CMS signals it will move to new billing codes

The Centers for Medicare and Medicaid Services has awarded a contract potentially worth $10 million to the American Health Information Management Association to study converting to a newer set of billing codes.

AHIMA, the nation’s foremost advocate for the new billing codes, is supposed to study the effect on CMS’ systems, policies and operations of switching from International Classification of Diseases (ICD)-9 code sets to ICD-10.

CMS Administrator Kerry Weems said the contract “should send a signal to hospitals and other stakeholders who use the ICD-9 coding to begin making their own transition plans.” He said the agency has no timetable for the conversion.

AHIMA spokesman Craig May said the association will employ three subcontractors: RAND Corp. to study cost factors associated with the conversion, Symphony Corp. to collect data and Vangent Inc. for business process analysis and other tasks.

The contract is worth $3.25 million in its first year. CMS could extend it up to four more years.

The ICD-9 codes, which date back to the 1970s, are shorthand for diagnoses and for inpatient hospital procedures. Though designed primarily for billing and payment, they are used today for quality reporting, public health reporting, research and other purposes.

There are 17,000 codes in the ICD-9 scheme, and almost all of them are in use. As new diseases such as avian flu and SARS emerge and new medical procedures are developed, the system has increasing difficulty in accommodating them.

The ICD-10 coding system, in use throughout Europe, has 210,000 codes and allows for more fine-grained descriptions of diseases and treatments.

A health information technology bill introduced by then-Rep. Nancy Johnson (R-Conn.) that failed to win passage last year called for switching to ICD-10 by 2010, but organizations such as the Blue Cross Blue Shield Association opposed it, saying more time was needed to implement the change.

The National Committee on Vital and Health Statistics recommended the upgrade in 2003, and a RAND study then said the government would quickly recoup its costs of converting to ICD-10.

About the Author

Nancy Ferris is senior editor of Government Health IT.

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