Healthcare IT Scrambling to Implement New Medical Code Systems

23 Jan

A new medical coding system is mandated for October 1, 2015. New medical record requirements already have healthcare IT departments scrambling to update systems and procedures. Now, with the new coding system set to replace the old one, IT departments have even more in their plate.

At the surface, a new medical coding system sounds great. Sure, who wouldn’t want an easy, standard way to identify diagnoses and to submit claims to insurance companies? In the end it should make things easier for everyone involved. Well, the ease that the new systems hope to provide is further complicating things for healthcare IT departments, and costing millions of dollars in the process.

The deadline for the mandate has already been delayed twice due to the complexity of the new codes and the lack of readiness from healthcare institutions throughout the country. But why is it taking so long, what’s the problem? One of the main issues is the amount of new codes that will be implemented. The current code standard, known as ICD-9, uses about 14,000 medical codes. The new standard, known as ICD-10, will have nearly 65,000. Implementing 50,000 new codes is certainly not an easy task.

Adding to the complexity is the fact that insurance companies will be using the coding system to settle claims. If a code is wrong, mistyped, or omitted by the system, whether by user error or system error, it could mean physicians and hospital systems lose out on money from claims. Furthermore, the old coding system only required numeric codes, which is now being switched to alphanumeric. So, in essence, everything about the system is changing, and medical systems around the country need to be in compliance by the date mandated.

There are many operations or applications that may need to be changed in order to comply. For instance, if the billing department uses some sort of automated billing system, the new codes will need to implemented into this system. This also means growing your database capabilities quite a bit. Not only will databases fields need to be increased, but the size of the fields as well.

Of course, the system is meant to do a lot of good and to hopefully save time and money while creating a standard. However, the costs of upgrades to comply are in the millions of dollars. Several insurance companies including United have spent over $100M in systems upgrades. Hospital systems may need to boost resources in order to manage and keep up with the coding process. Currently, there are under 200,000 medical coders working in the U.S. With the number of codes growing by about 400% one must believe that more resources will be needed to handle the growing list. Not only that, but the costs of upgrading systems for private physician practices could prove daunting and expensive. Many physician practices don’t have nearly as robust a system as hospitals do, and upgrading to systems that can handle the new codes is proving difficult.

It’s currently estimated that only about 10% of providers and payers have completed testing their systems with the new codes. Given these are only a few short months left to do so is proving worrisome for many. Should these providers or payers not comply by the mandate it could mean significant delays for healthcare transactions leading to financial disorder and ultimately less access to healthcare for citizens.

Sometimes you need to completely overhaul something. Tear down the walls and start a new. But at what cost? Surely we’ll see the benefits of these upgrades and standards down the road, but hopefully it won’t disrupt an important part of every day life for many people around the country.