Avoiding the ICD-10 claims backlog

By Tammy Worth for Healthcare Finance News

Hospitals must strategize now to keep their revenue cycle from stalling

The Centers for Medicare & Medicaid Services has recommended that hospitals start testing for ICD-10 in 2013, but so far, many hospitals have not heeded that recommendation. That mistake could ultimately hit hospitals in the wallet.

Business intelligence provider and consultant, Health Revenue Assurance Holdings, found that nearly half of hospitals it surveyed weren’t planning to begin testing until between January and April of 2013 and the other half have not begun training or providing document improvement education to their staff.

These statistics don’t surprise Andrea Clark, CEO of the company.

“Some have not even thought about the total application and how it is important to revenue,” she said. “They haven’t thought about it whatsoever.”

She said hospitals should have started preparing “yesterday,” but if they haven’t, they should start today. And one of the first places to begin is training.

The AAPC, a medical coding training and education association, expects that training will take about 50 hours for inpatient coders. People coding hospital charts will need to know both inpatient and diagnostic codes.

Even with trained coders, however, there will still likely be a backlog of claims. Coders will be working more slowly because they are less familiar with the system. There is also an expectation, at least initially, that there will be more denials, which will take time to recode.

But for hospitals, there are a few ways to reduce the expected backlog of claims. Clark calls the next year or so the “pivotal 365”: a time during which hospitals need to begin understanding how the conversion is going to impact their revenue cycle.

“We have been dealing with hundreds of hospitals in regards to implementation and their plan to meet the deadline,” she said. “Within their implementation plans, we have found some financial holes that they may not have thought about.”

First, hospitals need to clean up “discharged not final billed” claims. Any of these bills that are not completed before the conversion will have to be dual-coded, Clark said.

Clark also said organizations will need an auditing system in place for conversion. Someone will need to be in charge of knowing if codes are going through the system correctly and claims are being paid in a reliable manner.

Another important preparation tool is mapping the codes from ICD-9 to ICD-10. Third-party payers are looking at their numbers and performing their own translation mapping based on data they have in-house, Clark said. One thing her organization is doing is taking a year’s worth of data from clients and using translation and reimbursement mapping to find where things will match to ensure that they don’t lose reimbursement dollars.

It will also be wise to get as much information as possible from CMS before conversion, said Cynthia Stewart, AAPC’s director of ICD-10 training and education. CMS is currently rewriting their coverage determination policies and will be assisting Medicaid and local carriers in rewriting theirs as well. Medicare is slated to have their policies completed before the go-live date.

Stewart urges providers that have a heavy Medicare population to get this information ahead of time. Providers can work through the new policies, take a sample of their bills and recreate what they have in their electronic medical records or paper bills.

Finally, Clark said to prepare for denials.

“They have to have a strategic plan in place in order to offset any revenue cycle stalling,” she said. “They may come to a complete halt if they don’t anticipate this now.”

Administrators need to have a plan in place with someone who will follow denials from the point they are rejected until they are sent back to the payer, she said. It should be someone who understands both ICD-9 and ICD-10. For hospitals that own physician practices, the denial tracker has to be well-versed in inpatient, outpatient and physician claims.

“They have to invest in a department with subject matter experts who can be their clean-up crew for ICD-9 and ICD-10 until this world is stabilized,” she said. “And that is going to be critical for at least six months after October 1, if not more.”