CMS Pub. 100-04, ch. 1, § 130.7

Adjustment Claims

(Rev. 4415; Issued: 10-11-19; Effective: 01-01-20; Implementation: 01-06-20)

The Centers for Medicare & Medicaid Services (CMS) is refining the claim adjustment

reporting process to achieve better consistency in the reporting of claim adjustments

across the Medicare Administrative Contractors (MACs) and is adding new codes to

address gaps in the current list of codes available.

The Shared Systems use different terminology for the adjustment codes. In FISS, the

adjustment codes are called Claim Frequency Codes. In MCS, the adjustment codes are

called Method of Discovery Codes. In VMS, the adjustment codes are called Accounting

Discovery Codes.

CMS is directing the A/B MACs to use claim frequency code “H” when CMS initiates

the Part A claim adjustment, such as a mass adjustment directed by CMS to address

system issues, and claim frequency code “I” when the A/B MAC identifies and initiates

the Part A claim adjustment.

CMS is also creating a new method of discovery code “12” to identify Part B adjustments

in MCS that were initiated by CMS, and a new method of discovery code “13” for MAC

initiated Part B adjustments in MCS. The A/B MACs should use method of discovery

code “12” for CMS-directed adjustments that do not fall into the “C” - CMS Review

category or other existing CMS-related method of discovery categories. The A/B MACs

should use method of discovery code “13” for MAC identified and initiated adjustments

that do not fall into the existing method of discovery code categories, such as method of

discovery code “A”. The A/B MACs should use method of discovery code “A” for

adjustments arising from MAC initiated internal review, such as adjustments to address

errors the MAC identified while processing the claim or adjustments due to MAC

internal quality reviews.

For provider initiated adjustments, MACs should continue with their current method of

reporting (claim frequency code “7” for Part A claims, method of discovery code “P” for

Part B MCS claims, and accounting discovery code “D” for Part B DME claims).