Pathology/Lab Coding Alert

The organizational structure of your practice or lab is key to determining how to bill properly for the technical and professional components of pathology procedural codes , advises Cheryl Schad, BA, CPC, a member of the National Advisory Board of the American Association of Professional Coders.

You have to understand the organizational relationship between the pathologist and the lab, she explains. Coders without a clear picture of that relationship will find it difficult to sort out when to bill globally or separately, using the -26 modifier for the professional component or the -TC or other appropriate modifier for the technical component.

The Health Care Financing Administration (HCFA) says the professional component to any medical service includes the physicians work and overhead expenses involving three types of services:

1. physician interpretation of diagnostic tests;
2. diagnostic and therapeutic radiology; and
3. physician pathology services.

The technical portion includes the cost of equipment and supplies, as well as technician labor involved in completing the work. For example, surgical pathology code 88305 (gross and microscopic examination) would include a technical component that accounts for materials and labor involved in slide preparation, and a professional component that accounts for the pathologists examination of the specimen and the slides.

For medical procedures that include technical and professional components, unmodified CPT codesdescribe both portions, according to Schad, who also is president of Schad Medical Management, a Mullica Hill, N.J., physician reimbursement and consulting firm that specializes in pathology, radiology and family practice. Taken together, the professional and technical parts are referred to as the global service. If the same provider performs both parts of the service, the CPT code describing the service should be reported without modifiers, says Schad.

But thats often not the case for pathology services, she continues. Very often, the laboratory owns the equipment, purchases the supplies, and pays the personnel involved in pathology testing, while an independent pathologist interprets the tests.

For example, if a pathologist consults for a hospital lab and receives referred tissue samples for an opinion on a neoplasm, the appropriate CPT code would be 88323 (consultation and report on referred material requiring preparation of slides). The labs histotechnician would prepare slides using lab resources, and the pathologist would interpret the slides and write a report. The pathologist in this example would report code 88323 using the CPT modifier -26 (professional component)to indicate that he or she provided only the interpretive portion of the service, advises Schad.

To report the histotechnicians salary and lab supplies used in preparing the slides, the laboratory in this example would also report 88323, modified to claim only the technical component of the service. [...]