EM Coding Alert

Remember: Minor procedures have a zero-day or 10-day post-op period.

If your practice bills Pennsylvania's Independence Blue Cross Blue Shield, make sure you check out their latest modifier 25 policy. According to the information found within this policy, you are now looking at a 50 percent reduction to claims appended with modifier 25.

Practices Billing This Payer Will See Modifier 25 Pay Slashed by Half

Here's the scoop: Effective as of Aug. 1, Independence will reimburse claims appended with modifier 25 (Significant, separately identifiable evaluation and management service by the same physician or other qualified health care professional on the same day of the procedure or other service) "at 50 percent of the applicable fee schedule amount" in the following circumstances, the payer said in a May 1 notification:

• When the E/M service is submitted on the same date of service, by the same professional provider or other qualified healthcare provider, as a minor procedure. Note that a minor procedure has a zero-day or 10-day post-operative period.
• When a problem-focused E/M service is submitted on the same date of service, by the same professional provider or other qualified healthcare provider, with a preventive E/M.

In addition, Independence's notification indicates that when you're using modifier 25, "documentation for the additional E/M must be entered in a separate section of the medical record in order to validate the separate and distinct nature of the E/M service." Therefore, it appears that this payer will no longer allow you to document both the E/M and the procedure in the same sentence or paragraph of the note.

Note: The policy emphasizes that procedures without a zero-day or 10-day post op period, such as immunizations and vaccines, and their associated administration services, as well as EKGs and pulmonary function testing, are not considered minor procedures. So, the 50 percent modifier 25 reduction policy will not apply to them.

Pay Cuts Could Be Major

Seeing your pay fall by 50 percent for E/M services with modifier 25 appended could be a drastic change for practices. For example, when you report 99204 (Office or other outpatient visitfor the evaluation and management of a new patient, which requires these 3 key components: a comprehensive history; a comprehensive examination; medical decision making of moderate complexity ...), you normally collect about $166, based on the 2017 Medicare Physician Fee Schedule values. However, under the new Independence Blue Cross rules, that number will fall to just $83. Say you report 99204-25 twice a day at your practice - you've now lost $830 a week or close to $43,000 annually, from Independence Blue Cross Blue Shield.

"This policy is absurd," says Barbara J. Cobuzzi, MBA, CPC, CENTC, COC, CPC-P, CPC-I, CPCO,  AAPC Fellow and vice president at Stark Coding & Consulting LLC in Shrewsbury, New Jersey. Although the policy is not a broad CMS directive, it could begin to infiltrate other payers if practices affected by it don't act quickly.

"This could really affect the bottom-line of the practice," says Suzan Hauptman, MPM, CPC, CEMC, CEDC, AAPC Fellow, senior principal of ACE Med Group in Pittsburgh. "The patient's health and convenience are always considered by the providers, but once they start losing money when performing both services on the same day, they will have no other choice but to schedule the patient at a later date for the procedure."

Check This Example for Clarity

Consider the following example to illustrate how the Independence policy will impact practices.

Example 1: A patient presents with rectal bleeding. The physician performs a history, exam, and medical decision-making to assess the condition. He decides to perform an anoscopy or limited sigmoidoscopy to see if the bleeding is hemorrhoidal or of another source. Both services are complete and are distinct, and documented appropriately. If the payer reimburses the visit at 50 percent of the usual E/M fee, the practice may ask the patient to come back a second day for the procedure rather than having it done the same day as the E/M service - that would be the workaround to collecting the full fee for both services.

Consider this advice: If you have contracts with Independence Blue Cross Blue Shield, consider approaching your state medical society to see if this policy represents such a radical reinterpretation of contract terms that is not a legally allowable unilateral amendment without the payer getting permission from the state's department of insurance or other regulatory body. Some states have such regulations.

What this could do, according to Hauptman, is burden the patient with a return to the office.

"The physician wants to provide the best healthcare possible to his patients. However, cutting the reimbursement for these surgeries by 50 percent may not cover the expenses to perform them at that time," Hauptman says. "The E/M service that was performed in order to make certain the procedure is the best course of treatment should stand on its own merit when the procedure is performed. Applying the modifier 25 to that visit should clearly illustrate that the both services were performed in their entirety and should be paid accordingly."