Dermatology Coding Alert

Question: The dermatologist sent in a skin specimen and frozen section for evaluation in the pathology lab, but the posterior margin is incompletely excised. How should this be coded? And what if the dermatologist sends the pathologist an additional portion of the posterior margin, which the pathologist examines, and does another frozen section? How is this coded? Does the coding depend on whether the margin is clear or if it still contains basal cell carcinoma?

Maryland Subscriber

Answer: You report the first excision based on the initially excised margins. The second excision is based on the additional margins. You should append modifier -58 (Staged or related procedure or service by the same physician during the postoperative period) to the second excision to report that the dermatologist completed a related service after the initial procedure.

You should also report the appropriate diagnostic code for malignancy as indicated on the first pathology report for the removal of the malignant lesion.    

If the pathologist is billing for the additional portion of the posterior margin, you report the specimen as tissue(s) that is submitted for individual and separate attention, requiring individual examination and pathologic diagnosis. You assign an individual code to reflect the proper level of services when reporting two or more such specimens from the same patient (e.g., separately identified endoscopic biopsies, skin lesions, etc.).

You should report code 88305 (Level IV -- Surgical pathology, gross and microscopic examination; skin, other than cyst/tag/debridement/plastic repair). So, if the frozen section and skin specimen are from the same lesion, you only report one code. If the frozen section is from a different lesion, you should report an additional code for the additional specimen.