Medicare AdvantageBilling CodesHigh impact
Special Alert May 2026 - UPDATE Alert for 6.1 and 7.1 Coding and Reimbursement Policy Changes
Providence Health Plan·Anesthesiology, Emergency Medicine, Critical Care +1 more·Coding
Effective date
Jun 1, 2026
We identified it
May 1, 2026
Summary
Providence Health Plan implemented four coding and reimbursement policy changes effective June-July 2026: (1) Denying inpatient sepsis claims (MS-DRG 871-872) with length of stay under 3 days discharged to home; (2) Denying critical care services (CPT 99291-99292) billed in the ED when discharged to home; (3) Requiring anatomical modifiers (RT, LT, etc.) on surgical procedures or claims will be denied; (4) Eliminating additional reimbursement for anesthesia physical status modifiers P3, P4, P5 on commercial plans. These changes require immediate billing system updates and provider communication to avoid claim denials.
Action Required
REQUIREMENTS:
By May 15, 2026: (1) Billing team must update system edits to automatically deny claims with MS-DRG 871 or 872 when length of stay is less than 3 days AND discharge disposition is to home. (2) Configure system to deny CPT 99291/99292 at line level when billed in emergency department with discharge to home (status code 01). (3) Update billing rules to require anatomical modifiers (RT, LT, E1-E4, F1-F9, T1-T9, LC, RC) on all CPT codes 10000-69999 that are bilateral-eligible; deny claims with missing, incorrect, or non-specific modifiers (59, XS) when specific anatomical modifiers apply. (4) For commercial anesthesia claims, remove reimbursement for additional units associated with physical status modifiers P3, P4, P5 effective June 1, 2026; modifiers may still be reported for documentation only.
By June 15, 2026: (1) Communicate policy changes to all providers, clinical staff, and coders. (2) Provide education on MS-DRG 871-872 clinical severity and documentation requirements to support claims with appropriate length of stay. (3) Train anesthesia providers and coders that P3, P4, P5 modifiers will no longer generate additional payment on commercial plans. (4) Update encounter forms and documentation templates to remind providers of anatomical modifier requirements on surgical procedures.
Immediate ongoing actions: (1) Review and rebill denied inpatient sepsis claims under more appropriate DRGs if clinical severity does not support 871-872. (2) Monitor claims for anatomical modifier compliance and coordinate with surgical teams on proper modifier application. (3) Audit anesthesia billing for commercial plans to ensure P3, P4, P5 modifier units are not being submitted for reimbursement. Failure to comply will result in automatic claim denials and payment delays.