volleyball

• W21.07 Struck by softball

• W21.09 Struck by other hit or

• thrown ball

• W21.31 Struck by shoe cleats

• Stepped on by shoe cleats

• W21.32 Struck by skate blades

• Skated over by skate blades

• W21.39 Struck by other sports

• foot wear

• W21.4 Striking against diving

• board

• W21.11 Struck by baseball bat

• W21.12 Struck by tennis racquet

• W21.13 Struck by golf club

• W21.19 Struck by other bat, racquet or club

• W21.210 Struck by ice hockey stick

• W21.211 Struck by field hockey stick

• W21.220 Struck by ice hockey puck

• W21.221 Struck by field hockey puck

• W21.81 Striking against or struck by football helmet

• W21.89 Striking against or struck by other sports equipment

• W21.9 Striking against or struck by unspecified sports equipment

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ICD-10CM vs. ICD-10PCS

• ICD-10-CM/PCS (International Classification of Diseases, 10th Edition, Clinical Modification/Procedure Coding System) consists of two parts:

– 1. ICD-10-CM for diagnosis coding

– 2. ICD-10-PCS for inpatient procedure coding

• ICD-10-CM is for use in all U.S. health care settings. Diagnosis coding under ICD-10-CM uses 3 to 7 digits instead of the 3 to 5 digits used with ICD-9-CM, but the format of the code sets is similar.

• ICD-10-PCS is for use in U.S. inpatient hospital settings only. ICD-10-PCS uses 7 alphanumeric digits instead of the 3 or 4 numeric digits used under ICD-9-CM procedure coding. Coding under ICD-10-PCS is much more specific and substantially different from ICD-9-CM procedure coding.

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ICD-9-CM vs. ICD-10-CM

ICD-9-Clinical Modifications ICD-10-Clinical Modifications

3-5 characters in length 3-7 characters

About 13,000 diagnosis codes About 68,000 codes

Limited space for new codes Flexible for adding new codes

Lacks detail Very specific

Difficult to analyze data Data are richer and more accurate

Limited ability to identify affected body parts or organs

Allows laterality and bilaterality

Inadequate diagnoses hamper medical research

More accurate diagnoses boost research

Not used by other countries Allows data exchange

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Example of PCS Code

• ICD-9-PCS (sample code)

– 47.01 Laparoscopic appendectomy

• ICD-10-PCS (sample code) Laparoscopic appendectomy 0DTJ4ZZ

• 0 - Medical and Surgical Section

• D - Gastrointestinal system

• T - Resection (root operation)

• J - Appendix (body part)

• 4 - Percutaneous endoscopic (approach)

• Z - No device

• Z - No qualifier

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Structure of ICD-10 PCS

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Benefits and Challenges

• Mandatory

• Cost – time and money

• Learning something different

• Documentation requirements

• Improve business practices

• Improve reporting

• Reduce costs

• Increase efficiency

• Improve timely claim processing

ICD-10 Reality Check

There are a lot of rumors flying around the medical billing

industry about the transition to ICD-10 codes and what it will

mean for providers, payers and associated vendors. Here

are a few FACTs….

• ICD-10 Codes far outnumber those in ICD-9: TRUE

• The ICD-10 manual lists 68,000 codes, versus the 13,000 codes represented in ICD-9: TRUE

• ICD-10 codes are different than ICD-9: TRUE

• ICD-10 codes have up to seven digits, in part because they are more detailed and include information on the type of encounter and laterality of the condition: TRUE

• Your vendor will be ICD-10 compliant by the deadline: Mostly TRUE

• Making sure your vendor is ICD-10 compliant is the only thing to worry about: FALSE

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Vendor Readiness

Staff Training

Upgrading IT

systemsTESTING

Clearinghouses

Payers

Interfacing

Cross Walking

Electronic

Health

Records

Departments

Leadership

Awareness

Policy Updates

Impact Assessments

Third Party Partners

ICD-10 Timeline…

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Source: Ingenix

Now 2015

Important ICD-10 Compliance Dates....

Source:: Refer to Centers for Medicare and Medicaid Services (CMS); Information on 5010 / D.0 for exact wording. http://www1.cms.gov/ElectronicBillingEDITrans/18_5010D0.asp

Level 1 Compliance: Complete by December 31, 2010

You can create and receive compliant transactions and can process them WITHIN YOUR OWN SYSTEMS.

Level 2 Compliance: Complete by December 31, 2011

You have completed end-to-end testing with each of your trading partners, and

are able to completely process transactions with the new versions of the standards.

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Level 3 Compliance: Complete by October 2015

Must by 100% ICD-10 compliant or utilize a cross walking tool.

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WHERE TO START …..

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1. Leadership Awareness

2. Project Governance

3. Staff Education

4. Communication

5. Develop a plan

5 Critical Success Factors

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At a high level...

both HIPAA 5010 and ICD-10 appear to be on track....

The Vendor Level…•Communicating•Clearinghouses•Tools & Solutions•Testing

At the Industry level…•Documentation•Standards•Policies

But How Does all This Impact YOURPractice….

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In Reality …

HIPAA 5010 and ICD-10 impact the following...

• Processes

• People

• Technology

• Operations

Registration

•ABNs

•Medical Necessity Rules

Billing Software Functionality

•Encoding tools

•Compliance

•Training Staff

Billing

•Financial Systems

•Billing System

•Claims Submission

•Scrubbing tools

•Editing tool

•Clearinghouse

•Tracking and Reporting

Administration

•Compliance

•Risk managements

•Staff Training

The Internal Impact... Reporting

•Disease Management Registries

•Utilization Tracking

•Compliance

•Manage Care

•HEDIS

•Provider productivity

Clinical Information Systems

•EHR

•PACS

•eRX

•LIS

•Interfacing

•Supply chain

IT infrastructure

•Software Upgrades

•Hardware Upgrades

•Testing

•Gap Solutions

•Etc…

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Your external trading partners and /or vendors must also comply

• Insurance companies

• EDI Vendors / Clearinghouse providers

• Billing Companies

• EHR / PM Vendors

• Coding Vendors

• Scrubbing Tools

• Hardware

• Auditing tools

External Impact...

The Technical Side of ICD-10:Cutting Through the Noise, Hype and Myths

• This is NOT exclusive to just the I.T. dept.

• Every IT system in the institution needs to be part of the ICD10 assessment

• Any and all systems that captures, shares and stores codes and/or interfaces with accounting/billing/EHR/CPOE/LIS/RIS/RX are potentially

affected.

Tech Side of ICD-10

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Systems Potentially Impacted…

Financial

Billing Systems

Financial Systems

Claims Submission

Scrubbing Software

Determinations

Reporting

Provider Profiling

Quality Mgt.

Disease Mgt.

Registries

State Reporting

Fraud Mgt.

Patient Assessment

Data sets

Aggregate Data

Managed Care

Hospital IS

DRG Grouper

Encoding Software

Abstracting Systems

Compliance

Medical Necessity

Registration

Scheduling

ABNs

Medical Necessity

Support Systems

Case Mix

Utilization Mgt.

Quality Mgt.

Case Mgt.

Performance Mgt.

Clinical Systems

Clinical Protocols

Ordering

Reminders

Disease Mgt.

CPOE

EHR

LIS

PACE

EKG

Tech Side of ICD-10

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What to consider...

•Conduct an Assessment to determine the current state of effort applied toward achieving compliance for both HIPAA 5010 & ICD-10.

•Identify any gaps (i.e. Gap Analysis) that exist including, but not limited to:

o Workflow, process, policy, and technology considerations

o Readiness level

o All related projects

o Resource Allocation

o Contingency considerations, etc.

•Starting having discussions and meetings with all your vendors and trading partners

•Identify documents needing updating (Charge slips, superbills, policies, training manuals, etc...)

•Develop a contingency plan

Completing an Impact Assessment

• ICD-10 goes beyond just coding policy changes

• The technical side will be significant

• Must allow time for testing and validation prior to the deadline

• Start discussions now with all your vendors/suppliers

• Get promises in writing

• Complete an impact assessment

• Leverage knowledge sharing within your trade association

Summary

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Resources

• Coker Group – http://www.cokergroup.com

• AHIMA – http://www.ahima.org/icd10

• AAPC – http://www.aapc.com/ICD-10

• CMS – http://www.cms.gov/ICD10

• WHO – http://www.who.int/classifications/icd

• CDC – http://www.cdc.gov/nchs/icd.htm

• AMA – http://www.ama-assn.org

• HealthSystems – http://www.healthsystems.net

– Email upgrades @ healthsystems.net