Should hospitals use ICD-10-PCS codes for outpatient procedures?

Carl Natale
by Carl Natale

The federal government is going to require a bit of dual coding at hospitals. This isn't anything new.

As part of ICD-10 implementation:

  • ICD-10-CM codes will be used for all inpatient and outpatient diagnoses
  • ICD-10-PCS will only be used by hospitals for inpatient procedures
  • CPT will be used by all healthcare providers for outpatient procedures

This is federal law. And there is no sign these requirements will change.

This means hospitals will have to employ two types of medical coders who will work with medical procedures:

  1. Medical coders who know CPT coding
  2. Medical coders who know ICD-10-PCS coding.

The CPT coders already exist. They're using CPT codes already. The ICD-10-PCS coders need to be trained. Many hospitals are relieved that not all of their medical coders will need to be trained.

Except some HIM professionals are making the case to code inpatient and outpatient procedures in ICD-10-PCS. That means procedural coders will need to understand ICD-10-PCS and CPT coding even though federal law will not require it.

The reasons why come down to two basic concepts:

  1. Standardized data on all procedures
  2. Medical coders with more scheduling flexibility

There is the worry that some healthcare payers may require ICD-10-PCS codes in addition to CPT codes. Although CPT codes are required now for reimbursement, some payers do require ICD-9-CM codes also. So maybe they will want ICD-10-PCS codes after Oct. 1 also.

I'm not a lawyer so I cannot speak to the legality of this. The HIPAA law is clear that only CPT codes will be required for reimbursement by non-covered entities. Maybe healthcare payers can add extra reporting requirements.

Why would they want to?

Data is like oxygen to payers. Standardizing data will help them make decisions. Of course that relies on the payers being able to manage the transition.

Healthcare payers won't be the only entities to worry about. Some medical registries and data collection agencies may require ICD-10-PCS codes. Again, standardized and very specific data. Many healthcare organizations prefer ICD codes for research.

So some hospitals may require ICD-10-PCS codes internally.

But Darlene Hyman, a coding project manager at Upper Chesapeake Health System, has a detailed list of why their outpatient coders will not use ICD-10-PCS codes.

It mostly comes down to training. Basically, training inpatient and outpatient coders will increase the ICD-10-PCS training budget and require more medical coders to dedicate time to training. And it's not just the initial training that will be an issue. Continuing education will need to be budgeted.

Plus outpatient coding productivity will decrease also. There is a chance that hospitals will need a stable source of reimbursements. Of course that's assuming that healthcare payers will be able to process CPT-coded claims while they're struggling with ICD-10 coded claims.

There is a concern that there will be increased documentation requirements for outpatient procedures. This could be unnecessary since it isn't mandated. But is it less efficient to have two sets of documentation requirements? It seems hospitals will want the more specific documentation requirements even though it's not needed to support CPT requirements. There will fewer chances for mistakes that don't supply enough documentation for ICD-10-PCS codes.

And having procedural coders who can use both code sets should give hospitals enough scheduling flexibility to help productivity.

Again, the question is whether the investment is worth the benefit.