1. Preparing for ICD-10 Department of Vermont Health Access in cooperation with Vermont Office of Rural Health and Primary Care, Blue Cross Blue Shield of Vermont, & MVP Health Care August 20, 2013

2. Topics for Presentation 1.A Brief Background on ICD-10 2.Why Documentation Will Be Critical 3.A Roadmap to ICD-10 Implementation 4.How the Payers are Preparing for ICD-10 Slide 2

3. A Brief Background on ICD-10  After repeated delays, CMS has confirmed the transition to ICD-10 will absolutely occur October 1, 2014.  This is a hard cutoff: Most payers will stop accepting ICD-9 codes on claims with dates of service on or after 10/1/14 (dates of discharge on or after 10/1/14 for inpatient stays) Likewise, payers will not accept ICD-10 codes prior to 10/1/14  All covered entities as defined by HIPAA must adopt ICD-10.  ICD-10 is only supported in Version 5010 electronic health care transaction standards mandated by HIPAA.  Transition to ICD-10 includes both ICD-10-CM (diagnosis codes) and ICD- 10-PCS (inpatient procedure codes). ICD-10-CM replaces ICD-9-CM Volumes 1 and 2 ICD-10-PCS replaces ICD-9-CM Volume 3 Slide 3

4. Diagnosis: ICD-9-CM vs. ICD-10-CM Slide 4

5. Diagnosis: ICD-9-CM vs. ICD-10-CM Slide 5  Mapping between ICD-9 and ICD-10 not always easy: 1:1 mapping 1:many options mapping 1:combination of codes mapping Some ICD-9 codes do not map to any ICD-10 code

6. Procedures: ICD-9-CM vs. ICD-10-PCS Slide 6

7. ICD-10-PCS Procedure Naming Structure Slide 7

8. Benefits of ICD-10  Increased ability to accurately reflect patients’ conditions  More accurately portrays current clinical practices and technological advances  Increased flexibility for future updates within categories  Improve payment processing and reimbursement, greater ability for automation and fewer payer-physician inquiries  Opportunities for more innovative pricing and reimbursement structures  Improved methods for detecting fraud Slide 8

9. Why Documentation Will Be Critical  The ICD-10 implementation will affect the clinical documentation your practice provides to payer organizations. Increased code detail in ICD-10 includes fuller definition of the following: Severity Co-morbidities Complications Sequelae Manifestations Causes  A large number of ICD-10-CM codes only differ in one parameter Nearly 1/3 of codes are the same except for left/right side of the body Thousands of codes differ only between “initial encounter”, “subsequent encounter” or sequelae Example: Over 1,800 codes for fracture of the radius, but only 50 distinct concepts between them Slide 9

10. Why Documentation Will Be Critical  Think of documentation in the patient record much like ordering dinner in a restaurant. Which order with the waiter is more likely to give you the dinner that you want? Mark’s order (ICD-9) Catherine’s order (ICD-10)  One early sign to detect how much you need to prepare for ICD-10 is to look at your medical record documentation Engage physicians to explain why this is important Try coding current medical records in ICD-10 to see how easy or difficult it is Determine what improvements need to be made in documentation early in your ICD-10 transition process Slide 10

11. A Roadmap to ICD-10 Implementation  Whether you are on course or haven’t started assessing your impact… You are not alone Take a deep breath and get organized There is hope, you can do this Get a jump start by using early lessons learned and tips from across the industry  Potential resources to assist you WEDI (Workgroup for Electronic Data Interchange) advises the US. Dept of Health and Human Services on all things health IT related and has taken a lead in assisting in ICD-10 implementation. Their ICD-10 Roadmap Tool Kit is here http://www.wedi.org/knowledge-center/resource-view/resources/2013/07/02/icd- 10-roadmap-tool-kit http://www.wedi.org/knowledge-center/resource-view/resources/2013/07/02/icd- 10-roadmap-tool-kit CMS has developed Transition Checklists and Implementation Guides specific to small practices, large practices, small hospitals, and payers. They are located here http://www.cms.gov/Medicare/Coding/ICD10/ProviderResources.html http://www.cms.gov/Medicare/Coding/ICD10/ProviderResources.html Slide 11

12. A Roadmap to ICD-10 Implementation 1.Prioritize your impacts by performing a risk-driven, process-oriented assessment 2.Re-think how ICD-10 will financially impact you 3.Take a hard look at your current metrics 4.Engage in open dialogue with key relationships 5.Develop a comprehensive data strategy 6.Educate your staff 7.Conduct testing 8.Plan for contingencies at time of implementation Slide 12

13. Step 1: Conduct an Assessment  Don’t start from scratch – use lessons learned from others  Discover early the high risk areas and go deep  Set priorities and “must do” items based on process risk or financial exposure  Consider the following items in your assessment: What processes do we have that use codes (e.g., practice management software, billing software, superbills, reports)? Are we at the current version of our software? Is it ICD-10 compliant? If we need software updates, when will they be delivered? How much will we need to test once they are released? Are our vendors ready? What are they doing to prepare? What is the skill level of our staff? Who needs training and what type of training do they need? Slide 13

14. Step 2: Financial Risk  Consider the following scenarios that could occur in October 2014: Rejection/denial rates may increase 100% - 200% Delay in claim turn-around time by 20% - 40% Claim pend rates may increase from 3% to 6-10% Decrease in auto-adjudication rates by payers  Understand your financial risk by performing a financial analysis of your top revenue drivers (high dollars, high volume, high risk)  Think about the 80/20 rule  Two expected large issues: Use of unspecified codes DRG shift (for hospitals) Slide 14

15. Step 3: Build Metrics  Start building baseline metrics now to measure against future performance at Go Live: Number of physician queries Response time to queries Aged backlog of queries Percent of queries vs. chart reviews Coder productivity rates Coding accuracy Aging of A/R by Payer in days and dollars First pass resolve Number and type of rejects/denials by payer Slide 15

16. Step 4: Conduct Outreach  Once you have an implementation plan, reach out and share your status and critical milestones with: Payers Vendors Reporting agencies Decrease in auto-adjudication rates by payers  Regularly communicate to ensure relationships you are dependent on are on track  Determine which payers are willing to test with you, the type of testing involved, and the timing of testing Slide 16

17. Step 5: Develop a Data Strategy  Data Strategy Options Is there agreement on clinical definitions? Is there a need to convert history? If yes, from 9 to 10, 10 to 9, or both?  Prepare a report inventory Do you still need every report that you run today? Are there new reports that you will need to monitor ICD-10 implementation and measurements? Do we have much ad hoc reporting? Does it have an impact on ICD-10? Slide 17

18. Step 6: Educate Staff  All staff will need training, but it will be specific to their role Training for physicians will differ from coders; admin staff needs basic understanding; systems staff needs training on impact on processes  Training should be “just in time”  Coding/validation staff may need additional specialty training and/or coding certification even prior to ICD-10 training  Validate updates for any checklists, “cheat sheets” or templates  Users may also need training on applications, software changes Slide 18

19. Step 7: Conduct Testing  Prepare and allow for plenty of time –this is not like 5010 testing  Define test scenarios as clinical, real world cases rather than just EDI transactions  Testing is important to identify and mitigate risk areas, such as: Incorrect, partial or invalid ICD-10 coding Potential claim processing variations based on payer’s edits for medical management policies Readiness of intermediary processing  Each provider payer processing path may be unique –ask what type of testing the payer is conducting and when  Not feasible to test with everyone – high dollar/high volume first Slide 19

20. Step 8: Plan for Contingencies  Slower submission rate of claims, higher pend/denied rates by payers may impact your cash flow – consider a line of credit  Will payers require more prior authorizations? Will they require them more in advance than before?  Due to lower productivity initially, expect overtime or additional staff needs  What is your plan if your vendor’s software changes are not ready in time?  If you have any payment arrangements that are dependent on risk adjustment, past payments may not be indicative of future payments  Develop a process to manage errors Slide 20

21. How the Payers are Preparing for ICD-10  Internal required changes have been ongoing; currently testing internally  DVHA, BCBSVT and MVP have been conducting joint weekly meetings to share status of remediation and to develop unified communications strategy  Meeting with provider groups to “spread the word”, educate, prepare  Release of an online provider readiness survey (in early Sept)  Discussions with trading partners/clearinghouses who submit to each payer  Preparing for ability of providers to test claim submissions with each payer (at beginning of CY 2014) in a test environment  Special outreach to providers deemed “high risk”  Ongoing communications at each payer’s ICD-10 web page Slide 21

22. How to Contact Us  DVHA website: http://dvha.vermont.gov/for-providers/icd-10/  BCBSVT website: http://www.bcbsvt.com/provider/resources/icd-10  MVP website: http://www.mvphealthcare.com/provider/ICD- 10_updates_and_faqs.html  The Vermont Office of Rural Health and Primary Care is facilitating training for providers at discounted rates. For information, contact John Olson at John.Olson@state.vt.us Slide 22