ICD-10 Clinical Scenarios and Medical Concepts Help Understanding of Reimbursement Risk

ICD-10 clinical scenarios can be used to understand potential risks and variations in health care claims reimbursement for procedures that are provided after October 1, 2014.

For example, an 82-year old female patient with a cardiovascular condition could have a procedure under ICD-9 CM with a correlating Diagnosis Related Grouping (DRG) of 251 and a reimbursement for the procedure of $9,622.80.  Under ICD-10 after October 1, 2013 this same procedure, if documented and coded one way would lead to the same DRG of 251 and therefore would be “revenue neutral” under ICD-10.  However if documented and coded differently this procedure could result in a DRG 230 the reimbursement might shift to $24,343, or a reimbursement risk of $14,721.  This is one hundred and fifty three percent (153%) of the original reimbursement.  However, CMS suggests cross-walking this procedure to a DRG 254, which could result in a third reimbursement outcome.

Understanding how ICD-10 changes medical concepts can help hospitals and other health care providers plan for shifts in reimbursement, and it can help health plans and large self-insured employers to design a path forward in redesigning medical policy and benefit plans.  Proper ICD-10 impact assessment and ICD-10 implementation planning can help health care companies improve their planning and preparation for the best transition possible.  ICD-10 clinical documentation improvements, coder quality and other aspects can be addressed via the right methodology and reference implementation model.

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Notes

  • Percutaneous Transluminal Coronary Angioplasty – MS-DRG 251 “Percutaneous cardiovascular procedure without coronary artery stent without MCC”
  • Coronary Bypass – MS-DRG 230 “Other cardiothoracic procedures without CC/MCC”
  • Source: CMS https://www.cms.gov/acuteinpatientpps/downloads/CMS-1533-FC.pdf – Vascular Repair – MS-LTC-DR 254 Other vascular procedures without CC/MCC

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. He leads a team that provides Cybersecurity best practices for healthcare clients, ICD-10 Consulting, 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, Insurance Fraud, payor-provider disputes, and consults to venture capital and private equity firms on mHealth, Cloud Computing in Healthcare, and Software as a Service. He advises 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 quoted in the Wall Street Journal, New York Times, and National Public Radio.

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