As we kick off football season, we also see the introduction of proposed and final rulings for payment systems, along with the initial round of coding updates for ICD-10. Although many payment system updates take effect in January, the Inpatient Prospective Payment System (IPPS) goes into effect on October 1, 2025, coinciding with the annual ICD-10 updates.
Effective October 1, 2025, ICD-10-CM introduces:
- 487 new codes
- 28 code deletions
- 38 code revisions
Likewise, ICD-10-PCS updates include:
- 156 new codes
- 27 code deletions
This includes major changes in the Medical & Surgical and New Technology chapters.
The final rule for the FFY 2026 IPPS and Long-Term Care Hospital Prospective Payment System has been issued from a payment standpoint. As teams nationwide gear up for the season, it's crucial to gather your healthcare team to prepare for the upcoming changes effective October 1, 2025—including updates to both the ICD-10 code set and payment systems.
According to the IPPS Final Rule, CMS highlights a 2.6% potential increase in operating rates and a projected $5 billion boost in hospital payments. Examining the Final Rule and the final ICD-10-PCS coding updates for the fiscal year, there is a strong emphasis on new medical technologies. The final rule estimates $192 million in New Technology Add-on Payments (NTAP), with the continuation of add-on payments for 27 technologies, 27 new or contingent approvals, and 12 expirations.
New Technology Add-on Payments are designed to compensate for the expense associated with technologies not captured in the standard MS-DRG payment due to their newness in the market. To be eligible, a technology must meet specific "newness" criteria, demonstrate substantial improvement in clinical outcomes for diagnosis or treatment compared to existing services or technologies, and exceed a defined cost threshold (refer to 42 CFR 412.87 and the IPPS Final Rule for specific requirements).
The add-on payment—made in addition to the standard MS-DRG payment—equates to the lesser of:
- 65% of the cost of the new technology, or
- 65% of the cost that exceeds the standard MS-DRG payment
(75% if the technology is designated as a Qualified Infectious Disease Product (QIDP), approved under the Limited Population Pathway for Antibacterial & Antifungal Drugs (LPAD), or designated gene therapies for Sickle Cell Disease.)
These payments typically span 2 to 3 years and undergo annual assessment. Traditionally, the "newness" period was based on entry into the U.S. market as of the fiscal year midpoint (April 1), but beginning with FFY 2026 applicants, this has shifted to the start of the fiscal year (October 1, 2025).
Playbook for Coding and Reimbursement Success
Awareness
Stay informed about technologies that qualify for NTAP status and monitor any changes to those technologies. Be aware of which new technologies are being used by clinical teams in your organization.
Documentation
Accurate provider documentation of new technology use is crucial for capturing charges and associated codes. Collaborate with clinical teams to identify where and how this information is documented in the medical record.
Charge Capture
Ensure that charges representing the cost of new technologies are properly established and captured in the account when utilized.
Coding
Coders must meticulously examine all documentation—including brand and generic names—to validate use and assign codes according to coding guidance. A single missed code can result in substantial revenue loss.
Payment Validation and Audit
Continuously validate payments received to confirm NTAP eligibility. Proactively audit documentation, charge capture, and coding to ensure revenue recognition, identify improvement opportunities, and provide timely training as needed.
Partner with MediRegs to enhance your action plan. With MediRegs, you can set alerts to keep you informed of coding and regulatory changes, and you'll have access to codebooks and tools to streamline audit and payment validation—including our IPPS MS-DRG Grouper, Calculator, and Analyzer.
MediRegs gives you the equipment you need to win!
