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Regulations & Legislation

The Debate over the US's Antiquated Healthcare Coding System

a report by

Jori Frahler

Director of Federal Affairs, Medical Device Manufacturers Association (MDMA)

For many device manufacturers, coding perhaps is an issue best left to reimbursement experts. However, changes to a 30-year-old system are being debated in the halls of the US Congress, which will impact the medical provider, medical device sector and the patient, and will also influence how technology ­ particularly novel technology ­ is accounted for in the US and around the world.

Jori Frahler is the Director of Federal Affairs for the Medical Device Manufacturers Association (MDMA). Prior to joining MDMA, she worked for two years at the Center for Medicare and Medicaid Services (CMS) and for three years as a staffer on Capitol Hill. She worked for Congressman John Edward Porter (R-IL), former Chairman of the Appropriations Subcommittee on Labor, Health and Human Services and Education, and, upon his retirement from Congress, she worked for Senator Bill Frist (R-TN) as a member of his healthcare legislative staff. She received her JD from the Catholic University of America's Columbus School of Law and her BA from the University of Virginia.

The International Classification of Diseases (ICD) was developed by the World Health Organization (WHO) for the purpose of promoting international comparability in the collection, classification, processing and presentation of morbidity and mortality statistics. ICD codes are the most widely used codes in healthcare. Currently in its 10th edition, ICD-10 was adopted by England in 1995. However, the ninth edition (ICD-9), which was published in 1977, is the version that is still used in the US. This is problematic for the US healthcare system. Thirty years ago ICD-9 was able to precisely delineate the clinical picture of a patient; today, however, ICD-9 is not only outdated, but it is quickly running out of codes. As such, the US's adoption of the ICD 10th Edition Clinically Modified diagnostic coding system (ICD10-CM) and procedure coding system (ICD-10PCS) is imperative. Fortunately, legislation mandating adoption of ICD-10 has been passed by the US House of Representatives, but not by the US Senate. As such, it is the subject of debate in Washington. For those in the medical technology industry this debate is welcomed because, as modern medicine has progressed and medical technology has become more sophisticated ­ to the point where implantable devices are commonplace ­ ICD-9 has become obsolete.

Current System is Obsolete

and Medicaid Services (CMS) developed a transition plan for ICD-10. In addition, the majority of industrial nations ­ and, in fact, over 100 countries worldwide, including the UK ­ are using ICD-10 to report mortality data. As such, the continued use of the antiquated ICD-9 system by the US is problematic because its data are incompatible with the rest of the global community. In addition, the US's failure to use the international standard for the collection of diagnostic data severely weakens its ability to track and respond to external public health and bioterrorism threats. This could have severe implications with the looming threat of an avian flu outbreak. Should such a global outbreak occur, the US would be ill-equipped to assign proper diagnostic codes to the disease, potentially adding a layer of chaos to not only the domestic healthcare system, but to the entire global health community. Furthermore, the terminologies and classifications from the 1970s no longer work with a 21st-century healthcare system. That is why the US needs to adopt ICD-10. Not only will ICD-10 take the current code set from 24,000 codes to 207,000 but it will also allow for a more detailed description of procedures. For example, the sixth digit of the seven-digit ICD-10-PCS code reflects the use of a device that remains in a patient after the completion of the procedure. This level of specificity is needed to allow for precise tracking of device-dependent procedures. Beyond the need for global harmonisation of diagnosis codes, this level of specific coded health data serves as a foundation for billing, claims processing, pricing and payment. Therefore, having such an outmoded coding system is problematic for a number of reasons. Firstly, in an era of quality measurement, pay-forperformance and hospital transparency, the current coding system does not accurately reflect the procedures performed by physicians. Secondly, as new technologies are developed, the ability to obtain a code is becoming more difficult. This is causing the procedure of obtaining a code to resemble a coverage decision rather than merely a code. Thirdly, the

Moving to ICD-10 is not a new concept. In 1993, the US National Committee on Vital and Health Statistics (NCVHS), the National Centers for Health Statistics-Centers for Disease Control and Prevention (CDC) and the Centers for Medicare



The Debate over the US's Antiquated Healthcare Coding System

interoperability of health information systems is severely hampered by the US's use of an older coding system. In 2003, in an effort to encourage the US to move towards ICD-10, NCVHS again vocalised its position that ICD-9 was "increasingly unable to address the needs for accurate data for healthcare billing, quality assurance, and health services research," and that it was "in the best interests of the country" to move expeditiously to replace it. With the continued delay to move to ICD-10, it has become clear that the US Congress must pass legislation mandating its adoption.

Lawmakers Getting Involved

hospitals to track patient care processes and allow for accurate reimbursement ­ potentially eliminating fraud and abuse in the US healthcare system. Expanding and improving the coding system also would provide CMS with more flexibility and accuracy in its nomenclature, especially in identifying the broad range of new medical technologies and it would reduce the time lag for introducing codes for new procedures into the claims processing system.

Why the Debate?

In July, the House of Representatives passed HR 4157, the Health Information Technology Promotion Act of 2006. This legislation provides for the adoption of ICD-10 in October of 2010. Surprisingly, however, the ICD-10 provision within the broader bill is the subject of debate on Capitol Hill as the Senate passed companion measure, S. 1418 is silent with regards to the adoption of ICD10. Nevertheless, the medical device industry and hospital and coding associations are continuing their efforts to support passage of legislation this year that adopts ICD-10 in 2010. However, this would be quite a feat as there is only one month left on the congressional legislative calendar. Even more problematic, no conferees have been named to negotiate final language for the Health IT bill. Nevertheless, Senate Majority Leader Bill Frist (R-Tenn.) stated in August that he would like to win approval for healthcare information technology legislation "before lawmakers return to the campaign trail" in October. Fortunately for the American healthcare system, it is not just industry that is vocalising its concerns with the antiquated coding system. During the recent 12th Annual Meeting of the Medical Device Manufacturers Association (MDMA) in Washington, DC, CMS Administrator Dr Mark McClellan described the current coding system during his keynote address as "bursting at the seams". Other CMS officials have described ICD-9 as `antique' because the coding system no longer accurately describes the diagnosis and procedures of care delivered in the in-patient hospital setting. Further, with the US's push towards adopting national electronic health records, interoperable information networks will require modern classification systems for summarising and reporting health data. Equally important, ICD-10 will allow

So, why is there such deliberation about adopting ICD-10, especially when the rest of the global community is already using it? Certain stakeholders have raised concerns about the cost and administrative burden of implementing more than 200,000 new diagnosis and procedure codes. Some are also apprehensive about the cost of upgrading computer systems and retraining coders. However, such arguments only delay the inevitable because all parties agree that the move to ICD-10 must occur at some point. Therefore, the debate is really about when the US will implement it. Those opposed to the adoption of ICD-10 in 2010 are advocating for a 2012 or later implementation date, yet supporters of ICD-10 believe that six years is too long to wait, especially when this debate has been on-going since 2000. As US legislators try to move towards a compromise, those stakeholders with a vested interest in seeing ICD-10 implemented sooner rather than later have put forward recommendations. Further, a coalition of Washington-based associations ­ the MDMA, the Advanced Medical Technology Association, the American Health Information Management Association, the Federation of American Hospitals and the American Hospital Association ­ continues to stress the importance of this issue on Capitol Hill. Specifically, the coalition is supportive of implementing ICD-10 in 2010 because the expanded code set will provide more accurate and detailed clinical information that can improve quality measurement and patient safety activities while allowing for more accurate reimbursement ­ helping to identify and reduce fraud. Whether or not the US Congress decides to act now and pass legislation promoting the adoption of ICD-10, one thing is clear: the current system is outdated. This situation is not only affecting the multitude of stakeholders but it also ultimately impacts US federal government because the current coding system is not meeting the country's healthcare data needs. s




The Debate over the US's Antiquated Healthcare Coding System

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