Change has nearly achieved buzzword status in today’s world. Change is a word used to describe, in usually somewhat dramatic fashion, virtually everything. This ubiquitous use of the word has drained the meaning – I go into the local coffee shop and there is a huge poster announcing the fantastic change in their brand of skim milk – their non-fat lattes are new and improved because of this profound change, hmmm change, I guess for me more of an FYI (and their lattes still taste the same to me). I see huge electronic billboards announcing a speed limit change from 60MPH to 70MPH and it comes accompanied with the concerned news reporter standing on the side of the freeway with cars whizzing by describing how this change will decrease commutes by 3 – 5 minutes (except for the fact that from 7-9AM or 4-6PM the speed limit could be adjusted to the speed of light and I still never really exceed 35) – hmmm change again, I guess, but not very impactful for the average commuter. Now let’s talk about some change that could bring the word change back into the limelight – the conversion from ICD-9 to ICD-10 coding systems. You might be saying to yourself, whatever, if this was such a big deal where is the hype? I ask myself the same question – are folks ignoring this truly honest and profound change or is it being overshadowed by the “land grab” called ARRA/HITECH/Meaningful Use. I postulate it is all of the above.

Sometimes when change is so profound, the ostrich approach kicks in and the ‘ol head goes directly into the sand (I personally prefer putting my hands over my ears and humming). I think as an industry we a collectively doing exactly one of those two things. Despite the profound nature of the change, ignoring it will not make it slow down or go away, this is coming and it has the momentum of freight train with a full head of steam. In my case when I run into change this profound and discover humming loudly does not drown out the train’s whistle, I stop humming and set down to evaluate situation. How can the change be assimilated? What is the impact? How will I make a plan of action?

With this approach let’s evaluate the situation, by breaking it down. There are two direct components to the ICD-10 conversion and one “influencer”. The two direct components are the HIPAA 5010 transaction set “cutover” on 1/1/2012 and the actually conversion from ICD-9 to ICD-10 code sets on 10/1/2013. The influencer is Meaningful Use. Is one more important than the other – not really, if your site’s intent is declare meaningful use to receive the ARRA/HITECH incentives then you must sustain meaningful use in order to receive your most likely already spent incentive moneys – a big stick, 5010 has to be in place in order to move messages containing ICD-10 codes. If the 1/1/2012 date is missed Medicare/Medicaid reimbursements stop – another big stick. Then ultimately the codes set conversion on 10/1/2013, miss this reimbursements go away – again a huge stick. The challenge with these changes is that in most situations the change that carries a stick usually has a carrot too. Unfortunately these things simply do not – they are all stick!!

How can the change be assimilated? Careful planning, equally careful execution of the plan and sophisticated program management are the answers. With the code set conversion virtually every department will be effected by the change from IT, to care delivery, to billing to medical records – no one is spared. So careful plans must be developed for each area and a program management office chartered.

The impact is luckily quite straightforward and quite ugly. Miss the dates and reimbursements will cease until you complete the conversion. This conversion could have a profound impact for cash flows. While everyone will get through the conversion eventually, if you miss the dates you could find yourself in the middle of the Sahara desert of cash flow, in other words the cash will dry up like the rain in the Sahara.

So what is the plan? First your site should have a plan and approach for sustaining Meaningful Use status since the initial declaration of Meaningful Use most likely entailed spending all of your projected incentive payment to achieve the declaration. Miss sustaining meaningful use and what was once considered “found money” will now have significant impacts on your budgets (capital, operating and FTEs) since the found money was spent before it was all found.

For HIPAA 5010 transaction set conversion. A brief background – the 5010 transaction set provides the basis for syntactic interoperability or the ability to exchange messages containing data between sites. Another way of looking at it - 5010 is to reimbursement data exchange as HL7 is to clinical data exchange. The cutover date is 10/1/2011 and industry best practices are suggesting that interfaces are running on parallel “production ready” systems 2 quarters prior to the cutover. This means all work should be complete by 4/1/2011 – a very short 10 months from now (technically speaking Level 1 compliance is actually January 2011, but… ). Based on that every site should have a high level plan for 5010 that should contain (non exhaustive list):

1. Develop cost estimates for 5010 conversion based on initial workplans
2. 5010 training or reviews (understand the problem space)
3. A review of existing interfaces to ensure 5010 compatibility
4. Develop robust test plans that exercise edge cases and not just the “norm”
5. Obtain/construct realistic test data
6. Construct development and test environments
7. Develop validation procedures with your external data recipients
8. Create a plan for running parallel systems
9. Develop “cutover” and rollback plans from test to development
10. Execute test plans
11. Document your environments
12. Understand the impact of a rollback on cash flow

For the ICD-10 conversion. The importance of this conversion can be summed up in two words – specificity and laterality. A little background, the current ICD-9 code set is a 5 numeric character code; ICD-10 is a 7 alphanumeric code. These additional two characters will allow significant increases in specificity of the coding; ICD-9 has approximately 13,000 codes while ICD-10 has greater than 68,000 codes. Laterality is the ability to specific right and left sides, e.g., a broken left leg. So, here are several components which should be part of an overall ICD-10 plan (again not exhaustive).

1. Keep in place the PMO and other project management functions established for 5010
2. Ensure all components identified in the 5010 suggestions are included in the ICD-10 plan
3. Review all systems and interfaces to ensure compatibly with the 7 alphanumeric ICD-10 codes
4. Review clinical and billing department workflows.
5. Develop training plans being cognizant that your organization will be competing with virtually all other organizations in the country for a finite pool of resources
6. Review reimbursement schedules with your payors. Industry pundits believe that the ICD-10 conversion will enable payors to adjust (read decrease) reimbursement based on specificity and laterality

Also, make sure your plans cover the cost of the overall conversion. These estimates range from $84K for small practices to $2.7M for larger sites. As an industry, the overall cost estimates for the conversion hovers around $1.64 billion split among three categories

• Training costs approximately $356 million
• Lost productivity approximately $572 million
• System changes approximately $713 million

As I reread this blog I feel like that concerned new reporter standing by the freeway, unfortunately the ICD-10 conversion is far more impactful than a 3-5 minute adjustment to a commute – it is not optional and will have to be absorbed as a cost of doing business. So how is that for some real change?!

Please contact us at Santa Rosa Consulting for unique and innovative approaches to assist in the planning for the ICD-10 conversion and assimilate the huge volumes of change!