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11/21/2013    Pam Thompson

RE: ICD-10, a Recipe for Disaster? (Neil Hecht, DPM)

ICD-10 has adverse financial consequences well
beyond those concerned with preparation for the
transition. A Canadian hospital study of ICD-10
implementation reported physician productivity
losses of 50% in the first month. A year later,
the loss continues, at 19%. It is unlikely that
the change-over in the U.S. will fare much better.

Anticipation of claims processing interruptions,
coding errors and other FUBAR'd but heretofore
unknown issues, are estimated to result in at
least 5 percent physician income loss, and up to a
30 percent short-term cash flow loss. Of course,
income loss is money you'll never see again.

CMS estimates that claim denials will increase 100
– 200 percent. Days in A/R (how long it takes to
pay you) will increase 20–40 percent. Claim error
rates will increase 6–10 percent based on improper

The cash flow loss could extend for three to six
months. Do you have operational capital to cover a
5 percent income loss and a 20-30 percent cash
flow loss for three months? Six months? It will be
of great benefit to prepare for the attendant
revenue interruption.

Is it possible that this will not occur? That
payers will reimburse you just like they always
do, promptly and correctly, with no untoward
delay, underpayment or calls for additional
information? That they won't take advantage of an
opportunity to use ICD-10 "problems" to advantage
themselves at physician expense?

I've recommended that my clients focus as much on
increasing revenue and decreasing costs as they do
directly preparing for the Oct 1st transition. A
healthy credit line would be helpful.

Pam Thompson, Guerrilla Podiatry,

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