Clock Is Ticking on ICD-10 Grace Period

Oncology Business News®, August 2016,

Oncology practices are facing a new deadline. When October 1 arrives, they will have to start coding with greater specificity and also get used to many new codes that CMS is going to activate.

Debra Patt, MD

ICD-10 was last year, right? Isn’t it old hat now? Think again. Oncology practices are facing a new deadline. When October 1 arrives, they will have to start coding with greater specificity and also get used to many new codes that CMS is going to activate. The one-year grace period that followed last year’s inauguration of ICD-10 is about to end.

“The next big challenge will be when the grace period is over, when you can be audited and have claims denied based on not supplying a specific enough code,” said Risë Cleland, the founder of Oplinc, an oncologyfocused healthcare consulting company based in the Pacific Northwest.

“That will also translate to what’s in your medical record documentation, because you will also have to have the medical record documentation that backs up the particular code you’re using and the level of specificity.”

Even so, Cleland said she does not expect a huge increase in denials up front. Many electronic health record (EHR) systems generate a suggested code level for office visits automatically, based on information entered into the system, she said—so that if an office is audited or a claim denied, physicians have all the documentation in the EHR to justify the codes. “More accurate and specific diagnosis coding can help to demonstrate medical necessity for the appropriate office visit level,” Cleland said.

ICD-10: The First Deadline

Roughly 1,900 new diagnostic codes and 3,650 new hospital inpatient codes will become valid come October. That’s on top of the tens of thousands of new codes introduced last year. To prepare for the higher level of accountability and the increased potential for CMS audits resulting from improper code use, practices have been analyzing their internal systems for signs of inappropriate code use that could lead to trouble when the grace period ends.The changeover last year was the biggest upgrade to medical coding in years. Leading up to the big day, doctors and administrators weren’t sure how it would unfold. They had sat through hours of training sessions about how to adapt to ICD-10, which would increase the number of diagnostic codes from 13,000 to 68,000. They had witnessed changes to their practices’ business offices and updates to EHR software. They had been told of the risks of implementing the ICD-10 update improperly and, after the change, adapting to the new classification system ineffectively. The atmosphere was thick with anticipation, questions, fear.

“It was sort of like Y2K. Everybody was panicked,” said Bobbi Buell, principal with onPoint Oncology and an expert in oncology reimbursement. “People thought it was going to be horrendous because it was such a huge change. People were afraid a lot of systems would fail.” And then it happened. September became October. Six years after the United States first intended to adopt it and 23 years after its creation, ICD- 10 was ready for prime time.


“It wasn’t as bad as they thought,” Buell said.

“Sort of like Y2K, there was not a big crash,” said Debra Patt, MD, a practicing oncologist and vice president of Texas Oncology. “Everything went on sort of flawlessly.”

Even without causing a host of disastrous problems for practices, the code set has proved to be highly complex. On one hand, it’s viewed as a necessary change that brought the United States up to speed with other countries and ushered in more precise medical record-keeping, which benefits payers and researchers. On the other, it’s seen as a headache, requiring more work for doctors and administrators and posing a hazard to the revenue cycle if coding is done inappropriately.

The linchpin of successful ICD-10 implementation, oncology professionals say, has been the EHR system. EHR systems can suggest codes and catch mistakes before billing, which will become even more important in October, when the grace period for ICD-10-specific claim denials ends.

ICD: Looking Back

Since ICD-10 was implemented, CMS has not rejected claims that, for example, fail to specify which quadrant of a breast contains cancer, a detail that does not affect billing and was not required under ICD-9. “During that grace period, as long as you get the family of codes right—female, breast cancer—they’re not going to audit you on not having used a more specific code,” Cleland said. EHR systems can make administrators’ lives a lot easier, but the opposite can also be true, Patt said. “Some of them can support oncology practices much better than others, and that’s a challenge,” said Patt, who credits Texas Oncology’s smooth transition to ICD-10 in part to its EHR system, iKnowMed. “The business operations of the practice will go much more smoothly if you have an electronic health record that can support the functions of ICD-10 and systematically review inadequacies.”An early prototype of the International Statistical Classification of Diseases and Related Health Problems, or ICD, arose in the 19th century after medical pioneer Florence Nightingale called for a uniform data-collecting method in order to track morbidity rates. Her proposal led French physician Jacques Bertillon to introduce the Bertillon Classification of Causes of Death, which many countries adopted.

In later years, health officials decided the field needed a broader range of data. Insurers, physicians, administrators, and public health officials wanted to collect data on illnesses and injuries—not just causes of death— in order to track the spread of disease, monitor spending, and standardize records for easy interpretation.

So in 1948, Bertillon’s list expanded to include nonfatal diseases and became known as the ICD. ICD-6—so named because the classification set had been revised six times since Bertillon developed it—was adopted in 1948 during the first meeting of the World Health Organization. It ushered in a new era in health statistics, marked by greater oversight, enhanced international cooperation, and a commitment to studying statistical problems of importance to public health.

After three minor revisions of the code set, WHO members began discussing structural changes to the ICD in 1975. ICD-10 would increase each diagnostic code’s length from five characters—one letter followed by four numbers—to seven alphanumeric characters. Officials envisioned it as a more useful system that would encode information about not only the diagnosis, but also disease severity and complexity and patient comorbidities and complications.

Work on ICD-10 finished in 1992, and most WHO nations had introduced some form of the code by 2010. CMS first proposed adopting ICD-10-CM, its modification of ICD-10, in 2009, but pushed back the deadline several times. “The deadline kept getting pushed back because so many stakeholders wanted the delays, so for a long time the American Medical Association was very against the implementation of ICD-10,” Cleland said. “You can’t understate the fact that it was the biggest change we’ve had in coding in this country for years and years, so there was a lot of worry it was going to be a burden on physician offices. The AMA’s biggest concern was physician offices suddenly having to change everything in their practice.”

Many offices did have to change, Cleland said. Larger oncology practices brought in new medical coders or beefed up the training of their existing staff. Smaller practices—often without medical coders on staff—hired business staff and either installed or upgraded their EHR systems. Some practices shut down.

“They didn’t feel they had either the technology or the staff with the ability to make these major changes,” Cleland said. “Most of the time, it wasn’t just ICD-10 that caused them to do this. It was just another thing they felt they were not going to be able to handle.”

Key Performance Indicators to Track for Improved ICD-10 Results

Source: CMS

ICD-10: Looking Ahead

“Practices without electronic health records were for sure a minority in oncology,” Cleland continued. “If there are any left, they certainly aren’t sustainable for much longer without [EHRs}.”The transition from ICD-9 to ICD-10 for oncology “was so much smoother than anybody even dared hope that it would be,” Cleland said. “We did not see a spike in claim rejections with the implementation of ICD-10,” she added, though the ultimate test of oncology practice readiness will come in October when CMS becomes less forgiving of imprecise coding. In a February statement, RelayHealth Financial said the denial rate for more than $810 billion in claims processed between October 1, 2015 and February 15, 2016 was just 1.6% or approximately $12.9 billion in total, which it said was not a marked increase from before the implementation of ICD-10.

Reliable EHR systems will help practices to get beyond the end of the grace period, Patt said. “It is a lot easier for practices that have robust electronic health records to adapt to ICD-10 changes, because you can have systematic ways within the health records to pull alerts to make sure that the coding has been appropriate the first time,” Patt said. “That way, you can alert physicians, if for some reason they have had inadequate coding, immediately.”

That’s useful, she said, because without proper coding it would be necessary for staff to review inputs manually—a much more timeconsuming and expensive task—or you would run the risk of having inappropriately coded claims being rejected, which would also be costly in time and labor. When claims are sent back unpaid, the delays are often several months, which slows down the revenue cycle, Cleland said.

“If practices are having a lot of challenges in how they are being reimbursed for their codes, they should be looking at a new electronic health record system,” Patt said. “Not all electronic health records are equal.”