FY 2027 ICD-10-CM Changes for PT, OT, and Chiro Claims

Effective for dates of service on and after October 1, 2026, CMS’s FY 2027 ICD-10-CM update adds 190 codes, deletes 30, and revises 4, moving the valid code set from 74,719 codes to 74,879 (FY2027 code descriptions file). Chapter 13, diseases of the musculoskeletal system and connective tissue, the chapter outpatient PT, OT, and chiropractic claims lean on hardest, accounts for 31 of those additions.

The one change nearly every rehab clinic will hit: plantar fasciitis leaves M72.2 and moves to a new subcategory, M67.A0-, with separate codes for the right foot, left foot, and unspecified foot (tabular and index addenda). If your favorites list, evaluation templates, or open plans of care still point to M72.2 on October 1, the claim line is carrying a code that no longer exists for that date of service.

That matters because a deleted or truncated code isn’t a paperwork nuance. On a Medicare claim, a diagnosis pointer that resolves to a code no longer in effect is invalid information under Ch. 1 §80.3.1 of the Medicare Claims Processing Manual, and the claim comes back unprocessable, not denied, with no appeal rights attached. This guide works from the primary FY2027 files: the codes addenda, the tabular and index addenda, the conversion table, and the FY 2027 ICD-10-CM Official Guidelines. Current as of September 2026.

When do the FY 2027 ICD-10-CM codes take effect?

FY 2027 ICD-10-CM codes apply to encounters and services occurring from October 1, 2026, through September 30, 2027 (CMS; CDC/NCHS). The governing rule is the date of service, not the date the claim is filed. The Medicare Claims Processing Manual, Ch. 23 §10 states it directly: “CMS accepts only HIPAA approved ICD-9-CM or ICD-10-CM/ICD-10-PCS codes, depending on the date of service.” For a service line billed with a span of dates, Ch. 26, Item 21 instructs billers to “use the ‘from’ date to determine which ICD code set to use,” so the simplest way to keep every diagnosis pointer valid is to keep September and October dates of service on separate claims rather than spanning the cutover on one line.

This isn’t a Medicare-only calendar. 45 CFR 162.1011 provides that “each code set is valid within the dates specified by the organization responsible for maintaining that code set.” Because the National Center for Health Statistics, not any individual payer, sets ICD-10-CM validity dates, every HIPAA-covered payer, commercial insurers and state Medicaid programs included, follows the same October 1 cutover.

What changed in the FY 2027 ICD-10-CM update?

The scale of the update, straight from the codes addenda file: 190 additions, 30 deletions, and 4 revisions, moving the code count from 74,719 in FY2026 to 74,879 in FY2027.

Two chapters carry almost all of the rehab-relevant activity. Chapter 13 (diseases of the musculoskeletal system) gets 31 additions and 9 deletions. Chapter 19 (injury, poisoning, and other consequences of external causes, the S and T codes) gets 60 additions, all of them toxic-effect codes (T52.81-, T52.82-, T52.89-, T59.82-, T65.85-), and 15 deletions, including the sternoclavicular sprain codes covered below. The files themselves were posted in June 2026: addenda and code descriptions dated June 16, guidelines dated June 8, and the conversion table dated August 13, per the CDC/NCHS files page.

None of the four revisions touch rehab documentation: L02.232, L03.312, and L03.322 gain “and flank” exclusion wording, and Z29.14’s description is corrected from “globin” to “globulin.”

The remap table for outpatient PT, OT, and chiropractic claims

Three more deletion groups round out the full list of 30: D69.1 (qualitative platelet defects, now D69.11/D69.19), Z87.890 (personal history of sex reassignment, now five codes Z87.8901 through Z87.8909 plus new Z87.893), and the twelve T52.8X- toxic-effect-of-organic-solvent codes, replaced by 36 new T52.81-, T52.82-, and T52.89- codes.

New codes worth knowing: M04.3 (VEXAS syndrome, new to Chapter 13), and exposure-history codes Z77.32 (burn pits, war theater), Z77.33 (Agent Orange), Z77.40 through Z77.49 (blast overpressure exposure), and Z86.17 (personal history of Clostridioides difficile infection). The Z77 codes matter most for clinics treating veterans, where documenting exposure history supports the record.

Plantar fasciitis: the index revision and the laterality trap

The index addenda revise the entry for “Fasciitis, plantar” from M72.2 to “plantar (foot) M67.A0-”, while the entry for “Fibromatosis, plantar (fascial)” is revised to point to the new M72.2- subcategory. The tabular addenda also revise the Excludes1 note at M72.8, from excluding “plantar fasciitis (M72.2)” to excluding “plantar fasciitis (M67.A0-).” Watch the numbering quirk: M67.A09 uses 9 for the unspecified-foot code, while M72.20 (plantar fascial fibromatosis) uses 0 for unspecified. They look parallel and aren’t.

Laterality follows the general rule in the FY 2027 guidelines, Section I.B.13: “If no bilateral code is provided and the condition is bilateral, assign separate codes for both the left and right side. If the side is not identified in the medical record, assign the code for the unspecified side.” There is no bilateral plantar fasciitis code, so a bilateral diagnosis is billed as two codes, M67.A01 and M67.A02, on the same claim.

Sternoclavicular sprain: a cleanup, not a new code

S23.420 (all three seventh-character variants, A, D, and S) is deleted, but the replacement codes, S43.60-, S43.61-, and S43.62-, already existed in the code set before FY2027; they were simply duplicated by S23.420. That’s why there’s no conversion-table row for this change: no new code was created, the duplicate was removed. S23.421 (chondrosternal sprain), S23.428 (other sprain of sternum), and S23.429 (unspecified sprain of sternum) are unchanged.

A note for chiropractic claims: M99.0- didn’t move

Medicare’s three covered chiropractic manipulative treatment codes are driven by subluxation diagnosis codes, M99.0-, and none of those codes appear anywhere in the FY2027 additions, deletions, or revisions. If your clinic bills Medicare chiropractic claims on subluxation codes alone, this update doesn’t touch those claims. It reaches a chiropractic practice through secondary diagnoses (a BMI code, a cardiomyopathy code) and through cash-pay or commercial claims that carry a condition like plantar fasciitis, where one of the 30 deleted codes may be sitting in a template.

What does a deleted ICD-10 code return on a claim?

A diagnosis code that is “no longer in effect” meets the definition of invalid information under Ch. 1 §80.3.1 of the Medicare Claims Processing Manual, which defines invalid information as data on a claim that is “illogical, or incorrect …, or no longer in effect (e.g., an expired number),” and an unprocessable claim as one containing “complete and necessary information; however, the information provided is invalid.” The same section states plainly: “A claim returned as unprocessable for incomplete or invalid information does not meet the criteria to be considered as a claim, is not denied, and, as such, is not afforded appeal rights.”

In practice, the Medicare Administrative Contractor returns the claim with Group Code CO, Claim Adjustment Reason Code 16 (“Claim/service lacks information or has submission/billing error(s),” per X12), and Remittance Advice Remark Code M76 (“Missing/incomplete/invalid diagnosis or condition,” per X12). There’s nothing to appeal; the fix is to correct the diagnosis and resubmit, as §80.3.1 directs. Outside Medicare’s own edit, the X12 code list also carries CARC 146, “Diagnosis was invalid for the date(s) of service reported,” which names the date-of-service mismatch directly, and the remark codes MA63 (“Missing/incomplete/invalid principal diagnosis”) and M64 (“Missing/incomplete/invalid other diagnosis”). Which of these a commercial payer or clearinghouse returns depends on its own edit tables; in Medicare’s manual, MA63 is tied to a narrower case (an external-cause code in the first diagnosis position), so M76 is the one to expect from a MAC.

Truncated codes get the same treatment as deleted ones. Under guideline I.B.2, “diagnosis codes are to be used and reported at their highest number of characters available,” and “a code is invalid if it has not been coded to the full number of characters required for that code.” After October 1, Z68.1 and M72.2 are truncated codes rather than deleted ones in the strict sense, but the claim effect is the same: invalid for the date of service. If your clinic sees a rise in returned or denied claims in October, this is the first place to check.

How do you handle plans of care and episodes that cross October 1?

The plan of care and the evaluation are clinical documents; the claim line is what actually carries the code. A plan of care written in August with M72.2 on it doesn’t need to be rewritten just because the code number changed. What has to change is every claim line with a date of service on or after October 1, which must carry a code valid on that date. The practical sequence: update the diagnosis on the first visit note dated October 1 or later, carry that update into the next progress report, and update the claim’s diagnosis pointers accordingly.

The FY2027 files say nothing about whether a recertification is required when a code number changes mid-episode, and we are not asserting one either way. For the certification and recertification rules themselves, our plan of care certification guide covers the timing and signature requirements.

A physician referral dated in September that lists M72.2 is still a valid referral document; nothing about the referral itself expires. What changes is the diagnosis code the therapist assigns on the claim, which follows the FY2027 index at the time of service, not the code printed on an older referral. For a plantar fasciitis referral specifically, that means the claim uses M67.A0- with laterality documented, even though the referral order still reads M72.2. The safest structural fix, as noted above, is to keep September and October dates of service on separate claims so every line’s diagnosis pointer resolves to a code valid on that line’s date of service.

EHR housekeeping checklist before October 1

1. Export your diagnosis favorites list and search it for all 30 deleted codes, especially M72.2 and Z68.1, the two an outpatient rehab or chiropractic clinic is most likely to carry.
2. Check evaluation and plan-of-care templates. Any template with a pre-populated plantar fasciitis, sternoclavicular sprain, or BMI code needs the new code and, for plantar fasciitis, a laterality prompt.
3. Run a report of open episodes crossing October 1 and update the diagnosis on any active plan of care that still uses a deleted code, at the first October visit.
4. Map referral diagnoses at intake, not at claim submission. Incoming referrals will keep arriving with M72.2 on them for months; translate the code when the referral comes in rather than copying it straight onto the claim.
5. Confirm your claim scrubber or clearinghouse is on the FY2027 code table before your first October billing batch. A scrubber still validating against FY2026 will let M72.2 pass, and the MAC will return it anyway.
6. For chiropractic claims, confirm your primary diagnosis is still M99.0-. Those codes didn’t change, so Medicare CMT claims are unaffected unless a secondary diagnosis is one of the 30 deleted codes.
7. Mark your calendar for next year. Check the CMS ICD-10-CM page and the CDC/NCHS files page again; annual files post in June ahead of October 1, and NCHS can also publish a smaller update effective April 1, so check both dates.

Code favorites, evaluation templates, and open plans of care all need a review before October 1, and that’s easy to put off until a claim bounces back. PrismEHR lets organizations define their own billing rules, enforced at the point of documentation and reinforced again at claim creation, which is where a code-set check belongs: at the visit, not after the MAC returns the claim. See how it fits physical therapy practices, and if plantar fasciitis claims are part of what you’re remapping, our Medicare PT claim denials guide covers what to do when one comes back unprocessable.