Are recommended codes OK?
By Marty Kotlar, DC, CHCC

I recently bought a piece of therapy equipment. Do I have to use the CPT codes recommended by the manufacturer?

Before you use any code, do research to find out if it is compliant. If you take a manufacturer’s word that an insurance company will reimburse a product, you could find yourself writing a large check to cover overpayments or possibly be the target of a fraud investigation.

Healthcare providers nationwide learned this lesson when they followed bad advice from a supplier on how to bill Medicare for a product that was not covered. Now they must return the money they received for the improper reimbursements.

According to court documents, the supplier pled guilty to causing providers to file false claims when it instructed them to bill Medicare for its service with a surgical supply code instead of miscellaneous HCPCS code.

According to the government, the company told providers that Medicare approved the product. So far, at least one provider has had to repay $250,000, and some states may launch investigations.

Most manufacturers provide correct and compliant CPT codes. However, mistakes are often made concerning HCPCS code recommendations.

HCPCS (pronounced “hicks-picks”) is the acronym for Healthcare Common Procedure Coding System, is a uniform method to report professional services, procedures, and supplies. Prior to the development of HCPCS in 1983, a uniform system for coding did not exist.

Nearly 5,000 HCPCS Level II national codes represent just one part of a larger, three-level coding system called HCPCS. Each of the three HCPCS levels is a unique coding system.

The levels I, II, and III are also known by the following names:

• Level I — CPT codes. This is the most common type of code. CPT codes use five-digit and two-digit modifiers, both with descriptive terms for reporting services preformed by healthcare providers.

• Level II — National HCPCS codes. Because Level I CPT codes do not contain all the codes needed to report medical services and supplies, CMS developed this second level of codes.

In contrast to the five-digit codes found in Level I, national codes consist of one alphabetic character (a letter between A and V), followed by four digits. They are grouped by the type of service or supply they represent and are updated annually by CMS, with input from private insurance companies.

• Level III — Local codes. These codes are just one part of a larger three-level coding system that became a two-level coding system. HIPAA required a standardized procedure coding. To meet this requirement, all unapproved HCPCS Level III codes/modifiers were eliminated by December 31, 2003.

BlueCross - BlueShield created and required the use of its own coding system; many other insurance companies created their own method of coding physician services and procedures. States also developed codes for Medicaid and workers’ compensation programs. The dental profession also developed codes. All contribute to HCPCS Level II development and maintenance.

Despite the addition and subtraction of codes over the code set’s history, CMS has maintained the intention of HCPCS, which is to accomplish the following:

• Meet the operational needs of Medicare/Medicaid;
• Coordinate government programs by uniform application of CMS policies;
• Allow providers and suppliers to communicate their services in a consistent manner;
• Ensure the validity of profiles and fee schedules through standardized coding; and
• Enhance education and research by providing a vehicle for local, regional, and national utilization comparisons.

Here are just a few examples of commonly used HCPCS codes by chiropractic and MD-DC-PT offices:

1. Pillows and cushions, E0190
2. TENS, E0720
3. Cervical overdoor traction, E0860
4. Freestanding cervical traction stand, E0850
5. Foot insert/removable, L3020
6. Physical or manipulative therapy performed for maintenance rather than restoration, S8990

Marty Kotlar, DC, CHCC, is the president of Target Coding Inc. Dr. Kotlar is certified in healthcare compliance. He can be reached at 800-270-7044, through his Web site, www.TargetCoding.com, or by e-mail at drkotlar@targetcoding.com.