America’s doctors, already struggling with the Affordable Care Act’s regulatory burdens, could face another round of red tape—which means higher costs for ordinary Americans.
The new round of red tape is the government-mandated implementation of the International Classification of Diseases tenth revision (ICD-10). The new system, delayed last year, goes into effect Oct. 1, 2015.
The ICD-10, created and maintained by the World Health Organization (WHO), is the latest version of the medical coding system doctors use to file claims for reimbursement with Medicare and insurance. (When you see a doctor, a code associated with your diagnosis determines how much your insurance will be billed.) The ICD-10 will replace the existing coding system (ICD-9), for medical diagnoses and inpatient procedure coding.
The new version of the ICD will increase the number of codes from 18,000 to 155,000. There is also a lot of unnecessary (not clinically relevant) data doctors must document to remain compliant.
While most Americans have probably never even heard of the ICD-10, if you go to the doctor or hospital you will be affected by it, in one way or another. For instance, the reimbursement your doctor receives is based on the code of the disease you were diagnosed with.
House Action. On Feb. 11, the House Subcommittee on Health, chaired by Rep. Joe Pitts, R-Pa., will hold a hearing on the subject. Congressmen (and senators) will quickly find out that the ICD-10 polarizes health care professionals. Most doctors oppose it: in fact, over 75 percent believe it will needlessly complicate coding and more than half believe it will create “severe” administrative problems. On the other hand, many big healthcare industry firms, especially those in the information technology (IT) business, support it. They say it will improve disease identification, increase productivity and improve medical payment.
According to one estimate, the ICD-10 will cost a large medical practice almost $3 million per year.
More Red Tape. The Health and Human Services report on ICD-10, often cited by supporters, concluded that no cumulative benefit would be observed until ten years after ICD-10 implementation. Congress may want to examine some other data. For example, since transitioning to the ICD-10, Canadian hospitals have observed a persistent decline in productivity and a 2014 study found that the ICD-10 would cause a decline in U.S. healthcare productivity exceeding that of the Canadians.
Implementation of the ICD-10 is also likely to cause severe reimbursements issues. A recent study at the University of Illinois Cancer Center found that the ICD-10 could cause the operating margin of some private medical practices to completely “evaporate.” While the ICD-10 will capture more data than the ICD-9, a significant amount will not be clinically relevant. According to Dr. Jonathan Handler, the chief medical officer at M*Modal, the “ICD-10 forces clinicians to spend time away from patients documenting ICD-10 specific details, many of which have low relevance.”
Higher Costs. Reports by many healthcare consulting firms including the Hay Group, the Robert E. Nolan Company and Nachimson Advisors, all agree that the ICD-10 will not only decrease the time doctors have to spend with patients, but will also increase healthcare costs. According to one estimate, the ICD-10 will cost a large medical practice almost $3 million per year. Increased administrative costs will be passed on to patients.
Doctors should not face even more red tape, on top of the new regulatory and reporting rules imposed by the Affordable Care Act and the massive regulatory regime that governs Medicare. The higher transactional costs of government regulation are always passed onto ordinary Americans in the form of higher health care costs. It has to stop.