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Health

New Medical Billing System: So Far, So Good

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Health care providers across the country have been fearing the switch to a complicated new coding and billing system. Some were predicting an apocalyptic snarl of red tape. But when Heartland Health Monitor’s Bryan Thompson checked in with some Kansas providers about how things have gone the first month, they said “so far, so good.”

The new billing system is called ICD-10. It's the tenth version of the World Health Organization's International Classification of Diseases. That's where the initials, ICD, come from.

It replaced a system that had been in use since 1979. The new system has far more codes than the old one—100,000 more. It’s meant to be more specific about diagnosis and treatment, not only for billing purposes, but for medical research, evaluating treatments and procedures, and tracking disease outbreaks, too.

But health care providers were worried that they might choose the wrong codes, and might not get paid by insurance companies—at least not promptly—as a result. So, after a little more than a month, how’s it going?

"Surprisingly well," says Barbie Hays, who is in charge of medical coding for the American Academy of Family Physicians.

“There was a lot of talk that this was going to be a disaster, but I think that they have found that it’s not as horrible as they were thinking it was going to be. It’s not as expensive as what they thought it was going to be," she says. "The world didn’t stop like they thought it was going to for Y2K.”

You remember Y2K: The fear that computers worldwide would crash on the first day of the year 2000. Well that first day of the new century turned out to be pretty much business as usual. Hays says her conversations with her members and medical coding specialists indicate the same is true for the conversion to ICD-10. She says that’s important, because payment delays could have been a big problem.

“So if you’re not receiving money within 21 days, they may not be able to make that paycheck for that nurse or that receptionist that’s working for them at 30 days," she says.

Hays says there have been a few problems, but they’ve been quickly resolved. If there were any major difficulties in Kansas, the state’s largest insurance company, Blue Cross Blue Shield of Kansas, would probably be among the first to know about them. Spokeswoman Mary Beth Chambers says the company processes between 50,000 and 70,000 claims every day.

“Nearly 80 percent of our claims are processed entirely electronically, and if there are errors it will kick a claim out of the system to have one of our claims processors look at it more closely," Chambers says. "But we have not had an uptick in claims that have been kicked out because of ICD-10."

Chambers says Blue Cross has been working with health care providers around Kansas for the last three years to help them prepare for the new coding system. It was initially scheduled to go live two years ago, but it was delayed—first by the Obama Administration, and then by Congress. That may be one reason implementation has gone as smoothly as it has. The industry may not be out of the woods just yet, though, according to Brock Slabach of the National Rural Health Association.

“By the time the claims are submitted to the third party payers, and then they go through the process of claims processing, the issues of cash flow won’t be seen typically until about 45 days or more," Slabach says.

That means it may be mid-to-late November before health care providers can truly breathe a sigh of relief. Slabach says the reports from Blue Cross Blue Shield of Kansas and the American Academy of Family Physicians would seem to indicate, however, that the worst fears about the new medical coding system will not be realized.