Analyzing the Impact of the ICD-10 on the Healthcare Industry

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Analyzing the Impact of the ICD-10 on the Healthcare IndustryThe deadline for the new implementation of the ICD-10 codes in the United States is October 2013 but the question remains to be asked, “How many healthcare organizations will be ready?” ICD-10 is the 10th version of the International Classification of Diseases (ICD), which purpose is to act as a tracking tool, providing information about diseases, symptoms, social circumstances, cause of injury or disease, and so forth. The newest version of this classification will contain thousands of new categories that will help health departments from around the world compare data.

Training All ICD-10 Staff

The new ICD-10 introduces thousands of new codes and is going to require every person involved in healthcare to go through training to learn them. For example, the current ICD-9 contains about 13,000 diagnosis codes but that number will jump to 68,000 codes with ICD-10. The same scenario is true for treatment codes and staff will need to be properly trained to ensure accuracy in medical records. Any errors on the part of physicians and staff could create a negative impact in terms of medical reimbursement and revenue flow.

Improved Record Accuracy

One thing that the adoption of ICD-10 will likely promote is improved accuracy on medical records. Often, many medical procedures are lumped together under the same code, making it difficult for insurance companies to determine what they are paying for. The introduction of thousands of new codes will eliminate this issue and encourage doctors and their staff to create records that are more precise. It may also speed up payments in some cases because insurance personnel will not need to request more detailed information from physicians about any procedure or treatment that was given to a patient. (Learn more on the strategy of assessing the roadmap)

Financial Structure – Are we Ready?

There is some concern over the introduction of so many new codes with experts stating that hospitals and medical practices could be forced into bankruptcy and other financial issues. Michael F. Arrigo, a managing partner in healthcare practices with No World Borders discusses this in detail. The argument presented is that the new coding system may create an unexpected financial impact, redistributing wealth and this argument does have some merit for hospitals and medical organizations that find themselves unprepared when the change goes into effect.
However, if medical offices and hospitals prepare for this change with a business-like approach, setting up a plan that details what needs to be done with goals and deadlines for each part of the implementation, then their risk of having financial issues later on could be lower. Doctors and hospital administrators would be wise to initiate communication and cooperation between their different staff members such as accounts and receivable, IT, patient admitting, medical labs, and so forth. It is only by working together as a team that medical organizations will be able to effectively prepare for the incorporation of ICD-10.

Technology Adjustments

One thing that medical companies/organizations should be doing, is putting a plan into place to make sure that their medical software will be able to work with ICD-10. Billing software will need to be upgraded to accept the new codes and procedures that may follow with those codes, patient record software will also need to be either replaced or rewritten to accept ICD-10 codes which will be longer than ICD-9 codes. Hopefully, most medical centers, hospitals, and physicians are working with their software providers to update their software. Those who put this off, hoping that the deadline will be moved back to 2014 could find themselves in a difficult situation.

Insurance Contracts

With so many things to prepare for, medical organizations may forget to consult with insurance providers regarding their contracts. The new coding system will undoubtedly make some significant changes to the amount paid by insurance companies for services and medical organizations will need to renegotiate these contracts beforehand to avoid any problems.

Time Is Growing Short

Regardless of what physicians and other medical organizations want to believe, the U.S. Department of Health and Human Services will implement ICD-10 and it would be better to start preparing for it now. Putting together a plan and executing that plan within your organization will put you ahead of the game and make the transition to ICD-10 a smooth one.

Brian Jensen works with Dell. In his spare time he enjoys traveling, cooking and spending time with his family. He has a passion for learning and writing about all things technology. He is currently researching Learning Management Systems and the effect of education and would recommend visiting dell.com for more information.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer

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