Physician Groups Urge CMS to Develop Contingencies for Potential ICD-10 Failures

Stay ahead of developments in federal and state health care law, regulation and transactions with timely, expert news and analysis.

By James Swann

March 4 — One hundred physician organizations, including the American Medical Association, said the Centers for Medicare & Medicaid Services should release detailed results from recent end-to-end testing for the ICD-10 transition and prepare contingency plans for claims processing disruptions that could result from the coding change, according to a letter released March 4.

The doctor groups said the CMS completed a week of ICD-10 testing in January and reported a claims acceptance rate of 81 percent based on limited data. That is below the average acceptance rate of 95 to 98 percent for Medicare claims, they said.

“The likelihood that Medicare will reject nearly one in five of the millions of claims that go through our complex health care system each day represents an intolerable and unnecessary disruption to physician practices,” AMA President Robert M. Wah said in the letter. “Robust contingency plans must be ready on day one of the ICD-10 switchover to save precious health care dollars and reduce unnecessary administrative tasks that take valuable time and resources away from patient care.”

In a Feb. 25 blog post, CMS Administrator Marilyn Tavenner described the first round of testing in January as successful, saying 660 providers submitted 15,000 test claims using the new, expanded ICD-10 (International Classification of Diseases, 10th Revision) code set. She said some claims were rejected, but that most were due to errors unrelated to ICD-9 or ICD-10 coding.

However, the physician groups said the claims acceptance rate was troublesome.

“Accordingly, we strongly urge CMS to release more detailed end-to-end testing results broken out by the type and size of providers who tested, number of claims tested by each submitter, percentage of claims successfully processed, and specific details about problems encountered,” the letter said.

The International Classification of Diseases is a standardized coding system used by providers for identifying illnesses and treatments, as well as for reimbursement. ICD-10 updates health-care diagnoses and procedure codes from the currently used 13,000 in ICD-9 to 68,000, and will be required for all Health Insurance Portability and Accountability Act covered entities.

In August 2014, the CMS published a final rule designating Oct. 1, 2015, as the implementation date.

Contingency Plans

As for contingency plans, the physician groups said previous health-care infrastructure upgrades such as the adoption of the national provider identifier (NPI) and the switch to Version 5010 transaction standards have led to “significant claims processing disruptions that caused physicians to go unpaid for weeks and sometimes months.”

The transition to ICD-10 is expected to be more complex than either the NPI adoption or the switch to Version 5010, and the CMS should grant “advance payments (which are nothing more than reimbursement outside of the normal claims processing system for services already rendered, such as paper checks) to physicians experiencing a dire financial hardship as a result of the change to ICD-10, particularly if the issue originates on Medicare’s end,” the letter said.

The letter also said that while physicians are required to use certified electronic health records under the meaningful use program or face penalties, many software vendors haven't upgraded EHRs to handle ICD-10 codes.

The CMS and the Office of the National Coordinator for Health Information Technology should review this issue and release data on vendor readiness, the letter said.

Quality Measurement

Another area of concern for providers is how the use of ICD-10 will impact the ability to collect and measure quality data, the letter said.

For example, quality data collection under the Physician Quality Reporting System (PQRS) and the meaningful use program will collect both ICD-9 and ICD-10 data, and “CMS has not discussed how it plans to address and correctly tabulate quality performance reporting metrics after the transition to ICD-10,” the letter said.

Additionally, the Value Based Modifier program will include ICD-9 and ICD-10 codes, which will cause a variation in calculations.

Accordingly, the CMS should “provide details on how it plans to ensure that the measure calculations for these programs are not adversely impacted by the transition to ICD-10,” the letter said.

To contact the reporter on this story: James Swann in Washington at

To contact the editor responsible for this story: Kendra Casey Plank at

The physician letter is at


Request Health Care on Bloomberg Law