Benefits and Uses of ICD-10

Generating Cost Improvements

As an integral part of HIPAA administrative simplification, the ICD-10 code sets, along with the 5010 electronic transactions upgrade, will drive reductions in cost by enabling increased automation of the claims adjudication process and more precise determination in the payment process. Specifically enhanced capabilities that will lead to lower costs include:

• Monitoring patterns and levels of utilization for designing payment systems, including more innovative pay-for-performance models
• Setting health policy through the use of precise input (treatments) and output (outcomes) data
• Designing healthcare delivery systems
• Providing individuals with cost and outcome data related to treatment options to facilitate better decision making (important as self-directed individual plans and patient financial responsibility increase)

Quality of Care

Major improvements will result from the reporting and analysis of ICD-10 data focused on measuring the quality, safety, and efficacy of care. Under ICD-9, this could never be accomplished given its limitations. Enhanced reporting capabilities that will drive quality improvements include:

• Evaluating the efficacy of new treatments, including drugs, procedures, and technology for approval of reimbursement
• Monitoring and adjusting managed care processes, including treatment approaches for rapidly growing chronically ill populations with multiple comorbidities
• Driving more effective research, including clinical trial and epidemiological research
  
• Tracking for bioterrorism and public health

Fraud and Abuse Monitoring

 

A major part of the cost justification for ICD-10 is the precision available for monitoring and preventing fraud and abuse. Accurate and complete documentation of care and correct coding will be even more important than in the past.

For provider organizations that have faced difficulties with charting and coding, a change of culture will need to occur. For best practices information about Change Leadership/Business Process Reengineering, please visit our Resources page.