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The projected debut of the Comprehensive Care for Joint Replacement (CCJR) Model is less than three months away, and it represents an entirely new approach for care and cost management. Affected hospitals are beginning to realize that the financial, operational and clinical risk they are responsible for managing is a much larger task than they had originally envisaged.
When the Centers for Medicaid & Medicare Services (CMS) first proposed the program, CMS wanted to demonstrate a new way to achieve better care, smarter spending, together with healthier people and communities through coordination of care across inpatient and outpatient healthcare providers. Hospitals are realizing their internal resources are not well-aligned with the requirements for analyzing and administering a CCJR program.
What is the risk hospitals must manage?
A large proportion of services included in a CCJR episode are non-hospital based. In terms of actual cost, CMS estimates that these non-hospital services account for 45% of the total cost for a lower extremity joint replacement (LEJR) procedure.
During the first year of the program, hospitals will not have to reimburse CMS when total costs exceed the aggregate targeted amount for the LEJR. However, in Year 2 a reconciliation payment back to Medicare, capped at 10% of the aggregate target price, will be required for instances where payment exceeded targeted cost. This requirement would grow in years 3-5 to a cap of 20%. The program does allow for gain-sharing that beginning in Year 1, but most organizations are initially looking at risk rather than gain-sharing given the negative impact this could have for their bottom line.
The financial implications may be significant. Let’s take the example of a hospital that performs 150 LEJR annual procedures at an aggregate target price of $25,000 per case. The total episode amount would be $3,700,000, and as shown in Figure 1, the upside/downside amounts can greatly affect a hospital’s bottom line:
Is your hospital ready for CCJR?
CCJR places the burden of responsibility clearly upon the hospital to manage the totality of care, cost and quality for 90 days following discharge. Every hospital understands the processes that influence cost, quality and outcomes within its walls. However, looking at these same factors for non-hospital providers is, with rare exception, an exercise most hospitals would consider a trip into uncharted waters.
Allscripts consultants understand the complicated nature of episode-based bundled payments and can conduct a readiness assessment specifically tailored to the CCJR model. Understanding risk points across the entire episode of care will help hospitals identify opportunities to reduce variations in care, reduce cost and optimize patient outcomes through care coordination with post-acute partners.
If you would like to discuss how CCJR will impact your hospital and what you can do now to ready your organization for January, please contact us.
Editor’s Note: Matt Fusan, Allscripts Strategic Sales Consultant, contributed to the content of this blog post.
For most healthcare providers, October 1, 2015 did not signal falling leaves and cooler temperatures. They were focused on ICD-10, a reality which will significantly affect hospitals and physician practices now and well into the future.
For those getting a late start
At a recent assessment, I asked if the organization had educated staff, worked with vendors to verify, install and test ICD-10 upgrades, audited ICD-10 coding for accuracy, and sent test data from their billing system to their clearing house for payment testing. I also asked if there was any consideration for delegation of responsibilities to managers who would know best how to address these concerns. Unfortunately, even though the deadline was looming, each question was answered with “No.”
Allscripts conducted a comprehensive onsite survey to identify key ICD-10 readiness deficiencies and, from this, developed a prioritized remediation program. With very limited time remaining until October 1, the plan addressed what the organization should do immediately and what it could address after ICD-10 started.
Even now that the deadline is upon us, the priority areas and associated actions for organizations remain the same:
1.Education: Use a dual education approach, including both classroom and online training with the latter primarily for the medical staff. For an online tool, Allscripts Experiential Learning program enables users to access the lessons when it best suits their availability and provides feedback to the leadership of who took which lessons and individual scores upon completion of the lesson.
2. IT Readiness: IT must validate all installed software products to meet ICD-10 standards, test relevant interfaces and establish a timetable with defined completion goals. In addition, IT should be responsible for establishing ICD-10 testing schedules through the billing clearinghouse with the organization’s top three payers.
3. Coding: In the organization above, coding is outsourced and this same company also managed all Clinical Documentation Improvement (CDI) queries to the medical staff. Finance took the lead in requiring this company to conduct an outside quality audit for coding accuracy and CDI statistics, and has requested more frequent reporting on high value-high frequency diagnoses by departments and providers.
4. Documentation: With the wide degree of variability in documentation noted across providers, locating and identifying key diagnostic information is a difficult task. Allscripts provides templates that combine a structured note with the ability to enter free text for additional details. Another helpful tool is Allscripts Health Issues Manager (HIM), which enables the provider to quickly select the most appropriate ICD-10 code and build the patient’s problem list.
While these four action items cover a wide scope of the critical tasks needed for ICD-10, organizations must continue to address these areas and others, such as provider communication and data exchange across different systems. Even with a late start in preparing for ICD-10, organizations can still have a realistic plan that focuses on the immediate essentials for ICD-10 together with a long-term strategy for maintaining ICD-10 compliance.
Looking beyond October 1
The Centers for Medicare & Medicaid Services (CMS) has announced a number of initiatives and programs that rely on the same level of detailed documentation required by ICD-10, such as Value-Based Care, Bundled Payments, Episodes of Care (including the Comprehensive Care for Joint Replacement (CCJR) program scheduled to begin in January 2016) and Pay for Outcomes. These initiatives collectively reflect the intent of CMS, and eventually other payers, to migrate away from a service-based payment model to one that looks at cost containment, outcomes and quality as the basis for payment.
Ready or not, ICD-10 is here. Even if you have not yet addressed the four critical issues – education, IT readiness, coding and documentation – all is not lost. Allscripts can help you quickly get on track to minimize denials and reimbursement delays and set your organization up for long-term success.
In July 2015 the Centers for Medicare & Medicaid Services (CMS) announced the proposed CCJR program, a five-year initiative for addressing bundled inpatient and outpatient payments for patients who have lower-extremity joint replacement surgeries.
Perhaps the most important aspect is the endpoint for the episode of care, which is 90 days after discharge. During this period CMS will pay all providers, inpatient and outpatient, using the current fee-for-service model. However, the proposed rules would hold the hospital accountable for the cost of services (both inpatient and outpatient) relating to the patient’s procedure and post-surgical care.
This new risk/reward arrangement presents significant financial implications for the hospital. If a hospital can control costs and demonstrate quality during both the hospitalization and post discharge, then it can receive a bonus payment. Conversely, if the aggregate cost of care during the 90-day window exceeds the targeted amount, then the hospital must pay the difference back to CMS.
The rationale behind CCJR
According to recent reports, hip and knee replacement surgeries account for more than 400,000 procedures annually and total costs exceed $7 billion. CMS reports the average Medicare expenditure for hip and knee surgery, hospitalization and recovery ranges from $16,500 to $33,000 across geographic areas. Equally disconcerting are reports that complication rates for equipment failure and infection can vary by as much 300% across facilities.
It is understandable that in an age of “pay for outcomes,” a hospital that can control costs and at the same time demonstrate better quality than the competition should be rewarded.
To adjust for regional variables, CMS is developing a target reimbursement price for each of the 75 Metropolitan Statistical Areas (MSAs) for knee and hip replacement procedures. This mandatory, bundled payment concept is a major step in CMS’s goal to move to a 50% value-based payment model by 2018. Looking forward, the industry should anticipate more bundled payment initiatives that hold hospitals accountable for total cost and quality of care.
What CCJR means for hospitals
The 90-day comment period for CCJR closed September 8. CMS will now review feedback and deliver the final framework of the proposal. However, it is likely that CCJR will begin as scheduled in January 2016. Over the fourth quarter of 2015, hospitals must define new levels of business relationships across their provider networks that encompass both risk and potential gain sharing initiatives, and develop innovative ways to maximize quality while minimizing cost.
In my next blog, we will discuss the best practices hospitals need to implement to prepare for CCJR. Until then, if you have questions about CCJR or how Allscripts can help you develop a solution tailored to you, contact us.
Editor’s Note: Matt Fusan, Allscripts Strategic Sales Consultant, contributed to the content of this blog post.
User documentation, education and governance remain the top three issues threatening ICD-10 readiness. But another, equally disturbing practice is emerging. Many hospitals and practices have opted to let coding staff select ICD-10 codes based upon physician documentation, placing key decisions in the hands of the coders instead of clinicians.
In a recent Healthcare Informatics article, Dr. John Elion noted that certain ICD-10 PCS (procedure coding system) codes require a great degree of detail and granularity. The physician must explicitly detail a procedure and the circumstances associated with the event so that there is no ambiguity as to the correct code.
The real concern is not missing information, it is that the physician’s description is not formatted to meet the requirements of ICD-10. When this happens, then it is up to the coder, or clinical documentation improvement (CDI) specialist, to either refer the chart back to the physician for clarification, or decide themselves which code would best be applicable.
The same situation applies to clinical modification (CM) codes. For example, an ankle sprain, to be thoroughly coded to ICD-10 standards (i.e., S93.4_ _ _), requires both laterality (right-01, left-02 or unspecified-09) and the encounter (initial-A, subsequent-D, or sequellae-S) to construct the 7-digit code.
Unless all this information is present at the time of coding, then the organization must either query the physician for more detail or choose a lower value, unspecified code. Unfortunately, neither of these two options works in the organization’s favor:
Option A – If you opt to refer the case back to the physician, the chance of getting any additional information is small at best, expending valuable time with no positive result.
Option B – If your coders choose an unspecified code, then you would be able to drop a bill. However, your organization runs the risk of being graded at a lower risk and severity code, lowering reimbursement rates accordingly.
Fortunately, many electronic health records (EHRs), including all Allscripts products, provide tools to help clinicians select the right code and prompts complete documentation while charting. For those organizations that rely on paper charting, then the only real options are to develop a set of “reminder” sheets by service or specialty or rely on coders and/or CDI staff to identify these omissions and query the physician.
Whether you employ an EHR- or paper-based documentation system, now is the moment to make certain you have identified the core ICD-10 diagnoses for every specialty within your organization. Providers should be familiar with each, know what they need to document and how it should appear in the chart, and understand that every digit within the ICD-10 code has a specific meaning and purpose. It is up to the organization to make certain that providers are adhering to this process so that the financial and operational integrity remains intact.
If you’d like to learn more about how to assess, analyze, develop and implement ICD-10 readiness, contact us. Allscripts can help.
Editor’s note: If you’re looking for additional ICD-10 resources, check out Dr. Goldstein’s features in a recent IPI (International Pharmaceutical Industry) article and NRHA (National Rural Health Association) webinar.
Hospitals and physician practices have been discussing ICD-10 for many years. However, even with a one-year implementation delay, many of them are only now realizing that they are still not ready for the October 1 start date.
In the past month, our ICD-10 consulting practice has received more inquiries for assistance than in the past calendar quarter. We expect this pace will continue well into the coming months leading up to October.
A significant number of inquiries have come from organizations that have considered ICD-10 to be an IT or HIM issue. In fact, when looking at the scope within a hospital or practice that ICD-10 encompasses, there are more than a dozen areas that should be involved, such as revenue cycle and contingency planning. Ignoring any of these areas can have a detrimental effect on ICD-10 readiness.
3 most common ICD-10 readiness problems
Looking at the most frequently asked questions, we see three themes. Organizations often overlook them, but they are key to success: user education, documentation standardization and organizational governance.
1) Lack of adequate ICD-10 education
One would think that ICD-10 education would not be an issue, but in reality, it is probably the most common problem facing the healthcare community. Specifically, the problems we most frequently encounter are lack of education specific to a provider’s specialty, ongoing reinforcement of the requirement and training for best documentation practices within the organization’s electronic health record (EHR) product(s).
Even for non-clinical staff, such as coders, the overwhelming majority admit they need to refresh the skills and knowledge they acquired in 2014, if they are to be a skilled resource in October 2015.
2) Lack of standardized documentation
Another challenge is the wide variability in how clinicians document pertinent information. No one expects every doctor, nurse or therapist to document exactly like their colleagues. But within an organization there should be clear guidelines in place that mandate how clinicians chart key components of the medical record.
The issue comes down to being able to consistently retrieve pertinent clinical information to support the ICD-10 code. If the documentation is there but hidden in some dark recess of the chart, then the chances of clinicians being able to retrieve it for coding is minimal, and the organization risks under-coded charts, which loses money. At the other extreme is the situation where a physician selects a high-value code, but doesn’t chart the supporting documentation, thus over-coding the record. In either case, the outcome can pose a severe obstacle to the financial stability of the organization.
3) Lack of governance structure
The last, but far from least important, topic that we see relates to governance, both operational and clinical. Organizational leadership has to “own” ICD-10 and communicate the importance of ICD-10 readiness for the ongoing viability and financial stability of the hospital or practice.
Perhaps the best way to demonstrate this priority is to allocate the necessary time, money and human resources to assure success of moving into the realm of ICD-10. In addition to your clinicians, you have to consider all those who are involved in patient care as well as billing, coding, quality, utilization and other essential non-clinical roles. They need, at a minimum, a working knowledge of ICD-10 requirements.
Clinical governance requires staff leadership to hold providers accountable for both what to document and how to do it. Yes, the organization must offer the right tools so that proper documentation can occur, but the responsibility for using these skills is clearly within the purview of medical staff leadership.
Using the remaining time wisely
One question remains: “What can I do in the time before the deadline?” This is the most difficult question of all to answer. If an organization is willing to make ICD-10 its primary task through to October, then there is a strong possibility it can achieve a sufficient amount of readiness. It is more likely to be ready to start on October 1 and continue to make improvements and enhancements on an ongoing basis.
If, however, this same organization continues to delay in developing a comprehensive assessment and remediation strategy, then October 1 may be only the start of a descent into a financial abyss from which there is no way out.
If your organization does not have the resources to assess, analyze, develop and implement ICD-10 readiness, contact us. Allscripts can help.
ICD-10 is the largest mandate in U.S. healthcare history, and it will require diligent, comprehensive actions to be fully prepared for the transition. This is the fourth post in a four-part series that explores successful strategies in key areas of ICD-10 readiness: general approach, governance, education and standardization of documentation.
“The pen is mightier than the sword,” is a famous line from Edward Bulwer-Lytton’s 1839 play, The Conspiracy. Fast-forward nearly two centuries, we substitute the keyboard for the pen, and the idea is nonetheless the same; documentation is the quintessential element that translates one’s thoughts and actions into a durable record of key events in health care.
Unfortunately, the lack of uniform documentation is the Achilles’ heel for ICD-10 readiness across the entire industry.
Concise, thorough and comprehensive documentation is not only essential, but it is the required basis for not only ICD-10, but for value-based purchasing, bundled payments, pay for outcomes and managing episodes of care. Without solid documentation, hospitals and physicians alike will soon find themselves challenged to validate their work, which could lead to undervalued or denied payments.
Lack of consistency in documentation takes on many forms. It can be a hospital that allows its clinicians to document both on paper and in an electronic medical record. Or it can manifest itself as relying on free text or dictated notes that do not follow a consistent format. But perhaps the biggest challenge facing hospitals and physicians alike is not providing the level of detail needed to justify selecting high-value codes.
Good documentation is essential to surviving costly audits
The Centers for Medicare and Medicaid (CMS) is well aware of this challenge. In 2006, CMS instituted Recovery Audit Program (RAC) audits for the sole purpose of seeking to recoup Medicare and Social Security overpayments. To put this into perspective, the 2013 CMS Report to Congress noted that the Medicare Fee for Service (FFS) Recovery Audit Program returned more than $3 billion to the Medicare Trust Fund.
When looking at audit triggers and providers’ costs, hospitals note that medical necessity denials accounted for 96% of costly complex denials. Managing these audits can be expensive; 63% of all hospitals reported spending more than $10,000 managing the RAC process during the fourth quarter of 2012; 43% spent more than $25,000 and 13% spent over $100,000.
While hospitals were able to overturn about two-thirds of appealed denials, only 40% of hospital denials went to appeal. While there is less published data regarding physician practices, it would not be surprising to see similar numbers for this segment of the medical community.
Standardization returns significant value
Clearly documentation cannot, by itself, address all these woes, but coupled with strong governance and training on how to do effective documentation offers the best solution to avoiding these financial penalties. Wide variation in physician documentation processes within an organization, department or service can complicate coding, prolong billing cycles and inhibit effective communication across providers and with the patient.
Perhaps most disturbing are the potential clinical effects of poor documentation. In a 2013 study that examined the financial impact of CDI, there are significant increases in length of stay, cost of care and readmissions when documentation falls short of expectation for consistency and content.
Since launching our consulting service to hospitals and physician practices, only those organizations that have invested time and resources in governance, education and documentation are ready to move into ICD-10 pre go-live activities, such as testing and dual coding.
ICD-10 readiness is a journey, but unless the fundamentals are in place, moving toward an October 1 launch is an uphill journey on a very steep slope. Contact us if you’d like to learn more about how Allscripts can help.
ICD-10 is the largest mandate in U.S. healthcare history, and it will require diligent, comprehensive actions to be fully prepared for the transition. This is the third post in a four-part series that explores successful strategies in key areas of ICD-10 readiness: general approach, governance, education and standardization of documentation.
When Allscripts conducts an ICD-10 readiness assessment, a major area of review is to evaluate the organization’s educational programs. All too often organizations provide education for just the clinical providers (i.e., physicians, nurse practitioners and coding staff). But in fact, ICD-10 education should extend across the entire organization, be it a hospital, office practice, home health agency or any entity involved in direct patient care.
ICD-10 training for clinical staff has slowed to a halt
With the one-year delay in ICD-10 implementation, nearly every organization I have been working with has openly stated that educational activities came to an abrupt halt.
Now we are less than six months away from the October 1 deadline. Hospitals, clinics and ambulatory practices are looking to evaluate just how ready they are to move to ICD-10 and how best to address critical gaps in education and training.
ICD-10 education is often not viewed as a priority, with the possible exception of nursing. Instead of aligning physician education to high-volume, high-value care, physician training is most often addressed with generic online or brief classroom sessions. As for coders, the vast majority we have spoken with have forgotten large blocks of essential information because they don’t use it in their daily activities (i.e., no dual coding).
For non-clinical staff, ICD-10 training options are even slimmer
Physicians, nurses, coders and billers were the groups that have suffered the most. But other areas clearly need to understand what is needed for ICD-10 – such as Registration, Patient Access, Case Management, and Social Work – and they are no longer being trained in the fundamentals of the new coding system, either.
Any other areas that need to understand how ICD-10 operates have all but been ignored for education. They understand how this will impact not only their work, but it will also negatively affect collections through delays and denials. The effect on patient satisfaction and quality of care can be devastating.
To be successful, every healthcare organization must assess ICD-10 readiness and use the findings to create a meaningful education program. It’s a critical area of responsibility for the governance team. If your organization does not have the resources to assess, analyze, develop and implement ICD-10 education programs, Allscripts can help.
This overlap between governance and education is a critical part of the path to ICD-10 readiness. In our next blog, we will discuss how documentation is the third pillar in constructing an effective ICD-10 readiness program. If done properly, it can contribute to solid financial, clinical and operational outcomes – for ICD-10 and long-term revenue-cycle-management health.
ICD-10 is the largest mandate in U.S. healthcare history, and it will require diligent, comprehensive actions to be fully prepared for the transition. This is the second post in a four-part series that explores successful strategies in key areas of ICD-10 readiness: general approach, governance, education and standardization of documentation.
For a project as vast and complex as ICD-10, a successful organization needs a strong governance structure assigned specifically to this endeavor.
Setting up the governance structure
Leadership needs to define the operational structure required for ICD-10 readiness. It’s essential to have an ICD-10 executive sponsor and an ICD-10 “Czar” responsible for maintaining the project on a steady and consistent path. Once leadership designates these roles, they need to communicate them throughout the organization.
The next step is to establish an operational committee with representation from the key areas affected by ICD-10 (i.e., HIM, Coding, Billing, Finance, IT, Education, Nursing, Medical staff). This committee’s charter defines its roles and responsibilities. It should also provide specific guidelines, such as weekly meetings, a defined agenda and a mechanism for apprising the C-suite of both current state and meeting upcoming milestones. Leadership should empower this committee to recommend changes to the project’s overall structure and advise course corrections.
Communicating ICD-10 as a top priority
With governance structure now in place, effective communication provides the underpinning for a project of this size and importance. From the beginning, leadership must show its involvement and dedication to a successful transition to ICD-10 by informing everyone that this is top organizational priority. The organization can use various channels, such as meetings, newsletters, and yes, even an ICD-10 blog that speaks to the project’s goals, objectives, milestones and successes.
Assigning sufficient resources
The organizations we work with soon come to realize that a project such as ICD-10 readiness relies heavily on having sufficient resources available. For ICD-10, this means people, money and perhaps the most important – time.
Staff will require training, and this means identifying trainers not only for those who provide care, but for billers and coders. It means budgeting the dollars both for these resources and for upgrades and modifications to your existing IT systems so that ICD-10 can successfully operate within your environment.
But beyond this, leadership must realize that a project as important as ICD-10 will require time – time for education and training, time to ensure that the work proceeds as anticipated, and time for those overseeing this work to make certain it is being done effectively and efficiently.
The three pillars of ICD-10 success
Governance is but one of the three pillars of ICD-10. Education and documentation have equally important roles. ICD-10 is moving from 13,000 to 68,000 codes (and this does not include procedures). Clinicians need to understand the depth of clinical information they need to provide in order to justify which is the right code to select.
Our next blog will discuss the key issues surrounding how to educate staff on documenting for ICD-10. It may appear to be a daunting task, but with the right approach, it can benefit the patient, the physician and the organization.
If you’d like to learn more about how Allscripts can help you prepare your revenue cycle for ICD-10 and beyond, contact us.
ICD-10 is the largest mandate in U.S. healthcare history, and it will require diligent, comprehensive actions to be fully prepared for the transition. This is the first post in a four-part series that explores successful strategies in key areas of ICD-10 readiness: general approach, governance, education and standardization of documentation.
Benjamin Franklin once wrote, “…nothing in this world is certain except death and taxes.” Most of us in the healthcare industry agree it’s time to add ICD-10 to this list. On October 1, 2015, the United States will join 25 other countries in using ICD-10, the version that has been the standard for coding diseases, findings, medical complaints, causes and conditions of illness and injury since 1995.
When CMS announced last year that it would delay ICD-10 until 2015, the healthcare industry breathed a collective sigh of relief. Unfortunately, much of the industry has not used this extra time to further readiness. In a September 2014 letter to HHS Secretary Sylvia Burwell, Jim Daley, the chairman of Workgroup for Electronic Data Interchange (WEDI) stated:
“It appears the delay has negatively impacted provider progress, causing two-thirds of provider respondents to slow down efforts or place them on hold…while the delay provides more time for the transition to ICD-10, many organizations are not taking full advantage of this additional time.”
The organizations that are taking full advantage of this additional time to prepare recognize that ICD-10 is already here.
The biggest challenges in ICD-10 preparation
No coding system mandates that you have to use an electronic documentation system. However, with more than 68,000 Clinical Modifications (CM) codes and 76,000 Procedure Coding System (PCS) codes, an electronic health record (EHR) greatly simplifies aligning the correct code to the service(s) provided.
The problem many organizations continue to face is that no matter how comprehensive an EHR is, it is only as good as the information entered into it. Coding and Billing must be able to work together to retrieve clinical information and produce a clean and accurate claim. Or, as one of my CFO friends said, “For me to keep my job, I need to be able to quickly drop a bill that will be paid and doesn’t leave ‘money on the table’ due to under coding.”
As one of Allscripts’ principal consultants working with our clients on ICD-10 readiness, I see a wide range of diversity in how hospitals and health systems respond to the task. Perhaps the biggest challenge is that few organizations have truly embraced the concept that ICD-10 affects every part of the organization.
ICD-10 workflows start at registration and continue up to the moment the patient is discharged from the hospital or goes home from the physician’s office. Too often organizations consider ICD-10 as an “IT problem” or a “Medical Records matter,” when in fact the touch points involved in ICD-10 are significantly greater.
To put this in perspective, I consistently see three major themes that emerge during our assessments:
While these areas are not unique to ICD-10 readiness, each one has a number of critical elements that need to be in place to be ready for October 1. Over the coming weeks my ICD-10 blog post series will explore each area in more detail and steps that can lead to a successful transition into ICD-10.
If you’d like to learn more about how Allscripts can help you prepare your revenue cycle for ICD-10 and beyond, contact us.