ICD-10 & the Cost of Coding
There’s no question ICD-10 has received its share of pushback, and finances are a big part of that. Some providers struggling to fund EHR/Meaningful Use mandates say it’s too much too soon, while others feel it’s a change we can’t afford not to make. So what is the true cost of ICD-10?
The Cost of Delay
The U.S. Department of Health and Human Services estimated that a one-year delay in the compliance date adds a range of 10 to 30 percent to the total cost that entities had already spent or budgeted for the transition. That equates to a cost of $1.1 to $6.8 billion for each one-year delay, and that number doesn’t reflect projected fiscal and public health benefits lost under continued ICD-9 use.
“CMS estimated the cost of delay at $6B because of money that providers, insurers, labs and clearing houses have already invested into systems, training and testing,” said Wanda McKnight, president of the Tennessee Health Information Management Association (THIMA). “Some of that can potentially be recaptured, but most of it’s lost. When the last delay came about, everyone had to regroup.”
THIMA and its parent national organization, AHIMA, are advocates of a 2015 implementation. McKnight, who coordinates ICD training workshops statewide, said much of the delay has been driven by unrealistic fears of a system 30 years in the making.
“The belief that ICD-10 is a completely different system from its predecessors is a myth,” McKnight said. “While the amount and format of codes (alphanumeric vs. numeric) is changing, the process of coding, evaluating clinical documentation, and assigning codes is exactly the same.”
Andrew D. McDonald, Healthcare Consulting partner at Nashville’s Lattimore Black Morgan & Cain, P.C. (LBMC), said ICD-10’s delay has been tough on clients, as well as support personnel. “It puts us in a tough spot because bottom lines are so thin, and you hate to advise clients to get ready and spend money and then that not happen,” McDonald said. “You can’t blame hospital administrators for not wanting to spend money. It’s tough when there’s a fear of the unknown, but when there’s a plan it will all work.”
Price Tag of Implementation
A recent Journal of AHIMA article estimates the costs and effort associated with ICD-10 implementation for physician offices has been overestimated and that vendors, health plans, and physicians have made considerable progress with fewer resources than had been previously estimated.
The revised estimated costs for ICD-10 for a small practice is in the range of $1,960-$5,900, where a small practice is defined as three physicians and two impacted staff such as coders and/or front desk/back office personnel.
Estimates of ICD-10 training and costs for a physician practice typically include the costs of a coding book, coder training for impacted office staff, web-based training for physicians and the lost productivity time required for these activities.
That’s substantially lower than previously reported estimates that range as high as $100,000. So why the discrepancy? Typically, those reports reflect EHR updates to meet Meaningful Use criteria – a combo that McKnight considers unrelated.
Training Costs
Training also has become available at fairly low costs – from free workshops to a $75 company-wide webinar to $350-$1,300 for more in depth, comprehensive implementation-type staff training. The ICD-10 Diagnoses codes are available as a free download online, while the book can be purchased for $75-$100. There’s also a handy, low cost iPhone app that allows a word search function, and a less complex free version also is available. The report also found that many software vendors are including upgrades to 10 as part of their routine annual upgrade at no charge.
However, McKnight said payment for any training is still a foreign concept to some providers, who’ve relied on the same coding employee for decades and have spent little to nothing on training.
Outsourcing ICD-10
With 19 times more procedure codes than its predecessor, it’s no surprise that ICD-10 will cost considerably more to outsource. Some experts say companies will pay, on average, 50 percent more in coding fees for inpatients.
McKnight said the increase is also due to an expected reduction in coder productivity, which she expects to level out over time. (A lesson learned from watching Canadian and Australian counterparts make the transition.)
McKnight expects many providers to outsource coding at the beginning of the transition but knows of no providers planning to outsource 100 percent of their work.
McDonald, who works closely with healthcare IT, coding and revenue cycle clients, said hospitals might need a 60-120 day cash flow during the transition, as payers will likely experience a brief backlog.
He also credits organizations like THIMA, the Tennessee Medical Association and the Tennessee Hospital Association with doing an outstanding job of helping hospital and physician groups with preparedness. Ongoing workshops give providers access to last minute training and education, and firms like LBMC, Kraft CPAs, Cumberland Consulting and specialty associations are offering customized ICD-10 training for organizations nationwide.
WEB:
Upcoming ICD-10 Training Events
This is a partial list of training camps coming up this spring and summer. Please check with your affiliated local, state or national specialty associations and with business consulting partners such as LBMC for additional opportunities to access training.
Tennessee Medical Association
The TMA is partnering with AAPC to coordinate a five-city, multi-specialty ICD-10 training workshop July-August. Host cities will include Memphis, Nashville, Knoxville, Chattanooga and upper East Tennessee. Each location will include eight-hour training sessions in: multi-specialty, internal medicine, family practice, pediatrics, orthopaedics and cardiology. A four-hour session will be offered in OB/GYN. For more information, visit: tnmed.org or contact Angie Madden, (615) 460-1662 or angie.madden@tnmed.org.
AAPC ICD-10-PCS Code Set training at Boot Camp
May 21 (Knoxville), July 23 (Nashville), Aug. 13 (Nashville)
aapc.com/icd-10/bootcamp-icd-10-coding.aspx
Contact: (800) 626-2633
THIMA/THA 2015 ICD-10 Boot Camp – Nashville
May 12 — ICD-10-CM (Diagnosis Coding Only)
June 2 — ICD-10-PCS (Procedure Coding Only)
June 3 — Putting it all together: Diagnosis AND Procedure Coding Scenarios/Exercises
thima.org/continuingeducation/thimatha-2015-icd-10-boot-camp-nashville/
Register online
NMGMA will discuss ICD-10 at their monthly luncheon Aug. 11. For more information visit nmgma.com.
Kraft Healthcare Consulting ICD-10 CM and ICD-10 PCS Boot Camps
Option 1: ICD-10 CM Boot Camp (1.5-day option)
Aug. 19-20
Option 2: ICD-10 CM Boot Camp + ICD-10 PCS Boot Camp (3-day option)
Aug. 19-21
kraftcpas.com
Contact: Meg Warren, (615) 782-4203
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