3 Steps for Safeguarding Cash Flow Through ICD-10 Change

Home health agencies grappling with the transition to the impending ICD-10 code set could experience reduced cash flow without proper preparation, according to a guide released by Dallas-based home health software vendor Axxess this week. Preparing for the transition in advance, however, might help your organization avoid such a consequence.

About 69,000 new medical codes officially go into effect Oct. 1 after a delay in implementation, replacing the approximately 14,000 codes currently available with ICD-9, according to Axxess. The adoption of the new code set is meant as a way for providers to keep up with advancements in medicine and the health care system’s growing data commands.

All home health agencies deemed “covered entities,” or providers that conduct certain financial and administrative transactions such as electronic billing and fund transfers as defined by HIPAA, are required to comply with the new requirements. However, non-covered entities would benefit from using the latest medical codes as well, since the previous format will no longer be supported.


By nearly quintupling the number of medical codes, though, home health providers should expect the burden of technology upgrades, staff training, delayed payment and increased claim denials in the coming months, all of which either directly or indirectly affect cash flow. American Health Information Management Association research suggests that providers should expect a drop in productivity of 54.4% to 69% during the first year of ICD-10 implementation as a result.

While the transition may seen daunting, there are steps home health agencies can take to minimize its impact on their businesses.

  • Plan: Considering imminent issues an agency might face could help mitigate reduced cash flow, and developing solutions early will alleviate panic when such problems arise.
  • Update: Ensuring that home health software in place can handle the transition and updating technology if necessary to accommodate ICD-10 will make for smooth implementation.
  • Train: Properly training personnel is crucial to minimize the transition’s influence on cash flow. This involves not only going over the ICD-10 codes themselves, but also learning about any new or updated software.

“Agencies that delay action, or rely on unprepared software vendors, will find themselves struggling through the transition and jeopardizing their financial stability,” the Axxess guide states.


Written by Kourtney Liepelt

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