by Benjamin Heck, MHA
“This massive effort …calls for all healthcare stakeholders to completely rework operations for claims processing, provider contracting, medical management, quality reporting, information technology, disease management and other business and healthcare activities. ”
—Karen Ignani, President and CEO, AHIP www.AHIP.org
ICD-10 implementation may be one of the biggest challenges payers will face in the next five years. Though often seen as a compliance issue, ICD-10 offers a new way of doing business for those who embrace and plan for the change, instead of just responding to it. Given its wide-ranging impact on multiple payer departments and supporting technology, planning a strategic approach to imminent ICD-10 requirements is critical.
To develop this approach and gain a competitive advantage, payers must first:
• Understand ICD-10’s impact on virtually all payer information systems, operations, medical policy, staff, rules and processes
• Realize compliance is not just about programming system changes – it is about re-engineering business processes to harness the clinical detail ICD-10 provides
• Compress timelines and implement new processes quickly, to maximize the power of ICD-10 and ensure a smooth transition
• Communicate closely with provider networks to minimize negative transition effects and maintain goodwill
ICD-10 coding can offer many benefits, including:
• More accurate payment for new procedures. The American Medical Association (AMA) estimates the health insurance industry could save $777.6 million in unnecessary administrative costs by improving claims processing accuracy by just one percent. Role-specific training on the new, expanded code sets and meticulous system configuration that automates claim processing can reap a valuable return. To ensure accurate, consistent communication, payers and their provider networks should examine contracts to capitalize on the more specific codes.
• Fewer fraudulent claims. Implementation of ICD-10 code sets will not eradicate healthcare fraud. However, the specific, granular nature of these codes creates more accurate data, enabling rapid detection of questionable billing patterns and fraudulent claim submissions.
• Fewer rejected claims. Rejected claims cost both providers and health plans significant money. Incomplete documentation and duplicate claims submission cause most claims rejection. Better provider education and more accurate billing will lead to more prompt payment processing.
• Improved disease management. ICD-10 codes can help case managers better identify candidates for disease management programs, thereby improving member health by preventing or delaying serious complications.
• Better coordination of response to disease outbreaks. Through common coding and reporting, healthcare institutions can identify and respond to international disease outbreaks faster and more effectively.
Critical Deadlines:
There is no indication the government will move or relax the following dates. Wishful thinking is not a compliance strategy; strategic planning is the only way to remain competitive.
• January 1, 2012—HIPAA 5010 Compliance. Plans must be able to receive claims electronically using the X12 version 5010 and NCPDP Version D.0 standards.
• October 1, 2013—Plans must comply with ICD-10 rule sets.
Benjamin Heck, MHA
Benjamin Heck has more than 15 years of experience in the healthcare industry, providing IT and health plan operations consulting. He has led, and been involved with many successful core system implementations for a variety of healthcare payer organizations and has experience in information systems, project management, consumer-driven health, business process outsourcing (BPO), Medicare Advantage, ICD-10 and health payer operations. Prior to joining HTMS, he worked as a director of operations for several Mid-West health plans. Mr. Heck currently serves as a partner with HTMS, an Emdeon company, and leads the system assessment, procurement, implementations and ICD-10 practices.
ICD-10: Moving Beyond Compliance to Leading Edge Innovation
