Medicaid Adopts NCCI

African American man using walker with dog
Terry Vine/Getty Images

Initially, NCCI or the National Correct Coding Initiative was developed by CMS for Medicare B claims and is now being implemented for state Medicaid programs.

Effective for dates of service beginning October 1, 2010, all state Medicaid programs were required by the ​Affordable Care Act of 2010 to incorporate the NCCI program into their claims processing system. All states had until March 31, 2011 to comply.

NCCI is a program developed by CMS for the purpose of preventing overpayments to providers due to incorrect code combination or units of service on the same date of service by the same provider in excess of what is normally considered to be medically necessary.

The current NCCI mandate consists of two types of coding edits.

  1. Procedure to Procedure Edits: These edits define HCPCS and CPT codes that should not be billed in combination with one another. If these codes are billed together one or both may be denied.

    In some instances, the appropriate modifier can be added to identify those services or procedures that are eligible for payment.

  2. Medically Unlikely Edits (MUEs): These edits define HCPCS and CPT codes with a certain number of units that are unlikely to be billed if the claim is correct. In some instances, the units of service will be denied that exceed what is considered to be medically necessary.

    For other units of service, the claim can be paid by adding appropriate modifiers.

    This was just the beginning phase in the NCCI implementation process. By January 1, 2011, more changes were implemented to include edits more specific to the Medicaid program.

    Specific details regarding Medicaid NCCI Coding can be found at the Centers for Medicare and Medicaid Services website. CMS provides a Medicaid NCCI Coding Policy Manual and complete lists of edits by provider type.