Your guide to better coding

May 16, 2008

Coding modifiers are often underused, misused, or submitted without supporting documentation. Here's how to end these costly mistakes.

Physicians have little control over the reimbursement rates they receive from Medicare and other third-party payers, which often bear little resemblance to the fees the doctors charge. To make matters worse, many physicians fail to bill insurers for all the work they do. The problem often stems from unfamiliarity with the nuances of coding. Errors involving modifiers-a "nuance" whose misuse can lead to claim denials or delays-often result in loss of time as well as revenue and interfere with your ability to deliver timely, cost-effective care.

These two-digit qualifiers, affixed as appendages to CPT codes, tell third-party payers that the patient required something outside the norm: an extra service, a duplicated service, or a service not connected to the primary reason for the patient visit.

But you need to use modifiers judiciously. In addition to the sheer financial impact, overuse, underuse, or incorrect use can lead to intense scrutiny from insurers and, ultimately, to an Office of Inspector General audit. In fact, the OIG Work Plan for 2008 focuses on a number of modifiers as part of the Department of Health and Human Services' ongoing efforts to eliminate coding fraud and abuse.1

When is a modifier necessary? Under what circumstances should it be used?

Basically, a modifier appended to a CPT code indicates that:

If you use them correctly, modifiers eliminate the appearance of duplicate billing or unbundling, add information about the anatomic site of a procedure, or provide additional information about a service provided.3

Important as modifiers are, it's not sufficient to affix the right one to the correct CPT code. In order to be reimbursable, a claim has to "tell the story." It must include the documentation to support it. Yet it's not uncommon for physicians' notes never to make it from the medical record to the encounter form.

An OIG review, reported in 2006, found a 35 percent error rate for modifier –25 (significant, separately identifiable evaluation and management service) and a 40 percent error rate for the use of modifier –59 (distinct procedural service). In one-fourth of the modifier –59 claims reviewed and one-third of the claims using modifier –25, documentation was omitted or incomplete.4 Use of these modifiers has been on OIG's radar screen ever since.

Modifiers –25 and –59: How to get them right

This whimsical memory aid could help you remember the most important thing about modifier –25: "If you don't have a HEM, you can't bill an E&M." 5 HEM, of course, stands for history, exam, and medical decision-making.

Consider this example of the right application of –25: A mother brings in a baby for a well visit, but reports that he's been wheezing. She describes symptoms suggestive of asthma, which will require extra history-taking and additional time to examine and treat. You perform the physical exam and ask appropriate developmental questions for the well-child visit (99391 for a 6-month-old), administer whatever vaccines are needed (using their individual CPT codes and the vaccine administration codes), and document the entire well visit. You would then write a separate note reflecting the history-taking, physical exam, and treatment prescribed specifically for the asthma, and sign that note as well.