ICD-10 Implementation Approaches: Penny Wise and Pound Foolish

Some health care organizations are now looking for “…A good ICD-10 project manager…” to lead the ICD-10 effort.   This appears for some to be budget driven.  Rather than retain an outside consulting firm, some health care companies want a project manager who can deal with the regulatory, payor and provider contracting, physician outreach experience, medical policy, IT, EDI, medical coding, process impacts, revenue cycle, predictive analytics, workflow, data warehouse, business intelligence, and other areas of this complex mandate while costing less than an outside consulting firm

There are three issues with this approach.  First, we know of no project manager in health care who brings all of these competencies together as one resource.  ICD-10 hasn’t been implemented yet by anyone, and usually a project manager’s role is in part driving to a delivery schedule, not having the regulatory compliance skills for example to know if that schedule is cutting corners and putting the health plan or hospital system at risk.

Second, all of the expertise to successfully transition to ICD-10 does not usually reside within any single payor or provider.  ICD-10 tends to bring new responsibilities to already busy stakeholders, operational, medical and IT resources who are needed to keep the business running.  ICD-10 organization strategy would suggest first determining where you have weaknesses and hiring to those weaknesses, or seeking these resources from outside consulting firms if needed.

Third, organizations that want a project manager and sometimes an inexpensive one at that, risk a much bigger reimbursement or regulatory impact if they get ICD-10 wrong.  For example, health plans who fail to comply risk fines of up to $1.00 per covered life per month.  Hospitals risk a shift of reimbursements that may not be in their favor.  For example, one $800 million hospital we work with determined that it could easily see a minimum of a one percent (1%) reimbursement risk or $8.0 million if ICD-10 is implemented without proper planning.  That cost is so high that the risk that the hospital system would be exposed to called for a different approach.  The hospital has determined that micro managing their recruiting and worrying about saving $15.00 per hour on the right project manager without putting together a team with internal and external competencies would be  a costly mistake.

One of our clients told us that they didn’t need a review of HIPAA 5010 and ICD-10 impacts on their dental insurance business because dental wasn’t covered under HIPAA.  We politely asked if they had heard of the 837D EDI transaction, specifically for dental.  Given that it is an EDI eligibility transaction, their dental business is absolutely regulated under HIPAA.   The corporate attorney for the client as well as the HIPAA expert legal counsel for the client somehow missed this point, clearly stated in Title II of the HIPAA regulations.  While dental was a small part of the overall business, the health plan would have been putting their primary multi-billion business at risk of serious fines had they gone ahead with their plans based on their internal assumptions.

Our approach has been to provide “PMP+P” – project managers with PMP certifications PLUS a team of experts who are fractional resources that can be called upon by the project manager and the client for the expertise needed in the competencies to deal with ICD-10 implementation.   One good project manager can help.  A PM backed by experts is better and more cost effective than worrying about the pennies or on the other hand completely outsourcing something that in the end health plans and providers themselves will be accountable for.  We think this is the best ICD-10 implementation approach.

Michael F. Arrigo

Michael is Managing Partner & CEO of No World Borders, a leading healthcare management and IT consulting firm. He serves as an expert witness in Federal and State Court and was recently ruled as an expert by a 9th Circuit Federal Judge. He serves as a patent expert witness on intellectual property disputes, both as a Technical Expert and a Damages expert. His vision for the firm is to continue acquisition of skills and technology that support the intersection of clinical data and administrative health data where the eligibility for medically necessary care is determined. He leads a team that provides litigation consulting as well as advisory regarding medical coding, medical billing, medical bill review and HIPAA Privacy and Security best practices for healthcare clients, Meaningful Use of Electronic Health Records. He advises legal teams as an expert witness in HIPAA Privacy and Security, medical coding and billing and usual and customary cost of care, the Affordable Care Act and benefits enrollment, white collar crime, False Claims Act, Anti-Kickback, Stark Law, physician compensation, Insurance bad faith, payor-provider disputes, ERISA plan-third-party administrator disputes, third-party liability, and the Medicare Secondary Payer Act (MSPA) MMSEA Section 111 reporting. He uses these skills in disputes regarding the valuation of pharmaceuticals and drug costs and in the review and audit of pain management and opioid prescribers under state Standards and the Controlled Substances Act. He consults to venture capital and private equity firms on mHealth, Cloud Computing in Healthcare, and Software as a Service. He advises ERISA self-insured employers on cost of care and regulations. Arrigo was recently retained by the U.S. Department of Justice (DOJ) regarding a significant false claims act investigation. He has provided opinions on over $1 billion in health care claims and due diligence on over $8 billion in healthcare mergers and acquisitions. Education: UC Irvine - Economics and Computer Science, University of Southern California - Business, studies at Stanford Medical School - Biomedical Informatics, studies at Harvard Medical School - Bioethics. Trained in over 10 medical specialties in medical billing and coding. Trained by U.S. Patent and Trademark Office (USPTO) and PTAB Judges on patent statutes, rules and case law (as a non-attorney to better advise clients on Technical and Damages aspects of patent construction and claims). Mr. Arrigo has been interviewed quoted in the Wall Street Journal, New York Times, and National Public Radio, Fortune, KNX 1070 Radio, Kaiser Health News, NBC Television News, The Capitol Forum and other media outlets. See https://www.noworldborders.com/news/ and https://www.noworldborders.com/clients/ for more about the company.

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