The federal government's plan to transition from the ICD-9-CM diagnosis and procedure code set to the ICD-10 by 2011 could cost physicians big bucks, according to a cost analysis commissioned by the Medical Group Management Association and other provider groups.
The cost analysis, which was conducted by Nachimson Advisors, puts the total cost of implementation for a typical small practice with three physicians at $83,290. A typical medium practice with 10 providers would end up spending $285,195, and a typical large practice with 100 providers would spend about $2.7 million, according to the estimate. The estimate includes costs associated with education, process analysis, changes to superbills, information technology changes, increased documentation costs, and cash flow disruption.
For example, because of the greatly expanded number of codes, a one-page superbill would no longer be sufficient to capture all the necessary codes and a longer superbill would likely be impractical. Instead, practices may need to consider using automated tools to help with coding, according to the analysis.
In a letter to the Health and Human Services Department, groups including the MGMA, the American Medical Association, and more than 100 other provider organizations and state medical societies urged the agency to provide more time to implement both the ICD-10 coding sets and the X12 Version 5010 technical standard for electronic transactions that is also being required by HHS.
The department should provide at least 36 months to adopt and implement the 5010 standard in order to accommodate testing at all levels. And physicians and other health care providers will need at least another 60 months after the industry has demonstrated readiness with the 5010 standard before adopting ICD-10, the letter said.
“Physicians are deeply concerned that a hasty transition to a new, complex coding system will result in chaos for all involved, especially if the transition is done in tandem with the implementation of HIPAA's new electronic claim standard (5010),” Dr. Joseph M. Heyman, AMA board chair, said in a statement. “Costs, training, and impact of the new rule have been underestimated by HHS, and must be readdressed before going forward.”
The move to a National Provider Identifier was one of the simplest changes called for under HIPAA, said Robert Tennant, senior policy adviser at MGMA, and it still took 4 years to complete. The idea that physicians, hospitals, laboratories, and health plans will be able to implement a much more complex transition to ICD-10 in the next 3 years is unrealistic, he said.
“History tells us that time frame simply won't work,” he said.
While MGMA supports the move to ICD-10, a rushed transition to the new system could affect patient care and financially squeeze already struggling physicians, Mr. Tennant said. There's no question that even if the time frame for adoption is extended by HHS, physicians will face significant implementation costs, Mr. Tennant said. However, if physicians and the rest of the industry don't have adequate time to prepare, the price tag could be even higher, forcing some physicians to put off needed investments such as the adoption of electronic health records, he said.
The cost estimate is available online at http://nachimsonadvisors.com/products.asp