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From Health Law Daily, August 4, 2014

One year ICD-10 delay is now official

By Harold M. Bishop, JD

The compliance date for the International Classification of Diseases, 10th Revision, Clinical Modification (ICD–10–CM) for diagnosis coding and the International Classification of Diseases, 10th Revision, Procedure Coding System (ICD–10–PCS) for inpatient hospital procedure coding, including the official guidelines for each (collectively referred to as ICD-10), has been officially changed by HHS from October 1, 2014 to October 1, 2015. According to HHS, the International Classification of Diseases, 9th Revision, Clinical Modification, Volumes 1 and 2 (diagnoses), and 3 (procedures) (ICD–9–CM), including its official guidelines will continue to be used through September 30, 2015 (Final rule79 FR 45128, August 4, 2014).

Background. On the January 16, 2009, HHS published a final rule (2009 ICD–10 final rule) (74 FR 3328) in which the Secretary adopted ICD–10 as the Health Insurance Portability and Accountability Act of 1996 (HIPAA) (P.L. 104-191) standard code set to replace the currently used ICD–9–CM. The 2009 ICD–10 final rule established a compliance date of October 1, 2013. Due to a lack of industry readiness, on September 5, 2012, HHS changed the compliance date for ICD–10 from October 1, 2013 to October 1, 2014 (77 FR 54664) (see Final rule requires national health plan identifiers, delays ICD-10 implementation). Then, on April 1, 2014, the Protecting Access to Medicare Act of 2014 (PAMA) (P.L. 113–93), required the Secretary of HHS to adopt ICD–10 no earlier than October 1, 2015.

Industry preparedness. In a June 2014 survey of 5,000 American Academy of Professional Coders (AAPC) members, nearly 75 percent of those responding reported that they were making significant progress toward preparing for ICD–10 implementation, 25 percent had completed all of the necessary training, 13 percent indicated that they were prepared for the October 1, 2014 implementation date, and 23 percent were actively testing with their ICD–10 vendors when PAMA was signed into law.

HHS rationale for one-year delay. According to HHS, industry has made significant progress toward ICD–10 compliance and a delay of longer than one year would slow or even stop progress towards implementation. As such, HHS has established the shortest delay permitted by law, which is one year.

HHS also believes it is important to require implementation of ICD–10 as soon as possible because ICD–10 provides greater specificity of diagnosis-related groups; improves quality measurement and reporting capabilities; improves tracking of illnesses; and reflects greater accuracy of reimbursement for medical services. ICD–10 is also expected to improve data capture and analytics of public health surveillance and reporting, national quality reporting, research and data analysis, and provide detailed data to inform health care delivery and health policy decisions.

Government and industry cost estimates. Because many government health programs were prepared for the October 1, 2014 launch of ICD-10, those systems will have to be reconfigured, resulting in estimated costs to Medicare of $5 to $10 million, and costs of $169 to $182 million to state Medicaid agencies. In addition, hospitals and large providers will be required to maintain staffing levels, renegotiate contracts, and retest systems, resulting in a total cost of approximately $409 million to $3.7 billion. HHS estimates that, in total, the additional cost to commercial entities will be $1.6 billion to $6.8 billion (see ICD-10 delayed until October 1, 2015, may add $1B to $6.8B in costs).

Effective date. HHS regulations will be amended effective September 3, 2014, to reflect the one-year delay.

MainStory: TopStory FinalRules BillingNews CMSNews CoPNews EHRNews HIPAANews MedicaidPaymentNews PaymentNews PartBNews QualityNews SafetyNews

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