This document discusses the key challenges providers face in transitioning from ICD-9 to ICD-10 coding standards. It identifies increased documentation specificity, reduced coding productivity, impacts to reimbursement methods, and ensuring vendor and system readiness as major challenges. Mitigation strategies discussed include clinician education, dual coding, leveraging automated coding tools, testing reimbursement impacts and collaborating closely with vendors on remediation timelines.

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ICD-10 Remediation for Provider practices – Key Challenges and
Mitigation Strategies
Clinical Documentation Improvement
Published on : July12, 2013 Email Print Return
On October 1, 2014, the U.S. healthcare system will transition from the Ninth Edition of the International
Classification of Diseases (ICD-9) set of diagnosis and inpatient procedure codes to the Tenth Edition of
those code sets (ICD-10). ICD-10 compliance will require HIPAA-covered entities including provider practices
use ICD-10 codes for healthcare services provided on or after October 1, 2014. ICD-10 codes greatlyincrease
the detail of the current coding system – the existing 17,000 codes are now over 150,000 ICD-10 diagnosis
and procedure codes.
Provider systems are impacted across the value chain due to ICD-10 remediation and significant changes are
required across the value chain and provider business functions. Providers’ adoption of HIPAAtransaction
standards (5010) and the ICD-10 code sets will result in significant potential costs to provider practices.
According to a studybyNachimson advisors, the cost impact on providers for ICD-10 remediation could range
from $83,000 to $2.7 million per practice based on the size of practice.
This article focuses on the key challenges being faced by providers in their ICD-10 remediation journey and
the mitigation approaches that providers can adopt to address them.
The medical record is a critical source of information containing details around the patient’s medical history,
diagnosis, procedures and treatment details. Significant code count increases due to the ICD-10
implementation will necessitate higher specificityand granularityin the medical records. The higher degree of
specificity in documentation needed to code accurately will have a direct correlation to reimbursement and
compliance. Inaccurate clinical documentation will have a cascading effect on the quality of medical coding
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2. Coding Productivity
Impact on Reimbursements
Vendor Readiness
IT Systems remediation and End-to-End Testing
performed bythe coders due to a lack of details in the documentation.
Provider practices will need to focus on early clinician education specific to the documentation guidelines to
ensure the details required for efficient coding are appropriately documented. Providers could also
understand the clinical areas influenced byICD-10 remediation for their practice and focus their energies on
these key areas during training. Providers can also explore the option of leveraging tools, which provide
guidelines and edits during concurrent chart review.
Coding productivity will most likely be lower after the ICD-10 transition. Coders may not be able to code at
same efficiencywhile theyare working with ICD-10 codes compared to ICD-9 codes. The increased number
of ICD-10 codes and increased specificitycomplicate the task for coders. If the implementation lessons from
Canada are anyindication, the coding productivitymayreduce by30-50 percent with the new codes. Improper
coding may lead to other issues such as increased claim denial which will adversely impact provider
financials. Payment error rates are expected to rise to as high as 10 percent as well.
Provider practices may consider approaches such as dual coding and adoption of automated tools such as
CACs (computer assisted coding) to mitigate the risks around coding productivity losses and ensure better
preparedness.
Dual coding refers to the coding of both ICD-9 CM/PCSand ICD-10 CM/PCScodes on the same patient health
record. Providers would have to incur an initial loss of productivity during implementation of the dual coding
process. However, a properlyexecuted dual coding strategywill help tide over coding challenges specific to an
organization’s ICD-10 transition program. Besides providing much needed practice to coders for ICD-10
coding, dual coding will also help providers understand how their revenue will be affected post transition.
Post compliance date, there are chances that entities will not be readyto process ICD-10 codes. There would
also be scenarios around services provided to patient before and after October 01, 2014 and providers would
need to submit split claims - claim with ICD-9 codes for services rendered before October 01 and claim with
ICD-10 codes for services rendered after October 01, 2014. Providers and their vendor partners will need to be
prepared to support these claims and coders will be required to code in both ICD-9 and ICD-10 codes.
Given the enormityof the challenge, effectivelyleveraging automated tools will be critical to accelerate coding
and improve accuracyof claims. CAC related tools mayhelp providers to reduce the manual processing and
automate the selection of these codes.
Providers use ICD-10 codes for diagnosis and inpatient procedures. The various reimbursement methods
that are based on ICD-9 (and subsequentlyon ICD-10 codes) will be impacted post ICD-10 compliance date.
Provider reimbursement would be impacted due to updates to reimbursement methods to support ICD-10
codes as well as anypossible errors in coding in line with new coding systems.
DRGs (diagnostic-related groups) based reimbursement method is used for inpatient claims reimbursement.
DRGs use ICD diagnosis and procedure coding for DRG classification. Changes in primary diagnosis with
ICD-10 codes may result in shift in MS-DRG values, this shift in DRG may lead to variance in provider
payments.
Providers will need to test to ensure that the financial variance in their payments for claims using DRGs will be
within acceptable range. Provider practices will need to perform financial neutrality testing with claims
identified based on criticality (high dollar value, high frequency, DRG shift etc.) to validate the variance in
payments and ensure reimbursements are not adversely impacted. In case payers are not available for
partner testing, providers could explore the option of leveraging COTS products helping with analysis of DRG
variation and payment range variation from ICD-9 to ICD-10 claims.
One of the key provider focus areas for the provider ICD-10 transition program involves collaboration with
vendors to ensure ICD-10 compliance of vendor products by agreed upon timelines and ensuring vendor
support to provider ICD-10 end-to-end testing. Providers will also need to work with vendors to facilitate
trainings for staff specific to remediated features of these products.
Provider practices’, as a result of the ICD-10 program, will be adversely impacted if remediated vendor
products are not ready on time to support internal testing and external testing with payers and other trading
partners for validation of end-to-end business flows, clinical, financial and reporting processes.
Provider practices should share their remediation plan with vendors ahead of the time and obtain the
commitment from vendors for availability of remediated product and support for provider testing and training
programs. Timelymilestones to assess vendor progress would help in mitigating the risk and allow providers
to plan for alternatives in case the vendor remediation program is not progressing as per mutually agreed
timelines.
Apart from addressing training related aspects to support clinical documentation and coding improvement,
providers will need to make sure that effective system remediation and end-to-end testing with internal and
external systems is performed to address the IT and business requirements, and ensure that financial
variance in payments is within acceptable range.
The remediation and testing efforts need to focus on comprehensive assessments to identifyimpacted areas
such as patient admission, patient care, clinical documentation, clinical coding, billing and define the
approach for remediation. Given the fact that provider partners also will be completing remediation for their
systems, providers will need to meticulously collaborate and perform test planning activities to ensure
partners’ system remediation and participation in provider testing and accomplish smooth remediation.
Performing end-to-end testing with internal systems, vendor products, partners including payers,
clearinghouses and other trading partners is a critical success factor in validating all the impacted EDI
transactions (270/271, 276/277,278, 837, 835) reports specific to various business scenarios ensuring
provider ICD-10 remediation. During, employing dual coding byusing real medical records in ICD-9 and ICD-
10 codes will help providers to test for business scenarios and identify issues specific to variance in
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3. About The Authors
reimbursements. Providers may also consider COTS products available in a market, which may help to
simulate the payments and continue with the testing effort.
The recent MGMAresearch indicates that provider readiness to meet the ICD-10 compliance date continues to
be slow with only 4.8 percent of practices reporting significant progress. Lack of communication between
provider practices and their trading partners regarding software updates and necessary testing support is
identified as one of the keyfactors behind the delayin remediation effort. Provider practices have an uphill fight
ahead to ensure ICD-10 remediation with key external stakeholders in time to safeguard their practice from
operational and financial disruption after the ICD-10 compliance date.
Harika Allada works as Senior Business Analyst in the Healthcare IT field with one of the
largest health insurance companies in U.S. and possesses more than 8 years of
experience. Her areas of interest include healthcare reform, health information networks
and ICD-10 implementation. Harika is certified Business Analyst Professional (CBAP) and
Fellow, Academy of Healthcare Management (FAHM) and can be reached
at harika.allada@gmail.com
Apoorv Surkunte works as Manager with a leading consulting and IT services firm in the
healthcare IT area. Apoorv has over 8 years of experience in Healthcare IT. His areas of
interest include healthcare refrom, healthcare exchanges and healthcare innovations.
Apoorv is a certified Fellow, Academy of Healthcare Management (FAHM) and Certified
Project Management Professional (PMP). Apoorv can be reached
at Apoorv.surkunte@gmail.com
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