Pathology/Lab Coding Alert

Question: Our pathologists sometimes perform a fine needle aspiration (10021) on a superficial breast mass. Medicare has sent the following denial message: "Our records indicate that you billed diagnostic test(s) subject to price limitations; however, you did not indicate whether the tests were performed by an outside entity or if no purchased tests are included on the claim." How should we code this?

Idaho Subscriber

Answer: You didn't state if these are independent pathologists, or if the FNA is performed for hospital inpatients or outpatients, but the message you describe often involves "purchased" tests. When a provider purchases the technical or professional component of a diagnostic test and passes on the charge, Medicare has established billing limits and does not allow the purchasing provider to charge a markup.

Box 20 of form CMS 1500 is reserved to identify diagnostic tests purchased from a laboratory or diagnostic facility and to list the amount paid for the services to ensure compliance with Medicare's limits. The provider must also use Box 32 of CMS 1500 to list the name, address and CLIA certification number of the institution from which the test is purchased.

Medicare's Physician Fee Schedule lists a technical and professional component for the FNA codes (10021, Fine needle aspiration; without imaging guidance; and 10022, with imaging guidance), indicating that the physician doesn't always provide the technical component, e.g., the cost of the needle and supplies for smear preparation. If the pathologist performed the entire procedure and provided the supplies, bill 10021 without a modifier when billing the same entity for both the technical and professional components (global service).

If performing the FNA in a hospital or facility where you are not responsible for the technical component, bill 10021 with modifier -26 (Professional component). In either case, check "No" in box 20 and you should receive payment.