Electronic Health Records

Policy & Regulation News

CMS Clarifies Flexibilities After ICD-10 Compliance Deadline

By Kyle Murphy, PhD

- The Centers for Medicare & Medicaid Services (CMS) has provided clarification concerning its joint announcement with the American Medical Association (AMA) on flexibilities following the October 1 ICD-10 compliance deadline.

CMS clarifies the flexibilities it will provide following the ICD-10 compliance deadline

On Monday, the federal agency released answers to numerous frequently asked questions in response to feedback from members of the healthcare industry.

First and foremost, CMS reiterates in the FAQs that the July 6 announcement in no way signifies another ICD-10 delay.

"Medicare claims with a date of service on or after October 1, 2015, will be rejected if they do not contain a valid ICD-10 code," the federal agency states. "The Medicare claims processing systems do not have the capability to accept ICD-9 codes for dates of service after September 30, 2015 or accept claims that contain both ICD-9 and ICD-10 codes for any dates of service. Submitters should follow existing procedures for correcting and resubmitting rejected claims."

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  • Of particular importance to healthcare organizations and providers is what constitutes a valid ICD-10. CMS has furnished them with an answer:

    ICD-10-CM is composed of codes with 3, 4, 5, 6 or 7 characters. Codes with three characters are included in ICD-10-CM as the heading of a category of codes that may be further subdivided by the use of fourth, fifth, sixth or seventh characters to provide greater specificity. A three-character code is to be used only if it is not further subdivided. To be valid, a code must be coded to the full number of characters required for that code, including the 7th character, if applicable. Many people use the term billable codes to mean valid codes. For example, E10 (Type 1 diabetes mellitus), is a category title that includes a number of specific ICD-10-CM codes for type 1 diabetes. Examples of valid codes within category E10 include E10.21 (Type 1 diabetes mellitus with diabetic nephropathy) which contains five characters and code E10.9 (Type 1 diabetes mellitus without complications) which contains four characters.

    A complete list of the 2016 ICD-10-CM valid codes and code titles is posted on the CMS website at http://www.cms.gov/Medicare/Coding/ICD10/2016-ICD-10-CM-and-GEMs.html. The codes are listed in tabular order (the order found in the ICD-10-CM code book). This list should assist providers who are unsure as to whether additional characters are needed, such as the addition of a 7th character in order to arrive at a valid code.

    According to the FAQs, CMS will specify whether a claim is rejected for an invalid code versus a lack of specificity required for Local Coverage Determinations (LCD) or National Coverage Determinations (NCD). CMS has warned that the guidance will not result in changes to current automated claim processing edits, meaning that certain ICD-10 codes would be rejected if "not consistent with an applicable policy."

    Regarding Medicaid, CMS notes that added ICD-10  flexibility only applies to Medicare fee-for-service claims. However, the Medicaid programs in each state will be "required to process submitted claims that include ICD-10 codes for services furnished on or after October 1 in a timely manner."

    Additionally, CMS makes clear that 12-month one-year period of claims payment review leniency in no way guarantee that commercial payers will follow suit.

    Read all the FAQs here.



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