HIPAA Administrative Simplification: Modifications to Medical Data Code Set Standards to Adopt ICD-10-CM and ICD-10-PCS

Standards. The final rule adopts modifications to two code set standards in the Transactions and Code Sets final rule that required compliance by covered entities on or after October 16, 2003. The new final rule, published in the Federal Register on January 16, 2009, modifies standard medical data code sets for coding diagnoses (ICD-10-CM) and inpatient hospital procedures (ICD-10-PCS). ICD-10-CM means International Classification of Diseases, 10th Revision, Clinical Modification for diagnosis coding, including the Official ICD-10-CM Guidelines for Coding and Reporting, as maintained and distributed by the U.S. Department of Health and Human Services (HHS). ICD-10-PCS means International Classification of Diseases, 10th Revision, Procedure Coding System for inpatient hospital procedure coding, including the Official 1cd-10-PCS Guidelines for Coding and Reporting, as maintained and distributed by HHS. Non-inpatient (ambulatory) procedures continue to be coded under the existing and new final rules using Current Procedural Terminology, 4th Edition (CPT-4) and Healthcare Common Procedure Coding Systems (HCPCS).

Modification of Transaction and Code Set Rule Diagnosis and Procedure Codes:


Current Code Set Modified Code Set
All Diagnoses International Classification of Diseases, 9th Revision, Clinical Modification, Volumes 1 and 2, including the Official ICD-9-CM Guidelines for Coding and Reporting, known as ICD-9-CM Volumes 1 and 2 ICD-10-CM
Inpatient Procedures International Classification of Diseases, 9th Revision, Clinical Modification, Volume 3, including the Official ICD-9-CM Guidelines for Coding and Reporting, known as ICD-9-CM Volume 3 ICD-10-PCS
Non-Inpatient Procedures CPT-4 and HCPCS CPT-4 and HCP

Most of the standards reflect updates. The Medicaid pharmacy subrogation standard is newly adopted, and two standards are adopted for retail pharmacy supplies and professional services.

Effective Date. The effective date is March 17, 2009. What is an effective date? “The effective date is the date that the policies herein take effect, and new policies are considered to be officially adopted.” [74 Federal Register 3328]

Compliance Date. The compliance date for the modification of the diagnosis and procedure code rule from ICD-9 to ICD-10 is October 1, 2013. What is the compliance date? “The compliance date is the date on which entities are required to have implemented the policies adopted in this rule.” [74 Federal Register 3328]

October 1 was chosen to coincide with the effective date of the annual Medicare Inpatient Prospective Payment System. The ICD-10 compliance date is 21 months after the compliance date for the 5010 rule. Based on healthcare industry input, “it appears that 24 months (2 years) is the minimum amount of time that the industry needs to achieve compliance with ICD-10 once Version 5010 has moved into external (Level 2) testing,” which commences January 1, 2011 (33 months before the ICD-10 compliance date).

“HHS has concluded that it would be in the health care industry’s best interests if all entities [emphasis added] were to comply with the ICD-10 codes set standards at the same time to ensure the accuracy and timeliness of claims and transaction processing…. The availability and use of crosswalks, mappings and guidelines should assist entities in making the switchover from ICD-9 to ICD-10 code sets on October 1, 2013, without the need for the concurrent use of both code sets [ICD-9 and ICD-10] in claims processing, medical record and related systems with respect to claims for services provided on the same day…. HHS believes that different compliance dates based on the size of a health plan would also be problematic since a provider has no way of knowing if a health plan qualifies as a small health plan or not.” [74 Federal Register 3335]

As is presently the case, coding before, on, or after the compliance date is based on the date of discharge.

Testing. “HHS has not established dates for Level 1 and Level 2 testing compliance for ICD-10 implementation. We encourage all industry segments to be ready to test their systems with ICD-10 as soon as it is feasible.” [74 Federal Register 3336] Recalling the definitions of Level 1 and 2 testing from the 5010 rule:

» Level 1 Testing: “The level 1 testing period is the period during which covered entities perform all of their internal readiness activities in preparation for testing the new versions of the standards with their trading partners. When we refer to compliance with Level 1, we mean that a covered entity can demonstrably create and receive compliant transactions, resulting from the completion of all design/build activities and internal testing.”

» Level 2 Testing: “The Level 2 testing period is the period during which covered entities are preparing to reach full production readiness with all trading partners. When a covered entity is in compliance with Level 2, it has completed end-to-end testing with each of its trading partners, and is able to operate in production mode with the new versions of the standards by the end of that period. By ‘production mode,’ we mean that covered entities can successfully exchange (accept and/or send) standard transactions and as appropriate, be able to process them successfully.”

Crosswalks. HHS acknowledges that crosswalks or mappings of data element code values between ICD-9 and ICD-10 “will be critical.” HIPAA Administrative Simplification requires under Section 1174(b)(2)(B)(ii) of the Act that “if a code set is modified under this subsection, the modified code set shall include instructions on how data elements of health information that were encoded prior to the modification may be converted or translated so as to preserve the informational value of the data elements that existed before the modification…and in a manner that minimizes the disruption and cost of complying with such modification.” [74 Federal Register 3337] Bi-directional crosswalks that can translate from the old code to the new or from the new to the old are referred to General Equivalency Mappings. The National Center for Health Statistics (NCHS) of the Centers for Disease Control and Prevention (CDC) has developed a bi-directional mapping between ICD-9-CM diagnosis codes and ICD-10-CM, which is available on line at the CDC website. The Centers for Medicare and Medicaid Services (CMS) has developed bi-directional mappings between ICD-9-CM Volume 3 and ICD-10-PCS and a guide for using the mappings, which is available here.

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