Physicians’ practices have been so slow to prepare for the ICD-10 transition that the American Medical Association (AMA) and other physician groups have warned of a healthcare industry crisis starting October 1, the ICD-10 deadline. They have strongly campaigned for a reprieve for physicians, supporting one Congressional bill that would kill the ICD-10 initiative outright, and two others that would delay penalties for up to two years. CMS has answered the call by announcing new relief measures  — for physicians and eligible professionals (EPs) only.

CMS announced Monday July 6th  that it will adopt proposals made by the AMA to ease the transition to ICD-10 coding for physicians and other EPs. These measures apply to Medicare Part B claims only. They do NOT apply to hospitals or other entities covered by ICD-10 regulations. ICD-10 codes will continue to be required for dates of service beginning October 1, but the impact on physicians/EPs will be eased as follows:

• For the year beginning October 1, Part B claims will not be denied because of a lack of specificity, provided that the code submitted is in the correct code family.
• For quality reporting completed for program year 2015, clinical quality data review contractors will not subject physicians or other EPs to penalties related to the additional specificity of ICD-10 diagnosis codes, as long as a code from the correct code family was used.
• CMS will not deny informal review requests based on 2015 quality measures if the provider’s only error(s) is/are related to the specificity of the ICD-10 diagnosis code, again, as long as the EP used a code from the correct family. CMS also indicated that EPs will not receive a penalty if CMS experiences difficulty calculating the quality scores for Physician Quality Reporting System (PQRS), Value Based Modifier (VBM), or Meaningful Use / MIPS (MU) due to the transition to ICD-10 codes; and that advance payments would be authorized if CMS is unable to process claims.

There is no doubt that this is good news for physicians. These measures help to mitigate some significant financial risk related to the transition. However,  they do nothing that will allow physician practices to continue using ICD-9, or to slow down their ICD-10 preparations.

• ICD-10 codes are still required beginning 10/1/2015. ICD-9 coded claims will be denied.
• The flexibility guidelines only apply when the lack of specificity is the only error. Other errors will still be denied.
• The flexibility offered is for Medicare claims only. It does not apply to other programs, including commercial payers.

 CMS’ concessions to “physicians only” may be bittersweet for any hospitals that are behind on their ICD-10 preparations. Recent surveys have indicated that many small hospitals in particular — up to 50% —  have made little progress in the last year. It would appear that hospitals that may have been holding out for another delay or some other relief will be disappointed.

This development should be a strong wake-up call to hospitals and other covered entities. They have not been given the break physicians are receiving.  ICD-10 remains on target for October 1, penalties and all.

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