Coding & Billing

Financial Management

By: Stephanie Ellis

Published: 10/10/2007

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Billing for Terminated Procedures


Stephanie Ellis, RN, CPC When procedures are terminated before or after anesthesia is administered, it's not always easy to know what you can and can't bill to Medicare. Here's how to make sure your facility doesn't lose money in these instances.

Stephanie Ellis, RN, CPC Defining a terminated procedure
Don't confuse terminated procedures with incomplete procedures or those that the surgeon didn't fully perform, for whatever reason. A good working definition of a terminated procedure is a procedure that would have been completed in full, had a medical complication not developed. Some common examples: heart arrhythmia, a drop in blood pressure or a hemorrhage.

When can't you bill a case to Medicare? When the case is cancelled while the patient is in your lobby, in the pre-op area (still dressed) or on a gurney, and no anesthesia (including a pre-medication injection, such as Demerol and Phenergan) has been given and no IV fluids have been started. According to Medicare, the surgery center has not "expended any substantial resources" in these circumstances. This might happen when

  • the patient has high anxiety about the procedure and decides he can't go through with it;
  • an EKG's abnormal finding alarms the anesthesiologist; and
  • the surgery is cancelled or postponed.

Examples of when you can bill
In Medicare's view, you've expended "substantial resources" in starting a case if the patient is on a gurney and has been taken to the OR, IV fluids have been started and the patient may or may not have received a pre-medication injection.

If a procedure is terminated due to medical complications after the patient has been prepared for surgery and taken to the OR, but before anesthesia has been induced, Medicare will reimburse for the terminated procedure at 50 percent of the allowed amount. Append the ?73 modifier to the CPT code billed for the terminated procedure.

When the case has been started and anesthesia has been induced, a terminated procedure is reimbursed by Medicare at the full allowable amount. If a procedure is terminated due to medical complications after anesthesia has been induced, it will be paid at 100 percent of the allowed amount. Append the ?74 modifier to the CPT code billed for the terminated procedure.

In the case of a terminated cataract case in which the IOL wasn't inserted, Medicare will deduct the allowance for the unused IOL from your facility's payment. The IOL packaging must have been opened so it can't be used for another patient to receive full payment.

Business Office News and Notes

? ASC reimbursement rates likely will be linked to Medicare's generally higher hospital outpatient department (HOPD) rates by 2008, says Eddie Allen, a consultant for FASA. Even though it's unlikely that Medicare would pay ASCs at 100 percent of the HOPD rate, ASCs figure to be reimbursed better under a payment system in which CPT codes fall into more than 700 Ambulatory Payment Classifications than one in which 2,464 procedures fall into nine payment groups. Examples:

  ?? The HOPD rate for CPT 66984 (cataract surgery with IOL) is $1,329.48, $356.48 more than the ASC rate of $973.

  ?? The HOPD rate for CPT 29826 (shoulder arthroscopy/surgery) is $2,483, $1,973 more than the ASC rate of $510.

"The best news of a linked payment system is that it gets ASCs out of the box of being tied to a list of procedures to an HOPD system that allows much broader coverage for procedures," says Mr. Allen.

? Medicare patients can now pay out-of-pocket for presbyopia-correcting IOLS, thanks to a ruling by CMS. That means facilities will receive the standard $200 reimbursement for a new technology IOL, and patients will pay the remainder. Providers have generally not offered presbyopia-correcting IOLs to Medicare beneficiaries "because the costs for this advanced technology substantially exceed Medicare's payment," says CMS. Eyeonics' Crystalens costs $825, Alcon's AcrySof ReStor costs $875 and AMO's ReZoom is $895. Patients must request the insertion of such IOLs before their procedures and agree to pay the difference between the reimbursement and actual cost, including the IOL, any extra facility charges incurred and a physician service charge for any additional physician work and resources. The ruling is effective immediately.

? The Plicator minimally invasive endoscopic treatment for gastroesophageal reflux disease (GERD) is now recognized for payment under Medicare's hospital outpatient payment system. The Plicator technology will be recognized under a newly assigned HCPCS C-code. Through a simple, outpatient procedure, the Plicator (pictured) restores the normal anti-reflux barrier, says the manufacturer, NDO Surgical. Clinical studies have shown the Plicator procedure to be effective in reducing both symptoms and medication use associated with GERD.

? CMS will add CPT 66711 (ciliary body destruction, cyclophotocoagulation, endoscopic) to the ASC list of covered procedures in the July 2005 update, with an effective date of Jan. 1, 2005. CMS inadvertently left CPT 66711 off of the ASC list it updated in January. You may bill procedures performed between Jan. 1, 2005, and July 1, 2005, retrospectively using the new code 66711, which is in the payment group 2 level. CPT 66710 (ciliary body destruction, cyclophotocoagulation, transscleral) continues to be valid for payment in an ASC.

Documentation requirements
Medicare's documentation requirements for discontinued procedures are quite laborious. Whether recorded in an op report or on a surgeon-signed form, the documentation for terminated procedures must specify the

  • reason surgery was terminated;
  • services that were performed;
  • supplies that were provided/used;
  • services that weren't performed (intended)
  • supplies that weren't provided/used (intended)
  • time spent in each stage of the surgery that was completed (for example, pre-op, operative and post-procedure termination)
  • time that would have been spent on the intended procedure; and
  • CPT procedure code(s) for the covered (intended) procedure, had the intended procedure been performed, with the appropriate modifiers appended.

When the surgeon intended to perform more than one procedure during the operative session, and some, but not all, of the planned procedures were completed, bill the completed procedure(s) at full fee, without the ?73 or ?74 modifiers. Bill those procedure(s) that weren't completed at full fee, with the appropriate ?73 or ?74 modifiers. Bill those intended procedure(s) that weren't started with the appropriate (?73 or ?74) modifiers on the claim.

An example of such a case: The patient is in the OR under general anesthesia. The surgeon makes his incisions to establish portals and inserts the arthroscope into the patient's knee. He begins and completes the medial meniscectomy procedure. As he begins an arthroscopic ACL repair, the patient has a sudden drop in blood pressure. The team administers medications to help with the blood pressure drop, but to no avail. They must immediately close and reverse anesthesia. Here's how you'd code the terminated knee surgery case:

Medial meniscectomy procedure completed
    - 29881-SG-RT

ACL repair procedure not completed and terminated
    - 29888-SG-74-RT

Medicare should reimburse you at the normal reimbursement for both procedures.

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