CMS Announces ICD-10 1 Year Grace Period

There is no delay coming, but for one year after Oct. 1, CMS will pay for all claims that don’t have the correct ICD-10 codes as long as the codes used are in the ballpark. This is the biggest of several concessions CMS is making in light of the Oct. 1 deadline and the grave concerns providers have expressed with compliance. These measures will “allow for flexibility in the claims auditing and quality reporting process as the medical community gains experience using the new ICD-10 code set,” CMS said yesterday in a joint press release with the AMA.
It’s not a delay, but it is perhaps the most CMS could do short of continuing to accept ICD-9 claims after Oct. 1. Here’s a breakdown on the specific terms CMS announced.
• No claim denials. For the first year of ICD-10, from Oct. 1, 2015 to Oct. 1, 2016, Medicare claims will not be denied if the only problem was the use of inaccurate diagnosis codes. Any claim with ICD-10 codes in the appropriate family will be accepted and paid. Claims with ICD-9 codes will be not be accepted on or after Oct. 1, 2015.
• No ICD-10 audits. Medicare claims will not be audited based on the accuracy of ICD-10 diagnosis codes as long as they are from the appropriate family of codes. The idea is to give providers time to become familiar with the ICD-10 codes they’ll use, CMS said. Both Medicare carriers and Recovery Audit Contractors (RACs) will abide by this rule.
• No quality reporting penalties. Like the change to claim denials, CMS won’t penalize physicians under the Physician Quality Reporting System (PQRS), the value-based payment modifier, or the meaningful use program based on the specificity of diagnosis codes as long as codes from the correct ICD-10 family of codes are used
• Payment disruptions. If Medicare carriers have trouble processing claims because of the ICD-10 transition, CMS will allow advance payments to physicians.
• More communication. To stay on top of ICD-10 transition issues, CMS will create a special communications center to track problems during and after the run-up to October. A specific “ICD-10 ombudsman” will be named to sort through physician provider concerns and problems.
With only three months remaining before the ICD-10 deadline, these changes by CMS are the result of coordinated, even frenzied lobbying by physician groups, which, once assured that ICD-10 would not be delayed, pushed for some way to relax its potential financial impact.

“These provisions are a culmination of vigorous efforts to convince the agency of the need for a transition period to avoid financial disruptions during this time of tremendous change”, said AMA president Steven Stack, MD, in a statement. “These provisions are a testament to the power of organized medicine and what we can achieve when we band together for the food of our patients and our profession.”