Be Prepared for the New ICD-10 Reimbursement Coding Standard

by John W. Kaveney

On October 1, 2014 the reimbursement process for the United States health care system will become significantly more complicated. On this date, a new system for recording injuries, medical diagnoses, and inpatient procedures will go into effect. It is known as ICD-10, the 10th version of the International Classification of Diseases created by the World Health Organization.

Of particular concern to the industry is the explosion of the number of codes from 17,000 under the current system to approximately 155,000 under ICD-10. As a consequence, the pressure and stress on already strained health care professionals and their staffs to properly code a particular service will only increase. This means the new system must be implemented and learned by the deadline or providers risk losing reimbursement due to coding errors. And, with the explosion of new codes, many in the health care industry fear there will be a significant learning curve when diagnoses in ICD-10 have exploded to include every conceivable iteration of an injury or disease. For example, in ICD-9 there were nine codes for bites while under ICD-10 there are over 300. Proponents of the new standard argue that there is a systematic approach and hierarchy to the coding which makes it easy to navigate. They also argue that such a system is beneficial because it provides a greater level of detail for predictive analytics, which every business can utilize to better assess its services and improve quality and performance. Many in the industry appear skeptical that this will be the case. Regardless, the health care system will have to become familiar with the following, which are only a sampling of the entertaining and frankly absurd examples of coding specificity in ICD-10:

  • V9733XA – sucked into jet engine, initial encounter;
  • V80731A – occupant of animal-drawn vehicle injured in collision with streetcar, initial encounter;
  • V9027XA – drowning and submersion due to falling or jumping from burning water-skis, initial encounter;
  • T71232A – asphyxiation due to being trapped in a (discarded) refrigerator, intentional self-harm, initial encounter; and
  • T63813A – toxic effect of contact with venomous frog, assault, initial encounter.

Aside from the complexity of the new system, what is also alarming is the fact that until recently, despite the numerous setbacks and embarrassments from implementation of the Affordable Care Act and HealthCare,gov, the Center for Medicare and Medicaid Services (CMS) had no plans to conduct end-to-end testing of the system before the October launch date. A February 18, 2014 letter from four Republican senators to the CMS administrator, which urged testing, finally resulted in CMS announcing it would offer limited end-to-end testing sometime in the summer of 2014 with details to be disseminated at a later time. It remains to be seen if the testing will actually occur or how robust it will be to prepare the system for this major change.

While the deadline for implementation has already been delayed twice, CMS has issued stern warnings to the industry that the current October 1, 2014 deadline is a firm deadline. As a result, the health care system is trying to figure out how to go about implementing and preparing for the changes. As of 2008, a study by the health care IT firm Nachimson Advisors warned that estimated total costs for implementation would be $83,290 for a small practice (3 physicians and 2 administrative staffers), $285,195 for a medium practice (10 providers, 1 professional coder, and 6 administrative staffers), and $2.7 million for a large practice (100 providers, 10 full-time coding staffers, and 54 medical records staffers).

The American Medical Association, an opponent of the ICD-10 implementation, has a significant amount of literature on its website regarding challenges to the adoption of the standard as well as recommended action for providers to prepare for the October 1, 2014 deadline. The materials can be found here.