MedData’s CEO Barnes: ICD-10 will be a big-data journey

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 - Ann Barnes, President and CEO, MedData, Inc.
Ann Barnes, President and CEO, MedData, Inc.

Radiographs of the ankle, hip and knee getting coded as mammograms; a popular code-assist product failing right out of the gate and remaining troublesome months later; small billing companies shuttering their offices, leaving physician practices without any billing services at all. These are some of the scenarios reported in the wake of the Oct. 1, 2015, launch of the 10th revision of the International Statistical Classification of Diseases and Related Health Problems (ICD-10).

Ann Barnes, president of MedData, one of the largest revenue cycle management (RCM) firms in the U.S., says such troubles were inevitable heading into the ICD-10 era, but they are fixable going forward. If high-performing coders are indispensible to the job, so is equipping them with up-to-the-task technology.

Well-trained coders, a sharp technology platform and a laser focus on clients and their patients all served MedData well through the transition, according to Barnes. She recently took questions on ICD-10 from imagingBiz. Key excerpts follow.

Q. What have you observed since the October 1 launch, both among your clients and the industry at large?

Barnes: MedData was a little unique in that we were excited about the transition to ICD-10, and, in fact, were disappointed each time it got postponed. The reason: we spent the last three years getting ready by building the technology crosswalks and guided coding platform, by analyzing each of our clients to see where documentation would be deficient as we moved into ICD-10, and by starting physician education early.

All this investment in technology, training, and time resulted in a very stable transition both for our organization and our clients. I think the industry has seen a 40% average dip in coding productivity, while we are running at just about a 1% decrease post-transition. Given the increase in coding complexity, this performance means that all of our work has paid off.

As we anticipated, physician documentation did in fact turn out to be the biggest challenge for the transition. ICD-10 requires a much higher level of specificity for reason for exam than clinicians and technologists are accustomed. Cumbersome implementations of electronic medical record systems were already causing a dip in documentation and adding to the overall turmoil in the coding marketplace. For many RCM companies, it was somewhat of a perfect storm.

On additional observation: Organizations without the mission—and the platform—to deliver a patient-centric approach to collections are experiencing even more frustration with the ICD-10 transition. First, they’re falling down on coding accuracy for reimbursements, and second, they aren’t able to optimize collections for the services for which they are billing. It’s a double whammy that is definitely impacting their short-term bottom line and their longer term patient relationships.

Q. Explain how MedData is leveraging a patient-centric services approach as part of its ICD-10 transition?

Barnes: When we started down the patient service path prior to our ICD-10 implementation, hospitals were not yet fully seeing patient satisfaction post-discharge as a key piece of the puzzle for long-term growth. They very much do now, especially post transition when RCM is under the microscope by their executive teams.

It doesn’t matter whether one of their patients went through radiology or anesthesiology or cardiology or primary care or emergency. All patients, once they get into the collection cycle, are going to behave the same way. They are going to behave by balance size. So, if you don’t have insight into how much a patient owes—in total—you aren’t armed with the information you need to maximize collections.

For example, if you have a $50 co-pay today, but also owe an additional $1,000 around the network, we know that you are going to behave like you owe $1,000; you’re not going to behave like you only owe $50. Our platform enables hospitals and groups that don't have the technology to see the patient across that kind of landscape. By combining all relevant data in a platform specifically designed for RCM, we help our clients see the true status—and value—of a patient so that they can use the most effective RCM tools. Again, critically important in the transition to ICD-10 when it’s not enough to simply code differently. You’ve got to collect differently as well.

Q. How does technology facilitate this process?

Barnes: Because MedData has a dedicated patient technology platform, we actually don’t care how many feeds we are receiving from groups that are connected with the hospital or from the hospital itself. We can take it from 11 or 14 or 17 other platforms, because we are taking the data into our system and aggregating it. That means more accurate billing information for our clients and their patients.

There was a fascinating McKinsey study showing that 72% of people owing $1,000 or less to doctors and other providers would happily pay if only they could make sense of the bill. Our technology platform—and our mission as a company—is to help patients understand their bills by clearing up any confusion about how much they owe, as well as their payment options. 

As a result, on average across our client base, we achieve a 30% increase in collections on patient balances, and we discover insurance on nearly a fifth of accounts that were previously categorized as straight self-pay. So we have happy, satisfied patients who pay what they owe and appreciate the way they were treated. Happy patients are loyal patients, and loyal patients who pay make happy clients. It’s a virtuous cycle that has helped to improve the RCM performance for our clients post-ICD-10 transition.

Q. What other transition insights are you hearing from your peers and colleagues in the industry at large?

Barnes: Coders are at a premium right now. People who were already not as efficient as they could have been are now being overwhelmed by the new ICD-10 requirements. As we’ve talked to hospitals, we’ve heard of productivity declines between 30% to 48%. They can’t get enough qualified coders to keep up with the decrease in productivity and as a result, they are drowning.

To me, this just puts more emphasis on the fact that you have to have technology and automation to support your people. This is not something you can just throw bodies at, and yet, there still are some organizations who are trying to do just that. While RCM has always been labor-intensive, successful companies have had to step up and innovate to provide a technology-enabled solution to keep up with increasing demand and complexity. 

MedData is very much a technology-enabled company. That’s what helps us stay successful, and it was the critical factor when it came to our successful transition to ICD-10.  

Another thing we’re seeing is that more and more hospitals and physician practices that were not outsourcing before ICD-10 are now rethinking their RCM strategies. A decrease in productivity and reimbursement inevitably hits cash flow and the bottom line. Healthcare providers need to focus on what they do best—providing clinical service—so it’s essential that they find partners whose core expertise is RCM. It’s the right decision for the health of their patients and the health of their balance sheets.  

Q. ICD-10 tripled the number of indications. Can hospitals and practices use this new information to drive improvements in RCM through data analytics?

Barnes: Absolutely. As ICD-10 improves documentation, data analytics are going to be much more telling than they were with ICD-9. The more information you can get about how and what specifically happened, the more you can learn and then apply going forward on the RCM side through improved and enhanced provider feedback and education. 

The bottom line: In revenue cycle management, the more specific the information, the more accurate and timely the reimbursement for our clients. That’s a huge incentive to get it right, reject the status quo and make improvements that are going to improve cash flow. 

Just as important, ICD-10’s increased level of specificity also means greater detailed insight for patient care over the longer term, regardless of facility type or medical specialty. It’s going to be a learning curve and a long journey for everyone involved, but it should be a journey with successful clinical, operational and financial outcomes for most.

Radiology is already well positioned for data analytics because of its highly digital nature. Having more specific inputs via ICD-10 only means better outputs. Using imaging analytics for insight into patient population health management and for better benchmarking, as an example, can only improve the delivery and outcomes of healthcare over the longer term.