THOMAS J. VILSACK, GOVERNOR DEPARTMENT OF HUMAN SERVICES
SALLY J. PEDERSON, LT. GOVERNOR KEVIN W. CONCANNON, DIRECTOR
Informational Letter No. XXX Page 2 of 2
Hospitals Billing With CPT and/or HCPCS Level II Procedure Codes
RE: New 2007 CPT and HCPCS Level II Coding Updates
December 19, 2006
Informational Letter No. 561
To: Hospitals Billing With CPT and/or HCPCS Level II Procedure Codes
From: The Iowa Department of Human Services, Iowa Medicaid Enterprise
RE: New 2007 CPT and HCPCS Level II Coding Updates
Effective Date: January 1, 2007
The Iowa Medicaid Enterprise (IME) is updating the Medicaid Management Information System (MMIS) to reflect new 2007 CPT and HCPCS Level II codes that will be effective January 1, 2007. These updates will involve addition of new codes/descriptions, as well as deleting discontinued codes from payable status.
In the past, Iowa Medicaid has allowed providers a three-month grace period to begin using new CPT and HCPCS Level II codes that become effective each January 1st. This allowed providers to continue using and being paid for discontinued codes on claims for dates of service on/after January 1, through March 30. Unfortunately, this option will not be available to providers this year. This is due to the volume of coding changes this year, combined with the impracticality of maintaining two code sets in MMIS and corresponding challenges to correctly pay claims, where providers use both old and new codes. It should also be noted that we are following Medicare policy in this regard. [1]
Therefore, all Iowa Medicaid providers that bill for covered services using CPT and/or HCPCS Level II codes MUST begin using the 2007 CPT and 2007 HCPCS Level II codes for all dates of service on/after January 1, 2007. Any claims for dates of service on/after January 1, 2007 using a CPT or HCPCS Level II code that is no longer valid for 2007 will be denied. Should this occur, providers may resubmit the claim with the appropriate correct 2007 code.
Special Note To Hospitals: A small percentage of outpatient hospital claims using the new 2007 CPT and/or HCPCS Level II codes will be suspended until February or March, 2007. This is because the IME does not receive the updated APG grouper software from 3M in time to have the MMIS fully updated for outpatient claims by January 1. We have learned from past experience that until the grouper is updated, claims with NEW codes will not group to the appropriate APG and will deny incorrectly. Therefore, the IME will suspend all such claims until the APG grouper is updated in order to avoid incorrect payments. Please note that this will affect the entire claim, not just the line item(s) including the new CPT or HCPCS Level II code. We expect this to be a very small percentage of the claims submitted. The updated APG grouper will be operational sometime in February or early March of 2007. Any claims that suspend for this reason will be reprocessed at that time. For your information, it is also noted that a separate reprocessing of claims will otherwise be necessary to reflect the 3 percent increase (effective July 1, 2006). This will occur when the State Plan Amendment related to that increase is approved by CMS. Please note, however, that the “3 percent” reprocessing will occur after the reprocessing of outpatient hospital claims that will be suspended relative to the new code/APG adjustments.
Remember, these changes are effective for dates of service on/after January 1, 2007.
If you have any questions, please contact IME Provider Services at 1-800-338-7909 or locally 515-725-1004, or by e-mail at: .
[1] CMS Change Request (CR) 3094 eliminated the 90-day grace period for discontinued ICD-9 codes effective October 1, 2004 and CMS Change Request (CR) 3093 eliminated the 90-day grace period for discontinued HCPCS codes (i.e. Level I, which includes CPT codes and Level II) effective January 1, 2005.