ICD-10 CLINICAL CONCEPTS FOR ONCOLOGY & CODING GUIDELINES

CPT Coding Guidelines for Laboratories

The new guidelines for CPT® 2023 features new codes, 93 revised codes, and 75 deleted codes. Also, there are new guidelines introduced for the application of updated CPT lab medical billing codes for every procedure except anesthesia. The most significant changes are to the evaluation and management (E/M), percutaneous pulmonary artery revascularization, hernia repairs, lab and pathology, and COVID-19 vaccination codes.

Also, there are 2 new appendices for artificial intelligence (AI) taxonomy (Appendix S) and synchronous real-time interactive audio-only telemedicine services (Appendix T).

Here are the major highlights to changes by section, all of which became effective as of 1 Jan 2023.

Here are the major highlights to changes by section, all of which became effective as of 1 Jan 2023.

CPT Codes

Current Procedural Terminology (CPT®) codes provide a uniform nomenclature for translating medical procedures and diagnostic services into standard & billable medical codes.

Medical CPT codes are essential to streamline reporting and ensure accuracy and efficiency of the lab billing procedure. Also, applying accurate CPT coding practices smooths out your administration operations such as claims processing and developing guides.

Why CPT Codes Are Used For Lab Tests?

Laboratory CPT codes and pathology CPT codes are used to represent the lab tests and diagnostic procedures used to evaluate the specimens collected from the patient by invasive/ surgical techniques to provide information to the healthcare for the treatment of that patient.

As mentioned earlier, information obtained from lab tests is critical to decision-making in healthcare facilities like clinics, hospitals, and other medical organizations. However, labs only get 30% of the revenue as compared to the finances of healthcare facilities.

If medical labs apply incorrect CPT codes then it can lead to claim denials/ rejections causing a reduction in reimbursements and inefficiency in revenue growth. Therefore, in order to prevent payment denial issues healthcare labs should apply accurate and latest medical codes.

Common CPT Codes for Pathology Services

Here are the most common CPT codes used for laboratory billing services in 2024;

88300 to 88332: CPT codes for dermatologists

This CPT code range is used to describe pathology services. However, there are some specific billing rules that are particularly designated to dermatologists for pathology.

• No Billing For Pathology Services:

When a dermatologist sends a tissue specimen to an outside reference lab who is responsible to perform technical and professional services (referred to as the global service) and they send bills to the insurance company directly (without referring to any third-party) then there is no “pass-through” billing (which means that the dermatology practice has bought these services from the pathology lab at a discounted price).

Simply put, the dermatology practice has marked up the cost of the service, and then passed the increased charges on to the patient or insurance company through direct billing on the behalf of their practice.

• Pass-Through Billing:

Another way a dermatology practice can charge for pathology lab tests is through Pass-through billing. In this case, the dermatologist earns money by buying the technical component, or both.

The practice marks up the cost of the purchased service and passes the excessive charges on to the patient’s insurance company by billing the pathology service(s) directly to the payer.

Some insurance companies are now establishing new policies that don’t allow healthcare providers to pass through their bills.

For example, Medicare doesn’t allow pass-through billing for any healthcare lab or medical facility at all.

Here are the most common CPT codes for some dermatopathology procedures;

1. 88304: Level III

Introduced by the American Medical Association, this CPT code is used under the range of surgical pathology procedures.

This medical codes is used to describe surgical pathology, gross and microscopic examination for the pathology tests in the following procedures;

• Abcess
• Anus, Tag
• Pilonidal Cyst
• Bartholin’s Gland/Cyst
• Cartilage
• Shavings
• Conjuctiva-biopsy/Pterygium
• Pilonidal Cyst, Sinus
• Skin, Cyst/Tag/Debridement
• Soft Tissue, Debridement
• Soft Tissue, Lipoma
• Vein, Varicosity
2. 88305: Level IV

This medical code is used to describe level IV surgical, pathology, gross and microscopic examination. When a lab technician or pathologists examines multiple, separate tissue samples on the same date of service.

• Surgical pathology, gross and microscopic examination include;
• Lip, Biopsy/Wedge Resection.
• Skin, other than Cyst/Tag/Debridement,
• Soft tissue
• Other than Tummour/Mass/Lipoma/Debridement
• Tongue Biopsy.

The Modifier Technical Component (TC):

This modifier refers to the technical component of the pathology procedures that are involved in the preparation of the slide. Usually, lab technicians perform these pathology procedures.

3. 88304 Level III:

It is used to describe level III pathology services like hematoma, anus, and abscess in the medical records.

4. 88305:

This modifier is used for level IV of pathology or any microscopic examination. For example, skin, lips, tongue, etc.

General CPT Changes

As discussed earlier, it is critical to include modifiers along with CPT codes to fully describe a medical procedure. It will help lab billing specialists to represent any necessary specific entails of the lab test which will help healthcare labs to get paid for their services the right way. Also, medical billers should mention appropriate quantities in the days/ units fields to clearly describe when the lab services are delivered to the patient.

There are also “Documentation” modifiers that are billed in the first modifier field.

Modifier "-91" indicates repeat clinical diagnostic laboratory test.

Modifier "-LR" indicates round trip travel.

Modifier "-90" Referred Laboratory Services (refer to C)

General ICD-10 Changes

However, when you’re reporting or billing the charges for diagnostic services deleivered to the patient then you must use ICD-10 codes. The ICD-10 codes should also be used to the highest level of specificity, describing the primary condition in the first position in Item 21 on Form CMS-1500 or the electronic equivalent.

If ICD-10 codes are not accurately then and not meeting the digital level completeness criteria will not get paid by the insurance company and end up getting denied as unprocessable.

It is clearly comprehensible that any diagnosis information provided to the insurance company must have medical justification for the procedure (in patient’s health record). If the diagnostic procedure is not justified medically to the insurance pauers then it will result in a retroactive denial under Section 1862(a)(1)(A).

Avoid Invalid Clinical Laboratory Improvement Act (CLIA)

CLIA numbers are essential for laboratory billing services to receive reimbursements for CLIA covered procedures. CLIA is a federal program, State Agencies (SAs) which is responsible to supervise and maintain CLIA laboratories’ certification records.

However, there are some states who also have their own laboratory laws that are exclusive from the CLIA regulations. Therefore, you should also check out the state-specific billing regulations along with the coverage plan available in your state.

The 10-digital CLIA certification number must be placed in Item 23 of the CMS-1500 form or the electronic equivalent.

In case of breaching CLIA certification, following penalties can create challenges for the healthcare labs by imposing suspension, limitation or revocation of any type of CLIA certificate.

You can read out the complete legislative limitations of the CLIA certification from the following link;