Tuesday, September 8, 2015

The Coming ICD-10 Claims Tsunami

Who doubts that the cutover from ICD-9 to ICD-10 next month won't create at least some heartburn for providers and payers? In terms of claims adjudication and payment, there's a strong likelihood that provider claims submission volumes and health plan claim inventories (aka 'backlogs') will be noticeably impacted in the weeks leading up to October 1st; and the weeks and months following the cutover to ICD-10. Just how deep and how wide claims volumes will fall immediately after October 1st will depend on a number of factors. Similarly, a number of other factors will drive just how high claim inventories rise at the health plans and just how long increased claims inventory levels persist.

A Claims Tsunami?

The above graphic depicts how a claims tsunami may impact providers and payers. The following explains this graphic:

Period Prior to October 1, 2015

In the weeks before the ICD-10 cutover date, it's likely health plans will see an uptick in claim submission volumes  as providers make a final push to submit claims using ICD-9 codes.

October 1, 2015 

Once October 1st comes, health plans can expect a significant drop in claim submission volumes due to any combination of the following issues - among other potential impacts:

1. Lack of provider familiarity with ICD-10 codes
2. Deficiencies in clinical documentation
3. Decreases in coder productivity
4. Potential issues with EHR's and provider practice management systems
5. Technical and/or operational issues at clearinghouses and intermediaries
6. General health care industry turmoil related to Meaningful Use, EHR usability, PQRS and other recent changes

Just how deep claim submission volumes drop and how long they last will depend on the extent to which the above issues manifest themselves at provider facilities.

Period After October 1, 2015

After the above noted period of lower claim volumes and as providers gain real world experience with ICD-10 coding, claim inventories at health plans will likely grow at significant rates due to the following issues - among other potential impacts:

1. Receipt of claims previously delayed at provider-side due to above noted issues.
2. Decrease in health plan claim analyst productivity levels
3. Increased number of claim adjustments due to various healthplan and provider issues:
    - Improperly coded claims requiring adjustment or resubmission
    - Defects in application software and configurations
    - Familiarity with new business processes and potential shortcomings of those processes

Are You Moving to High Ground?

The degree to which an ICD-10 tsunami may impact providers and payers largely depends on how providers and health plans address and prepare for the above noted issues. It's critical that all parties assess where they currently stand and how much risk they are prepared to accept. The cutover to ICD-10 is less than one month away. Is your organization on high ground?

For more information, thoughts and ideas about ICD-10 and other healthcare information technology-related topics impacting healthcare payers and providers, consider following me on Twitter.

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