The official regulations (a section is included below) don't specifically require one or the other, but only say that both the physician ordering the service and the entity submitting the claim must maintain documentation of medical necessity in the record and be able to provide this information if the claim is reviewed. In my experience, many diagnostic testing facilities prefer a narrative statement rather than a code as this can avoid confusion and prevent the facility from having to contact the provider for clarification if there are any issues. Some facilities prefer to be responsible for their own code choices rather than relying on an assumption that the ordering provider has correctly chosen the ICD-10 code on the order. You may wish to discuss this with the labs and testing facilities to which your provider refers patients and find out what is their preference.
(2) Documentation and recordkeeping requirements—(i) Ordering the service. The physician or (qualified nonphysican practitioner, as defined in paragraph (a)(3) of this section), who orders the service must maintain documentation of medical necessity in the beneficiary’s medical record. (ii) Submitting the claim. The entity submitting the claim must maintain the following documentation: (A) The documentation that it receives from the ordering physician or nonphysician practitioner. (B) The documentation that the information that it submitted with the claim accurately reflects the information it received from the ordering physician or nonphysician practitioner. (iii) Requesting additional information. The entity submitting the claim may request additional diagnostic and other medical information to document that the services it bills are reasonable and necessary. If the entity requests additional documentation, it must request material relevant to the medical necessity of the specific test(s), taking into consideration current rules and regulations on patient confidentiality.
(3) Claims review. (i) Documentation requirements. Upon request by CMS, the entity submitting the claim must provide the following information: (A) Documentation of the order for the service billed (including information sufficient to enable CMS to identify and contact the ordering physician or nonphysician practitioner). (B) Documentation showing accurate processing of the order and submission of the claim. (C) Diagnostic or other medical information supplied to the laboratory by the ordering physician or nonphysician practitioner, including any ICD–9–CM code or narrative description supplied.
