Reprieve on ICD-10

Two weeks into the new year, the Centers for Medicare & Medicaid Services announced new policies that offer a mixed medical bag to physicians.

Clearly good news is that doctors got the critical delay they sought for implementation of the new set of International Classification of Disease codes -- an important victory for the AMA and other groups that called for more time. However, of concern to knowledgeable observers are well-intentioned rules that end Medicare pay for three kinds of surgical errors.

Far and away, the change with the broadest impact will be the new deadline for implementing the ICD-10 code sets. It had been scheduled for Oct. 1, 2011. Now it's going to be Oct. 1, 2013, a two-year reprieve that is welcome news to physician organizations who said they needed the additional time for physician education, coder training and software vendor updates.

An Oct. 21, 2008, letter from the AMA and numerous other groups called for a revised timeline that allowed for a smooth transition from the ICD-9 coding system of about 16,000 procedure and diagnosis codes to the new system of 155,000 such codes. The organizations said the training and costs for moving to the complex coding system were underestimated by CMS, and they feared a chaotic transition unless more time was granted.

CMS received more than 3,000 comments on the proposed ICD-10 rule and listened to concerns from the medical community. Besides extending the ICD-10 deadline, CMS also delayed until Jan. 1, 2012, the deadline for doctors to adopt the 5010 electronic transaction standards under the Health Insurance Portability and Accountability Act.

Both rules, issued during the final days of the Bush administration, are under review by the Obama White House. Physicians have reason to be hopeful that the new president will agree that the compliance delays were the right move and will avoid proposing any new rule that rolls them back.

CMS did the right thing by heeding time, cost and implementation concerns voiced by physicians and others. The AMA has said that the ICD-10 and 5010 delays are reasonable, and the extra time will help doctors better prepare for the transition.

In addition to announcing the ICD-10 delay on Jan. 15, CMS issued three national coverage determinations, effective immediately and not subject to the same review as the coding reprieve, that end Medicare pay for three preventable surgical errors. The errors are surgery on the wrong body part, surgery on the wrong patient and wrong surgery performed. CMS said policies on these "never events" can decrease causes of serious illness or deaths and reduce unnecessary costs to Medicare.

Physicians would be the first to agree that such errors should not happen. But this aspect of never events turns on the question of how the vast Medicare bureaucracy enforces its policy.

In a Jan. 1 letter, the AMA said that CMS should not use the NCD process to address these three procedures. The Association said CMS should instead develop a clear payment policy that details specific circumstances when Medicare would not pay surgery claims rather than a blanket ban on pay under broad error categories.

The AMA also said there should be an appeals process for physicians and hospitals for inappropriately denied claims. There also are worries about Medicare claims processing workers not having the expertise to determine which surgeries were performed correctly.

In the case of the massive ICD-10 transition, CMS rightly made an adjustment when it was clear that organizations weren't fully prepared to process the change. Unfortunately, CMS did not apply that same flexibility in light of reasonable concerns about how Medicare will enforce its payment rule on never events.