Point/Counterpoint — How Effective is ICD-10-CM?

Chaos One Cost of ICD-10-CM

By Brian Whitman

The Road Map to ICD-10-CM has been a feature in Coding Edge for a long time, but I wonder if readers really take the time to consider whether a move from ICD-9-CM to ICD-10-CM is worth the incredible effort and expense. The American College of Physicians, representing more than 124,000 internists and medical students, does not believe there is much evidence to support making such a transition, at least in the area of outpatient coding for diagnoses.

The arguments that the proponents make for ICD-10-CM seem reasonable and noble at first glance, but the proponents have failed to fully grasp the impact of such a change. Can you imagine changing over every single one of your superbills, examining each individual code to determine what it would match with? Now imagine Medicare or an insurance company trying to do this with every single coverage decision and policy it has. The chaos that would ensue trying to change every single document that contains an ICD-9-CM number would be quite extraordinary.

To give a sense of the impact, we merely need to look at the National Provider Identifier (NPI) implementation that many are suffering through right now. Those in the business have heard about the NPI for years and were all given warnings about how important it was to get. Even so, when the NPI was supposed to be required on May 23, 2007, what happened?

The Department of Health and Human Services (HHS) announced an opportunity for covered parties to participate in a contingency plan if they were not ready to use the NPI, an opportunity which many participants, including Medicare, quickly took advantage of. Even with the contingency plan in place, I hear complaints from physicians who are in desperate situations, with thousands of dollars stuck in claims because something wrong happened with the NPI.

Imagine the level of confusion of the NPI multiplied by 120,000 (the number of diagnosis codes included in ICD-10-CM) which is quite an extraordinary jump from the approximately 13,000 existing ICD-9-CM codes used for diagnoses. I spoke to well-qualified coders who tell me they would retire rather than try to take on the implementation of ICD-10-CM.

If we really felt it would cause a tenfold improvement in United States health care, maybe we could justify such a jump. But, I find it hard to believe that ICD-10-CM will improve health care. Given the limited funds we have to spend on services that are actually helping sick people, why should we ask physicians, hospitals, and insurance companies to spend the collective billions of dollars it would take to change their coding system, when they could be spending that money on electronic medical records or hiring another nurse?

While recording what we do accurately is an important concern, it must not get in the way of the most important concern of everyone involved in the health care industry, which is to improve people’s lives. Until ICD-10-CM can be shown to do this, it does not make much sense to pay the billions of dollars and endure the myriad hassles to implement it.

Long-term Benefits Outweigh Costs


I respect Brian Whitman’s opinion from the American College of Physicians. He states that moving to ICD-10-CM will take incredible effort and expense. That is true. Practitioners will need to update their computer systems, train staff, and expect payment delays from insurance carriers, to name a few possible challenges.

The Rand Corporation, under the direction of the National Center for Healthcare Vital Statistics (NCVHS), performed a comprehensive and independent study on the costs and benefits of ICD-10-CM. The Rand Study indicated that the total cost for implementation will be approximately $425 million to $1.15 billion in one-time costs for system changes and training for providers, payers and vendors, plus between $5 and $40 million per year in lost productivity. Benefits were estimated between $700 million and $7.7 billion. These are just estimates. Is it worth it? Many in health care do not see the value of ICD-10-CM.

Based on the Rand Study, ICD-10-CM is technically superior to ICD-9-CM and represents the state of knowledge of the 90s rather than the 70s. It is more logically organized and contains more detail. Benefits include:

  • Fewer miscoded, rejected and improperly reimbursed claims
  • A better understanding of health care outcomes
  • Improved disease management
  • More accurate payment for new inpatient procedures
  • A better understanding of the value of new procedures.

It may take five years to realize the benefits of ICD-10-CM. The study also suggests that the longer we wait to adopt ICD-10-CM and ICD-10-PCS, the more it will cost to adopt the system for providers in the future.

Will ICD-10-CM improve health care? That depends on how you look at it. Currently, there are 99 countries using ICD-10. The United States is still using ICD-9-CM. Our current system was modified for clinical use in the late 70s and the system is outdated. There is very little room to expand ICD-9-CM. So much of the terminology and structure of ICD-9-CM is out of date. With ICD-10-CM, the United States will be internationally comparable with ICD-10 morbidity data. There will be a better ability to describe new diseases, along with a new understanding of diseases. ICD-10-CM entails the clinical classification and terminology that will help to transition the use of clinical terminology in electronic health records.

The House passed HR4157, Health Information Technology Promotion Act on July 27, 2006. This bill was very different from the Senate version, S1418 (the “Wired for Health Care Quality Act”). Although Congress was not able to pass legislation in 2006, supporters of ICD-10-CM are busy lobbying for passage of a bill to implement ICD-10-CM. As a result, included in HR 4157 was language that called for the implementation and use of ICD-10-CM and PCS by Oct. 1, 2010.

ICD-10-CM will provide better data for quality measurement and medical error reduction, include patient safety improvement activities, improve public health and bio-terrorism monitoring, provide more accurate reimbursement rates for inpatient coding, and provide a more comprehensive pay-for-performance initiative.

Personally, I do believe two years to prepare for ICD-10-CM once Congress passes the bill will be enough time for full implementation. However, even though many of you might not be in favor of moving to ICD-10-CM, we must begin to prepare for the inevitable. Coders and providers must be prepared to move forward with system readiness and training in order to undertake this monumental task.


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