What is Correct coding policy - For Beginners - Part 1

Correct Coding Policy

The Correct Coding Initiative was developed to promote national correct coding methodologies and to control improper coding leading to inappropriate payment in Part B claims.

The principles for the correct coding policy are:

The service represents the standard of care in accomplishing the overall procedure;

The service is necessary to successfully accomplish the comprehensive procedure. Failure to perform the service may compromise the success of the procedure; and

The service does not represent a separately identifiable procedure unrelated to the comprehensive procedure planned.

For a detailed description of the correct coding policy, refer to http://www.cms.hhs.gov/medlearn/ncci.asp.

The CMS as well as many third party payers have adopted the HCPCS/CPT coding system for use by physicians and others to describe services rendered. The system contains three levels of codes. Level I contains the American Medical Association’s Current Procedural Terminology (CPT) numeric codes. Level II contains alpha-numeric codes primarily for items and services not included in CPT. Level III contains carrier specific codes that are not included in either Level I or Level II. For a list of CPT and HCPCS codes refer to the CMS Web site.

The following general coding policies encompass coding principles that are to be applied in the review of Medicare claims. They are the basis for the correct coding edits that are installed in the claims processing systems effective January 1, 1996.

A. Coding Based on Standards of Medical/Surgical Practice

All services integral to accomplishing a procedure are considered bundled into that procedure and, therefore, are considered a component part of the comprehensive code. Many of these generic activities are common to virtually all procedures and, on other occasions, some are integral to only a certain group of procedures, but are still essential to accomplish these particular procedures. Accordingly, it is inappropriate to separately report these services based on standard medical and surgical principles.
Because many services are unique to individual CPT coding sections, the rationale for rebundling is described in that particular section of the detailed coding narratives that are transmitted to carriers periodically.

B. CPT Procedure Code Definition

The format of the CPT manual includes descriptions of procedures, which are, in order to conserve space, not listed in their entirety for all procedures. The partial description is indented under the main entry. The main entry then encompasses the portion of the description preceding the semicolon. The main entry applies to and is a part of all indented entries, which follow with their codes.

In the course of other procedure descriptions, the code definition specifies other procedures that are included in this comprehensive code. In addition, a code description may define a rebundling relationship where one code is a part of another based on the language used in the descriptor.

C. CPT Coding Manual Instruction/Guideline

Each of the six major subsections include guidelines that are unique to that section. These directions are not all inclusive of nor limited to, definitions of terms, modifiers, unlisted procedures or services, special or written reports, details about reporting separate, and multiple or starred procedures and qualifying circumstances.

D. Coding Services Supplemental to Principal Procedure (Add-On Codes) Code

Generally, these are identified with the statement “list separately in addition to code for primary procedure” in parentheses, and other times the supplemental code is used only with certain primary codes, which are parenthetically identified. The reason for these CPT codes is to enable physicians and others to separately identify a service that is performed in certain situations as an additional service. Incidental services that are necessary to accomplish the primary procedure (e.g., lysis of adhesions in the course of an open cholecystectomy) are not separately billed.

E. Separate Procedures

The narrative for many CPT codes includes a parenthetical statement that the procedure represents a “separate procedure.”

The inclusion of this statement indicates that the procedure, while possible to perform separately, is generally included in a more comprehensive procedure, and the service is not to be billed when a related, more comprehensive, service is performed. The “separate procedure” designation is used with codes in the surgery (CPT codes 10000-69999), radiology (CPT codes 70000-79999), and medicine (CPT codes 90000-99199) sections. When a related procedure from the same section, subsection, category, or subcategory is performed, a code with the designation of “separate procedure” is not to be billed with the primary procedure.

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