CPR’s “Coding Corner” focuses on coding, compliance and documentation issues relating specifically to physician billing. This month’s tip comes from G. John Verhovshek, managing editor for AAPC, a training and credentialing association for the business side of health care.  

Modifier 59 Distinct procedural service alerts payers that two codes, not normally reported together, should be reimbursed separately as distinct and independent services. Distinct or independent services may include: 

• Different session


• Different procedure or surgery


• Different site or organ system


• Separate incision/excision


• Separate lesion


• Separate injury

CPT® Appendix A explains, “Only if no more descriptive modifier is available, and the use of modifier 59 best explains the circumstances, should modifier 59 be used.” Because of this, modifier 59 is often called the “modifier of last resort.”

The July 2000 CPT Assistant provides an example of proper modifier 59 use:

… a lesion is removed from the forehead, resulting in a 5.2 sq cm defect, and another lesion is removed from the neck, resulting in a 7.3 sq cm defect, and both require rotational advancement flaps to provide closure… code 14040 [Adjacent tissue transfer or rearrangement, forehead, cheeks, chin, mouth, neck, axillae, genitalia, hands and/or feet; defect 10 sq cm or less] would be reported twice, with modifier -59 appended to the second code. Although both anatomic sites fall into the same anatomic classification as defined by the code descriptor for code 14040, the defects do not have contiguous margins and represent separate and distinct defects.

Modifier 59 is the most widely used HCPCS modifier, and perhaps the most widely abused. For example, a 2005 report by the Office of Inspector General (OIG), “Use of Modifier 59 to Bypass Medicare’s National Correct Coding Initiative Edits,” found that 40 percent of modifier 59 claims failed to meet the Center for Medicare & Medicaid Services (CMS) program requirements. Since that time, CMS attempts to educate practitioners regarding appropriate use of modifier 59 have had disappointing results. For instance, 2013 CERT Report data projected $770 million in incorrect modifier 59 payments over the course of one year. As a result, modifier 59 is a frequent target of payer audits, and it has appeared on the Office of Inspector General’s annual work plan every year for a decade.

In a new move to curb improper use of modifier 59, CMS Transmittal 1422, Change Request 8863, defines four new modifiers, called the “X{EPSU}” modifiers, which are subsets of “Distinct Procedural Services”:

• XE – Separate Encounter – Used to describe services that are separate because they take place during separate encounters;


• XS – Separate Structure – Used to describe services that are separate because they are performed on different anatomic organs, structures or sites;


• XP – Separate Practitioner – Used to describe services that are distinct because they are performed by different practitioners; and


• XU – Unusual Non-Overlapping Service – Used to describe services that are distinct because they do not overlap the usual components of the main service.

Per CR8863, CMS will continue to recognize modifier 59, but beginning January 1, 2015, will require the X{EPSU} modifiers in specific cases:

CMS will not stop recognizing the -59 modifier but notes that CPT instructions state that the -59 modifier should not be used when a more descriptive modifier is available. CMS … may selectively require a more specific - X{EPSU} modifier for billing certain codes at high risk for incorrect billing. For example, a particular NCCI PTP code pair may be identified as payable only with the -XE separate encounter modifier but not the -59 or other -X{EPSU} modifiers. The -X{EPSU} modifiers are more selective versions of the -59 modifier so it would be incorrect to include both modifiers on the same line.

CMS has encouraged immediate adoption of the X{EPSU} modifiers by all Medicare payers, stating, “contractors are not prohibited from requiring the use of selective modifiers in lieu of the general -59 modifier when necessitated by local program integrity and compliance needs.” As such, not only should medical providers prepare for the new modifiers, they should also expect even greater scrutiny of any modifier 59 claims, as well.