Healthcare Revenue Cycle Management, ICD-10, Claims Reimbursement, Medicare, Medicaid

Policy & Regulation News

Does 2015 ICD-10 Transition Mean Millions in Unpaid Claims?

By Jacqueline DiChiara

- A hundred physician groups, including the American Medical Association (AMA), expressed strong trepidation regarding the potential for a dangerous accumulation of millions of dollars in unpaid Medicare claims when the ICD-10 transition goes into effect on October 1.

In a letter to the Acting Administrator of the Centers for Medicare & Medicaid Services (CMS) Andrew Slavitt, the medical societies have expressed concern that strong contingency plans have not yet been established to prevent critical disruptions for the October 1 conversion to ICD-10 diagnostic and procedural codes.

A number of additional concerns did not yet appear to be addressed by the CMS, they state. The groups claim that weakly established contingency plans will mean a multi-billion dollar disruption for physicians and critical issues with Medicare beneficiaries’ access to care.

“By CMS’ own analysis, one of the most significant risks to moving to ICD-10 is the likelihood for claims processing and cash flow interruptions,” the letter states, in an appeal for more elaborately defined end-to-end testing results.

“[Acknowledgement testing] provides no information about if and how the claim will process completely, ensuring payment to physicians,” the groups continue.

Medicare processes 4.4 million claims daily. Even a minute change in Medicare claims acceptance will monumentally influence payment to physicians, the letter says. The physician groups were concerned with the CMS’ acknowledgement testing’s limited results and requested any encountered errors be clarified further as well as solutions further defined.

One flaw the groups identified in CMS’ end-to-end testing was in regards to the erroneously chosen and executed sample size.

The group surveyed was simply too small to be deemed as an accurate industry-wide representation, the letter added. A larger sample size would be more indicative of actual implementation results.

Additionally, since those surveyed were volunteers, it is quite possible the results are an inaccurate read on implementation readiness, as those who were not confident in their ICD-10 preparation might not have been as willing to contribute their information, affirms the letter.

Other concerns about the perilous ICD-10 effects were in regards to Value Based Modifer (VBM) measures.

“In part, the VBM formula compares how providers perform from year-to-year. Accordingly, transitioning the VBM program to the more granular ICD-10 system could significantly alter how measures are scored between the baseline and performance periods,” the letter says. “Similarly, commercial payers also have quality reporting systems that impact physician reimbursement and ratings and are likely to be affected by the code set change,” the groups continue.

“By CMS’ own analysis, one of the most significant risks to moving to ICD-10 is the likelihood for claims processing and cash flow interruptions. It is therefore vitally important that CMS is prepared with extensive contingency plans in the event that these feared disruptions occur,” they add.

Another concern was that there was no available data from CMS about when vendors will be ready to deliver ICD-10 upgrades. It was also unclear if vendors who do not certify to 2014 receive any help or support after the fact.

“The likelihood that Medicare will reject nearly one in five of the millions of claims that go through our complex health care system each day represents an intolerable and unnecessary disruption to physician practices,” said AMA President Robert M. Wah, MD in a jointly released statement.

“Robust contingency plans must be ready on day one of the ICD-10 switchover to save precious health care dollars and reduce unnecessary administrative tasks that take valuable time and resources away from patient care,” he maintained.

ICD-10 implementation is a monumental undertaking, essentially one of the largest in the history of health care. Contingency plans may resultantly be unsatisfactory if serious disruptions occur in October.



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