ICD-10 implementation has been delayed by the Centers for Medicare and Medicaid Services until October 2015. Despite past and potential future delays, providers must appreciate that many current managed care agreements likely include binding language that will impact reimbursement changes resulting from ICD-10 implementation, particularly for inpatient services.
Coding discussions to date fail to address that ICD-10 likely will require changes in how plans reimburse for certain services and how coverage is determined.
Under ICD-10, the number of diagnostic codes available for coding healthcare services will go from 13,000 to 68,000. For inpatient services, diagnosis and procedure codes are often grouped through software programs into diagnostic-related groups (DRGs). These “groupers” are central to the claims and payment process for inpatient services because claims payment is based on the DRG. As part of ICD-10 implementation, new DRG “grouper” methodologies will be needed to translate the new codes into DRGs for payment.
For inpatient services, reimbursement rates based on a percentage of what Medicare pays likely will be least impacted. Reimbursement rates based on negotiated case rates tied to specific DRGs likely will be most impacted. As such, case rates will need to be adjusted or reassigned to DRGs within a new grouper methodology.
Some managed care agreements may address ICD-10 conversion by requiring providers and the plan to comply with ICD-10 in claims submission and payment processes as of the implementation date. Agreements for reimbursement of inpatient services based on case rates tied to specific DRGs will require plans to implement new rates in conjunction with ICD-10 implementation. While it’s impossible to predict how such rates will need to change, agreements typically have multiyear terms with limited rights to terminate early.