Outpatient Code Editor Clarifications
by Kimberly Anderwood Hoy Baker, JD
In my last instructor’s note, I reviewed the many coding and policy clarifications in the April OPPS Update. The April Integrated Outpatient Code Editor (I/OCE) also had a large volume of clarifications and changes to the edits to correct issues with processing claims related to new policies adopted in January. Most of the changes were made retroactively effective back to January, allowing reprocessing of claims that were negatively affect by the edits.
There were two clarifications related to inpatient-only procedure processing. Normally, if an inpatient-only procedure is reported on a claim, the inpatient-only procedure and all other services are denied. However, there is a separate procedure exception that allows payment for an outpatient-appropriate procedure if the reported inpatient-only procedure is on the designated “separate procedure” list. The “separate procedure” list contains add-on codes, which are ignored for processing when reported in addition to outpatient-appropriate procedures to allow the outpatient-appropriate procedure to be paid. The April I/OCE clarified that status indicator J1 procedures will trigger this exception, in addition to status indicator T procedures specified in the prior guidance.
The April I/OCE also clarified processing for new C-APC 5881 for inpatient-only procedures provided on an emergency basis and the patient expires. The clarification specifies that the services excluded from packaging under the C-APC processing logic are also excluded when an inpatient-only procedure is reported with modifier -CA triggering payment of C-APC 5881. Although the scenarios would be unlikely, this processing logic allows separate payment for excluded services such as ambulance services, preventive services, and pass-through devices, drugs and biologicals in addition to C-APC 5881.
Another clarification to C-APC processing logic is related to laboratory services reported with the L1 modifier. Formerly, the I/OCE indicated that laboratory services reported with an L1 modifier would be paid separately in addition to services with status indicators J1 and J2 indicating services paid under C-APCs. The April I/OCE indicates this was an error in the documentation of the logic applied to these services. In fact, the logic packaged laboratory services reported with the L1 modifier as adjunctive services to the comprehensive service when reported on the same claim with a status indicator J1 or J2 service triggering a C-APC. In other words, even if a laboratory service is unrelated to other services on the same claim (i.e., ordered for a different purpose by a different provider) and reported with the proper modifier L1, it will not be paid separately from a C-APC. Rather, it will be considered adjunctive and paid as part of the C-APC.
Finally, related to C-APCs, the April I/OCE corrected an error in the complexity logic that did not take into account the correct reporting of modifier 50. A complexity adjustment may apply to some C-APCs if specified secondary procedures are reported in addition to the primary procedure that triggers the C-APC assignment. Some of the secondary procedures triggering the complexity adjustment are actually a second unit of the primary procedure. The logic took this into account by allowing units of two to trigger the complexity adjustment when appropriate. Some of the pairs[1] are procedures with bilateral surgery indicator “1” and are only appropriately reported with the modifier 50 and a unit of 1 if done on both sides of the body. The logic was corrected to allow reporting of a unit of 2 or modifier 50 to trigger the complexity adjustment in these pairs of codes. This change was retroactive to January 2015 and providers may be able to go back and request reprocessing of claims that should have been subject to the complexity adjustment, but were reported with modifier 50 rather than a unit of 2.
To view the complete article that appeared on Medicare Compliance Watch, click here.