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The National Correct Coding Initiative in Medicaid

The CMS National Correct Coding Initiative (NCCI) promotes national correct coding methodologies and reduces improper coding which may result in inappropriate payments of Medicare Part B claims and Medicaid claims.  For information about, and edits for, the Medicare NCCI program, please visit http://www.cms.gov/Medicare/Coding/NationalCorrectCodInitEd/index.html.  The Medicaid NCCI program has significant differences from the Medicare NCCI program.

The Affordable Care Act of 2010 required CMS to notify states by September 1, 2010, of the NCCI methodologies that were compatible with Medicaid.  State Medicaid Director Letter #10-017 notified states that all five Medicare NCCI methodologies were compatible with Medicaid.  The Affordable Care Act required state Medicaid programs to incorporate compatible NCCI methodologies in their systems for processing Medicaid claims by October 1, 2010.

Updated information on CMS requirements for implementation of the NCCI methodologies in state Medicaid programs is contained in the CMCS Informational Bulletin of January 30, 2012, and the Medicaid NCCI Fact Sheet.

Types of NCCI Edits

The National Correct Coding Initiative (NCCI) contains two types of edits:

  1. NCCI procedure-to-procedure (PTP) edits that define pairs of Healthcare Common Procedure Coding System (HCPCS) / Current Procedural Terminology (CPT) codes that should not be reported together for a variety of reasons.  The purpose of the PTP edits is to prevent improper payments when incorrect code combinations are reported.
  2. Medically Unlikely Edits (MUEs) define for each HCPCS / CPT code the maximum units of service (UOS) that a provider would report under most circumstances for a single beneficiary on a single date of service.

The NCCI Methodologies in Medicaid

The Medicaid NCCI program consists of six methodologies.  These are:

  1. A methodology with PTP edits for practitioner and ambulatory surgical center (ASC) services.
  2. A methodology with PTP edits for outpatient hospital services (including emergency department, observation, and hospital laboratory services).
  3. A methodology with PTP edits for durable medical equipment.
  4. A methodology with MUEs for practitioner and ASC services.
  5. A methodology with MUEs for outpatient hospital services for hospitals.
  6. A methodology with MUEs for durable medical equipment.

The Medicaid NCCI methodologies apply only to Medicaid fee-for-service claims that are reimbursed on the basis of HCPCS / CPT codes.

Components of the NCCI Methodologies in Medicaid

Each of the Medicaid NCCI methodologies has four components.  These are:

  1. a set of edits;
  2. definitions of types of claims subject to the edits;
  3. a set of claim adjudication rules for applying the edits; and
  4. a set of rules for addressing provider appeals of denied payments for services based on the edits.

Information on claim adjudication rules for applying the Medicaid NCCI methodologies in state processing of Medicaid claims, the third component of the Medicaid NCCI methodologies, is contained in the Medicaid NCCI Edit Design Manual (see "Medicaid NCCI Reference Documents" below).

State Medicaid Director Letter #11-003 states CMS policy on provider appeals of payments of Medicaid claims denied due to the Medicaid NCCI edits, the fourth component of the Medicaid NCCI methodologies.

Medicaid NCCI Edit Files

The complete updated Medicaid NCCI edit files are posted here at the beginning of each calendar quarter.  These files completely replace the Medicaid NCCI edit files from previous calendar quarters.  The presence of a HCPCS / CPT code in a PTP edit or of an MUE value for a HCPCS / CPT code does not necessarily indicate that the code is covered by any state Medicaid program or by all state Medicaid programs.  States cannot use the files here for processing and paying Medicaid claims.

The complete Medicaid NCCI edit files for the current calendar quarter can be accessed by clicking on the links below:

PTP edits for practitioner and ambulatory surgical center (ASC) services

PTP edits for outpatient services in hospitals (including emergency department, observation, and hospital laboratory services)

PTP edits for provider claims for durable medical equipment

MUEs for practitioner and ASC services

MUEs for outpatient services in hospitals

MUEs for provider claims for durable medical equipment

To access the files containing only the changes made in the Medicaid NCCI edit files for the current calendar quarter, the Medicaid NCCI Change Reports, click here. Information on these files is contained in Change Report File Information.

NOTICE:  The MUE files for the third quarter of 2014 have been updated with the addition of a new field on the rationale for each MUE.  Please refer to the NCCI Policy Manual for Medicare Services (http://www.cms.gov/Medicare/Coding/NationalCorrectCodInitEd/index.html) for explanations of the MUE rationales.

Medicaid NCCI Reference Documents

Medicaid NCCI Edit Design Manual (rev. 3/14)

Medicaid NCCI Policy Manual (rev.11/14)

Medicaid NCCI Correspondence Language Manual (rev. 3/14)

Medicaid NCCI FAQs Update (rev. 11/14)

Modifier 59 Article (rev, 10/14)

Report to Congress on Implementation of the NCCI in the Medicaid Program (3/11)

NCCI Contact Information

This webpage provides information to states, providers, and other interested parties regarding implementation of the NCCI methodologies in the Medicaid program.  Concerns about specific NCCI edits may be submitted in writing to the CMS NCCI technical contractor at:

Medicaid National Correct Coding Initiative
Correct Coding Solutions, LLC
PO Box 907
Carmel, IN 46082-0907
Fax:  317-571-1745