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Preparation for Medical Coding Change Should Begin Now!

Butcher, Lola

doi: 10.1097/01.COT.0000389878.75218.e8
Coding Change

Coding Change

The only medical coding system many oncologists have ever used is about to be replaced by the coding system used in the rest of the developed world. The change will not occur until 2013, but the time to start preparing is now.

To accommodate the new coding system, physician practices must upgrade to Version 5010 standards for electronic health transactions, such as submitting claims to insurance companies and the Medicare program. The 5010 standards will require new software, and the first compliance date for upgrading from the current Version 4010 standards to Version 5010 is Jan. 1, 2011.

That is when the Centers for Medicare & Medicaid Services wants physicians practices and insurers to start testing whether they can successfully transmit electronic claims using the Version 5010 standards. Throughout 2011, the Medicare program will accept claims submitted using either Version 4010 or Version 5010.

On Jan. 1, 2012, that flexibility ends.

“If providers do not conduct electronic health transactions using Version 5010 as of January 1, 2012, delays in claim reimbursement may result,” CMS warns on its website. “The compliance dates are firm and not subject to change. If you are not ready, your claims will not be paid.”

If that fast-approaching deadline takes you by surprise, you are not alone.

“It is almost becoming a joke because nobody is paying attention,” said Deborah Grider, President of the American Academy of Professional Coders. “Many physicians are burying their heads in the sand.”

Dawn Holcombe, MBA, President of DGH Consulting, an oncology consulting firm in Connecticut, says many practices, hard hit with declining revenues and rising expenses, are struggling to simply survive and have trouble focusing on another time-consuming challenge that looms in the future.

Furthermore, some oncologists find the idea of implementing a new International Classification of Diseases (ICD) coding systems irksome because it may mean an expense and a disruption that does not benefit physician practices or the patients they serve.

“A lot of people say, ‘It doesn't do us any good in oncology,’” said Ms. Holcombe, also Executive Director of the Connecticut Oncology Association. “But it is the standard for health care pretty much around the world so we are playing catch-up. We have to do it.”

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What is Happening

As medical knowledge has expanded, the current coding system used in America—ICD-9-CM—has run out of capacity. It is being replaced with ICD-10 CM/PCS, which consists of two parts:

  • ICD-10-CM for diagnosis coding, developed by the CDC for use in all US health care settings.
  • ICD-10-PCS for inpatient procedure coding, developed by CMS for use in US inpatient hospital settings only.

ICD-10-CM codes, which allow for more clinical detail and specificity than the current codes, use updated terminology and disease classification that are consistent with current clinical practice. CMS says the new codes will help with all sorts of things, from measuring the quality and safety of care to setting health policy and preventing health care fraud and abuse.

The World Health Organization endorsed ICD-10 in 1990, and most other developed countries have already adopted it. (ICD-10-CM is a US clinical modification of ICD-10.) But, despite its enthusiasm, CMS has repeatedly delayed implementation in the United Sates, citing the difficulty of moving the entire health care industry to a new coding system.

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69,000 Codes vs 14,000

ICD-10-CM includes about 69,000 codes, compared with 14,000 in ICD-9-CM. But learning the new codes should not pose much problem, especially in oncology, says Kathy DeVault, Manager of Professional Practice Resources for the American Health Information Management Association.

For one thing, most oncology practices use a small subset of codes. For another, the coding changes for oncology are mostly straightforward, compared with some other specialties.

But upgrading the technological infrastructure needed to accommodate the new codes presents a major challenge.

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3-7 Digits vs 3-5; 7 vs 3 or 4

That is primarily because diagnosis coding under ICD-10-CM uses three to seven digits instead of the three to five digits used in the ICD-9-CM system. Meanwhile, the ICD-10-PCS uses seven alphanumeric digits instead of the three or four numeric digits used in ICD-9-CM procedure coding.

Version 4010 standards cannot accommodate the expanded codes, which means that every payer, physician, hospital, and ancillary provider in America must upgrade to the new standards so they can transmit claims data electronically.

For some practices, moving to Version 5010 standards will be as simple as getting a software upgrade from their practice management system vendor, through their maintenance agreement, although there may be a charge. For other practices, however, medical codes are embedded in many aspects of their operations, requiring many components of their practice, such as electronic health record technology and quality reporting systems, to be upgraded as well. That is why CMS wants all providers and payers to start external testing of their ability to use Version 5010 standards soon.

“Now is the time to start talking to vendors and find out what their plans are for moving to ICD-10,” said Sue Bowman, AHIMA's Director of Coding Policy and Compliance.

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What to Do Now

Oncologists or their practice managers should take several other steps soon to be prepared for ICD-10 success. Those include:

  • Identifying the current practice elements, such as electronic health record systems, contracts, quality reporting protocols and superbills, that use ICD-9 codes. “They should basically be doing a complete analysis of all of their workflow and processes within their practice that would be affected by the transition,” Ms. Bowman said. Knowing that is the first step to developing a work plan and budget for preparing for ICD-10 implementation.
  • Contacting clearinghouses, payers, billing services, and other entities with which they conduct business. Find out when they will be ready to test their systems for Version 5010 and ICD-10 compliance.
  • Meeting with payers to find out whether ICD-10 codes will affect contracts. Because the new coding system offers more specific details, payers may plan to modify terms of their contracts or their reimbursement rates.
  • Identifying changes to processes, such as clinical documentation and quality reporting, that will need to be made when ICD-10 is implemented.
  • Determining which physicians and staff members need to be trained on the new codes. Even oncologists who do not do their own coding need to understand the new coding system because they must provide the greater level of documentation that coders will need to determine the right codes. “Some physicians just write down on their super bill what the diagnosis is, and it's very vague,” Ms. Grider said. “They are going to have to document differently, not from a clinical judgment standpoint, but strictly from a coding standpoint.”
  • Making a budget for ICD-10 implementation, including the costs of software updates, reprinting superbills, training and loss of productivity while staff are being trained.
  • Conducting test transactions using Version 5010 standards with payers and clearinghouses.
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Where to Get Help

The starting point for information about ICD-10-CM/PCS coding system is on the CMS website:

Check out the links for:

  • ICD-10 and Version 5010 Compliance Timelines
  • Provider Resources

The site also includes a link to the official ICD-9-CM and ICD-10-CM guidelines, a resource that some medical coders are unaware of, notes Kathy DeVault, Manager of Professional Practice Resources for the American Health Information Management Association.

“Sometimes I meet people who have been hired as a biller, and then someone hands them a coding book and says, ‘Oh, by the way, you've got to put these codes on here in order to do the bill.’ They are doing the best they can with the tools that they have, but they don't know all the resources that are available to them.”

© 2010 Lippincott Williams & Wilkins, Inc.
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