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ICD-10 Preparedness

on 01 July, 2013

UPDATE (April 8, 2014): The implementation date for ICD-10 has changed. More information can be found in our recent blog post.

Accuracy and speed through all phases of claims data entry will ensure an easier transition to the upcoming ICD-10.

ICD-10 is the newest code set for medical claims, scheduled to replace the current ICD-9 code set on October 1, 2014. ICD-10 has about 69,000 very specific codes to represent various medical conditions, as opposed to ICD-9, the current standard which only has about 13,000.

Valid codes may also contain up to seven digits rather than just five. To ensure a fast and smooth transition to ICD-10, it is important to maintain accuracy and speed throughout all phases of claims administration.

The first step in achieving an easier transition is by maintaining compliance with HIPAA 5010, the current standard of electronic healthcare transactions which became effective on January 1, 2012. The 5010 standards are prepared for the upcoming ICD-10 implementation. Claims processing software that can produce data with 5010 compliance gives you the ability to start adapting to processing ICD-10 codes while also helping you avoid penalties and fines that could total up to $25,000 annually.

The second step for ICD-10 compliance is updating your claims processing software to handle the latest revision of the CMS-1500 form. The National Uniform Claim Committee, or NUCC, made several additions to this form to allow for easier ICD-10 adaptation. The first was the addition of an indicator for ICD-9 or ICD-10 codes in Item 21 of the form. The number of diagnosis codes that can be reported in Item 21 has increased from four to twelve to accommodate for the new ICD-10 codes. To improve accuracy, the NUCC also revised an area to identify the role of the provider and a section to add the specific date reported.

The third step is to be equipped with accurate and efficient claims processing software. The majority of claims will be submitted via EDI, but your paper claims volume may still number many thousands per month. And that volume is likely to increase when the ACA is fully implemented in a few months. A data entry system that cannot process CMS-1500 and UB-04 forms with ICD-10 compliance by October 1, 2014 will result in the complete inability to process paper medical claims.

Also, it is likely that there will be early confusion and accidental error on the side of medical providers about using correct medical codes. It is critical, therefore, for data recognition software to accurately read the codes to reduce the possibility of rejections and incorrect or delayed payments. New codes, rules and standards are already causing enough stress in the medical industry. Having the capability to enter claims data and convert it to EDI output fast and accurately will give you one less thing to worry about.

ICD-10 implementation is just around the corner. By being able to process claims, such as the revised CMS-1500, with 5010 compliance and at a high level of accuracy, you will be very prepared to adapt to the new standards.