Knowledge Base Article

I have really good intentions. I plan to do this and plan to do that, but sometimes “the best-laid plans of mice and men often go awry.” This is often simply a failure on my part to follow through, but other times, things happen that impede my plans. This can happen to anyone – rain on the day of a planned outdoor outing, an injury that prevents a planned activity, or extenuating circumstances that prevent a planned medical procedure.

The problem with planned medical procedures that have to be canceled is that the hospital often has already invested resources into preparing for the planned service. Thankfully, Medicare has a means to report canceled services that allows the hospital to recoup some or all of their expenses through the use of modifiers. It is incumbent on the hospitals to appropriately use these modifiers and maintain documentation in their medical records that support their use. As with all reimbursements, there is a risk that payments may be made when not appropriate. A couple of weeks ago, Medicare approved a new issue for the Recovery Auditors (RACs) regarding “Discontinued Procedure Prior to the Administration of Anesthesia: Coding and Documentation Requirements.” This is to be a complex review, meaning the RACs will request and review medical record documentation to determine if payment was appropriate. The review is for Ambulatory Surgical Centers (ASCs) and outpatient hospitals. As of the date of this article, none of the RACs have posted this issue on their Approved Issues websites. Also note that at this time, the link for the details of the issue on the CMS RAC Approved Issues webpage is not working.

However, the instructions for the use of modifiers for discontinued services can be found in Chapter 4 of the Medicare Claims Processing Manual, section 20.6.4. There are two modifiers for services which require the use of anesthesia and one modifier for services that do not require anesthesia. According to the manual reference above, “Modifiers provide a way for hospitals to report and be paid for expenses incurred in preparing a patient for a procedure and scheduling a room for performing the procedure where the service is subsequently discontinued.”

For the modifiers for services requiring anesthesia (modifiers -73 and -74), anesthesia is defined as:

• Local anesthesia,
• Regional blocks,
• Moderate sedation/analgesia (“conscious sedation”),
• Deep sedation/analgesia, or
• General anesthesia.

Modifier -73 is used when procedures requiring anesthesia are terminated prior to administration of anesthesia.  Other considerations for using modifier -73 include:

• Termination is due to extenuating circumstances or to circumstances that threatened the well-being of the patient.
• Termination occurs after the patient had been prepared for the procedure (including procedural pre-medication when provided), and has been taken to the room where the procedure was to be performed.
• Procedures reported with modifier -73 will be paid at 50% of the full OPPS payment amount.
• Payment for device-intensive procedures (device offset amount exceeds 30% of the procedure’s mean coast) reported with modifier -73 will be reduced by 100% of the device offset amount prior to applying the additional payment adjustments.
• Documentation should clearly indicate the reason the procedure is being canceled and support that the patient was prepped and taken to the procedure room.

Modifier -74 is used when procedures requiring anesthesia are terminated after the induction of anesthesia or after the procedure was started (e.g., incision made, intubation started, scope inserted). Other facts about modifier -74 include:

• Termination is due to extenuating circumstances or to circumstances that threatened the well-being of the patient.
• Modifier -74 may also be used to indicate that a planned surgical or diagnostic procedure was discontinued, partially reduced or cancelled at the physician's discretion after the administration of anesthesia.
• Procedures reported with modifier -74 will be paid at the full OPPS payment amount.
• Documentation should clearly indicate the reason the procedure is being canceled and support that the patient received anesthesia and include the progress of the procedure.

Modifier -52 is used to indicate partial reduction, cancellation, or discontinuation of services for which anesthesia is not planned. For modifier -52,

• The patient has been prepared and taken to the room where the procedure is to be performed.
• Procedures reported with modifier -52 will be paid at 50% of the full OPPS payment amount.
• Documentation should clearly indicate the reason the procedure is being canceled and support that the patient was prepped and taken to the procedure room.
• This modifier is often used for radiologic procedures that cannot be completed as planned.

NOTE: The elective cancellation of a procedure should not be reported.

When things do not work out as planned, it is good to have a back-up plan, or in the case of medical procedures, a way to recoup your cost. Just make sure you code, document, and bill appropriately.