CMS, AMA offer additional guidance on ICD-10 coding flexibility

As you may have heard, earlier this month the Centers for Medicare & Medicaid Services (CMS) and the American Medical Association (AMA) announced a series of changes aimed at easing physicians’ transition this fall from ICD-9 to ICD-10 coding.

In particular, the changes provided flexibility for practices still grappling with the large number of new diagnosis codes and the increased level of specificity required. CMS said that for the first year ICD-10 is implemented, physician claims will not be denied solely because the diagnosis code is not specific enough as long as it is from the appropriate “family” of ICD-10 codes.

Like everything else attached to the Oct. 1 switch to ICD-10, this announcement generated its own share of confusion. To help clarify the situation, CMS this week released a series of frequently asked questions and answers about the changes.

Some of the more important points:

• This is not a delay in the implementation of ICD-10. Medicare claims with a date of service on or after Oct. 1 will be rejected if they do not include a valid ICD-10 code. “Valid” is defined as having the full number of characters required for that code to be billed, which could require up to seven characters.

• CMS has defined “family of codes” as the ICD-10 three-character category, such as H25 (age-related cataract). Most categories include additional characters that provide additional information, such as the type of condition and what part of the body is affected (for example, H25.22 for age-related cataract, morgagnian type, left eye). Physicians still must provide a "valid" code, which means they will likely have to report more than just the initial three category characters.

• CMS noted that claims may still be denied for being insufficiently specific because automated claims processing edits that are tied to Local Coverage Determinations or National Coverage Determinations are not changing based on the new guidance. Also, Medicare fee-for-service prior authorization requests and prepayment reviews will still require ICD-10 codes with the correct level of specificity.

• The loosening of the specificity requirement does not extend to Medicaid claims, only to those billed under the Medicare fee-for-service Part B physician fee schedule. It also doesn’t extend to private payers unless those payers determine to offer similar flexibility.