Last week, several web publications reported on the results of WEDI’s latest ICD-10 readiness survey, conducted in August 2014. We saw the usual bulleted rundowns on how many vendors have made bits of development progress, how many health plans and providers have completed their impact assessments, how much testing has been done, and so on.

My objective here is not to go into the nitty gritty of statistics WEDI has been generous enough to gather and share, and which you are welcome to read HERE. They are illuminating, especially for ICD-10 professionals who are deep into ICD-10 projects. But to most readers of healthcare industry news reports – especially healthcare organization leaders — a list of such statistics is so much gobbledygook, when little summary analysis is offered.

This is a classic case where statistics have been allowed to obscure some overwhelmingly bad news. And the bad news about ICD-10 readiness today is all about providers.

To provide a quick background, this year’s WEDI ICD-10 survey (conducted annually since 2009) was sizeable; it had 514 respondents, 324 of which were providers, with almost one-half being health systems/hospitals, over one-third being physician practices, and the remainder being a mix of other providers. The geographic spread was fairly well distributed. A good sample, overall.

What’s the bad news? The provider segment of the industry is deep in the middle of an ICD-10 mess. This problem has been greatly exacerbated by the federal delay of the implementation deadline from 2014 to October 1, 2015.

A majority of providers – two-thirds – heaved a thankful sigh when the delay was announced, and either slowed down their conversion efforts or put them on hold. At least half of providers who reported in 2013 that they had not even conducted a basic organizational ICD-10 impact assessment, still have not done so. Most of the same providers either don’t know when they’ll do this essential first step, or “expect” to start in 2015. (A year ago only one-sixth were in this limbo state.) That 50 percent of providers also have no plans to start making actual business remediation changes until 2015. Finally, ICD-10 budgets for many providers are in greater disarray than one year ago; one-third are now concerned about budgets, while last August only one-fifth had budget worries.

The bottom line – since I am trying not to get mired in statistics – is that at least half of providers have done little or nothing on ICD-10, and many of the remaining providers have slowed down or stopped their efforts during 2014. Smaller providers have made the least progress. This problem has remained consistent for years, according to many surveys (including our own), and applies to medium-size and smaller hospitals, as well as physician organizations. Not surprisingly, most large multi-hospital systems have worked hard to be way ahead of the curve, though many are not yet ready to transact with ICD-10.

What does this dismal progress of our providers, particularly most of those that are not part of major healthcare systems, mean for industry-wide adoption of ICD-10 one year from now? Here are some conclusions:

1. The problem of federal credibility created by the second delay of ICD-10 by Congress this year remains. We have talked to several hospital CIOs and HIM Directors who remain skeptical of the newest October 1, 2015 deadline, and are only hesitantly considering a move forward on their ICD-10 projects. WEDI’s survey results echo what we are hearing. WEDI has strongly encouraged HHS to take more actions to monitor readiness and help improve awareness to address this issue.
2. ICD-10 project non-starts, delays in impact assessments and initial business changes, and lack of budgets bode poorly for moving forward to key phases of implementation that are timing dependent. Waiting until early 2015 to start work on ICD-10 will put many organizations on a collision course with events that will be impacted by external payer and vendor partner schedules, such as testing. Systems must be ready early enough (we recommend no later than April 1, 2015) to allow for both internal testing and external testing with payers/clearinghouses, and to still leave time for any remediation that the testing uncovers. Coders and the many other staff affected by ICD-10 will also need system readiness in time to prepare adequately for the final changeover.
3. A new coder staffing strategy is needed early, as it will include making increases in staff, finding external staff support, providing extensive training, and allowing for months of ICD-10 coding practice and dual coding. We are recommending that by April 1, 2015, or as soon as systems readiness allows the acceptance of ICD-10 codes, that providers begin dual coding – coding some portion of their workload in both ICD-9 and ICD-10. Providing enough time for coders to become comfortable with “real” data will be necessary to mitigate expected initial productivity losses due to the greatly increased complexity of the new coding system. It will also offer actual data for better testing and follow-on assessments of productivity and accuracy, documentation readiness, and reimbursement impacts.
4. Similarly, physicians, clinicians and other affected staff across many departments must have enough time to be trained based on their roles, and become comfortable with new documentation requirements, processes, and practices. Physicians and other documenters shouldn’t be waiting to make the transition in any case: ICD-10 compliant documentation is simply better documentation, and it is fully ICD-9 compliant.
5. Inadequately prepared organizations are likely to experience operational and revenue-related disruptions and slow-downs, starting from registration and authorizations, moving through diagnostic and procedure documentation, swinging over to actual coding, and then into billing. For example, coders who do not receive sufficient documentation to perform correct ICD-10 coding, will create more queries to get what they need. Payors who receive bills for improperly coded services will reject them, which will require re-coding and resubmission. In the latter example, longer waits for reimbursements will put heavy stress on accounting departments, and in turn, creditors.

Some level of disruption is expected within virtually all healthcare provider organizations, especially in the first months after ICD-10 go-live, based on the implementation experiences of Canada and various recent studies. But ill-prepared providers could find themselves in chaos, or at great financial risk.

If there is one word that offers a theme to this post, it is “time.” Providers are losing it. They need to take advantage of every day between today and October 1, 2015. Instead, many if not most, have wasted the precious extra time they were given by Congress’s deadline delay from this year to next. Doubts or not, wishful thinking or not….ICD-10 is inevitable.

Providers – let’s get this done.

If you’re looking for guidance on how to approach your ICD-10 implementation, watch our Re-Strategizing for ICD-10 Webinar.