A February 2014 survey by the Medical Group Management Association indicated that only 10 percent of physician practices were prepared for the ICD-10 conversion, and this lack of provider readiness was a major reason congress pushed back the 2014 deadline. Lacking the expertise in-house and lacking the time and money to seek outside help, many physicians have procrastinated on preparations.

To prevent further delays and to ensure a smooth transition to ICD-10, health plans need to actively engage physicians in their testing process. Even if there are no further delays to ICD-10 implementation – and, indeed, a new compliance deadline of Oct. 1, 2015, has been set - a lack of provider readiness will cause major headaches for health plans.

To start with, unprepared physicians are likely to submit non-specific or inaccurate codes, which will require the health plan to seek more information, reject more claims and generally spend more money to administer claims.

Providers who see an increase in denials or delays of payment due to inaccurate coding will likely be dissatisfied with the health plan. If their dissatisfaction is sufficiently acute, they may contact regulators or legislators to complain about the health plan, creating political problems and a sense that the health plan is acting in bad faith.

None of that is good for either health plans or physicians. Having worked extensively with health plans and physicians, I know how frustrating the claims submittal process can be for both. And I know that many physicians see payers as adversaries. At best, the relationship between health plans and providers has been tinged by a certain wariness, even when there were no major reimbursement problems.

ICD-10 presents an opportunity for both physicians and health plans to forge a collaborative relationship that will lower the administrative hassles and costs for both.

By actively reaching out to physicians, either to involve them in ICD-10 systems testing or to assist them in preparing for ICD-10, health plans can head off many of the potential conversion problems and fix many of the existing problems.

For physicians, the opportunity to work with a health plan’s ICD-10 preparation team will be a godsend. These teams have a vested interest in seeing the system work well, and they understand that clean, accurately coded claims are better for both health plans and physicians. In this instance, the interests of both converge, creating an environment in which a productive collaboration can occur.

For physicians, ICD-10 testing is an opportunity to identify flaws in either their documentation or coding processes before those flaws create delayed payments or underpayment. If they are using poorly trained coders or coders who take short cuts by using non-specific codes, they will be able to see that through the testing. They can then take whatever action is appropriate – further training, or a change in the coders they use.

If the flaw lies in their own documentation, they will also be able to see that, and they will have a financial incentive to participate in one of the many clinical documentation improvement programs available through their local hospital or other organization.

To make their physician engagement programs effective, health plans need to determine where to focus their testing and remediation efforts. An analysis of past claims can help identify physicians whose documentation and claims preparation is flawed under the ICD-9 system. These physicians are the most likely to be unprepared for the new documentation requirements of ICD-10 and the most likely to need training and other help. Conversely, physicians whose documentation and coding practices have been stellar under ICD-9 are more likely to be ready for ICD-10 and would be good candidates for collaborative systems testing. 

Since health plans and physicians have invested a lot of time and money in preparing for ICD-10, a smooth conversion will help them reap the benefits of the new system. The new codes will be far richer in detail than the ICD-9 codes. For health plans and physicians, the specificity of the new codes will mean less back and forth requesting more information and delaying claims. That should translate into lower administrative costs for both and more timely payments for physicians.

The richer detail will also give health plans more insight into secondary and tertiary conditions. Let’s look at the example of a claim that comes in using a code that indicates the patient is a woman who is pregnant, diabetic and using both diet and medication to control her disease. If the health plan did not previously know about the diabetes, the code should alert the health plan to reach out to both physician and patient to ensure that proper treatment protocols are in place to offer the best chance for an uncomplicated delivery of a healthy baby. Physician, patient and health plan all have both a humanitarian and financial incentive to seek the best outcome possible. The detailed ICD-10 code in this case can facilitate treatment for the best outcome. It may also save the physician from having to explain to the health plan why they need to pay for more office visits and special care for the patient.

These short term payoffs are worthwhile, but there are additional benefits that will accrue over time. The codes will facilitate population studies of patient conditions, treatments and outcomes, reducing the amount of data mining needed to get the information needed for analysis. It will likely take several years before there is enough coded data for analysis, and more time after that for the analytic tools to be developed and tested. But eventually, the ICD-10 codes should yield insights that help us all live healthier lives.