1. A High Level Look at ICD-10 Changes & Impacts Cathy Munn, MPH RHIA CPHQ Senior Consultant April 2013 ICD-10 Awareness Session

2. Cognosante April 2013 2 Medical Record Humor… ●“Unresponsive and in no distress” ●“Nonverbal, noncommunicative and offers no complaints” ●“Irregular heart failure” ●Reason for leaving AMA – “patient wants to live” ●“I follow him for his paranoia” ●“Her stomach showed 3+ edema up to the knees.”

3. Cognosante April 2013 3 ●Historical Perspective ●Brief Overview of Transition ●ICD-9 vs. ICD-10 Examples ●Change & Preparation ●Tools for Responding to Inquiries ●Next Steps ●Questions Agenda

4. Cognosante April 2013 4 Planning/Establishing Governance ●Executive Sponsor: Marilyn Strickland ●Project Leadership – Operational Lead: Rosemary Edgin – Technical Lead: Tim Taylor ●Steering Committee ●Communication Work Group ●Stakeholders

5. Cognosante April 2013 5 Cognosante ICD-10 Team Cognosante StaffRole Contact Information Susan AckleyDirector, Standards Compliance (480) 225-0051 susan.ackley@cognosante.com Marty JensenProgram Manager (918) 630-4417 martin.jensen@cognosante.com martin.jensen@cognosante.com Kristi RuddleICD-10 Project Manager (210) 848-9123 kristi.ruddle@cognosante.com kristi.ruddle@cognosante.com Cathy MunnSubject Matter Expert (205) 835-3317 Catherine.munn@cognosante.com Jane Beth TurnerSubject Matter Expert(615) 351-8227 jane.turner@cognosante.com Rob GibranSr. Technical Consultant(206) 547-5299 Rob.gibran@cognosante.com Scott RowlandJr. Business Analyst(503) 949-9124 scott.rowland@cognosante.com

6. Cognosante April 2013 6 A Few Things To Consider ●International Classification of Diseases (ICD) – 10 th Revision – Diagnosis & Procedures ●Final Rule Published by HHS on January 16, 2009 requiring the adoption of ICD-10 on October 1, 2013 – Dates of Service (outpatient) – Dates of Discharge (Inpatient) ●February 16, 2012: HHS announces intent to delay ICD-10 compliance date ●August 28, 2012: A 1 year delay is announced by CMS, thus October 1, 2014 is new compliance date

7. Cognosante April 2013 7 ICD-10 ●ICD-10 is the updated version of codes used for: – Diagnoses for all providers (ICD-10-CM, for “Clinical Modification”) – Inpatient hospital procedures (ICD-10-PCS, for “Procedure Coding System”) ●This mandate applies to all health plans, public and private, and all providers who conduct healthcare transactions, electronic or paper. ●This only applies to ICD-9 codes; NOT CPT, DSM-IV or HCPCSs codes. ●Think about where you are using ICD-9 codes today and begin to think about how you are going to transition to ICD-10 in the future. April 2013

8. Cognosante April 2013 8 The World Health Organization (WHO) adopted ICD-10 in 1990. Since then, 136 countries have adopted ICD-10. The United States still uses ICD-9. Worldwide ICD-10 Usage

9. Cognosante April 2013 9 A Brief History ICD-8 Published in 1968 for classification of morbidity & mortality statistics Proved suitable for indexing of inpatient diagnoses & procedures ICD-9 Revised in 1979 – intent was for classification of morbidity data; reporting, evaluate outcomes DRGs – used for payment 3 Volumes with procedures listed separately Diagnosis code length = 5 characters Procedure code length = 4 characters ICD-10 Major changes in code format, length & specificity Diagnosis code length = up to 7 alphanumeric Procedure code length= always 7 alphanumeric Data trending & usage intent is still intact, however reimbursement now plays a key role in code usage

10. Cognosante April 2013 10 ICD-9 Current State ICD-9 lacks the specificity & granularity needed to accurately reflect care provided Technology & practice patterns have changed dramatically in 30 years ICD-9 has run out of codes to accurately capture current medical practice

11. Cognosante April 2013 11 Potential Risks & Challenges People Providers; Physicians, Facilities Payers/Health plans Process Medical Management – prior auths Analytics/Reporting Technology Claims Payment Systems Interfaces/Third Party Vendors

12. Cognosante April 2013 12 Medicaid Specific Impact People Claim Adjudicators Program Integrity Analysts Policy Development Staff Medical Managers and Analysts Process Medical Policy Reimbursement Analytics/Reporting Technology Updates to MMIS system Clinical and administrative systems Interfaces/Third Party Vendors

13. Cognosante April 2013 13 ICD-10 Future State Updates terminology & disease classification consistent w/current practice Expands flexibility for future updates based on technical advances Enhances research & outcomes data capture & reporting

14. Technology is the tip of the iceberg Unlike previous HIPAA implementations, the majority of the ICD-10 impact is on Business rather than IT systems April 2013

15. Cognosante April 2013 15 ICD-9 vs. ICD-10 Diagnosis Codes ICD-9 Diagnosis Code – 13,000ICD-10 Diagnosis Code – 68,000 3 -5 Characters3 -7 Characters First character is numeric or alpha (E or V)First character is alpha Use of decimal after 3 rd character Characters 2-7 are alpha or numeric Letter U is not used Use of dummy placeholder “X” for future code expansion E codes reference External Causes of Injury & Poisoning in ICD-9. E references the Endocrine system in ICD-10 V codes reference Health Status & Contact with Health Services in ICD-9 V – Y codes reference External Causes of Morbidity in ICD-10

16. Cognosante April 2013 16 ICD-10 Diagnosis Code Structure S S 8 8 A A 0 0 2 2 1 1 1 1 Category: Superficial injury of knee and lower leg Sub-categories: Other superficial injuries of knee Valid code: Abrasion of the right knee, initial encounter

17. Cognosante April 2013 17 Example: Heart Failure ICD-9ICD-10 428.0 I5020 Unspecified systolic (congestive) heart failure I5022 Chronic systolic (congestive) heart failure I5023 Acute on chronic systolic (congestive) heart failure I5030 Unspecified diastolic (congestive) heart failure I5032 Chronic diastolic (congestive) heart failure I5033 Acute on chronic diastolic (congestive) heart failure I5040 Unsp combined systolic and diastolic (congestive) heart failure I5041 Acute combined systolic and diastolic (congestive) heart failure I5042 Chronic combined systolic and diastolic heart failure I5043 Acute on chronic combined systolic and diastolic heart failure I509 Heart failure, unspecified

18. Cognosante April 2013 18 ICD-9 vs. ICD-10-PCS Procedure Codes ICD-9 Procedure Code – 4,000ICD-10 Procedure Code – 72,000 3 – 4 Digits7 Digits Numeric compositionAlpha or numeric composition Numbers 0 -9 Letters O & I are omitted Examples: Angioplasty – 3 options Artery suture – 1 option Examples: Angioplasty – 1,298 options Artery suture – 195 options The increase in the number of procedures codes is driven by the increased specificity in granularity and laterality contained within the ICD-10 codes

19. Cognosante April 2013 19 ICD-10 Procedure Code Structure

20. Cognosante April 2013 20 ICD-10 PCS Changes ●Areas of Significant Impact: – Orthopedics Fracture vs. Growth Plate Specificity Poorly Healed Fractures – Cardiology PTCA – device, approach, vessel Hemodynamic monitoring Heart Attack – Acute now classified as 4 weeks vs. 8 weeks – Obstetrics Cesarean Delivery vs. Extraction of Products of Conception Prenatal vs. Trimester

21. Cognosante April 2013 21 General Equivalency Mappings (GEMS) General Principles The purpose of the GEMs is to create a useful, practical, code to code translation reference dictionary for both code sets, and to offer acceptable translation alternatives wherever possible. For each code set, it endeavors to answer this question: Taking the complete meaning of a code (defined as: all correctly coded conditions or procedures that would be classified to a code based on the code title, all associated tabular instructional notes, and all index references that refer to a code) as a single unit, what are the most appropriate translation(s) to the other code set? From CMS “GEMs Technical FAQs”

22. Cognosante April 2013 22 General Equivalency Mappings (GEMS) ●Developed by 3M under contract with CMS ●GEMS are a starting point ●Not a “one-size-fits-all” solution ●“Cross walked” codes are not derived from service delivered ●Cannot directly communicate medical intent ●Research shows mapping for payments is risky ●Information is either lost or assumed in cross walking ●They defeat the purpose of migration – use of more granular information contained in ICD-10 ●GEMS does not provide a reliable way to translate from one code set to the other automatically – there is no “IT solution” to ICD-10

23. Cognosante April 2013 23 General Equivalency Mappings Matching ICD-9 to ICD-10 (with GEMs) ICD-10-CM (Diagnosis) ICD-10-PCS (Procedures) Exact one-to-one match24%2% Approximate one-to-one match49%12% One-to-many match24%81% No match3%5%

24. Cognosante April 2013 24 Who Will be Impacted Training & Adoption Resources – Human & Capital Providers Training & Resources Systems Upgrades &/or Replacement Financial Impacts Payers Readiness Testing Vendors

25. Cognosante April 2013 25 What Will be Impacted Analytics & Reporting Medical Policy Claims Processing & Payment Process Legacy System – Upgrades/Replacement Third Party Interfaces Technology

26. Cognosante April 2013 26 Areas of Impact Start Patient Encounter Diagnose Patient Code Claim Submit Claim Receive Claim Begin Adjudication Check Eligibility Determine Benefits Select provider & contract Check Auth Price Claim Payment & Remit Back end processes Providers change coding practices based on ICD-10 Update practice management system Update claims submission process Update system to accept claims Update benefit logic & edits Revise authorization process Claim priced based on revised fee schedules Update data repositories to accommodate new coding Revise reporting for ICD-10

27. Cognosante April 2013 27 AR ICD-10 Efforts So Far ●Cognosante worked with Arkansas DMS staff to complete a detailed assessment of ICD-10 impacts – This included a review of operational and policy documentation, and interviews with key stakeholders from impacted business units Medical policy Systems edits Reporting requirements ●All identified ICD-9 codes were translated to ICD- 10. This work was completed with input from the clinical areas within Arkansas Medicaid ●A detailed project plan is in place that monitors the progress of the remediation efforts to ensure the compliance date of 10/1/14 is met

28. Cognosante April 2013 28 Penalties for Non-Compliance Healthcare Reform - Health Plan Certification Requirements – Health Plans must file certification statement with HHS attesting they are compliant with the HIPAA standards and operating rules; – Health Plans must extend requirements to business associates (BAs), BAs must certify that they are compliant – Certification statement must be accompanied by evidence of compliance and end to end testing with trading partners. Penalties for Not Certifying – $1 per covered life (member) per day not certified up to a max of $20 per covered life per year – Double penalties if false statements submitted

29. Cognosante April 2013 29 In Summary ●The ICD-10 transition is one of the largest changes in the health care industry in many years ●There are significant opportunities to improve both the information collected and how it is processed ●There are substantial risks to payment cycles, information and business continuity & data integrity ●A well-designed approach is the key to success ●A successful outcome of this transition will result in: – Improved risk predictability – Improved vendor/partner relationships – Better understanding of business rules & process – Greater and more meaningful visibility into health care business activity

30. Cognosante April 2013 30 Helpful References ●WWW.CMS.gov/ICD10WWW.CMS.gov/ICD10 ●WWW.AHIMA.orgWWW.AHIMA.org ●WWW.AAPC.comWWW.AAPC.com ●WWW.ICD10watch.comWWW.ICD10watch.com

31. Cognosante April 2013 31 Review of Additional Materials ●Frequently Asked Questions ●Call Center Scripts ●HP Provider Wire Article ●Website Home Page – Template for submission of questions from callers ●Bullet Point Listing of AR Progress to Date ●Industry Resources – CMS Recent Updates

32. Cognosante April 2013 32 Tick, Tick, Tick…. Today we are less than 550 days from 10/1/2014

33. Cognosante April 2013 33 Parting thought…. A hero is an ordinary individual who finds the strength to persevere and endure in spite of overwhelming obstacles -Christopher Reeve