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New medical coding system taxes hospital IT resources

Lucas Mearian | June 13, 2011
A new federally mandated medical coding system designed to better track diagnoses and treatments is affecting dozens of core applications for healthcare providers and insurance payers, and is requiring a massive overhaul of IT systems that some say will be nearly impossible to complete on time.

A new federally mandated medical coding system designed to better track diagnoses and treatments is affecting dozens of core applications for healthcare providers and insurance payers, and is requiring a massive overhaul of IT systems that some say will be nearly impossible to complete on time.

Medical providers and insurance payers are required to move from the current ICD-9 coding system to ICD-10 by Oct. 1, 2013. The effort has already been under way since 2008, yet most hospitals have yet to begin the change-over, says the American Hospital Association, an industry group with more than 5,000 member hospitals, health systems and other care organizations.

The move from ICD-9 to ICD-10, which changes out about 15,000 codes for approximately 68,000 new ones, comes at a time when care providers are already under the gun to implement and prove to the federal government the meaningful use of electronic health records (EHR).

ICD-10 was published by the World Health Organization in 1992 as a way to add the tracking of mortality rates to the coding standard. Since that time, additional coding has been added to provide a more comprehensive method for tracking diagnoses and medical treatments.

The Centers for Medicare & Medicaid Services (CMS) is in charge of regulating both "meaningful use" and ICD-10 implementations. So-called meaningful-use standards come in three phases, and hospitals are required to implement Phase 1 this year. A proposed rule governing Phase 2 is targeted for publication in late 2011 or early 2012, the agency says.

In the meantime, ICD-10's deadline looms, and many hospitals and Medicaid providers are well behind what is considered by most to be a multiyear implementation.

"Quite frankly, the holdup is, it's a big undertaking and it took them a while to get under way. Everybody's started, but a large percentage of hospitals are in the heavy analysis stage or they're just starting," said Casey Corcoran, vice president of commercial solutions for healthcare at General Dynamics Information Technology, a vendor offering ICD-10 consulting services.

Earlier this year, the CMS conducted a teleconference to help payers and providers understand their responsibilities in implementing ICD-10.

Christine Armstrong, a principal at Deloitte Consulting, said in a report that ICD-10's complex code and its impact on EHRs, various billing systems, reporting packages, and other decision-making and analytical systems will prompt major upgrades or the replacement of current systems.

The changeover will probably cost larger hospitals between $2 million and $5 million, and large care groups as much as $20 million, said James Swanson, director of client services at Virtusa, an IT services and consulting company.

 

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