Understanding Unbundling in Medical Billing

by | Published on Feb 26, 2019 | Medical Billing

Medical Billing
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In 2018, the American Medical Association (AMA) identified unbundling codes or using multiple CPT codes for parts of a procedure, as one of the most common medical coding errors. As every medical billing and coding company knows, it is important to distinguish when separate reporting of services is correct coding and when such reporting becomes fraudulent.

Unbundling is billing for procedures separately that are normally covered by a single, comprehensive CPT code. The Centers for Medicare and Medicaid (CMS) publishes National Correct Coding Initiative (NCCI) edits, which are pairs of codes that should not be billed together. The goal of the NCCI is to prevent improper coding and fraudulent claims.

Each NCCI edit signifies a pair of services or procedures that normally should not both be billed when performed by the same provider on the same patient on the same day. In other words, the two codes in an NCCI edit are “bundled” together. Unbundling occurs when multiple CPT codes are used to report component parts of the procedure, either unintentionally or in order to increase payment.

Here are some examples of unbundling from www.outpatientsurgery.net:

  • Fragmenting one service into component parts and coding each component part as a separate service
  • Reporting separate codes for related services when one comprehensive code includes all related services
  • Breaking out bilateral procedures when one code is appropriate
  • Separating a surgical approach from a major surgical service

Billing for a lesion excision and skin repair on a single service date would constitute unbundling and generate an NCCI edit. CPT coding guidelines say that simple repairs are included in the excision codes and should not be coded separately. However, if the repair was done on a different site from where the lesion was removed, both procedures can be billed and a modifier can be appended to let the payer know the skin repair was separate from the excision.

In their bundling guidelines, Blue Cross Blue Shield of North Carolina lists services considered incidental, mutually exclusive, integral to the primary service rendered, or part of a global allowance, which are not eligible for separate reimbursement:

  • Incidental Procedures: An incidental procedure is one performed at the same time as a more complex primary procedure and is not eligible for separate payment on a claim. For e.g., the removal of an asymptomatic appendix is considered an incidental procedure when done during hysterectomy surgery.
  • Mutually Exclusive Procedures: These refer to two or more procedures that are usually not performed on the same patient on the same date of service. The provider should submit only one of the procedure codes. For instance, generally, an open procedure and a closed procedure in the same anatomic site are not both reimbursed. If both codes realize the same result, only the most clinically intense procedure will be allowed.
  • Integral Procedures: Integral procedures are those that commonly carried out as part of a total service and do not meet all the criteria listed under the policy “Multiple Surgical Procedure Guidelines.” They occur in multiple surgery situations when one or more of the procedures are included in the major or principle procedure. For e.g., diagnostic endoscopy/arthroscopy is always included in surgical endoscopy/arthroscopy.
  • Global Allowance: Most medical and surgical procedures include preoperative, intraoperative, and postoperative services. These services are reimbursed based on a global allowance. Services Included in the Global Surgical Package are not separately reportable.

According to the AAPC, a clear understanding of the differences between the rules pertaining to coding, billing, and reimbursement is necessary to know when unbundling can turn potentially problematic. In fact, the AAPC notes that, “Separate reporting of bundled services is not impermissible unbundling when separate reporting was not intended to, and does not reasonably lead to, improper reimbursement”. Separate reporting of codes is justified for correct and complete reporting of the entire service.

So when is unbundling permissible? Here are some examples provided by the American Academy of Ophthalmology demonstrating how to unbundle NCCI edits:

A patient has pterygium surgery in the right eye. During the 90-day global period, the patient is hit in the left eye with a bungee cord, causing a traumatic cataract and vitreous hemorrhage. Immediate surgery is scheduled.

Vitrectomy (67036) and cataract extraction (66984) are bundled. In this case, it is appropriate to append modifier -59 to unbundle since it was known preoperatively that the patient needed both procedures. Modifier -59 should be appended to CPT code 66984 because this is the secondary procedure submitted on the claim due to its lower allowable. Modifier 79 should be used to indicate that cataract removal and vitrectomy are unrelated to the pterygium surgery.

Outsourcing medical billing and coding to an expert is the best way to report services correctly. Reliable medical billing and coding companies have a skilled team on board that can ensure that providers receive appropriate payment for the work they perform. They will check National Correct Coding Initiative (NCCI) edits when reporting multiple codes. A knowledgeable coder will identify and assign the appropriate CPT and/or HCPCS Level II code(s) to correspond to each component of the overall service provided, and submit accurate claims conveying the necessary information to the payer, preventing fraud risk and maximizing reimbursement.

Natalie Tornese

Holding a CPC certification from the American Academy of Professional Coders (AAPC), Natalie is a seasoned professional actively managing medical billing, medical coding, verification, and authorization services at OSI.

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