E-mail this article to a friend  Download this article in PDF format

ICD-10 is Coming—Are You Ready?

Jackie Ryan and Jerry Winkelmann

The transition to 5010 may be settling down for your practice, but don’t get too comfortable! The next major transition—to the new International Classification of Diseases (ICD)-10 coding system—is coming, and it is going to be bigger than 5010.

Despite the fact that the U.S. Department of Health and Human Services recently proposed delaying ICD-10 compliance to Oct. 1, 2014, orthopaedic practices should continue to move forward with their ICD-10 preparations. The following information will help you develop a compliance plan for your practice.

What is ICD-10?
ICD-10 is the 10th updated edition of the ICD codes and will replace the United States’ current ICD-9 system. ICD-10 has the following two parts:

  • ICD-10-CM codes that providers assign to every medical diagnosis and description of symptoms for patients
  • ICD-10-PCS codes that designate procedures and are only used in the United States for inpatient hospital settings

Why make a change to ICD-10?
For several reasons, including the need for more codes and better data. The 30-year-old set of ICD-9 codes uses outdated terminology, lacks specificity, and is running out of room as hundreds of new diagnosis codes are submitted annually. Also, the United States is the only country that is still using ICD-9, and the switch to ICD-10 will enable more accurate comparisons of healthcare data with other countries. ICD-10’s more expansive system will also help the U.S. healthcare system better track data to measure the quality and safety of care, process claims for reimbursement, and improve clinical, financial, and administrative performance.

How many codes are in ICD-10?
ICD-10 has 141,000 codes—more than 8 times the 17,000 codes in ICD-9. The additional codes will enable practices to be more specific on claims forms in reporting the care provided to patients.

Is the switch to ICD-10 just for Medicare and Medicaid, or are other insurance companies changing too?
HIPAA mandates all health insurance companies that are covered entities make the transition to ICD-10. Workman’s compensation and property and casualty insurance companies are not covered entities.

Where can I find the ICD-10 code sets?
The ICD-10 code sets are available now, but they are in a draft form as codes will continue to be added prior to the transition deadline. The code sets are available free of charge on the Centers for Medicare & Medicaid Services website (www.cms.gov/icd10).

Once the transition occurs, the new code sets will be updated on an annual basis.

What ICD-10 related changes are of particular importance to orthopaedic practices?
The orthopaedic section of codes is expanding more than any other section of the new code sets. For example, in describing a diagnosis of adhesive capsulitis of the shoulder, ICD-9 had just one code (726.0). ICD-10 has three codes—adhesive capsulitis of unspecified shoulder (M75.00), adhesive capsulitis of right shoulder (M75.01), and adhesive capsulitis of left shoulder (M75.02).

Training is especially important to familiarize staff with these significant changes. In addition, orthopaedic practices may have a more challenging time with ICD-10 when it comes to Medicare. Orthopaedic treatment for many Medicare patients often includes the use of durable medical equipment (DME), in addition to physician services. For example, patients who have knee surgery and require ongoing therapy may take home a TENS machine or other DME equipment.

This equipment is billed differently than physician services. Therefore, orthopaedic offices and staff will need to submit ICD-10 codes for both Medicare Part A and Part B claims.

Why should I start preparing now for the ICD-10 transition when it’s likely it won’t happen until 2014?
The transition to ICD-10 is a major undertaking for providers, payers, and vendors. It will drive business and systems changes throughout the healthcare industry, from large national health plans to small medical offices, laboratories, medical testing centers, and hospitals. To ensure a smooth transition, these organizations need to devote staff time and financial resources to transition activities.

The cost of managing the ICD-10 transition could range from $84,000 to $2.7 million, depending on the size of a practice. This covers costs associated with education, process analysis, information technology services, super-bill changes, increased document numbers, additional staff needs, and overtime fees.

So, it’s best to develop a transition plan now, start preparing your financials, and begin training staff. If you are not ready to use ICD-10 codes by the deadline, claims and other transactions will be rejected and will need to be resubmitted with ICD-10 codes, thus affecting reimbursements and cash flow.

What will be the impact of the transition?
Even the best prepared office may run into problems directly following the transition. Be prepared to see a decrease in productivity and accuracy, as well as the need for additional training and education. Expect delays in claims processing and an increase in the number of rejected claims.

How are providers preparing?
During a recent webinar conducted by Gateway EDI (the company that powers the AAOS Revenue Management Program), participants were polled to determine how providers were preparing for the transition to ICD-10. Surprisingly, a third of respondents reported that they had not started any ICD-10 planning.

Only 1 percent of participants stated that they are securing a line of credit. According to Shelly Guffey, leader of the Gateway EDI ICD-10 Team, “The entire healthcare industry saw the impact 5010 had on cash flow, and it’s predicted that ICD-10 will have an even larger impact. It’s important for providers to have a line of credit ready just in case they need it.”

Holding off on making preparations until the final rule is released will put your organization in jeopardy and you will lose valuable preparation time. Instead, orthopaedic practices should use the extra time to analyze the areas within the practice that will be affected and adjust plans accordingly. The extra time can also be used to develop a more in-depth training plan.

The Workgroup for Electronic Data Interchange also recommends benchmarking practice claims processing metrics—such as average days in accounts receivable, first pass resolve rates, and number and type of rejections by each payer—now. Tracking current coding productivity, backlog, and accuracy is also recommended.

AAOS members should continue moving forward on preparations to implement ICD-10. Doing as much as possible now will save headaches as the deadline nears and will ensure continued efficient operations throughout the transition.

Need more help?
The AAOS has resources you can use. Subscribers to the AAOS Orthopaedic Code-X Software product should check recent editions of the Code X-tra newsletter, which provides medical record coding tips and conventions. The AAOS online Practice Management Center (www.aaos.org/pracman) has a page of resources on the transition to ICD-10, as does the AAOS Revenue Management Program powered by Gateway EDI (www.gatewayedi.com/icd10). In addition, the Centers for Medicare & Medicaid Services and the World Health Organization offer several training and planning resources. Links to all these resources are available in the online version of this article.

Jackie Ryan is the manager of the AAOS practice management group. She can be reached at ryan@aaos.org

Jerry Winkelmann is the Gateway EDI representative on the AAOS Revenue Management Program. He can be reached at jwinkelmann@gatewayedi.com

Where does your practice fall? (sidebar)

Additional Resources:

AAOS Now
July 2012 Issue
http://www.aaos.org/news/aaosnow/jul12/managing9.asp