Pathology/Lab Coding Alert

CMS scraps the 90-day grace period

You used to have until April 1 to work out the bugs in reporting new CPT Codes to Medicare - but not any more. Now you'll need to use those new codes as soon as they become valid on Jan. 1.

Why the Rush?

Blame it on HIPAA (the Health Insurance Portability and Accountability Act). That's why Medicare had to repeal the 90-day grace period it used to offer you to implement any new code sets - whether ICD-9 diagnosis codes or HCPCS Level II and CPT procedure codes.

HIPAA's "transaction and code set rule requires usage of the medical code set that is valid at the time that the service is provided," CMS says. "Therefore, CMS is eliminating the 90-day grace period for billing discontinued HCPCS Level II and CPT codes effective Jan. 1, 2005."

Get Used to It

You could be facing twice-yearly updates with no grace periods from now on. The American Medical Association now releases temporary Category III codes in January and July, with implementation dates six months later. So your practice should already be using the new Category III codes that took effect July 1, says consultant Mary LeGrand with Karen Zupko & Associates in Chicago.

"In prior years, the AMA said, 'You can start using [new codes] as soon as we release them,' but [providers] had additional leeway until CPT books were published in January," LeGrand says.

Don't forget that CMS now updates HCPCS Level II codes quarterly, and you'll need to keep current on those code changes too.