Will ICD-10 mean financial hit for pediatricians?

Pediatric practices could suffer significant financial disruption and administrative errors during the transition from International Classification of Diseases, 9th Revision (ICD-9) to ICD-10 procedural and diagnostic codes, a study reports. Investigators estimated that code conversions might lead to loss of Medicaid reimbursement in roughly 8% of pediatric encounters.

The US healthcare system will switch to the International Classification of Diseases, 10th Revision, Clinical Modification on October 1, 2015. Little is known about how the change from ICD-9 with its 14,000 codes to ICD-10 with 68,000 codes might affect pediatric practices logistically and financially. Researchers at the University of Illinois at Chicago examined the potential for clinical ambiguity of information and financial disruption in billing codes frequently used by pediatricians.

Using statewide, pediatrician-specific data from Illinois Medicaid, the investigators identified 2709 ICD-9 pediatric diagnosis codes and converted them to their ICD-10 counterparts with the Centers for Medicare and Medicaid Services’ general equivalents mappings tool. After mapping, they grouped the ICD-9 codes into 5 categories according to the complexity of conversion to IDC-10. The categories ranged from identity (direct equivalence) to convoluted (complex mappings that make conversion difficult).

Physicians evaluated the 636 convoluted codes for clinical accuracy and sorted them into 4 groups: information loss (obscuring of an important diagnostic distinction with potential loss of relevant clinical detail); overlapping categories (a distinction without a clinically relevant difference or potential cause of confusion in code assignment); inconsistent (ICD-10 codes clinically different from ICD-9 codes to which they mapped); and consistent.

The investigators identified 26% of the diagnostic codes as convoluted: 21% of pediatric patient encounters and 16% of Medicaid reimbursements were associated with convoluted codes. Approximately 8% of pediatric encounters were estimated to be vulnerable to billing errors arising from information loss (3.6%), overlapping categories (3.2%), and inconsistent categories (1.2%).

Pediatricians need to pay special attention to the problematic codes when planning for the transition because many pediatric practices operate on lower margins than other specialties and often are reimbursed at lower rates, especially by Medicaid. Even small financial disruptions-say 3% to 5% of codes leading to billing errors-could have significant effects.

To get weekly clinical advice for today's pediatrician, subscribe to the Contemporary Pediatrics eConsult.