1. Schaum, Kathleen D. MS

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Medicare audits are increasing, and this author has received many calls from hospital-owned outpatient wound/ulcer management provider-based departments (PBDs) whose internal and external audit findings show inappropriate use of modifiers on their Medicare claims. This author found two widespread misperceptions that explained why the PBDs' claims were improperly coded. This article shares those misperceptions so that you can learn from them and prevent future claims denials and/or repayments after audits.



Medicare Outpatient Prospective Payment System (OPPS) Status Indicators are assigned to every Healthcare Common Procedure Coding System (HCPCS) code. The OPPS Status Indicator identifies whether the service described by the HCPCS code is paid under the OPPS and, if so, whether payment is made separately or packaged. The OPPS Status Indicators are available in the hospital OPPS Addendum A and B Updates.1 Following are some of the OPPS Status Indicators, along with example(s), assigned to the HCPCS codes (with shortened descriptions) most frequently reported by wound/ulcer management PBDs.


H = Pass-through device categories; separate cost-based pass-through payment; not subject to copayment


C1832 Autograft suspension, including cell processing and application, and all system components


J2 = Hospital Part B services that may be paid through a comprehensive ambulatory payment classification (C-APC); Addendum B displays APC assignments when services are separately payable.


G0463 Hospital outpatient clinic visit


K = Non-pass-through drugs and biologics; paid under OPPS; separate APC payment


C9250 Human plasma fibrin sealant, vapor heated, solvent-detergent (Artiss), 2 mL


N = Items and services packaged into APC Rates; paid under OPPS; payment is packaged into payment for other services, including outliers. Therefore, there is no separate APC payment.


+11045 Debridement subcutaneous tissue, each additional 20 sq cm or part thereof


+15272 Application of skin substitute graft to trunk, arms, legs; each additional 25 sq cm


Q1 = STVX-packaged codes; packaged APC payment if billed on the same claim as an HCPCS code assigned status indicator "S," "T," "V," or "X"


17250 Chemical cauterization of granulation tissue


97605 Negative-pressure wound therapy, using durable medical equipment: wound surface area less than or equal to 50 sq cm


Q2 = T-packaged codes; packaged APC payment if billed on the same claim as an HCPCS code assigned status indicator "T"


C9733 Non-ophthalmic fluorescent vascular angiography


S = Significant procedure, not discounted when multiple; paid under OPPS; separate APC payment


G0277 Hyperbaric oxygen under pressure, full body chamber, per 30-minute interval


99406 Smoking and tobacco use cessation counseling, 3 to 10 minutes


99407 Smoking and tobacco use cessation counseling, greater than 10 minutes


T = Significant procedure, multiple reduction applies; paid under OPPS; separate APC payment


11042 Debridement subcutaneous tissue, 20 sq cm or less


15271 Application of skin substitute graft to trunk, arms, legs; first 25 sq cm or less


29581 Application of multilayer compression system; leg (below knee), including ankle and foot


97597 Debridement, open wound, (eg, fibrin, devitalized epidermis and/or dermis, exudate, debris, biofilm), per session, total wound(s) surface area first 20 sq cm or less


97607 Negative-pressure wound therapy, using disposable, nondurable medical equipment: wound(s) surface area less than or equal to 50 sq cm


97608 Negative-pressure wound therapy, using disposable, nondurable medical equipment: wound(s) surface area greater than 50 sq cm


V = Clinic or emergency department visit; paid under OPPS; separate APC payment


98975 Remote therapeutic monitoring, initial setup, and education


To explain the first major coding misperception, let us think about the HCPCS codes that are assigned "T" Status Indicators. When reading the definition of the "T" Status Indicator, it is easy to assume that Medicare will pay 100% for 15271 and 50% for 11042 when both procedures are performed during the same encounter. However, the National Correct Coding Initiative (NCCI) Procedure-to-Procedure (PTP) edits2 have precedence over the OPPS Status Indicators. The PTP edits are created to prevent improper payment when incorrect code combinations are reported. The NCCI edits contain one table of PTP edits for physicians/practitioners and one for outpatient hospital services. Both PTP tables list the comprehensive or major code in the first column and the secondary or component code in the second column.


Therefore, in the example above, even though the OPPS "T" Status Indicators mean that Medicare could pay 100% for 15271 and 50% for 11042, the PTP edit packages the payment for 11042 into the payment for 15271 (Table). Therefore, if the PBD reports those codes together on the same claim, Medicare will only pay for the code (15271) that appears in the first column of the PTP file, unless (1) the two procedures were performed on different anatomic locations, (2) both procedures were thoroughly documented, and (3) the appropriate modifier was appended to the code (11042) that appears in column 2.

Table EXAMPLES OF CO... - Click to enlarge in new windowTable

NOTE: The code pairs (11042 with 97607 or 97608) do not have a PTP edit, which means that disposable negative-pressure wound therapy should be paid by Medicare when applied following subcutaneous debridement during the same encounter.



After each patient encounter, most PBDs submit the code(s) that reflect(s) the work that was performed into their charging software. Some PBDs append modifiers to their codes, whereas other PBDs depend on their coders to append the modifiers. During audit investigations, this author found that many PBDs and coders append appropriate modifiers but believe that their documentation does not have to support the use of the modifier. To show the importance of accurate and thorough documentation for all services and procedures and for all modifiers, let us review a real-life example about reporting the same codes we discussed previously.


A physician in a PBD reported 11042 (debridement of subcutaneous tissue) from a venous leg ulcer and 15271 (application of a cellular and/or tissue-based product [CTP] for skin wounds) to the same ulcer. The physician appended modifier -59 (distinct or independent service performed on the same day) to 11042. The PBD also reported 15271 and 11042-59 on the facility claim. Based on the OPPS Status Indicators, the PBD believed that the facility should be paid 100% of the Medicare allowable rate for 15271 and 50% of the Medicare allowable rate for 11042. However, the PBD did not take the NCCI edit into consideration before submitting their claims.


Unfortunately, both the physician and the PBD had a prepayment audit. The physician's documentation was very minimal: "debrided venous ulcer of left leg and applied XXXXX CTP." Not only were both procedures performed on the same ulcer, but they were not correctly and thoroughly documented.


Because the NCCI edit bundles 11042 into 15271, the prepayment audit resulted in Medicare payment for only 15271 to both the PBD and the physician. Actually, the PBD and physician were lucky to be paid for 15271 because the "who, what, where, when, and how much" were not thoroughly documented. However, a few months later, their luck ran out during a postpayment audit that (1) found that the physician's documentation did not support medical necessity for most of his CTP applications and (2) resulted in sizeable repayments.



Take the time to review your own processes by following these steps:


* Audit your claims that include modifiers meant to override NCCI PRP edits.


* Review the exact descriptions of the codes you use to report your work.


* Review your major payers' utilization and documentation guidelines for each code.


* Review and improve your documentation to meet the payers' guidelines.


* Determine whether physicians and PBD personnel or the coders should append modifiers to codes to override NCCI PTP edits.


* Determine who should review and verify that documentation supports the code descriptions, payers' guidelines, and NCCI edit guidelines.


* Educate clinical and revenue cycle staff about any refinements needed, with accompanying rationales.


* Implement your new processes and refinements.


* Audit the documentation and claims with modifiers once again. Inform staff about the audit results. If the documentation met all the requirements, and modifiers were only appended to codes when they were justified, congratulate the team. If the audit results showed areas that need improvement, educate specific team members as needed and continue to conduct audits until everyone has reached perfection.





1. Hospital OPPS Addendum A and B Updates. Last accessed July 4, 2022. [Context Link]


2. National Correct Coding Initiative Procedure-to Procedure Edits. Last accessed July 4, 2022. [Context Link]