Wiki Regarding excision of Lipoma


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:confused:I have read a lot of stuff about coding lipomas. My general surgeon often will remove multiple lipoma's from different parts of the body. Going by what I have read and been advised, we used the codes from the musculoskeletal system, which in one particular case wound up being a $40, 000.00 bill. This is using Ingenix fee analyzer at the 75th percentile for our area (Alaska). When I received another case from the surgeon for coding, there were six lipomas removed from thighs and forearms, all less than 3 cm in width, with simple closures. I sent a request to the surgeon to please document the depth of the incisions used, and (because of the pricing issue) what he deemed a fair fee to charge his patient. Ingenix would have been in excess of $16,000.00. He sent back saying that they were "superficial", but no actual depth, but that the charge should not be in excess of $4,000.00. That was almost to the dollar what it would have been using the integumentary system codes. So, which is right? The integumentary system codes have a 10 day follow-up period. These certainly would not have exceeded that. One follow-up visit to remove the sutures. The musculo-skeletal codes have a 90 day follow-up. Does anyone know where I can get a definitive answer to this puzzling situation. It is causing a great deal of contention in our office.
For the most part, lipomas are coded from the musc/skel section- depending on the operative note of course. Simple closure would be included.

You gave a scenario of 6 lipomas costing about $16K, for us, it would be closer to $4000 total.
Seems like your fee's are extremely high. Of course I am not in Alaska.

We need to see an op note to suggest codes, but you may want to do a little research on your charge to payment ratio. 16k for 6 lipomas, thats an average of over $2600 each. Is your reimbursement that high? I show Medicare reimburses about 400 bucks on a thigh lipoma for my area. I'd worry about an over-inflated A/R.
If it is subcutaneous, use the MS section codes. If it is in the skin (intradermal) or on the skin, use the Integumentary codes. Your surgical notes should be precise on this distinction. Make sure your doc knows that he must document what level the growth is in. About $400 is the going rate for 1-2 cm subcutaneous lesions in my part of Texas.