After months of planning, training and not a little angst, the long-awaited ICD-10 coding transition has come and gone. For those who prepared properly, the change-over was anti-climactic. But that doesn’t mean the hard work is over.
Instead, now is the time for physician groups to bear down on key performance indicators (KPIs) to make sure their revenue cycle is functioning properly and cash flow is stable. Hyper-vigilance over the next few months should help identify problems and bottlenecks before they can cause significant financial damage.
“Practices can’t afford to let their guards down just because we’re through the transition,” said Susan Moore, senior manager of business process for McKesson Business Performance Services (McKesson.)
“Most organizations already are tracking KPIs to a greater or lesser extent. But the difference now is that instead of watching them on a weekly or monthly basis, you need to scrutinize these metrics on a daily basis, at least initially, to get an accurate and comprehensive understanding of how well the post-ICD-10-implementation revenue cycle is performing.”
According to Moore, the following KPIs are essential:
- Daily charges/claims: Groups should track charge postings, including both the number of charges and the dollar amount, each day at least through the end of October. Comparisons should be made to pre-ICD-10 baseline levels.
Groups should remember that daily charges for dates of service from September still need to be coded in ICD-9; ICD-10 kicks in for dates of service on and after October 1, as mandated payer by payer.
- Clearinghouse/payer edits: Practices should monitor claims as they flow through their clearinghouse to the payer. Compare to baselines the claim volumes, clearinghouse front-end rejections and payer front-end rejections. This review should occur on a daily basis for each payer through the end of October, then weekly through November. Typically, a front-end rejection notice arrives within 0-3 days of claims submission and is usually not the result of problems with coding. Instead, rejections are most frequently triggered by an invalid policy number, bad patient demographic data or a date of service outside the coverage period.
Because many physician groups rely on external data feeds from hospitals and referral partners for patient demographic information, tracking rejections is essential. The problem could be embedded in the interface with the partner organization, or it may originate within the partner’s system itself There could also be issues with the payer and clearinghouse platforms, given the many unknowns surround ICD-10-related changes made in payer edit engines. Regardless of its origin, the rejection needs to be resolved as quickly as possible to avoid a bottleneck of rejected claims. Again, Moore said, the key in tracking rejections will be to compare their number and nature to pre-ICD-10 baseline levels.
- Requests for Additional Information (RAI): RAIs are usually issued by a coder who requires additional clinical documentation or clarification to complete the coding of a service event. Once again, by closely monitoring the number of, and reasons for, RAIs, revenue cycle managers will be able to quickly determine if a specific physician is providing documentation that is deficient for ICD-10 coding.
- Denials: Denials should be tracked in real time at least through mid-November by comparing the numbers and reasons to pre-transition baselines. Once a denial comes in, the accounts receivable team must quickly look backward to identify the point at which the problem occurred and, as required, send an RAI to the coder or physician to resolve the open issue.
But it is again important to remember that the problem may not be due to a documentation or coding error. Because payer adjudication systems have been modified extensively to accept ICD-10 claims, a glitch in their software may be erroneously triggering denials.
- Reimbursement Rates: Actual payments should be matched against claims for each payer to the greatest extent possible. Groups may want to focus on the top 10 or 20 services they provide and then audit the payments to determine if the insurer paid the agreed-upon amount. Uncertainty surrounding the efficacy and accuracy of payers’ adjudication platforms make this KPI an essential one to monitor. Groups should be on the lookout not only for underpayments but also overpayments. The last thing any provider needs is a major payer liability that comes to light weeks or months after the ICD-10 transition.
If they haven’t already, Moore said groups should identify a grid of contact personnel for all their payers and/or clearinghouses. This will allow accounts receivable staff to quickly make contact in the event a problem seems to be originating outside of the practice.
If groups are diligent in tracking KPIs through the remainder of 2015 and work to quickly resolve any troubles that develop, Moore said, they should be in a strong position to move into 2016 with a healthy revenue cycle.
“These are the final due diligence measures to help you make sure that the ICD-10 transition has a minimal impact to your business,” she said. “Transition teams may believe their work is done after October 1, but in truth, it has just begun. Every milestone in the claim lifecycle must be fully exercised in ICD-10 and confirmed as performing as per the KPI baselines. This tedious effort is required to quickly identify negative impacts, remediate, and protect your cash flow.”