Copyright © 2013 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. Insight Driven Health

Copyright © 2013 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture.

ICD-10 Discussion DocumentJuly 19, 2013

Insight Driven Health


The ICD-10 Mandate:• ICD-10 is a reality. The CMS deadline for compliance is October, 2014.• ICD-10 transition is a reality and requires “all covered entities” as defined by the Health Insurance

Portability and Accountability Act of 1996 to accept and transmit ICD-10 diagnosis and procedure codes.

• The Payer market has embraced the ICD-10 mandate and is aggressively implementing remediation strategies to update their IT systems and business processes to support the mandate.

• Providers may see a significant impact on their net revenues and/or cash collections if ICD-10 is not implemented effectively.

• ICD-10 is not just another IT Project – planning and implementation for ICD-10 Remediation is an Enterprise effort, and requires leadership and effort from Clinical Delivery, Business Operations and IT, at a minimum.

Hospitals Need a Solution and Resources to Accelerate their ICD-10 Remediation:• Achieving “Meaningful Use” is consuming Hospital IT resources – production support costs are over

budget with IT spend increasing 80-180 basis points as a percentage of operating expenses.• Planning and Preparation: involving team members from across the Enterprise.• Train and Educate all impacted personnel on the new coding and documentation requirements.• Evaluate Applications & HIS Suppliers to define Upgrade/Remediation plans & resources.• Design, Test, Train and Activate all impacted systems…and Deploy by October, 2014.

ICD-10 Overview - The Imperative and Our Understanding

2


ICD-10 Overview - History of ICD-9 to ICD-10

For the last 30 years, the United States has used ICD-9

CMS-0013-F mandates the implementation date of ICD-10 on October 1, 2014• ICD-9 codes will not be accepted for services provided on or after October 1,

2014• Prior to October 1, 2014, it is necessary to submit claims using ICD-9 codes

ICD-10 consists of two components• ICD-10-CM Diagnosis classification system• ICD-10-PCS Procedure classification system for inpatient hospital use

Prior to ICD-10 adoption, providers must be compliant in 5010 transactions

Due to the limitations of ICD-9; the need to move to ICD-10• ICD-9 codes existing today are approximately 24,000• ICD-10 codes will include approximately 140,000 codes


ICD-10 Overview – Increased Specificity looks like this…

ICD-10-CM

Many possible codes

S72301A Unspecified fracture of shaft of right femur, initial encounter for closed fracture

S72322A Displaced transverse fracture of shaft of left femur, initial encounter for closed fracture

S72326A Nondisplaced transverse fracture of shaft of unspecified femur, initial encounter for closed fracture

S72301G Unspecified fracture of shaft of right femur, subsequent encounter for closed fracture with delayed healing

S72322G Displaced transverse fracture of shaft of left femur, subsequent encounter for closed fracture with delayed healing

S72326G Nondisplaced transverse fracture of shaft of unspecified femur, subsequent encounter for closed fracture with delayed healing

S72302A Unspecified fracture of shaft of left femur, initial encounter for closed fracture

S72323A Displaced transverse fracture of shaft of unspecified femur, initial encounter for closed fracture

S72331A Displaced oblique fracture of shaft of right femur, initial encounter for closed fracture

S72302G Unspecified fracture of shaft of left femur, subsequent encounter for closed fracture with delayed healing

S72323G Displaced transverse fracture of shaft of unspecified femur, subsequent encounter for closed fracture with delayed healing

S72331G Displaced oblique fracture of shaft of right femur, subsequent encounter for closed fracture with delayed healing

S72309A Unspecified fracture of shaft of unspecified femur, initial encounter for closed fracture

S72324A Nondisplaced transverse fracture of shaft of right femur, initial encounter for closed fracture

S72332A Displaced oblique fracture of shaft of left femur, initial encounter for closed fracture

S72309G Unspecified fracture of shaft of unspecified femur, subsequent encounter for closed fracture with delayed healing

S72324G Nondisplaced transverse fracture of shaft of right femur, subsequent encounter for closed fracture with delayed healing

S72332G Displaced oblique fracture of shaft of left femur, subsequent encounter for closed fracture with delayed healing

S72321A Displaced transverse fracture of shaft of right femur, initial encounter for closed fracture

S72325A Nondisplaced transverse fracture of shaft of left femur, initial encounter for closed fracture

S72333A Displaced oblique fracture of shaft of unspecified femur, initial encounter for closed fracture

S72321G Displaced transverse fracture of shaft of right femur, subsequent encounter for closed fracture with delayed healing

S72325G Nondisplaced transverse fracture of shaft of left femur, subsequent encounter for closed fracture with delayed healing

S72333G Displaced oblique fracture of shaft of unspecified femur, subsequent encounter for closed fracture with delayed healing

ICD-9-CM

821.01 Fracture of femur, shaft, closed


Myth: Short time to

implement . We can wait till 2013.

System reconfiguration and testing for claim submission and overall report generation is immense

Clinical/Financial systems implemented prior to 2013 should be ICD-10 ready

Myth: Our system vendors

will handle the implementation.

Vendors will only address technical aspects of their application

Workflow integration with other applications will fall to the system users

Myth:Reimbursement will

not be impacted.

Expect increased complexity of medical necessity claim edits

Medical severity DRG’s may increase in number due to improved clinical information being reported

Coders, Physicians, and Payors will be adjusting simultaneously to a new coding methodology. Expect initial delays/, requests for further information

All individuals involved in revenue cycle and clinical areas will be impacted

Physician and staff training needs will be large and complex in some instances

Systems/processes outside of HIM control such as Case Management, Utilization Review, Contracting, Quality reporting are all impacted

Myth: Health Information Management (HIM)

will handle all implementation

needs

Reality

ICD-10 Overview - ICD-10 Implementation Myths

RealityRealityReality


ICD-10 Overview - How Prepared are Providers for ICD-10?

6

Planning Remediation Testing

Accenture interviewed several large academic provider clients to determine their ICD-10 preparation. The majority of the providers are currently in the remediation stage.

• Most of the large academic providers have begun or completed the following activities:1. Adoption of a “dual coding” period in facilities prior to go-live during which HIM staff will code records

both in ICD-9 and ICD-10.2. Training is scheduled to support use of ICD-10 codes to enable retention through use.3. Plans to add HIM coding staff, either through staff augmentation or hiring to address potential backlogs.4. Translation of most commonly used diagnosis codes by specialty associations for use in physician

practices.5. Adoption of Computer Assisted Coding (CAC) and Clinical Documentation Improvement (CDI) programs.

• The biggest challenge to progress is related to competing health reform priorities. • Those in remediation were preparing plans for testing with vendors and payors in late

2013 and early 2014. • Only one Provider is ready to test in 1Q13.

ICD-10 Implementation Lifecycle Status


According to a recent HRAA survey of 120 hospital leaders, a portion of medium to Small providers are not sufficiently preparing for a smooth Transition to ICD-10

One-in-Five have not begun education or training practitioners for the shift to ICD-10 code-set

45% have not begun ICD-10 CM training for their coding staff

55% have not begun ICD-10 PCS training for their coding staff

About half of these hospitals are not in-tune with the official CMS ICD-10 Transition timelines

More importantly, 31% do not plan on dual coding prior to October 1, 2014

And 72% have no intention of submitting any ICD-10 claims to their payors for testing

*Sources: http://ehrintelligence.com/2013/07/15/aha-hospitals-will-be-ready-for-icd-10-in-october-2014/

http://www.healthcare-informatics.com/news-item/survey-small-mid-sized-hospitals-slow-icd-10-implementation

ICD-10 Overview - How Prepared are Medium-to-Small Providers for ICD-10*?

7


ICD-10 Overview - Critical Success Factors for Achieving ICD-10 Include

Physician Readiness1

Complete and accurate physician documentation to support ICD-9 and ICD-10 codified data.

Adoption of Clinical Documentation Improvement program to help with physician engagement.

Achieve Revenue Neutrality through Operational Preparation

2

Adoption of “Dual Coding” period. Knowledge transfer/education provided to key

leadership/teams staged according to fully integrated program plan development and execution.

Detailed contracts with other providers, payers and vendors with clear identification of timing, integration and conversion/translation applications.

IT System(s) Readiness3

Fully integrated IT and other systems currently containing ICD-9 codes across all hospital, vendor, payer and other integrated systems (electronic and other).

Comprehensive modeling and integrated functional testing plan across the continuum of care.

As coordination is KEY - Strong ICD-10 Program

Management needs to be in place to drive the

implementation across the various work streams

8


ICD-10 Overview - Anticipated Impact Areas

Network Management

Pricing / Contract

Management

Patient Access

Clinical Documentation

Integrity

Patient Financial Services

Scheduling / Medical Necessity

Pre-Service / Registration

Financial Counseling

Pricing

Contract / Reimbursement Modeling

Contract / Payment Analysis

Charge Capture / Reconciliation

Coding / DRG Assignment

Physician / Nursing Documentation

Clinical Data / Quality Reporting

Claim Edits / Claims Processing

Remittance / Denial Posting

Account Resolution

High Impact

Medium Impact

Low Impact

PEOPLE /

TRAININGPROCESS

SYSTEMS /

TECHNOLOGY

REGULATORY

COMPLIANCE Re-Credentialing - Process Flow

Process: Re-CredentialingBegin Process

Quality Analyst/Manager

Generate Report*(Sort by County)

Recred CoordinatorCreate Packets foreach Provider on

List & Send toProvider

Note:* Report is run every 3 months. All providers must be re-credentialed every 3 years.** A Reminder Packet is sent at the 30 day checkpoint and a Term notification letter at the 90 day checkpoint*** Refer to Re-Credentialing Procedures Document for code status definitions****Termination lists are sent to Provider Files and Provider Affairs for Processing. Record status is changed toNJC11

Recred CoordinatorCreate & Send

Reminder Packet tothose providers still

outstanding

Recred CoordinatorPacket ReceivedChange status

code to NJR10***

End Process

Data AnalystProcess

Application,Including Updating

CredPro

Data AnalystOnce completed -Change ProviderRecord Status

Code to NJR3***

Received AnyPackets within

30 days?

Received AnyPackets within

60 Days?

No

No

Quality AnalystRun "Ready for

Committee" Report- NJR3***Providers

Credentialing CommitteeApproval Process

Approved byCommittee?

Data AnalystFinalize and

Change StatusCode to NJR12***(all approved) and

Send Letter toProviders

Quality AnalystChange Status

Code to NJC11***

Quality AnalystNotify Provider

Files & ProviderAffairs of Terms

(all denied)

Data AnalystClose Application &

File

End Process

Data AnalystCopy Form (If Any)

& Forward toProvider Files to

Update OtherSystems

End Process

Data AnalystBegin Processing

Terms****

1

2

3

5

6

7

11

12

13

14

15

16

22

Yes

Yes

Quality AnalystRequest for MoreInformation from

Provider

Yes

No

19

21

22

17

18

22

20


ICD-10 Overview - Universal Benefits of ICD-10*

ICD-10 incorporates much greater specificity and clinical information to improve capture of healthcare information, which has the following benefits:

Greater coding accuracy and specificity Higher quality information for measuring healthcare service quality, safety, and

efficiency Improved efficiencies and lower costs Reduced coding errors Greater achievement of the benefits of an electronic health record Recognition of advances in medicine and technology Alignment of the US with coding systems worldwide Improved ability to track and respond to international public health threats (e.g. SARS,

H1N1) Enhanced ability to meet HIPAA electronic transaction/code set requirements Increased value in the US investment in SNOMED-CT Space to accommodate future expansion *Source: AHIMA Website – http://www.ahima.org/icd10/value-icd-10.html


ICD-10 Overview - Impacts of Not Implementing ICD-10

Failing to meet the October 1, 2014 mandate to transition to the ICD-10 medical code set could have serious fiscal and reporting consequences.

CMS will no longer accept the ICD-9 code set for services provided on or after October 1, 2014. Failure to fully transition to the ICD-10 code set will result in loss of CMS revenue.

Non-compliance with Outpatient Code Edits, including Medical Necessity Edits

Inaccurate / incomplete clinical metrics and pay-for-performance reporting that does not meet peer standards

Loss of contracts / elongated contract negotiations for renewals

Erroneous quality reporting to regulatory and third party agencies

Inaccurate / Incomplete cost management reporting

Potential adverse impact on clinical workflows / patient care referrals generated from clinical data


ICD-10 Overview – Expected Budget Risks Needing Mitigation for ICD-10

Insufficient Cash-On-Hand

Unexpected depletion in cash reserves

Decrease in Coder Productivity

Underestimation of Scope

Personnel and/or Skills Shortages

Interruption of Operations

Contractual Challenges

Unexpected Challenges with Technology or Systems

Inadequate Contingency Planning

Inability of strategic partners to achieve concurrent compliance


ICD-10 Overview - Questions

?

Documents

Copyright © 2013 Accenture All Rights Reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. Insight Driven Health