Practice Economics

ICD-10 Medical Coding System Likely to Improve Documentation, Reimbursement


ICD-10 is the system that will replace ICD-9 for all parties covered by the Health Insurance Portability and Accountability Act (HIPAA). ICD-10 contains a code set used for inpatient procedural reporting and a code set used for diagnosis reporting. Physicians billing for professional services will only be affected when reporting diagnoses codes on their claims, but both physician and hospital selection of ICD-10 codes relies heavily on physician documentation. Therefore, documentation must be scrutinized. The most widely noted impact ICD-10 will have on documentation is increased specificity, with enhanced reporting of the patient’s presenting problem(s). Expanding from a pool of 14,000 3/5-digit codes to 69,000 7-digit codes, and accommodating this change, are daunting tasks. These anticipated burdens make it hard for physicians to recognize the positive effects ICD-10 may create, such as:1

  • Better clinical decisions as better data is documented, collected, and evaluated;
  • Improved protocol and clinical pathway design for various health conditions;
  • Improved public health reporting and tracking of illnesses and severity over time;
  • Better definition of patient conditions, providing improved matching of professional resources and care teams and increasing communications between providers;
  • Support in practice transition to risk-sharing models with more precise data for patients and populations;
  • Provision of clear objective data for credentialing and privileges, and support for professional Maintenance of Certification reporting across specialties;
  • Better documentation of patient complexity and level of care, supporting reimbursement and measures for quality and efficiency reporting; and
  • Reduction in audit risk exposure by encouraging the use of diagnosis codes with a greater degree of specificity as supported by the clinical documentation.

With the Oct. 1 implementation date rapidly approaching, physicians need to ask themselves, “Am I prepared?”

Getting Started

Everyone has a role and responsibility in transitioning to ICD-10. Active participation by all involved parties guarantees a more successful outcome. Practice administration must ensure that each aspect of implementation is reviewed and appropriately addressed. If not already done, immediate steps should be taken to verify the products and services that affect implementation. These include:

  • Payer mix and related contracts: Entities not covered by HIPAA (e.g. workers’ compensation and auto insurance companies) may choose not to implement ICD-10. Since ICD-9 will no longer be maintained post-ICD-10 implementation, it is in the best interest of non-covered entities to use the new coding system.2 For payers who are required to transition to ICD-10, it is important to identify whether patient eligibility, claim processing, and/or payment timelines will be affected, as well as fee schedules or capitated rates.
  • Vendor readiness: Physician groups may use a variety of vendors to assist with different aspects of the revenue cycle, including an electronic health record (e.g. documenting services and transmitting physician orders/prescriptions); a practice management system (e.g. scheduling and registering patients); a billing service (e.g. processing patient claims and payments); and a clearinghouse (e.g. verifying patient eligibility and obtaining authorizations). Know when software and/or hardware upgrades are available and if there are additional upgrade fees. Identify vendors that provide support services, training, and tools or templates to ease the transition. Most importantly, inquire about a testing period for products and applications to ensure functionality and adequate feedback on use of the system(s).
  • Internal coding and billing resources. Identify physicians and staff who use ICD-9 codes and need to know ICD-10 codes in order to fulfill their responsibilities. Both physicians and staff can assist in identifying common clinical scenarios and the most frequently used ICD-9 codes, in order to develop a list of common ICD-10 specialty codes. Payer coverage policies currently include ICD-10 codes for provider review and comparison. Revise current forms/templates that include diagnosis codes to reflect this updated information. Schedule ICD-10 training for clinicians, office managers, billers, coders, and other key staff. Coding professionals recommend that training take place approximately six months prior to the ICD-10 compliance deadline.3 Training sessions are available from consultants, professional societies, payers, and other entities. Cost varies depending upon the type and length of training. CMS provides some free services, but in-depth training or certification for at least one practice member should be considered.

Once training is completed, dual coding is an option. Dual coding is the process by which both ICD-9 codes and ICD-10 codes are selected during the coding process. Some practices rely on independent selection of each code, while others rely on the General Equivalence Mappings (GEMs). GEMs were developed to assist industry migration to ICD-10. They are intended to be used primarily for translations of code lists or code tables used by an application or other coded data when codes in one code set are the only source of information; they are not intended as a substitution for direct use of ICD-9-CM and ICD-10-CM/PCS.4 Manual coding enhances coding efficiency and also identifies physician documentation deficiencies. Dual coding should begin as soon as possible, prior to October 1.

End-to-end testing is an opportunity to submit test claims to CMS with ICD-10 codes; providers will receive a remittance advice that explains the adjudication of the claims.5 This testing is limited to a small group of providers who were required to register in April, and its final week is July 20-24.

Over the next couple of months, find the time and resources to audit physician documentation based on ICD-10 criteria. Ask yourself whether or not the information contains enough specificity to select the best possible code, or does code selection default to an “unspecified” code?

Provide Feedback

The importance of feedback is often understated. Many physician practices do not have the time to plan ahead and, as a result, find themselves in a reactive rather than proactive role. Over the next couple of months, find the time and resources to audit physician documentation based on ICD-10 criteria. Ask yourself whether or not the information contains enough specificity to select the best possible code, or does code selection default to an “unspecified” code?

Avoid “unspecified” codes when possible in preparation for payer policy revisions that are aimed at reducing or eliminating these types of codes. If the documentation lacks detail, educate physicians on the missing elements.

Review ICD-10 code sets with physicians to improve their understanding of the new system. For example, diabetes mellitus is identified in ICD-9 as one category (250.xx), with digits to specify Type I or Type II, controlled vs. uncontrolled, with or without complications. ICD-10 separates diabetes into categories of Type I (E10) or Type II (E11), with subcategories to identify complications and affected body systems, thereby expanding the volume of codes and corresponding documentation criteria.6

Post-implementation feedback will become even more important. Monitor claim denials for invalid codes and medical necessity issues (i.e., valid codes not included for coverage). If the medical necessity denials are a result of inaccurate code selection related to insufficient documentation details, provider education will be crucial in resolving these errors. Continuing education to strengthen and update staff skills is imperative.

CMS has developed many tools and resources to promote a successful transition and assess your ICD-10 preparedness. Physician practices can develop an “action plan,” learn basic ICD-10 concepts, and much more.

Carol Pohlig is a billing and coding expert with the University of Pennsylvania Medical Center, Philadelphia. She is also on the faculty of SHM’s inpatient coding course.


  1. Centers for Medicare and Medicaid Services. Road to 10: the small physician practice’s route to ICD-10? Accessed June 6, 2015.
  2. Department of Health and Human Services. Centers for Medicare and Medicaid Services. Medicare Learning Network: ICD-10-CM/PCS Myths and Facts. Accessed June 6, 2015.
  3. Centers for Medicare and Medicaid Services. ICD-10: ICD-10 Basics for Medical Practices. Accessed June 6, 2015.
  4. American Health Information Management Association (AHIMA). Putting the ICD-10-CM/PCS GEMs into practice. Accessed June 6, 2015.
  5. Novitas Solutions. Medicare JL, Part B. ICD-10 Implementation. Accessed June 6, 2015.
  6. Centers for Medicare and Medicaid Services. ICD-10 Coding and Diabetes. Accessed June 6, 2015.

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