Currentpriority healthPolicy 076

ICD-10-CM Excludes1 coding guidance

Defines Priority Health's guidance on ICD-10-CM Excludes1 notes, documentation expectations, and applicability to commercial, Medicare and Medicaid lines of business. Affects providers submitting diagnosis coding with Priority Health members.

Policy Summary

Payerpriority health

PolicyICD-10-CM Excludes1 coding guidance

Policy CodePolicy 076

Change TypeNo material change

Effective DateFeb 18, 2025

Next Review DateFeb 1, 2026

Key ActionEnsure authorizations do not supersede coding, billing, or reimbursement requirements and follow proper billing/coding to support payment.

SourceLink

POLICY UPDATE CHANGES

No material clinical or coverage changes in this revision.

3Lines of business covered

1Policy focus (Excludes1)

Feb 2026Next review

ICD-10-CMExternal refs

Documentation & Billing Expectations

Documentation and coding criteria

Documentation and billing expectations when coding diagnoses with an ICD-10-CM Excludes1 note.

Providers must maintain complete and thorough documentation to substantiate the procedures performed and diagnoses reported on claims.

Use industry-standard, compliant diagnosis and procedure codes (ICD-10-CM, CPT, HCPCS, revenue codes) reported to the highest level of specificity and supported by the medical record.

Failure to document services rendered or items supplied in the medical record will result in claim denial; documentation requirements from applicable guidelines must be followed.

Do not report codes that are designated as ICD-10-CM Excludes1 together because the two conditions cannot occur at the same time, unless the documentation shows the conditions are truly unrelated.

Policy Summary

Payerpriority health

PolicyICD-10-CM Excludes1 coding guidance

Policy CodePolicy 076

Change TypeNo material change

Effective DateFeb 18, 2025

Next Review DateFeb 1, 2026

Key ActionEnsure authorizations do not supersede coding, billing, or reimbursement requirements and follow proper billing/coding to support payment.

SourceLink

On This Page

Trek Health ingests and normalizes Transparency in Coverage data and payer policy updates to give provider organizations a clear view of how commercial reimbursement behaves across markets, payers, and services. Our platform transforms raw payer disclosures into structured intelligence that supports contract evaluation, payer negotiations, and service line strategy. By combining market benchmarks with ongoing policy visibility, Trek helps teams identify variability, risk, and opportunity in commercial reimbursement. The result is faster insight, stronger negotiating positions, and more informed financial decisions.

ICD-10-CM Excludes1 Guidance

ICD-10-CM Excludes1 guidanceICD-10

Excludes1

Indicates codes that should not be reported together because the conditions cannot occur together; mutually exclusive codes.

inv-03: Exception allowance

Policy allowanceIf two conditions are truly unrelated and both are documented by the provider, both codes may be reported despite an Excludes1 note.

Documentation requirementProvider must document clinical evidence that the conditions are unrelated to justify reporting both codes.

Scope of exceptionApplies when the unrelated conditions are present for the same service and clearly supported in the medical record.

Key Terms

inv-06: Excludes1 definition

DefinitionExcludes1 indicates diagnosis codes that should not be reported together because the two conditions cannot occur at the same time.

Mutual exclusivityAn Excludes1 note may apply to a specific code or an entire category; every code associated with that rule is considered mutually exclusive.

Coding actionDo not code two conditions together when an Excludes1 note applies unless an exception is documented per policy.

inv-07: Excludes1 example

Category-level exampleM20 (Acquired deformities of fingers and toes) has an Excludes1 note preventing reporting with codes for acquired or congenital absence and congenital deformities of fingers and toes.

Illustrative allowanceIf two conditions are truly unrelated (e.g., psychogenic dysmenorrhea and sleep-related bruxism), both F45.8 and G47.63 may be coded when documented.

Guidance on applicabilityThe example demonstrates that the Excludes1 restriction at the category level does not prohibit reporting both codes when clinical documentation shows unrelated conditions.

Authorization, Payment, and Claim Actions

Note

Authorization does not guarantee payment

An authorization is not a guarantee of payment. Providers must follow proper billing and coding requirements and ensure documentation supports the services billed. Use industry-standard codes (CPT, HCPCS, revenue codes) reported to the highest level of specificity only for services actually performed and fully documented in the medical record. Payment integrity reviews (pre- or post-claim) may be performed to validate billing and coding accuracy.

Authorization does not ensure payment — coding, billing, and documentation requirements must be met
Use CPT, HCPCS, and revenue codes to the highest level of specificity
Services must be performed and fully documented in the medical record
Payment integrity reviews may be performed pre- or post-claim

Denial Risk

Claim rejection and recoupment risk

If government program regulations, policy requirements, or contractual obligations are not followed, Priority Health may reject or deny claims or recover payments. Failure to document services rendered or to meet coding/billing requirements can result in claim denial, rejection, or recoupment of previously paid claims.

Priority Health may reject or deny claims for noncompliance with guidelines
Priority Health may recover or recoup claim payments when requirements are not followed
Denials or recoupment can result from inadequate documentation or incorrect coding/billing