While much attention has been given to the delayed implementation of the ICD-10 clinical coding set until Oct. 1, 2015, hospital boards and leaders should be thinking about how to use this additional preparation time. One option is to take a closer look at current revenue-cycle strategies, clinical documentation and business processes to be sure the organization is being properly reimbursed for the care it provides and position it to weather the information technology, financial and staffing challenges ahead.

Even with this extra preparation time, some trustees may not understand the scope of the code set’s impact. The upgrade is not simply a coding staff project or information technology issue. In fact, coding extends across nearly all departments, including scheduling, billing, documenting patient care orders, discharge and more. As a result, the board should be prepared to ask questions and hold senior leaders accountable for progress.

What Trustees Should Know

Trustees should consider asking the chief executive and other C-suite members the following questions:

1 How are we addressing clinical documentation improvement? To ensure that medical decision-making is properly recorded and to take advantage of ICD-10’s granularity to report on and ultimately improve clinical quality, physicians and other groups who require documentation improvement need useful feedback and training.

Analyzing clinical documentation can help to identify the physicians who are struggling with documentation specificity. Approaching documentation accuracy as a quality measure will help to engage physicians in this process.

2 Where do we stand with our revenue-cycle strategy? In addition to asking about clinical documentation improvement, trustees should explore the potential impact on reimbursement due to diagnosis-related group shifts. Although this shift is expected to be budget neutral with with proper financial assessment and clinical documentation improvement in place, the board should be knowledgeable about the organization’s exposure here. Additionally, the board should confirm that the hospital has the reporting capability to immediately detect a negative financial impact.

The board also should use this time to inquire about the organization’s accounts receivable and whether AR aging poses a financial risk in the near future. Facilities that approach ICD-10 from a position of financial strength, such as two quarters of revenue in reserve, will be better prepared to weather the initial financial challenges of ICD-10 implementation, reimbursements and post-compliance activities.

A comprehensive, financial impact analysis may shine new light on your financials. Hospitals can conduct this analysis internally or externally. In an internal analysis, leaders should review reporting metrics by service line, physician and DRG. This type of review should clearly demonstrate the highest-impact areas for the initial focus. If externally, work with a vendor that has the ability to review analytics and provide detailed reporting along with recommendations for next steps.

Additionally, consider implementing technology that automates physician documentation. This enables greater specificity in documentation and provides transparency into the process as a whole.

3 Do we have sufficient and well-trained staff to handle coding implementation? Declines in productivity are inevitable as your hospital or system makes the transition to ICD-10. Putting together a contingency plan now will help to minimize the financial impact of the reduction in productivity.

The board should confirm that a comprehensive, ongoing educational program that involves all key stakeholders is underway and includes clinical and documentation staff. The inclusion of medical staff will be critical to success. Ultimately, ensuring that both groups are well-versed and trained in proper documentation amounts to a choice between hard work now or harder work later.

In rural areas, there may be limited qualified, certified health information management professionals. Trustees of these hospitals should advise hospital executives to explore hiring off-site certified coding staff to work remotely, even temporarily. Tapping into non-local sources of coding expertise to assist during and after the transition can help to maintain cash flow.

No Time to Relax

The one-year delay in ICD-10 implementation presents a choice: Hospital leaders can put preparation on the back burner or they can use the time to strengthen their organization’s position. Although boards don’t have a hands-on role in the coding transition, they play an essential role in ensuring the financial stability of the organization. One of the best ways to protect the hospital is to conduct financial, clinical documentation and technology impact assessments. Taken together, these analyses provide a holistic view of the business. Only then can the board and the C-suite make well-informed capital and operating expenditures. 

Mary Beth Seaman (MBSeaman@atrilogy.com) is vice president, health care, Atrilogy Solutions Group, Irvine, Calif.

Future-Proofing Your Organization

As dependent as hospitals and systems are on federal and state decisions, it is challenging for leaders to plan for future needs. It’s like trying to predict the weather a year from now.

That said, most executives would be wise to keep in mind what they can control. For information technology-related changes and transformations, it means gaining input from the most qualified staff possible — internally or externally — and making operational decisions accordingly.

Facilities that view the changes and varying initiatives solely as technical or coding projects are likely to be disappointed in their performance. Organizations that take a broad-based approach to mastering this transition will fare far better, no matter how the legal and regulatory environments change. M.B.S.