[This Transcript if Unedited]
Department of Health and Human Services
National Committee on Vital and Health Statistics
Subcommittee on Standards
Industry Preparations for the Updated HIPAA Standards and
December 10, 2009
200 Independence Avenue, S.W.
CASET Associates, Ltd.
Fairfax, Virginia 22030
(703) 266 8402
- Welcome and Introductions: Judith Warren
- Panel 5: Testing
- Sunny Singh, Edifecs
- Cathy C. Graeff, NMEH
- Jerry Connors, Ed Hafner, DISA
- Edward Hafner, DISA
- Panel 6: Health Plans and Providers
- Nancy Spector, AMA
- Holly Louie, HBMA
- Sidney Hebert, AHIP
- George Arges, AHA
- Panel 7: Health Plans and Providers
- Joe Miller, HIMSS
- Darren Townzen, Walmart
- Dan Cobb, HealthMedX
- Scott Ransom, Brookdale Senior Living
- Donald E. Horton, Jr., ACLA
- Panel 8: Perspectives on 5010 and ICD-10
- Alec Dicks, Gartner
- Mark J. Williams, PWC
- David Biel, Deloitte
- Chris Handler, Ketchum
- Subcommittee Discussion
P R O C E E D I N G S (8:35 a.m.)
DR. WARREN: I am Judith Warren, and I am co chair of NCVHS’s Standards
Subcommittee. I would like to welcome everybody to day two of our hearings on
the implementation of 5010 V.0 and 3.0 and then the implementation of ICD-10.
Yesterday we had quite a bit of information about implementation. Today
we’re going to be talking about testing, health plans, and providers and then
looking at perspectives and the future of where we are going. So I would like
for everybody, if you have questions, if the testifiers think of anything after
the day that they want to give information to us, we will be accepting written
testimony coming in late, or not late but written testimony coming in, and we
will be posting some information and sending out notices about that after the
With that, I would like to have everybody introduce themselves. As I said, I
am Judith Warren. I am from University of Kansas School of Nursing. For all the
committee members, please state if you have any conflicts. I have no conflicts
at this time. Jeff?
MR. BLAIR: I am Jeff Blair, co-chair of the Subcommittee on Standards,
NCVHS. I am director of health informatics at Lovelace Clinic Foundation, and
there are no conflicts that I am aware of.
DR. SUAREZ: Good morning, everyone. I am Walter Suarez with Kaiser
Permanente. I am a member of the board of directors of WEDI and a member of
several of the testifying organizations, but I don’t have any conflicts. I am a
member of the committee and a member of the subcommittee.
DR. WARREN: Jerry, say your name and where you’re from.
MR. CONNORS: Jerry Connors, Data Interchange Standards Association.
MS. GRAEFF: I am Cathy Graeff. I am principal with Sonora Advisory Group. I
am here on behalf of the NMEH.
MR. SINGH: Sunny Singh, Edifecs.
MS. WILLIAMSON: Michelle Williams, CDC, NCHS, and staff to Standards.
MS. PICKETT: Donna Pickett, National Center for Health Statistics, CDC, and
staff to the subcommittee.
DR. CARR: Justine Carr, Caritas Christi Healthcare, member of the
subcommittee, member of the committee, and no conflicts.
MR. REYNOLDS: Harry Reynolds, Blue Cross Blue Shield of North Carolina, a
member of the subcommittee, chair of the full committee. I have no conflicts.
MS. DOO: Lorraine Doo, OESS, lead staff to the subcommittee. No conflicts.
MR. LARSEN: Herb Larsen, Edifecs.
MR. HAFNER: Ed Hafner with Foresight but also supporting DISAcert.
MS. SCHEYER: Patrice Scheyer with DISA.
MS. BENNING: Denise Benning, senior advisor and ICD-10 team lead, CMS,
Office of E-Health Standards and Services.
MR. TOWNZEN: Darren Townzen, Walmart stores.
MS. LOUIE: Holly Louie, Healthcare Billing and Management Association.
MR. BURLEY: Bob Burley, Healthcare Billing and Management Association.
MR. ARGES: George Arges, American Hospital Association.
MS. SPECTOR: Nancy Spector, American Medical Association.
MS. VIOLA: Allison Viola, American Health Information Management
MR. MYERS: Tom Myers(?), America’s Health Insurance Plans.
MS. JAMISON: Missy Jamison, CDC, NCHS.
DR. WARREN: That’s everybody.
Jeff, do you want to do any opening comments?
MR. BLAIR: No. Go ahead.
DR. WARREN: With that, I would like to introduce our first panel. Our first
panel is going to be discussing testing. So we’ll go right down the list that
you have in the agenda. So, Mr. Singh.
MR. SINGH: Good morning. Madam Chairperson, subcommittee members, fellow
panelists, ladies and gentlemen: On behalf of the 150 employees of Edifecs,
thank you for the opportunity to provide this testimony to you today.
My name is Sunny Singh and I am the CEO of Edifecs. It is a software firm
based in Bellevue, Washington.
Since Edifecs was founded in 1996, it has been our mission to help
organizations in many verticals — manufacturing, logistics, retail, health
care, to name a few — achieve interoperability between their internal systems
and external communities of trading partners.
Our products and services include tools and technologies that provide staff
productivity, community enablement and testing, data validation and quality
reporting, message tracking, transmission visibility, and accountability across
the entire transaction life cycle as they flow in and out of the enterprise, as
well the services to implement efficient transaction-processing
We would like to begin by providing the Subcommittee some information
regarding our experience in the healthcare market, which provides us with a
solid basis for sharing information we have gathered from our customer base
over the course of many years, working together to design and implement
transaction-processing solutions that are compliant with federal mandates.
Edifecs’ customer base today includes 23-plus state Medicaids out of the 50
Medicaid programs, programs that manage about 60 percent of the Medicaid
beneficiaries in the country.
Among Blue Cross Blue Shield plans, Edifecs counts 23 Blue plans across 29
states as customers, plans that cover 70 percent of the BCBS subscribers and
Additionally, Edifecs numbers 71 providers in our customer base, and among
them are the largest clients, such as Veterans Administration, Banner Life,
Allina, and Group Health Cooperative.
We also are pleased to inform the subcommittee that Edifecs, since the
beginning of 2009, provides full support for the mandated 5010, NCPDP, and
ICD-10 code-set standards and have made them available since that time to all
our customers, so that they may begin their work in earnest on these
initiatives with no delay caused by us as a vendor.
In the commercial health plan sector, Edifecs has 47 commercial plan
customers that manage over 76 million covered lives, and includes regional
health plans such as Harvard Pilgrim, Geisinger, as well as national plans such
as United Health Care, CIGNA, Humana, et cetera.
In the federal health care sector, Edifecs is proud to serve five of the
largest federal agencies, contractors focused on delivery and financing of
health care for our veterans, defense department employees, and active-duty
personnel, as well as the Medicare population.
Edifecs’ partnerships, particularly in health care, are very strong and
growing. We focus our partnership activities on top tier vendors and
organizations that provide the broader healthcare industry with services and
software infrastructure solutions that are vital to the industry’s efforts to
process healthcare transactions that are compliant with federal mandates and
that are flexible enough to implement new standards, as they are mandated, with
a minimal disruption to the efficiency of their eCommerce networks.
Our partners include seven of the Systems Integrator partners are in IDC’s
Top Ten, seven of the Application Integration partners in the Gartner’s AI
Additionally, the leading healthcare transaction clearinghouses use Edifecs’
products and services such as Availity and Emdeon, to name a few.
Edifecs also has strong partnerships with BCBSA, the association as well as
CAQH, where Edifecs is the only remaining core certification-testing vendor.
Edifecs participates actively in and sponsors a number of healthcare
industry workgroups that are focused on achieving global interoperability,
including X12, HL7, and WEDI. We consider this industry participation vital to
our continued success as a market leader in standards-support and enabling
We also consider our invitation to testify before you today validation of
our efforts, both commercial and pro bono, to help the healthcare industry
achieve levels of interoperability on a par with or exceeding that of other
Edifecs believes that our success in health care in large part stems from
our willingness to give back to the industry and to provide free tools to
assist the industry as a whole in the effort to adopt and implement new
standards quickly and efficiently. The tools, technologies, and services that
we provide without charge to the community include:
• Free software for standards development groups. Edifecs supports the
work of such groups as X12 by offering these groups no-cost access to our
market-leading standards development publication tool, Edifecs SpecBuilder.
• Free Web-based compliance testing and certification services. We
first offered free testing and certification against the mandated HIPAA
standards in 2003 for the migration to the 4010 versions and in keeping with
that tradition of service, we now offer free testing and certification against
the 5010 versions of the standards.
• Free comparison guides. Edifecs provides no cost access to
documentation that compares the 4010 and 5010 versions of the standards with
business insight and content for effective gap analysis and impact assessment.
• Free CORE certification testing. Edifecs provides free access to
stakeholders that wish to certify their systems for compliance against CORE
Phase I and Phase II rules. In fact, we are the only remaining CORE testing
vendor for phase II and moving forward. In addition to no-cost access to the
test suite, Edifecs has donated thousands of man-hours to support the CORE
initiative in both development and support analyst functions for stakeholders
during the testing process.
• And a new Edifecs-sponsored “wiki” community,
www.HIPAAPedia.com, which provides expert content and collaborative
environments for sharing best practices for implementation of HIPAA standards.
So we are not just 150 employees of Edifecs, we are patients, subscribers,
and dependents of an employer-sponsored health plan as well. The success of the
industry and the effort to achieve high levels of automation and
interoperability is a success for Edifecs as an employer, and success for each
of us individually as participants in the healthcare system, a system that is
truly overburdened with inefficiencies and their associated costs. These free
tools, content, and technology are a contribution to this effort on behalf of
Edifecs and all its employees.
Today I would like to share with you our observations and recommendations
for successful implementation of 5010 and ICD-10 standards, which of course
will be predicated on the need for the industry to embrace solid testing
methodology for each of these mandates.
As stated in my introduction, Edifecs has been helping those in the industry
implement the mandated standards, particularly in the testing arena, beginning
with 4010. We understand the challenges that were very much a part of the 4010
implementation and have worked very closely with industry groups, standards
committees, and our customers, to help all better prepare for 5010.
These strong customer and partner relationships that I have outlined have
provided us with a unique perspective and great insight into the challenges and
issues across many industry stakeholder types for implementing and testing new
versions of electronic transaction standards, “real-world” experience
from the front lines of the effort under way. This experience, combined with a
targeted survey to a selection of our customer base to test our anecdotal
observations and experiences will serve as a factual basis for our testimony
and recommendations today.
First of all, I would like to share with the subcommittee four basic types
of testing that we see in the industry today. We lump them under the umbrella
of community enablement. Those four include internal testing, external testing,
collaborative testing, and end-to-end testing.
In the next series of slides, I will define and provide some key
characteristics for each type.
Internal testing is predominantly the process of testing your internal
systems through which the information is processed. This could include your
front-end gateways, your translators, your practice-management systems, your
claims adjudication systems, all the systems through which information is
processed and all the systems they touch. Those systems have to be tested
internally component by component as well the integrated components through
which the entire information gets processed.
Under external testing, this is a testing paradigm which is very prevalent
in the industry today. At its simplest, external testing is really considered
transaction testing, a typical methodology used by many organizations today in
testing their Web portal.
Simply put, a trading partner or a business partner will push a file through
a Web portal and in self-service, real-time manner be able to get results
intelligently in a simple way, look at the results and the errors, and keep the
process going until they have satisfied all the conditions for testing with the
Our third type of testing is end-to-end testing. The end-to-end testing is
— there are different words used for it. Some people use interactive or the
interactions. Some people call it collaborations. It is a process of basically
from the initiation of the transaction to the fulfillment of the transaction,
how do you test that entire loop, that entire collaboration, that entire
That includes, for example, you receive a claim, the claim gets processed
touching many systems internally in your organizations. Remittances and
acknowledgments get generated and all of them received by the trading partner
who sends you the claim. Testing that entire loop — connectivity, translation,
validation, response transaction, acknowledgments — is what we call end-to-end
Finally, there is collaborative testing. In the collaborative testing
paradigm, there are more than two parties involved. Typically, collaborative
testing is conducted by one to three consortiums of various constituent types
including providers, payers, and vendors, who all agree on a standard set of
edits and testing methodology, whether it be simple transaction testing against
those standards and Companion Guide edits, or in a more robust methodology such
as that adopted by CAQH in its CORE initiative, the entire request/response
life cycle, examining not only for format and content compliance but against
defined expected results. This request/response life cycle testing is
equivalent to multi-party end-to-end testing.
In some cases a third-party software and service solution is used by the
consortium, such as the Edifecs solution employed by CAQH/CORE.
Now that we have briefly defined the types of testing that we see employed
today, we would like to share with the subcommittee our observations based on
our experience and the limited survey we conducted among the larger customer
set to test the conclusions we have drawn based on that experience.
For the current phase of work with 5010, we observed that the industry, at
least a very significant portion of it, is not where it needs to be in planning
and development for the magnitude of the effort associated with each
initiative. Many are just beginning their internal development efforts, which
places all subsequent milestones in jeopardy.
We also observed, based on our experience and a number of comments made to
us during the survey, many organizations are either undergoing or planning to
perform major upgrades or migrations from existing legacy systems which will
increase the risk associated with these efforts. They will experience the
project delays that typically occur with core system migrations of this sort.
Most organizations are to some extent, dependent on their vendors to support
the standards, and this dependency contributes to a significant concern evident
among industry stakeholders. There is also a clear recognition that not only
are stakeholders dependent on their own vendors, they are also dependent on
their trading partner vendors, as those vendors will need to deploy solutions
in time for effective and comprehensive end-to-end testing as described in the
We also observed that ICD-10 work is at very early stages, either
preplanning or early analysis, for almost all stakeholders. Given the many
business processes as well as system changes needed for this code set upgrade,
as well as potential disruptive impacts these changes may cause, this is a
significant concern. Many organizations do not even know where they will begin,
what the team looks like, or even who needs to be educated or involved.
Most payers are planning to implement some sort of crosswalk between ICD-10
and ICD-9, due to the lack of capability to support ICD-10 natively in legacy
applications and processes. These crosswalks will be complicated to implement,
will vary between payers, and the testing will need to be very robust to ensure
appropriate outcomes for reimbursement as well as for risk assignment and
management of covered populations.
The industry is largely unaware of the time that will be needed for internal
testing and development. Many are very concerned that the scope of the testing
that will be needed for ICD-10 will create the need for much more time than
5010, and certainly more resources will be required given the business impacts
of the coding changes.
Obviously, in order to begin external testing, internal testing must be
completed first. Please recall that internal testing consists of technical and
business testing, which for a large implementation such as 5010 usually takes
anywhere from six to eight months to complete.
As you have also discussed, many stakeholders are highly dependent on
vendors to supply the required support for standards. If you add the six to
eight months for the time for many to also integrate and test vendor solutions,
the time needed will increase by another three to five months.
Unless an organization has already completed with analysis and design at
this point for 5010, there is a serious risk that many will fail to meet the
Compliance Level I dates of January 2011.
As with 4010 and NPI, many are already expressing concerns about meeting the
dates. The key concern has been expressed to us across many stakeholder types
that although most feel confident that they will meet the dates for internal
development and testing, there is concern around trading partners’ readiness to
begin testing in January 2011, especially those trading partners dependent upon
vendor support of the standards.
For ICD-10, we observe that the compliance time frame, October 2013, is in
jeopardy as of now. Although other countries have implemented ICD-10, and there
are valuable lessons to be learned from those implementations, the fact remains
that there has been significant variation in the length of implementation among
those countries, anywhere from two years to five years.
We believe it is not realistic for any stakeholder to think they can wait to
complete 5010 implementation and then start ICD-10, and have everything
completed in 18 months. Looking at how long it took other large industrialized
nations to implement the ICD-10 code set, at the minimum, the U.S. will need at
least two years, by the most optimistic benchmark.
Clearly, given the scope of effort, the number of business processes
impacted, and the potential disruption, work on ICD-10 should have already
started. However, for many, the focus right now is 5010 and ICD-10 work is
still at the very beginning phases or not yet begun.
As we stated before, many entities are planning to implement a crosswalk
between ICD-10 and ICD-9, and for most the complete strategy around what to
crosswalk or how to implement them has not been decided. Add to this that no
two crosswalks will be identical. The time needed to complete internal,
external, and, if needed, collaborative testing in a trading partner network of
any size at all will need anywhere from 12 to 15 months in order to analyze and
understand the implications of the implementation, identify any gaps or errors,
remediate, and retest with trading partners.
As part of our preparation of this testimony, we reviewed our experience
with testing 4010 and combined this with our current observations and the
survey responses from our customers. Part of what we wanted to understand was
what are some of the key factors that might help improve and maybe even reduce
testing time frames. There were four key additional findings.
Based on 4010 experience, entities must have a strong test plan and allow
enough time to complete all levels of testing, including end-to-end testing.
We also observed that there was strong support for such organizations as
WEDI and NMEH in providing continued guidance, tools, and recommendations for
both 5010 and ICD-10 initiatives, and that the information provided today has
been of high value.
Additionally, most of the respondents believe that there is a value in
third-party testing and certification as a means to reduce both the external
and end-to-end testing with trading partners.
However, in spite of the value of third-party certification, most entities
will not require third-party certification. Many organizations expressed
concerns with the third-party certification process that affected its decision.
Several commenters stated that they felt it was relatively easy, given the
method employed by certifying entities, to game the system and manually submit
and certify transactions that were not truly created by core systems and
processes and that there was no appropriate level of due diligence by
Additionally, some commented that the differences in a
third-party-certifiers’ interpretation of the rules for the transaction created
as many issues as it solved. In other words, if the trading partner certified
with entity A and the organization itself had certified with entity B, and the
differences in compliance determination were evident, the benefit was limited.
Edifecs is pleased to present recommendations to NCVHS based upon our
experience as well as our analysis of the responses of our survey – again, we
have grouped our recommendations into 5010 and ICD-10 categories, given our
belief in some fundamental differences between the two initiatives and
potentially negative impacts.
Edifecs firmly believes that in order for 5010 migration to be successful,
vendors that support the stakeholders and industry, whether they be middleware
vendors, practice management, hospital information system vendors,
clearinghouses, or service bureau organizations upon which the industry
depends, should be held accountable to the responsibilities towards their
customers to support the standards required for migration and testing efforts
and soon enough to leave sufficient time for comprehensive end-to-end testing
between stakeholders during the 2011 time frame.
We further recommend that CMS take a very proactive stance with regard to
the Compliance Level dates outlined in the Final Rule for both internal and
external testing, and aggressively communicate this stance to the industry. If
there are no teeth to these milestone dates, then slippage becomes a foregone
conclusion for many of the entities in this healthcare service chain.
It is clear to most in the industry that third-party certification of 5010
is valuable to the process but with significant caveats that must be
acknowledged. Edifecs’ recommendations are threefold regarding third-party
Number one: The committee should explore how to resolve differences in
results and due diligence performed by third-party certifiers. We believe that
CAQH/CORE may provide a reasonable methodology that can be implemented with
real-time testing and results processing, as well as due diligence through
visual inspection to validate compliance before submitting and processing
systems can produce and consume the standard transactions.
Number two: If these variations in results and due diligence can be resolved
fairly quickly, we strongly recommend certification as a required step for
vendors and stakeholders.
Number three: Edifecs’ success story of free enterprise and competition,
while we firmly believe that government agencies, SDOs, and industry
associations should set the bar with regard to standards, we also believe that
there should be no exclusive endorsement of any certification entity or
product. These organizations, in line with their mission, should remain
We also recommend that those organizations actually achieving those dates in
advance of the deadline should be acknowledged by CMS, ensuring that additional
impetus is put behind initiatives by key executives at vendors and
stakeholders. One only has to look at CORE certification to see that type of
recommendation is a successful motivator for those decision-makers with
oversight for the 5010 initiative in their respective organizations.
Given the concerns and issues surrounding ICD-10 implementation and testing,
Edifecs recommends the following be considered by the subcommittee as it works
through its deliberations:
Edifecs advocates the normalization of all data when possible, and we
continue to believe and to recommend that there be a single authoritative
crosswalk implemented by all parties to reduce inconsistency in produced
results of testing and production transactions. We understand it is unlikely
that this will happen but believe that there should be a goal to reduce
variation in interpretation and execution.
Second, we recommend that provider organizations such as MGMA, AHA, and
other various provider specialty associations begin to plan and organize for
testing strategies that look at the result of the end-to-end testing performed
with payers for ICD-10. By result we mean not just did my transaction pass
validation and get accepted? We mean that the financial information in the
response from the payer, whether it be coverage determination from an
eligibility request or remittance advice from a test claim containing ICD-10
diagnosis and CPT coding or an ICD-10 for both diagnosis and procedure provide
the expected reimbursement per my agreement with that payer.
Third, we further recommend that these groups help their respective
constituents in documenting a range of scenarios typical to their practice or
population that will give them a good base line to compare against
reimbursements processed with ICD-9 codes. This range of scenarios should be
broad enough by provider type, practice, or facility treatment pattern and
diagnosis distribution to ensure that a significant portion of existing revenue
associated would be covered.
Additionally, each of these scenarios should be tested against all the
payers that provide the larger portion of provider revenue because, as we all
understand, without a standard crosswalk, it will be an exception if two payers
have precisely the same crosswalk.
We do understand that ICD-10 may appear to be a long distance down the road,
but we believe that ICD-10’s success with minimal disruption is dependent on
the industry starting this work immediately. It is apparent from our surveys
and speaking to many in the industry that work on this initiative is behind the
recommended time line as published by NCHICA and WEDI.
Communication and education are critical to ensure key milestones are being
met and ICD-10 external testing will have the time needed to uncover
discrepancies and errors in implementation and to mitigate against the
disruptions we believe are possible
Finally, we applaud the work of such organizations as WEDI, CAQH/CORE,
NCHICA, and NMEH and recommend exploring an expanded role for organizations
such as these in implementing the recommendations we have outlined here today.
I have a few more observations I would like to share if time permits, but
they are not over here. Can I take a couple of minutes?
DR. WARREN: Can you do it in about two minutes.
MR. SINGH: I can talk very fast.
We believe that healthcare organizations, HCOs, will follow what we call the
80/20 rule. They will be able to enable 80 percent of the testing using 20
percent of the effort, and then vice versa on the remaining 20 percent of the
trading partners. So they can make real material progress towards 80 percent of
the volume of traffic they get, so they will follow the 80/20 rule.
Secondly, we also believe that HCOs will perform what we call the minimal
rule set. Some people call it soft compliance, some people call it operational
compliance. They will test the minimum data set that’s required to test, and
for the rest they will suppress or relax the rules. It has happened before, it
will happen again.
They will also engage in 4010-5010 conversions so that they can support both
versions on the HIPAA 5010 side.
Next is the issue we recommend. The healthcare organizations should
implement 5010 one transaction at a time, in a phased manner. They should not
take all transactions at the same time. That is not efficient and perhaps not a
very workable solution.
We also recommend that the standards development process that is employed to
date needs a significant overhaul and needs to be made a lot more efficient
than it has been so far. It takes too long. This is not because the volunteers
who do this work are inefficient or not competent; it is just the process needs
to undergo a major overhaul so we can churn out standards much more quickly.
We also recommend that healthcare organizations, as they look at 5010 and
ICD-10, should use that opportunity — and we strongly believe that — use that
opportunity to modernize their information-processing infrastructures as part
of implementing these initiatives. Part of the reason it takes so long to
implement these initiatives is legacy infrastructure that a lot of companies
Also, lastly, collaboration for a mandate of this size and with these
aggressive time lines is inadequate in industry. We need a lot more
collaboration, whether it is across industry groups, whether it’s within the
government and the associated healthcare organizations, but the only
collaboration we have seen is severely inadequate for these initiatives.
On behalf of Edifecs and myself, I again thank the subcommittee for the
opportunity to present here today. We hope that we have been able to provide
some insight into the market developments that we have observed around 5010 and
ICD-10 migration efforts and the testing process anticipated or desired by
Thank you again, and I look forward to your questions.
DR. WARREN: Thank you. I’m glad I gave you the extra two minutes.
With that we will move to Cathy Graeff from NMEH.
MS. GRAEFF: Thank you. Again, my name is Cathy Graeff with Sonora Advisory
I want to thank you, Madam Chairman and subcommittee members, for inviting
the National Medicaid EDI and Healthcare Work Group, or NMEH, as we’ve called
it. NMEH was formed in 1999. It was a collaboration between CMS, with the
support of CMS, and also the NASMD. The National Association of State Medicaid
Directors Systems Technical Advisory Group, or STAG, collaborated together to
form NMEH, so that the state Medicaid agencies could work together in a
collaborative manner to achieve the first set of transactions under HIPAA in
the early part of this decade.
NMEH’s goal is to identify HIPAA issues common to Medicaid organizations,
define resolution to these issues, represent Medicaid as a collective group in
national forums such as this, to share ideas between the states, to share
common processes, while at the same time maintaining the programmatic
differences that occur between states.
I am here today to represent NMEH. Because of budgetary constraints, there
were no NMEH members of the states that could achieve travel budget to be here
today. So I am here as a reporter to provide you with information that has been
consolidated based on a survey that was done by NEMH just this past November.
It does include testing, but I also want to share with you some interesting
insights related to the readiness of NMEH.
We were really happy with the responsiveness that we got from the states and
the territories. We had 27 states that responded to the survey on the
transactions and 24 states that responded to the survey on the ICD-10 code set.
We had large representation from all parts of the country, and we had
representation from different-size agencies. In fact the demographic slide
shows that we had response, 40 percent of the responders have Medicaid
recipients, covered lives, in the 100,000-to-500,000 range, but 20 percent of
the respondents have over 1.5 million covered lives in their programs. So we
had the large states as well as small states represented in the survey.
Similarly, we had states that had large staffs. Sixty-three percent of the
respondents had between 100 and 500 staff members in their programs, and 26
percent of the respondents had only 10 IT staff members in their programs.
Forty-eight percent of the respondents had between 10 and 50 IT staff members
in their programs. So we do have information regarding the resources that are
available to accomplish these objectives within the states.
Just for a moment I want to review the funding process that occurs in the
Medicaid programs. There is the availability of federal financial
participation, or FFP, for automatic data-processing equipment and services,
and there are conditions for this federal financial participation. CMS requires
the submission and approval by the Medicaid agency of an advanced planning
document, or APD. A “P-APD” is the terminology used. They also
require submission and approval of an implementation or an “I-APD” in
order to receive federal financial participation for the work that is done
related to data-processing equipment and services.
The amount of federal financial participation varies depending upon the
activities. Development activities receive 90 percent federal financial
participation. The operations, the additional hardware that may be required for
these systems, receive 75 percent federal financial participation.
But, interestingly, training, testing, and documentation receive only 50
percent federal financial participation for the expenditures that the state has
that have been approved by CMS.
When we did our survey — and I helped NMEH in a pro-bono way to achieve
this survey — we followed somewhat the WEDI survey because we felt that it
would be helpful going forward as we re-survey that we would be able to track
what the progress was with the Medicaid programs as opposed to or as combined
with other payer types.
We did find that 44 percent of states have not yet submitted to CMS a
planning APD for the transactions. Seventy percent of states have not yet
submitted a planning APD for ICD-10 code sets. So the planning APD has not yet
Now, of those that have submitted, 33 percent of the states have received
approval from CMS for their planning APD for 5010, 17 percent have received
approval for their planning APD for ICD-10, and 11 percent of the states in the
case of the transactions and 8 percent of the states in the case of the code
sets have received approved I-APDs.
So a question that comes to mind is, why are we where we are? Why don’t we
see these planning APDs submitted at this point?
We had a free text question, and we got a lot of responses. We got about 62
responses, and they fell into these various buckets. You can see that there are
very similar reasons between the transactions and the code set: conflicting
projects and priorities; resources, staffing resources, funding resources. But
in the ICD-10 code-set bucket we also see two that were not in the top five on
the transaction bucket, which was the education and training that’s required
for ICD-10, which is much higher than in the transaction requirements, as well
as the availability of that state match, that 50 percent state match, being a
real hurdle for the states to overcome as it relates to education, training,
DR. WARREN: Can I interrupt just a minute? Can you go back and just restate
the matching state funds? Is that only for education or is for the rest of it
MS. GRAEFF: The federal match for documentation, training, and — Lorraine,
correct me if I’m wrong — education, training, documentation is 50 percent.
DR. WARREN: All right.
MS. GRAEFF: We also asked, well, is it tougher now than it was back when we
implemented HIPAA I, when we went through Y2K, and when we implemented NPI? In
that question, we found about two-thirds of the respondents in both the case of
the HIPAA transactions and the ICD-10 code sets, said that they had
significantly more or somewhat more on their plates. About a third of the
respondents in both cases said it was the same as prior initiatives or
mandates, but two-thirds said it was more complex because of conflicting
priorities and the availability of funds.
But in the case of ICD-10, you will notice the turquoise part of this pie
chart, 54 percent of the respondents felt that ICD-10 was significantly more
complex than previous mandates.
So now on to internal testing. With that background, you can see that 89
percent of the respondents do not expect to be doing any internal testing on
the transactions by the timeline-expected date of 6/1/2010. Actually, zero
percent of the states thought they would be doing internal testing by that
time. Eighty-nine percent of the states did not even think they would have
completed internal testing by the end of 2010.
The highest percentage, 44 percent of the respondents, expect to complete
internal testing in the first two quarters of 2011. But 37 percent of the
respondents said it’s too early for them to even know, it’s too early to tell.
Similarly, with ICD-10, no respondents expect to complete internal testing
prior to July of 2012. Only 12 percent of respondents expect to complete
internal testing by 12/31/2012, and 88 percent of respondents expect to be
testing internally, not externally but internally, in 2013, which is October
being the compliance date.
Again, 62 percent of those that did respond felt that it was really too
early, so that 62 percent is imbedded in the 88 percent of respondents that
thought it would probably not be until 2013.
When asked about the barriers to testing that the states felt, I learned
something that I didn’t know, which was that because testing, perhaps because
of the matching funds, perhaps not completely because of matching funds and
resources, few states have the ability to maintain and to test environments or
test systems for their own internal testing. Part of this may be related to the
relationship that they have with their fiscal agents, but it was a surprise to
me that test environments or test systems are not commonplace in the 50-odd
systems that exist out there in Medicaid, and the territories.
Again, the respondents felt that the reason for this was lack of resources,
lack of development and maintenance, funding for those items, and the resources
necessary to maintain those systems.
On the subject of collaboration, we have a little better news. Forty-eight
percent of the agencies have planned or are planning — are actively or are
planning collaboration, with an additional 37 percent, probably the same 37
percent, saying it’s too early to know on the transactions side.
Less than that, 29 percent of the agencies, have active or planned
collaboration on ICD-10, with an additional over half of the respondents saying
it was just too early to even address collaboration for ICD-10.
But it did seem, based upon history, that collaboration was something that
the Medicaid agencies had participated in in the past to a certain extent and
want to participate in the future more so.
The challenges to collaboration that were outlined, again we got a number of
responses related to — 42 different responses for ICD-10 and 34 for the
transactions. But they fell into these major buckets.
As previously Sunny mentioned, who’s the leader of the band? One of the
challenges to collaboration is the executive sponsors that are necessary to buy
in and to implement and to structure collaboration within the states and the
resources that are required in order to orchestrate that collaboration, and the
training that is necessary and the management support are the major barriers to
collaboration, although collaboration is something that was generally believed
to be valuable and something that should be done.
The undertone of the survey was that states appear to be feeling overwhelmed
under the current economic situation. They are in a situation of staff layoffs
or furloughs or hiring freezes that hinder their ability to be able to track
onto the time line. They are concerned, and the respondents to the survey, I
must say, are not Medicaid directors. The respondents to the survey are the
NMEH members who are in the trenches, involved in the implementation. They are
concerned that management is not fully aware of the task ahead of them in this
area and that the lack of compliance by some Medicaid agencies in the past as
it has related to some of the transactions and to NPI is causing states to sit
back and consider what are the negative consequences of noncompliance.
Then the funding mechanism which I mentioned before on the testing,
documentation, and training and the fact that only 50 percent matching funds is
So those were the themes that we heard all the way through on the free-form
So, in conclusion — and I did not have the benefit of hearing some of this
information yesterday, but I trust that it is consistent with what you are
hearing — that Medicaid as a group really have not begun significant work on
these standards. There are some possibilities of funding that are available
through other federal programs that can help support the MMIS changes that are
required for ICD-10 and for the transactions, but the timing may be an issue.
I am speaking specifically as it relates to EHR and the movement of health
information exchange and health information technology under ARRA. There may be
some funds that can be helpful in this process as well. But trying to put that
whole puzzle together and how to best leverage the funding that’s available to
me as a Medicaid agency, is something that many of them are struggling with at
Also, the state budgets and the funding mechanism that exists are impacting,
as I said before, the activities.
NMEH is actively and proactively working to remedy, as best they can, the
situation. They have worked with WEDI to negotiate discounted membership for
Medicaid agencies to involve themselves in the WEDI sub-workgroups related to
the transactions and the ICD-10 code sets. There are Medicaid staff members
within these states that are participating on WEDI sub-workgroups, and they are
involved in sharing WEDI information with other staffs in their specific
But travel is an issue for them. They are not able to attend conferences.
They are seldom able to attend audiocasts, even, as this becomes a budgetary
So NMEH is also working on their own educational materials and sharing
expertise amongst each other. Again, as I said, this collaboration between WEDI
and NMEH is very important to NMEH to help with the education process.
There were some suggestions that NMEH had that they wanted me to present to
you. They wanted CMS to explore the availability of enhanced funding for all
activities required for newly mandated standards; that the 50-50 split for
education, documentation, testing, and training, if there was a way to
reconsider that under the current economic environment.
Perhaps similarly to what has occurred in the past under ARRA, there may be
increased federal financial participation funding for states which demonstrate
a real need for increased financial participation in order to meet these dates
or to meet these mandates.
The priority of these mandates and the importance of meeting these mandates
needs to be clearly communicated to executive management within the Medicaid
NMEH felt that it may be important to consider ways to hold states
accountable for compliance. Perhaps links to increased federal funding for
needy states might be ways to hold states accountable for compliance, which in
the past they haven’t felt that accountability.
With that, I look forward to any questions I might be able to answer, and if
I cannot, Susan Ackley, the NMEH chair, has offered to provide written
responses to any questions that you may have.
Thank you very much.
DR. WARREN: Thank you for a very good summary and the survey.
With that, we will move to Mr. Connors for DISA.
MR. CONNORS: Thank you for the opportunity to address the NCVHS Standards
Subcommittee regarding the planning and implementation of the Accredited
Standards Committee X12 005010 transaction standards for testing and migration
to that standard.
My name is Jerry Connors. I am president of the Data Interchange Standards
Association. DISA advances the foundation of electronic trade and commerce by
supporting and promoting standards that improve business processes and
productivity and reduce cost in business-to-business data interchange.
Our experience is particularly relevant, as the Federal rule to implement
HIPAA modifications to the 5010 standards was mandated in January of this year.
DISA has worked with many organizations that develop electronic business
messages and has been the ASC X12 Secretariat for 30 years.
I am joined today by Patrice Scheyer, DISA’s director of marketing, and Ed
Hafner, chief technology officer of Foresight Corporation, with which DISA has
partnered to create the DISAcert certification service that we’ll discuss
later. Foresight is a leading provider of transaction automation,
validation, and reporting software for the healthcare industry. In addition to
his role with Foresight, Ed is active in the industry, in particular as a
member of the Workgroup for Electronic Data Interchange (WEDI) Board of
Together we will testify to address issues and recommendations regarding the
transition to the ASC X12 5010 standard and the role of testing and
certification to ensure 5010 migration readiness for the entire healthcare
We will provide some insights on where the industry currently stands in
terms of 5010 compliance. We will discuss some of the major differences between
4010 and 5010, a few lessons learned, and recommendations to improve the
migration process. This is based on feedback from the industry and the private
We are also going to specifically focus on the questions posed to us with
the invitation to testify here today:
• What are key issues that will impact testing between trading
• How should testing be scheduled?
• Should there be collaboration between entities; that is, a large
group of providers?
• If so, what kinds of entities should collaborate, and how?
• What are the challenges for testing and collaboration?
The implementation of the 4010 standard exposed significant variables and
ambiguities in interpretation. The 4010 migration experience showed us that the
industry sought to:
• Identify an authoritative interpretation of the changes;
• Highlight specific conditional changes in the standard;
• Consider common-use case scenarios;
• And address business-specific tests.
Compliance with 5010 will address all of these issues and improve healthcare
industry productivity and business processes. We need to focus on the
compliance deadlines, which are Level 1, January 1, 2011; Level 2, January 1,
Each organization’s status is affected by the status of their trading
partners in this process, highlighting the importance of testing and
I am going to turn it over to Ed right now to go into some more detail.
Thank you, Ed.
MR. HAFNER: Thank you, Jerry.
Good morning, everyone. My name is Ed Hafner, and I will be attempting to
focus specifically on these questions and would welcome any questions that you
I will be answering those questions based on my experiences working with
large payers and small payers, large providers, vendors, and clearinghouses
through our Foresight customer base; my experiences working with many members
of the WEDI initiative as a transaction co-chair for WEDI, as well as being the
DISAcert technology vendor.
What issues impact testing between partners? We believe the final rule
established earlier this year was a fair one. It considered industry feedback,
adjusted time lines based on this feedback, and introduced a new phased
approach for everyone in the industry to first become self-ready and then, in
2011, to go ahead and get your partners migrated.
We do not believe in the word “contingency.” To advance healthcare
IT, meet ICD-10 goals, and start realizing benefits for the industry, we need
to rally to meet these goals. We did it with NPI and we should be able to do it
now. There is so much to be counted on in the future.
From our observations, many organizations did not jump on the 5010
transition other than doing some initial gap analysis and are behind in
becoming 5010 ready to meet that Level I testing. Based on a recent survey from
WEDI, which I’m sure you heard about yesterday, the most alarming discovery was
the number of organizations waiting for their vendors and clearinghouses to be
ready. Those same vendors were not targeting their 5010 releases until the end
of the 5010 Level I compliance period in December 2010. Of course, for those
payers and providers who are counting on those solutions to be there, they will
be late for Level I.
In a most recent conversation I had this week with a vendor, they claim that
the Level I mandate was a soft one, that it gives them flexibility, especially
if their competitors are not releasing their software before 2010.
Other challenges for Level II compliance are migration difficulties due to
inconsistent testing by partners, tracking readiness of partners to know when
they are ready to migrate, and the lack of pursuit of starting partner
migration planning. Our WEDI transaction testing team will be addressing those
Level II planning issues beginning in January.
We recommend a firm date being set for clearinghouses and vendors to be done
earlier and also recommend certification-like solutions, as Sunny mentioned, to
automate consistent testing.
How should testing be scheduled? For those organizations that have many
electronic partners, they need to respect the Level II challenges and be
planning the migration starting in mid-2010. A healthy approach is to identify
those partners that are early adopters and perform pilot migrations using each
other’s mutual testing plans. Many lessons could be learned from these early
tests, and by applying lessons learned, they will be able to streamline
smoother migrations for the masses.
We recommend loading the schedule early; in other words, trying to get the
partner migrations done in the early part of 2011, and anticipate that some of
your partners will be late. A good practice would be to exchange migration
testing criteria early so that organizations can anticipate Level II testing
criteria while they are doing their Level I testing.
If one partner is not converted by the beginning of 2012, an organization
with its partner base is not compliant with the 2012 date. So, if this is true,
this needs to be strongly stated to stir up collaboration between partners.
MR. REYNOLDS: Can I ask a clarifying question?
DR. WARREN: Yes.
MR. REYNOLDS: The last statement on the previous slide, that’s 2011, that
last date, right?
MR. HAFNER: Oh, 2011.
DR. WARREN: Right.
MR. REYNOLDS: Okay, fine. I wanted to make sure we fix the record.
MR. HAFNER: Harry, we did not plan on moving the date for you.
MR. REYNOLDS: No, no, no.
MR. HAFNER: I understand.
MR. REYNOLDS: I just wanted to make sure the record shows that that’s what
MR. HAFNER: Thank you.
Collaboration between partners would be a tremendous help. Organizations in
the payer and the provider communities which are represented here have
infrastructures to effectively communicate messages, provide training, publish
resources, and work with other organizations.
My personal experience working with EDI dates back to 1983. I am very old.
The model that has worked in other industries, like automotive, electronics,
retail, is a hub-spoke approach. It’s not always appreciated, but it’s one
where the hub, or such as a payer, drives their community as a leader to become
In health care there is a unique situation. We actually have collaborations,
which is actually healthier. You could look at places like North Carolina down
south with Sharp, Utah, New York, the Minnesota collaborative, and there are
others. We need to inspire those regional communities that are not active in
5010 to get moving, and if a regional collaborative is not strong, we need to
encourage a strong payer-sponsored approach; in other words, encouraging payers
to take the leadership role.
So in summary, call to action these communities who once helped so well with
the 4010; call to action those payers and providers, organizations like WEDI
and others that are represented here. And for those lacking those resources,
inspire a hub leadership role.
What kinds of entities should collaborate? Well, certainly vendors and
clearinghouses in many cases will be a success factor. Many organizations trust
these solution-providers and look for them to make them compliant. They believe
that they have outsourced their electronic commerce responsibilities so they
can focus on their main business. I believe these vendors and clearinghouses
need to be held for these responsibilities and they need to be accountable so
that they can make their customers compliant.
As mentioned on the previous question, payer leadership is essential, and
collaboratives as well as payer/provider organizations can greatly influence
whether we as an industry can be successful.
In my experience selling solutions to payers, those that are nationally
based and regionally based, there are some significant differences how they
have implemented 4010, and it looks like it will carry over to 5010
In some regional areas, payers have strictly followed the implementation
guides; in others, they only applied the syntax, or in WEDI we call those types
1 through 2.
In others, they actually (use) syntax and then selective semantic-type
edits. Factor in the presence of payer guidelines. It presents challenges for
national payers trying to connect to providers in regional areas; also
challenges for clearinghouses to meet those diverse payer needs. And for those
brave providers that attempt to directly communicate with regional and national
providers, there are challenges.
We believe the implementation guides should be strictly followed.
Our second recommendation will now be carried over to Jerry. Thank you.
MR. CONNORS: Thanks, Ed.
The window to achieve compliance is closing, as you all know. There is just
a year for healthcare entities to prove to trading partners that they will be
ready for the 5010 migration. They should be completing their design solutions
now and moving toward testing for Level 1 compliance.
Considering this slow progress towards Level 1 compliance, DISA recommends a
consistent, automated 5010 testing approach, backed by industry experts. The
result is a higher probability to achieve Level 1 compliance on time, as well
as a higher level of consistency for 5010 implementation.
DISA saw the need to enhance the opportunities for effective 5010 compliance
and partnered with respected industry organizations to provide a solution. We
wanted to provide additional intellectual and technical expertise to satisfy
the needs of the entire industry.
Our partner organizations provide the following expertise:
Foresight, as I mentioned earlier, provides this expertise in transaction
validation and automated trading partner testing, and e-Emergence provides
expertise in the interpretation of conditional changes from the 4010 to 5010
versions of the transactions.
We developed a testing solution with these partners called DISAcert, an
expert testing and certification service that represents an established
foundation for migrating the industry with scenario-based testing.
Scenario-based testing allows for a single test file to satisfy a number of
test requirements and illustrates compliance progress on detailed testing
DISAcert also includes a KnowledgeBase service, which is the repository of
answers to relevant 5010 certification questions and interpretive content and
guidance from the standard’s authors.
The objective of DISAcert is to certify readiness for the changes from 4010
to 5010, so organizations can ensure that they are fully prepared to begin
partner-specific testing with their trading partners.
We want to share feedback from industry representatives who replied to an
informal DISA survey, conducted in late October 2009, to assess migration
progress. The results we received correspond with survey results received by
other organizations, such as WEDI, and are consistent with what you will hear
in other testimony this week.
Nearly 50 percent of respondents told us that they are just beginning to
look at the 5010 transition. Another 39 percent are at the Level I testing/gap
analysis stage. Eleven percent have started Level I testing/development. Five
percent are at the Level I/design stage.
Again, this indicates that these entities are in the initial stages of their
migration process and how much they would benefit from a testing service such
as DISAcert, as we approach the Level I compliance deadline.
Nearly half, or 44 percent, of the respondents said they plan to use a
certification service to facilitate 5010 compliance. Another 35 percent said
they are still unsure about their plans to certify their transaction sets as
they migrate towards the 5010 standard.
We are asking for the help and support of NCVHS to make 5010 testing and
certification programs such as DISAcert known and available to the healthcare
industry. We are grateful to your assistance in reaching out to other
organizations and making this a known option to secure 5010 compliance.
Again, survey results indicate that, at this rate, the industry will not be
5010 compliant by the January 1, 2012, deadline. Nearly one-quarter of
respondents said they are not certifying for 5010, and another 36 percent will
not even begin certification until mid-2010.
We need the assistance of NCVHS to follow the recommendations we’ve outlined
today and to help create a sense of urgency regarding the importance of 5010
To conclude, these are our recommendations. We ask that NCVHS:
• Set an earlier date for clearinghouses and vendors to be
• Support and recommend consistent, automated certification, backed by
• Recommend solutions to automate consistent testing.
A point of emphasis: An organization is not Level II-compliant until all of
its partners are migrated by the end of 2010.
DR. WARREN: Two thousand eleven.
MR. CONNORS: Two thousand eleven, sorry, again.
• To enlist aid of provider organizations, such as AMA, MGMA, and payer
organizations, such as Blue Cross Blue Shield Association and AHIP.
• To consider collaboration through certification organizations and
• To inspire leadership by payers.
• To engage associations’ help to raise awareness and help their
membership succeed in the 5010 migration.
Again, we appreciate the opportunity to testify here today, and we would be
glad to respond to any of your questions.
DR. WARREN: Thank you for your presentations. We will now start with
DR. SUAREZ: Thank you for the testimony.
I have two questions. One is related to the phasing. We heard about the need
to move or to try to set an early target for testing for clearinghouses and
vendors, primarily. We heard yesterday and throughout several testimonies that
we have listened to the importance of phasing not just testing but
organizations, and not just testing on organizations but perhaps phasing also
transactions, so not do, one single day, everybody ready for every transaction,
try to establish some orderly process for phasing in.
So besides the recommendation that you’re making about phasing earlier the
testing for vendors, would you recommend phasing an orderly process for various
transactions; for example, starting with eligibility to 70 to 71 and then
moving to claims and claims payment and then moving to the other transactions?
Would that be something that you would recommend doing?
MR. HAFNER: I would like to answer that one question. With 4010A we were
actually taking transactions that sometimes not electronic, and we were
implementing business processes to be able to make that happen. With 5010, we
were doing conversion. Those transactions should already be in place. A lot of
those back-end systems should be there.
At the WEDI PAG that we had last year, we discussed that very same issue,
and we all agreed that phasing by transaction was just — it is not quite the
same as 4010A, that we ought to really focus where the real action is, which is
partner migrations. We have to get people moved from one system to another.
So, personally, I do not agree with transaction phasing.
MR. SINGH: I think if you would implement, an organization would implement
by transaction type — that is eligibility and claims service — that is a good
best practice. I don’t know how feasible that is in practicality to be able to
mandate to the industry, partly because organizations will have their own
priorities by which they want to implement those transactions.
So there is absolutely no reason we cannot come with recommended best
practices which we believe are good best practices that are being followed, and
good results would derive from that, but I don’t think that can be mandated.
As regarding clearinghouses and vendors having an earlier date for
compliance, I think that’s a great best practice. I just do not know how
practically feasible it will be in terms of ensuring that they in fact do
comply with that date. So it is a question of the intent can be there but the
reality might be different. But they are very good best practices.
DR. SUAREZ: Thank you.
My second question is about certification. All of you talked about the
points of certification. I think one of the lessons learned in 4010A1 was we
didn’t have necessarily a very good approach for certification, and ultimately
the industry struggled with what to do about it, but the industry took care of
it through market forces, I guess, and through different approaches.
I could not agree more with the statement about the need for a consistent
approach to certification and that it is certainly automated. The question is,
how do we organize this, how do we approach it? Should there be — I don’t
necessarily think there is any — certifiers of certifiers, or should we depend
on the industry to, just like in 4010 but based on the experience from 4010,
take care of the certification process?
MR. SINGH: I will chime in first. First, in our testimony, we recommended
that certification is a good thing. But I will give an analogy of what we truly
believe certification achieves in the whole end-to-end testing. By the end of
the day, certification is a small piece of the puzzle of what we believe is a
full migration process vis-à-vis testing.
So I compare doing certification as running around the block a few times to
prepare for a marathon. The marathon is 5010 migration. This is the whole
testing, from internal testing, external testing, and the whole end-to-end
testing. But the end-to-end testing is the most imperative stuff, which we
believe that most of the organizations today are truly lacking when it comes to
So yes, it is good to do certification. We recommend it. It is a Good
Housekeeping Seal, so to speak, it is a good best practice. But we at Edifecs
do not believe that certification by itself will make a material dent in any
way, shape, or form, in your entire end-to-end testing process.
I think the testing process should be driven by the big organizations as
payers because they can really streamline this process with the trading party
As regarding normalization, certified certifiers or the normalization of
edits so that all certifiers produce the same results, I think that is a very
noble goal, if there is a way possible to achieve it. The only way that can be
achieved is if the certifying entities, us and others, come to the table and
agree to collaborate together to say let’s look at the results and let’s
normalize those results where they are not the same. We will extend an
invitation to all certifying entities in the country today that we are willing
to come to the table, and we need the charter that will bring them to the
table, work with them, and normalize the edits.
So we want to make the gesture out there to all such vendors, and we will
lead it, we will show the leadership. I just do not know how many of them will
be willing to come to the table and make it happen, not just intent. There are
just too many things going on.
So if you can do it, fantastic. If CAQH/CORE can do it, fantastic. That will
be Nirvana. But it has been tried before and didn’t succeed. But we would love
to see that succeed.
MR. HAFNER: Actually, for 4010A, if you remember the initiative HCCO CCAP,
they brought together about 15 or 17 different vendors and certification and
testing tools, and they would go ahead and have you run through standard tests
to make sure that edits were close.
I think there was a very positive effect from that. I think you will find
Edifecses and Foresights and Ingenicses and others that are out there having
some pretty consistent edits within their systems. I would have confidence that
those who went through CCAP testing would have pretty consistent edits going
So, overall, I think a recommendation to do certification, not a mandate but
a recommendation of those companies that have gone through that type of process
is very positive.
I do recommend, however, for those who are selecting a certification, to
make sure that they’re exercising their applications and their maps efficiently
to make sure they truly have done all the 5010 changes, so that would be
MR. SINGH: A quick, small comment again. If the payers have a very solid
test plan to enable their community and they are aggressive about rolling those
project plans out, I think that will do far more good. As regarding
certification concerns, that is par for the course, that can be taken care of.
But if they have very good project plans around testing the whole cycle with
aggressive deadlines, aggressive outreach, I think that will be far more
effective than some of the other things we are considering. In the overall
scheme of things, in order of priority, I believe that’s the most important.
MR. BLAIR: Thank you.
MR. WARREN: Harry?
MR. REYNOLDS: Yes, Judy. The first thing I would like to do is state that I
am chair of CAQG/CORE. I didn’t realize it was going to become such a
commented-on item here. I don’t believe there will be any recommendations that
relate to it, but I did want to make sure that that was on the record.
This is very much almost a repeat of the training discussion yesterday, a
lot of good people coming up with a lot of good plans, but a lot of people
behind. So I think it’s a great update for us, Cathy, on the Medicaids. We
heard a lot yesterday, and this — I know it has heightened my interest and I
am sure the rest of everybody’s as to how do we do something about that.
There is one thing, for anybody who has been in this space for a long time,
which most of us in the room have, since vendors and others are not covered
entities, it is one thing to say that HHS should, or NCVHS should, or something
else, but I would say they cannot. With the regulations right now, they are not
The other thing, though, that I would like insight from all of you (about)
is we act like that’s a comment and these people are from another planet. I
mean these people are in the rooms in WEDIs, they are in the rooms in these
other organizations, and then we come into other places and go, What’s going
So there is no question out of this. CMS said they’re going to step up, and
CMS is in a position to make sure that other payers step up. Providers are
caught a lot of times by their vendors. So rather than somebody should, how —
we’re talking about outreach to Medicaids, and we talk about other stuff, which
we heard a lot of yesterday, and there’s a lot of people doing it, and there’s
a lot of people — but this vendor word keeps coming up like it’s something
that nobody knows what it is and nobody ever comes up with a list of who is,
what’s the topic list and how do we do something with them, and how do you
group up. In meetings you’re in, there’s a lot of people who appear to be
vendors, but you can’t — there’s no vendor. It’s a word, it’s a philosophy.
Well, it sounds like it’s going to be an even more important issue, just
using your dates, not using my words, using your dates. What do we do? What do
we do as an entire group? Because, remember, you’ve got to remember the rule is
they’re not covered and so they don’t have to do certain things at certain
times. But that appears to be a linchpin that we can’t get hold of. We seem to
be able to get hold of everything else in one way or the other, but that one
just keeps being a word, not an action, not a group, not a structure. It just
keeps being a word.
MR. HAFNER: I would like to take that one, Harry. Before 4010 came around,
there was a lot of pressure from providers putting on practice management
systems and hospital management systems to have 4010 capabilities. It actually
made those vendors put out adapters, if you will, or add-ons to their packages
so that they could actually perform that. In the past it was doing NSF or some
older flat files, and they actually were encouraged to do 4010.
4010A came out a little later. Those vendors didn’t go through it a second
time. They made deals, for the most part, working with clearinghouses.
Clearinghouses would go ahead and give some royalties back to those practice
management systems, and people would get compliant.
But I think the most important lesson from that story was that we were able
to inspire market pressures by encouraging the providers to go to their
vendors, encouraging the payers to go to their adjudication system vendors and
their translators and all and make them work out. If they didn’t, there is a
market, of course, that you could switch vendors.
So I would say if there is a way that we can somehow inspire those providers
and payers out there to put market pressure, market demands, on those vendors,
we would have a chance. That is what you have done in the past.
MR. REYNOLDS: Judy and Jeff, one piece of information we may want to try to
get at some point is some kind of a list by types of vendors or what percent —
how do we get to 80 percent of the industry, 90 percent of the industry? What
do you do and how does that look, rather than — we just keep using that word,
and you can’t even get a handle on are we talking about 26,000 or are we
talking about — what are we dealing with and how do you reach them?
DR. SUAREZ: You’re making a distinction between separating clearinghouses,
which are known, defined, and covered entities, and vendors, which are more the
practice-management vendors, the hospital system vendors, et cetera.
MR. REYNOLDS: Was somebody else going to answer?
MR. SINGH: Sure. I cannot comment on the motives and intent of vendors or
MR. REYNOLDS: And the question had nothing to do with motive and intent.
MR. SINGH: Yes. You know, all the pressures.
One of the reasons is every vendor, I’m sure they have their own set of
rationale on what they can or cannot do and when they can do it.
I am a true believer, and Edifecs is a true believer, in market forces and
innovation and disruption. We are an example of that.
I think what will happen is that first there are ways to solve some of these
problems by adding components together of different kinds, like people use
validation engines in addition to translation engines. So they are work-arounds
in terms of how to process some of these transactions, and also, these enabling
technologies allow you to be able to fudge a little bit, so to speak. You can
suppress, for example, errors, and you can do soft compliance.
It is not that it is advocated. Sometimes that’s a necessity. You have to do
it because of time frames, because of the time it takes to get your system
cleaned up, et cetera.
So we believe that there is a market for vendors, financial rewards and
implications for vendors, by assuring 5010 compliance. I think all of them are
incented. Let the market forces work, and I believe that if the market forces
are adequate for them, they will jump on it and move very fast.
I do not know how — and again, Harry, you are right that they are not
covered entities, so how do you enforce this on vendors and clearinghouses? But
I believe that 4010 was the first time they got encountered with this, and
therefore they were slow getting their bearings together, et cetera. For 5010,
a lot more vendors will be prepared. But let the market forces work, and I
believe the vendors will step up, they will be incented, because it falls in
line with their revenue and financial goals and objectives.
As to enforcing them, I don’t have any ideas. But from our side, we were
incented to do it, Edifecs was incented to do it, and therefore we did it, and
we did it in a very timely fashion, beginning of 2009, for all our customers
MR. CONNORS: Enforcement is one thing, but from an awareness standpoint, we
would be glad to try to work with our colleagues at X12 to try to develop some
awareness programs to try to drive some urgency in the community. So we would
be glad to do that.
MR. REYNOLDS: Yesterday we heard, and we heard it again from some of you,
that making it clear and announcing it over and over again that the date is not
going to change, you feel that is also an important situation.
MR. CONNORS: Yes, definitely.
MR. REYNOLDS: Thank you.
DR. WARREN: And I just wanted to clarify on your request, Harry. You said we
need to identify these vendors and understand where they’re at?
MR. REYNOLDS: It’s just a thought. In other words, we always just use a big
word. It will be interesting — we’ve seen a lot of surveys in the last two
days — it would be interesting to know, if you put up practice management
systems, do you need to have 700 or 9,000 to get to 80 percent of the market,
or are there 15, are there 30? Then it allows the whole industry at that point
to go out and start helping.
But just having a word and not having a list just means — it can feel like
a free-for-all. Again, it’s not personal about any area, any group, or anything
else. It just seems like a word that you can’t ever get hold of.
DR. WARREN: Marjorie?
MS. GREENBERG: I want to thank the presenters, and if one of them is old, I
guess that makes me ancient. But I remember, I would say it was 11 or 12 years
ago, when we first got involved, held hearings probably related to the 4010 and
to HIPAA, that one of the strong recommendations we heard was the need for
I remember sitting in this room — maybe it was upstairs in 705 or 703 —
but in any event, that came through so loudly, and it made a lot of sense, and
it seems that experience has shown that yes, where there are these regional
collaborations — and we’ve heard about several of them yesterday and today —
it does seem that it may also be the solution to what we were just talking
about. There seems to be a critical mass, an awareness, an understanding, maybe
a set of incentives for vendors who serve that regional area, et cetera.
So I guess my question is, what more can be done to stimulate these types of
regional arrangements or collaboratives that I would think could address a
whole range of standards and HIT initiatives that are currently being rolled
out? I wondered as part of that whether the sort of health information
exchanges and the regional approaches to the ARRA are part of this, or whether
they are focused more on the electronic health records and less on the HIPAA
standards, and if there is some way to kind of harness what regional
collaborations we have out there to try to make this work, because it really is
hard to get your hands around at a national level.
That is my major question, though I also think we need to come back to this
whole issue of their needing to be a national crosswalk between 9 and 10,
because, as we discussed yesterday, we have one, but it doesn’t seem to fit the
bill, at least from the point of view of the testimony we’ve heard. I don’t
think that it’s because it’s inadequate, but it seems that because it’s not
mandated, people are just doing their own. So that’s the second thing I just
want to make sure this subcommittee really addresses.
But back to the regional issue.
MR. HAFNER: Sunny likes me to go first.
I am going to speak from WEDI now as opposed to being a vendor. By the way,
Harry, I am a vendor, so it can go on the record.
MR. REYNOLDS: Put him on the list.
MR. HAFNER: Yes, there you go.
I believe a number of the regional collaboratives were inspired being
regional snips of WEDI. Now, not all of them but a number of them were that
way. I would say there were about 30 of them in the highlight, if you go to
MOSNIP in Missouri, and Nebraska had one, and Ohio had one. They were all over.
A lot of them have gone dormant. There are a few that are strong, the ones that
you’ve heard of yesterday, like NCHICA.
We need someone, I believe, at the government level to stress the importance
and make a statement, and then therefore WEDI can carry that forward and try to
reinvigorate those people. We know the names, we know the people who are out
there. We have a club to use, and WEDI can take it to them and try to get them
going again. We would love to do that.
MR. SINGH: I would make two points.
DR. WARREN: Can I just clarify, this is WEDI that would do that?
MR. HAFNER: Yes.
DR. WARREN: You were doing multiple hats here?
MR. HAFNER: I do wear multiple hats. Yes, I believe, though, we do need a
statement from HHS or CMS or somebody. Once we have that statement, we in WEDI
— that’s why it’s W-E — can go forward and carry forth.
MR. SINGH: I have two points around this. One is when you look at regional
collaboratives, they are very nice initiatives, and they are a very good forum
for discussing best practices and sharing your ideas and experiences.
But most collaboratives don’t survive, don’t survive over the long term, and
the reason is because it requires a commitment of leadership. So we believe
that if collaboration has to happen, it has to be top-down. It has to come from
the top and permeate through various organizations, whether it’s a NMEH or a
WEDI or an NCHICA or whatever it is. So the collaboration has to be enforced
top-down so that there is serious leadership to sustain those initiatives.
Number two, let’s look at Y2K. I think people complied with Y2K. I think
people were able to handle the year 2000. Why was it such a huge initiative,
and people were able to comply with it — yes, they knew for some time that Y2K
was coming, but they were predominantly back-loaded. A lot of people did work
in the last two or three years, and it got accomplished. It got accomplished
because the enterprises themselves took it upon themselves to have hard-core
plans because they knew it was a do-or-die date, and they put the necessary
resources to make it happen.
So again in health care I think the powers-to-be at the highest level can
enforce it and enforce deadlines, and that’s a good thing. That leadership
should come. But at the end of the day, the healthcare organizations,
predominantly the payers, will have to be aggressive enough and say, “This
is it. This is how we’re going to do business,” and therefore enforce it
into their trading partner communities. It is incumbent on them to show the
leadership as much as we expect anybody else to show the leadership, whether
it’s consortiums and monitors getting together, or we can keep going after CMS
and other government agencies. At the end of the day, it is the people who are
the payers, provider set, but the payers are the main people, I think, and the
big providers, the very large providers are the people who should really show
the leadership and show something a la Y2K. I think that would be the most
But in the end I believe that consortiums and monitoring organizations are a
great way to get educated, to exchange best practices, to exchanges their
thoughts and experiences, which is very, very relevant.
MS. GRAEFF: I would just add that it is true historically that large
dominant payers have ended up leading these collaborations or these regional
consortia, and some have gone dormant and will rise again.
But in many states, the large dominant payer is the Medicaid program. In the
case of Medicaid, I think we may very well have opportunities under ARRA and
the Health Information Exchange and the Medicaid state HIT plans to be able to
help leverage some funding that’s available to help Medicaids to take that
leading role in those states that don’t have a leader of the band.
DR. WARREN: My turn to ask a question. One of the things — this is for
Cathy — when you were surveying the states, I noticed that you had like a 50
percent return rate. Yesterday we have CMSO that is planning to put out a
survey to see where the states are. So what I am asking you is, is there a way
that we can assist that effort so that we can get a much higher return rate
than 50 percent? I am concerned about getting the data and helping people out.
MS. GRAEFF: Sure. I think the 50 percent return rate could have been higher
if, number one, we had promoted the fact that we were doing a survey and had
more time to promote it, because we were doing it in anticipation of this
testimony, and so there was a short string on it. We weren’t able to go through
multiple channels to promote the fact that a survey was being done. So I think
the lower response rate was partially due to the shorter time frame.
Secondly, because it is early and we did have large responses, 30 percent
responses saying it’s too early for me to have an opinion or for us to tell, I
think some of the too-early-to-tell people didn’t bother to respond at all.
DR. WARREN: All right. So following up that, maybe part of the promotion of
the survey should be an awareness itself, especially to the people that you’re
talking about, because we need that information as well?
MS. GRAEFF: The awareness needs to be stepped up, especially at the
executive level, the management level, within the Medicaid agencies. There’s a
lot going on out there, and —
DR. WARREN: That was my concern. We’ve heard about multiple surveys, and so
people will start being surveyed to death and won’t answer those, and then we
don’t have the data.
MS. GRAEFF: Yes, that’s exactly right.
DR. WARREN: My second question really follows up on Marjorie. I guess,
Sunny, this is for you. You talked about inconsistent crosswalks, and yet we
have a crosswalk — and I’m assuming that’s a crosswalk from ICD-9 to 10 — we
have one that CMS has put on the Web site. It’s not a required crosswalk but
certainly has official status.
We are trying to understand why we still are hearing people developing their
own crosswalks when there is one that’s already there. So if you could speak to
that or how you found out about the multiple crosswalks.
MR. SINGH: The comment we made about the multiple crosswalks, that’s what we
heard from our customers, from our partner, and from the industry. Why there is
— I am not intelligent enough to make a comment on that, and therefore I will
not. But that’s what we heard in the market vis-à-vis the ICD-10 and 9
crosswalks. But I will defer to others.
MS. GRAEFF: Being a non-technical person and a clinical person, I think that
the crosswalk challenge is related to the clinical nature of the transition
between ICD-9 and ICD-10. There is a one-to-many and sometimes there’s a
one-to-none. That is a challenge with using a crosswalk for ICD-10.
This is also overall — you probably heard this yesterday — ICD-10 is
really not an IT project, and the clinical and business people within the
organizations must get involved for ICD-10 transition to be successful, and
that message is not getting to executive-level folks, and they are not planning
as they should be to get their clinical and their business people involved in
the transition to ICD-10. It is not only IT.
DR. WARREN: Actually, that is a good comment.
Did you have one, Ed?
MR. HAFNER: I do a lot of work with different payers, and also my
understanding is when we introduced ICD-10 that we were able to get a much
stronger database for our government to be able to analyze the effectiveness of
how we’re treating certain things and how we pay for certain severities and all
So using a crosswalk in production is really hurting that purpose. If we
just go ahead and say this ICD-9 code is always going to have the same severity
code using a crosswalk, it is not going to give us good data to actually build
these applications to do better pay for performance.
So I agree, crosswalks are okay for maybe converting old history, but going
forward in production, I don’t feel that it’s very strong, and so that’s why I
struggle with that.
DR. WARREN: That’s why I asked the question, is because my own work with
terminologies and stuff, there’s a such a difference between 9 and 10 that the
only reason I would see a crosswalk is so that you can still follow data from
your legacy system forward, not that you use it to help you figure out what
you’re coding today. So I am concerned that there are some misconceptions going
on, and we probably need to do something about that.
Okay, next question? Mike, Justine, and then Harry. We have a list. Okay,
DR. FITZMAURICE: Thank you, Judy.
I appreciate the testimony from all of you. It gives us great insight into
how things work and the problems you see, and then what can we do about the
problems you see.
One of them, Sunny said it’s relatively easy to game the system, the
certifying system. You manually submit transactions that weren’t really created
by your system and you get this Good Housekeeping Seal. Then the question is,
what is the Good Housekeeping Seal? It may be something in the long run, it may
mean nothing in the long run. In the short run, it may buy you time, it may buy
you business that then goes bad because you haven’t met the expectations.
So certification became what is the value of certification. Sunny then says
CMS needs to explore how to resolve the differences in these third-party
certifications. That seemed to me more a job maybe for NIST. The private sector
could get together and go to NIST and say, “Can you give us some overall
criteria, or can we get criteria from CMS, and then we’ll apply them, and you
can certify the certifiers, so we’ll look for their Good Housekeeping Seal.
Cathy mentioned the states, and the states have problems — lower tax
revenues, budget shortfalls, lack of access to expertise perhaps. So I am
wondering, how do states handle failure? When it comes up and they say,
“Well, we just can’t make the deadlines,” do they say, “Our
system pays the providers and don’t bother us, we’ll just be in our own little
silo”? Do they say, “Nobody’s complaining”? Do they dare,
because they don’t want to spoil the same water that they swim in with the
Medicaid programs, so you don’t get any HIPAA complaints coming up. How do the
states handle failure, and is there something that NCVHS could recommend that
would help the states? Yes, I know, more money, states can always use more
resources to help out because they’re really stressed. Is there anything else?
MS. GRAEFF: Actually, several people commented as it related to compliance,
“Nobody’s complaining.” In the past, when states were unable to meet
compliance dates, other covered entities hesitate to complain that the Medicaid
is noncompliant in their state. So nobody is complaining.
What the NMEH members felt was that there did need to be consequences for
the states of noncompliance. That’s saying, “I want to do my job. In order
to do my job, in order to achieve this, there must be consequences or I’m
afraid we won’t make it.”
DR. FITZMAURICE: It seems all of this is to make things more efficient so
that there’s money left over that can be used for other things. In the short
term, though, you have to spend money to make money. I heard that from
Moonstruck and Copper Pipes, so I assume it applies here. But it’s a hard thing
for states and for others as well.
I am encouraged by the fact that you’re reporting that some places are
already ahead in their planning, some places are already ahead in their
attempts to get their own internal house in order and working with partners. So
it’s the planning, it’s the collaboration, it’s the certification at this
If we have you back in six months or a year, you’re probably going to tell
us more pressing problems that really will jeopardize what we’re doing. So this
is a call to get going with the planning, get going with the collaboration, and
get going with certifying what you’re doing that you’re uniform with everyone
else and you can achieve these efficiencies.
MR. SINGH: I totally agree. In the Medicaid space, you can surely enable
collaboration because they are like-minded entities working under one umbrella.
So that is one place I think, if there is any place collaboration can succeed,
with some leadership in the Medicaid space, we can really cut the cost
significantly if best practices are shared across all the Medicaids. It’s a
no-brainer as far as we are concerned, and it can happen, and there’s a lot of
opportunity for that to happen.
DR. FITZMAURICE: Thank you.
MR. SINGH: As regarding my comment on gaming the system, it is not just
somebody creating a new transaction, but it’s when you test and certify, you
might find some errors, et cetera, which you can pretty much correct and edit
the transaction to do that. So it is a variety of things that you can do under
that umbrella that doesn’t ensure that you’re 100 percent compliant or would be
100 percent compliant under all scenarios.
DR. WARREN: Justine?
DR. CARR: Thank you, Judy.
Following on the discussion of the Medicaid programs and their funding, does
there exist a model of what are the new FTEs, infrastructure, consultative
resources that are needed to achieve this transition, at a minimum, and what do
they cost, so that the budgeting can happen?
MS. GRAEFF: The planning APD has in it that information that is submitted to
CMS for approval. So states, each individual state creates their own planning,
advance planning document that they submit for approval to CMS that has some
budget information, and then the implementation APD that must be approved by
CMS also has even additional information regarding resources.
So does that answer your question?
DR. CARR: I guess in part. I think it is we are hearing about this not just
in the Medicaid model but it’s a concept that — it’s not something that we’ve
done before exactly like this. Even the point about who is the point person who
starts the process going for a provider, in whatever setting, my own experience
is that everyone is hearing it but no one knows who starts the process, and
then just the concept of here are all the things you’re going to need to do,
and then you budget them once you know what they are. But it may just be that
I’m unfamiliar with what’s already out there.
MS. GRAEFF: Well, I think that whether it’s a Medicaid agency or any covered
entity, the process has to be started at the executive level. The executive
awareness has to be there. The executives have to sponsor — Y2K was on their
radar screen. I think in many cases, unfortunately, at the executive level,
this is not on their radar screen because there are many other things going on
DR. CARR: And I agree with you. But to the point that ICD-10 is not an HIT,
it’s sort of like the old paradigms don’t fit. The work that has to be done
doesn’t map to traditional roles. It is a lot of just multidisciplinary, and I
think that is a large stumbling block, that if it were just in one silo, if
finance could do it or HIT could do it, IS could do it, it would be done by
now. But the fact that it is multidisciplinary and there are new roles I think
is a large challenge for organizations, even where there is awareness at the
DR. WARREN: Harry, you have the last question.
MR. REYNOLDS: I’m going to play a little bit off of Justine’s. Cathy, in
making your comment, I appreciate it, but the problem is, who is that person
that starts it? I agree with that, and I think that’s big thing.
But most of you a lot of us have dealt with in the testing all along, and
you guys have done a great job, but you really in many cases only really helped
test the front end and helped test the back end. The playoff, Justine’s
comment, this is going all the way through and it’s going through bigger,
badder, and deeper than we’ve gone before.
What are the tools that you’re thinking about, what are the structures
you’re thinking about? What are the things you’re going — because, again,
playing off of Justine’s, if a company hasn’t even done this to themselves in a
while, the word “testing” — you guys are a great help front and back
in many cases, but how do we help them think about the issues in the middle?
We’ve heard some stuff on that and a lot of good presentation. But how do you,
from the standpoint of being the testing group, help start putting out some
collateral, doing something else to help people think that — because if I saw
a test plan of what I had to do, I might all of a sudden realize who I ought to
put on it and what I ought to do and what ought to happen in my area, and I go,
“Whoops, we don’t have somebody who can answer that.” Sometimes it’s
a better way to — so any comments anybody would have on that would be helpful.
MR. SINGH: What we do as a company is we have the experience that we have
garnered and gathered over the last many years, both 4010 and 5010, which has
become part of what we call our templates. We have a center of excellence
around design, implementation. We have standardized templates, standardized
test plans. So we have a lot of this collateral that we share with our
customers and our partners on how best to accomplish the various tasks around
whether it’s testing, going into production, monitoring, the whole nine yards.
In addition to that, as we are doing more and more implementations, we are
also getting better acquainted with the ground realities that these
organizations, our customers, are facing. We genercize it and then we share
that with the collective sum of our customers.
So not only the historical perspective we have but the day-to-day
perspective, every day as we are learning more and more stuff, we are sharing
that across the minds, the intellect that we have within the company. So that
is what we are doing, and we have a pretty rich inventory of things that we
share with our customers. Some of them I just named. But we have a pretty rich
It is very interesting that what we also hear from our customers is that
they’re interested in knowing what other customers are doing. They are asking
us proactively. They are actually reaching out to them proactively and saying,
How are you doing? So whether we are the medium or they just know each other
through the network, they’re asking them and seeing how these problems are
So I think the sum total of it, when this becomes serious enough where
people are focusing on it, they reach out, whether to us as a vendor or to
their other peers in the network, et cetera. So that effect is there.
MR. HAFNER: I think it’s a very good question. I think that when we started
off with 4010A, we focused on syntax. Send a file — you could even type it up
and fake it, send it out to the certification site, and you get results back
and it would tell you if you passed that file or not.
Foresight went after a model where we wanted to be payer-centered. In other
words, the payer would go ahead and say, Well, we just don’t want to send
compliant data; we want you to make sure you send in a coordination of benefit.
Show me that you can go ahead and send in a claim with an ambulance claim
that’s a round trip. Show me that you can do these sets of diagnosis codes.
So we’ve learned that what we needed to build into our systems was
application scenarios so that they couldn’t fake it out. Their applications
actually had to generate it. So when we test the front-end or the back-end
systems, whether it’s the payments coming back or the claims coming in, we look
for certain characteristics in that file to be able to see if it meets those
So when Jerry mentions DISAcert and they’re looking for scenarios, they are
actually looking for certain application examples that are inside that data
that will actually exercise what needs to be done for 5010. So I think that
makes you have to exercise.
We have also done some round loop tests, when we would send in a claim and
the payer would have to respond back with a response with the payment or send
an eligibility request and the eligibility response comes back.
So I think we all are evolving into getting deeper than being
front-end/back-end but exercising those applications.
MR. REYNOLDS: Thank you. Thank you, Judy.
DR. WARREN: I want to thank the panel for some very thoughtful information
Let’s take a break, if everybody could be back at 10:40.
DR. WARREN: In panel 6 we are going to hear from health plans and providers
and what they’re doing with these two initiatives.
Our first speaker is Nancy Spector from AMA, followed by Holly Louie from
HBMA, and then Sidney Herbert from AHIP and George Arges from AHA, which shows
you we love acronyms and letters and all of that stuff. So let’s start with
MS. SPECTOR: Thank you.
Good morning. I am Nancy Spector, director of electronic medical systems at
the American Medical Association. The AMA thanks the NCVHS Subcommittee on
Standards for inviting our input on implementation strategies for the updated
transactions and code sets.
The AMA does strongly support upgraded HIPAA transactions to improve the
efficiency and effectiveness of the healthcare system. We recognize that
business needs of health care are continually evolving, and therefore the
standards through which data exchange occurs need to be continually modified
As for the move to ICD-10, we have continued to emphasize the significance
of this change for the healthcare industry. Implementing ICD-10 is not just a
technical project, as you’ve heard time and time again. It will impact many
business processes within a physician’s practice, including documentation of a
patient’s visit, research activities, public health reporting, quality
reporting, and administrative transactions.
We continue to have concerns about the cost and aggressive time line for
implementing ICD-10 in the wake of the implementation of the 5010 transactions
and other competing federal requirements and priorities.
I will begin by telling you about our outreach work for the 5010
transactions and ICD-10. For the 5010 transactions, since the publication of
the final rule, we have taken efforts to outreach and plan for physicians’
needs on the implementation work. We began by revising our Website content to
provide information on the regulatory requirement and an overview of the 5010
transactions. We intend for our Web site to be the main location for our
resources. It includes links to the CMS Web site, and we intend to promote
CMS’s outreach and education work as well.
We published an article in the June CPT Assistant bulletin, and it is
available on our Web site with the title “Seven Steps Practices Can Take
Now to Prepare for 5010.”
In August we conducted a survey of the state and specialty societies to
gather information on what efforts they were planning with their members
related to the 5010 transactions. We also considered the survey to be an
educational tool because it alerted them to our efforts and also provided them
information on what they need to be doing for physicians.
The response rate was very low. Only 18 state and specialty societies
responded. Only two of them indicated they had received any requests from their
members for resources on 5010, and 10 responded that they have provided
We intend to conduct more surveys about their activities and coordinate our
efforts with them for educating physicians.
We have held two presentations on the 5010 transactions along with the
ICD-10 topic. The first presentation was held at the CPT annual meeting on
October 16, and the second presentation was at the AMA CPT symposium on
November 12. Both presentations gave an overview of the regulatory
requirements, information on the transactions and code sets, and information on
the work to implement them.
In November we distributed the first two fact sheets in a series of six
addressing implementation of 5010. The first fact sheet provides background
information on HIPAA and the standard transactions. The second is an overview
of the tasks and estimated time frames needed for implementing those
Additional fact sheets on understanding the HIPAA terminology, identifying
the changes in the 5010 transactions, testing, and enforcement will be
distributed over the next several months.
We have developed and plan to release shortly a 5010 project plan template
resource. The template is in an Excel format, and it will be a tool that will
walk practices through the detailed activities that it will need to do to
implement 5010, and it provides estimated time frames for completing each of
those activities. It provides space for them to document the work they will
have with tracking their efforts with their vendors and clearinghouses and
payers. We consider this a complement to other resources that we already have
that support physician practices on what they need to do when they’re
considering selecting a practice management system.
We are also collaborating with other organizations throughout the industry
and are actively participating in WEDI in the work they are doing related to
Additional activities we have planned for the 5010 implementation include
developing a comprehensive toolkit of our materials, conducting surveys of
physicians to determine their readiness, revising our HIPAA transaction books,
and continuing to message on the need to be prepared for the compliance
For ICD-10, our outreach efforts have been more limited. Our intent is to
provide the complementary resources for the 5010 transactions over the next
several months and then focus our efforts on the ICD-10 resources, although we
have been combining messages on 5010 and ICD-10 when appropriate already.
After the release of the ICD-10 final rule, we did update our Web site with
an overview of the regulatory requirements and some explanation about the
changes between ICD-9 and ICD-10. Our Web site provides links to other
organizations including NCHS, AAPC, AHIMA, AHA, CMS, and WEDI, and we have
provided links to the CMS presentations and articles that they have published
so far and also links to the general equivalency mappings.
An article titled “Preparing for the Conversion from ICD-9 and ICD-10:
What You Need to Be Doing Today” is available on our Web site, and it is
expected to be published in the CPT Assistant bulletin this spring.
In the survey that we conducted in August, five of the state specialty and
state societies indicated they had received requests from their members for
information on ICD-10. Nine responded that they have provided various
resources. Again, we plan to keep working with them in coordinating our efforts
on the education.
We have been and plan to continue using various AMA publications and
communication vehicles to provide information on the ICD-10 implementation as
well as 5010. As I mentioned before, we had the two presentations that included
both 5010 and ICD-10 information.
We are engaging in industry activities related to the implementation of
ICD-10. We have reached out to many organizations one on one that are necessary
partners for ensuring a successful transition. On December 4 we hosted a
stakeholder meeting with several of these organizations: Blue Cross Blue Shield
Association, AHIP, American Clinical Laboratories Association, American Dental
Association, HIMSS, the Healthcare Billing and Management Association, National
Council for Prescription Drug Programs, MD-On**, SSI, MGMA, AHA, AHIMA, and
AAPC. The meeting was the first of what we hope to be many in which industry
leaders will come together to discuss the concerns and barriers we are facing
with implementing ICD-10, and we hope to work together as a group to develop
consensus approaches to solving issues we encounter.
Throughout 2010 we will develop more resource materials that will be
distributed to physicians and the state and specialty societies. We intend to
develop an ICD-10 fact sheet similar to the one we are doing for the 5010
implementation. Topics for that will be an overview of ICD-10, the regulation,
comparison of ICD-9 and ICD-10, crosswalking in the GEMs, ICD impacts on
practices, testing and system changes for ICD-10.
We plan to develop another ICD-10 implementation project template like we
did for 5010. Again, we are going to combine all these resources into one big
toolkit that we can provide.
We are also planning, we are doing some early stages with developing an
ICD-9/ICD-10 electronic conversion tool that would be specific for meeting the
needs of physicians. We have seen some others that have been done, but we are
looking at something that we could do that would more specifically meet the
needs of physicians.
We are also looking into developing a webcast series that will take all of
these different pieces that we’re developing and provide that to physicians.
So we will continue to look for new opportunities and methods for our
outreach and education, and we welcome any suggestions that you or others may
have for us.
Now I am going to talk about the barriers to implementation. A year ago, if
you had asked about barriers to implementing 5010 and ICD-10, we would have
talked about just the inherent complexities of undergoing two large system
changes within a relatively short period of time among physicians, other
healthcare providers, payers, clearinghouses, and vendors. And if that wasn’t
enough, physicians are facing other major priorities with imminent deadlines.
Meaningful use for electronic health records, additional HIPAA security and
privacy requirements resulting from the passage of the American Recovery and
Reinvestment Act, and e-prescribing are a few of these other priorities.
It is important to note that all of these new federal mandates and
priorities compete for the same physician, clinical and administrative staff,
and financial resources.
Cost is always a barrier to implementing changes in physician practices.
Today physicians are faced with continual decline in their reimbursement.
Without a fixed and Medicare-sustainable growth rate formula, physicians face a
21 percent cut in payments on January 1. Physicians who have not adopted
e-prescribing systems face a 1 percent payment penalty starting in 2012,
increasing to 2 percent in 2014. In 2015, physicians who have not adopted an
EHR system that meets the meaningful-use criteria will see a 1 percent decrease
in their Medicare payments, and this will rise to 3 percent in 2017.
A study conducted by Nochumson(?) Associates released in October 2008
indicated that the first-year cost of implementing just ICD-10 in a typical
small physician practice with three physicians and two administrative staff
could be as high as $83,000. As with all of the mandates, we are concerned
about physicians realizing the return on investment that is projected with each
We are concerned with what appears to be a lack of coordination among the
various government bodies as to what requirements they are imposing, how the
deadlines for the requirements are converging, and the impact they are having
on physicians. So we urge NCVHS to recommend to the Secretary that one entity
within the government track the various requirements and make recommendations
to the appropriate overseeing bodies about the realistic time frames for
sequencing and completing all the incentive or penalty programs and mandates.
As to the issues identified with the adoption of the HIPAA transactions, our
vision is to see physicians have access to necessary administrative information
before or at the time of the service. Enforcement of HIPAA transactions and
code sets needs to ensure that covered entities comply with all transaction
guide instructions and that data is reported accurately into the highest level
of specificity available, not just to be syntactically correct.
Until the information being conveyed electronically eliminates the need for
follow-up phone calls and other manual processing, administrative
simplification will remain an unfulfilled promise.
We have been involved with X12’s work on healthcare transactions for many
years, although our focus has been primarily in the claims-transaction area. In
recent years we have begun to work more closely on the other transactions, like
the eligibility and remittance advice, and we are finding the need for more
specific information that is not present or not required in the 5010 version of
these transactions. We do intend to work with X12 to have these necessary
changes that we’ve identified made in the next version of their transactions.
But meanwhile, under 5010, physicians will not have the fully automated
revenue-cycle system they desire, so we do see this as a barrier to physicians
adopting the HIPAA transactions who have not already adopted them.
As for priorities for physicians during the implementations, we see three
key priorities. They are working with their vendors, working with their trading
partners, in coordinating other EDI requirements. Physician practices are
largely dependent on their vendors to provide them with any necessary system
and/or software upgrades they need, and physicians do need to be contacting
their vendors early and have a clear understanding of what will be happening
with their system upgrades. I know we’ve had a lot of discussion in the last
panel about vendors, so again we’re bringing that up as an issue.
The second priority for physicians is to work with their trading partners.
The transition from 4010 to 5010 will require a well-choreographed effort by
all involved. Not all trading partners will be ready to exchange 5010
transactions or transactions containing the ICD-10 codes at the same time.
Physician practices will need to conduct testing with potentially dozens of
trading partners. This work alone will take many hours of the practice’s staff
The testing involves communicating with the other entity to set up the
testing, generating and sending the test transactions, reviewing the received
test transactions, and reviewing reports on the testing to identify any issues
that may have occurred. A concern is that the work to complete the testing will
be too complex for a practice and it will simply overwhelm them. This could
result in testing not being done, issues with the systems not being addressed,
and the inability to send and receive 5010 transactions or ICD-10 codes at the
time of the compliance deadlines.
So the AMA strongly recommends that CMS and other payers communicate early
and often with the physicians with whom they contract on the need to test the
5010 transactions and ICD-10.
We also request that the clearinghouses and payers develop simple testing
procedures that will reduce the burden on the physician practices. We hope that
straightforward and thorough guidance can be provided to the industry on how to
complete the large tasks of transitioning first to the 5010 transactions and
then to ICD-10. From the last panel on testing, we’ve already talked about some
of the recommendations out of there, but we are glad to have that conversation
being held now.
Finally, practices need to take this time to consider all of the various EDI
requirements. They need to understand how their current system will accommodate
not just 5010 and ICD-10 but also meaningful use, security and privacy,
e-prescribing, quality reporting, and any other priorities that come along. The
worst that can happen is for practices to go through the time and expense of
upgrading their systems to meet 5010 transactions and ICD 10 only to find out
that they are unable to meet the other requirements.
As for risk areas with implementation, we believe there are several risks
that must be overcome to ensure successful transactions. Our first concern is
with vendor readiness. If the vendors do not have their products ready early
enough or do not complete their installation work in time, physicians’ systems
simply will not have the capability to send and receive the 5010 transactions
or ICD-10 codes. Physicians cannot receive their upgrades just in time for
compliance deadlines; they need the upgrades completed well in advance so they
can complete internal and external testing to ensure that the transactions will
work properly. For the same reasons, payer readiness is just as critical.
A large and more widespread risk with implementation is the ability for
everyone to handle processing of 4010 and 5010 transactions at the same time.
Not all entities will be ready to transition to the 5010 transactions at the
same time, and if a practice’s system is unable to do dual processing or if any
of their trading partners are unable to, the practice will need to decide if
they wait until one date to move to the 5010 transactions for all of its
trading partners; alternatively, the practice may need to migrate to 5010 for
those trading partners that can process them and use a clearinghouse or drop to
paper and manual processes for those trading partners that are not yet ready
for 5010, which would be an overwhelming burden on the practice. We see this
migration process as being very complex and will require good communication and
coordination among all trading partners.
As of January 1, 2012, there is a risk that not all of the industry will be
prepared to send and receive 5010 transactions. If any of a physician’s payers
or clearinghouses are not ready, the physician will have to work with them to
determine what process will be taken in order for the claims and other
transactions to continue to flow through the system. Again, we want to avoid
having to drop to any kind of paper or manual processes during this time.
The lack of readiness will also likely impact timely payments to physicians.
We intend to message to physicians to establish a line of credit prior to both
the 5010 and ICD-10 compliance deadlines in case there are disruptions in their
cash flow as a result of claims that are not being processed.
As we learned most recently with the national provider identifier
implementation, there is a strong likelihood for claims processing and cash
flow interruptions. With NPI, an untold number of physicians did not receive
Medicare reimbursement for months, causing severe financial hardship. The AMA
strongly recommends that NCVHS recommends that NCVHS recommend to the Secretary
that Medicare create clear guidelines on cash advances and that the policy be
made widely available to all physicians.
A related issue is the non-covered-entity status of the property and
casualty and workers’ compensation industries. We are hearing that many are
unlikely to covert to using ICD-10, which means that physicians will need to
maintain the ability to code these claims in ICD-9, which will place another
burden on them. We are raising this as a concern and recognize that there would
need to be statutory changes to require these non-covered entities to comply
with the transaction and code-set regulations.
Another concern we have is about how the ICD-9 and ICD-10 codes will be
mapped to one another. Our understanding is that the GEMs provide a basic map
between the ICD-9 and ICD-10 codes, but entities, mostly payers, may have their
own maps for matching ICD-9 and ICD-10 codes, particularly where there are
If payers develop their own maps to do this, each player may map the codes
differently. Physicians may then bear the burden of having to know which codes
to submit to different payers. We also have heard that some payers will not be
converting their claims-processing systems to ICD-10 in time for the compliance
deadline. Instead, they will take in the ICD-10 code from the physician and
crosswalk it to an ICD-9 code to send the claim through their processing
We are still exploring the issues with crosswalking and mapping and the
impact that it will have on physicians. But at this time the AMA urges NCVHS to
recommend that a single mandated map be named for use by all covered entities
in the industry.
We are also aware that there are numerous business process changes that will
need to occur with the implementation of ICD-10. All will take time and
resources for physician practices to understand and implement and have the
potential to complicate and disrupt the claims-payment process.
In conclusion, the AMA appreciates the opportunity to participate in these
hearings and is pleased to see NCVHS taking an early and active initiative in
understanding the industry’s progress and key barriers with implementing the
ICD-10 code set and 5010 transactions. A transition of this magnitude will
require a workable implementation process and time line for all covered
entities and their trading partners and comprehensive outreach and education
initiatives to support healthcare providers, especially small physicians,
through this complex and costly move to 5010 and ICD-10.
We look forward to providing further input on this important work in the
DR. WARREN: Thank you
Holly Louie from HBMA.
MS. LOUIE: Good morning.
Madam Chairman and Mr. Chairman and members of the National Committee on
Vital and Health Statistics, I would first like to say I am glad this isn’t
school anymore because I think we would all be accused of copying each other’s
My name is Holly Louie and I am a board member for the Healthcare Billing
and Management Association and co-chair of our ICD-10 task force. On behalf of
HBMA and the more than 600 companies that belong to our association, I want to
thank you for the opportunity to present our views on the planning and
implementation of the updated HIPAA transaction standards and code set, Version
5010, and ICD-10 CM.
HBMA has been and continues to be a strong supporter of the move to more
advanced and comprehensive electronic claim transactions.
As requested, I will go through each of the questions you have asked us to
• What is the current state of planning for 5010 and ICD-10 in our
HBMA has been encouraging billing companies and their clients to prepare for
both the 5010 and ICD-10 transition for several years. We have conducted
numerous educational programs at our annual meetings, provided focused topical
sessions, published articles in our monthly journal Billing, and
conducted webinars on these topics. We also have a dedicated Web page and links
to AHIMA, CMS, and other relevant resources.
In addition, earlier this year, HBMA created our ICD-10 task force as a
means to bring together various entities involved in the healthcare transaction
chain. The purpose of the task force is to address the myriad issues involved
in moving from both 4010 to 5010 and ICD-9 to ICD 10.
Our task force is a multidisciplinary group of billing companies, software
vendors, health plans, physicians, coding experts, clearinghouse
representatives, and other entities involved in claims submission and
During our regular conference calls, we have an open dialogue with the
software vendors and clearinghouses to determine their readiness for both 5010
and ICD-10 implementation. One of our members is a member of WEDI, and we
receive regular updates on their work and recommendations. We discuss steps
billing companies can take to make sure their staffs are appropriately trained
and prepared for ICD-10 implementation.
Although we are confident that most billing companies will be prepared for
the transition to 5010, it must also be noted that, like most physicians, we
are largely dependent upon our vendors — there’s that word again — and
clearinghouses to actually be able to submit claims using the 5010 standards.
The software vendor and clearinghouse communities have assured billing
companies and our physician clients that they are or will be ready. But without
testing, we truly do not know. While we are confident that most vendors and
clearinghouses will be able to meet the technical requirements of 5010, the
actual operational implementation of 5010 throughout payment systems is another
We have encouraged our member companies to begin testing as soon as it is
offered by their vendors and available with insurers so they can evaluate the
effect on their organization.
If past is prologue, we anticipate significant delays with the processing of
claims in the initial phases of testing and implementation and therefore
strongly recommend that testing begin as soon as possible. Once testing does
begin, the more comfortable we will feel about the ability of the industry to
meet the deadline.
With regard to ICD-10 planning, we believe again that most billing companies
are as prepared as they can be in 2009 for the 2013 deadline. We are, however,
very concerned that many billing companies, physician practices, and
third-party payers may rely upon computer programming crosswalks rather than
the intensive education and training required to comply with the ICD-10
• How are other priority initiatives and the current state of the
economy affecting our planning and implementation?
Although health care is sometimes described as a “recession-proof”
sector of the economy, the staffing budgets and financial resources of most
healthcare organizations have receded noticeably since the third quarter of
2008. Concurrently, healthcare organizations have also pared back on their
information technology-related projects, in part due to budgetary and
Even in the best of times, the transition to 5010 and ICD-10 would be both a
functional and economic challenge. Undertaking this transition at a time when
the economy is in the worst shape in several decades, new federal incentives
for EHR and mandates for meaningful use are pending, and the fact that Congress
is considering major changes to our nation’s healthcare delivery system could
amount to the “perfect storm” in American health care.
We are finding that many physicians simply do not have the financial
resources to undertake the types of changes they are facing. Physician payments
under Medicare have not kept pace with inflation, and even as we meet today,
physicians are looking at the prospect of a 21 percent reduction in Medicare
payments in 2010.
We project little to no growth in physician payments for the next few years.
Consequently, budgets will become tighter and tighter and physicians will be
looking for ways to reduce overhead costs, not to absorb new ones.
The most conservative estimate of an additional 4 percent of their
income dedicated to 5010 and ICD-10 implementation cannot be taken lightly.
Billing companies, like most other businesses, are not immune from the
economic problems confronting our nation. Most billing companies are small
businesses employing fewer than 25 employees. The credit crisis and depressed
business cycle have affected our members as well.
Should the confluence of various events come to pass — 5010 adoption,
ICD-10 conversion, healthcare reform, mandatory use of EHRs by physicians, and
a widely recognized national shortage of physicians — we are concerned that
many physicians will simply throw up their hands in frustration and leave the
practice of medicine or aggressively eliminate or restrict the most
operationally problematically insured patients. Limiting or non-acceptance of
Medicaid and Medicare patients is already very prevalent in some areas of the
Billing companies will continue to plan, and our task force will continue to
meet. HBMA will continue to provide educational programming through all of its
forums. We are committed to providing billing companies and their physician
clients with the most cost-efficient solutions for meeting the 5010 and ICD-10
• What issues or concerns have we identified for our industry regarding
the transition to the updated standards, and how have they affected our
progress or efforts; and how do those issues compete with other implementation
As you may recall, in 2007, HBMA testified before the NCVHS Standards and
Security Subcommittee. We were asked to address various issues associated with
the transition to new standards.
I will paraphrase what HBMA had to say at that time: When the 4010 standards
were announced several years ago, they were initially greeted by our industry
with great fanfare. Finally, we would be creating a uniform platform for
Unfortunately, our euphoria over the adoption of 4010 was very short-lived,
as a new term entered the medical billing lexicon: companion guides. Soon every
third-party payer, including Medicare, announced the development of companion
guides to accompany the 837: 4010A1. The different ways third-party payers
wanted you to organize the information on the 837 were as numerous as there
At one point it was estimated that there were more than 1,200 companion
guides published by the various third-party payers. As Yogi Berra would say, it
was “déjà vu all over again.”
So what has changed since those concerns were raised nearly two-and-a-half
years ago? Well, we still have companion guides, but now instead of 1,200 it is
estimated there are more than 1,400.
The fact is the term “standard transaction sets” is a complete
misnomer. Companion guides circumvent standardization and impose requirements
for widespread, highly idiosyncratic electronic claim submission requirements,
at great cost, I might add.
Today we ask the same question we asked in 2007: Will the adoption of the
5010 standards eliminate the use of companion guides? Unfortunately, the answer
today is the same one we received then: No.
We remain concerned that adoption of the 5010 standards will result in
higher costs to both billing companies and medical practices, with little or no
improvement in practice efficiencies.
Similar questions must also be asked of the transition to the use of ICD-10
codes. Before getting into the business issues involved in using the ICD-10
codes, I do want to take this opportunity to encourage the NCVHS to support a
temporary freeze in the issuance of new ICD-9 and ICD-10 codes.
In a letter to CMS this past September, HBMA recommended that both ICD-9 and
ICD-10-CM (sic) codes should be frozen in October 2010. Our rationale for this
recommendation is laid out in our written testimony.
Also, we are very concerned about reports that many payers do not intend to
modify or update their claims-processing and claims-adjudication standards to
reflect ICD-10 coding. Instead, we are being told plans will use crosswalk
software to convert the ICD-10-coded claims to ICD-9 codes, apply existing
ICD-9 adjudication standards, pay the claim based upon those old standards,
convert the claim back to ICD-10, and transmit the payment to the provider.
If this is true, the problems with this approach by the payers are
monumental. If this type of crosswalking occurs, providers have no way of
knowing how a third-party payer will crosswalk the ICD-10 code back to an ICD-9
code or whether comparable payments will be made.
Although the CMS GEMs project demonstrated successful mapping for Medicare
inpatient DRG payments, that is a tiny set of the world in reimbursement. No
comparable demonstrations have been conducted for physician payments, for
specialties Medicare normally would not have a high volume of, such as
obstetrics and pediatrics, and there has been no comparable demonstration as
far as we know for the Medicaid programs or the commercial payers.
We believe consideration should be given to establishing crosswalk standards
so that when a provider submits an ICD-10 code with the expectation that it is
equivalent to an old ICD-9 code, the health plan, in applying their crosswalk,
would arrive at the same conclusion and the same payment.
• What are the key priorities for providers while planning for and
implementing the transaction standards and ICD-10 code set?
First and foremost, trying to determine how to pay for the costs associated
with both the 5010 and ICD-10 transitions. Where does the provider find the
money to do the staff training required? Where does the provider find the money
to pay for the new software and/or complete new systems that will be required?
As I noted earlier, how does the provider continue to survive financially in
the event there are cash flow disruptions associated with either the 5010 or
the ICD-10 transitions?
Second, testing, testing, and more testing. We can have all the assurances
from vendors, billing companies, clearinghouses, and payers, but until we can
actually start testing with health plans, we have no idea how many problems we
are going to need to work out.
A planned, phased, measurable analysis should be mandatory, not a rush to
the finish line and then hope it all works out okay.
If you go onto the Internet, you will see various software vendors have
announced within the past few months that they are ready to test. We would ask,
test what and with whom? I can test all I want to see that the new software
will generate a 5010 technically correct claim, but until I can actually submit
a test claim to a third-party payer, that is virtually meaningless.
Finally, we cannot overlook the fact that not all payers are covered by the
HIPAA’s transaction standards. Liability insurers, such as workers’
compensation, auto insurance, and tort liability plans are exempt from HIPAA.
Many of these plans have already said they have no intention of voluntarily
complying with either the 5010 or ICD-10 standards.
We have been questioned and/or told by CMS that failure to maintain ICD-9
should be a deterrent to this, but it will not be. There are still payers still
using the old California Relative Value Scale, which is older than I am, and
that’s a lot. Many of them use CPT codes that are years outdated and ICD-9
codes that still only have three digits. So we do not see that this will be any
semblance of a deterrent.
This means that physicians and/or billing companies will have to maintain
redundant systems in order to be able to continue to submit 4010 and 5010 and
ICD-9 and ICD-10, and that exacerbates the cost dramatically. Thus, instead of
5010 replacing 4010 and ICD-10 replacing ICD-9, they are just additional costs.
• What plans are business associates and vendors making to ensure the
compliance of their clients? What are the barriers?
In many respects, billing companies and physicians are the proverbial
“men or women in the middle.” We are largely at the mercy of software
vendors and third-party payers. HBMA can do everything in its disposal in terms
of prodding, urging, and recommending that billing companies and their
physician clients undertake all of the steps necessary to be compliant. But if
the vendors fail to meet their obligations or the health plans fail to fulfill
their obligations, no amount of training, education, or preparation by
physicians or billing companies can make the system work smoothly.
We do believe this process must be done in a much more organized and
rational fashion to avoid some of the problems with previous implementation
• What are the key risk areas for 5010 and ICD 10?
As we have previously mentioned, one of the major risk areas is financial.
Where do providers and billing companies find the capital necessary to
undertake both 5010 and ICD-10 changes that are required?
We are far less concerned about the ability of physicians and/or billing
companies to obtain the training necessary to appropriately use the ICD-10
codes. Organizations such as the American Academy of Professional Coders, the
American College of Medical Coding Specialists, and the American Health
Information Management Association all have undertaken aggressive programs to
ensure an adequate supply of highly trained coders.
There is also the risk that practice cash flow will be adversely affected by
these transitions. A delay in payments of a few weeks to a few months due to
inappropriate denials or electronic communication problems could put many
medical practices at significant financial risk.
We anticipate that many billing companies will see their margins decline as
they will have to hire additional staff to resolve problems. These are costs
that will not easily be passed through to physician clients, and we hardly
expect health plans to reimburse costs we or physicians experience due to
Finally, as you may know, a few weeks ago the Centers for Medicare and
Medicaid Services published a request for information asking a series of
questions about HIPAA enforcement. As we considered CMS’s RFI, we sought to
determine the full scope of insurers’ compliance with the accepted HIPAA
transactions currently in effect. We sought input from the Cooperative
Exchange, the clearinghouse industry trade association. They were able to
provide a very detailed map of nearly 1,700 different insurance plans and which
of the transactions they supported.
The summary statistics are provided in Table 1 of our testimony. We believe
the data confirms what HBMA’s members have observed since HIPAA 2 CS was
implemented. Insurers support the transactions that lower their own operating
expenses, receiving claims via the 837 transactions, but largely fail to
support transactions that help providers lower their operating expenses.
The overall conclusion is that active support of HIPAA transaction codes is
far from widespread, despite years of opportunity to implement.
Table 2 shows the number of insurers that support a given total number of
transaction types. Virtually none support every form of HIPAA transaction.
Further, 56.4 percent support only one of the 12 transaction standards, and
88.2 percent of insurers support no more than three of the transaction types.
Those of us who are in the business of handling and processing medical
claims are concerned that the same level of support and compliance we are
seeing with the current standards will be reflected in the new standards. In
other words, the physicians and billing companies will do everything to comply
with the 5010 and ICD-10 standards, at considerable expense, but their payers
will once again find ways to circumvent the law. This cannot be allowed to
After listening to yesterday and today’s testimony, we believe a recent HBMA
survey is very relevant to this committee, and we will submit those comments in
On behalf of the Healthcare Billing and Management Association, we
appreciate this opportunity to share our views with the NCVHS, and I will be
happy to answer any questions that you may have.
DR. WARREN: Thank you, especially for the offer to share the results with
us. That would be very, very helpful.
Our next speaker is Mr. Herbert.
MR. HEBERT: Good morning, Dr. Warren and Mr. Blair, members of the
Subcommittee on Standards.
My name is Sidney Hebert, by the way. That’s quite all right, it’s often
mistaken. I am a project director for Humana, Incorporated, with the primary
responsibility for assisting my company with the implementation of the revised
HIPAA electronic transaction standards and ICD-10 codes.
Humana is one of the nation’s largest publicly traded health and
supplemental benefits companies, with approximately 10.3 million medical
members and 7.3 million specialty-benefits members. Humana is a full-service
benefits solutions company offering a wide array of health and supplemental
benefit plans for employer groups, government programs, and individuals.
I am also providing testimony today on behalf of America’s Health Insurance
Plans, AHIP. You may know AHIP as a national association representing
approximately 1,300 health insurance plans that provide coverage to more than
200 million Americans.
AHIP’s member health insurance plans offer a broad range of health insurance
products in the commercial marketplace and also have demonstrated a strong
commitment to participation in public programs.
I want to thank the subcommittee for the opportunity to testify today
regarding efforts by Humana and other plans to adopt the new HIPAA standards
and code sets. Our industry processes millions of claims, eligibility requests,
payments, and other administrative and clinical transactions on a daily basis.
The migration to the upgraded HIPAA electronic transaction standards and the
ICD-10 code sets will have a major impact on the business and administrative
operations of health plans and will require significant financial and human
resources for successful implementation.
My testimony today responds to the questions raised by the Subcommittee on
Standards concerning implementation of the updated HIPAA electronic transaction
standards and the ICD-10 code sets by health plans and the potential barriers
to the adoption of these changes.
In addition, I will share recommendations on how the healthcare community
can work collaboratively to meet the compliance deadlines.
To address the current state of implementation planning, from a Humana
perspective we’ve completed our proof-of-concept planning and technology
selection for implementation of Version 5010 standards and will begin working
with our trading partners on migration to the new standards in the fourth
quarter of next year. Humana conducts almost all, or roughly 90 percent, of
electronic healthcare transactions with fewer than 10 trading partners.
In addition, we are assessing the potential impact of implementing the NCPDP
D.0 standards for our pharmacy transactions and are waiting for our primary
pharmacy claims processing partner to complete their implementation of the
standards in order to conduct end-to-end testing.
Humana has adopted a multidisciplinary approach to adoption of the ICD-10
code sets. We have begun planning for ICD-10 implementation and completed a
preliminary assessment of the impact on our information technology systems.
Migration from ICD-9 codes used today presents unique challenges given the
complexity of the ICD-10-CM and PCS and the extensive use of diagnosis and
procedure codes by mission-critical operational systems and analytical tools at
Humana and a number of electronic transaction contact points with our business
Our initial impact assessment is primarily based on code scans, table
structures, and does not include a review of the cost for acquisition of new
technology. The preliminary analysis indicates that full adoption of the ICD-10
code sets will impact almost all areas of Humana’s business operations and will
require dedication of considerable resources over the implementation period.
The ICD-10 HIPAA implementation will most significantly affect Humana’s
insurance product development, claims administration, clinical operations,
hospital contracting, data analytics, risk adjustment, and reporting based on
Initial estimates for our implementation cost for the updated HIPAA
standards and ICD-10 code sets indicate minimal effects on our 2010 capital
budgets due to the proof-of-concept approach we have adopted. The most
significant impacts will be on our 2010 operational budgets, due to the
extensive use of ICD code sets by our business systems and the need to involve
a full range of trading partners — vendors, clearinghouses, service providers,
and others — and operations in the migration effort, the impact on other
initiatives in the current economy, and implementation effort.
The primary issue that could influence health plan implementation activities
is the healthcare reform legislation currently under consideration by Congress.
While the scope and content of the potential healthcare reform legislation is
still uncertain, legislative proposals impose new requirements significantly
impacting health insurance, public programs, and employer-provided health
The healthcare reform proposals establish new HIPAA administrative
simplification requirements, including adoption of operating guides and
establishing business rules for HIPAA electronic transaction standards.
Healthcare reform legislation also imposes extensive mandates for health
insurers and employers, creates a new health insurance exchange covering the
individual and the small-group insurance markets, establishes rules governing
Medicare advantage plans and Medicare managed care organizations, and imposes
additional taxes and fees on insurers and insurance products. Many of these
proposed changes are effective in 2010, with full implementation required by
Healthcare reform mandates will impact almost every business,
administrative, and operational process performed by insurers at the same time
we are adopting changes to those systems required by the new HIPAA standards
and ICD-10 codes. In addition, we anticipate healthcare reform requirements
will place demands on health plan resources currently allocated to the
implementation of the new standards and codes and put additional pressure on
our ability to meet the compliance deadlines.
• The industry concerns with the implementation:
The transition to the revised HIPAA standards and ICD-10 codes will be a
significant undertaking given the complexity of the changes and the extensive
use of healthcare transactions and codes within health plan business and
Health plans need to coordinate changes to multiple systems within their
organizations and with new vendors, healthcare providers, clearinghouses, and
There are several critical issues that must be addressed to achieve
successful implementation, including testing, provider readiness, planning,
process management, and allocation of the ever-present scarce resources.
Internal testing of the new standards and codes and end-to-end testing with
business partners present unique challenges, especially in such a novel
large-scale effort. Testing required for implementation is extremely complex,
and the healthcare industry has not previously undertaken such a large-scale
Successful tests utilize on completion three key steps: One, verifying
transactions can be sent and received from trading partners; two, demonstrating
that operational and administrative systems will react appropriately when the
transaction is sent and received; and, three, validating that the right
business process decisions are made from the transactions.
The healthcare industry will need to complete large-scale internal testing
and verification and then external end-to-end testing on a relatively short
In addition, healthcare providers’ readiness must be addressed for
successful implementation. Many providers, especially small physician
practices, rely on practice management, system vendors, and clearinghouses for
their transactions. We have heard that here today.
Diagnosis and procedure codes impact every aspect of patient care delivery,
and migration to ICD-10 will require extensive changes to clinical systems and
All stakeholders, both public and private, must ensure that providers have
the necessary decision-support tools for correct claims coding and are
compliant with the new standard code sets on the implementation dates so that
the claims and other transactions can be successfully processed without
Planning and process management provide an additional challenge. The revised
HIPAA standards and ICD 10 codes are interdependent and must be adopted in a
carefully phased-in process over the next three years. Testing, vendor and
trading partner readiness, systems and business process changes, and the
internal and external education and training must be carefully coordinated. It
is critically important for the healthcare industry to thoroughly plan and
manage this process over the implementation period.
Another key consideration for successful compliance is the efficient use of
limited resources. It is estimated that the adoption of HIPAA transaction
standards and the ICD-10 code sets will require health plans, healthcare
providers, healthcare solutions suppliers, practice-management vendors, and
clearinghouses to expend tens of billions of dollars and considerable human
The implementation efforts are undertaken at the same time the industry is
dealing with other high-priority clinical information technology and business
initiatives, federal and state mandates, public program changes, and the
potential for healthcare reform legislation.
Industry and governmental stakeholders must make sure that the
implementation of the revised HIPAA standards and the ICD-10 code sets does not
negatively impact efficient or effective care delivery.
• Key priorities in planning and implementation:
As discussed before, planning and process management will be critical for
successful implementation. Planning activities should recognize that the new
standards and the code sets provide an opportunity for healthcare entities to
assess current business and clinical systems, identify inefficient and
complicated work flows, and improve administrative and care-delivery processes.
Planning must also consider ways to modernize core technology as part of this
In addition, careful planning should ensure that adoption of the new
requirements be done in a way that minimizes disruption of existing business
processes and delivery of patient care.
The technical and process changes necessary to implement the new standard
and codes must be integrated into an ongoing operational clinical system, and
scarce resources must be allocated across all business and care-delivery
Successful planning should also take into consideration all the potential
what-ifs and contingency planning. We heard earlier today that some folks don’t
like contingency planning. The industry has learned from prior standards
implementation efforts that problems will arise during and after the compliance
Besides, the complexity of the anticipated standards and code-set revisions
could potentially increase the number of transactions that are not in full
compliance. As a result, the healthcare industry must create contingency plans
and create clear expectations about how problems will be handled.
• Key risk areas. Health plans face a number of risk areas with respect
to adoption of the revised HIPAA transaction standards and ICD-10 codes. As
discussed, compliance will require allocation of significant financial and
human resources. Additional pressures will be placed on these resources as the
compliance dates approach due to the potential shortage of subject-matter
experts and the increased demand for technical and transaction-processing
vendors to assist with the implementation process.
Funding availability will also be constrained due to the cost of
implementing both initiatives at the same time.
In order to assure accuracy, health plans must mitigate risks resulting from
inaccurate coding of claims using the new code set. Accurate claim coding may
be directly impacted by the large increase in code volume and lack of
experience with the code set. This expansion in code volume may result in an
increase in errors due to lack of decision-support tools, the cost of upgrading
and migrating to practice-management systems ready for ICD-10, and delayed
engagement of the provider community in the implementation process.
Health plans must be prepared to resolve errors in payment of claims and
benefit determinations and elongated grievance and appeal resolution times.
Trading partner migration to the new requirements also poses significant
challenges. Health plans and healthcare providers are dependent in many cases
on third parties to help send and receive healthcare transactions. These
intermediaries — practice-management systems, billing services,
clearinghouses, and others — will need to be compliant with the new
requirements and demonstrate the ability to conduct transactions for successful
implementation to occur.
The goal of the healthcare industry is efficient and effective care
delivery. Compliance with the new requirements must be done in a way that is
seamless to patients, clinicians, and health planning customers.
Our recommendations for successful implementation: HHS and the healthcare
industry can work together to address the challenges and risks to
implementation of the revised HIPAA standards and ICD-10 code sets already
identified. We make the following recommendations for actions to help achieve
successful compliance with the new requirements:
First of all, ensure that current implementation schedules are attainable by
all healthcare stakeholders. Experience indicates that increased pressure will
be placed on HHS to extend the compliance dates. Firm compliance deadlines are
essential to make sure that the industry keeps moving towards an implementation
However, partial compliance by segments of the healthcare community will
elongate the time line to industry compliance, will delay the benefit
attainment, confuse healthcare consumers, and significantly increase the cost
of healthcare delivery.
With consideration for the current healthcare reform legislation that is
under way, HHS should verify the healthcare industry stakeholders’ ability to
meet the January 1, 2012, time line for adopting the revised HIPAA standards
and the October 1, 2013, date for implementing the ICD-10 code sets and ensure
the industry is ready to meet those compliance dates.
To be clear, Harry, we are saying stick to the date but make sure everybody
can be there. We had a sidebar conversation yesterday.
Secondly, share lessons learned. Health plans, healthcare providers, and
clearinghouses are already engaged in planning operational and process changes
and testing. It is critical to create a forum for healthcare payers, providers,
physicians, hospitals, and other key stakeholders to share their experiences
For example, CMS, the Center for Medicare and Medicaid Services, have
already completed steps in the planning and implementation process for the
Medicare program and should help educate the industry with what they have
learned so far.
Third, create a HHS clearinghouse to handle post-implementation problems.
Stakeholders should be prepared on the compliance dates and for a period of
time after the deadline to deal with non-compliant transactions, coding errors,
and other problems. HHS is in a unique position to create a forum for
healthcare payers, providers, physicians, hospitals, and others in the industry
to inventory, catalog, and design remedies for the unforeseen problems that
will naturally occur with a program of this magnitude.
HHS leadership during post-implementation problem management will greatly
assist the healthcare community in quickly identifying and resolving the most
troublesome problems arising after the compliance dates and will move the
industry towards realizing the benefits that will accrue from ICD-10’s
In conclusion, Humana and AHIP strongly support creation and adoption of
standards to bring a streamlined, uniform process to these transactions.
Adoption and full utilization of the HIPAA electronic transactions promotes
more efficient and effective health care.
We are committed to a successful and timely migration to the new standards
and code sets and want to thank the subcommittee for its attention to the
DR. WARREN: Thank you, and we are on to George.
MR. ARGES: I am George Arges, senior director at the American Hospital
Association. On behalf of our nearly 4,500 hospitals and healthcare systems, I
want to thank the subcommittee for allowing me to present our comments on the
preparations that are taking place for the upcoming changes to the HIPAA
transactions as well as the code set changes.
As you know, the American Hospital Association has been a strong advocate to
move our nation’s 30-year-old coding system to the new ICD-10. It is needed in
order to increase the level of understanding for new advances in medical care
and treatment as well as for biosurveillance and quality reporting.
In October of this year, the AHA basically released a briefing document that
talked about what hospitals need to begin doing in terms of preparedness for
ICD-10. It was intended to, number one, raise the awareness and to also provide
some understanding of what they need to do to basically take that awareness
into a coordinated level of action.
So we created this CEO briefing document, which I believe is attached to my
testimony, and you can look at it in more detail, but I will describe some of
the highlights of what we wanted to do with this document.
Fundamentally, as I said, it is a CEO document intended to increase the
awareness for the CEO community, making them aware of what they need to do to
basically organize the effort within their operations. It calls for them to
basically pull together a steering committee within their own organization, to
appoint a project leader to basically oversee the task at hand, and to
basically then move the operation forward. The senior management team should be
a crosswalk of various areas within the operations, from the HIN area to the
IS&T, to billing, finance, and others.
The importance of bringing together the team is for them to be aware of what
needs to take place, because this is a significant undertaking. It is one that
will require them to basically move on a lot of the changes that their areas
have to examine as part of this process.
The document also provides them with an overview of the changes between
ICD-9 and ICD-10 in terms of structure. It is important to note those because
it does affect some of their interpretations of what they need to do as well
for storage capability, system changes, as well as some of the educational
programs that will be forthcoming. So we did provide a comparison of the
structures of the two different systems.
At the same time, we wanted to inform them that this is an opportunity for
them to take a look at their own goals within their own organization in terms
of strategic planning, looking for the opportunities that they should take
advantage of as they begin to look towards implementation of ICD-10.
There are opportunities that need to be examined as part of this process. We
want them to make certain that whatever goals that they have in mind are
understood, and there are other information system efforts that are also a part
of this process that they need to be made aware of.
So the document examines some of the important implementation issues. It
looks at the overall implementation effort. It provides them with some tools
that we think would be helpful to them to organize that effort, including a
checklist of some of the things that need to be done. It provides them with a
planning and an analysis tool and reports that should be an ongoing part of
this process. All of this really should be an effort leading towards the
implementation of ICD-10 within the time line.
We tried to identify by roles within the various organizations so that the
document itself could be parsed out to the various areas within the
organization. We also provided them with a listing of resources that they can
go to to obtain the GEMs or to find other documents that would be necessary,
also pointing to them where they can obtain the 5010 transaction standards, as
well as the time line for completion. So we tried to make them acutely aware of
what has to happen and when it has to happen.
Although the time line is not until October of 2013, really, the time line
is very strict and it does require the organization to make a coordinated
effort beginning now. So this briefing is to jumpstart that process and to move
the organizations forward.
In terms of awareness, many of our hospital members are aware of the
upcoming changes to ICD-10 as well as the HIPAA transaction standards. They
indicated that they are just beginning the work. At this stage they have
assembled in many cases their steering committee, and they are undertaking the
examination of the areas that are impacted. So this is laid out, and we hope,
if they haven’t done it, that they move fairly quickly to at least accomplish
these first two important tasks.
There are some challenges that are out there. Over the past year, our nation
has seen a significant economic downturn that has made it more difficult for
our members to basically move on various capital projects. That includes IT
investments. Our members tell us that there has been significant hesitancy in
the credit markets in terms of lending money. Together with the growing number
of uninsured, this is complicating funding efforts.
The problem becomes further exacerbated when state governments, such as the
Medicaid program, find difficulty in making hospital payments for the services
that hospitals have provided to Medicaid recipients. All of these have had a
direct and adverse impact on the availability of the funds that hospitals need
and has also made it difficult for them to make the technology investments to
improve patient care and contain costs.
In terms of crosscutting and implementation issues, one of the concerns
raised most often by our members has to do with readiness of the vendor
community. Many of our hospitals utilize vendor systems in one capacity or
another, either to supplement their existing systems or to run a vendor system
in more complete efforts. Their concern is whether the vendor systems will be
ready early enough to enable them to install them, to conduct internal testing
and then perform external testing with their trading partners.
The hospital sector is relying on the vendors to deliver their product
changes within the next year to allow them sufficient time to integrate these
changes into their operations. This concern really applies to both the 5010 and
Another concern is whether the health plans are preparing their operations
for processing ICD-10. The fear that many hospitals have is that the health
plans will simply look to mappings or crosswalks as a means of basically going
back from an ICD-10 code back to an ICD-9 code rather than develop the edits
that exclusively use the ICD-10 codes as submitted in the transactions.
The period leading up to the implementation of ICD-10 is important. The AHA
had submitted comments about freezing of the ICD-9 and ICD-10 codes. It
indicates that the freeze for ICD-9 should begin October 1, 2011, and the
freeze for ICD-10 should begin in January 2012 and continue one year after the
implementation date. In essence, the freeze on updates would allow covered
entities to focus their efforts on meeting the implementation requirements
without introducing new elements into the transition process.
Much of the attention this year has been taking place on Capitol Hill, and a
lot of it has to do with health reform, so it is very difficult to find
headlines for people to get excited about ICD-10 and 5010. But it is important
for our members to understand that they need to begin thinking about these
things. These are regulatory targets that are established out there, and so
they need to begin moving forward with them.
The other area that seems to be clouding the skies a little bit has to do
with the HITECH and IT stimulus, and particularly meaningful use. It is
important here that the implementation of ICD-10 and 5010 are not viewed as a
distraction but perhaps somehow rolled into part of the meaningful use, as part
of that process.
So we would urge the NCVHS to ensure that the 5010 and ICD-10 dates be
reaffirmed, so that no one believes that the dates will slip.
As I mentioned about our briefing, we had sent out the briefing in October
outlining mainly the key components that they need to look at. We have also
held three audio programs this year. We intend to hold some more over the
course of next year.
We are preparing within our publication arm a gatefold — I believe it’s
coming out this month — to also remind our members about the upcoming coding
set changes. We will continue to promote some of the CMS open door forum
discussions in our electronic newsletters when they do occur so that our
members can tune in and find out about some of these informative programs.
The one area that seems to be an area that is of concern, and we heard it
yesterday and today, has to do with the state Medicaid programs in terms of
readiness. We believe there must be firmer oversight with the state Medicaid
programs as well as other government programs such as workers’ comp to ensure
that these plans will become compliant and meet the implementation dates. We
know there are some states that are not current with the existing ICD-9-CM
releases, which is unacceptable. At a time when many state governments are
struggling to cut costs, we do not understand why the state programs are not
moving towards collective arrangements that would rely on a single system
maintainer to manage their information system requirements.
In terms of transaction standards, from a provider perspective, we welcome
the newer versions of the transaction standards. We do not believe they are a
radical departure from the existing standards. They improve on the narrative,
on the reporting requirements, and that is a positive thing.
Much of the data that the hospital collects and reports is the same. We did
a crossmapping and included it in the institutional billing data set known as
the UB-04 showing how the UB-04 data is now captured in the 5010 version of the
The biggest improvement obviously will be in the eligibility transaction. It
will help our members to obtain greater detail about deductibles and
coinsurance. We are pleased that X12 has improved the usage documentation
within the newer releases, but we also are acutely aware that we need to find a
way to make the process towards adopting newer standards to operate on a more
timely basis and predictable cycle.
Today other groups are filling in gaps. We heard about Minnesota and New
York yesterday. There are others who are out there developing operating rules
to support how data should be reported in the transactions. There are others
who have developed certifying programs to test an entity’s compliance with
Much of these efforts, particularly with some of the operating rules on
eligibility, have been directed towards health plans. From our perspective,
anyone that could help align how the health plan applies the standards is
welcomed by the provider community. So that is a positive event.
In summary, the AHA will continue to communicate and reach out to our
members, educating them about upcoming changes with the adoption of the
standards. We will, as I said, undertake audio programs and publications when
Again, we want to thank the subcommittee for the opportunity to present here
today and to, hopefully, let us know what we can do to better inform and
educate the hospitals on these important matters. Again, thank you.
DR. WARREN: Thank you. Again, the panel was excellent. We are open for
questions. Jeff has the first one.
MR. BLAIR: Thank you. My compliments. Thank you, everyone.
Actually, the question that I was anticipating from this panel has been
partially answered, but let me give you an opportunity to maybe elaborate on it
a little bit more, because one of the things that I was trying to sort through
is what is the degree of overlap and competition among resources that are
dedicated to meeting 5010 and ICD-10 efforts versus the meaningful use
requirements. Clearly, there is separation in some ways because the meaningful
use requirements are being built upon the use of electronic health records, so
that that would be, I imagine, a different system. But I would really invite
especially the providers on the panel to indicate to me to what degree are we
competing for resources on this transition and to what degree are they
I guess Nancy, Holly, and George, I am thinking that you would be able to
MS. SPECTOR: I can start by talking about that. When we talk about physician
practices among our organization, we think about the small physician practices.
There is a statistic that we have provided — it is in our written statement —
that 50 percent of practices have fewer than five physicians and account for 80
percent of outpatient visits. So it’s a large number of physicians in small
practices accounting for a large number of the services that occur.
When you think about a small practice, you have very few administrative
staff beyond your clinical staff, and so, absolutely, the competition for the
resources overlaps, and a lot of reliance does go to the vendor because of
that. They just don’t have the in-house expertise to handle the complexity of
IT integration and how to bring in all of these new and different IT resources.
MR. BLAIR: Especially if you have one vendor that does your practice
management system and another one that does the EHR, then you’re in the middle
with coordinating them, too.
MS. SPECTOR: Correct, and it could be more complex if you have different
vendors doing it, because then you’ve got to try to integrate and have those
systems talk to each other.
We recognize that there is a lot of opportunity to be gained in practice
efficiencies by having integrated systems for clinical and administrative work
that’s done, but we also have the reality that many of our practices are still
paper-based or very limited computer-based. So, absolutely, all of these
MR. BLAIR: Holly?
MS. LOUIE: Typically, most billing companies don’t have that same problem.
Where it does affect us is for our practices who are adopting EHRs, EMRs,
electronic prescribing, whatever permutation they’re in, that does compete for
dollars because we have to be able to communicate with all those various
products. Some of them they’re buying now, we have no idea if they’re going to
meet the meaningful use standard. So it requires a lot of IT investment and a
lot of programming to accommodate the electronic transmissions they want to
send us now when they’re able to. But we don’t know if we’re going to have to
completely redo that at some point.
MR. BLAIR: George?
MR. ARGES: In terms of competing, in some ways I do agree, it does compete
and it does make it difficult for hospitals to begin to figure out where to
I think, as Nancy pointed out, obviously there are vendor dimensions to
this. I think sometimes vendors may be more focused on trying to ensure that
their products can also be certified under the EHR. So their attention may be
also taken away to try to meet that element as well.
But, also, from a hospital perspective, some of the meaningful use needs to
have more meaningful definition. I think that has become a difficult part for
many of our members. I think here we have clearly two activities that are
integral, I think, towards the future in terms of helping to construct part of
EHR in terms of helping support the understanding of the care that has been
provided, and yet it is not deemed part of the meaningful use as part of that
It would be nice if money could be tied to that at a later date. Instead,
you have some meaningful use criteria that have been laid out there with some
dollars that have been laid out there, and that is kind of diverting attention
away from what has to be done.
So not that some of the goals outlined aren’t the right ones for meaningful
use in development of an EHR. I think the time lines were a little too
aggressive, from our point of view. We have, again here, two items that are
very complex. One item is very complex in terms of its implementation, and that
needs to move forward, and it needs to move forward correctly and be done well.
MR. BLAIR: Thank you.
DR. WARREN: Sidney, did you want to respond?
MR. BLAIR: Yes, I didn’t mean to — I was focusing it at providers, but you
might have some insights for us, Sidney.
MR. HEBERT: Most of our complications for resources happen primarily in the
clinical area and the operations areas. As we look to the changes that are
coming potentially in 2010, the same people who will be designing new products,
evaluating new products, performing the analytics, risk adjustment and those
types of areas, in the clinical area are going to be heavily focused on that
activity. They are also the same people that we would draw on their talent to
define new ways of exploiting some of the capabilities in 5010 as well as
So any delay in deploying that intellect on business designs for ICD-10
utilization is certainly going to push things out. So those are our concerns.
MS. LOUIE: I had one additional comment. If we move away from just the
standard things, a lot of physicians are looking at electronic records now, and
a lot of them include templates to help them document, to help them create the
One of the things they’re not going to want to hear, since, although they’re
supposed to, they don’t always document to the greatest level of specificity
that could be in existence, and one of the things they’re not going to want to
hear if they’ve made a substantial investment in a record, to have our coding
people, our compliance people, come back to them and say, “But it’s not
good enough for ICD-10.” So that is something we’re trying to educate them
about early on, so that they don’t make significant investments in something
they’re going to have to throw away and start over with.
DR. WARREN: That is an excellent point.
Harry, you’re next.
MR. REYNOLDS: I’ve got a couple of points of clarification, I guess, and
then a couple of questions. You can stop me and put me in line again. I’ll give
you the prerogative of the chair.
DR. WARREN: I just got you in.
MR. REYNOLDS: Cash advances — I have no problem with that. I’ll put my hand
up again. I’m ready. Remember, I sit there some; I understand.
Cash advances. Tell me a little more about — if we hear about the dates,
and it’s pretty unanimous that the dates should be dates, so help me with the
cash advances and what kind of process you were recommending in there.
MS. SPECTOR: I might actually ask my colleague here, Mauri(?), because Mauri
works in our D.C. office, and she has worked much more closely with fielding
the calls that come in from physicians who are not receiving payments.
PARTICIPANT: During the NPI implementation, we got numerous phone calls, and
it was mostly from the Medicare program, where the physicians were not getting
paid, and it was tied to the enrollment stuff. I think even going back to 4010
there were cash flow interruptions.
I think what our concern is is that the same thing could happen again with
5010 and ICD-10. The policy for getting a physician who is in good standing
with the program, the policy for getting basically money advanced to them for
the work that they either did or will be doing is extremely rigid, and it is
not widely distributed in the Medicare program. It is almost, I think, out of
the hundreds of doctors that called me, maybe I got them for two of them, and
it is just really hard. The policy is not well known, it is not well
distributed to the contractors. I went to every single Web site to see if there
was information up, and there was not information on every Web site, despite
the fact that CMS had instructed them to put it up. The customer service agents
weren’t aware of it.
By the time a doctor reaches us, they basically cannot pay their mortgage or
their malpractice premium, so it’s sort of a dire situation when they come to
So I think the recommendation basically is to have a very solid and
well-known policy in place prior to the cut-over dates and that it is less
rigid. We can work with you and with Medicare to do that. We have made this
recommendation before. But it has to be very well-known, too, and it cannot be
like a lot of hoops to jump through when you’re basically going to lose your
house or your practice. If you’re in good standing, we think they should be
able to get the money.
MR. REYNOLDS: Holly, the relay race? When we set up the Level I and Level II
and some of the other things, we kind of had set up a relay race, and some felt
we did it, rather than 5010 and ICD-10 crashing on each other at the same time
and some of the other things. So help me with what different relay race than
the one we have and is kind of in the process that you’re talking about.
MS. LOUIE: I think there are obviously some hard deadlines that we are not
advocating you push back, because I don’t want you to get hit with anything
when you throw it at me. So we’re not advocating delaying those.
But I don’t think there’s any — as much of the testimony has stated — a
collaborative effort between the physicians, the billing companies, the payers,
the clearinghouses, all the integral pieces, their vendors they buy their
software/hardware from, to say, okay, we’re going to do this step and we’re
going to test and we’re going to see how much it works. If 88 percent of the
Medicaid plans aren’t there, then what happens next? Rather than just
proceeding, and all of a sudden you’re to the finish line and 30 percent of
your claims are paid and the rest of them are not, or they are delayed.
So we would just like to see a more business-model approach to that, so
there are hard-stop evaluation points across the spectrum of health care to
say, Okay, we’re on line, or no, here’s our problem, how do we fix it? so we
can continue toward the end zone, rather than getting there and, as Marge has
testified, finding out that physicians are going to go bankrupt or practices
are going to go out of business because they weren’t ready or a key component
MR. REYNOLDS: So are you saying enhanced readiness, evaluation, and real
MS. LOUIE: Yes.
MR. REYNOLDS: Not putting words in your mouth, just asking —
MS. LOUIE: That’s okay, I’ll take those.
MR. REYNOLDS: Because relay races — can’t translate that one so good in
what’s going on.
Now, to the group, I guess one more. It would appear to me — and, Judy and
Jeff, you know we’re in the midst of doing a HIPAA report right now, and I’m
not sure we didn’t hear a few new things to put in the HIPAA report about,
because I think the things that I guess I would like to ask everyone, there
were some — well, we heard the testimony yesterday on NPI, but then there were
some surveys out there about what people are or are not doing and what percent
are only doing this many of the transactions and everything. I guess one of the
things that we will need to work through, Judy, the process of is whether or
not we want to consider — as you listen to all this, and some people have
basically, using testimony, some people have basically not done what was
supposed to be done, and I know most of the people in the industry felt that
there has been a review that you should do what you were supposed to do and you
can get complained on if you didn’t.
So some of these things are alarming as we move to the next level of this,
that there is a segment out there that’s said, “Not going. I’m not coming
with you.” Then there are other groups, again using the testimony that’s
here, there are other groups said that if you’re supposed to do seven or eight
transactions, you do one or you do two or you do three, and I’ll just use
strictly the testimony. I’m not pointing one way or the other. That’s alarming
as we move to this next step.
So whether or not we want to — you know, need to work openly here, how we
would want to recommend considering some other enforcement right now, almost an
enforcement update, because we now have testimony that clearly says that some
people are walking away from it.
The process has been that anybody could complain. Well, maybe — we just
were told that something’s not there. Maybe we — I don’t know. It’s alarming
to start when you have so many people that have chosen not to be where we had
to be, and then we’re going to do the biggest efforts we’ve had.
MS. LOUIE: Companion guides allow circumvention of a lot of the standards.
So the fact that every payer can basically say, “I’m going to accept 837
but I want it this way. I want first name, last name, no comma. I want last
name, first name, no comma.” They are allowed to circumvent the standard
basically, and they have a bye for it. So what can you complain about?
MR. REYNOLDS: No, no, no, I understand that. There’s a whole different
message that came across on your slide and came across in your written
testimony, that some people can only do one transaction.
MS. LOUIE: Right.
MR. REYNOLDS: Well, okay. That’s different. The companion guide came loud
and clear through. That is a statement of walking away. If you say they can
just do one, they walked away from seven. That’s all. I mean that’s a factual
statement based on your testimony. So that’s what I want to understand, because
that’s a big difference from what’s supposed to be going on right now, and that
creates a heck of a — that creates a Grand Canyon between where some of them
are and where we’ve got to get on the other side of this thing.
Does anybody want to make any comments on any of those comments
MR. ARGES: I’ll make a comment and I’ll give you what I’ve heard at least
from our members why sometimes they don’t complain. Part of is they are afraid
The question is whether to some extent there can be a way of providing a
surrogate who can gather information and file a complaint on behalf of somebody
so that the agent who is affected, the provider, let’s say, that is affected by
the complaint is not identified, and to establish a process where the surrogate
basically is identified only on behalf — the detail might be there, but
somehow the realities have to be kept confidential.
I think there’s this fear of retribution I think that’s out there. Now, is
it so real that people aren’t stepping up? I’m not sure, but that’s what I’ve
heard. There’s a retribution aspect.
MS. SPECTOR: To go along with George’s comment, we hear the same thing on
our side, that there is a fear of retribution if they report a compliance
The other point I just wanted to make with what George was saying in terms
of having a surrogate file that complaint on behalf of providers, the issue
we’ve heard is that the level of detail that you need to provide in order to
have that complaint investigated can then make that identifiable. So even
though it could be de-identified at the beginning, it could be re-identified by
that payer at a later point.
Another point I wanted to make is that the AMA did submit written comments
to that CMS RFI on enforcement, and so we have pretty well laid out information
about what we see as concerns and recommendations.
The bottom line when it comes to the variability that exists now with the
way the transactions are handled, the physicians, they just want to get paid,
and if there’s a hoop that they can jump through and it will get paid, whether
it’s compliant or non-compliant, they’re going to do that. Hopefully, there
aren’t too many hoops and they can make it through, but they just want to be
able to run their practice, see their patients, and get paid for the services
MR. HEBERT: I want to make one comment. As a payer we, meaning Humana,
process in excess of 6-7 million transactions a day coming through our
electronic gateways. It is not in our best interest to have variation, and the
best way to avoid variation is to be explicit around implementation to the
Now, I certainly understand the companion guide issue as it’s presented, but
I think the larger the payer, the more rigorous you probably have to be in
order to keep your costs in line. I personally have not experienced that kind
of variability, but I certainly recognize that there’s opportunity for it.
DR. WARREN: I have on my list Walter, Marjorie, and Karen. Is there anybody
else? Walter, you’re up.
DR. SUAREZ: Thank you. I just want to make first a comment because I have
heard information about this lack of compliance, but I would have to state that
we’re not talking about 50 percent of the industry not complying, or 70
percent. I think the vast majority of the industry is complying with the vast
majority of things.
There are certain issues with NPI with non-compliance, with some
transactions not being complied with. But giving an alarming perception that
we’re way beyond non-compliance might be an issue primarily because we might
begin to then shift the attention and the resources, lack or very scarce amount
of resources, into some enforceable enforcement, meaningful enforcement, that
will take us away from the attention of trying to now implement 5010 and
ICD-10. So I think it’s important to make that statement.
But just the very little time that I would have, and I have like five or six
questions, but I will just concentrate on two. First of all, I really like the
message that we are hearing in this hearing. Two years before compliance, there
is an enormous amount of education being done. I don’t recall, back in the 4010
years, when, two years before that, there was that extent of education being
done. So I really like that.
I do have the concern that we might face an overload in terms of information
available and in terms of resources. So my question about education is, do you
feel or do you fear that there might be that risk of overloading the industry
with information? If I’m a small provider, I have 15 or 20 different resources
to go to certainly, which is good, but then which is the right resource for the
very limited amount of time that I have to get trained? And is there a way to
try to help navigate through that wealth of resources and information there is?
So do you believe there is that risk with the overload of information that
we are seeing now? And is there a way to help navigate people through the
wealth of information?
MR. ARGES: Let me kind of respond, I guess, and maybe take a different
interpretation to some extent. I don’t think there could be an overload of
information that would cause a problem, but I do think there are still some
missing pieces that would benefit the industry. I think we kind of discussed
this on a Tuesday meeting that we had with CMS.
It would be nice to have some overview or guidelines or practices that
should be embraced by various organizations, both providers and health plans,
in terms of how they look at certain things, whether it’s the GEMs, the use of
the crosswalks, the interpretation of other aspects that somehow are not being
fleshed out entirely. I think probably that needs to be communicated.
I think one thing that I heard that I would like to go back and communicate
with is where CMS is at. I think that’s an important message that needs to get
out there. I was impressed with what I heard about where CMS is at, and I think
that’s an important message that somehow needs to be pushed out into the field,
and not just from a compliance point of view but more along the lines of what
they’ve done to kind of rethink their process and how they’re going to manage
I was really impressed with that, so kudos to them for doing that. If you
could only get the Medicaid agencies to do the same thing, I would give you a
But I don’t know that there’s too much information overload. I think each
sector is going to do this. I think it’s incumbent upon the industry, if they
do provide programs, that they provide it with an access point that is
reasonable, not overcharge or gouge the market just to take advantage of it.
MR. HEBERT: I would say that the quality of the information that is out
there, at least the part that I have sampled, is extremely good. Unfortunately,
it goes to a point of informing; it doesn’t go to a point of conclusion. The
challenge we’re going to face with such a short implementation time line is
getting to the right conclusion as quickly as possible, because that’s what you
base your designs on.
One of our recommendations is that we take advantage of the CMS learnings.
So I agree with George. I think that CMS has done some excellent work. They are
in a leadership position just by virtue of the fact that they are about two
years ahead of the rest of us. I think we need to exploit that relative
positioning to the industry and provide some leadership on getting to some of
MS. SPECTOR: With the messaging strategies that we’ve been doing and with
the different types of resources we’re putting out there, our goal is to try to
provide a variety of messages and tools, resources, that will be useful for
varying practices and meet varying needs.
But one of the concerns that we have just that goes along with messaging is
that there are so many messages that are going to physicians now, and that’s
the overlapping pieces of not just getting ready for 5010 and ICD-10 but we’ve
got this EHR, meaningful use, that’s undefined right now, we’ve got
e-prescribing that’s out there and security and privacy that’s out there.
It goes back to the point that we made, the recommendation, that we feel
that there needs to be one overseeing body that can coordinate the time lines,
the sequencing of all of these activities, and provide those messages out as to
how all this is going to be sequenced and rolled together.
MS. LOUIE: I support the fact I think the messaging has been very, very good
from CMS, and from AHIMA it has been excellent. Some of the other messaging
from other entrepreneurial agents has not been quite so good. I think message
that this is no big deal, to be a piece of cake, you don’t really have to do
anything, your vendor will take of care of everything, it’s going to go
smoothly, is not the right message that we want to send. We don’t want to send
an alarmist, fright-inspiring message, but we want to be honest that you cannot
just ignore this and think it’s going to be perfect. So I think the consistency
of message is important.
DR. WARREN: We’re running short. Marjorie?
MS. GREENBERG: Thank you to the panel. I really appreciate your testimony.
I think we have heard, as Walter said, a lot of good news and we have each
probably heard some horror story that we’re going to wake up in the middle of
the night with or have a nightmare about.
As Harry said, we’ve heard some things we weren’t even asking for, which is
about problems with compliance with previously implemented standards.
Obviously, that does need to be addressed by the industry.
But what I think we are more in a position maybe to address in a proactive
way is some potential horror stories that we’ve heard about going forward. I
guess mine was — I think we heard some inclinations of this yesterday, but I
heard more directly from one of you, I think, that there are payers who are not
planning to implement the new code sets but just to take the ICD-10-CM or PCS
codes and somehow translate them back to the 9-CM codes based on the
Now, that is something that, even if there is one — hopefully, this is not
widespread, but even if one payer is planning to do that, that is a serious
problem that I think we have to be really proactive about.
I think, as was rather eloquently stated yesterday by Mary — is Mary here?
Yes. Tall chair here. Hi, Mary — from AHIMA — I mean that really could create
real serious problems from a point of view of even a fraudulent situation
because the documentation in the record, presumably, if the provider is sending
in the ICD-10-coded data, it is based on the documentation in the record, and
then you’ve got a claim or somehow an adjudication process that goes back to a
9 code which doesn’t support the documentation.
I guess, obviously, I have a strong interest in the code sets as well as the
transaction standards. So I think here is something where we’ve heard it and we
have to really look also at other things that we’ve heard about what might be
happening down the road and try to make sure those things don’t happen.
I don’t know if anyone has any further thoughts on that, but that was
certainly disturbing to me.
MR. HEBERT: Relative to crosswalks, there’s going to be a continuum of
strategies at a specific system level on how things are going to be mitigated
for the compliance date, and surely some of those strategies will include
crosswalking in key systems.
I think the industry will very quickly resolve their thinking around the
fact that the crosswalk strategy is not a strategy at all; it is primarily a
perishable tactic. It will more than likely ultimately be used to preserve or
elongate a period of time before you would either replace or sunset a system or
as part of your modernization strategies. But by virtue of the lack of
long-term availability of crosswalk technology, it by that very fact is
So I think that there will be strategies that will be deployed because it
makes practical and economic sense. The real question will then become, can we
guarantee a revenue-neutral payment stream? That’s really the question that
comes out of that. That would be on the burden of the individual that chooses
to use crosswalks. They’ll have to prove that for themselves.
DR. WARREN: Any more comments to Marjorie’s — I am going to have to let one
more, our last questioner, because we’re running out of time, and that will be
Justine. So you get the last question.
DR. CARR: I was just going to make the comment that there’s history, because
CMS changes — with annual DRG changes, the CMS CRGs change every year, but the
other vendors, payers may stay with a DRG system, let’s say, in the all-payer
system. Some are on Version 14, some are on 18, some are on 21. So this
retooling of a new ICD-9 code to an old DRG, there’s precedent and history for
doing the same sort of thing.
DR. WARREN: That’s somewhat different, though.
DR. CARR: No, but the consequences are the same because you get all of these
downstream effects that impact a number of areas, quality or payment. So I
underscore the importance of staying current.
DR. WARREN: Go ahead, Karen. You’ve got about a couple of minutes there.
MS. TRUDEL: No, that’s okay.
DR. WARREN: Are you sure?
MS. TRUDEL: Yes.
DR. WARREN: I would like to thank the panel again. You’ve given us a lot of
information to think about as we deliberate on this.
We are running a little bit late. If people could come back about, oh, 1:25
from lunch, then we’ll start again.
(Whereupon, at 12:30 p.m., the meeting recessed for lunch.)
A F T E R N O O N S E S S I O N
DR. WARREN: We are starting with panel number seven and we are continuing
hearing from health plans and providers. We have Joe Miller from HIMSS, Darren
Townzen from Walmart, Dan Cobb from HealthMedX, and Scott Ransom from Brookdale
Senior Living and Donald Horton from ACLA. With that again we will go down the
list. Joe, you are on.
MR. MILLER: Okay. Great. Thank you. I am Joe Miller. I am fortunate to work
with 24,000 other health care IT professionals through an organization called
HIMSS, Health IT professionals who are dedicated to using technology to improve
the quality and efficiency of our health care system. The members of HIMSS and
a HIMSS board of directors applauds the attention this committee is giving to
this important topic and we welcome and appreciate the opportunity to be able
to share our views and thoughts on this topic with you today.
Now, I represent in HIMSS the financial systems community through the HIMSS
Financial Systems Steering Committee, which is charged with supporting the
industry and providers with a specific focus around health care information
technology specifically with administrative and financial transactions and
activities. Now, we on that committee include clearing houses, vendors,
providers as well as others from the industry. And within our systems committee
we have established this as a key focus for our activities this year and for
future years and part of that is to establish a task force, which comes under
our committee of members who are working on both assessing the current state of
the industry and then developing or utilizing resources that can assist our
providers and our community of members in achieving compliance in a timely
manner with these changes.
Our approach to seek first to understand, understand what the needs of our
providers are and members, and then to be understood through delivering very
targeting and key information around this topic.
One of the key activities that we have done recently has initiated a survey
process and we did a baseline for this survey process in November of 2009 to
address both 5010 and ICD through separate questions through the survey. The
survey covered 14 questions covering substantive areas: awareness, what is the
planning and progress organizations are making, what is the approach that they
are taking, and what are the obstacles and competing initiatives that they are
experiencing. The survey is designed for periodic use. We intend to survey our
members in April 2010 with actually a larger number of respondents and then
continue that on in roughly six-month intervals after that.
The survey as you can see was fairly detailed in terms of the questions that
we asked. This is one of them regarding an organization’s preparation. We asked
the question both for 5010 and for ICD-10.
In our initial survey we had 56 responses, as you can see here, most of them
being providers and the provider distribution was about 80 percent hospitals
and IDNs and 20 percent practices. And the responses and the data that we
present here today are just in that provider space not the other components. We
really didn’t have enough data on the other components to be able to deliver
meaningful results to you.
I mentioned first one of our topic areas is 5010/ICD-10 awareness. We asked
the question does your organization adequately understand the timeline and the
changes for 5010/ICD-10 compliance. As many have reported here before me from
their own surveys or experience, most providers do understand the timeline for
5010. You ask them what is the timeline and basically they are going to give
you that end date. But fewer of the providers when we survey them, understood
okay what the real meaning and changes were in 5010.
I found similar actually some slightly better results from an ICD-10
perspective. And our conclusion in this area was that providers are focused on
the compliance state but are really less sure about what it is this really
means to them.
We also asked about the project or the planning for 5010 and ICD-10. And
again here we found not dissimilar to other findings of others that only 12
percent of the providers had a 5010 project formally initiated. Meeting number
one they had a real project plan out there and that plan had in some way been
resourced. Twenty-nine percent said they were going to initiate their project
in the next six months, 26 percent within a year, and 24 percent did not have a
plan to do the plan. And in ICD-10 as you might expect the responses were a
little bit more skewed toward being earlier in the process.
I guess one of our conclusions here was that providers really are viewing
5010 as a 2010 project at best, which suggests that they are going to be real
challenges for providers to meet a 1/1/2011 level I compliance date.
Around preparation we asked what providers were actually doing today and
over half of the providers indicated that they were assessing what they needed
to do for 5010. It wasn’t that they were denying that 5010 was out there. We
are looking at it all. But over half were assessing. Only 9 percent had
completed the changes required. Not surprising. Sixty-three percent we are
assessing had some type of action plan, 25 percent didn’t know or did not have
any plan or were not really actively working on this in any way, shape, or
form. While providers may not have a specific plan at least they have initiated
their assessment process.
We asked about the approach to 5010/ICD-10 because it is very interesting to
us as an organization to understand how providers — what is the work that they
have to do? This would be revealed in our approach. Fifty-six percent indicated
they planned to upgrade or replace their patient accounting practice management
system to achieve compliance. That is probably a little bit skewed because of
the large number of hospitals and IDNs that were involved in the survey. Nine
percent indicated they replaced their current practice management system as
part of an electronic health record implementation. Twelve percent would rely
on clearinghouse services and 23 percent had not determined their approach. Not
surprisingly in the ICD-10 area 35 percent didn’t really know where they were
going yet at this point. We did find that a significant number of providers
have identified their approach to 5010 in a general overall level.
One of the things in HIMSS that we talked about a good bit and I know my
colleague Miriam Paramore was here yesterday speaking on behalf of Emdeon, but
Miriam is on our board of directors and she and I gave a presentation back in
September around the confluence of all of these changes in health care IT and
we kind of talked about this as the perfect storm. What we really were looking
at is if we look at all of these initiatives that are out there, we see an
enormous demand on the resources and efforts of health care IT I would say from
about the mid-2010 to the mid-2012 timeframe. You can move it either way and
probably to say that it will end in the middle of 2012 is probably unrealistic
but we see if you look at 5010 obviously you got development testing. It goes
into production but their stabilization is going to take a while and that has
been cited by a number of folks here.
The HITECH Act and implementation of electronic health records is going to
have an enormous impact on our membership and our provider community as well as
and sometimes we don’t look at this carefully enough I think is the HIE
development that is going on and providers to achieve meaningful use not only
have in this timeframe of several years need to change their administrative
transactions. They are going to be expected to start to deliver and exchange a
whole set of new clinical transactions that they have never exchanged before.
There will be a whole other set of companion guides for that. Providers can’t
wait for that I will tell you.
We have the security and privacy mandates, health care reform, other. We
have ICD-10. And then on top of all of this and it kind of fell off the bottom
of my slide but to be honest from what we hear from many providers is their
C-suite has its own business initiatives that is going to determine how they
are going to improve revenue and quality and all of the other major kind of
initiatives that they have in their organization.
This is what we really do see as the perfect storm and it not only hits the
provider community. I think earlier today there was a question about the vendor
community and does this hit the vendor community. What we are seeing in a lot
of cases now is vendors who have previously only had a practice management
system now are bringing in and supplementing that with an electronic health
record system that is going to meet meaningful use and vice versa. And when you
have vendors who are challenged with looking at compliance and then their
growth as a company, these are very difficult decisions they are going to be
making around what are the priorities for them as they move forward.
We asked about competing initiatives. We found that actually almost
two-thirds of the respondents indicated that implementing electronic health
record or other major technology project were going be competing for resources
for 5010/ICD-10. In addition, about 53 percent said there were key initiatives
they had for their organizations that were competing with it and then another
40 percent indicated that there were other federal and state compliance
initiatives that they felt were going to compete. Obviously in ICD-10 a lot of
the same findings although some providers cited 5010 as a competing initiative
for ICD-10, which is kind of humorous in some ways but does make some sense
given that the 5010 compliance may be really being worked on and primarily run
out of a different section of a provider organization than the ICD-10.
A major challenge for providers we see is how they deal with this perfect
storm. And one of the things that we have been talking to our providers about
and our members about is the importance of having a strategy for all of it.
That you can’t look at just one, this piece, this piece, and this piece
separately. And in fact that is a key strategy for some providers in terms of
how they are going to actually pace their initiatives over time. A provider may
decide to upgrade or replace their practice management system and with another
product that is also going to include electronic health record. When do they do
that? Are they going to be able to get that system in time to meet 5010
compliance? There is some sequencing here that we have not really studied
carefully but I would like to try to get to a little bit on our next survey
about what are the options and how are providers looking at the sequencing of
What are the obstacles to 5010/ICD-10 compliance? Well, almost two out of
three providers indicated that the lack of internal or external resources or
knowledgeable resources were the primary obstacle they saw as achieving
compliance. Now, this is important I think. The knowledgeable is key and I
believe that it was mentioned this morning as well. There aren’t a lot of
people out there on the street walking around with detailed knowledge of these
transactions and there is a real — and the people that are may being attracted
to other kinds of health IT jobs as we move forward and more jobs become
available. There is a real challenge here in finding these knowledgeable
resources and the providers are seeing it already.
In addition, 49 percent indicated that they needed more information around
compliance requirements. There is some lack of knowledge out there about the
specifics around 5010 and ICD-10 and what it is really going to require and
change in an organization. Forty percent had limited financial resources and
interestingly enough this is a little counter intuitive and it goes a little
bit counter to previous testimony and that was we found that really only 14
percent were really concerned about the vendors at this point. What I would
attribute that to is if you look at where providers are in the process of
actually planning out their efforts, they may not be thinking so much about
these providers anyway that limitation. A little bit later when we report
probably next year we would expect to see that.
What are some conclusions? Well, first, providers are well aware of 5010 but
they appear to be more focused on the level II compliance deadline than the
actual changes required. Many providers won’t meet that level I compliance
deadline of 1/1/2011, and we think that that would be certainly a great message
to come out with is that level I compliance. Where are you with level I
compliance? A lot of providers don’t really think about level I and level II.
They just think about level II.
Most providers will be upgrading or replacing their current systems with
some — obviously relying on clearinghouse services. I would expect that the
number of providers utilizing clearinghouse services will change over time and
in fact grow because I think that one of the challenges for providers will be
that as they move along with their process and they realize the complexity of
some of these changes as well as the challenge of finding the staff either from
a vendor or their own staff to be able to implement them, they may see that
some of those projects are delayed and those delays could end up in them
becoming a little bit more for 5010 reliant on the clearinghouse services. I
don’t think they are going to be able to rely on clearinghouse services for
ICD-10 obviously, but for 5010 there certainly is an opportunity for providers
to utilize those resources of clearinghouses at least as a tactical measure.
EHR and other system implementations are the major competing initiatives and
major obstacles cited by providers is the lack of knowledgeable resources as I
What are our recommendations for government and industry? First, improve
awareness and particularly around level I compliance deadline. A lot of
providers are looking at this as a 2010 initiative. They are not going to have
a snowball’s chance of meeting that level I compliance deadline unless we
refocus on the tension on that. It was a brilliant concept I think to have that
level I compliance deadline in there so the people had an interim measure and
benchmark for themselves that was really in the regulation. But it doesn’t feel
like as an industry we are using it very well to prompt the kind of early
attention and adoption that really I think was intended to support.
We need some more case studies and examples of how organizations are
balancing and leveraging and going about handling these competing initiatives
in a perfect storm. We need to share more detailed information. I think
providers need more detailed information about impact assessments, gap
analysis, project plan that can help them really understand what the changes
that are required are. And then part of our role we feel is to continue to
monitor, expand this survey out to a larger subset, and move forward.
Providers have a long ways to go and I will give just a brief — in one of
my conversations with a clearinghouse. We are talking about the transition from
4010 to 5010 and actually using this clearinghouse to send out our survey and
the clearinghouse works more with smaller providers. A gentleman from the
clearinghouse told me, well, Joe you know I’m not sure this is going to be very
meaningful for a lot of providers. I said, what do you mean? He said, well, you
know what the most frequent submission for us is to our clearinghouse from
providers? I said, no. He said we get more paper images than we get of any
other transaction type. We get more than the second most frequent is the
national standard format and the third is 4010. When we think about providers
being out there and ready to move forward, I think that we have to also have an
idea of where they are. That is probably not true of larger health care systems
and so forth but there are a large number of providers out there who are on
older technology, which will still be potentially — they will be able to
remediate through a clearinghouse for 5010 but the impact of that for ICD-10
will be much more significant. I leave with you that today and I know we will
move to questions probably after everyone else goes.
DR. WARREN: First, I am very glad I paid my HIMSS dues this year. This made
it worthwhile. Second, I am certainly glad we have a JPEG standard for those
images and then I would like all of you to consider because I didn’t get to ask
my question last go around but it has to do with number two of how do we help
the C-suite balance all of these issues. Be prepared. I will have a question
later. Darren Townzen.
MR. TOWNZEN: Good afternoon. My name is Darren Townzen. I work for Walmart
Stores Incorporated. We currently operate about 4300 pharmacies both in the
United States and Puerto Rico under formats of Walmart, Walmart Super Centers,
Neighborhood Markets and Sam Club’s pharmacies. Thank you very much for the
opportunity to be able to speak here.
Just to kind of place a little context on here. My roles within Walmart
today is I deal with the practice management systems that our pharmacies use
and I also deal with the third-party transaction sets. Working with that, the
connectivity and the third-party pieces just to kind of add a little bit of
context. I also am a pharmacist as a background so understanding what is like
to be on the frontlines. How I am going to pursue this is looking at it through
the lens of the actual customer itself.
The objectives are going to be to talk through the current state of
planning, prioritization of new codes, potential hurdles, planning and
implementation priorities, and risk areas. If I am looking at from the current
state of planning, with regards to all of the transaction sets of all the three
that are mentioned today and most of the ones that have been discussed, in the
retail world the biggest set is by far going to be the 5.1 to D.0 conversion.
The good news is that the ICD-10 and the 5010 series are not so much impactful
for this. But we have also got a good basis of experience and also expectations
when we went from the 3.2 to 5.1 some years back. It kind of adds a little bit
of context for us to at least kind of know what to expect.
Our current state of planning and I will say this in representation of what
our organization is and also what other organizations as well. Requirements are
currently underway. We are starting to enter the development process. As with
any project of this magnitude, it is going to go through the disciplines of
anything. It is going to go through development. It is going to through all of
the testing pieces, the internal testing, and more importantly the user
acceptant testing on the back side of that. Anticipated compliance testing is
scheduled to be the 4th quarter of 2010 and also we will begin
transitioning with the trading partners in 2011 if not sooner.
If I am looking at the prioritization of the new codes — because of the
timeframe for implementation and this has not been consistently heard from at
least thus far today. The timeframe that we have had with knowing what was
coming and probably because of our involvement with NCPDP it has allowed us to
go back through and say yes we know this is coming. It is coming on the
horizon. It’s not an option. You have to allocate the resources and the talent
and the subject matter experts to ensure that you get this done. The timeframes
have been very well defined.
As far as it impacting other priorities or other projects, there is no doubt
it is going to displace other projects within our company and I don’t think
there will be any other organization would say anything different but the thing
is that being that this is such an important transaction set and changes
realizing that and also just the impact as it amounts to our insurance percent
of our sales as with anybody else, we recognize the importance of it.
The other piece of that is also that has driven that awareness is industry
participation through organizations such as NCPDP has helped us develop the
urgency and the internal prioritization of it. A lot of talk about having
executive sponsors so that it gets the attention so you don’t have a project
that may come in and take precedent over it. Having this representation and
also having the awareness internally that there are other external sources
coming up with the same conclusion grants the awareness to it. Even if you look
at it from — you place it in compliance bucket. Well once you place it in that
it gets the attention that it needs.
If I am looking at potential hurdles — I kind of broken these down into
three different categories and again I am looking at this through the lens of a
retailer but also looking at it through the lens of our customer who is going
to be at the counter wanting their medication. The first hurdle is going to be
insurance processors that implement a hard cut over rather than a transition
period. It’s not the end of the world if they do a hard cut over but it
introduces a level of risk that is just really not needed. In the past when we
did the conversion to 5.0 we had those transition periods and they worked out
very well. There were instances to where it was really a good thing we had a
transition period because we had to react to that. Transition versus hard cut
over is definitely preferred.
Identifying all possible scenarios that have been simulated to ensure their
system compatibility. This is just the due diligence in testing in making sure
that we have identified everything that could possibly happen. This shouldn’t
lull us into a false sense of security that say well if we have done that then
we should be able to do a hard cut over. Again, it is one of those risks we
just don’t want to take on.
The last piece of this — again, this is looking through the eyes of the
customer. Reduction in payer sheet changes to new D.0 fields following the
conversion to prevent rejections on refills on 5.1. That is a little bit
different context than some of the other things that have been discussed this
morning is that we have repetitive transactions on refills that if it was
filled before the D.0 field was even available and all of a sudden it is
starting to be required, it could cause a lot of rejections and ultimately
impact our pharmacist and our pharmacy associates but more importantly it is
going to impact that customer and delay them in getting their medications.
Those are the three hurdles that I see just during the transition pieces of it.
As far as the planning and implementation priorities as I said earlier one
of the benefits we have is we know what to expect. It’s not like implementing a
new project where it is kind of learn as you go or you try to take all the time
to anticipate. We are fortunate enough to have a lot of the same subject matter
experts during the 3.2 to 5.1 conversion to also facilitate this type of a
conversion. But if I am looking past that and I am looking at hey here is how
we have already developed it now I am looking at your transition, the first
thing is frequent communication with each processor and this is frequent and
open communication. Making sure that we know exactly what is going to happen
and we have the testing scenarios all set up then we want to make sure that we
are fully prepared going in to whenever that transition date is going to be.
Up-to-date payer sheets provided early in the process. The payer sheet is
the golden document as far as pharmacy is concerned. It is like the recipe
page. When I tried to explain it to somebody internally what a payer sheet is,
I said it is exactly the recipe we are going to follow to send this claim and
there is not any altercations. This is what it is and we will follow whatever
the rules they set for it because all of those have already been defined within
Defined testing scenarios and certifications. The certifications whether it
is just a — you have a nice sheet of paper that shows that you passed all the
tests. All it is is it adds that next level of clarity to ensure that we don’t
have any surprises.
Probably the biggest thing that we have learned from the conversion earlier
was ensuring appropriate training for our pharmacy personnel at the pharmacy in
the trenches themselves at the stores, but also the home office support side of
it. All the back end processes really it is intended to be very transparent at
the store. There will be some changes obviously, but for the most part the
transaction sits behind the scenes what we need to try to build from a support.
The last one is plan for no surprises. That is going to plan A, B, C, and D.
That is great. At the end of the day we still want the end results.
From risk areas. From our perspective again it is to the 5010 and ICD-10.
They are a very small percentage of our business. We use the ICD-9 and codes
today in the clinical segment of the claim but this mostly is associated with
part B and DME claims. The vast majority of our regular claims don’t
necessarily have the ICD-9 associated with it. But if I am looking at the 5010
and more introspective just on the payment side of it, if there system and
compatibilities between the two, it can inadvertently cause a delay in payment.
That is not necessarily saying that we didn’t receive the check on the right
time. It is about the accounting process of it. If we have some type of system
of compatibility, we may not be able to be able to reconcile that from an
accounting perspective in a timely manner. And also if a notification of
rejected claim is only within the 835, again causing that delay would just
ultimately cause any type of reaction because of that rejection.
With the ICD-10 on the part B and DME claims our biggest concern are going
to be walking through refills. Refills are really not something you see in the
medical world itself but in pharmacy it is just one of those things that is
reoccurring. You have to make sure you account for those.
In summary, successful implementation is going to depend on the following.
Open and frequent communication with the payer. One of the things that we have
that I consider very fortunate with our industry is we have a very good
relationship with our payers because at the end of the day we are going to
ensure that our customer is not going to be impacted and their recipients
aren’t going to be impacted. Detailed planning and preparation for pharmacy
personnel. This is the training on the backside. And also continue industry
support the organizations such as NCPDP. That organization is very fortunate
for us to have something that allows it to be a forum for discussion, to
benchmark, and also just to make sure that there is awareness and preparedness
in the industry. When this change does happen it goes as smooth as possible
during the transition phase. Thank you very much.
DR. WARREN: Thank you. You are right on time. In fact you just gained us
about five minutes so I appreciate that. Dan Cobb.
MR. COBB: I am going to give half a testimony. We are tag teaming this. Hi.
I am Dan Cobb and I am actually wearing three hats today, one of which is as a
vendor and we have talked about the vendor perspective a lot this morning and
this afternoon. My second hat is on behalf of a group of vendors. I am also
here representing the National Association for the Support and Long Term Care
and I chair the IT committee and the IT committee consists of all the major
software providers for long term care and home health care. My third hat I will
get to a little bit later but I want to thank you for the opportunity to speak
to you on behalf of our industry. Scott will take the second half and I will
let him introduce himself when he gets started.
The structure of our presentation we thought it might be useful to start
with a systems perspective of converting to the HIPAA 5010 and ICD-10 and then
talk about the provider perspective and I think you will find they are a little
What I would first like to do is introduce to you our industry, Long Term
and Post Acute Care and the reason I am taking a few minutes to do that is it
is even a challenge to us in the industry to define who we are and I suspect
what I will come up with there may be some debate to that but I think that also
makes it interesting. I will also talk about a collaborative of organizations
and I will speak to how that is relevant to the 5010 and the ICD-10. And
finally, and all of this in probably less than 10 minutes if I do it right,
give an understanding about the systems preparedness for the 5010 and the
ICD-10. Then Scott will talk about what the providers are doing to get ready.
Long Term and Post Acute Care we have come up with a term LTPAC to describe
a lot of different things and you can think about it as some all care provided
to seniors. It is a post acute care from hospital discharges. But generally
speaking when we talk about Long Term and Post Acute Care, we include nursing
homes, which include the skilled nursing facilities and the long term nursing
facilities, home health care both the Medicare certified and private duty,
hospice both inpatient and home delivered hospice, assisted living communities,
continuing care retirement communities, which is a concept where multiple
services are provided within a single community and this is by far not an
exhaustive list. You can think of — is there a question?
DR. WARREN: I was going to say when we were planning this, one of the
concerns I had on our time limitations is to have to choose between your list
and seeing the list one slide is wonderful. Thank you.
MR. COBB: Thank you. What I was just about to say that this is not even an
exhausted list. You can include inpatient rehab facilities, long term acute
care hospitals, et cetera. LTPAC and we started calling ourselves that over the
last few years and it has really helped give a little bit of clarity about this
sector of the market and what I am going to do now is demonstrate some of the
size and the scope of the industry. We have heard a lot from hospitals and
physicians, the ambulatory care. LTPAC is a very sizable industry. And, again,
out of all of those care settings I am just going to pick out a couple.
As far as the nursing homes, 1.7 million beds nationwide delivered by 16,000
plus providers. Medicare and Medicaid expect to spend about $78 billion just on
the nursing homes this year and 1.75 million people are employed by nursing
Home health care, another care setting, one of many, 7.6 million patients
served by 17,000 providers. Total expenditures of all pay sources in the $57
billion range. This was a couple of years ago. And almost a million people
employed by the home health care industry. Again, these are two of a dozen or
so care settings within long term and post acute care.
The third hat I wear is as a member of the LTPAC, HIT, Health Information
Technology Collaborative and this is a group. We have been together for about
five years. Stakeholders and what you will find organizations, all of the major
organizations that represent the providers, the suppliers, the vendors such as
myself and we also have government stakeholders. We have members from ONC,
members from HHS that sit in. We meet actually on a weekly basis. The point
being is this is an ideal conduit for our industry for awareness the 5010 and
the ICD-10 up and coming. What we have utilized this organization in the past
for is we have put on a health IT summit for long term and post acute care for
the past five years and we have published an HIT roadmap every two years. We
are working on next year’s edition. We will publish it next month.
In addition to those we also work through issues of the day that happen
within our industry. It is very convenient to have a group of all the
stakeholders, suppliers, providers, government officials sitting at the same
table working through what is best for our industry.
Now we will get to the systems part. I thought I would bring up a few stats
here. Most and again of all the dozen or so I am thinking of nursing homes and
home health care agencies, but nearly all of them have some sort of technology.
And of course if you think about patient assessments and claims that is where
the ICD-9 and 10 and that is where the HIPAA 4010 and 5010 will come under
play. However, about half have some sort of electronic health record at this
time as well. The reason I am here giving the systems perspective is that a
majority of the systems in our industry are purchased and not self-developed.
While I am speaking from the systems side but also from the vendor perspective.
This is slightly tangential but I thought I would include it is significant
that the LTPAC EHR industry is going through the certification process defining
electronic health records certifications. We will have our first draft out next
Monday and we will be set to start certifying electronic health records next
summer. The reason I added that in there in that one of the things we are
passionate about is including standards based inoperability and having
standards included. We do have the Continuity of Care Document, the HITSP C32
implementation of that in our criteria at this moment. The NCPDP SCRIPT,
ePrescribing, SNOMED, and of course the ICD-9, ICD-10, all of those standards
are baked into the certification. The reason I put this in is another way our
industry is reinforcing not necessarily from a mandate more from a carrot than
a stick as far as having all of the standards built into the systems.
As far as the ICD-10 goes, it is from our perspective as far as developing
the systems, it is largely a technical exercise in that you could liken it to
we are changing the size and the shape of the box. The content of that box is
really where the challenge goes. And I think we had talked earlier today about
how the ICD-10 is much less an IT project than it is a business and clinical
process project. Scott will be spending a lot more time on that than I am.
Basically from an industry from a software standpoint it is another thing for
us to do and we will be doing it.
I did want to mention a couple of things though relating to the federally
mandated assessments. There is an OASIS assessment for home care, MDS for
skilled nursing facilities. There are numerous state mandated assessments and
of course the care instrument that will be for all of the post acute care
One of the things that we are interested in or that we will be watching
closely is how the ICD-10 comes into play for the assessment instruments
because as you can see they are phased in at different times and different
periods and we are interested in how the ICD-10 strategy will fit into the
clinical assessments as going forward.
This point is also somewhat tangential but I thought I would include that as
an industry we have been pushing hard for standards-based interoperability in
general and have been working with CMS on having standards such as the CDA,
LOINC, and SNOMED content standards within the assessment instruments. Limited
success but we are not going to stop trying on that.
As far as the 5010, again, that is more of a technical matter and I would
guess most of the LTPAC providers would have no idea what that is and that is
because in most cases they purchase a system and the systems are responsible
with it. I would echo a comment earlier that the implementation of the 5010 is
I hope it’s not as diverse as the 4010 was. The 1400 implementation guides was
a staggering number for me, but I can tell you as a vendor it has customers in
47 states. Of the 4010 we have dozens upon dozens of implementation of the
4010. It is mostly the same, which is good but it’s never the same.
The NCPDP D.0 and 3.0 is really more for the pharmacy side of things and we
don’t deal with that that much. That is the end of my testimony. I am going to
turn it over to Scott to do the provider side.
MR. RANSOM: Thanks for warming up the crowd Dan. I appreciate it. My name is
Scott Ransom. I am the Chief Information Officer for Brookdale Senior Living
and I appreciate the opportunity to represent the long-term care industry
provider segment. For those of you who don’t know who Brookdale Senior Living
is Dan showed the continuum of care that is out there. Brookdale has the
dubious honor of representing all of those continuums of care.
We are the largest provider of senior housing in the United States. We have
565 properties in 35 states across the country. We have the ability to serve
over 53,000 seniors every day. We have about 37,000 associates across the
country. We have multiple product offerings. As I said we represent the
continuum of care. We have independent and assisted living. We have as we all
enjoy our acronyms CCRCs are Continuous Care Retirement Communities. We also
have a large ancillary services business including therapy and home health. The
ICD-10 and the things that we are talking about are most prevalent in that part
of our business but I wanted to give you guys a sense of the scale of what
Brookdale Senior Living has. We have about 450 therapy clinics across the
United States. We have over 3000 therapists and we have 31 home health agencies
with about 300 nurses. You can see the map on where we are located. Our
business the pie chart on the lower right hand corner for you represents the
percentages of our business broken down into those continuums of care.
I have been listening to the testimony earlier today. The challenges in the
long-term care, home health business is not any different than in the acute
care where you are talking hospitals and you are talking about physicians. My
main point that I want to echo to this group is this industry knows less than
the hospitals and the doctors do. I represent the largest provider in this
space and I can tell you until Dan called me about a month ago this wasn’t even
on my radar screen. When I went to talk our therapists and I went to talk to
some of our home health folks, they had some awareness and I think that is what
I want to mostly echo to you today that the hospitals and the doctors are
planning. We are woefully behind where we need to be.
Will there be enough? As you guys as you look at the multiple care settings
where you need to put resources and awareness, will there be enough qualified
trainers for the approach in the long-term care industry? Most long-term care
clinicians don’t have a strong background in coding. We are talking about going
from the ICD-9 to the ICD-10. This is where Dan as our software provider can
make it technically work but we have people that need to be filling in those
buckets with those codes. We have a lot of training to do.
We have talked about other industries increased risk for claim rejection or
slow down. Not any different in our industry. Any increased inaccuracy for home
reimbursement. The same thing in our industry.
What I did want to share with you I quickly being an IT and a pretty black
and white person put pencil to paper. As we as an organization hadn’t done a
lot of planning we quickly did some numbers as I talked with some folks. Here
is what we think the impact is to an organization like Brookdale. These are
very preliminary numbers but it gives you an order of magnitude for us.
In our home health and nursing facilities we believe that it is about 16
hours per person. The math is 16 hours at $35 an hour for 550 nurses. That is
$300,000 in training that we need to do. For our therapy staff it is a little
bit larger because we have more. We figured we can do it in about eight hours.
We have about 3000 therapists across the country. That is another $840,000 in
additional training for those. For a total cost just in training not lost
productivity, just in getting them ready to do these types of things we are
looking at $1.2 million to $1.5 million spend for Brookdale Senior Living.
We will obviously take the opportunity to improve our business processes and
practices as we look at that. Being a good IT person that is what we are
supposed to do. Help the business do those types of things. We think that we
can identify a six to nine-month period where we can improve some of our
business processes to go along with this. Those are some pretty staggering
numbers and I have heard people talk about competing projects. I can tell you
right now my fellow C-suite folks if I ask them what ICD-10 was or what we are
changing, they have no idea that this is supposed to be on the radar screen.
And from my perspective as Dan said this is not an IT project. It will be
doomed to fail if IT has to lead the way with this. This needs to be owned by
our clinicians out there.
After we get through the initial phase of getting them ready to be able to
do their job I have asked our clinicians to put some estimates on what we think
that first year and subsequent years could mean from a productivity standpoint
for us. We think that there would be an additional 10 minutes per analysis in
interaction with the physicians and we estimate that we have about 20,000 of
those interactions per year or an additional 3333 hours per year. An additional
15 minutes per OASIS or MDS. We have about 44,000 events like that a year in
our organization or an additional 11,000 hours. Total estimates ongoing cost —
now when I say ongoing that first year will obviously get better as we do it
more often so this should decrease. But we are looking at a substantial
decrease in productivity out there in the street. Stated differently one of the
things that we look at as one of our key indicators of how our business is
doing is productivity therapists and how well they are being utilized versus
travelling. A 1 percent drop in productivity for our therapists and nurses
equates to about $300,000 in lost in revenue per month. When you start adding
up these times in the first year that could be substantial for our company.
I think it was from Walmart you were saying about not only the fee on the
street in doing those things but the back office. We have a very substantial
back office processing center in Nashville. We are concerned about the
increased time especially in that first year in additional following up and
chasing of the reimbursement. Those front feet on the street and the back
office things are obviously very important to us.
From a HIPAA 5010 I know we have talked a lot about vendors and I am very
dependent on my vendors sitting here to the right to make sure that they get
those things prepared and ready for us but that really from a standpoint for us
is a behind the scenes technical change. The thing that I would like to say as
a provider is you need to do everything you can to get the information to my
vendor in order to prepare me to get it to me now. Brookdale Senior Living I
have about 120 people in IT.
Just to give you a sense in the long-term care industry the top 10 providers
us being the largest only control about 10 percent of the beds. Think about
that. That is a very fragmented industry. I have the IT people and I have the
business folks that can implement this. I’m not sure what some of those smaller
providers are going to do. We talked about the smaller physician offices where
they only had four or five physicians.
We have a lot of people in the long-term care industry that have a part-time
IT person that may help them get through some of these things. They are
woefully under prepared for this type of a change in our industry. Getting
those changes to our vendors, getting our vendors prepared goes a very long way
in getting the providers prepared in the long-term care industry.
We have talked about this. Implementation and training, ongoing costs will
compete with other capital projects. Like I said at any one time we probably
have $10 million to $15 million worth of projects going on. And like I said our
C-suite has no idea that this is even going to be hitting the radar screen for
us to do in 2010, 2011 and so forth.
Beyond that and this is what I would like to say and I think it came out
when we talked about the physicians. There is a limit to the amount of change
that our facilitators can take at any one time. We actually can produce more —
you guys heard the biggest lie. The check is in the mail, right? Well, the
other biggest lie is I am from corporate and I am here to help.
We look at the initiatives that we develop from a corporate standpoint and
we calibrate those and we limit them to the communities. These changes will
have big impact in our communities and will hinder the amount of other business
changes that we want to make in the community. That is just something to be
said there for not overwhelming our communities with what they need to be done.
I think I have already stated this. Getting our vendors ready with the
standards early and often because once they get it done we still have to go
through our end-to-end testing and our integration into our other systems that
work within our regular business processes. And, again, I have talked about the
size of our industry and the fragmentation. Based on the size and scope these
implementation timelines could vary based on the size of the organization.
With that I think we are going to have questions later. I will turn it over.
Hopefully I have picked you up some time.
MR. HORTON: My name is Don Horton. I am Vice President of Public Policy and
Advocacy at LabCorp and I currently serve as chairman of the ICD-10 work group
for the American Clinical Laboratory Association or ACLA. Mr. Blair, Dr.
Warren, and members of the subcommittee and staff, thank for the opportunity to
testify today on behalf of both ACLA and LabCorp regarding the issues faced by
clinical laboratories in implementing Version 5010 of the HIPAA standard
transactions and the ICD-10 code set. ACLA represents national, regional, and
local laboratories, and its members, including LabCorp, play a critical role in
our health care system, providing accurate, timely reliable and objective
clinical laboratory test results, which influence over 70 percent of all
The ability of clinical laboratories to perform this vital role is in part
dependent upon their ability, and the ability of their trading partners, to
conduct administrative transactions in an efficient and effective manner. As a
result, the transition to Version 5010 of the HIPAA standard transactions and
the ICD-10 code set is of significant importance to the clinical laboratory
industry and we are committed to be working towards the most seamless
implementation of those standards possible.
The issues that clinical laboratories face in implementing Version 5010 and
ICD-10 are not insignificant, and their resolution will require cooperation
from multiple stakeholders in industry and government. While we share many of
the implementation issues faced by other health care providers, some issues, or
their degree of impact are unique to indirect providers such as clinical
laboratories, and those differences must be taken into account to ensure
successful transition for all.
While there is some variation within the clinical laboratory industry with
respect to the current state of planning for Version 5010 most clinical
laboratories have made measurable progress. Few if any clinical laboratories
have not yet begun implementation planning for Version 5010 but few if any have
completed the implementation planning either.
The degree of completion of implementation planning ranges between 25
percent and 75 percent. Most clinical laboratories have formed a Version 5010
project team or are in the process of doing so have begun to contact
information system vendors and payers regarding Version 5010 implementation,
but have not been informed yet of when major vendors will be delivering Version
5010 software, and are planning to upgrade the 837 claim, 835 remittance
advice, 270/271 eligibility inquiry and response, 276/277 claims status inquiry
and response, and 278 prior authorization/referral transactions to Version 5010
by the January 1, 2012 compliance date. However, there is more variation among
clinical laboratories in their estimated dates for completion of Version 5010
internal testing, as some expect to complete internal testing between September
1 and December 31, 2010, while others do not expect to complete internal
testing until sometime in 2011.
There is greater variation among clinical laboratories with respect to the
current state of planning for ICD-10 than for Version 5010. The sense of
urgency among clinical laboratories to plan for ICD-10 ranges from very urgent
to on the radar, but not much action. Some clinical laboratories have started
work on ICD-10 implementation, while others have not. The degree of completion
of ICD-10 impact assessments in the clinical laboratory industry, involving a
determination of the impact of ICD-10 on business processes, systems, and
trading partner relationships, currently ranges between 0 percent and 75
percent. The same range is applicable to the degree of completion of ICD-10
implementation budget estimates. Very few, if any, clinical laboratories have
received estimated delivery dates for ICD-10 upgrades from their vendors or
determined training needs or methodologies for their organizations. Virtually
all clinical laboratories expect to complete internal testing for ICD-10
sometime after March 2013.
Due to the unique clinical administrative requirements applicable to
clinical laboratories and the tremendous volume of transactions they process,
many clinical laboratories utilize internal software development resources for
both their laboratory information systems and their billing systems. The same
resource is needed for transition to Version 5010 is also needed for the
transition to ICD-10. Other contemplated HIPAA transaction and code set changes
such as final adoption of the proposed claim attachment standard and a National
Health Plan Identifier and implementation of standards for electronic
laboratory orders and results transmission being developed, harmonized or
adopted in electronic health record system certification criteria by
organizations such as HL7, the Health Information Technology Standards Panel,
and the Certification Commission for Health Information Technology.
The resources available to clinical laboratories to devote to these
initiatives are finite, and projects are prioritized and budgeted based on
their value to the laboratory. The current state of the economy has further
constrained the resources available to devote to these initiatives, and as a
result, progress in implementation of Version 5010 has been slower than it
would have been in the absence of these challenges.
Implementation of ICD-10 by clinical laboratories is generally subject to
the same effects of other high priority initiatives and the current state of
the economy as implementation of Version 5010, but to a greater degree. Since
the compliance date for Version 5010, another high priority initiative, will
arrive before the compliance date for ICD-10, and the same resources,
constrained by a down economy, must be used for implementation of both,
planning for and implementation of Version 5010 is currently given a higher
priority than planning for in implementation of ICD-10 among most clinical
laboratories. Consequently, progress in implementation of ICD-10 has been
slower than progress in implementation of Version 5010, and slower than it
would have been in the absence of other high priority initiatives and economic
pressures. However, a requirement to implement Version 5010 and ICD-10
simultaneously would have been far worse, and we are grateful that the
Department of Health and Human Services recognize the need for staggered
implementation of these standards and provided for additional time for
compliance in the final rule of adopting ICD-10.
The most significant issue facing clinical laboratories in the transition to
Version 5010 relates to how Version 5010 requires the National Provider
Identifier to be utilized. According to HHS, Version 5010 provides clear and
precise rules that clarify how and when the NPI should be reported. By
contrast, Version 4010 has been ambiguous on how to populate the NPI field for
claims transactions. Version 4010 is unclear as to whether providers should use
the NPI of the organization or corporation or the NPI at the subpart level, in
other words, the name and location of provider for providers with multiple
locations. As a result, while Medicare has required the use of subpart NPIs in
claim submission, most private payers have required the use of organizational
NPIs rather than subpart NPIs. Version 5010, however, requires that for
transactions with all payers, the NPI at the most specific level be reported.
This is a serious concern for laboratories in their claims transactions with
private payers because laboratories often have multiple locations. Some
laboratories have hundreds of subparts. As a result, transition to Version 5010
will amount to a major second round of NPI implementation that could dwarf the
first, since there are many more private payers than Medicare carriers and
Medicare Administrative Contractors.
As we experienced with Medicare in the initial implementation of NPI,
laboratories will need to work with each private payer to ensure that the
payer’s system loads the correct NPIs for all of the laboratory’s subparts.
During the initial NPI implementation, it often took several attempts and
several months for Medicare carriers and MACs to get it right, despite
re-enrollment of multiple locations by laboratories. New enrollment and
credentialing procedures will likely need to be implemented by private payers
and complied with by laboratories to accommodate this new round of NPI
implementation. Just as cash flow was threatened for many providers during the
initial NPI implementation, unless private payers work efficiently and
effectively with clinical laboratories, clinical laboratories could be
particularly susceptible to cash flow issues under this second NPI
implementation associated with the transition to Version 5010.
Further, given the significant number of changes involved in the shift from
Version 4010 to Version 5010, the importance of a reliable crosswalk that
assists providers, clearinghouses, and payers in transitioning from Version
4010 to Version 5010 cannot be overemphasized. Unfortunately, we have
identified several errors in the comparison document prepared by the Centers
for Medicare and Medicaid Services. A comparison guide with the type of errors
we have identified will only result in delays in processing claims by payers
and delays in reimbursement to providers. We therefore urge NCVHS to recommend
that CMS revisit the comparison guide to correct the errors that are present,
as well as to fill in the gaps where the agency has omitted necessary
Yet another issue relates to identification of patients and subscribers. The
Technical Report document pertaining to the submissions of electronic claims
within the 837 transaction format for Version 5010 indicates the following:
“If a patient is a dependent of a subscriber and can be uniquely
identified to the payer by a unique Identification Number, then the patient is
considered the subscriber and is to be identified in the Subscriber
Although current electronic submissions can reasonably accommodate such a
standard for Medicare and Medicaid submissions based on the understanding that
each Medicare or Medicaid number is unique to the patient, such universal rules
are not applicable for commercial insurance plans. Currently, without
electronic eligibility data from every electronic payer, there is no definite
way for the provider to know whether the subscriber number on file is truly
unique to the patient or whether the patient is a dependent of a subscriber,
sharing the same number. Knowing whether or not to convey that the patient is
the subscriber or a dependent of the subscriber is critical to establishing the
correct electronic structure for the claim. Not structuring the data correctly
is likely to lead to claim rejections, denials, or incorrect adjudication.
Therefore, this change in how dependent patients can be represented in
Version 5010 will force providers to understand how each plan will enumerate
their members, understand how each plan will edit against the
patient/subscriber data submitted on the claim, and establish plans and
corrective measures for new or increased rejections and denials related to this
change once Version 5010 is implemented.
These issues have increased the effort necessary to convert to Version 5010,
and have slowed progress toward that goal. While the transition to Version 5010
is not comparable in scope to the initial implementation of the HIPAA
transaction and code set requirements, the implementation issues associated
with it could result in adverse impacts just as significant as a failure to
implement the initial requirements would have been.
Many of the implementation challenges that clinical laboratories face in the
transition to ICD-10-CM relate to their status as indirect providers. The
specimen on which a laboratory conducts testing is typically obtained in a
physician’s office or other provider’s office and delivered to the laboratory.
Even if the laboratory collects the specimen, the laboratory has no direct
knowledge of the patient’s condition or medical record. For compliance reasons,
laboratories may not make diagnosis determinations for purposes of clinical
laboratory testing on behalf of the treating provider, but must instead rely on
the ordering provider to supply that information to them. The only circumstance
in which a laboratory can provide its own diagnosis code is where the
laboratory is offering anatomic pathology services through an employed or
contracted pathologist. In those cases, the pathologist renders his or her own
diagnosis with the pathology report.
Despite their inability to render or determine diagnosis codes for clinical
laboratory testing, clinical laboratories are required to submit diagnosis
codes in all electronic claims and in most paper claims to third party payers.
Ordering providers, however, are not currently required by law to submit
diagnosis codes in test orders to clinical laboratories, and missing,
inadequate, inappropriate or narrative diagnosis data requiring translation to
a code is not uncommon in test requisitions. As a result, after 30 years of
experience with ICD-9-CM, insufficient diagnosis coding data from ordering
providers remains the single biggest billing problem for labs. Front end claims
suspensions, rejections or denials of claims due to inadequate diagnosis
information requires follow up with the ordering provider and wastes valuable
resources. Based on their experience with ICD-9-CM and the increased complexity
and newness of ICD-10-CM, labs are understandably concerned about the potential
impact of ICD-10-CM.
Given the indirect provider status of clinical laboratories, the importance
of educating and training ordering providers and their office staffs on
ICD-10-CM cannot be overstated. ACLA is willing to assist in this effort and is
well-positioned to participate in outreach to the ordering provider community.
However, aggressive and creative outreach from CMS and other government and
industry organizations will also be needed to ensure adequate preparation of
the ordering provider community. Passive education and training methodologies,
such as posting educational and training material on a website, may be helpful,
but will be insufficient to achieve the goal of ordering provider competency in
ICD-10-CM. Periodic interactive webcasts or conference calls offered to provide
information and answer questions may also be helpful, but would not be
sufficient. This information will need to be pushed to the ordering provider
community to the point of saturation, in an appropriately timed manner, to
achieve the competency necessary for a smooth transition as of October 1, 2013.
The indirect provider status of clinical laboratories also affects their
internal training and hiring needs in the transition to ICD-10-CM. Currently,
when ordering providers use narrative diagnoses instead of ICD-9-CM codes,
appropriately trained laboratory personnel translate the narrative diagnoses
into ICD-9-CM codes. However, given the significantly increased complexity of
ICD-10-CM, laboratories anticipate the need to hire dedicated certified
professional coders to perform these translations in addition to training
existing translators, since the level of expertise needed for translation of
narrative diagnoses will likely exceed the capabilities of many current
translators, who typically have multiple responsibilities in addition to
narrative diagnosis translation. Larger laboratories may need to hire hundreds
of certified professional coders. It is already difficult to find certified
professional coders, and this challenge will be intensified if more doctors
increase their use of narrative diagnoses after the transition to ICD-10-CM.
Additional billing staff will also need to be hired to follow up on anticipated
increases in the rate of missing diagnosis data in test requisitions after the
transition to ICD-10-CM. These new hires represent permanent increases in
operational costs for clinical laboratories as a result of the transition to
For those clinical laboratories that offer anatomic pathology services
through employed or contracted pathologists, those pathologists will have to be
trained to use ICD-10-CM in rendering the diagnoses that they submit in their
pathology reports. The greater level of specificity in the codes will require
pathologists to more thoroughly document their findings to support the
diagnoses. The production of results during the transition is expected to slow,
which could result in negative impacts to patient care.
Like other providers, clinical laboratories will have to change any system
or data point that currently includes ICD-9-CM codes. For laboratories, the
impact will reach across all of their main information technology systems:
order entry, laboratory, billing, reporting, data warehousing, and client
products. This includes business rule development, programming, testing and
implementation for hundreds of internal software programs, as well as changes
with respect to screens, reports, requisitions, forms, interfaces, contracts,
and policy manuals. In addition, because ICD-10-CM codes are more descriptive
than ICD-9-CM codes, laboratories and other providers will need to develop
storage to accommodate the longer descriptions by making file and database
changes. These changes will also translate into the need for screens, displays,
forms, and reports that must accommodate drop down menus with new descriptions
with larger data fields. As such, laboratories will have to invest significant
resources to implement all of the necessary system changes to accommodate
However, again, the indirect provider status of clinical laboratories, as
well as the geographical reach of larger laboratories, intensifies the impact
of the system changes that must be made for ICD-10-CM. Laboratories will be
required to remap hundreds of external client interfaces with electronic health
record systems to accommodate ICD-10-CM in test orders, while also dealing with
the need for end-to-end testing with hundreds of payers and other trading
partners, although few such opportunities existed for end-to-end testing during
the initial HIPAA transaction and code set conversion.
As we have learned from past HIPAA transaction and code set implementation
efforts, sequencing and coordination of ICD-10-CM must follow a rational plan
to avoid systemic disruptions. Each past attempt to implement HIPAA transaction
and code set standards has required a contingency plan to avoid disruptions in
our health care system. In several cases, these contingency plans became
necessary as a result of not having an appropriate sequencing plan for
implementation. For the transition to ICD-10-CM, not only will the industry
need a rational test sequencing plan, but the massive scope of ICD-10-CM
implementation must be prioritized against other HIPAA implementation efforts,
such as, claim attachments and efforts to accelerate health information
technology adoption and health information exchange, such as meaningful use of
EHRs. It is important for HHS to emphasize that there will be no contingency
plan for ICD-10-CM so that procrastination in planning and implementation will
not turn the transition into a last minute panic.
Standardization of crosswalks and crosswalk implementation is important not
just for payers, but for clinical laboratories and other providers as well. The
General Equivalence Mappings for forward and backward crosswalks between
ICD-9-CM and ICD-10-CM are helpful in understanding general relationships
between the code sets, but as a practical matter they are insufficient because
they are not one-to-one comparisons. Further, to the extent that different
crosswalks can be implemented by different parties, and the same crosswalks can
be implemented in different ways, inconsistent results are possible. CMS has
recognized this issue on the payer side by developing a one-to-one
Reimbursement Mapping from ICD-10-CM to ICD-9-CM. However, indirect providers
such as clinical laboratories need a corresponding one-to-one mapping from
ICD-9-CM to ICD-10-CM for claim submission purposes for those instances in
which an ICD-9-CM code is received from an ordering provider when an ICD-10-CM
code must be reported to the payer.
While we recognize that it is more difficult to establish a one-to-one
forward mapping from ICD-9-CM to ICD-10-CM than a backward mapping, it would be
unfair to allow payers to use a Reimbursement Mapping while denying providers
the opportunity to use a Claim Submission Mapping. We would appreciate the
opportunity to work with HHS and others in developing such a forward mapping
that could be adopted industry-wide for use under prescribed circumstances.
Early adoption, late adoption and non-adoption of ICD-10-CM in non-standard
transactions, such as laboratory test orders, could threaten the ability of
clinical laboratories to process compliant claims. Early adoption of ICD-10-CM
in laboratory test orders, which the final rule adopting ICD-10-CM does not
prohibit, could seriously disrupt billing for labs that are not yet prepared to
Likewise, late or non-adoption of ICD-10-CM in non-standard transactions
such as test orders, which the final rule also does not prohibit, would
adversely affect the ability of labs to bill using ICD-10-CM codes for dates of
service after the compliance date.
While our educational and training efforts will seek to minimize early, late
and non-adoption of ICD-10-CM in test orders and other non-standard
transactions, and while we hope to further minimize these impacts through
standardization of crosswalks, regulatory changes may be necessary to address
the use of ICD-10-CM in transactions not covered by HIPAA due to their
potential impact on HIPAA-covered transactions. We would like to work with HHS
to find a way to prohibit, or otherwise effectively discourage, early adoption,
late adoption and non-adoption of ICD-10-CM in non-standard transactions that
affect standard transactions in which diagnosis codes are used.
The magnitude of the transition to ICD-10-CM and its many implementation
issues have inspired some laboratories to recognize the urgency of early
planning and ongoing implementation, which has in turn resulted in efforts that
have already led to measurable progress. Other laboratories appear to be either
less concerned about the transition, due to its October 1, 2013 implementation
date, or convinced that a contingency plan will ultimately have to be
established to extend the compliance date to avoid systemic disruptions, or are
so overwhelmed by the prospect of the transition that they are unsure where to
start, or are so hampered by current economic restraints and other more
pressing priorities, that they have not yet made significant efforts in
planning for or implementing ICD-10-CM and have therefore made little progress.
The scope of implementation issues facing clinical laboratories in the
transition to ICD-10-CM is significantly greater than the scope of issues
associated with the initial implementation of the HIPAA transaction and code
sets. The initial implementation of HIPAA transaction and code sets involved
existing code sets with which clinical laboratories, ordering providers,
clearinghouses and payers were already familiar, and implementation of the new
transaction standards was primarily a billing project with information
By contrast, the transition to ICD-10-CM, a new, restructured code set with
which laboratories, ordering providers, clearinghouses and payers will need to
become familiar, involves virtually every aspect of a clinical laboratory’s
operations, and will implicate fundamental business decisions of a kind that
were never necessitated by the initial implementation of HIPAA transaction and
code set requirements.
While planning for and implementing Version 5010, clinical laboratories will
be focused on ensuring that they meet the January 1, 2012 compliance date to
avoid interruptions in cash flow. Coordination of implementation with payers,
on a payer by payer basis, will be necessary to achieve this goal. Addressing
the NPI implementation issues associated with the transition to Version 5010,
together with testing, will be key priorities as labs seek to coordinate the
transition with payers.
For the transition to ICD-10-CM, clinical laboratories will be focused on
ensuring that they meet the October 1, 2013 compliance date to avoid
interruptions in cash flow. Training and education of ordering providers is a
top priority for clinical laboratories in the transition to ICD-10-CM, given
the dependence of clinical laboratories on ordering providers to submit the
diagnosis data that labs must submit to payers to obtain reimbursement for
their services. Other key priorities include appropriate sequencing and
coordination of ICD-10-CM implementation efforts pursuant to a rational plan;
standardization of crosswalks and crosswalk implementation, including the
development and adoption of a Claim Submission Mapping from ICD-9-CM to
ICD-10-CM; and the adoption of methods to prohibit, or otherwise effectively
discourage, early adoption, late adoption and non-adoption of ICD-10-CM in
non-standard transactions that affect HIPAA covered transactions.
The key risk areas for clinical laboratories in implementation of Version
5010 are inadequate readiness for testing and implementation on the part of
payers and information technology vendors, as well as payer-specific
interpretations and requirements relating to Version 5010. The inability of
payers to accept clinical laboratory subpart NPIs and load them into their
systems correctly and efficiently is also a major risk area.
The key risk areas for clinical laboratories in implementation of ICD-10-CM
include procrastination and inadequate education and training of ordering
providers; variations in payer adoption and adapting; absence of useful
crosswalks or variations in crosswalks and their implementation; changes to
payer coverage policies based on medical necessity, which could adversely
affect reimbursement; and inadequate readiness of payers and information
technology vendors for testing and implementation.
We commend the Subcommittee for holding hearings on the issues related to
planning for and implementation of Version 5010 and ICD-10, and encourage the
Subcommittee to continue to monitor closely the progress being made on
implementation of both of these standards. We ask the Subcommittee to carefully
consider the issues faced by clinical laboratories in these transitions as well
as the solutions we have suggested, and to make appropriate recommendations for
HHS to take action to address these issues accordingly in a prompt and
effective manner. Thank you and I look forward to your questions.
DR. WARREN: Thank you and just to make you feel better Don, you are the
second person to mention the problems with definition on subscriber and
patient. With that I would like to open it up to questions but I am going to
take prerogative and ask mine first then we will let Walter go.
The question that concerns me is this whole issue because all of you have
talked about your senior leadership and not only do they have everything coming
down with 5010 and ICD-10 but they also have the HITECH Act to continue with
and whatever health reforms got coming out with that and whatever the
regulations will be under meaningful use. Are any of your organizations doing
things to help the C-suite be aware and manage any of these initiatives?
MR. HORTON: I can tell you that at LabCorp our C-suite is driving ICD-10
DR. WARREN: That is good news especially after we heard from long-term care
that they didn’t know anything about this, which is one of the reasons why we
had you guys to get that. Anybody else? Especially Walmart. What do you see?
MR. TOWNZEN: From the executive sponsorship I think when it gets to the
technical pieces from our executives they are pretty much like let those guys
handle it. They all know what they are doing. I think once we comply it under
the compliance side it becomes a driven initiative.
DR. MILLER: From HIMSS perspective with our membership we are trying to
raise this to the level of not looking at individual efforts but all the
efforts together as really a strategic decision. If you can elevate it to that
strategic level, which is not very hard to do, I mean it’s long term, it is
enormously impact for all the organizations and it costs a lot of money to do
all of these together. The argument can be made there I think very effectively
with the C-suite around these are decisions that you need to be very much
DR. WARREN: My last question had to do with education, which I hadn’t
thought about until Don’s testimony, and that’s this whole issue of passive
education versus aggressive education. I would like for you to talk a little
bit more about what you mean aggressively pushing it towards the learner.
MR. HORTON: Well, when we look historically at what HHS has done in terms of
outreach and education related to HIPAA, it has been from our perspective more
passive than active. In other words, it has come to us and we will teach you
what you need to do. The materials that CMS and HHS have put together have been
good materials but they have not been pushed actively out to the community.
That is the difference I think for ICD-10 in particular to get to the level of
competency in ordering providers’ use of ICD-10 that is going to be necessary
to make this work. Not only CMS and HHS but everybody in the industry who has
an interest in this needs to be involved in outreach and education and doing so
actively, pushing data out and not just come see me.
DR. WARREN: My last question goes to Don but anybody can answer it is still
the concern about MPI and its implementation. Can you talk a little bit more
about the penetration of that? And Karen did you want to follow up on MPI? Go
MR. HORTON: I am not sure exactly what you want me to talk about.
DR. WARREN: What else needs to be done to make sure MPI rolls out as it is
supposed to from a laboratory perspective.
MR. HORTON: I think number one is to raise awareness that the issue is there
particularly with private payers that they are going to have to change the way
MPI is populated in the claims submission under 5010 in comparison to the way
they have been doing it because in the past and up to the current time they
have been asking and requiring that the organizational MPI be used rather than
the subpart, and with 5010 they are going to have to shift and begin to load
those subparts so they can be recognized in claim submissions.
DR. WARREN: That is what I needed clarification on was the big MPI and the
subparts of all of that. Walter.
DR. SUAREZ: Thank you. This has been a terrific panel. I am very impressed
with the testimony particularly the long-term care testimony. I really
appreciate that perspective. I get a major lesson out of this as basically that
while there are some overarching issues that affect us all and it is an
industry, there are very specific issues that affect specific segments or
sectors of the industry that we got to be very mindful of as we look at
discussing recommendations and looking at how to address all the transitions
that needs to be done over the next several years.
To long-term care I wanted to point out one thing. I think you were the only
ones across the board and I think everybody talked about all these challenges
and all these difficulties with all the competing initiatives that are going on
and all the noise that meaningful use is having and basically overshadowing
5010 and ICD-10. It was interesting that in your testimony you mentioned that
you are focusing on national health IT goals including 5010 and ICD-10. You are
actually including 5010 and ICD-10 as an element of the national health IT
goals and that is my question. Jeff asked in the previous panel if the previous
panelists could highlight some of the more detailed challenges between the
competing elements. I want to turn it around and ask what are the opportunities
really that people see with respect to leveraging all the things that need to
be done at the same time and not seen then as obstacles or competing challenges
but more as an opportunity to try to again leverage each other and try to take
advantage of all the things that are happening at the same time. That is my
first question to the panel.
MR. COBB: This is Dan Cobb. I will take a stab and I will try not to ramble
because we think about a lot of things as an industry and we are challenged in
that we are not always on the radar screen as far as national issues go. Just
to mention a few you mentioned meaningful use for example. The meaningful use
matrix has specific objectives and measurements for hospitals and physicians
but not this very large sector of care that we laid out here. The adoption of
technology to improve the quality of care and productivity and all of that is
at least as significant in this industry as it is in any other segment of
health care. One of the things we have been trying to do in addition — there
are several fronts that we are working. One of them is the standards and the
second being that there are — to get the adoption level where it needs to be
so that we can have the nationwide EHR and the information can be shared
amongst all care settings especially at that important transition of care. Our
industry needs a similar adoption centers and the same sort of focus as the
physicians and hospitals have. For example, having meaningful use to have a
component that is specific to our industry because our industry is somewhat
similar but also somewhat different and in paving the way for some adoption
incentives so that very similar criteria in interoperability and making sure
that you are making meaningful use of a certified EHR, all of that. But I said
I wouldn’t ramble and I am.
Answering your question that in addition to all of the standards and I put
the 5010 and the ICD-10 and the Continuity of Care Document, all of those
things together in the CDA. We are working all those fronts and we are just
trying to get our providers and it really comes back to our providers and the
patients and the residents, the care they need by getting them the information
they need by being able to share amongst all the care settings.
DR. WARREN: Some of the quality metrics that are in meaningful use metrics
are conditions that go on into long-term care. Are you looking at receiving
MR. COBB: We have actually done a crosswalk ourselves specifically to home
health and long-term care. Some of them are relevant and some of them are not
and probably more importantly there are some key measures within industry that
probably should be there. If someone is to make meaningful use of technology,
they should be measuring additional things that are on the matrix. We have been
working through that.
MR. RANSOM: This is Scott Ransom. I just want to add one thing. We talk
about the acute care setting. In the long-term care industry they spend
probably 10 times as much time in our setting as they do in the hospital and
with the physician. It is our job to carry out what the physician has started
and to Dan’s point there are a lot of things that is kind of an afterthought
for the long-term care industry. That is probably the biggest thing that I want
to bring awareness to is that we want to participate, but we are kind of left
to the side a little bit at times.
DR. MILLER: Joe Miller, HIMSS. I think there are great opportunities. You
take a practice that doesn’t have an electronic health record and has been
suffering with an older practice management system. There are going to have to
implement electronic health record and then in the process get a new practice
management system because for most practices they are tied together all in one
bundle that will hopefully meet the 5010 and the ICD-10 requirements. The
challenge is in the particular scheduling and timing of that potentially,
however, because you may end up with finding your perfect electronic health
record system, a practice management system but you have to meet meaningful use
in 2011 but the vendor won’t have the system ready for ICD-10 until 2012 and
now you are going to have to implement for meaningful use but then you are
going to have to upgrade in a year. That timing and that sequencing I think is
where the challenges will lie for some organizations. It is a great opportunity
to replace what you have or do a major upgrade with what you have for the two
things coming together.
DR. SUAREZ: Just one other question and I think it is probably the key
question around the timing in between the ultimate deadline which is January 1,
2012. It has been mentioned several times in points of the level I compliance
deadline across the board and across the testimonies on all the panels. But my
concern is that I’m not sure people understand number one what is level I
compliance testing, what does it mean, and number two when you have the
ultimate deadline of January 1, 2012, that is the deadline that everybody is
looking at. Everything in between is it will be nice to do this by this date
but it’s not seen as an official definite required by-law compliance deadline.
Is that your perception as well with respect to compliance deadline level I? It
doesn’t like a requirement, the perception that they are in. We don’t even
understand very well what —
DR. MILLER: I would agree. I think that it’s not viewed as something hard
and fast that you are required to have in place. I think to be honest though
another message that needs to go out there is that this is not going to be very
pretty if everybody waits until December 31st, 2011 to convert over,
and as a level I compliance indicates that trading partners can agree to move
to the standard earlier. There is an opportunity for a provider or a health
plan using their clearinghouse again I would say to actually convert earlier
than later and that is something that — it is hard to encourage with a
straight face knowing where we are in the industry right now. But if we have
everybody converting over in December of 2011 it is going to be pretty hard. We
need early adoption and that is a message around level I that I think is an
important one too.
MR. COBB: This is Dan Cobb. I will add that I also came here to learn in
addition to testifying. Our industry has been looking at the January 2012 date
but it is my take away to come back and make sure to spread the word about the
level I also.
DR. SUAREZ: One minor comment and I will finish up. I do want to acknowledge
the lab testimony was very helpful to highlight some of the major issues with
the current transaction. You highlighted MPI. The very first question I asked
and the very first panel yesterday was do we have any problems with MPI and I
kept asking it. I think you highlighted it. You pointed to one of two of the
issues with MPI.
Number one is the granularity level and number two is the fact that 5010 are
required that if you are a provider that is the rendering provider and you have
an MPI you have to put the rendering provider in the billing provider. You have
to be the billing provider too. That creates a big issue with respect to who
had originally — I have a clinic and the clinic has an MPI that the rendering
provider but my billing provider used to be this other entity or I have a
central business office that has a separate MPI, which MPI need to put in which
part. I think there is some big important education and potentially some big
challenges with respect to renumbering and reloading numbers with respect to
MPI and I think you highlighted some of the elements there. I really thank you
for that because I think there are some important challenges that we need to
DR. WARREN: Okay Justine.
DR. CARR: Following on the discussion about the labs another topic that we
may not have spoken about is conditional coverage of not just labs but other
services. There is a whole world of ICD-9 codes that are attached to payer
rules about when something is covered or not. I think you were eluding to that
that if there is no ICD-9 code; it’s the wrong ICD-9 code. Then it reverts back
to a self-pay. That is one side of the spectrum of the piece of work that I
don’t know if we have heard who is doing that.
The other part that made me think of in terms of payment in P for P, all the
patient safety indicators and quality indicators are all developed on ICD-9.
The HRQ pay for performance. Did we hear about that yesterday or is another
topic? I didn’t know if there was anything more in terms of the conditional
coverage and whether that would introduce a delay just getting that crosswalk
done by the payers and getting it done consistently also in terms of the one
DR. WARREN: I think that is one of the reasons why we are really glad you
are also on the quality committee so you can bring that stuff back and forth as
it bridges. Did you have any questions for any of them?
DR. CARR: I just didn’t know if there was anything more on the conditional
coverage on the labs other than what you had said.
MR. HORTON: Not really. There are significant potential difficulties with
reimbursement depending on coverage decisions that payers are going to make
because they got a completely different code set to deal with now and what was
perfectly reimbursable under a particular ICD-9 code that may map to 27 or 28
ICD-10 codes. It is going to give some payers some opportunities to pick and
choose, which are they are going to pay and which are they not going to pay. We
got to watch very closely how that works. Standardization say everybody is on
the same page with respect to how you get from this code to that code and how
it affects reimbursement is going to be very important.
DR. CARR: I think also it speaks to the learning curve for the physicians
who are putting that code on.
DR. WARREN: Jim.
DR. SORACE: I figure this in the HIMSS talk a survey mentioned but I think
sounded like about 10 physician offices that actually responded and so could
you maybe just summarize where they are at and what their state of technical
sophistication was going in.
DR. MILLER: I wish I could. I did not really analyze those down and
individually given there was such a small group. I don’t really have that data
for you today but I can get back to you with it.
DR. WARREN: Is that data, Joe, that you think you might get at HIMSS?
DR. MILLER: I think as I said the survey was a little bit limited in terms
of distribution. Our next phase is to expand the distribution of it. I think in
the next application of the survey targeting the April timeframe. I think we
will get a significantly larger sample, which will allow us to report more
comparatively between the hospital sector and the physician practice sector.
DR. WARREN: We would certainly appreciate receiving your summary when you do
that to add to this. We have five minutes left for a break. Anybody else want
to ask questions? We will give the panel anymore comments. Walter always wants
to ask more questions. Panel gets first choice. Anymore comments that you want
to make or make sure that we heard what you want to give us. Okay Walter, you
get the last one.
DR. SUAREZ: Thank you. It is indeed a question actually. Earlier in the
previous panel I think Sidney from AHIP was the one that highlighted as a
recommendation the need for a clearinghouse for post-implementation issues and
addressing post-implementation issues and I wanted to ask him and I wanted to
ask this panel now. Given the concerns that exists with some of the current
transactions, the Version 5010, the MPI issue that subscriber and we have 12
other issues embedded in different transactions, do you think there is a need
for a clearinghouse for pre-implementation issues? A clearinghouse where these
kinds of issues can be collected and handled.
DR. MILLER: Joe Miller, HIMSS. I think actually WEDI does a great job in
that role today and could continue to play that role. I would say that these
issues that when I think — one of our challenges with education is to focus on
those components that really are very impactful certainly in the provider
community and I think some of the material that has gone out has been — there
are X number 500 changes. Well, that is very difficult for folks to absorb and
a lot of those changes are documentation changes. Well, now you think there
aren’t any changes that you have to pay attention to. But I think Don brought
up some of the key central issues that if we can educate people around five
issues and then have a clearinghouse to respond to questions and further
discussion around those, I think that would be ideal. I think right now a lot
of the information is a little bit overwhelming when to be honest for 5010
anyway. There are probably a half a dozen to 10 components of it that will be
significantly impactful for a lot of the players in the industry. Not to say we
don’t have to dot the I and cross the T on every piece of it, but I think that
that’s an opportunity for us to focus a little bit more.
MR. HORTON: I would just agree with Joe. WEDI has served in that role very
well in terms of taking care of the pre-implementation issues. I think the only
problem there is whether or not they are perceived as an authoritative
clearinghouse source and that is where I think the government has to play a
role in perhaps adopting some of the positions that WEDI takes as this is the
MR. COBB: Dan Cobb. Very good point. I was thinking that exact same thing
because I will go back to 1400 companion guides and when we are implementing
the issues are generally worked out point to point and that is how you get all
this divergence. It would be very nice if there was an authoritative source
that we could work out some of those variations and maybe go from 1400 to 700
or something like that, but at least go in that direction.
DR. WARREN: I would like to go from 1700 to 1. Thank you very much for
informing us. This certainly has been a great panel. If I had to give awards
for goodness of panel, we would give one to each panel. You all have just been
tremendous. For everybody please come back at 3:25 and we will have panel 8.
DR. WARREN: — these hearings were kind of in the day with hearing from some
of the major consulting firms that are providing guidance during this whole
process and conversion. That is why you see the members of our panel. We have
Alec Dicks from Gartner, Mark Williams from Price Waterhouse, David Biel from
Deloitte, and Chris Handler from Ketchum. Again, we will go right on down the
row. Alec, you are up first.
MR. DICKS: Thank you. Again, my name is Alec Dicks. I am a director at
Gartner. I am joined by my colleague Tom Dowd who is a managing partner in our
public health care practice. I would like to thank you for the opportunity to
share our point of view on 5010 and ICD-10. The perspectives that we will share
today are a synthesis of the input that we get from our analysts who are
talking to many of the health care professionals across the US day in and day
out as well as some specific efforts that we have worked on with CMS around
preparing and supporting the regulatory impact analysis for 5010 as well as
more recently an environmental scan for 5010, 3.0, D.0, and ICD-10.
To describe that a little further in October of this year CMS engaged
Gartner to conduct this environmental scan to assess the industry planning for
the HIPAA Modification Regulations. The primary objectives of this initiative
are to establish a repeatable process and framework, develop a project plan for
ongoing measurement and monitoring, and conduct an early scan to assess the
progress within the industry. Through our joint efforts with CMS as well as
other partners like Ketchum who you will hear from later in this panel. We are
working to help them get a baseline understanding of where traction is being
made throughout the industry, provide some early detection on what the barriers
are, preventing progress, and provide insights on possible course corrections
and actions that can be taken to help reduce those barriers.
In support of the original HIPAA mandates, Gartner developed a methodology
called COMPARE. This is meant to help assess the compliance progress and
readiness. This methodology is proven to be a good barometer for where
organizations are in the compliance walk. We have used this methodology on
other initiatives, other systematic initiatives like Y2K and continue to refine
Through those lessons learned from use of the COMPARE methodology we have
tailored this particular COMPARE methodology for this environmental scan to
best batch what we described as the stepping stones that most organizations
take as they move towards compliance. The methodology is this centerpiece of or
environmental scan. It is also a methodology that our analysts used to help
provide insights to our clients.
To describe that a little further this COMPARE methodology is built on best
practices that are commonly used across industry. I will briefly describe some
of the steps that we include in the stepping stones. The first is orientation
and project organization. These are the project kickoff and initiation,
assessment and gap analysis where organizations are understanding what is
changing, the analysis and planning where the detailed project plans are
developed, the tools installation and application development where
organizations are either buying or using vendors or building out towards
compliance, and then the regulatory compliance testing, and then finally the
production system rollout where they are fully compliant and stable in a
For each level within the COMPARE methodology we have developed specific
questions that we believe map to compliance traits and compliance realities so
that we can better understand where the organizations that participate in this
are today, what challenges they are facing, and how they are progressing as
they move forward.
Along with the methodology itself Gartner has been working with CMS to help
create the right segmentation strategy and to break down the health care
community and the logical groups. The segmentation will help distinguish where
there is traction within the providers, payers, integrated delivery networks,
and clearinghouses and where challenges still exist.
Our research has included interviews, data collection, and other primary
research methods, which help us triangulate a point of view on the readiness by
segment. Also, note in the previous conversations there are a lot of other
activities like HIMSS survey and others that are considered as part of this
For this scan it is important to note the findings it will share. We are
still midstream on the first environmental scan. The findings we are sharing
here are preliminary. Some will not be a surprise to you affirm some common
perceptions. Others shed light on what we would characterize as priorities for
It is important to note the sample group that we are working from. We have a
balance pool of 70 senior health care industry contacts that represent the full
spectrum of the covered entities and that form a good cross section for the
health care community at large. From that sample group that we are drawing from
there are a couple of key criteria that we are using as participants are
identified. One is that they represent all the segments that I have previously
described. We are getting representation from those segments. It is
geographically diverse. We’re not just looking at one pocket of the US and they
include both small and large organizations.
All the participants that we have identified that participate are it is
elective. They opt to take part in this activity and they have a requisite
background and knowledge of the HIPAA modification regulations.
One additional note is that this is an ongoing process. The participants are
also asked if they are willing to participate in subsequent environmental
scans. As we move through the continuum towards the stepping stones, we are
able to use the pool that we had identified as a baseline and compare
progresses as progress is made.
With regards to the findings, as we look at where the participating
organizations are and where they are spending the majority of their time today,
it is clearly on 5010, D.0 and 3.0. Many of the organizations have fulfilled
those first two or three levels of compliance, which include the orientation,
the gap analysis, and are now in the process of developing the detailed plans.
Also important to note is that for ICD-10 the story is a bit different.
While there is progress being made within some organizations, many
organizations that we are talking to are taking a wait and see approach. There
is a different picture when it comes to ICD-10.
A second finding is as we have looked specifically at ICD-10 and we talked a
little bit or we heard a little bit about this in the previous panel, there are
a number of risks that crop up that we see as becoming more prevalent as we
move further into the timeline. The first of which is around mega processes
beyond claims, not getting the attention that is needed. A second major risk is
what we described as the ripple effect as organizations migrate towards the
ICD-10. The third risk is the coordination among covered entities will become
more strained as the timeline goes further if activities aren’t started
earlier. And then finally the remediation will become more complicated and
costly as the timeline continues.
On a whole, our observation is the efforts need to be made now to accelerate
ICD-10 adoption and to begin that ever important testing between business
partners in order to make the compliance —
In terms of what we have seen that is the primary drivers or barriers that
are preventing progress toward compliance the number one barrier has been the
readiness of the business partners to accept or send transactions. What is also
interesting about the list of top barriers is that the current state of the
economy is not on top of the list. It is a concern but more relevant is the
cost of remediation. As organizations are looking at ICD-10 and 5010, their
concerns are on the cost of remediation versus the overall macro effects that
the economy is having.
Also note were some of the areas that were more problematic in the original
HIPAA regulations appear to be less prevalent. Things like vendor preparedness
and senior management support did not show up as top concerns with the
participant organizations that are involved today.
In terms of the participants and their interest in new approaches to
communication they are looking for much more direct communication, more push,
and less pull, and they want the traditional methods of communication like
newsletters are not weighing in importance while others like the webinars are
increasing in demand. Participants are looking for increased levels of
transparency into the CMS planning and implementation and to summarize in the
words of one of the participants we want a real-time dialogue as they work
The final finding is where the participants are seeking the most help. As we
look and we reach out to these participants and we understand the barriers, we
are also asking where are the opportunities? Where can you use the most help?
As we look at the elements that they are seeking the most help, those include
not only education and outreach but also templates, approaches, and related
deliverables that will help them achieve that compliance in a cost-effective
manner. Some examples are crosswalks, the checklist, and documented approaches.
What we would characterize at the heart of the need for these tools is the
need for those standard interpretations and ways and means of having more
effective coordination with business partners.
A final note here in terms of areas for further exploration. As we are
looking into the next wave of analysis with the environmental scan and with
work that we are doing more broadly at Gartner. We are looking at the root
causes for those challenges and issues that are currently facing the health
care industry related to compliance. We are looking at which education and
outreach activities are most efficient and effective. We are looking at
mitigation strategies that help address those challenges and we are seeking
additional participants that will add to the baseline that we have started to
define and then finally we are looking to continue to learn lessons around our
COMPARE methodology and the framework that we are using to build into future
That is all I have for today. Thank you for your time and I look forward to
DR. WARREN: Thank you. That was very helpful. Our next one is Mark Williams.
MR. WILLIAMS: Thank you. My name is Mark Williams. Partner Price Waterhouse
and Coopers out of our Chicago office and our health care practice and very
much appreciate the subcommittee having us here today to share in this session
and important dialogue. I know that there have been a lot of comments made
today and certainly some common themes that have been shared by many different
aspects of constituents in the industry. It sounds like there was more of that
yesterday as well. The focus that I originally intended to talk through and I
think it is probably still relevant is that what are the some of the main
challenges that are arising across the parties as especially the early adopters
try to tackle ICD-10. Primarily ICD-10 will be the focus on my comments.
Our clients so far have said to us that generally they think they can handle
5010. They think they want to try to tackle that. They think in the timeline
that they have generally. This applies probably more to the large payers, large
providers that they can get that done internally in the timeline required.
Their bigger challenge and longer term looking out at ICD-10 especially because
of the business requirements they anticipate is where they anticipate their
bigger challenge is and need a longer run way to be able to get their arms
around that. That is the focus of the comments.
What are the some of the solutions being considered in the industry right
now with what I think give some perspective there as well. I am just working
from the slides that were passed around not the deck on the screen. At Price
Waterhouse Coopers of course it has a large health care practice. We focus in
payer provider and the pharma based. We started looking at ICD-10 and 5010 over
five years ago as some of the considerations were moving through the market. I
did some early papers and studies on that.
As things started to ramp up some early adopters actually did ask for help
actually before the regulation was passed. You began to do more and more
education and guidance for clients on what it looks like, the direction that
those regulations would like go and eventually did go. A number of clients
began more on the payer side have asked for assistance and understanding.
There are longer term challenges related to ICD-10 and the perspective they
are looking at it from is not just what is ICD-10 mean to us. It is really what
does ICD-10 mean to us in order to not sidetrack our business to remain a
strategic player in the market, not derail large strategic initiatives that
they may have. They are on a three to five-year planning realm. So really
trying to get the ICD-10 mandate and their strategic initiatives in sync, learn
where there is leverage, learn where there is a possibility to improve their
business, maybe get some business value. Possibly use ICD-10 as a catalyst to
move some of their initiatives forward. The alternative was that they didn’t
that ICD-10 would be a whole lot more expensive even just to become compliant.
Some clients again on the payer side are mostly what we are seeing there
with the ones that are a little ahead of curve is that they are actually in
business requirements right now. They finished a complete assessment. They have
a pretty good grasp of what their challenges are, business and IT. Business is
somewhere between 50 to maybe 60 percent of the total challenge from the
resource bend is what they are seeing. A lot of the comments here are
definitely seeing a consistent message there that we heard today that business
is a big part of ICD-10. Sometimes initially you hear the comment well this is
an IT exercise. That comment pretty quickly gets — you get a different
perspective as folks start getting into the details at least again on the
Some of the background that I will talk about today are some of the issues
that I want to focus on are some of the main challenges that have been
mentioned a number of times at some level here. Timeline challenges. Timeline
is a big consideration. Not the fact that you might necessarily move the
timeline but what is the message around the timeline especially relative to
noncompliance when the day hits.
Crosswalk and mapping. You can’t get into a conversation about this topic
without people immediately going to the crosswalk and the mapping. That is
probably the first 45 minutes of any meaningful meeting we have with a client
to try to get the crosswalk discussion on some kind of level playing field.
Medical policy and benefits is a huge area of significant downstream impact
that has to be considered and then some of the solutions that are coming to
bear. I am actually on slide 2 on timelines. ICD-10 work in the industry does
vary right now as you have probably surmised by now from action. Some of it is
aggressive. Some folks are fairly far along in their planning and business
requirements to really no activity at all. With certainly more significant
progress on the vendor and the payer side is what we are seeing from our
perspective at least.
We think the vendors realize that they need to be ahead of their customers
and we think the payers believe that they need to be ahead of the providers in
order to do testing on some effective timeline.
Organizations are having a difficult time with their planning and resource
estimates. First of all, the common term we hear from clients is that we are
tapped out. Besides the mandates, everything we need to do strategically, and
let alone the big variables that are coming down on health reform on the
insurance side is feeling a significant strain on what they can accomplish in
the next even four to five years. There is some concern or some quite frankly,
some folks betting on the fact that the timeline might not stick. Well, you
know what happened with HIPAA. We had contingencies. We had extensions. As much
as you remind folks that the comments from CMS so far has been to stay the
course, I think there is still some speculation out there that probably more
communication to the market would probably be worthwhile in the next few months
would be our opinion.
Providers generally are feeling overwhelmed. I was at a hospital meeting
before I came to DC yesterday. It is a pretty typical response that you hear is
that we have a lot on our plate. ICD-10 is way too far out on the timeline for
us to focus on. Just what we have to deal with RAC right now is enough to keep
us busy for quite a while.
They are looking at systems modernizations, areas like that. Especially
where they want to become more automated but it’s not the mandate that is
driving them to the timeline and they feel like they do have time to wait. We
hear that comment quite often, more often than we think we should. For what
that is worth.
Organizations are not convinced in a lot of cases that CMS — will they take
a hard line with noncompliant providers? It significantly impacts where the
payers are at right now. What they are going to do on their strategy that can
they or should they draw hard line when the compliance date hits to say claims
that should no longer have ICD-9 will be rejected. They are willing to take a
hard stand on that. I think they feel like they need precedent set by CMS and
work arm and arm with them as those events might occur as the compliance date
On slide 3 we talk about crosswalk. Again, it is hard to have a conversation
around this topic without crosswalk becoming a big part of it. Most of the
impact assessments that we have done and we have seen include some element of
crosswalk. I think we have heard earlier that crosswalk at a minimum is going
to be a valuable tool for back office functions, to translate history, to help
with trend analysis over time especially close to the transition period to help
with pricing and group experience. Actuaries will certainly be very interested
and how they are going to handle their data over time. Actuaries also have
other concerns too. If there are a lot of bumps in the system how will they
handle things like reserves and work with the states on what adequate reserving
is, trying to really figure out what the claims lag really is. If there is some
big disconnects and testing doesn’t go well and claims aging really starts to
increase in this process.
An initial question often is can we use crosswalk as a core strategy. Is
that where we should go? And a comment came up I think in the previous session
or the one before. There are organizations now that absolutely are considering
crosswalk as their strategy. Just so that’s clear. It seems to us that —
PARTICIPANT: Are you answering that or just making a statement.
MR. WILLIAMS: That is a reiteration of a whole lot of comments in the
industry. It was a continuum right now that appears to be developing and if you
look all the way to the left, you would say that is pure crosswalk and if you
look all the way to the left, that is pure native as we term it remediation.
But it does appear as though organizations are tending to migrate somewhat to
the middle now. Some combination of crosswalk, some combination of remediation
especially where there is not a one-to-one conversion of the code. The question
is where exactly in that continuum of organizations be October 1st,
2013. Most or all of them eventually needs to move further to the right. That
is how the timeline or just the whole continuum seems to be shaping up right
now, again, relatively early in the game.
Lots of challenges with crosswalks that are recognized about not only
crosswalk activity itself and the issue that might create with claims and
disagreements between constituents on either end of the claim, but also what
will happen with some of the back end data reporting, some of the outputs,
measurement and care incentives that the models is trying to be revised between
payers and providers to pay for better performance, lower cost, higher
performance, higher quality. If it is pure crosswalk strategy, what does that
do to the data validity?
Will there be a comprehensive industry standard for mapping? That is a
question and a desire a lot of folks put on the table on a very regular basis.
Mandate a crosswalk. Everybody has to use it. You can plug it into any tool
that anybody wants to create from a technology perspective to create the
functionality but the mapping, industry standard, no choices, every provider
type, payers, and vendors. Everybody does the same. That is what I believe,
what we believe we are hearing from our clients that they don’t have right now
and until they get it their strategy is going to remain somewhat in flux about
where they are going to go in that continuum.
There are often questions about DRGs as well. How will the DRG process be
handled? How will those conversions analysis in precedent be set on those as
well? Often a topic that comes up.
Slide 4. Medical policy and benefits. Medical policy again drives a lot of
what goes on in a payer. Some of it in a provider as well. Some of it is a
matter of what is in the policy. There are codes used in the policy for many of
the organizations. Significant downstream impact on what is paid for, to some
degree drives reimbursement, lots of downstream impacts, and an effort that
organizations are really needing to tackle very early in the remediation
because they need to give the organizations plenty of time to deal with new
policy set under 10 and then implement that in their overall implement
There is concern on insurance side that we have heard quite a bit. It is
about the quality of the coding. If the coding doesn’t get them better under
10, will we be any better when we get the purported benefits that under 10
versus what we may have had under 9? There is a concern there that the level
and the quality of the coding on the provider’s side must improve under 10 to
achieve those benefits. That is a variable that we hear quite often.
There is some focus on benefit structure. Will there be an opportunity to
improve benefit structure or get more granular with benefit structure and there
is some strategy developing around that on the insurance side? Employers are
looking at this. A number of our employer accounts are looking at what do they
think they should expect in the ICD-10 world relative to performance, level of
reporting performance standards, and the like. There is interest there and I
think they will apply some pressure from their side about what accounts will
I think that crosswalk strategy that is another area where the crosswalk
strategy comes up if an organization is significantly dependent on a crosswalk,
a more sophisticated benefit designs and processing are demanded in the bids
and RPs that come out in 2012, 2013, 2014. Organizations that relied on a
crosswalk will probably — could be competitive disadvantage as well. There is
a fair amount of consideration around that right now.
Some of the theme of our comments is really about bringing guidance and
direction to help on a more collaborative information sharing approach as
entities tackle this. I just rattled off a whole bunch of challenges. Well,
those are challenges maybe from slightly different angles but they are
affecting every constituent that is going to touch their implementation of
ICD-10, payers, providers, vendors, and the like. What a number of our clients
are doing in some of their associations they are developing things like guiding
principles. It’s not really a mandate. It’s not in the regulation but it is
precedent guidance, almost advice. What is the impact of maybe doing this or
that? We have studied different aspects of this and here is how if you take the
crosswalk approach, here is what that might mean to you. If you want to know
more about what the impacts are to medical policy of the more sophisticated
granular coding, here are some very specific case studies of how that might be
utilized to improve medical policy. Providing guidance, more visibility,
communication we think would be helpful.
Solutions and overall observations on slide 5. The approaches again are
varied. Will there be overall guidance and precedent and again principle set?
Can CMS play a larger role in providing direction? There are a number of areas
that tends to come up again on the insurance side. They very much realize that
they have to focus and be in sync with CMS at least related to the Medicare
side of CMS. Providers often look for direction from Medicare on how they
submit, how they process, the rules they follow. Payers are practical. They
know on commercial side that they need to be in sync with that. It could be an
opportunity to share information, share training, and share the direction that
is given on a similar timeline maybe from a similar source. Just an example.
Testing, again, a big challenge. When will folks be ready to test? In the
case of CMS could there be a more central facilitative testing some guidance.
Payers are concerned. It sounds like providers have the same concern in an
opposite way that will their partners be ready to test. If there aren’t
adequate partners to test with either because they are not ready or their dance
cards are just full when folks come to the table, could there be an independent
data possibly created that folks can test against if they can’t find the number
or the specific testing partners that they might need consideration there as
If you look at slide 6, we have put together just a brief, for example,
purposes some four quadrants that really lay out these particular challenge
areas or areas for consideration that I just went through. Just to reiterate
confirming the compliance date under timelines. More assurance that it won’t
move for us assured that we are staying on the timeline and that is the
timeline we will all meet together. There are some industry timelines that have
been offered. Would those be endorsed or other ones that folks can follow but
continue to remind folks that that is where things are going? How to deal with
noncompliance submitters and trading partners. Again, it affects how solutions
are being structured literally right now and as we go into 2010 on the
crosswalk guidance on using crosswalk as a core solution. Is it an alternative
at all? If it is an alternative what are the repercussions of doing at whatever
Single mapping source so that can guide whatever tools folks decide to use
to do any type of mapping back office or not. The DRG updates. Guidance on
that. Who will do it? What is the standard? What is the approach?
Freezing ICD-10 codes. We heard that today. The consistent comments that we
hear over and over again, folks believe that one year before and one year after
is basically a two-year period around the compliance date to freeze the codes.
It’s not just freezing of the codes though. Folks feel that even if the codes
are frozen and then everybody comes out of that on an equal basis, guidance is
still needed on how the update process will go, how folks should handle the
update process because there is some feeling that the update process could get
as off track just as quickly as the initial conversion could.
Benefits and medical policy. Provide outreach strategies in attempt to
improve the quality of code submission, maybe some monitoring and standards
around that. Code set analysis to determine whether there truly is benefit to
the codes specific medical case examples where coding the case under 9 and 10
where you can see the real advantage under 10. More examples of that.
Maybe a stronger role in being more visible and providing guidance on
provider education, remediation solutions. Maybe some acknowledgement of the
continuum of options folks can select, but again ramifications of being at one
end or the other of a continuum like that.
Suggestions for areas of collaboration. Again, that is the biggest focus we
think right now is define ways to get some common language going. Get folks on
the same page and more aligned because right now folks are typically going in
their own direction in whatever element you want to talk about.
What are the leading practices that are being developed relative to
approach, relative to solutions? How can all the stakeholders share that
information and collaborate? Possibly some central sources of information on
vendors. Organizations are pretty overwhelmed with a number of vendors
approaching them now with especially IT and technology solutions. If nothing
else is there a directory that can be developed of those? Should there be a
certification of vendors that want to claim their experts in ICD-10 especially
on the technology side and possible certification there. With that I look
forward to questions.
DR. WARREN: Thank you. David Biel.
MR. BIEL: Hello everyone. My name is Dave Biel. I am a partner in Deloitte’s
health care practice. I lead our ICD-10 service offering. I have been working
in the health care industry for about 15 years and I have been working on the
ICD-10 problem for three or four years and prior to that was focused on MPI and
HIPAA prior to that.
I am joined by my colleague Paul Roma who is a leader in our health care
technology practice and we want to talk to you about what we are seeing in the
industry. Our base of knowledge comes from work we are doing with a number of
health plans doing assessment projects and planning projects and also what we
are seeing around the provider segment as well.
We have four trends and then a summary that we want to talk through but I
think more importantly will be some of the questions and answers that you all
have. I have a feeling a lot of what we have to say — actually I know a lot of
what we have to say is similar to what we just heard from Mark and what Alec
has to present around a data-driven analysis to me personally is very
We have it back here. I don’t know if we can display it or not display it,
but I am page three. The first thing I would like to talk about is I think
similar to what Mark was saying. What we are hearing a lot from our payers and
from providers is that we are seeing essentially what I call a perfect storm or
a conglomeration of diverging priorities and ICD-10 is on the priority list but
there are a large number of priorities that are ahead on the list. The economic
recovery maybe it’s not first on the list but it is certainly there. Reform is
top of mind and I think the message on this page really primarily is when you
put these things together with some of the trends that we have seen around
HIPAA compliance in the past whether it is MPI or 4010 and precedents around
extensions or calm extensions or delays or contingencies, I think there is risk
around meeting the compliance date. That is just a point that we see and what
we are hearing in the industry.
Slide 4 talks about our — it’s not a data driven view, but it is our
perspective from the work that we are doing with payers and providers. Payers
are certainly first out of the gate and I want to focus on the green bars
rather than the blue bars because I think 5010 is going to figure itself out.
They are definitely challenges but ICD-10 is certainly the big nut to crack.
Payers are moving down the assessment path. They are certainly ahead of where
we see the providers are today. But as a whole it is my view point, our view
point is that the industry as a whole is behind the curve. Even the payers are
and we do a number of informal surveys with AHIP. We see a lot of payers
answering our survey saying we haven’t started the assessment work yet. We are
starting it. We are going to start it next year, et cetera. Even though they
look a little bit ahead here on the bar chart, I think as a whole the industry
is behind where they need to be.
We heard the wait and see thing just moving to slide 5. We heard the wait
and see phrase. Life science is primarily — what should be there are the
pharmacies. That is the term that we use. We should have translated it for you
Slide 5 is a big of a historical view of what we have seen and some of the
risks around the timelines in general around the CMS and HIPAA mandate and the
two risks that I want to talk about. In the past I think we have seen the
compliance date come very close to or we get close to the compliance date and
then there is a realization that a number of the covered entities aren’t going
to make it and then there is an extension period or a contingency period that
is announced. When we look at that possibility and I know we are not talking
about that possibility today, but if that were to happen hypothetically that
throws the industry into a dual processing mode. I think we have seen it in the
past. From an ICD-10 perspective that creates a mountain of complexity and we
hear it mostly from the payers, their concerns around having to deal with dual
processing and frankly they are going to have to deal with it for a period of
time regardless of whether the dates are met anyway because they will have run
off from overtime, et cetera around claims and other transactions. But if there
weren’t extension period in the industry we are in a dual processing mode, they
essentially have to invest 1.5 to twice what they would just to be ICD-10 ready
or ICD-10 compliant. That is one of the big risks that we hear out there and
that we quite frankly think is a real one that needs to be looked at.
And then I think the other piece to that is if that were to occur, the value
realization, the value around actually achieving ICD-10 compliance is delayed
because we all know the values in the granular data and getting access to the
data is going to take time even if we hit the dates because we have to amass a
certain amount of it to have statistically relevant sample to do something
with. An extension simply delays that for statistically significant period of
time. What we hear our clients saying is that if that happens and many of them
believe that it will happen whether they should or not they believe that it
will happen. They believe that arose a value proposition and I think that
throws the compliance dates further at risk.
That is a segue to a discussion about value and I want to talk about two
aspects of value and just to say it. I think we all believe there is value in
the new code set, access to granular data, and we show some overlap here just
what the proposed reform measures certainly will fuel, enhance, and otherwise
bring credence to anything that requires mining of more granular diagnosis and
procedure data. The reform measures we show here are examples but there are
obviously a lot of others around health, wellness, disease management, et
I don’t think anyone hypothetically believes that there isn’t value in the
new code set; however, if you go to slide 7 this is a little bit of an eye
chart but what it shows is — when we sit down with our clients and talk about
where you want to be on the value spectrum, how you want to use ICD-10 to
either further your business versus just be compliant. Part of the assessment
work we do with especially with health plans is to sit with the C-suite and
look at the chart without all the bubbles on it and say where do you think you
want to be and how do you want to use this because you are going to spend a lot
of money on compliance. Where do you want to be? How do you want to use this to
transform your business? Inevitably the senior VPs and the CXOs want to be to
the right. They want to be further on the innovator column, collaborator, but
over time what we find and what the chart shows is that after they do impact
assessment, after they understand what it is going to do to their business and
after they think about when the value is going to occur and some of the
variables that are beyond and out of their control such as provider coding
patterns and how long it is going to take amass the data and doing something
with it. And then add to that just the pure cost especially for the big
national payers. We find them moving to the left. It was cast around whether
they are going to be crosswalk or dual processing. This is more of a business
value view, but we see them moving more toward the left over time and we are
just starting. I think our point of view is that if the value proposition isn’t
accepted by the constituents then the value proposition is going to be eroded.
Slide 8 is a discussion around the magic crosswalk. That is what I like to
call it because that is what our clients call it. It is the silver bullet. It
is the magic crosswalk. It is the thing that is going to save us. Obviously you
all had a lot of talk about it and a similar story what we hear. You don’t walk
in the door and sit down with a meeting with someone without talking about when
we are going to get the crosswalk and how hard is it going to be to achieve. I
think when we look at the crosswalk as or map — you can call it mappings or
crosswalk or whatever you want. In conjunction with the slide around extensions
or delays we believe that whatever the transition period looks like around 2013
there needs to be some tool set that will help buffer that transition and a set
of mappings would definitely help do that. A set of deterministic what I call
deterministic by directional and automatable mappings. I don’t think we are
quite there yet.
If you go to the next slide we have done quite a bit of looking at the
general equivalence mapping is some of the tools that vendors have out there. I
think the bottom line is that we don’t have a complete deterministic set of
mappings today. I think there is a question to me about whether it is
achievable to do that across the whole industry and that the unmapped codes are
difficult and complex to map and that all of the mappings whether they have
already been cast through the GEMS or not have to be reviewed by individual
constituents to understand what the impact of those mappings are in a
dual-processing mode to their revenue stream, to their patients and their
members, et cetera and actually map those through their value chain to
understand what the business impact is.
What we see happening is that everyone wants to do a little bit of their own
thing. I guess our view point, my view point is that if everyone does their own
thing we could be in a state of disarray if everyone is mapping a little bit
differently and a little bit of difference can make a lot of difference from a
revenue perspective or from a cost perspective or from a service perspective.
We think there needs to be a more concerted cross sector, cross functional
effort that has all the constituents involved to figure out whether we can get
to a standard and if we can get to a standard that is much more deterministic
that we can get providers, payers, states, government, everyone to agree on
something that is more deterministic. That would at least provide a buffer
contingency for us to fall back on if we need it.
There are some grass roots efforts that we hear about of constituents
wanting to get together to figure this out, but it’s not moving fast enough. It
is going to take at this rate it needs to be faster and cross sector and figure
out whether we can get there or not. That is our view point.
Slide 10 is a summary and a pretty picture to say that there is a lot of
change. There is a lot of change planned over the next four or five years and
with all the variables at least in our mind there is a question around whether
all the constituents can absorb all that change if we don’t lock down and get
ahead of some of the questions or risks that are out there. With that I think
we can move to questions.
DR. WARREN: Let’s go to Chris Handler.
MR. HANDLER: Thank you. I have a presentation. I am Chris Handler. I am
Senior Vice President at Ketchum. We are a communications firm here based in
Washington, DC and we have been engaged by CMS to help with the communications
about the ICD-10 and Version 5010 transition. I am going to speak today a
little bit about what our current plans are, where we are in our planning about
communicating the transition, and then to go over some very recent focus group
testing results that we have hopefully to corroborate what Alec and Mark and
David have said and also I think demonstrate the need that we see to
communicate this on a national basis.
We have been engaged by CMS Office of E-Health Standards and Services. As I
said we are a communications firm and we are going to be with the outreach on
the transition. We were engaged in July through a competitive bidding process.
We have been working on this for about six months now.
The goals of our campaign obviously are to ensure that every as we say
affected entity. Everyone who is going to be touched or who is visibly affected
by the transition to ICD-10 and Version 5010 is aware of the transition and
makes that transition successfully.
The objectives of my communications convenes specifically are to really
build national awareness, to engage partners and various stakeholders. Those
interested organizations who reach the constituents that we need to reach and
who can help that we can work with to help carry out this message and assure a
successful transition. We are going to be developing some targeted educational
products to really help in assisting the transition and helping people find the
resources they need to make the transition successfully. And then an ongoing
part of the process for the communication is to assess our outreach results and
we will be working closely with Gartner and really helping to make sure that
what we are doing as the process moves along as various constituents become
compliant that we are reassessing our messaging and making sure that we are
moving everything to those audiences that are still lagging behind.
Just briefly when we take a look at this, we are looking at three major
groups. I think you are probably very familiar with this. We basically broke
these groups down into providers, payers, and vendors. But some of the things
that have became very clear as we started to develop this plan is that it is a
really a diverse audience breaking them into three major categories is a very
sort of growth. We had to look at things. There is a lot of sub-segmentation
based upon — there are gaps in knowledge and preparedness, size of practices,
size of companies, locations, specialties and that we have had to take all this
into consideration. While there has to be a national main focus, there really
has to be a lot of sub-targeting of messaging to make sure that each of the
various concerns of these various groups is addressed. One of the texts that we
really want to focus on is as I said working with intermediaries to reach these
target audiences. We expect at some point later in the process this will become
a consumer story as well.
This graphic really sort of illustrates in very simple the various elements
of our campaign. With our target audience of these three groups we have broken
this down into these five components. First developing materials and these are
really sort of general materials to direct the entities to the resources that
they need to make to technical change. We’re not really working on the
technical aspects of things like GEMS or crosswalks but more on those tools
that groups need to find those materials.
Earned media outreach is very often a component of campaigns that we work
on, education campaign. This really means working with reporters to discuss
this issue in various aspects of this issue so that we get out to the general
public, the trade media, really spread the word about this program and help
raise awareness in that way.
A smaller portion of what we will be doing will be a paid media component.
This will probably be targeted mostly towards trade, publications to reach the
professional audiences. This is not going to get a large of this campaign. This
will rely mostly on earned media and the next segment, which is stakeholder
engagement. This is really working with groups that I am sure you have heard
from over the last few days, large professional organizations to engage them in
things that they have been thinking about I’m sure already in regards to ICD-10
and Version 5010. They have access to those constituents that we want to reach,
really develop partnership to make sure that we are all saying the same thing
for helping move the transition along.
The final portion really is conferences. Since this does have a very large
professional component, we look to conferences both as a way to reach these
audiences and look for opportunities to talk about the ICD-10 and Version 5010
This is a very simple timeline to sort of describe what we have planned. As
I said we are engaged in this late this summer. We started in the fall with
really preparation. This really was taking a look at what we saw as the
communications landscape, what had been said, what was being said by various
stakeholders and CMS and start to look at how what we need to communicate and
how we are going to do that.
We are currently in the next stage, which is the research phase, and from
there we conduct formative testing to take a look at the messages that we have
developed based upon the landscape research, see how they actually test with
target audiences. This is not exhaustive as you will see. I will discuss in my
next set of slides. This isn’t really a quantitative analysis. It is more
qualitative. It gives us a sense of what we hear when we talk to these various
audiences and then use that information to really start develop materials that
I was talking about.
We are planning on then moving to the next phase after the first of the year
and that is launching the campaign. This will be moving out to the general
public but to these audiences, launching the campaign, engaging the partners as
part of the campaign process, and then conducting media outreach and materials
That will then lead us into the final phase for this year but what will be
part of an ongoing process and that is ongoing outreach and that will really be
communicating with all of our various audiences through all of our
intermediaries and that process will continue until compliance, the final
compliant dates. It will be an iterative process in which we will continue to
research on a periodic basis, probably once a year, look at how various
audiences are responding in terms of their change of attitudes, where they are
in their readiness, and then focusing on different audiences that may still be
lagging behind. The idea really is to make sure that we are focusing on those
audiences of greatest need and then as those audiences become compliant and
more aware of moving on to other at-risk audiences.
Now I am going to discuss in the next set of slides some formative research.
This really helps us to get a sense of what we think is the correct way to
reach out to constituents whether or not any of those messages are going to
resonate. What we want to take a look at in this research was really what
people’s familiarity was with Version 5010 and ICD-10, what their response was
to hearing about the transition, testing some messages and logos, tag lines,
elements of the campaign that we would communicate to them on a regular basis,
and then really hear back from them how they like to hear about this
information. What channels do they typically use?
Very briefly I’m not going to go into this in detail but the design of the
testing that we did was a combination of focus groups and what I call in-depth
interviews. This really gives us a sense of what groups are saying and what
individuals are saying, their particular reasons why you would do one over the
other. But the way I broke it down was the smaller group, individual
physicians, local physicians, smaller physician practices, those we spoke to in
a focus group setting. For the larger organizations, larger payers, larger
hospital systems, software vendors, those were conducted in in-depth
interviews. And one of the reasons this is done is for reasons of proprietary
information. We find that we can get more candid information from a software
vendor who may be developing a system if he knows we are talking to him one on
one rather than a group setting where he may not want to develop information
that he feels may be proprietary. And as it notes on the slide these groups
were conducted in a diverse number of areas across the country and those are
completed. The interviews were at the time of this report were about half
The key conclusions. First off knowledge of ICD-10 right now is low when it
comes to small organizations. With small practices, local physicians it was
actually shocking how low the recognition about ICD-10 was, almost never
condition of what the dates were for transition or compliance. Some groups
hadn’t even heard about ICD-10 before. When it came to Version 5010 the
understanding was extremely low, which was not surprising considering that this
in many ways is a back hand part of the system.
When it came to the larger organizations the knowledge was noticeably
higher. Many of these organizations already knew about this, had already done
an assessment, were already in the planning mode, and so were clearly farther
along in the process to making the transition.
When it came to current attitudes. When it came to small physician groups,
we really felt they had a wait and see attitude. I see some smiles and I think
maybe from this quote we haven’t been told about this and we will react when we
hear about it. That really summarized what we were hearing from a lot of the
smaller groups. It is really about my payer will tell me about this. My
software vendor will tell me when I need an update. I don’t need to worry about
this until I hear about this from someone. The expectation was that CMS,
vendors, large providers would let them know when they need to make a
transition and when that needed to happen.
When it came to the range of reactions to the transition, there were
commonalities between smaller groups and larger groups. There was obviously the
worry about the cost of the transition both in funding money and time and some
skepticism as to the value of making the transition. From there, there was a
break down. From amongst the smaller groups there was a degree of surprise and
anger about having to make this transition and some paranoia. There were some
providers who said this is an effort to make me switch over to more advanced
health IT in general, that this was an effort to try and reduce the amount of
money I will be reimbursed for my services. Less of that from larger
organizations who I think since they were further along in the process was more
accepting of the fact that this transition was coming. They need to be
compliant. More focused on what they needed to do because they were in the
planning process already. Although still there seemed to be a failure to
recognize what value they would see in the transition.
The next thing that we like to ask when we are developing messages is we
like to focus on benefits. This is really taking the approach of carrot versus
stick. We like when we are messaging to say this is the value you will see with
this transition, this project. And in general the results whether it was focus
groups, with smaller providers, or in-depth interviews with larger
organizations, they didn’t believe that there were any benefits. They thought
that they were irrelevant. They didn’t actually believe that they would occur.
And actually would cite that presenting benefits to the transition was somehow
a diverting tactic. We found that within the environment of the focus groups
this actually would distract participants from focusing on other key messages.
If we tried to say really there are benefits about this, let’s discuss this, it
would completely take away from other important messages such as they need to
take immediate action. They need to start assessing their risk and thinking
about how they are going to make the transition.
Audiences responded better when we actually acknowledged. We understand this
will be a lift for you. There is going to be an impact in terms of cost, in
terms of time to make the transition. Then we had a better response from the
participants then we could pursue the discussion at that point.
When we talked to them about what information do you need to hear, key dates
was very important. They wanted to know what do I need to do and when do I need
to do it. As I said the awareness of the key compliance dates was very low, but
they also wanted to know about intermediary dates. Are there other dates that
we need to know about testing other transition points? In general they wanted
to know what they need to do. Is there going to be some sort of plan for me to
make this transition? They wanted to know where they can find the information,
and it was important to them that this information comes from CMS. There were
groups and individuals who said as I have mentioned my payer will tell me when
I need to make the transition. My vendor will tell me when I need to make the
transition. But the larger portion said CMS we know is a trusted source. We
want to see that information comes out it comes from CMS. I won’t throw it away
if it comes from CMS.
Regarding to how communicate we found surprisingly there was quite a mix of
both as we characterize at high tech and low tech methods that people
requested. Some were very focused on this is health information technology
issue. We want to hear. We want to be able to go to the web. We want to get
emails. We want online trainings about this.
Others were the complete opposite. Others said we want to receive a mailing.
I want to get some direct mail piece that I can hold in my hand and see this is
what I have to do. Or focus on things like conference calls, hearing this
information from their hospital if they belong to a hospital group, conferences
or CMEs. All methods that were discussed as ways to communicate this
information, which said to us that we have to make sure that when we do our
outreach that we have a diverse set of tactics and channels to push this
In summary, what we concluded from this was that there really were three
main drivers. It is the low awareness about the transition. The low
understanding of key dates and this need and desire for educational resources
and support. Those are really the three things that we are looking at right now
that say to us there is a need to continue with a large scale national campaign
to really drive this information out to affected audiences.
In terms of next steps in our planning we are now that have the focus group
results beginning to finalize our initial set of materials. As I have mentioned
we are planning on launching the campaign after the first of the year and then
implementing ongoing outreach throughout 2010. Then reassessing efforts in
coordination with Gartner and the other contractors based upon changes in
levels of awareness and then revising and refine the strategy. Since the
compliance states are a number of years off we want to make sure that we are
continually refining our tactics to make sure they always stay on point
throughout the course of the campaign. That concludes my presentation.
DR. WARREN: Okay. I already have a list of questions. Again, I’m going
PARTICIPANT: Are they good ones?
DR. WARREN: Well, I don’t know. I am still concerned about crosswalks. One
of you said that there were 19,000 codes that didn’t have a match and that
people were concerned. They wanted a map to ICD-9 and I guess the clinician in
me just goes wow. We are going to turn away from 19,000 opportunities to
describe our patient and we are going to force fit them into basically the old
Procrustean bed. If they don’t fit, we are going to cut them off or lop them
off until they do. That strategy just really bothers me when we went to ICD-10
so we would have a more descriptive terminology. I just needed to say that. I
don’t know if anybody wants to respond to that in the committee or not but I
think that is probably critical to everything we have heard is that people want
to keep the ICD-9 core and then just look like they are doing 10 with these
crosswalks. Open to comments.
DR. FITZMAURICE: Just a quick comment and that is that if there were a
perfect match we wouldn’t need ICD-10.
DR. WARREN: That is why I called it a Procrustean bed. Panel respond.
MR. BIEL: I know where that number came from. That was an old version of our
deck and I’m not sure that number is completely accurate and what you said if
there was a perfect match, we wouldn’t need ICD-10. I think the attempt at
least the way I view the attempt to do mapping between 9 and 10 it’s in my
opinion, our opinion is that we need to do it to get through a transitional
period. It’s not about the clinical relevancy of the data but it is actually
about getting the industry through whatever that transitional period is revenue
neutral and everybody remaining whole and then once we have that then we can
move on to — all that time we should be — we are doing core administration of
claims and transactions and all that stuff using a crosswalk potentially to
help us while we are making the full transition for those who can’t make it.
In the mean time we are actually collecting the data that is coming in off
the raw transaction. We can still be amassing the ICD-10 data but relative to
keeping things on an even keel and everyone processing and moving forward the
purpose in my mind of the crosswalk is to just keep the transactions moving
ahead and not affecting members, providers, health plans, et cetera and then
once we are through that transition then we will have a set of data and we can
move on to a full ICD-10 world. To me it’s not about the clinical relevancy of
the information. We are going to get there, but we have to recognize that there
is going to be a transitional period and that is the purpose of backward or
MR. WILLIAMS: I would just add to that that there seems to be another one of
the guiding principles that seems to be forming is that I agree with what David
said in that focusing knowledge that from a data perspective and what you can
really learn from ICD-10 will no doubt be cumbersome for a lack of another word
for a couple of years. The data will be rough during the transition. Let’s get
through the technical part of it. Let’s make the conversion and hopefully
within a relatively short period of time but not right away we will have the
more granular and more accurate and more robust data that we want but that will
not happen immediately after October 1st, 2013.
MR. BIEL: I guess the only other thing I would add is I don’t think — the
crosswalk for some organizations I will say for some. The crosswalk is a
necessary evil because they literally have thousands of systems to remediate,
hundreds or thousands, and it just might be physically not possible to get it
all done. And a lot of them aren’t vended systems. They are legacy system and
they have to go — it is like a Y2K problem. I think somebody said that before.
We could throw bodies at that but that doesn’t mean we can get it all done.
DR. WARREN: I have Marjorie, Justine, Harry, and Jeff.
MS. GREENBERG: I really want to thank all of you for your testimony and it
was very thoughtful. I would say it was in some cases sobering and in even
other cases morbid. I guess people in classification we talk about morbidity.
That was the word that came to my mind, morbid. But as I said yesterday at the
end of the day and I don’t know if you were here or not but that I tend to see
the glass is half full rather than half empty and with so many bright people we
have heard over the last two days that I am encouraged that we will get through
this. At the risk I don’t want to pick on our colleague here from Deloitte but
there were two slides here — your testimony was excellent. Your slide 3
clearly was depressing but of course I loved your slide 6.
I will tell you where I am having this disconnect and it is related actually
to these two slides although I think you really have to parse this out and
there are so many different pieces of it and I think that even those of us in
this room don’t certainly I don’t fully appreciate it so why in the world would
we think that most of the people out there in the industry do appreciate it.
On the one hand I am hearing that the providers they may not be able to have
the sufficient information to actually code an ICD-10-CM. That is one whole
issue. Taking what information is available in the record and coding it to
10-CM and 10-PCS.
But then there is this other issue, which I think from what you said in your
last comment is the bigger one and that is having all your systems take
advantage of the new code sets assuming that we accomplish the first one where
everybody really — because we heard yesterday that there is a lot of training
out there. That people who are responsible for training people in the ICD-10
code sets feel that they can meet the challenge et cetera. Even if you have
that data then you have all your systems. That is where you are talking about
well maybe using these crosswalks.
This is where my disconnect is and there is another thing. There are two
parts of it. There is the IT part, which is having a transaction be able to
receive ICD-10 codes so that’s the 5010. Everyone says well we think we will
slog through. We will probably get to 5010. That part of it is going to happen.
The other part is being two parts, being able to code to this higher level of
granularity and then the other third is having all your systems take advantage
My disconnect is that here in slide 3 is says everyone is giving a lot of
priority to HITECH and stimulus and all of that and I think what is meant in
there is electronic health records and some of those — at least for providers
that is the big part of HITECH. Classifications are an aggregation. Even as
granular as they are they are not nearly as granular obviously as terminology.
And what I don’t understand is how anyone thinks they are going to be able to
meet the requirements for meaningful use of electronic health records if their
document or what’s in their records isn’t even good enough to produce ICD-10-CM
and ICD-10-PCS codes. If it isn’t then they are dreaming if they think they are
going to somehow meet the requirements for meaningful use of electronic health
records. That is where my disconnect is. That is what takes me back to your
slide 6, which says we are going to have to get a lot more granular if we are
going to electronic health records and ICD-10 just will fold right in there
with it because we are going to have to have that level of documentation
My answer to what do you do with a condition that there isn’t ICD-9 that you
can code 10 but you can’t code in 9 is use the documentation in your records to
code in 10. Don’t try to force it back into a non-specific 9 code and that
would be less compelling if we didn’t have the electronic all the stuff above
the line. I may be really naïve and just missing the boat here but that is
where I am ending up.
DR. CARR: Maybe because we are sitting together I want to build on that
before we open it up to discussion because I think I agree with what you are
saying but I have a little different spin. One communication issue I think that
is very important for the clinicians is that we have to reconcile the message.
A lot of the message that goes out to the docs is once you get to electronic
health record you have primary granular data and HITECH is all about this. We
are saying to them abandon coding and just write it in the electronic health
record in a query able field and we will be able to know very clearly what is
going on, and then this is saying actually we are going to go with
administrative data but we are going to make it more granular. I think both are
true. I think you need that redundancy with the granular data but I absolutely
think that we have to reconcile this message because there are two different
paths and the way they are spoken about is very different and we need to show
them that the granular data helps you achieve one set of information and this
data helps you with the other.
My second point is that the common denominator in the outpatient world is
the physician. The physician learns how to do the electronic health record and
they learn to type in the fields that they learn type in some cases and then
type in the field and put that in. I am just saying. Welcome to my world. My
question is have we ever done an assessment of how many codes a doctor keeps in
their mind because my experience is they know about 35 codes that relate to
their field. Now we are going to go from 8000 whatever that they don’t use or
16,000 that they are not using and we are going to go to 60,000 that they may
not be using. In the world of outpatient your single common denominator is a
doctor who remembers 35 codes. If we think that we are going to get rich
granular data there we have to have another decision support or implementation
or a new model that there is a coder. On the inpatient side you have coders and
they can read medical records and for those 4.2 days worth of admission they
can come up with 60 codes but for the physician who knows 35 codes for that 15
minute visit they will come up with one or two codes. If we are to achieve the
richness and the value of this granular data, we have to do something to help
the physicians so that they don’t become the bottleneck between the 60,000
codes and the application to a patient.
DR. WARREN: Let me add another level of complexity. Meaningful use grid in
2015 is already talking about requiring SNOMED, which is really granular, and
some of the beliefs behind that is if you get the really granular stuff, the
physicians will document and all the other health care clinicians will document
what they are really doing and then let the magic of queries and everything
else and data analytics. I didn’t want to map. The data analytic stuff, roll it
up to ICD-10 or whatever else you need and not only SNOMED but also LOINC and
RxNorm will be thrown into that mix. Can we let them answer now?
DR. CARR: But just to know what they are supposed to be learning. Is it
SNOMED? Is it the individual fields or is it ICD-10?
DR. WARREN: My preference is the doctor would not have to know SNOMED that
their vendor would provide it to them as needed. That is my view in working
with it. We will open it up. Justine, was this your question as well? We will
open it up to the panel to respond to this dialogue between Justine and
MR. BIEL: The one that I lock into is coding. You are talking about coding
patterns and then learning. It is funny that you picked the number 35 because I
always say 40. Providers have their 40 favorite codes and what is going to
incent them to — and that’s when we talk about the value. When we showed that
picture of sliding to the left, that is part of the discussion with health
plans is how I know. They always say they are going to maximize for
reimbursement and they know their favorite codes for reimbursement today so
they are just going to pick their new 40 favorite codes for reimbursement
tomorrow. I agree that coding patterns and adoption or call it adoption by the
provider segment is — if that doesn’t happen there is no value. There won’t be
value. I’m not sure if I answered your question.
DR. CARR: In Europe what is the European experience?
MS. GREENBERG: In Canada I know that they have found that their data is so
much richer with ICD-10-CA, which was their modification than it was with 9 or
9-CM, which is what they were using.
DR. SUAREZ: (Not on mic) — from 9 to 10 because they — for over 5 years.
DR. CARR: Is it that their doctors have 400 codes or they have a coder who
codes the outpatient experience as you have with the coder on the inpatients?
MS. GREENBERG: Although I would have to say that I don’t think there is any
country that does at much outpatient coding as we do.
PARTICIPANT: Or a physician office.
MS. GREENBERG: It is true. And they probably found a lot of the benefit has
been in larger in hospitals and also in maybe outpatient clinics where there is
MR. ROMA: This is Paul Roma. I was introduced earlier. I lead our technology
practice across health plans in the health care community. I have worked in
Canada with ICD-10-CA as well. They actually do have specifically coders that
translate essentially the hand writing — typing, the hand writing that comes
in from the 40 to 50 codes if you will, and they do not do nearly as much
outpatient coding. It’s not even a close comparison.
Most of the benefits actually do come obviously within the inpatient world
as we have been focused on here. Part of your question I locked in on was the
difference between an EMR and the administrative codes and the administrative
side of the diagnoses. Their system in ICD-10-CA actually combines those two.
Because of the unification of the single payer, they don’t have disparity. A
lot of our discussion still processing — they are not thinking or they don’t
have any of those friction points. To them when a person codes in they go
straight from the clinical relevant data from the episode or whatever the case
may be, directly to diagnosis and it is all the way through.
Their changeover was literally one to the other. It wasn’t a stepwise
function. It was a direct changeover and you train someone to data code one
thing. They code something different the next day because they already have the
unified model around the EMR systems and reimbursement isn’t actually an issue
because they don’t have traditional things that we use. I think it is a
different model and we can learn from it though. There is a lot to learn from
it. Did that help? You did ask a lot of questions.
DR. CARR: I feel that with these figures they are very helpful, but we have
to think about it as where is the ROI because if really the richness and the
granularity comes from the inpatient understanding then the PCPs who are
working on documenting the EHRs should not feel that they now have to expand
their 40 codes to 400 codes because it’s not going to happen and we shouldn’t
have that expectation.
I think we need to say that the richness and the learning will come from
inpatient and that is okay, but actually we heard a lot today about post acute
care and all that. I guess that is my thing is that we have to have the doctors
understand what is the effort and where is the benefit. The benefit is maybe
not so great on the outpatient side of their coding whether they do it in ICD-9
MS. GREENBERG: But the thing is in the hospital you have the full range of
conditions whereas just as you said most clinicians — there are specific
challenges obviously for primary care or even a lot of internal medicine, but
most physicians in an outpatient practice they focus on smaller range of
conditions than a whole hospital would. The ability for them to use the
granularity of 10-CM, and we are really only talking 10-CM obviously because
10-PCS is only a hospital use, I don’t think we should minimize that. Just in
the area of diabetes, which is one of the most frequent outpatient conditions,
hopefully a diabetic you are never going to see them in a hospital except with
other conditions but you are going to be treating on the outpatient. And the
ability to be able to tailor, practice disease management and all of that is so
I don’t think we should dismiss the value and it doesn’t mean they have to
know 400 codes. It does mean that you are right. You are absolutely right. We
need something to help them translate that greater granularity, which I think
they are going to have to document an electronic health record into the coding.
DR. WARREN: On top of that don’t forget long term care and all the other
allied health providers that also doing billing. It’s not just physicians but
there are nurse practitioners, dentists, physical therapy, et cetera. I need to
move it along. Is this critical, Donna? Harry.
MR. REYNOLDS: Any question I have our two new panelists can go ahead and
answer. I am going to make one comment. The 19,000 codes that don’t map I had
the opportunity the other day to sit with Sue Bowman for a whole day from
AHIMA, and she says 600. Now again, you have the mapping issues. Nothing is one
to one in some cases, but I think we have to be very careful with numbers
because as we are writing this letter and we are moving forward with this, this
idea of recommend one crosswalk and then saying 19,000 don’t match. I promise
you the laymen are going to go freaking.
PARTICIPANT: That is why we pulled the numbers out.
MR. REYNOLDS: I’m not challenging your number. I am saying this is an
imprecise science at the time you have to be talking to official people.
DR. FITZMAURICE: It probably depends upon which direction you are mapping.
It is easy to go from 10 back to 9.
MR. REYNOLDS: The point is this is an imprecise science. The first thing I
would like to do Judy is thank you, Jeff, and Lorraine for an outstanding
hearing. People are going to be leaving. Can I finish and then you can decide
whether I left anything out or not?
Next, I would like to thank Marjorie, Jeannine, Marietta, Katherine, and
Cynthia for letting us meet here and going through the issues of security so we
could meet here. I doubt there will be any amendment to my current comment from
MS. GREENBERG: Not just security but I think you probably noticed just like
at our meaningful use hearing. We had a lot of testimony. It was all available.
It was copied for us and it was all there when people needed it on the — just
collect and that really we thank Mary Ellen for that.
MR. REYNOLDS: We always appreciate that and they do a wonderful job with
that each time. Thank you for letting us be here. I think it has kept a lot of
the audience in the room whole time too.
So, my questions. Alec, the chart that you have on page 8 that talks about
the readiness of business partners and it talks about their accept or send
transactions. That is 5010, right? That’s not really ICD-10 because the reason
is if you are talking ICD-10 that one through seven may actually flip.
MR. DICKS: That is correct.
MR. REYNOLDS: Thank you. I just want to make sure that as we are looking at
it we’re not taking that as the whole body of work. David. You mentioned on
number 10 you mentioned that you believe it is going to be difficult to achieve
uniform adoption by October 2013. We have heard throughout these two days that
everybody and I want to understand whether you are making that as a statement
versus recommending that we have heard from everybody else pretty much
consistently that nobody should talk about moving these dates that these dates
should be what we are driving through. We should be focusing on that. I am
trying to understand.
MR. BIEL: We are not recommending that you move the dates, but we are
recommending that you help lead and take some steps or that CMS takes some
steps to drive collaboration and we heard communication plans but more I think
we need to break down the payer, provider, vendor, state, et cetera and bring
people together on a few of these key issues.
MR. REYNOLDS: We have heard that throughout the day. I am just making sure
again as we try to take all of our testimony and then do a letter, I want to
make sure where we have our common themes and what is going on with that.
MR. BIEL: Let me just say one other thing. I think also assuming that a
reform happens and something is past I think there will need to be some clarity
around how the overlap of those mandates fit with these and there is going need
to be a lot of communication on that.
MR. REYNOLDS: That came up in other testimony too. Mark. As you look at your
slide 5 in the last statement here. Variety of ICD-10 remediation approaches
being considered within the industry ranging from the following. In order what
would you consider the best way to go versus the somewhat hazardous way to go?
MR. WILLIAMS: The best and hazardous I guess I would —
MR. REYNOLDS: I am talking about as far as achieving. Everybody is talking
about benefits. Everybody is talking about getting where we need to be.
Everybody is talking about granularity. Everybody is talking about all the
things that otherwise it just becomes a cost. I will amend it to be that.
MR. WILLIAMS: Absolutely. It would seem that based on the analysis to date
and granted this is on a limited number of organizations and their best
thinking at this point relative to how they are structured. There is basically
when you look at it from a — this is skewed a little bit to the technology
side because the business side changes have to be made. You have to incorporate
the codes in your medical policies. You have to incorporate them into how you
do your processes. They are taking three tracts on how they accommodate
technology. There is a do nothing strategy, which means they either have
currently planned to retire an application system or whatever it is prior to
the compliance date. Now if it is not already scheduled to be retired or
sunset, they are going to move it up and that is one of those business values
they are going to try to achieve. Let’s not remediate that. Let’s not crosswalk
it. Let’s not do anything. We think we can move it up that saves us money on
the business side. It cuts our maintenance cost in the short order and it
avoids cost on ICD-10 remediation. That is the first one.
The second one as David said we have too many of them. We can’t do all them
all prior to October 1st, 2013 or maybe well in advance to that
because you got to do testing, a short-term crosswalk approach, and one that
will at least get us through the process. We don’t plan to do that long term.
That may be 12 months, 15, 18, maybe 2 years. Post-compliance they will
eventually eliminate that.
And then the third is where they do remediation on their core applications,
long-term strategy, applications and systems that they know they are going to
have for the distance. And on those they say out of the gate those will be
ready and those will be there for the long term and on those we will truly be
getting ICD-10 codes. We will be processing on ICD-10. We will be storing data
on an ICD-10 basis and getting the granularity and the benefit of that code out
of the gate.
MR. REYNOLDS: If a lot of the drive is not towards a native transfer then we
are going to be implementing ICD-10 for a lot of years.
MR. WILLIAMS: That is correct.
MR. REYNOLDS: Chris, I have heard you three or four times. Please keep
going. You are doing well. Keep going. Thank you everybody. Judy.
DR. WARREN: Okay, we have Jeff.
MR. BLAIR: I really appreciated all of the presentations. I noticed that
they were complimentary and synergistic. There was not any major divergence
among the four basic presentations. The presentation from Ketchum was how do we
communicate this. I reacted in a manner that is somewhat similar to Marjorie
and that is that — and I think everything that you have done and presented to
us is good and yes we absolutely need to improve awareness in the industry so
that they begin to immediately start planning and putting in place financial
support to make this transition and I believe in the transition. The piece that
concerns me is that there are so many things that are happening and in the
meetings that I have gone to where I have met with physicians not only did they
not know about 5010 and ICD-10. A lot of them didn’t even know about the
meaningful use. My concern here is that if this is a message — I’m a blind guy
so I’m putting blinders on the blind guy here. I think we have blinders on. We
are going through an overall transformation of our health care delivery system.
5010 and ICD-10 is an important critical part of it but if we have a separate
advertising campaign for that, what are we going to do? Have a separate
advertising campaign for meaningful use? We need to bring this message
especially for a lot of physicians and small hospitals. We need to pull it
together for them. They are going to have to pull it together at their end and
if they are getting separate messages from different departments within the
Federal government, it is going to be not our benefit. That is my only message.
I think that we need to point out the synergies. We need to point out the
overall picture of this transformation. I think you are well on the way of
doing a lot of that, but I think that I really strongly agree with the
observations Marjorie made because that is an excellent point of the way to
begin to pull this together so we are not winding up saying that the Federal
government is coming down with different programs that are not integrated,
connected, and coordinated. That is my speech. I would love to have comments.
MR. BIEL: We agree. In some of the discussion I think people have trouble
connecting the dots. They have to be connected.
MR. ROMA: Just to be clear there are providers today that exhibit meaningful
use of EMRs many that aren’t even thinking about — they go into it not even
thinking about ICD-10. These two things are not in their minds together in any
conversation that I have seen because I want to confirm that and I guess
reiterate because they are not merged together. That is why I addressed the
question I did around Canada because in Canada they were merged together and it
was the same transition to a meaningful use and two different set of codes. It
was a different process because that is kind of where I thought you were going
with that and your points are right on that they need to be merged to be
MR. WILLIAMS: And I think the point is too is it’s not just more
communication. It’s not just more integrated communication. I think it is why.
Why are we doing this? Why does it matter to them in the end? What is the
payoff quite frankly? They are going to make investments. Everybody is going to
go through significant amount of pain here and a big investment. What do we all
achieve in the end? Is it just a matter of this industry catching up where it
never did? We haven’t caught up with financial services and some of the banking
industry and some of the transaction sophistication they have created over
time. Is that what this is? Is there a payoff in the end when there is more
accurate information and the impact we are able to have on health care in the
condition of some of the specific critical disease and that? I think there all
has to be an end point somewhere as opposed to more things being pushed at them
especially when you get to the position level because they are the least
sophisticated in the sense of the business.
DR. WARREN: I am going to push this on. I have Walter and Jim and Jim will
be the last question.
DR. SUAREZ: I have two questions I guess. The first one is about education.
Up to panel 7 I was building up my sense of we are doing great. Everybody is
doing so much in education. We were all probably reacting in many ways the same
way until panel 8. When I read what is being said, it gives the impression that
nobody has heard about this. Nobody has heard about the importance of this.
There is a mismatch between something there.
Now, certainly there is a lot more education to be done and everybody agrees
on that. I think I want to distinguish this time around between what I would
call communication and outreach efforts with education and training initiatives
because this time around we have ICD-10, which as we have heard yesterday
requires a lot of education and training not communication and outreach. That
of course needs to be informed. It is almost like we need an alert message to
be broadcasted that we need to train people about ICD-10.
One of the messages that I got out of this last panel was and it is a good
sense is you know 5010 we are going to get there. It looks like we will
struggle with some things. But the big issue is ICD-10, maybe not a big
surprise even though in the previous panels 5010 had always been a big issue.
But what I heard in this panel was ICD-10 is the big problem, the big
transition. 5010 we need to get there and we will get there somehow. Forget
about 4010 and those that are not complying with it — we know there are some
that are not complying.
My question is then from the education perspective what else needs to be
done in order to get the message out. The point I wanted to make to Chris
because I work heavily on the MPI location. I lived and breathed day and night
MPI for three years. One of the more effective ways that we reach out in my
belief was that we created a countdown campaign where we tell people there is
18 months, there is 12 months, and there is 6 days. But what we kept maybe
disconnected was we have 12 months and these are the 12 steps you need to do
and this month you need to do this step and next month this step and if you
didn’t do these two steps, you are now two steps behind for month three. With a
campaign like that it would be helpful to be started. Starting January 1 we
have 24 months to comply. Is that a kind of alert message national campaign
type of strategy that needs to be done? I now got a complete disconnect between
all the things that we heard about the location and where things are.
MR. DICKS: I will comment and then I know Chris probably has some thoughts
on this as well. First, I would like to compliment Mr. Blair on his comments. I
think those well summed up some of what we have seen in the studies that we
have done. In terms of your question around education what we have heard and
seen is that there are really two types of education levels if you will that
the industry is seeking. One is just the basic awareness and traditional
education that you have talked about. The other is a more hands on tool-based
driven through example and that is where I think that unified message having
something like you described in terms of timeline, being able to articulate
here is the progress that is being made within CMS and here is where you need
to be at this point in the process are all elements that the people that we are
talking to would welcome and are looking for. They are looking for proactive
push type content versus them having to go search and hunt down the thousands
of emails and websites and data source that are out there. That would be the
comments that we would see from a Gartner perspective. I know Chris is at the
heart of this as well.
MR. HANDLER: Alec is exactly right. This is communication on two levels. It
is about awareness and it is about the technical details of how you make the
transition. What we are concerned about with right now is that we see this gap
in awareness. It was very interesting to see in the focus groups that for a
90-minute focus group there was a lot of discussion and anger about this
transition coming. This is news to me for 75 percent of the group. And then
there was a break where there was recognition and acceptance at some level and
then suddenly it was well what do we do. I think that is sort of a microcosm of
what we are going to see in this campaign overall. There is going to be this
initial anger, then surprise, and we have to break through that. It is really
the — the analogy I like to use would be trying to sell somebody on the
specifics of a car and how wonderful a car is when they are not even thinking
about buying a car. This initial part of the campaign is letting them know you
got to start thinking about buying a car and then sell them on the benefits of
When it comes to what you said about a countdown campaign, we are actually
looking exactly at that type of campaign and have looked at some tools that
specifically we tested that when someone would access for example the CMS
website, there would be a tool that would say this is where you should be. Are
you here? Are you a provider? Are you a payer? Are you a vendor? Then it would
actually tell them according to what our guidelines are that you should be at
this point. You should be assessing your risk or you should test your systems
or you should be sending test data. And if you are not this is what you should
have done. Where are you in this timeline? Whether or not it was format that a
particular participant would want or whether they would want sort of paper
hands-on tool kit, they wanted to know tell us what the process is and where we
should be in the process. I think that is going to be critical. We can
implement that on multiple layers. I know CDC very effectively uses things like
text messaging of alerts when it comes to things like influenza alerts. I can
see that having that sort of opt in campaign and that is part of this where you
would get a text message that said this is where you should be today. We are
coming up on submission of test data. Are you there yet? I completely agree
DR. SUAREZ: I have a quick follow up. A lot have been said about maps and
mapping and I don’t want to continue with that but I do need to say something.
Number one, maps are going to exist. Number two, maps from 9 to 10 and 10 to 9
are going to exist. Number three, there is in my mind according to the messages
that I am hearing a benefit of having some harmonization in the way this map
gets done and some rules on guiding principles — when mentioning guiding
principles on when and how they should be used. In your mind which group I
think you mentioned a few grassroots level kind of work being done. In your
mind who should be facilitating that work to develop those conceptually
harmonized mapping and guiding principles on using those maps?
MR. BIEL: I’m not sure it matters who facilitates it. I think what matters
which stakeholders are the table and are totally bought in to making it happen.
MR. WILLIAMS: I would add I think CMS has to drive it. They have to oversee
it, be the shepherd and put some boundaries around where all the stakeholders
that do come to the table go.
MR. DICKS: I would say that the expectation is that CMS would drive it. I
think ultimately, the fact that it gets done and it is endorsed and it is
harmonized are objectives that will lead to that being a success.
MR. BIEL: Let me just add to that. I think CMS absolutely has to be totally
in the game, but I think there has to be a representative portion of all the
other constituents. I think it has to be a collaborative effort. It can’t be a
top-down; here is what you are going to take. It needs to be — people need to
buy in. Everybody needs to buy in some way, shape or form, and maybe give and
take but at least be at the table otherwise it won’t be a trusted solution and
you are back at square one.
DR. WARREN: I am going to move on and let Jim ask a question. I would like
to end this at about 20 after so we only have two or three minutes for the
DR. SORACE: Part of this is just a comment and it is going back to the
earlier conversation about what 40 codes people have stuck in their minds.
There are a couple of articles I have sitting on my hard drive that look at
insurer observer variability and coding and SNOMED. I will just pull them out
and send them to the group because I think that they are somewhat relevant
I would be very interested in learning more about the Canadian experience –
issues like if they have looked at in terms of variability with ICD-10 and what
their experience was with decision support and coding tools and whether that
influenced the process. Just so that we get to the end of the site if there is
anything to learn there I think it would be very helpful.
I would also like to know basically how much more complicated their coding
looks now. If they have actually have moved from like 13,000 codes most
frequently used to 70,000. One of my personal interests actually is in fields
of computational complexity and I actually think that is something we need to
start keeping in mind here.
MR. BIEL: Just on that the US has got the largest ICD-10 code set by far. I
think in some cases by as many as five times the number of codes.
DR. SORACE: What is the number in Canada?
MR. BIEL: I don’t know off the top of my head.
MS. GREENBERG: I think one big difference is we have laterality and they
don’t. Of course you can just multiply that. Can I just say something about
this mapping and what Walter was saying? As you know very well there are
guidelines for mapping. Now generally what they have been addressed to is like
mapping SNOMED to ICD-10, going from like a terminology to a classification.
But there are some basic principles and NOM has articulated them and they have
been published and we should maybe look at those because they do include some
of the things that — you kind of have to tweak it a bit when you are thinking
of 9 to 10. They weren’t intended for that. But they say all right. You have to
include the proprietors or the developers of both code sets. Right there you
have to have obviously the government involved. The government developed both
have to include stakeholders and all that and know what you are using it for. I
think that —
DR. WARREN: That may be something that is really good for an appendix is for
us to pull those criteria out.
MS. GREENBERG: Right. And to see whether they help at all because I can’t
see the need to develop completely. Mary, maybe you disagree with me but
completely different guidelines for this type of mapping than you do for other
types of code mapping.
DR. WARREN: There is becoming an international body of work on mapping as
people are getting experience from mapping, SNOMED CT from English to French to
German to Spanish, et cetera. It is really reconfirming some of the mapping
rules and it is the same rules as going from ICD-9 to 10. If you think of those
as different languages and trying to find comparability, we probably do need to
pull those out.
MR. ROMA: I want to make sure I understand that, maybe clarify. The map that
I think many of us have talked about is a very literal map not a figurative set
of guiding principles. The guiding principles would lead you possibly to doing
a set of work, but I think the published standard that we talk about is a
literal full published standard.
DR. WARREN: I need to stop this. We have come up with a lot of different
things and we sort of blended in our committee’s discussion with this last
piece. But what I would like to ask the committee to do is probably within the
next week think about those things that you think really need to be a
recommendation from this letter. The other thing that I would like everyone to
think about is it is becoming apparent. We still have some holes in testimony
and who else do you want to hear from that we haven’t heard before. Tony wanted
to hear more about Medicaid and what was going on there. Please think about
that and get those points to either Lorraine or I. We have vendors. We have the
Medicaid people and I don’t know who else. I need to sit down and look at all
the testimony we have, but I think that is what we need to do.
MS. GREENBERG: Before people have to leave on the committee, others can
weigh in, but Justine and I were talking about this a little bit. We need to
have some at least gut sense. Yes, there may be additional people we need to
hear from but we have these different windows of opportunity. We have February.
There is a national committee meeting and then we have June, which is going to
be pretty dominated by the 60th anniversary and all that. Is there
enough to put in a letter? Is there enough urgency and is there enough
information to put in a letter in February? I think there is.
MR. REYNOLDS: We have to have a letter — February. We have to alert the
media on this one.
MS. GREENBERG: That is what I just wanted to make clear but even if we are
going to have other testimony.
DR. WARREN: If there is other testimony then let me know. Is that something
that we need to survey real quick or is it something that needs to be an
in-person hearing on that would be after February and may lead to another
letter, but we are determined. There will be a letter for February.
MS. GREENBERG: Good. I just wanted that on the table.
DR. WARREN: With that everybody is leaving so we will adjourn real quickly
before the room gets empty. Thank you.
(Whereupon, the meeting adjourned at 5:25 pm)