Part B Insider (Multispecialty) Coding Alert

Published on Fri Jun 24, 2005 PDF

If you substitute Category III or unlisted-procedure codes with existing, but inexact, CPT codes for fear of inadequate reimbursement, beware: Failure to use the most accurate code, reimbursable or not, will result in denials and squelch all possibility for pay.

Alternative: You can coach your carrier in developing reasonable RVUs  [relative value units] for unlisted-procedure and Category III codes with these three expert-approved steps.

Category III codes are temporary codes for emerging technology, services, and procedures that allow the Centers for Medicare and Medicaid Services (CMS) to collect data on the use of these new services, an ability unlisted codes do not possess. If a Category III code for a service exists, you must report the Category III code and not an unlisted Category I (CPT) code.

Steer Your Insurers in This Payment Direction

"Insurers struggle with developing RVUs for Category III and unlisted codes, but if you provided them with direction to a valid code and value of unit, it helps make the process easier and quicker for both sides," says Marvel Hammer, RN, CPC, CHCO, president of MJH Consulting in Denver.

Case study: An established Medicare patient emails your physician complaining of a cough (786.2) and increased mucus production (933.1, Foreign body in pharynx and larynx; larynx). The patient has no history of bronchitis or emphysema, so the physician recommends rest and an over-the-counter medication. Also, he tells the patient to come into the office if the symptoms don't improve in a few days.

To report this online exchange, you submit Category III code 0074T (Online evaluation and management service, per encounter, provided by a physician, using the Internet or similar electronic communications network, in response to a patient's request, established patient).

Snag: You might be able to get 0074T paid if you can convince an insurer that the code is comparable to a covered CPT code's work, medical malpractice risk and practice expense RVUs.

"One of the most difficult parts of this process is presenting this information to third-party payers for reimbursement," says Brenda Dombkowski, CPC, a compliance auditor for Yale University's Department of Internal Medicine in New Haven, CT. "Before billing for an unlisted or Category III procedure, work with physicians and the products representatives to develop an informational packet with a cost matrix. Contact your third-party medical directors and/or insurance representatives with this information for their review," she says.

Failure to contact your payers before your office performs a service that you must report with a Category III code can lead to poor reimbursement and denials, Dombkowski adds.

For example, after your research, you recommend that the carrier reimburse 0074T at the same rate as 99212 (Office or other outpatient visit for the evaluation and management of an established patient ...), which Medicare reimburses at about $40, depending on location. In addition to the code and medical documentation, you should send a one-page cover letter to prove your case. Here are three crucial elements you need to make the letter effective:

1. Use current codes and RVUs. When selecting a code to compare with the Category III or unlisted code, be sure your physician selects one that has not been deleted. You don't run much risk of this with E/M codes, but you should still ensure that you are basing your payment recommendation on the current year's RVUs so you'll get the money you deserve. 

Watch out: Sometimes private-payer contracts specify that the carrier pays codes at an earlier year's rate, so you should develop your payment recommendation using that year. For instance, if the private insurer pays at 2004 rates, you should find RVUs relatively close to that year, Hammer says.

2. Don't create a grand fee for the code. Your physician  should choose Category I codes that are truly reasonable and provide the insurer with a basis to follow your payment recommendation, Hammer says.

Example: You should not submit a letter to the carrier asking it to pay the same for 0074T as it does for a level-five E/M, such as 99215, when the physician simply addressed a cough and mucous build-up, coding experts say.

3. Provide your physician's reasoning. In layman's terms, your physician should describe why he provided the online E/M service and how it compares with the service 99212 represents, Hammer says. For example, the physician can point out that both 0074T and 99212 describe established patient E/M services. Also, the physician should explain that billing 99212 instead of 0074T would not be appropriate because he provided the E/M over the Internet, not in the office.

Remember: Your physician should provide a layman's description of the service, because registered nurses, adjustors and claims processors without medical backgrounds will be reading the letter, Hammer says.

Take the Same Steps For Unlisted-Procedure Codes

To set a reasonable payment rate for unlisted-procedure codes, you can use the same steps as
outlined above.

For example: One of your physician's Medicare patients, who is a lifetime smoker, has a cough (786.2), increased mucous production (933.1), and shortness of breath (786.05). To test for bronchitis and/or emphysema, the physician has the nurse perform maximum inspiratory (MIP) and expiratory (MEP) pressure tests. CPT offers no codes to represent these tests, so you must report 94799 (Unlisted pulmonary service or procedure).

In this case, you could compare the work involved for basic spirometry (94010, Spirometry, including graphic record, total and timed vital capacity, expiratory flow rate measurement[s], with or without maximal voluntary ventilation) with that of the MIP and MEP tests.

Report Now, Benefit Later

While reporting unlisted and Category III codes can be a hassle, it will be worth it in the long run.

"The reason Category III codes exist is they determine whether there is a need to create a CPT code for it. If Medicare never receives submissions of the Category III codes, they will never become Category I CPT codes," explains Barbara J. Cobuzzi, CPC, CPC-H, CHBME, president of CRN Healthcare Solutions in Shrewsbury, NJ. 

As for reporting unlisted codes instead of modifying existing codes with modifiers 22 (Unusual procedural services) and 52 (Reduced services), there's an advantage to that as well because of the way CMS assigns RVUs (relative value units) to codes.

"When it's time to create a CPT code for a procedure, if offices have been reporting the procedure using unlisted codes, the specialty will receive new RVUs for the new code. If they've been using an existing code with a 22 or 52 modifier attached, the specialty will have to steal RVUs from established codes to fund the new code," says Cobuzzi.