D'Arcy Gue

Three Ways ICD-10 Codes Will Put Your Revenue Cycle at Risk

November 6, 2013

ICD-10 4 Minute Read

ICD-10 is already here.   It may be 11 months before the implementation date, but healthcare providers are feeling the pain today as they struggle to quickly implement systems, processes, and training. When I talk to CFOs, many are anxious about the negative effects that ICD-10 threatens to have on their revenue cycle. There has been much discussion about the most direct impact – on the productivity of coders.   But other areas of the revenue cycle also will be significantly impacted by ICD-10, and must be addressed in your preparations.

Impacts on Scheduling and Registration  

Coders are not the only people in the hospital who code. Outpatient registration and dollar signsscheduling staff are often called upon to take a physician’s handwritten diagnosis (or worse, the patient’s verbal rendition of the handwritten diagnosis) and come up with appropriate ICD-9 diagnosis codes. The challenge here isn’t in coming up with ICD-10 codes for common diagnoses; it’s in the times when there won’t be enough information on the order to determine the appropriate code.

The usual workflow goes like this: the registrar or scheduler picks up the phone, calls the physician’s office, and waits until the admin answers, retrieves the patient chart, and interprets the noting.   At best, this adds three to five minutes to registration time. With ICD-10, the volume of these calls will increase, and unfamiliarity with the new codes in the physician office will cause significant delays that will dramatically impact throughput.

Impacts on Volume of Denials 

As we illustrated in our Financial Impacts of ICD-10 Infographic, claims denials are expected to increase greatly – perhaps 200-300%.   The recent pilot program results from HIMSS and WEDI reported an accuracy rate of only 63% among properly trained coders.  Couple that disconcerting information with payers’ new claims processing rules and ICD-10 to ICD-9 translation, and what will be the result? Dramatic increases in claims denied, which will require appeals, documentation, and other follow-up.

Loss of Accumulated Knowledge  

The informal knowledge bucket that the insurance follow-up team has filled up over the years is not often considered in the context of ICD-10 compliance, but it’s an important factor. In every hospital business office I’ve worked in, insurance follow-up is segregated by payer, allowing the representative to build up a personal familiarity with individual payers’ claims processing rules, many of which are code specific. For example, “Oh.  That denial code for that diagnosis will get paid on appeal; we just need to send medical records.”

The conversion to ICD-10 diagnosis and procedure codes will make all of that informal knowledge suspect. Many issues that are now handled almost automatically using that entrenched knowledge base, will require a phone call to the carrier.  Imagine the number of phone calls from your representative increasing proportionally to the number of denials (2-3x).  Then add in the difficulty of reaching the payer because their number of inbound calls also goes up 2-3x…

The newly empty knowledge bucket after ICD-10 will also negatively impact registration and scheduling. Most registrars can tell you today, without referring to any resources, that the code they use for type-I diabetes is 250.01, and probably identify 50-100 other codes off the top of their heads.   It may take a long time to readily recall that E10.9 is the corresponding code for type-I diabetes in ICD-10 and to memorize the other common codes.

Some strategies for dealing with ICD-10 revenue cycle impacts include:

  • Provide and reinforce detailed training, with special attention to non-coders who perform coding functions as part of their job, such as in patient access and scheduling.
  • Increase staff, plan for overtime, and carefully select work that can be performed by temporary employees.
  • Construct helpful job aids, with the most commonly used codes for your facility mapped out.
  • Communicate thoroughly with providers who regularly order tests at your facility. Outline the ICD-10 code requirements and specificity for all tests expected to be conducted after October 1, 2014.

Because of the volume of impacts that the ICD-10 implementation has on individual processes, process redesign, and workflow — planning for ICD-10 is critical and should already be well underway throughout the revenue cycle.  Delays in preparation and misconceptions regarding the amount of work ICD-10 will require throughout the revenue cycle represent significant risks to the financial health of your organization.

Don’t fall victim to the risks of ICD-10 impacts. For more information, download our report on the risks of ICD-10. The report provides details on the risks and risk mitigation strategies for your revenue cycle processes.



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