Under the Health Insurance Accountability and Portability Act of 1966, all insurance companies and health care providers who process insurance claims will need to implement the International Statistical Classification of Diseases and Related Health Problems, 10th Revision (ICD-10) transition codes by October 1, 2013, in the US. According to medical practitioners, the transition from the current ICD-9 to the new ICD-10 codes would be a daunting process that would require a large amount of planning and training. Since the Centre for Medicare and Medicaid Services (CMS) is not going to provide any grace period for health care providers and insurance companies, it is recommended that health care providers begin with the preparations for the transition as soon as possible to ensure smooth flow of claims.

ICD-10 transition would bring in a lot of positives (preventing fraud in billing, accurate representation of diseases, sharing of information, etc.) to the health care sector, but it would also require some issues to be taken care of first. Health care providers and physicians will have to train their staff to accommodate the new diagnosis codes and would also need the support of the latest software to handle this transition. Analysts fear that implementation of these new codes could actually introduce billing errors in the first year. According to a study by the Blue Cross and Blue Shield Association of insurers, billing errors are likely to increase by 10%-25% in the first year.

Billing Process with ICD-10 Codes

ICD-10 codes will play an important role in claims processing. The typical medical billing process takes place between the health care provider and the insurance company. Usually, when a patient goes to a physician for the first time, his medical record is created. This medical record contains the summary of treatment, along with other information, such as previous medical history, demographics (name, SSN, etc). Once the diagnosis is complete, the health care staff determines the quality of service offered to the patient, which is converted into a 5-digit procedure code extracted from the Current Procedure Terminology (CPT) database. The diagnosis, which was earlier converted into ICD-9 CM numerical codes, would now be converted into numerical codes extracted from the new ICD-10 CM database. These codes will not only accurately classify and reveal the exact health condition but would also prevent manipulation from the medical billing industry.

How Should Physicians Prepare for the Transition?

ICD-10 contains 68,000 diagnosis codes, as compared to the 13,000 diagnosis codes used by ICD-9. With a more than five-fold increase in the number of diagnosis codes, physicians are worried about upgrading their software and systems to re-map the claim records of their patients. These are some of the measures that physicians should take to ensure smooth transition.

•    Start preparing for the 5010 transaction standards: With the implementation of ICD-10 codes by October 1, 2013, physicians should start using the new version of HIPAA transaction standards that is 5010 to file their claims. HIPAA 4010 standards cannot handle the greater number of diagnosis codes of ICD-10. Being familiar with HIPAA 5010 standard in advance would help the physicians prepare for the transition better.
•    Outsource billing: You can consider outsourcing your billing process to another company or you can also consider using internet based claims billing programs to cut down on costs. The major advantage of using the internet claims program is that you can use the platform at no cost other than paying the fee for using the service.
•    Train your staff: It is extremely important that you train your staff to handle the greater number of diagnosis codes in ICD-10. They should also be familiar with the software systems that would manage ICD-10 implementation to avoid any disease classification and billing errors.

According to the CMS the benefits of ICD-10 transition are un-questionable and the main reason why providers and insurance companies are not ready yet is because their software systems are not ready. Although the first year of implementation of ICD-10 codes might witness some hiccups, the end result would certainly be beneficial for the entire healthcare sector.