What Are Two of the Highest Audited Modifiers by Payers?

Modifiers are two-character codes, consisting of numbers or letters, appended to Current Procedural Terminology (CPT) or Healthcare Common Procedure Coding System (HCPCS) codes. They provide additional information about a service or procedure without changing its fundamental definition. Modifiers clarify circumstances, such as when a service was altered, performed on a different anatomical site, or provided multiple times. Accurate modifier use is important for proper claim submission, timely reimbursement, and avoiding delays or denials. Payers, including government programs and private insurers, conduct audits to ensure compliance and proper billing practices.

Understanding Medical Modifiers

Modifiers play an important role in the coding and billing process by adding specific details to standard procedure codes. They communicate unique aspects of a service, indicating how it might differ from its typical description. This clarification is essential for payers to understand the full scope of care provided, ensuring appropriate reimbursement. For example, a modifier can specify if a procedure had both professional and technical components, if multiple providers were involved, or if a service was increased or reduced.

The American Medical Association (AMA) develops CPT modifiers, while the Centers for Medicare and Medicaid Services (CMS) maintains HCPCS Level II modifiers. Their correct application prevents claims from being denied due to lack of information or perceived bundling of services. Misuse can lead to payment delays, denials, and potential scrutiny from auditors.

Modifier 25

Modifier 25, defined as “Significant, Separately Identifiable Evaluation and Management Service by the Same Physician or Other Qualified Health Care Professional on the Same Day of the Procedure or Other Service,” is used when an Evaluation and Management (E/M) service is distinct and separate from a procedure performed on the same day by the same provider. This modifier signifies that the E/M service was above and beyond the usual pre-operative and post-operative care associated with the procedure. It is appended only to the E/M code to indicate its separate nature.

Appropriate use of Modifier 25 occurs when the patient’s condition necessitates a significant E/M service beyond what is typically included in the procedure itself. For instance, if a patient presents with new symptoms unrelated to a scheduled minor procedure, and a comprehensive E/M service is performed to address these new concerns, Modifier 25 would be appropriate for the E/M code. The E/M service must be medically necessary and clearly documented as separate from the decision to perform the procedure.

Modifier 25 is frequently audited by payers due to high rates of misuse and misunderstanding, often appearing on up to 35% of submitted claims. Common misuse cases arise when the E/M service is not truly separate and significant, or when it represents work inherent to the procedure. For example, if a patient’s sole purpose for a visit is a minor procedure, and no additional, distinct E/M work is performed, appending Modifier 25 to the E/M code would be inappropriate. Payers may deny claims or seek recoupment if documentation does not clearly support a truly distinct and significant E/M service.

Modifier 59

Modifier 59, “Distinct Procedural Service,” indicates that a procedure or service was distinct or independent from other non-E/M services performed on the same day. It is typically applied to identify procedures or services that are not normally reported together but are appropriate under specific circumstances. This modifier serves as an “unbundling modifier,” allowing separate payment for services that might otherwise be considered inclusive or bundled.

The primary purpose of Modifier 59 is to bypass National Correct Coding Initiative (NCCI) edits that prevent payment for services normally bundled together. It can be applied in various scenarios, such as when services are performed during a different session or patient encounter, involve a different procedure or surgery, or target a different anatomical site or organ system. For example, if procedures are performed on separate, non-contiguous lesions or different body parts, Modifier 59 can be used to justify separate billing.

Despite its utility, Modifier 59 is frequently audited and is considered one of the most misused modifiers. Payers, including Medicare, view it as a modifier of “last resort,” to be used only when a more specific modifier is unavailable. Common misuses include applying it when a more descriptive modifier exists, or when the services are not truly distinct. For instance, using Modifier 59 to unbundle services that are inherently part of a single procedure, or when the procedures are performed on contiguous structures of the same organ, is generally inappropriate. Overuse or incorrect application can trigger audits, leading to claim denials.

Strategies for Accurate Documentation

Maintaining precise and thorough clinical documentation is important for ensuring accurate modifier use and mitigating audit risks. Comprehensive records should clearly support the medical necessity for each service billed, especially when modifiers are appended. Documentation must provide enough detail to justify the distinctness or significance of services performed on the same day.

Providers should establish internal auditing practices to regularly review coding and documentation accuracy. This proactive approach helps identify and correct errors before claims are submitted, reducing the likelihood of denials and external audits. Regular audits can ensure compliance with evolving coding guidelines and payer-specific requirements.

Ongoing staff education and training are also important for accurate modifier use and compliance. Training should cover appropriate scenarios for modifier application, common pitfalls, and the importance of supporting documentation. Fostering a culture of compliance where staff feel comfortable reporting concerns and mistakes can further strengthen billing accuracy and reduce audit exposure.