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Update on NCCI Edits Regarding Inhalation Treatments

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May 20, 2014

Earlier this year, we notified our members about certain coding edits regarding inhalation treatments using CPT code 94640 (pressurized or non-pressurized inhalation treatment for acute airway obstruction…) that became effective January 1, 2014. These edits are developed by the Centers for Medicare and Medicaid Services (CMS) as part of the National Correct Coding Initiative (NCCI) to promote national correct coding methodologies and to control improper coding leading to inappropriate payment in Part B claims.

At issue is the statement in the NCCI Manual that reads: “CPT code 94640 should only be reported once during a single patient encounter regardless of the number of separate inhalation treatments that are administered.”

Since these coding edits became effective, confusion continues to exist among respiratory therapists and hospitals as to how to interpret the changes.  To get further clarification in order to resolve the confusion, we went directly to the experts who were involved in making the coding decisions (e.g., the Medical Director and Coding Specialist at Correct Coding Solutions, LLC, the Medicare/ Medicaid Contractor responsible for the NCCI edits).  Our concerns about whether respiratory therapists could report inhalation treatments subsequent to a single encounter on the say day were discussed with CMS which makes all decisions about the NCCI contents.

Based on the information we received in writing, here are the facts you need to know.

  • NCCI Edits apply only to hospital services covered under Part B.  They do not apply to acute care inpatient treatments.
  • CPT code 94640 should only be reported once during a single encounter regardless of the number of separate inhalation treatments that are administered.  What does this mean in practical terms?  The key is the term “single encounter.”  If a respiratory therapist is furnishing inhalation therapy with multiple nebulizer administrations sequentially during a single patient visit (i.e., the RT does not leave the room), this is seen as a single treatment and only one (1) unit of CPT code 94640 can be reported regardless of the number of administrations.
  • If there are multiple separate patient encounters for inhalation therapy on the same date of service, the additional encounters for inhalation therapy may be reported with modifier 76.  In other words, if the respiratory therapist provided an inhalation treatment in the morning, then later returned to the room to administer further treatments and again later in the evening to furnish yet another inhalation treatment, the two additional separate face-to-face patient encounters can be reported using modifier 76.
  • The definition of “patient encounter” means “direct personal contact in the hospital between a patient and a physician, or other person authorized by State law and, if applicable, by hospital or CAH staff bylaws to order or furnish services for diagnosis or treatment of the patient.”   The definition appears in CMS Manuals regarding hospital outpatient services and claims processing and in regulations affecting Medicare Part B.  Based on the manual definition of “encounter” and the advice AARC received from the coding experts, it would appear hospitals should consider each visit by a respiratory therapist to be an encounter, especially in light of the advice from CMS that subsequent inhalation treatments with separate patient encounters on the same day can be reported with a modifier.  We have been informed that in some cases, hospitals are considering the individual treatment sessions as the “entire visit”, when in fact the definition itself would indicate otherwise. 
  • Billing departments and/or compliance officers should check with the Medicare contractor that pays their facility’s Part B claims if there are any questions or uncertainties as to the interpretation of the NCCI edits.   Some hospitals are making their own interpretations that could, in fact, be more restrictive or incorrect.  We cannot emphasize enough that direct contact with the contractor is the best way to resolve any issues.