State’s Medical Providers Unprepared For Costly Coding Switch

On Oct. 1, the coding system used by Arkansas medical providers for billing insurance companies and the government will change. Many providers probably won’t be ready, and if they aren’t, they will have trouble getting paid.

The federal government is requiring medical providers, including 38,000 in Arkansas, to switch from the ICD-9 system to ICD-10. Those who submit bills using ICD-9 after Sept. 30 will have their claims rejected, said Tami Harlan, deputy director of the state’s Medicaid program.

Harlan said anecdotal evidence suggests many providers won’t be prepared. She expects a scramble after Oct. 1 as providers accelerate their changeover while requesting paper checks, which will take time to process and deliver.

She has good reason to be concerned.

David Wroten, executive vice president of the Arkansas Medical Society, said of the 95 clinics that have responded so far to a survey, only 16% said they are ready to implement ICD-10 today, and almost 30% do not believe they will be ready in October. About 60% said they had provided training for coding staff, while about 40% have trained clinical staff. He said some are waiting on software vendors, while others are delaying the switch because vendors are charging excessively high rates.

Wroten said providers may assume that the switch to ICD-10, already delayed twice from its initial planned start in 2008, will be delayed again. The Arkansas Medical Society hopes Congress will create a grace period of one to two years where providers would not be penalized if they haven’t made the switch.

Harlan said a delay is not likely. The federal Center for Medicare and Medicaid Services seems determined to enforce the change, and no federal legislation is being debated that would delay the changeover a third time. She said DHS has been working on the switch to ICD-10 since 2012 and as of late has been working “feverishly.”

“I think it’s some people just don’t think it’s going to happen,” she said. “I think some people think it doesn’t apply to them. I think some people just have been slow to get ready. They just are not taking this seriously enough to make sure that their practice is ready.”

“ICD” stands for International Classification of Diseases. Its earliest version was adopted by the World Health Organization in 1893, and it has been updated periodically since.

ICD-9, which has been in use in America since 1979, categorizes all medical ailments and procedures into 13,000 codes. The ICD-10 system, which was endorsed by the World Health Organization in 1990, categorizes those procedures into 68,000 far more specific codes that detail the exact ailment (for example, which arm was broken) and its cause. The greater specificity allows for better collection of data that can spot waste and fraud, said Harlan.

But Wroten said the switchover is costly and the codes so specific as to be comical.

A study initiated by the American Medical Association estimates the cost of a medical practice switching to range from $56,639 to more than $8 million, depending on the practice’s size. According to the fact-checking site Politifact, ICD-10 includes nine separate codes for injuries related to turkeys, including one for being struck by a turkey and another for being pecked by one. Then there’s the concern that IT-related problems will occur.

“Physicians are being advised by a lot of consultants to set aside three to six months of receivables expecting there to be a lot of problems when it first switches over,” he said.

Wroten said that despite the complexity of the switch, “It’s not going to save the health care system one penny. It’s not going to improve health care services one iota. There’s no benefit to the patient. There’s not benefit to the institution. The only benefit this is for are researchers and number-crunchers, yet we’re the ones having to pay for it.”

Wroten would prefer that the United States skip ICD-10 entirely and wait for ICD-11, which the World Health Organization’s website says will be finalized in 2017.