ICD-10 Coding…What it is all about…What Effect Will It Have On Your Practice

ICD codes are medical diagnosis and procedure codes used for billing and health insurance reimbursement, automated decision support and government statistical reports on morbidity and mortality. In fact, they are used around the world – ICD stands for International Classification of Diseases. Not a US creation, the ICD coding system is published by WHO (the World Health Organization, a UN agency) And they’ve been around a long time: Version 1 was created in 1900, with precursors to the ICD codes existing as early as 1853.

ICD-10 is the latest revision. To the US healthcare IT industry, ICD-10 seems like the next big thing, but in fact it’s been in existence since 1990. To date, 153 nations use the ICD-10 codes, though not all of them use the coding system in its entirety. In the US, ICD-10 codes are “not currently valid for any purpose or use,” according to the National Center for Health Statistics, a division of the CDC. The government does use the codes for mortality reporting, according to the American Health Information Management Association, but that is about all.

The US still uses the old ICD-9 coding system. The limitations of this outdated system are increasing as new diagnostic and treatment procedures become available, because ICD-9 does not have the ability to add new codes for them. The same is true for new diagnoses. The system also cannot provide granularity of subclassifications of diagnoses or related problems from socioeconomic or lifestyle issues. Moreover, because one of the main uses of the ICD codes is in the medical billing – health insurance payment transaction, and that transaction is now almost universally done electronically, there is a need for the transaction to be able to use the new HIPAA electronic transaction forms. ICD-9 codes are not set up to do this.

What does this mean?
One thing it means is that healthcare providers cannot always give the most accurate diagnosis and procedure information. This generates more work on the part of health insurance companies, as claims analysts must review ambiguous codes in billing, and medical reviews must be done case-by-case for tests and treatments that might otherwise be standardized by codes. It means valid medical care bills are sometimes denied or that payments for them are determined incorrectly because the true value cannot be easily seen from the codes. It can potentially seriously affect patient care, as inaccurate coding can lead to missing the true diagnosis and prescribing the wrong treatment. It means that public policy does not have the most accurate information from their research. And it means that, because the US is behind a whopping 153 other countries in getting up to speed, we do not have the capability of interoperability with them.

ICD-10 will resolve these limitations.

A comparison of ICD-9 and ICD-10

Moving to ICD-10
When will we move to using the ICD-10 codes? The mandated implementation date has been pushed back from October 1, 2011 to October 1, 2013. By that date, use of the ICD-9 code set must be replaced by the ICD-10 code set.

Hospitals, and physician practices and health insurance companies should be gearing up for ICD-10 now. Most have not started or have begun only rudimentary planning. They should have identified staff to train on ICD-10 and develop training materials. Product requirements need to be determined.

One reason is that providers tend to see the change as more minor than it is; they see it as only a more extensive version of the yearly diagnosis code updates. Instead, transitioning from ICD-9 to ICD-10 is a huge project. It has been compared to the Y2K date correction in scale. Stakeholders include physicians, hospitals, other healthcare providers, and medical billing and health insurance claims staff, all of whom must be trained to use the new coding system. Technology vendors must update their medical record, billing, insurance and reporting software to simultaneously handle both ICD-9 and ICD-19 codes until transition is complete. Health insurance policies will also need to be updated to accommodate the newly-recognized diagnosis and procedure codes.

It will be costly. According to an article on the Texas Medical Association website ( http://www.texmed.org/Template.aspx?id=7345#study ), it will cost approximately $83,000 to implement at a small, 3-physician practice and over $2.7 million at a large, 100-physician practice.

Risks of not being fully trained or of not completing the implementation on time include delayed or denied payments, missed payments, incorrectly processed insurance claims, and the potential for fraudulent misuse.

Why It’s Worth the Effort and Expense

We’ve examined the limitations of the ICD-9 system. We’ve looked at some of the differences between ICD-9 and ICD-10. Besides resolving the limitations of ICD-9, the ICD-10 system will:

* improve disease management
* ensure more accurate, value-based, payments for new procedures
* better support quality data reporting
* allow the US to compare data with international data on the spread of disease and treatment outcomes.