7 findings on the transition to ICD-10

A recent study by healthcare business intelligence provider AppRev shows there was a mostly smooth transition from the ICD-9 coding system to ICD-10, according to the company's CEO and founder, Seth Avery.

Mr. Avery shared the preliminary study results during the Healthcare Financial Management Association Region 5 meeting March 21 in Nashville, Tenn.

AppRev announced at the beginning of February that it has developed a metrics study for a "look back" on the first quarter of ICD-10 implementation.

Mr. Avery says the company conducted its own study to understand how the conversion to ICD-10 has affected its customers and other hospitals in the U.S. He also noted that hospitals can use the results to understand how ICD-10 has impacted their denial rate, especially compared to similar facilities. 

Approximately 40 hospitals have responded with data to date. The data collected was compared for the last three months under ICD-9 (July-August 2015) to the first three months under ICD-10 (October-December 2015).

Here are seven findings from the study.

1. The average for days of cash on hand showed almost no changes in any individual hospitals or on average.

2. The results for discharged not final billed showed a small spike in October but by December had returned to the pre ICD-10 levels. Mr. Avery says many experts had expected a larger backlog in the coding increasing the DNFB.

3. Hospitals in the survey group seemed to be well prepared for the coding requirements, according to Mr. Avery. Several hospitals said they "pushed" as much of the coding and billing through in September to "clear the decks" for October and ICD-10. This may account for smaller spike than was expected, Mr. Avery said.

4. Net days in accounts receivables showed no material change throughout the period for the reporting hospitals.

5. Authorization denials showed little change. Mr. Avery says this reflected cooperation between providers and payers in transitioning denials that were originally granted in ICD-9 and allowing them to still be valid after Oct. 1.

6. George Vancore of Florida Blue presented with Mr. Avery at the March 21 HFMA meeting, and told participants that Florida Blue decided to allow authorizations obtained under ICD-9 to "flow through" their system after Oct. 1.

7. Medical necessity denials, however, were up across the board with several hospitals reporting a doubling of these denials, AppRev found. Mr. Avery says several providers indicated that errors in Medicare national coverage determinations may have been a significant cause of that rate and may decrease in the near future, and additional problems with local coverage determinations may also be a short-term cause.

Based on its findings, AppRev has determined that the impact of the ICD-10 is not fully known at this time.

The company noted changes in benefits in January may also impact the outcome for hospitals, and results could change as the CMS requirement for increased specificity is implemented in October 2016 and changes in payer edits continue.

Therefore, AppRev will continue to collect data and report quarterly on the results, according to Mr. Avery. The company's goal is to increase the sample size and potentially report by state and hospital size.  


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