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

Policy & Regulation News

Many Denials, Rejections to Follow the ICD-10 Transition?

By Jacqueline DiChiara

- After profuse speculation and ample delay, the deadline for the healthcare industry ICD-10 transition remains set for Oct. 1, 2015. As popular speculation of especially disastrous results prospers, it is feasible massive denials and rejections follow the ICD-10 transition.

Douglas Kegler, CEO and Founder of CollaborateMD (CMD), Inc., spoke to this week to offer further commentary regarding an announcement of CMD’s successful January ICD-10 end-to-end testing with the Centers for Medicare and Medicaid Services (CMS).

Kegler anticipates payers simply need to perform to the best of their ability and expect the candid refusal and denial of a high volume of valid claims.

“The insurance payers will do the ‘best’ they can to be prepared. I say ‘best’ because the payers’ cash flow is not [influenced] when the ICD-10 changes are implemented,” says Kegler. “I hope the payers have their IT and technical resources ramped up and ready to fix their systems ASAP when they start denying and rejecting tens of thousands of valid claims.”

CMS should consider ICD-10 end-to-end testing as only the beginning efforts, says Kegler.

“The software vendors and clearinghouses are more prepared than the transition to ANSI-5010 a few years ago, but I believe there is a lot more testing that needs to be done,” Kegler states. “The sample size for the CMS end-to-end testing was too small and I hope Medicare continues to expand the testing participants as we progress towards the Oct. 1 deadline.”

The conversion to ICD-10 this fall may be the largest financial disaster ever for the medical community, as reported recently on Kegler says these anticipated grim implementation results may mirror those of former healthcare changes.

“When ANSI-5010 went into effect, the majority of my customers had a large delay in cash flow due to the payers not testing enough and having severe issues processing claims,” Kegler states. I believe the same thing is going to happen this October.”

The transition will financially devastate those smaller practices nationwide already strapped economically, says Kegler.

“What the government should have done is make short term loans available to medical practices during the past ANSI-5010 transition and the upcoming ICD-10 transition (like they did for the auto manufactures and banks during their crisis and homeowners during the real estate crisis),” states Kegler.

ICD-10 implementation means medical offices will need to spend time they do not really have available focusing on claims, Kegler continues. Additional time spent on EHR’s and coding and filing claims will likely stretch practices too thinly.

Kegler says his specific experience as a software vendor leads him to believe rule sets need further examination.

“Reimbursements will be affected because the insurance payers had to update all of their rule sets to include processing directives for 68,000 codes versus 13,000,” says Kegler. “The odds are that these new rules have not been thoroughly tested with all of the possible variations and the end result will be denied and rejected claims and reduced cash flow for the providers.”

The necessary future direction of revenue cycle management should be primarily focused on furthering education and expanding training, says Kegler.

“Primary focus for 2015 is stressing to customers the impact ICD-10 will have on them financially and training them on reports and processes required to manage the denials and rejections once ICD-10 occurs.”



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