Special Alert May 2026 - UPDATE Alert for 6.1 and 7.1 Coding and Reimbursement Policy Changes

REQUIREMENTS: 1. By June 1, 2026: Billing team must update commercial anesthesia billing to remove payment for physical status modifiers P3, P4, and P5. These modifiers may still be reported for documentation but will generate zero additional reimbursement. Update billing software rules and provider payment documentation to reflect this change. 2. By July 1, 2026: Billing team must implement automated edits to deny or flag inpatient facility claims billed with MS-DRG 871 or 872 when length of stay is less than 3 days AND discharge disposition is to home. Providers must review physician documentation to ensure sepsis severity and resource intensity justify these high-severity DRGs before billing; consider rebilling under more appropriate DRGs if criteria not met. Update EMR templates to prompt for clinical documentation supporting DRG assignment. 3. By July 1, 2026: Billing and coding staff must implement system edits to deny line-level facility ED claims when CPT 99291 or 99292 (critical care codes) are billed AND discharge disposition is to home. Review ED protocols with providers—critical care services should only be billed when clinical severity supports it; discharge to home generally contradicts critical care necessity. Update ED encounter forms to include discharge disposition flags. Note: This applies to facility billing only; ED visits resulting in inpatient admission are exempt. 4. By July 1, 2026: Billing team must implement automated edits to deny surgical procedure lines when required anatomical modifiers (RT, LT, E1-E4, F1-F9, T1-T9, LC, RC) are missing, incorrect, or inappropriately substituted with non-specific modifiers (59, XS). Providers and coders must verify all bilateral-eligible CPT codes 10000-69999 include correct anatomical modifiers before submission. Update billing software to reject claims with modifier 59 or XS when a more specific anatomical modifier is available. Train billing staff and providers on proper anatomical modifier requirements. CONSEQUENCES: Non-compliance will result in claim denials, payment delays, and potential payment clawbacks for previously submitted claims.