Diagnosis Coding to the Highest Level of Specificity Means Fewer Claim Denials

Each year the Centers for Medicare and Medicaid Services (CMS) release updates to the ICD-10-CM diagnosis codes that are effective on October 1st. In this annual update process, diagnosis codes may be added, revised, or deleted. Coding professionals review such code changes, paying close attention to diagnosis specificity. But an important official guideline change, effective October 1, 2021, may have gone unnoticed. The ICD-10-CM Official Guidelines for Coding and Reporting, General Coding Guideline I.B.2. Level of Detail in Coding, was updated as follows (bold font indicates new language added): “Diagnosis codes are to be used and reported at their highest number of characters available and to the highest level of specificity documented in the medical record.”

Though, it is sometimes necessary and acceptable to use unspecified diagnosis codes, it’s important to look for additional clinical information about a condition and code to the highest level of specificity documented. For example, Zegan (2018) shared a case example where an emergency department provider documented “non-displaced right talus fracture” but the X-ray specified a “non-displaced avulsion fracture of the right talus.” In this example, diagnosis code S92.101A (Unspecified fracture of right talus) may be assigned. But on closer review, code S92.154A (Non-displaced avulsion fracture of right talus) is more appropriate based on the greater specificity documented by the radiologist in the imaging report. [1] This is a great example of the need to continually train your ‘coder eye’ to code to the highest level of specificity, a coding guideline that’s becoming more and more important.

CMS instituted a grace period to facilitate ICD-10-CM/PCS implementation (between October 1, 2015 and October 1, 2016) in which claims were not denied as long as codes were assigned within the valid code family. That grace period is no longer in effect and claim denials are increasing. More recently, CMS has twice proposed to remove all unspecified diagnosis codes from the CC/MCC lists for DRG grouper assignment. They have yet to implement that, but the hand-writing is on the wall. “The goal is to report specific diagnosis codes when they are supported by the available medical record documentation and clinical knowledge of the patient’s health condition- and use unspecified codes only when they are the best choice to accurately reflect the healthcare encounter.”[1] Effective April 1, 2022, the Medicare Code Editor (MCE) was updated to apply a new edit for unspecified laterality. The diagnosis codes that trigger this new MCE unspecified code edit are found in the FY22 Inpatient Prospective Payment System (IPPS) Final Rule, Table 6P.3a.

You can read more on this topic in the Journal of AHIMA, including additional examples of diagnosis coding specificity and a list of conditions commonly reported with unspecified diagnosis codes. To find out your unspecified code rate, or for assistance with accurate coding, contact UASI today.

  1. Zegan, Jacquie. “Improving Specificity in ICD-10 Diagnosis Coding.” Journal of AHIMA 89, no. 4 (April 2018):44-46.