ICD-10: READY OR NOT, HERE IT COMES

The plan was approved. The date is set. On August 18, 2008, the Department of Health and Human Services announced the proposal of a regulation that would replace the current, outdated coding system known as ICD-9-CM, (the International Classification of Diseases, 9th Revision, Clinical Modification). On January 16, 2009 the final ruling posted that a transition to the next generation of codes, ICD-10-CM, would take effect on October 1, 2013.

While ICD-10-CM adoption will require major overhauls here in the U.S., it is not new to the rest of the world. The World Health Organization (WHO) adopted the 10th revision of the coding system in 1990 and published it in 1994. The familiar three- to five-digit ICD-9 codes will be replaced by more complex alphanumeric system, for increased accuracy and expandability. According to the U.S. Department of Health & Human Services, ICD-9-CM includes about 17,000 codes and is expected to start running out of available codes this year.3 ICD-10-CM will include some 65,000 codes, with the capacity for more than 155,000 codes.

According to HHS Secretary Mike Leavitt, “The greatly expanded ICD-10 code sets will enable HHS to fully support quality reporting, pay-for-performance, bio-surveillance, and other critical activities. Conversion to ICD-10 is essential to development of a nationwide electronic health information environment, and the updated X12 transaction standards are a critical step in the implementation of these new codes.”

Affected entities will include health plans, health care clearinghouses, and health care providers who transmit any electronic health information in connection with a transaction for which a standard has been adopted by HHS. Updated versions of the current HIPAA electronic transaction standards will require the use of the ICD-10 code sets for claims, remittance advice, eligibility inquiries, referral authorization, and other widely used transactions.

Many Providers mistakenly tend to see the change as more minor than it is.

Closer to home, all electronic health records and practice management software systems used at every U.S. facility will have to be updated. According to HealthTechnica.com(http://www.healthtechnica.com/blogsphere/2009/09/01/966/), many providers mistakenly “tend to see the change as more minor than it is; they see it as only a more extensive version of the yearly diagnosis code updates. Instead, transitioning from ICD-9 to ICD-10 is a huge project. It has been compared to the Y2K date correction in scale. Stakeholders include physicians, hospitals, other healthcare providers, and medical billing and health insurance claims staff, all of whom must be trained to use the new coding system. Technology vendors must update their medical record, billing, insurance and reporting software to simultaneously handle both ICD-9 and ICD-19 codes until transition is complete. Health insurance policies will also need to be updated to accommodate the newly-recognized diagnosis and procedure codes.”

And the transition will not be inexpensive. An article on the Texas Medical Association (TMA) website (http://www.texmed.org/Template.aspx?id=7345#study) estimates it will cost a total of approximately $83,000 to implement at a small, 3-physician practice and over $2.7 million at a large, 100-physician practice. Add the risks of staff not being fully trained or of entities not completing the implementation on time, include delayed or denied payments, missed payments, incorrectly processed insurance claims, and the potential for fraudulent misuse, and the costs rise exponentially.

And what are the benefits? In addition to resolving many of the limitations of ICD-9, the ICD-10 system hopes to:

improve disease management
ensure more accurate, value-based, payments for new procedures
better support quality data reporting
allow the US to compare data with international data on the spread of disease and treatment outcomes.

With all of the effort and emphasis on Health Information Exchange and Interoperability, that last item cannot be overstated. There are currently 153 other countries utilizing ICD-10-CM, and we do not have the capability of interoperability with them. ICD-10 will resolve this and several other limitations.