Traditional MedicareBilling CodesMedium impact
2026-08-27 - Alabama: $144M to Improve Mental Health, Substance Abuse, Emergency, and Maternal Care & Expand the Health Care Workforce
Medicare/CMS·AL, AK, ND, OH, PA, SD, WV · Dermatology·General
Effective date
Oct 1, 2026
We identified it
Aug 27, 2026
Summary
This MLN Connects Newsletter (August 27, 2026) contains multiple policy updates effective October 1, 2026 and January 1, 2027, including: (1) Dermatology E/M billing clarification requiring modifier 25 documentation for separately identifiable services; (2) Clinical laboratory fee schedule and HCPCS code updates; (3) Home Health PPS Grouper software update; (4) Hospice payment rate changes for FY 2027; and (5) ICD-10 coding revisions. Additionally, it announces Rural Health Transformation Program funding across multiple states.
Action Required
REQUIREMENTS: By September 15, 2026: (1) Billing team must review dermatology E/M billing practices and ensure modifier 25 is applied only when a significant, separately identifiable E/M service is documented and unrelated to the decision to perform the minor surgical procedure. Update billing software rules to flag claims lacking proper 25 modifier documentation. (2) Update Home Health Prospective Payment System Grouper to Version 07.2.26 (released October 2026). (3) By September 30, 2026: Clinical laboratory staff must review updated Clinical Laboratory Fee Schedule effective October 1, 2026, including new/deleted CPT codes and waived test updates (see CMS MLN Matters article for specifics). (4) Hospice billing staff must implement FY 2027 payment rate changes, inpatient aggregate cap adjustments, and wage index updates effective October 1, 2026. (5) By December 15, 2026: Coding team must prepare for ICD-10 and National Coverage Determination coding revisions effective January 1, 2027 (see MLN Matters 2 of 2 update for specifics). Providers must maintain detailed medical record documentation to support E/M service levels and separately identifiable services. Dermatology claims lacking proper modifier 25 documentation or billing E/M services included in global surgery rules will be denied.