Avoid audits and get paid more
Use the right modifiers in the right way
By Michael Miscoe

Modifiers — those numbers applied after a CPT code — are an important part of the coding system.

Improper use can lead to elevated post-payment risk due to inappropriate reimbursement and/or diminished reimbursement.

Modifiers should not be used on every code, because they don’t always apply.

Think of it this way: If a modifier were always appropriate, it wouldn’t be needed. Whatever the modifier represented would simply be part of the code description.

Using modifiers the proper way is essential. Used correctly, they can help get you paid more. Used incorrectly, they can get you into trouble.

RED FLAGS

Even when an insurance claim is paid, it is not “dead.” Insurers want to make sure they did not overpay claims (either paid them improperly or paid fraudulent claims), so they actively review paid claims to identify billing errors or patterns of billing that suggest an error.

Modifiers can act as a red flag in post-payment audits because they generally make an additional representation about how the service was performed or the circumstances in which the service was performed. As such, representation made by a modifier is equally or more important than the representation made by the CPT code it is applied to.

If the representation made by a modifier is inaccurate and causes the carrier to make a payment for a service that it would not have made otherwise, you may be liable to return the money.

Modifiers are related to post-payment risk in another important way. If you use modifiers on services when they do not apply, or use the wrong modifiers on the wrong services, you telegraph to the carrier that you do not know what the modifier means or when it should be used.

As a result, an insurer might be inclined to audit your paid claims to identify circumstances in which your use of a modifier might have led to improper payments. During the course of this analysis, and the subsequent analysis of your records, other problems might become evident that would increase the amount of money the carrier could allege it paid improperly.

Used correctly, however, modifiers help you get reimbursed for all services you provide. Three modifiers are in general use:

• Modifier-25 is necessary when reporting evaluation and management (E/M) services in addition to other services on the same date;

• Modifier-59 is necessary to obtain separate payment for manual therapy (CPT 97140) when reported on the same date as manipulation; and

• An AT modifier is necessary for reimbursement for manipulation services from Medicare.

When these modifiers are used properly and only on services that require a modifier, proper payment is more predictable and enforceable. Unfortunately, some practitioners simply apply these modifiers without giving a thought to what they represent. When this occurs, carriers often ignore the modifier, even on a service for which it might be appropriate, and deny payment.

TWO CATEGORIES OF MODIFIERS

Modifiers most commonly used by DCs can be divided into two categories — bundling modifiers and those that modify the description of the service.

• Bundling modifiers. The most common bundling (or unbundling) modifiers are modifier-25 and modifier-59.

Misuse of these modifiers is somewhat common, and the Department of Health and Human Services, Office of Inspector General (HHS OIG) has focused on these modifiers.¹

Modifier-25, by its description, should only be used with an E/M service. It is never appropriate with a therapy or any other type of service listed in the CPT manual. Review your carrier policy carefully, since many carriers provide explicit instruction for using modifier-25 and the separate reporting of an E/M service.

If your carrier does not have a policy, refer to the policy found in the National Correct Coding Policy Manual (CCI) to determine if modifier-25 is appropriate.

And remember: Unless a carrier has a specific policy to the contrary, you can report an E/M service in addition to manipulation (as well as other therapies) in some circumstances. It is modifier-25 that defines when these circumstances exist.

Unlike the description of modifier-25, the description of modifier-59 is somewhat misleading. Its simple description is “distinct procedural service.” In actuality, it means much more.

As detailed in the CPT description, this modifier is used to define a unique and unusual circumstance in which it is appropriate to perform a service that normally is part of another service or excluded by another service, separately.

• Descriptive modifiers. The most commonly used descriptive modifiers used by chiropractors are the AT modifier for Medicare claims and modifier-52 for time-based therapy services.

The AT modifier means the manipulation service was medically necessary (as defined in CMS policy)² and presumably you have the documentation to prove it.

Modifier-52 indicates a reduced service. Under the coding policy of the American Medical Association (AMA) expressed in the CPT Assistant, applying modifier-52 to a time-based service (constant attendance modalities and procedures) indicates more than half of the time represented by a unit, but less than the full amount of time.

As an example, reporting of one unit of ultrasound (CPT 97035, performed when constant attendance was required) with modifier-52 would indicate performance of at least 7.5 minutes of service, but less than the entire 15 minutes of service.

Where used correctly, modifiers are an important tool to correctly represent the service provided so carriers may process the service correctly.

Improper use is likely to increase your post-payment risk.

Michael Miscoe, BS, CPC, CHCC, CRA, president of Practice Masters, Inc., is a certified professional coder, certified healthcare compliance consultant, and a member of the National Advisory Board of the American Academy of Professional Coders. He provides consulting and educational services to a variety of outpatient provider specialists on healthcare compliance. He can be reached by e-mail at mmiscoe@pmrcodingexperts.com or through the Web site, www.pmrcodingexperts.com.

References
¹ Dept. of Health and Human Services, Office of Inspector General, Use of Modifier-25, OEI-07-03-00470 (Nov. 2005); Dept. of Health and Human Services, Office of Inspector General, Use of Modifier-59 to Bypass Medicare’s National Correct Coding Initiative Edits, OEI-03-02-00771 (Nov. 2005).
² Medicare Benefit Policy Manual, Pub. 100-2, Chapter 15, §240.