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Medicaid Programs Prepare for ICD-10 Code Update

Medicaid Payment Perspectives helps Medicaid programs and other payers improve the methods used to purchase care and services for their beneficiaries. It’s published by the Payment Method Development team at Conduent.


Medicaid Programs Prepare for ICD-10 Code Update

Medicaid payers and providers are counting down to an explosion of ICD-10 coding changes on October 1, 2017. The ICD-10-CM and ICD-10-PCS updates are posted to the CMS website and include 360 new diagnosis codes and 3,562 new surgical procedure codes:

FY 2018 ICD-10 Diagnoses ICD-10 Procedures
Adds 360 3,562
Changes 226 1,821
Deletions 142 646

A freeze on code changes for ICD-9 and ICD-10 had been in place since 2011 due to the long-delayed implementation of ICD-10, which finally came on October 1, 2015. During that time, only minor revisions were made with no regular, annual updates. The first wave of changes came on October 1, 2016, with 1,943 new diagnosis codes and 3,651 new procedure codes.

Now a second wave of coding changes is about to hit, the result of catching up with years of putting off updates. Just like last year, the large volume of code changes will require Medicaid programs to allocate significantly more resources into evaluation and remediation efforts across areas such as business rules, service authorization criteria, TPL criteria, program integrity review and data analytics. Medicaid programs must get an early start on the analysis activities to avoid being unprepared when the codes go into effect.

While the changes to ICD-10-CM and ICD-10-PCS codes and guidelines are numerous, a few that are important to highlight include:

  • Substance abuse: New codes are added for remission from abuse of a variety of substances, including alcohol, nicotine and opioids, which are a high priority amid the nation’s opioid epidemic. The new codes classify severity as mild, moderate or severe.
  • Antenatal screening: 17 new Z codes describe specific screening tests administered to pregnant patients, including chromosomal abnormalities and fetal growth retardation.
  • Myocardial infarction: New codes require providers to identify the type of infarction. I21.A1 (myocardial infarction type 2) and I21.A9 (other myocardial infarction type) will be added October 1.
  • Heart failure: New codes include various types of right heart failure, which include acute (I50.811), chronic (I50.812), acute on chronic (I50.813) and unspecified (I50.810). There are also four other new codes for right heart failure due to left heart failure.

Some other points that should be considered as Medicaid programs update their systems include:

  • New code Z40.03 (encounter for prophylactic removal of fallopian tubes): This code is intended for a female who has been medically advised to preemptively remove her fallopian tubes (the tubes from the ovary to the uterus) for her overall better health and wellness. Perhaps she has a strong family history of cancer or has had genetic mapping. For Medicaid programs that have restrictions on sterilization and family planning, we recommend that this code not be associated with indicators that would trigger those restrictions.
  • Gender edits: Of the 360 new diagnosis codes, it is recommended that eight of the new codes be associated with a male. This can be determined with Table 6P.1b Sex Conflict Edit from the IPPS Final Rule for Medicare Code Editor. For example, this year two codes from the symptom chapter were related to males only. There are other Medicare resources used to validate such edits.
  • Other sterilization and family planning concerns: For the new procedure codes this year, there are several related to the male reproductive organs potentially impacting sterilization and/or family planning.

Conduent’s Payment Method Development team has certified coders with experience in assisting state Medicaid agencies and/or fiscal agents in reviewing the code changes in relation to established policy. We analyze existing system parameters, system lists, TPL criteria and other logic assigned to current codes and mimic that policy for new codes by understanding the descriptions and definitions of the new codes. We can also:

  • Perform a review of a Medicaid program’s indicators and systems list before or after October 1, 2017, for the FFY 2018 update
  • Perform a second level review of what has already been assigned
  • Perform a review of indicators and systems list for the ICD-10 codeset from October 10, 2015 through October 1, 2017 to assure the definition of the ICD-10 code was accurately interpreted per the definition of the parameter

If you are interested in learning more about how Conduent can help Medicaid programs with ICD-10 updates, contact Genia Kelley at

For other information about how we can assist Medicaid programs, contact Andrew Townsend at


You can read more Conduent insights about Medicaid payment in previous editions of Medicaid Payment Perspectives.