Stand-alone ICD-10 Revenue Impact Testing

Stand-alone ICD-10 Revenue Impact Testing

Due to delays in vendor ICD-10-ready product releases and complexities involved with ICD-10 migration, multiple cycles of testing needs to be performed to mitigate risks. Traditionally providers conduct application testing, internal testing, external testing, and revenue impact testing sequentially. This will not allow a sufficient testing window for revenue impact testing resulting in compromising the revenue predictability.

By: Yaron Kottler and Subba Jevisetty

Given the sheer volume and specificity of new codes within ICD-10, hospitals subject to code-based reimbursement are at risk of changes in payment for the services they deliver. Payers are implementing mapping/crosswalk solutions for mapping between ICD-9 and ICD-10 codes to process the claims and reimburse providers for their services based on General Equivalence Mappings (GEMs) developed by the Centers for Medicare & Medicaid Services (CMS) and the National Center for Health Statistics (NCHS).  According to GEMs, only 5 percent of ICD-10 codes match exactly to ICD-9 codes and 24 percent of the ICD-9 codes match exactly to an ICD-10 code. This mapping complexity results in a shift in Diagnosis Related Groups (DRGs).  Most payers reimburse claims based on DRGs. Due to the DRG shifts occurring as part of the ICD-10 migration after October 1st, 2014, providers will not be reimbursed at the same rate when coded in ICD-10 for the same services coded in ICD-9. For some time into the implementation, there will be mistakes and human errors in ICD-10 coding/documentation by physicians, nurses, clinical staff and coders.  Due to these factors, claims can be delayed, denied, pended or reimbursed with under/overpayments. This will have unintended consequences upon the overall revenue stream which will put provider operations into jeopardy.

Due to delays in vendor ICD-10-ready product releases and complexities involved with ICD-10 migration, multiple cycles of testing needs to be performed to mitigate risks. Traditionally providers conduct application testing, internal testing, external testing, and revenue impact testing sequentially. This will not allow a sufficient testing window for revenue impact testing resulting in compromising the revenue predictability.  This is depicted below:

icd10-stand-alone-testing1

 

To address these challenges, QualiTest has developed a Stand Alone ICD-10 Revenue Impact Testing solution that accommodates starting the process as early as vendor products are ready concurrently with other testing cycles, and includes its Golden Dataset of peer reviewed dual coded medical and 5010 claim records, test automation accelerators, and impact analytics. The timeline for this solution is depicted below:

icd10-stand-alone-testing2

 

 

The Stand Alone ICD-10 Revenue Impact Testing does not depend on provider internal testing or claims creation. Since the Golden Dataset contains dual-coded medical records with corresponding 5010 claim records, revenue impact testing can be conducted using 5010 claim records (837) as a starting point.  Both ICD-9 and ICD-10 5010 claim records (837) will be modified with the provider’s test/real patient IDs and payer information to match with payers’ member information, and sent to clearing houses/payers for claims adjudication. After receiving reimbursements/remittance advice (835), ICD-9 and ICD-10 payments will be compared and payment variances will be resolved collaboratively with payers.   This solution is depicted below.

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