CMS announces one-year ICD-10 grace period

Physician practices worried about financial disaster related to ICD-10 implementation can breathe a sigh of relief, as the Centers for Medicare & Medicaid Services (CMS) has agreed to loosen penalties for imperfect claims submission within the first year providers use the more complex coding system, CMS and the American Medical Association (AMA) announced yesterday.

Despite the medical organizations' pleas for a two-year grace period to submit ICD-10 claims in a non-punitive 'practice' environment (or scrap ICD-10 altogether), physician practices will get one year, beginning on Oct. 1, 2015, free of penalty should they submit claims using ICD-10 codes that aren't as specific as possible.

Although CMS will not reject claims during the grace period solely on the basis of specificity, claims must still include a valid code from the correct ICD-10 family. In other words, explained Medscape, a claim for chronic gout, for example, will get paid if the physician or coder at least gets the M1A part of the code right, but misses on the cause, body location or tophus.

Similarly, physicians participating in quality reporting programs such as the Physician Quality Reporting System, the value-based payment modifier initiative or Meaningful Use, will not be penalized during the 2015 reporting year for failure to select a specific code, as long as they have selected one from an appropriate family of codes. 

Finally, practices that run into reimbursement problems due to administrative issues on CMS' end will be able to apply for conditional advanced payment, which they would have to pay back, noted a post from Manage My Practice.

Although CMS' concessions do not include an implementation delay or complete reprieve, they represent good news for practices, blogger and consultant Mary Pat Whaley said. "The transition is inevitable, in my mind, but the changes will lessen the burden on physicians and hospitals," she wrote in Manage My Practice.

To learn more:
- read the announcement (.pdf)
- see the post from Manage My Practice
- read the article from Medscape