Benefits of ICD-10

Benefits of ICD-10: The Case for Change
by Lawrence Pawola, PharmD, M.B.A.
Director of the Department of Biomedical and Health Information Sciences,
University of Illinois, Chicago; Board of Directors, Phoenix Health Systems

Why Move to ICD-10?
During the past few years, I have been asked on a number of occasions why the transition from
ICD-9 to ICD-10 is so important, what is to be gained from the transition, and why now,
particularly given the anticipated work to affect the transition and the general thought process
that it is another government intrusion akin to Meaningful Use, among others?
As prelude to my response, I will point to the independent study by the Rand Corporation (1)
concluding the benefits of the ICD-10 transition will outweigh the implementation costs
within a short time for most organizations, but the cost of doing nothing may be far greater
than the cost of the work to complete the transition. As healthcare becomes increasingly
more electronic and the costs of any future change will most certainly involve more complex
systems, any further delay in the transition will only become more expensive.
If ICD-9 has served the industry so well for so long, why change now? Simply stated, ICD-9 has
not been able to keep up with modern medicine and the advances in medical technologies.
The old coding system is exhausted.
2Benefits of ICD-10www.PhoenixHealth.com
“The cost of doing nothing may be far
greater than the cost of the work to
complete the transition.”

Since the United States is the only industrialized nation in the world not utilizing
ICD-10 or a similarly detailed coding scheme, we are having an increasingly difficult
time accurately measuring the quality of care provided in our healthcare system. It
is becoming more costly and complicated to adequately assess a patient’s condition
and evaluate treatment outcomes when we don’t have the availability of a clear-
cut and well-defined coding system.
Perhaps even more important is our duty as medical workers to continually
improve the quality of care we deliver to our patients, to reduce our errors, and to
enhance our decision-making with more accurate data available at our finger tips.
Add the opportunities of using improved and more defined data for research
purposes and more quickly defining fraud and abuse cases, one can readily see why
ICD-10 or a similarly detailed coding scheme is prevalent throughout the world.
If our healthcare delivery system is so good, and we in the United States like to
think we are the best in the world, then why are we resisting this change? Is it
because we don’t understand the benefits of the transition? Or are we looking at
ICD-10 as a checkbox on an ever growing "to do" list rather than a strategic
opportunity for our organization?
This is not a new
revelation.
The inadequacies of ICD-9
were widely recognized
over 20 years ago when The
National Committee on
Vital and Health Statistics
(NCVHS) testified to the
Department of Health and
Human Services (HSS) the
difficulties of ICD-9 in
keeping up with the rapid
pace of advances in medical
science.
Why has it taken so long?
www.PhoenixHealth.com Benefits of ICD-10 3
Why ICD-9 Falls Short

The Basics.
The diagnosis side for ICD-9-CM (Clinical Modification) has about 13,000 codes
compared to 68,000 codes for ICD-10-CM.
A big chunk of this expansion is due to the increased specificity in the ICD-10-CM coding
scheme. There are codes, for example, for right eye, left eye, bilateral eyes and
unspecified whereas in ICD-9-CM these are all in one code.
For the procedure side, there are about 3,000 volume 3 ICD-9-CM codes; in ICD-
10-PCS (Procedure Code System), there is a potential of about 72,000 codes.

Simply stated…
More codes means more defined, and better, differentiation of procedures to more
accurately document technology advancements.
This has become a most noteworthy problem in many medical specialties where new
procedures, technologies, devices, and treatments are being used; many ICD-9 categories
don’t have any additional room for more codes. Just ask the HIM professionals to discuss
the difficulties they have accurately coding recently introduced and more advanced
orthopedic and cardiovascular procedures, among others.
The new ICD-10 codes should then translate directly into:
• More precise reimbursements
• Improved reporting
• More detailed outcome data for the providers
• Fewer claim rejections or requests for additional data
• Diminished need for manual reviews of records in order to meet the information
demands of reporting agencies.
For the payer, this means more accurate and detailed medical coverage while providing
better management of reimbursements to the patient.

The Case for Better Data
Because of increased levels of detail and accommodation of new procedures and technologies, ICD-
10 can supply better data to measure and assess the quality of care delivered to our patients.
As clinicians, we will be
better able to understand
adverse events and
complications which will
assist in identifying
treatments to improve our
patients’ outcomes.
Our ability to mine data
for further analysis and
identification of trends
while promoting safety
and other best practices
will be improved.
The new codes will further connect a provider’s performance to the patient’s overall
condition and outcome; the resulting impact on malpractice and insurance rates at both the
personal and organizational levels may be unprecedented.
Accurate and comprehensive procedure codes will upgrade the data available to determine
outcomes, treatment efficacy, and overall costs incurred from using new medical technologies.
In its purest form, these will lead to better care being provided as well as more thoroughly
identifying and monitoring patients in need of additional interventions or disease
management programs.

An often overlooked aspect of the ICD-10 transition is the opportunity
for comparing care and best practices because of a more granular
standard of data capture being utilized.
This benefit alone will better support
the medical community’s thrusts to
improve performance and contain costs.
All providers will now be able to better
monitor resource use, analyze healthcare
costs at a greater level of detail, and
monitor outcomes relative to overall costs.

Public Health Benefits
In this era of increased awareness, and because the United States has not been
using ICD-10 or a similarly detailed coding system, we cannot very easily share
disease data internationally.
For public health reasons, such sharing is essential to
adequately respond to emerging global threats.
Public health emergencies must be communicated to local agencies and
internationally to the World Health Organization (WHO) in order to rapidly
detect, verify, and respond in an appropriate manner to threats so any impact is
minimized.
Generally speaking, ICD-10 is more valuable documenting public health clinical
data than other coding schemes; its specificity captures more reportable public
health diseases, particularly those related to substantial mortality and
bioterrorism (2).

Improvements in Research
Because of the finer detail contained in ICD-10, fewer coding errors will be
realized which will improve the data available for research purposes.
The greater detail will provide researchers with more opportunities to uncover
formerly unidentified data relationships. For instance, knowing if one less
invasive procedure has similar or better results at a lower cost than another
more extensive procedure would greatly affect the quality of care in our country
while potentially saving a considerable amount of money.
Further, better coding classifications for injury severity, mortality risk, and
other population-based data is essential for outcome research in addition to
identifying better prevention and treatment follow-up programs.

Summary
The transition to ICD-10 represents an improved mechanism to record the care
delivered to our patients consistent with the opportunities afforded to our industry
from the implementation of more extensive and better clinical technologies. The cost
of not transitioning to ICD-10 could be staggering, not to mention the cost of lost
payments and opportunity.
The data available from the use of ICD-10 will dramatically advance our
nation’s healthcare system in a number of critical ways while delivering the
benefits identified above while reducing the risks of fraudulent reporting.
The transition to ICD-10 must be viewed more broadly than merely complying with
another government regulation; rather, it is an opportunity to differentiate and
strategically use the data to create greater value for our society in terms of higher
quality and reduced costs. In that is the true benefit why the transition to ICD-10 is
important for everyone.

Appendix
(1) Rand Corporation. “The Costs and Benefits of Moving to the ICD-10
Code Sets.” March 2004. Available online at
http://www.rand.org/content/dam/rand/pubs/technical_reports/2004/
RAND_TR132.pdf.
(2) Watzlaf V., et. al. “The Effectiveness of ICD-10-CM in Capturing Public
Health Diseases.” Perspectives in Health Information Management,
volume 4 number 6 (2007). Available online at
http://www.citeulike.org/user/stuffbyjess/article/9119121.
Need help with your
transition to ICD-10?
Contact us!Phoenix Health Systems, Inc.
1130 East Arapaho Rd, Suite 500
Richardson, TX 75081
ph: (214) 261.0660
contact@phoenixhealth.com

Benefits of ICD-10

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Benefits of ICD-10