U.S. Health-Care System Upgrade Represents One of the Biggest Modernization Efforts in Industry History

In massive IT transition, states have less than four years to upgrade disease diagnosis code sets.

by / January 21, 2010
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They say it's a bigger deal than the Y2K bug. Not so much in terms of mass hysteria, but in scope.

In 2013, the U.S. will upgrade to the latest version of the International Classification of Diseases (ICD) system -- the standard diagnostic taxonomy by the World Health Organization -- a move which represents "the largest health-care systems modernization effort in history," said Bartlett Cleland, senior director of policy at TechAmerica, a technology industry association.

As hospitals switch to the latest disease diagnosis and procedure codes, industry observers say, the technical and economic impact to the U.S. government and health-care community could eclipse the much-hyped system upgrades at the turn of the century.

"It's going to affect anybody who touches the health-care system," Cleland said. "If not done correctly, this change has the potential to be even more painful than anything in the health-care debate that's going on."

For decades, U.S. medical organizations have been using ICD-9, the ninth revision of the code sets. But ICD-9, developed in the 1970s, has been showing its age: With less than 20,000 codes, the system struggles to accommodate modern medical practices and new technology. The latest version, ICD-10, offers more than 155,000 different codes, reflecting advances in disease detection, genetic research and connecting the country to a global medical communication network.

For many on the state and local level, the process of upgrading an entire system is a real pain. But they have no choice; the deadline for compliance is Oct. 1, 2013. As a prerequisite, these organizations must also implement the Health Insurance Portability and Accountability Act (HIPAA) 5010 electronic transactions standards by Jan. 1, 2012.

A Painful Procedure

In the global ICD-10 adoption race, the United States could use a booster shot. The 10th revision of the code sets were completed in the early 1990s. About 100 other countries such as the United Kingdom, Sweden and Canada have already introduced respective editions of ICD-10.

Of course, the U.S. health-care system is complicated. But with the constraints of ICD-9, the United States cannot as easily compare health service records with other countries.

Take asthma, for example. ICD-9 has two ways to classify asthma: intrinsic and extrinsic. But ICD-10 classifies asthma as mild, moderate and severe. With a system that more specifically diagnoses diseases, patients can receive more accurate treatments and physicians can better compare data for clinical, research and payment purposes.

Unfortunately no software exists that can precisely upgrade ICD-9 codes with the click of a button, which means the transition will require a "massive wave of system reviews, new medical coding or extensive updates to existing software, and changes to many system interfaces," according to ICD-10: Turning Regulatory Compliance into Strategic Advantage, a paper from the Deloitte Center for Health Solutions, part of Deloitte.

ICD-10 is divided into two major parts: ICD-10-CM classifies diseases; ICD-10-PCS contains procedure codes. The paper states that, "Because of the complex structure of ICD-10 codes, implementing and testing the changes in [electronic medical records], billing systems, reporting packages, decision and analytical systems will require more effort than simply testing data fields -- it will involve installing new code sets, training coders, remapping interfaces and re-creating reports/extracts used by all constituents who access diagnosis codes."

The move will affect providers, health plans, claims clearinghouses, technology vendors and more, and Deloitte notes that it has the potential to spur innovation and produce a gigantic wave of IT spending.

This transition comes in addition to the recent push for hospitals to increase use of electronic health records (EHRs) systems from 10 percent in 2009 to 55 percent by 2014. But a survey released this month by Computer Sciences Corporation (CSC) reveals that "U.S. hospitals are only halfway to qualifying for government incentive payments aimed at controlling health-care costs while improving the quality and effective delivery of patient care." The CSC report also shows that only two-thirds of hospitals have taken the first step: identifying system gaps to meet the requirements for meaningful use.

A Planning Process

The Medical Group Management Association estimates that the average cost of upgrading to ICD-10 for a three-physician practice will be $84,000.

To make the transition easier for states, the Centers for Medicare and Medicaid Services (CMS) developed an ICD-10 training package, which includes 12 training segments to assist with implementation.

For instance, CMS recommends that states conduct a business and technical assessment of the entire agency before anything else. It also examines the benefits of ICD-10 and emphasizes the value of creating a team of trained experts to lead strategy and project teams. In addition, experts say, looking at the system transition solely as an IT issue will not work.

"You have to approach it from a statewide perspective," said Brian Erdahl, Deloitte's principal in the public-sector practice and leader of the state health IT practice. "Not just the technical impacts, but also the business impacts. If you don't look at it broadly enough, it will cost you significant heartburn down the road."

Even though the United States is years behind other countries in adopting ICD-10, Cleland said, the delay gave industry analysts time to see what practices did or didn't work rather than leaping blindly.

"At the end of the day, it obviously affects the patients," Cleland said, "and we don't want them to be the guinea pigs."

A Patient Priority

The biggest difference between ICD-10 transition and Y2K, Cleland said, is that nobody seems to be talking about ICD-10.

He attributes that mostly to a lack of public awareness, even though "it affects something intimate and private to all of us," he said. Pushing back the deadline, he added, won't help industry professionals make it a priority.

TechAmerica has been working to help spread knowledge and lend support as "a clearinghouse for ICD-10 information as it relates to the technology industry." In publicizing ICD-10 transition, Cleland said, the group tries to find a balance between stressing its importance while minimizing fear.

"Y2K had the potential to be a disaster and it wasn't," Cleland said. "We don't want a Y2K-esque fear around this. We just want it to work."


Russell Nichols Staff Writer
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