Editor's note: H&HN Daily, in partnership with the College of Healthcare Information Management Executives, is pleased to present "ICD-10 In Real Time." In this 12-month blog series, three leading CIOs share their experiences on ICD-10 implementation, physician engagement, productivity, payer readiness and more. The blog will run on the first Wednesday of every month.

First came ARRA, with built-in HITECH provisions including certification, standards, meaningful use and so on. Next, PPACA, and all the while, ICD-10-CM and -PCS loomed on the horizon, just in case we did not have anything else to do with our daily lives.

There's long been a lot of hoopla, weeping and gnashing of teeth surrounding the conversion to ICD-10. Secretary Sebelius' Feb. 16 announcement that HHS would delay the planned Oct. 1, 2013, implementation launch to an unspecified date has added a whole new level of complication and makes it that much more difficult to draw the linkage between ICD-10's potential and its impact on health care costs.

In 2004, the Rand Corp. published a cost-benefit study measuring the cost of implementing ICD-10 versus the cost reduction benefits over time. It pointed out the vast age difference between ICD-9, which dates to the 1970s, and ICD-10, which was issued in 1993. They also pointed out that one-time implementation costs were estimated at between $425 million and $1.15 billion, and that lost productivity will range between $5 million and $40 million per year for up to 10 years. Further, the productivity loss is focused almost exclusively on coders and physicians.

The upside of the ledger: the benefits. Rand predicted benefits to inure from:

  • More-accurate payments for new procedures
  • Fewer miscoded, rejected and improper reimbursement claims
  • Better understanding of the value of new procedures
  • Improved disease management
  • Better understanding of health care outcomes (considered, but not estimated)

Tied back to dollars, the estimates ranged from $700 million to $8 billion over a 10-year period. So, on the surface, it appears ICD-10, both CM and PCS, return substantially more in hard dollars than what it will cost. Though both costs and benefits have wide ranges, on the surface the balance tips in favor of implementation. That is especially true when we factor in the outcomes benefits that Rand did not estimate.

Few would argue that U.S. health care, which is eclipsing 17 percent of GDP and growing at a rate that would put it at nearly 20 percent by 2019, is simply not sustainable by any measure. Further, I submit, few would argue that all means of curbing the rate of growth and perhaps actually reducing it as a percentage of GDP, warrant serious consideration. ICD-10-CM and -PCS are critical pieces of the equation if we are to achieve a sustainable health care system that meets our demanding quality requirements. I would never champion an approach that hinders improvements in quality of care; cost containment that enhances quality has to be a most favored path if attainable.

Some would argue that waiting for ICD-11 would be the correct course in view of the delay. Though we have no idea at this writing of how long HHS will delay ICD-10 implementation, speculation ranges from a few months to two years. Two years puts us at 2015 and on a possible collision course with the release of the World Health Organization's revised ICD-11 codes. However, that ICD-11 date isn't solid either, and its underlying structure is fundamentally different from ICD-10. That means vast amounts of additional rework of systems and processes to utilize ICD-11 and a total scrapping of all efforts done on ICD-10.

And consider this: ICD-10 was introduced by WHO in 1993 and scheduled for implementation in the United States first in 2011, then pushed back to 2013 and now delayed until who knows when. So, ICD-10 will be at least 20 years old by the time we get around to utilizing it in the United States. If we followed the same course for ICD-11 (and skipped over ICD-10), we're looking at 2033 before retiring ICD-9. That is too long a wait.

A new coding system, whether it is ICD-10 or -11, brings with it heavy burdens, especially by requiring more input from physicians, and a retraining for coders. That said, health care costs are unsustainable at 20 percent of GDP by 2019.

I have not spoken with a physician yet who does not see outcomes benefits in more granular data. Further, physicians with whom I have spoken also believe that by appropriately mining more granular data, new and better quality-based, data-driven protocols can and will be developed, yielding better patient outcomes. Lastly, I believe we all acknowledge that better outcomes can and will drive a reduction in costs.

Certainly, a nearly ninefold increase in codes will make data more granular. We could argue about the efficacy of some of those additional codes and, indeed, some may be superfluous, but the fact that data is captured at a more granular level is, in my mind, indisputable. It also could be argued that this granular-level data may be used to reduce reimbursement, thus costing the providers money. On the other hand, an argument could be made that correct and accurate coding may enhance the level of reimbursement. I believe we all want to be paid fairly for what we actually do, and document to support coding to the highest level that truly represents what transpires medically. Whether cynic or optimist, all would agree that if ICD-10 were correctly used, the granular data would now be present.

In a perfect world, this granular-level data will be captured accurately by the provider, coded correctly and reimbursed fairly, all of which leads to better patient outcomes and, ultimately, reduced costs. That said, one can easily ask: REALLY?

At the end of the day, it truly comes down to this: Do we believe that the data captured with this new coding scheme will provide the data to drive improved outcomes? I do. REALLY. Accepting that premise allows me to look at the benefits that Rand didn't estimate: better understanding of health care outcomes. I, too, am unable to estimate that, but believe it is real. REALLY.

We have our challenges ahead, but the path is correct. Consistent with HITECH and PPACA, ICD-10 is a correct step. Given time, ICD-11 most likely will be also, but as a nation I do not believe we can afford to wait much longer, and I believe in a positive cost impact of this move. Further, I believe that as an IT professional, it is our challenge to mitigate as much of the physician and coder burden as we can, but to move ahead as we must. REALLY.

Stephen M. Stewart is CIO of Henry County Health Center, a critical access hospital in southwest Iowa. He is a regular contributor to H&HN Daily's ICD-10 series.