Will Voluntary ICD-10 Implementation Reduce Financial Burden?
By - Consider the healthcare industry deep in the trenches of an ICD-10 Cinderella effect of sorts. As the ICD-10 implementation clock continues to tick tock, the healthcare industry ruminates and deliberates about how to address projected financial challenges for providers, payers, and physician practices. Confusion abounds about the possibility of further delay, high code volume, and reimbursement costs.
The formation of a standardized international system of classifying disease is nothing new, as related efforts have continued to develop over the past 500 years, initially credited to François Bossier de Lacroix within the 1700s. What’s on the immediate revenue cycle horizon? Both positive and negative implications are heavily speculated. Upcoming benefits include the ability to study disease and injury with greater clarity and depth – a monumental achievement for both the healthcare industry and humanity at large. Speculated detriments include incredible expenses required to reach this objective; ICD-10 contains a much higher level of quite dense complexity than ICD-9. Matters of money woes stand in the way of the present and the future.
Can they become merged? Maybe. Upcoming ICD-10 implementation means physician practices will experience heavy financial burdens, according to research by John Grimsley and John O’Shea, MD, of The Heritage Foundation. Would a non-mandatory ICD-10 implementation serve as a viable revenue cycle solution? There is a possibility such a concept may reduce upcoming financial burden.
“Congress should delink the disease classification system from reimbursement policy, and make the adoption of the new ICD-10 code system voluntary until a less burdensome billing process is in place,” state Grimsley and O’Shea. “To protect practicing physicians and other health care workers from such an unfunded mandate, Congress should delink the disparate goals of research and reimbursement, and develop a more appropriate coding system that makes the billing process less, not more, burdensome,” the researchers explain.
Temporarily granting healthcare providers with the option of choice regarding whether or not to continue using ICD-9 or implement ICD-10 will allow more time to execute an alternative reimbursement arrangement, confirm Grimsley and O’Shea.
Full comprehension of ICD-10’s impact requires a vital understanding of the reimbursement process, they state. “In order to prepare for ICD-10 health care providers will have to upgrade IT systems, spend considerable time and expense training and hiring office personnel, and perform systems testing,” Grimsley and O’Shea explain. “Of greater concern, perhaps, are the recurrent costs that health care providers will face. These recurring costs, which include productivity loss and reimbursement disruptions, will pose a substantial barrier to running an efficient, viable practice in the long run,” they add.
Grimsley and O’Shea highlight the Centers for Medicare & Medicaid Services (CMS) have tangibly emphasized such concerns. “Even the CMS projects that in the early stages of implementation, denial rates will increase between 100 percent and 200 percent, and that payment delays, reflected in the number of days that a submitted claim remains in accounts receivable, will grow by 20 percent to 40 percent,” Grimsley and O’Shea maintain. “In fact, the CMS has highlighted the need for reserve funds or lines of credit to offset cash-flow challenges during ICD-10 implementation,” they add.
Mandatory ICD-10 implementation will only further intensify financial strain, they confirm. Physicians continue to face decreasing reimbursement trends in tandem with the fact that efficient operation of a medical practice is expensive. Medical practices have experienced a 52 percent increase in general operating costs from 2001 to 2010, the researchers maintain, in reference to data from the Medical Group Management Association.
“This unfunded mandate not only perpetuates a misguided policy decision that confuses the disparate goals of research and reimbursement, but adds a significant financial and administrative burden on physician practices, especially smaller practices that do not have the resources to absorb the costs of transition,” confirm Grimsley and O’Shea. “Congress should, through an equitable transition process, take this opportunity to delink research from reimbursement, abandon the mandatory implementation of ICD-10, and pursue the development of a billing system that is specifically designed to make the reimbursement process less, not more, burdensome for physicians and other health care providers,” they maintain.
The possibility of freezing ICD-10 implementation is real. The American Medical Association (AMA) recently expressed support for a legislative push from the House to essentially ban the Secretary of the Department of Health and Human Services (HHS), Sylvia M. Burwell, from replacing ICD-9 with ICD-10 within HIPAA code set standards implementation. Additionally, some physicians advocate for another ICD-10 delay since the Sustainable Growth Rate (SGR) reform legislation lacked such content. Healthcare payers and providers may be running out of time regarding successful completion of end-to-end claims testing.
Will the ICD-10 Cinderella effect be more seamless than anticipated? Will there be a disastrous surplus of lost glass slippers or a more promising fairy-tale-esque ending? What does the crystal ball show for the future of revenue cycle management? Will there be millions in unpaid claims? Will a surplus of denials and rejections be commonplace come October? Does successful ICD-10 testing mean a smooth transition? Perhaps for now, the answer to all of these questions, and many others, is merely vague uncertainty. More challenges and glitches require immediate addressing to minimize financial burden into October, and beyond.
