Medicare payment for multiple surgical procedure - standard pricing method

MULTIPLE SURGERY PRICING

Pricing Methods

According to Medicare guidelines, surgical procedures may be priced by two different pricing methods:

* Standard.
* Endoscopic.

Standard Pricing Method

The standard pricing method is denoted by an indicator of (2) under the “Mult Proc” column on the Medicare Physician Fee Schedule Database (MPFSDB). The allowance is calculated at:

* One hundred percent for the procedure with the highest fee schedule amount.
* Fifty percent for the second through fifth highest fee schedule amounts.

Each standard priced procedure after the fifth procedure requires submission of an operative report.
Standard Pricing Example

The following example demonstrates the standard pricing method:

Code Database Indicator Billed Amount $ Medicare Allowed Amount $ Ranking Allowance $
35301    2                             2,000             1,043.48                                   100%          1,043.48 x 80%
35201    2                           1,000                 922.90                                    50%            461.45 x 80%
35261    2                            1,050             1,010.60                                    50%           505.30 x 80%




 Claims for Multiple Surgeries

A.General
Multiple surgeries are separate procedures performed by a single physician or physicians in the same group practice on the same patient at the same operative session or on the same day for which separate payment may be allowed. Co-surgeons, surgical teams, or assistants-at-surgery may participate in performing multiple surgeries on the same patient on the same day.

Multiple surgeries are distinguished from procedures that are components of or incidental to a primary procedure. These intra-operative services, incidental surgeries, or components of more major surgeries are not separately billable. See Chapter 23 for a description of mandatory edits to prevent separate payment for those procedures. Major surgical procedures are determined based on the MFSDB approved amount and not on the submitted amount from the providers. The major surgery, as based on the MFSDB, may or may not be the one with the larger submitted amount.

Also, see subsection D below for a description of the standard payment policy on multiple surgeries. However, these standard payment rules are not appropriate for certain procedures. Field 21 of the MFSDB indicates whether the standard payment policy rules apply to a multiple surgery, or whether special payment rules apply. Site of service payment adjustments (codes with an indicator of “1” in Field 27 of the MFSDB) should be applied before multiple surgery payment adjustments.


B.Billing Instructions

The following procedures apply when billing for multiple surgeries by the same physician on the same day.

*Report the more major surgical procedure without the multiple procedures modifier “-51.”

*Report additional surgical procedures performed by the surgeon on the same day with modifier “-51.”

There may be instances in which two or more physicians each perform distinctly different, unrelated surgeries on the same patient on the same day (e.g., in some multiple trauma cases). When this occurs, the payment adjustment rules for multiple surgeries may not be appropriate. In such cases, the physician does not use modifier “-51” unless one of the surgeons individually performs multiple surgeries.

C.Carrier Claims Processing System Requirements

Carriers must be able to:

1.Identify multiple surgeries by both of the following methods:

*The presence on the claim form or electronic submission of the “-51” modifier; and

*The billing of more than one separately payable surgical procedure by the same physician performed on the same patient on the same day, whether on different lines or with a number greater than 1 in the units column on the claim form or inappropriately billed with modifier “-78” (i.e., after the global period has expired);

2.Access Field 34 of the MFSDB to determine the Medicare fee schedule payment amount for each surgery;

3.Access Field 21 for each procedure of the MFSDB to determine if the payment rules for multiple surgeries apply to any of the multiple surgeries billed on the same day;

4.If Field 21 for any of the multiple procedures contains an indicator of “0,” the multiple surgery rules do not apply to that procedure. Base payment on the lower of the billed amount or the fee schedule amount (Field 34 or 35) for each code unless other payment adjustment rules apply;

5.For dates of service prior to January 1, 1995, if Field 21 contains an indicator of “1,” the standard rules for pricing multiple surgeries apply (see items 6-8 below);

6.Rank the surgeries subject to the standard multiple surgery rules (indicator “1”) in descending order by the Medicare fee schedule amount;

7.Base payment for each ranked procedure on the lower of the billed amount, or:

*100 percent of the fee schedule amount (Field 34 or 35) for the highest valued procedure;

*50 percent of the fee schedule amount for the second highest valued procedure; and

*25 percent of the fee schedule amount for the third through the fifth highest valued procedures;

8.If more than five procedures are billed, pay for the first five according to the rules listed in 5, 6, and 7 above and suspend the sixth and subsequent procedures for manual review and payment, if appropriate, “by report.” Payment determined on a “by report” basis for these codes should never be lower than 25 percent of the full payment amount;

9.For dates of service on or after January 1, 1995, new standard rules for pricing multiple surgeries apply. If Field 21 contains an indicator of “2,” these new standard rules apply (see items 10-12 below);

10.Rank the surgeries subject to the multiple surgery rules (indicator “2”) in descending order by the Medicare fee schedule amount;

11.Base payment for each ranked procedure (indicator “2”) on the lower of the billed amount:

*100 percent of the fee schedule amount (Field 34 or 35) for the highest valued procedure; and

*50 percent of the fee schedule amount for the second through the fifth highest valued procedures; or

12.If more than five procedures with an indicator of “2” are billed, pay for the first five according to the rules listed in 9, 10, and 11 above and suspend the sixth and subsequent procedures for manual review and payment, if appropriate, “by report.” Payment determined on a “by report” basis for these codes should never be lower than 50 percent of the full payment amount. Pay by the unit for services that are already reduced (e.g., 17003). Pay for 17340 only once per session, regardless of how many lesions were destroyed;

NOTE: For dates of service prior to January 1, 1995, the multiple surgery indicator of “2” indicated that special dermatology rules applied. The payment rules for these codes have not changed. The rules were expanded, however, to all codes that previously had a multiple surgery indicator of “1.” For dates of service prior to January 1, 1995, if a dermatological procedure with an indicator of “2” was billed with the “-51” modifier with other procedures that are not dermatological procedures (procedures with an indicator of “1” in Field 21), the standard multiple surgery rules applied. Pay no less than 50 percent for the dermatological procedures with an indicator of “2.”  See §§40.6.C.6-8 for required actions.

13.If Field 21 contains an indicator of “3,” and multiple endoscopies are billed, the special rules for multiple endoscopic procedures apply. Pay the full value of the highest valued endoscopy, plus the difference between the next highest and the

base endoscopy. Access Field 31A of the MFSDB to determine the base endoscopy.

EXAMPLE

In the course of performing a fiber optic colonoscopy (CPT code 45378), a physician performs a biopsy on a lesion (code 45380) and removes a polyp (code 45385) from a different part of the colon. The physician bills for codes 45380 and 45385. The value of codes 45380 and 45385 have the value of the diagnostic colonoscopy (45378) built in.

Rather than paying 100 percent for the highest valued procedure (45385) and 50 percent for the next (45380), pay the full value of the higher valued endoscopy (45385), plus the difference between the next highest endoscopy (45380) and the base endoscopy (45378).

Carriers assume the following fee schedule amounts for these codes: 45378 - $255.40
45380 - $285.98

45385 - $374.56

Pay the full value of 45385 ($374.56), plus the difference between 45380 and 45378 ($30.58), for a total of $405.14.

NOTE: If an endoscopic procedure with an indicator of “3” is billed with the “-51” modifier with other procedures that are not endoscopies (procedures with an indicator of “1” in Field 21), the standard multiple surgery rules apply. See §§40.6.C.6-8 for required actions.

14.Apply the following rules where endoscopies are performed on the same day as unrelated endoscopies or other surgical procedures:

*Two unrelated endoscopies (e.g., 46606 and 43217): Apply the usual multiple surgery rules;

*Two sets of unrelated endoscopies (e.g., 43202 and 43217; 46606 and 46608): Apply the special endoscopy rules to each series and then apply the multiple surgery rules. Consider the total payment for each set of endoscopies as one service;

*Two related endoscopies and a third, unrelated procedure: Apply the special endoscopic rules to the related endoscopies, and, then apply the multiple surgery rules. Consider the total payment for the related endoscopies as one service and the unrelated endoscopy as another service.

15.If two or more multiple surgeries are of equal value, rank them in descending dollar order billed and base payment on the percentages listed above (i.e., 100 percent for the first billed procedure, 50 percent for the second, etc.);

16.If any of the multiple surgeries are bilateral surgeries, consider the bilateral procedure at 150 percent as one payment amount, rank this with the remaining procedures, and apply the appropriate multiple surgery reductions. See §40.7 for bilateral surgery payment instructions.);

17.Round all adjusted payment amounts to the nearest cent;

18.If some of the surgeries are subject to special rules while others are subject to the standard rules, automate pricing to the extent possible. If necessary, price manually;

19.In cases of multiple interventional radiological procedures, both the radiology code and the primary surgical code are paid at 100 percent of the fee schedule amount. The subsequent surgical procedures are paid at the standard multiple surgical percentages (50 percent, 50 percent, 50 percent and 50 percent);

20.Apply the requirements in §§40 on global surgeries to multiple surgeries;

21.Retain the “-51” modifier in history for any multiple surgeries paid at less than the full global amount; and

22.Follow the instructions on adjudicating surgery claims submitted with the “-22” modifier. Review documentation to determine if full payment should be made for those distinctly different, unrelated surgeries performed by different physicians on the same day.

D.Ranking of Same Day Multiple Surgeries When One Surgery Has a “-22”


If the patient returns to the operating room after the initial operative session on the same day as a result of complications from the original surgery, the complications rules apply to each procedure required to treat the complications from the original surgery. The multiple surgery rules would not apply.

However, if the patient is returned to the operating room during the postoperative period of the original surgery, not on the same day of the original surgery, for multiple procedures that are required as a result of complications from the original surgery, the complications rules would apply. The multiple surgery rules would also not apply.

Multiple surgeries are defined as separate procedures performed by a single physician or physicians in the same group practice on the same patient at the same operative session or on the same day for which separate payment may be allowed. Co-surgeons, surgical teams, or assistants-at-surgery may participate in performing multiple surgeries on the same patient on the same day.

Multiple surgeries are distinguished from procedures that are components of or incidental to a primary procedure. These intra-operative services, incidental surgeries, or components of more major surgeries are not separately billable. See Chapter 23 for a description of mandatory edits to prevent separate payment for those procedures.