Mar. 27—Hospitals and other providers would have another year to prepare for the switch to ICD-10 under a bill passed by the U.S. House of Representatives on March 27.

A bipartisan deal to provide a one-year patch that avoids a deep cut in Medicare physician pay rates April 1 also includes a delay in the implementation date for ICD-10. The bill would push back the switch to the new diagnostic code sets by one year—to Oct. 1, 2015.

The measure is moving quickly through Congress because its details were agreed to by House Speaker John Boehner, a Republican, and Senate Majority Leader Harry Reid, a Democrat.

Senate passage of the bill may be complicated by a split among Senate Democrats, according to media reports. 

The proposed ICD-10 delay appeared to have caught both the Obama administration and healthcare industry by surprise, according to observers.  Many physicians groups and the American Health Information Management Association urged members to ask their congressional representatives to oppose the bill.

The physician opposition came despite the preference of many for an ICD-10 delay because physicians are more strongly opposed to Congress enacting yet another patch to prevent a cut to physician pay rates called for by Medicare’s sustainable growth rate formula (SGR) rather than a permanent replacement of the Medicare physician payment system.  The SGR requires a 24 percent cut to begin April 1.

A delay in ICD-10 implementation could carry both costs and benefits.

“For providers that are not prepared for the Oct. 1, 2014, implementation, the delay to at least Oct. 1, 2015, provides a greater opportunity to do the work necessary for a successful implementation of a very complex change,” said Sandra Wolfskill, director of healthcare finance policy, revenue cycle MAP for HFMA. “For providers that have already invested considerable resources in preparing for Oct. 1, 2014, implementation, the cost in rework and retraining will be considerable.”

Provisions Included

In addition to the SGR patch, other provisions of the bill included a six-month extension—to April 1, 2015—of the so-called probe-and-educate limited enforcement of the new two-midnight admissions rule.

The bill also would push back by one year—to 2017—the start of cuts in Medicaid disproportionate share hospital payments. The cuts also would continue one year longer—to 2024.

The changes were described as a potential “modest positive for the group” in a Wednesday report by Bank of America Merrill Lynch.

Additionally, the bill would extend to April 1, 2015 a range of so-called Medicare extenders:

 

  • The Medicare dependent hospital program 
  • Increased inpatient hospital payment adjustment for certain low-volume hospitals
  • Ambulance add-on payments
  • The work geographic price cost index floor
  • The therapy cap exceptions process 

Rich Daly is a senior writer/editor in HFMA’s Washington, D.C., office. Follow Rich on Twitter @rdalyhealthcare.

 

 

Publication Date: Thursday, March 27, 2014