Chapter 20
Diagnosis Coding

20.1 Overview

The 1988 Medicare Catastrophic Coverage Act required physicians to report medical diagnosis codes on each Medicare payment request. Beginning April 1, 1989, the Health Care Financing Administration required the International Classification of Diseases, Ninth Revision, Clinical Modification (ICD-9-CM) codes to be reported on all Medicare claims. Additionally, diagnostic coding is to be coded at the highest level of specificity for the encounter to reflect symptoms, signs, abnormal test results or other reasons for the service billed.

20.2 Who is Required to Use ICD-9-CM?

All physicians are required to report ICD-9-CM diagnosis codes. Physicians included in this mandate are:

Doctors of Medicine

Doctors of Osteopathy

Doctors of Dental Surgery

Doctors of Dental Medicine

Doctors of Podiatry

Doctors of Optometry

Doctors of Chiropractic

Effective January 1, 1998, non-physician practitioners are required to report ICD-9-CM diagnosis codes. Non-physicians include:

Some non-physician providers are exempt from having to report ICD-9-CM codes. However, it is always advisable to report ICD-9-CM codes whenever possible as it reduces the need for correspondence requiring additional information. Because payments are driven by a uniform coding system, ICD-9-CM coding helps eliminate incorrect payments and providers will experience fewer denials on valid claims. Examples of providers exempt from having to report ICD-9-CM diagnosis codes include:

20.3 Other Coding Systems

The morphology of Neoplasms "M" codes appearing in Appendix A of Volume 1 is the World Health Organization's adaptation of the International Classification of Diseases for Oncology (ICD-O). These codes are not acceptable for Medicare. Neoplasms should be coded according to the appropriate ICD-9-CM code in the Neoplasms Table in Volume 2.

DSM-IV-R codes for psychiatric illnesses cannot be reported for Medicare purposes either. Because DSM-IV-R is not collapsible into ICD-9-CM for all codes, and is not compatible with existing carrier systems, DSM-IV-R codes are not acceptable for payment and reporting purposes.

"E" diagnosis codes will not establish medical necessity with the Medicare program and therefore, should not be used.

20.4 How ICD-9-CM is Set Up

ICD-9-CM is based on a system originally developed by the World Health Organization to classify morbidity and mortality for statistical purposes, to index hospital records and operations, and to store and retrieve data. The full ICD-9-CM system consists of three volumes. For Medicare purposes, physicians should only use the first two volumes. Volume One contains a tabular listing of diseases primarily defined by body system. Volume Two contains an alphabetical index of diseases, conditions, and diagnostic terms used in referencing the tabular listings. The third volume of ICD-9-CM contains procedure codes and is not to be used. Physicians should continue to report the procedures using Physicians' Current Procedural Terminology (CPT).

The portion of ICD-9-CM to be used by physicians consists of codes within two general ranges:

For information about the use of certain abbreviations, punctuation, symbols, and other conventions used in the ICD-9-CM Tabular List (Volume 1), see the sections on Conventions Used in the Tabular List and guidance in the use of ICD-9-CM at the beginning of Volume 1. Information about the correct sequence to use in finding a code is described in the Introduction to Volume 2, Diseases: Alphabetic Index. The most critical rule involves beginning the search for the correct code assignment through the index, Volume 2. One should never begin searching initially in the Tabular list (Volume 1) as this will lead to coding errors.

In selecting codes to describe the reason for the encounter, the physician will frequently be using codes 001.0 through 999.9. These codes are from the section of ICD-9-CM for the classification of diseases and injuries (e.g. infectious and parasitic diseases; neoplasms; symptoms, signs, and ill-defined conditions, etc.). Codes that describe symptoms and signs, as opposed to diagnoses, are acceptable for reporting purposes if this is the highest level of certainty documented by the physician. Chapter 16 of ICD-9-CM Symptoms, Signs, and Ill-defined Conditions (codes 780.0 - 799.9) contains many, but not all codes for symptoms. However, ICD-9-CM also provides codes to deal with encounters for circumstances other than a disease or injury. Please see section 20.4c for a discussion of reporting V codes.

a. Guidelines for Coding

ICD-9-CM codes contained in the two volume set are designed to be used together. Diagnosis coding is a three step process:

First, review the medical record to extract the pertinent written descriptions of the disease or symptoms.

Next, look up the disease, signs and symptoms, or condition in Volume 2, Diseases Alphabetic Index, and locate the corresponding code.

Finally, look up the corresponding code in Volume 1, Diseases Tabular List and choose the most specific code that accurately describes the patient's condition.

Because Volume 2 contains many diagnostic terms not used in Volume 1 and Volume 1 uses more descriptive terms, it is important to use both books when finding the most accurate code. In general, it is best not to code directly from the alphabetic index.

b. Highest Degree of Specificity

Codes must be used at their highest level of specificity, for example:

ICD-9-CM is composed of codes with either 3, 4, or 5 digits. Codes with 3 digits are included in ICD-9-CM as stand alone codes or as the heading of a category of codes that are further subdivided by the use of fourth or fifth digits which provide greater specificity.

Examples:

c. Reporting V Codes

The Supplementary Classification of Factors Influencing Health Status and Contact with Health Services (V01.0 - V82.9) is provided to deal with occasions when circumstances other than a disease or injury are recorded as diagnoses or problems. For patients who receive only ancillary diagnostic services during an encounter, first report the diagnosis, symptoms or signs for which the services are being performed. Report the appropriate V code for the examination second. Usually V codes should only be reported as a supplementary code and should not be reported as the primary reason or the only reason for the encounter. Diagnostic tests can be reported with a routine diagnosis code (V70.0-V70.9 and V72.0-V72.9). However, when the only diagnosis reported on the claim is one of the previously listed ICD-9 codes, the service will be denied as a routine service. V codes will be used frequently by radiologists and pathologists. The following examples will assist in reporting V codes:

A physician refers a specimen to a pathologist to perform a biopsy. If at the time the claim is submitted, there is an established diagnosis (e.g., malignant neoplasm - 195.3), this diagnosis code should be reported first to describe the reason for the service. The diagnosis code V72.6, laboratory examination, should be reported as a secondary code. If the diagnosis has not been established, the pathologist should report at least one of the signs or symptoms.

20.5 Trauma Diagnoses and MSP

The Medicare Secondary Payer (MSP) department is responsible for contacting the billing physician to obtain clarification on Medicare claims with certain trauma related ICD-9-CM codes reported for determination of other primary liability. Lack of primary insurance information can trigger development particularly if the treatment is related to a work injury, auto accident, or other type of accident. Please be sure to complete primary insurance information thoroughly.

20.6 Diagnosis Claims Linkage

Physicians may report a maximum of four unique diagnosis codes per claim when billing for their services. In addition, for each line of service, the physician must indicate which one of the reported diagnosis codes relates to the service(s) reported on that line (diagnosis code pointer). Do not correlate more than one diagnosis code per line of service. Of the diagnosis codes reported, the physician must select only the primary diagnosis which best describes the reason for the procedure.

Any line of service reported on an assigned claim which is not correlated to a primary diagnosis code will be rejected. Nonassigned claims will be delayed pending contact with the billing physician to obtain clarification.

In instances where the patient has more than four conditions present at the time of treatment, the primary diagnosis code that is chiefly responsible for the services reported on the claim is to be listed in the first position. In selecting the other three diagnosis codes, those conditions for which the procedure codes are listed and to which the procedures were directed should be reported. Procedures which cannot be related to any of the four diagnoses must be reported on a separate claim with the appropriate diagnosis.

a. Diagnosis Code

 
ANSI ASC X12 837
VERSION 30.32
ANSI ASC X12 837
VERSION 30.51
NATIONAL
STANDARD FORMAT
VERSIONS 00200, 00104
#1
2-235.A
CD2 SEGMENT
03 DATA ELEMENT
#1
2-231
HI SEGMENT
01 DATA ELEMENT
-02 SUB ELEMENT
#1
EA0 RECORD

POSITIONS 179-183
#2
2-235.A
CD2 SEGMENT
04 DATA ELEMENT
#2
2-231
HI SEGMENT
02 DATA ELEMENT
-02 SUB ELEMENT
#2
EA0 RECORD

POSITIONS 184-188
#3
2-235.A
CD2 SEGMENT
05 DATA ELEMENT
#3
2-231
HI SEGMENT
03 DATA ELEMENT
-02 SUB ELEMENT
#3
EA0 RECORD

POSITIONS 189-193
#4
2-235.A
CD2 SEGMENT
06 DATA ELEMENT
#4
2-231
HI SEGMENT
04 DATA ELEMENT
-02 SUB ELEMENT
#4
EA0 RECORD

POSITIONS 194-198

b. Diagnosis Code Pointer

 
ANSI ASC X12 837
VERSION 30.32
ANSI ASC X12 837
VERSION 30.51
NATIONAL
STANDARD FORMAT
VERSIONS 00200, 00104
#1
2-290
SV1 SEGMENT
08 DATA ELEMENT



2-325
SV6 SEGMENT
06 DATA ELEMENT
#1
2-370
SV1 SEGMENT
07 DATA ELEMENT
-01 SUB ELEMENT


2-405
SV6 SEGMENT
05 DATA ELEMENT
-01 SUB ELEMENT
#1
FA0 RECORD

POSITIONS 78
Valid Value: 1
#2
2-290
SV1 SEGMENT
10 DATA ELEMENT



2-325
SV6 SEGMENT
09 DATA ELEMENT
#2
2-370
SV1 SEGMENT
07 DATA ELEMENT
-02 SUB ELEMENT


2-405
SV6 SEGMENT
05 DATA ELEMENT
-02 SUB ELEMENT
#2
FA0 RECORD

POSITION 79
Valid Value: 2
#3
2-335.A
CD2 SEGMENT
03 DATA ELEMENT
#3
2-370
SV1 SEGMENT
07 DATA ELEMENT
-03 SUB ELEMENT


2-405
SV6 SEGMENT
05 DATA ELEMENT
-03 SUB ELEMENT
#3
FA0 RECORD

POSITION 80
Valid Value: 3
#4
2-335.A
CD2 SEGMENT
04 DATA ELEMENT
#4
2-370
SV1 SEGMENT
07 DATA ELEMENT
-04 SUB ELEMENT


2-405
SV6 SEGMENT
05 DATA ELEMENT
-04 SUB ELEMENT
#4
FA0 RECORD

POSITION 81
Valid Value: 4

c. Paper Claims

Report the ICD-9-CM codes (maximum of four) in block 21 of the HCFA-1500 (12-90) claim form. The diagnosis must be correlated by the reference number (i.e., 1, 2, 3, or 4) in block 24E under the column labeled "Diagnosis Code". Enter only one reference number per line item. Do not report individual diagnosis codes in block 24E. Services which are not correlated to one of the four diagnosis codes in block 21 will be rejected.

20.7 Commonly Asked Questions

Listed within this section are frequently asked questions regarding diagnosis coding.

Q. How can I obtain the most current ICD-9-CM?

A. The Government Printing Office offers the ICD-9 Coding Book on CD ROM. You may also continue to purchase a paper version of the ICD-9 Coding by contacting Practice Management Information Corporation (PMIC).

a.1 CD ROM

Superintendent of Documents
U.S. Government Printing Office
P.O. Box 371954
Pittsburgh, PA 15250
Phone: (202) 512-1800
FAX: (202) 512-2250

a.2 Paper Version

Practice Management Information Corporation (PMIC)
4727 Wilshire Blvd.
Los Angeles, CA 90010
Phone: (800) 633-4215

Note: If you have any questions or comments regarding the ICD-9 coding book that you may have purchased from PMIC, you should contact them directly at the telephone number listed above.

Q. If I should not code using a `rule out' diagnosis, what code should I use?

A. Providers should not code a disease or condition unless there is a definitive diagnosis. If tests are performed to rule out a diagnosis and the diagnosis is not established when the claim is submitted, you should only code the chief complaint or signs and symptoms related to the `rule out' or `possible' diagnosis.

Q. If there are more than four relevant diagnoses, which ones should I choose?

A. Due to space limitations, you may only code four diagnoses, conditions, or signs and symptoms. If the patient has more than four, choose the four that best describe the reason for the encounter and are directly related to the service provided.