The looming ICD-10 code conversion could prove especially challenging for pathology groups due to their dependence on external hospital data feeds for populating pathology claims, a McKesson expert says.

Because pathologists seldom encounter patients directly, the electronic transmission of diagnosis codes and demographic data from partner hospitals is essential, according to Eddie Miller, vice president of pathology services for McKesson Business Performance Services (McKesson). Particularly important is the electronic transmission of diagnosis codes for high volume services involving the professional component of clinical pathology (PCCP).

As a result, if a hospital hasn’t yet made plans to ensure accurate transmission of the codes or is delayed in establishing ICD-10-compliant interfaces, pathology practices could face major cash shortfalls, Miller stated. Approximately 18% of all pathology revenue currently derives from PCCP, according to McKesson financial data.

Survey underscores risk

A survey of 650 hospitals conducted by McKesson earlier this summer revealed that 53% of hospital interfaces with pathology groups will require significant re-work by either the physician group’s billing vendor or in-house billing staff to accommodate ICD-10 diagnosis codes. Another 16% of hospitals haven’t yet made plans to ensure that their data feeds will be ICD-10 compliant. Interfaces for the remaining 31% of hospitals will require minor tweaks to successfully transmit ICD-10 codes, Miller said. These changes can typically be accomplished by the physician’s billing software manager.

Of additional concern, Miller said, are the approximately 4% of McKesson client hospital partners who are in the midst of migrating to, or upgrading, hospital information systems (HIS) or laboratory information systems (LIS). Establishing viable physician interfaces could be a low priority for hospitals scrambling to complete costly and extensive enterprise-wide technology implementations.

“All pathologists need to understand where their hospitals fit within this paradigm,” Miller said. “What are their plans for making the change? When are they going to do it? How soon will they be able to send test files to the pathologists?”

Miller said McKesson pathology clients should immediately communicate with their client managers about the status of hospital feeds. They should also work to facilitate direct dialog between the hospital and McKesson representatives in order to reduce the likelihood of problems once ICD-10 takes effect. Non-clients likewise should reach out to their billing partners to jointly develop a clear understanding of the hospital’s plans.

Consolidating AP coding

When it comes to anatomic pathology (AP), Miller said pathologists frequently provide one or more of the three elements required to accurately code AP: the CPT code, ICD-9/ICD-10 diagnosis code and the appropriate modifier, if applicable. Because physicians who are currently coding may not be fully up to speed on the new ICD-10 codes and modifiers by October 1, McKesson is recommending to its pathology clients that they allow McKesson to provide the three elements of AP billing. Doing so should significantly reduce the risk of inaccurate ICD-10 codes being submitted for AP, Miller explained. Practices that are not McKesson clients should talk to their billing vendor to determine how best to proceed.

Payer connectivity

One final aspect of the ICD-10 conversion that pathology groups must be cognizant of involves the processing of claims once they’ve been submitted. Because there can be no guarantee that payers will be prepared to accurately review, adjudicate and pay ICD-10 claims, groups need to complete end-to-end testing ahead of time. This applies not only to commercial payers but clearing houses and Medicare and Medicaid administrators.

“Pathologists basically need to take ownership of the entire revenue cycle until they’re certain that their hospital is ready to go and their billing solution is on top of it,” Miller said.


About the author

McKesson Business Performance Services offers services and consulting to help hospitals, health systems, and physician practices improve business performance, boost margins and transition successfully to value-based care.