Managed Care - December 2008 - (Page 15)

mutations. Also, the problem goes beyond claims basic findings, we estimate the cost of system software to any system that processes any of the changes to payers for transitioning to ICD–10 is apmandated HIPAA transactions: eligibility, claims proximately $164.64 million with a range of $110 status, remittance advice, referral/authorization, million minimum to $274 million maximum ” and claims submission acknowledgment. In other And that’s just the cost to payers. words, the transition means lots of programmers, lots of new software, and lots of integration conRedoing contracts? sultants. One of the reasons for that range is that CMS also James Cross, MD, head of national medical poltakes into account findings in a study by the conicy and operations at Aetna, hopes that ICD-10 sulting company Robert E. Nolan, even though it will refine quality-improvement activities. Quality does not agree with some of that study’s assumpmeasurement, especially in the era of electronic tions regarding the costs for renegotiating provider medical records, could also benefit. contracts. “The improved coding will also allow for more CMS, in its NPRM, states: “ [W]e do not see the quality improvement activities such as increased level of effort to be significantly greater than with ability to identify opportunities to improve care other renegotiation efforts, especially in the recent through claim and data analysis,” says Cross. “The past with the initiation of several prospective paynew coding may also help with quality measment systems for long-term care, psychiatric, urement, especially in the era of electronic rehabilitation, and outpatient services.” medical records. Providers will be able to more America’s Health Insurance Plans isn’t so readily manage their patient population and sure. In October 2006, AHIP published a help ensure that screening and preventive servwhite paper titled “Examining the Cost of ices are more widely performed.” Implementing ICD-10.” It states: “The payDespite the headaches ICD-10 might cause, ment rates negotiated between health plans many will be happy to be rid of the antiquated and providers are defined using standard diICD-9 codes. Hospitals especially want to see agnostic and procedural codes. Provider conthe changes, though they know it will mean a “Most parts of the tracts that are currently based on ICD-9 codes health care induslot of work. will have to be revised. Because the ICD-10 is try agree that this CMS notes in its NPRM that “The hierdesigned to more accurately describe the needs to be done archical structure of the ICD–9–CM proce- and that the real services that are provided, a one-to-one mapdure code set is compromised. Some chapters discussion is ping is not appropriate — and both providers what’s the timing can no longer accommodate new codes, with and payers will want a clear understanding of the result that any additional codes must be as- for it,” says Karen the payments that will be made for services Trudel of CMS. signed to other topically unrelated chapters. billed under the new code set. Each negotiFor example, new hip replacement procedures ated fee schedule will need to be updated and must now be assigned to an ‘overflow’ chapter for perhaps actively renegotiated.” procedures that are not classified elsewhere. When Baker, the CEO of Harvard Pilgrim Health Care, those chapters become full, new procedures would also admits the possibility that ICD-10 might enhave to be assigned to a chapter now devoted to courage contractual maneuvering. “Some providers procedures related to the eye.” see an opportunity to introduce changes to conEverybody agrees that the transition is going to tracts based upon the granularity of ICD-10.” cost health insurers a lot. Just what “a lot” means, Hospitals are not the only providers health plans however, is a matter of some conjecture. The Fedneed to concern themselves with. As with any techeral Register: “We estimate that changing payer sysnological change in medicine, there’s always the tems to ICD–10 may be one of the largest cost catquestion of physician buy-in. egories, but the cost is not clear and the range is For instance, under ICD-9 there are six codes for variable as payers represent a widely varied group.” sinusitis: maxillary, frontal, ethmoidal, sphenoidal, Throughout the NPRM the authors cite a study by pansinusitis, and unspecified. A review of data colRand titled “The Costs and Benefits of Moving to lected by Arkansas Blue Cross & Blue Shield found the ICD-10 Code Sets.” CMS states: “Using Rand’s that physicians chose “unspecified” on their claims DECEMBER 2008 / MANAGED CARE 15

Table of Contents Feed for the Digital Edition of Managed Care - December 2008

Managed Care - December 2008 Editor's Memo Contents Legislation & Regulation News and Commentary Medication Management Compensation Monitor ICD-10 Offers Huge Opportunity, Challenge Part D at a Crossroads Plans Can Weather the Financial Crisis DM vs. Medical Home? Tackle Prediabetes Reasonable Approach to Morning Sickness Formulary Files Tomorrow's Medicine Outlook

Managed Care - December 2008

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