Payment Denials for Unspecified Codes

From the day coders got their first glimpse at ICD-10 codes, the question went out in the land: “Will payers deny unspecified codes?” Recently, a client told me that she was seeing an increase in denials for unspecified codes from payers and I wanted to gather more information about that. Thank you to the 140 people who responded to this survey. Of course, it’s not a scientific random sample. You may have been more likely to answer the survey if you were seeing denials. But, the results are still informative.

Who selects the diagnosis code for encounters in medical practices?

There was a pretty even split between a coder or biller selecting a diagnosis code and a practitioner selecting a diagnosis code. Most respondents, 45%, said that a practitioner selected the code with coder review.

Do you have payers that deny unspecified codes?

This was an overwhelming yes, almost 80%. (Again, you may have been more likely to take the survey if this is true in your group.) When asked what payers denied unspecified codes, based on the survey I would say all of them. But every person didn’t select all payers. Clearly there is a difference in various markets as to which payers are denying unspecified codes. Medicare, Medicare Advantage, Medicaid, managed Medicaid, and commercials were all listed and selected, but not everyone selected all of them.

There were many helpful, insightful comments. All of them were anonymous (so we don’t know who you are and no one else does either).

“There is not a consistent pattern.”

“We have not been seeing denials for unspecified codes.”

“All insurances vary in their denials to the point it is almost impossible to remember each one’s preferred rule.”

“Denials for unspecified codes mostly come from our Medicaid plans. Denials for laterality come from all payers.”

“It seems the number of payers enforcing this practice is on the rise, as we are seeing an increase in denials from multiple commercial payers. It is not just laterality, but also unspecified codes that have no other option.”

“Our supervisor said that if there is no other option or unable to determine a more specific code, go ahead and release the claim and they will deal with the payer after the claim denies.”

“End up doing a reconsideration and submitting medical records explaining that a more specific code is not available.”

Do payers deny if a specific code for laterality is submitted?

A whopping 60% said yes to this question. In the comments, using an unspecified code when right, left, or bilateral are ICD-10 options. This seemed to be the most consistent type of unspecified denial that was described.

One commenter said using an unspecified trimester code caused denials, as well.

Do payers deny unspecified codes for which a more specific code/diagnosis can’t be made at the visit?

40% of respondents said yes, and about 39% said no. For me, this is the most frustrating type of denial. There are instances in which a more specific diagnosis code can’t be made at the time of the visit. For example, J18.9, pneumonia. When a patient is in the office, these are often treated without a sputum sample to know the organism. Pharyngitis and some sinus infections are other examples. Of course, use “fever” and the claim can get paid, but that doesn’t follow ICD-10 rules. We don’t code a symptom of a known condition.

Two comments seemed to indicate that when these are denied and appealed or a reconsideration is asked for, the claim is paid. What a colossal waste of time for everyone.

A member in Vermont said that the state Medicaid plan had a list of unspecified codes that would be denied. And this included these types of denials. After letter writing and complaints, some of those diagnosis codes were removed from the list. Probably easier done in a small state than trying to influence the policies of a large commercial company.

Thank you to all who participated in this survey. I learned from it, and I hope sharing the information is helpful to you.