Impact of ICD-10 on Coding Productivity

As I talk with CFOs and Directors of HIM, one subject that keeps coming up is the dramatic effect that ICD-10 will have on productivity.  Unfamiliarity with the new ICD-10 code set and the increased complexity that is inherent in ICD-10, will impact the productivity of any member of the staff who documents, determines, records, or uses an ICD-10 diagnosis or procedure code.  Nowhere will the impact be more obvious than in the HIM department, where coders main job function is determining these codes.

Making precise estimates of exactly how large the productivity impact will be on coders is difficult.   A simultaneous replacement of diagnosis and procedure codes on this scale has never been attempted. Fortunately, studies published during Canada’s transition to ICD-10 and more recent efforts in the United States provide a good basis for building a model of these productivity impacts.

Transition Example from Canada – Humber River Regional Hospital

Humber River Regional Hospital (HRRH) in Ontario implemented the Canadian version of ICD-10 CM (disease coding only — 40,000 codes vs. 70,000 in the US) in their three hospital system in 2002.   The results, which are detailed here indicate that coder productivity fell by approximately 50 percent immediately after transition to ICD-10 and improved to a 20 percent decrease at one year.  The authors of the study noted that “it was at least three to six months post-implementation before there was any appreciable improvement in the decreased productivity and almost a year before productivity levels approached pre-ICD-10 levels.”

Coder Productivity in Canada

 

The AHIMA ICD-10-Field Testing Project

AHIMA conducted a time study of ICD-10 coding soon after the US versions of the code sets were released.  This first study was extremely valuable for our purposes as it validates the findings of the Canadian model and confirms that the initial impact on coders will be approximately 50 percent.

The following table is based on data extracted from that study and represents the impacts on coding rates for various lines of service.

AHIMA Coder Productivity

The HIMSS/WEDI ICD-10 National Pilot Program

Most recently, HIMSS and WEDI released the first results from their national pilot program, an industry-wide effort to provide data and awareness around ICD-10 testing.

Although productivity measurement was not a key objective of the study, the authors note that, using ICD-10, coders averaged two medical records per hour, compared to four per hour under ICD-9.  This 50 percent decline in initial productivity is consistent with the other two studies, and will be used as the baseline short-term impact for our model.

Coding Productivity Model

Based on these studies we believe that hospitals should plan for a 50 percent reduction in productivity for their current coders in the first three months.  We further believe that the coding productivity will continue to improve, as shown in the Humber study, leveling out at 80 percent of ICD-9 levels at one year after ICD-10 implementation.

The figure below shows this graphically, and indicates two “regions” of productivity impact. The permanent impact region, consisting of the 20 percent impact that is not expected to recover, and the temporary impact region, consisting of the impact that coders are expected to recover after a year of experience coding in ICD-10.

Coding Productivity Graph

If not mitigated,  the effects of this coding productivity loss would be catastrophic. Claims would go un-submitted, reimbursements would drop by half, and financial ruin would be only a short distance away. No hospital has the excess coding resources to absorb this impact.

This post is the beginning of a series of posts that will discuss strategies for dealing with this critical productivity loss. Future posts will address training strategies, outsourcing, computer assisted coding, and other recommendations for mitigating risks and overcoming this critical barrier to ICD-10 success.

For additional risk mitigation strategies, download our ICD-10 Risk Report >>

 

About Thomas Grove

Principal

A Principal with Phoenix, Tom has over 20 years experience in healthcare IT management consulting and project leadership in such areas as systems implementation, revenue cycle management, HIPAA privacy and security, Meaningful Use, and process improvement.

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