1. Understanding the ICD-10 Transition
Health Care Industry Committee
Understanding the ICD-10 Transition
Ready-to-Use Presentation Slides

2. Transitioning from ICD-9 to ICD-10: The Basics
Increased Number of Codes, New Complexities
Key Differences Between ICD-9 and ICD-10
ICD-10: Brief Overview
ICD-9
ICD-10
Number of Codes
Diagnosis : ~13,000
Procedure: ~ 4,000
Diagnosis: ~68,000
Procedure: ~87,000
Number of Characters
Up to 5 numeric
characters (some
exceptions)
Up to 7 alpha or
numeric characters
Inclusion of Co-Morbidities
Limited inclusion of co-morbidities, complications, severity, and risk
Includes co-morbidities within codes
Laterality
Does not distinguish
based on body part
laterality (left v. right)
Includes laterality when appropriate
Time of
Event
Combines initial and
ensuing encounters
Separates codes for initial and subsequent visits
Tenth revision of the International Statistical Classification of Disease and Related Health Problems (ICD)
An update to the medical codes used to record the diagnosis and treatment of a patient. New codes include:
ICD-10-CM (Clinical Modification): used for classifying diagnoses in both inpatient and outpatient settings
ICD-10-PCS (Procedure Coding System): used for classifying inpatient procedures
Source: Advisory Board interviews and analysis.

3. Charting the Transition Path
ICD-10 Implementation Timeline
January 16, 2009
Final rule sets ICD-10 implementation compliance date October 1, 2013
April 9, 2012
HHS proposed rule delays compliance date by one year to October 1, 2014
Today !
October 1, 2014
ICD-10 compliance date
February 16, 2012
HHS1 Secretary announces intent to postpone compliance date
August 24, 2012
Final rule delays compliance date to October 1, 2014
Claims submitted on or after this date must use ICD-10 codes; ICD-9 codes will not be processed
Health and Human Services.
Source: Advisory Board interviews and analysis.

4. Most Providers Still Unprepared for ICD-10
Fewer Than 10% of Medical Groups Prepared for the Transition
Medical Group Implementation Progress
According to MGMA1’s January 2014 Survey, N=570
Most Medical Groups are Behind Schedule
Have not begun implementation
Halfway there
“The critical coordination that must take place between practices and their software vendor, clearinghouse, and health plan partners is simply not happening at the pace required for a seamless implementation."
Prepared for transition
MGMA President Susan Turney, MD
Somewhat ready
Medical Group Management Association.
Source: Medical Group Management Association, “ICD-10 Implementation Study, January 2014” available at accessed Feb 10, 2014, Advisory Board interviews and analysis.

5. ICD-10 Costs Higher than Originally Projected
Medical Group Total ICD-10 Implementation Cost Estimates
According to the AMA1, 2008 and 2014
Sample Medical Group Size²
Small
3 MDs
Medium
10 MDs
Large
100 MDs
$12,885
$11,500
Average medical group cost per physician FTE to upgrade or replace EHR system
Average medical group cost per physician FTE to upgrade or replace practice management system
Source: American Medical Association “The Cost of Implementing ICD‐10 for Physician Practices– Updating the 2008 Nachimson Advisors Study” available at accessed on Feb 13, 2014 Group Management Association, “ICD-10 Implementation Study, January 2014” available at accessed Feb 10, 2014, Advisory Board interviews and analysis.
American Medical Association.
Three hypothetical group sizes used to determine cost estimates in the 2008 and 2014 AMA studies.

6. Financial Consequences for Providers
Underpayment due to inaccurate physician documentation, coding errors
Increase in account receivable days
Increase in denials
Reduction in physician/staff productivity
Increase in payer scrutiny of claims, audit risk
Potential Direct Revenue Losses
Overtime pay for IT staff
Unanticipated system upgrade expenses
Additional training for coders
Last minute coder recruitment
Expert support for unexpected problems
Potential Last Minute Operational Costs
Medical Groups Must Prepare Today for the Transition
“For any office that waits until the last minute to prepare for the transition, or simply relies too much on outside sources (i.e., EHR vendor, billing company, etc.), the staff will be constantly striving to catch up.”
Rhonda Buckholtz, VP of ICD-10 Education and Training, AAPC
Source: Physicians Practice, “Avoid Medical Practice Productivity Loss Due to ICD-10” available at accessed on Feb 11, 2014, Advisory Board interviews and analysis.