A hospitalist who scrutinizes claims might notice a payment denial related to “unbundling” issues. Line-item rejections might state the service is “mutually exclusive,” “incidental to another procedure,” or “payment was received as part of another service/procedure.” Unbundling refers to the practice of reporting each component of a service or procedure instead of reporting the single, comprehensive code. Two types of practices lead to unbundling: unintentional reporting resulting from a basic misunderstanding of correct coding, and intentional reporting to improperly maximize payment of otherwise bundled Current Procedural Terminology (CPT) or Healthcare Common Procedure Coding System (HCPCS) codes.1
The Centers for Medicare and Medicaid Services (CMS) developed the National Correct Coding Initiative (NCCI) for implementation and application to physician claims (e.g., Medicare Part B) with dates of service on or after Jan. 1, 1996. The rationale for these edits is a culmination of:
- Coding standards identified in the American Medical Association’s (AMA) CPT manual;
- National and local coverage determinations developed by CMS and local Medicare contractors;
- Coding standards set forth by national medical organizations and specialty societies;
- Appropriate standards of medical and surgical care; and
- Current coding practices identified through claim analysis, pre- and post-payment documentation reviews, and other forms of payor-initiated audit.
The initial NCCI goal was to promote correct coding methodologies and to control improper coding, which led to inappropriate payment in Part B claims.2 It later expanded to include corresponding NCCI edits in the outpatient code editor (OCE) for both outpatient hospital providers and therapy providers. Therapy providers encompass skilled nursing facilities (SNFs), comprehensive outpatient rehabilitation facilities (CORFs), outpatient physical therapy (OPTs) and speech-language pathology providers, and home health agencies (HHAs).
The NCCI recognizes two edit types: Column One/Column Two Correct Coding edits and Mutually Exclusive edits. Each of these edit categories lists code pairs that should not be reported together on the same date by either a single physician or physicians of the same specialty within a provider group.