Permitted Diagnosis Rules - enforce CPT-to-ICD medical necessity

Use Permitted Diagnosis Rules to ensure every CPT billed to insurance has an allowed ICD‑10 diagnosis. During insurance billing/export, the LIS validates each CPT on the claim against these rules to reduce payer rejections and denials.

What the rule controls

• CPT Code that require specific ICD‑10s
• Optional constraints: Patient Gender, Bill Type, Client(s), and Payer(s)
• The set of permitted ICD‑10 codes associated to that CPT under the selected constraints
• Comments/notes for audit/reference

Rules are evaluated when invoices/claims are created for insurance. If a CPT lacks a permitted diagnosis, the system flags or blocks the item per your billing/export policies.

📘 Create a permitted diagnosis rule

1. Open Billing → Permitted Diagnosis Rules.
2. Enter:
   • CPT Code and Rule Name.
   • Gender (Male, Female, Any) if applicable.
   • Bill Type (typically Insurance).
   • Client(s) and Payer(s) to target the rule (leave blank for a broader/global rule if your policy allows).
3. Click Add to create the rule shell.
4. Click Diagnosis to select the permitted ICD‑10 codes for this CPT.
5. Add Comments as needed.
6. Save.

Tip: Use Clone to copy an existing rule and change only the payer/client or small code differences to speed setup.

How validation works (at billing time)

• For each CPT on an insurance claim, the LIS looks for the most relevant rule (matching Payer/Client/Bill Type/Gender).
• If any diagnosis on the order matches the rule’s permitted ICD‑10 set, the CPT is allowed.
• If no match is found, the CPT is flagged according to your Billing Settings (e.g., show rejection report and cue the user to fix, or block export).

Note: Keep total diagnoses per claim ≤ 12 unique diagnosis (see Billing Settings) to avoid downstream payer errors.

Best practices

• Build payer‑specific rules first (LCD/NCD, payer policies), then add client‑specific exceptions only when necessary.
• Use Gender when procedures are sex‑specific.
• Document the policy source in Comments (policy ID, effective date).
• Review rules periodically for payer updates and retire obsolete entries.
• Prefer a small, curated diagnosis set per CPT to minimize claim size and improve medical‑necessity alignment.

Troubleshooting

• CPT still rejected: Confirm you selected the correct Payer/Client and Bill Type, and that an allowed ICD‑10 is actually present on the order.
• Rule not applying: Check for a more specific overlapping rule; verify the CPT on the charge matches the CPT in the rule.
• Too many denials after an update: Audit recent payer policy changes and use Clone to quickly adjust affected rules.