October 2008

Moving On..The United States of America adopts ICD-10 codes

“The nicest thing about standards is that there are so many of them to choose from.” Ken Olsen, founder of Digital Equipment Corp., 1977


In August, the US government Department of Health and Human Services (HHS) announced that the currently used International Statistical Classification of Diseases and Related Health Problems 9th Revision-Clinical Modification (ICD 9-CM) will be replaced by the ICD-10-CM and ICD-10-PCS (Procedure coding System) codes. The proposal was welcomed by stakeholders in healthcare worldwide. The ICD-10 code sets are scheduled to take effect in the US in October, 2011. According to Mike Leavitt, Secretary of HHS, “The greatly expanded ICD-10 code sets will enable HHS to fully support quality reporting, pay-for-performance, bio-surveillance, and other critical activities. Conversion to ICD-10 is essential to development of a nationwide electronic health information environment, and the updated X12 transaction standards are a critical step in the implementation of these new codes.”

The US has lagged behind in the adoption of ICD-10 as it was only in 1988 that the country adopted ICD-9 standards.

The Center for Medicare and Medicaid Services also proposed a rule to migrate to Version 5010 of the Health Insurance Portability and Accountability Act (HIPAA) transaction sets, and Version D.0 of the National Council for Prescription Drug Programs’ standards. The switch to ICD-10 codes is required since the updated versions of the 1996 HIPAA, which lays down standards for electronic transaction in the medical field, use them. ICD-10 impacts HIPAA in the areas of claims, remittance advice, eligibility inquiries, referral authorisation, and other widely used transactions.


The rationale of the US HHS behind the upgradation is:

  • ICD-9 is outdated, with only a limited ability to accommodate new procedures and diagnoses.
  • ICD-9 lacks the precision needed for a number of emerging uses (for example, pay-for-performance and biosurveillance).
  • ICD-9 limits the precision of diagnosis-related groups (DRGs) as a result of very different procedures being grouped together in one code.
  • ICD-9 lacks specificity and detail, uses terminology inconsistently, cannot capture new technology, and lacks codes for preventive services.
  • ICD-9 will eventually run out of space, particularly for procedure codes.

Adoption of the ICD-10 code sets are expected to:

  • Support value-based purchasing by accurately defining services and providing specific diagnosis and treatment information, such as identifying cases of MRSA and other specific conditions, and would further Medicare’s ability to detect and prevent program abuse.
  • Support comprehensive reporting of quality data.
  • Ensure more accurate payments for new procedures, fewer rejected claims, improved disease management, and harmonisation of disease monitoring and reporting worldwide.
  • Allow the United States to compare its data with international data to track the incidence and spread of disease and treatment outcomes because the United States is one of the few developed countries not using ICD-10.

This said, ICD-10 has not been without criticism from some quarters. For example it does not highlight the mechanism of injury. The failure to produce mutually exclusive codes presents problems for determining the incidence of drowning events. It also differentiates between Asperger Syndrome and Autism almost solely on the basis of onset criteria.

The Blue Cross and Blue Shield Association (BCBSA) has issues with the timeline for moving to ICD-10 and Version 5010 standards. It believes that the notice period is too short and will lead to a ‘major meltdown’ among providers. They allege that the impact will include delayed provider and consumer payments, less ability to detect fraud and abuse, and higher IT costs due to the short deadline. BCBSA’s stand is backed by the National Committee for Vital and Health Statistics (NCVHS), which officially advises HHS on HIPAA matters. The American Medical Association and America’s Health Insurance Plans (AHIP) have also disapproved of the two-year switchover period.

The move from ICD-9 to ICD-10 will be expensive for the US. 95% of medical practitioners will have to purchase new Practise Management Systems or upgrade their existing ones. About two-thirds of practitioners will also need to buy code selection software in addition. ICD-9 has 17,000 codes whereas ICD-10 has over 155,000. HHS admits that the switch – like the NPI cutover – could initially cause significant cash flow problems for providers because of the increased risk of payment hold-ups due to coding and systems problems. HHS is predicting that claims-error rates will rise between 6 and 10% of all claims at the ICD-10 implementation date, up from a normal 3% rate typically seen for annual updates of ICD-9.

ICD is a precursor to the widespread use of electronic health records. There may be a need to expand the level of detail of classification entities by linking them to standard description of signs, symptoms and other descriptors of illness. These are being formally developed over the world as standard terminologies. The revision process should proactively define the linkage between terminologies (e.g. SNOMED-CT and other terminologies) and the ICD-11. The WHO believes that following the approval of the International Classification of Functioning Disability and Health (ICF) by the World Health Assembly as a WHO’s international framework to describe and report health and disability, there is a need to align ICD codes and their definitions with the ICF, and review their joint use as WHO reference classifications for public health purposes. According to a WHO collaborative study, the most common ICD-9 categories of diagnoses were depressive disorders, anxiety disorders, alcohol use disorders, and somatoform disorders.

What is ICD-10?

ICD-10 is a coding of diseases and signs, symptoms, abnormal findings, complaints, social circumstances and external causes of injury or diseases, as classified by the World Health Organisation (WHO). This latest standard was ready in 1992 after nine years of work. A downloadable version of ICD-10, second edition and a CD-ROM version, is available from the WHO e-commerce web site at
# .

Is ICD-10 uniform across the world?

No. Several countries have their own versions of the ICD-10 standard. Australia, Canada and Germany have all made modifications to the WHO standard. Modifications require the permission of the WHO.

What is Version 5010?

The updated version of the health care transactions standard would replace Version 4010/4010A1. The new version, Version 5010, includes structural, front matter, technical, and data content improvements. Since the updated versions are more specific in requiring the data that is needed, collected, and transmitted in a transaction, their adoption would reduce ambiguities. Version 5010 would also address a variety of currently unmet business needs, including, for example, providing on institutional demand an indicator of conditions that were “present on admission.” Version 5010 would also accommodate the use of the International Classification of Diseases, Tenth Revision (ICD-10) code sets, which are not supported by Version 4010/4010A1.

What’s next?

To keep the scientific currency and public health utility of the classifications, ICD is scheduled for 10 yearly periodic revisions and annual updates in line with the recommendations of the governing bodies of the WHO. Certain areas such as oncology, mental and addictive disorders, internal medicine, and external causes of injury have been identified by the WHO-FIC Network as main foci of the update and revision process. Work on ICD-11 has already begun. The first draft is expected to be ready in 2010 and is scheduled to be published about four years later.

Who influences the framing of ICD codes?

An update and revision process has been prepared by the WHO involving all stakeholders. The ICD-11draft is envisaged as a Joint-Authoring Tool much like the online encyclopeadia
Anyone can participate in the process. Just register at
and follow the guidelines to post proposals or comments. ICD-9 and ICD-10 regulations may be viewed at:

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