Enterprise Risk Management and ICD 10 Implementation
How will Enterprise Risk Management adapt to the implementation of the International Classification of Diseases Version 10 (ICD 10) for current and future Casualty, Health and Disability self-insurance and insurance programs?
Before October 1, 2015, providers were able to bill for products and services using approximately 14,000 codes under the ICD Version 9 system. Now, there are over 70,000 billable codes in the ICD 10 system. Are bill providers and payers ready for the questions that are likely to occur from a system that will be at least 5 times more complex?
The World Health Organization started working on the tenth edition of the International Classification of Diseases (ICD 10) coding system in 1983, finally finishing the standards in 1992. Since then, several countries around the world have adopted the standards with the United States commencing the new system on October 1, 2015.
During the next several months, we will be observing and reporting the key implications to organizations and individuals during the implementation of the new billing and payment programs. Some of the key questions for executives and attorneys to ask claim managers and administrators now are:
- Will our claims cost more money? Yes, for the costs of the underlying claim and associated administration. If your claim administrators have a very good benchmarking system for converting ICD-9 claims to ICD 10, then it may be slightly easier and not much more costly. However, because of the level of detail that the providers are now able to provide for each product and procedure, they will likely code and bill the “full experience” of the patient visit which they were unable to do prior to October 1st in the ICD 9 environment. The level of detail in ICD 10 will require more “best practice results” systems, analysis and benchmarking, plus administrative costs to eliminate unnecessary costs related to the claim. In the long run, the small additional cost of systems and administration should pay for itself by eliminating any costs for which you are not responsible.
- How long will it take to resolve our claims? It will take longer, for the time associated with review and adjudication of the claims. If the administrators have the systems to analyze the complexities of various types of claims, it shouldn’t take much longer for smaller cases. However, with the new ICD 10 billing procedures there will likely be more time for denials and appeals of the bills for complex, legacy and chronic cases. Until there is a clear way to understand and effectively differentiate between the portions of your claims for which you are responsible to pay and the portions for which you are not, it may take additional time and resources to resolve any disputed issues.
- How do I control the costs of my programs? By enhancing your teams with systems, data and professional services. Without “best practice results” systems, databases and professional service analysis and benchmarking, you may be facing programs that slide into uncontrollable future cost profiles that will become very difficult to manage.
Immediate action is necessary to address these systems and professional service issues if you are concerned with your programs that have medical treatment and pharmacy components, namely all Casualty (General Liability, Product Liability, Automobile Liability, Workers Compensation, etc.), Health and Disability self-insurance and insurance. Please feel free to call us for more information about your specific questions and needs.