Preparing Your Practice for 5010

November 10, 2010
Lucien W. Roberts

Medical practices face two significant deadlines that require planning and testing in 2011. The first is the new 5010 electronic claims transmission standard, the second ICD-10.

Medical practices face two significant deadlines that require planning and testing in 2011. The first deadline, January 1, 2012, is for the adoption of a new standard - the 5010 standard -for electronic claims transactions. This change must be made to accommodate regulatory changes in core billing processes such as claims submission and remission, claim status inquiry, eligibility inquiry, and transaction acknowledgment.

The second deadline is the long-awaited (or long-dreaded) deadline for moving from the ICD-9 to the ICD-10 code set. This deadline is slated for October 1, 2013. In addition to changes physicians and other providers will have to make in recording diagnoses and procedures, the move to ICD-10 will require extensive re-programming and testing of practice management systems, revision of encounter and testing forms, and numerous other changes.

It is critical that practices be ready for these two deadlines. Failure to prepare for either could bring a practice to its operational - and financial - knees. The following is a short synopsis of these two transitions and a roadmap to get your practice started with necessary preparations.

Moving from X12 4010A1 to 5010

If these numbers mean nothing to you, do not be alarmed, but don't stop reading either. Here's a short primer:

HIPAA law requires the Department of Health & Human Services to create standards that "covered entities" (i.e., medical practices, health plans, clearinghouses, etc.) must use when electronically conducting core administrative transactions. The current version of this standard is the Accredited Standards Committee's X12 Version 4010/4010A1. Beginning January 1, 2012, the required standard will be Version 5010, which will allow for additional functionality. The new standard holds the promise of more efficient claims transactions for your staff and, if your practice is ready, will have no impact on your clinical routine.

Moving from ICD-9 to ICD-10

From a clinical perspective, ICD-10 will require much more specificity on the part of providers. The number of diagnoses goes from about 13,000 to more than 68,000, while the number of procedures will go from 4,000 to 72,589 - not quite as long as my honey-do list, but close. The more you understand the ICD-10 nomenclature, particularly as it relates to your area(s) of clinical care, the better off you will be on October 1, 2013.

From a business perspective, ICD-10 matters, too - a great deal. Why? Because ICD-10 codes consist of between 3 to 7 alphanumeric characters; ICD-9 codes consist of 3 to 5 numeric characters. This expansion from a maximum of five characters to seven characters and the change from a numeric field to an alphanumeric field will require numerous behind-the-scenes changes to the business of medicine.

First steps

What your practice needs to do in the next few months is ask questions of your software vendor, your clearinghouse, your billing service, and key payers. You want to make sure each has begun its 5010 and ICD-10 preparations in earnest. You want to make sure they have implementation plans and schedules in place. You want to confirm their testing schedules. It is critical to test mock 5010 and ICD-10 electronic submissions before their respective deadlines. You do not want to leave these two sleeping dogs to chance.

Your software vendor is particularly critical, as practice management software vendors are not "covered entities" and thus not legally responsible for compliance. However, from a customer service and sales standpoint, they are obligated to bring their products into compliance. Make sure they do not delay their preparations - paraphrasing an old adage, "It will hurt you a lot more than it hurts them." Ask upfront if the requisite upgrades to accommodate these industry shifts are included in your maintenance agreements or are an additional cost.

To access a list of questions that your practice should ask vendors, clearinghouses, and payers, click here.

Seismic changes such as ICD-10 and 5010 truly have the potential to disrupt the cash flow that is the life blood of your practice. Addressed early though, potential catastrophes can be avoided. Preparing your physicians and staff through early implementation and testing can help lessen the disruptions to your revenue cycle and minimize the impact on your practice. Don't wait any longer!

Lucien W. Roberts, III, MHA, FACMPE, is associate administrator of business development at MCV Physicians. He also consults with medical groups and health systems in areas such as compliance, physician compensation, negotiation, strategic planning, and billing/collections. He may be reached at lucien.roberts@yahoo.com.