Laterality in clinical documentation: Understanding ICD-10-CM’s new unspecified rule

We spoke with coding professional June Bronnert, MHI, RHIA, CCS, CCS-P to understand the new unspecified rule and how it impacts clinical documentation.
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On October 1, 2021, a new code edit from the Centers for Medicare & Medicaid Services (CMS) went into effect. This new code edit focuses on acute care hospital inpatients and asks providers to capture additional specificity in ICD-10-CM related to laterality codes. While this change may seem small, it is important that facilities work with clinicians to ensure that laterality is captured upfront within the routine clinical workflow – not later, after a claim has already been denied because a more specific code wasn’t used.   

Which way is right? Or left?

To better understand the unspecified rule, we first need to think within the framework of ICD-9-CM. This coding system did not lend itself to documenting laterality – meaning, if a patient came in with a fractured wrist it would be documented as “unspecified fracture of unspecified wrist and hand.”

Now, using ICD-10-CM, clinicians have code descriptors for laterality. The unspecified rule edit will help capture the granularity that is within the code system and create data that more accurately reflects the clinical reality. So, the code selected for a patient with a fractured wrist will now receive a Medicare code edit signal that a more specific laterality code is available: “unspecified fracture of left wrist and hand.”

How the unspecified rule impacts reimbursements

When an inpatient claim is submitted with an unspecified laterality code when specified laterality codes are available, the claim could be denied and sent back to the facility with edits. This, in turn, can impact an organization’s financial return and create clinical workflow challenges.

When claims are denied and sent back to the facility, it delays appropriate payments that impact reimbursement. Furthermore, a denied claim stemming from an inaccurate code can lead to more work for clinical staff who now must work through the denied claims list and track down the additional laterality information needed to resubmit the claim.

Analyze the impact of the unspecified rule

Organizations can run an analysis of how often their clinical documentation contains unspecified laterality leading to the assignment of unspecified codes that have sub-categories for laterality. For example, if a facility examines all wrist fractures documented within the last year, how many of those injuries are coded with laterality and how many are not? Taking a closer look at this data will establish a baseline for the capture of this detail and reveal where there is room for improvement.

Specificity is the best policy

When it comes to these types of Medicare code edits, ones that raise the bar for capturing specificity within coding systems, the unspecified rule regarding laterality is just the beginning. Ultimately, this edit is the first step toward balancing and optimizing how administrative code systems and clinical documentation work together – and those of us who work in this space should expect similar changes in the future.

The unspecified rule edit was part of the annual updates to Medicare’s Inpatient Prospective Payment System which also contained ICD-10-CM code updates. To learn more about the latest code changes, watch our on-demand webinar: ICD-10-CM 2022 updates and regulatory readiness.
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