Flawed Implementation of ICD-10 Less than Six Months Away

*Editor’s Note: The following is a special editorial from Dr. Jeff Terry, past president of the Medical Association, who has closely followed ICD-10 and testified before Congress concerning the need to delay implementation to mitigate the negative effects on medical practices.

Bill in U.S. House Would #StopICD10

Rep. Ted Poe (R-Tex.), supported by six of his Republican colleagues including Rep. Mike Rogers (R.-Ala.) and Rep. Mo Brooks (R.-Ala.), has introduced a bill to block the government-mandated transition from ICD-9 to ICD-10 diagnostic codes set to take effect Oct. 1.

ICD-10 Switch Will Cause Problems in the ER

Researchers found 27 percent of the 1,830 commonly used emergency room ICD-9 codes had convoluted mappings that could create problems with reporting or reimbursement. Further, they found that when they looked at more than 24,000 actual clinical encounters in the ER, 23 percent could be assigned incorrect codes if recommendations of the Center for Medicare and Medicaid Services were followed.

State Lawmakers Urge Congress to Delay ICD-10

MONTGOMERY ─ An Alabama Senate Joint Resolution urging Congress to delay the mandated implementation of ICD-10 on Oct. 1 and lessen the burden on Alabama’s medical practices was enacted this week.

“The Centers for Medicare and Medicaid Services is forcing this unfunded mandate on the health care community, and it couldn’t come at a worse time,” SJR 79 sponsor Sen. Tim Melson, M.D. (R-Florence), said. “Physicians are already overburdened by federal reporting regulations, such as meaning use of electronic health records and the Physician Quality Reporting System that will straddle the ICD-10 start date of Oct. 1. Adding ICD-10 to the mix will only make matters worse for physicians who are only trying to treat their patients.”

If implemented on Oct. 1, the International Classification of Diseases and Related Problems, 10th Version (ICD-10), will replace the current ICD-9 system requiring physicians and their office staff to transition to a coding system with more than 68,000 diagnostic codes – four times more than ICD-9’s current 13,000 codes. Though other countries have adopted ICD-10, the U.S. is the only country planning to fully adopt ICD-10’s complete catalog of 68,000 diagnostic codes and tie it to a medical billing system.

Jeff Terry, M.D., a Mobile urologist and past president of the Medical Association, was the only physician to testify before a Congressional panel earlier this year that the implementation of ICD-10 could force doctors out of business and threaten patients’ access to medical care.

“The vast majority of America’s physicians in private practice are not prepared,” Dr. Terry told the U.S. House Energy and Commerce Health Subcommittee. “Physicians are overwhelmed with the tsunami of regulations that have significantly increased the work for our practices. Physicians are retiring early, which could leave countless numbers of patients without a doctor.”

Physicians widely agree the conversion to the new coding system will not improve patient care, but the overnight conversion to the new system could provide insurers with four times as many reasons to deny necessary medical services and procedures for patients because of coding errors.

“CMS is putting the computer between the doctor and the patient with ICD-10,” Sen. Larry Stutts, M.D., (R-Tuscumbia), co-sponsor of the resolution, said. “As we saw with the rollout of the federal health exchanges, there were a lot of technical problems. With CMS planning to implement ICD-10 on one single day, there are no guarantees we won’t see the same types of problems again. Thirteen thousand codes are already too many. Instead of adding more complicated coding we need to simplify the process.”

Transitioning to ICD-10 requires an abundance of costly and time-consuming education for physicians and staff, software, coder training, and equipment testing. This unfunded mandate will be most costly for private medical practices forced to pay $80,000 to $2.7 million to complete the transition.

Read more about Act 2015-279 and delaying implementation of ICD-10.

Association Supports Rep. Palmer’s ICD-10 “Grace Period” Bill

The Medical Association of the State of Alabama has endorsed H.R. 2652 by Congressman Gary Palmer (R-AL-06), which will protect patients’ access to care and lessen the burden on physicians, particularly in rural and smaller practices.

The “Protecting Patients and Physicians Against Coding Act” would give physicians a two-year grace period in which they would not be penalized for errors with the new federally mandated ICD-10 system that’s used to document code medical procedures and services. ICD-10 contains more than four times the codes used with ICD-9. For physicians, more time spent poring over tens of thousands of medical codes during a patient’s visit equates to less quality time with that patient.

“We are very concerned about the ICD-10 mandate,” George “Buddy” Smith Jr., M.D., president of the Medical Association, said. “Not only does it not improve patient care, but it may provide insurers four times as many reasons to deny necessary medical services and procedures because of coding errors.”

John Meigs, M.D., a family physician from Centerville and a member of the Medical Association’s Board of Censors, said he anticipates serious problems if H.R. 2652 is not adopted.

“The new coding system does nothing for patients or doctors. It’s for insurance companies and bean counters,” said Dr. Meigs. “It will get in the way of the care patients in rural areas badly need. There hasn’t been much in terms of a trial run. To avoid serious disruptions, there’s going to need to be a grace period where physicians get a chance to get used to this new system.”

Congressman Palmer thanked the Medical Association for supporting his bill, the “Protecting Patients and Physicians Against Coding Act.”

“Physicians and other health care providers are in the business to provide care, not to master a complicated and burdensome federally mandated coding system,” Congressman Palmer said. “Protecting patient access to health care is very important. Rural areas and small towns are most at risk from the implementation of ICD-10, practitioners in those areas with smaller practices tend to have fewer resources and they rightly focus on patient care instead of government coding. Because of this, I offered an amendment to recent to legislation delay ICD-10’s implementation. Unfortunately, the amendment was not accepted.”

ICD-10: 75 Days and Counting

UPDATE July 17, 2015: ICD-10: 75 Days and Counting

Medical Association asks all health plans in Alabama to provide a One-Year “grace period”

Only 75 days remain until ICD-10 is scheduled for implementation but a step in the right direction was taken last week by CMS in announcing a 12-month grace period for physician coding errors in Medicare claims. This move by CMS is a direct result of pressure put on the agency from state medical associations nationwide and from members of Congress like Rep. Gary Palmer, who introduced a bill in the U.S. House with a similar grace period.

“While the Medical Association has been an outspoken opponent of ICD-10 and remains so, the inclusion of a grace period makes this federal mandate less problematic for medicine,” Medical Association President Buddy Smith, M.D., said.

Not 48 hours after breaking the news to Alabama doctors about the ICD-10 grace period, Dr. Smith penned a letter to all Alabama health plans and payers asking them to also provide a 12-month “grace period” for coding errors.

“While there are still many details to be worked out, this week’s announcement is a good start, and we will ask private payers and Alabama Medicaid to follow those same transition-period guidelines,” Dr. Smith wrote.

The Medical Association has been one of ICD-10’s most outspoken opponents, taking to the public and media examples of just some of the ridiculously specific codes that make up ICD-10.

Despite the controversy surrounding ICD-10, there has been room to poke a little fun at the hyper-specific coding system that includes some weird and obscure codes for bizarre medical injuries. There’s even an illustrated book, Struck by an Orca: ICD-10 Illustrated.

Additionally, the Association has been on the front lines educating members of Congress about the real-world effects ICD-10 will have on medical practices in Alabama.

“The new coding system does nothing for patients or doctors. It’s for insurance companies and bean counters,” John Meigs, M.D., a family physician from Centerville and a member of the Medical Association’s Board of Censors, said. “It will get in the way of the care patients in rural areas badly need. There hasn’t been much in terms of a trial run. To avoid serious disruptions, there’s going to need to be a grace period where physicians get a chance to get used to this new system.”

But the Association also employed educational and advocacy efforts closer to home with state lawmakers as well, especially in the Association-supported Alabama Senate Joint Resolution by Senators Tim Melson, M.D. and Larry Stutts, M.D.

However, not all physicians see ICD-10 as a problem and claim no outrageous expenses or ill effects on their practices during the transition, according to one news service.

“We did not have special training,” Edward M. Burke, M.D., of the Beyer Medical Group in Missouri, told the House subcommittee in February and reported in HCPRO online. “We did not spend ANY money in preparation. We did not see less patients, and our practice did not suffer. As providers, it was not frustrating or scary. It just was.”

To be clear, the Medical Association still opposes implementation of ICD-10 on Oct. 1, as Dr. Smith said, the grace period is “a good start.” However, we still have much work left to do, including preparing for the implementation in 75 days that no one wants to do. As well, questions remain, particularly regarding the grace period’s coverage of services provided by hospital-based physicians. The Association is asking CMS for guidance in this area and will provide that information to our members as soon as it becomes available.

Additionally, here are some other resources that may help in preparations for ICD-10:

• ICD-10 Quick Start Guide
• CMS’s “Road to 10” (tool to create customized action plans)
• CMS’s main site for ICD-10

The Medical Association will present “Update on ICD-10 and Quality Measures” on Saturday, Aug. 22, at Embassy Suites in Birmingham-Hoover. Register online here.

UPDATE July 8, 2015: Not 48 hours after breaking the news to Alabama doctors about the grace period, Medical Association President Buddy Smith, M.D., penned a letter to all Alabama health plans and payers asking them to also provide a 12-month “grace period” for coding errors.

“While the Medical Association has been an outspoken opponent of ICD-10 and remains so, the inclusion of a grace period makes this federal mandate less problematic for medicine,” Dr. Smith wrote. “… the Medical Association is requesting that all health care payers and health plans in the state of Alabama adhere to and adopt the most recent guidelines from CMS regarding a grace period for physician ICD-10 coding errors …”

Between our work with the Alabama Congressional Delegation to build support for Rep. Gary Palmer’s legislation calling for an ICD-10 grace period to passage of the Alabama Senate Joint Resolution requesting a penalty-free transition for doctors to the request that all Alabama health plans and payers also provide a grace period, the Medical Association has worked tirelessly to mitigate the negative impact that ICD-10 may have on medical practices and patient care.

UPDATE July 6, 2015: Responding to mounting pressure from physicians’ groups and Congress, the Centers for Medicare & Medicaid Services announced it will allow additional flexibility for physicians as they transition to ICD-10 on Oct. 1, beginning with a one-year reprieve from coding error penalties.

“The Medical Association has been on the ICD-10 front lines for a very long time,” George “Buddy” Smith Jr., M.D., president of the Medical Association, said. “While there are still many details to be worked out, today’s announcement is a good start, and we will ask private payers and Alabama Medicaid to follow those same transition-period guidelines.”

Dr. Smith noted the Association has worked with the Alabama Congressional Delegation and state officials on ICD-10 to find any way possible to mitigate the effects of the unfunded mandate on medical practices. In fact, the recent American Medical Association resolution calling for a ‘grace period’ was championed by Alabama physician Dr. Jeff Terry.

Today’s announcement addresses the following areas:

• Claim denials. For the first year, Medicare claims will not be denied solely based on the specificity of the diagnosis codes as long as they are from the appropriate family of ICD-10 codes. Medicare will not deny payment for these unintentional errors as practices become accustomed to ICD-10 coding. Medicare claims will not be audited based on the specificity of the diagnosis codes as long as they are from the appropriate family of codes. This transition period will give physicians and their practice team’s time to get up to speed on the more complicated code set. Medicare Administrative Contractors and Recovery Audit Contractors will be required to follow this policy.
• Quality-reporting penalties. Similar to claim denials, CMS will not subject physicians to penalties for the Physician Quality Reporting System, the value-based payment modifier or meaningful use based on the specificity of diagnosis codes as long as they use a code from the correct ICD-10 family of codes. Penalties will not be applied if CMS experiences difficulties calculating quality scores for these programs as a result of ICD-10 implementation.
• Payment disruptions. If Medicare contractors are unable to process claims as a result of problems with ICD-10, CMS will authorize advance payments to physicians.
• Navigating transition problems. CMS has said it will establish a communication center to monitor issues and resolve them as quickly as possible. This will include an “ICD-10 ombudsman” devoted to triaging physician issues.

Free help solutions include “Road to 10” primers aimed at smaller physician practices with clinical documentation, clinical scenarios, and other specialty-specific resources to help with implementation, as well as training videos for other helpful tips.

See also ICD-10 Guidance to help you get ready for ICD-10.

More Q&As Regarding ICD-10 Guidance and Flexibilities

On July 6, 2015, the Centers for Medicare & Medicaid Services (CMS) and the American Medical Association (AMA) released a joint statement about their efforts to help the provider community get ready for ICD-10. This statement included guidance from CMS that allows for flexibility in the claims auditing and quality reporting processes.

In response to questions from the health care community, CMS has released “Clarifying Questions and Answers Related to the July 6, 2015 CMS/AMA Joint Announcement and Guidance Regarding ICD-10 Flexibilities,” which provides answers to the most commonly asked questions.

Q: When will the ICD-10 Ombudsman be in place?

A: The Ombudsman will be in place by Oct. 1, 2015.

Q: Does the guidance mean there is a delay in ICD-10 implementation?

A: No. Medicare claims with a date of service on or after Oct. 1, 2015, will be rejected if they do not contain a valid ICD-10 code. The Medicare claims processing systems do not have the capability to accept ICD-9 codes for dates of service after Sept. 30, 2015, or accept claims that contain both ICD-9 and ICD-10 codes for any dates of service. Submitters should follow existing procedures for correcting and resubmitting rejected claims.

Q: What is a valid ICD-10 code?

A: ICD-10-CM is composed of codes with 3, 4, 5, 6 or 7 characters. Codes with three characters are included in ICD-10-CM as the heading of a category of codes that may be further subdivided by the use of fourth, fifth, sixth or seventh characters to provide greater specificity. A three-character code is to be used only if it is not further subdivided. To be valid, a code must be coded to the full number of characters required for that code, including the 7th character, if applicable. A complete list of the 2016 ICD-10-CM valid codes and code titles is posted on the CMS website.

Q: What should I do if my claim is rejected? Will I know whether it was rejected because it is not a valid code versus denied due to a lack of specificity required for a NCD or LCD or other claim edit?

A: Yes. Submitters will know if a claim was rejected because it was not a valid code versus a denial for lack of specificity required for a NCD or LCD or other claim edit. Submitters should follow existing procedures for correcting and resubmitting rejected claims and issues related to denied claims.

Q: What is meant by a family of codes?

A: “Family of codes” is the same as the ICD-10 three-character category. Codes within a category are clinically related and provide differences in capturing specific information on the type of condition. One must report a valid code and not a category number. In many instances, the code will require more than 3 characters to be valid.

Q: Does the recent guidance mean no claims will be denied if they are submitted with an ICD-10 code that is not at the maximum level of specificity?

A: In certain circumstances, a claim may be denied because the ICD-10 code is not consistent with an applicable policy, such as Local Coverage Determinations or National Coverage Determinations. (See Question 7 for details). This reflects that current automated claims processing edits are not being modified as a result of the guidance. In addition, the ICD-10 code on a claim must be a valid ICD-10 code. If the submitted code is not recognized as a valid code, the claim will be rejected. The physician can resubmit the claims with a valid code.

Q: National Coverage Determinations (NCD) and Local Coverage Determinations (LCD) often indicate specific diagnosis codes are required. Does the recent guidance mean the published NCDs and LCDs will be changed to include families of codes rather than specific codes?

A: No. For 12 months after ICD-10 implementation, Medicare review contractors will not deny physician or other practitioner claims billed under the Part B physician fee schedule through either automated medical review or complex medical record review based solely on the specificity of the ICD-10 diagnosis code as long as the physician/practitioner used a valid code from the right family of codes. The Medicare review contractors include the Medicare Administrative Contractors, the Recovery Auditors, the Zone Program Integrity Contractors, and the Supplemental Medical Review Contractor. The recent guidance does not change the coding specificity required by the NCDs and LCDs. Coverage policies that currently require a specific diagnosis under ICD-9 will continue to require a specific diagnosis under ICD-10. It is important to note these policies will require no greater specificity in ICD-10 than was required in ICD-9, with the exception of laterality, which does not exist in ICD-9. LCDs and NCDs that contain ICD-10 codes for right side, left side, or bilateral do not allow for unspecified side. The NCDs and LCDs are publicly available and can be found here.

Q: Are technical component only and global claims included in this same CMS/AMA guidance because they are paid under the Part B physician fee schedule?

A: Yes, all services paid under the Medicare Fee-for-Service Part B physician fee schedule are covered by the guidance.

Q: Do the ICD-10 audit and quality program flexibilities extend to Medicare fee-for-service prior authorization requests?

A: No, the audit and quality program flexibilities only pertain to post payment reviews. ICD-10 codes with the correct level of specificity will be required for prepayment reviews and prior authorization requests.

Q: If a Medicare paid claim is crossed over to Medicaid for a dual-eligible beneficiary, is Medicaid required to pay the claim?

A: State Medicaid programs are required to process submitted claims that include ICD-10 codes for services furnished on or after Oct. 1 in a timely manner. Claims processing verifies that the individual is eligible, the claimed service is covered, and that all administrative requirements for a Medicaid claim have been met. If these tests are met, payment can be made, taking into account the amount paid or payable by Medicare. Consistent with those processes, Medicaid can deny claims based on system edits that indicate that a diagnosis code is not valid.

Q: Does this added ICD-10 flexibility regarding audits only apply to Medicare?

A: The official guidance only applies to Medicare fee-for-service claims from physician or other practitioner claims billed under the Medicare Fee-for-Service Part B physician fee schedule. This guidance does not apply to claims submitted for beneficiaries with Medicaid coverage, either primary or secondary.

Q: Will CMS permit state Medicaid agencies to issue interim payments to providers unable to submit a claim using valid, billable ICD-10 codes?

A: Federal matching funding will not be available for provider payments that are not processed through a compliant MMIS and supported by valid, billable ICD-10 codes.

Q: Will the commercial payers observe the one-year period of claims payment review leniency for ICD-10 codes that are from the appropriate family of codes?

A: The official guidance only applies to Medicare fee-for-service claims from physician or other practitioner claims billed under the Medicare Fee-for-Service Part B physician fee schedule. Each commercial payer will have to determine whether it will offer similar audit flexibilities.

Physicians Not Ready for ICD-10, New Survey Says

Nearly 25 percent of physicians’ offices will not be ready when ICD-10 is implemented Oct. 1, and another 25 percent are unsure of their state of readiness, according to a new survey by the Workgroup for Electronic Data Interchange (WEDI), the nation’s leading nonprofit authority on the use of health information technology.

Alabama Medicaid to Honor Physician ICD-10 ‘Grace Period’ for Coding Errors

In response to a request from the Medical Association, Alabama Medicaid will not penalize physicians for coding errors under ICD-10 as long as a valid ICD-10 code from the correct “family of codes” is used. This follows a similar policy by CMS for Medicare Part B claims announced in early July.

“The inclusion of a transition or ‘grace period’ is significant as we believe that Alabama physicians and medical practices are not yet fully prepared for the switch from ICD-9 to ICD-10,” Association President Dr. Buddy Smith wrote in his letter to all health plans and insurers in Alabama requesting they follow the CMS guidelines for a coding error grace period. “While the Medical Association has been an outspoken opponent of ICD-10 and remains so, the inclusion of a grace period makes this federal mandate less problematic for medicine.”

In summary, while Alabama Medicaid will implement ICD-10 on Oct. 1, the Agency will allow a grace period during which physicians will not be penalized for ICD-10 coding errors as long as the ICD-10 code used is in the same “family of codes.”

A “family of codes” is the same as the ICD-10 three-character category. Codes within a category are clinically related and provide differences in capturing specific information on the type of condition. However, the code may require more than three characters to be valid.

To date only Medicare Part B, Blue Cross and Blue Shield of Alabama and Alabama Medicaid have granted a “grace period.”

Alabama Medicaid has more information about ICD-10 implementation and readiness details here. Even more information about ICD-10 readiness can be found in our ICD-10 Physician Resource Center.

Last Minute ICD-10 Items

Despite our best efforts, ICD-10 will be implemented Oct. 1, 2015.

No more delays. It’s going to happen next Thursday, Oct. 1, ready or not. Here comes ICD-10. While the Medical Association has been and remains an opponent of the forced switch to ICD-10, we fought it and in 2014 got a one-year delay. We continued fighting the mandated ICD-10 changeover in 2015, but when it became evident it would be implemented we worked diligently to soften the landing as much as possible.

In short summary, regarding ICD-10, the Association:

• Worked with the Alabama Congressional Delegation and chiefly Rep. Gary Palmer (R-AL 6) on his legislation to delay implementation even though the powerful forces of the tech, software and data processing industry overpowered us;
• Provided testimony to Congressional committees about the real world effects on medical practices through our late anti-ICD-10 champion Dr. Jeff Terry of Mobile, where Dr. Terry was often the lone voice opposing the mandated switch;
• Successfully ushered a joint resolution through the Alabama Legislature asking Congress for delay of or funding for medical practices in order to implement ICD-10;
• Worked with the media to raise awareness of the public to the unnecessary switch from ICD-9 to ICD-10 at this time;
• Successfully petitioned several health insurance entities including Medicare Part B, Alabama Medicaid, Blue Cross Blue Shield of Alabama and VIVA HEALTH to provide some form of grace period for ICD-10 physician coding errors; and,
• Provided CME opportunities on ICD-10 to help medical practices prepare for the transition.

Additionally, the Medical Association has compiled significant amounts of useful information on the ICD-10 transition. For more information about ICD-10 preparedness, check out the ICD-10 Physician Resources in the NewsCenter.