CMS Contractor End-to-End testing and MEDTranDirect

As we approach the deadline for implementation of ICD10, opportunities present themselves to examine our preparedness as software vendors and providers for the processing of claims containing these new codes. CMS has been ready to implement ICD10 in their claims adjudication systems since 2011. Since then, as the deadline was extended, they have made changes to their systems quarterly to fine tune them prior to October.

CMS has implemented a testing strategy beginning late last year that allows any provider to submit test claim files with ICD10 codes and review the 999 and 277CA response files returned. If you submit your claims directly to Medicare, CMS encourages you to participate in these tests. If you submit your Medicare claims through a clearinghouse, they will need to conduct these tests instead of you.

The details of CMS ICD10 testing policies are provided in this MLN Matters announcement.


This level of testing is referred to as “acknowledgement testing” since the only aspect of the process that is being tested is the validity of the ANSI 837 batch, reported in the returned ANSI 999, and the presence of any basic errors associated with each claim contained in the batch. The results of these claim edits are returned to the provider through the 277CA acknowledgement file which provides data on each claim in a valid batch that was either accepted or rejected, and the reason code.

The value of this level of testing is that you can determine as a provider, through these two response files, if the ANSI 837 batches that include ICD10 codes were formatted properly and if your test claims were sent with at least the minimum amount of information required to be processed for payment or denial.

This CMS article provides acknowledgement testing dates that include the availability of MAC EDI support staff to respond to calls specific to this process, however, these acknowledgement tests can be conducted at any time from now until the October deadline. The next official acknowledgement tests will be held in March. The actual dates are announced on each individual MAC web site. The next round of acknowledgment testing (with EDI support), is the week of 3/2/15 – 3/6/15.

If you are a provider organization and you have already implemented internal procedures to use ICD10 in your departments and systems, this is the opportunity to make sure that these systems, procedures, and data, translate into payments when they get to CMS.

In addition to acknowledgement testing, the MACs are also providing another testing process called “end-to-end” testing. This process is similar, except that in addition to providing the acknowledgement data, they provide electronic remittances (835s) as well.

The purpose of this level of testing is to simulate the actual adjudication of the claims in the back-end processing systems of CMS. In addition to checking the content of the batch and claims, it provides valuable information about the actual ICD10 codes used on the claims and their impact on payment. It includes the information you are used to seeing in your current remittances, what is paid and adjusted and what claims are denied and why. It also provides an opportunity for CMS to test their adjudication systems and make any final changes necessary to improve payment processing.

Unlike acknowledgement testing, this process is not open to everyone. Each MAC is accepting volunteer organizations for each of the three testing periods. The first testing period was in January, the next is in April, and the final period is in July. Again, most MACS are using the same week for these tests, 4/27/15 – 5/1/15 and 7/20/15 through 7/24/15. These testing periods also include EDI support.

For end-to-end testing, each MAC is picking 50 volunteers from their list for each testing period. If you have not yet applied for the April testing, it is probably too late as most of the MAC sites mention that the submitters have already been selected for this (April) round of tests.

For this round, MEDTranDirect has been selected to test with Novitas along with our customer, Kimble Hospital of Junction, TX. The advantage of this level of testing is that it allows you to not only test the validity and formatting of your claim data, but to test your coding process and other systems upstream of the software that creates and transmits your claims. Using the resulting remittance data, you can evaluate your readiness to actually get paid properly, or at least how you expect, for the claims you produce.

If you are fortunate enough to get selected, you are allowed to submit as many as three separate batches with up to 50 claims total for the combined batches. You need to take this opportunity to test as many billing scenarios as possible to make sure they are accommodated by your systems and will be processed as you expect.

For example, you are allowed to submit both claims with ICD9 and ICD10 codes in the same batch, but not on the same claim. Since you will be doing this as you transition in October, it would be best to test this now. In October, the dates of service will trigger which code set is required on the claim. During end-to-end testing, your claims need to have future dates (dates after 10/1/15) on claims with ICD10 codes and dates of service prior to this date for claims with ICD9. During basic acknowledgement testing, you are required to use current dates of service on the claims, even those that contain ICD10 codes.

Provide claims with the services you depend on for revenue the most. You have three batches available, you have 50 claims you can send with multiple charges allowed for each claim. You should be able to provide transactions representing most of the services you provide through this test. Your 835s will reflect the payments you will get for these services in October and beyond. Use this opportunity to see how they will initially be processed and reimbursed, and possibly denied.

If you can, provide different bill types, discharge status codes, and other variations in these claims that may impact payment, include these variations. Don’t assume that the claim types that are important to you will be processed properly. This represents an opportunity for CMS as well to fix the bugs that might exist in their systems that process claims from receipt to payment/denial.

If you don’t get selected for end-to-end testing, contact your vendor and find out if they are participating with another provider and when. The ideal situation is that this provider uses the same systems that you do, including patient accounting, admissions, coding and claims processing. At a minimum, they need to be using the same software that you do to create the test 837 batches. If your system is not web-based, make sure that both of you are using the same version of the software. Don’t allow your vendor to provide you with a test file that you cannot verify as being produced by your current software. This does nothing to prove that you are prepared since these files can easily be created or modified in notepad, or another text editor, prior to submission.

Without verification that you or another provider in an identical technical environment has successfully completed testing prior to the deadline, there are no guarantees that there are not defects in your processing systems that might affect reimbursement in October.


By Kalon Mitchell – President, MEDTranDirect