Health Information Management

Review common RAC issues and correct potential coding errors

JustCoding News: Outpatient, February 24, 2010

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by Stephanie Ellis, RN, CPC

As permanent Recovery Audit Contractor (RAC) program activity continues to increase across all 50 states, many providers are bracing themselves for a possible onslaught of medical record requests. One strategy to protect your organization in the event of an audit is to take the time to understand some of the issues multiple RACs have identified for review.

First, it’s important to understand that there are two types of RAC audits:

  • Those which focus on Medicare payments made on claims that violate some type of Medicare policy
  • Those that focus on Medicare payments made which were the responsibility of another payer (e.g., Medicare secondary payer violations)

A look at a sample of RAC issues approved for review

Physician practices, mental health providers, and other Part B providers will need to focus on how they complete their claim forms for the following services:

  • Blood transfusions. When billing CPT codes 36430, 36440, 36450 and 36455, coders should only list a 1 in the units column on the claim form, regardless of the number of units of blood transfused, as these codes are meant to indicate that one transfusion is being given during the visit with the provider.
  • Clinical social worker (CSW) services. When rendered to Medicare patients during an inpatient hospital stay, CSW services are not separately payable by Medicare Part B, as these services are already paid as part of the hospital stay. The CSW needs to look to the hospital for payment rather than submit to Medicare a separate claim for services.
  • Untimed codes. When Part B providers bill CPT codes for procedures that are not defined by a specific timeframe, providers should only list a 1 in the units column on the claim form. For example, CPT code 31256 (Nasal/sinus endoscopy, surgical, with maxillary antrostomy) is an example of an untimed code and code 76000 (Fluoroscopy [separate procedure], up to one hour physician time, other than 71023 or 71034 [e.g., cardiac fluoroscopy]) is an example of a timed CPT code.
  • IV hydration therapy. When reporting CPT code 96360 for intravenous infusion, hydration; initial, 31 minutes to one hour (previously coded 90760 for dates of service prior to January 1, 2009), providers should only list a 1 in the units column on their claim forms. Do not bill code 96360 with varying number of units on the claim based on the number of minutes the procedure lasted or the number of IV bags used. Coders should report code 96360 for 31–60 minutes of IV therapy time and bill with 1 unit, and if the time took an additional hour, use code 96361 (each additional hour) with 1 unit. When the IV therapy takes fewer than 30 minutes, it is not billable.
  • Bronchoscopy procedures. When billing codes 31625, 31628 and 31629, providers should only list a 1 in the units column on the claim form. Bill these biopsy codes once with 1 unit on the claim, regardless of the number of biopsies the physician takes during the procedure.
  • Once in a lifetime procedures. With the exception of codes billed with modifier -58 (Staged procedure), procedures that can be performed only once in a person’s lifetime (e.g., hysterectomy) are billed more than once, these will be subject to review.
  • Pediatric codes exceeding age parameters. For example, consider circumcision code 54160, which is defined as performed on a “neonate of 28 days of age or less.” Thus, if a 3-month-old infant undergoes this procedure, you should instead use code 54161 (Circumcision, surgical excision other than clamp, device, or dorsal slit; older than 28 days of age).
  • Neulasta injections. When billing code J2505 for an injection, Pegfilgrastim 6 mg, it is important that the number of units providers bill on the claim form represents the number of multiples of 6 mgs administered—not the total number of mgs given.
  • Global vs. -TC/-PC modifiers. Providers need to append the appropriate modifiers to CPT codes. This means reporting the technical component modifier (i.e., -TC) for the equipment ownership and the staff resources to perform certain services (e.g., x-rays) as well as the professional component modifier (i.e., -26) for the physician or other provider’s role (e.g., interpretation) when billing and reporting those services. When billing CPT codes without modifiers, you are billing globally for both the professional and technical components of the test.
  • Facility vs. non-facility reimbursement. This audit issue involves place of service (POS) errors on claim forms. When physicians perform a surgery at a hospital or ambulatory surgery center (ASC), use POS 21, 22, or 24 (as appropriate) on these claims rather than POS 11 to indicate an office as the place of service. When physicians perform surgical procedures at their offices, they are reimbursed at a higher rate than when they are performed at the hospital or ASC. Therefore, incorrect POS reporting can potentially result in fraudulent claims.
  • Anesthesia care package and evaluation and management (E/M) services. Anesthesiology services include an E/M component for the assessment of patients for anesthesia the day before and day of the surgery. Therefore providers should not bill a separate E/M code unless the E/M service is unrelated to the anesthesia for the procedure. Anesthesiologists do not usually work up a totally separate condition or problem with a different diagnosis when they are discussing surgical anesthesia and taking the patient history before surgery, so it would be unusual to need to bill a separate E/M code (e.g., 99203, 99214).
  • New patient status for E/M code billing. Providers should bill E/M codes for new patients only when the patient has not seen the physician or any other physician of the same specialty in the group practice for three years.
  • National Correct Coding Initiative edit violations. Some CPT codes are billable using modifier -59 when they are unbundled to indicate that the physician performed them at a different site or organ system, though a separate incision/excision, in a separate compartment, or involving a separate lesion. Unbundled procedures not billable with modifier -59 are a focus issue for all the RACs. Consider the following.

    When a surgeon performs an arthroscopic subacromial decompression (code 29826-59-RT) with an open rotator cuff repair (code 23412-RT), this is separately billable. However, an example of an unbundled procedure that coders should not bill separately with a modifier -59 would be when a physician performs a retrograde pyelogram (code 52005-RT, which is unbundled) on the same ureter where the physician removes a ureteral stone. Code 52320-RT is the only billable code.

Stay on top of regulations and record requests

Keep up with Medicare regulations and policies as they are published, and follow those that are applicable to services you provide.

When you receive requests for information from Medicare or a RAC, be cooperative, treat them seriously, work within the timelines requested, and respond fully to these requests.

Now is the time to prepare and make sure you are doing things right—before Medicare RACs do it for you and try to take back your hard-earned money!

Editor’s note: Stephanie Ellis, RN, CPC, is the president of Ellis Medical Consulting, Inc., in Brentwood, TN. E-mail her at

For more expert analysis on the newly approved DRG validation issues, access the Revenue Cycle Institute Web site. To stay on top of the latest RAC-approved issues in your state, visit the “Tools” section of the Revenue Cycle Institute Web site and download the updated chart at the top of the page.

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