Providers Expect Revenue, Productivity to Drop after ICD-10
By A lack of ICD-10 preparation may lead to negative revenue cycle impacts after October 1, 2015.
- Healthcare organizations may still have just under a year to prepare for the revenue cycle and billing office impacts of ICD-10, but many are still concerned that they will see a dip in their financial health and a significant hit to productivity for coding inpatient encounters, according to a new survey from AHIMA and the eHealth Initiative. Just over one-third of providers anticipate a revenue decrease after October 1, 2015, while 59% are bracing themselves for slower, more difficult claims processing.
Perhaps more worrying than the number of negative predictions is the fact that 27% of providers have not conducted a revenue impact assessment, and therefore have no clear idea of where they will fall on the financial spectrum or how to mitigate potential areas of concern. The finding closely mirrors results from a recent WEDI survey which also found that a quarter of providers have not completed impact assessments to prepare themselves for the transition. A further 18% of participants in the AHIMA poll are simply not sure whether ICD-10 will produce negative, neutral, or positive revenue impacts.
Ten percent of organizations have no plans to conduct internal end-to-end testing, with more than a third of those organizations, primarily clinics and smaller physician practices, citing a lack of knowledge about the process as the reason behind the decision.
Of the 63% of organizations who are ready to conduct testing by the end of 2014, “respondents frequently indicated that they are not aware of when their key business partners will be prepared to conduct testing,” the report says. “Respondents were more likely to know when larger partners such as clearinghouses, IT vendors, acute care hospitals, and health plans were prepared to conduct testing. More of these larger organizations have also indicated to their partners that they will be prepared for testing in 2014 than smaller organizations such as physician practices.”
In addition to worries about fluctuating revenue due to shifts in DRG codes or denied claims that must be resubmitted with more robust documentation, productivity remains a chief concern. Fifty-nine percent of respondents believe that coding will become more difficult, while 42% are not sure that their clinical documentation is up to the task. Forty-one percent of providers believe patient encounters and adjudicating reimbursement claims will be more difficult under the new code set.
However, there is a glimmer of optimism mixed in with the results. Providers generally understand that ICD-10 will bring an increase in specificity and detail that can improve the accuracy of claims (41%), boost patient safety (27%), and provide necessary data for quality improvement and outcome measurement, which may ultimately contribute to the financial health of an organization. Six percent of providers believe their revenue might measurably increase after ICD-10 compliance, while 14% think that the new codes will not impact their revenue cycle management in any significant way.
“There is widespread recognition that although ICD-10 may burden providers and organizations now, it has tangible benefits that may be realized in the long term,” the report concludes. “Evolving healthcare payment and delivery models, like accountable care organizations, necessitate improved capacity for measuring performance, cost, and outcomes. Respondents recognize that the increased specificity of ICD-10 is likely to have a positive impact in these areas, which may ultimately help to increase revenue as organizations become better equipped to meet requirements for value-based reimbursement.”
