Pathology/Lab Coding Alert

Show medical necessity with ‘screening,’ ‘status,’ and more.

If you shun reporting ICD-10 “Z” codes because you think they’re only secondary or supplementary codes, think again.

Formally referred to as “factors influencing health status and contact with health services,” Z codes can actually be the key to unlocking payment for many lab and pathology procedures. Read on to let our experts demystify when and how you might use these codes for your lab claims.

Keep Z Codes in Their Place

Z codes describe various situations that impact the reason for a patient encounter or test, such a screening for disease, testing based on exposure to something that could adversely affect health, or genetic carrier status, to name a few. Because those things may seem ancillary, many coders wonder how to accommodate the information in the larger context of ICD-10 reporting.

Here’s how: “It is appropriate to code all diagnoses that co-exist at the time of the visit that affect patient treatment or management—this includes status conditions (Z codes),” says Matthew Menendez, vice president of sales and marketing with White Plume Technologies in Birmingham, Ala.

Myth-buster: Despite that sound advice, many coders shy away from reporting a Z code alone or as the first diagnosis. “From a billing point of view, you may use Z codes as either a first-listed (principal diagnosis) or secondary code, depending on the circumstances for the services being provided,” affirms Elisa Bovee, Senior Vice President of Operations, Harmony Healthcare International (HHI) in Topsfield, Mass.

In fact, lab and pathology coders face a lot of situations that might require reporting Z codes. Missing those cases can mean not demonstrating medical necessity for a service — and that means missing payment.

Let’s look at several common situations when your lab or pathology practice may need to report Z codes to appropriately document the patient’s condition and reason for testing.

Identify Screening-Test Encounter Codes

If your lab performs testing in “well” individuals to facilitate early detection of disease, you’ll need to turn to Z codes to describe the reason for the test. Don’t use these codes if the patient shows any signs or symptoms of the disease you’re evaluating — you should instead code signs or symptoms when those exist.

Many times you receive a patient specimen to perform a screening test, and that’s one time you should report only the appropriate health-status ICD-10 code. “Z codes are allowed as primary codes when they are the best description for the main reason a patient is being seen,” says Judy Adams, RN, BSN, HCS-D, AHIMA approved ICD-10-CM Trainer, with Adams Home Care Consulting in Asheville, N.C.

For instance: The lab examines a Pap smear taken once every three years for a patient who has no signs or symptoms of disease. Ordering a screening test means the patient has no known current problems or past history of abnormal Pap results or cervical disease, explains Melanie Witt, RN, CPC, MA, an independent coding expert based in Guadalupita, N.M.

You should report a Z code (such as Z12.4, Encounter for screening for malignant neoplasm of cervix) when your lab performs a screening test like P3000 (Screening Papanicolaou smear, cervical or vaginal, up to three smears, by technician under physician supervision). Medicare requires a Z code to indicate medical necessity for screening Pap smears.

See Table 1 on page 29 for a list of common screening codes that you might encounter in your lab.

Distinguish ‘History’ and ‘Status’ Codes

ICD-10 includes Z codes that indicate when a patient has a personal or family history of illness that may impact current healthcare decisions, even though the patient doesn’t currently have the illness. You’ll often use personal history codes with codes for followup after disease treatment is complete. You might use family history codes with screening codes to explain the need for a test or procedure.

Two history categories that frequently affect lab coding include Z80 (Family history of primary malignant neoplasm) and Z85 (Personal history of malignant neoplasm).

For instance: If the lab performs a PSA test (such as 84153, Prostate specific antigen [PSA]; total) more than a year after successful treatment for a prostate cancer patient, you should not use a prostate cancer diagnosis (C61, Malignant neoplasm of prostate). Instead, you should report Z85.46 (Personal history of malignant neoplasm of prostate). Mislabeling the patient as an active cancer patient could affect his ability to get health or life insurance or affect his treatment by other physicians for other conditions.

Status: ICD-10 also provides “status” Z codes, which indicate that the patient currently has some circumstance that influences the patient’s health status, but is not in itself a current illness or injury. You should distinguish these from history codes, which refer only to conditions that the patient does not have.

For example: An otherwise healthy patient taking Celebrex for her arthritis undergoes lab tests every few months to monitor kidney and liver functions. In this case, a Z code that shows the patient is on a drug long term, such as Z79.1 (Long term [current] use of non-steroidal anti-inflammatories [NSAID]), will help to substantiate medical necessity for these tests. Without this code, you may expect denials for the testing.

These “status” codes also indicate circumstances such as genetic carrier status (for example, Z14.1, Cystic fibrosis carrier), drug resistance, and more. See Table 1 for a list of common status codes that might impact your lab coding.

Recognize ‘Exposure’ and More

Sometimes a patient has had known or suspected exposure to potentially hazardous substances or infectious organisms. ICD-10 provides two categories to capture these circumstances: Z20 (Contact with and [suspected] exposure to communicable diseases) and Z77 (Other contact with and [suspected] exposures hazardous to health) such as chemicals.

Labs will most likely use these “contact with and (suspected) exposure” codes as a first-listed code to explain an encounter for testing. Coders may also use these codes as a secondary diagnosis to identify a potential risk.

Aftercare: When a person with a known disease or injury encounters the healthcare system for a specific treatment, your lab might need to use an “aftercare” Z code such as Z49.3- (Encounter for adequacy testing for dialysis).

Other types of Z codes your lab might occasionally face include testing for an organ donor, which you would report with an appropriate code such as Z52.3 (Bone marrow donor) to identify the need for the tests.

In fact, you must use most codes from category Z52 (Donors of organs and tissues) as the primary diagnosis. “There are a few Z codes that can be used only as first-listed diagnoses,” states Dee Mandley, RHIT, CCS, CCS-P, president of D. Mandley & Associates, LLC in Stow, Ohio. You can find these at the ICD-10-CM Official Guidelines for Coding and Reporting Section 1; C; 21; 16, found at www.cms.gov/Medicare/Coding/ICD10/Downloads/2017-ICD-10-CM-Guidelines.pdf.