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How Will ICD-10 Impact Your Revenue Cycle Management?


On October 1st, 2014, the official use of and mandatory transition into ICD-10 in the United States will commence. In addition, it will be split into two systems: ICD-10-Clinical Modifications (CM) (a system that uses unique alphanumeric category classifications for the first time, includes more than 68,000 diagnostic codes, and has twice as many categories as ICD-9-CM), and ICD-10 procedure coding system (PCS) (a system for inpatient hospital procedure coding).

ICD-10 implementation will radically change the way coding is currently done and will require a significant effort to implement. This massive overhaul of the national coding system, going from roughly 17,000 codes to about 140,000, will be the most significant change to health care in decades. For medical coders and billers, stronger clinical knowledge and a much greater understanding of anatomy will be required as well as a strong comprehension of ICD-10 coding. This is why it is more crucial than ever to employ knowledgeable certified coders as well as the support of an experienced Revenue Cycle Management Partner to ensure a seamless transition into this new code set. Converting to ICD-10 will impact almost every aspect of a provider’s operations, including patient services, care delivery, revenue cycle management, data analysis and reporting, as well as a number of information technology (IT) systems that use diagnostic and procedural information.

One critical operation that requires close attention is your revenue cycle management, including medical coding, billing, insurance claims processing and A/R management. Healthcare providers must determine if there is an opportunity to leverage the more specific capabilities of ICD-10 to achieve process optimization and more accurately reflect the services provided. You can harness the massive influx of data ICD-10 will generate to streamline processes and make smarter, more strategic business decisions to optimize your revenues cycle.

Eligibility and utilization management will need to be reconfigured, while medical necessity, policy checks and associated protocols will have to be updated to utilize ICD-10 codes.

To ensure the appropriate clinical documentation is in place, it is critical to conduct a thorough assessment of clinical documentation processes to identify situations in which additional data is needed to assign the appropriate ICD-10 code. The results of these assessments can be used to target clinical documentation improvement initiatives. Capturing the correct clinical documentation, including all relevant diagnostic data within the treatment record, will improve the quality of care, enable improved billing and cash flow, and improve both clinical and financial audit results.

Understanding how new ICD-10 codes align with existing ICD-9 reimbursement data will be critical to billing and coordination of benefits. The industry is bracing for an increased number of denials due to incongruities between the two coding systems. Denials may have several causes, such as improper eligibility checks or insufficient documentation for processing a claim. In order to manage against a spike in denials, providers will need to start analyzing the root causes of current denials and address process gaps.

How can your facility be prepared for this critical transition? The task is going to be overwhelming for ANY healthcare facility. One sure way to be prepared is to find an outsourcing partner who is already prepared and specializes in the ICD-10 transition process. They can help you with the following critical functions.

Medical coding, Training and Computer-assisted coding: What’s your average billing cycle time now? It could get worse.

Mistakes in coding or data entry can result in delayed or incorrect billing. That’s not a new problem, but the learning curve for the huge new coding system is sure to cause additional mistakes. That could be compounded in the short term, because your staff might have to manually double-check coding and billing to ensure it’s accurate according to the new standards.

ICD-10 is transforming the way you code and bill procedures but it’s also brought widespread changes and new standards for data transmission. You’re going to need new technology and modified office procedures, especially for details that affect the more stringent patient confidentiality regulations.

Due to the complexity of ICD-10 which encompasses a significant increase in codes, training is critical to successful implementation and process improvement.By the fall of 2014, all coders and healthcare professionals who use, read, and/or access codes will have to understand how to use it proficiently. To ensure compliance, staff will require extensive training on medical and diagnostic codes, while others will require training on diagnostic and procedure coding as well as anatomy and physiology. Proficiency in computer-assisted coding will become increasingly important. Staff members who do not presently have a high level of interaction with ICD codes will require a basic level of understanding so that they are aware of the changes that are being implemented and how these changes will impact the organization.

Impact analysis: Analyzing the financial impact due to the shift from ICD-9 to ICD-10 will play a critical role in effectively maintaining revenue integrity.

Testing: Because ICD-10 codes are not an exact one-to-one match with ICD-9, approximations and mismatches will affect reimbursement. Organizations must plan for end-to-end testing. It will be critical to test with IT vendors and clearinghouses in order to test the compliance of each product and transaction, and avoid downstream or upstream impact on business processes and reimbursements.

Although it will be a challenge, the transition to ICD-10 offers opportunities to improve clinical documentation, revenue cycle performance and business operations. Making the transition will require adequate time for assessing impacts to clinical documentation, business processes, IT and training. To meet these challenges and ensure timely compliance, select an experienced outsourcing partner and view ICD-10 as a strategic initiative to move your organization forward!

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