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New Medical Codes for Diagnoses Increase Accuracy -- and Chances for Errors

With implementation just a few days away, some are concerned that NJ’s smaller practices will suffer, patient claims will be delayed

ICD codes numbers

On Thursday there will be a momentous change in the medical industry, one that’s been a decade in the making, one that will affect everyone who makes a diagnosis, fills out or processes an insurance claim, or waits -- sometimes anxiously -- for that claim to be paid.

ICD-10 (the tenth revision of the International Statistical Classification of Diseases and Related Health Problems) will go into effect. And with it, the 14,000 medical codes used to describe a diagnosis will mushroom to 69,000.

And for pessimists -- or believers in Murphy’s Law -- that means that the chances that something will go wrong between the doctor’s office and a paid claim has just increased fivefold.

Optimists and advocates for the new codes, however, say they will make insurance claims systems more precise, reducing the need for insurers to ask follow-up questions of administrators at hospitals and medical offices.

The change in codes for diagnoses and procedures has been more than a decade in the making, and involved three delays as providers expressed concern about the speed with which it was being implemented.

The introduction of ICD-10 was prompted by the fact that medical coding hadn’t been revised since 1979. This has left little room in the current set of codes, ICD-9, for some conditions.

The new codes require providers to specify the location and severity of more conditions, as well as whether the problem has recurred. For example, while ICD-9 had one code for a wrist sprain, ICD-10 has separate codes for each wrist, as well as a separate code for sprains that recur.

Sites have sprung up that ridicule the precision of actual ICD-10 diagnoses, such as code W59.22XA -- “struck by a turtle, initial encounter” -- which is part of the broader category, “contact with nonvenomous reptiles.”

What’s not funny is that the new codes may not make things better for all physicians and patients-- at least not in the short term. In addition, ICD-10 doesn’t just affect doctors and hospitals -- physical therapists, mental-health providers and any other organization that deals with medical information will have to use the new codes.

What’s more, the changeover will not impact all medical practices equally. Smaller offices may not have invested in new software to handle ICD-10.

As Larry Downs, CEO of the Medical Society of New Jersey, explained: New Jersey --like Connecticut, New York, and Texas -- has a relatively large number of small- and one-doctor practices. That’s why the society, the state’s largest doctors association, has provided small medical practices information to help them through ICD-10’s introduction, including seminars and tutorials. It also has gathered information from each major insurer in the state on how it will implement the new system. It’s also running an ICD-10 countdown clock on its site.

Robert Tennant, director of health information technology policy for the Medical Group Management Association, said the experience of small practices would largely depend on whether their software vendors provided them with updates for ICD-10. (This is open to question since some vendors may have expected the rollout to run into another delay. Similarly, some smaller practices may also have been banking on a delay, and thus put off upgrading their software.)

If a practice’s coding system isn’t ready, it will have two options, neither of which is attractive, Tennant said. One would be to submit paper claims, the other is to key in information at each insurer’s website.

“It slows down production of claims absolutely, so productivity is going to be hit,” he said.

Tennant, whose association lobbies for medical-office managers in Washington, D.C., sketched out a worst-case scenario: insurance claims denials in ICD-10 leads to small providers -- and their patients -- seeing large-scale delays in payments.

“That could literally be the death knell for a small practice that is on very thin margins to begin with,” he said.

The medical society’s Downs added, “We’ve been hearing some trepidation about whether the system will be ready,” noting that doctors have had tools available to prepare.

Further, he said that he’d be keeping a close eye in the coming weeks on whether insurers deny claims based on ICD-10 -- and whether that harms his members’ cash flow.

“Most every payer is looking to work with the physicians so that cash flow is not interrupted,” he said. “There will be an education process here for the next several months.”

Hospitals, with larger staffs dedicated to coding diagnoses, may be better prepared for ICD-10.

Joe Carr, chief information officer for the New Jersey Hospital Association, has been working with hospitals around the state for several years on the issue. He noted that a large amount of work has gone into the preparation and, while he believes it will go smoothly, he said hospitals would be ready if there are problems.

“Unlike Y2K (where) we knew within 24 hours whether the world was going to come to end, with this it’s going to take a while,” said Carr, who served as chairman of the state Department of Banking and Insurance ICD-10 implementation task force.

One reason he’s optimistic about hospitals is that they’ve been doing a lot of testing on ICD-10.

Carr said the American Medical Association pushed back on ICD-10 before accepting that it would occur in July. The long effort to delay its launch may have given some small medical practices the impression that it would never occur, he said. However, Carr credited the medical society with working to prepare doctors.

Carr said that regardless of whether ICD-10 becomes a short-term nightmare for some providers, once the dust settles the healthcare system would be better off.

ICD-9 “was just crumbling under its own weight, because it wasn’t designed to deal with all of these things we’re doing in medicine,” that have been introduced since 1979, he said.

For Horizon Blue Cross Blue Shield of New Jersey, the Thursday launch is the culmination of a seven-year process. Horizon’s ICD-10 program director Laura Lawlor started her work in the spring of 2009. Her team includes eight full-time members, although it swelled to roughly 50 at the peak of the work in 2012.

Lawlor said the new system should lead to fewer reviews by the insurer, since it will have more information about diagnoses. This could benefit both patients and doctors, she said.

“Sometimes we have to hold a claim and go back to provide more specific information,” that will now be part of the initial code, she said.

Horizon’s targeted training in ICD-10 to medical-office managers and provider groups.

“We have heard anecdotally across the industry that the smaller providers were not as quick to get on the bandwagon,” she said.

The delays required Horizon to go back to earlier work to ensure that it was still up-to-date, Lawlor said, adding that she hopes the delays help the smaller providers.

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