What would happen to a medical practice that has one in five of its Medicare claims not properly processed by the Centers for Medicare & Medicaid Services (CMS)? It could lead to a serious financial disruption and strain the budgets of most medical facilities. However, this is just the scenario that could occur on Oct. 1, 2015 when the country carries out the ICD-10 transition if CMS does not develop suitable contingency plans.
The American Medical Association (AMA) and 99 other specialty groups from around the country called for CMS to develop contingency plans for the anticipated failures once the nation transitions to the ICD-10 code set, according to an AMA press release.
The impact to the healthcare sector upon ICD-10 implementation could be severe, leading to a multi-billion dollar disruption and significant access to care problems for Medicare patients. The latest end-to-end testing results show that the Medicare claims acceptance rate would decline from 97 percent to just above 80 percent if ICD-10 implementation occurred today.
Even this percentage on its own could lead to an accumulation of millions of unpaid Medicare claims, which would severely damage the financial outlook of the healthcare industry. However, since the end-to-end ICD-10 testing only speaks for about 1 percent of all Medicare providers, the acceptance rate in actuality may be lower, depending upon how prepared the country is for the ICD-10 transition by October 1.
“The likelihood that Medicare will reject nearly one in five of the millions of claims that go through our complex health care system each day represents an intolerable and unnecessary disruption to physician practices,” AMA President Robert M. Wah, M.D., said in a public statement. “Robust contingency plans must be ready on day one of the ICD-10 switchover to save precious health care dollars and reduce unnecessary administrative tasks that take valuable time and resources away from patient care.”
Along with creating contingency plans, the AMA and other groups are asking CMS to consider how the ICD-10 transition will impact the Physician Quality Reporting System (PQRS) and meaningful use requirements.
The reporting periods for both meaningful use and PQRS will take place more than three-quarters into the calendar year, which means the 2015 reporting data will use both ICD-9 and ICD-10 codes. This will be especially confusing for providers that are treating patients for the same condition right before and right after the October 1 deadline.
The AMA President Dr. Wah continued by explaining that the federal government may be “underestimating the impact” of ICD-10 implementation on providers that are already being encumbered by the many healthcare regulations currently in place. The AMA is focused on reducing burden on physicians and ensuring enough information is given regarding the effects of the ICD-10 transition. A major goal of the AMA is to confirm physicians are able to avoid Medicare payment penalties.
A total of 100 physician groups are asking CMS to provide contingency plans for the anticipated issues of the ICD-10 transition. Having plans in place can help avoid the potential backlog of millions of unpaid Medicare claims once ICD-10 implementation occurs.