Unsubstantiated Claims

CMS revamps its medical claims billing classification system with the introduction of ICD-10 code sets, but will they be more hindrance than help to radiologists?unsubstantiative changes

For the past 30 years, the US health-care industry has used a classification system called International Classification of Diseases, 9th Edition (ICD-9) to identify and report diagnoses and medical procedures for billing purposes.

This code has worked well over the decades, but its structure has now become outdated, limiting the number of new medical diagnoses and inpatient procedure codes that can be created. In addition, many ICD-9 categories are full and cannot be expanded. To allow for more detail in defining injuries and conditions, HHS and CMS have mandated the implementation of a set of diagnosis codes called the ICD-10, Clinical Modification/Procedure Coding System (CM/PCS). Although CMS has declared this transition necessary, some radiologists worry that it will involve too high an investment for too little reward.

Promised Results

ICD-10 will replace its predecessor on October 1, 2014, affecting diagnosis and inpatient procedure coding for all entities covered by HIPAA. The new standard consists of two distinct parts: ICD-10-CM codes will be used for diagnosis coding, and ICD-10-PCS codes are reserved for inpatient procedure coding. ICD-10-CM is intended for use in all US health-care settings, while ICD-10-PCS is tailored only for US inpatient hospitals. According to CMS, "Coding under ICD-10-PCS is much more specific and substantially different from ICD-9-CM procedure coding."

This overhaul of ICD-9 has been heralded by some as a step toward improving payment strategies and care guidelines.2 Laura N. Pattie, economic analyst at the ACR, notes that more specific coding of injuries and conditions will, among other things, allow the government "to compare our mortality and morbidity rates with other countries, since many countries outside of the United States already use ICD-10." This will provide agencies with more detailed data to better analyze disease patterns and track and respond to public health outbreaks. Also, she says, the new system will help the government conduct more research on health services, epidemiology, and fraud and abuse. All of this, she notes, allows for more effective case management and better coordination of care and, therefore, is expected to help reduce health-care industry costs.

Although this conversion strikes many in the industry as intimidating — indeed, for example, the ICD-10-CM code set will expand from 14,000 to approximately 69,000 diagnosis codes, requiring coders to learn a multitude of new codes — Pattie says that many practices, hospitals, and universities have already begun preparations for compliance by adopting the HIPAA standards for electronic transactions through the AXC X12 Version of 5010 claim form. This electronic claim form, known simply as Version 5010, supports the three- to seven-digit alpha numeric ICD-10 codes. And because over 99 percent of Medicare Part A claims and over 96 percent of Medicare Part B claims transactions are transmitted electronically, every medical facility must up-to-date with the latest version in order to process such claims.pullquote 1

The Waiting Game

Ezequiel Silva III, MD, radiologist and chair of coding and compliance at the South Texas Radiology Group in San Antonio, admits that preparations for ICD-10 have not been at the top of his group's agenda. "We know that ICD-10 is around the corner, but we've done virtually nothing to prepare for it," he says. "All of the things that CMS is recommending — setting up committees, engaging IT and software vendors, testing claims processing procedures — we have done none of this." Why? "Because it's challenging enough for us to implement new CPT codes at the beginning of the year. We'd like to get through that transition before we start digging into a whole new set of ICD codes."

In addition, before his practice takes any significant steps toward ICD-10 compliance, Silva is waiting until both the Local Coverage Determinations (LCD) and National Coverage Determinations (NCD) are updated. The LCD is a coverage policy statement issued by Medicare contractors, each of whom establishes what procedures it considers "reasonable and necessary," and, therefore, eligible for Medicare coverage. Similarly, an NCD is a national determination by CMS outlining which procedures will be covered by Medicare.

Many radiologists worry that referring physicians will not be educated on the thousands of new codes that ICD-10 will usher in. If they do not write specific enough notes, they fear, their claims will ultimately be denied due to incomplete information. Because of this, Silva is hoping that the new coverage determinations will leave room for code sets "not otherwise specified." These sets would allow coders to enter generic or catch-all codes when a condition is not completely described by a referring physician. If such code sets are allowed in ICD-10, explains Silva, "we will just code for those and avoid our coders having to track down medical records to enable us to support new codes for highly specific diagnoses."pullquote 2

Unanswered Questions

Since many referring physicians have not yet been trained on composing notes with the specificity demanded by ICD-10, many radiologists question how cost-effective the new code sets will be. Kurt A. Schoppe, MD, of Wake Forest University, notes that "if primary care physicians don't understand ICD-10 coding and the detailed required, they're not going to code their notes correctly. Then the coders will have to spend more time sorting out their notes, taking up more of the provider's time" by asking them to fill in the gaps. If those providers refer patients for different studies without providing accompanying notes that coders can interpret into accurate and billable ICD-10 codes, then, Schoppe says, "you have a downstream effect that's multiplicative depending on how many studies those patients had. Now all of those other providers to whom the primary care physician has referred studies are going to have to come back to the primary care physician to try to get a billable code." In addition to the financial ramifications, this set of circumstances could strain relationships between referring physicians and coders.

Even if physicians take precise notes, however, the research necessary to match up their notes with a much larger pool of codes will likely slow down the claims process. This delay will, in turn, cost institutions money. "The new code sets are going to slow down my coders by 50 percent," predicts Renee C. Engle, senior vice president of client services at Management Services Network, LLC, an organization that provides medical billing and practice management services. "We've recommended that all of our clients have at least a month's worth of cash available to them in the form of a line of bank credit. We're fearful that the transition to ICD-10 might have a big impact on our clients' cash flow."

In addition to causing problems with claims submissions, Silva thinks that private payers could use the introduction of new ICD-10 codes as an excuse to re-negotiate payment rates for existing services. "Even though each new code represents an old service, payers could treat it like a brand new service and mandate that a practice re-negotiate its payment rates," he notes. "They may even re-negotiate rates for CPT codes that are affected by the new diagnosis codes. We just don't know."

For all of its promised benefits, radiologists and coders alike see many drawbacks in transitioning to ICD-10. The more complicated code sets will make it harder for referring physicians to take precise notes, in turn causing difficulties for coders to efficiently translate these notes into accurate claims. In an environment where radiologists' reimbursements are being cut while, at the same time, they are being asked to comply with an increasing number of quality measures, such as meaningful use and the Physician Quality Reporting System, these additional costs will present further financial challenges.

Whether the change will be positive or negative, the ICD-10 codes are coming. So far, the best advice is to be as prepared as possible.


By Chris Hobson

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