Revenue Cycle Management Blog | GroupOne Health Source

ICD-10 Final Rule Released - Compliance Date Set

Written by Kaitlyn Houseman | August 1, 2014

The U.S. Department of Health and Human Services (HHS) issued a final rule Thursday afternoon for a compliance date of October 1, 2015 for conversion to ICD-10 diagnostic and procedure codes.

According to the Centers for Medicare and Medicaid (CMS), the deadline will allow “providers, insurance companies and others in the health care industry time to ramp up their operations to ensure their systems and business processes are ready to go on Oct. 1, 2015.”

The announcement was part of a final rule posted to the Federal Register by CMS that detailed why the ICD-10 code set should be implemented on October 1, 2015.

On May 1, 2014, the Centers for Medicare and Medicaid Services (CMS) issued an interim final rule that set the new compliance date for October 1, 2015. The final rule issued Thursday features few changes from the interim final rule, but does officially finalize the compliance date and offers more explanation from CMS for why the ICD-10 implementation should occur in 2015. The final rule also outlines the cost implications of the code set implementation’s previous delays.

The CMS announcement in May came exactly one month after Congress enacted the Protecting Access to Medicare Act of 2014 (PAMA) (Pub. L. No. 113-93), which unexpectedly delayed implementation of ICD-10 by an additional year. That law stated that the HHS “Secretary may not adopt ICD-10 prior to October 1, 2015.”

In a posting to the Federal Register, government officials explained why they chose a compliance date of October 1, 2015. They noted that they had considered delays of varying duration. Ultimately, however, CMS picked the same date AHIMA has advocated for—and which would minimize financial burdens to the industry.

“We concluded that a delay beyond one year would be significantly more costly and have a damaging impact on industry. For example, extending the delay beyond one year could render current ICD-10 system updates and releases obsolete, which would diminish the investments stakeholders have already made to prepare for the ICD-10 transition,” officials wrote.

“All segments of the health care industry have invested significant time and resources in financing, training, and implementing necessary changes to systems, workflow processes, and clinical documentation practices. Stakeholders would need to restart their system preparation and would not be able to leverage past system investments,” the statement said.

But will one year be enough for those who pleaded with HHS for an ICD-10 delay? 

“This conversion has proven so far to be extremely difficult for practices and their trading partners to accomplish,” said Robert Tennant, senior policy adviser for the Medical Group Management Association. “Despite the additional time, facing multiple federal quality reporting requirements and an uncertain payment environment, practices may continue to experience challenges with software upgrades, workflow modification and staff training.

“Absent Medicare and other public and private health plans aggressively pursuing end-to-end testing and being fully transparent in terms of payment policies well in advance of the compliance date, we remain concerned that cash flow following Oct. 1, 2015, could be disrupted,” Tennant said. “We will continue efforts to educate our members on this complex change and prepare them for this transition.”