Healthcare Business Consultants: 5 HIPAA Considerations

Under HIPAA, all healthcare professionals covered under October 1, 2015, are required to use ICD-10 coding. Healthcare providers will face new challenges and complexity with the new coding system since it has five times as many codes as its predecessor, ICD-9.

It is the 10th revision of the International Classification of Diseases (ICD), a clinical cataloging system used by the U.S. healthcare industry. It is provided by the World Health Organization (WHO). A patient’s health records, including diagnoses, symptoms, and procedures, are tracked using these HIPAA compliance codes. Compared to the outdated ICD-9, which provided a 3 to 5-character code list and 13,000 available codes, the new list has a 3 to 7-character code range, containing more than 68,000 codes.

The ICD-10 transition may require considerable training, software upgrades, and careful planning due to the change in code complexity and increased specificity. As a result, many in the healthcare industry may face a financial burden and a sharp decline in productivity and collections.

Healthcare organizations should take into account the following five impact areas.

  1. Training

As a result of the new ICD-10 coding system, healthcare providers will need to transition their employees and possibly hire more staff to handle an increased workload. Users might take a while to adapt to the new system since the WHO provides online resources such as training guides, support, and study materials. Employees may also make mistakes due to insufficient training and a slow learning curve.

  1. Challenges in financial planning

Due to the learning curve any new system has an inherent learning curve, which means time and attention may have to be diverted from your usual billing and collection duties. Patients’ insurance providers may delay submitting claims to healthcare providers who experience difficulties with the conversion. Consequently, a longer revenue cycle and a potential cash crunch may occur.

  1. RACs (Recovery Audit Contractors)

The United States is the world’s largest payer of health services, with Medicare and Medicaid representing the largest payers. The United States Department of Health and Human Services hires RACs (Recovery Audit Contractors) to conduct recovery audits to detect fraudulent or abusive claims from healthcare providers. 

These auditors are authorized by law and can contact healthcare providers to request lengthy lists of documentation, just like an IRS agent can contact healthcare providers about tax returns. It has been speculated that billing errors under ICD-10 may lead to unintentional red flags in the government’s system, thereby increasing RAC activity, which ultimately adds to the time and cost of adopting the new system, which is costly and time-consuming.

  1. Medico legal coders

Despite their importance to the healthcare industry, qualified medical coders are already in short supply. They undergo rigorous training and screening to ensure their services are accurate and efficient. There is concern that this labor pool will shrink even further with the implementation of ICD-10. A company that cannot hire enough staff may have to hire more expensive contract coders.

  1. Risks related to security

If you do not already have a vendor management program, businesses that depend on outsourced professionals during the ICD-10 transition might consider setting one up. There may be information security risks if third-party vendors have access to sensitive data of covered entities or business associates. Healthcare companies are particularly concerned about this, as they must comply with HIPAA regulations. Having your data breached may cost you a lot of money to repair.

Interesting Related Article: “Comprehensive Guide About The Most Common HIPAA Violation”