The multiple surgical reduction rule: Cutting costs

When more than one surgical service is rendered on the same date, most carriers reduce one or more of the surgeries by 50 percent, 25 percent, 10 percent or some other percentage.

In this article I will discuss three main issues:1. Medicare's reduction policy.2. Commercial carriers' reduction policies.3. Example of the reduction policies.

Medicare

1. Codes that are exempt from reduction.

2. Reductions when more than five surgical services are performed on the same date of service.

First, let's discuss several issues. The most important issue is understanding the term "surgical procedure," and therefore being able to ascertain which services on the claim are actually applicable to the reduction rule. Many times dermatologists and their staff believe that certain services are surgeries when actually they are not. Here are some guidelines:

a. All CPT codes that start with a "1" are surgeries (e.g., CPT codes 11100, 17000, 11600, etc.) and are subject to the reduction rules.

b. Codes that start with a "9" are not surgical procedures (e.g., CPT codes 95044, 96910, 96567, etc.) and are not subject to the reduction rules.

c. Codes that start with an "8" are not surgical procedures and are not subject to the reduction rules.

Second, you must be able to identify which surgical services are exempt from the multiple surgery reduction rule. Those exempt are considered secondary or add-on codes. They are:
11101, 11201, 11732, 13102, 13122, 13133, 13153, 15001, 15101, 15121, 15201, 15221, 15241, 15261, 15343, 15351, 15401, 15787, 17003, 17004, 17304, 17305, 17306, 17307, 17310

Note: This is not an exclusive list. Only the most commonly performed dermatology codes are included in this list.

Last, staff must be aware of the "more than five surgery per date of service" rule. Medicare states that if more than five surgical services are performed on the same date of service, they may suspend payment for the 6^th, 7^th, 8^th, etc., service pending the review of medical notes. Based on their review, they may further reduce the services beyond 50 percent.

There are several noteworthy items here:

1. Many carriers ignore these rules and pay for more than five services on the same date without any claims delay.

2. I have never seen a carrier reduce beyond 50 percent, even if more than five surgical services are performed on the same date.

3. Some carriers will deny the 6^th, 7^th, etc., services, but will pay upon review of the medical records. In these instances, they usually pay for the service at the 50 percent reduction level.