Perficient Healtchare Solutions Blog

Subscribe via Email

Subscribe to RSS feed

Archives

Follow Healthcare Technology on Pinterest

Mike Berard

Mike provides healthcare business process and technology leadership and expertise in payer and health plan environments. Mike’s healthcare project, program, and portfolio management experience spans large and complex technology integration, infrastructure management, and organizational transformation. Mike's payer experience has been focused on Blue Cross & Blue Shield members including BCBS of Kansas City and BCBS of Tennessee. Mike has particular expertise in 5010 and ICD-10 strategy development and implementation. Mike has taken a leadership role in supporting the management of Perficient’s healthcare technology partnerships that support the Healthcare Compliance Agenda.

Homepage http://www.perficient.com

Posts by this author: RSS

AHIP Conference 2012: Day 3 Update

Malcolm Gladwell, staff writer for the New Yorker magazine and author of “What the Dog Saw,” “Outliers,” “Blink” and “The Tipping Point,” offered an overview of “Cowboys Versus Pit Crews: How to Build a Sustainable Health Care Delivery System” at our start of Day 3.

Gladwell was introduced as “gifted” at interpreting new ideas in the social sciences and making them understandable, practical and valuable to business and general audiences alike. Gladwell did shed light on a few industry examples including self dialysis and remote health as no-brainers in a cost-conscious future state of the healthcare delivery system, yet we still see extensive pushback from less progressive distracters that have a vested interest in the status quo.

I’ll confess; I did sneak out a bit early to get in line for a signed copy of “Outliers”…

Gladwell was followed by a discussion of the “Doorway to Health System Change” with contributions from a distinguished panel including: Michael E. Chernew, PhD, Professor of Health Care Policy in the Department of Health Care Policy at Harvard Medical School; Daniel Kessler, PhD, Professor at Stanford’s Business and Law Schools and a Professor (by courtesy) at Stanford Medical School; and, Scott E. Harrington, PhD, Alan B. Miller Professor; Professor of Health Care Management and Insurance and Risk Management, University of Pennsylvania.

Chernew’s research examines several areas related to controlling health care spending growth while maintaining or improving the quality of care. His work on consumer incentives focuses on Value Based Insurance Design (VBID), which aligns patient cost sharing with clinical value. Chernew suggested that depending on the new health care budget and the extent to which it will rise, it will determine the scope of delivery system impact upon the under 65 demographic. Chernew suggests that the American public is expecting a “perfect government in an imperfect market.” The role of government will require clarity regarding who ultimately needs to make decisions considering taxation, willingness to pay and disparity.

Kessler has written numerous articles and books about health economics and health policy. His current research interests include how tax policy affects medical spending and how vertical integration and other shared ownership structures in markets for health services affect the cost and quality of care. Kessler suggested that a key consideration is within the tradeoff between an “expanded safety net and cost control.”  Kessler further suggests that the root cause is in the “mis-set incentives” where plan decision ownership (employers vs. employees), transparency (competition amongst providers) and benefit design (latitude of coverage within a regulated plan) will require refinement in our future state health care delivery system.

Harrington has published widely on the economics and regulation of insurance and is a frequent speaker on health insurance reform, insurance markets, regulation, and public policy. Harrington has also testified before the U.S. House and Senate on insurance regulation and before numerous U.S. state legislative and administrative committees and he recently was appointed to the U.S. Treasury’s Federal Advisory Committee on Insurance. Harrington clarified 2 distinct approaches to Health System Change: Increased Government Control or Markets & Consumer Driven change. Where the current ACA places emphasis on increased government control, Harrington suggests that there must also be provisions to allow for competition and consumer choice.

Good news is that we won’t have to speculate on the Supreme Court ruling much longer…

AHIP Conference 2012: Day 2 Update

AHIP CEO Karen Ignagni kicked off Day 2 by addressing the elephant in the room…no Supreme Court ruling today. The fate of the Affordable Care Act (ACA) and “the Mandate” within would have to wait another day. Ignagni went on to remind the conference goers that similar attempts at state-based reform in the mid-90s resulted in 8 failures and no successes. Ignagni noted, “A key point regarding the 1994 reforms is that they were approved without a coverage requirement that brought everyone into the system. This omission sowed the seeds for a rapid and dramatic erosion in Kentucky’s individual insurance marketplace and eye-popping premium increases.”

Regardless of the Supreme Court ruling, there is still a clear need for shifting the cost of the care delivery system from the administration of care to the delivery of health outcomes.  Ignagni would like to see a continued or increased focus on Best Practices related to quality, cost and transparency within the end-to-end health care delivery system. Ignagni’s advice to AHIP is continued “Leadership, Innovation and Transparency” as the health care industry transitions into the execution phase of the roadmap for change.

And worth the price of admission alone, Paul Begala and Ari Fleischer were given an opportunity to foreshadow the Supreme Court ruling and offer thoughts on the impact to political climate.  Begala was the chief strategist for the 1992 Clinton-Gore campaign. Fleischer is a former White House Press Secretary for President George W. Bush. Now, both are colleagues as political commentators at CNN.

I feel I’m as qualified as anyone to offer a non-partisan overview of the session highlights especially since I’m a non-voting Canadian…

Fleischer felt that either the ACA will be ruled unconstitutional or Mandate alone, which in either case would generate GOP momentum and carry through to November.  Balaga suggested that 5 of 9 Republican Supreme Court Justices would ultimately default to partisan alignment and strike down the entire ACA, though the country’s satisfaction with future direction still trending to a second term for Obama.

Stay tuned…

AHIP Conference 2012: Day 1 Update

As referenced in the introduction to “America’s Health Insurance Plans (AHIP) Conference,” the decisions that will shape our nation’s health care are near. The Supreme Court Decision. The Presidential election. Implementation decisions within health plans that are shaping the delivery of care.

The intent of the June 20-22 conference in Salt Lake City is to address these factors head on. Many of our nations Health Plans intend to learn firsthand how these decisions will affect their organization’s efforts both immediate and long term.

Close to 200 vendors have either sponsored the conference as content providers or made their Leadership Team available to conference participants.  It is clear that Health Plans have access to an outstanding forum to access a variety of perspectives for navigating their agenda for change.

One theme that has already percolated to the surface of general discussion is the need for industry-wide collaboration.  There may have been good effort already allocated to SOA, 5010, ICD-10, ACOs and general Exchange strategy, but the time has come to transition from plan to action.

AHIP Day 1 included a review of Exchanges as one of the most pressing health care reform implementation issues for health plans, states and national policy makers. AHIP has dedicated a good portion of the agenda to review the policy and operational issues over the past year through examining the critical issues for health plans with a focus on the practical challenges.  Time well spent.

ICD-10: Payers & Providers Need to Get Along

On April 17, 2012 the Department of Health and Human Services (HHS) published a proposed rule that would delay, from October 1, 2013 to October 1, 2014, the compliance date for the International Classification of Diseases, 10th Edition diagnosis and procedure codes (ICD-10). HHS is seeking comments by May 17.

The proposed rule extends the deadline for use of ICD-10 code sets used in claims management and medical billing from October 1, 2013 to October 1, 2014, responding to providers concerned with the difficulty of implementing the new edition in the time provided. AHIMA and HIMSS are urging us to “stay the course” with our implementation planning. I agree.

Payers and Providers do not always have alignment of their own internal business and IT. Payers and Providers are not always in agreement with each other’s medical policy that will be used to defend a GEM. Payers and Providers are not always in agreement with each other’s perspective of benefit and reimbursement. Now let’s scale up from 17,000 ICD-9 codes to 155,000 ICD-10 codes…

Payers and Providers Need to Get Along

The clock is ticking, and we’re still trying to define neutrality before we can even start to build processes to verify neutrality, and then we need to re-contract…

The Workgroup for Electronic Data Interchange (WEDI), an industry advocacy organization, conducted the survey in February and has submitted results to the Centers for Medicare and Medicaid Services (CMS). Based on the premise that ICD-10 impact assessments should have been completed in 2011, the WEDI survey results find:

  • Nearly half of providers did not know when they will complete the impact assessment;
  • More than a third of insurers had completed their impact assessment and a quarter of them were less than halfway done;
  • One-third of providers expected to begin external testing in 2013 and one-half did not know when the testing would start;
  • Most insurers do not expect to begin external testing until 2013; and
  • About half of surveyed vendors were less than halfway through with their product development.

In order to start making sense of the ICD-9 to ICD-10 code variability risk, payers and providers must consider the following:

  1. Need for process to evolve medical policy to defend the clinical equivalency mapping of ICD-9 and ICD-10 codes ongoing
  2. Need for identification of ICD-9 codes within software application logic, then remediate or replace systems as required
  3. Need to end-to-end claim adjudication, benefit assignment and reimbursement variability testing as foundation for Payer/Provider re-contracting

Internal Business and IT need to get along.  This is not typical SDLC.  Testing sooner rather than later will allow for the re-introduction of test results within each iteration of process refinement. Organizations need to embrace collaborative and dynamic requirements management.

Organizations need to pick partners wisely.  You can’t outsource accountability for compliance through vendors and hosted solutions.

Adjudication, benefit assignment, reimbursement schedules and re-contracting can happen later.  Let’s make sure we don’t miss the mark on our assessment of clinical equivalency. Medical policy will provide context for defending our GEM, but we’ll still need to verify through testing. Even though HHS has proposed a 1 year reprieve,  Payers and providers need to get to the table asap.

ICD-10 Neutrality: How will you use your deadline extension?

Since Health and Human Services Secretary Kathleen G. Sebelius announced that HHS will initiate a process to postpone the date by which certain health care entities have to comply with International Classification of Diseases, 10th Edition diagnosis and procedure codes (ICD-10), the healthcare industry is still trying to figure out the scope and the impact of the extension.

The statement did not offer more information about which “certain healthcare entities” would receive an extension, though HHS Secretary Kathleen Sebelius has suggested, “We have heard from many in the provider community who have concerns about the administrative burdens they face in the years ahead.  We are committing to work with the provider community to reexamine the pace at which HHS and the nation implement these important improvements to our health care system.”

What we do expect is that payers and providers alike have an opportunity to refine their approach for testing Payment, Benefit, Clinical, Operational and Financial Neutrality.  A few key questions that could be evaluated sooner rather than later may include:

  1. How will payers and providers sync up on GEMs?
  2. How will business departments evolve processes that use ICD-9 codes without payers and providers syncing up on GEMs?
  3. How will IT departments change the application logic of legacy systems that use ICD-9 codes if business can’t commit to evolving processes that use ICD-9 codes without payers and providers syncing up on GEMs?
  4. How will payers and providers recontract for an ICD-10 world if IT departments, well, you get the picture…

And, we now get to ask the new question, “if we expect the final version of ICD-11 in the 2015 timeframe, and we’re pushing out the ICD-10 deadline from October, 2013, then why don’t we just leapfrog ICD10 altogether?”  The answer is that we need to stay the course in the buildout of methods, approaches and processes for Neutrality Testing.

I did have an opportunity to assist a Canadian Provincial health organization in consolidating its internal governance that supported 34 health districts all within a province.  The intent behind the streamlined governance effort was to reduce the administrative overhead for administering care to allow a refocus of investment on the delivery of care.  Sound familiar?  This effort was initiated in 1997.  15 years later, this same Provincial health organization has 13 health districts.  It’s a work in progress…

Payer and Provider organizations do not always have alignment of internal business and IT.  Payers and Providers are not always in agreement with each other’s medical policy that will be used to defend a GEM.  Payers and Providers are not always in agreement with each other’s perspective of benefit and reimbursement.  Now let’s scale up from 17,000 ICD-9 codes to 155,000 ICD-10 codes…

What if the industry had access to an objective, 3rd party environment for the build out of joint medical policy and GEM development, based upon collaborative assessment of code variability risk?  Probably makes sense to focus on clinical equivalency before jumping to benefit and reimbursement, right?

What if the industry had access to an objective, 3rd party environment for the build out of joint process development for managing code variability risk as an ongoing process, and IT systems (or business rules/application logic) remediation was ongoing, and payer/provider was recontracting ongoing?

If we can learn to operationalize “change” maybe ICD-11 won’t be so bad.  Stay tuned…

ICD-10 Revenue Neutrality: A Strategic Approach

Regardless of the pending ICD-10 deadline extension, the healthcare industry will still need aggressive effort in refinement of defensible ICD-10 General Equivalency Maps (GEMs), remediation of impacted processes and systems, and a roadmap to figure out how payers and providers can work together to achieve neutrality objectives.

To date, there has been only limited guidance to define the dimensions of neutrality. Dennis Winkler, Director of Program Management with BlueCross BlueShield of Michigan (BCBSM), defined six dimensions of neutrality and BCBSM’s approach to achieving payment neutrality during the ICD-10 Summit in Cape Coral, FL on Feb.16, 2012, including: Revenue (Payer), Payment (Provider), Benefit (Member), Clinical (Programs), Operational (Servicing) and Financial (Overall). Dennis defined Revenue Neutrality as, “Neutrality is based on no significant increase or decrease in reimbursement.”

Within Revenue Neutrality payers must consider clinical accuracy, contractual logistics and parsing of procedural coding in a way that encompasses all possible iterations of clinical modeling within revenue modeling. This will not be easy…

Revenue Neutrality must address anticipated reimbursement relationship changes with providers. Reimbursement must consider timing of claim submission, provider coding knowledge/expertise, anticipated variations in provider coding policy as well as remediation of adjudication processes.

In addition, Revenue Neutrality must address anticipated operational and technology changes including gateway systems, data platforms, data channeling for claims submissions, data channeling to address gaps and upgrades during ICD9 to ICD10 transition, and data channeling to address ICD10 coding refinement and contractual fulfillment ongoing.

Revenue Neutrality must ensure clinical accuracy is inclusive of pre-defined mapping to GEMS, MS-DRG, and reimbursement that will serve as a starting point for comparative analyses. Payers must develop capability for ongoing comparison of claims coded in ICD-9, ICD-10, and ICD-9 paired to ICD-10 formats to evaluate assignment of benefits based upon contractual specifications, pre-, concurrent-, and post- transition from ICD-9 to ICD-10. Payers should review claims for billed, allowed and paid amounts based upon higher risk of variability in procedural coding considering volume of specific ICD-9 codes used, dollar value of reimbursement assigned to code within claim, and the utilization associated to specific providers.

Revenue Neutrality verification may occur at Entry, Intermediate or End stages of Claims and Benefits assignment.

Entry-stage verification will entail a thorough review of claims prior to entering payer data processing systems. Entry-stage verification can include complete claims review or pilot analyses. Entry-stage verification will enable lapses in clinical accuracy and financial neutrality in the beginning stages that will deter later processing efforts. Limitations to entry assessment include a lack of incorporating the complete processing systems based on predictive modeling. Advantages include early detection and modeling that can guide later processing.

Intermediate-stage verification will require claims be reviewed in pre-determined stages of data processing, to ensure that information is consistent throughout claims cycling in ICD-9 and ICD-10 submissions. Intermediate assessment will enable a review of the processing infrastructure with regard to all components of financial neutrality. Intermediate assessment will enable real-time modifications to reimbursement determinants before entering extensive adjudication processes. Limitations to Intermediate-stage verification include having a variable number of data processing factors that are not consistent across all claims reporting periods. Advantages include a dynamic review as the information is being processed.

End-stage verification can be further categorized into provider specific, contract specific, and disease specific comparison between ICD-9 and ICD-10. The objectives of an End-stage assessment will encompass an overall differential comparison in billed, allowed, and paid amounts that include the claims submission process in its entirety. Limitations to End-stage verification may be its deficiencies in a comprehensive review of lapses that may occur during provider processing and submission, data processing, and inherent information systems flow. Advantages include having all claims information processed at a final stage of contractual comparison.

The reality is that Revenue Neutrality verification is still subject to the availability of a Claims and Benefits test environment that will mirror production but accommodate GEMs and reimbursement schedule refinement on the fly.  Does this mean that organizations will be subject to an infrastructure investment that also mirrors production?  And will the test environment be subject to the same change control rigor of the production environment? I wonder if we have enough “maintenance widows” to support the number of changes to Claims and Benefits systems’ application logic before we know what changes to make the GEMs and reimbursement schedules…

Revenue Neutrality may have an initial focus on billing and reimbursement based on clinical accuracy in procedural coding, but will ultimately depend upon remediation of information systems and close collaboration between the payer and provider for ongoing refinement of reimbursement contracts.

ICD-10 Revenue Neutrality: Health Outcomes and Cost

As the October 1, 2013, deadline for ICD-10 compliance gets closer, the Revenue Cycle Management will surface as the next Healthcare Organization show stopper. ICD-10 clinical specificity will better position Providers to accurately identify actual conditions and treatment, but reimbursement accuracy will require verification of acceptable variance utilizing historical ICD-9 coding, billing and receivable data.

ICD-10 clinical specificity is intended to improve understanding of diseases which will allow for realignment of costs from administration of care to delivery of care.  ICD-10 will allow for refinement of financial/reimbursement models, but not without its challenges along the way…

The ICD-10 code sets are not a simple forward crosswalk or backward crosswalk update of ICD-9. The ICD-10 code sets have fundamental changes in structure and concept that make them very different from ICD-9.  If healthcare entities are able to address medical policy change to defend a General Equivalency Map (GEM), reimbursements for ICD-10 coded claims must still be within an acceptable variance for Payers and Providers. Any change to GEMs, reimbursement structure or methodologies must be made on a Payer and Provider revenue-neutral basis.

For example, ICD-9 Code 6149 is categorized under MS-DRG 759. When converting to ICD-10, ICD-9 Code 6149 can be mapped to two different ICD-10 codes: N735 or B3749. These map to DRG 759 (same as ICD-9) and 690, respectively. The resulting payment in the second case is about $6,000 more than what would have been paid before the ICD-10 transition.

In order to manage the risks associated with DRG based reimbursement, Payers will need to assess their ICD-9 to ICD-10 GEMs and corresponding DRG groupers and prioritize remediation efforts towards mappings that expose the highest degree of variability while considering the associated reimbursement.

Healthcare organizations have started to prepare to address this issue by creating a seat at the executive management table for Revenue Cycle Management. Payers and Providers must be able to forecast possible changes to cash flow to protect revenue losses before, during and after ICD-10.  The challenge is that financial/reimbursement models will require mutual Payer and Provider verification and Payer and Provider verification must be grounded in defensible medical policy associated to underlying GEMs.

The question is “Are Payers and Providers refining GEMs and reimbursement in an environment of collaboration?” If not, we may need to buckle in for an extended re-contracting cycle…

ICD-10 Systems Remediation: The Countdown is on

In preparation for satisfying the ICD-10 medical diagnosis and inpatient procedure coding on October 1, 2013, Healthcare organizations will need to indentify all instances of ICD-9 codes that are maintained within the application logic of supporting business systems as a component of their ICD-10 Compliance Agenda. Impacted systems will include, but are not limited to, core claims administration, including the assignment of benefit to claims. Healthcare organizations must verify all business processes, data stores, applications, interfaces and reports impacted by the change to ICD-10. All systems that capture, store, send, receive, or edit diagnosis or procedure codes must be modified to accommodate ICD-10. And the clock is ticking…

In addition to claims and benefit administration, ICD-10 has the potential to impact enrollment, eligibility, adjudication, pricing, underwriting, medical management, case management, provider payment, provider contracting and more. Systems remediation must consider people, business processes and technology when assessing the scope of ICD-10 change.

What’s the Holdup?

Often, Healthcare organization “Business Areas” and IT Departments do not have service level agreements (SLAs) to govern the systems remediation functions of scenario, case, requirements and test management.  In the absence of SLAs, Healthcare organization IT departments, as internal service provider to Business Areas, often fall short of delivering services that meet Business Areas expectations of change timeliness and minimized cost, as well as accuracy and performance of development and remediation support.

Frequently, Healthcare organization Business Areas fall short in providing enough detail to scenarios, cases and business requirements to enable IT to define acceptable technical specifications to guide development and remediation support.

The traditional change management challenge is the development of effective internal collaboration between business owners, who are accountable for performance and integrity of execution of business process and IT, which are accountable for enabling business process through the use of IT.

Now, more than ever, Healthcare organizations demand the bridging of the gap between business area expectations and IT delivery of services. We don’t have time to wade through the layers of internal political distraction while the ICD-10 Compliance clock is ticking. If you already subscribe to the transition from Waterfall to Agile development, you’re half way home…

Collaboration’s Key Role

The next step is to evolve traditional change management through the development of a dynamic environment of collaboration that will directly support systems remediation through web-based dynamic workflow, cueing and messaging, in support of building a role and permission based system for the development of use scenarios, use cases, user requirements and test outcomes definition.

The reality is that the use of a dynamic environment of collaboration between business and IT is not limited to ICD-10 Systems Remediation.  Business and IT collaborative effectiveness needs to be woven into the fabric of organizational culture ongoing. This is not a one and done exercise.  The only thing missing is the method, approach, process and enabling tools to ensure repeatability and sustainability.

At what stage is your ICD-10 conversion? What tools are you using?

Replay and Slides! How to Leverage Increased Data Granularity in the ICD-10 Code Set

Last Thursday I spoke in a webinar entitled “Opportunities Abound: How to Leverage Increased Data Granularity in the ICD-10 Code Set”.  You can view the slides below, and you can view a full recast of the webinar here: http://www.perficient.com/webinars/

Let me know what you think!

ICD-10 Migration Approach: Systems Remediation

Healthcare Payers must determine all business processes and applications impacted by the change to ICD-10. Applications that capture, store, send, receive, or edit diagnosis or procedure codes must be modified. Fields must support alphanumeric characters and expanded to support an extra digit. The new specificity of IDC-10 codes will impact corresponding application logic, business rules, system interfaces and data reporting. And the clock is ticking…

Systems remediation must consider people, business processes and technology when assessing the scope of ICD-10 change. ICD-10 has the potential to impact enrollment, eligibility, claims, adjudication, benefits, pricing, underwriting, medical management, case management, provider payment, provider contracting, and more.

Organizations must understand issues, challenges and opportunities for change when determining extent of change to be undertaken. Clearly, basic coding, revenue cycle processes, EDI transactions and compliance reporting must be changed. Tougher decisions must be made in order to determine the right level of investment in data analytics, reimbursement models and payment monitoring to leverage the detailed data obtained through ICD-10 coding specificity. The most progressive organizations will choose to invest further in development of new products, business relationships, business process and care procedures.

Systems remediation will require a comprehensive assessment of all business process that currently touch ICD9 codes. Organizations must map all enabling technology to business processes. A comprehensive ICD10 systems inventory should include the identification of ownership, accountability and responsibility for both the enabled business process and the enabling technology.

ICD-10 migration complexity will depend upon the underlying technology architecture, count and ease of change of affected system, interfaces and reports. Finally, ICD-10 migration complexity will depend upon data or information transfer relationships with systems vendors, providers, clearinghouses, business partners, regulators and other external entities.

When making “biggest bang for buck” for systems remediation investment decisions, organizations must change business processes and technology, while at the same time trying to maintain normal business operations.  This will not be easy.  Organizations must focus on core capabilities, and then be diligent in picking the right business partners to support the rest of the journey.

Register for our upcoming ICD-10 webinar and receive a free copy of the Harvard Business Review Article, “How to Solve the Cost Crisis in Health Care” by Robert S. Kaplan and Michael E. Porter along with a copy of our most recent white paper, “Implementing ICD-10: Hard Work Brings Rewards”.

ICD-10 Migration Approach: Data Impact Assesment

While 5010 has taken a backseat to ICD-10 in the media, payers must still meet the change to 5010 on January 1, 2012 before implementing ICD-10. Version 5010 accommodates the ICD-10 code, and must be in place first before the changeover to ICD-10.

ICD-10 codes must be used on all HIPAA transactions, including outpatient claims with dates of service, and inpatient claims with dates of discharge on and after October 1, 2013. Otherwise, claims and other transactions may be rejected, and will need to be resubmited with the ICD-10 codes. This could result in delays which would impact the timing of reimbursements.

The combined 5010 and ICD-10 changes will impact people, process and technology across the entire payer organization. Payers must assess which ICD-9 codes that will have the greatest volatility within a forward and backward crosswalk clinical equivalency map. The primary criteria for assessing code data impact will include frequency of code use and cost of associated benefits.

To put the change effort into context, the support associated to determining defensible medical policy, executing a forward crosswalk and validating the clinical equivalency map with a backward crosswalk for 155,000 combined diagnosis and procedure codes would take 155,000 hours at 1 hour per code. From today, there are only 110 weeks remaing till the ICD-10 compliance deadline of October 1, 2013. Based upon a 40 hour work week, it will take over 35 dedicated staff to just administer the clinical equivalency mapping of all codes.

Rumors persist that CMS (The Centers for Medicare and Medicaid Services) will again reset the ICD-10 compliance deadline, but don’t count on it. Implementation planning should be undertaken with the assumption that the Department of Health and Human Services (HHS) will NOT grant an extension beyond the October 1, 2013 compliance date. HHS has no plans to extend the compliance, which means that covered entities should plan to implement ICD-10 for production use on October 1, 2013.

Most payers will utilize the CMS Gerenal Equivalency Map (GEM) documents for ICD-9 Diagnosis and Procedure code mapping to ICD-10 codes which will support of the forward crosswalk but will not support the backward crosswalk necessary for financial and benefit neutrality verification. Payers will need a method and process of collecting the critical details that explain how and why the codes are related, or where they differ. Payers will have to spend a significant amount of time and effort to evaluate those differences.

Defensibility of code mapping will require a deeper understanding of historical ICD-9 coded claims data and corresponding ICD-10 code mapping. Analytics tool vendors are currently developing and refining their capability to support the automation of the historical claim data analysis to determine frequency of code use and cost of associated benefits. Payers understanding of which ICD-9 codes create revenue risk or associated benefit risk will enable the use of this analysis to prioritize and focus efforts to reduce mapping volitility.

Automating code mapping analysis will reduce the time and resources needed for developing defensible code mapping for individual codes based on frequency of code use and cost of associated benefits.

Do you  have questions about ICD-10?  Join me on September 15th for a free webinar “Opportunities Abound: Leveraging the Increased Data Granularity in the ICD-10 Code Set”Register today

ICD-10 Migration Approach

The migration from the ICD-9 to ICD-10 code sets is one of the most extensive and risky conversion projects Healthcare Insurers will face. Conversion will impact organizational structure, business processes, healthcare policies and IT systems. The scope of this change presents significant risks to Insurers seeking to achieve financial and benefit neutrality to avoid undermining provider relationships.

The organizational transformation for “operationalizing” neutrality will require a 3 step approach:

  1. Data Impact Assessment: Insurers must assess which ICD-9 codes will have the greatest volatility within a forward and backward crosswalk clinical equivalency map. The primary criteria for assessing code data impact will include frequency of code use and cost of associated benefits.
  2.  

  3. Systems Remediation: Insurers must determine all business processes and applications impacted by ICD-10. Applications that capture, store, send, receive, or edit diagnosis or procedure codes must be modified. Fields must support alphanumeric characters and expanded to support an extra digit. The new specificity of IDC-10 codes will impact corresponding application logic, business rules, system interfaces and data reporting. 
  4.  

  5. Operational Change:
  • Case management, disease management, and utilization management must change to accommodate clinical management dependency upon code specific business processes.
  • Medical policy management must have governance and audit-ability to ensure clinical mapping defensibility
  • Claims processing will require more resources to validate, adjudicate and reimburse claims.
  • Actuarial will require capability for cost projections based upon both ICD-9 and ICD-10 historical data.
  • Provider networking and re-contracting will require changes to fee schedules and reimbursements based upon analytics to verify revenue neutrality

Because providers will have different timeframes for when they begin submitting ICD-10 codes, Insurers will need to be able to process both ICD-9 and ICD-10 codes. Insurers will require scalable, high performance healthcare data transformation. Using a medical ontology-based approach, Insurers will need comprehensive testing and automated comparison of ICD-10 results versus expected outcomes.

Analytics that use ICD procedure and/or diagnosis codes will change dramatically under ICD-10. The challenge will be in determining how best to take advantage of the greater specificity of condition, diagnosis and treatment data that will be available after healthcare organizations migrate to the ICD-10 code set. Business intelligence solutions will need to support ICD-9 and ICD-10 codes simultaneously during the transition. Reporting, efficiency and population risk models or other aggregation schemes must be fully remediated to support native ICD-10 as well as native ICD-9 codes. Architectural solutions must support technical platform compatibility and ease of integration in existing models.