Otolaryngology Coding Alert

Even though audiology tests now bundle evaluation and management (E/M) services, both should be paid as long as documentation supports the significant, separately identifiable nature of the E/M and modifier -25 (significant, separately identifiable evaluation and management service by the same physician on the same day as another procedure or service) is appended.

HCFAs national Correct Coding Initiative (CCI) version 6.3 bundled E/M services to many diagnostic services, including all audiology tests. The edits were designed to prevent physicians from separately billing for the routine examinations performed before such services. The edits all include a 1 indicator, however, which means an appropriate modifier will override the edit and the local Medicare carrier should reimburse the physician for both services.

But otolaryngology practices in several regions across the country report that since the edits were announced, payment for the E/M service is being denied, even when a significant, separately identifiable E/M service is documented and billed with modifier -25 attached.

Despite HCFAs stated intent that carriers should publish the edits (and, presumably, the guidelines for the correct use of modifier -25) in their bulletins before the edits were implemented, this does not seem to have occurred in some jurisdictions.

Essentially, carrier responses can be placed in one of four categories:

1. Outright refusal to pay for the E/M service, regardless of modifiers, or insinuation that modifier -25 claims will be closely monitored;

2. Denial unless modifier -59 (distinct procedural service) is used;

3. Denial with modifier -25 unless two separate diagnoses are provided for the E/M and the audiology test(s); or

4. Payment for both services if modifier -25 is appended to the E/M service.

Appeal Denied Claims

Any response other than the last is inappropriate and should be vigorously appealed to the highest level, says Barbara Cobuzzi, MBA, CPC, CPC-H, an otolaryngology coding and reimbursement specialist and president of Cash Flow Solutions, a physician billing firm in Lakewood, N.J.

This is not a matter of opinion or carrier discretion, Cobuzzi says, noting that local Medicare carriers are mandated to observe CCI edits. Unfortunately, she notes, when CCI published the edits, additional information was not provided on why the edits were made or how to override them.

That information can be found in the Nov. 2, 1999, Federal Register, which clearly states that edits would be introduced to prevent pretest evaluations already included in the test from being billed separately. The same item also instructs physicians to use modifier -25 to indicate that a significant, separately identifiable E/M service was provided on the same day as the test.

When appropriate E/M services are denied because the carrier considers them bundled into the audiology tests, Cobuzzi recommends that otolaryngologists include in their appeals as much authoritative documentation as possible, particularly relevant portions of Section H of the Nov. 2, 1999, Federal Register, which state the following:

Currently, the global surgery payment policies described in section 4820 of the Medicare Carriers Manual apply to procedures that have global periods of 0, 10, and 90 days as shown on the physician fee schedule database. We proposed to apply these policies also to those services and procedures for which the global period indicator is XXX [emphasis added]. Currently, it is only when a significant, separately identifiable E/M service is furnished before furnishing a procedure with a global period of 0, 10, or 90 days that the E/M service may be paid in addition to the procedure. The coding mechanism for indicating that the E/M service is not related to the surgical procedure is to append modifier -25 to the E/M service code.

We proposed that, for selected procedures that have a global period indicator of XXX, when a significant, separately identifiable E/M service is furnished at the same time by the same physician, the physician must append to the E/M service code the modifier -25 [emphasis added].

The basis for this policy is that, because every procedure has an inherent E/M component, for an E/M service to be paid separately, a significant, separately identifiable service would need to be documented in the medical record [emphasis added]. In other words, we want to prevent the practice of physicians reporting an E/M service code for the inherent evaluative component of the procedure itself.

The Federal Register also stated that the new policy will assist carriers in claims adjudication and eliminate unnecessary denials [emphasis added] when practitioners append modifier -25 to the E/M service to signify that the E/M service reported is appropriate because it was a significant and separately identifiable service from the procedure performed.

Note: The Nov. 2, 1999, Federal Register can be downloaded from the HCFA Web site at: www.hcfa.gov.

Modifier -59 for Procedures Only

Although modifier -59 was developed to override carrier edits, it should not be used to unbundle E/M services because it applies to procedures only, says Susan Callaway, CPC, CCS-P, an independent coding and reimbursement specialist and educator in North Augusta, S.C.

This should be a no-brainer for carriers, Callaway says. Not only does the Federal Register explicitly state that significant, separately identifiable E/M services are to be reported using modifier -25, but CPT clearly states that modifier -59 applies to procedures not other services that are distinct. Furthermore, modifier -25 has long been recognized as the correct modifier for E/M services performed on the same day as a procedure.

She notes that carriers that have denied E/M services performed before audiology tests and appended with modifier -25 have yet to formulate and publish policies or guidelines on this issue, and she suspects that uninformed clerks employed by the carriers may be giving out bad information.

Theres an old joke that if you call the carrier three times youll get four different opinions, and that seems to be whats going on here, Callaway says. In the Federal Register, HCFA makes it plain that the edits added to the CCI could be overriden by using modifier -25. Its clearly stated reason for doing so is so that the same guidelines that govern modifier -25 use for E/M services performed on the same day as procedures with global periods will apply also to tests. And local carriers dont have the right to unilaterally ignore the regulations regarding CCI edits, which are part of their mandate.

Two Diagnoses Usually Arent Required

Most Medicare carriers have long accepted one diagnosis code linked to both a procedure and an E/M service provided on the same day, as long as the physicians documentation clearly indicates that the visit was significant and was responsible for the decision to perform the procedure.

The same reasoning should apply to E/M services performed on the same day as a test, says Randa Blackwell, a coding and reimbursement specialist with the department of otolaryngology at the University of Maryland in Baltimore. A second diagnosis, although helpful, is neither necessary nor always available, particularly when E/M leads to the decision to perform the procedure.

Some carriers, however, such as Empire Medical Services, the Medicare Part B carrier in New Jersey and parts of New York, now require separate diagnoses for the tests and the E/M, says Lee Eisenberg, MD, an otolaryngologist in Englewood, N.J., who is a member of CPTs editorial panel and executive committee. Eisenberg, who has taken up the matter with HCFA, says the underlying issue should not be the second diagnosis.

Cobuzzi agrees: The number of diagnoses is not the determining factor. Its whether you can prove the test wasnt planned or scheduled.

If the test was preplanned and the visit is a routine pretest evaluation only, an E/M service shouldnt be charged. But if the history, examination and medical decision-making was significant and directly led to the decision to perform the procedure, or if the procedure is part of the patients workup, it may be payable.

Authoritative documentation supports the need for only one diagnosis, Cobuzzi says, noting that in 1999, CPT revised the definition of modifier -25 specifically to align it with HCFAs view that different diagnoses are not necessary to use modifier -25.

The CPT citation states: The physician may need to indicate that on the day a procedure or service identified by a CPT code was performed, the patients condition required a significant, separately identifiable E/M service above and beyond the other service provided or beyond the usual preoperative and postoperative care associated with the procedure that was performed. 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 [emphasis added].

The November 1998 issue of CPT Assistant further supports this assertion, explaining, The descriptor for modifier -25 has been revised to clarify that since the E/M service may be prompted by the symptom or condition for which the procedure and/or service was provided, different diagnoses are not required for reporting of the E/M services on the same date.

Note: CPT books prior to 1999 did not explicitly state that two separate ICD-9 codes had to be used.

For example, an established patient with serous otitis media comes in for followup. The otolaryngologist performs a low-level E/M (99212, office or outpatient visit of an established patient), but is unsure if the patients condition has cleared and therefore performs audiometry (92557, comprehensive audiometry threshold evaluation and speech recognition) and a tympanogram (92567, tympanometry [impedance testing]).

Modifier -25 should be appended to 99212 to indicate the exam was significant and separately identifiable because it led to the decision to perform the test. Code 99212, as well as the 92557 and 92567 (neither of which requires modifier -25) are linked to the same serous otitis diagnosis code (381.10, chronic serous otitis media, simple or unspecified).

Even if the test confirms the problem has abated, the same ICD-9 code can be used, because it is the reason the patient came to see the otolaryngologist, Cobuzzi says.

Using one diagnosis both for audiologic testing and the E/M service that led to the decision to perform the test occurs far more frequently with established patients than with new patients. Typically the new patient is not diagnosed and the otolaryngologist can use a sign or symptom code for the E/M and the post-test diagnosis (for example, serious otitis media) for the test if the results are positive.

In many situations, however, a single diagnosis may suffice for new patients. For example, a new patient may already be diagnosed with serous otitis media but the otolaryngologist believes there may be hearing loss and performs comprehensive audiometric testing (92557) to determine if the ear drum is functioning normally. The results are negative, therefore the serous otitis ICD-9 code should be used for both services, with modifier -25 attached to the appropriate level of E/M.

Similarly, the otolaryngologist seeing a new patient with Mnires disease often performs both E/M and audiologic testing as part of a complete workup. In such cases, the E/M performed is likely to be extensive, but audiologic testing is also required to evaluate the patients vertigo and determine how well the patients auditory system is functioning. The same ICD-9 code (386.00, Mnires disease, unspecified [active]) would be used for the E/M and the test, both of which should be payable.

Other Problems and Possible Remedies

Because there is so much confusion among Medicare carriers regarding the new edits in the CCI, otolaryngologists should be prepared to appeal E/M denials to the highest level. Meanwhile, physician groups such as the American Academy of Otolaryngology Head and Neck Surgeons (AAO-HNS), which has been deluged with complaints by otolaryngologists in various Medicare jurisdictions, has sent an alert to its members.

Although the vast majority of the reports of inappropriate edits relate to audiologic testing, many other diagnostic services now also bundle E/M, including but not limited to codes for the following services:

Some radiological supervision and interpretation codes that involve the ear, nose, throat, head and neck;
Operating microscope in the office;
Nasopharyngoscopy;
Nasal, facial nerve, and laryngeal function studies;
Evaluation and treatment of swallowing and oral function;
Vestibular and audiologic function tests;
Airway obstruction treatment;
Continuous positive airway pressure (CPAP) initiation;
Allergy testing (but not allergen immunotherapy);
Sleep testing; and
Speech testing.

In the meantime, coding specialists urge otolaryngologists and their coders to familiarize themselves with the CCI. Even more importantly, otolaryngologists should bill only for procedures and services performed and supported by documentation, particularly in view of reports that some carriers are alerting physicians that the use of modifier -25 in such cases will be closely monitored (which some otolaryngologists have construed as a thinly veiled audit threat). Such practices are crucial, carriers argue, given the absence of a binding nationwide policy to accept modifier -25 in such cases.