Temporarily deactivating reason codes 31006 and 31007 for CAH method II claims
CMS has issued new instructions concerning the Fiscal Intermediary Standard System (FISS) reason codes 31006 and 31007 for method II critical access hospital (CAH) claims involving professional services. These codes were initially implemented to track physicians’ reassignment of benefits to CAHs, but recent concerns with claim denials resulted in CMS temporarily deactivating these edits.
Change request (CR) 13900, titled "Editing for Duplicate Processing for Practitioner Professional Services and CAH Professional Services" was introduced to ensure that reassignment information for physicians was on file in the PECOS when method II CAH claims for professional services were submitted. However, it has come to CMS's attention that many providers have failed to report their reassignments in PECOS, resulting in claim denials with reason codes 31006 and 31007.
Due to the volume of errors related to these reassignment issues, CMS has decided to temporarily turn off reason codes 31006 and 31007 to allow for additional provider education and to give health care providers more time to submit the necessary reassignment applications. The delay will also allow MACs to process these applications without causing undue disruptions in reimbursement.
This temporary deactivation will remain in place until January 1, 2026.
Provider actions
While reason codes 31006 and 31007 are deactivated, providers must take the following actions to prevent future claim denials:
Reassignment applications: Providers must ensure that all eligible health care professionals who reassigned their benefits to a CAH are correctly reported in PECOS. This includes submitting the necessary Medicare Enrollment Application – Physicians and Non-Physician Practitioners (CMS-855I) application to record the health care professional’s reassignment under the CAH’s Part A enrollment.
- To add the reassignment to the CAH’s enrollment record, submit the application using the Part A Medicare identification number of the CAH hospital not the clinic’s enrollment. This identification number is the NPI and CMS Certification Number (6-digit CCN) of the CAH’s enrollment record.
- Submission deadlines: CAH’s are encouraged to submit these applications promptly so that First Coast can process them before the reason codes are reactivated on January 1, 2026. This will help avoid unnecessary claim denials when the edits are re-enabled.
- Educational resources: CMS and the A/B MACs will continue to provide educational resources to guide providers through the process of reassignment reporting.
Next steps and claims adjustments
For claims with dates of service on or after July 1, 2025, where professional service revenue codes 096X, 097X, or 098X were denied with reason codes 31006 or 31007, First Coast will take appropriate steps to adjust or reprocess these claims.
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