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The Bottom Line of ICD-10

Rural Hospital Finance Workshop

August 2013

Address Technology and Healthcare Reform Initiatives

Cov Policies

AHRQ

RACs

Exchanges

ICD-10

MU

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What is ICD-10?

10th version CM (Clinical

Modification)

PCS (Procedure

Coding System)

Captures/Describes Diagnoses Procedures

Type of encounter utilizing ALL encounters report (hospital, physician, home health, SNF, hospice)

Inpatient only (hospital)

Type of Bill (TOB) Any/all bill types Inpatient only (11X) Part A (Inpatient)

Who uses All industrialized nations USA (CMS developed) Other countries develop their own unique procedure set

The Value of ICD-10

• Improved ability to measure the quality, efficacy, and safety of patient care

• Increased sensitivity when refining grouping and reimbursement methodologies

• Enhanced ability to conduct public health surveillance

• Greater achievements and benefits within the (anticipated) EHR implementation

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Details expanded

• Laterality

• Type – traumatic/pathologic

• Specific site/bone

• Type of encounter

Fractures

• STEMIs – specific coronary artery and wall

• Timeline of diagnosis (within 4 weeks)

• Subsequent MI within specified timelines MI

• Mild intermittent

• Mild persistent

• Moderate persistent

• Severe

Asthma

Nontraumatic intracerebral hemorrhage

ICD-9 ICD-10

431 – Intracerebral Hemorrhage (basilar, bulbar, cerebellar, cerebral, cerebromeningeal, cortical, internal capsule, intrapontine, pontine, subcortical, ventricular)

I61.0 – Nontraumatic intracerebral hemorrhage in hemisphere, subcortical I61.1 - Nontraumatic intracerebral hemorrhage in hemisphere, cortical I61.2 - Nontraumatic intracerebral hemorrhage in hemisphere, unspecified I61.3 - Nontraumatic intracerebral hemorrhage in brain stem I61.4 - Nontraumatic intracerebral hemorrhage in cerebellum I61.5 - Nontraumatic intracerebral hemorrhage, intraventricular I61.6 - Nontraumatic intracerebral hemorrhage, multiple localized I61.8 – Other nontraumatic intracerebral hemorrhage I61.9 – Nontraumatic intracerebral hemorrhage, unspecified

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PCS (inpatient procedure) content Section (Medical – Surgical – Ancillary)

Body System – (GI, Endocrine, Lower joints)

Root Operation – (Objective of procedure)

Body Part (Stomach, Adrenal gland, Femur)

Approach – (Open, closed, percutaneous)

Device (left in after surgical procedure)

Qualifier

What a difference the Objective makes

• Internal fixation right radial fx

– Insertion

– 0PHH04Z

• ORIF right radial fx

– Reposition

– 0PSH04Z

Root Operation

Objective of Procedure

Site of Procedure Example

Insertion (H) Putting in non-biological device

In/on a body part Central line insertion Internal Fixation (w/o reduction)

Reposition (S) Moving to normal location or suitable location

Some/all of a body part

Reduction displaced Fx (ORIF w/ device) Orchiopexy for undescended testes

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Detailed and Specific Body Parts

Encounter

ICD-9 ICD-10

Laceration of the digital artery on the right index finger - received sutures

39.31 Suture of Artery 03QD0ZZ Repair right hand artery, open approach

Chest stab wound – laceration of the thoracic aorta requiring an open chest procedure to suture the aorta

39.31 Suture of Artery 02QW0ZZ Repair Thoracic Aorta, open approach

Device – 6th Character includes…..

Device Example

Autologous Internal mammary artery, skin graft

Non-Autologous BMP, allogenic bone/skin graft,

Synthetic device Hip/knee replacement, artificial heart valve

Extraluminal Ligation fallopian tube using band/falope ring

Intraluminal Drug Eluting Stent, Coil embolization intracranial artery

Monitoring Implantable CV monitor, loop recorder

Radioactive Radioactive implants/seeds

Draining GB drainage tube

Infusion VAD, Implantable infusion pump

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ICD-10 expectations

ICD-10 Transition Training Hospital staff & Physicians

If you don’t know where you need to be,

you won’t get there on time.

Establish a solid performance baseline

• Inventory of Coders’ knowledge

• Identify weakness/strengths

• Recognize educational needs

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Coding Staff - What fits?

• Pro - Economical

• Con – Internal staff may not have teaching qualities

Internal – Train the Trainer

• Pro – Optimal learning environment - interaction with instructor and fellow students

• Con – Travel Face to Face

• Pro – Volume discounts

• Con – limited interaction Web Based

• Pro – Self paced

• Con – No interaction Virtual Library

Non-Coding Staff

• Registration and pre-auths

• QI and data retrieval

• Ancillary and medical necessity

• Case managers/UR and DRG/admit criteria

• Billing staff and UB claims

• CFO with contract negotiations

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Conduct Documentation Integrity Audit

• Compare provider documentation to detail required for coding with ICD-10-CM and PCS

• Identify weaknesses

• Work with physician leader/liaison/coding manager team to develop physician awareness and education

– Documentation education is based on review findings

Documentation Strategies

• Education

• Additional Queries

– Retrospective approach

• Clinical Documentation Improvement

– Prospective approach

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Physician Education

who what

when how

• Internal or External

Who will be communicating

• Med Staff meetings, newsletters, email, increased queries

• Specialty specific

Where /How will communication occur

• Documentation affects more than just coding (quality, SOI, ROM, patient safety)

Why communication is necessary

• Be consistent with information.

What will be the message

• NOW!!!!!

When will communication begin

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Why is ICD-10 necessary?

• Technology and Healthcare Reform Initiatives

• Support medical necessity

• Administrative and reimbursement effects

• Minimize payer audits

• Ensure strong reputation through profiling

• Improve patient care

• …..Common denominator

Documentation Profiling

Reimbursement

Medical Necessity

Patient Care

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Work Force Influence • Workforce availability

– Internal staffing

• Consider additional staff

• Job descriptions or responsibilities may change

• Job transitions – greener pastures

• Aging workforce

– Knowledgeable outsource agencies as backup

• How to address tenured employees that fall behind

Mitigation – Wages and Benefits

• Cover ICD-10 Training costs

– A&P as well as Hands-on ICD-10

• Education AND practice on work time

• Consider wages differences to/for:

– Competitive salaries to maintain valued staff

– Internal ICD-10 trainer

• Fellow HIM , Hospital, AND Physicians

– New hire with ICD-10 training

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Other Workforce mitigations • Will you consider Training Agreements?

– Must obtain education by 0X-XX-14

– Must maintain employment for XX or risk educational funding

• Revise Job Descriptions to capture new skill expectations

• Ensure personnel records reflect ICD-10 competency

Quality and Productivity

• Practice learned skills – Where to find that time?

• Are the Codes Correct or Close? Audit to validate quality

• Consider Technology to assist with productivity – Computer Assisted Coding (CAC)

• Proficiency standards post implementation

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Prepare – prepare - prepare • Identify and schedule education needs

(on/off worktime)

• Identify documentation elements

• Invest in and value your Staff

– Identify workforce needs

• Utilize data to tell your story

• Practice ICD-10 coding to enhance learning

• Dual and/or Double coding

Address Timelines or Metrics

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Assess •Impact/Gap Analysis and Roadmap

•Scope

Design •Project Plan

(comprehensive)

•Budget

•Predictive financial analysis

Construct •Perform upgrades,

begin training

•Vendor management

•SME Development

Implement •Integrated testing

•Intermediate/advanced Education

Operationalize

•Live in an I-10 world

Assess/Monitor

•Focus on productivity, margin, workflows

Implementation Continuum

Where Are You on the Continuum?

Assess •Impact/Gap Analysis and Roadmap

•Scope

Design •Project Plan

(comprehensive)

•Budget

•Predictive financial analysis

Construct •Perform upgrades,

begin training

•Vendor management

•SME Development

Implement •Integrated testing

•Intermediate/advanced Education

Operationalize

•Live in an I-10 world

Assess/Monitor

•Focus on productivity, margin, workflows

Implementation Continuum

Where Should You Be?

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Where to Focus Effort Today

Stakeholder

Readiness

Testing

Financial & Operational

Neutrality

I C D 10

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Stakeholder Readiness

• Collaboration is the ONLY option

– Communicate early and often and establish a key contact that is responsive

– Review contracts/service agreements and assess potential cost and risk

• Payers: Start with largest contracted payers

• Vendors: Start with EHR/Practice Management/Encoder

• Clearinghouse: Should be your ally

• Other Stakeholders?

Required Answers

• What is your timeline?

• What is your testing plan?

• What is your contingency plan?

• Payer readiness questionnaires should capture key information for business decisions and tracking.

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• Natively coded

Not mapped, cross-walked or translated

• “the old-fashioned” method of coding using books and guidelines

• Dual coded

Patient record coded in both ICD-9 and ICD-10

• Direct testing

Direct exchange of data between hospital or clinic and payer

Common Industry Testing Terms

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Common Industry Testing Terms • Scenario based testing

Using sub-set of scenarios (not always medical record based) often provided by payer

• End to End testing

Mimics production, simulates entire business cycle

• Asynchronous testing

Non-linear testing with all stakeholders, typically using real medical record data

Example: HIMSS Pilot

What is the Purpose of E2E Testing?

End-to-End testing is a focused process within a defined area, using new or revised applicable products, operating rules or transactions, throughout the entire business and/or clinical exchange cycle, for the purpose of measuring operational predictability and readiness.

The End-to-End testing process should be performed in an environment which mirrors actual production as closely as possible, confirming the validation of performance metrics and analytics (reporting).

Source: National Government Services, 2013

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Internal Testing

Sandbox Environment (replicating production)

• Internal “IT end to end testing” for the build: – Application Functional/Unit Testing

• Application specific workflow test scripts and build/upgrade validation until error free

– Integrated Testing • Test scripts to include all systems, reports, registries and

websites impacted by ICD-10 build/upgrade

– User Acceptance Testing • End users will validate integrated workflows, technical set-

up, configuration and output following build/upgrade

Defining Your Test Data/Scenarios • Financial and operational analysis of encounter

data will drive testing scenario requirements

Consider your data

Total % of Risk

Unique Dx

Codes

Total Dx Codes

2000 300 Risk

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Defining Your Test Data/Scenarios

• Analyze your data and use SMEs

– High volume

– High cost/revenue

– High complexity (multiple points for failure)

• Could be very low volume

– Targeted opportunities for process improvement

– Targeted opportunities based on contract review

• P4P, Medicare Advantage HCC, Carve outs

“External” Testing Landscape • HIMSS ICD-10 pilot: April – August 2013

• Initial Lessons Learned:

– Coding accuracy 60 - 70%

– Payers using outdated version of ICD-10 code set

– 200 natively coded claims testing across 200 stakeholders

– Full results to be released in September

• Scenarios available for public use

– You will not be able to test with all payers – Pareto approach

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Medicare and Medicaid

• Medicare currently has NO plan to test with industry stakeholders

– Pressure is mounting

• Wisconsin Medicaid plans to test in summer 2014

– Stay tuned for details

Business Readiness Testing

• Operational neutrality:

– Ensuring clinical and business processes have been thoroughly tested for downstream success

• Workflows, forms, registries, reports, registration, authorizations, business rules and edits, data, etc.

• Financial neutrality:

– Ensuring revenue neutrality is maintained across lines of business, payers, DRGs, etc.

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Focus on The Financials

Revenue

& Reimbursement

Managed Care

Contracts

Cash Flow

Future

Risk

Revenue and Reimbursement

• Considerations:

– Direct translations (mapping, crosswalks, GEMS)

• Uniformity and consistency

– Payer coverage decisions

• Data is “power”, grace period length

– Contracts

• DRG, P4P, quality measures

– HIM, CDI and documentation impact

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Cash Flow Considerations

• Rejection rates may increase initially

• Claims may be pended for manual processing

• Payers may not be ready or have an unforeseen circumstance

• Decreased productivity

• Type of stakeholder dependency

• CMI

CMS DRG Shift Analysis Report • Based on DRG Grouper Version 30

Results:

– Slightly more than 99% of cases showed no change in MS-DRG when coded with ICD-10

– Of the 1% with shift, 45% shifted higher and 55% shifter lower

– Net change to all MS-DRG shifts was -0.04%

Source:

ttp://www.cms.gov/Medicare/Coding/ICD10/ICD-10-MS-DRG-Conversion-Project.html

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Managed Care Contracts

• Revenue impact and protection

• Cash flow impact and protection

• Pay for performance and quality terms

• Claims adjudication edits

• Testing provisions

• Interest and timely filing

• Exit strategy

• Coding accuracy

• Encoder accuracy

• Overall system functionality

• Billing accuracy

• Clearinghouse translation

• Payment accuracy

• Provider contract adherence

• Medical policy adherence

• HIPAA EDI compliance

Key Performance Testing Indicators

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• Post October 1, 2014 surveillance

• Metric monitoring and intervention to improve when necessary

• Episodic payments

• Data, data, data

• Ongoing documentation improvement

• Staff retention

Identifying Future Risk

The Impact on Quality and Other Reporting

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ICD-10: A Health Care Priority by Robert

Tagalicod, Director, Office of E-Health Standards and Services

• ICD-10 Advances Healthcare and the Implementation of eHealth Initiatives

• ICD-10 Captures Advances in Medicine and Medical Technology

• ICD-10 Improves Data for Quality Reporting

• ICD-10 Improves Public Health Research, Reporting, and Surveillance

Part of Achieving Healthcare’s ‘Triple Aim’

•Achieved by leveraging data that is improved by ICD-10

•Allows providers to adhere to evidence-based medicine, analyze gaps in care, discover disparities in appropriate use and cost (value)

•Provides greater performance transparency

•If an organization is going to achieve the Triple Aim, they must have a successful ICD-10 implementation

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Components of Care • ICD-10

• Quality reporting

• Third party audits

Scheduling and Registration

• Detailed clinical information is needed in the EHR to be coded at the onset, during and after care for quality reporting and to support claims submitted

Coordination of Care

• ICD-10 and third party audits will not inherently change care

• CMS “aims” to do that through Quality Reporting Delivery of Care

• Quality reporting and ICD-10 will necessitate and drive similar changes to the EHR

• ICD-10 will prompt further enhancements in documentation practices

• Will facilitate gathering of “meaningful” clinical information on the front end

Documentation of Care

Components Post Care • Clear and concise documentation in an EHR is critical to code assignment

• Quality reporting development will rely on accurate coding

• Accurate coding is needed for scrutiny by third party auditors Coding

• Dependent on timely, accurate documentation and coding

• Avoids increase in DFNB holds, timely filing limits, claim acceptance and adjudication issues

• Organizations struggling with claims submission will most likely struggle with quality reporting challenges

Claim Submission and Adjudication

• Decrease for failure to report quality measures

• Underpayment for failure to report payer contracts

• Inpatient DRG shifts

• Denials

• Increased third party audit activity

Reimbursement

• Financial

• Public

• Research

• WHA information Center data sets and publications

• Quality/VPB

• Public health

• Wisconsin Health Information Organization

Reporting

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Meaningful Use

• Goal: Patient Quality

• Components – Use of the system in a

“meaningful manner”

– Use of the system for electronic exchange of health information to improve quality

– Use of the system for submission of data related to quality

• Incentives and penalties

ICD-10

• Goal: Accurate Payment and Patient Quality

• Components – Increased specificity

– Improved documentation

• No incentives but penalties are far-reaching – Expected “DRG shift”

– Medical necessity denials

– Adjudication mishaps

– Inaccurate reporting

Quality Measures and the EHR

• Goal: Aggregated data through a vendor or submit from the EHR

• Components – Inpatient Quality Reporting

– Outpatient Quality Reporting

– Physician Quality Reporting

• Incentives and penalties for all – push to submit from the EHR

Quality Measures and ICD-10

• Goal: ICD-10 codes must be used to report quality measures on all applicable claims with dates of discharge on and after October 1, 2014

• Components – NQF, CMS and The Joint

Commission working together to align measures

• Penalties – MU, HIPAA

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ICD-10 Definitions Change

Examples of Change

Pressure Ulcers

• ICD-9 – two sets of codes

• ICD-10 – single code, more codes for location and laterality

Myocardial Infarction

• ICD-9 – acute = <= 8 weeks

• ICD-10 – acute = <= 4 weeks

• New code for 2nd acute infarct

Inpatient Procedures

• Approach

• Location

• Device use

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National Quality Forum – What is NQF’s Role in the Transition?

• Ensure all NQF-endorsed measures have a set of ICD-10 CM/PCS codes on October 1, 2014 – Via annual updates and 3-year maintenance reviews

• Provide measure developers with recommendations and best practices for transitioning quality measures to ICD-10-CM/PCS – 2009 Expert Panel and report

• Connect developers to transition resources as needed – AHIMA/other developers

Who Is Using this Approach?

• CMS

• AHRQ – Quality Indicators

• HEDIS

• Joint Commission

• WHA Information Center

ICD-10-CM/PCS Coding Maintenance Operational Guidance

Available now on NQF Website at: http://www.qualityforum.org/Publications/2010/10/ICD-10-CM/PCS_Coding_Maintenance_Operational_Guidance.aspx

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Recommended Conversion Best Practices

Convene Clinical and

Coding Experts

Determine Intent

Use Appropriate

Conversion Tool

Assess for Material Change

Solicit Stakeholder Comments

Assess for Material Change

CMS Measures • Physician Quality Reporting System

– http://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/PQRS/MeasuresCodes.html

• Hospital Inpatient Quality Reporting Measures – https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-

Instruments/HospitalQualityInits/HospitalRHQDAPU.html

• Hospital Outpatient Quality Reporting Measures – https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-

Instruments/HospitalQualityInits/HospitalOutpatientQualityReportingProgram.html

– Accepting informal public comments until 8/31/13

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CMS PQRS Measure #1 (NQF 0059): Diabetes Mellitus: HgB A1c Poor Control

ICD-9-CM 54 Codes • 250.00, 250.01, 250.02, 250.03,

250.10, 250.11, 250.12, 250.13, 250.20, 250.21, 250.22, 250.23, 250.30, 250.31, 250.32, 250.33, 250.40, 250.41, 250.42, 250.43, 250.50, 250.51, 250.52, 250.53, 250.60, 250.61, 250.62, 250.63, 250.70, 250.71, 250.72, 250.73 250.80, 250.81, 250.82, 250.83, 250.90, 250.91, 250.92, 250.93, 357.2, 362.01, 362.02, 362.03, 362.04, 362.05, 362.06, 362.07, 366.41, 648.00, 648.01, 648.02, 648.03, 648.04

ICD-10-CM 83 Codes • E10.10, E10.11, E10.21, E10.22, E10.29,

E10.311, D10.319, E10.321, E10.329, E10.331, E10.339, E10.341, E10.349, E10.351, E10.359, E10.36, E10.39, E10.40, E10.41, E10.42, E10.43, E10.44, E10.49, E10.51, E10.52, E10.59, E10.610, E10.618, E10.620, E10.621, E10.622, E10.628, E10.630, E10.638, E10.641, E10.649, E10.65, E10.69, E10.8, E10.9, E11.0, E11.01, E11.21, E11.22, E11.29, E11.311, E11.319, E11.321, E11.329, E11.331, E11.339, E11.341, E11.349, E11.351, E11.359, E11.36, E11.39, E11.40, E11.41, E11.42, E11.43, E11.44, E11.49, E11.51, E11.52, E11.59, E11.610, E11.618, E11.620, E11.621, E11.622, E11.628, E11.630, E11.638, E11.641, E11.65, E11.69, E11.8, E11.9, E11.649, O24.011, O24.012, O24.01

CMS Hospital Inpatient Quality Reporting Program (proposed)

Condition/Procedure # ICD-9 Codes # ICD-10 Codes

Acute Myocardial Infarction

20 10

Heart Failure 24 18

Pneumonia 22 22

Hip Arthroplasty 2 55 (body part, location, device, qualifier)

Cesarean Section 5 3 (dropped NEC and NOS)

All Conditions/Procedures 4843 13844 (185% more codes)

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CMS Hospital Outpatient Quality Reporting Program (proposed)

# ICD-9 Codes # ICD-10 Codes

Acute Myocardial Infarction

20 10

Chest Pain, Angina, Acute Coronary Syndrome

8 10

Mental Disorders pages pages

Stroke 13 101

Long Bone Fracture pages pages

All Conditions 824 8291 (906%)

Hospital Acquired Conditions CMS Hospital Acquired

Condition # of ICD-9 Codes

# of ICD-10 Codes

ICD-10 Concepts

Foreign object retained after surgery

2 53 Type of procedure, type of complications such as adhesions, obstruction, perforation

Air embolism 1 1 Current code specific to AE following transfusion, injection or infusion.

Blood incompatibility 5 5 No new concepts.

Pressure ulcers, stage III & IV 2 50 Specific site w/laterality

Falls & certain trauma 1059 3664 Specific fractures, dislocations, burns, & other injuries w laterality

Catheter-associated UTI 11 15 Acute, chronic, w/wo hematuria

Vascular-catheter associated infection

1 2 NEC or NOS

Manifestations of poor glycemic control

13 18 W/wo coma, type of manifestation, drug or chemical induced

Mediastinitis following CABG 10 232 Approach, site, laterality, # of vessels

Surgical site infections following ortho

7 738 Approach, site, laterality, type of device

DVT following ortho 12 158 Approach, site, laterality, type of device

Bariatric surgery 7 52 Approach, site, method

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AHRQ Quality Indicators

• Re-specifying some based on original intent

• Re-conceptualizing some

• Using GEMS

• Version 5.0.9 – Final Version – May 2015 • http://www.qualityindicators.ahrq.gov/Downloads/Resources

/Publications/2011/ICD-10%20Report%2002-08-11%20Final.pdf

HEDIS

• NCQA took three years to develop their recommendations. – http://www.ncqa.org/Portals/0/PublicComment/NCQA_HEDIS_ICD-

10_CodeRecommendations_20130701.pdf

• Allowing health plans 5 months for Public Comment – http://www.ncqa.org/HEDISQualityMeasurement/HEDISandQualityM

easureImprovement/HEDISandICD10/FinalHEDISICD10ReviewandCommentPeriod.aspx

• Comments due 12/16/13

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WHA Information Center •2014 – Translate in ICD-9

•2015 – Translate in ICD-10

Annual Publications

•Q4 2014 – ICD-9 and ICD-10 versions available at no extra fee

•Q1 2015 and forward – Standard = ICD-10, ICD-9 versions available for additional fee for 3 years minimum

Public Use Data Sets

•Will work with client to understand intent of reporting and translate accordingly

Custom Data Sets

•Translation will occur based on content and intent of measure Quality

Indicators

Public Health • Wisconsin

– ICD-10 used for cause of death coding since 1999

• United States – http://www.cdc.gov/nchs/products/databriefs.htm (Data Briefs)

– http://www.cdc.gov/nchs/products/hestats.htm (E stats)

– http://www.cdc.gov/nchs/data/hus/hus12.pdf (2012 Injury Data)

– http://www.hcup-us.ahrq.gov/reports/statbriefs/statbriefs.jsp

(Stats Briefs)

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ICD-10

Sheila Goethel, RWHC sgoethel@rwhc.com

Penny Osmon Bahr, Avastone Technologies

posmonbahr@avastonetech.com

Debbie Rickelman, WHA Information Center drickelman@wha.org