HHS Proposes ICD-10 Code Sets

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Law - October 2008

Tex Med . 2008;104(10):32-33.

By  Crystal Conde
Associate Editor

The Department of Health and Human Services (HHS) has announced a proposed regulation to replace the ICD-9-CM code sets now used to report health care diagnoses and procedures with expanded ICD-10 code sets, effective Oct. 1, 2011.

In a separate proposed regulation, HHS has proposed adopting the updated X12 standard, Version 5010, and the National Council for Prescription Drug Programs standard, Version D.0, for electronic transactions, such as health care claims.

"We are taking a giant step forward toward developing a health care system that focuses on quality and affordability through the implementation of health information technology," HHS Secretary Mike Leavitt said. "Conversion to ICD-10 is essential to development of a nationwide electronic health information environment, and the updated X12 transaction standards are a critical step in the implementation of these new codes."

In 2000, under authority provided by the Health Insurance Portability and Accountability Act of 1996 (HIPAA), the ICD-9-CM code sets were adopted for use in the administrative transactions by the public and private sectors to report diagnoses and inpatient hospital procedures. Covered entities required to use the ICD-9-CM code sets include health plans, health care clearinghouses, and health care providers who transmit any electronic health information in connection with a transaction for which a standard has been adopted by HHS.

Developed almost 30 years ago, ICD-9 is now widely viewed as outdated because of its limited ability to accommodate new procedures and diagnoses. ICD-9 contains only 17,000 codes and is expected to start running out of available codes next year.

By contrast, the ICD-10 code sets contain more than 155,000 codes and accommodate a host of new diagnoses and procedures. The additional codes will help enable the implementation of electronic medical records because they will provide more detail in the electronic transactions. This granularity will also help to improve efficiencies by helping to identify specific health conditions.

"Now is the right time to move forward with the transition from ICD-9 to ICD-10," said CMS Acting Administrator Kerry Weems. "We recognize that the transition to ICD-10 will require some upfront costs …. We will continue to work collaboratively across the health care system to ensure a smooth transition to use of the updated transaction standards and ICD-10."

Updated versions of current HIPAA electronic transaction standards require the use of the ICD-10 code sets for claims, remittance advice, eligibility inquiries, referral authorization, and other widely used transactions. Under the updated transaction standards proposed rule, compliance with Version 5010 (health care transactions) and Version D.0 (pharmacy claims) would be required by April 1, 2010.

Both regulations may be viewed at  www.cms.hhs.gov . Comments on the ICD-10 code sets proposed rule and on the proposed updated transaction standards are due by Oct. 21, 2008.

The HHS announcement drew opposition from the Medical Group Management Association (MGMA). It said it supports the move to ICD-10 codes, but is "extremely disappointed" that Oct. 1, 2011, was chosen as the implementation date.

"The proposed regulation simply does not give the industry the time necessary to implement ICD-10," said William F. Jessee, MD, MGMA president and chief executive officer. He said federal officials should wait at least three years after the conversion to X12 standard, Version 5010, before moving to ICD-10.

Because ICD-10 contains 10 times the number of codes as ICD-9, the newer code set will require vast changes for medical groups, hospitals, and other health care facilities.

ICD-10 will have considerable impact on clinical documentation, administrative transactions, and quality-improvement programs, MGMA said. It cited research by its Legislative and Executive Advocacy Response Network (LEARN) that indicated 95 percent of respondents in medical practices would have to purchase software upgrades for their practice management systems or buy new software.

 In addition, 63.5 percent concluded that they would have to purchase code-selection software. And, 83.5 percent of LEARN respondents do not think public and private health plans would be ready to accept claims with ICD-10 codes by October 2011.



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