Pathology/Lab Coding Alert

Despite the common perception that a clinical pathology consultation and the interpretation of a clinical laboratory test are one and the same, Medicare defines these as two separate and distinct types of physician services. To facilitate payment, you must know which clinical laboratory tests may involve a professional interpretation and how to report that service in the independent laboratory and hospital setting.

Bill for Interpretation of Diagnostic Tests

"A pathologist's interpretation of laboratory diagnostic tests is a professional service that is payable under the Physician Fee Schedule," says Kenneth Wolfgang MT (ASCP), CPC, CPC-H, member of the national advisory board of the American Academy of Professional Coders and director of coding and analysis for National Health Systems Inc., a coding consultation company in Camp Hill, Pa. Many CPT Codes for clinical laboratory tests describe the lab work (with pathologist oversight) involved in the test, which is payable under the Clinical Laboratory Fee Schedule (CLFS). "If a pathologist provides an interpretation of the test, the interpretation is separately billable," Wolfgang says.

"However, only 18 specific clinical lab tests are recognized by Medicare as frequently requiring interpretation," says Dennis Padget, CPA, FHFMA, president of Padget & Associates, a Kentucky-based pathology compliance-consulting firm. "Included are hemoglobin electrophoresis (83020), molecular diagnostics (83912), protein electrophoresis and Western blot (84165, 84181, 84182), immunoelec-trophoresis (86320-86327) and fluorescent noninfectious agent antibody tests (86255, 86256)." Section 15020-E of the Medicare Carriers Manual (MCM) contains the complete list.

Even for these 18 diagnostic lab tests, Medicare covers the pathologist's interpretation only if it meets three criteria:

1. The patient's attending physician requests the interpretation.

2. The interpretation is documented by a written narrative report included in the patient's medical record.

3. The interpretation requires the exercise of medical judgment by the pathologist. "CMS states that for this category of pathologist professional service, the standing order of a hospital's medical staff may be used as a substitute for the individual request by the attending physician," Padget says.

Coders must append modifier -26 (Professional component) to the appropriate lab code (e.g., 83020, 84165, 86320, 86334) to report the pathologist's interpretation of a clinical diagnostic test included in this list of 18 tests. The test is reported with the appropriate CPT code, such as 86334 (Immunofixation electrophoresis), and is payable under the CLFS; the pathologist's interpretation is reported as 86334-26 and is payable under the Physician Fee Schedule (PFS).

The National PFS Relative Value File (RVU02, available at www.hcfa.gov/stats/pufiles.htm) describes coding and reimbursement for pathologist interpretation of diagnostic tests. Column M is labeled "PC/TC indicator," and the code in that column gives information about reporting the professional and technical components of a service. A "6" is listed in column M for the 18 lab tests that allow an interpretation, meaning that the service is paid under the CLFS, but the pathologist may bill separately for an interpretation, if provided. Other lab tests that do not allow interpretations are listed with a "9" in column M, indicating that the concept of professional and technical component is not applicable.

Column B is labeled "modifier," and lists the modifier that must be used when reporting the service. For example, when column B shows no modifier for 85576 (Platelet; aggregation [in vitro], each agent), there is no payment under the PFS. However, when column B shows modifier -26 associated with 85576, the service represents the pathologist's interpretation and is paid.

"Unlike other pathology services, such as surgical pathology and specific cytopathology, hematology and blood banking codes, which entail a technical component and professional component payable under the PFS, the -TC (Technical component) modifier is not applicable for the 18 diagnostic lab test codes," Wolfgang says.

"Independent laboratories and hospitals bill differently for diagnostic lab tests with pathologist interpretation," Padget says. The independent lab is entitled to bill Medicare Part B for the lab test and the pathologist's hands-on interpretation of the test, whether the pathologist is an employee or independent contractor for the lab. For example, if an independent lab carries out protein electrophoresis tests with a pathologist interpretation, the lab should bill 84165 for the test, plus 84165-26 for the interpretation.

"For hospital-based services, two different billing entities and Medicare trust funds will be involved with billing for these services," Padget says. The hospital bills its Part A fiscal intermediary on the UB-92 form for the lab test, using an unmodified code such as 84165. But the pathologist bills his/her professional fee to the Part B carrier on the CMS 1500 form using modifier -26. "Even if the hospital employs the pathologist and bills for that physician's professional services, it must file the professional service claim with the Medicare Part B carrier on a CMS-1500, the same as if the pathologist were an independent practice physician," Padget explains.

Bill for Clinical Pathology Consultation

Clinical pathology consultations are reported with 80500 (Clinical pathology consultation; limited, without review of patient's history and medical records) or 80502 (... comprehensive for a complex diagnositc problem, with review of patient's history and medical records). "As with pathologist diagnostic test interpretation services, certain criteria must be met for Medicare to allow the consultation," Wolfgang says.

A clinical pathology consultation requires three of the same criteria as an interpretation: 1) the consultation not just the underlying lab test must be ordered by the patient's attending physician, 2) the consultant must issue a written report and 3) the consultation must require the exercise of medical judgment by the consulting physician. "However, a consultation must meet one additional criterion," Padget says. The fourth requirement is that the lab test result behind the consultation must lie outside the clinically significant normal or expected range in view of the patient's condition.

"Unlike the diagnostic lab interpretation service, CMS has outlawed standing orders as a way to fulfill the attending-physician-request criterion for a clinical pathology consultation," Padget says. "The medical record must contain a specific consultation request, such as 'lipid profile with pathologist consultation,' if the pathologist's 80500 or 80502 charge is to be upheld as valid."

Also, unlike the diagnostic lab interpretation service, the consultation does not require modifier -26. "Code 80500 or 80502 consultation is a professional-only service, meaning that it is billed to Part B by the pathologist or the independent laboratory and is compensated by the Physician Fee Schedule," Padget says. That is why these codes show a "0" in the PC/TC column M of the Physician Fee Schedule RVU02, indicating that the code represents only a physician service that is not subject to billing with -TC and -26. Correspondingly, there is no modifier listed in column B.

"The underlying lab test will also be billed separate from the consultation charge by the hospital on form UB-92 or the independent laboratory on form CMS 1500," Padget says. Medicare pays for the lab test from the CLFS unless the patient is an inpatient. An independent laboratory billing the lab test and the consultation should apply modifier -59 (Distinct procedural service) to the 80500 or 80502 code to denote that it is a separate service.

Beware of CCI Edits for Clinical Consultation

Medicare's national Correct Coding Initiative (CCI) edits are designed in part to detect instances when a laboratory or other healthcare provider is "unbundling" charges, meaning that two or more integral components of a single service are separately billed.

The latest version of CCI contains about 270 edit pairs that remind laboratory providers that it is not appropriate to bill limited or comprehensive clinical pathology consultation code 80500 or 80502 for pathologist direction, supervision and other oversight services in the laboratory. Codes 80500 and 80502 are designated in CCI as being bundled with the primary clinical laboratory test code in the case of:
 

all 18 lab tests approved by Medicare for pathologist interpretation of clinical lab tests

some lab panels, such as 80061 (Lipid panel)

evocative/suppression testing (80400-80440)

select chemistry codes, such as blood gases (82803-82820), fetal lung maturity tests (83661-83664) and molecular diagnostics (83890-83912)

many hematology and coagulation codes (85002-85999)

many immunology codes in the range 86000-86384

certain microbiology codes (87001-87999), including immunofluorescent techniques (87260-87300), nucleic-acid probes (87470-87799), and direct optical observation techniques (87810-87899) for infectious agent antigen detection

most cytogenetic studies (88230-88299).

Padget asserts that these claim edits are unnecessary. "The rules make it clear that neither a laboratory nor a pathologist can bill Medicare for medical direction, supervision and other Part A physician services. Doing so under the guise of an 80500 or 80502 clinical consultation would earn you a 'GO DIRECTLY TO JAIL' card!" he adds. "Notwithstanding the CCI edits, a professional fee by a pathologist for a consultation related to a clinical lab test is separately billable to Medicare and other payers when the service is provided and documented according to the criteria."

However, because these edits are in place, labs must be aware of them and code accordingly. "Independent laboratories are more impacted by these rules than hospitals, because of the billing entities involved," Padget says. "Because hospitals bill Part A for the clinical lab test, such as a lipid panel (80061), while pathologists bill Part B for the 80500 or 80502 consultation, there are no special coding needs for reporting these services."

On the other hand, independent laboratories must pay attention to the 80500 and 80502 bundling edits. "In this situation, one entity the independent lab is billing one entity Medicare Part B for the lab test and the consultation," Padget explains. "In the independent lab setting, modifier -59 must be used to override the CCI edit pair whenever a pathologist performs a clinical consultation for a lab test that is bundled with 80500 or 80502."