Planning Our Way for Coding and System Changes

1. Planning Our Way for Coding and System Changes Virginia Long, RN, LHRM, CPC President, Advanced Medical Services

2. Risk Management • Risk Management Services include • ASSESSING THE ORGANIZATION FOR RISKS • IDENTIFYING RISKS • MINIMIZING OR ELIMINATING RISKS

3. As a Risk Manager I can tell you that every company represented in this room will be walking a tight rope Oct. 1, 2014. Every healthcare provider, billing company, clearinghouse and affiliated companies are at RISK!

4. ICD 10 - What Does It Mean To You? We have all heard about ICD 10. O.K. so it means a lot more coding. Of course everyone knows it will mean studying and learning the new codes. However, have you thought about all the areas in which ICD 10 will have collateral damage? Some of those areas may affect you. ICD 10

5. Collateral Damage From Bay News 9 Universal Health Care layoffs will have ripple effect in downtown St. Pete. Some 800 employees lost their jobs at the company's headquarters at 100 Central Avenue. Their loss will impact such local businesses as a Subway shop, Fortunato's Italian Market, the Lucky Dill, Z Grille, Bull Fitness and Detroit Liquors. "It's bad," Subway manager James Clayton told the Tampa Bay Times. "They're 50 percent of my business. I don't know how this is going to play out. I'll start ordering less food and making less bread."

6. Will it happen??? OCTOBER 1, 2014

7. March 13, 2013 Marilyn Tavenner Confirmed: Healthcare experts still hoping for another ICD-10 reprieve appear to be out of luck, according to Acting CMS Administrator Marilyn Tavenner, who confirmed that the implementation date of October 1, 2014 won’t budge during a speech at HIMSS13. As if to reconfirm its commitment to the current date, CMS has been releasing a series of ICD-10 resources, including detailed timelines and updated implementation guides for practices looking for help.

8. Why Change? ICD-10-CM incorporates much greater clinical detail than ICD-9-CM. The modern classification system will provide much better data needed for: • Measuring the quality, safety, and efficacy of care; • Reducing the need for attachments to explain the patient’s condition

9. Designing payment systems and processing claims for reimbursement; • Conducting research, epidemiological studies, and clinical trials; • Setting health policy; • Operational and strategic planning; • Designing health care delivery systems; • Monitoring resource utilization; • Improving clinical, financial, and administrative performance;

10. Preventing and detecting health care fraud and abuse; and • Tracking public health and risks.

11. To Understand How ICD 10 Will Affect Us Let’s Look At the History The World Health Organization publishes the International Classification of Diseases (ICD) code set which defines diseases, signs, symptoms, abnormal findings, complaints, social circumstances, and external causes of injury or disease. The WHO authorized a US adaptation of the code set for Clinical Modification (CM).

12. Currently the United States uses the ICD ninth edition originally published in 1977. • ICD-9-CM (Clinical Modification), used in all health care settings • ICD-9-PCS (Procedure Coding System), used only in inpatient hospital settings. In 1990, the WHO updated to the ICD-10. Othercountries began using ICD-10 in 1994 but the United States only partially adopted ICD-10 in 1999 for mortality reporting.

13. Some Major Countries Utilizing ICD-10

14. Limited Implementation • Germany • Australia • Canada Only implemented ICD 10 in hospitals

15. Productivity Productivity was reported to drop when ICD-10 was implemented. Some countries reported a drop from normal to 60%. The ICD-10 codes will be increasing from approx. 15,000 ICD-9 codes to 150,000 ICD-10 codes. Thus proper planning, training, and implementation are essential to protect the business entity.

16. Canada’s Experience • Five year transition plan to implement ICD-10 while U.S. has set three (extended to four) years. • Implemented only in hospital setting while U.S. is implementing in all healthcare settings and ICD-10-PCS in the hospital inpatient setting only. • Did a test pilot in the province of New Brunswick, while unfortunately the U.S. has not performed any pilot test.

17. Canada’s Experience cont. • Canada had to begin using more encoder software while U.S. already widely uses encoder software in hospital settings. • Canada expanded procedural coding from 3500 codes to 20,000 while U.S. will expand from 4,000 to 72,000 with ICD-10-PCS. • Canadian government paid for the transition, covering hardware and software upgrades and training while in the U.S., the cost will be paid by the providers.

18. What Changes Occur with ICD 10?

19. Format and Structure • Categories • Alphanumeric 3 characters • Subcategories • 4 or 5 characters • Codes • Up to 7 characters

20. ICD-9-CM verses ICD-10-CM • The ICD-10-CM code range for diabetes mellitus has over 210 codes. In order to code diabetes mellitus in ICD-10-CM the following is necessary: • Type of diabetes • Body system affected • Use of insulin • Complications • Manifestations • Reason for secondary diabetes mellitus

21. New Features in ICD-10-CM • Laterality (left, right, bilateral) • Combination codes for certain conditions and common associated symptoms and manifestations. • Combination codes for poisonings and their associated external cause. • Obstetric codes identify trimester instead of episode of care.

22. Character “x” is used as a 5th character placeholder in certain 6 character codes to allow for future expansion and to fill in other empty characters (e.g., character 5 and/or 6) when a code that is less than 6 characters in length requires a 7th character. • Two types of Excludes notes • Excludes 1 – Indicates that the code excluded should never be used with the code where the note is located (do not report both codes). • Excludes 2 – Indicates that the condition excluded is not part of the condition represented by the code but a patient may have both conditions at the same time, in which case both codes may be assigned together.

23. There will be inclusion of clinical concepts that do not exist in ICD-9-CM. • A number of codes have been significantly expanded. • Codes for postoperative complications have been expanded and a distribution made between intraoperative complications and post procedural disorders.

24. Additional Changes Found In ICD-10-CM • Injuries are grouped by anatomical site rather than by type of injury; • Category restructuring and code reorganization have occurred in a number of ICD-10-CM chapters, resulting in the classification of certain diseases and disorders that are different from ICD-9-CM; • Certain diseases have been reclassified to different chapters or sections in order to refelct current medical knowledge;

25. New code definitions (e.g. definition of acute myocardial infarction is now 4 weeks rather than 8 weeks.) • The codes corresponding to ICD-9-CM V codes (Factors Influencing Health Status and Contact with Health Services) and E codes (External Causes of Injury and Poisoning) are incorporated into the main classification rather than separated into supplementary classifications as they were in ICD-9-CM.

26. ICD 10 Quiz • Code for “bizarre personal appearance is” • Code for “very low level of personal hygiene” • Code for “burn due to water-skis on fire”

27. R46.1 is “bizarre personal appearance”R46.0 is “very low level of personal hygiene” V91.07XA, “burn due to water-skis on fire”Others:W22.02XA, “walked into lamppost, initial encounterW22.02XD, “walked into lamppost, subsequent encounter”Additionally, there are 312 animal codes, including “being bitten by a sheep (W55.31)” and “Butted by a pig (W55.32).” Codes for a duck, macaw, parrot and even a turkey are part of the package. Unbelievable? One code for suturing an artery will become 195 codes.

28. Types of Problems to Expect Let’s track a claim to see what to expect!

29. Provider Coding • Physician diagnosis • Physician charts diagnosis • Physician is unable to code so simply writes the description – did he remember to state right or left? • If abdominal tenderness is it of the left lower quadrant, the left upper quadrant, periumbilic, the right lower quadrant, the right upper quadrant?

30. Provider Coding • Physician productivity decreases and less patients seen per day • Patients upset due to long waits • Claim rejected due to incorrect diagnosis coding and lack of medical necessity • Loss of or delay of revenue due to unpaid claim

31. Computer Capability • Diagnosis code is entered into the computer system. • For services on Sept. 30, 2014 enter the ICD 9 code and CPT code. • For services on Oct. 1, 2014 enter the ICD 10 code and CPT code. Many medical computer software programs will not be able to process both the ICD 9 and the ICD 10 codes!

32. Clearinghouse New mapping by the clearinghouse to the insurance provider will be required. The clearinghouse will have to be capable of transmitting claims with both ICD 9 codes and ICD 10 codes. Edits at the clearinghouse will result in a large number of rejected claims even though the claim was submitted correctly. The result is a delay in reimbursement as clearinghouses work through the multiple mapping issues that will occur.

33. Insurance Company Medicare, Aetna, United, BCBS, Medicaid and hundreds of small insurance companies must be able to receive claims from the clearinghouse and process those claims. Again they will be receiving and processing claims with both ICD 9 and ICD 10 on the same days for a lengthy period of time – at least 6 months to one year. Claims will be edited and rejected incorrectly. Claims will be re-submitted and often again rejected.

34. Accounts Receivable Accounts Receivable are at risk! If there is no revenue or greatly decreased revenue, there is no money to pay the lease, the staff of practices are extremely frustrated, the employees of the software companies that close loose their jobs, - - - - - - - - - - - - - - - ! COLLATERAL DAMAGE

35. What to Expect • Billing error rates expected to rise from 3% to 10% for at least 6 months. • Increase in Accounts Receivables with slowing of revenue. • Rise in coding services costs from contract coders. • Increase in staff coding personnel and salaries.

36. What are the Financial Impacts and Risks? • Cost of Software Conversion • Cost of software • Cost of training on software changes • Cost of rebilling and follow-up • Cost of cash flow delay • Cost of Training • Cost of Development of Training • Cost of Materials • Cost of Labor for Trainers and Attendees. Also replacement labor while attendee in training.

37. Let’s Take a Rough Look at Some Possible Costs • Physician Practice with two physicians and combined collections of $100,000 per month. • Five staff members. One front desk, two MAs, one biller, and one person who is responsible for AP, floats, and covers for days off. • Accountant is a consultant. Accountant normally compiles monthly financials, compiles an annual budget, and prepares taxes.

38. Possible Cost for This Physician Practice

39. This physician practice will need to borrow enough money to pay for this house just to survive during the transition period.

40. Minimizing Risks • How should we prepare? • Go to CMS - ICD 10 on google • Review the various CMS resources • Find the model implementation plan for your practice or hospital size • Inform decision makers that ICD 10 will have a great deal of collateral damage requiring many preparations other than simply training on the new codes

41. Training • Train all decision makers now on what to expect and begin a transition plan. • Provide additional Anatomy and Physiology Training to anyone responsible for coding and auditing in 2013. • Review the CMS “Mapping” webpage and utilize as part of training • Begin ICD 10 code training in 2014

43. Code Mapping General Equivalency Mappings (GEMs) attempt to include all valid relationships between the codes in the ICD-9-CM diagnosis classification and the ICD-10-CM diagnosis classification. The tool allows coders to look up an ICD-9 code and be provided with the most appropriate ICD-10 matches and vice versa. GEMs are not a crosswalk but merely a guide. Many errors have already been found in the GEMs.

44. Minimizing Coding Risks • Budget for time Physicians and Mid Level Practitioners spend in training. • Budget for training of staff and replacement staff needed for operations while staff train. • Budget employment of Coders/Auditors to review claims prior to submission. • Budget for extra staff to review rejected claims and resubmit.

45. Minimizing IT Risks • If needed, select new software and train staff. • Obtain written assurance from clearinghouse that clearinghouse will be capable of transmitting both ICD 9 and ICD 10 claims simultaneously. Ask for verification of test transmittals to payors. • If utilizing a billing company, receive guarantees from billing company that company will be capable of meeting the ICD 10 requirements.

46. Minimizing Rejections • Have a coder check or code each claim before it is transmitted. • Check the clearinghouse report for rejections daily. • Work Clearinghouse rejections and rejected EOBs quickly to minimize time delay in accounts receivable. • Have extra coders available and policies and procedures in place so that coding errors can be quickly corrected and rebilled.

49. ARE THERE OTHER CHANGES ON THE WAY ICD 11 COMING SOON! WHO TO RELEASE 2015

50. OPPORTUNITIES Now is a great time for billers, coders, auditors to position themselves for financial benefits and promotions by becoming experts in managing the ICD 10 coding and the collateral damage that will occur. By being prepared, you can lead your organization to smooth sailing!