How to Tap the Secret Power of ICD-9's

by Karen Wolfe

The medical portion of Workers’ Compensation claims now meets or exceeds 60% of claim costs. That fact alone should easily convince payers to focus on the rich medical information in their data. Very powerful information residing in claims data is virtually untouched—diagnostic codes in the form of ICD-9’s. The problem is few in the industry really understand ICD-9’s or in what ways they could inform powerful medical management.

ICD defined

ICD-9 codes are not unique to Workers’ Compensation. ICD-9’s are the World Health Organization's International Classification of Diseases, Ninth Revision, Clinical Modification (ICD-9-CM). They are a standardized method of describing injuries, illnesses, and related issues worldwide.

ICD is the classification that codes and classifies mortality data worldwide. The ICD-CM is used to code and classify morbidity data from inpatient and outpatient records and doctor’s offices.

The purpose of the ICD and of WHO (World Health Organization) sponsorship is to promote international comparability in the collection, classification, processing, and presentation of mortality statistics. New revisions of the ICD are implemented periodically so that the classification also reflects advances in medical science.

ICD’s in standard billing forms

Those who bill for medical services in the U.S. are required to use one of two CMS (Center for Medicare and Medicaid) standard forms, the HCFA-1500 (Health Insurance Claim Form) for outpatient and UB-04 Unified Billing) for hospitals and other facilities. Both standardized forms require the medical provider to list ICD-9’s appropriate to the medical procedures for which they are billing. The verdant data derived from these forms should be analyzed and incorporated into managed care processes.

Unwieldy and ignored

Bill review organizations and payers capture data from the standardized billing forms in their systems. Nevertheless, while the ICD information is documented in systems, it’s use usually stops there. ICD-9’s are difficult to interpret.

ICD-9’s on bills are displayed in the form of codes, not descriptions of injuries and illnesses and they number in the thousands. Individuals cannot remember the codes, nor do they have the time to look up codes for interpretation. Instead, they simply ignore them.

Secret power of ICD

Incremental essential knowledge resides in ICD-9 codes that can be translated to powerful medical management. When they are monitored electronically and concurrently, they reveal and inform.

ICD-9’s reveal migrating claims

For instance, migrating claims accrue ICD’s. Migrating claims are those that are not going well, are becoming more complex and costly, often an insidious process that is missed by claims adjusters and medical case managers until considerable damage is done. What happens in migrating claims is the injured worker is not recovering for some reason and is referred to multiple specialists. Each specialist adds new ICD-9’s to the claim.

As a claims migrates, and the number of ICD-9’s associated with it mounts.

Computer monitoring

Using a computerized system especially designed to monitor ICD-9’s is a powerful knowledge solution. Alerts are sent to appropriate persons when the number of ICD-9’s in a claim increases beyond a designated point. Migrating claims cannot be missed and intervention is early, therefore far more effective.

ICD-9’s are predictors

Another way to tap the secret power of ICD-9’s is to score them individually for medical severity, the seriousness of the injury or illness. Each claim then contains a total ICD-9 score in the system for medical severity. As ICD-9’s are added during the course of the claim, the claim ICD score increases. As a claim migrates and accumulates ICD-9’s, an appropriate person is automatically notified by the system. Migrating claims cannot go unnoticed.

Claims with high ICD-9 scores are predictors of risk and cost. Claim ICD-9 scores can be monitored from the outset and throughout the course of the claim.

ICD-9’s scores level the playing field

The claim ICD-9 score reveals the seriousness and complexity of a claim. Medical doctors managing difficult claims can be differentiated from those handling less arduous claims, thereby creating fairness in measuring provider performance.

Many indicators are used for claim monitoring and provider performance including medical cost, frequency and duration of treatment, indemnity costs, return to work and multiple other factors. The claim ICD medical severity score automatically predicts trouble and alerts the appropriate medical managers.

Moving on—ICD-10

The ICD-9 contains thousands of codes. Moreover, the ICD-10 revision will more than double the number of codes, making its information value exponential. ICD-10 is slated to be activated in October of 2014.

Karen Wolfe is President and CEO of MedMetrics®, LLC, an online Workers’ Compensation analytics company. MedMetrics analyzes data and provides “apps” online to link analytics to operations, thereby making them actionable. MedMetrics also monitors concurrent integrated data to detect potentially high risk or high cost events in claims and automatically alert the appropriate persons.

 

Diagnostic Scoring: a Powerful Predictive Indicator Uncovered

by Karen Wolfe
Wouldn’t it be great to know how medically serious an injury is at the outset of the claim without calling the doctor? Knowing the diagnostic severity for a claim is an invaluable decision support tool for many reasons. For one, knowing how serious the injury is helps in setting reserves.  It is also useful in applying resources appropriately for medical case management oversight. Moreover, scoring diagnostic severity on an ongoing basis is a means of capturing claims that are quietly migrating into greater complexity and cost.

Such knowledge has traditionally been elusive because the only available source was the doctor. It meant talking with the doctor to get a “feel” for how serious the injury is, not always a realistic approach. However, scoring  and monitoring claims for their diagnostic seriousness is a powerfully proactive medical management methodology.

ICD-9 documentation

Medical diagnoses are the way doctors describe medical conditions. ICD-9’s are required on standardized billing forms such as the HFCA 1500. The treating doctor uses ICD-9 codes, a standardized coding system, to describe injuries and illnesses.[1] While many factors can contribute to claim complexity, risk, and cost, a highly significant indicator of claim risk is the seriousness of the injury. It is almost too obvious.

Injury severity drives cost
The medical seriousness of the injury drives not only the medical costs of a claim, but also indemnity costs, return to work, claim duration, and even legal involvement. Sometimes more serious injuries spawn greater feelings of entitlement on the part of the claimant. Obviously, the more serious the injury, the more medical services will be required. Regardless of other factors, injury severity is the most basic driver of claim cost. Key decisions rest on how serious the injury is, but measuring severity by scoring ICD-9’s has not been done in the Workers’ Comp industry— until now.

Finding ways to measure and predict claim costs can be elusive, yet a necessary business requirement. The process relies on solid information gained early and throughout the course of the claim. Unfortunately, diagnostic severity has been overlooked as a source of information.

Predictive modeling
Predictive modeling using advanced mathematical devices is a valuable tool to estimate the end question of expected claim cost. It provides insight into future costs based on historic data found in similar cases. Analyzing historic data can often foretell the future when similar circumstances occur in a claim. Nevertheless, another easier and less expensive way to gain future cost insight is through diagnostic severity scoring.

Scoring Injury Diagnoses

A severity (seriousness) score is assigned to individual diagnoses found in medical bills. The bills found in bill review data can be monitored electronically throughout the course of the claim, beginning at the onset. Keeping a running score of diagnostic severity of a claim is revealing.

Elements of injury severity
Research has demonstrated what many professionals have long known: comorbidity adds to claim complexity and cost. Comorbidity means the claimant has other health conditions in addition to the workplace injury. For instance, the claimant might also be diabetic or have a cardiac condition or be grossly overweight.. These additional medical conditions can have an exponentially negative effect on recovery and therefore, claim outcome.

Research has also shown that age impacts claim complexity and cost, as well. Therefore, age should be factored into the scoring methodology.

Migrating claims accrue diagnoses
Claims adjusters and medical managers are well aware of another fact regarding diagnoses in claims. Claims accrue ICD-9’s as they migrate and become more complex. Consequently, it is important to score injury severity at claim outset and then continuously throughout the course of a claim. Claims that begin with a Medical Only status often insidiously creep into much more menacing levels without notice. Awareness of accumulating claim diagnostic severity scores prevents unseen slippage.

Timely knowledge saves money
The medical portion of Workers’ Compensation claims now accounts for 60% of claim costs, therefore, medical analytics is an even more critical component of claim management. Diagnostic severity scoring is a powerful addition to an organization’s portfolio of knowledge tools. Calling the doctor to determine how serious the injury is can be an unreliable and frustrating approach. A much better method is available.

Learn more about diagnostic scoring services at MedMetrics. It’s easy, reliable, and affordable.

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[1] ICD is the abbreviation for the International Statistical Classification of Diseases and Related Health Problems. ICD-9 refers to the ICD version currently in use. The ICD-10 version will be in required use in October, 2014.