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ICD-10 dominated 2015 healthcare news, but 2016 could see issues, experts say

It seems two-years of preparations paid off, but insiders say it may be too early to celebrate.

Susan Morse, Managing Editor

ICD-10 came, the public saw, and healthcare providers conquered.

When looking back at the the biggest news in healthcare in 2015, an informal survey of Healthcare Finance readers found no other contender even came close to defeating ICD-10 for the reign of top issue of the year.

ICD-10 had already been put off at least twice, but on October 1, 2015,  providers flipped to the new coding vocabulary, tossing the 16,000 codes of the previous ICD-9 in favor of the now 70,000 options for documenting a care episode.

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Many thought the change spelled disaster, with coding glitches tying up reimbursements and healthcare organizations losing millions in tied-up claims.

[Also: ICD-10 losers will end up being healthcare providers, panel says]

But it didn't happen. Denials held pace with pre-ICD-10 numbers, and for the most part the switch hasn't hurt the bottom line at hospitals, physician offices and other healthcare businesses.

It seems two years of preparations paid off, but insiders say it may be too early to celebrate.

"We haven't seen an increase in denials," said Diane Story, director of revenue cycle improvement at Roper St. Francis Healthcare in Charleston, South Carolina. "We are anticipating next year, once we have a few months under our belt, to measure any changes in our yield. It's too soon right now."

Healthcare policy expert Paul Keckley, from Navigant Consulting, said the perception that ICD-10 got off without issue might actually be keeping provides from preparing for the lingering negative effect. In fact, he believes the government will initiate a "re-load" of reimbursement policies, though it won't be calling what it's doing a retreat.

"They'll have to delay without admitting it's a delay," Keckley said. "There's going to be some period of forgiveness for coding error."

[Also: CMS says 10% ICD-10 claims rejected, but only a fraction due to coding issues]

Before the roll-out, the Centers for Medicare and Medicaid Services said it would give a year's grace period in the reimbursement of claims as long as they were submitted in the correct family of codes.

Some commercial insurers followed suit in initiating similar policies.

Keckley said providers will need additional relief to keep the issues at bay.

"I think there's a reluctance to admit that even with a year's delay, people weren't ready," Keckley said. "The politics of this, plus meaningful use on the provider side, it's politically a nightmare for the policy folks. I think we're going to see a reload."

There's just way more scrutiny by insurers and government payers of the appropriateness of the new codes, Keckley said.

"I think it's much more complicated than people imagined," he said.

While Keckley looks at the big picture, Story is keeping watch on ICD-10's targeted effect on finances at Roper Saint Francis, which is part of the Carolinas HealthCare System.

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Under ICD-10, some service lines will not be as profitable as others, she said.  For example, the expected yield for cardiology may be less than medicine, or orthopedics, she said.

"It's just how the new codes are grouped," Story said. "Financially  we are reducing our payments lower because of ICD-10. It could be because of a DRG (diagnostic related group) shift or lower payments because the documentation wasn't specific."

Eventually, she said, they will know whether the issue stems from not capturing the correct code or the nature of ICD-10.

Story is looking at DRGs this year and how they compare to last year. She is comparing in the codes the CCs - the complication or comorbidity -- and the MCCs -- the major complication or comorbidity -- that can drag reimbursements lower.

Also, a vendor the system uses is taking current claims data and "scrubbing" them back to ICD- 9 to compare payment.

"I'm always going to be very cautious," Story said. "I want to see everything proved in numbers before I believe it. I have someone who is analyzing our denials. I think we need at least six months to decide what our final results are going to be."

Another interesting side effect of the ICD-10 rollout was the amount of attention it received in the media, perhaps an effect of the broader consumer interest in healthcare as the financial burden falls more to patients. Of course, much of the media focus pointed to the "weird" codes now part of the ICD-10 vocabulary, which include entries for things such as "struck by an orca" and "problems with in-laws."

[Also: Everything you need to know about ICD-10, told in weird diagnostic codes (Interactive)]

Though the buzz has died off, Keckley said ICD-10 will still be a major story for the the CFOs, revenue cycle directors and other administrators who must pay attention.

"It's going to be a big story because it's capital intense, but it's an inside baseball story," Keckley said. "Unless an institution or plan fails to implement completely will it rise to a level of concern at the board level."

Twitter: @SusanJMorse

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