ED Coding and Reimbursement Alert

Modifier -25 (significant, separately identifiable evaluation and management service by the same physician on the same day of the procedure or other service) has caused coders significant problems since it was created in 1992. Even though CPTs 1999 clarification of modifier -25 added language that makes it much easier for coders to understand when and how to append the modifier, some questions about use and reimbursement still remain.

Modifier -25 is used correctly to identify an evaluation and management (E/M) service that is both significant and unrelated to the procedure the physician performed or will perform. Normally, E/M services provided on the same day are included in the procedure, but by attaching modifier -25, the physician overrides the carriers software edit, and he or she likely will be reimbursed for the service.

Mason Smith, MD, FACEP, president of Lynx Medical Systems, a coding and documentation consulting firm in Bellevue, Wash., says coders and payers still have a broad misconception that any time a procedure is done, no visit code is payable.

Modifier -25 indicates to Medicare and third-party payers that a surgical procedure performed on the same day was significantly different from the E/M visit procedure that the -25 modifier is appended to. Simply put, Smith asserts, If I use the -25 modifier, I want to be paid for the visit. If I leave it off, I do not want to be paid. This sounds like a simple issue, but years of misunderstanding and entrenched ideas have complicated the matter.

Reimbursement is also problematic at times, according to Diane Krier-Morrow, CCS-P, MBA, MPH, manager of the Chicago staff for the Socioeconomic Affairs Department of the American College of Surgeons, and many payers still deny E/M services because they do not recognize or understand modifier -25.

Examples of Use and Misuse of Modifier -25

The following is an example of the correct use of modifier -25. A lady falls and strikes her head, sustaining a 4-cm laceration on her face. She goes to the emergency department (ED) for examination of the injury, and the laceration is treated. To bill for the laceration repair, the coder would use 12013 (simple repair of superficial wounds of face, ears, eyelids, nose, lips and/or mucous membranes; 2.6 cm to 5.0 cm). Depending on the complexity of the exam, E/M code 99283 (emergency department visit for the evaluation and management of a patient, which requires an expanded problem-focused history and examination, and medical decision-making of moderate complexity) or 99284 (emergency department visit for the evaluation and management of a patient, which requires a detailed history and examination, and medical decision-making of moderate complexity) could be used, along with the -25 modifier.

Now here is an example of modifier -25 being misused. The above patient is seen at her primary-care physicians office. The doctor examines the patient, identifies the laceration, and refers her to the emergency department for treatment. In this situation, the E/M visit has already been performed by the primary-care physician, Smith says. He adds, In that case, ED coders should not use the modifier -25. Now it is just an outpatient surgery that just happens to be done in the ED.

Not every modifier -25 case is clear-cut. Consider the following: A man cuts his finger while washing dishes and comes to the emergency department. There is no real exam, just a decision about how to repair the laceration. Then it gets tricky, Smith says. CPT instructs that you still have to report the visit, usually with 99281 (emergency department visit for the evaluation and management of a patient, which requires a problem-focused history and examination, and straightforward medical decision-making) or 99282 (emergency department visit for the evaluation and management of a patient, which requires an expanded problem-focused history and examination, and medical decision-making of low complexity), then list the laceration repair (12013) as well. But do not append a modifier to the visit code in this case because it is not a significantly different procedure.

Many physicians will argue that every patient who comes to the ED has an undifferentiated condition and that it is always necessary to do an exam to determine whether the obvious problem is the only problem, Smith said. For this reason, emergency medical organizations have sought formal guidance from the Health Care Financing Administration (HCFA) on the meaning of significant as it relates to modifier -25. To date, no response or guidance has been given.

All Facilities Expected to Use Modifier -25

For years, modifier -25 was an issue for physicians only. But with the advent of ambulatory payment classifications (APCs) on July 1, hospitals and outpatient treatment centers will lose money if they do not use the modifier.

Consider a level-four evaluation of an elderly person with a head injury, Smith says. Payment for that visit will be $155 unadjusted. The laceration repair (12013) will pay $118 unadjusted. So if modifier -25 is placed on E/M code 99284, the hospital will receive an extra $155 for the hospital E/M visit service. If the hospital does not put a modifier -25 on its UB-92 bill, then the visit will not be paid, only the laceration repair will.

This coding could cause problems for facilities that use cost-based reimbursement. Smith said that 1,800 American hospitals use 99201, the lowest level of new-patient office visits, for every emergency department visit. After July 1, They will have to turn in the appropriate CPT code, and they will be paid just like physician practices. In the past, many hospitals didnt even record the revenue code.

Understanding a New Language

Technically, modifier -25 applies to all visit codes within the 10000 to 69999 range, Smith says. Confusion about its use sparked the addition of the following language to the 1999 edition of CPT, The E/M service may be prompted by the symptoms 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.

The new language is straightforward, allowing coders to use modifier -25, regardless of the diagnosis, if the significant, separately identifiable criteria are met. The primary task for payers is to look at the diagnosis for the procedure and the diagnosis for the visit, Smith maintains. If the diagnosis code did not differ at the third number, that triggered an automatic denial, with or without the -25 modifier.

Unfortunately, the new language addresses only half of the problem. Modifier -25 was adopted in 1992 to set limits on when doctors could charge visit codes in addition to surgical procedures. The theory was sound, but they used a very blunt sword, Smith explains. They said that any time the procedure and the visit were different, they would pay for both. But they never figured out how to define a significant difference.

Obtaining Payment

Often, payers are reluctant to reimburse any E/M service with a procedure, Krier-Morrow says. Many carriers are not appropriately paying both an E/M and a procedure on the same day. They feel that if you had only one diagnosis for the evaluation and management and the procedural service, they could deny the claim.

The recent language changes have removed some of the ambiguity about diagnoses from the guidelines, but only Medicare is required to reimburse for modifier -25. Lots of payers ignore all modifiers, Smith maintains. Some follow modifier rules set by Medicare, but you are at the mercy of the payer.

If a payer ignores modifiers, coders and their facilities have little recourse. Insurers reluctance to pay for visits with procedures is very inconsistent with CPT and HCFA policy, but it is a prevalent attitude, Smith says.