Failing to Prep for ICD-10 Will Cost You

With ICD-10 implementation now less than a year away, hospitals and health systems should be deep into transition planning. NYU Langone Medical Center has hired coders, installed training software, and called on physician leaders.

With just less than a year to go before ICD-10 is implemented on Oct. 1, 2014, hospitals and health systems should be deep into their planning to transition to the new code set if they want to avoid a prolonged financial setback.

Although the American Medical Association is still calling on the Centers for Medicare & Medicaid Services for another delay, none of the healthcare executives I've spoken to recently about ICD-10 expects to get more time. Instead of hoping for a long shot, they are busy preparing for the transition, because they know how important it is to give their organizations enough time to staff up, train coders and clinicians, make the necessary IT enhancements, and test, test, test.

Getting ready for the conversion is a time-intensive and costly endeavor. Michael Burke, CFO at New York University Langone Medical Center, a four-hospital system based in Manhattan, says his organization will spend between $25 million and $30 million over a three-year period to transition to ICD-10.

"The project is funded as part of our capital budget process," he says, noting that when CMS announced the one-year pushback from the previous implementation date of Oct. 1, 2013, NYU Langone stayed the course and kept its focus.

"We didn't lose momentum due to the delay. Instead we used this additional time to fine-tune our education plans," Burke says. "[The delay] enabled a more in-depth evaluation of vendors for both education and computer-assisted coding [and allowed us to] increase our workforce of coders and clinical documentation specialists."

More staff is needed because NYU Langone, like most provider organizations, believes the transition to ICD-10 will significantly reduce efficiency, at least temporarily.

"Last year, we strategically added additional coders to offset any potential productivity loss…and we don't expect to lose any coders due to attrition," Burke says. "We also decided to increase the size of our clinical documentation excellence team to assist with improving clinician documentation."

NYU Langone is using online and classroom training to get its coders up to speed and is implementing computer-assisted coding (CAC) software to aid in the tough task of coding effectively in ICD-10, which will increase the number of diagnosis codes from 14,000 to 69,000 and the number of procedure codes from 4,000 to 72,000.

"We are implementing CAC to further deflect any potential coding productivity decreases," Burke says.

His organization is also updating some IT systems and rolling out other new technology tools so it can begin dual coding early next year—that is, coding according to both ICD-9 and ICD-10 sets.

"We are in the process of creating job aids and updating EMR templates to enable clinicians to easily document according to ICD-10 requirements," Burke says. "We will begin dual coding in early 2014 in order to identify vulnerable areas where documentation is not yet meeting ICD-10 requirements."

Along with its staffing, training, and IT plans, Burke says NYU Langone is taking a "multifaceted" approach to testing.

"We plan on performing systematic testing to ensure our internal systems are functioning as expected," he says. "[W]e will also start the process of reviewing the ancillary systems' work flows with end users to ensure there are no major changes to the work flows with ICD-10. Then we will start testing with payers to identify any ICD-10 claims transmission issue [and] make any necessary corrections prior to the ICD-10 transition date. We have identified payers with whom we will be testing and will share data from dual coding."

Burke does not anticipate any issues with payer readiness. "At the moment, we have confirmation from all our major payers that they will be ready for the transition date," he says.

Many healthcare finance leaders have told me that one of the biggest challenges around ICD-10 is getting clinicians on board with the new level of specificity. NYU Langone is using its Clinical Documentation Excellence Program to achieve physician buy-in.

"We have been working closely with our physician champions and have been supported by senior clinical leadership," he says. "In general, physicians and mid-level providers have been receptive and understand that ICD-10 will require additional documentation. The education provided to clinicians is service- or specialty-specific, and we have ensured we have the support of our department chairs as we move forward reviewing documentation."

Although Burke feels confident in his organization's implementation plan, he says the task of streamlining and perfecting it is never done. "We are constantly looking at ways to mitigate risks associated with the potential loss of revenue and productivity," he says.

Which is exactly what every hospital and health system should spend the next year doing. Failing to prepare adequately for ICD-10 will prove costly, and no one can say they didn't see it coming.