Revenue Cycle Management Blog | GroupOne Health Source

Be Wary of the ICD-10 Grace Period

Written by Kaitlyn Houseman | September 28, 2015

With ICD-10 just 3 days away, healthcare providers and practices should be gearing up for the biggest change in healthcare to occur in decades. However, there seems to be a lot of debate and confusion surrounding the CMS announcement of a “grace period” with ICD-10. If you haven’t yet heard of the “grace period” it is intended to alleviate some of the concern surrounding the additional time physicians will need to spend on documenting with the new ICD-10 code set.

According to the CMS announcement, during the 12 months immediately following the October 1, 2015, date, “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 specificity of the ICD-10 diagnosis code as long as the physician/practitioner used a valid code from the right family.”

Even though ICD-10 has been delayed numerous times, the grace period is intended to give physicians and supporting staff more time to adjust to the ICD-10 learning curve. Skeptics believe the grace period is tarnishing the biggest benefit of ICD-10 which is to provide greater specificity while supporters seem to think the grace period is a “get out of jail free card.”

Here are 3 reasons we think it is still important to proceed with the necessary training, education, and testing necessary to get prepared for ICD-10.

1. You can't use just any ICD-10 code and expect to get paid for it.

CMS released an important FAQ document to clarify some of the questions that arose after the “grace period” announcement. In the FAQ document CMS further explains the meaning of the phrase “family” of codes. “Family” of codes is the same as the ICD-10 three-character category. The grace period is giving providers greater flexibility for specificity on codes submitted on claims that are within the same three-character category. Part B claims will still need to be submitted with fully valid ICD-10 codes. If a provider submits the three-character category code when additional characters are required under ICD-10-CM, the claim will be considered invalid.


2. The grace period will not relax the requirements of National and Local Coverage Determination Policies (NCDs & LCDs).

If a coverage policy currently requires a specific diagnosis under ICD-9 it will continue to require a specific diagnosis under ICD-10. The grace period does not change how carriers will apply NCD and LCD policies.


3. Other payers are not required to follow the grace period.

The grace period is not an excuse to stop preparing for ICD-10 or to think that documentation won’t need to be specific. CMS clearly stated in the announcement that the grace period applies for claims billed under the Part B physician fee schedule. Third party payers have yet to announce a 1 year grace period and are not required to do so. Providers and coding staff still need to learn the ICD-10 codes and how to use them in documentation.

The “grace period” may help with the learning curve for some but in the long run it isn’t helping providers and their supporting coding staff understand that eventually, if you don’t code properly in ICD-10, payers will deny your claims. Do not fall victim to believing the grace period is an excuse to put ICD-10 on the backburner. The grace period is there if you need it but it is not a backup plan so that your practice can delay ICD-10 preparation.