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Obtain maximum allowable reimbursement with the appropriate use of modifiers

HIM Connection, February 28, 2003

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Dear Colleagues:

In the January 3, 2003 "Medicare Program Memorandum Intermediaries," Transmittal Number A-02-129, CMS publishes four new modifiers that hospitals are required to report when applicable, for Medicare hospital outpatient cases.

In order for a hospital to receive payment for a CPT code on the Medicare Inpatient Only List that is billed with modifier -CA, all of the following conditions must be met:

• The status of the patient is outpatient;
• The patient has an emergent, life-threatening condition;
• A procedure on the inpatient list (designated by payment status indicator C) is performed on an emergency basis to resuscitate or stabilize the patient;
• The patient dies without being admitted as an inpatient.

A CPT or HCPCS Level II modifier provides the means to indicate that a service or procedure that has been performed has been altered by some specific circumstances, but has not changed in its definition or code. The proper use of modifiers reduces the need for separate procedure listings to describe the modifying circumstance. Modifier codes can be reported as two-digit modifier placed after the procedure code. For example, modifier -50/bilateral procedure can be attached to code 49505 to report a bilateral inguinal hernia repair (this is the format required for hospital outpatient services). Healthcare Common Procedure Coding System (HCPCS) Level II modifiers (e.g., LT for left side) also may be used with a CPT code.

Modifiers are required to meet at least one of the following criteria:

• payment implications
• future need for payment data for constructing an outpatient prospective payment system (PPS)
• coding consistency and editing.

This week's HIM Connection was adapted from the book The Modifier Clinic: A Guide to Hospital Outpatient Issues. The book offers practical advice, exercises and case studies to help you obtain maximum allowable reimbusement with the appropriate use of modifiers. It also reviews Medicare's official guidelines for reporting modifiers on outpatient claims. It addresses operational issues associated with modifier reporting using practical exercises, case studies, and detailed figures. For more information, or to order your copy, Click here.

Sincerely, Kim Raines Managing Editor

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