Guest post by Lindy Benton, president and CEO, Vyne.
The world of denials management is a constantly shifting landscape, one that has changed dramatically with the onset of ICD-10. Now more than ever, denials management requires an organizational focus with built-in workflows for prevention, monitoring and tracking of claims through the system.
In the years leading up to ICD-10, providers were apprehensive about the potential drain it would place on both resources and reimbursement. CMS predicted that – with the onset of ICD-10 – denial rates would increase by 100 to 200 percent, days in A/R would grow by 20 percent to 40 percent and claims error rates would more than double. CMS warned that error rates could reach a high of 6 percent to 10 percent, significantly higher than the 3 percent average error rate with ICD-9.
Providers also feared cash flow problems stemming from coding backlogs, expected to increase by at least 20 percent because of the complexity of the new coding system. “A typical turnaround time for claims processing of 45 to 55 days could end up being extended another 10 to 20 days,” cited Healthcare Payer News.
And the change has been momentous. With ICD-10, the number of diagnostic codes increased from 13,000 ICD-9 codes to 68,000 ICD-10 codes. The new system challenges providers to document conditions more specifically, supporting codes with thorough and accurate medical documentation.
Despite the gravity of the change, many providers say it has been a smooth transition thus far, with minimal delays in productivity and reimbursement. But as the industry moves through this period of adjustment, providers must continue to seek opportunities to protect revenue and generate cash flow for a successful claims management strategy in the wake of ICD-10.
ICD-10 requires an organizational focus around the management, prevention and defense of denials. Denials management is no longer an effort reserved just for the revenue cycle but for all departments. For coding to complete a claim, pieces of information must be collected from multiple areas across the organization. For this reason, all departments should be educated on the part they play and how cross-department collaboration can aid the process.
In preparing providers for ICD-10, the Healthcare Financial Management Association (HFMA) noted, “Claims denials will not strictly be a matter of clarification that can be handled by a nonclinical person in the billing office. Denials will raise questions about medical necessity or the clarity of medical documentation supporting a code; such questions will require input from a physician, nurse specialists or outside expertise.”
Workflow processes are also critical as hospitals work to achieve accurate coding and get bills out the door. Technologies that streamline hand-offs between departments can help reduce bottlenecks that often delay reimbursement. A work queue keeps denials moving, assigning and tracking accountability at each checkpoint and monitoring progress to ensure no claim falls through the cracks.
Guest post by Michele Hibbert-Iacobacci, CMCO,CCS-P, vice president of information management support, Mitchell International.
Recent ICD-10 end-to-end testing conducted by CMS and the American Medical Association yielded an 87 percent claim acceptance rate. This means that of the 29,286 test claims received, only 25,646 were accepted. Imagine thousands of claims denied due to providers submitting improper codes, stalling the bill review process and creating pain for everyone involved.
The one percentage drop in claims accepted from the month prior is a poor indication for the months ahead, as 100 percent of the test participants claimed to be fully ready for the October 1 ICD-10 implementation date. It’s only logical that many carriers and providers wonder what will happen to those that aren’t ready.
The end-to-end testing results also raise complicated questions: Which ICD-10 codes will be seen most frequently post-implementation date? And will these codes match what providers will put on the bills they send?
It’s no secret that ICD-9 has a lot fewer codes than ICD-10 and a situation is simply less complicated with less contextual data to worry about. As a result of the influx of new codes presented by ICD-10, we can expect to see providers assigning way more codes than necessary to bills in a pin the tail on the donkey-type attempt to choose the right code. For example, there are ten codes for a fracture to the tibia in ICD-10, as opposed to one in ICD-9. So many options may lead a provider to place all ten on a bill, to ensure payment is received.
It will be challenging for untrained providers to submit the correct ICD-10 codes, and as such, productivity will decrease alongside increasing reimbursement challenges and potential claim denials. Carriers, on the other side, will be forced to conduct extensive reviews of each bill to determine the actual injury cause and appropriate code.
To handle the huge influx of ICD-10 codes, providers can design a system where the office coders are provided with quick references to the most prevalent codes used in the practice. Over time, the overall billing experience will improve as coders become more skilled in identifying proper codes and carriers become more precise in reviewing bills. At first, carriers will be tolerant toward the reporting of multiple or vague codes. However, with each passing day post-implementation of ICD-10 carriers will become increasingly strict. Providers will be required to submit correct coding pending the value provided by the classification system accurately describes patient conditions.
Errors in medical billing are a serious problem in healthcare today. By some estimates, as many as 80 percent of all submitted bills contain some sort of error, which leads to increased costs for Medicare, insurance carriers and patients, but can also lead to coverage denials, reduced reimbursements for providers, and in some cases, impacts on patient care.
While many organizations have placed a priority on avoiding billing errors, they still occur. And with the upcoming transition to ICD-10, home health and hospice providers are under even more pressure to get billing right the first time, every time. By most accounts, providers can expect to see a spike in rejected claims during the first few months of ICD-10 implementation; some estimate that as many as 10 percent of all claims will be rejected as coders get used to the new procedures. That’s bound to have an effect on payments and cash flow, so it’s vital that agencies work with their billing offices to identify common errors now, and look for ways to overcome them.
Preparing for the Transition
Ideally, home health agencies should be in the final stages of preparing for the launch of ICD-10 now. August 3 marked the beginning of the 60-day episode period that would end on October 1, when ICD-10 goes into effect. This means that agencies that are beginning care episodes now are required to submit RAPs in ICD-9, but code them in both ICD-9 and ICD-10, so that when the final bill is submitted to Medicare, it will be in the correct format. In many ways, this gives home health providers an advantage, since they will have two months’ worth of practice with the new codes on almost every chart, where most other providers are only practicing dual coding on some charts.
Because of the dual coding requirements, most home health providers have already switched to an ICD-10 compliant software solution. Now is the time to identify gaps in training, and adjust intake procedures, forms and other resources that affect how services are billed. Mitigating potential obstacles now will prevent denied claims later, and smooth the transition.
The Most Common Errors
While the new coding procedures will undoubtedly be a learning curve for many providers, you can reduce the overall number of denied or delayed claims by paying close attention to the most common errors and taking steps to avoid them. These include:
Guest post by Daniel Schwartz, content strategist, CureMD.
On Oct. 1, 2015, the 10th revision of the International Classification of Diseases, or ICD-10, will go into full swing, requiring that all healthcare institutions and organizations covered by the Health Insurance Portability Accountability Act comply as such. This will mark a transition from the previous classification of diseases, called ICD-9. The Centers for Medicare and Medicaid Services (CMS) has already released several documents and other mediums of information to help answer questions and concerns about this upcoming change and to provide avenues of approach to handling the upgrade, and you might find that, if you’ve waited until now to begin preparation or even so much as to begin thinking about this major coding change, you’ve waited far too long.
In a recent survey done by the Workgroup for Electronic Data Interchange (WEDI), 25 per cent of physicians stated that they are not going to be ready when the ICD-10 compliance date arrives, and another twenty five per cent stated uncertainty. Marcia Frel lick, author of the article on Medscape that represents this statistic, writes that Robert Tennant, vice chair of the WEDI group, says that “the physician side of the provider community [is] really struggling,” and, judging by the numbers in their survey, he seems to be largely correct.
Exactly a year ago, Aug. 10, 2015, the first phase of the recommended transition process, suggested and published by aafp.org in early 2014, would be less than two months away. This debut entry into the process would begin October 1 and end in December, and would include necessary tasks such as scheduling hard-date meetings with committees and personnel, conducting large inventories of coding, becoming vastly familiar with the ICD-10 coding itself, budgeting for the transition, learning your implementation plan, and much more. After the completion of the first phase, the second phase would then begin in January of 2015 and last until April, demanding the passing of tasks like completing ICD-10 training on all levels, reviewing insurance contracts, evaluating your current cash flow, and determining the impact quality initiatives, such as PQRS and Electronic Health Records, had in 2014 for your institution. These are only two of the five total phases aafp.org suggests you complete, and if you’re just now starting to look over what needs to be done, you’ll be cramming all of this scheduling, monitoring, determining, and preparing while you’re already integrating ICD-10—specific workflow plans, processes, and claim submission resources; in other words, you’ll be doing far too much within a miniscule time period, leaving too much room for error, failure, and dissatisfaction.
ICD-10 will provide more than 14,400 distinctive code sets and the ability to track many new diagnoses for hospitals and other practices. Such a large database of higher-echelon information does not demand proper transition, but requires it. Since the current ICD-9 codes are being used in almost all current healthcare processes, rather significant and grandiose substitutions and reincarnations are going to have to take place. This large-scale implementation is required so as to ensure that the codes will be put into place and used correctly, because of the improvements they carry for features such as service reimbursement, coverage qualifications, population health management and reporting, and more.
If you’re already feeling concerned about waiting too long, there are other concerns you should be worried about that would have been your only concerns if the proper preparation-phasing would’ve taken place much earlier in the year. A lot are worried that the translations from the previous ICD-9 to the current ICD-10 will not be straightforward or easy to follow, and some of these translations are indeed not directly correspondent. They include disproportionate changes that go both ways, from ICD-9 to ICD-10 and vice versa. In spite of this, there have been tables and crosswalks published to make this transitional process more painless, but it’s going to take more study and observation in order to properly determine how the coding will completely change. Practices and institutions of healthcare that have not been preparing sufficiently for these new and complex implementations and upgrades ICD-10 will bring will be maniacally wishing they had when the date of compliance arrives.
We are nearly three months removed from the oft discussed ICD-10 deadline, currently scheduled to take effect Oct. 1, 2015. Barring any last-minute shenanigans by those in Washington, there is little do but wait, and prepare as best as possible for the transition to the new code set in the time remaining.
While there remains plenty of activity on Capitol Hill to, in the very least, delay parts of the roll out of ICD-10, there are countless organizations and individuals who are actively lobbying against a change to the 10th version of the International Classification of Diseases. For example, the American Medical Association has been a staunch antagonist rallying its members against the change. And, as recently as May 2015, the Heritage Foundation, with its report titled, “The New Disease Classification (ICD-10): Doctors and Patients will Pay,” made some strong recommendations against it: “While an updated diagnostic system for disease classification might be in order, there are significant costs and trade-offs,” write Heritage authors John O’Shea, MD, and John Grimsley, reported by Healthcare IT News. “To protect practicing physicians and other healthcare workers from such an unfunded mandate, Congress should delink the disparate goals of research and reimbursement, and develop a more appropriate coding system that makes the billing process less, not more, burdensome.
“In the interim, Congress should allow providers to have the choice of continuing to use the current ICD-9 system or adopt the new ICD-10 system until the alternative reimbursement arrangement is complete.”
However, given this level of dissent toward ICD-10, or the level of dissent that’s reported by the major healthcare news organizations, there’s actually a good deal of support for the change in code sets. When asked about moving ICD-10 forward or further delaying it, the responses received by Electronic Health Reporter were overwhelmingly in favor proceeding with the current timeline, and by no small margin. The following comments from some of healthcare’s insiders provide proof of that, and show that there are those among us that want to move on as soon as possible, and put the past to rest.
Dr. Jon Elion, MD, FACC, founder and CEO of ChartWise Medical Systems I’m in favor of the transition to ICD-10 this October. The ICD-9 code set no longer provides the level of specificity necessary to adequately account for many of the patient ailments physicians are seeing today. After 30 years, the code set is outdated and cannot describe all of the diagnoses and procedures that have been discovered or created during that time. Many codes have been “lumped” together so that meaningful statistics and data analysis are not possible. For example, suturing the aorta (largest artery in the body) has the same ICD-9 code (39.31) as suturing an artery in the hand, despite the fact that they are vastly different in the resources the hospital expends in supporting the different procedures. Furthermore, delaying the transition again will only serve to prolong the limbo hospitals, medical centers and physicians have been in for the past few years. Waiting until ICD-11 also isn’t an option as the first versions won’t be ready until 2017 at the earliest and it will be years after that before a version is prepared that will work for the complexities of coding inpatient morbidity and mortality. ICD-10 is the best option we have right now to provide the level of detail physicians and coders need to properly convey patient symptoms and diagnoses.”
Keith Eggert, FHFMA, executive vice president and general manager, healthcare, VisiQuate
“In the short term, converting to ICD-10 has been a significant undertaking for the industry. But in the long run, it’s a valuable investment because more specific Dx and inpatient procedure codes can lead to more precise diagnostic, utilization and billing data, which positively affects revenue capture. They can also have a positive impact on clinical outcomes. Fortunately, there are third-party vendors who have solutions that eliminate much of the staff time and expense needed to convert to ICD-10 manually.”
I can honestly say with a resounding yes, I am in support of the ICD-10 transition. At this point, I feel any provider that is not ready for the transition, will never be ready and any further delay will add more burden than relief. I have been teaching ICD-10 since 2011 and I know the providers that I spoke to before the last delay were frustrated with the amount of time and most of all money that was spent only to have it delayed one more year.
Guest post by Alex Tate, digital marketing specialist, content strategist and a health IT consultant at CureMD.
Most conductors are sounding out the last call for passengers to climb aboard the ICD-10 train. Although the trains won’t reach full steam until Oct. 1, 2015, the test runs will commence shortly. You’re probably wondering why passengers have to sit through these test runs, right? This is because the journey will last for at least 10 years, so everyone needs to get accustomed to the environment of this locomotive.
Your practice is the train, you are its railroad engineer, the conductor is your practice manager, but who are the passengers? Surely not the patients; they don’t need to apply the codes, do they? The answer to both questions is no. The passengers are your medical billing software vendors, you clearinghouses, your payers, and most importantly – your billers and coders.
If you haven’t started inquiring if these stakeholders and their systems will be ready before time, you could suffer from huge reimbursement disruptions once claims become dependent on these new codes. However, you still have time to get your engines running, and here’s what you need to do:
Contact your medical billing vendor
The first passenger on your train, irrespective of the number of trolleys you’re carrying, is your practice management (PM) or medical billing software vendor. This is because you need to inquire if your billing software is ready for the new codes. If not, you’ll not be able to get your claims through because they’ll contain defunct codes.
Additionally, you must also inquire if the vendor has a clear mapping process for ICD-10 conversion. If upgrades cost extra, or if you’ll need more training, you should have that in mind beforehand.
Lastly, ask them when you’ll be able to begin internal and external testing using these new codes, and if they have any recommendations for streamlining the process.
The debate rages on, despite the Department of Health and Human Services (HHS) issuing a rule finalizing Oct. 1, 2015, as the final date for ICD-10 implementation. Why? Because they said there would be absolutely no more delays last year. And the year before that. It’s kind of like a parent who doesn’t follow through with consequences in childrearing. If the child gets away with it once, they’re going to try again. I predict rages against the machine until midnight on Sept. 30, 2015.
I was in the field, one day into a two-day boot camp, in Connecticut. UConn had just made it into the Final Four, and the hotel bar was filled with revelers watching ESPN. I was in my hotel room, on the phone with my husband because the hotel didn’t have C-Span. He gave me a blow-by-blow count of the votes required until the SGR “doc fix” bill would pass because, at the last minute, the bill had been revised to include language affecting ICD-10 implementation.
If it passed, doctors’ reimbursements would not be cut by 24 percent, but ICD-10 would be delayed by at least a year. My husband is a surgeon, so we had a stake on both sides of the fence … or aisle, I suppose. Of course, it passed — it always passes. But what did that mean for all the people I’d taught in the past months, and what would that mean for the class I had to face the next morning, smack dab in the middle of their training? I expected to see my class members just as disheartened as I was and worried about the energy level of the second training day.
It turns out I didn’t even need to bring cookies. Nobody was disappointed. In fact, there seemed to be a collective sigh of relief. And these were the people I thought were ahead of the curve on implementation.
So, I took a poll:
Did they think people not ready for ICD-10 in 2014 would be ready in 2015?
Did they think people who were almost ready would spend the year getting extra-ready?
In May 2014, the Department of Health and Human Services released findings of their most recent study pertaining to reimbursement amounts provided to outpatient physicians for evaluation and management services. The study uncovered that Medicare overpaid outpatient physicians close to $7 billion and most improper payments were results of errors in coding and insufficient documentation (Table 1, highlights the percentage of claims that were wrongfully claimed for in 2010.). However this is not a problem isolated to physicians from the outpatient clinics, as physicians from inpatient clinics could also be found guilty of miscoding and insufficient documentation.
Recovery audit contractors (RACs) were created by the Medicare Modernization Act to evaluate the accuracy of Medicare claims. If a claim is determined by RAC to be flawed for any one of the many different reasons, the claim is denied. Although Medicare’s retrospective program of auditing bills is good, it is not perfect. There has been a huge spike in appeals of Medicare payment decisions, from hospitals mainly, since the introduction of the auditing program and delays in the appeal process has resulted in hospitals facing great financial difficulties as a lot of their funds are tied up till the appeal has been heard.
Adapted from : “Improper payments for evaluation and management services cost medicare billions in 2010”
In order to receive reimbursement from Medicare, a physician needs to follow a three-step process: 1) appropriate coding of the service provided by utilising current procedural terminology (CPT); 2) appropriate coding of the diagnosis using ICD-9 code; and 3) the Centers for Medicare and Medicaid Services (CMS) determination of the appropriate fee based on the resources-based relative value scale (RBRVS). It is not surprising that physicians often incorrectly code patient visits and procedures as there exists a truly daunting number of codes from which to choose. Moreover, coding structure and reimbursements schemes are constantly evolving and becoming more complex, resulting in a coding process that is often cumbersome and difficult.