Survey: Healthcare Organizations Largely Unprepared for ICD-10 Implementation | Healthcare Informatics Magazine | Health IT | Information Technology Skip to content Skip to navigation

Survey: Healthcare Organizations Largely Unprepared for ICD-10 Implementation

January 8, 2014
by Rajiv Leventhal
| Reprints

With ICD-10 implementation less than 10 months away, health plans and providers haven't fully determined how the new coding standards will affect their businesses, according to a recent poll conducted by KPMG, the N.Y.-based audit, tax and advisory firm.

The KPMG poll, conducted from October to December of 2013, found that while the majority of payer and provider respondents acknowledged that they had completed an ICD-10 impact assessment (76 percent) and had allocated budget toward readiness efforts (72 percent), they were significantly deficient in preparing for key aspects of implementation. Comprehensive system testing, determination of impact on cash flow, and revenue cycles were where the majority of respondents revealed that their respective organizations had not properly addressed the impact of ICD-10 implementation.

"As October 1st inches closer, healthcare organizations have their work cut out to properly absorb the impact that the new coding will have on their businesses," Wayne Cafran, an advisory principal in KPMG's healthcare and life sciences practice, said in a statement. "A full 50 percent stated that they had yet to estimate the new coding systems impact on their cash flow. With estimates by those who did measure the impact tallying anywhere from $1 million to more than $15 million, healthcare organizations are in for a rude awakening when they finally realize what the new standards will have on their bottom lines."

Nonetheless, healthcare providers and health plans will spend the early part of 2014 ensuring that their coding systems are properly functioning by October 1st. Forty-two percent of respondents indicated that they have recently undergone system testing, which, according to the Centers of Medicaid and Medicare Services (CMS), includes working with practice management system and outside vendors to develop and test processes and systems using ICD-10 codes, creating a comprehensive test scheduling plan, and working with health plans and billing clearinghouses.

In terms of more comprehensive testing, one-third of respondents indicated that they are currently conducting end-to-end testing. More than one-quarter (28 percent) stated that they plan on conducting end-to-end ICD-10 compliance testing, while three percent stated that they would not.

"Nearly three-quarters (74 percent) of respondents said that they have yet to or are not planning on conducting testing that involves external entities, such as health plans, providers and trading entities," said Cafran. "This proves somewhat problematic when you consider the importance of ensuring that the process will function smoothly on day one. The recent roll out of the Affordable Care Act from a technical aspect should give health plans and providers all the motivation they need in determining just how important it is to put the new system through its paces."

A survey published in December by the Workgroup for Electronic Data Interchange (WEDI) revealed that despite the impending deadline, the healthcare industry isn’t ready. According to that survey, 80 percent of providers will not complete their business changes and begin testing before 2014. Additionally, more than 20 percent of vendors said they were half-way or less than half-way complete with product development in support of ICD-10, and 40 percent said they would not have products available to customers until 2014. One-third of payers were planning to test externally by the end of 2013, down from one-half in the February 2013 survey.

Get the latest information on ICD10 and attend other valuable sessions at this two-day Summit providing healthcare leaders with educational content, insightful debate and dialogue on the future of healthcare and technology.

Learn More

Topics

News

Community Data Sharing: Eight Recommendations From San Diego

A learning guide focuses on San Diego’s experience in building a community health information exchange and the realities of embarking on a broad community collaboration to achieve better data sharing.

HealthlinkNY’s Galanis to Step Down as CEO

Christina Galanis, who has served as president and CEO of HealthlinkNY for the past 13 years, will leave her position at the end of the year.

Email-Related Cyber Attacks a Top Concern for Providers

U.S. healthcare providers overwhelmingly rank email as the top source of a potential data breach, according to new research from email and data security company Mimecast and conducted by HIMSS Analytics.

Former Health IT Head in San Diego County Charged with Defrauding Provider out of $800K

The ex-health IT director at North County Health Services, a San Diego County-based healthcare service provider, has been charged with spearheading fraudulent operations that cost the organization $800,000.

Allscripts Touts 1 Billion API Shares in 2017

Officials from Chicago-based health IT vendor Allscripts have attested that the company has reached a new milestone— one billion application programming interface (API) data exchange transactions in 2017.

Dignity Health, CHI Merging to Form New Catholic Health System

Catholic Health Initiatives (CHI), based in Englewood, Colorado, and San Francisco-based Dignity Health officially announced they are merging and have signed a definitive agreement to combine ministries and create a new, nonprofit Catholic health system.