The transition to ICD-10 is one of the biggest changes to healthcare which will ensure greater specificity and accurate health trends’ tracking. Without doubt, this transition will be difficult. During the changeover, a drop in productivity by 30% to 60% is expected. The duration of this productivity drop depends on your practice’s size, how trained your coders are, denial management techniques and contingency measures to overcome cash flow disruptions.
Financial Costs of the ICD-10 Conversion
The financial costs of ICD-10 conversion close in at $83,000 for a practice consisting of 2 physicians according to a 2008 study. A greater sum of the costs is due to increased documentation expenditure. 25% of the cost of ICD-10 disruptions is because of cash flow disruptions.
Why Documenting and Coding Will Take More Time
Most of the alterations that ICD-10 brings are about code organization, composition, detail level and structure. The new jargon is to be used for all documentation and also supports medical necessity and diagnosis reporting. Failing to do so will cause a spike in the claim rejections.
Canada’s Dip in Productivity Following ICD-10 Transition
We can learn from Canada’s transition to ICD-10. Productivity dropped before, during and after the transition and took six months on average to regain stability. The drop in productivity is attributable to slower claim processing, training time, inquiries from coders and questions regarding medical billing from payers.
Its important point to note here is that Canada does not use coding for compensations which essentially means that ICD-10 in the United States is more intricate.
Possible Cash Flow Issues after ICD-10 Implementation
Practices that have done almost everything to prevent a drop in productivity can also expect a stoppage in medical billing. A delay of 10 days in Accounts Receivable is inevitable during the transition. Failing to take pre-emptive measures can cause a decrease in cash reserves fast.
Productivity loss can be minimized greatly by adopting training and practice time for the medical billing staff. There is no use denying that cash flow problems will be eliminated altogether. It is also advisable to prepare credit or cash reserves to lessen the impact of the ICD-10 transition on the revenue management cycle.