Priority List for ICD-10 Readiness

Judy Monestime, MBA, CDIP, CPCAnita Archer, CPCNow that 2014 is here and with less than a year to go, there are no indications that CMS will be postponing the scheduled Oct. 1, 2014 ICD-10 go live. Medical facilities must focus on making their ICD-10 implementation strategy a top priority. The vast majority of healthcare providers expect to encounter a wide range of barriers to the ICD-10 implementation within the first six months of the compliance deadline, which will prevent them from fully realizing the potential benefits and improvements until the second quarter of 2015; therefore, planning and budgeting for all aspects of the conversion process in order to diminish the economic and operational impact is paramount.

According to recent findings KPMG published this year, "organizations are largely unprepared for ICD-10 implementation.” This conclusion supports WEDIs recent survey that 80 percent of healthcare providers will fail to complete their business changes and begin testing before 2014.

In an effort to ensure that your facility will be ready in time, listed below are best practice methods to assure key operational milestones are achieved and maintained during the last 8 months of your ICD-10 preparatory journey.

Assess ICD-10 Training Needs

Training will be one of the critical areas impacted by the adoption of ICD-10. Validate and re-assess scale and scope and customize the educational plan to meet the needs of a diverse workforce during and following the transition. Place emphasis on “role-based training,” as opposed to one-size fits all solution. Healthcare practices will need to work with a vendor that will classify the roles into different subgroups. There must be consensus as to the extent of training that needs to be done, who (what roles) needs to be trained, what level of training is needed and how training will be delivered. Different levels of training will need to be based on the impact of ICD-10 on roles and functions.

Conduct Clinical Documentation Readiness

Establish a clinical documentation program, internal communications operations and physician champions to train and engage the organization’s medical staff in ICD-10. Perform a code level analysis on the selected 50 records of those ICD-9-CM codes that have more than one possible ICD-10 code to assess the accuracy of ICD-10 code and the accuracy of clinical documentation to support the specificity of the potential ICD-10 codes.

Continue to strengthen the physician engagement and alignment approaches through peer-to-peer documentation champions, the clinical documentation improvement program's educational strategies, and department-level education. Appoint a physician champion that participates on the ICD-10 governance committee and potentially on the physician engagement team.

Develop Dual Coding Strategy

Staff productivity will decrease by 30 to 50 percent as coders and clinicians get up to speed on the new code set.  A baseline gap analysis helps answer these important questions and exposes actual coding and case mix index (CMI) impacts based on existing coder knowledge and clinical documentation. A baseline gap analysis provides important data for benchmarking, targeted reviews and targeted education. A dual coding program can address organizational business goals such as the ability to rework managed care contracts, identify glitches in billing workflow and avoid unnecessarily missed reimbursement opportunities before Oct. 1, 2014. Your chosen method for dual coding, concurrent or retrospective, drives cost calculations. Other factors include the types of accounts to be dual coded, volumes of accounts for dual coding and how much information will be collected, analyzed and integrated into other initiatives, such as testing preparedness.

Assess Vendor & Payer Readiness

In the review of previous CMS regulatory initiatives, for example, v5010, there has never been 100 percent compliance. After Oct. 1, 2014, there will be coding errors, reimbursement errors and some providers and payers that are not ready for the ICD-10 cutover. Your organization should consider the following steps:

  • Create an inventory of your external trading partners, sorting by annual dollar volume (high to low).
  • Reach out to your trading partners and schedule a test of healthcare transactions (837 and 835 transactions) using claims with ICD-10 codes.
  • Take appropriate measures to insulate your organization by preparing for dual processing and dual coding contingency strategies.
  • Continue to have conversations with your vendors to refine your organization’s transition risks.  Many are concerned as to whether Medicaid and Medicare will be ready.


Conduct ICD-10 Testing

It is recommended that providers plan several phases and levels of testing for ICD-10 prior to implementation, and verify the accuracy in documentation and coding in order to ensure payment of claims. Before you begin testing, identify testing workflows and scenarios for your practice that apply use cases, test cases, test reports and test data.

Identify when your practice will be able to run test claims using ICD-10.

Develop a project plan that recognizes dependencies on tasks and resources. The plan should prioritize and sequence efforts to support critical paths:

Functional (i.e.: unit) testing: Verify that ICD-10 updates meet the requirements of each individual component in a system.

System testing: Verify that an integrated system meets requirements for the ICD-10 transition. After completing unit testing, providers will need to integrate related components and ensure that ICD-10 functionality produces the desired results.

Regression testing: Focus on identifying potential unintended consequences of ICD-10 changes. Test modified system components to ensure that ICD-10 changes do not cause faults in other system functionality.

End-to-End testing: Work with various organizations and vendors outside your medical practice:

Coordinate directly with your vendors as necessary to support testing execution and issue resolution.

Payers are critical to the financial viability of the practice. Denials or payment delays may result in a substantial decline in revenues or cash flow. Payers may struggle with the ICD-10 transition due to the significant system changes needed to support policies, benefit/coverage rules, risk analysis, operations and other critical business functions impacted by this change. Payer testing should identify and resolve any issues prior to go-live.

Development of a thorough testing strategy and partnerships with payers around testing is crucial and can be challenging. The development of scenarios for functional, integration and end-to-end testing with payers is key.

Review Revenue Cycle/Financial Risk of ICD-10 Transition
The number increase from ICD-9 to ICD-10 lends itself to a more complex reporting system. This will change the providers charge masters creating many fee changes that will most likely create billing confusions as reimbursement will likely be different from expected.

Establish current RCM performance baseline benchmarks for metric comparison for ICD-10 code set by monitoring, re-defining and measuring the key performance indicators (KPIs) for operational success following the transition including:

  • DRG-based reimbursement
  • Managed care contract revision
  • Adjudication rules

The potential revenue risks include denials and payment errors and could potentially result in a negative revenue impact.

Archer, Anita & Monestime, Judy (2013, September 17).  ICD-10 Documentation for State Medicaid Agencies (SMA) Health Conditions Categories. HIMSS. Retrieved from http://www.himss.org

Letourneau, Rene (2013, December 16). ICD-10: Minimizing the Financial Hit. HealthLeaders Media. Retrieved from http://www.healthleadersmedia.com/

Managing external risks associated with the ICD-10 transition. Health Management Technology.  Retrieved from http://www.healthmgttech.com/

McCann, Erin (2013, December 19). Outlook grim for docs' ICD-10 readiness. Healthcare IT News. Retrieved from http://www.healthcareitnews.com

Monestime, Judy (2012, June). Role Based Training for Your ICD-10 Conversion. HIMSS. Retrieved from http://www.himss.org

Natale, Carl (2013, April 08). ICD-10 Testing Scenarios: What medical practices need to know. ICD10 Watch. Retrieved from http://www.icd10watch.com

Stewart, Elizabeth & Carr, Kim. Dual Coding: Show Me the Money! ICD10monitior. Retrieved from http://icd10monitor.com/

(2013, December 17). Survey Results Indicate Healthcare Industry is Behind the Curve on ICD-10 Compliance Readiness. Wedi. Retrieved from  http://www.wedi.org

Anita Archer, CPC, is a Director of Regulatory Compliance at Hayes Management Consulting. She is a Certified Coder and AHIMA Approved ICD-10 CM/PCS trainer. Anita has more than 30 years of experience in the healthcare industry is focused on revenue cycle optimization, ICD-10 preparedness and business process improvement.

Judy Monestime, MBA, CDIP, CPC, is the Vice President of ICD-10 at The CODESMART™ Group. She is a Certified Professional Coder and AHIMA Approved ICD-10 CM/PCS trainer. Judy is a well-recognized consultant, keynote speaker, and author. Her background is in revenue cycle, with a focus on clinical documentation, coding, and denial management. She has led several ICD-10 assessment and implementation projects for providers and payers, including evaluating both the business and technical processes and systems for key potential impacts of ICD-10 and confirming ICD-10 impacts by process area.

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