implementing new hipaa transactions version 5010

Now Is The Time!

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Final Rules Issued To Change HIPAA StandardsOn January 16, 2009 HHS published 2 Final Rules

One upgrading X12 and NCPDP HIPAA administrative transactions, with a January 1, 2012 compliance date

One replacing ICD-9-CM with ICD-10-CM for diagnoses ICD-10-PCS for inpatient hospital procedures With an implementation date of Oct 1, 2013 for the

change (services provided on or after that date)

That was two years ago!

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Transaction Standard Upgrades

(Why Change?)

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A New Version of HIPAA Standards

Not a brand new set of standards, but an “upgrade”

Developed in response to numerous suggestions over the years since initial HIPAA implementation

Allows for the use of ICD-10 codes which must be used for services on and after Oct 1, 2013.

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Dual Use PeriodFinal rules for transactions allow use of

either old or new standard until the Jan 1, 2012 compliance date

“Willing trading partners” can move to the new standards before the compliance date – you cannot be forced to move.

Means a spread out testing and transition period, easier for the industry.

Must use by Jan 1, 2012.

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What Do New Standards (Version 5010) Bring• Improvements for business• Clarity and consistency in instructions for

use of each transaction• More uniformity in situations to minimize

differences in usage among health plans – fewer “companion guides”.

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What Does 5010 Bring Claims

Enables use of POA indicator Separates diagnosis code reporting Clarifies use of NPI

Lowest level of granularity for all reporting Eliminates “pay-to” provider, must pay to

billing provider; Required minutes for anesthesia as opposed to

units or minutes Provides greater consistency between dental

and professional claims.

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What Does 5010 Bring• Remittance advice

• Clarifies rules for use• Improves balancing• Can be used with 4010 claims• Includes medical policy segment – explains why

claims denied

• Enrollment/Disenrollment• Improves privacy protection• Adds information such as enrollment subtotals

and coverage reasons

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What Does 5010 Bring• Premium Payment

• Allows for additional payment deductions• Premium remittance detail information now

required

• Eligibility inquiry/response• Adds required benefit categories and service

type codes – more specific information by service type

• Clarifies dependent and subscriber relationships

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What Does 5010 Bring• Referral/Authorization Certification

• Adds necessary functionality for use Specific information on conditions Number of occurrences Separate segments for key patient conditions Supports and expands authorization exchanges

• Will allow use of this transaction to meet business needs.

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What Does 5010 Bring• Claims Status Inquiry/Response

• Allows prescription number reporting• Eliminates sensitive information to satisfy

privacy concerns• Instructions for batch and real time use

• Coordination of Benefits• Improves instructions and eliminates many

ambiguities in creating the transaction

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ImplicationsBetter information on electronic transactionsTransactions more useful for business

purposesMay be able to automate certain functionsShould encourage more use of eligibility and

remittance advice transactionsYou can start using the better transactions

soon!

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“The Errata”After publication, some technical issues arose

with the standards.The standards organization (X12) fixed the

standards by publishing Errata additions to the standards.

These were relatively small fixes, but they must be put in place by the Jan 1, 2012 deadline.

These fixes are now part of the standards.

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The Jan 1 2012 Deadline is RealCMS has insisted that there will be no extensions of

the deadline.Medicare will start testing with providers in Jan 2011,

but without the errataMedicare will start testing with the errata on April 1,

2011.Expected that most other health plans will follow suit.Only the new standards will be used Jan 1, 2012 and

after.

Providers must be ready or face payment delays in Jan 2012.

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ImplementationTrainingInstall the software

Need time for testingMake the business changesTest, test, test. This is your income!Test with as many trading partners as

possible before you move into production.Implement the changesCheck the impact

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Key Questions to Ask VendorsWhen will you be upgrading my system to handle the

5010 version of the HIPAA transactions?Which transactions do you support? (claims,

remittance, claims status, eligibility, prior authorization)

How have you tested your software to assure that it works?

Will I be able to continue sending the older version (4010A1) of the transactions to health plans until they convert, as well as sending the new version to those health plans that can already accept it?

How long will it take to be trained on the new software? Is that included in the upgrade price?

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Key Questions for VendorsWhat changes in my business processes do I need

to make to accommodate the new transactions?Will your software electronically interface with

my EHR?What support will you provide after installation?Have the Errata changes already been made in

your software? If not, when will they be made?What are your plans for implementing ICD-10, the

Health Plan ID, and Operating Rules?

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Key Questions for Health PlansWhat is your schedule for upgrading to

Version 5010?Do you have a companion guide available?When can I start testing?What happens if I am not ready by Jan 1,

2012?What materials do you have available to help

me?

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ResourcesCMS

Medicare web site, conference calls, contractors

WEDIWeb site (www.wedi.org), conferences,

audiocastsAMA, State Medical SocietiesHealth plan web sites

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So What Is the Big Deal with ICD-10?Codes change every year anywayTransaction version changes (X12 version

5010) will be in place to handle the codesWhy not business as usual?

21Nachimson Advisors, LLC

Major changes from ICD-9 to ICD-10Not just the usual annual updateICD-10 markedly different from ICD-9Requires changes to almost all clinical

and administrative systems.Requires changes to business processes.Changes to reimbursement and coverage.Why?


Specific ChangesDiagnosis Codes (ICD-9 to ICD-10-CM)

Goes from 5 positions (first one alphanumeric, others numeric) to 7 positions, all alphanumeric

From 13,000 existing codes to 68,000 existing codes

Much greater specificity


Structure of ICD-10


Examples of ICD-10-CM Specificity Diabetes mellitus codes are expanded to include the classification of the

diabetes and the manifestation. The category for diabetes mellitus has been updated to reflect the current clinical classification of diabetes and is no longer classified as controlled/uncontrolled:

E08.22, Diabetes mellitus due to an underlying condition with diabetic chronic kidney disease

E09.52, Drug or chemical induced diabetes mellitus with diabetic peripheral angiopathy with gangrene

E10.11, Type 1 diabetes mellitus with ketoacidosis with coma E11.41, Type 2 diabetes mellitus with diabetic mononeuropathy1


Examples of ICD-10-CM Specificity

ICD-9-CM 599.7 Hematuria (blood in urine)

ICD-10-CMR31.0 Gross hematuria R31.1 Benign essential microscopic hematuriaR31.2 Other microscopic hematuria R31.9 Hematuria, unspecified


Examples of ICD-10 SpecificitySports injuries now coded with sport and

reason for injury –ICD-9 code - Striking against or struck

accidentally in sports without subsequent fall (E917.0)

24 ICD-10-CM Detail Codes


Examples of ICD-10 Specificity 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 W21.31 Struck by shoe cleats Stepped on by shoe cleats W21.32 Struck by skate blades Skated over by skate blades W21.39 Struck by other sports foot wear W21.4 Striking against diving board

•W21.11 Struck by baseball bat•W21.12 Struck by tennis racquet•W21.13 Struck by golf club•W21.19 Struck by other bat, racquet or club•W21.210 Struck by ice hockey stick•W21.211 Struck by field hockey stick•W21.220 Struck by ice hockey puck•W21.221 Struck by field hockey puck•W21.81 Striking against or struck by football helmet•W21.89 Striking against or struck by other sports equipment•W21.9 Striking against or struck by unspecified sports equipment


Specific ChangesEnables laterality (right vs left designations)

Restructures reporting of obstetric diagnoses In ICD-9-CM, the patient is classified by

diagnosis in relation to the episode of care. In ICD-10-CM the patient is classified by

diagnosis in relation to the patient’s stage of pregnancy


Issue – No Clear MappingNot always one ICD-9 to many ICD-10sNeed more specific information to go from

ICD-9 to 10NCHS has published “GEMs”, general

equivalence tables.Not a clear map


Specific Changes to Procedure Code Reporting (ICD-9-CM to ICD-10-PCS)New Code Set for ICD-10A US creation not used anywhere elseChange from 5 to 7 positionsEach position has a specific meaning.Only used for inpatient hospital proceduresHowever, physician documentation for

procedures will be a critical element.


Structure of ICD-10 PCS


Example of PCS CodeICD-9-CM (sample code)

47.01 Laparoscopic appendectomyICD-10-PCS (sample code)Laparoscopic appendectomy 0DTJ4ZZ

0 - Medical and Surgical Section D - Gastrointestinal system T - Resection (root operation) J - Appendix (body part) 4 - Percutaneous endoscopic (approach) Z - No device Z - No qualifier


Why Make the Changes?Modernize TerminologyIncreased information for public health,

biosurvellience, quality measurementICD-9-CM running out of codes


Why Does This Matter?•Diagnoses and procedure codes impact virtually every system and business process in plan and provider organizations, with significant impacts on reimbursements.


Provider ImpactsDocumentation of diagnoses and procedures

▫ Codes must be supported by medical documentation▫ ICD-10-CM codes are more specific▫ Requires more documentation to support codes▫ Expect a 15% increase in documentation time (per

AAPC)▫ Revenue Impacts of specificity

▫ Denials▫ Additional Documentation


Provider ImpactsCoverage and payment

New coding system will mean new coverage policies, new medical review edits, new reimbursement schedules

Changes will be made to accommodate increase specificity

May need to discuss changes with patients


Provider ImpactsContracts with plans

Coding more specific and includes severity Renegotiations will be based on new coding,

coverage, and reimbursement Difficult to measure what the changes will mean to

overall reimbursement.


Provider ImpactsBilling and eligibility transactionsUpdated transactions include support for

ICD-10New codes mean more specificityHow smooth the transition?Expect increased reject, denials, and pends

as both plans and providers get used to new codes.


Provider ImpactsLaboratory ordersWill need specific ICD-10-CM codes for

laboratory ordersExpect coverage changesNeed to support the tests ordered


Provider ImpactsQuality Measures/P4P

New measures need to be determined based on ICD-10-CM codes

Must renegotiate with provider groupsDifficult to measure impact of change – is it

because of code set or because of changes in underlying practice


Health Plan ImpactsContracting with providers and employersCoverage determinationsPayment determinationsMedical review policiesPlan structuresStatistical reportingActuarial projectionsFraud and abuse monitoringQuality measurements


Expected Implementation and Operational StepsTraining – not just coders.

ProvidersAdministrative StaffSystems Staff

Business Process AnalysisWhere do you use diagnoses/inpatient hospital

procedures?What are the interfaces that may need to be

changed?What databases need to be changed?


Expected Implementation and Operational StepsBudgetingResource AllocationVendor discussionsWorkplanImpact on other initiatives


Expected Implementation and Operational StepsDocumentation/Superbills

Need increased documentation to support codingSuperbills need to be updated/modifiedMay need automated support based on increase in codes.

IT System ChangesSystem analysisProgrammingTesting internallyEnd to end testingPartner testing


Expected Implementation and Operational StepsPatient educationCommunication with plans/trading partnersExternal testingTransition


35 Year-old Male w/ Pancreatitis (Reimbursement Risk = $1,958)

Diagnoses 5770 - Acute pancreatitis27789 – Other specific metabolic disorders

2512 – Hypoglycemia NOS Procedures None

DRG 439 Disorders of pancreas exc. malignancy w CC

$6,144.60ICD

-9-C

MIC

D-1

0-C

M/P

CS Diagnoses K850 - Idiopathic acute pancreatitis

E803 - Defects of Catalase and Perioxidase E162 - Hypoglycemia

Procedures None

DRG 439 Disorders of pancreas exc. malignancy w CC

$6,144.60

Diagnoses K850 – Idiopathic acute pancreatitisE889 – Metabolic disorder, unspecified

E162 – Hypoglycemia

Procedures None

DRG 440 Disorders of pancreas exc. malignancy w/o

CC/MCC

$4,186.20

82 Year-old Female Hip Replacement (Reimbursement Risk = $3,493)

Diagnoses 82003 – Closed fracture of base of neck of femur Procedures 8152 – Partial hip replacement

DRG 470 Major jnt replacement or reattachment, lower

extremity, w/o MCC

$12,462.00

ICD

-9-C

MIC

D-1

0-C

M/P

CS Diagnoses

S72041A - Displaced fracture of base of neck, right femur Procedures 0QR70JZ - Open upper femur replacement w/

synthetic substitute

DRG 470 Major jnt replacement or reattachment, lower

extremity, w/o MCC

$12,462.00

Diagnoses S72041A - Displaced fracture of base of neck, right femur

Procedures 0QR80JZ - Open femoral shaft replacement w/ synthetic substitute

DRG 482 Hip & femur procs

exc. major joint w/o CC/MCC

$8,969.40

What Will This CostTraining - $195 per provider/admin staff,

$1625 per coderBusiness Process Analysis – 3-4 months for a

team to researchChanges to superbillsIT Costs – Much higher than transaction

implementationDocumentation – 15% increase in timeIncreases in claim inquiries, reduction in

cash flow – 1% at a minimum49Nachimson Advisors, LLC

Expected TimingWhen can this start?What other priorities are in line?What needs to be put aside?Remember that HIPAA transaction upgrade

will also be occurringWhat 5010 changes can be done jointly with

ICD-10 changes?How long will this take?


Ideal Timing for ICD-10NCHICA/WEDI Alternative Timeline

Nachimson Advisors, LLC 51

ID Task Name Duration Start

1 Vendor Tasks 1558 days Fri 1/16/092 Primary/Mainframe Vendor Tasks 1044 days Fri 1/16/09

What to do now!Understand the impacts, begin the planning

processTalk to vendorsStart the budgeting process

Identify key staff to beginTrack progress of CMS and NCHS efforts.

Coding guidelinesAdditional information


Basic Education SitesNCHS – Basic ICD-10-CM information

http://www.cdc.gov/nchs/about/otheract/icd9/abticd10.htm

CMS – ICD-10-PCS informationhttp://www.cms.hhs.gov/ICD10/02_ICD-10-PCS.

aspAHIMA - ICD-10 Education

http://www.ahima.org/icd10/index.aspWEDI – ICD-10 Implementation

www.wedi.org


Questions?Stanley NachimsonNachimson Advisors, [email protected]


Questions?Stanley NachimsonNachimson Advisors, LLC

[email protected]

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implementing new hipaa transactions version 5010

Documents

use of icd

use of eligibility

new standards version

usespecific information

implicationsbetter information

dual use periodfinal

brand new set of standards

standards organization