How is Your Medical Practice Coping with Thousands of New Codes?

Initial reports are that ICD-10 has come into full effect this October without much of a storm…that is for big hospitals and practices. With 69,000 codes and changes in structure, the ICD-10 updates are sure to cause some disruptions.

Top 4 questions being asked by practice managers related to ICD-10:

  1. How do we use the placeholder X? How to use the initial, ongoing and sequel visits and coding/use of seventh character.

New ICD-10 codes range from three to seven characters in length (due to ICD-10 codes using both letters and numbers the term characters is now more commonly used rather than the term ‘digits.’) Thus, because ICD-10 codes sets use a placeholder ‘X’  and also allow for ‘qualifiers’ this has led many to ask about the purpose or appropriate use of how these are both assigned appropriately.

First, ICD-10 CM utilizes a dummy placeholder, which is always an “x” when a code has less than six characters and a seventh character extension is required, this is where the placeholder X comes to play. The “x” is assigned for all characters less than six in order to meet the requirement of coding to the highest level of specificity. For example:  to report a contusion of right hip, the code is S70.01 – however, these 5 characters are not a valid code alone and requires a 7th digit to identify the type of encounter. Since this was an initial encounter or the first time the patient was see for this injury, the 7th character of ‘A’ is needed. Therefore the valid code to submit for this encounter is S70.01XA. The “X” is needed because the base code was only 5 characters.

An additional example is W85. – is described as ‘Exposure to electric transmission lines.’ However, the ICD-10 guidelines again require the assignment of the 7th character extension. Because W85 is not a valid code, to comply with these ICD-10 guidelines, the dummy placeholder must be added to meet these requirements. Thus, W85.XXXA is the appropriate code in this circumstance to describe a patient being seen for Exposure to an electric transmission line for the first time or as the – initial encounter.

Additional examples of utilizing the ‘X’ as a dummy place holder:

  • xxxA – Exposure to electric transmission lines, initial encounter
  • 0XXA – Crushing injury of larynx and trachea, initial encounter
  • 02XA – Laceration with foreign body of scalp, initial encounter

To further explain what is meant by the 7th character extensions please refer to the following:

  • Initial encounter: Indicated by an ‘A’ as the 7th character
    • The letter ‘A’ is used while the patient is receiving active treatment for the injury, initially or the first time.
    • Example: T22.111A: Burn of first degree of right forearm, First or Initial encounter
  • Subsequent encounter: Indicated by the letter ‘D’
    • The letter ‘D’ is used for encounter after the patient has received active, or the initial, treatment of the injury and is receiving routine care for the injury during the healing or recovery phase.
    • Example: T22.111D: Burn of first degree of right forearm, Subsequent encounter
  • Sequela: Indicated by the letter ‘S’ as the 7th character
    • The letter ‘S’ is used for complication or condition called the sequela. It is defined as a “late effect or the residual effect after the acute phase of an illness or injury has ended that arise as a direct result of an injury.” Such as scar formation after a burn. The scars are a sequela of the burn
    • Example; T22.111S : Burn of first degree of right forearm, Sequela
  1. How do we code Evaluation and Management (E/M) visits?

The CMS provides this statement about the responsibility of billing and coding lying in the hands ultimately of the provider, explaining that “when billing for a patient’s visit, select codes that best represent the services furnished during the visit.

The CPT Coding manual further states, “The E/M (Evaluation and Management) section is divided into broad categories such as office visits, hospital visits, and consultations. Most of the categories are further divided into two or more subcategories of E/M services. For example there are two subcategories of office visits – – new versus established – – and two subcategories of hospital visits – -initial and subsequent – – to chose from.  This classification is important because the nature of work varies by type of service, place of service, and patient status” (CPT 2015).

For example, office or other outpatient visits are divided  into a range of codes 99201 -99205 for New Patient’s requiring all of the three noted key components listed in each of these categories must be present in order to assign the correct E/M code. On the other hand, the range of codes for an Established patient is 99211 to 99215 but in this range of codes 2 of the three key components must be identified.

Furthermore, for New or Established office or outpatient visits these codes may also be assigned on a time based factor if appropriately identified in the provider documentation. For example, a new patient is visiting a provider and the medical record indicates ‘Typically, 30 minutes are spent face-to-face with the patient and/or family’ allowing E/M code of 99203 to be assigned according to coding guidelines.

A billing specialist or alternate source may review the provider’s documented services before the claim is submitted to a payer. These reviewers may assist with selecting codes that best reflect the provider’s furnished services. However, it is the provider’s responsibility to ensure that the submitted claim accurately reflects the services provided.”

Also, Provider’s, Coders/Billers need to be mindful of payer specific guidelines when assigning the correct E/M codes. For example, note that Medicare has indicated that it will NOT pay for Advance Care Planning codes 99497 (Advanced Care Planning; first 30 minutes) or 99498 (Advanced Care Planning; each additional 30 minutes) in 2015 (Medical Economics).  Check with your commercial payers to see if they are reimbursing for these codes. For the most updated CMS released document, Evaluation and Management Services Guide, click here.

  1. Why are we experiencing denials for Z codes?

There is a list in some of the ICD-10 manuals which state what Z codes can be listed as primary diagnosis (es) only. Is your healthcare facility or practice using something other than what is on this list? Is the order of listed codes correct?

 Z codes in ICD 10 are generally considered to be the replacement of V codes, although simply replacing the V57 series of codes from ICD-9 over to ICD-10 is not always possible. Z codes are known as “Factors influencing health status and contact with health services” ranging from Z00-Z99 in ICD-10. This includes Z47.- Orthopedic aftercare visit codes; refer to situations in which initial treatment of a disease has been performed and the patient is returning for a follow up visit. For example, if a patient is seen as a result of a fracture the patient first requires care for the initial injury to identify which bone was fractured with the appropriate character of “A” added for the initial encounter.  Then for the healing or recovery phase the ‘Z47’ set of codes may be appropriate (ICD-10).  Some medical practices receive denials for Z codes because they are not following the correct diagnosis code for the different type of encounters.

Again, do not use the aftercare Z codes if treatment is directed at a current, acute disease as stated above. Instead you would assign the acute injury code with the appropriate 7th character, which you can find in ICD-10-CM Official Guidelines for Coding and Reporting FY 2015.

If you are experiencing a high number of denials or any denial you should check with your payers to learn their requirements on the use of assigning the code for the initial visit and the use of aftercare or other codes.

  1. How to use injury dates and activity ICD-10 code sets.

First, when completing a CMS-1500 claim form verify with each of your third-party payers if the injury dates are required. If so, according to the payer discretion the dates of injury can be entered on Block 14 and/or Block 15 of the CMS 1500 Claim form.

Next, when referring to activity codes these were assigned as E-codes located in the Index to External Causes. To find the appropriate activity codes for ICD-10 refer to the “Alphabetic Index to External Causes of Injury and Poisoning” External cause of Injury coding under the term ‘Activity.’ For example, was the patient playing golf, knitting, or for food preparation and clean-up?

Contact us:

Are these the same issues that you are struggling with? At UPS, we have the staff to assist you, whether it is training, talent acquisition, revenue decline or general questions.

We want to ensure you have all the resources you need for running your medical practice with as few hiccups as possible. We know that the ICD-10 transition looks different for every practice. Do you have a specific question not addressed here?

Contact us today at United Physicians Healthcare to discuss how we can help your business grow or how to overcoming any ICD-10 obstacles your current health care business is facing. Rochelle Glassman, or our expert iCD-10 Trainer, is on hand to extend the conversation.


American Medical Association. (2015). Evaluation and Management. In Professional Edition, CPT Current Procedural Terminology (2015 ed.). Chicago, IL: Author.

ICD-10-CM Official Guidelines for Coding and Reporting FY 2015

Medical Economics, & Dowling, R. (2015, January 7). Coding changes for 2015: New evaluation and management codes explained | Medical Economics. Retrieved November 8, 2015, from