Physician Practice

Update: E/M pay cut tied to modifier 25 affects only certain payer plans

Physician Practice Insider, September 4, 2017

Some providers face a fee schedule cut of 50% for E/M services billed with modifier 25 (Significant, separately identifiable E/M service), but you’re in the clear unless you treat patients who carry insurance from Independence Blue Cross or one of its parent company’s other subsidiaries.

The reduced payment for E/M services applies under Medicare Advantage and private insurance plans offered by Independence Health Group and occurs when a provider’s office reports a minor procedure along with the 25-appended E/M code (PBN 7/17/17).

The reduced E/M payments do not apply to traditional Medicare and, at press time, Part B News was not aware of other Medicare Advantage carriers making the same policy change.

The mid-size health insurer operates in 25 states as well as the District of Columbia through its various subsidies, which include Independence Blue Cross, covering southeastern Pennsylvania, QCC Insurance Company, Keystone Health Plan East and AmeriHealth.

Medical coverage under one of Independence Health Group’s companies is available in more than 10 states, including Michigan, North Carolina and New Jersey 

(see resources, below, for a service map).

The change to E/M payments that became effective Aug. 1 runs counter to most payers, including Medicare, which reimburse 25-appended E/M services at 100% of the fee schedule. “The policy is consistent with Medicare’s reporting requirements,” states the policy update. However, “the company’s payment methodology may differ from Medicare.”

For practices that submit claims to an Independence carrier, those with modifier 25 appended to an E/M service will see a sizable pay cut when a minor procedure is reported as well. For instance, the $173 that you would normally see for annual wellness visit (AWV) code G0438 would get reduced to about $86 (all rates national, non-facility) when modifier 25 is tacked on.


Independence service map: 

This article was originally published in Part B News.

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