Budgeting for the ICD-10 transition will be trickier than you think. You need to set aside funds for more than software and equipment upgrades.
There will be two types of ICD-10 transition costs to include in your budget: direct and indirect costs.
Direct costs are kind of easy to spot. Each area requires resources - time and money - to accommodate. These are items such as:
Software and hardware
- In house and vendor modifications
- New software, systems and equipment
- Coder training
- Clinician education
- Awareness raising
- Testing related costs
Staff time needed for:
- Implementation planning
- Vendor management
Temp staffing to assist with extra work resulting from:
- Decreased coding productivity
- Billing backlogs
- Claims denial and rejection management
- IT work on upgrades and systems
- Lost time during training
- Consulting services
Forms and reports
- Printing costs
- Data conversion
- Added time
- Maintaining data collection
- Analyzing data
Indirect costs are the factors that can reduce cash flow and revenues:
- Drop in productivity
- Increased accounts receivable cycles
Ken Bradley, vice president at Navicure, writes that medical practices can offset the revenue implications of ICD-10 implementation through several steps:
- Thorough education and training
Bradley also points out that these steps may not inoculate your medical practice against revenue cycle disruptions. He suggests securing a line of credit in advance.
Carl Natale blogs regularly at ICD10Watch.com.