Pathology/Lab Coding Alert

Reader Questions:

Do This to Ensure Mole Exam Pay

Published on Fri Aug 16, 2024

Question: Our pathologist diagnosed a skin specimen from the patient’s right cheek as a benign melanocytic nevi. Medicare denied the pathology service. What can we do to get this covered?

Alabama Subscriber

Answer: Medicare doesn’t cover cosmetic mole removal, so unless the ordering physician provides a medically necessary reason for the excision and subsequent pathology exam, you may have a hard time getting this covered with a diagnosis of D22.39 (Melanocytic nevi of other parts of face).

Medical necessity: If the ordering physician documents that the skin lesion demonstrates condition(s) such as bleeding, pain, itching, inflammation, oozing, or rapid growth or changes, you should report the appropriate symptom(s) to indicate that the procedure is not simply cosmetic. Also, if you provide documentation that the mole interferes with daily functions, such as obstructing vision or breathing, Medicare will cover removal.

ABN: Without medical necessity documentation, you should be able to get paid for your work if you have a signed advance beneficiary notification (ABN). The form must be on file before the procedure occurs, because it allows the beneficiary to refuse the procedure or agree that they’ll be responsible for payment if coverage is denied.

Modifier: If you have a signed ABN, you should list the procedure code 88305 (Level IV - Surgical pathology, gross and microscopic examination… Skin, other than cyst/tag/debridement/ plastic repair…) with modifier GA (Waiver of liability statement issued as required by payer policy, individual case). Without a signed ABN, you should use modifier GZ (Item or service expected to be denied as not reasonable and necessary), which means you cannot bill the patient for the service.

Update: As of June 30, 2024, you should be using the latest ABN version, which is CMS-R-131 with an expiration date of Jan. 31, 2026.