Countdown to ICD-10: Is Your Practice Ready?

By now, you have heard about the looming switch to ICD-10-CM diagnosis codes. The date established by CMS for converting to the new codes is October 1, 2014. While that date seems far in the future, it is not too early to start learning about ICD-10 and planning for the transition. The sooner you begin, the more comfortable you will be with the now-unfamiliar diagnosis codes when the switch occurs.

Regulatory Background

The final rule adopting ICD-10 diagnosis codes was published in the Federal Register on January 16, 2009. There are actually two code sets, ICD-10-CM for diagnosis coding and ICD-10-PCS for inpatient procedure coding. Note that ICD-10-PCS applies only to hospital inpatient procedures. The Current Procedural Terminology (CPT) codes will continue to be used for outpatient procedures.

The Department of Health and Human Services issued the rule as a modification to the HIPAA code sets standards. Thus, any health care provider covered by HIPAA is required to use the ICD-10 codes for electronic claims and other HIPAA standard transactions. Originally, October 1, 2013, was designated as the he compliance date for the transition to ICD-10. A later rule delayed the effective date to October 1, 2014, in order to allow covered entities time to prepare and to facilitate more thorough testing. CMS has signaled that there will be no further delays.

The switch to ICD-10-CM is being driven by the limitations of the current ICD-9-CM code set, which is more than 30 years old. ICD-9 contains approximately 16,000 procedure and diagnosis codes but the structure limits the number of new codes that can be added. Additionally, it was never designed to provide the level of detail that is needed for modern health care and health information technology.

In comparison, ICD-10-CM contains 68,000 diagnosis codes and provide much more detailed information within the codes. The transition will allow the United States to align itself with other nations of the world, which have already adopted the more advanced ICD-10 code set.

How are ICD-10 Codes Different?

ICD-10 diagnosis codes are alpha-numeric and contain three to seven digits, compared to the three to five digits of ICD-9 codes. Because of the increased level of detail that ICD-10 brings, there is not a one-to-one relationship of ICD-9 to ICD-10. For any one ICD-9 diagnosis, there could be several ICD-10 codes providing more granularity. Take for example, the ICD-9 diagnosis:

724.4 Thoracic or Lumbosacral Neuritis or Radiculitis unspecified.

When mapping this diagnosis to ICD-10, the following equivalences are found:

M54.14 Radiculopathy, thoracic region; or M54.15 Radiculopathy, thoracolumbar region; or M54.16 Radiculopathy, lumbar region: or M54.17 Radiculopathy, lumbosacral region.

As you can see, a more precise diagnosis is possible with the newer code set. On the other hand, some ICD-9 diagnosis codes convert directly to a single ICD-10 code: ICD-9-CM: 723.1 Cervicalgia equals ICD-10-CM: M54.2 Cervicalgia.

Making the Switch: The Date Matters

As mentioned previously, the compliance date for ICD-10 is October 1, 2014, and all payers, clearinghouses and providers will switch to the new codes on the same date. Dates of service prior to the transition must be billed using ICD-9 and services performed on October 1, 2014, and later must be billed using ICD-10. A complication is that services cannot be billed using ICD-10 until October 1, 2014. In other words, health care providers cannot start using ICD-10 codes early. They must wait until the cut-over date to begin using the new codes. Claims including dates of service from before the transition date and which include ICD-9 diagnosis codes will be denied.

A common misunderstanding is that ICD-10 codes will be required by Medicare only and that if providers do not bill Medicare, they are exempt from using ICD-10. Every insurance company (with noted exceptions) will deny claims for dates of service on October 1, 2014, and later that contain ICD-9 diagnosis codes. Some payers, such as workers' compensation and auto insurance companies, are considered non-covered entities under HIPAA. These payers may continue to accept ICD-9 codes. However, because ICD-9 will no longer be maintained after the transition and due to the intrinsic benefits of the updated codes, non-covered entities will be encouraged to also adopt ICD-10.