Texas Medicaid is updating its coverage criteria for cranial remolding orthosis (CRO), procedure code S1040, effective for dates of service on or after September 01, 2026. The update comes in accordance with House Bill 426 passed during the 89th Legislature, Regular Session, 2025.

Under the revised criteria, a CRO may be covered when it is part of a documented treatment plan for a client diagnosed with one of the following non-synostotic deformational plagiocephaly conditions: lateral deformational plagiocephaly (LDP), brachycephaly, asymmetrical brachycephaly, or dolichocephaly.

What These Conditions Mean

A CRO is defined under the Human Resources Code, Chapter 32, Subchapter B, Section 32.03126 as a custom-fitted or custom-fabricated medical device applied to the head to correct a deformity, improve function, or relieve symptoms of a structural cranial condition.

Plagiocephaly refers to an asymmetrical, flattened skull shape and can describe both synostotic and non-synostotic conditions. Craniosynostosis is when cranial sutures fuse prematurely, which can cause synostotic plagiocephaly. Non-synostotic deformational plagiocephaly (DP), on the other hand, is skull flattening caused by external pressure during the first year of life.

The four qualifying non-synostotic conditions are defined as follows. LDP is an asymmetric head shape caused by flattening on one side of the skull, either at the forehead or the back of the head, and can involve displacement of the ear, forehead, or orbit in severe cases. Brachycephaly describes a short, wide head where the back of the skull flattens and the sides widen. Asymmetric brachycephaly combines features of both plagiocephaly and brachycephaly, with flattening at the back of the head and asymmetry in the parietal region. Dolichocephaly is characterized by flattening on both sides of the head with elongation from front to back.

Before a CRO is considered, conservative therapy should be attempted. This includes non-surgical methods like repositioning, increased tummy time, and physical therapy to address underlying torticollis. These approaches are most effective when started before four to six months of age.

Claims Reimbursement

Claims for procedure code S1040 may be reimbursed for clients who are between 3 months and 18 months of age and have a documented diagnosis of either synostotic plagiocephaly resulting from craniosynostosis or non-synostotic plagiocephaly that meets the diagnostic criteria. CRO is limited to one device per lifetime across all providers. This limit can be exceeded with prior authorization. Orthotist providers may also be reimbursed for services rendered in the home setting.

Prior Authorization and Documentation Requirements

Prior authorization is required for CRO. The following diagnosis codes may be approved:

For clients who need a second device beyond the one-per-lifetime limit, prior authorization may be considered if all of the following are documented: the first device was obtained to treat synostotic or non-synostotic plagiocephaly, treatment has been effective but the treatment goal has not yet been reached, and the new device is needed because the client has grown.

If the client has craniosynostosis, the type of craniosynostosis and synostotic plagiocephaly must both be documented. For non-synostotic plagiocephaly diagnoses, one of the following must be confirmed: cranial vault asymmetry (CVA) with a right or left discrepancy greater than six millimeters in a craniofacial anthropometric measurement, including criteria set by the Children's Healthcare of Atlanta Plagiocephaly Severity Scale; or brachycephalic or dolichocephalic disproportion confirmed by a cephalic index of two standard deviations from the mean.

For diagnoses of brachycephaly, asymmetric brachycephaly, or dolichocephaly specifically, there must also be documentation showing at least two months of conservative or physical or occupational therapy by a qualified provider that did not sufficiently reduce the asymmetry or disproportion.

For more information, call the TMHP Contact Center at 800-925-9126.

Note: Texas Medicaid MCOs must provide all medically necessary, Medicaid-covered services to enrolled members. Administrative procedures may differ from traditional Medicaid and from one MCO to another. Providers should contact the member's specific MCO for details.