Claims Management January 26-29, 2015 Puerto Rico ICD-10 Site Visit Training segments to assist Puerto Rico with the ICD- 10 Implementation.

ICD-10 Overview

Program Integrity

Code Structure & Definition

GEMS, Translation & Dual Processing

Managed Care Alignment

Claims Management

Provider Communication

Analytics & IT Infrastructure

ICD-10 Testing

Post Implementation Impacts & Opportunities

Mapping & Policy Remediation

ICD-10 for Provider Offices

ICD-10 for Clinicians

Claims Management

January 26-29, 2015

Puerto Rico ICD-10 Site Visit Training segments to assist Puerto Rico with the ICD- 10 Implementation

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AGENDA Introduction ICD-10 Impacts Impact to Payment Maintain Stability / Manage

Change CMS Defined Service Workers Compensation MITA Business Processes SMA Programs and Services

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ICD-10 Impacts

Major Areas of Impact Claims Operations Provider Network Management Customer Service Clinical Operations Quality Management Disease Management Vendor Management Potential Impact to Production

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Downstream Impacts(Payers)

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Billing System

ClearinghouseGateway

EDI Transaction

EDI

Pre-adjudication Edits

Contract/Network Management

Benefit DesignCompliance Reporting

Quality AnalysisActuarial Analysis

Claims AdjudicationClaims Payment

Medical Management• Pre-authorization• Referrals• Medical Review• CM/DM

DATA WAREHOUSE

Fraud & Abuse

INPUT PROCESS

OUTPUT

ICD-10 Impact

Changes in Qualifier Changes in Number of Codes

837P (Professional) ICD-9 Qualifier

4010 Count

ICD-10 Qualifier

5010 Count

Principal Diagnosis BK 1 ABK 1

Secondary Diagnosis 1 BF 7 ABF 11

Total 8 12

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837I (Institutional) ICD-9 Qualifier

4010 Count

ICD-10 Qualifier

5010 Count

Principal Diagnosis BK 1 ABK 1Admitting Diagnosis BJ 1 ABJ 1Reason for Visit PR N/A APR 3External Cause BN 1 ABN 12Other Diagnosis BF 24 ABF 24ICD-9 Principal Procedure BR 1 BBR 1ICD-9 Other Procedure BQ 24 BBQ 24Total 52 66

1 - Includes “E” codes for ICD-9 Source: Health Data Consulting

Changes in Qualifier Changes in Number of Codes

837D (Dental) 2 ICD-9 Qualifier

4010 Count ICD-10 Qualifier

5010 Count

Principal Diagnosis BK N/A ABK 1Secondary Diagnosis 3 BF N/A ABF 3Total 4

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270/271 (Eligibility) 4 ICD-9 Qualifier

4010 Count ICD-10 Qualifier

5010 Count

Principal Diagnosis BK 1 ABK 1Secondary Diagnosis BF 9 ABF 7Total 10 8

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2 – ICD-9 are not supported in 4010 transaction3 – Includes “E” codes for ICD-9 4 - Place of Service codes be used in place of diagnosis code in 4010 (With Qualifier ‘ZZ’) but removed as an option from 5010

Source: Health Data Consulting

Changes in Qualifier Changes in Number of Codes

834 (Enrollment) ICD-9 Qualifier

4010 Count ICD-10 Qualifier

5010 Count

Disability Diagnosis 5 DX 1 ZZ 1

Total 10 8

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5 - Only value allowed is for End Stage Renal Disease for 4010 – Not restricted to ESRD in 5010

Source: Health Data Consulting

Additional Claim Impacts To Consider

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Claims processing during the transition period will require monitoring / Dual Processing

Claim history will contain ICD-9 and ICD-10 codes; consider impact

Applications used to look up claims may have to be modified

Staff Training

Update policies, manuals and procedures to accommodate ICD-10

Develop workarounds

Are Providers Coding Correctly?

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Will provider staff use codes that are most familiar

Consider effect if the incorrect code is utilized

Will providers collect the appropriate information

Challenge of training billers and coders

How will new requirements and documentation be met

Are providers aware of SMA plans to comply with regulation

Non – Medical Providers

Extended Care Facility

Department of Health

Non Emergency Transportation

School Based Providers

Non Agency Personal Care Aid

Home and Community Based Assisted Living

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Impact to Payment

M05651 Rheumatoid arthritis of right hip w involvement of other organs/systems

J9610 Chronic respiratory failure, unspec whether hypoxia or hypercapnia

M05651 Rheumatoid arthritis of right hip w involvement of other organs/systems

J9690 Respiratory failure, unspec, unspec whether hypoxia or hypercapnia

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DRG 469 Major joint replacement

or reattachment of lower extremity w/ MCC weight 3.4724 ($19,390)

ICD-10 procedure: 0SR90JZ – Replacement

of right hip joint w synthetic substitute, open

approach

DRG 470 Major joint replacement or reattachment of lower

extremity w/o MCC weight 2.1039 ($11,748)

ICD-10 procedure: 0SR90JZ – Replacement

of right hip joint w synthetic substitute, open approach

Diagnosis-Related Groups (DRGs) Unintended Consequence

A 50 year old woman with rheumatoid arthritis is admitted for a right total hip replacement. Patient is noted to have respiratory failure as a secondary diagnosis at the time of discharge, but this was not primary reason for hospitalization.

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Maintain Stability / Manage Change

Key Performance Indicators Rejections Claim Auto-Adjudication Rate Denials Claim Pends Claim Turnaround Time Aged Claim Backlog Incurred But Not Reported (IBNR) Quality Rate Appeals Customer Service Metrics

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CLAIMS!!!!

Critical Success Factors

Ability to accept electronic claims– Verify ICD-10-based inpatient claim procedure codes based on

dates of discharge – Verify ICD-10-based inpatient claim diagnosis codes based on

dates of discharge – Verify ICD-10-based outpatient claim diagnosis codes based on

dates of service – Verify ICD-10-based professional claim diagnosis codes based

on dates of service

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Critical Success Factors

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Ability to adjudicate claims– Verify auto-adjudication processing– Verify denials – Verify pending claims

Ability to pay Providers (Professional & Institutional)– Verify turn around time– Verify the DRG – Verify that claims can be processed natively in the DRG

grouper – Verify payment

Critical Success Factors

Ability to Pay Managed Care Organizations / Entities– Verify that ICD-10-based encounters can be accepted and

processed. Verify that the appropriate reporting and downstream processes occur (monitor post-implementation)

Ability to complete Coordination of Benefits and Exchange data

– Verify that claims anticipated to process to COB or TPL do so for ICD-10 based claims

Ability to create and send MSIS and/or TMSIS reports– Verify ability to create and send MSIS/T-MSIS reports

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Early Warning Indicators

Denial Rate

Claim Rejection Rate

Suspended or Pended Claims Rate

Paid to Billed Ratio

Aged Claim Backlog

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Non Covered Entity - WC It is “in non-covered entities’ best interest to use ICD-10: Increased detail in code information; The fact that ICD-9-CM no longer will be maintained; and The notion that mapping is not synonymous with coding. Research, including outcomes studies; The monitoring of resources for similar diagnoses; Setting of policy; Improvements in financial and administrative performance; Detection and prevention of fraud and abuse; and Tracking risk to employees.

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ICD-10 Early Warning Reports

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During the transition to the ICD-10, DHS will monitor for changes in claims performance that indicate an unintended impact to the financial integrity of the territory’s plan and/or services to Medicaid members.

Molina will develop the following metrics to monitor claims performance in the ICD-10 environment: Change in Claims Denial Rate Change in Claims Rejection Rate Change in Suspend or Pend Rate Paid to Billed Rate Aged Claims Backlog

Molina will develop Early Warning Indicator reports for the five metrics above to monitor performance prior to and after the transition date of October 1, 2015. Reports will be developed by July 2015 and will be run for August 2015 and September 2015 to baseline performance, and then run monthly thereafter to monitor performance until such time as DHS no longer requires the reports.

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CMS Defined Code Sets

Third Party Liability (TPL) EPSDT Hysterectomy, Abortion, Sterilization (HAS) Pay & Chase - preventative pediatric & prenatal services Family Planning Updated POA Lists Updated version of NCDs & LCDs TPL-0009-R - Accident Trauma Report Adult Core Set Technical Specs Emergency Conditions Codes

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COB / Third Party Liability

What will be the impact of ICD-10 considering that Medicaid is payer of last resort? Impact when entity is a non HIPAA compliant entity When primary entity has processing rules (i.e.

services span the compliance date, difference in “from date and through date rules” etc.)

Differences in mapping rules

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Introducing Medicaid Information Technology Architecture (MITA) 3.0

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Operations Management

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Price Claim/Value Encounter* Edit Claim/Encounter* Audit Claim Encounter* Apply Mass Adjustment*

Prepare Home Community Based Service (HCBS) payment (if adjudicated in the same manner as regular claims)*

Prepare COB

Business Processes

Expand the claims record to store the longer ICD-10 codes Expand the encounter record to store the longer ICD-10 codes

Expand the claims record to store additional occurrences of ICD-10 codes Expand the encounter record to store additional occurrences of ICD-10

codes If utilized, expand the ICD-10 field in the “store and forward repository”

For mainframe environments, may need to utilize filler or expand the copybook layout to accommodate longer ICD-10 codes

Expand both the claim and encounter record to store qualifiers for ICD-10 and ICD-9-CM codes

Data Structure Updates

Update the EDI translator to accept ICD-10 codes on 837I (Inpatient claim), 837P (Professional claim), 837 (Dental claim) claim transactions, also

NCPDP claims and prior authorization interfaces If utilized, update the interface to write EDI transactions to a store and

forward repository Update the interface between the EDI translator and claims adjudication

module to exchange ICD-10 codes Update imaging system that scan paper claims

Inbound System Interfaces

High Impact

Operations Management

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User Interfaces

Update Claims / Encounter data entry screens to accept ICD-10 codes Update user applications / look-up screens

Update X12 Implementation Assistance Handbook edits that use ICD-10 codes

Database that stores a snapshot of the EDI transactions submitted by providers. Some health plans use these to assist in responding correctly on

outbound EDI response transactions to providers. Update Medicare Severity (MS) Diagnosis Related Groups (DRG) (e.g.,

grouper software) for hospital claims and ambulatory payment processes. Develop a solution for processing claims/encounters when the dates of

service span the compliance date (e.g., instances where the prior authorization spans the compliance date)

Update any systems processing that uses ICD-9-CM codes in claims adjudication. Possible uses of ICD-10 codes include the following:

Automated Medical Review, Manual Medical Review , Pre-Payment and Post Payment Fraud Edits, Claims Grouping, Update Medicaid code editor,

Update MS Diagnosis Related Groups (DRG) (grouper software) for hospital claims and ambulatory payment processes, Claims Pricing, Prior

Authorization Verification, Benefit Utilization Checking, COB and TPL Identification

Update MS Diagnosis Related Groups (DRG) (grouper software) for hospital claims and ambulatory payment processes

Develop a solution for utilizing historical ICD-10 data that precedes the compliance date (e.g., utilization checking)

Develop a solution for processing claims/encounters when the dates of service span the compliance date

Business Rules and Edits

High Impact

Operations Management

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Update edits that identify COB cases during claims processing Develop a solution for utilizing historical ICD-10 data that precedes

the compliance date Develop a solution for utilizing / determining mapping or matching

of ICD-9-CM with ICD-10 so that there is correlation between old claims and new claims for the same case and / or episode of illness

Update the process to support the maintenance of historical data on TPL resource records

Update the process to identify / flag trauma diagnosis

COB Business Rules and Edits

High Impact

COB Business Rules and Edits

• Update 837 COB transaction to transmit claims to Trading Partners. This includes developing a solution for non-covered entity trading partners (e.g., auto insurance) that still use ICD-9-CM codes.

Operations Management

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Update reporting that includes ICD-10 codes. Reports

Update claims extract for Decision Support System (DSS) Update the interface between the claims adjudication subsystem

and the EDI Translator to exchange ICD-10 codes. Update the EDI translator to send 835 claims responses with ICD-

10 codes.

Outbound System Interfaces

High Impact

Financial Management

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Manage TPL Recovery Business Processes

Update edits that identify COB cases during claims processing Develop a solution for utilizing historical ICD-10 data that precedes the

compliance date. Develop a solution for utilizing/determining mapping or matching of ICD-9-CM with ICD-10 so that there is correlation between old

claims and new claims for the same case and/or episodes of illness Update the process to support the maintenance of historical data on TPL

resource records Update the process to identify/flag trauma diagnosis

Business Rules and Edits

Update 837 COB transaction to transmit claims to Trading Partners. This includes developing a solution for non-covered entity trading partners

(e.g., auto insurance) that still use ICD-9-CM codes.Outbound System Interfaces

High Impact

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Questions

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