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Shape your ICD-10 Technology Strategy: Be Ready for Change and Protect Revenue

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Page 1: Shape your ICD-10 Technology Strategy: Be Ready for Change and Protect Revenue

1Confidential property of Optum. Do not distribute or reproduce without express permission from Optum.

1

Page 2: Shape your ICD-10 Technology Strategy: Be Ready for Change and Protect Revenue

Shape your ICD-10 Technology Strategy: Be Ready for Change and Protect Revenue

Mark Morsch, Vice President of Technology, Optum

Page 3: Shape your ICD-10 Technology Strategy: Be Ready for Change and Protect Revenue

3Confidential property of Optum. Do not distribute or reproduce without express permission from Optum.

Agenda

• ICD-10—Brief Overview

• Hospital Impact Areas

• Spotlight Risk—Productivity and Reimbursement

• Model ICD-10 Project Plan

• New Technologies for ICD-10

Page 4: Shape your ICD-10 Technology Strategy: Be Ready for Change and Protect Revenue

4Confidential property of Optum. Do not distribute or reproduce without express permission from Optum.

ICD-10 brief overview

• New federal regulation for coding of patient charts that organizations must comply with in order to be reimbursed for charges

• More detailed reading of medical records

• Provides much better data for use by providers, government, payers

• Challenge = huge education, reimbursement, resource issue

Dramatic increase in number of codes that capture conditions of a patient and medical

services provided—

from 18,000 ICD-9 to 155,000 ICD-10 codes

Page 5: Shape your ICD-10 Technology Strategy: Be Ready for Change and Protect Revenue

5Confidential property of Optum. Do not distribute or reproduce without express permission from Optum.

ICD-10 hospital impact areas

• Payer contracts• Medicare

reimbursement• Coding and billing

• System upgrades• Testing/validation• Vendor selection

• Physician documentation

• CDIP• Registries and

outcomes reporting

FinancialRegulatory

ClinicalTechnology

ICD-10

• HIPAA 5010• ICD-10• Meaningful use

of EHR• Quality reporting

Page 6: Shape your ICD-10 Technology Strategy: Be Ready for Change and Protect Revenue

6Confidential property of Optum. Do not distribute or reproduce without express permission from Optum.

ICD-10 impact on productivity, revenue

Productivity Denials Undercoding

Financial Impact -350000 -400000 -900000

$(950,000)

$(850,000)

$(750,000)

$(650,000)

$(550,000)

$(450,000)

$(350,000)

$(250,000)

$(150,000)

$(50,000)

Projected Annual Financial Impact of ICD-10: Typical 500 Bed Hospital

Do

llar

Im

pac

t

Sources: Advisory Board Financial Leadership Council, Revenue Cycle Performance Assessment, 2008; Robert E. Nolan Company, Replacing ICD-9-CM with ICD10-CM and ICD-10-PCS: Challenges, Estimated Costs, and Potential Benefits, October 2003; RAND, The Cost and Benefits of Moving to the ICD-10 Code Sets, 2004

Page 7: Shape your ICD-10 Technology Strategy: Be Ready for Change and Protect Revenue

7Confidential property of Optum. Do not distribute or reproduce without express permission from Optum.

Scope of potential business impact areas

5010/ICD-10: Provider Functions/Applications Impact

• Central, ED, Ancillary and Ambulatory Registration

• Scheduling

• Admitting/Discharge/ Transfers

• Referrals/Authorizations/ Pre-Cert

• Bed Management

Patient AccessClinical and

Ancillary

Health Information

Management

Patient Financial Services

Analytics and Reporting

• Physician and Nurse Documentation

• Ancillary and Support Services Documentation

• Order Entry and Results

• Workflow within EMR

• Case Management

• Clinical Registries and Research

• Workflow/Transfers Between Clinical Units

• Coding and Abstracting

• Deficiency Tracking

• Claim Edit Work Lists

• NCCI/LMRP Edits

• Encoding and Grouping

• Physician Query

• Clinical Documentation Improvement

• Charge Entry

• Payer/Clearinghouse Edits

• Contracting and Credentialing

• Facility and Professional Billing

• Follow Up and Denial Management

• Claims Status

• Quality/Outcomes Reporting

• Financial/Revenue Reporting

• Public Health Reporting

• Quality Reporting (CMS/ JCAHO, PHC4, PHCQA)

• Data Warehouse

• ICD-9 to ICD-10 Mapping and Translation

Organizational Support: Project Management—Education and Training—Compliance—IT

People Systems

Strategic Initiatives

• Implementation of New Business and/or Clinical Systems

• Transition to Paperless Environment

• Opening of New Facility

• Narrowing of IT Vendor Portfolio

• Implementation of Computer-Assisted Coding

Page 8: Shape your ICD-10 Technology Strategy: Be Ready for Change and Protect Revenue

8Confidential property of Optum. Do not distribute or reproduce without express permission from Optum.

Investigate Innovate Implement Improve and Operate

Phase 1

• Identify business impact areas• Facilitate ICD-10 impact assessment kick-off and

educational session with key stakeholders• Conduct onsite ICD-10 impact assessment of all impacted

business areas• Conduct ICD-10 reimbursement and coding impact

analysis• Conduct clinical data quality assessment• Conduct risk assessment • Develop ICD-10 recommended education and

training approach• Develop ICD-10 roadmap to readiness• Conduct payer and vendor readiness assessments• Present findings and recommendations to key stakeholders

• Project governance• Implement education

and training program• Technical resourcing• Testing, design and

management• Operational and

systematic workflow redesign management

• Implement clinical documentation improvement program

• ICD-9 to ICD-10/ICD-10 to ICD-9 mapping and translation

• End-state measurement and documentation

• Implement review and improve process

• Customer coaching• Implement

compliance program

Program Remediation and Implementation

Business Readiness and Roadmap

Ongoing Monitoring and Improvement

Our multi-phased approach ensures that your ICD-10 compliance requirements are met and your organization is engaged, ready and maximizing business value

Model 3-phase plan

Phase 1 Phase 2 Phase 3

Project Management

Page 9: Shape your ICD-10 Technology Strategy: Be Ready for Change and Protect Revenue

New technology for ICD-10

Page 10: Shape your ICD-10 Technology Strategy: Be Ready for Change and Protect Revenue

10Confidential property of Optum. Do not distribute or reproduce without express permission from Optum.

History:

• Diabetic patient brought by ambulance to the Emergency Room after spouse called 911 when patient complained of a sudden, severe headache, with left-sided weakness, and aphasia. Thrombolytics (tPC) were administered prior to transport.

• Imaging confirmation of right mid cerebral artery occlusion

Final Diagnoses:

1. Cerebrovascular infarction due to cerebral artery occlusion

2. Left hemiparesis

3. Aphasia

ICD-9434.91 (Unspecified Cerebral Artery Occlusion w/Infarction)

438.22 (Unspecified Hemiplegia Affecting non-Dominant Side)

438.11 (Aphasia)

DRG: 065 Weight: 1.1667 National Payment: 6,024.97

Under-coding risk—an example

ICD-10I63.511 (Unspecified Cerebral Artery Occlusion w/Infarction)Z92.82 (status post administration of tPA (rtPA) in a differentfacility within the last 24 hours prior to admission to currentfacility) I69.53 (Unspecified Hemiplegia Affecting non-Dominant Side)I69.928 (Aphasia)

DRG: 062 Weight: 1.9479 National Payment: 10,059.17

Page 11: Shape your ICD-10 Technology Strategy: Be Ready for Change and Protect Revenue

11Confidential property of Optum. Do not distribute or reproduce without express permission from Optum.

Supporting the process

How does context shape coding decisions?

Medical Record

Diagnostic Tests

Past Medical History

Admission Notes

Procedural Notes

Progress NotesConsultant or

Specialist Notes

Discharge Summary

Page 12: Shape your ICD-10 Technology Strategy: Be Ready for Change and Protect Revenue

12Confidential property of Optum. Do not distribute or reproduce without express permission from Optum.

Clinical documentation support

Where are the gaps?

Current Symptoms

Medical History

Findings

Diagnosis

Treatment

New or existing problem?

Findings relevant or incidental?

Diagnosis complicated by chronic condition?

Which symptoms related to final diagnosis?

How is the treatment supported by medical

evidence?

Page 13: Shape your ICD-10 Technology Strategy: Be Ready for Change and Protect Revenue

13Confidential property of Optum. Do not distribute or reproduce without express permission from Optum.

Computer-assisted coding at a glance

• Establishes a link between the assigned code and the text that supports the code

Computer-assisted coding

• Can “read” physician documentation, identify key clinical facts, map to codes

• Physicians use standard dictation, transcription, speech recognition, templates with free-text fields

Natural Language Processing (NLP)

Page 14: Shape your ICD-10 Technology Strategy: Be Ready for Change and Protect Revenue

14Confidential property of Optum. Do not distribute or reproduce without express permission from Optum.

Support for clinical documentation and HIM

• Clinical Documentation Improvement programs are being adopted along with CAC

• Conventional approaches to CDI often labor-intensive and expensive • Opportunity to apply NLP technology

CDI

• Laterality of injury• Trimester of pregnancy• More detailed anatomy

Increased Detail

• Retrospective processes may not be effective• Concurrent coding—identify documentation deficiencies concurrent with

patient stay• Physician query integrated with the EMR• Real-time documentation alerts

Clinician Feedback

Page 15: Shape your ICD-10 Technology Strategy: Be Ready for Change and Protect Revenue

15Confidential property of Optum. Do not distribute or reproduce without express permission from Optum.

A closed-loop health system performance improvement solution

Clinical Data

Physician Documentation,

Nursing Documentation,

Orders, Results …

NLP-poweredTranslation

Engine

Converts discrete and non-discrete clinical data

into consistent quality, cost and revenue

terms

CPT, ICD-9(10)

Quality Metrics

Adherence to Guidelines

Documentation Deficiencies

ACO Dashboard

Revenue Cycle Dashboard

Physician Productivity Dashboard

Analytics

Best Practices Benchmarks

Key Metrics Performance Monitoring

Episode Treatment Grouping

Hospital Billing and Practice Management Systems

Documentation Feedback and Care Delivery Support - Supports ongoing CDI initiatives- Physician-to-physician dialog regarding guideline

adherence and diagnosis specificity

Quality Dashboard

Cost/Utilization Dashboard

Configure Interactive

Clinical Alerts and Prompts

HIE

Page 16: Shape your ICD-10 Technology Strategy: Be Ready for Change and Protect Revenue

16Confidential property of Optum. Do not distribute or reproduce without express permission from Optum.

Key technology takeaways and lessons learned

• Understand CAC and CDI products: What will they do (and not do)– Define your expectations/educate team on expectations

• Understand the NLP technology

• Get HIM and compliance staff acceptance and over communicate– Involve coders early in the process and throughout project, testing

• Preparation work is key to success

• Review present work processes and data flows before implementation

• Establish, track and monitor metrics

• Be prepared for a learning curve

Page 17: Shape your ICD-10 Technology Strategy: Be Ready for Change and Protect Revenue

Case Study

Page 18: Shape your ICD-10 Technology Strategy: Be Ready for Change and Protect Revenue

18Confidential property of Optum. Do not distribute or reproduce without express permission from Optum.

Case study

• 8 member hospitals in the Midwest

• 5 hospitals implemented CAC initially

• 24 health centers/ambulatory sites

• Volume data for 5 facilities– 91,000 inpatient encounters

– 576,200 outpatient and ED encounters

• Challenges: growth in patient volumes and pending regulatory changes– Increasing coder workload

– Limited labor pool

– Expense associated with recruitment and training

– ICD-10 predictions on labor requirements

– Escalating emphasis on compliant coding

Page 19: Shape your ICD-10 Technology Strategy: Be Ready for Change and Protect Revenue

19Confidential property of Optum. Do not distribute or reproduce without express permission from Optum.

Hospital results

• Integrated CAC technology with current EMR workflow

• Using NLP to interpret electronic inpatient and outpatient documentation

• Increased productivity—this continues as coders become more proficient on system– 190% ↑ diagnostics coding productivity

– 116% ↑ ED coding productivity

– 15% ↑ inpatient coder productivity

• Improved accuracy: greater than 95%

• Improved consistency and compliance of codes

• Increased revenue and reduced expenses– 5.16 FTEs: salary ↓ through position attrition

• $245,181 FY11 YTD (July 1, 2010–April 30, 2011)

– With benefits, this is $301,573

Page 20: Shape your ICD-10 Technology Strategy: Be Ready for Change and Protect Revenue

Thank you.

Mark Morsch, Vice President of [email protected]