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23-346m Bill Correctly to Get Paid for Primary Diagnosis and Interim Claims Submitted

Date: 04/18/23

New payment edits will ensure compliance with standards and billing guidelines

Effective June 21, 2023, Health Net* will implement new edits described below on claim payments to ensure compliance with company standards and national billing guidelines.

Claims edits

  • Inappropriate primary diagnosis – Health Net will deny or limit diagnosis codes based on correct coding supported by the Centers for Medicare & Medicaid Services (CMS) and ICD-10 coding guidelines. Claims will deny when billed with unacceptable primary/principal diagnosis, manifestation diagnosis, and sequela diagnosis in outpatient or inpatient facilities. Providers should submit a corrected claim with a primary diagnosis code that is in accordance with coding and CMS guidelines.
  • Interim claims – Bill type ending in XX2 or XX3 will be denied when discharge status 30 (still a patient) is not present on the claim.

Questions and answers

What is an unacceptable principal diagnosis?

  • Unacceptable principal diagnosis is a coding convention in ICD-10. Those identified codes do not describe a current illness or injury, but a circumstance which influences a patient's health status. These codes are unacceptable principal diagnosis codes.

What is the ICD-10 definition of sequela?

  • Per the ICD-10-CM Manual guidelines, a sequela code (the seventh character "S") is use for complications or conditions that arise as a direct result of an injury, such as scar formation after a burn. The scars are sequela of the burn. In other words, sequela are the late effects of an injury. Perhaps the most common sequela is pain.

Additional information

If you have questions regarding the information contained in this update, contact the Health Net Provider Services Center by email, by phone or through the Health Net provider website.

Line of business

Phone number

Email address

IFP Ambetter PPO


IFP Ambetter HMO


Health Net Employer Group HMO, POS, HSP, PPO, & EPO


Medicare (Individual & Employer Group)



This information applies to Physicians, Participating Physician Groups (PPGs), Hospitals, and Ancillary providers.

Last Updated: 04/17/2023