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Strategies for your ICD-10 implementation plan

Medicare Weekly Update, January 20, 2009

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Editor's Note: Kimberly Anderwood Hoy, director of Medicare and compliance for HCPro, is the author of this week's "Note from the Instructor."

Last week, HHS announced October 1, 2013, as the final implementation date for ICD-10-CM/PCS. ICD-10 was adopted for all diagnosis coding and for inpatient procedure coding. Also adopted were the standards changing the electronic claim format to accommodate the expanded ICD-10 codes.

For providers who have not begun preparing for ICD-10, this is a wake up call to start preparations. Not only will coders need to be retrained in the new coding system, but many other systems will have to be updated to accommodate this change. Providers will need to work with virtually all of their software vendors to implement this change. One of the most difficult parts of the transition, as we have experienced with the NPI, is not our own preparations, but awaiting CMS guidance on changes to their systems and policies. 

For example, systems for identifying services that may not be medically necessary, triggering an ABN, are dependent on the ICD-9-CM codes in Medicare’s current policies. These systems, forms, and related items will have to be updated to ICD-10 codes when updated policies are available from Medicare and its contractors. However, updating medical necessity policies may not be at the top of CMS’s list for preparation for ICD-10, considering the number of other things in Medicare systems that have to be updated. Hospitals may have to wait until just before or even after the implementation date for the ICD-10 medical necessity policies to be updated, delaying the hospital’s implementation.

In some ways, CMS’s preparation for ICD-10 will be more extensive than for providers.  The entire Inpatient Prospective Payment System (IPPS) is built on the ICD-9-CM codes, which will have to be transitioned to ICD-10. Additionally, CMS will have to have enough data from ICD-10 coded claims to set rates for the IPPS system, generally two years’ worth. This may mean that, for a time, providers will have to report more than one set of codes: ICD-9 for calculation of their payment, and ICD-10 for data collection and future rate setting. 

Hospitals should make a work plan to deal with ICD-10, but their plan will have to build in significant flexibility, as the time frames will often be dictated by when CMS guidance and policy information becomes available. Hospitals may even need to be prepared to run parallel systems for ICD-9 and ICD-10, as they currently do now for National Drug Codes, which CMS has not adopted, but which have been adopted by most other payers for reporting hospital drugs. Hospitals will have to monitor CMS’s implementation efforts carefully over the next few years and prepare for contingency plans when guidance and policy information from CMS is delayed.

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