Updated on: November 21, 2016

ACLA Putting LCDs Under Microscope as ICD-10 Approaches

Original story posted on: September 14, 2015

Have you reviewed your Medicare Administrative Contractors’ (MACs’) new local coverage determinations (LCDs) that include ICD-10 codes instead of ICD-9 codes? Do they include the full range of ICD-10 codes that map from the ICD-9 codes in current or former policies?

Some of them don’t, warns JoAnne Glisson, senior vice president of the American Clinical Laboratory Association (ACLA). The ACLA and its members are in the process of reviewing LCDs, and it appears that some MACs have altered their coverage policies for certain laboratory services.


For example, in a May 15 letter to the Centers for Medicare & Medicaid Services (CMS) representatives, Glisson included the following examples of future LCDs that do not recognize the full range of ICD-10 codes that map to ICD-9 codes in the corresponding LCD:

  • Palmetto GBA’s current LCD on flow cytometry
  • National Government Services’ LCD for a RAST-type test

In a subsequent meeting held in July,CMS indicated that it asked the above contractors to correct the above examples. 

Coverage Limitations

In addition to possibly not using the ICD-10 general equivalency mappings (GEMs), says Glisson, contractors may have decided to use the ICD-10 transition as a way to limit coverage for clinical laboratory services without first allowing stakeholders to comment.

“We have found that several of the future LCDs do not include the full range of ICD-10 codes that map to the ICD-9 codes in the current policies,” she wrote.

A CMS representative explained to Glisson that “just because an ICD-9 crosswalked to a fuller array of ICD-10s doesn’t necessarily mean that the limited coverage policy would support the full array of cross-walked ICD-10s. It would depend on the coverage articulated in the policy itself.”

Nonetheless, this may result in non-coverage for some currently covered laboratory services, and it also may result in laboratories having to code improperly in some cases in order to be paid for their services, she said.

However, Glisson notes that limiting coverage in this way goes against the guidelines in the Medicare Program Integrity Manual.Chapter 13, Section 13.7.2 notes that contractors must provide a comment-and-notice period for revised LCDs that restrict existing LCDs, such as adding non-covered indications to an existing LCD and deleting previously covered ICD-9 codes.

ACLA is continuing to work with individual contractors to discuss specific codes that it believes have been omitted in error, and Glisson encourages labs to “remind the contractors that the transition to ICD-10 should not be used to alter coverage policies.”

Nonspecific Codes

One of the CMS-approved guidelines requires coding at the highest level of specificity – that is, assigning the most specific diagnosis code that describes a disease or condition. In some cases, Glisson says, the ICD-10 codes that are included in certain LCDs would cause labs to use codes on claims that are not the most specific available. She provided the following example of National Government Services’ future LCD for a RAST-type test:

ICD-9 code 989.5 (toxic effect of venom) maps to 152 more granular ICD-10 codes. However, just seven of the 152 ICD-10 codes are in the future LCD. Each of those seven ICD-10 codes are for “undetermined” venomous animal types, yet the ICD-10 codes in the “T63” family of codes are far more specific about the type of venomous animal involved in the injury or accident. A laboratory may know that it is conducting a test because of a patient’s accidental encounter with a coral snake (ICD-10 code T63.021A), but in order to get paid for the test, the lab would be required to include the ICD-10 code for “toxic effect of venom of other snake, undetermined, initial encounter” (ICD-10 code T63.094A). This would contradict longstanding CMS policy and HIPAA coding basics, and it would put labs in the untenable position of coding properly or coding to be paid.

Flexibility – But Not for Labs

To mitigate potential problems, and in response to requests from the provider community, on July 6 CMS released guidance that 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.” (This news release can be found online at http://www.cms.gov/Newsroom/MediaReleaseDatabase/Press-releases/2015-Press-releases-items/2015-07-06.html.).

A valid ICD-10 code still will be required on all claims starting on Oct. 1, 2015, but some lenience will be allowed for physicians and practitioners. For 12 months after ICD-10 implementation, CMS has explained, Medicare review contractors “will not deny physician or other practitioner claims billed under the Part B physician fee schedule through either automated medical review or complex medical record review based solely on the specific of the ICD-10 diagnosis code as long as the physician or practitioner used a valid code from the right family.”

The fact that ordering providers have been given this flexibility but labs have not is inherently unfair and wholly illogical, Glisson noted.

“We are extremely troubled by the inherent unfairness of a policy that provides no flexibility to laboratories but that provides some measure of flexibility to physicians (in the medical review context). Laboratories are not in a position to select the ICD-10 codes on claims they submit,” she said. “Apart from being unfair, it is wholly illogical to provide flexibility to a physician who can select the most specific code for a patient encounter and not to provide that same flexibility to a laboratory that is not in a position to select the right ICD-10 code, yet that similarly bills Medicare for services arising from the same patient encounter.”

It is now the case that ordering physicians and practitioners provide invalid and nonspecific ICD-9 codes, and this is likely to continue under ICD-10, resulting in claim rejections or denials. Added to these factors, Glisson says, is the “general belief that there may be less of a need to provide correct ICD-10 codes, as a matter of fairness, laboratories should benefit from a similar approach.”

We ask that any flexibilities that CMS has provided or will provide to physicians and practitioners with respect to ICD-10 implementation also be extended to laboratories and other ancillary service providers.



Information Sources

Disclaimer: Every reasonable effort was made to ensure the accuracy of this information at the time it was published. However, due to the nature of industry changes over time we cannot guarantee its validity after the year it was published.
Janis Oppelt

Janis keeps the wheel of words rolling for Panacea®'s publishing division. Her roles include researching, writing, and editing newsletters, special reports, and articles for RACMonitor.com and ICD10Monitor.com; coordinating the compliance question of the week; and contributing to the annual book-update process. She has 20 years of experience in topics related to Medicare regulations and compliance.

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