Understanding the Multiple Procedure Rule
When providers report more than a single (non-evaluation and management) procedure during a single encounter, payers typically will reimburse only the highest-valued procedure at full fee schedule value, and will reduce payment for the second and subsequent procedures. This occurs because payers reason that many of the component services that comprise the physician’s work (such as surgical approach and closure) should be paid only one time, per session. Chapter 1 of the National Correct Coding Initiative (NCCI) Policy Manual explains:
Most medical and surgical procedures include pre-procedure, intra-procedure, and post-procedure work. When multiple procedures are performed at the same patient encounter, there is often overlap of the pre-procedure and post-procedure work. Payment methodologies for surgical procedures account for the overlap of the pre-procedure and post-procedure work.
This is the basis for the “multiple procedure rule,” under which Medicare pays a reduced amount for the second and subsequent procedures performed during the same session. The amount of the reduction (if any) is determined by the indicator within the “Multiple Procedure” column of the Physician Fee Scheduled Relative Value file:
0=No payment adjustment rules for multiple procedures apply. If procedure is reported on the same day as another procedure, base the payment on the lower of (a) the actual charge, or (b) the fee schedule amount for the procedure.
1=Standard payment adjustment rules in effect before January 1, 1995 for multiple procedures apply. In the 1995 file, this indicator only applies to codes with a status code of “D”. If procedure is reported on the same day as another procedure that has an indicator of 1, 2, or 3, rank the procedures by fee schedule amount and apply the appropriate reduction to this code (100%, 50%, 25%, 25%, 25%, and by report). Base the payment on the lower of (a) the actual charge, or (b) the fee schedule amount reduced by the appropriate percentage.
2=Standard payment adjustment rules for multiple procedures apply. If procedure is reported on the same day as another procedure with an indicator of 1, 2, or 3, rank the procedures by fee schedule amount and apply the appropriate reduction to this code (100%, 50%, 50%, 50%, 50% and by report). Base the payment on the lower of (a) the actual charge, or (b) the fee schedule amount reduced by the appropriate percentage.
3=Special rules for multiple endoscopic procedures apply if procedure is billed with another endoscopy in the same family (i.e., another endoscopy that has the same base procedure). The base procedure for each code with this indicator is identified in the Endobase field of this file. Apply the multiple endoscopy rules to a family before ranking the family with the other procedures performed on the same day (for example, if multiple endoscopies in the same family are reported on the same day as endoscopies in another family or on the same day as a non-endoscopic procedure). If an endoscopic procedure is reported with only its base procedure, do not pay separately for the base procedure. Payment for the base procedure is included in the payment for the other endoscopy.
4=Special rules for the technical component (TC) of diagnostic imaging procedures apply if procedure is billed with another diagnostic imaging procedure in the same family (per the diagnostic imaging family indicator, below). If procedure is reported in the same session on the same day as another procedure with the same family indicator, rank the procedures by fee schedule amount for the TC. Pay 100% for the highest priced procedure, and 75% for each subsequent procedure. Base the payment for subsequent procedures on the lower of (a) the actual charge, or (b) the fee schedule amount reduced by the appropriate percentage. The professional component (PC) is paid at 100% for all procedures.
9=Concept does not apply.
Multiple procedure rule does not apply to all CPT® codes. Payers should never reduce payment for:
• Significant, separately identifiable E/M services provided on the same day as other procedures/services and properly appended with modifier 25 Significant, separately identifiable evaluation and management service by the same physician or other qualified health care professional on the same day of the procedure or other service
• Any designated “add-on” CPT® code (listed with a “+” next to the descriptor)
• Any procedure designated by CPT as “Modifier 51 exempt,” which may be identified in the CPT codebook by a “circle with a slash” next to the code.
You can find a full list of “add-on” and “modifier 51” exempt procedures in Appendices D and E of the CPT® codebook. The relative values assigned to these codes factor in the “additional” nature of the procedure/services; therefore, there is no justification to reduce reimbursement when these codes are reported in addition to other procedures.
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