MITA and ICD-10 Support National Quality Strategy

ICD-10 Overview

Analytics and Reporting

Program Integrity

Policy Remediation Best Practices

Managed Care

Claims Management

Provider Communication

Segment 5: Claims Management

June 10-11, 2013

State of California ICDD-10 Site Visit Training segments to assist the State of California with the ICD- 10 Implementation

2

AGENDA Introduction Benefits of ICD-10 ICD-10 Impacts Maintain Stability / Manage

Change CMS Defined Services MITA Business Processes Impact to Payment SMA Programs and Services

Benefits of ICD-10

ICD-10 codes refine and improve SMA operational capabilities and processing. ICD-10 benefits include: Detailed health reporting and analytics: cost, utilization and

outcomes; Detailed information on condition, severity, co-morbidities,

complications and location; Expanded coding flexibility by increasing code length to seven

characters; and Improves operational processes across healthcare industry by

classifying detail within codes to accurately process payments and reimbursements.

3

4

ICD-10 Impacts

Impact to SMA Claims Processing Information Technology Product Development Enrollment Management Reimbursement / Network Management Customer Service Care Management Quality Management Vendor Management

5

Business Impacts

Source: Deloitte. “ICD-10: Turning Regulatory Compliance into Strategic Advantage.” Summer 2009.

6

Impact To ClaimsPre-Adjudication Edits

Eligibility Validation Code Validation Diagnosis Code Validation/DX and procedure tables

7

Impact To ClaimsAdjudication

Field and General Edits Member Eligibility Provider Eligibility and Status Prior-authorization Covered Services Pricing Potential Impact to Production

8

Additional Claim Impacts To Consider

9

Claims processing during the transition period will require monitoring / Dual Processing

Claim history will contain ICD-9 and ICD-10 codes; consider impact

Applications used to look up claims may have to be modified

Staff Training

Update policies, manuals and procedures to accommodate ICD-10

Develop workarounds

Are Providers Coding Correctly?

10

Will provider staff use codes that are most familiar

Consider effect if the incorrect code is utilized

Will providers collect the appropriate information

Challenge of training billers and coders

How will new requirements and documentation be met

Are providers aware of SMA plans to comply with regulation

Vendor Support

11

Application Support Interoperability Programming and Testing Appropriate mapping and crosswalk programming Maintenance and Support

12

Maintain Stability / Manage Change

Key Performance Indicators Accurate and timely payments in a manner consistent with

mandated requirements for contested and uncontested claims. First pass rate is monitored Monitor customer service metrics Action plans in place to effect an increase in electronic;

decrease paper submissions Defined process and evidence of regular oversight / quality

assurance audits for the department Appropriate dispute resolution mechanisms in place Monitor denials vs. paid vs. pend

13

14

CMS Defined Code Sets

Third Party Liability (TPL)

Hysterectomy, Abortion, Sterilization (HAS)

Early Periodic Screening, Diagnosis and Treatment (EPSDT)

15

COB / Third Party Liability

What will be the impact of ICD-10 considering that Medicaid is payer of last resort?

Impact when entity is a non HIPAA compliant entity

When primary entity has processing rules (i.e. services span the compliance date, difference in “from date and through date rules” etc.)

Differences in mapping rules

16`

17

Family Planning

EPSDT – Annual Report CMS 416

18

Report Need CPT Code ICD-9 Code Accompanying

Inclusion 83655 Blood lead test V15.86, V82.5Exclusion 83655 Blood lead test 984(.0-.9), e861.5

Crosswalk of Codes:ICD-9 Code ICD-10 Code

V15.86 Personal history of contact with and (suspected) exposure to lead

Z77.011 Contact with and (suspected) exposure to lead

V82.50 Screening for chemical poisoning and other contamination

Z13.88 Encounter for screening for disorder due to exposure to contaminants

984.0 Toxic effect of inorganic lead compounds T56.0X1AToxic effect of lead and its compounds, accidental (unintentional), initial

E861.5 Accidental poisoning by lead paints No ICD-9-CM code(s) convert to ICD-10-CM E861.5

Introducing Medicaid Information Technology Architecture (MITA) 3.0

19

Operations Management

20

• Price Claim/Value Encounter*• Edit Claim/Encounter*• Audit Claim Encounter*• Apply Mass Adjustment*• Prepare Home Community Based Service (HCBS) payment (if adjudicated in the same

manner as regular claims)*• Prepare COB

Business Processes

• Expand the claims record to store the longer ICD-10 codes• Expand the encounter record to store the longer ICD-10 codes • Expand the claims record to store additional occurrences of ICD-10 codes• Expand the encounter record to store additional occurrences of ICD-10 codes• If utilized, expand the ICD-10 field in the “store and forward repository” • For mainframe environments, may need to utilize filler or expand the copybook layout to

accommodate longer ICD-10 codes • Expand both the claim and encounter record to store qualifiers for ICD-10 and ICD-9-CM

codes

Data Structure Updates

• Update the EDI translator to accept ICD-10 codes on 837I (Inpatient claim), 837P (Professional claim), 837 (Dental claim) claim transactions, also NCPDP claims and prior authorization interfaces

• If utilized, update the interface to write EDI transactions to a store and forward repository• Update the interface between the EDI translator and claims adjudication module to

exchange ICD-10 codes• Update imaging system that scan paper claims

Inbound System Interfaces

High Impact

Operations Management

21

User Interfaces

• Update Claims / Encounter data entry screens to accept ICD-10 codes• Update user applications / look-up screens

• Update X12 Implementation Assistance Handbook edits that use ICD-10 codes• Database that stores a snapshot of the EDI transactions submitted by providers. Some

health plans use these to assist in responding correctly on outbound EDI response transactions to providers.

• Update Medicare Severity (MS) Diagnosis Related Groups (DRG) (e.g., grouper software) for hospital claims and ambulatory payment processes.

• Develop a solution for processing claims/encounters when the dates of service span the compliance date (e.g., instances where the prior authorization spans the compliance date)

• Update any systems processing that uses ICD-9-CM codes in claims adjudication. Possible uses of ICD-10 codes include the following: Automated Medical Review, Manual Medical Review , Pre-Payment and Post Payment Fraud Edits, Claims Grouping, Update Medicaid code editor, Update MS Diagnosis Related Groups (DRG) (grouper software) for hospital claims and ambulatory payment processes, Claims Pricing, Prior Authorization Verification, Benefit Utilization Checking, COB and TPL Identification

• Update MS Diagnosis Related Groups (DRG) (grouper software) for hospital claims and ambulatory payment processes

• Develop a solution for utilizing historical ICD-10 data that precedes the compliance date (e.g., utilization checking)

• Develop a solution for processing claims/encounters when the dates of service span the compliance date

Business Rules and Edits

High Impact

Operations Management

22

• Update edits that identify COB cases during claims processing• Develop a solution for utilizing historical ICD-10 data that precedes the

compliance date• Develop a solution for utilizing / determining mapping or matching of ICD-9-CM

with ICD-10 so that there is correlation between old claims and new claims for the same case and / or episode of illness

• Update the process to support the maintenance of historical data on TPL resource records

• Update the process to identify / flag trauma diagnosis

COB Business Rules and Edits

High Impact

COB Business Rules and Edits

• Update 837 COB transaction to transmit claims to Trading Partners. This includes developing a solution for non-covered entity trading partners (e.g., auto insurance) that still use ICD-9-CM codes.

Operations Management

23

• Update reporting that includes ICD-10 codes. Reports

• Update claims extract for Decision Support System (DSS)• Update the interface between the claims adjudication subsystem and

the EDI Translator to exchange ICD-10 codes.• Update the EDI translator to send 835 claims responses with ICD-10

codes.Outbound System

Interfaces

High Impact

Financial Management

24

• Manage TPL Recovery Business Processes

• Update edits that identify COB cases during claims processing• Develop a solution for utilizing historical ICD-10 data that precedes the compliance date.

Develop a solution for utilizing/determining mapping or matching of ICD-9-CM with ICD-10 so that there is correlation between old claims and new claims for the same case and/or episodes of illness

• Update the process to support the maintenance of historical data on TPL resource records• Update the process to identify/flag trauma diagnosis

Business Rules and Edits

• Update 837 COB transaction to transmit claims to Trading Partners. This includes developing a solution for non-covered entity trading partners (e.g., auto insurance) that still use ICD-9-CM codes.Outbound System

Interfaces

High Impact

25

Impact to Payment

26

DRGs attempt to align actual payment to expected costs by bundling a set of services over a period of time for patients with similar resource intensity and clinical coherence.

Additionally, DRGs attempt to adjust payments for cost factors outside of a provider’s control (e.g. inflation and geographic variation in wage rates)

The assignment of DRGs and determinationof relative payment weight is heavily dependent on inpatient procedures and diagnoses

Diagnosis-Related Groups (DRGs) The Basics

27

DRGs are based on an analysis of historical information and are typically licensed and maintained by an entity who is responsible for their updates and revisions– But there are no historical information yet for ICD-10

In order to create DRGs for ICD-10, maintainers use clinical and/or probabilistic maps (e.g. CMS’ Reimbursement Map) to use historical ICD-9 data for developing ICD-10 groupers

The only ICD-10 grouper that has been publically specified for public review and comparison is the MS-DRG (v26+)

Maintainers attempt to make ICD-10 groupers ‘financially neutral’ but this assumes coding conventions will be similar across two very different code sets

Diagnosis-Related Groups (DRGs) Moving from ICD-9 to ICD-10

M05651 Rheumatoid arthritis of right hip w involvement of other organs/systems

J9610 Chronic respiratory failure, unspec whether hypoxia or hypercapnia

M05651 Rheumatoid arthritis of right hip w involvement of other organs/systems

J9690 Respiratory failure, unspec, unspec whether hypoxia or hypercapnia

28

DRG 469 Major joint replacement

or reattachment of lower extremity w/ MCC weight 3.4724 ($19,390)

ICD-10 procedure: 0SR90JZ – Replacement

of right hip joint w synthetic substitute, open

approach

DRG 470 Major joint replacement or reattachment of lower

extremity w/o MCC weight 2.1039 ($11,748)

ICD-10 procedure: 0SR90JZ – Replacement

of right hip joint w synthetic substitute, open approach

Diagnosis-Related Groups (DRGs) Unintended Consequence

A 50 year old woman with rheumatoid arthritis is admitted for a right total hip replacement. Patient is noted to have respiratory failure as a secondary diagnosis at the time of discharge, but this was not primary reason for hospitalization.

29

Discussion

How are you addressing the manual processes / requests for additional information? – Has that process worked effectively in the past? – Based on discussions at your SMA, the workshop and our

discussions, are changes to that process required as a result of ICD-10 remediation?

How are you addressing claims that you have flagged to pend?

Are there best practices from prior system modifications that you can use during the ICD-10 transition? – Are there practices that you know will not work?

30

To Think About…

Discussion

Questions

31