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Healthcare Consultant Reveals “The Fallacy of ICD-10”

July 21, 2015
by Rajiv Leventhal
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In early July, when the Centers for Medicare & Medicaid Services (CMS) announced a joint effort with the American Medical Association (AMA) to help physicians get ready ahead of the Oct. 1 deadline, many in the health IT industry saw it as a compromise of sorts between the physician community and the feds.

After all, at the core of that announcement is flexibility in the claims auditing and quality reporting process as the medical community gains experience using the new ICD- 10 code set. Specifically, CMS said that for the first 12 months post-transition, they will not deny or audit physician or other practitioner claims solely on the specificity of the ICD-10 diagnosis code as long as the physician/practitioner used a valid code from the right family.

According to Bruce Hallowell, managing director in the Chicago-based consulting firm Navigant’s healthcare practice, this was the telltale sign that there wouldn’t be another ICD-10 delay. “Despite three previous delays all evidence suggests that the ICD-10 transition will occur on October 1, 2015,” Hallowell wrote in a “Pulse Alert” paper for Navigant’s website. “At that time, all entities covered by the Health Insurance Portability and Accountability Act (HIPAA) of 1996 must cease using ICD-9 to document patient diagnoses and inpatient procedures. Only claims using ICD-10 will be accepted,” he said in the paper.

Hallowell recently spoke with HCI Senior Editor Rajiv Leventhal about the CMS announcement, organizations’ preparedness level, what people are missing when it comes to ICD-10, and more. Below are excerpts of that discussion between Leventhal and Hallowell.

What were your thoughts when CMS announced a grace period regarding specific ICD-10 claims? Did you see it as a concession on their part?

It was a response to these legislations that you’re seeing; CMS wanted to stop people from continuing to [introduce] those. Commercial payers might not do what CMS did, however. I’m not surprised by this grace period, as it gives people the ability to do dual coding. CMS can say that they will let you dual code, but all payers might not agree with that. Blue Cross might say no, we won’t process it. That could get interesting then.

Bruce Hallowell

Were you ever of the belief that there would be another delay?

 At one point I thought they might have delayed ICD-10 again, but if you do that, next year is an election year, so it won’t go through, meaning it would be over for a while. People are pushing for a delay still; physician groups are not sure about this. The last delay got hid in a physician bill, but we got past that. My belief is that they cannot delay it again because part of ICD-10 gives us the ability to measure for meaningful use, and we’re after that ability to measure between hospital claims and physician claims. You can’t do it today, it’s virtually impossible. They need that for the savings, but can’t achieve that until they get some compliance for the two types of billing.

So realistically, it’s too late in the game. CMS did this to relieve people, and it’s a great announcement, but it’s just one piece. You heard the announcement from CMS, but not from anyone else like Medicaid or Champus. When CMS goes one way, they usually follow, but they may not.  They are being very quiet right now. You’d think they would do it all together. If they don’t, providers will be forced to go to dual coding anyway.

The problem is that the insurance companies have made the investment to change their systems, so it costs them more money to run a dual system. But they already made an investment, so why would they not want to take advantage of the savings? ICD-10 has been delayed twice. Most providers are not ready since they thought it would be delayed again, so they’re scampering right now. But if we do this dual coding, we’ll still let them scamper.

Do you think organizations are prepared enough?

They prepared a lot to begin with, but the issue comes down to a simple fallacy of ICD-10—everyone is concerned with going from 16,000 codes to 144,000 codes and the new coding structure, but the extra codes aren’t really the problem. The ability to code the record is the issue, and organizations haven’t dealt with that. You have all this money spent with meaningful use and EHRs that built these automation tricks, but all the order sets and protocols attached to them were all built on ICD-9. So you have to train all these coders and modify the system, but if they don’t go back and fix those issues, it won’t make a difference—they won’t be able to code them all. Specificity in the record is what will cause the problem, not the code itself.  Clinical documentation improvement (CDI) is key for that. They need to go back and review their order sets, and review their physician and clinical documentations and make sure it’s at that level of specificity.

Do people you connect with see ICD-10 as a good thing for healthcare?