ICD-9 to ICD-10: What’s in a Code Set Anyway?

While we discuss the ICD-9 to ICD-10 conversion mandate, many people are questioning the value of such a change. Questioning change is a good thing, but by now we all know that updating from an outdated 1970s code set to a more modern 1990s code set is critical for providers to be accurately compensated for care rendered. Why are ICD-9 codes not adequate? Well, think institutionalization of the mentally ill. In the late 1960s and early 1970s, mentally ill individuals began the transition from state-run public mental hospitals to community homes where they were treated as individuals instead of as a population of sick people with no hope. Today, the services and support provided to the mentally ill lends itself to establishing community tenure – It is a different world, yet we still use the out-of-date code set that was in effect during the age of institutionalization. This example shows one small example of how healthcare has changed since the ICD-9 code set was introduced. It exonerates the notion that an out-of-date code set cannot serve the industry well.

Costs
A thorough review of ICD-10 was conducted by the Rand Institute and confirmed that the change from ICD-9 to ICD-10 is a costly one for organizations, but adopting the ICD-10 code set will offset these costs by somewhere between $600 million and $7 billion over 10 years. On top of this, ICD-10 will provide more detailed clinical data for payers and providers – which can be used for reporting and to make more informed business and clinical decisions. Yet, providers seem to be lagging behind when it comes to preparing for ICD-10 compliance.

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Payers seem to be gearing up for the change and eager to utilize the ICD-10 code set to make adjustments to payments and care scenarios. It is as if this segment of the healthcare industry is eager to begin using the more detailed claims data to influence the industry. While this is fine and dandy – it does lend itself to wondering why providers have been so stand off-ish.

Providers
A recent Edifecs’ White Paper touches on the provider impacts and explains how providers; revenue stream and ability to meet Meaningful Use initiatives will be severely threatened if they do not comply. The author suggests providers and payers alike need to seek ICD-10 “neutrality.” This is an interesting but accurate way to view ICD-10 compliance. If providers took this approach to ICD-10 compliance, they may better understand areas of impact and more importantly areas of opportunity from a financial and clinical perspective. So meeting compliance is the necessary minimum, but extracting value from the data should be the goal of this change.

Answer
To wrap it up – we started with the question – “what’s in a code set?” And, the frank answer is – your revenue. However, at the end of the day will be provider revenue or payor profits? This will be determined by the providers and how they the ICD-10 code set to increase the delivery of care, promote efficiencies in documentation and diagnoses. In the end, prudent providers will “protect reimbursements” by properly using the ICD-10 code set.