How ICD-10 will benefit physicians

How ICD-10 will benefit physiciansPhoto used with permission from

Physicians have reason to question the timing and value of ICD-10 as they have many competing priorities due to a multitude of concurrent regulatory, technology and industry changes. Many see ICD-10 as "salt in the wound." However, ICD-10 offers potential value to physicians if leveraged and utilized correctly. Physicians who take decisive steps to fully integrate ICD-10 into their clinical practice stand to benefit in several ways.

So, yes, ICD-10 implementation is an investment in time, but it presents physicians with five benefits that have the potential to be major game-changers.

1. Grow compensation and reimbursement.
ICD-9 codes were not originally developed with reimbursement in mind. ICD-10, however, offers a more decisive system to determine payments by offering greater detail on the quality of the care provided. In turn, government payers, insurers, hospitals, health systems, medical groups and others will use ICD-10's granular data to determine accurate and fair physician compensation and reimbursement for goods and services.

Some hospital systems with employed physicians have been offering compensation plans based on performance for several years. For example, Geisinger Health System in Danville, Pa., has a pay- for-performance (P4P) program that bases 40 percent of incentive payments on quality goals (Cheung- Larivee, 2012). The New York City Health and Hospitals Corporation recently announced that more than 3,500 employee physicians will receive bonus payments tied to meeting quality measures, such as lower readmission rates (Caramenico, 2013). With the arrival of ICD-10, quality incentives are in jeopardy if the physician does not document to the level needed to attain the correct and more specific code selection. This is because the code is a reflection of how severely ill that patient was, and a sub-optimal code in ICD-10 will not provide support on why a certain amount of care was needed.

Under the government’s Value-Based-Purchasing program, physicians who do not provide precise documentation (e.g., laterality, specificity, anatomic site, etc.) to support the specificity of ICD-10 will experience reduced payments. On the other hand, it is important to note that ICD-10 does not require a change in how physicians practice medicine or treat patients. Rather, it demands more accurate documentation and gives physicians more diagnostic choices to capture new data to ensure they are paid for the complex work they perform.

Another example is documentation and payment on new and cutting-edge procedures. New procedures are problematic for coding purposes. In both CPT and Volume 3 of ICD-9, they are often given an unlisted procedure or an unspecified code. With ICD-10-PCS (Procedure Coding System), which will be used for inpatient procedures, the codes are going to be created based on the surgeon’s documentation in the operative report. The code will be built based on the type of surgery, body system, root operation, body part, approach, device and any qualifiers that the surgeon includes in the documentation. So, for inpatient procedures, there are no limitations in code selection because ICD-10-PCS codes accurately reflect the goal, the location, and the steps of each procedure without the restrictions of procedural naming conventions and agreed-upon methodology. Often new procedure codes were not covered by government or private payers, according to an ICD-10 RAND report (Libicki & Brahmakulam, 2004). The upshot: payers may cover more procedures, reject less, pay faster and reimburse more accurately.

2. Determine severity and prove medical necessity.
ICD-10 codes are much more granular and provide choices that will allow the reality of the patient’s condition to be encapsulated into a code based on the documentation.

Severity of Illness is a term often used in the inpatient hospital setting that indicates the seriousness of the pathophysiologic changes that have occurred, along with an indication of the disease’s complications. It provides a basis for evaluating resource consumption and the patient care provided. Simply put, Severity of Illness reflects the patient’s level of sickness. As a general rule, sicker patients are more expensive to treat because they utilize more resources, have a higher rate of complications, and predictably, have worse outcomes. ICD-10 codes will support documented Severity of Illness data capture and reporting, because ICD-10 codes carry much more descriptive information than ICD-9 codes. In fact, Severity of Illness is fast becoming a buzzword that physicians will hear more and more across all settings with the dawn of ICD-10. ICD-10 is actually the tool physicians can use to make sure the chart reflects how sick their patients really are to a third-party payer, an auditor or the public.

Closely aligned to this, the Centers for Medicare & Medicaid Services (CMS) -- with other payers following suit -- is going to increase scrutiny around the use of the non-specific codes and lack of documentation for services and procedures. ICD-10, however, with its improved code descriptions, offers accurate and specific disease descriptions, which will better support the services, treatment and procedures the physician has prescribed. The specific codes of ICD-10 may simplify prior authorization or eliminate the need for an appeal, saving the physician and staff valuable time and reducing payment delays.

[See also: Applying ICD-10 to Crohn's disease]

3. Ensure your strong reputation.
With the advent of healthcare industry changes brought on by Value-Based Purchasing, documentation becomes akin to a physician’s social media page. Everybody sees it. Once the care has been provided, documentation becomes the basis for the ICD-10 codes, which will more accurately reflect the quality of care provided by a physician. ICD-10 education and utilization will trigger some needed documentation improvements, which in turn will reflect a code selection that will tell a more complete story of the gravity of the patient’s illness, the complexity of the services, and utilization of resources.

4. Reduce the hassle of audits.
ICD-10 codes will allow the physician’s documentation to be translated into a more accurate clinical picture, thereby reducing the chances of misinterpretation by third parties, auditors and attorneys. Understanding ICD-10 and implementing the required documentation will help save time and resources during a Recovery Audit Contractor audit or, even better, prevent the audit in the first place. Insufficient documentation, on the other hand, may lead to scrutiny and potentially a take-back by CMS or other payer.

5. Gain access to better clinical information.
ICD-10 will trigger a deeper level of clinical detail in the medical record. This information can be used to reduce errors, impact multidisciplinary care and provide improved assurance of appropriate reimbursement. It also offers significant data mining and research opportunities. For example, ICD- 10 codes allow a much greater explanation and insight into adverse events. This includes complications, hospital-acquired conditions, falls and expected adverse outcomes. "The increased specificity of the ICD-10 codes is more flexible, which means that emerging diseases can be quickly incorporated. The higher level of detail in the codes provides the ability to more precisely code the diagnosis," (AMA, 2012).

Adapted with permission from a white paper titled "Helping Physicians Succeed in an ICD-10 World" by Tom Ormondroyd, Bruce Scott, MD, and Christian Oliver.

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