An ICD-10 implementation case study: Sutter Health How a large, regional healthcare system is transforming a huge, complex project one step at a time

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1 FierceHealthIT Sponsored by: An ICD-10 implementation case study: Sutter Health How a large, regional healthcare system is transforming a huge, complex project one step at a time By Julie Bird For one in five hospitals, the scope, complexity and expense of converting to ICD-10 medical codes not to mention skepticism about the perceived benefits of the switch have pushed the ICD-10 transition to the back burner. The U.S. Department of Health and Human Services (HHS) made that easier last year when it delayed the transition deadline by 12 months, to Oct. 1, But for Sacramento, Calif.-based Sutter Health, the strategy driving its four-year, $100 million ICD-10 implementation program was changing the perception of this from just being a mandate to being an opportunity for us, says Jon Manis, senior vice president and chief information officer for the non-profit 24-hospital healthcare system. That means looking at how we engage with our physicians, how we communicate, engage and partner with our vendors and how we do those things in the interest of providing better patient care, Manis says. It s an enormous job. Sutter Health has about 5,000 affiliated physicians and 47,000 employees total most of whom will require at least some ICD-10 training. The system s acute-care hospitals range in size from the 30-bed Sutter Lakeside Hospital and Center for Health in Lakeport, Calif., to the 945-bed California Pacific Medical Center in San Francisco. And although Manis emphasizes that a key to a successful transition is remembering that ICD-10 is an organizational priority, not an information technology department program, IT is at the heart of the transition. Half of Sutter s $100 million transition budget is earmarked for health IT, primarily new software and remediation of existing applications.

2 ICD-10 planning and strategy Sutter s ICD-10 efforts rely on participation from leaders with varied areas of expertise. Manis established an ICD-10 program management office in the fall of 2010 and appointed Danielle Reno program director. After a vendor completed an impact assessment the following spring, Sutter formed an executive steering committee of senior revenue cycle and information systems (IS) leaders to guide the effort. Manis is the executive sponsor of the steering committee. Christopher Jaeger, M.D., vice president of medical informatics, is co-chair along with Brian Hunter, vice president of revenue cycle and Jennifer Sierras, vice president of corporate client services. Early on the healthcare system identified 13 areas of focus for the ICD-10 transition, including clinical documentation improvement (CDI), computer-assisted coding (CAC), revenue cycle and health information management (HIM), and vendor and trading-partner readiness. The project management office formed work groups for each of those areas to develop work plans including strategies, priorities and timelines, which it then presented to the executive steering committee, Reno says. As those plans are finalized at the system level, information is disseminated to Sutter s five geographic regions and to the affiliates, or facilities, in those regions for execution. 13 areas of focus for ICD-10 prep Early in the ICD-10 transition planning process, Sutter Health identified 13 areas of focus and formed workgroups to address each. They are: 1 Clinical documentation improvement 2 Education 3 Communications and change management 4 Computer-assisted coding 5 Testing 6 Application services 7 Crosswalks 8 Data and online services 9 Vendor/trading partner readiness 10 Dual coding 11 Managed care and reimbursement 12 Revenue cycle/health information management (HIM) 13 Clinical research and operations Application remediation and testing Work began in spring 2011 to remediate applications across the system identifying every software program that would need to have its computer code rewritten to accept or send ICD-10 codes instead of ICD-9 codes. When we reconfigure something and it gets tested, we need to be sure that it flows that data from one application to the next, and that it also flows that data outside of our organization to clearinghouses and thirdparty contracted payers, such as commercial payers and Medicare, Reno says. There s a lot to it. Half our budget is allocated to it. Testing of systemwide applications was conducted at the system level, but regional teams were responsible for testing their own applications on a timeline set by Reno and her team. Getting feedback is part of the strategy development, she says. It s important to have candid conversations about whether something will work, if it will work for every reason and whether there are there other people that need to be involved in those conversations outside of the executive steering committee to make those decisions, she adds. 2

3 Sponsored Content Staying ahead in the era of healthcare reform: Navigating ICD-10 challenges On October 1, 2014, ICD-10 code sets will replace the ICD-9 sets used to report medical diagnosis and inpatient procedures. Health organizations should already be working toward implementing ICD-10 into their clinical systems and developing training plans for healthcare providers. In addition, organizations will need to take the time to look downstream to their billing and A/R practices and measure the impact there. Health organizations should already be working toward implementing ICD-10 into their clinical systems and developing training plans for healthcare providers. Healthcare providers must bill for Medicare services with ICD-9 prior to October 1, 2014, and with ICD- 10 for services provided thereafter. That seems pretty straightforward, but how will providers manage this? Will clinical and coding systems or staff suddenly stop using ICD-9 on October 1 and start using ICD-10? There will be a period in September and early October where they will be required to code as both. And, for patients who have services that span both months, organizations will need to code those services with both ICD-9 and ICD-10. Will staff and systems be smart enough to pick the correct coding? What if mistakes are made and a clinician picks from the wrong set? Health organizations must also determine if all of the payors and plans that bill will be ready. Will they be prepared to receive ICD-10 on October 1 or will their staff need to know who the payor is and what coding is required to pick from the right set? The same considerations apply to contracts, medical necessity, and other edits dependent upon diagnostic coding. Taking steps to transition to ICD-10 coding There are steps that organizations can take to manage all of this without running into issues with denials for claims or timing issues. And Infor Healthcare Revenue Cycle Management can help. Multiple clinical systems can feed directly into the software, and if some clinical systems have begun coding in ICD-10 and some are still using ICD-9, it can accept both. Essentially, organizations can migrate their systems to ICD-10 as they are ready. The system can use customizable rules to determine which coding set to use for payors, based on effective dates for that payor s transition to ICD-10. Automated coding for Medicare billing For Medicare, healthcare providers can choose October 1 as their effective date, and begin coding their clinical systems in ICD-10 at any time. When billing Medicare, Infor Healthcare Revenue Cycle Management translates the ICD-10 to ICD-9 prior to the October 1 effective date. Once the effective date hits, the system will automatically begin billing services with ICD-10. The software takes the guesswork out of billing, so organizations don t have to monitor which coding set is used at which time. To help healthcare providers be prepared in this era of change and reform, Infor is committed to providing solutions that are purpose-built for healthcare organizations and the challenges they face. Learn more about how Infor Revenue Cycle Management can help your organization at go.infor.com/bottomline 3

4 6 secrets to a successful ICD-10 transition Sutter Health CIO Jon Manis identifies the following as the secrets to a successful ICD-10 transition: 1 Recognize and communicate that ICD-10 isn t just another regulatory requirement it s an organizational priority. 2 Designate a dedicated project director and set up a project management office. 3 Get all health information management personnel from across the organization involved in the transition. 4 Make sure all physicians are engaged in and aware of ICD-10 transition activity. 5 Put together comprehensive dashboards and reports to ensure regular tracking and progress reporting. 6 Don t waste the one-year implementation delay; use it as an opportunity to engage even further in driving improvements related to ICD-10. Key dates and deadlines for the transition to ICD-10 Wherever your organization is on the path to transitioning from the ICD-9 code set to the new ICD-10 code set, there are a number of key steps to accomplish and deadlines to meet. Here s how the timeline played out for Sutter Health including steps the organization has already completed and goals leading up to the October 2014 go-live deadline. Because Sutter Health was planning at the time for the original 2013 transition deadline, it sent surveys to affected application vendors as early as 2010 to assess their readiness, Reno says. With a few exceptions primarily noncritical applications where the vendor has not yet provided ICD-10 updates system-level applications were reconfigured for ICD-10 by mid HHS s decision to push back the transition deadline gave the healthcare system time to do more robust testing, she says. The next step was integration testing, which is ongoing. Testing is a critical area, she says. We re testing the ability of the data to flow from one application, like our electronic health record, to a downstream ancillary application like lab or radiology services. We re testing whether [data] can be coded and transmitted to a claim. One of this summer s tasks is preparing the technical landscape for the transmission of data between Sutter Health and commercial payers, including invoices and payment, Reno says. The so-called payer collaboration comes after months of discussions between the healthcare system and its payers, she adds. External testing through clearinghouses and payers begins in the fall of Documentation improvement and computer-assisted coding Meanwhile, in the clinical documentation improvement department, CDI managers and physicians are coming Fall 2010: Set up Project Management Office Spring 2011: Completed impact assessment Established executive steering committee Launched initial awareness campaign Summer 2011: Began remediation of application systems and systems testing Mid 2012: Launched physician engagement program Fall 2012: Kicked off staff education with one-week boot camps for coders, clinical documentation specialists and compliance teams. The program included training in anatomy and physiology to increase understanding of medical terminology. Continued ICD-10 coursework online and through WebEx training sessions. Began crosswalk analysis and mapping Early 2013: Reviewed commercial contracts and completed revenue impact analysis 4

5 together to discuss both standardizing and improving the specificity of documentation to support ICD- 10 coding. They re also determining the best way to educate physicians about their role, Reno says. We certainly have an opportunity for improvement with how we document under ICD-9 now, says Jaeger, the vice president of medical informatics. The focus is not to turn physicians into excellent ICD-10 coders. We don t even really want them coding. We want them documenting well about the care they re rendering and have coders do their work, with computer-assisted coding to supplement that. Previous documentation-improvement efforts occurred at the hospital level. Now, thanks to the ICD-10 transition, there s a systemwide effort that can also tackle existing problems in documentation, Jaeger says, such as the noise created when clinicians cut and paste extraneous information from standard electronic health record links into their notes. Physician champions at the regional and affiliate May 2013: Began integration testing Identified physician champions for locations and specialties Selected regions to go live with computerassisted coding, starting with Sutter s Peninsula Coastal Region July 2013: Kicked off physician education program August 2013: Expanded awareness campaign via Intranet and video communications Launched dual coding, with internal records including both ICD-9 and ICD-10 codes Fall 2013: Begin payer and third-party trading partners testing 2014: Continue training and education up to the go-live date Summer 2014: Complete six cycles of integration testing Complete payer and third-party testing Oct. 1, 2014: ICD-10 system goes live The focus is not to turn physicians into excellent ICD-10 coders. We don t even really want them coding. Christopher Jaeger, M.D., vice president of medical informatics, Sutter Health 5

6 levels act as liaisons between the healthcare system and front-line doctors. In addition to communicating the enterprise CDI model to physicians and other clinicians, they re helping different medical specialties determine where documentation can have the greatest impact, whether positive or negative, he says. Jaeger says the best way to communicate the benefits of ICD-10 to sometimes-skeptical physicians is to break it down into components, such as CDI that overlap with other improvement efforts. It s also best to select five or 10 high-impact areas and focus on those during training, and to realize that different-sized facilities may have different training needs, he says. It s about the granularity of documentation to improve patient care, specifics around disease processes and how we communicate with our patients, adds Manis, the CIO. More specialized care-management programs as a result of having better data. Improvement in the quality of our data those are the kinds of things we like to highlight and emphasize. The lesson there for ICD-10 transition teams, says Manis: Do the necessary, but emphasize the positive. Another workgroup is focusing on CAC, in which a natural language processor reads electronic documentation and suggests a list of code for coders in HIM services to analyze and accept, Reno says. It frees coders from having to look up all the medical documentation to figure out the appropriate codes. I think one of the reasons people look at computerassisted coding as a tool is because there s set to be this decrease in productivity at go-live from a coding perspective, she says. The new coding language in ICD-10 is so complex that this CAC tool is supposed to eliminate some of that productivity issue. We re looking to see if that s going to happen for Sutter Health. Meanwhile, as coders continue ICD-10 training that began last fall with week-long boot camps, a work group is looking at what kind of record queries need to be put in place so physicians can begin documenting as though ICD-10 was already in effect, Reno says. Lessons learned Manis says perhaps the biggest challenge was getting people to understand the importance of ICD-10. It was about helping the organization to understand this wasn t just a coding issue, that this wasn t an application or a technology issue, that it impacted the patient care encounter all the way through the reimbursement for the care, he says. This transition to ICD-10 really impacts all aspects of our business and care model. Over time, technical challenges emerged. Although the systems testing that began in the summer of 2011 did not reveal any significant problems, Reno says the ICD-10 project team did not initially plan to test connectivity for applications that didn t hold or transmit ICD-10 data. But when you look at integration testing and flowing through all of the applications from one end of the revenue cycle to payment of the claim, you have to include those applications, and we hadn t set up the connectivity there, she says. I think that was a big lesson learned in those initial stages of testing. We have already built that planning into our future stages. Another lesson was the importance of building time into the schedule for unexpected contingencies, Reno says. These events can include vendors being unable to update their applications within the hospital s timeframe, she says, or having to build functional capability into technical applications for payers that will not accept ICD-10 code. With as big of a transition as this is, and the organizational complexity that goes along with it, I think that if we hadn t built in contingency time, we might not be where we are today, she says. And I do feel like we re way out in front of a lot of providers. 6