ICD-10 Implementation – CMS Says “All States at High Risk”

Today at the WEDI ICD-10 Forum in Fairfax Virginia, Robert L. Guenther, Technical Director for the U.S. Department of Health and Human Services at the Centers for  Medicare and Medicaid Services concluded that “All States are at high risk” in terms of their ability to complete CMS requirements at a state level to implement ICD-10.

The key issue will focus not on technical, IT oriented approaches but on leadership and a view of the real business issues around implementing ICD-10.

Iowa however is one of the few states that appears to be ahead of other states.  Iowa Medicaid Enteprise (IME) is successful due in part to the early realization by IME leadership that:

  • The largest impact will be to policy and business, not technical.
  • Deadlines are firm and will not be extended
  • Subject matter expertise will be important in making ICD-10 implementation a success.
  • Best practices include:

    • A collaborative environment
    • Complete operational procedure documents
    • Comprehensive systems documentation
    • IME completed a MITA State Self-Assessment (SS-A) completed in May 2009 which covers the 79 business processes that all states need to master and document which would have business, system and process impact.

    There is a business architecture that spans all operational functions.  In addition IME performed a gap analysis that helped guide them by using “high,” “medium,” and “low” as the impact rating system.

    They scored their strategies with benefits, drawbacks, costs, best use as well as the costs to implement.

    IME’s performance based model implies higher weights toward categories that influcence program integrity and quality:

    The high level estimated percentages for weighting were established which focused in context of ICD-9, ICD-10 and mapping both directions.  The benefits, drawbacks, and best use categories were considered.  The cost range for the State of Iowa was between $8 million and $10 million for a level of compliance that didn’t meet all requirements, an “intermediate” level of compliance would cost up to $11 million, and “optimal” compliance would cost $14.6 to $17.6 million.  This estimate is nearly twice the estimate of CMS for a state to implement ICD-10.

    Other IME considerations:

    Challenges with NPI translation approach

    • Project estimates are much larger than anticipated (2-3 times NPI [fusion_builder_container hundred_percent=”yes” overflow=”visible”][fusion_builder_row][fusion_builder_column type=”1_1″ background_position=”left top” background_color=”” border_size=”” border_color=”” border_style=”solid” spacing=”yes” background_image=”” background_repeat=”no-repeat” padding=”” margin_top=”0px” margin_bottom=”0px” class=”” id=”” animation_type=”” animation_speed=”0.3″ animation_direction=”left” hide_on_mobile=”no” center_content=”no” min_height=”none”][national provider id] project costs).  For most, NPI was a difficult and expensive task for health care companies.
    • Project impacts and recommendations need to be communicated effectively to the executive team
    • System replacement options and implications

    Our team would be happy to help develop your plans using our experience and best practices.  Contact us by email
    at [email protected].


    Michael F. Arrigo

    Michael Arrigo, an expert witness, and healthcare executive, brings four decades of experience in the software, financial services, and healthcare industries. In 2000, Mr. Arrigo founded No World Borders, a healthcare data, regulations, and economics firm with clients in the pharmaceutical, medical device, hospital, surgical center, physician group, diagnostic imaging, genetic testing, health I.T., and health insurance markets. His expertise spans the federal health programs Medicare and Medicaid and private insurance. He advises Medicare Advantage Organizations that provide health insurance under Part C of the Medicare Act. Mr. Arrigo serves as an expert witness regarding medical coding and billing, fraud damages, and electronic health record software for the U.S. Department of Justice. He has valued well over $1 billion in medical billings in personal injury liens, malpractice, and insurance fraud cases. The U.S. Court of Appeals considered Mr. Arrigo's opinion regarding loss amounts, vacating, and remanding sentencing in a fraud case. Mr. Arrigo provides expertise in the Medicare Secondary Payer Act, Medicare LCDs, anti-trust litigation, medical intellectual property and trade secrets, HIPAA privacy, health care electronic claim data Standards, physician compensation, Anti-Kickback Statute, Stark law, the Affordable Care Act, False Claims Act, and the ARRA HITECH Act. Arrigo advises investors on merger and acquisition (M&A) diligence in the healthcare industry on transactions cumulatively valued at over $1 billion. Mr. Arrigo spent over ten years in Silicon Valley software firms in roles from Product Manager to CEO. He was product manager for a leading-edge database technology joint venture that became commercialized as Microsoft SQL Server, Vice President of Marketing for a software company when it grew from under $2 million in revenue to a $50 million acquisition by a company now merged into Cincom Systems, hired by private equity investors to serve as Vice President of Marketing for a secure email software company until its acquisition and multi $million investor exit by a company now merged into Axway Software S.A. (Euronext: AXW.PA), and CEO of one of the first cloud-based billing software companies, licensing its technology to Citrix Systems (NASDAQ: CTXS). Later, before entering the healthcare industry, he joined Fortune 500 company Fidelity National Financial (NYSE: FNF) as a Vice President, overseeing eCommerce solutions for the mortgage banking industry. While serving as a Vice President at Fortune 500 company First American Financial (NYSE: FAF), he oversaw eCommerce and regulatory compliance technology initiatives for the top ten mortgage banks and led the Sarbanes Oxley Act Section 302 internal controls I.T. audit for the company, supporting Section 404 of the Sarbanes Oxley Act. Mr. Arrigo earned his Bachelor of Science in Business Administration from the University of Southern California. Before that, he studied computer science, statistics, and economics at the University of California, Irvine. His post-graduate studies include biomedical ethics at Harvard Medical School, biomedical informatics at Stanford Medical School, blockchain and crypto-economics at the Massachusetts Institute of Technology, and training as a Certified Professional Medical Auditor (CPMA). Mr. Arrigo is qualified to serve as a director due to his experience in healthcare data, regulations, and economics, his leadership roles in software and financial services public companies, and his healthcare M&A diligence and public company regulatory experience. Mr. Arrigo is quoted in The Wall Street Journal, Fortune Magazine, Kaiser Health News, Consumer Affairs, National Public Radio (NPR), NBC News Houston, USA Today / Milwaukee Journal Sentinel, Medical Economics, Capitol ForumThe Daily Beast, the Lund Report, Inside Higher Ed, New England Psychologist, and other press and media outlets. He authored a peer-reviewed article regarding clinical documentation quality to support accurate medical coding, billing, and good patient care, published by Healthcare Financial Management Association (HFMA) and published in Healthcare I.T. News. Mr. Arrigo serves as a member of the board of directors of a publicly traded company in the healthcare and data analytics industry, where his duties include: member, audit committee; chair, compensation committee; member, special committee.

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