Coding Corner: Question modifier 25 denials

October 01, 2015
Area(s) of Interest: Payor Issues and Reimbursement Practice Management 

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, the managing editor for AAPC, a training and credentialing association for the business side of health care.   

Third-party payers frequently deny evaluation and management (E/M) claims for the same patient reported on the same day as an in-office procedure. To avoid these denials, be sure you have the necessary documentation to back up your claim, and pursue appeals to receive the payment you deserve. 

Under both AMA/CPT® and Centers for Medicare and Medicaid Services (CMS) guidelines, providers may receive separate payment for a medically necessary E/M service on the same day as a minor procedure. Both the procedure and the separate, same-day E/M service must be linked to a diagnosis substantiated in the medical record. Per CMS Transmittal R954CP, “The E/M service may be prompted by the symptom or condition for which the procedure and/or service was provided. As such, different diagnoses are not required for reporting of the E/M services on the same date.

Transmittal R954CP further instructs us to apply modifier 25 Significant, separately identifiable evaluation and management service by the same physician or other qualified provider on the same day of the procedure or other service, for “a significant, separately identifiable E/M service that is above and beyond the usual pre- and post-operative work for the service,” while also requiring that providers “appropriately and sufficiently” document medical necessity for both the E/M service and the other service or procedure.

The AMA’s CPT Assistant (May 2011) provides the following example of proper coding:

A 4-year-old slips on the edge of a pool, strikes the mandible and experienced a 3.5-cm serrated and curvilinear, full-thickness laceration of the chin. The child’s pediatrician elects to widely excise the serrated skin margins and undermine the dermis from the subcutaneous tissue to reduce the tension on the suture line. The wound is then approximated in layers with absorbable interrupted sutures and a running subcuticular closure.

This procedure would be reported with code 13132 Repair complex, forehead, cheeks, chin, mouth neck, axillae, genitalia, hands and/or feet; 2.6 to 7.5 cm. Any significant, separately identifiable E/M service performed in addition to the wound repair would be reported separately using modifier 25.

To be considered “significant” and “separately identifiable,” the E/M service must meet certain criteria. Generally speaking, if the E/M service is unrelated to the minor procedure, it may be reported separately. Or, if the E/M service occurs due to exacerbation of an existing condition, or other change in patient status, that service may be separately reported if it is supported by documentation. If the patient arrives for a prescheduled procedure, however, you probably should not report a separate E/M service unless the patient has a new, unrelated complaint or has experienced a worsening of symptoms that prompts a new history, exam and medical decision-making process that might include additional testing or therapy.

The American Academy of Family Physicians (AAFP) recommends that providers ask themselves the following questions to help determine if modifier 25 is appropriate:

  • Did you perform and document the key components of a problem-oriented E/M service for the complaint or problem?

  • Could the complaint or problem stand alone as a billable service?

  • Is there a different diagnosis for this portion of the visit?

  • If the diagnosis is the same, did you perform extra physician work that went above and beyond the typical pre- or postoperative work associated with the procedure code?

The bottom line: If there is a documented history, exam and medical decision-making apart from any other procedures the physician performs on the same day, modifier 25 likely applies. To support your claims further, when an E/M service leads to an unplanned, same-day procedure, documentation should prove that the decision to perform the procedure was made during the encounter.

Although not required, the best practice is to separate the E/M note from the procedure note. Per CMS Transmittal R954CP, you do not need to submit full documentation with your claim, but the documentation must be available upon payor request.

In every case, if you’ve received a denial for a clean claim supported by documentation, be sure to appeal. Appeals mean extra work, but the coding guidelines are on your side, and consistently writing off these claims will hurt the practice’s bottom line. Per The Medicare Claims Processing Manual, Chapter 12, Section 30.6.6.B, Medicare contractors may impose prepayment requirements on modifier 25 claims only if the payer has specific evidence of misuse or abuse:

When a carrier has conducted a specific medical review process and determined, after reviewing the data, that an individual or a group has high use of modifier “-25” compared to other physicians, has done a case-by-case review of the records to verify that the use of modifier was inappropriate, and has educated the individual or group, the carrier may impose prepayment screens or documentation requirements for that provider or group.

Look out for three exceptions: There are specific circumstances under which the normal requirements for billing a separate E/M service with a same-day minor procedure do not apply, per The Medicare Claims Processing Manual, Chapter 12, Section 30.6.6.B:

  1. When inpatient dialysis services are billed (CPT® codes 90935, 90945, 90947 and 93937), the physician must document that the service was unrelated to the dialysis and could not be performed during the dialysis procedure.

  2. When preoperative critical care codes are being billed on the date of the procedure, the diagnosis must support that the service is unrelated to the performance of the procedure.

  3. Carriers may not permit the use of modifier 25 to generate payment for multiple evaluation and management services on the same day by the same physician, notwithstanding the CPT® definition of the modifier. 


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