MedicaidReimbursementMedium impact
Initiative 1: Increase Reimbursement by 20 Percent for Physical Health Services Delivered in Office of Addiction Services and Supports Outpatient Clinics
NY Medicaid·NY · Psychiatry, Family Medicine, Internal Medicine +3 more·Claims & Billing
Effective date
Jul 1, 2026
We identified it
Sep 17, 2026
Summary
NYS Medicaid implements a 20% reimbursement rate enhancement effective July 1, 2026 for physical health E&M services (CPT codes that group to Medical Visit APG E&M 491) delivered in OASAS-certified addiction treatment clinics and OTPs. Providers must append P1, P2, or P3 modifiers based on patient health status to qualify for the enhancement; medication management and psychiatric E&Ms must use HE or HF modifiers instead and do not receive the enhancement. The policy also includes updates on denture billing coordination of benefits at FQHCs, HPV testing coverage with specific CPT codes, and removal of prior approval requirements for lung cancer screening (CPT 71271).
Action Required
By June 30, 2026: (1) Billing and clinical teams at OASAS-certified addiction medicine clinics and OTPs must update billing system configuration to apply 20% rate enhancement to E&M codes that group to Medical Visit APG 491. (2) Train providers to append P1 modifier (healthy patients), P2 modifier (minor systemic disease), or P3 modifier (severe systemic disease) to qualifying physical health E&M line items; append HE modifier (mental health service) or HF modifier (substance use disorder service) to medication management and psychiatric E&Ms instead. (3) For FQHC denture billing: Update claim submission workflow to bill CDT codes D5110, D5120, D5211, D5212, D5213, D5214, D5225, D5226 to primary/commercial insurance first, then calculate pro-rated amount per visit and submit secondary claim to NYS Medicaid for difference. (4) Effective immediately: Remove prior authorization requirements for CPT 71271 (lung cancer screening) from billing system rules; claims no longer need pre-approval. (5) Update system to recognize CPT 87623, 87624, 87625, 87626 for HPV testing billed by clinical laboratories; ensure E&M services can be billed separately when medically necessary. Failure to apply modifiers will result in claims paying at standard rate without the 20% enhancement.