Practice Economics

Misunderstood Modifiers


Modifiers are two-digit representations used in conjunction with a service or procedure code (e.g., 99233-25) during claim submission to alert payors that the service or procedure was performed under a special circumstance. Modifiers can:

  • Identify body areas;
  • Distinguish multiple, separately identifiable services;
  • Identify reduced or multiple services of the same or a different nature; or
  • Categorize unusual events surrounding a particular service.1

Many questions arise over appropriate modifier use. Hospitalist misconceptions typically involve surgical comanagement or multiple services on the same day. Understanding when to use modifiers is imperative for proper claim submission and reimbursement.

Multiple Visits

Most hospitalists know payors allow reimbursement for only one visit per specialty, per patient, per day; however, some payors further limit coverage to a single service (i.e., a visit or a procedure) unless physician documentation demonstrates a medical necessity for each billed service. When two visits are performed on the same date by the same physician, or by two physicians of the same specialty within the same group, only one cumulative service should be reported.2


Q: A hospitalist’s claim is denied as “an incidental service.” What should the hospitalist do?

A: The first line of defense is to ensure the claim submission was correct. Do not always respond with paper if the claim requires an electronic charge correction. Review the primary diagnosis associated with each of the reported services. If possible, assign a different primary diagnosis that indicates the primary reason for each service. Make sure modifier 25 is reported with the “incidental” service (e.g., append to the visit that occurred on the same day as a procedure), but only if this service is separate and distinct from preprocedural and postprocedural care, or care associated with the other service. If neither of these elements requires a revision, appeal the denial with documentation. Send a copy of the visit note and the procedure report (or documentation of the other service) to evidence the distinctness of services.

Consideration of two notes during visit-level selection does not authorize physicians to report a higher visit level (e.g., 99233 for two notes instead of 99232 for one note). If the cumulative documentation does not include the necessary elements of history, exam, or medical decision-making that are associated with 99233, the physician must report the lower visit level that accurately reflects the content of the progress note (for more information on documentation guidelines, visit

One exception to this “single cumulative service” rule occurs when a physician provides a typical inpatient service (e.g., admission or subsequent hospital care) for chronic obstructive bronchitis with acute exacerbation (diagnosis code 491.21) early in the day, and later the patient requires a second, more intense encounter for acute respiratory distress (diagnosis code 518.82) that meets the definition of critical care (99291). In this scenario, the physician is allowed to report both services on the same date, appending modifier 25 to the initial service (i.e., 99233-25) because each service was performed for distinct reasons.

If different physicians in the same provider group and specialty provided the initial and follow-up services, each physician reports the corresponding service in their own name with modifier 25 appended to the subsequent hospital care service (as above). Please note that physicians may not report both services if critical care is the initial service of the day. In this latter scenario, the physician reports critical-care codes (99291, 99292) for all of his or other group members’ encounters provided in one calendar day.3

Visits and Procedures

When a physician bills for a procedure and a visit (inpatient or outpatient) on the same day, most payors “bundle” the visit payment into that of the procedure. Some payors do provide separate payment for the visit, if the service is separately identifiable from the procedure (i.e., performed for a separate reason). To electronically demonstrate this on the claim form, the physician appends modifier 25 to the visit. Although not required, it is strongly suggested that, when possible, the primary diagnosis for the visit differs from the one used with the procedure. This will further distinguish the services. However, different diagnoses may not be possible when the physician evaluates the patient and decides, during the course of the evaluation, that a procedure is warranted. In this case, the physician may only have a single diagnosis to list with the procedure and the visit.

Payors may request documentation prior to payment to ensure that the visit is not associated with the required preprocedure history and physical. Modifier 57 is not to be confused with modifier 25. Modifier 57 indicates that the physician made the decision for “surgery” during the visit, but this modifier is used with preprocedural visits involving major surgical procedures (i.e., procedures associated with 90-day global periods). Since hospitalists do not perform major surgical procedures, they would not use this modifier with preprocedural visits.

Keep in mind that this “bundling” concept only applies when same-day visits and procedures are performed by the same physician or members of the same provider group with the same specialty designation. In other words, hospitalist visits are typically considered separate from procedures performed by a surgeon, and there is no need to append a modifier to visits on the same day as the surgeon’s procedure. The surgeon’s packaged payment includes preoperative visits after the decision for surgery is made beginning one day prior to surgery, and postoperative visits by the surgeon related to recovery from surgery, postoperative pain management, and discharge care.4 The surgeon is entitled to the full global payment if he provides the preoperative, intraoperative, and postoperative management.

Common Modifiers Involving Hospitalist Services

25: Significant, separately identifiable evaluation and management (E/M) service by the same physician on the same day of the procedure or other service. It may be necessary to indicate that on the day a procedure or service identified by a CPT code was performed, the patient’s condition required a significant, separately identifiable E/M service above and beyond the service provided or beyond the usual preoperative and postoperative care associated with the procedure that was performed. Modifier 25 is defined or substantiated by documentation that satisfies the relevant criteria for the respective E/M service to be reported. It may be prompted by the symptom or condition for which the procedure or service was provided. As such, different diagnoses are not required for reporting the E/M services on the same date. This circumstance may be reported by adding modifier 25 to the appropriate level of E/M service. Report this modifier with separately identifiable visits provided on the same day as minor surgical procedures or endoscopies.

54: Surgical care only. When one physician performs a surgical procedure and another provides preoperative and/or postoperative management, surgical services can be identified by adding the modifier 54 to the procedure number.

55: Postoperative management only. When one physician performs the postoperative management and another physician performs the surgical procedure, the postoperative component can be identified by adding the modifier 55 to the procedure number.

56: Preoperative management only. When one physician performs the preoperative care and evaluation and another physician performs the surgical procedure, the preoperative component can be identified by adding the modifier 56 to the procedure number.

57: Decision for surgery. E/M service resulting in the initial decision to perform the major surgery can be identified by adding the modifier 57 to the appropriate level of E/M service. Decisions for elective surgeries typically are made at a previous outpatient encounter. Do not append modifier 57 when this occurs.

If the surgeon relinquishes care and formally transfers the preoperative or postoperative management to another physician not associated with the surgical group, the other physician may bill for his portion of the perioperative management by appending modifier 56 (preop) or 55 (postop) to the procedure code. Unfortunately, the hospitalist is subject to the surgeon’s claim reporting. If the surgeon fails to solely report his intraoperative management (modifier 54 appended to the procedure code), the surgeon receives the full packaged payment. The payor will deny the hospitalist’s claim.

The payor is unlikely to retrieve money from one provider to pay another provider, unless a pattern of inappropriate claim submission is detected. Surgical intraoperative responsibilities are not typically reassigned to other provider groups unless special circumstances occur (e.g., geographical restrictions). Therefore, if the surgeon does not relinquish care but merely wants the hospitalist to assist in medical management, the hospitalist reports his medically necessary services with the appropriate inpatient visit code (subsequent hospital care, 99231-99233). TH

Carol Pohlig is a billing and coding expert with the University of Pennsylvania Medical Center, Philadelphia. She is on the faculty of SHM’s inpatient coding course.


1. Holmes A. Appropriate Use of Modifiers In: Coding for Chest Medicine 2009. Northbrook, Ill.: American College of Chest Physicians; 2008:273-282.

2. Centers for Medicare and Medicaid Services. Medicare claims processing manual. CMS Web site. Available at: Accessed Feb. 10, 2009.

3. Centers for Medicare and Medicaid Services. Medicare claims processing manual. CMS Web site. Available at: Accessed Feb. 10, 2009.

4. Pohlig, C. Sort out surgical cases. The Hospitalist. 2008;12(8):19.

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