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How Can CPT Modifiers Make a Huge Difference in Your Profitability_ A Complete Guideline

by | Nov 29, 2021

lab billing tasks

Lab revenue cycle management_ what comes to your mind after listening to this word? Obviously, all of you will get the meaning of a complicated procedure. That starts with patients scheduling & ends with healthcare providers getting paid for the medical care service provided to the patients.

Almost every lab practitioner has the know-how of the administrative tasks involved in the RCM process. But have you ever thought about the role of modifiers in lab billing services? Do you know using precise coding modifiers can help you to collect each & every single dollar from the insurance companies?

The majority of healthcare practitioners might not have an understanding of this aspect of medical billing. However, if you want to stay financially fit & don’t want to lose even a single penny of your hard-earned revenue. You must have complete knowledge of all the billing tasks, particularly the CPT modifiers. That has the potential to make a huge difference in your reimbursements and the overall profitability of our laboratory practice.

Before making further discussion about the role of modifiers in the RCM process. It’s pertinent to mention here that they are part of the medical codes. Healthcare providers use alphanumeric standard medical codes to describe the patients’ diagnosis, treatments, medical equipment and healthcare services clearly. Current Procedural Terminology, or “CPT®” codes, are being used to define the medical services and procedures furnished by qualified healthcare professionals.

Moreover, for supplies and equipment like bandages and crutches, there are other codes called HCPCS. (It stands for Healthcare Common Procedure Coding System). For laboratory practitioners who are new in this business. Let it be clear that CPT codes start with a number, while HCPCS codes start with letters. That gives more detailed information about the medical procedure or service that has been altered in some or another way.

Modifiers are being used when medical codes fail to completely describe the complete, diagnostic, surgical and medical procedures. Just think for a while, how can you get complete reimbursements from the payers without giving them the complete details about the healthcare services? The answer is obviously a ‘No’.

In case of additional services provided to the patients, modifiers come into play. And enable lab technicians to get complete payments from the payers. As a lab technician, you may have read or heard about the importance of medical codes from both financial as well as legal aspects. However, from now on, you should always keep in mind that modifiers are one of the essential elements of coding too. They represent the medical procedures and care services rendered, comprehensively and paves the way to consistent cash flow.Using incorrect modifies intentionally, (for illegal financial gain) not only results in lost compensation. But it can land healthcare providers in legal trouble. For example, having a history of manipulating the CPT modifiers results in heavy fines, federal penalties, cancellation of licenses and even imprisonments.

So, in order to save your laboratory practice from financial loss. You should make sure that: your billing and coding team have in-depth knowledge about the latest, modified or deleted modifiers as well as medical codes. They must be fluent in using CPT modifiers to indicate that a procedure has been altered in some or another way.

How Do Modifiers Work?

CPT modifiers help lab practitioners to describe the actual reason: why a particular procedure was performed. It also indicates the location of the body where the procedure was performed. Additionally, they narrate the information about the number of procedures and healthcare professionals or surgeons that took part in performing that particular medical procedure.

The information also includes the additional services (if any were performed) and any unusual events that occurred. Actually, CPT modifiers consist of two numeric codes. But sometimes, they can also be alphanumeric, that are being stuck to the end of the CPT codes with a hyphen.

Why do Modifiers Matter a Lot?

Accurate modifiers usually work as a catalyst for collecting payments from insurance agencies. Moreover, they remove the necessity of separate service or procedure listing. As we have already discussed, the incorrect modifiers are considered as healthcare abuse and result in significant revenue loss.

Therefore, it is extremely crucial for medical coders to stay compliant. When choosing the modifiers to describe the additional information about the healthcare services. Make sure that they are using updated manuals to find accurate modifiers for laboratory billing services.

CPT Modifiers:

Current Procedural Terminology (CPT) modifiers are defined by the Fiscal Intermediary. The American Medical Association (AMA) holds the copyright to change or update these modifiers. They consist of two numeric digits, that describe the following circumstances:

  • Why was a procedure necessary?
  • How many procedures were performed?
  • How many times the procedure or services been provided? Either once or twice?
  • What was the exact location of the body that receives treatment?
  • How many healthcare providers were involved in the service or procedure?
  • Technician component and professional component of the services or procedures?
  • Did any unusual occurrence affect the medical procedures? If yes then what was the reasons for that particular occurrence?
  • Was the procedure discontinued?
  • Any other information that is important for preparing and submitting medical claims.

The most commonly used CPT modifiers

  • Modifier 22 – Increased procedural services.
  • 23 – Unusual anaesthesia.
  • 24 – Unrelated evaluation and management service by the same physician or other qualified healthcare professional during a postoperative period.
  • 25 – Significant, separately identifiable evaluation and management service by the same physician or other qualified health care professionals on the same day of the procedure or other service.
  • 26- Professional Component.
  • 27-Multiple Outpatient Hospital E/M Encounters on the Same Date.
  • 29- Global procedures, those procedures where one provider is responsible for both the professional and technical components.
  • 32- Mandated Services.
  • 52- Reduced services.
  • 53- A discontinued procedure.
  • 55- Postoperative management only.
  • 56- Preoperative management only.
  • 57- Decision for surgery.
  • 59- Distinct Procedural Services.
  • 62- Two Surgeons.
  • 63-Procedure Performed on Infants less than 4kg
  • 66-Surgical Team
  • Modifier 76 – report repeat procedures performed on the same day by the same healthcare provider.
  • Modifier 90-
  • 91- Repeat Clinical Diagnostic Laboratory Test.
  • 92- Alternative Laboratory Platform Testing.
  • 99- Multiple modifiers.

HCPCS Modifiers

Level II or HCPCS modifiers can be both Alphabets or Alphanumeric. They are used
to provide additional information to the insurance agencies about the items used to deliver non-physician services

Here is the list of most commonly used HCPCS modifiers:

  • AA- Anesthesia services are performed by anesthesiologists.
  • AD- Medical supervision by a physician, more than four concurrent anaesthesia procedures.
  • AH- Clinical Psychologist (CP) Services. [Used when a medical group employs a CP and bills for the CP’s service].
  • AJ- Clinical Social Worker (CSW). [Used when a medical group employs a CSW and bills for the CSW’s service].
  • QN- Ambulance service furnished directly by a provider of services.
  • GZ- Item or service expected to be denied as not reasonable and necessary.
  • GY- Item or service statutorily excluded or does not meet the definition of any Medicare benefit.
  • GW- Service not related to the hospice patient’s terminal condition.

Functional and Informational Modifiers

It’s very crucial to know the restrictions, formats and guidelines of the accurate use of modifiers. That has been set by the concerned government authorities. Because failure to use the modifiers as per given standards can result in delayed, denied or partial payments.

Moreover, it is also very important to have a complete understanding of the different kinds of modifiers. For instance, those modifiers that have a direct impact on reimbursements are known as functional modifiers. On the other hand, modifiers that provide detailed and additional information, are known as informational modifiers.

Here’s a question that arises: how can laboratory practitioners prevent the claims denials due to the incorrect modifiers. The answer is very simple. As a lab technician, you should adopt the following strategies to keep your healthcare business afloat in terms of finances.

Accurate medical documentation:

  • Make sure that your administrative teams are keeping the health records with a high level of accuracy. Because medical coders get the information about patients’ diagnoses and healthcare services rendered through these codes. So, a slight mistake in the medical documents can result in assigning incorrect medical codes or modifiers. That negatively affects the entire revenue cycle management.
  • As the healthcare industry is witnessing constant changes in terms of payers policies, federal/state laws, modifiers, medical codes and billing guidelines. It is important for the billing and coding staff to always stay updated with all these evolutions.
  • As we all know, dealing with complicated billing and coding tasks require specific skills and expertise. Without the assistance of a highly trained billing & coding team, having complete knowledge to use the medical codes and modifies precisely. Lab technicians can’t keep their claims process tight.
  • However, if you are facing challenges in managing an in-house billing team. Then the best option you can avail of is outsourcing lab medical billing services to a trusted third party. Instead of spending a significant amount of money and time in building and maintaining the RCM department in lab premises. Acquiring the assistance of outsourced billing companies will definitely make sense.
  • Off-shore billing and coding experts are highly capable of eliminating the obstacles in your financial growth. They have a proven track record of helping laboratory practitioners in managing their billing tasks, according to their medical specialities. Furthermore, you can also get rid of the excessive capital costs i.e. hiring and training of billers, employee incentives, office workspace, purchase and maintenance of the advanced billing tools etc.
  • Additionally, you can redirect your focus on the core competencies of your healthcare business. Which is to alleviate the sufferings of the patients by providing standard medical care services. In short, outsourcing can results in improved billing collections, reduced financial and administrative burdens.

Do you want to discover your financial potential without investing extra time and money? Then Laboratory Billings can be your best partner in managing your revenue cycle management in a seamless manner. Our expert billers and coders always stay ready to help you in achieving revenue goals. Admire this dedication? Then don’t miss the opportunity and make the best deal for your lab business today.

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