Katie Carolan
David Reitzel

How to assess your organization's ICD-10 readiness, train staff, and predict the costs of converting to this new system.

At a Glance   

  • Training for ICD-10 is going to be expensive, though predictions of how expensive vary widely.
  • Healthcare finance executives should create a flexible, multiyear capital and operating budget to prepare for ICD-10 conversion and the training and support that will be required.  
  • Healthcare organizations also should assess staff knowledge in the critical ICD-10 areas and begin training now to be ready for go-live by early 2013.  

As organizations eye the looming transition to ICD-10, the question arises regarding who needs to be trained on this new coding system. The simple answer: Everyone who cares for a patient, touches a medical record, or processes a bill.

For healthcare finance executives, early understanding of who in their organization needs training-and when-is critical for both budgeting and staffing. A good plan that starts now and continues beyond the Oct. 1, 2013, go-live date means a smoother transition that both lessens staff productivity losses and minimizes revenue slow-downs.

This plan should include:

  • A general awareness campaign about the changes that ICD-10 will require for the entire organization
  • An assessment of staff knowledge in the critical ICD-10 areas
  • Implementation of individual, role-based training
  • Creation of post go-live support, reassessments, and continuing education

First Step: Awareness for All

Provider organizations should have begun the awareness process regarding ICD-10 in 2010, if lessons learned from Canada's implementation of ICD-10 are an indication. That country's implementation showed it takes a lot longer than expected and results in a substantial drop in productivity by coders-a 50 percent drop to start, with a continuing 10 to 25 percent drop moving forward (Replacing ICD-9-CM with ICD-10-CM and ICD-10-PCS: Challenges, Costs, and Estimated Benefits, a report prepared for Blue Cross and Blue Shield by the Robert E. Nolan Company, October 2003, and Johnson, Kerry, Implementation of ICD-10: Experiences and Lessons Learned from a Canadian Hospital, American Health Information Management Association, 2004).

The American Health Information Management Association (AHIMA) states that ensuring organizational awareness, establishing a training plan, and preparing a multiyear budget are all key steps for Phase I of ICD-10 implementation (first quarter 2009 through second quarter 2011).

Because nearly every hospital department needs to be aware of the magnitude of effort required in the transition to ICD-10 and must budget accordingly, awareness training should begin immediately. A hospital's marketing team, working in conjunction with the organization's health information management (HIM) department, should coordinate the strategic content of this message to staff. In addition to using traditional communications techniques such as posters, newsletters, lunch meetings, or departmental meetings, hospitals also should consider harnessing the power of social media to get the message out.

Assess Readiness and Training Needs

With general awareness education under way, healthcare finance officers should turn their attention to budgeting for ICD-10 training. In creating a budget, a baseline assessment of staff knowledge in critical areas, such as those jobs listed in the sidebar at right, should be performed to see where gaps in knowledge and skills exist.

Coding staff should be assessed on their knowledge in four areas:

  • Medical terminology
  • Anatomy and physiology
  • Pathophysiology
  • Pharmacology

Because ICD-10 requires a more in-depth knowledge of these four areas, all coders- representing inpatient, outpatient, radiology, and emergency services-should be included in the initial assessment.

After an assessment is performed, an education program catered to each individual's needs should be developed and put into the budget. Initial baseline training should begin this year, with more intense ICD-10 training taking place in early 2013. AHIMA recommends 50 hours of coder training for both ICD-10 clinical modification (CM) and procedure coding system (PCS) for 2013 (Majerowicz, Anita, "Developing an ICD-10-CM/PCS Coder Training Strategy," Journal of AHIMA, April 2011).

Coder education programs can include a combination of online and on-site training, with group classes and self-study programs offered. Research shows that using multiple teaching avenues increases overall success, because different people absorb information in different ways. Adult learners also prefer having a choice of which classes they take-and when.

Specific training for various departments should be tailored and delivered in "small bites" over regularly scheduled timeframes. This approach spreads the cost of training over several years while maximizing the absorption and retention of information by staff.

In general, for coding areas, online assessments and online courses are very useful. Clinicians need a more hands-on approach: the more specific and tailored, the better. When it comes to physicians, training by specialty and by medical practice works best. A broad-brush approach should be avoided.

Providers should be vigorous in training coders and physicians. Lack of specificity in documentation will steer many DRGs to "unspecified" waste buckets that typically reduce reimbursement and fundamentally erode the economic and quality benefits of converting to the ICD-10 code set. Further, unspecified coding raises red flags for potential audits and revenue take backs.

Predicting the Cost

When it comes to cost, the only "known" is that the conversion to ICD-10 is going to be expensive. Industrywide estimates show huge variances.

According to the RAND Science and Technology Policy Institute's 2004 estimate, it will cost between $425 million and $1.15 billion in one-time costs to implement ICD-10-plus between $5 million and $40 million a year in lost productivity. Blue Cross and Blue Shield's study for the ICD-10 transition showed one-time costs at $5.5 to $13.5 billion, with recurring costs estimated at $150 to $380 million annually.

During its 2011 ICD-10 coding summit in Baltimore, AHIMA experts projected that an inpatient coder will need 50 hours of training in 2013 at a cost of $3,218.75, while an outpatient coder will need 16 hours of training at a cost of $644 per coder in 2013. Additional costs will be incurred in 2011 and 2012 for education. The 2008 Nachimson Advisors LLC report The Impact of Implementing ICD-10 on Physician Practices and Clinical Laboratories, released in October 2008, predicts physician practices costs for the ICD-10 transition at about $83,290 for a small practice (three physicians), $285,195 for a medium practice of 10 physicians, and $2.7 million for a large practice (100 physicians).

IT also needs to be brought on board to make sure vendors and systems are ready for the transition. Software, hardware and service upgrades will probably be required, with additional training on the new applications needed, adding to the costs. Small systems in many institutions currently not on IT's radar also need to be included in this phase.

Healthcare finance executives should use these benchmarks to build estimates for financial impact, planned for in a flexible, multiyear capital and operating budget.

Finance and revenue cycle staff also need to be involved in this phase. It is important not to forget to include training cost for revenue cycle staff if the organization is upgrading systems. Also, the revenue cycle is highly ICD dependent; Therefore, workflow processes, forms, and reports all should be evaluated for ICD-10 readiness. In addition, preparations and planning for longer billing cycles and higher numbers of denials should be made.

October 2013 and Beyond

The go-live phase of 2013 requires organizational agility, especially in revenue cycle, HIM, and IT. Finance officers should budget for significant drops in coder productivity, which will have an impact on revenue and will require additional labor resources (whether from internal staff, outside agencies, or contract workers). Top vendors and experienced personnel are being booked early, so many providers are contracting now for supplemental coding and billing support in 2013.

Organizations also should plan on investing in additional training or retraining in 2013, particularly as revenue cycle issues arise.

Trainers Stay Vigilant After Go-Live

The transition to ICD-10 is an enormous undertaking-one that will require careful management not just before and during implementation, but also afterward, until staff productivity stabilizes and issues related to implementation are resolved. That is why training partnerships and collaborations will be essential. Providers should utilize online and college-based educational services and information available through AHIMA. Senior managers and physicians should be included in the search for solutions to issues that result from the transition to ICD-10. Some organizations also may choose to leverage an outside ICD-10 specialty partner for project management.

It's important that healthcare finance professionals not become complacent following the go-live phase. Follow through should continue for as long as it takes to establish a stable process and get cash flow back on track. There will be significant post-implementation problems, such as claims denials and rejections or coding backlogs. A process should be created for quickly identifying these problems, and feedback loops should be completed to fix them as soon as possible. General awareness and communications programs should be used to keep everyone in the loop throughout the transition.

Katie Carolan is vice president of operations at Health Record Services, Baltimore (katie@hrscoding.com).

David Reitzel, CMC, CPHIE, is the national health care business advisory services health IT leader, Grant Thornton, LLP, Chicago (david.reitzel@us.gt.com).

Sidebar 1

Who Should Be Trained on ICD-10?
The following types of professionals should be included in the first phase of an organization's education and training program:

  • Senior executives
  • Medical staff
  • Financial management professionals (accounting, billing)
  • IT staff
  • Clinical department managers
  • Health information management and coding staff
  • Quality management professionals
  • Utilization management/case management staff
  • Any performance improvement group professionals
  • Tumor registry staff
  • Research staff
  • Audit/compliance staff
  • Business associates

What level of education will be required for various staff? In general, patient access and revenue cycle staff will require a baseline knowledge, and IT staff, physicians, and clinical coders will require an indepth understanding.

Sidebar 2

Quick Returns, Immediate Rewards  

After coding assessments of staff are completed, there are three areas where healthcare finance executives help their organizations achieve a quick ROI in ICD-10 preparedness.

Clinical documentation improvement. Many organizations have clinical documentation improvement programs in place today to accommodate electronic health records (EHR) implementation and meaningful use criteria. Because ICD-10 dictates that documentation become more specific, any education efforts undertaken now will inevitably yield positive returns in ICD-9 coding outcomes, bearing fruit early.

Begin by applying the Pareto principle: Assess clinical documentation for the 20 percent of diagnoses and procedures that represent 80 percent of the organization's revenue. Be creative, and look at your data differently-instead of merely reviewing your top DRGs, look at fewer cases by DRG and shift to the top three admitting surgeons. Highest paying procedures such as interventional radiology also are good targets.

Fix ICD-9 codes presenting problems now, because those problems are likely to expand with ICD-10. Sampling techniques are useful for this phase. Results of this assessment will quickly identify which medical specialties need training and which do not.

Revenue cycle staff education. Translate the knowledge gained from documentation reviews into actionable teaching modules that a physician champion can present to the rest of the medical staff. Short, specialty-focused physician education sessions presented by physician champions are best practice. Organizations also should consider changes in the documentation capture process, particularly in EHR environments where additional prompts and drop down boxes can be implemented to aid physicians in creating ICD-10 ready, clinical documentation.

Payer and physician contract negotiations. Finance officers have the opportunity to gain some ICD-10 traction in contract negotiations via two avenues: in negotiating with payers and in negotiating with physician practices.

Many contracts with payers are based on code definitions. As these are entered into, or renewed, it makes sense to model the reimbursement impact of ICD-10 versus ICD-9. Working and planning together, coupled with a cooperative testing plan, will help both parties. Physician practice revenue projections should also be modeled, as they will change with ICD-10. Any negotiation for purchase should include ICD-10 upgrade language.

Sidebar 3

3 Steps to Preparing Physicians for ICD-10  

The one-to-one approach for physicians works best, says William Walker, MD, chief medical officer at St. Edward Mercy Health System in Ft. Smith, Ark.

He cites three steps for training physicians for ICD-10:

  • Short, focused, regular training sessions
  • Technology tools to drive accurate documentation
  • Aligned incentives to support clinical documentation improvement

"Since physicians don't learn coding or documentation in medical school, provider organizations must provide this education," Walker says. One-to-one conversations with coding trainers or case managers on ICD-10 language and medical necessity are a first step. Second, technology prompts and reminders can be used to lead physicians to the correct documentation. ICD-10-ready drop down boxes and documentation prompts work well and can be implemented now within EHR or speech recognition environments.

Walker suggests that providers align physician incentives to include chart completion and documentation accuracy. "Attendance at the training sessions could also be included," he says. Physicians respond to financial incentives, he says, and they help move everyone in the same direction.

Sidebar 4

ICD-10 Training: Expenses to Consider  

Five areas of cost related to ICD-10 training should be evaluated as an organization begins to plan for organizationwide training programs that will address multiple levels and layers of stakeholders:

1. Equipment:  

  • Computers and printers
  • Networking
  • Security

2. Software:  

  • Software licensing, installation, and support
  • Computer-based Training Material (i.e. customized to your organizations)

3. Personnel  

  • Project management or coordination
  • Data analysis support
  • Technical assistance and training

4. Services  

  • Training by third parties
  • Hosting services
  • Programming by third parties
    -System interface development
  • Data conversions
  • Security assessment and setup
  • Online connectivity
  • Facilitation
  • Disaster and recovery

5. Space and operations  

  • Equipment rental
  • Facilities rental


Publication Date: Monday, October 03, 2011

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