In July, the Centers for Medicare and Medicaid Services and American Medical Association jointly announced new ICD-10 flexibilities in the Medicare claims auditing and quality reporting process, which are meant for physicians and other practitioners whose claims are billed under the Part B physician fee schedule.

However, even with these flexibilities, there are some “additional caveats” that providers should be aware of so that they know exactly what will happen after the October 1 ICD-10 compliance date goes into effect, according to CMS Chief of Staff Mandy Cohen, M.D.

Also See: CMS Corrects Recent ICD-10 Guidance for Physicians

For 12 months after the October 1 deadline, if a valid ICD-10 code is used from the right family of codes, Medicare will process and not audit claims solely for the specificity of the ICD-10 code, Cohen said. She emphasized that the flexibility applies as long as a valid code is used from the correct family of codes, which she said is the “same thing as the ICD-10 three-character category.” Codes within a category are clinically related and provide differences in capturing specific information on the type of condition.

“If the code on a claim is not valid, it will be rejected before being accepted for claims processing,” Cohen cautioned. “If it’s rejected, you have the opportunity to resubmit the claim with a valid ICD-10 code. But, there are certain circumstances where a claim could be denied for a different reason.”

For instance, she said a claim may be denied because an ICD-10 code is not consistent with an applicable policy, such as Local Coverage Determinations or National Coverage Determinations.

Another flexibility discussed by Cohen relates to the CMS quality program.  For program year 2015, she said Medicare will not subject physicians or other eligible professionals to the Physician Quality Reporting System, Value Based Modifier, or Meaningful Use penalties during primary source verification or auditing related to the specificity of the ICD- I0 code.

Again, Cohen reiterated that an eligible professional will have to use a valid code from the correct family of codes, adding that an EP will not be subjected to a penalty if CMS experiences difficulty calculating the quality scores for PQRS, VBM, or MU due to the transition to lCD-I0 codes.

If EPs have additional questions about these ICD-10 flexibilities, she said they should contact CMS through the following email address— –with the word “flexibilities” in the subject line.

“While we encourage coding to the correct level of specificity at all times, the additional flexibilities will assist the medical community as it gains experience with new ICD-10 codes,” concluded Cohen. “We’re hoping these flexibilities allow physicians and other providers to get comfortable with the ICD-10 code set as we transition. And, we hope that this alleviates some anxiety around the transition itself.”

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