Projected ICD-10 Conversion Costs Triple

The costs for physician practices to implement the federally mandated transition to the ICD-10 code set are three times earlier estimates, according to a new American Medical Association study.

Using the new report as ammunition, AMA "strongly urged" U.S. Health and Human Services Secretary Kathleen Sebelius to "reconsider the mandate." In a letter to the secretary, AMA Executive Vice President James Madara, MD, wrote, "AMA policy adopted by our House of Delegates calls for repealing ICD-10 for the simple reason that it is not expected to improve the care physicians provide their patients and, in fact, could disrupt efforts to transition to new delivery models." (TMA was instrumental in the AMA house adopting that policy.)

The study, conducted by Nachimson Advisors, compared current estimates of ICD-10 conversion with Nachimson's widely reported 2008 report.

  Typical Small Practice Typical Small Practice Typical Large Practice
2008 estimate $83,290 $285,195 $2,728,780
2014 estimate $56,639-$226,105 $213,364-$824,735 $2,017,151-$8,018,364

"The previous estimate did not account for the costs to upgrade to certified electronic health record (EHR) software since Congress had not yet enacted the Meaningful Use Program," Dr. Madara wrote. Another major factor is "the potential for increased payment disruption," the study reports, estimating that 2 percent to 6 percent of all claims filed under the new coding system will be denied by payers.

TMA joins AMA in calling for a repeal or delay of the ICD-10 mandate. "Implementing the massive changes by Oct. 1, 2014, will bring about confusion and extraordinary burden, particularly to small practices and primary care physicians," TMA told members of Congress in early February. "The Centers for Medicare & Medicaid Services (CMS) should, at a minimum, beta-test this system among a variety of practice types and locations to make sure it actually works. Even more appropriate would be to repeal the ICD-10 coding system for physician practices altogether and gear up for ICD-11, which is right behind."

TMA urges physician members not to count on any respite from Congress or Secretary Sebelius. The association offers physicians and practice staff extensive tools and resources to help you prepare for the Oct. 1 deadline:

Action, Feb. 18, 2014

Last Updated On

June 13, 2016

Originally Published On

February 14, 2014

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