Be prepared for more confusing insurance claims, here’s why

Be prepared for more confusing insurance claims, here’s why

New coding system could lead to delays in authorization for procedures or denial of claims because of incorrect coding.

The launch of new government-mandated codes for hospital procedures and diseases is likely to cause even more confusion and erroneous billing as hospitals, doctor offices and insurance companies began using the system on October 1st, according to an article on

The new system, International Classification of Diseases, Tenth Revision, known as ICD-10, was to be implemented after two years of delays on Thursday.  Medical care providers will start to use the 140,000 new codes to describe disease diagnosis and care procedures that the providers must use to bill private insurances companies and the government for their services.

And at least one analysis of the new system says twenty-five percent of the doctor’s offices in the United States are not ready to make the transition to the new codes.

Warning of problems to come, insurance companies, along with employers and human resources departments, have been trying to educate their enrollees as to potential for incorrectly coded procedures that could lead to denial of coverage or many other types of billing confusion.

The Center for Medicare & Medicaid Services is requiring the new codes to replace the older ICD-9 codes that have limited information on medical conditions and procedures.  The hope is that the new codes will provide a more accurate description of the services performed, while still providing flexibility to accommodate future healthcare needs.

The Center also hopes the new codes will facilitate timely electronic processing of claims by reducing requests for additional information by using more specific coding.

American Medical Association president Dr. Steven Stack commented earlier this past week, “The impact of the ICD-10 switch over on the healthcare system will not be fully understood until after claims processing begins on Oct. 1.”

Physician groups believe there may be some challenging situations to come from the conversion and its implementation.  One recent survey found that more than 20 percent of doctor’s offices have not received the updates to their systems that contain all the codes for ICD-10 coding to begin.

Chris Miles, senior vice president of Aon Hewitt’s health group said, “This is a complex conversion that could initially lead to disruptions across the medical field.  Providers may see overall delays in claims processing, and some individuals may have insurance claims that are denied for services that were provided, but not properly coded.”

Private insurers are feeling the pain from the massive undertaking to convert the codes as well.  The insurance companies will be using the codes throughout their claim processing procedures and will use that information to send payments to doctors and other types of healthcare providers.  Converting all their systems to the new codes has required a good deal of capital investment, and is impacting the bottom line of the companies.

Experts in the field of benefits are concerned about delays in authorization of some types of procedures and claims being denied if healthcare providers are not using the proper codes for patient care.

Most expect the shift to the new codes to be a good thing overall, especially after the initial start up bugs are worked out.  Hospitals and doctors are moving away from fee-for-service medicine towards a healthcare system that values quality care and outcomes as a basis for reimbursement.

Senior vice president Miles adds, “Transferring to the new medical claim codes will allow key industry stakeholders to better track and manage diseases, measure the quality of care and evaluate patient outcomes—all of which support the shift toward value-based payment plans.”

Preparations for the change over to ICD-10 began back in 2010, but the implementation of the change was delayed back in 2012.  A study released by the Government Accountability Office (GAO) last month said the complete cost of the transition was not yet known, but a Nashville hospital said the change over would cost around $30 million based on 2015 costs.

There were some concerns earlier that the possibility of a government shutdown over the budget could have held up the spending bill, but the Center said they were ready to implement the new coding and political or technical challenges would not interfere.

Patience will be required as the new system goes into effect.  It is inevitable that some confusion and delays will occur, but most hope the transition will proceed swiftly.

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