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Six steps to mitigating ICD-10 claim denials

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Eventually, a deadline must be faced – even with a one-year reprieve.

doctor studying

Many physicians whose practices were behind schedule in their plans to comply with the federally mandated transition to ICD-10 breathed a sigh of relief last April when Congress pushed back the deadline for one year to Oct. 1, 2015. Nevertheless, physicians should not let the delay lull them into thinking they can relax their efforts regarding compliance.

ICD-10 is structurally complex. The system provides greater specificity with more than five times the number of ICD-9 codes.

Practices need to ensure that they’re ready when the deadline does arrive to avoid denials and the inevitable cash flow problems that would ensue. This is particularly true for small and medium-sized practices without large reserves.

The Centers for Medicare & Medicaid Services (CMS) has estimated that claim denials will jump 100 percent to 200 percent in the early stages of ICD-10 implementation. But there are steps medical practices can take to mitigate the risk of denials and attendant cash flow issues.

1. Document diligently.

Clinical documentation is key to ensuring proper coding, billing accuracy and, ultimately, proper payment. Therefore, physician engagement is crucial. It is the physician who is responsible for assessing the facts and capturing the appropriate clinical concepts.

Only 63 percent of today’s documentation is ready for ICD-10, according to the American Association of Professional Coders. Doctors will need to think about documentation in new ways, understand the kind of information coders will need to select the proper ICD-10 code and use terminology that equates to the proper code.

In a webinar sponsored by CMS and the Professional Association of Health Care Management, Dr. Joseph Nichols, a certified ICD-10 coding trainer, noted that the new codes cover parameters of severity and risk. These include concepts such as:

  • Causation, co-morbidity, laterality
  • Acute, chronic or intermittent
  • Mild, moderate or severe
  • Episode of care (initial, subsequent or sequela)

Doctors should be documenting these concepts, among others, anyway, Dr. Nichols said. He noted that good data require complete observation of all objective and subjective facts relevant to the patient’s condition.

Using unspecified codes may well lead to delays in payment or denials. Experts suggest physicians and other clinicians begin now to use greater specificity when documenting encounters to enable a smoother transition next year.

2. Clinicians and coders: Communicate!

Because of ICD-10’s complexity, physicians can expect the number of coder queries to increase.

A February 2014 report funded by the American Medical Association (AMA) notes that “communication among physicians and the coding and billing staff is a key area.” In fact, coders interviewed for the study reported that “physician-coding communication would be one of their greatest challenges.”

Industry experts recommend that practices conduct chart reviews now. Working together, physicians and coders will be able to identify gaps and deficiencies in documentation that must be addressed before October 2015.

3. Tap into technology.

The market is flooded with software that can process natural language, analyze it for clinical documentation and auto-code. Some products provide feedback on missing data required for coding.

Proponents say computer-assisted coding can increase productivity and accuracy. Critics, however, point to the problem of “garbage in, garbage out.” Unless the electronic health record templates and interfaces are built and customized for a practice or specialty, the expected benefits may not materialize.

4. Training isn’t just for coders.

Extensive training will be needed for coders, who will be required to increase their knowledge of the new coding structure as well as anatomy and physiology. But physicians and other clinical staff will require education and training as well if they are to provide the specificity needed for documentation.

Comprehensive training for both documentation and coding should begin between six and nine months prior to implementation, according to CMS’s recommended timeline. Practices that began training early in 2014 in anticipation of the former implementation date may need to provide refresher courses for staff due to the year’s delay.

5. Test. Test. Test.

Practices should already be testing their systems internally to ensure that they can generate ICD-10 transactions. Monitor your vendor and payer preparations, and begin external testing with them by year-end if they are ready. Industry stakeholders recommend performing end-to-end testing with all external trading partners if possible.

6. Set aside a reserve.

In addition to delays in claims processing and denials, practices may see changes in payers’ reimbursement rates based on the complexity of cases. CMS, the AMA and other physician associations highly recommend that practices either set aside a cash reserve or establish a line of credit to ensure that they have the resources needed to tide them over through the transition period.

CMS offers numerous online resources for physicians. Their “Road to 10” website built for small-practice physicians provides coding information by specialty, including cardiology, family practice, internal medicine, OB/GYN, orthopedics, pediatrics and others. Go to roadto10.org for more information.