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ICD 10 � CM and ICD 10 � PCS Readiness Planning by 5W6wBuA

VIEWS: 26 PAGES: 101

									   The Perfect Storm is
coming to The Revenue Cycle




  40th Annual Maine AAHAM Meeting
            Ogunquit, Maine
         September 13-14, 2012
Is Your Entire Revenue Cycle Team
             Prepared
      for the Perfect Storm?

   Lorrie Borchert, MA, CPC, CPAM
  Rob Borchert, MBA, FHFMA, CPAM
                              “Topical Pieces”
       Basic Knowledge of Regulatory Changes
       Understanding the “pieces” to the puzzle
       Healthcare Reform coming our way
       Understanding the Difference between ICD-9
        and ICD-10 with Examples
       Managed Care Contract Impacts
       ACOs and New Medicare Plans
       Insurance Plans are looking forward
       Single Payer “State”

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                     Perfect Storm Waves
     •    Aftermath of moving from 4010 to 5010
     •    EHR choice, implementation and value
     •    (Is)Was meaningful use meaningful?
     •    Healthcare Reform – Now to 2015 and beyond
     •    ICD-9 to ICD-10 Impacts
     •    Managed Care Contracts – Be Aware!
     •    ACOs are real !! (But…)
     •    Medicare Future Payment Plans
     •    Insurer-Run Care in Retail Clinics
     •    Single payor System
     •    Anything New?????
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        Aftermath of Moving from
              4010 to 5010

                       Compliance Date
                        June 30,2012


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                     5010 HIPAA Hurdles
•    837: Claim Submission for P, I, and D
•    835: Remittance Advice for all
•    270/271: Eligibility and Response
•    276/277: Status Request and Notification
•    278: Referral Certification and Authorization
•    834: Benefit Enrollment and Disenrollment
•    820: Premium Payments


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          5010 Experiences
• Government:
  – Missing 835s
  – Connection and response
  – EDI Unanswered Questions
• Third Party Payors
  – Missing 835s
  – “We are full, can’t do anymore electronically”


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             5010 Systems Monitoring
      •    Medical Necessity
      •    Contract Modeling
      •    Contract Management
      •    Primary and Secondary Billing
      •    Discharge Planning
      •    Abstracting and Coding
      •    DRGs and APCs Groupings
      •    Chart Deficiency
      •    Encoding

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      5010 Cash Flow Impact
• Not as dynamic as predicted
• Slow in transition but improving
• August – there are still some matching of
  EFTs and EOBs

• What has been your experience to-date?



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    EHR , Implementation +
    Value = Meaningful Use
        But Are There
         Other Issues?



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     EHR Technology and Patient Care
          EHR has an impact on clinical outcomes,
             utilization and workflow processes
    •    Streamline, structure order process – CPOE
    •    Improved clinical messaging and workflow
    •    Ensure completeness, correctness !?
    •    Charge capture and display
    •    Supply patient data
    •    Drug authorization, formulary approval and
         interaction

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      EHR Technology and Patient Care
             EHR has had “other” impacts on clinical
                outcomes and workflow processes

                   “If The Doctors Don’t Use It Correctly,
                            Nothing Else Matters”

      • HIM audit practice increase “upfront”
      • Increased “re-bills” to third parties
      • Increased request for medical records

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        Moving to Stage Two of
          Meaningful Use
• Requirements to be met by 10/1/2014
• Core Objective: secure messaging to
  communicate with patients
  – CAH: automatically track medication admin record
• Patients on-line access to health information
• Group reporting to submit attestation info
• Summary of care document exchange – 50%
  within group; 10% outside group
• Outpatient Lab Reporting for Hospitals
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           Moving to Stage Two of
             Meaningful Use
• Eligible Professionals must report on 9 out of 64 total clinical
  quality measures (CQMs)
• Eligible hospitals and CAHs must report on 16 out of 29 total
  clinical quality measures
• ALL providers must select CQMs from at least 3 of the 6 key
  health care policy domains:
   – Patient and Family Engagement
   – Patient Safety
   – Care Coordination
   – Population and Public Health
   – Efficient Use of Healthcare Resources
   – Clinical Processes/Effectiveness
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             Moving to Stage Two of
               Meaningful Use
• Eligible Professionals can electronically report CQMs either
  individually or as a group:
   – Physician Quality Reporting System (PQRS) GPRO tool or
   – CMS Portal – electronic submission of aggregate-level data
• Eligible Hospitals and CAHs will electronically report their
  CQMs through the EHR Reporting Pilot infrastructure for
  hospitals
• Hardship Exceptions:
   –   Infrastructure: lack of internet or insurmountable barriers
   –   New EPs - limited 2 year exception to become users
   –   Unforeseen Circumstances: Natural disaster
   –   By scope of Practice: Lack of face to face or telemedicine; lack of
       follow-up need; multiple locations with lack of EHR technology
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                          Compliance Risks Of
                          EHR Implementation
              Inpatient, Outpatient, even Nursing
•   Using entries from another person or source (such as
    another provider, resident, or student) as their own
    documentation
•   Using documentation from a previous stay or visit to
    document a current stay or visit
•   Using templates that may not represent what happened
    during the current stay or visit
•   Misrepresenting the nature of the stay or visit by carrying
    forward past clinical data that does not apply to the
    current stay or visit

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        May 2012 Findings from OIG
                                   Emergency Room Levels
                   Code               2001          2005    2010
                  99281                2%            1%     0%
                  99282                9%            5%     3%
                  99283               31%           27%     20%
                  99284               32%           30%     29%
                  99285               27%           38%     48%

                                     Hospital Care Visits
                   Code               2001          2005    2010
                  99231               31%           22%     15%
                  99232               53%           58%     59%
                  99233               16%           20%     25%



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        May 2012 Findings from OIG


                                   Established Patient Visits
                  Code                 2001         2005        2010
                 99211                 6%            5%         4%
                 99212                 16%           12%        9%
                 99213                 54%           52%        46%
                 99214                 21%           28%        36%
                 99215                 3%            3%         5%




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                               EHR Situation
   • The OIG finds E/M Levels are rising and
     believes EHRs are the likely cause
   • Rising rates appear not to result from
     seeing sicker patients
   • CMS is identifying, auditing, and training
     providers whose E/M levels have risen
   • CMS is also interested in the Nurses’ Notes
     to support or not support the acuity of a
     patient
   • CMS is also monitoring DRG intensities for
     hospital audits
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        Beginning of Healthcare
                Reform
            March 23, 2010



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                           Already in Effect
 • Health plans can no longer limit or deny
   coverage for children under 19 because
   the child has a pre-existing condition
 • Health plans can no longer impose a
   lifetime limit or cap on benefits
 • Health plans can no longer retroactively
   cancel coverage without proving fraud


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                Already in Effect, cont.
• Health plans can no longer deny claims without
  giving individuals the right to appeal.
       – If they still deny the claim after an appeal has been filed,
         individuals have the right to appeal to an independent
         reviewer.
• Children under 26 can be covered under their
  parents EGHPs if they don’t already have
  coverage through their job.
       – This applies even if the child does not live at home or is
         married.

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                  Already in Effect, cont.
   • New health plans are required to offer access to
     preventive services, such as:
         – screening, vaccinations and counseling at no charge,
           including no copayment, coinsurance, or any deductible.
   • Depending on one’s age preventive services may
     include:
         – blood pressure, diabetes and cholesterol tests;
         – many cancer screenings; routine vaccinations; flu and
           pneumonia shots
         – regular well-baby and well-child visits from birth to age 21.



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                 Already in Effect, cont.
 • With new health plans, you can now choose the
   pediatrician or PCP you want or from your
   company’s provider network.
 • You can also see an OB-GYN without getting a
   referral from a PCP.
 • With new health plans, you won’t be required to get
   prior approval before getting ER services from a
   facility that is outside your plan’s network – and you
   won’t have higher copayments.


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          Already in Effect, cont.
• Establish temporary high risk pool to provide
  health coverage to individuals with pre-existing
  conditions (effective until 1/1/2014).
• Create a temporary reinsurance program for
  employers providing EGHPs to retirees over age
  55 who are not eligible for Medicare (effective
  until 1/1/2014).



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                  Already in Effect, cont.
 • Provides a $250 rebate to beneficiaries who reach Part D gap
   (doughnut hole) and gradually eliminate the Part D coverage
   gap by 2020.
 • Creates a state option to cover childless adults through a
   Medicaid State Plan Amendment.
 • Creates a state option to provide Medicaid coverage for family
   planning services to certain low-income individuals through a
   Medicaid State Plan Amendment up to the highest level of
   eligibility for pregnant women,
 • Creates a new option for states to pick up CHIP coverage to
   children of state employees eligible for health benefits if certain
   conditions are met.

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             Already in Effect, cont.
   • Tax credits are available for small businesses (through 2013)
         – Must have fewer than 25 employees with average annual wages <$50K
   • For-profit firms must contribute 50% towards their employees
     premiums.
   • The benefit works on a sliding scale. Companies with 10 or less
     employees with average wages <$25K get a 35% tax break.
         – The percentage decreases for firms with more employees, higher salaries
           or both.
   • For-profit firms get a general business credit.
   • For non-profit firms the credit will be in the form of a reduction
     in income and Medicare tax the employer is required to
     withhold from employees’ wages and the employer share of
     the Medicare tax on these wages.

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           Already in Effect, cont.
 • Impose additional requirements on non-profit
   hospitals.
        – Impose a tax of $50K for failure to meet these
          requirements.
 • Limit the deductibility of health insurance
   provider executives and employees
   compensation to $500K per applicable
   individual.
 • Impose a tax of 10% on the amount paid for
   indoor tanning services.
 • If 80 to 85% of premium not for benefits,
   rebate on premium dollar
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                More Medicare Reforms
 • Require drug manufacturers to provide a 50% discount on
   brand-name prescriptions and begin phasing in federal
   subsidies for generic prescriptions filled in the MCR Part D
   coverage gap.
 • Provide a 10% bonus payment to PCPs and to general
   surgeons practicing in health professional shortage areas
   (effective 2011-2015).
 • Restructure payments to Medicare Advantage plans by
   settling payments to different percentages of MCR fee-for-
   service rates.
 • Reduce annual market basket updates for Medicare
   providers


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    More Medicare Reforms, (cont.)
    • Provide Medicare payments to qualifying hospitals in
      counties with the lowest quartile Medicare spending for
      2011 and 2012.
    • Freeze income thresholds for income-related MCR Pt B
      premiums for 2011 through 2019 at 2010 levels and
      reduce the Part D premium subsidy for those with
      incomes above $85K/individual and $170K/couple.
    • Create an Innovation Center within CMS – charged with
      helping develop and implement programs that will help
      improve and update the nation’s healthcare delivery
      systems under provisions of PPACA – and “experiment
      with new strategies to accomplish the same”.
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              2012 Medicare Reforms
• Reduce Medicare payments that would otherwise be made to
  hospitals by specified percentages to account for excess
  (preventable) hospital readmissions
• Create a Medicare Independence at Home demonstration
  program (Community First Choice Option)
• Establish a hospital value-based purchasing program in
  Medicare and develop plans to implement value-based
  purchasing programs for SNFs, HHAs and ambulatory surgical
  centers.
• Provide bonus payments to high-quality Medicare Advantage
  plans (See Later Slide)
• Reduce rebates for Medicare Advantage Plans
• Establishing Accountable Care Organizations to reduce cost
  and share in savings
• Re-admission penalty for Pneumonia, Heart Failure, and AMI
  based on claims from 7/1/2008 to 6/30/2011 for FY2013
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            2013 Medicare Reform
 • Establishes a national pilot program in which
   doctors, hospitals and other providers are
   paid a flat rate by Medicare for each patient
   “episode of care” (Bundling)
 • Preventive care services for Medicaid
 • Primary care physicians receive 100% of
   Medicare payment rates for Medicaid Pts.
 • An extension of CHIP for two more years
 • States choice of Healthcare Insurance
   Exchange (or Federal)
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                  2014 Medicare Reform
 • Reduce out of pocket amount that qualifies an enrollee for
   catastrophic coverage in Medicare Pt D (through 2019).
 • Establish an Independent Payment Advisory Board to submit
   legislative proposals containing recommendations to reduce
   the per capita rate of growth in Medicare spending if
   spending exceeds a target growth rate.
 • Reduce DSH payments initially by 75% and increase
   payments based on the % of the population uninsured and
   the amount of uncompensated care provided.
 • Require Advantage plans to have medical loss ratios no lower
   than 85%.
 • Pre-existing conditions gone for EVERYONE
 • Eliminate annual limits on Insurance Coverage
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                  2014 Medicare Reform
 • Ensuring coverage for individuals participating in Clinical
   Trials.
 • Tax credits to afford insurance for people/families with
   income between 100% and 400% of the Federal Poverty Line
 • Establish affordable Insurance Exchanges (either State or
   Federal) for individuals/families or small businesses.
   Members of Congress will use exchanges.
 • Increasing Access to Medicaid for those less that 133% of the
   Federal Poverty Line. States will receive 100% federal
   funding for first three years and 90% after that.




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  2015 Medicare Reform and After
        • Reduce Medicare payments to certain
          hospitals for hospital acquired conditions
          by 1%




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                         Coming Soon
                       ICD-9 CM/Vol 3
                     to ICD-10 CM & PCS


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                            ICD-10 Final Rule

 • Published January 16, 2009 AND
   August 24, 2012:

                            October 1, 2014
 • Compliance date for FULL implementation
   of both the Clinical Modification (CM) and
   the Procedure Coding System (PCS)

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                                   Benefits
• Reimbursement
      – More accurate and fair reimbursement
      – Better justification of medical necessity
      – Fewer erroneous and rejected claims
      – Reduced opportunities for fraud and
        improved fraud detection capabilities
      – Increased sensitivity when making
        refinements in applications such as
        grouping and reimbursement
        methodologies

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Overlapping Timelines (CMS concern)
• Meaningful Use of EHRs (Phases)
• Health Reform Initiatives
     – Accountable Care Organizations (Jan 2012)
     – Value-based Purchasing
           • Base performance period (FY2010-FY2012); implemented FY2013
     – Readmission Payment Penalties
           • Base performance period (FY2010-FY2012); implemented FY 2013
     – Bundled payment (Jan 2013)
     – Hospital acquired conditions


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Consequences of Poor Preparation
• Increased claims                   • Improper claims
  rejections and denials               payments
• Increased denials in               • Coding backlogs
  processing                         • Compliance issues
  authorizations and                 • Decisions based on
  reimbursement claims                 inaccurate data
   Problems can be mitigated with proper advance preparation




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        What are the GEMs? (from CMS)
• GEMs are reference mappings to assist users
  in navigating the complexity of translating
  meaning from the contents of one code set to
  the other code set
• GEMs are NOT a straightforward “crosswalk”
• GEMs are NOT the solution for all data
  conversion projects


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          When should GEMS be used?
• To convert databases such as:
      –   Payment systems
      –   Payment and coverage edits and policies
      –   Risk adjustment logic
      –   Quality measures
      –   Disease management programs
      –   Utilization/case management systems
      –   Financial modeling
      –   Variety of research applications involving trend data
• To translate coded data for comparing data across transition
  period
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When should GEMs NOT be used?
• When you have access to the medical record?
• When you have access to text descriptions or
  clinical terms describing the diagnosis or
  procedure
• When a small number of codes are being
  converted
• GEMs should NOT be used for coding medical
  records!!!!
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             TIME FOR A BREAK!!!!




                             THEN….the new
                             CMS regulation!!!
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         Additional Information to the
           Final Rule pertaining to
              National Identifiers



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    National Provider Identifier
          Requirements
• This final rule adopts the standard for a national
  unique health plan identifier (HPID)
• Establishes requirements for the implementation
  of HPID
• In addition, adopts a data element that will serve
  as an ‘other entity identifier’ (OEID) or an
  identifier for entities that are not health plans,
  providers, or individuals but that need to be
  identified in standard transactions
• Compliance dates: November 5, 2014
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     National Provider Identifier
           Requirements
• Definitions:
  – Controlling Health Plan (CHP): one that controls its
    own business activities, actions or policies; or is
    controlled by an entity that is not a health plan
    and if it has subhealth plan(s), exercises sufficient
    control over the subhealth plan(s) to direct
    its/their business activities, actions, or policies.
  – Subhealth Plan (SHP): a health plan whose
    business activities , actions or policies are directed
    by a controlling health plan.
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     National Provider Identifier
           Requirements
• The OEID will function as an identifier for
  entities that are not health plans, health care
  providers, or individuals but that need to be
  identified in standard transactions.
  – Examples:
     • third party administrators
     • Transaction vendors
     • Clearinghouses



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     National Provider Identifier
           Requirements
• This rule requires an organization covered
  health care provider to require certain non-
  covered individual health care providers who
  are prescribers to:
  – Obtain NPIs and
  – To the extent the prescribers write prescriptions
    while acting within the scope of the prescribers’
    relationship with the organization, disclose them
    to any entity that needs the NPIs to identify the
    prescribers in standard transactions.
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     National Provider Identifier
           Requirements
• “The providers we intend to reach are
  prescribers who are not required to obtain
  and disclose an individual NPI under the
  current NPI regulations:
  – Hospital-based providers who staff clinics and ED’s
  – Medical residents and interns, as well as
  – Prescribers in group practices whose services are
    billed under a group (Type 2 NPI) regardless of
    whether they have Type 1.
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     National Provider Identifier
           Requirements
• Effective date of Final Rule: Nov 5, 2012
• Effective date of NPI requirement: May 6, 2013
• Effective date of HPID: Nov 5, 2014
  – Small health plans are Nov 5, 2015
• Effective date of HIPAA requirement:
  Nov 7, 2016



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    National Provider Identifier
          Requirements
• Both HPID and OEID will be a 10-digit, all
  numeric identifier with a Luhn check-digit as
  the 10th digit
• Either an NPI, an HPID or an OIED – no
  multiples
• Self-insured plan is an HPID even with a TPA
• Workers Comp and No-Fault are OIEDs


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        Understanding the Difference
         between ICD-9 and ICD-10
              with Examples



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     Benefits of Adoption of ICD-10

  Improved ability to measure health care
   services
  Increased sensitivity when refining
   grouping and reimbursement
   methodologies
  Enhanced ability to conduct public health
   surveillance
  Decreased need to include supporting
   documentation with claims

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       Examples of Quality Problems With
          Current ICD-9-CM System
    Example - Fracture of wrist:
    - Patient fractures left wrist
      A month later, fractures right wrist
    - ICD-9-CM does not identify left versus
      right

    ICD-10-CM describes:
    - Left versus right
    - Initial encounter, subsequent encounter
    - Routine healing, delayed healing or
      nonunion
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               Diagnoses Will Look Different
        ICD-9- CM currently has 3-5 digits
        Example ICD-9-CM: 810.00
        (fracture of clavicle, closed,
         unspecified part)

        ICD-10-CM has 3 – 7 characters
        Example ICD-10-CM: S42.001A
        (fracture of unspecified part of right
         clavicle, initial encounter for closed
         fracture)
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                                   Sports Medicine
      Hit by a ball - ICD-9-CM code: E917.0
                 ICD-10-CM possible code
      •    W21.00 – Struck by hit or thrown ball, unspecified type
      •    W21.01 – Struck by football
      •    W21.02 – Struck by soccer ball
      •    W21.03 – Struck by baseball
      •    W21.04 – Struck by golf ball
      •    W21.05 – Struck by basketball
      •    W21.06 – Struck by volleyball
      •    W21.07 – Struck by softball
      •    W21.09 – Struck by other hit or thrown ball

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                                   ER Department
    Motor vehicle accident (car occupant injured in
      collision with heavy transport vehicle or bus)
    ICD-9-CM code; E819.1
                 ICD–10–CM specific code
    •    V44.0 – Car driver injured in collision with heavy transport vehicle or bus in
         non traffic accident
    •    V44.1 – Car passenger injured in collision with heavy transport vehicle or
         bus in non traffic accident
    •    V44.2 – Person on outside of car injured in collision with heavy transport
         vehicle or bus in non traffic accident
    •    V44.3 – Unspecified car occupant injured in collision with heavy transport
         vehicle or bus in non traffic accident
    •    V44.4 – Person boarding or alighting a car injured in collision with heavy
         transport vehicle or bus
    •    V44.5 – Car driver injured in collision with heavy transport vehicle or bus in
         traffic accident
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                                   ER Department
    Motor vehicle accident (car occupant injured in
      collision with heavy transport vehicle or bus)
    ICD-9-CM code; E819.1
              ICD–10–CM specific code cont’d
    • V44.6 – Car passenger injured in collision with heavy transport vehicle
      or bus in traffic accident
    • V44.7 – Person on outside of car injured in collision with heavy
      transport vehicle or bus in traffic accident
    • V44.9 – Unspecified car occupant injured in collision with heavy
      transport vehicle or bus in traffic accident

                                      To be continued…
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                                   ER Department
      Motor vehicle accident (car occupant injured in
        collision with heavy transport vehicle or bus)
      ICD-9-CM code; E819.1
                ICD–10–CM specific code cont’d
      A driver of a car collided with a bus on a business street during rush hour
      traffic. The driver stated to being on his cell phone at the time of the accident

      Codes to report this transport accident include:
      • V44.5xxA6 – Car driver injured in collision with heavy transport vehicle or
         bus in traffic accident
      • Y92.414 – Local resident or business street as the place of occurrence of
         the external cause
      • Y93.C2 – Use of cellular telephone and other electronic equipment at the
         time of the transport accident

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                  ICD-10-PCS Code Structure

  ICD-10 PCS Code Structure:


                                   Root
   Section                                            Approach       Qualifier
                                   Operation


      1               2            3           4      5      6       7
                      Body                     Body
                                               Part         Device
                      System




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                             ICD-10-PCS Example
    Interphalangeal fusion of right great toe,
      percutaneous pin fixation
    OSGP34Z
     Section                       Med/Surgical        0
     Body System                   Lower Joints        S
     Root Operation                Fusion              G
     Body part                     Toe Phalangeal      P
                                   Joint - Right
     Approach                      Percutaneous        3
     Device                        Internal Fixation   4
                                   Device
     Qualifier                     None                Z


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Systems Affected
               What Systems will Providers
                    need to review?
          Hospital
                                   Scheduling &
        Information                                  Order Entry
                                   Registration
           System
                Lab                   Nursing         Physicians

          Radiology                  Pharmacy          Surgery

               HIM                     EMR            Interfaces

       Transcription               “Connections”   Patient Accounts

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                              Applications Affected
                                 by Transition
 • Encoding software                    •   Registration and Scheduling
 • Medical record abstracting           •   Utilization management
   systems                              •   Quality management
 • Billing systems                      •   Case mix systems
 • Practice management                  •   Case management
   systems                              •   Disease management
 • Groupers                             •   Financial
 • Electronic health record             •   Medical necessity software
   systems                              •   Registries
 • Clinical systems                     •   Compliance software
 • Decision support systems             •   Patient assessment data sets
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Processes Affected
       Business Processes Affected by ICD-10




                                   ICD-10




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               Departments Not Impacted by ICD-10…


       •    Dietary
       •    Fundraising
       •    Housekeeping
       •    Laundry
       •    Maintenance


       ICD-10 IS NOT “JUST” A CODING PROBLEM…

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                     ICD-10 Assessment Process

              Contract                    User                 Gauge
              Reviews                  Assessment            Vendor/TPP
                                                              Readiness




     Initial                 ICD-10       Payer          Post        Present
   Documents                Project    Assessment    Assessment      Findings
    Request                 Kick-Off                  Follow Up     To Mgmt.



            Committee                       IT                 Analyze
             And Plan                  Assessments           Data & Write
              Review                                            Report



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                           ICD Code Difference
    CM - Clinical Modification                PCS- Procedure Coding System
      80000                                 100000

                                            90000
      70000

                                            80000
      60000
                                            70000
      50000
                                            60000
      40000
                                            50000

      30000
                                            40000

      20000                                 30000

      10000                                 20000

                                            10000
          0
                   ICD 9
                     1             ICD 10
                                      2
      Series1      13000           68000         0
                                                         1
                                                       ICD-9        2
                                                                  ICD 10
                                             Series1   11000     87000




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                                   Billing Impacts
      • Upgrades for multiple IT systems
      • Changes associated with the Electronic
        Medical Record
      • Mapping dual coding systems
      • Billing Systems data requirements
      • Replacement of older systems
      • Revising system interfaces
      • Developing new reports
      • Retraining users
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                                   Billing Impacts
     System changes will impact:
     •    Physicians – PM software and EHR
     •    Nurses – Orders/Dx and EHR
     •    Ancillaries – Orders and Interfaces
     •    Billing – Clearing House and Contracts
     •    Coding – Documentation and Training
     •    Care management – Training and Monitoring
     •    Reporting – new design for “Dashboard”
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                         Cash Flow Impacts
   ICD-10 changes can cause unintended
   consequences in:
                  Claims backlogs (DNFB and Clearinghouse
                   edits)
                  Payment delays (Third Party Behavior)
                  Denials (due to coding) – High focus
                  Reimbursement – How do you assure???


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      Billing and Cash Flow Impacts
 Can include:
 •    Multiple system upgrades and testing cycles
 •    Significant training
 •    Increased claims denials
 •    Delayed payments
 •    Lost or reduced reimbursement


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       Billing and Cash Flow Impacts
  GEMS: CMS has developed GEMS (General Equivalency
   Mapping System) between ICD-9 and ICD-10, however,
   no one-to-one direct match

  Each health plan has to directly match ICD-9 to ICD-10
   codes and match the rate for reimbursement

  Health plans also need to map against medical policy,
   claims edits, and reimbursement methods to
   understand their impacts to business processes and
   system

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                          Don’t Forget
                      Education and Training
     From the Board Level and Executive
      Management to the clerical staff entering
      charges and clinical codes
     Required Staff:
          •   Manager of Revenue Generating Departments
          •   Nurses
          •   ER staff and Ancillary staff
          •   Business Office staff
          •   HIM abstractors and coders
          •   Physicians
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  ACOs and
New Medicare
Payment Plans


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    Accountable Care Organizations
• The structure of an ACO is characterized by the
  integration between physician partners and the
  reimbursement model coordinated with the
  Medicare Shared Savings Program (MSSP)
• Primary care physicians to sustain at least 5,000
  beneficiaries.
• Now 33 measures in 4 domains (experience,
  process, outcomes and utilization) with phase-in
  – 1st yr full pay; 2nd and 3rd for performance
• Assignment of beneficiaries based on PCP svcs
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      Accountable Care Organizations
• An ACO must define processes to promote evidence-
  based medicine, patient engagement, coordination of
  care, and quality and cost measures with a
  demonstration that it focuses on patient-centered care.
• Shared savings bonuses are distributed directly to the
  ACOs for saving generated from reducing healthcare
  costs.
• ACOs must provide a list of primary care practitioners
  who directly render PCP services for the “assignment”
  of beneficiaries

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                                   ACO Updates
• The National Committee for Quality Assurance (NCQA)
  will start accountable care organization (ACO)
  accreditation this month. Will assess:
     –   Structures and operations
     –   Access to needed providers
     –   Patient-centered primary care
     –   Care management
     –   Care coordination and transitions
     –   Patient rights and responsibilities, and
     –   Performance and quality improvement
• Third party insurers are planning way ahead of the
  government
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                                   ACO Updates
• In April 2012, CMS picked 27 ACO participants
     – Iowa Health System
     – Banner Health Network and Aetna
     – Carilion Clinic and Aetna
     – Cleveland Clinic and Aetna
     – Dartmouth and WellPoint
     – Inova and Anthem
     – Scripps Health and United
• May 2012 – 221 ACOs in 45 states reported
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                                     ACO Updates
• United is acquiring XLHealth Corp., a privately held
  sponsor of Medicare Advantage health plans
   – Currently 113,000 members in AK, GA, MD,MO, SC, TX
   – In 2012, expansion to IL, IN, IA, NM, NY, WI
• Cigna saves 9 percent on patients treated by doctors in
  Phoenix medical group it controls
• Effective July 1, Aetna awarded administrative services
  contract for Maine’s 33,000 employees and dependents
  It plans a statewide ACO network for this membership


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                                   ACO Updates
 • Humana working hard on Medicare Advantage
   nationwide for partnering as an ACO.
 • Health Care Services Corp (HCSC), Wellpoint Inc.
   and BCBS of Michigan have a joint venture to offer
   nationwide private insurance exchange and defined
   contribution solutions for employers via an
   investment in Bloom Health
 • An alternative to the state insurance exchanges set
   to be operational in 2014 as part of the health
   reform law


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                                   ACO Updates
 • “Some observers watching these
   developments say the health law which
   was passed as a way to rein in insurers, has
   had the opposite result, opening the door
   for some companies to take control of even
   more part of the health system.”




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                     ACO Future Concerns
• ANTI-TRUST: joint negotiation of contracts
  between physicians as well as between
  hospitals; and addressing physicians who
  may work at different hospitals that are NOT
  part of the ACO?
• STARK/ANTI-KICKBACK: will this law have any
  effect on the ACOs approach to reward
  physicians if quality is maintained and cost
  savings achieved?

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                      ACO Future Concerns
• TAX-EXEMPT PROVIDERS: in the ACO environment,
  if clinically integrated, is the sharing of the cost
  savings a violation of any current tax laws?

• STATE INSURANCE REGULATION: if ACOs become
  their own insurer for services rendered and assume
  financial risk under the reimbursement structure,
  will they have the financial capability to assume the
  risk if they experience a high volume of very
  expensive care patients?

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                      ACO Future Concerns
• MEDICAL MALPRACTICE: ACO structure/practices/
  procedures may prevent costs from decreasing due
  to ‘defensive medicine’.

• HEALTH BENEFIT (INSURANCE) EXCHANGES: how
  will these state exchanges “fit” into the ACO
  structure if they are a third party owned ACO.




  C: Best Practice Associates, LLC                   87
       State Insurance Exchanges
• Unless the law is repealed by Congress, most of the
  major changes take effect on Jan. 1, 2014. By then,
  states must have set up health insurance exchanges,
  where people can buy coverage. Insurers will have to
  offer policies to anyone who applies, including
  people with expensive medical conditions. And
  people who do not qualify for exemptions based on
  income or religion will be required to have minimum
  insurance coverage or pay a penalty


                   C: Best Practice Associates, LLC   88
       State Insurance Exchanges
• There is a funding opportunity to establish these
  exchanges
• The state may establish
   – A state-based exchange
   – A state partnership exchange or,
   – Prepare state systems for a federally facilitated exchange
• 49 States and DC have received some funding
• HHS will conduct regional implementation forums in
  the coming months

                       C: Best Practice Associates, LLC       89
        New Medicare Payment Plan
 • Medicare will soon track spending on millions
   of individual beneficiaries and reward
   hospitals that hold down costs and penalize
   those whose patients prove most expensive.

 • “Medicare spending per beneficiary” is a new
   measure consisting of costs generated during a
   hospital stay, the 3 days before it and the 90
   days afterward.
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                                                   90
        New Medicare Payment Plan
 Example:
 • If Medicare spends an average of $9,125 per
   beneficiary at a hospital AND if the comparable
   figure for all hospitals nationwide is $12,467,
   the hospital gets high marks – 9 out of 10
 • This measure combined with measures of
   quality would compute an overall performance
   score that would pay a higher (or lower)
   percentage of each claim filed by the hospital
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          Insurer-Run Care in
        Retail Clinics and even a
          Single Payor System


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                                    92
  Insurer-run Care in Retail Clinics
   Coming back for a re-play
   • Recent trends show a growth to nearly 1,200
     retail clinics at former Urgent Care Centers,
     strip malls and even grocery store chains.
   • This is driven by:
         – Demographic targeting of plan members
         – Greater cost control for the health plan
         – Greater opportunity to market themselves to
           potential customers

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   Insurer-run Care in Retail Clinics
    • Benefits:
          –   Flexible scheduling
          –   Extended hours
          –   Urgent care services
          –   Other services not available at conventional
              physician offices
    • PLUS
          – Higher level of control over expenses
          – Reducing admin and other overhead costs
          – Preparation for 2014
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                                                             94
                           Vermont Adopts
                         Single-Payor System
      • May 26, 2011 signed H.202 into law
      • First state-financed single-payor system
      • Various elements:
            –    State run health benefit exchange
            –    Medical malpractice reform
            –    Modifying insurance rate review process
            –    Creating a statewide drug formulary
      • 5 member board established October 2011
        for “Green Mountain Care”
      • Financing plan due January 15, 2013
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                                                           95
                    Green Mountain Care
• Establish a “Health Insurance Exchange” to
  certify, recertify and decertify qualified health
  plans “consistent with guidelines developed
  by the DHHS Secretary”
• When fully implemented, expectations are:
     – Lower health care spending by 25.3% (10 yrs)
     – Savings of $580m first year plus $56m in moving
       to a uniform payment rate

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                    Green Mountain Care
• Achieving universal coverage is expected to
  cost Vermont $252m in 2015
• New system expected to create 3,800 jobs
• Employer spending decrease by $100m by
  2016, or $260 per employee
• Net benefit to households estimated $370 per
• Tax rate required to finance will be 14.2% with
  employers at 10.6% and employees 3.6%
• August: review of 14 hospital budgets
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                WHAT CAN BE NEXT???




C: Best Practice Associates, LLC      98
       Re-Admission Penalties

• CMS expects to recoup about $280 million in
  payments from more than 2,200 hospitals

• This will start in October 2012!!!!!




                 C: Best Practice Associates, LLC   99
YOU CAN’T STOP THE WAVES, BUT YOU CAN LEARN TO SURF
                                                 100
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         Questions and Contacts


Best Practice Training Institute
        Lorrie Borchert
         540.226.2034
   www.bptisolutions.com
                                               Best Practice Associates
  lorrie@bptisolutions.com
                                                    Rob Borchert
                                                    315.345.5208
                                              www.bpa-consulting.com
                                              rob@bpa-consulting.com

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