The ICD-10 transition is no longer just around the corner. The one year delay (which one?) is old news so we have all the planning and implementation taken care of, right?! It’s time to stop waiting for someone else to take the lead on implementation and get into the drivers seat. ORI recommends investing in staff training that does not expire but begins benefiting reimbursement today. Focus on clinic processes, structure, culture and hardwired aspects that need to change whether ICD-10 comes this year or not.
One area to focus is your clinic cash flow and budgets. Budgets can be challenging to do without a team approach, so involve your department leads, vendors and consultants. Asking early for recommendations with non-binding estimates can help focus your priorities and concerns.
Moreover, a solid budget and annual cash flow projections are not only a key component of ICD-10 readiness planning, but an everyday best practice. Administrators of mid-size independent practices are tasked with identifying areas of known and potential cost and a well thought out budget in advance of ICD-10. How many of the budget requirements for ICD-10 are solely for the transition? For example, a budget for ICD-10 coding training can only be useful 6-9 months prior to the transition. However, budgeting for a documentation audit and allocating time to train physicians for more efficient EMR documentation can add to the bottom line today.
What the specific needs are for each practice are and how much the transition will cost is highly dependent on practice size, training requirements, IT and software upgrades. The Medical Group Management Association (MGMA) came out with some estimates that are bound to make any administrator of an independent practice stand up and take notice.
Budgeting needs to include not only money but time. A plan for ICD-10 readiness will require a timeline reviewed by vendors of what each stage will cost in time and dollars. The plan needs to also incorporate flexibility for unplanned costs and delays that may occur. Upgrading software can sometimes wait, but if you are a few versions behind why not go to the ICD-10 ready versions so the learning can be spread out over a longer period of time.
Every budget should include several lines for software and hardware upgrades as well as technical consulting. This begins with your practice management system that acts as a billing and tracking software – a revenue engine for your practice. Having a top performing PM system is more and more important. Having an open PM system that can work with other vendors is also critical. Having the ability to work with your PM vendor to meet your specific needs as a practice and integrate with the other tools you need is a key feature. Also, building on a web based system will allow technical updates on the fly rather than time consuming and challenging updates to your internal network based system. If you are still working with less nimble and expensive “legacy” systems then the costs and timelines could increase. For estimates, look at past performance as a measure of what ICD-10 will cost and how long it will take. Is it just the upgrade or are there usually service fees and hardware upgrades required? If you have not had the ICD-10 conversation and what the costs with be with your PM vendor, you need to do so now.
MGMA provided cost estimates to upgrade or replace PM/EHR for a 10 FTE Practice at $201,690. To upgrade or replace your Practice Management System, the average cost per FTE physician is $10,190 according to the MGMA. For replacement or upgrading of an EHR the average cost per FTE physician is $9,979. These are some hefty amounts and getting your estimates well in advance and including them in your budget will reduce the uncertainty.
Don’t forget your data analytics tools and electronic health records (EHR) systems in your ICD-10 readiness planning. Your EHR will require an upload of all ICD-10 codes required for your practice. There will most likely be upgrades and training for your EHR so be sure to ask enough questions around this topic.
An important element of ICD-10 software upgrades is code search tools. More and more of these tools can be integrated with your PM or EHR system, or are internet based. The costs for some are reasonable at around $1000 a subscription each year. Having this tool live online will also allow learning and updates to occur simultaneously. These tools will help your clinicians be more productive and help select the highest specificity, which will also impact your cash flow.
Don’t forget hardware upgrades on your workstations and internet speeds. October 2015 is not the time to realize that Windows XP is no longer supported and you need to replace 15 workstations. Budgeting a steady upgrade of 1-3 machines every month helps ease the transition and learning curve.
Increased staffing costs should be a part of your ICD-10 readiness planning and budget. You may need to hire additional staff well before the deadline so they are trained in and ready. This may include coders and administrative staff. Increased staff time for management may be invested in project management, meetings with vendors and overall staff readiness.
You will also want to develop a plan and budget for outside consultants. One area is clinical documentation review which is a critical component of ICD-10 readiness. This is both in terms of time and cost. Auditing charts and recommending modifications needs to begin early to be in place by October of next year. Consultants will be in high demand as the deadline approaches and costs could also increase with the demand.
Staff training costs are another area of budgeting to consider. There are many online training tutorials currently available. The best tutorials and training for your staff will vary depending on practice specialty and preferences. Some training is graphically intensive and light on details. Some have a humorous and fun approach while others are “just the facts.” What will work best for your group will depend on your organizational culture and training protocols. Most online trainings run from $500 to $1000 per person. Some training modules are sold per staff member and include individualized tests and feedback. Others can be purchased and provided to the entire practice. Of course, the costs will increased for coding certification or documentation training courses.
Upgrading forms that utilize codes could also be an area of cost to consider. Some practices still rely heavily on a paper superbill or charge ticket. Depending on medical specialty forms could expand significantly if ICD-10 codes are listed. It may also require creating a separate process, such as multiple charge tickets, be created to accommodate the changes.
Perhaps one of the largest budgetary considerations is staff productivity decreases. Fewer patients seen, less coding productivity, billing staff working denials, staff turnover and salary increases, staff overtime, hiring costs, etc. The impact of ICD-10 on claims payment is a big unknown for many practices at this time. Having contingency plans such as setting aside cash reserves or delaying a large capital investment could be a wise move. It is recommended to have 3 months of reserves for financial commitments to staff and vendors in the event of significant increases in denied or pended claims.
As with any budget, it won’t be perfect the first time through. But getting started on ICD-10 readiness now and continuing to adjust is a great strategy. Another strategy is getting an outside perspective from Outsource Receivables on your practice. Visit ORI’s ICD-10Readiness to request your complimentary assessment.