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Dermatologists provide many types of medical, surgical and cosmetic procedures and services, but getting reimbursed appropriately is a challenge. In fact, responding to Medscape’s 2019 dermatologist compensation survey, dermatologists reported getting fair reimbursement and having so many rules and regulations as the most challenging part of their job. Up to 46% of dermatologists said they spent 10-19 hours a week on paperwork and administrative tasks, compared with 38% of all physicians. Outsourcing dermatology medical billing is a practical solution to stay current on changing codes and billing rules, and ensure proper payment for services rendered. Here are the recent and upcoming billing, coding and documentation updates impacting dermatologists:

  •  New time reporting option for evaluation and management (E/M) services: More options for reporting E/M services came into effect beginning Jan. 1, 2019. In addition to using the current 1995 and 1997 documentation guidelines, office/outpatient E&M codes can be selected based on time or by using medical decision-making alone, regardless of the level of history or physical exam performed. Previously, selecting a visit based on time required documentation of the duration of face-to-face time with the patient and more than 50 percent of the visit had to be spent in counseling or coordination of care. The definition of time associated with E/M codes 99202-99215 has been changed from “typical face-to-face time” to “total time spent on the day of the encounter.” Starting 2021, physicians will no longer need to establish how much time was devoted to counseling and coordinating on the day of the encounter. Code selection would depend on the total length of the visit even if counseling did not dominate the service time.
  • Changes in modifier payment policy: CMS and other payers constantly scrutinize how physicians are using modifier 25 (significant, separately identifiable evaluation and management [E/M] service by the same physician on the same day of the procedure or other service) and modifier 59 (Distinct Procedural Service), and whether there are instances of overpayment. According to an article in Dermatology Times, approximately 60% of E/M services performed by dermatologists are submitted with modifier 25 attached, compared to about 25% “for the rest of medicine.” This means that any change in modifier 25 payment policy will affect dermatology more than other specialties. Dermatologists must be knowledgeable about the specific requirements associated with the use of modifier 25 or risk recoupments resulting from post-payment audits. Modifier 59, which indicates a separately identifiable procedure done on the same encounter date on the same person, should not be appended to additional biopsy codes.
  • Medicare changing modifier rules changing to override claims edits: Traditionally, Medicare and other payers that use the National Correct Coding Initiative (NCCI) edits to bundle services provided to the same patient on the same date have required that any modifier used to override an edit must be applied to the “column 2 code” in an edit pair (i.e., the code that would not be paid in the absence of a modifier). Effective July 2019, Medicare has allowed the following modifiers to be appended to either code in the procedure to procedure NCCI edits, when a modifier override is allowed:
    • 59 – “Distinct Procedural Service”
    • XE – “Separate encounter, A service that is distinct because it occurred during a separate encounter”
    • XS – “Separate Structure, A service that is distinct because it was performed on a separate organ/structure”
    • XP – “Separate Practitioner, A service that is distinct because it was performed by a different practitioner”
    • XU – “Unusual Non-Overlapping Service, The use of a service that is distinct because it does not overlap usual components of the main service”

Modifier 25 is an exception to this new rule and must still be appended to the “column   2 code” unless the payer instructs otherwise (

  • Changes in biopsy coding: Dermatologists perform skin biopsy on a daily basis. In 2019, dermatology has a set of six new biopsy codes CPT 11102-11107, i.e., three types of primary biopsy codes and three kinds of secondary codes.
    • 11102 Tangential biopsy of skin, single lesion
    • + 11103 each separate/additional lesion
    • 11104 Punch biopsy of skin (including simple closure, when performed) single lesion
    • +11105 each separate/additional lesion
    • 11106 incisional biopsy of skin (including simple closure, when performed) single lesion
    • +11107 each separate/additional lesion

Physicians must consider hierarchy when using these codes:

    • Only one primary code can be reported if several biopsies of different types are obtained from the same patient at the same visit.
    • Additional biopsies should be designated by their add-on codes.
    • Incisional is always primary to punch and tangential, and punch is always primary to tangential (
  • Coding for photodynamic therapy (PDT): PDT codes have changed to incorporate physician work time and become more complex. Introduced in 2018, PDT CPT codes 96567, 96573, and 96574 are used to report nonsurgical treatment of cutaneous lesions using PDT (i.e., external application of light to destroy premalignant lesions of the skin and adjacent mucosa by activation of photosensitizing drug). These codes can only be used once per patient per day, and only one of the 3 codes can be used on a given anatomic area (i.e., face and scalp) on a given day. Original PDT code 96567 (Photodynamic therapy by external application of light to destroy premalignant lesions of the skin and adjacent mucosa with application and illumination/activation of photosensitive drug(s), per day) should be used when there is no physician involvement in treatment delivery.
  • New laser code sets: Two new laser code sets were introduced in 2018:
    • 0479T and +0480 or fractional ablative laser fenestration of burn and traumatic scars for functional improvement, and
    • 0491T and +0492T for ablative laser treatment of open wounds

These are Category III code or emerging technology codes which may not be reimbursed by CMS or private insurance companies. Insurers can choose to pay at levels they consider appropriate for these codes. If widespread usage is confirmed, Category III codes may be reclassified as Category I codes which insurers generally reimburse.

Working with an experienced dermatology medical billing and coding company can help practitioners ensure correct use of new dermatology codes on claims for appropriate compensation.

Meghann Drella

Meghann Drella possesses a profound understanding of ICD-10-CM and CPT requirements and procedures, actively participating in continuing education to stay abreast of any industry changes.

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