What are ICD codes and CPT codes? ICD means International Statistical Classifications of Diseases. ICD codes are alphanumeric designations given to every diagnosis, description of symptoms, and cause of death attributed to human beings.

CPT (Current Procedural Terminology) codes are numbers assigned to every task and service a medical practitioner may provide to a patient (although not a Medicare patient – see note below) including medical, surgical and diagnostic services. They are then used by insurers to determine the amount of reimbursement that a practitioner will receive by an insurer. Since everyone uses the same codes to mean the same thing, they ensure uniformity.

Effective October 1, 2014, Obamacare has mandated the ICD-9 code sets used to report medical diagnoses and inpatient procedures be replaced by ICD-10 code sets. The transition to ICD-10 is required for everyone covered by the Health Insurance Portability Accountability Act (HIPAA). The change to ICD-10 does not affect CPT coding for outpatient procedures and physician services.

The updated code sets will allow, and in fact will require, significant changes in the way health plans reimburse services, and in the way coverage of services is determined. ICD-10 will enable significant improvements in care management, public health reporting, research, and quality measurement.

Computer science, combined with new, more detailed codes of ICD-10-CM, will allow for better analysis of disease patterns and treatment outcomes that can advance medical care. These same details will streamline claims submissions, since these details will make the initial claim much easier for payers to understand.

ICD-10 is not required for entities and organizations that are not covered by HIPAA, including worker’s compensation programs. However, not adopting ICD-10 and requiring a different billing method can be expected to impose significant hardships; so many carriers are voluntarily making the switch.

The additional complexity of ICD-10 codes exists primarily for the reason of creating medical codes that are more specific and provide more information on what happened, where it happened, what was done in response, and what the diagnosis actually is. Under ICD-9, a submitted claim may not have accurately affected the reality of an injury, resulting in payments that were either above or below what should have been paid as compensation. ICD-10 makes a significant advance towards eliminating this problem, allowing more accurate and useful information to be transmitted and processed.

Benefits for Worker’s Compensation Programs

Having more accurate information is not the only realm in which ICD-10 affects worker’s compensation programs. A number of other positive effects have been noted, including:

  • More efficient tracking of health trends and observed problems
  • Enhanced detection of abuse, fraud, and false claims
  • Improving overall administrative performance both within and outside the program
  • More effective monitoring of resources and time
  • Streamlined planning of programs and offerings
  • Greater ability for research, clinical trials, and other medical tests
  • Simplified payment systems
  • Thorough measurements for safety, quality, and efficacy
These diverse benefits, allowing better accuracy and control, offer a significant advantage for worker’s compensation programs. However, the additional complexity of ICD-10 also means that some current plans will have to be modified or eliminated, as they may be unworkable or inefficient under the updated system. A worker’s compensation program should be ready for the change as soon as possible, if it does plan to convert, and should also be certain that any medical practice it works with is equally prepared.